Core Viewpoint - The strategic acquisition of Veritex by Huntington is aimed at enhancing Huntington's growth in Texas, particularly in the Dallas/Fort Worth and Houston markets, leveraging Veritex's established local presence and customer relationships [1][2]. Company Overview - Huntington Bancshares is a regional bank holding company with approximately $210 billion in assets, providing a wide range of banking and financial services [13]. - Veritex Community Bank, headquartered in Dallas, has around $13 billion in assets and operates over 30 branches in key Texas markets [14]. Transaction Details - Huntington will acquire Veritex in a 100% stock transaction, issuing 1.95 shares of Huntington for each outstanding share of Veritex, valuing the transaction at approximately $1.9 billion based on Huntington's stock price of $17.39 as of July 11, 2025 [7]. - The transaction is expected to close in early Q4 2025, pending regulatory approvals [6]. Financial Implications - The acquisition is projected to be modestly accretive to Huntington's earnings per share and neutral to regulatory capital at close, with a slight dilution to tangible book value per share [7]. - Huntington's second quarter 2025 earnings per share is expected to be $0.34, reflecting a 13% increase year-over-year [8]. Strategic Goals - The acquisition aligns with Huntington's long-term commitment to Texas, a rapidly growing economy, and aims to enhance its commercial banking capabilities in the region [2][5]. - Huntington plans to maintain and invest in Veritex's branch network to support future growth [3]. Community Engagement - Huntington is committed to continuing Veritex's legacy of community support, with an initial philanthropic investment of $10 million in Texas [5].

Core Viewpoint - Huntington Bancshares Incorporated is set to release its second quarter 2025 financial results on July 18, 2025, prior to market opening, with a conference call scheduled for 9 a.m. ET to discuss the results [1][2]. Company Overview - Huntington Bancshares Incorporated is a regional bank holding company with $210 billion in assets, headquartered in Columbus, Ohio, and operates 968 branches across 13 states [4]. - The company provides a wide range of financial services including banking, payments, wealth management, and risk management to various clients including consumers, small and middle-market businesses, and municipalities [4].

Financial Performance - Huntington's total assets reached $183 billion in 2024[25] - Total deposits amounted to $148 billion in 2024[27] - Total loans reached $120 billion in 2024[29] - Pre-Provision Net Revenue (PPNR) was $2.9 billion in 2024[31] - Return on Tangible Common Equity (ROTCE) was 15.7% in 2024[33] - Adjusted ROTCE was 16% in 2024[33] - The company's Net Charge-off Ratio was 0.30% in FY2024[44] - The company's Allowance for Credit Losses (ACL) was 1.88%[44] Growth & Strategy - Consumer and Business Primary Banking Relationships (PBRs) grew 2% and 3% year-over-year respectively[22] - Adjusted noninterest income increased by 10% year-over-year, reaching $2080 million[40]

Financial Performance & Growth - Huntington National Bank is delivering on organic growth strategies with a diversified customer base[8] - The bank is driving robust profit growth through expanded net interest margin, higher fee revenues, and efficient expense management[8] - The company has a cumulative growth rate of average loans and average deposits[11] - The bank's earnings growth supports capital priorities[29] - The company has a +13% Year-over-Year adjusted CET1 Ratio[32] Asset Quality & Risk Management - The bank is achieving strong credit performance through disciplined client selection and rigorous portfolio management[8] - The bank has a top-tier asset quality and reserve profile[17] - Consumer loans account for 43% of total loans, while commercial loans account for 57%[17, 18] Strategic Initiatives - The company is driving growth via share gains and executional outperformance[26] - The bank is building on a position of strength with national expertise[25] - The management focus is on driving value through accelerated Tangible Book Value (TBV) accretion and expanding long-term returns[37]

