HUNTINGTON BANCSHARES INC - 10-Q Summary (Q2 2026)
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2026. Huntington Bancshares Inc. is a multi-state diversified regional bank holding company headquartered in Columbus, Ohio, operating over 1,400 branches in 21 states. The reporting period is significantly impacted by two major acquisitions: Veritex Holdings, Inc. (closed October 20, 2025) and Cadence Bank (closed February 1, 2026). Results for the current period reflect the combined operations of legacy Huntington, Veritex, and Cadence.
Key Financial Metrics
| Metric | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 |
|---|---|---|---|---|
| Net Income (Attributable to Huntington) | $727 million | $536 million | $1,250 million | $1,063 million |
| Diluted EPS | $0.33 | $0.34 | $0.59 | $0.68 |
| Total Revenue (FTE) | $2,857 million | $1,954 million | $5,449 million | $3,889 million |
| Net Interest Income (FTE) | $2,072 million | $1,483 million | $3,982 million | $2,924 million |
| Noninterest Income | $785 million | $471 million | $1,467 million | $965 million |
| Noninterest Expense | $1,809 million | $1,197 million | $3,583 million | $2,349 million |
| Net Interest Margin (FTE) | 3.21% | 3.11% | 3.23% | 3.11% |
| Efficiency Ratio (Non-GAAP) | 61.5% | 59.0% | 64.2% | 58.9% |
| Total Assets | $284.0 billion | $207.9 billion (Avg) | $273.4 billion (Avg) | $206.5 billion (Avg) |
| Loans and Leases | $189.4 billion | $133.2 billion (Avg) | $181.8 billion (Avg) | $132.0 billion (Avg) |
| Allowance for Credit Losses (ACL) | $3.4 billion (1.78% of loans) | $2.5 billion (Dec 31, 2025) | $3.4 billion | $2.5 billion (Dec 31, 2025) |
| CET1 Risk-Based Capital Ratio | 10.0% | 10.4% (Dec 31, 2025) | 10.0% | 10.4% (Dec 31, 2025) |
Material Changes vs. Prior Period
- Revenue Growth: Net interest income increased 40% ($585 million) and noninterest income increased 67% ($314 million) compared to Q2 2025. This growth is primarily driven by the Cadence and Veritex acquisitions, which added $67.5 billion in average earning assets.
- Expense Increase: Noninterest expense rose 51% ($612 million) year-over-year. This includes $152 million in acquisition-related expenses for the quarter. Excluding these costs, expense growth was 38%.
- EPS Dilution: Despite a 36% increase in net income, diluted EPS decreased from $0.34 to $0.33 due to a 38% increase in average diluted shares outstanding resulting from stock issued for the acquisitions.
- Asset Expansion: Total assets increased 26% ($58.9 billion) from year-end 2025, driven by $51.3 billion in assets acquired from Cadence and organic loan growth.
- Credit Quality: Nonperforming assets (NPAs) increased 71% to $1.6 billion, largely due to $295 million in NPAs assumed from Cadence. Net charge-offs (NCOs) rose to $119 million (0.25% of average loans) from $66 million in the prior year quarter.
Guidance, Outlook, and Risks
Management Commentary: Management highlights strong execution and successful integration of Cadence and Veritex. The company maintains a "moderate-to-low" risk appetite. The balance sheet is described as a source of strength, supported by robust liquidity and capital profiles.
Economic Outlook: The company notes a resilient economy despite geopolitical uncertainty (U.S.-Iran conflict) and elevated inflation. The Federal Reserve is expected to maintain elevated interest rates, with potential cuts later in 2026 and 2027. The baseline economic scenario assumes unemployment peaking at 4.6% in late 2026.
Risks and Contingencies:
- Acquisition Integration: Risks related to realizing anticipated synergies and successfully integrating systems and cultures from Cadence and Veritex.
- Interest Rate Risk: The balance sheet is asset-sensitive. A 200 basis point decrease in rates would result in a 1.8% decrease in Net Interest Income (NII) over 12 months.
- Credit Risk: Specific concerns regarding commercial real estate (CRE) and leveraged lending within the Commercial & Industrial (C&I) portfolio due to the interest rate environment.
- Legal Proceedings: A significant pending litigation involves a former Cadence Bank loan under the Main Street Lending Program, with the receiver seeking approximately $350 million in damages. Management estimates a reasonably possible loss range of $0 to $75 million in excess of accrued liabilities.
Investor Verification Checklist
- Acquisition Synergies: Verify the timeline and progress of cost savings and revenue synergies from the Cadence and Veritex integrations against management targets.
- Acquisition-Related Expenses: Monitor the run-rate of acquisition-related expenses ($152 million in Q2) to assess when the company will return to pre-acquisition efficiency ratios.
- Credit Quality Trends: Track the trajectory of Net Charge-offs (NCOs) and Nonaccrual Loans (NALs) specifically in the acquired portfolios to ensure they stabilize as expected.
- Capital Ratios: Confirm that CET1 and Tier 1 leverage ratios remain well above regulatory "well-capitalized" standards despite share repurchases and higher risk-weighted assets.
- Legal Exposure: Review updates on the Donelon v. Americas Insurance Co. litigation regarding the $350 million claim to assess potential impact on future provisions.