Huntington dials up its forecast after strong third quarter

• Forward look: Huntington boosted its 2025 financial performance estimates, moving forecasts for loan and deposit growth, along with spread and fee income, to the higher end of its previously stated target ranges. 
• Expert quote: "To be in Dallas, where there're 150,000 new residents every year, plus the business that flows off that, we feel very fortunate," Chairman and CEO Steve Steinour said, referring to the company's pending acquisition of Dallas-based Veritex Holdings.
• Key insight: Huntington reported year-over-year declines in net charge-offs, as well as in nonperforming and criticized assets.

Huntington Bancshares , aided by double-digit boosts in both spread income and fee income, reported a 25% year-over-year increase in net income during the third quarter.

Credit quality improved, while growth in operating expenses remained muted, despite the Columbus, Ohio-based company's active growth programs in the Carolinas and Texas.

"The business is performing well on all fronts," Chairman and CEO Steve Steinour said on a conference call with analysts. "We have tremendous momentum, and we're poised to accelerate from here."

Steinour is counting on Texas as the source for much of Huntington's growth going forward. The $210 billion-asset company expects to close its $1.9 billion acquisition of Dallas-based Veritex Holdings on Oct. 20, just over three months after announcing the deal.

Huntington entered the Dallas market as a commercial lender in March 2024. Combining with Veritex will make it the fifth-largest Dallas bank by deposits, according to Steinour.

"To be in Dallas, where there're 150,000 new residents every year, plus the business that flows off that, we feel very fortunate," Steinour told American Banker in an interview. "We're highly confident in what we're going to be able to achieve."

Huntington, which reported net income of $602 million, enjoyed increases in both loans and deposits. Loans totaled $138 billion on Sept. 30, up 9% year over year. Deposits of $165 billion rose 4%. Those gains drove an 11% annual increase in net interest income and a 20% year-over-year boost in noninterest income. Total revenue, which approached $2.2 billion for the three months ending Sept. 30, increased 14% from the same period in 2024.

Chief Financial Officer Zach Wasserman said on the conference call that Huntington would push its full-year 2025 growth estimates — not counting the impact of the Veritex acquisition — to the high end of the previously stated target range — that's loan growth of 8% and deposit growth of 5.5%. Wasserman said he expected net interest income to finish the year 10% to 11% higher than it was at the end of 2024. Fee income was expected to grow by 7%.

So far, Huntington's balance sheet expansion has come without new credit-quality concerns. Third-quarter net charge-offs totaled 0.22% of loans and leases, down from 0.30% a year ago. The criticized asset and nonperforming asset ratios also declined on a year-over-year basis.

"We've had this aggregate low-to-moderate risk appetite for 15 years, so that is paying dividends," Steinour said. "The discipline around the policies, the structural things we do around choosing customers who we want to bank and how we manage risk — that's the gist of it."

Chief Credit Officer Brendan Lawler said on the conference call that Huntington's strong credit discipline has helped it steer clear of fraud problems like the ones that have surfaced at several other regional and money-center institutions in recent weeks.

"We work with our clients well in advance of anything like the events that have happened over the last month, so I feel really confident in our ability to actively manage our book," Lawler said.

Steinour added that credit quality within Huntington's small-business loan portfolio continues to hold steady, despite macroeconomic concerns surrounding tariffs, inflation and interest rates. "We're not seeing any significant change in terms of risk profile," he said.

Huntington's earnings report seemed to satisfy analysts and investors. Shares closed up 1% at $15.50.

David Chiaverini, who covers the company for Jeffries, characterized its third-quarter earnings as "solid." Chiaverini reiterated his "buy" rating and increased full-year profit estimates for 2025 and 2026 by four and five cents respectively, to $1.52 and $1.70.