Summary of Huntington Bank's Conference Call Company Overview - **Company**: Huntington Bank - **Industry**: Banking and Financial Services Key Points and Arguments Strategic Vision and Goals - Huntington aims to be the leading customer-centered bank in the U.S. by focusing on expertise and customer relationships, which will drive customer acquisition and deepen primary bank relationships [6][7] Financial Performance - In the second quarter, Huntington reported cumulative loan growth of 7.3%, outperforming the peer median by over eight percentage points [8] - Loan balances increased by approximately $2 billion, driven by middle market commercial and industrial, indirect auto, and residential mortgage sectors [9] - The deposit base grew by approximately $1.8 billion in the same quarter, with efforts to reduce deposit costs enhancing net interest margin (NIM) [9] NIM and Revenue Expectations - NIM is expected to trend 2 to 3 basis points higher than previous expectations of 307 basis points for the second quarter and the remainder of the year [10] - Fee income grew about 6% year-over-year, with expectations to sustain this growth in the second quarter [11] Risk Management - Huntington maintains a moderate to low risk appetite, with strong credit performance and a disciplined approach to client selection and portfolio management [7][13] - Expected charge-offs for Q2 are near the first quarter level of 26 basis points, with a focus on monitoring portfolios amid macroeconomic uncertainties [14][60] Growth Opportunities - Huntington is optimistic about growth in new geographic markets, particularly in North and South Carolina and Texas, as well as in specialty commercial verticals [15][16] - The bank has successfully hired experienced bankers in new markets, enhancing its local presence and capabilities [17] Capital Management - Huntington generates approximately 40 basis points of capital each quarter, with plans to maintain an adjusted CET1 ratio in the range of 9% to 10% by mid-year [20][50] - The bank has tactically restructured its securities portfolio, selling corporate bonds to reinvest in higher-yielding securities, which is expected to benefit NIM and ROTCE [21][47] Expense Management - Huntington targets a 1% reduction in baseline operating costs annually, focusing on process reengineering and automation to drive positive operating leverage [41][43] Credit Quality - The bank expects stable credit performance with no significant changes in early-stage delinquencies, supported by a solid credit reserve of 1.87% [60] Regulatory Environment - Huntington is encouraged by the potential for tailored regulations for banks of its size, which could lead to a more prudent regulatory environment [66] Additional Important Insights - The bank's approach to risk management has evolved to include more automation and process-focused capabilities, enhancing its ability to respond to market changes [61][62] - Huntington's competitive advantage in fee-based businesses stems from its strong customer relationships and execution capabilities rather than just product differentiation [53][54] This summary encapsulates the key insights from Huntington Bank's conference call, highlighting its strategic direction, financial performance, risk management practices, and growth opportunities.

Core Insights - Huntington Bancshares (HBAN) shares increased by 3.05% following the decision to divest its corporate trust and institutional custody business to Argent Institutional Trust Company (AITC), indicating a strategic focus on enhancing core financial offerings and long-term profitability [1][4] Divestiture Details - The financial terms of the divestiture remain undisclosed, but it includes the transfer of key client relationships, personnel, and operational infrastructure from Huntington to AITC, while maintaining a strategic relationship for continued service provision [2][6] - Key personnel from Huntington will transition to AITC to ensure service continuity and expertise retention for clients, emphasizing the commitment to client service and financial success [3] Strategic Focus - The divestiture reflects Huntington's strategic shift towards refining operations and strengthening core banking services, aligning with recent expansions in its commercial banking business, particularly in Florida [4][5] - Over the past year, HBAN shares have increased by 28.9%, slightly outperforming the industry growth of 28.4% [5]

Core Insights - Argent Institutional Trust Company (AITC) has entered into a definitive agreement to acquire the corporate trust and institutional custody business of The Huntington National Bank, enhancing AITC's position in the market [1][2] Company Overview - AITC is a leading provider of corporate and institutional trust services, headquartered in Tampa, Florida, and has evolved from Trust Management Incorporated, which was founded in 1954 [7][9] - Following the acquisition, AITC will manage over $175 billion in client assets, solidifying its status as a significant player in the trust services industry [9] Strategic Implications - The acquisition will expand AITC's institutional trust footprint and deepen its capabilities, allowing for a broader range of corporate trust and custody services [2][5] - AITC will maintain an ongoing relationship with Huntington, providing corporate trust, escrow, and custody solutions to Huntington's clients, ensuring continuity and enhanced service offerings [3][6] Integration and Transition - The integration of Huntington's corporate trust and custody business into AITC's platform is expected to be seamless, with a focus on maintaining high service levels for existing clients [6][5] - Key personnel from Huntington will transfer to AITC, ensuring that clients continue to receive exceptional service during and after the transition [3][6]

Core Viewpoint - Huntington Bancshares (HBAN) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Ratings - The Zacks rating system is based on changes in earnings estimates, tracking the Zacks Consensus Estimate for EPS from sell-side analysts for the current and following years [2]. - The Zacks rating upgrade reflects an improvement in Huntington Bancshares' earnings outlook, which is expected to positively impact its stock price [4][6]. Impact of Earnings Estimates on Stock Prices - Changes in a company's future earnings potential, as shown by earnings estimate revisions, are strongly correlated with near-term stock price movements [5]. - Institutional investors often rely on earnings estimates to determine the fair value of stocks, leading to significant price movements based on their buying or selling actions [5]. Recent Performance of Huntington Bancshares - For the fiscal year ending December 2025, Huntington Bancshares is projected to earn $1.43 per share, representing a 15.3% increase from the previous year [9]. - Over the past three months, the Zacks Consensus Estimate for Huntington Bancshares has risen by 3.2%, indicating a positive trend in earnings estimates [9]. Zacks Rank System Overview - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [8]. - The upgrade of Huntington Bancshares to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [11].

