We were very excited to be the first issuer of a social bond of the US regional banks, a $1.25 billion bond that was well, well-received 120 investors, very favorable pricing.
And we received 100% score on Human Rights Campaign's Corporate Equality Index, and we were named the Best Place to Work in '21.
We also continue to make great progress in terms of executing on our $60 billion Community Benefits agreement and we are already at 114% of our annual target.
We did close 226 branches in the first quarter, which was part of our strategy.
We had strong adjusted net income of $1.6 billion, or $1.18 per share adjusted, both up 42% versus the first quarter of '20.
We had adjusted ROTCE of 19.36%.
Strong expense discipline, as our adjusted non-interest expense decreased $57 million sequentially, and our merger-related and restructuring charges decreased $167 million.
We significantly had lower provision for credit losses of $48 million versus $177 million in the fourth quarter.
So we had a reserve release of $190 million.
NPAs decreased $88 million, or 6.3%, which we were very happy about.
We completed $506 million of the share repurchases.
So we had a total payout for the quarter of about 83%.
We did redeemed $950 million of preferred stock during the quarter at an after-tax cost of $26 million, or $0.02 per share, which was not excluded in terms of our adjustment to net income.
So overall, if you look at Slide 8, you will see how the adjustments worked with the merger-related charges having a diluting impact of $0.08, incremental operating expenses related to the merger that are not in our ongoing recurring charges going forward was $0.10 and an acceleration for cash flow hedge unwind expense of $0.02.
If you can see from Page 9, our clients continue to adopt digital at a rapid pace.
Since last March, the population of active mobile app users has increased 11% to more than 4 million users, and that marks an important milestone along our digital journey of the Company.
Our digital commerce data bear this out as digital client needs have met -- digital client needs met have improved 44% since the first quarter of 2020 and represent more than one-third of total bank production of core bank products.
Average loans decreased $8.2 billion, compared to the fourth quarter, primarily due to a $4.5 billion reduction in commercial balances and $3 billion of residential mortgage run off.
Approximately $3.3 billion of PPP loans were repaid during the quarter, impacting average commercial balances by $1.8 billion.
Average consumer loans decreased $3.6 billion as ongoing refinance activity impacted residential mortgage, home equity and direct loan balances.
Average deposits increased $7.9 billion sequentially and are up more than $28 billion from the first quarter of 2020, reflecting government stimulus and pandemic-related client behaviors.
During the first quarter, average total deposits cost decreased 2 basis points to 5 basis points and average interest-bearing deposit cost declined 4 basis points to 7 basis points.
Net interest income decreased $81 million linked quarter due to fewer days, lower purchase accounting accretion and lower earning asset yields.
Reported net interest margin was down 7 basis points, reflecting a 4 basis point impact from lower purchase accounting accretion.
Core net interest margin decreased 3 basis points as deposit inflows resulted in higher combined Fed balances and securities.
Non-interest income decreased $88 million despite record income from insurance and investment banking and trading.
Insurance income increased $81 million linked quarter, reflecting seasonality, $28 million from recent acquisitions, and $19 million due to a timing change related to certain employee benefit accounts.
Organic revenue grew 6.4% due to strong new business, stable retention and higher property and casualty rates.
Investment banking and trading rose $32 million, benefiting from strength in high-yield, investment-grade and equity originations, as well as a recovery in CVA.
Residential mortgage income decreased $93 million due to lower production margins and volumes.
Commercial real estate income decreased $80 million due to seasonality and strong fourth quarter transaction activity.
Other income was down $18 million as lower partnership income was partially offset by gains from a divestiture.
Non-interest expense was down $223 million linked quarter, reflecting a $167 million decrease in merger-related and restructuring charges.
Adjusted non-interest expense decreased $57 million, primarily due to lower professional fees and non-service-related pension costs offset by personnel expense.
Personnel expense increased $34 million, reflecting higher equity-based compensation, higher incentive compensation and payroll tax resets, partially offset by lower salaries and wages.
As we said in January, we continue to expect total combined merger costs of approximately $4 billion.
This consists of merger-related and restructuring charges of approximately $2.1 billion and incremental operating expenses related to the merger of approximately $1.8 billion.
Since the merger was announced, we have incurred $1.3 billion of merger-related and restructuring charges and $900 million incremental operating expenses related to the merger.
Non-performing assets were down $88 million, or 2 basis points as a percentage of total loans, largely driven by decreases in the commercial and industrial portfolio.
Net charge-offs came in 33 basis points, which was at the lower end of the guidance range.
The provision for credit losses was $48 million, including a reserve release of $190 million due to lower loan balances and improved economic outlook.
The allowance for credit losses was relatively stable at 2.06% of loans and leases.
Our exposure of COVID sensitive industries was essentially flat at $27 billion.
Truist has strong capital and ended the first quarter with a CET1 ratio of 10.1%.
With respect to capital return, we paid a common dividend of $0.45 per share and had $506 million of share buybacks.
We also redeemed $950 million of preferred stock, resulting in an after-tax charge of $26 million, or $0.02 per share that was not excluded from the adjusted results.
We have $1.5 billion in repurchase authorization remaining under the share repurchase program the Board approved in December.
We intend to maintain approximate 10% CET1 ratio after taking into account strategic actions, stock repurchases and changes in risk-weighted assets.
As a result, we anticipate second quarter repurchases of about $600 million.
This slide shows excellent progress toward the net cost saves of $1.6 billion.
Through fourth quarter, we reduced sourceable spend 9.3% and are closing in on our 10% target.
In terms of retail banking, we closed 226 branches in the first quarter, bringing the cumulative closures to 374.
We are on track to close approximately 800 branches by the first quarter of '22.
We've reduced our non-branch facilities by approximately 3.5 million square feet and are making progress toward the overall target of approximately 5 million square feet.
Average FTEs are down 9% since the merger announcement.
We expect technology savings of $425 million by the end of 2022 compared to 2019.
We are highly committed to our $1.6 billion cost savings target.
Beginning with adjusted non-interest expense and then adjusting for the non-qualified plan and the insurance acquisition expenses, we arrive at a core expense of $3.65 billion.
If you adjust for seasonality of high payroll taxes, equity compensation and variable commissions, core expenses would approach fourth quarter target of $2.94 billion.
Our adjusted return on tangible common equity was 19.36% for the first quarter.
We expect reported net interest margin to be down high-single-digit, driven by a mid-single-digit decrease in core margin and 3 basis points to 4 basis points of purchase accounting accretion run off.
We anticipate net charge-offs in the range of 30 basis points to 45 basis points and a tax rate between 19% to 20%.
And I'm going to take us to Page 20.
Referrals to insurance have increased more than 2.3 times compared to the first quarter of 2020 and more than 50% sequentially.

Summary:
We had strong adjusted net income of $1.6 billion, or $1.18 per share adjusted, both up 42% versus the first quarter of '20.