Fifth Third Bancorp (FITB, Financial) has entered into a significant share repurchase agreement with Morgan Stanley & Co. LLC, as disclosed in a recent Form 8-K filing. The agreement, dated October 21, 2024, involves the repurchase of approximately $300 million worth of Fifth Third's outstanding common stock. This move is part of the company's ongoing 100 million share repurchase program, initially announced in June 2019.
Under the terms of the agreement, Fifth Third will pay Morgan Stanley an aggregate of $300 million on October 22, 2024. The bank anticipates receiving a substantial majority of the shares by the same date. The actual number of shares to be delivered will be determined based on a discount to the average daily volume-weighted average NASDAQ prices of Fifth Third's common stock during the agreement's term.
The settlement of this transaction is expected to occur on or before December 27, 2024. The agreement includes customary adjustments and termination provisions, allowing Morgan Stanley to terminate the agreement under certain extraordinary circumstances, potentially resulting in Fifth Third receiving fewer shares than initially expected.
This strategic buyback is aimed at enhancing shareholder value and reflects Fifth Third's commitment to returning capital to its shareholders. The bank has a history of engaging in financial advisory and other services with Morgan Stanley and its affiliates, for which they have received customary fees and expenses.
Fifth Third Bancorp continues to focus on strategic initiatives that align with its long-term growth objectives, while also navigating the complexities of the financial markets and regulatory environment.
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