# EDGAR Filing Document

**Accession Number:** 0000049196
**File Stem:** 0001308179-23-000103
**Filing Date:** 2023-3
**Character Count:** 225822
**Document Hash:** 3b5a7153aa0a90cf16951e535d7e90b9
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001308179-23-000103.hdr.sgml**: 20230309

**ACCESSION NUMBER**: 0001308179-23-000103

**CONFORMED SUBMISSION TYPE**: ARS

**PUBLIC DOCUMENT COUNT**: 1

**CONFORMED PERIOD OF REPORT**: 20221231

**FILED AS OF DATE**: 20230309

**DATE AS OF CHANGE**: 20230309

**EFFECTIVENESS DATE**: 20230309

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** HUNTINGTON BANCSHARES INC /MD/
- **CENTRAL INDEX KEY:** 0000049196
- **STANDARD INDUSTRIAL CLASSIFICATION:** NATIONAL COMMERCIAL BANKS [6021]
- **IRS NUMBER:** 310724920
- **STATE OF INCORPORATION:** MD
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** ARS
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-34073
- **FILM NUMBER:** 23718389

**BUSINESS ADDRESS:**
- **STREET 1:** HUNTINGTON CTR
- **STREET 2:** 41 S HIGH ST HC0917
- **CITY:** COLUMBUS
- **STATE:** OH
- **ZIP:** 43287
- **BUSINESS PHONE:** 6144802265

**MAIL ADDRESS:**
- **STREET 1:** HUNTINGTON CENTER
- **STREET 2:** 41 S HIGH ST HC0917
- **CITY:** COLUMBUS
- **STATE:** OH
- **ZIP:** 43287

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** HUNTINGTON BANCSHARES INC/MD
- **DATE OF NAME CHANGE:** 19920703

### Attached PDF Documents

**Attachment 1:** `lhban2023_ars.pdf`

![img-0.jpeg](img-0.jpeg)

# HUNTINGTON BANCSHARES INCORPORATED
2022 Annual Report

PHOTO: HUNTINGTON TOWER, DETROIT, MI
COMMERCIAL BANKING HEADQUARTERS

# Consolidated Financial Highlights

(In millions, except per share amount)

## Selected income statement data

|  | 2022 | 2021 | 2020 |
| --- | --- | --- | --- |
| Total revenue (1) | $7,285 | $6,016 | $4,836 |
| Total noninterest expense | 4,201 | 4,375 | 2,795 |
| Pre-provision net revenue (1)(2) | 3,084 | 1,641 | 2,041 |
| Provision for credit losses | 289 | 25 | 1,048 |
| Net income attributable to Huntington Bancshares Inc. | 2,238 | 1,295 | 817 |

## Per common share data

| Net income per common share - diluted | $1.45 | $0.90 | $0.69 |
| --- | --- | --- | --- |
| Tangible book value per common share | 6.82 | 8.06 | 8.51 |
| Cash dividends declared per common share | 0.620 | 0.605 | 0.60 |

## Selected ratios

| Return on average assets | 1.25% | 0.85% | 0.70% |
| --- | --- | --- | --- |
| Return on average tangible common equity (ROTCE) (3) | 20.70 | 11.30 | 8.90 |
| Common equity Tier 1 capital ratio | 9.36 | 9.33 | 10.00 |
| Tier 1 capital ratio | 10.90 | 10.99 | 12.47 |
| Total capital ratio | 13.09 | 13.14 | 14.46 |
| Net charge-offs as a % of average loans and leases | 0.11 | 0.22 | 0.57 |

## Selected balance sheet data (period-end)

| Total assets | $182,906 | $174,064 | $123,038 |
| --- | --- | --- | --- |
| Loans and leases | 119,523 | 111,267 | 81,608 |
| Deposits | 147,914 | 143,263 | 98,948 |
| Total equity | 17,769 | 19,318 | 12,993 |

## Market data

| Closing share price | $14.10 | $15.42 | $12.63 |
| --- | --- | --- | --- |
| Market Capitalization | 20,347 | 22,266 | 12,845 |

$^{(1)}$ On a fully-taxable equivalent (FTE) basis assuming a 21% tax rate.

$^{(2)}$ Non-GAAP. See page 8 for reconciliation.

$^{(3)}$ Net income applicable to common shares excluding expense for amortization of intangibles for the period divided by average tangible common shareholders' equity. Average tangible common shareholders' equity equals average total common shareholders' equity less average intangible assets and goodwill. Expense for amortization of intangibles and average intangible assets are net of deferred tax liability, and calculated assuming a 21% tax rate.

OUR PURPOSE, VISION, AND VALUES

# OUR PURPOSE

We make people's lives
better, help businesses
thrive, and strengthen
the communities we
serve.

# OUR VISION

To be the
Leading People-First,
Digitally Powered Bank

# OUR VALUES

Can-do Attitude
Service Heart
Forward Thinking

PHOTO: HUNTINGTON TOWER, DETROIT, MI
COMMERCIAL BANKING HEADQUARTERS

2022 ANNUAL REPORT

1

![img-1.jpeg](img-1.jpeg)

## A LETTER FROM OUR CHAIRMAN

### Dear Fellow Owners and Friends:

2022 was a pivotal and record year for Huntington, thanks to the dedication and hard work of our colleagues. It was a year where we not only made great strides to deliver an extraordinary experience for our customers, but we continued to create a rewarding and engaging environment for our colleagues. We believe that our ability to deliver a “people-first, digitally enabled” path towards financial success for our customers sets us apart from our competition. Our Executive Leadership Team and colleagues produced record revenue and earnings, delivered cost synergies from the TCF acquisition, and completed additional bolt-on acquisitions of Capstone and Torana, welcoming new colleagues to the organization. We executed on our organic growth strategic priorities and have unlocked several incremental revenue engines across the company while maintaining our disciplined approach to credit and risk management. This performance over the course of the year resulted in the achievement of our medium-term financial targets, as well as improvement in customer satisfaction and colleague engagement.

I am personally inspired by our colleagues, who are highly engaged and are dedicated to serving the needs of our customers and communities. Trust remains at the center of all our relationships and our team delivered on our Purpose of making people’s lives better, helping businesses thrive, and strengthening the communities we serve throughout the entire year. They continue to achieve outstanding results and I am proud to be on their team.

As a forward-thinking company, and with an uncertain economic outlook on the horizon, we are prepared to remain nimble and dynamically manage through a range of potential scenarios. While we are cautious in our outlook, we enter 2023 from a position of strength, with a robust profitability profile, strong capital levels, and a top-tier reserve profile. These factors form a strong foundation for Huntington, and we are confident in our ability to continue to deliver value for shareholders.

### 2022: Record Financial Performance

We closed the year with record 2022 results which included reported net income of $2.2 billion, a 73% increase from the prior year, and diluted EPS of $1.45, up 61% year over year. Reported results were negatively impacted by notable items, primarily due to the TCF and Capstone acquisitions, which included non-recurring expenses of $95 million.

Pre-provision net revenue (PPNR) for the full year totaled $3.1 billion.$^{1}$ Excluding the notable items above, adjusted PPNR was $3.2 billion,$^{1}$ or an increase of 36% from prior year. We were very pleased to deliver consecutive quarters of record PPNR over the course of the year. We continue to manage the company with an intense focus on revenue growth and disciplined expense management while adhering to our aggregate moderate-to-low risk appetite through-the-cycle.

![img-2.jpeg](img-2.jpeg)

Return on Tangible Common Equity (ROTCE) was 20.7% for the full year. Adjusted ROTCE, excluding the notable items above, was 21.5%$^{1}$. These results reflect a top-tier return profile compared to peers. We believe these financial metrics - PPNR and ROTCE - are directly aligned with shareholder value creation and are reflected in our updated medium-term targets we shared in November.

Return on Tangible Common Equity % (ROTCE)

20.7% (Reported)

21.5% (Adjusted)

2 HUNTINGTON BANCSHARES INCORPORATED

Total revenue increased to $7.3 billion, also a record result for Huntington, driven by the full-year impact of TCF acquisition, continued execution of our underlying organic growth strategies, and from our asset sensitive balance sheet position which benefited from higher interest rates over the year.

