Huntington Bancshares: Q4 2024 Earnings Call Highlights Record Fees and Loan Growth

As an investor, keeping track of a company's earnings calls can provide valuable insights into its financial health and future prospects. Huntington Bancshares Inc (HBAN,Financial) recently released its Q4 2024 earnings call, showcasing robust financial performance that exceeded analyst expectations. In this article, we'll delve into the key highlights of the earnings call and explore how Huntington's strategic investments and core business strength have positioned it for continued growth and profitability.



Record Fees and Loan Growth

Huntington reported record fee income and significant loan growth during the fourth quarter of 2024. Noninterest income, which includes fee income, increased by $36 million (7%) from the prior quarter and $154 million (38%) from the year-ago quarter. Excluding the impact of mark-to-market on pay-fixed swaptions, credit risk transfer transactions, and the loss on sales of securities, noninterest income increased by $49 million (9%) from the prior quarter and $96 million (20%) from the year-ago quarter.

The core fee income growth of 20% year-over-year (YoY), excluding one-time items, reflects strong underlying business momentum. This growth was driven by increased fee revenues from payments, wealth management, and capital markets, as mentioned by Steve Steinour, chairman, president, and CEO, in his commentary.

Sustained Deposit Growth and Improved Capital Adequacy

Huntington's average total deposits increased by $2.9 billion (2%) from the prior quarter and $9.8 billion (7%) from the year-ago quarter. This sustained deposit growth demonstrates the bank's strong franchise value and customer acquisition capabilities.

The bank's capital adequacy remained strong, with the Common Equity Tier 1 (CET1) risk-based capital ratio improving to 10.5% at the end of 2024, up from 10.4% in the prior quarter. The adjusted Common Equity Tier 1 ratio, including the effect of AOCI, was 8.7%, down from 8.9% in the prior quarter. While this is a slight decrease, it remains within a healthy range.

Credit Quality and Outlook

Huntington maintained strong credit quality metrics throughout 2024. Net charge-offs for the fourth quarter were 0.30% of average total loans and leases, reflecting stability in the bank's credit portfolio. The nonperforming asset ratio at quarter-end was 0.63%, indicating a low level of troubled assets. The allowance for credit losses (ACL) was $2.4 billion, or 1.88% of total loans and leases, at quarter-end, ensuring that the bank is well-prepared for potential credit losses in the future.

Looking ahead, Huntington's strategic investments and core business strength are expected to support continued growth and profitability. The bank's expansion into new geographies and commercial verticals has yielded tangible results, as evidenced by the 4% sequential growth in commercial loans. Additionally, the bank's ability to manage funding costs lower and increase fee revenues from payments, wealth management, and capital markets has contributed to its strong performance.



In conclusion, Huntington Bancshares Inc's Q4 2024 earnings call highlights the bank's record fees and loan growth, sustained deposit growth, and improved capital adequacy. The bank's strategic investments and core business strength have positioned it for continued growth and profitability in the coming years. As an investor, keeping an eye on Huntington's earnings calls and financial performance can provide valuable insights into the regional banking sector and the broader economy.