HBANP — 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 at $0.37, up 9% year-over-year.
• Pre-Provision Net Revenue (PPNR): Increased 36% on an adjusted basis.
• Return on Tangible Common Equity (ROTCE): Achieved 16%-17% target, with a raised target of 18%-19% for 2027.
• Tangible Book Value Growth: Up 9% year-over-year.
• Net Interest Income: Increased 33% year-over-year to $301 million, with a net interest margin (NIM) of 3.24%.
• Loan Growth: Excluding Cadence, loan balances rose 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

• Expansion Initiatives: Continued investment in Carolinas expansion and vertical specialty businesses, with successful integrations of Cadence and Veritex.
• Fee Income Performance: Strong growth in fee revenues, particularly in payments (up 21% year-over-year) and capital markets (up nearly 60% year-over-year).
• AI Investments: Ongoing enterprise-wide AI program aimed at enhancing productivity and efficiency.
• Share Buyback: Announced a new $3 billion share repurchase authorization, with $550 million planned for 2026.

3. Forward Guidance and Outlook

• 2026 Expectations: Anticipated NIM to trend into the high 3.20s, with loan growth expected at the midpoint of the range.
• EPS Guidance for 2027: Projected between $1.90 and $1.93, supported by organic growth and realization of synergies.
• Cost Management: Tightening expense growth expectations to the lower half of the 32.5%-33.5% range, with a focus on maintaining positive operating leverage.

4. Bad News, Challenges, or Points of Concern

• Economic Headwinds: Acknowledgment of a more uncertain macroeconomic environment, with potential impacts on consumer behavior and loan growth.
• Credit Risk: Increased vigilance on commercial real estate, particularly in construction, with a strategic reduction in exposure anticipated over the next two years.
• Competitive Pressures: Noted competition in deposit gathering, particularly in the Midwest, although management remains confident in their strategy and execution.

5. Notable Q&A Insights

• Balance Sheet Optimization: Management is actively optimizing the balance sheet in response to softer economic growth outlook, particularly in commercial real estate.
• Retention of Talent: Strong retention rates among new hires from Cadence and Veritex, with ongoing recruitment efforts to enhance capabilities in Texas and the South.
• Market Valuation Concerns: Management expressed frustration over stock performance not reflecting strong fundamentals, emphasizing a focus on delivering long-term growth and profitability.
• Revenue Synergies: Early successes in revenue synergies from recent acquisitions, particularly in capital markets and payments, with expectations for continued strong growth in fee income.

Overall, Huntington Bancshares reported a solid quarter with strong financial metrics and strategic initiatives, while also acknowledging economic uncertainties and competitive pressures. The company remains focused on executing its growth strategy and managing expenses prudently.