![img-3.jpeg](img-3.jpeg)

We continued to grow our loan portfolio, with average loans and leases increasing by 8.6% from the year-ago quarter, supported by robust and broad-based commercial loan production. The consumer activity also contributed to growth over the year, particularly in residential mortgage. During the year, we benefited from the scale achieved through the TCF combination and complementary platforms, and some normalization in commercial loan utilization. That said, we continue to optimize loan growth aligned with our return on capital framework while we remain diligent in our lending as the macro-economic outlook continues to evolve.

Ending deposit balances increased by $4.7 billion, or 3.2% from prior year, as we acquired and deepened relationships across the bank. While 2022 was a difficult year for industry deposit growth, we outperformed our peers, ranking in the top quartile$^{2}$ of peers for deposit growth. We were pleased to see continued growth in our deposit base, as we believe it demonstrated the breadth of our franchise and our colleagues' ability to acquire and deepen primary bank relationships. We also believe it was supported by our longstanding Fair Play philosophy and industry-leading brand and reputation.

![img-4.jpeg](img-4.jpeg)

$^{1}$ Non-GAAP measure. See page 8 for reconciliation.

$^{2}$ Adjusted for peers impacted by mergers

Our capital ratios remained strong, with our Common Equity Tier 1 (CET1) ratio ending 2022 at 9.36%, within our targeted operating range of 9% to 10%. We continue to dynamically manage capital and we were pleased to announce a $1 billion share buyback program in January 2023, for utilization over the next two years.

## Our Strategy Delivering Results

As I reflect on my tenure as CEO for the past fourteen years, I can confidently say that Huntington has never been better positioned for future growth and performance. Our culture and Purpose are deeply ingrained in our steadfast efforts to look out for our customers and colleagues. Our Directors, the Executive Leadership Team, and our colleagues have built a powerful franchise over the years, establishing a distinguished brand and reputation. We have broad-based organic growth opportunities across the company generating diverse and sustainable revenue streams. And finally, we are focused, disciplined executors with a successful track record. We expect to deliver substantial value creation for years to come, and I could not be prouder or more energized.

![img-5.jpeg](img-5.jpeg)

In November 2022, we held our first Investor Day in twelve years. This was a momentous day for Huntington as we detailed the breadth of our businesses, our numerous strategic initiatives, revenue synergies, and the strength and expertise of our management team. Huntington has transformed significantly over the past decade, reflecting our disciplined approach to credit and risk management and supported by our aggregate moderate-to-low risk appetite through-the-cycle.

At Investor Day we were pleased to share our new medium-term financial targets. To achieve these targets and drive value creation across the franchise, we shared three strategic themes: Investing, Differentiating, and Optimizing.

First, we are investing in our revenue-producing initiatives to drive top-line revenue growth over the multi-year horizon. This growth is supported by both the additive TCF revenue synergies across most of our businesses and by the organic growth initiatives we

2022 ANNUAL REPORT 3

are investing in. Second, we are differentiating the customer experience, which is evidenced by the numerous awards and recognition our colleagues have received over the years. This differentiation is reflected in the customer experience when they bank with us, in the culture that emanates from everything we do, and in our colleagues who deliver this industry-leading experience. Finally, we are optimizing to drive efficiencies and dynamically managing our balance sheet to prepare for a more challenging economic scenario. The revenue-producing initiatives are supported by our disciplined approach to expense management and programs such as Operation Accelerate, which is designed to reduce customer and colleague pain points in our processes.

The actions we took in the previous two years have set a foundation for Huntington to execute over the long term, and especially during periods of uncertainty like we are currently facing. These actions and initiatives support our growth outlook and drive continued efficiencies as we look to the future. While we enjoyed a record year in 2022, benefiting from rising rates and a rebounding economy, we are proactive in planning ahead to maintain our financial performance.

## A Powerful Franchise with Numerous Growth Engines

During the year, while we were focused on realizing the synergies and delivering our cost savings from TCF, we did not take our foot off the pedal on our organic growth priorities. We also took proactive actions to reduce our core, “run-the-bank” expenses in anticipation of the rising inflation during the year while continuing to invest in our revenue-producing initiatives.

Commercial banking was a force for us this year and is four times the size it was over ten years ago. We have scaled and are operating with new and expanded markets and increased capabilities. We have a substantial presence, with several of our businesses in top 10 positions nationally, which was reflected in our broad-based loan growth in 2022. During the year, we were pleased to announce the acquisition of Capstone Partners, an industry-leading investment bank and advisory firm focused on

### INVESTING

for sustainable profitable growth

### DIFFERENTIATING

our culture, brand, and customer experience

### OPTIMIZING

for top quartile performance and value creation

middle market businesses. Capstone has already contributed to our record capital markets revenue in 2022, and we are excited about the continued growth opportunities.

In addition to Capstone Partners, we also completed the acquisition of Torana, now known as Huntington ChoicePay$^{SM}$. Torana provided an exciting and innovative area to continue to grow our payments offerings to customers. We also formally launched our enterprise payments function this year, which was highlighted in greater detail at our Investor Day. Payments is a key strategic fee income area for the bank, and we believe these actions demonstrate our dedication to driving long-term sustainable growth in this area.

Our commercial businesses are complemented by our industry-leading consumer franchise. We fundamentally believe we are in a people and relationship business, and we are dedicated to our local model. As part of the TCF acquisition, we deployed our products to all customers, expanded into new markets including the Twin Cities and Denver, and

substantively expanded our presence throughout Michigan and Chicago. In Small Business, we not only maintained our #1 SBA 7(a) lending program, but we completed nationwide expansion for SBA in the first quarter of 2022. Further, we increased our rank in new markets (Colorado and Minnesota) to #1 and #3, respectively. We are incredibly proud of this achievement and the opportunity going forward. And another example of how we are continuing to execute on our strategies is in Wealth Management, where we launched Unified Advisory, a bridge to better connect our banking customers with advisors. Finally, we were very pleased to be awarded the #1 Mobile App by JD Power for the fourth year in a row.$^{5}$

Our colleagues work tirelessly and are tremendous in working with our customers and communities. They are our brand and drive our performance, and their consistent performance is evidenced by our #1 rank in Trust, Net Promoter Score (NPS), and Customer Satisfaction.$^{6}$ The continuous investments in our Fair Play approach and our dedication to customer experience have supported our leading brand and strong acquisition of households and deposits in consumer for over a decade.

$^{3}$ Equipment Leasing & Finance Association, 2021, among bank-owned firms.

$^{4}$ Ranked first in loan origination by volume for the fifth year in a row.

$^{5}$ For J.D. Power 2022 award information, visit jdpower.com/award 2022

$^{6}$2021 Brand Tracking Market Study.

4 HUNTINGTON BANCSHARES INCORPORATED

![img-6.jpeg](img-6.jpeg)

Our industry leadership is also supported by our investments in digital innovation. We continue to launch disruptive products and work to extend our digital leadership. In addition to what we have done with Fair Play for our consumer and small business customers, we also continue to expand our digital capabilities in Commercial.

In Wealth Management and Small Business, we rolled out new digital capabilities to make it easier to do business with us and connect with our colleagues. Our scale and industry leadership, complemented by our continuous digital innovation, are key tenets of Huntington and how we drive value for our shareholders.

## Rigorous Credit Discipline

Credit quality continues to perform exceptionally well and remained a hallmark of Huntington over the course of the year. We have a diversified portfolio, and we are confident in our ability to manage through a challenging backdrop. We saw full-year net charge-offs of 0.11% of average loans, a decrease of 11 basis points year over year and well below our through-the-cycle range of 25-45 bps. Our nonperforming assets ratio came in at 0.50%, which was lower for the third consecutive year and the fourth consecutive quarter. Additionally, we have a top-tier reserve profile at 1.90%.

| 2022 Credit Score Card |  |  |
| --- | --- | --- |
| Net Charge-offs (% of average loans) | 0.11% | Through-the-Cycle Range: 25-45 bps |
| Allowance for Credit Losses (% of total loans) | 1.90% | Peer Median: 1.45% |
| Nonperforming Assets Ratio | 0.50% | 4 Consecutive quarters 3 Consecutive years |

As I mentioned earlier, we took meaningful and proactive steps to overhaul the risk management of Huntington when I joined over a dozen years ago. This was critical to our sustainable, future growth, and we are now very well positioned to operate in a challenging economy. We have a disciplined and rigorous approach to credit and risk management, with a strong balance sheet and top-tier reserves. We constantly operate within our aggregate moderate-to-low through-the-cycle risk appetite, and that approach is paired with a strong risk culture that permeates throughout the company.