Core Viewpoint - Huntington Bancshares Incorporated (HBAN) is expanding its commercial banking operations into Florida, following previous expansions in North Carolina, South Carolina, and Texas, as part of its growth strategy in the middle-market banking sector [1][6]. Group 1: Expansion Strategy - HBAN has hired Josh Sheradsky as senior managing director to lead the new office in Fort Lauderdale, Florida, as part of its commercial banking expansion [2]. - The bank is launching new industry verticals to enhance its commitment to middle-market businesses, providing tailored financial solutions [3]. - Huntington's middle-market banking services include lending, liquidity management, treasury and payments solutions, and capital markets expertise, focusing on a relationship-driven approach [4]. Group 2: Market Position and Growth Plans - Scott Kleinman, president of Huntington Commercial Bank, emphasized the bank's readiness to address the complex needs of diverse companies in Florida, one of the fastest-growing markets [5]. - In January 2025, HBAN introduced two new industry verticals, the Financial Institutions Group and the Aerospace & Defense Group, to further expand its corporate and specialty banking services [6]. - The bank plans to grow its presence in the Carolinas and other key markets, aiming to add over 350 employees and launch approximately 55 retail branches in the next five years [7]. Group 3: Financial Performance - Over the past six months, HBAN's shares have declined by 7.7%, while the industry average fell by 4.3% [8]. - HBAN currently holds a Zacks Rank of 2 (Buy), indicating a favorable outlook compared to other finance stocks [10].

