Company: HBAN
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0000049196-25-000020
Chunk: 210

Company: HUNTINGTON BANCSHARES INC /MD/
Filing Date: 2025-02-14
Form: 10-K
Item: Item 7
Chunk 210
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 start within the measurement horizon.

A key driver of our interest rate risk profile is our interest-bearing deposit repricing sensitivity assumptions to changes in interest rates, otherwise known as deposit beta. In addition, our interest expense is impacted by the composition of both interest-bearing and noninterest-bearing deposits in relation to our total deposits. Accordingly, we consider the impacts from both interest-bearing and noninterest bearing deposits on our total deposit beta. Our cumulative total deposit beta (total cost of deposits) through the most recent rising rate cycle, which started in the first quarter of 2022 and concluded in the third quarter of 2024, was 46%. Following the start of the falling rate cycle, which began late in the third quarter of 2024, our cumulative total deposit beta (total cost of deposits) was 24%. 

Interest rate risk is measured across a range of scenarios and the results are reported to the ROC at least quarterly. A comprehensive discussion of risk management governance can be found in Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations and the “Risk Management” section of this Form 10-K.

We use two approaches to model interest rate risk: Net interest income at risk (NII at Risk) and economic value of equity at risk modeling sensitivity analysis (EVE at Risk).

NII at Risk is used by management to measure the risk and impact to earnings over the next 12 months, using a variety of interest rate scenarios. The NII at Risk results included in the table below reflect the analysis used monthly by management. It models gradual “ramp” -200, -100, +100 and +200 basis point parallel shift scenarios, implied by the forward yield curve over the next 12 months. 

Table 16 - Net Interest Income at RiskDecember 31, 2024December 31, 2023Federal Funds Rate (1)Federal Funds Rate (1)Basis point change scenarioStarting Point (2)Month 12 (3)NII at Risk (%)Starting Point (2)Month 12 (3)NII at Risk (%)+2004.50 6.00 2.0 5.50 5.75 5.5 +1004.50 5.00 0.8 5.50 4.75 3.0 Base4.50 4.00 — 5.50 3.75 — -1004.50 3.00 -0.5