Summary of Huntington Bancshares Q2 2026 Earnings Call

1Key Financial Results and Metrics

Adjusted PPNR: Increased 12% quarter-over-quarter.

Net Interest Income (NII): Up 8.5% sequentially to $2.1 billion.

Value-Added Fee Revenues: Grew 15%, with organic growth of approximately 30% year-over-year.

Loan Growth: Average loans increased by $15 billion (8.6% sequentially), with normalized organic growth of $2.2 billion (1.2%).

Deposit Growth: Average deposits rose by $18.8 billion (9.2% sequentially), with normalized organic growth of $4 billion (1.8%).

Return on Tangible Common Equity (ROTCE): Adjusted ROTCE was 17.5% in Q2, with a target of 18%-19% by 2027.

Tangible Book Value Growth: Continued growth at a high single-digit to low double-digit pace.

2Strategic Updates and Business Highlights

Successful completion of the Cadence systems conversion, which was completed 235 days post-announcement, enabling a focus on growth.

Expansion into Texas and the South is viewed as a significant growth opportunity, with a strong pipeline in energy, commercial real estate, and auto floorplan businesses.

The company is leveraging its enhanced capabilities in payments, wealth management, and capital markets, which are contributing to strong fee revenue growth.

The integration of new colleagues and systems has been smooth, with a focus on enhancing customer relationships and deepening primary banking relationships.

3Forward Guidance and Outlook

The company expects continued loan and deposit growth, with a strong pipeline supporting this outlook.

NII is anticipated to be at the low end or slightly below the guidance range due to competitive pressures on deposit costs and a changing interest rate environment.

The fourth quarter is expected to be the strongest, driven by cost synergies from the Cadence integration and ongoing revenue growth.

The company aims for EPS growth of approximately 30% from 2025 levels, targeting $1.90-$1.93 per share in 2027.

4Bad News, Challenges, or Points of Concern

Deposit Costs: Increased competitive pressures on deposit pricing are anticipated, which may impact NII.

Loan Growth: Some headwinds in commercial real estate and auto lending due to a focus on maintaining return thresholds, leading to moderated growth.

Interest Rate Environment: The outlook has shifted from expecting rate cuts to potential rate hikes, which adds uncertainty to NII projections.

Market Reaction: The stock opened down 5% post-announcement, indicating market concerns regarding the revised NII outlook.

5Notable Q&A Insights

Management expressed confidence in achieving revenue growth despite pressures on NII, citing strong loan and fee growth as key drivers.

The competitive landscape for deposits remains challenging, but management believes they can optimize their deposit base effectively.

The conversation highlighted the importance of maintaining return thresholds, particularly in the auto lending segment, which has seen reduced volumes.

Management reiterated their commitment to disciplined expense management and synergy realization, with a focus on achieving their financial targets for 2027. Overall, Huntington Bancshares reported a solid quarter with strong growth metrics, but faces challenges related to deposit costs and loan growth moderation, which could impact future earnings.