HBANP — Huntington Bancshares Incorporated

Summary of Huntington Bancshares Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Earnings Per Share (EPS): Reported at $0.30; adjusted EPS was $0.37, reflecting a 9% year-over-year increase.
• Revenue Growth: Achieved 11% revenue growth for 2025.
• Adjusted EPS Growth: 16% growth year-over-year.
• Loan Growth: Average loans grew 14.4% year-over-year, with organic loan 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%.
• Credit Quality: Net charge-offs at 24 basis points; criticized asset ratio rose to 4.2% due to Veritex's commercial real estate loans.

2. Strategic Updates and Business Highlights

• Huntington is focused on becoming a leading customer-centered bank, expanding its presence to 21 states.
• Significant investments were made in 2025, including branch expansions in North and South Carolina and Texas, and partnerships with TM Capital and Janney Capital Markets.
• The integration of Veritex was completed efficiently within 187 days, with Cadence expected to close soon, enhancing growth potential in Texas.
• The bank emphasized a "people-first" approach to partnerships, which has fostered goodwill and facilitated smoother integrations.

3. Forward Guidance and Outlook

• For 2026, Huntington expects:
  • NII Growth: Between 10% to 13% on a stand-alone basis, with Cadence contributing an additional $1.85 to $1 billion.
  • Loan Growth: Anticipated at 11% to 12%, with deposits growing at 8% to 9%.
  • Fee Revenue Growth: Expected to increase by 13% to 16%, bolstered by contributions from newly acquired capital markets teams.
  • Core Expenses: Projected to grow by 10% to 11%, with a target efficiency ratio of around 55%.

4. Bad News, Challenges, or Points of Concern

• The criticized asset ratio increased, indicating potential risks in the commercial real estate sector, particularly from the Veritex portfolio.
• The competitive deposit environment remains a challenge, although the bank has managed to maintain disciplined pricing.
• There are concerns about the integration of Cadence and the impact on operational efficiency, although management expressed confidence in achieving synergies.

5. Notable Q&A Insights

• Management clarified that the expense growth guidance includes both cost savings and reinvestments into the business.
• The partnership approach with Veritex and Cadence has been highlighted as a key factor in achieving faster integrations and realizing synergies.
• Questions regarding the sustainability of loan growth and the impact of future rate cuts on deposit beta were addressed, with management expressing confidence in maintaining strong loan growth despite potential headwinds.
• The bank plans to continue investing significantly in technology and digital capabilities, including AI, to drive future growth.

Overall, Huntington Bancshares reported strong financial performance in 2025, with ambitious growth plans and strategic investments positioning the bank for continued success in 2026, despite some challenges in credit quality and competitive pressures.