## Culture and Purpose Drive Performance

Our colleagues bring our brand to life by living our Purpose every day through their actions. They have a great passion for serving our customers and helping our communities. At Huntington, we are committed to taking care of our colleagues because we believe they are our most important asset and the key to our success. We continue to look out for our colleagues -- from their well-being to their professional development. In early 2022, we raised our minimum wage to $19 per hour. And at our Investor Day, we announced another increase to our minimum wage to $20 per hour, effective in January 2023. We do our best to create relationships and a sense of well-being with our colleagues.

We also learn from our yearly Voice survey of our colleagues, where results and feedback are considered when we develop further enhancements to our wellness and benefits programs along with our professional development programs, such as tuition pre-imbursement and expanded scholarship programs. We listen, and we act, and that is reflected in our colleague retention and attraction metrics.

Additionally, we continue to advance our initiatives in Diversity, Equity, and Inclusion (DEI). This starts at the top with our Board of Directors and Executive Leadership Team, which are 50% diverse. At Investor Day we shared our goals around DEI initiatives, and we continue to work to achieve these goals.

Our commitment to both DEI and ESG is part of our Purpose. In 2022, we published our sixth annual ESG report, highlighting our commitment and progress on our various initiatives. Some of the key highlights of actions we took in 2022 are as follows:

- Received an AA rating for our ESG program from MSCI
- Joined PCAF to harmonize emissions data and climate reporting
- Expanded our internal resources related to ESG with the addition of a Chief ESG Officer and a Climate Risk Director.

2022 ANNUAL REPORT 5

We were humbled to be honored again by Newsweek as one of “America’s Most Responsible Companies” for the fourth consecutive year. We are a purpose-driven organization at Huntington, and we strive to continue to make the lives of our people better and strengthen the communities we serve.

![img-7.jpeg](img-7.jpeg)

Finally, our Directors demonstrate the same commitment to our Purpose and encourage us to continue to strengthen our award-winning culture. They provide strong governance and oversight of our initiatives and strategic plans. This year will mark the retirement of two of our Board members, Lizabeth (Beth) Ardisana and Bob Cubbin. Beth joined our Board from the merger with FirstMerit, and her experience as a chief executive officer and entrepreneur was instrumental in bringing insight and expertise to the organization. With a very successful career as a chief executive officer, Bob’s guidance and leadership over the years were significant, and we especially thank him for his service in his role as Chair of Human Resources and Compensation Committee. We want to thank Beth and Bob for their commitment, dedication, and energy. They will be greatly missed.

## Looking Ahead

After record performance in 2022, we are entering a more uncertain economic environment in 2023. We have undertaken numerous proactive steps to position us for a range of economic scenarios, and we are confident that we have the right momentum and foundation to operate and maintain our top-tier financial performance.

In 2023, we are focused on achieving our medium-term financial targets while operating in our aggregate moderate-to-low risk appetite. These targets are:

- Pre-Provision Net Revenue Growth, or PPNR, of 6-9% (represents a compound annual growth rate);
- Return on Tangible Common Equity, or ROTCE, of 20%+; and
- Positive Operating Leverage.

We believe these targets are the right strategic and financial metrics to deliver long-term shareholder value. We expect to achieve our targeted performance by the investments we have made, driving revenue growth in

our new and expanded markets, and continuing to find efficiencies across the franchise. We will continue to be good stewards of our capital, with a rigorous and disciplined approach to risk management.

We have never been better positioned to enter an uncertain outlook than we are today. We have extraordinary colleagues, numerous and diverse growth engines, efficiency opportunities, a committed management team who are operators, and highly engaged Directors. Our Directors and colleagues are collectively a Top 10 shareholder of Huntington. All of us are fully aligned with shareholders as we deliver on our commitment to driving shareholder value.

To our nearly 20,000 colleagues, thank you for a remarkable and record year. You drive our performance as you live our Purpose every day. To our customers, we continue to strive to deliver top-tier experience and to strengthen and transform the communities where we live and work. And to our shareholders, thank you for your continued support of Huntington.

A handwritten signature in black ink that reads 'Stephen D. Steinour'.

Stephen D. Steinour
Chairman, President, and Chief Executive Officer

6 HUNTINGTON BANCSHARES INCORPORATED

# OUR BOARD OF DIRECTORS

![img-8.jpeg](img-8.jpeg)

**Lizabeth Ardisana**
CEO and Principal Owner
ASG Renaissance, LLC

![img-9.jpeg](img-9.jpeg)

**Alanna Y. Cotton**
President and Chief Business Officer
Ferrero North America

![img-10.jpeg](img-10.jpeg)

**Ann B. "Tanny" Crane**
President and CEO
Crane Group Company

![img-11.jpeg](img-11.jpeg)

**Robert S. Cubbin**
Retired President and CEO
Meadowbrook Insurance Group

![img-12.jpeg](img-12.jpeg)

**Gina D. France**
CEO and President
France Strategic Partners LLC

![img-13.jpeg](img-13.jpeg)

**J. Michael Hochschwender**
CEO
The Smithers Group, Inc.

![img-14.jpeg](img-14.jpeg)

**Richard H. King**
Chairman
Metropolitan Airports Commission,
Minneapolis/St. Paul

![img-15.jpeg](img-15.jpeg)

**Katherine M. A. "Allie" Kline**
Founding Principal
LEO DIX

![img-16.jpeg](img-16.jpeg)

**Richard W. Neu**
Retired Chairman
MCG Capital Corporation

![img-17.jpeg](img-17.jpeg)

**Kenneth J. Phelan**
Senior Advisor
Oliver Wyman, Inc.

![img-18.jpeg](img-18.jpeg)

**David L. Porteous**
Attorney
McCurdy, Wotila & Porteous, P.C.
Independent Lead Director
Huntington Bancshares Incorporated

![img-19.jpeg](img-19.jpeg)

**Roger J. Sit**
CEO, Global Chief Investment Officer,
and Director
Sit Investment Associates, Inc.

![img-20.jpeg](img-20.jpeg)

**Stephen D. Steinour**
Chairman, President, and CEO
Huntington Bancshares Incorporated
President and CEO
The Huntington National Bank

![img-21.jpeg](img-21.jpeg)

**Jeffrey L. Tate**
Chief Financial Officer and
Executive Vice President
Leggett & Platt

![img-22.jpeg](img-22.jpeg)

**Gary Torgow**
Chairman
The Huntington National Bank

Board of Directors as of 12/31/2022

# OUR EXECUTIVE LEADERSHIP TEAM

**Stephen D. Steinour**
Chairman, President, and CEO,
Huntington Bancshares Incorporated
President and CEO,
The Huntington National Bank

**Michael Jones**
Senior Executive Vice President,
Head of Corporate Ventures,
Chair for Minnesota and Colorado

**Richard Pohle**
Executive Vice President,
Chief Credit Officer

**Michael Van Treese**
Executive Vice President,
Chief Auditor

**Donald Dennis**
Executive Vice President,
Chief Diversity, Equity, Inclusion &
Culture Officer

**Scott Kleinman**
Senior Executive Vice President,
Commercial Bank President

**Brant Standridge**
Senior Executive Vice President,
Consumer and Business Banking President

**Zachary Wasserman**
Senior Executive Vice President,
Chief Financial Officer

**Paul Heller**
Senior Executive Vice President,
Chief Technology and
Operations Officer

**Jana Litsey**
Senior Executive Vice President,
General Counsel

**Rajeev Syal**
Senior Executive Vice President,
Chief Human Resources Officer

**Helga Houston**
Senior Executive Vice President,
Chief Risk Officer

**Sandra Pierce**
Senior Executive Vice President,
Private Client Group & Regional
Banking Director, Chair of Michigan

**Julie Tutkovics**
Senior Executive Vice President,
Chief Marketing and
Communications Officer

2022 ANNUAL REPORT 7

# NON-GAAP RECONCILIATIONS

## Pre-Provision Net Revenue (PPNR) (\$ in millions)

|  | 2022 | 2021 | 2020 |
| --- | --- | --- | --- |
| Total revenue | $7,254 | $5,991 | $4,815 |
| FTE adjustment | 31 | 25 | 21 |
| Total revenue (FTE) (A) | 7,285 | 6,016 | 4,836 |
| Less: net gain / (loss) on securities | - | 9 | (1) |
| Total Revenue (FTE), excluding net gain / (loss) on securities and notable items (B) | 7,285 | 6,007 | 4,837 |
| Noninterest expense (C) | 4,201 | 4,375 | 2,795 |
| Less: Notable Items | 95 | 711 | - |
| Noninterest expense, excluding Notable Items (D) | 4,106 | 3,664 | 2,795 |
| Pre-provision net revenue (PPNR) (A-C) | $3,084 | $1,641 | $2,041 |
| PPNR, adjusted (B-D) | $3,179 | $2,343 | $2,042 |

