Company: HBAN
Filing Date: 2025-04-29
Form Type: 10-Q
Source: 0000049196-25-000038
Chunk: 121

Company: HUNTINGTON BANCSHARES INC /MD/
Filing Date: 2025-04-29
Form: 10-Q
Item: Part I, Item 2
Chunk 121
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 lending commitments3 (13)(10)AULC balance, end of period$69 $66 $135 ACL balance, end of period$1,658 $757 $2,415 At March 31, 2025, the ACL was $2.5 billion, an increase of $32 million from December 31, 2024. The increase in the total ACL was driven by loan and lease growth, partially offset by a modest reduction in overall coverage ratios. The ACL coverage ratio at March 31, 2025 is reflective of the current macro-economic forecast and changes in various risk profiles intended to capture uncertainty not addressed within the quantitative reserve. The commercial ACL was $1.7 billion at March 31, 2025, an increase of $50 million from December 31, 2024. The increase was driven by commercial loan growth.The consumer ACL was $800 million at March 31, 2025, a decrease of $17 million from December 31, 2024. The decrease was primarily due to improvement in the forecasted path of the HPI index which is impactful to consumer real estate secured loans.The baseline economic scenario used in the March 31, 2025 ACL determination assumes the labor market has softened with the unemployment rate forecasted to remain at 4.1% throughout 2025 before marginally increasing to 4.2% in 2026. The Federal Reserve is projected to continue the cycle of rate cuts that started in September 2024, with further cuts forecast throughout for the second half of 2025 and throughout 2026 until reaching a federal funds rate of 3% by the end of 2026. Inflation is forecast to be 2.8% for the first quarter of 2025 and is expected to remain at similar levels throughout 2025 before approaching 2.5% by the end of 2026. GDP is forecast to decline from the estimated first quarter 2025 level of 2.5%, ending the fourth quarter of 2025 at 1.6% before marginally improving to 1.9% by the end of 2026.

The economic scenarios used included elevated levels of economic uncertainty including the impact of specific challenges in the commercial real estate Industry, recent inflation levels, the impacts of U.S. trade policies, the U.S. labor market, the expected path of interest rate changes by the Federal Reserve, and the impact of significant conflicts on-going around the