Company Overview - Huntington Bancshares Incorporated (HBAN) is a regional bank holding company based in Columbus, Ohio, providing a comprehensive range of banking services primarily in the U.S. Midwest and surrounding states, with a market capitalization of approximately $22.4 billion [1] Stock Performance - HBAN shares have underperformed the broader market, declining 3.1% over the past 52 weeks, while the S&P 500 Index has increased by 17.4%. Year-to-date, HBAN is down 6.3%, compared to the S&P 500's 16% return [2] - The stock has also lagged behind the Financial Select Sector SPDR Fund (XLF), which has returned 10.8% over the past 52 weeks and 8.1% year-to-date [3] Recent Developments - The recent decline in HBAN stock is largely due to investor concerns regarding its $7.4 billion all-stock acquisition of Cadence Bank, which may lead to near-term dilution of tangible book value and a pause in share buybacks until the integration is completed [4] - Broader caution in the regional banking sector, driven by margin pressures, funding cost risks, and economic uncertainty, has negatively impacted sentiment towards HBAN, despite relatively stable fundamentals [5] Earnings Outlook - For the fiscal year ending December 2025, analysts project HBAN's earnings per share (EPS) to grow by 20.2% year-over-year to $1.49. The company has a strong earnings surprise history, having beaten or matched bottom-line estimates in the last four quarters [5] Analyst Ratings - Among 22 analysts covering HBAN, the consensus rating is a "Strong Buy," an upgrade from "Moderate Buy" two months ago. This rating is based on 16 "Strong Buy" ratings, one "Moderate Buy," four "Holds," and one "Strong Sell" [6] - The current analyst configuration is more bullish than two months ago, when 15 analysts had a "Strong Buy" rating [7]

Group 1 - Huntington Bancshares Incorporated announced a decrease in its prime rate from 7.25% to 7.00%, effective October 30, 2025 [1] - The previous change in the prime rate occurred on September 18, 2025, when it decreased from 7.5% to 7.25% [1] Group 2 - Huntington Bancshares Incorporated is a regional bank holding company with $223 billion in assets, headquartered in Columbus, Ohio [2] - The company provides a comprehensive suite of banking, payments, wealth management, and risk management products and services to various clients, including consumers and businesses [2] - Huntington operates over 1,000 branches across 14 states [2] Group 3 - Huntington Bancshares Incorporated has entered into a definitive agreement to acquire Cadence Bank, which has $53 billion in assets [3]

