HUNTINGTON BANCSHARES INC - 10-Q Summary (Q1 2026)
Business Context and Reporting Period
This report covers the quarterly period ended March 31, 2026. Huntington Bancshares Inc. is a multi-state diversified regional bank holding company headquartered in Columbus, Ohio. The quarter was significantly defined by the completion of two major acquisitions: Veritex Holdings, Inc. (closed October 20, 2025) and Cadence Bank (closed February 1, 2026). These transactions expanded the company's footprint and asset base substantially.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 | Change |
|---|---|---|---|
| Net Income (Attributable to Huntington) | $523 million | $527 million | -$4 million (-1%) |
| Diluted EPS | $0.25 | $0.34 | -$0.09 (-26%) |
| Net Interest Income (NII) | $1,891 million | $1,426 million | +$465 million (+33%) |
| Noninterest Income | $682 million | $494 million | +$188 million (+38%) |
| Noninterest Expense | $1,774 million | $1,152 million | +$622 million (+54%) |
| Provision for Credit Losses | $158 million | $115 million | +$43 million (+37%) |
| Total Assets (Period End) | $285.4 billion | $225.1 billion (Dec 2025) | +$60.3 billion (+27%) |
| Total Loans and Leases | $188.8 billion | $149.6 billion (Dec 2025) | +$39.2 billion (+26%) |
| Net Interest Margin (FTE) | 3.24% | 3.10% | +14 bps |
| CET1 Risk-Based Capital Ratio | 10.2% | 10.4% (Dec 2025) | -20 bps |
| Allowance for Credit Losses (ACL) | $3.37 billion | $2.74 billion (Dec 2025) | +$625 million |
Material Changes vs. Prior Period
- Acquisition Impact: The Cadence acquisition added $51.3 billion in assets and $43.5 billion in deposits. The Veritex acquisition added $12.0 billion in assets. These deals drove the 27% increase in total assets and the 33% increase in average earning assets.
- Earnings Dilution: While net income remained relatively flat year-over-year, diluted EPS declined 26% due to a significant increase in share count (from 1.48 billion to 1.90 billion diluted shares) resulting from stock issued for acquisitions. Additionally, Q1 2026 included $263 million in acquisition-related expenses and $8 million in CECL initial provision expense related to Cadence.
- Expense Growth: Noninterest expenses rose 54% year-over-year. Excluding $263 million of acquisition-related costs, organic expenses increased 31%, driven by higher personnel costs and technology services.
- Credit Quality: Net charge-offs increased to $111 million (0.26% annualized) from $86 million. Nonperforming assets (NPAs) rose to $1.36 billion, primarily due to $295 million in NPAs assumed from Cadence.
Guidance, Outlook, and Risks
- Outlook: Management maintains a "moderate-to-low" risk appetite. The company expects continued organic growth supported by the expanded franchise. The Federal Reserve is projected to restart rate cuts in 2026, with an average federal funds rate of 3.2%.
- Capital Management: The Board approved a new share repurchase authorization of up to $3.0 billion on April 22, 2026, replacing the previous $1.0 billion authorization. The company repurchased $150 million of shares in Q1 2026.
- Risks and Contingencies:
- Macroeconomic Uncertainty: Risks include geopolitical instability (Middle East, Ukraine), energy price volatility, and potential tariff impacts on inflation and GDP.
- Commercial Real Estate (CRE): Management maintains specific risk profiles for office loans due to falling property values and demand uncertainty. The CRE portfolio grew to $24.3 billion, with a 3.4% allowance coverage.
- Regulatory Changes: Proposed rulemakings to modernize the U.S. regulatory capital framework could impact capital requirements and risk-weighted asset calculations.
- Cybersecurity: Ongoing threats require continuous investment in defense-in-depth strategies.
Investor Verification Checklist
- Verify the integration progress and synergy realization of the Cadence and Veritex acquisitions, specifically regarding cost savings and deposit retention.
- Monitor the trajectory of the Allowance for Credit Losses (ACL) as the acquired loan portfolios are fully integrated and seasoned.
- Assess the impact of the new $3.0 billion share repurchase authorization on future EPS accretion.
- Review the performance of the Commercial Real Estate portfolio, particularly the office sector, against the company's specific risk profiles.
- Track the effectiveness of the company's liquidity management as uninsured deposits increased to $68.3 billion (31% of total deposits).