Executive Summary
Huntington reported net income of $2.2 billion, or $1.39 per diluted share, up 14% year-over-year, driven by 12% growth in net interest income and a 13 basis point expansion in net interest margin to 3.13%. The company completed the $1.7 billion Veritex acquisition in October 2025 and the $8.1 billion Cadence acquisition in February 2026, positioning itself as a significantly larger regional bank.
What happened
Huntington delivered strong financial performance in 2025, with net income increasing 14% to $2.2 billion and diluted earnings per share rising to $1.39 from $1.22 in 2024. The company completed the Veritex acquisition on October 20, 2025, adding $12 billion in total assets, $9.3 billion in loans, and $10.5 billion in deposits. Total revenue on a fully taxable equivalent basis increased 11% to $8.2 billion, driven by a 12% increase in net interest income to $6.0 billion and a 7% increase in noninterest income to $2.2 billion. Net interest margin expanded 13 basis points to 3.13%, primarily due to a decrease in the cost of funding as deposit pricing improved in the lower rate environment, partially offset by lower yields on earning assets. Noninterest expense increased 10% to $5.0 billion, including $168 million of acquisition-related expenses. The provision for credit losses increased 10% to $463 million, driven primarily by loan growth and the addition of acquired loan reserves. The company maintained strong capital levels with a CET1 ratio of 10.4% and tangible common equity to tangible assets of 7.1%, up from 6.1% in the prior year. In February 2026, shortly after year-end, Huntington completed the Cadence Bank acquisition, adding $54 billion in assets, $37 billion in loans, and $44 billion in deposits, significantly expanding its regional footprint.
Why it matters for investors
The combination of margin expansion, balance sheet growth, and improved profitability demonstrates Huntington's ability to navigate the transition from a rising to falling rate environment while executing on strategic acquisitions. The 13 basis point improvement in net interest margin to 3.13% reflects improving deposit pricing dynamics, with the cumulative total deposit beta of 35% through the fourth quarter of 2025 indicating strong deposit franchise value. This margin expansion, combined with 8% growth in average earning assets to $193.7 billion, drove the 12% increase in net interest income. The completion of two major acquisitions—Veritex in October 2025 and Cadence in February 2026—positions Huntington as a significantly larger and more geographically diverse regional bank. The Cadence transaction alone represents a transformational expansion, adding $54 billion in assets and establishing a major presence in Texas, Mississippi, and other Southern markets. Credit quality metrics remained healthy, with net charge-offs declining to 0.23% of average loans from 0.30%, indicating disciplined underwriting and stable portfolio performance despite economic uncertainty. The allowance for credit losses of 1.83% of total loans provides substantial coverage, with $2.7 billion in total reserves. The 70% insured deposit ratio and strong liquidity position with $110.9 billion in selected contingent liquidity sources provide stability in a volatile banking environment. However, the 10% increase in noninterest expense, driven partly by acquisition-related costs and higher personnel and technology expenses, resulted in an efficiency ratio of 59.9%. The company faces integration challenges from the Veritex and Cadence acquisitions and ongoing operating expense pressure.
Bullish points
Net interest margin expanded 13 basis points to 3.13% in 2025 compared to 3.00% in 2024, driven by improved deposit pricing dynamics with a cumulative total deposit beta of only 35% during the falling rate cycle, demonstrating strong deposit franchise value and pricing power.
Total loans and leases grew 15% to $149.6 billion, including $10.3 billion of organic growth and $9.3 billion from the Veritex acquisition, while total deposits increased 9% to $176.6 billion with 70% insured, providing a stable and diversified funding base.
Credit quality improved with net charge-offs declining to 0.23% of average loans from 0.30% in 2024, while nonperforming assets as a percentage of total loans remained stable at 0.63%, indicating disciplined underwriting and effective credit risk management.
The Cadence acquisition completed in February 2026 adds $54 billion in assets, $37 billion in loans, and $44 billion in deposits, significantly expanding geographic presence and creating revenue synergies in high-growth Southern markets including Texas, Mississippi, and Louisiana.
Strong capital position with CET1 ratio of 10.4%, tangible common equity to tangible assets ratio of 7.1%, and robust liquidity with $110.9 billion in selected contingent liquidity sources provides substantial capacity to support growth and withstand potential stress.