Financial Performance - For Q3 2025, Huntington reported net income of $629 million, or $0.41 per diluted common share, compared to $517 million, or $0.33 per diluted common share in Q3 2024, representing a 22% increase in net income [24]. - Net interest income for Q3 2025 was $1.5 billion, an increase of $155 million, or 11%, from the previous year, with FTE net interest income rising by $159 million, or 12% [25]. - Noninterest income reached $628 million, up $105 million, or 20%, driven by gains in various revenue streams including payments and cash management [27]. - The efficiency ratio improved to 57.4% in Q3 2025, down from 59.4% in Q3 2024, indicating better cost management [21]. - Return on average total assets increased to 1.19% in Q3 2025, compared to 1.04% in Q3 2024, reflecting improved profitability [21]. - Net income attributable to Huntington for the nine months ended September 30, 2025, was $1,692 million, an increase of $282 million, or 20%, compared to $1,410 million for the same period in 2024 [181]. Credit Losses and Provisions - The provision for credit losses rose by $16 million, or 15%, to $122 million in Q3 2025, with the allowance for credit losses increasing to $2.6 billion, or 1.86% of total loans and leases [26]. - Provision for credit losses for Q3 2025 was $122 million, an increase of $16 million, or 15%, compared to Q3 2024 [51]. - The provision for credit losses in Consumer & Regional Banking increased by $79 million, or 35%, primarily due to higher net charge-offs and loan growth [182]. - Net charge-offs (NCOs) were $75 million, or 0.22% of average total loans and leases, a decrease from $93 million, or 0.30%, in the same quarter last year [82]. - The total net charge-offs for the first nine months of 2025 were $227 million, compared to $275 million for the same period in 2024 [100]. Assets and Liabilities - Total assets increased to $210.2 billion, up $6.0 billion or 3% from December 31, 2024, driven by a $7.9 billion or 6% increase in loans and leases [28]. - Total liabilities rose to $187.9 billion, an increase of $3.5 billion or 2%, primarily due to a $2.8 billion or 2% increase in total deposits [28]. - Average assets for Q3 2025 were $209.7 billion, an increase of $11.4 billion, or 6%, from Q3 2024, driven by a 9% increase in average loans and leases [40]. - Total deposits increased by $2.8 billion, or 2%, to $165.2 billion at September 30, 2025, compared to $162.4 billion at December 31, 2024 [131]. Equity and Capital - Tangible common equity to tangible assets ratio improved to 6.8% from 6.1% year-over-year, reflecting increased earnings and improved AOCI [29]. - The CET1 risk-based capital ratio was 10.6% at September 30, 2025, slightly up from 10.5% at December 31, 2024 [29]. - Shareholders' equity totaled $22.2 billion at September 30, 2025, an increase of $2.5 billion, or 13%, compared to December 31, 2024 [171]. - The total risk-based capital ratio was 14.7% at September 30, 2025, compared to 14.3% at December 31, 2024 [166]. - The company has an active program for managing capital and believes current levels of regulatory capital and shareholders' equity are adequate [164]. Mergers and Acquisitions - Huntington completed the acquisition of Veritex Holdings, issuing approximately $1.7 billion in total consideration, with Veritex holding $12.8 billion in assets as of September 30, 2025 [17]. - Huntington announced a definitive merger agreement with Cadence Bank, valued at approximately $7.4 billion, expected to close in Q1 2026 [18]. Economic Environment - The labor market faced challenges with an unemployment rate of 4.3%, but consumer spending remained robust, indicating a transitional phase rather than a downturn [34]. - The Federal Reserve reduced the federal funds rate by 25 basis points in September 2025, marking the first adjustment since December 2024 [33]. - The company continues to assess macroeconomic uncertainties, including inflation and geopolitical instability, which may impact future credit quality and economic performance [91]. Noninterest Expenses - Noninterest expense was $1.2 billion, an increase of $116 million, or 10%, primarily due to higher personnel costs and acquisition-related expenses from the Veritex acquisition [27]. - Personnel costs increased by $73 million, or 11%, in Q3 2025, primarily due to higher incentive compensation and salary expenses [59]. Interest Rate Risk Management - The cumulative total deposit beta was 32% following the start of the current falling rate cycle in Q3 2024, impacting interest expense and overall deposit costs [106]. - The net interest income at risk (NII at Risk) for a +200 basis point shift in interest rates is projected to be 1.7% as of September 30, 2025, compared to 2.0% at December 31, 2024 [109]. - The Economic Value of Equity at Risk (EVE at Risk) showed a sensitivity of -7.7% for a +200 basis point shift in interest rates as of September 30, 2025, down from -12.6% at December 31, 2024 [113]. - The company utilized various derivative instruments, including interest rate swaps and floors, to manage interest rate risk and minimize fluctuations in earnings [114].

Core Insights - Huntington Bancshares Incorporated (HBAN) has agreed to acquire Cadence Bank for approximately $7.4 billion in an all-stock transaction, enhancing its strategic presence in the South, particularly in Texas and Mississippi [1][9]. Deal Terms & Financial Details - Cadence shareholders will receive 2.475 shares of Huntington common stock for each share of Cadence, valuing Cadence shares at $39.77 based on Huntington's closing price of $16.07 on October 24, 2025 [2]. - The transaction is expected to be 10% accretive to Huntington's earnings per share, mildly dilutive to regulatory capital at close, and 7% dilutive to tangible book value per share, with an earn-back period of about three years [3]. Strategic Rationale - The acquisition is a significant step in Huntington's long-term strategy to build a nationwide, customer-centered banking franchise focused on high-growth markets [5]. - The deal expands Huntington's footprint in high-growth markets, including major metropolitan areas such as Houston, Dallas, and Atlanta, positioning the combined company as a top player in several states [7][9]. Market Position & Expansion - Post-acquisition, Huntington will rank fifth by deposit market share in both Dallas and Houston, and eighth in Texas overall, while also becoming a top-10 bank in Alabama and Arkansas by deposits [6]. - The merger will extend Huntington's franchise to 21 states and establish a strategic presence in 12 of the 25 largest U.S. metropolitan areas, including six of the ten fastest-growing regions [7][9]. Recent Expansion Efforts - Huntington has been actively expanding its presence in Texas and other high-growth regions through targeted mergers, including a recent acquisition of Veritex Holdings, Inc. [8]. - The company has also broadened its middle-market banking presence in Texas and introduced new verticals to enhance its service offerings [11][12]. Performance Metrics - Over the past six months, Huntington's shares have increased by 6.8%, outperforming the industry's growth of 5.3% [13].

