Financial Performance - Net income for Q1 2023 was $602 million, or $0.39 per diluted common share, compared to $460 million, or $0.29 per diluted common share in Q1 2022, representing a 31% increase [18]. - Noninterest income for Q1 2023 was $512 million, an increase of $13 million, or 3%, primarily due to the gain from the RPS business sale [22]. - The company reported net credit losses (NCOs) of $57 million, or 0.19% of average total loans and leases, an increase from $19 million, or 0.07%, in the prior year [59]. - The provision for income taxes in Q1 2023 was $144 million, with an effective tax rate of 19.2%, compared to $105 million and 18.5% in Q1 2022 [47]. - The company declared cash dividends of $228 million on common stock and $29 million on preferred stock in Q1 2023 [183]. Interest Income and Margin - Net interest income increased to $1.4 billion, up $263 million, or 23% from the previous year, driven by a 52 basis point increase in the net interest margin (NIM) to 3.40% [20]. - Average total earning assets rose by $6.7 billion, or 4%, contributing to the NIM expansion, which was influenced by higher loan and lease yields [37]. - Huntington's net interest margin (NIM) for Commercial Banking improved to 3.94%, a 22% increase from 3.24% in the previous year [146]. Loans and Credit Losses - The provision for credit losses rose to $85 million, an increase of $60 million from the year-ago quarter, reflecting higher realized net credit losses and allowance builds [21]. - The total provision for loan and lease losses was $78 million, with an additional $7 million for unfunded lending commitments [43]. - The total loan and lease portfolio increased to $121.2 billion at March 31, 2023, up from $119.5 billion at December 31, 2022 [57]. - Nonaccrual loans and leases (NALs) decreased to $533 million, or 0.44% of total loans and leases, from $569 million, or 0.48%, at December 31, 2022 [61]. Assets and Deposits - Total assets as of March 31, 2023, were $189.1 billion, an increase of $6.2 billion, or 3%, compared to December 31, 2022 [23]. - Total deposits decreased to $145.3 billion at March 31, 2023, down from $147.9 billion at December 31, 2022, representing a decline of 1.1% [109]. - Core deposits were $140.4 billion at March 31, 2023, comprising 97% of total deposits, a decrease from $142.1 billion at December 31, 2022 [107]. Economic Outlook - The company expects a mild recession in 2023, with growth anticipated to return in 2024, while inflation is expected to moderate [27]. - The baseline economic scenario forecasts an unemployment rate increase to 4.0% by the end of 2024 and a GDP growth of 2.6% by the same period [67]. - The unemployment rate is projected to reach 7.1% and 7.3% by the end of 2023 and 2024, respectively, under adverse economic conditions [173]. Organizational Changes - The company executed an organizational realignment, consolidating three business segments into a new segment called Consumer & Regional Banking, effective from Q2 2023 [140]. - The average number of employees increased by 476, or 2%, to 20,198 in Q1 2023 [46]. Shareholder Returns - The company authorized a share repurchase program of up to $1.0 billion, with no shares repurchased in the first quarter of 2023 [138]. - Shareholders' equity increased by $1.0 billion or 6% to $18.8 billion at March 31, 2023, driven by earnings and improved AOCI [135]. Securities and Investments - Total available-for-sale securities increased to $27,410 million at March 31, 2023, from $27,103 million at December 31, 2022, representing a growth of 1.14% [197]. - The total amount of past due loans and leases reached $1,029 million as of March 31, 2023, compared to $1,083 million as of December 31, 2022 [208]. Risk Management - The company maintains a contingency funding plan to address liquidity crises, assessing potential erosion of funds due to various events [106]. - The company continues to assess macroeconomic uncertainties, including geopolitical instability and inflation levels, which may impact the ACL estimates [71].
HUNTINGTON BANCS(HBANL) - 2023 Q1 - Quarterly Report