HBANM — 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% year-over-year.
• Return on Tangible Common Equity (ROTCE): Achieved a rolling 12-month ROTCE of 16% to 17%, with a raised target of 18% to 19% for 2027.
• Net Interest Income: Increased by 18.7% sequentially and 33% year-over-year, with a net interest margin (NIM) of 3.24%.
• Loan Growth: Excluding acquisitions, loan balances rose by 1.5% or $2.2 billion.
• Deposit Growth: Core deposits increased by $3.8 billion or 2.3% quarter-over-quarter.

2. Strategic Updates and Business Highlights

• Huntington is focusing on a diversified super-regional bank model, with successful expansions in the Carolinas and Texas.
• Integration of recent acquisitions (Cadence, Veritex, Janney, and TM Capital) is on track, with Veritex fully integrated and Cadence's systems migration scheduled for June.
• Strong performance in fee-generating services, particularly in capital markets, payments, and wealth management, with capital markets achieving record revenues.
• The bank is implementing a comprehensive AI program to enhance operational efficiency across various functions.

3. Forward Guidance and Outlook

• 2026 Guidance: The bank expects to achieve an EPS of $1.90 to $1.93, with ROTCE between 18% and 19%.
• NIM Outlook: Adjusted to trend into the high 3.20s, down from mid-3.30s, due to increased cash balances at the Fed and competitive deposit pricing.
• Expense Management: Targeting lower expense growth in response to macroeconomic conditions, with an efficiency ratio expected in the mid- to low 54% range by Q4 2026.

4. Bad News, Challenges, or Points of Concern

• Economic Environment: The bank acknowledges a more uncertain macroeconomic outlook, with potential impacts on loan growth and profitability.
• Competitive Pressures: Increased competition in deposit pricing is noted, although management believes it remains rational.
• Credit Risks: Monitoring of commercial real estate, particularly construction loans, is ongoing, with plans to reduce exposure organically over time.

5. Notable Q&A Insights

• Management emphasized the importance of maintaining a strong liquidity position, especially in light of geopolitical concerns.
• Discussions on balance sheet optimization highlighted a cautious approach to loan growth, particularly in commercial real estate.
• The $3 billion share repurchase authorization was explained as a strategic move to allow flexibility for future capital distributions, with a current guidance of $550 million in repurchases for the year.
• Retention of talent from recent acquisitions is a focus, with management expressing confidence in their ability to integrate new teams effectively while maintaining a strong company culture.

Overall, Huntington Bancshares reported a strong first quarter with robust financial metrics and strategic initiatives, while also acknowledging challenges related to economic uncertainties and competitive pressures. The outlook remains positive, with clear targets for growth and profitability.