Financial Performance - For Q3 2023, net income was $547 million, or $0.35 per diluted common share, down from $594 million, or $0.39 per diluted common share in Q3 2022[18]. - Net income attributable to Huntington for Q3 2023 decreased to $547 million, an 8% decline from $594 million in Q3 2022[34]. - Year-to-date net income applicable to common shares for 2023 was $1,602 million, reflecting a 6% increase from $1,508 million in 2022[36]. - Net income for the nine months ended September 30, 2023, was $1,723 million, an increase from $1,600 million in the same period of 2022, representing a growth of approximately 7.7%[210]. - The provision for credit losses increased to $276 million in 2023 from $198 million in 2022, indicating a rise of 39.4%[210]. Revenue and Income Sources - Interest income for Q3 2023 increased to $2,313 million, a 46% rise from $1,589 million in Q3 2022[34]. - Noninterest income rose by $11 million, or 2%, to $509 million, driven by a $33 million increase from favorable mark-to-market on pay-fixed swaptions[21]. - Total noninterest income for Q3 2023 was $509 million, a slight increase of 2% compared to $498 million in Q3 2022[34]. - Noninterest income for Consumer & Regional Banking decreased by $26 million, or 3%, mainly due to lower mortgage banking income and service charges[178]. Credit Losses and Provisions - The provision for credit losses decreased by $7 million to $99 million, while the allowance for credit losses (ACL) increased by $138 million to $2.4 billion, or 1.96% of total loans and leases[20]. - The provision for credit losses for Q3 2023 was $99 million, a decrease of 7% from $106 million in Q3 2022[34]. - The total provision for credit losses for the third quarter of 2023 was $99 million, a decrease of $7 million compared to the third quarter of 2022[54]. - The allowance for credit losses (ACL) was $2.368 billion, or 1.96% of total loans and leases, as of September 30, 2023, up from $2.271 billion, or 1.90%, at December 31, 2022[92]. Assets and Liabilities - Total assets increased by $3.7 billion, or 2%, to $186.7 billion, with interest-bearing deposits at the Federal Reserve Bank rising by $4.9 billion, or 100%[22]. - Average assets for Q3 2023 increased by $7.0 billion, or 4%, to $186.6 billion, driven by a $6.1 billion increase in average interest-bearing deposits at the Federal Reserve Bank[41]. - Total loans and leases as of September 30, 2023, amounted to $120.853 billion, compared to $119.523 billion at the end of 2022[70]. - The total interest-bearing liabilities increased by $15.2 billion, or 13%, compared to the previous year[40]. Capital and Equity - The tangible common equity to tangible assets ratio improved to 5.70%, up 15 basis points from December 31, 2022, while the CET1 risk-based capital ratio increased to 10.10%[23]. - Shareholders' equity totaled $18.5 billion at September 30, 2023, an increase of $752 million, or 4%, compared to December 31, 2022[154]. - The consolidated CET1 risk-based capital ratio increased to 10.10% at September 30, 2023, from 9.36% at December 31, 2022[148]. - The total risk-based capital ratio for the consolidated entity was 14.11% at September 30, 2023, compared to 13.09% at December 31, 2022[148]. Market and Economic Outlook - The economic outlook anticipates a slowdown over the next three quarters, with inflation expected to approach 2% by Q3 2024[25]. - The unemployment rate is forecasted to peak at 4.2% in mid-2025, with GDP expected to be 1.9% by the fourth quarter of 2024[82]. - The unemployment rate is projected to rise to 5.5% by the end of 2023, reflecting a 1.8% increase from baseline projections[199]. Operational Efficiency - The efficiency ratio for Q3 2023 was 57.0%, compared to 54.4% in Q3 2022, indicating a decline in operational efficiency[34]. - Total noninterest expense for Q3 2023 was $1.1 billion, up 4% from $1.053 billion in Q3 2022[59]. - Personnel costs increased by $8 million, or 1%, in Q3 2023, reflecting $8 million of severance expense related to staffing efficiencies[59]. Dividends and Shareholder Returns - The quarterly common stock cash dividend declared on October 18, 2023, is $0.155 per share, with estimated cash demands of approximately $224 million per quarter[136]. - Total cash demands for preferred stock dividends are expected to be approximately $38 million per quarter[136]. - Cash dividends declared for common shares were $0.155 per share, totaling $228 million for Q3 2023[208]. Risk Management - The company utilizes various derivative instruments, including interest rate swaps and caps, to manage interest rate risk and minimize earnings fluctuations[106]. - The net interest income at risk for a -200 basis point change scenario was -5.3% as of September 30, 2023, compared to -4.1% at the end of 2022, indicating increased sensitivity to interest rate changes[100]. - Economic value of equity at risk for a +200 basis point change scenario was -6.7% at September 30, 2023, down from -17.3% at December 31, 2022, reflecting improved equity sensitivity[103].
HUNTINGTON BANCS(HBANL) - 2023 Q3 - Quarterly Report