HBANL — Huntington Bancshares Incorporated

Summary of Huntington Bancshares Q2 2026 Earnings Call

1. Key Financial Results and Metrics

• Adjusted PPNR: Increased 12% quarter-over-quarter.
• Net Interest Income (NII): Rose 8.5% sequentially to $2.1 billion.
• Value-Added Fee Revenues: Grew 15%, with organic growth at approximately 30% year-over-year.
• Average Loans: Increased by $15 billion (8.6% sequentially); normalized growth at 1.2%.
• Average Deposits: Grew by $18.8 billion (9.2% sequentially); normalized organic growth at 1.8%.
• Return on Tangible Common Equity (ROTCE): Adjusted ROTCE at 17.5% for Q2, with a target of 18%-19% for 2027.
• Tangible Book Value Growth: Consistent high single-digit to low double-digit growth.
• Credit Performance: Net charge-offs remain low, with a stable portfolio.

2. Strategic Updates and Business Highlights

• Successful completion of the Cadence systems conversion within 235 days, leading to increased customer engagement and deposit growth during the conversion period.
• Focus on organic growth across regions, particularly in Texas and the South, viewed as a significant growth opportunity.
• Strong performance in core banking segments with notable contributions from capital markets, wealth management, and payments.
• Continued investment in technology and operational efficiencies, with a disciplined approach to expense management.

3. Forward Guidance and Outlook

• NII Outlook: Expected to be at the low end or slightly below the guidance range, reflecting competitive deposit pricing pressures and a changing interest rate environment.
• Anticipated high single-digit to low double-digit revenue growth driven by strong loan and fee growth, alongside effective expense management.
• Confidence in achieving $365 million in cost synergies by Q4 and a core efficiency ratio in the mid to low 54% range.
• EPS Target for 2027: $1.90-$1.93, with expectations for strong performance in Q4 2026 as synergies materialize.

4. Bad News, Challenges, or Points of Concern

• Deposit Cost Pressure: Increased competition for deposits and rising funding costs are expected to impact NIM, which may decline further in the near term.
• Loan Growth Moderation: Some segments, particularly auto loans, have seen reduced production due to return concerns, which may affect overall loan growth.
• Market Volatility: The economic environment remains uncertain, with potential impacts from interest rate changes and competitive dynamics in the banking sector.

5. Notable Q&A Insights

• Management expressed confidence in navigating competitive pressures and optimizing the deposit base post-Cadence conversion.
• Discussions highlighted the importance of maintaining a balance between loan growth and return on assets, with a focus on high-quality loans.
• The team emphasized the robust pipeline for future growth and the successful integration of new markets, particularly in Texas, as a strategic advantage.
• Management reiterated their commitment to disciplined expense management and the realization of revenue synergies from recent acquisitions.

Overall, Huntington Bancshares reported a strong quarter with significant growth in key financial metrics, while also addressing challenges related to deposit costs and loan growth moderation. The company remains optimistic about its strategic direction and future earnings potential.