Huntington Bancshares Incorporated (NASDAQ:HBAN) traded higher in the market but later closed in the red after reporting mixed Q2 earnings. The earnings came with good news for shareholders, the diversified regional bank having declared a cash dividend on its series A B and D preferred stock.
Mixed Q2 Earnings
The Columbus-based bank posted earnings of 19 cents per diluted shares below analysts’ estimates of 21 cents a share. Revenues, on the other hand, came in at $787 million topping analysts’ expectations of $777.1 million. Net income in the quarter was down by 10.7% compared to last year same quarter, coming in at $175 million.
Non-interest income was down by 4% year over year to $271 million Huntington Bancshares attributing the drop to lower mortgage banking income. Trust services fees, as well as insurance income and reduced income on loans sold also had an impact on the non-interest income. Higher service charges on deposit and payment processing income helped avert a much bigger decline.
Increased personnel costs and other professional services took a toll on non-interest expense, which was up by 6% to $524 million. Huntington Bancshares loans and leases in the quarter were up by 8% to $51.9 billion.
Business Outlook
The quarter according to Chief Executive officer, Steve Steinour demonstrated encouraging business growth even on earnings missing estimates. Strong performance in auto loans and residential mortgage according to the executive is a testament that Huntington Bancshares Is on the right track. Focus now shifts towards balancing growth across all segments through disciplined risk management.
During the earnings call, the executive also confirmed that the acquisition of FirstMerit is on track shareholders in the two companies having shown willingness to approve the transaction. Divestiture of some of the bank’s branches in Ohio is also going well, which should mark yet another milestone once complete.
During the quarter, Huntington Bancshares Incorporated (NASDAQ:HBAN) did not buy any stock as part of its $166 million repurchase plan awaiting the outcome of the FirstMerit acquisition.
