01—Abstract
Summary
Summary of the 8-K filed January 17, 2025. Cited figures are marked; the original filing is the authoritative source.
Huntington Bancshares Incorporated reported net income of $530 milliona, or $0.34 per common share, for the quarter ended December 31, 2024, up $13 million from the prior quarter and up $287 million, or $0.19, from the year-ago quarter.
Return on average assets was 1.05%, return on average common equity was 11.0%, and return on average tangible common equity was 16.4%. The filing describes record fee income and loan growth, with noninterest income of $559 millionb, up 38% from the year-ago quarter, and average total loans and leases of $128.2 billion, up 6% year over year. Total deposit costs fell to 2.16%, down 24 basis points from the prior quarter, and net interest income rose to $1.395 billion.
Credit metrics were stable but mixed. Net charge-offs were 0.30% of average loans and leases, nonperforming assets rose to $822 millionc (0.63% ratio) from $711 million a year earlier, and the allowance for credit losses was $2.4 billion, or 1.88% of total loans and leases. Capital ratios were mixed: the CET1 ratio rose to an estimated 10.5% from 10.4%, while the tangible common equity ratio fell to 6.1% from 6.4%.
Pre-tax income was reduced by $21 milliond from the sale of about $1 billion of corporate debt securities, and the company completed a credit linked note transaction on about $4 billion of prime indirect auto loans that reduced risk-weighted assets by about $3 billion. Management stated it expects its core businesses and strategic investments to support momentum through 2025 and beyond. The filing describes these expectations only qualitatively and provides no specific 2025 guidance.
02—Key points
Key Highlights
- Q4 2024 net income attributable to Huntington was $530 million, or $0.34 per diluted share, versus $0.15 in the year-ago quarter.
- Noninterest income rose to $559 million, up 38% year over year, with capital markets and advisory fees of $120 million and a record capital markets revenue quarter.
- Average total loans and leases reached $128.2 billion, up 6% year over year, led by commercial and industrial growth.
- Total deposit costs declined to 2.16% from 2.40% in the prior quarter's 2.40%, with net interest margin at 3.03%.
- Nonperforming assets were $822 million (0.63% ratio) and net charge-offs were 0.30% of average loans, both reflecting stable credit.
- CET1 ratio was an estimated 10.5%, up from 10.4%, while the tangible common equity ratio declined to 6.1% from 6.4%.
- Tangible book value per share was $8.33, down $0.32 from the prior quarter but up $0.54 from a year ago.
03—Questions
Frequently Asked Questions
How did Huntington's Q4 2024 earnings compare with the prior year?
Net income attributable to Huntington was $530 million, or $0.34 per diluted share, compared with $243 million, or $0.15 per share, in the fourth quarter of 2023. The filing states that the year-over-year increase reflects higher net interest income and noninterest income, partly offset by lower noninterest expense driven by the prior year's FDIC special assessment.
What drove the growth in noninterest income?
Noninterest income was $559 million, up $154 million, or 38%, from the year-ago quarter. Capital markets and advisory fees increased $51 million, or 74%, mainly from higher advisory and underwriting fees, and payments and cash management revenue rose $12 million, or 8%. The prior year quarter included a $74 million mark-to-market loss on pay-fixed swaptions.
What did the company disclose about its credit quality?
Net charge-offs were $97 million, or 0.30% of average loans and leases. Nonperforming assets rose to $822 million from $711 million a year earlier, driven by commercial and industrial and home equity nonaccrual loans. The allowance for credit losses was $2.4 billion, or 1.88% of total loans and leases.
How did capital ratios change during the quarter?
The estimated CET1 risk-based capital ratio rose to 10.5% from 10.4% in the prior quarter, driven by earnings net of dividends. The tangible common equity ratio fell to 6.1% from 6.4%, reflecting changes in accumulated other comprehensive income and tangible asset growth. The company also completed a credit linked note transaction on about $4 billion of prime indirect auto loans that reduced risk-weighted assets by about $3 billion.
What did management say about the outlook?
Management said it expects momentum from its core businesses and strategic investments to carry results through 2025 and beyond, with a robust growth outlook and expanded profitability. The filing does not provide quantitative 2025 guidance.
04—Continue