## Return On Tangible Common Equity (ROTCE) (\$ in millions)

|  | 2022 |
| --- | --- |
| Average common shareholders' equity | $16,096 |
| Less: intangible assets and goodwill | 5,688 |
| Add: net tax effect of intangible assets | 47 |
| Average tangible common shareholders' equity (A) | $10,455 |
| Net income available to common | $2,125 |
| Add: amortization of intangibles | 54 |
| Add: deferred tax | (12) |
| Adjusted net income available to common (B) | $2,167 |
| Return on average tangible shareholders' equity (B/A) | 20.7% |

## Adjusted Return on Tangible Common Equity (ROTCE) (\$ in millions)

|  | 2022 |
| --- | --- |
| Adjusted net income available to common (B) | $2,167 |
| Return on average tangible shareholders' equity | 20.7% |
| Add: acquisition-related net expenses, after tax (C) | $76 |
| Adjusted net income available to common (D) | $2,243 |
| Adjusted return on average tangible shareholders' equity (D/A) | 21.5% |

![img-23.jpeg](img-23.jpeg)

8 HUNTINGTON BANCSHARES INCORPORATED

**UNITED STATES**
**SECURITIES AND EXCHANGE COMMISSION**
**WASHINGTON, D.C. 20549**

# **FORM 10-K**

☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended December 31, 2022
Commission File Number 1-34073

![img-0.jpeg](img-0.jpeg)

# **Huntington Bancshares Incorporated**

(Exact name of registrant as specified in its charter)

**Maryland**

(State or other jurisdiction of incorporation or organization)

**31-0724920**

(I.R.S. Employer Identification No.)

**41 South High Street**

(Address of principal executive offices)

**Columbus, Ohio**

**43287**

(Zip Code)

**Registrant's telephone number, including area code (614) 480-2265**

**Securities registered pursuant to Section 12(b) of the Act:**

| Title of class | Trading Symbol(s) | Name of exchange on which registered |
| --- | --- | --- |
| Depository Shares (each representing a 1/40th interest in a share of 4.500% Series H Non-Cumulative, perpetual preferred stock) | HBANP | NASDAQ |
| Depository Shares (each representing a 1/1000th interest in a share of 5.70% Series I Non-Cumulative, perpetual preferred stock) | HBANM | NASDAQ |
| Common Stock-Par Value $0.01 per Share | HBAN | NASDAQ |

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Exchange Act. ☒ Yes ☐ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. ☐ Yes ☒ No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☒
Non-accelerated filer ☐
Accelerated filer ☐
Smaller reporting company ☐
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act)

☐ Yes ☒ No

The aggregate market value of voting and non-voting common equity held by non-affiliates of the registrant as of June 30, 2022, determined by using a per share closing price of $12.03, as quoted by Nasdaq on that date, was $17,092,209,908. As of January 31, 2023, there were 1,443,016,884 shares of common stock with a par value of $0.01 outstanding.

#### **Documents Incorporated By Reference**

Part III of this Form 10-K incorporates by reference certain information from the registrant’s definitive Proxy Statement for the 2023 Annual Shareholders’ Meeting.

# **HUNTINGTON BANCSHARES INCORPORATED**
**INDEX**

| Glossary of Acronyms and Terms | 4 |
| --- | --- |
| Part I. |  |
| Item 1. Business | 7 |
| Item 1A. Risk Factors | 26 |
| Item 1B. Unresolved Staff Comments | 40 |
| Item 2. Properties | 40 |
| Item 3. Legal Proceedings | 41 |
| Item 4. Mine Safety Disclosures | 41 |
| Part II. |  |
| Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 42 |
| Item 6. [Reserved] | 42 |
| Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations | 42 |
| Introduction | 43 |
| Executive Overview | 43 |
| Discussion of Results of Operations | 46 |
| Risk Management and Capital: | 52 |
| Credit Risk | 54 |
| Market Risk | 65 |
| Liquidity Risk | 69 |
| Operational Risk | 74 |
| Compliance Risk | 75 |
| Capital | 75 |
| Business Segment Discussion | 78 |
| Additional Disclosures | 82 |
| Item 7A. Quantitative and Qualitative Disclosures About Market Risk | 86 |
| Item 8. Financial Statements and Supplementary Data | 86 |
| Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 162 |
| Item 9A. Controls and Procedures | 162 |
| Item 9B. Other Information | 162 |
| Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. | 162 |
| Part III. |  |
| Item 10. Directors, Executive Officers, and Corporate Governance | 162 |
| Item 11. Executive Compensation | 162 |
| Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 163 |
| Item 13. Certain Relationships and Related Transactions, and Director Independence | 163 |
| Item 14. Principal Accounting Fees and Services | 163 |
| Part IV. |  |
| Item 15. Exhibits and Financial Statement Schedules | 163 |
| Item 16. Form 10-K Summary | 163 |
| Signatures | 167 |

# Glossary of Acronyms and Terms

The following listing provides a comprehensive reference of common acronyms and terms used throughout the document:

| ACL | Allowance for Credit Losses |
| --- | --- |
| AFS | Available-for-Sale |
| ALCO | Asset-Liability Management Committee |
| ALLL | Allowance for Loan and Lease Losses |
| AML | Anti-Money Laundering |
| AOCI | Accumulated Other Comprehensive Income |
| ASC | Accounting Standards Codification |
| ATM | Automated Teller Machine |
| AULC | Allowance for Unfunded Lending Commitments |
| Bank Secrecy Act | Financial Recordkeeping and Reporting of Currency and Foreign Transactions Act of 1970 |
| Basel III | Refers to the final rule issued by the Federal Reserve and OCC and published in the Federal Register on October 11, 2013 |
| BHC | Bank Holding Company |
| BHC Act | Bank Holding Company Act of 1956 |
| Capstone Partners | Capstone Enterprises LLC |
| CARES Act | Coronavirus Aid, Relief, and Economic Security Act, as amended |
| C&I | Commercial and Industrial |
| CCAR | Comprehensive Capital Analysis and Review |
| CCB | Capital Conservation Buffer |
| CCPA | California Consumer Privacy Act of 2018 |
| CDs | Certificates of Deposit |
| CDI | Core Deposit Intangible |
| CECL | Current Expected Credit Losses |
| CET1 | Common equity tier 1 on a transitional Basel III basis |
| CFPB | Bureau of Consumer Financial Protection |
| CISA | Cybersecurity Information Sharing Act |
| CMO | Collateralized Mortgage Obligations |
| COVID-19 | Coronavirus Disease 2019 |
| CPPA | California Privacy Protection Act |
| CPRA | California Privacy Rights Act |
| CRA | Community Reinvestment Act |
| CRE | Commercial Real Estate |
| DEI | Diversity, Equity, and Inclusion |
| DIF | Deposit Insurance Fund |
| Dodd-Frank Act | Dodd-Frank Wall Street Reform and Consumer Protection Act |
| EAD | Exposure at Default |
| Economic Growth Act | Economic Growth, Regulatory Relief and Consumer Protection Act |
| ELT | Executive Leadership Team |
| EPS | Earnings Per Share |
| ESG | Environmental, Social, and Governance |
| EVE | Economic Value of Equity |
| FASB | Financial Accounting Standards Board |