Core Viewpoint - Huntington Bancshares is acquiring Cadence Bank for $7.4 billion in an all-stock deal, marking a significant move in the regional banking sector [1][4][6] Group 1: Acquisition Details - The acquisition will provide Cadence investors with 2.475 shares of Huntington stock for each share they own, valuing Cadence shares at $39.77, which is a 9% premium over its previous closing price [3] - The deal is expected to close in the first quarter of 2026 [3] Group 2: Strategic Significance - This acquisition will enhance Huntington's presence in key markets, particularly in Texas, Mississippi, Alabama, and Arkansas, making it the largest bank in Mississippi and a top 10 bank in Alabama and Arkansas by deposits [4][5] - Following the merger, Huntington will operate in 21 states and cover 12 of the top 25 metropolitan statistical areas in the U.S., indicating a substantial expansion of its market footprint [5] Group 3: Market Reaction - Following the announcement, shares of Cadence Bank rose approximately 3%, while Huntington's shares fell by 4% [1][6] - Year-to-date, Cadence Bank shares have increased by 10%, whereas Huntington Bancshares shares have decreased by 4% [6]

Core Insights - Huntington Bank is targeting approximately $365 million in pre-tax cost synergies from its integration with Cadence Bank, aiming for a 30% reduction in non-interest expenses by 2027 [2][3] - The integration process is described as well-mapped and highly confident, with no branch closures planned, indicating a transformational opportunity for the combined entity [3][4] - The acquisition of Cadence, alongside the recent acquisition of Veritex, positions Huntington Bank strongly in Texas, where it aims to capture significant market share [5][8] Company Strategy - The integration of Cadence and Veritex is expected to enhance Huntington Bank's footprint in Texas, specifically in Dallas and Houston, where it will rank fifth in market share [8][9] - The company is focused on organic growth, having achieved record growth in the third quarter and maintaining optimism for continued growth into the next year [7][9] - Huntington Bank is already the number one SBA lender in Texas, with $5 billion in loans, and aims to leverage this position for further economic growth [13][14] Industry Outlook - The current administration is seen as constructive for business generation, suggesting a potential increase in mergers and acquisitions within the banking industry, though not expected to lead to a flood of activity [10][11] - The appeal of expanding in Texas is attributed to significant population migration and economic growth, positioning Huntington Bank favorably in a rapidly growing market [12][13]

Core Insights - Huntington Bancshares is acquiring Cadence Bank for $7.4 billion, marking a significant move in the banking sector as consolidation becomes more viable for banks under pressure [1][2] - The acquisition will increase Huntington's assets to approximately $276 billion and enhance its status among "super-regional" banks, facilitating its expansion into southern markets where Cadence operates [2][3] Industry Context - The banking sector is experiencing a wave of regional and community bank consolidations, driven by the need to compete with larger institutions like JPMorgan Chase and Bank of America [3][4] - The regulatory environment is perceived as favorable for such consolidations, with recent multibillion-dollar deals indicating a trend towards increased mergers and acquisitions in the banking industry [3][4] Recent Transactions - Other notable recent deals include Fifth Third Bancorp's acquisition of Comerica for $10.9 billion and PNC's $4.1 billion acquisition of FirstBank [4] - Additionally, FNBO's acquisition of Country Club Bank was completed recently, further illustrating the trend of consolidation among banks [5] Regulatory Environment - The Federal Deposit Insurance Corporation (FDIC) is facing a shortage of bank examiners, which could impact the regulatory landscape and the pace of bank consolidations [5][6] - The FDIC's Office of Inspector General has acknowledged the potential effects of a hiring freeze and restructuring on oversight capabilities, which may influence the timing and execution of future bank mergers [6][7]

