Company: HBAN
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0000049196-25-000063
Chunk: 87

Company: HUNTINGTON BANCSHARES INC /MD/
Filing Date: 2025-07-29
Form: 10-Q
Item: Part I, Item 2
Chunk 87
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 10 Residential mortgage93 83 Automobile5 6 Home equity105 107 RV and marine2 2 Total nonaccrual loans and leases842 783 Other real estate, net10 8 Other NPAs (1)— 31 Total nonperforming assets$852 $822 Nonaccrual loans and leases as a % of total loans and leases0.62 %0.60 %NPA ratio (2)0.63 0.63 

(1)    Other nonperforming assets include certain impaired investment securities and/or nonaccrual loans held-for-sale.

(2)    Nonperforming assets divided by the sum of loans and leases, other real estate owned, and other NPAs.

ACL

Our ACL is comprised of two different components, the ALLL and the AULC, both of which in our judgment are appropriate to absorb lifetime expected credit losses in our loan and lease portfolio. We utilize an independent third-party baseline forecast that projects future economic conditions and considers multiple macroeconomic scenarios. These macroeconomic scenarios contain certain variables that are influential to our modeling process, the most significant being unemployment rates and GDP.

The baseline economic scenario used in the June 30, 2025 ACL determination assumes the imposition of tariffs impacts global trade and weakens the U.S. economy, with weak near-term GDP growth and increasing unemployment. The unemployment rate is forecasted to increase to 4.4% by the fourth quarter of 2025, continuing to increase to 4.9% through the end of 2026. The Federal Reserve is projected to restart rate cuts beginning the second half of 2025 and into 2026, until reaching a federal funds rate of 3% by the third quarter of 2026. Inflation starts out at 3.8% with modest improvement expected through the remainder of 2025 and into 2026, before ending 2026 at 1.8%. GDP starts out at 0.4%, with improvement through the end of 2026, ending at 1.9%.

18     Huntington Bancshares Incorporated

Table of Contents

The table below is intended to show how the forecasted path of unemployment and GDP in the baseline scenario has changed since the end of 2024.

Table 12 - Forecasted Key Macroeconomic Variables202420252026Baseline scenario forecastQ4Q2Q4Q2Q4Unemployment rate (1