Huntington(US:HBAN)2025-07-18 14:02Financial Data and Key Metrics Changes - Earnings per common share were reported at $0.34, with an adjusted EPS growth of 27% year over year [17][18] - Average loan balances increased by $2.3 billion or 1.8% from the prior quarter, while average deposits rose by $1.8 billion or 1.1% [19][20] - Adjusted common equity tier one (CET1) was 9%, up 40 basis points from last year, while tangible book value per share increased by 16% year over year [10][19] Business Line Data and Key Metrics Changes - Loan balances grew by 7.9% year over year, driven by strength in commercial loans and contributions from new initiatives [21] - New initiatives accounted for approximately 40% of total loan growth, with significant contributions from Texas and North and South Carolina regions [21][22] - Average deposit growth was driven by household growth and deepening primary bank relationships, with a 46% increase year over year in consumer and business banking [10][23] Market Data and Key Metrics Changes - The company maintained a strong liquidity position with two times coverage of uninsured deposits [11] - Credit performance remained stable with net charge-offs at 20 basis points, reflecting proactive management of loan portfolios [11][20] - The criticized asset ratio was reported at 3.82%, indicating stable credit quality [32] Company Strategy and Development Direction - The company is focused on core growth strategies and recently announced the acquisition of Veritex, which is expected to accelerate growth in Texas [6][12] - The acquisition is seen as financially attractive and aligned with the company's model of delivering broad-based capabilities through local relationships [14][15] - The company aims to expand its consumer franchise in Texas and enhance commercial lending and capital markets opportunities [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the economic environment, noting signs of improving sentiment and strong growth momentum [32][34] - The company raised its loan growth outlook to 6% to 8% and deposit growth to 4% to 6% for the remainder of the year [33][34] - Management highlighted the importance of maintaining a disciplined approach to deposit pricing while expanding primary bank relationships [10][34] Other Important Information - The company reported a 12% year-over-year growth in net interest income, with a net interest margin of 3.11% for the second quarter [24][20] - Non-interest income increased by 7% year over year, with key areas of focus such as payments, wealth management, and capital markets growing by 11% [26][29] - The company plans to unveil a new branding campaign to enhance customer acquisition and deepen relationships [37] Q&A Session Summary Question: Concerns about net interest income guidance - Management indicated that they are on track to potentially hit the higher end of the net interest income guidance range, with economic stability being a key factor [45][46] Question: Feedback on Veritex acquisition - Positive feedback was received from shareholders and employees, with expectations of synergies and growth opportunities in Texas [48][49][60] Question: Deposit trends and competition - Management noted strong deposit performance and a stable competitive environment, with expectations for continued solid deposit growth [52][54] Question: Changes in expense guidance - The increase in expense guidance was primarily driven by higher revenue and profit outlook, with a focus on maintaining positive operating leverage [64][66] Question: Loan growth and competitive landscape - Management acknowledged a strong loan growth trajectory, with expectations for continued contributions from new initiatives despite some competitive pressures [68][70] Question: Outlook for North and South Carolina - The company remains optimistic about growth in these regions, with ongoing investments in branch openings and hiring new bankers [75][76] Question: Funding strategy and deposit growth - Management emphasized optimizing funding and loan growth, with expectations for deposit growth to match loan growth over the long term [82][84] Question: Efficiency ratio outlook - Management indicated that while the efficiency ratio has been stable, they expect improvements over time as they continue to invest in growth opportunities [97][100]