Truist Financial's (TFC) appointment of Mike Lyons as its new chief executive officer increases risk, BofA Securities analysts said in a Wednesday note.

Analysts said that while Lyons has a strong operating background, the external hire is an implicit acknowledgment that nearly seven years after the merger of BB&T and SunTrust, the company's strategy is falling short.

BofA said that these uncertainties, combined with a tougher rate backdrop, mean the stock will likely struggle to outperform until investors gain confidence that Lyons can close the profitability gap relative to peers.

"Lyons will want to give the independent strategy a shot for a few years," analysts said. "In the meantime, the risk of franchise attrition is not immaterial given a fiercely competitive Southeast banking landscape."

BofA downgraded the stock's rating to neutral from buy, with a $56 price target.

Price: 50.05, Change: -1.32, Percent Change: -2.56