Core Points - Huntington Bank (HBAN.US) has agreed to acquire Cadence Bank (CADE.US) for $7.4 billion, marking its second significant acquisition this year aimed at expanding its operations in the southern and southeastern states [1][2] - The acquisition will increase Huntington Bank's footprint to 21 states, adding over 390 Cadence Bank branches and elevating its market share in rapidly growing metropolitan areas like Dallas and Houston to fifth place, while ranking first in Mississippi [1][3] - The deal is part of a broader trend among regional banks in the U.S. as regulatory barriers to consolidation have eased, with other recent significant transactions including Fifth Third Bank's $10.9 billion acquisition of Comerica and PNC Financial Services' $4.1 billion acquisition of First Bank Holding Company [1] Financial Details - Huntington Bank will pay $39.77 per share for Cadence Bank, representing a 9% premium over Cadence's closing price on October 25 [2] - The transaction is expected to dilute Huntington Bank's tangible book value per share by 7% [2] - Following the acquisition, Huntington Bank's total assets will increase to $276 billion, surpassing a critical regulatory threshold that imposes stricter capital, liquidity, and compliance requirements [2] Strategic Expansion - The acquisition will accelerate Huntington Bank's expansion in southeastern states, including Georgia, Tennessee, and Florida, with the combined entity expected to operate approximately 1,450 branches across 21 states, reaching 56% of the U.S. population [3] - The transaction is anticipated to close in the first quarter of 2026, pending regulatory and shareholder approvals [3] - During due diligence, Huntington Bank reviewed over 80% of Cadence Bank's loan portfolio, assessing credit quality and risk policies [3] - Cadence Bank's team and branches will operate under the Huntington Bank brand, with Cadence's CEO joining Huntington's board as a non-executive vice chairman [3]

Summary of Huntington Bancshares Conference Call Company Overview - **Company**: Huntington Bancshares (NasdaqGS: HBAN) - **Event**: M&A Announcement regarding the partnership with Cadence - **Date**: October 27, 2025 Key Points Industry Context - Huntington Bancshares is positioning itself as a significant player in the banking industry, particularly in high-growth markets such as Texas and the South, through strategic mergers and acquisitions [3][4][5]. Partnership with Cadence - The partnership with Cadence is a strategic milestone, making Huntington the 10th largest bank in the U.S. with a strong presence in core and high-growth markets [3][4]. - Cadence has over 390 branches and 1 million customers, enhancing Huntington's footprint across 21 states and increasing its market penetration [4][5]. - The combination is expected to yield significant cost synergies, enhancing Huntington's return on capital [4][8]. Financial Metrics - The transaction is valued at $7.4 billion, with a pro forma ownership split of 77% Huntington and 23% Cadence [21]. - Expected accretion to 2027 earnings per share (EPS) is approximately 10%, with a projected return on tangible common equity (ROTCE) increase of 200 basis points to 18-19% [8][21]. - The deal is structured as an all-stock transaction, with Cadence shareholders receiving 2.475 Huntington shares for each Cadence share [21]. Growth Strategy - Huntington aims to drive organic growth through its differentiated operating model, which has proven successful in various markets [12][25]. - The partnership is expected to unlock significant growth opportunities in Texas, particularly in the Texaplex region, which is projected to lead U.S. population growth [17][18]. - The combined organization will have a strong presence in key markets, including Houston and Dallas, where it will rank among the top five banks by deposits [18][19]. Integration and Synergies - The integration process is well-planned, with a focus on maintaining local leadership and preserving customer relationships [11][54]. - Huntington has identified $365 million in pre-tax cost synergies, representing 30% of Cadence's forecasted 2027 cash non-interest expense [24]. - The company expects to realize 75% of these synergies in 2026, with full run rate in 2027 [24]. Cultural Alignment - There is a strong cultural alignment between Huntington and Cadence, both emphasizing customer service and community engagement [20][43]. - The leadership teams from both organizations have engaged in extensive planning to ensure a smooth integration process [9][11]. Market Outlook - The partnership enhances Huntington's ability to compete in attractive markets, with a focus on delivering value to shareholders, customers, and communities [28][29]. - The company is optimistic about growth in both Texas and other high-growth areas such as the Carolinas and Florida [50][51]. Conclusion - Huntington Bancshares is poised for significant growth and enhanced market presence through its strategic partnership with Cadence, focusing on operational efficiency, cultural alignment, and strong financial returns [28][63].

Group 1 - Huntington Bancshares announced a definitive agreement to acquire Cadence Bank for $7.4 million, marking a significant move in the regional bank consolidation trend [1] - The acquisition highlights Huntington Bancshares' strategy to expand its footprint in the banking sector, particularly in the southeastern United States where Cadence Bank operates [1] - The deal is part of a broader trend of regional banks consolidating to enhance their competitive positioning and operational efficiencies [1] Group 2 - Huntington Bancshares has shown improved relative strength in its stock performance, earning an upgrade to its IBD Relative Strength Rating [3] - Despite the upgrade, Huntington Bancshares is still below key performance benchmarks, indicating potential for further growth [3] - The company is recognized for its rising relative price performance, suggesting positive market sentiment and investor interest [3]