4 Huntington Bancshares Incorporated

| FCRA | Fair Credit Reporting Act |
| --- | --- |
| FDIA | Federal Deposit Insurance Act |
| FDIC | Federal Deposit Insurance Corporation |
| Federal Reserve | Board of Governors of the Federal Reserve System |
| FHC | Financial Holding Company |
| FHLB | Federal Home Loan Bank |
| FICO | Fair Isaac Corporation |
| FinCEN | Financial Crimes Enforcement Network |
| FINRA | Financial Industry Regulatory Authority, Inc. |
| FRG | Financial Recovery Group |
| FTE | Fully-Taxable Equivalent or Full-Time Equivalent |
| FTP | Funds Transfer Pricing |
| FVO | Fair Value Option |
| GAAP | Generally Accepted Accounting Principles in the United States of America |
| GDP | Gross Domestic Product |
| GLBA | Gramm-Leach-Bliley Act |
| HIC | Huntington Investment Company |
| HMDA | Home Mortgage Disclosure Act |
| HPI | House Price Index |
| HTM | Held-to-Maturity |
| IRS | Internal Revenue Service |
| Last-of-Layer | Last-of-layer is a fair value hedge of the interest rate risk of a portfolio of similar prepayable assets whereby the last dollar amount within the portfolio of assets is identified as the hedged item |
| LCR | Liquidity Coverage Ratio |
| LFI Rating System | Large Financial Institution Rating System |
| LGD | Loss Given Default |
| LIBOR | London Interbank Offered Rate |
| LIHTC | Low Income Housing Tax Credit |
| LTV | Loan-to-Value |
| MBS | Mortgage-Backed Securities |
| MD&A | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
| MSA | Metropolitan Statistical Area |
| MSR | Mortgage Servicing Right |
| NAICS | North American Industry Classification System |
| NALs | Nonaccrual Loans |
| NCO | Net Charge-off |
| NII | Net Interest Income |
| NIM | Net Interest Margin |
| NM | Not Meaningful |
| NPAs | Nonperforming Assets |
| OCC | Office of the Comptroller of the Currency |
| OCI | Other Comprehensive Income (Loss) |
| OCR | Optimal Customer Relationship |
| OFAC | Office of Foreign Assets Control |
| OLEM | Other Loans Especially Mentioned |
| OPEC | Organization of the Petroleum Exporting Countries |
| OREO | Other Real Estate Owned |

2022 Form 10-K 5

| Patriot Act | Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 |
| --- | --- |
| PCAOB | Public Company Accounting Oversight Board |
| PCD | Purchased Credit Deteriorated |
| PD | Probability of Default |
| Plan | Huntington Bancshares Retirement Plan |
| PPP | Paycheck Protection Program |
| Problem Loans | Includes nonaccrual loans and leases, accruing loans and leases past due 90 days or more, troubled debt restructured loans, and criticized commercial loans |
| Capital and Liquidity Tailoring Rule | Refers to the changes to applicability thresholds for regulatory and capital and liquidity requirements, issued by the OCC, the Federal Reserve, and the FDIC |
| EPS Tailoring Rule | Refers to Prudential Standards for Large Bank Holding Companies and Savings and Loan Holding, issued by the Federal Reserve |
| Tailoring Rules | Refers to the Capital and Liquidity Tailoring Rule and the EPS Tailoring Rule |
| RBHPCG | Regional Banking and The Huntington Private Client Group |
| REIT | Real Estate Investment Trust |
| Riegle-Neal Act | The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 |
| ROC | Risk Oversight Committee |
| RWA | Risk-Weighted Assets |
| SBA | Small Business Administration |
| SCB | Stress Capital Buffer |
| SEC | Securities and Exchange Commission |
| SOFR | Secured Overnight Financing Rate |
| TCF | TCF Financial Corporation |
| TDR | Troubled Debt Restructuring |
| Torana | Digital Payments Torana, Inc. |
| U.S. Treasury | U.S. Department of the Treasury |
| UPB | Unpaid Principal Balance |
| VIE | Variable Interest Entity |
| XBRL | eXtensible Business Reporting Language |

6 Huntington Bancshares Incorporated

# Huntington Bancshares Incorporated

# PART I

When we refer to “Huntington,” “we,” “our,” “us,” and “the Company” in this report, we mean Huntington Bancshares Incorporated and our consolidated subsidiaries, unless the context indicates that we refer only to the parent company, Huntington Bancshares Incorporated. When we refer to the “Bank” in this report, we mean our only bank subsidiary, The Huntington National Bank, and its subsidiaries.

# Item 1: Business

We are a multi-state diversified regional bank holding company organized under Maryland law in 1966 and headquartered in Columbus, Ohio. Through the Bank, we are committed to making people’s lives better, helping businesses thrive, and strengthening the communities we serve and have over 150 years of servicing the financial needs of our customers. Through our subsidiaries, we provide full-service commercial and consumer deposit, lending, and other banking services. This includes, but not limited to, payments, mortgage banking, automobile, recreational vehicle and marine financing, investment banking, capital markets, advisory, equipment financing, distribution finance (formerly referred to as inventory finance), investment management, trust, brokerage, insurance and other financial products and services. As of December 31, 2022, our 1,032 full-service branches and private client group offices are primarily located in Ohio, Colorado, Illinois, Indiana, Kentucky, Michigan, Minnesota, Pennsylvania, West Virginia, and Wisconsin. Select financial services and other activities are also conducted in other states.

On June 9, 2021, Huntington closed the acquisition of TCF Financial Corporation in an all-stock transaction valued at $7.2 billion. TCF was a financial holding company headquartered in Detroit, Michigan with operations across the Midwest. The acquisition brought increased scale and market density, as well as added new markets and capabilities. Historical periods prior to June 9, 2021 reflect results of legacy Huntington operations. Subsequent to closing, results reflect all post-acquisition activity. For further information, refer to Note 3 “Business Combinations” of the Notes to the Condensed Consolidated Financial Statements.

In May 2022, Huntington completed the acquisition of Torana, now known as Huntington Choice Pay, a digital payments business focused on business to consumer payments. This acquisition along with the formation of our enterprise-wide payments group reflects one of our strategic priorities to accelerate our payments capabilities and expand the services provided to our customers.

In June 2022, Huntington completed the acquisition of Capstone Partners, a top tier middle market investment bank and advisory firm. The transaction brings a national scale to serve middle market business owners throughout the corporate lifecycle, building on Huntington’s regional banking foundation. Capstone Partners related revenue, including mergers and acquisitions, capital raising and other advisory-related fees, is recognized within capital markets fees in the Consolidated Statements of Income. For further information, refer to Note 3 “Business Combinations” of the Notes to the Condensed Consolidated Financial Statements.

Our business segments are based on our internally-aligned segment leadership structure, which is how we monitor results and assess performance. For each of our four business segments, we expect the combination of our business model, investment in products and capabilities, and exceptional service to provide a competitive advantage that supports revenue and earnings growth. Our business model emphasizes the delivery of a complete set of banking products and services offered by larger banks but distinguished by local delivery and customer service.

A key strategic emphasis has been for our business segments to operate in cooperation to provide products and services to our customers and to build stronger and more profitable relationships using our OCR sales and service process, which align to our vision to be the leading people-first, digitally powered bank. The objectives of OCR are to:

- Use a consultative and advisory sales approach to provide solutions that are specific to each customer.
- Leverage each business segment in terms of its products and expertise to benefit customers.
- Develop prospects who may want to have multiple products and services as part of their relationship with us.

2022 Form 10-K 7

Following is a description of our four business segments and the Treasury / Other function:

- **Commercial Banking:** The Commercial Banking segment provides expertise through bankers, capabilities, and digital channels, and includes a comprehensive set of product offerings. Our target clients span from mid-market to large corporate (greater than $2 billion in revenue) across a national footprint. The Commercial Banking segment leverages internal partnerships for wealth management, trust, insurance, payments, and treasury management capabilities. The segment is divided into five business units: (1) Middle Market Banking, (2) Corporate, Specialty, and Government Banking, (3) Asset Finance, (4) Commercial Real Estate Banking, and (5) Capital Markets.