PART I [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=6&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Analysis of Huntington's Q1 2025 financial performance, detailing strong net income, asset growth, and robust capital [Executive Overview](index=6&type=section&id=Executive%20Overview) Huntington reported strong Q1 2025 results with **$527 million** net income, driven by net interest income and asset growth Q1 2025 vs Q1 2024 Financial Highlights | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net Income | $527 million | $419 million | 26% | | Diluted EPS | $0.34 | $0.26 | 31% | | Net Interest Income | $1,426 million | $1,287 million | 11% | | Noninterest Income | $494 million | $467 million | 6% | | Noninterest Expense | $1,152 million | $1,137 million | 1% | | Provision for Credit Losses | $115 million | $107 million | 7% | - The increase in FTE net interest income was primarily due to an **8% ($14.5 billion)** increase in average earning assets and a **9 basis point** increase in the FTE Net Interest Margin (NIM) to **3.10%**[21](index=21&type=chunk) - Total assets reached **$209.6 billion** at March 31, 2025, a **3%** increase from December 31, 2024, driven by growth in loans and interest-earning deposits[24](index=24&type=chunk) - The CET1 risk-based capital ratio improved to **10.6%** at March 31, 2025, up from **10.5%** at the end of 2024, primarily due to earnings retention[25](index=25&type=chunk) [Discussion of Results of Operations](index=10&type=section&id=Discussion%20of%20Results%20of%20Operations) Detailed Q1 2025 results show **11%** net interest income growth and **6%** noninterest income increase Average Balance Sheet YoY Change (Q1 2025 vs Q1 2024) | Balance Sheet Item | Q1 2025 Avg. Balance | YoY Change ($) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | $205.1 billion | +$14.8 billion | +8% | | Total Loans and Leases | $130.9 billion | +$8.9 billion | +7% | | Total Deposits | $162.6 billion | +$10.9 billion | +7% | | Total Liabilities | $185.0 billion | +$14.0 billion | +8% | Noninterest Income Breakdown (Q1 2025 vs Q1 2024) | Category | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Payments and cash management | $155 M | $146 M | +6% | | Wealth and asset management | $101 M | $88 M | +15% | | Capital markets and advisory | $67 M | $56 M | +20% | | **Total Noninterest Income** | **$494 M** | **$467 M** | **+6%** | - Noninterest expense increased **1%** YoY, primarily due to a **$32 million (5%)** rise in personnel costs, partially offset by a **$17 million (31%)** decrease in deposit and other insurance expense[44](index=44&type=chunk) - The provision for income taxes was **$122 million** with an effective tax rate of **18.6%**, compared to **$86 million** and **16.8%** in Q1 2024, mainly due to higher pretax income[46](index=46&type=chunk) [Risk Management](index=15&type=section&id=Risk%20Management) Huntington manages risk through a comprehensive framework, maintaining a moderate-to-low appetite across key risk categories - The company's risk management is structured around a Board-approved Risk Appetite Statement, focusing on seven key risk categories: credit, market, liquidity, operational, compliance, strategic, and reputation[48](index=48&type=chunk) Key Risk Metrics (as of March 31, 2025) | Metric | Value | Source Chunk | | :--- | :--- | :--- | | Total Loans & Leases | $132.5 billion | 52 | | Nonperforming Assets (NPAs) | $804 million | 66 | | NPA Ratio | 0.61% | 66, 67 | | Allowance for Credit Losses (ACL) | $2.5 billion (1.87% of loans) | 81 | | Net Charge-offs (annualized) | 0.26% | 83 | | Primary Contingent Liquidity | $107.4 billion | 125 | [Capital](index=30&type=section&id=Capital) Huntington maintains robust capital, with a **10.6%** CET1 ratio and a new **$1.0 billion** share repurchase authorization Regulatory Capital Ratios (Consolidated) | Ratio | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | CET1 risk-based capital | 10.6% | 10.5% | | Tier 1 risk-based capital | 11.9% | 11.9% | | Total risk-based capital | 14.3% | 14.3% | | Tier 1 leverage | 8.5% | 8.6% | - The increase in the CET1 ratio was driven by current period earnings, net of dividends, which was partially offset by an increase in risk-weighted assets from loan growth and the CECL transition adjustment[149](index=149&type=chunk) - On April 16, 2025, the Board of Directors approved a new share repurchase authorization of up to **$1.0 billion** of common shares[154](index=154&type=chunk) [Business Segment Discussion](index=31&type=section&id=Business%20Segment%20Discussion) Consumer & Regional Banking net income decreased **8%** YoY, Commercial Banking declined **2%**, with Treasury/Other improving Net Income by Business Segment (Q1 2025 vs Q1 2024) | Segment | Q1 2025 Net Income | Q1 2024 Net Income | YoY Change | | :--- | :--- | :--- | :--- | | Consumer & Regional Banking | $319 million | $348 million | -8% | | Commercial Banking | $236 million | $242 million | -2% | | Treasury / Other | ($28 million) | ($171 million) | +84% | | **Total Net Income** | **$527 million** | **$419 million** | **+26%** | - Consumer & Regional Banking's net income decline was driven by a **5%** increase in noninterest expense and a **7 basis point** compression in net interest margin[163](index=163&type=chunk) - Commercial Banking's performance was supported by a **12%** increase in noninterest income, primarily from capital markets and advisory fees, which helped offset a **2%** decline in net interest income[165](index=165&type=chunk) [Additional Disclosures](index=35&type=section&id=Additional%20Disclosures) This section covers forward-looking statements, non-GAAP measures, and critical accounting policies, including ACL sensitivity - The report contains forward-looking statements subject to risks including economic changes, interest rate volatility, and regulatory actions[170](index=170&type=chunk)[172](index=172&type=chunk) - The company's critical accounting policies are the allowance for credit losses (ACL) and goodwill, with ACL estimates highly dependent on macroeconomic forecasts[181](index=181&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk) - A hypothetical 100% adverse economic scenario would increase the quantitative ACL by approximately **$0.8 