Huntington Bancshares (HBAN) Q4 2023 earnings summary

Executive summary

• FY23 revenue was $7.4B, up 1.6% YoY; net interest income rose 3.3%, and adjusted ROTCE was 19.4%.

• Q4 net income was $243M, or $0.15 per diluted share; adjusted EPS was $0.27, excluding $0.12 per share of after-tax notable items.

• A $74M pretax pay-fixed swaption mark-to-market loss reduced Q4 EPS by $0.04.

• 2024 priorities include high-quality loan growth, fee expansion, active interest-rate risk management and disciplined underwriting.

Financial highlights

• Q4 FTE net interest income was $1.327B; GAAP net interest income was $1.316B, down 4% QoQ and 10% YoY.

• Q4 noninterest income was $405M; excluding swaption marks and CRT impact, it was $481M.

• Reported noninterest expense was $1.348B, including $226M of notable items; adjusted expense was $1.122B.

• Average loans were $121.2B, up 0.4% QoQ and 2.0% YoY; average deposits were $149.7B, up 2.7% YoY.

• FY23 net income available to common was $1.817B; GAAP ROTCE was 17.6%, versus adjusted ROTCE of 19.4%.

Outlook and guidance

• FY24 average loans are guided up 3%–5% from the $120.9B FY23 baseline; average deposits up 2%–4% from $147.4B.

• FY24 NII is guided down 2% to up 2% from $5.481B, with a Q1 trough and sequential dollar growth thereafter.

• FY24 noninterest income, excluding notable items, swaption marks and CRT, is guided up 5%–7%; adjusted noninterest expense is guided up ~4.5%.

• FY24 net charge-offs are guided at 25–35 bps; the effective tax rate is expected to be ~19%, assuming the consensus economic outlook.

• Fixed-rate loan repricing of $13B–$15B is expected in FY24 with ~350 bps of yield pickup, alongside deposit repricing and lower negative hedge carry.