Middle Market Banking serves the banking needs of mid-sized clients (greater than $20 million in revenue) who reside in our geographic footprint. We leverage our local presence to serve our clients, extending our full suite of banking products including lending, liquidity, treasury management, and capital markets.

Corporate, Specialty, and Government Banking serves medium to large enterprises. We focus on specific industry verticals such as government and non-profits, healthcare, technology and telecommunications, franchises, financial sponsors, and global services. Our expertise in these markets allows us to uniquely serve our clients’ sophisticated banking, capital markets, and payments requirements.

Asset Finance serves our clients’ capital expenditure and working capital needs through equipment financing, asset-based lending, distribution finance, structured lending, and municipal financing solutions. Our relationship with large manufacturers is bolstered by a strong commitment to their dealers and financing needs.

Commercial Real Estate Banking provides banking solutions to commercial real estate developers and institutional sponsors across the nation. Within this group, Huntington Community Development improves the quality of life for our communities and the residents of low-to-moderate income neighborhoods by developing and delivering innovative products and services to support affordable housing and neighborhood stabilization.

Capital Markets delivers corporate risk management, institutional sales and trading, capital and equity raising and advisory services to all Commercial Banking clients.

- **Consumer and Business Banking:** The Consumer and Business Banking segment provides a wide array of financial products and services to consumer and small business customers including, but not limited to, checking accounts, savings accounts, money market accounts, CDs, investments, consumer loans, credit cards, and small business loans. The Consumer and Business Banking segment leverages internal partnerships for mortgages, insurance, interest rate risk protection, foreign exchange, and treasury management. Huntington serves customers through our network of channels, including branches, online banking, mobile banking, telephone banking, and ATMs.

We have a “Fair Play” banking philosophy: providing differentiated products and services, built on a strong foundation of customer friendly products and advocacy. Our brand resonates with consumers and businesses, helping us acquire new customers and deepen relationships with current customers. Our Fair Play banking suite of products includes 24-Hour Grace®, Asterisk-Free Checking®, Money ScoutTM, $50 Safety ZoneTM, Standby Cash®, Early Pay, Instant Access, The Hub, and Huntington Heads Up®.

Business Banking is a dynamic part of our business, and we are committed to being the bank of choice for businesses in our markets. Business Banking is defined as serving companies with annual revenues up to $20 million. Beyond conventional lending solutions, Huntington offers access to capital markets, treasury management, practice finance and SBA lending capabilities. We are the #1 SBA lender in the nation in units as of federal fiscal year end September 30, 2022. Huntington continues to develop products and services that are designed specifically to meet the needs of small business and look for ways to help companies find solutions to their financing needs.

8 Huntington Bancshares Incorporated

Consumer Payments and Lending provides consumer and small business credit and debit cards primarily to our deposit customers as well as unsecured personal loans, personal lines, and other direct secured loans. The products are distributed through both branch and online channels. The product suite is aimed at meeting our customers' borrowing and transacting needs. The team continues to explore ways to innovate and continue to meet the evolving and rapidly changing payment needs of customers.

Through Consumer and Business Banking, we originate consumer loans and mortgages for customers who are generally located in our primary banking markets. Consumer and mortgage lending products are primarily distributed through the Consumer and Business Banking and RBHPCG segments, as well as through commissioned loan originators. Consumer and Business Banking earns interest on portfolio loans and loans held-for-sale, earns fee income from the origination and servicing of mortgage loans, and recognizes gains or losses from the sale of mortgage loans. Consumer and Business Banking supports the origination of mortgage loans across all segments.

- **Vehicle Finance:** Our products and services include providing financing to consumers for the purchase of automobiles, light-duty trucks, recreational vehicles, marine craft, and powersports at franchised and other select dealerships, and providing financing to franchised dealerships for the acquisition of new and used inventory. Products and services are delivered through highly specialized relationship-focused bankers and product partners. Huntington creates well-defined relationship plans which identify needs where solutions are developed and customer commitments are obtained.

The Vehicle Finance team services automobile dealerships, their owners, and consumers buying automobiles through these franchised dealerships. Huntington has provided new and used automobile financing and dealer services throughout the Midwest since the early 1950s. This consistency in the market and our focus on working with strong dealerships has allowed us to expand into select markets outside of the Midwest and to actively deepen relationships in 30 states while building a strong reputation. Huntington also provides financing for the purchase by consumers of recreational vehicles and marine craft on an indirect basis through dealerships in 35 states and for the purchase of powersports on an indirect basis through dealerships in 17 states.

- **Regional Banking and The Huntington Private Client Group:** Regional Banking and The Huntington Private Client Group is closely aligned with our regional banking markets. A fundamental point of differentiation is our commitment to be actively engaged within our local markets - building connections with community and business leaders and offering a uniquely personal experience delivered by colleagues working within those markets.

The core business of The Huntington Private Client Group is The Huntington Private Bank, which consists of Private Banking, Wealth & Investment Management, and Retirement Plan Services. The Huntington Private Bank provides high net-worth customers with deposit, lending (including specialized lending options), and other banking services. The Huntington Private Bank also delivers wealth management and legacy planning through investment and portfolio management, fiduciary administration, and trust services. This group also provides retirement plan services to corporate businesses. The Huntington Private Client Group also provides corporate trust services and institutional and mutual fund custody services.

- **Treasury / Other:** The Treasury / Other function includes technology and operations, other unallocated assets, liabilities, revenue, and expense.

The financial results for each of these business segments are included in Note 25 - 'Segment Reporting' of Notes to Consolidated Financial Statements and are discussed in the 'Business Segment Discussion' of our MD&A.

2022 Form 10-K 9

# ESG

# *ESG Oversight*

With oversight from our Board of Directors, we are committed to implementing strong ESG practices by living out our Purpose of making people's lives better, helping businesses thrive, and strengthening the communities we serve. The following represents how ESG is governed and integrated throughout the Company:

![img-1.jpeg](img-1.jpeg)

# ESG Strategy Team

The ESG Strategy Team, led by our Chief ESG Officer, is responsible for advancing the ESG strategy and facilitating implementation of the strategy at the segment- and business unit-level; ensuring consistent understanding of ESG strategy throughout the Company; and assisting with ESG goal setting, reporting, and monitoring. The Team also works to identify ESG-related innovation and advancement opportunities aligned with strategic planning for the enterprise. This group includes executive leaders across business segments and support units and meets regularly throughout the year.

# ESG Enterprise Working Group

The ESG Enterprise Working Group is primarily responsible for driving the overarching ESG strategy for the Company and making strategy recommendations to the Board; reporting ESG strategy, goals, and progress to the Board (typically on a quarterly basis); and publishing our various ESG disclosures, including the annual ESG Report. The ESG Working Group is comprised of a core, cross-functional group with representatives from our ESG, Investor Relations, Public Affairs, Legal, Corporate Communications, and Corporate Governance functions. To keep abreast of matters throughout the year, this group typically meets on a weekly basis.

# Climate Risk Management Team

The Climate Risk Management Team, led by our Climate Risk Director, is responsible for overseeing the development and maintenance of a comprehensive program to identify, measure, monitor, control, and report climate-related risks at Huntington.

# *Economic*

Our economic impact begins with a commitment to delivering sustainable, long-term shareholder value through financial performance, while maintaining an aggregate moderate-to-low, through-the-cycle risk appetite and a well-capitalized position. We align our corporate strategy to our purpose of helping others and building upon our market-leading, purpose-driven bank through focused efforts on the environmental, social and governance issues most important to our business and our stakeholders.

10 Huntington Bancshares Incorporated

Following the acquisition of TCF, in June 2021, we committed $40 billion toward a Community Plan to strengthen small businesses and foster economic justice through our footprint over the next five years. The Community Plan builds on the goals of our previous community plans, with expanded commitments focusing on increasing lending and services to address economic, social, environmental, and racial equity areas of need as follows:

- Huntington committed to providing $24 billion in affordable housing financing and consumer lending.
- Huntington expanded its Small Business lending programs into its new footprint and committed $10 billion to the programs.
- Huntington committed $6.5 billion in loans and investments to establish programs and services that foster equity in areas such as affordable housing, small business financing, and community services.
- Embedded in the areas of need above is a $16 billion commitment for Diversity, Equity, and Inclusion initiatives, with allocation of funds to diverse borrowers and communities to advance systemic change.

