Huntington Bancshares (NASDAQ: HBAN) reported Q1 EPS of $0.03, $0.14 worse than the analyst estimate of $0.17.

2020 First Quarter Highlights compared with 2019 First Quarter:

• Fully-taxable equivalent total revenue increased $9 million, or 1%.
• Fully-taxable equivalent net interest income decreased $33 million, or 4%.
• Net interest margin decreased 25 basis points to 3.14%.
• Noninterest income increased $42 million, or 13%, driven by a $37 million, or 176%, increase in mortgage banking income.
• Noninterest expense decreased $1 million, or less than 1%.
• Efficiency ratio of 55.4%, down from 55.8%.
• Average loans and leases increased $0.9 billion, or 1%, year-over-year, including a $0.7 billion, or 2%, increase in average consumer loans and a $0.2 billion, or less than 1%, increase in average commercial loans.
• Average core deposits increased $0.5 billion, or 1%, year-over-year.
• Net charge-offs equated to 0.62% of average loans and leases, up from 0.38%.
• Nonperforming asset ratio of 0.75%, up from 0.61%.
• Provision for credit losses increased $374 million year-over-year to $441 million.
• Allowance for loan and lease losses (ALLL) increased $740 million to $1.5 billion, or 1.93% of total loans and leases; allowance for credit losses (ACL) increased to $1.6 billion, or 2.05% of total loans and leases.
• Common Equity Tier 1 (CET1) risk-based capital ratio of 9.47%, down from 9.84% and consistent with our 9% to 10% operating guideline.
• Tangible common equity (TCE) ratio of 7.52%, down from 7.57%.
• Tangible book value per common share increased $0.61, or 8%, to $8.28.
• Repurchased $88 million of common stock (7.1 million shares at an average price of $12.38 per share).

CEO Commentary:

"At Huntington, our purpose is to look out for people. Our sympathy is with all those impacted by COVID-19 and their families, and our deep gratitude and sincere appreciation goes out to all the healthcare workers, and all 'essential' workers, who are the heroes on the front lines each and every day. During this unprecedented time, we are proud to play an important role in the collective efforts within our communities to help our colleagues, customers, and others manage through the economic challenges that have developed out of the COVID-19 public health crisis," said Steve Steinour, chairman, president, and CEO. "From the outset, our first priority has been the health and safety of our colleagues and customers. With more than 80 percent of our colleagues working from home and more than 700 colleagues redeployed to help in keys areas across the bank, I am pleased with our ability to effectively adapt our businesses to meet the current challenges and adjust to changing customer needs. I am especially proud of our colleagues who have done a wonderful job continuing to serve our customers through branch locations and operations centers. And for all colleagues, we acted quickly by adding new benefits such as paid emergency leave and emergency childcare time off, as well as increased wellness and safety provisions for our colleagues. We then rolled out relief programs for customers to help them during these challenging times, and lastly, we dedicated funding for vital community organizations."

"In addition, as the nation's No. 1 SBA lender, we have a unique opportunity to support and, in some cases, stabilize our small business customers. As of April 16 when the SBA announced the fund had been exhausted, we helped almost 26,000 small businesses with applications totaling more than $6 billion of loans through the SBA's Paycheck Protection Program. We similarly have focused on aiding our medium and large business customers. Over the past weeks, we have seen draws on commercial lines and inflows of commercial deposits, as illustrated in the quarter-end balances, as these businesses fortified their own balance sheets."

"The many relief measures we implemented in the early days of the pandemic have helped to reduce the economic burden on both consumers and businesses. We suspended late fees, established payment deferral programs, and suspended repossession and foreclosure activity, among others," Steinour said. "Through last Friday, we have helped more than 51,000 consumer, 3,000 business banking, and 700 commercial customers through our deferral programs. Our relief programs will cost us revenue in the near term, but these are long-term investments in our customer relationships as a continuation of our Fair Play Banking philosophy introduced a decade ago, which strengthened customer loyalty and increased new customer acquisition. These actions are consistent with our purpose, and we will continue to support our customers and communities during these hard times."

Steinour concluded, "One of the most challenging aspects of this crisis, aside from the incredible human toll, is the uncertainty of not knowing how long it will last or how severe it will be. Huntington has been preparing for an economic downturn for years and entered this environment from a position of strength. We have strong capital and robust liquidity, our overall asset quality remains strong, and our core earnings power is solid. We have a foundation of disciplined enterprise risk management. We are being thoughtful, measured, and deliberate in our actions to adapt to the challenging operating environment, as we continue to make necessary investments for the future. We remain optimistic about the opportunities ahead, for Huntington and for our customers."

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