Summary of Huntington Bancshares (HBANL) Q4 2025 Earnings Call

1Key Financial Results and Metrics

Earnings Per Share (EPS): Reported at $0.30; adjusted EPS (excluding acquisition-related expenses) was $0.37, a 9% increase year-over-year.

Revenue Growth: 11% increase for the full year 2025.

Loan Growth: Average loans grew 14.4% year-over-year, with organic growth of $10.1 billion, exceeding the $9.5 billion from the Veritex partnership.

Deposit Growth: Average deposits increased 5.1% quarter-over-quarter and 8.6% year-over-year.

Net Interest Income (NII): Grew by $86 million (5.6% sequentially) and 14% year-over-year, with a net interest margin of 3.15%.

Operating Expenses: Core expenses increased by only $7 million sequentially, reflecting disciplined cost management.

Credit Quality: Net charge-offs at 24 basis points, with a criticized asset ratio of 4.2%.

2Strategic Updates and Business Highlights

Huntington is focused on becoming a leading customer-centered bank, expanding its presence to 21 states, particularly in fast-growing regions.

Strategic investments included branch expansions in North and South Carolina and middle-market banking in Texas.

Partnerships with Veritex and Cadence are progressing well, with Veritex integration completed efficiently and Cadence expected to close soon.

The bank is enhancing its capabilities through acquisitions, including TM Capital and Janney Capital Markets, to bolster financial advisory and capital markets services.

3Forward Guidance and Outlook

2026 Guidance:

NII growth expected between 10% to 13%.

Loan growth anticipated at 11% to 12%, with deposit growth of 8% to 9%.

Fee revenue growth projected at 13% to 16%, bolstered by new capital markets teams and existing growth in payments and wealth management.

Core expenses expected to grow by 10% to 11%, with a targeted operating leverage of 150 to 200 basis points.

Net charge-offs projected between 25 to 35 basis points.

4Bad News, Challenges, or Points of Concern

Credit Quality Risks: The criticized asset ratio increased due to Veritex's commercial real estate loans, which could pose future risks.

Competitive Pressures: The deposit environment remains competitive, and managing down beta effectively is crucial amid potential rate cuts.

Integration Challenges: While the integration of Veritex is complete, the upcoming integration of Cadence presents operational risks and requires careful management to realize synergies.

5Notable Q&A Insights

Expense Guidance Clarification: Management provided clarity on expense growth, indicating that the baseline for core expenses is approximately $4.87 billion, with growth driven by both cost savings and reinvestments.

Partnership Approach: The management emphasized the collaborative nature of their partnerships with Veritex and Cadence, which has facilitated quicker decision-making and integration, enhancing revenue and cost synergies.

Future M&A Potential: While management is focused on organic growth, they remain open to strategic acquisitions that align with their growth objectives, though they will avoid auctions or mergers of equals.

Investment in Technology: Significant investments in digital capabilities, including AI, are planned to enhance customer experience and operational efficiency, with a sustained investment growth rate of around 20%. Overall, Huntington Bancshares showcased strong financial performance in Q4 2025, with a positive outlook for 2026, while also acknowledging the challenges and risks associated with credit quality and competitive pressures.