Huntington has additionally developed a Lift Local Business® program, and made a commitment of $100 million, which supports minority-, woman-, and veteran-owned small businesses throughout the business life cycle. This program offers loans, business planning support, free financial education courses delivered through Operation HOPE, and other services to help small business owners achieve their goals.

### *Environmental*

Huntington is committed to environmental stewardship. Our environmental strategy outlines our holistic approach to enhancing our environmental performance and reducing our carbon footprint. We demonstrate our commitment and transparency through our disclosures to CDP, a global initiative that allows us to track and submit data annually toward managing our carbon footprint and certain other aspects of our environmental impact, in addition to our reporting to the Task Force on Climate-Related Financial Disclosures framework.

In 2022, we appointed our first Chief ESG Officer, bringing focused leadership to all matters related to ESG. We have met and exceeded our target year 2022 goals we announced in 2017 to reduce our operational (Scope 1 and Scope 2) emissions, reduce our landfill waste, paper printing, and water consumption. We have also committed to shifting 50% of our electricity usage to renewable sources by 2035. In addition, we are developing an exploratory roadmap for achieving a net zero carbon future and are focused on understanding and analyzing the magnitude of our value chain emissions (Scope 3). We joined the Partnership for Carbon Accounting Financials, which will enable us to measure and assess emissions associated with our loans and investments.

### *Human Capital (Social)*

Huntington aspires to be a Category of One financial services institution: an organization unique in the combination of its culture and performance. Huntington had 19,920 average full-time equivalent colleagues during 2022, all of whom are encouraged to live out a shared purpose of making our colleagues' and customers' lives better, helping businesses thrive, and strengthening the communities we serve. We believe that our diverse workforce, supported by a culture of inclusiveness, enriches the experience of colleagues, and enhances our ability to perform as a company.

We engage with our colleagues to gain valuable feedback on a wide range of subjects related to the experience of working at Huntington, with a strategic focus on culture, trust, and engagement. We value the feedback colleagues choose to share and use the information to drive our talent management strategy, which focuses on four key areas and a commitment to diversity, equity, and inclusion:

- Engagement
- Development
- Retention, and
- Attraction of top talent

2022 Form 10-K 11

## Engagement

At Huntington, we have taken steps to ensure our values, beliefs, and behaviors align with those of our colleagues. We have highly engaged colleagues committed to looking out for each other and our customers with a balanced focus on “what we do” and “how we do it.” This synergy has proven to positively impact colleague performance and satisfaction. 2022 marked the ninth consecutive year we conducted a company-wide engagement survey to measure our colleagues’ experience with a strategic focus on culture, trust, and engagement - and the results were reaffirming. In 2022, 87%, 85%, and 84% of colleagues responded favorably on trust, culture, and engagement, respectively. 82% of colleagues responded they would recommend Huntington as a great place to work.

The annual company-wide engagement survey is just one element of our continual colleague feedback program, which includes quick colleague pulse, new hire, manager-specific, and exit surveys. These surveys enhance leader understanding of the colleague experience, position Huntington to respond to colleague needs, and provide strong support to colleagues as they deliver performance in the spirit of our Purpose and Values.

At Huntington, living our shared Purpose extends beyond our daily work. We believe that building connections between colleagues, their families and our communities create a meaningful, fulfilling, and enjoyable colleague experience. During 2022, Huntington colleagues provided over 35,000 volunteer hours to over 1,300 organizations across our footprint, including foodbanks, homeless shelters, local schools, senior housing, and afterschool programs.

## Development

We have created specialized programs to help our colleagues grow and develop. These programs include an online library which allows colleagues to take ownership of their development via direct access to role-based content. The content is divided into three key areas of development: learning and growth, maximizing performance, and protecting the company. All of the programming offered includes diversity, equity, and inclusion content. During 2022, colleagues at Huntington completed approximately 35 training hours per average full-time equivalent colleague, a 14% increase year over year. Huntington also provided a High-Potential Talent Development Program to top talent colleagues, so that they may further develop and accelerate their career growth. Additionally, we offer all colleagues the ability to obtain post-secondary education with reimbursement of tuition.

## Retention

Huntington is committed to creating an environment where colleagues are valued, supported, and empowered. We offer competitive rewards programs that further strengthen our employment value proposition and encourages colleague retention. Our compensation structure includes benefit plans and programs focused on multiple facets of well-being, including physical, mental, and financial wellness. Effective January 1, 2022 we increased the minimum hourly pay rate to $19 and further increased this rate to $20 effective January 1, 2023. We also offer Workplace Flex, a program of practices for colleagues, so that they can achieve a healthy balance between work and life outside of work. The program includes practices that enable colleagues multiple paths to achieving balance, including: flexible scheduling (staggered hours, compressed workweeks, part-time schedules, and job-sharing), flexible work location (remote, hybrid, and on-site), and both health and financial wellness support beyond the typical medical/visual/dental programs (adoption and fertility, parental leave, on-site fitness and fitness discounts, mental health and financial counseling services, support for chronic conditions). Collectively, these practices position colleagues to be their best self both at work and outside of work.

Huntington’s commitment to pay equity is unwavering to ensure that gender, race, and ethnicity are not determining factors in salaries, bonuses, and stock-based awards. We continue to identify and implement effective practices to promote pay equity, including pay analyses, additional hiring practices that protect pay equity, and training managers on explicit and implicit bias in compensation and promotion decisions. Huntington seeks to maintain approximately 100% pay equity.

Collectively, these strategies create a colleague experience that entices colleagues to stay and fulfill their goals with Huntington.

12 Huntington Bancshares Incorporated

### Attraction of top talent

We are dedicated to attracting top talent with an emphasis on experience and behaviors that align with our Purpose and our core values of 'Can Do Attitude, Forward Thinking, and Service Heart.'

The diversity of our colleagues is a key component of our success as an organization as it allows us to have a workforce that is representative of the communities we serve and is critical to our sustained success and growth. We proactively seek out a diverse candidate pool during the recruitment process across all levels. We are focused on identifying, supporting, and promoting qualified diverse candidates in leadership roles. As of December 31, 2022, our combined middle, senior, and executive management levels were 47% diverse and our total workforce was 67% diverse. For the purpose of reporting the aforementioned data, we acknowledge diverse individuals as those who are identified as women, or as being racially/ethnically diverse.

Our commitment to creating an inclusive, diverse environment through embracing different skills, backgrounds, and perspectives, both in our communities and at work is demonstrated through our DEI Strategy and Operating Plan. This plan encompasses four focus areas, workplace inclusion, workforce diversity, community engagement, and supplier diversity. We execute this strategy and operating plan in multiple ways. Our Chief Diversity, Equity, Inclusion and Culture Officer ensures Diversity, Equity, and Inclusion perspectives are an integral part of executive decisions made at Huntington. This is achieved by measuring and socializing progress on diversity across our footprint and providing diversity and inclusion programs to our colleagues. In addition, we have Inclusion Councils, Business Resource Groups and Communities of Practice to support our commitment to engage, develop, retain, and attract top diverse talent. Inclusion Councils are voluntary, colleague driven regional and office-specific councils that focus on an inclusive, respectful, and supportive environment for all colleagues. The Business Resource Groups are voluntary, colleague-driven groups organized around a shared interest or common diversity dimension, each sponsored by a senior executive. The Communities of Practice are colleague-led, volunteer affinity groups which share information and experiences with fellow members. All of these are important components to our inclusion strategy and deliver content throughout the year.

### Governance

Our Board of Directors and ELT are committed to executing on our long-term vision and aligning our strategic objectives with the interests of our stakeholders. Our Board members are accomplished leaders from diverse backgrounds, bringing the perspectives, skills, and experience necessary to use independent judgment that will effectively challenge and drive continued success. Our Board members approve the strategy, risk appetite, and ethical standards for the entire organization, and our ELT ensures our business and enterprise functions operate with high legal, ethical, and moral standards through clearly stated policies and procedures. Additionally, our leaders set the tone at the top and oversee compliance with our standards and direct the company's financial reporting and internal controls.

