Summary of Huntington Bancshares Q2 2026 Earnings Call

1Key Financial Results and Metrics

Earnings Performance: Adjusted Pre-Provision Net Revenue (PPNR) increased by 12% quarter-over-quarter.

Net Interest Income (NII): Rose by 8.5% sequentially to $2.1 billion. However, guidance for NII was adjusted to the low end or slightly below due to rising deposit costs.

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

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

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

Tangible Book Value: Continued growth, with a year-to-date share repurchase of $310 million out of a planned $550 million for 2026.

2Strategic Updates and Business Highlights

Cadence Systems Conversion: Successfully completed, allowing for enhanced operational efficiency and customer engagement. Deposits grew during the conversion period.

Market Expansion: Focus on Texas and the South as key growth areas, with significant increases in deposits and loans in these regions.

Awards and Recognition: Received multiple accolades, including recognition for digital banking and customer satisfaction.

Revenue Synergies: On track to achieve $365 million in cost synergies from the Cadence merger by Q4.

3Forward Guidance and Outlook

Revenue Growth: Anticipated continued high revenue growth, with expectations for strong loan and deposit growth in the second half of 2026.

NII Outlook: Expected to be at the low end of the range or slightly below due to competitive pressures on deposit costs.

EPS Target for 2027: Projected earnings per share of $1.90-$1.93, driven by strong organic growth, expanding fee income, and synergy realization.

Expense Management: Targeting $435 million in annualized run rate cost synergies by Q4, with a core efficiency ratio aimed in the mid to low 54% range.

4Bad News, Challenges, or Points of Concern

NII Guidance Adjustment: The outlook for NII was lowered due to increased deposit costs and competitive pressures, which affected market sentiment.

Loan Growth Moderation: Some headwinds in loan growth, particularly in the auto sector, where volumes were intentionally reduced due to lower returns.

Credit Performance: While overall credit metrics remain strong, there are concerns about elevated non-performing assets (NPAs) and the potential impact of economic conditions on credit quality.

5Notable Q&A Insights

Market Competition: Executives acknowledged competitive pressures on deposit pricing but emphasized their ability to optimize the deposit base post-conversion.

Confidence in Growth: Management expressed confidence in achieving their financial targets despite the adjustments in guidance, citing strong pipelines and ongoing investments in core businesses.

Future Loan Growth: Management noted that loan growth is expected to accelerate in the second half of the year, traditionally their strongest period, with a focus on maintaining a balance between volume and return on assets.

Fee Income Growth: Strong performance in fee income was highlighted, with expectations for continued double-digit growth driven by investments in payments, wealth management, and capital markets. Overall, Huntington Bancshares reported a solid quarter with strong operational execution and strategic advancements, although faced with some challenges related to NII guidance and competitive pressures. The outlook remains positive, with a focus on growth and efficiency in the coming quarters.