HBANZ — Huntington Bancshares Incorporated

Summary of Huntington Bancshares Q1 2026 Earnings Call

1. Key Financial Results and Metrics:

• Earnings Per Share (EPS): Reported at $0.25; adjusted EPS was $0.37, reflecting a 9% year-over-year growth.
• Pre-Provision Net Revenue (PPNR): Increased by 36% on an adjusted basis.
• Tangible Book Value: Grew by 9%.
• Return on Tangible Common Equity (ROTCE): Consistently at 16%-17%; raised target to 18%-19% for 2027.
• Net Interest Income: Increased by 18.7% sequentially and 33% year-over-year.
• Net Interest Margin (NIM): Reported at 3.24%, up 9 basis points quarter-over-quarter.
• Loan Growth: Excluding acquisitions, increased by 1.5%.
• Deposit Growth: Core deposits rose by 2.3% quarter-over-quarter.

2. Strategic Updates and Business Highlights:

• Partnerships and Acquisitions: Successful integration of Veritex and Cadence, with the latter's systems migration scheduled for June. The Janney and TM Capital acquisitions have also been integrated, contributing to record capital markets performance.
• Core Business Performance: Strong organic growth across various segments, particularly in capital markets, payments, and wealth management.
• Liquidity Position: Maintained a strong liquidity profile, with available contingent liquidity at approximately 173% of uninsured deposits.
• AI Investments: Ongoing enterprise-wide AI program aimed at improving efficiency and productivity across multiple business areas.

3. Forward Guidance and Outlook:

• 2026 Guidance: Expected to be at the low end of the net interest income growth range due to a more cautious economic outlook.
• NIM Forecast: Adjusted to trend into the high 3.20s, down from mid-3.30s, primarily due to increased cash balances at the Federal Reserve.
• EPS Projection for 2027: Expected to be between $1.90 and $1.93, supported by organic growth and realization of cost and revenue synergies.
• Efficiency Ratio: Anticipated to improve to the mid- to low 54% level by Q4 2026.

4. Bad News, Challenges, or Points of Concern:

• Economic Environment: Acknowledged a more uncertain macroeconomic backdrop, with potential impacts on consumer spending, particularly among lower-income households.
• Loan Growth Adjustments: Revised expectations for loan growth to the midpoint of the range, with a focus on optimizing the balance sheet and managing commercial real estate exposure.
• Competitive Pressures: Facing rational but competitive deposit pricing, which may impact margins.
• Market Valuation: Frustration expressed over the stock's underperformance despite strong fundamentals and growth outlook.

5. Notable Q&A Insights:

• Balance Sheet Optimization: Management is actively tuning the balance sheet in response to economic conditions, particularly in commercial real estate.
• Share Buyback Authorization: A new $3 billion buyback program was approved, reflecting confidence in capital generation and potential Basel III benefits.
• Retention of Talent: Strong retention rates reported post-acquisition, with ongoing efforts to attract new talent to support growth.
• Revenue Synergies: Progress on revenue synergies from acquisitions is encouraging, particularly in capital markets and payments, with expectations for continued strong performance in fee income.

Overall, Huntington Bancshares reported a strong first quarter, with solid financial performance and strategic initiatives in place, while also navigating economic uncertainties and competitive pressures.