01—Abstract
Summary
Summary of the 10-Q filed October 29, 2024. Cited figures are marked; the original filing is the authoritative source.
Huntington Bancshares Incorporated, a multi-state diversified regional bank holding company headquartered in Columbus, Ohio, reported net income attributable to Huntington of $517 milliona, or $0.33 per diluted common share, for the third quarter of 2024, compared with $547 million, or $0.35 per diluted share, a year earlier.
For the nine months ended September 30, 2024, net income attributable to Huntington was $1.41 billionb, down from $1.71 billion. Net interest income declined 1% in the quarter to $1.35 billion, as FTE net interest margin fell 22 basis points to 2.98%, reflecting higher cost of funds. Noninterest income rose 3% to $523 million, led by capital markets and advisory fees and wealth and asset management revenue, while noninterest expense increased 4% to $1.13 billion.
Credit metrics were mixed. The provision for credit losses rose 7% to $106 millionc in the quarter, and net charge-offs were 0.30% of average loans and leases, up from 0.24% a year earlier. Nonperforming assets increased to $784 million from $711 million at year-end 2023.
The ACL was $2.4 billiond, or 1.93% of total loans and leases, versus 1.97% at December 31, 2023. Total assets reached $200.5 billion, and the CET1 risk-based capital ratio improved to 10.4% from 10.2%. The company did not repurchase any shares during the first nine months of 2024 and does not expect to use its share repurchase program through 2024, citing the use of organic capital for loan growth.
The filing also notes that Huntington declared a quarterly common dividend of $0.155 per share and that the Federal Reserve's indicative stress capital buffer requirement for the period October 1, 2024 through September 30, 2025 is 2.5%, down from 3.2%. Management states that the company has sufficient liquidity and capital to meet obligations over the next 12 months and beyond.
02—Key points
Key Highlights
- Q3 2024 net income attributable to Huntington was $517 million ($0.33 diluted EPS), down from $547 million ($0.35) in Q3 2023; nine-month net income was $1.41 billion versus $1.71 billion.
- Q3 2024 net interest income fell 1% to $1.35 billion as FTE net interest margin declined 22 basis points to 2.98%, driven by higher cost of funds.
- Noninterest income rose 3% to $523 million, with capital markets and advisory fees up 50% and wealth and asset management revenue up 18%.
- Net charge-offs were 0.30% of average loans and leases in Q3 2024, up from 0.24%, and nonperforming assets rose to $784 million from $711 million at year-end 2023.
- Total assets grew to $200.5 billion and total deposits to $158.4 billion at September 30, 2024, with loans and leases at $126.4 billion.
- CET1 risk-based capital ratio increased to 10.4% from 10.2%, and the indicative stress capital buffer requirement for October 2024 to September 2025 is 2.5%, down from 3.2%.
- No common shares were repurchased in the first nine months of 2024, and the company does not expect to use its share repurchase program through 2024.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed October 29, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $362.00M$338.00M | +7.1% |
| Net Income | $517.00M$547.00M | −5.5% |
| EPS (Basic) | $0.33$0.35 | −5.7% |
| EPS (Diluted) | $0.33$0.35 | −5.7% |
| Shares Outstanding (Basic) | 1.45B1.45B | +0.3% |
| Shares Outstanding (Diluted) | 1.48B1.47B | +0.6% |
05—Questions
Frequently Asked Questions
How did Huntington's profitability trend in the third quarter of 2024?
Net income attributable to Huntington was $517 million, or $0.33 per diluted share, compared with $547 million, or $0.35, in the third quarter of 2023. Net interest income declined 1% and noninterest expense rose 4%, while noninterest income increased 3%.
What drove the decline in net interest margin?
The filing attributes the 22 basis point decline in FTE net interest margin to 2.98% primarily to higher cost of funds in the higher interest rate environment and a $12.3 billion, or 11%, increase in average interest-bearing deposits, partially offset by higher loan and lease and investment security yields.
Is credit quality deteriorating?
Credit metrics moved modestly weaker. Net charge-offs were 0.30% of average loans and leases in the third quarter of 2024 versus 0.24% a year earlier, and nonperforming assets increased to $784 million from $711 million at December 31, 2023. The ACL coverage ratio declined to 1.93% from 1.97%, which the filing attributes to the macroeconomic environment and changes in risk profiles.
What is the company's capital position and shareholder return outlook?
The CET1 risk-based capital ratio was 10.4% at September 30, 2024. The quarterly common dividend was $0.155 per share, and the company did not repurchase shares in the first nine months of 2024 and does not expect to use its repurchase program through 2024, citing organic capital needs for loan growth and proposed regulatory capital changes.
What is the outlook for interest rate sensitivity?
The balance sheet is described as asset sensitive at both September 30, 2024 and December 31, 2023. The NII at Risk table shows a 1.4% increase in net interest income in a +100 basis point scenario and a 1.6% decrease in a -100 basis point scenario, measured over 12 months at September 30, 2024.
06—Continue