HUNTINGTON BANCSHARES DEP(US:HBANM)2023-10-27 17:56Financial 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 applicable to common shares for Q3 2023 was $510 million, down 10% from $565 million in Q3 2022[34]. - Year-to-date net income attributable to Huntington increased to $1,708 million, a 7% rise from $1,593 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, reflecting a growth of approximately 7.7%[210]. - The efficiency ratio for Q3 2023 was 57.0%, compared to 54.4% in Q3 2022, indicating a decline in operational efficiency[34]. - Other comprehensive income (loss) for Q3 2023 was $(616) million, compared to $(1,178) million in Q3 2022[206]. Revenue and Income Sources - Interest income for Q3 2023 increased to $2,313 million, up 46% from $1,589 million in Q3 2022[34]. - Total revenue, FTE (non-GAAP) for 2023 was $5,670 million, a 7% increase from $5,315 million in 2022[36]. - 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 Q3 2023 was $509 million, a 2% increase from $498 million in Q3 2022[205]. Credit Losses and Provisions - The provision for credit losses decreased to $99 million, while the allowance for credit losses (ACL) increased to $2.4 billion, or 1.96% of total loans and leases[20]. - Provision for credit losses for Q3 2023 was $99 million, compared to $106 million in Q3 2022, indicating a decrease of 6.6%[205]. - The provision for credit losses for the first nine months of 2023 was $276 million, an increase of $78 million, or 39%, compared to the year-ago period[54]. - The total provision for credit losses in Q3 2023 was $99 million, a decrease of $7 million compared to Q3 2022[54]. - Net charge-offs (NCOs) for the third quarter of 2023 were $73 million, or 0.24% of average total loans and leases, up from $44 million, or 0.15%, in the same quarter last year[77]. Assets and Liabilities - Total assets increased by $3.7 billion, or 2%, to $186.7 billion, primarily due to a $4.9 billion increase in interest-bearing deposits at the Federal Reserve Bank[22]. - Total assets reached $186.6 billion, marking a $7.0 billion increase, or 4%, from the previous year[41]. - Total liabilities increased by $6.6 billion, or 4%, to $167.8 billion, compared to $161.2 billion in Q3 2022[42]. - 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]. - Cash and cash equivalents increased by $4.7 billion to $11.4 billion at September 30, 2023, primarily due to an increase in interest-bearing deposits at the Federal Reserve Bank[126]. Deposits and Funding - Total deposits amounted to $148.9 billion at September 30, 2023, compared to $147.9 billion at December 31, 2022, reflecting a stable deposit base[124]. - Average interest-bearing deposits increased by $11.5 billion, or 11%, while noninterest-bearing deposits decreased by $9.3 billion, or 22%[42]. - As of September 30, 2023, the total core deposits were $144.2 billion, representing 97% of total deposits, an increase of $2.1 billion from $142.1 billion at December 31, 2022[122]. - Wholesale funding totaled $18.2 billion at September 30, 2023, an increase from $17.5 billion at December 31, 2022, driven by long-term FHLB borrowings and senior notes[129]. Capital and Equity - 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, up from 9.36% at December 31, 2022[148]. - The Bank's Tier 1 leverage ratio was 9.43% at September 30, 2023, compared to 8.60% at December 31, 2022[148]. - The total capitalized MSRs amounted to $547 million, representing the right to service $33.0 billion in mortgage loans as of September 30, 2023[115]. Economic Outlook - The consensus 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 growth projected at 1.9% by the fourth quarter of 2024[82]. - The estimated unemployment rate is projected to rise to 5.5% by the end of 2023, which is 1.8% higher than baseline projections[199]. Strategic Initiatives - Huntington completed the acquisition of Torana in May 2022, enhancing its digital payments capabilities[15]. - The company completed its LIBOR transition efforts by June 2023, moving to a SOFR-based replacement rate for loans and leases[105]. - The organizational realignment in Q2 2023 resulted in two business segments: Consumer & Regional Banking and Commercial Banking[158].