Bearish points
Noninterest expense increased 10% to $5.0 billion, including $168 million of acquisition-related expenses, driving the efficiency ratio to 59.9% and raising concerns about the ability to achieve operating leverage as integration costs from Veritex and Cadence continue.
Nonperforming assets increased 15% to $945 million, driven by a $105 million increase in commercial and industrial nonaccrual loans and a $24 million increase in residential mortgage nonaccrual loans, partly reflecting loans acquired in the Veritex transaction and potential credit migration.
Both business segments experienced declining net income, with Consumer & Regional Banking down 3% to $1.5 billion and Commercial Banking down 2% to $1.1 billion, indicating core earnings pressure despite strong revenue growth.
The provision for credit losses increased 10% to $463 million, driven by loan growth and current period charge-off activity, while the economic scenario models incorporate uncertainty around tariffs, inflation, and geopolitical instability that could pressure credit quality.
The CET1 ratio declined modestly to 10.4% from 10.5%, driven by increased risk-weighted assets and the CECL transition adjustment, limiting near-term capital flexibility despite the company maintaining well-capitalized status and a 2.5% stress capital buffer requirement.
Key highlights
Huntington generated $2.2 billion in net income and $1.39 in diluted earnings per share, representing a 14% increase from the prior year. The company expanded its net interest margin by 13 basis points to 3.13%, reflecting strong deposit pricing discipline with a cumulative total deposit beta of only 35% during the falling rate environment. Total revenue on a fully taxable equivalent basis increased 11% to $8.2 billion, driven by net interest income growth of 12% and noninterest income growth of 7%. The company completed the $1.7 billion Veritex acquisition in October 2025, adding $9.3 billion in loans and $10.5 billion in deposits, and followed with the transformational $8.1 billion Cadence acquisition in February 2026, which added $54 billion in assets. Credit quality remained stable with net charge-offs declining to 0.23% of average loans while the allowance for credit losses stood at 1.83% of total loans. The company maintained a strong capital position with a CET1 ratio of 10.4% and tangible common equity to tangible assets of 7.1%, up from 6.1% in the prior year. Insured deposits comprised 70% of the total deposit base of $176.6 billion, providing funding stability.
Management commentary
Management highlighted the company's successful execution of its strategic plan and strong financial performance in 2025. The baseline economic scenario used in the December 31, 2025 ACL determination assumes the unemployment rate peaking at 4.8% in the fourth quarter of 2026 with the Federal Reserve continuing gradual rate cuts to reach 2.75% in 2027 and a neutral level of 3.0% by 2028. Management stated: 'Our 2025 results reflect strong growth across loans, deposits, and value-added fee services, supported by the combination of existing and new businesses, and our partnership with Veritex.' Management emphasized the company's focus on delivering top quartile performance through sustainable long-term profitable growth and maintaining an aggregate moderate-to-low risk appetite. On the Cadence acquisition, management noted: 'The success of the Cadence Merger will depend, in part, on the ability to realize the anticipated cost savings from combining the businesses.' Management acknowledged ongoing risks including economic uncertainty, inflationary pressures, the impacts of U.S. trade policies including tariffs, and political uncertainty. The company continues to focus on building existing business relationships, adding new relationships, and expanding capabilities through both geographic expansion and the addition of new commercial verticals.
What to watch next
Investors should monitor:
Integration execution and cost synergy realization from the Veritex and Cadence acquisitions, including the ability to achieve anticipated cost savings while retaining key customers and employees, as management stated the integration process could result in loss of key employees or disruption of ongoing businesses.
Net interest margin trajectory in 2026 as the Federal Reserve continues to lower interest rates, with management forecasting gradual cuts throughout 2026 and 2027 until reaching 2.75% in 2027, which could pressure asset yields and test the sustainability of deposit pricing discipline.
Credit quality trends, particularly in the commercial real estate office portfolio ($1.8 billion, or 1% of total loans) which has ACL reserves of approximately 9%, and broader commercial loan performance as management monitors the impacts of elevated interest rates, inflation, and potential recession risks.
Operating leverage and expense discipline following the completion of acquisition integration, as noninterest expense increased 10% in 2025 including $168 million of acquisition-related expenses, with the efficiency ratio at 59.9% and ongoing pressure from personnel costs and technology investments.
This summary is based solely on excerpts from the company's Form 10-K filing.