billion**, excluding qualitative adjustments[186](index=186&type=chunk)[187](index=187&type=chunk) [Financial Statements (Unaudited)](index=40&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Huntington's unaudited consolidated financial statements, including balance sheets, income, and cash flows [Consolidated Balance Sheets](index=40&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$209.6 billion** at March 31, 2025, driven by loan and deposit growth, with equity at **$20.4 billion** Consolidated Balance Sheet Highlights | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $209,596 M | $204,230 M | | Net Loans and Leases | $130,242 M | $127,798 M | | Total Deposits | $165,337 M | $162,448 M | | Total Liabilities | $189,110 M | $184,448 M | | Total Shareholders' Equity | $20,434 M | $19,740 M | [Consolidated Statements of Income](index=41&type=section&id=Consolidated%20Statements%20of%20Income) Net income attributable to Huntington increased to **$527 million** in Q1 2025, driven by higher interest and noninterest income Consolidated Income Statement Summary (Three Months Ended) | Account | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Net Interest Income | $1,426 M | $1,287 M | | Provision for Credit Losses | $115 M | $107 M | | Total Noninterest Income | $494 M | $467 M | | Total Noninterest Expense | $1,152 M | $1,137 M | | Net Income Attributable to Huntington | $527 M | $419 M | | Net Income Per Diluted Share | $0.34 | $0.26 | [Consolidated Statements of Cash Flows](index=44&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash and cash equivalents increased by **$2.46 billion** in Q1 2025, driven by **$4.10 billion** from financing activities Cash Flow Summary (Three Months Ended March 31, 2025) | Activity | Net Cash Flow | | :--- | :--- | | Net Cash Provided by Operating Activities | $513 million | | Net Cash Used in Investing Activities | ($2,150 million) | | Net Cash Provided by Financing Activities | $4,100 million | | **Increase in Cash and Cash Equivalents** | **$2,463 million** | [Notes to Unaudited Consolidated Financial Statements](index=46&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Detailed notes provide disclosures on investment securities, loan portfolio, ACL, debt, derivatives, and commitments - **Note 3:** Total investment securities were **$44.6 billion**, with available-for-sale securities at **$27.8 billion** and held-to-maturity at **$16.3 billion**, resulting in net unrealized losses of **$5.0 billion**[205](index=205&type=chunk)[206](index=206&type=chunk) - **Note 4:** Total loans and leases were **$132.5 billion**, with Commercial loans comprising **57% ($75.4 billion)** and Consumer loans **43% ($57.1 billion)**[220](index=220&type=chunk) - **Note 5:** The Allowance for Credit Losses (ACL) stood at **$2.478 billion**, consisting of **$2.263 billion** for loan and lease losses (ALLL) and **$215 million** for unfunded commitments (AULC)[247](index=247&type=chunk) - **Note 7:** Total long-term debt increased to **$18.1 billion** from **$16.4 billion** at year-end, primarily due to the issuance of **$1.5 billion** in senior notes and a **$415 million** CLN transaction[261](index=261&type=chunk)[263](index=263&type=chunk)[264](index=264&type=chunk) - **Note 13:** The total notional value of derivative contracts was **$101.8 billion**, used for hedging interest rate risk, mortgage banking activities, and customer-related services[317](index=317&type=chunk) - **Note 15:** Commitments to extend credit totaled **$62.5 billion**, primarily in commercial and industrial (**$39.1 billion**) and consumer (**$20.5 billion**) loans[367](index=367&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=84&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section refers to the MD&A's Market Risk section for detailed quantitative and qualitative disclosures - Disclosures regarding market risk for the current period are located in the Market Risk section of the MD&A in this report[381](index=381&type=chunk) [Controls and Procedures](index=84&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of March 31, 2025, with no material changes to internal controls - The Chief Executive Officer and Chief Financial Officer concluded that as of March 31, 2025, Huntington's disclosure controls and procedures were effective[382](index=382&type=chunk) - There were no changes in internal control over financial reporting during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, these controls[383](index=383&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=84&type=section&id=Item%201.%20Legal%20Proceedings) Huntington is involved in routine legal and regulatory actions, with an estimated aggregate possible loss of **$0 to $15 million** - The company is routinely a defendant in legal and regulatory actions, with an estimated aggregate range of reasonably possible loss of **$0 to $15 million** at March 31, 2025, in excess of any amounts already accrued[374](index=374&type=chunk)[385](index=385&type=chunk) [Risk Factors](index=84&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the 2024 Annual Report on Form 10-K for a comprehensive discussion of risk factors - The report refers to the risk factors discussed in the 2024 Annual Report on Form 10-K for a comprehensive understanding of potential risks[386](index=386&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=84&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is not applicable for the reporting period - This item is not applicable for the reporting period[387](index=387&type=chunk) [Other Information](index=84&type=section&id=Item%205.%20Other%20Information) General Counsel Marcy Hingst adopted a Rule 10b5-1 trading plan for the sale of up to **54,800** common shares - On March 13, 2025, General Counsel Marcy Hingst adopted a Rule 10b5-1 trading plan for the sale of up to **54,800** shares of common stock from vested restricted share units[388](index=388&type=chunk) [Exhibits](index=85&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including corporate governance documents and certifications - The exhibit index lists documents filed with the report, including CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1, 32.2) and Inline XBRL data files (Exhibit 101)[393](index=393&type=chunk)