At the end of 2022, our Board consisted of 15 directors, comprised of our Chairman/President/CEO as well as our Huntington National Bank Chairman, and 13 independent directors. Our key risk and governance committees require at least three directors who are independent and are chaired by an independent director with the knowledge and expertise to lead the committee. As of December 31, 2022, our ELT and Board were 50% and 47% diverse, respectively.

### Competition

We compete with other banks and financial services companies such as savings and loans, credit unions, and finance and trust companies, as well as mortgage banking companies, equipment and automobile financing companies (including captive automobile finance companies), insurance companies, mutual funds, investment advisors, brokerage firms, and non-bank lenders both within and outside of our primary market areas. Financial Technology Companies, or FinTechs, are also providing nontraditional, but increasingly strong, competition for our borrowers, depositors, and other customers.

We compete for loans primarily on the basis of value and service by building customer relationships through addressing our customers' entire suite of banking needs, demonstrating expertise, and providing convenience. We also consider the competitive pricing pressures in each of our markets.

2022 Form 10-K 13

We compete for deposits similarly on the basis of value and service and by providing convenience through a banking network of branches and ATMs within our markets and our website at www.huntington.com. We employ customer friendly practices, such as a $50 Safety Zone$^{SM}$, which prevents customers from being charged an overdraft fee if they overdraw by $50 or less, 24-Hour Grace$^{®}$ account feature for both commercial and consumer accounts, which gives customers an additional business day to cover overdrafts to their account without being charged overdraft fees, Early Pay, which allows customers with direct deposit availability to their paycheck up to two days early, Instant Access, which allows up to $500 of a check deposit available to customers immediately, and Asterisk-free checking where there is no cost to open and no monthly maintenance fees. In addition, customers can qualify for Standby Cash$^{®}$ based primarily on their checking deposit history, not their credit score, which provides a $100 to $500 short-term line of credit free with automatic payments, or a 1% monthly interest charge without automatic payments. Huntington also has created a feature called Money Scout$^{SM}$, which is a tool that analyzes a customer’s spending habits and moves money that is not being used into that customer’s savings account and have introduced tools including The Hub and Huntington Heads Up$^{®}$ to provide customers greater visibility and control over their financial future. These measures fall under our approach of “Fair Play Banking.” Play Banking.'

The table below shows our competitive ranking and market share based on deposits of FDIC-insured institutions as of June 30, 2022, in the top 10 MSAs in which we compete:

| MSA | Rank | Deposits (in millions) | Market Share |
| --- | --- | --- | --- |
| Columbus, OH | 1 | $36,779 | 37% |
| Detroit, MI | 4 | 17,394 | 9 |
| Cleveland, OH | 2 | 14,486 | 12 |
| Chicago, IL | 12 | 9,112 | 2 |
| Minneapolis-St. Paul, MN | 5 | 6,523 | 3 |
| Grand Rapids, MI | 1 | 6,268 | 20 |
| Akron, OH | 1 | 5,487 | 27 |
| Indianapolis, IN | 5 | 5,329 | 6 |
| Cincinnati, OH | 4 | 4,649 | 3 |
| Pittsburgh, PA | 9 | 4,265 | 2 |

Source: FDIC.gov, based on June 30, 2022 survey.

Many of our nonfinancial institution competitors have fewer regulatory constraints, broader geographic service areas, greater capital, and, in some cases, lower cost structures. In addition, competition for quality customers has intensified as a result of changes in regulation, advances in technology and product delivery systems, and consolidation among financial service providers.

FinTechs continue to emerge in key areas of banking. In addition, larger established technology platform companies continue to evaluate, and in some cases, create businesses focused on banking products. We are closely monitoring activity in the marketplace to ensure that our products and services are technologically competitive. Further, we continue to invest in and evolve our innovation program to develop, incubate, and launch new products and services driving ongoing differentiated value for our customers. Our overall strategy involves an active corporate development program that seeks to identify partnership and possible investment opportunities in technology-driven companies that can augment our distribution and product capabilities.

## Regulatory Matters

### Regulatory Environment

The banking industry is highly regulated. We are subject to supervision, regulation, and examination by various federal and state regulators, including the Federal Reserve, OCC, SEC, CFPB, FDIC, FINRA, and various state regulatory agencies. The statutory and regulatory framework that governs us is generally intended to protect depositors and customers, the DIF, the U.S. banking and financial system, and financial markets as a whole.

14 Huntington Bancshares Incorporated

Banking statutes, regulations, and policies are continually under review by Congress, state legislatures, and federal and state regulatory agencies. In addition to laws and regulations, state and federal bank regulatory agencies may issue policy statements, interpretive letters, and similar written guidance applicable to Huntington and its subsidiaries. Any change in the statutes, regulations, or regulatory policies applicable to us, including changes in their interpretation or implementation, could have a material effect on our business or organization.

Under the Tailoring Rules, Huntington and the Bank each qualify as a Category IV banking organization subject to the least restrictive of the requirements applicable to firms with $100 billion or more in total consolidated assets.

Our business, however, remains subject to extensive regulation and supervision. Furthermore, the U.S. banking agencies may issue additional rules to tailor the application of certain other regulatory requirements to BHCs and banks, including Huntington and the Bank.

We are also subject to the disclosure and regulatory requirements of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, both as administered by the SEC, as well as the rules of Nasdaq that apply to companies with securities listed on the Nasdaq Global Select Market.

The following discussion describes certain elements of the comprehensive regulatory framework applicable to us. This discussion is not intended to describe all laws and regulations applicable to Huntington, the Bank, and Huntington’s other subsidiaries.

### *Huntington as a Bank Holding Company*

Huntington is registered as a BHC with the Federal Reserve under the BHC Act and qualifies for and has elected to become a FHC under the GLBA. As an FHC, Huntington is permitted to engage in, and be affiliated with companies engaging in, a broader range of activities than those permitted for a BHC. BHCs are generally restricted to engaging in the business of banking, managing, or controlling banks, and certain other activities determined by the Federal Reserve to be closely related to banking. FHCs may also engage in activities that are considered to be financial in nature, as well as those incidental or complementary to financial activities, including underwriting, dealing, and making markets in securities, and making merchant banking investments in non-financial companies. Huntington and the Bank must each remain “well-capitalized” and “well managed” in order for Huntington to maintain its status as an FHC. In addition, the Bank must receive a CRA rating of at least “Satisfactory” at its most recent examination for Huntington to engage in the full range of activities permissible for FHCs.

Huntington is subject to primary supervision, regulation, and examination by the Federal Reserve, which serves as the primary regulator of our consolidated organization. The primary regulators of our non-bank subsidiaries directly regulate the activities of those subsidiaries, with the Federal Reserve exercising a supervisory role. Such non-bank subsidiaries include, for example, broker-dealers and investment advisers both registered with the SEC.

### *The Bank as a National Bank*

The Bank is a national banking association chartered under the laws of the United States. As a national bank, the activities of the Bank are limited to those specifically authorized under the National Bank Act and OCC regulations. The Bank is subject to comprehensive primary supervision, regulation, and examination by the OCC. As a member of the DIF, the Bank is also subject to regulation and examination by the FDIC.

### *Supervision, Examination and Enforcement*

A principal objective of the U.S. bank regulatory regime is to protect depositors and customers, the DIF, the U.S. banking and financial system, and financial markets as a whole by ensuring the financial safety and soundness of BHCs and banks, including Huntington and the Bank. Bank regulators regularly examine the operations of BHCs and banks. In addition, BHCs and banks are subject to periodic reporting and filing requirements.

2022 Form 10-K 15

The Federal Reserve, OCC, and FDIC have broad supervisory and enforcement authority with regard to BHCs and banks, including the power to conduct examinations and investigations, impose nonpublic supervisory agreements, issue cease and desist orders, impose fines and other civil and criminal penalties, terminate deposit insurance, and appoint a conservator or receiver. In addition, Huntington, the Bank, and other Huntington subsidiaries are subject to supervision, regulation, and examination by the CFPB, which is the primary administrator of most federal consumer financial statutes and Huntington’s primary consumer financial regulator. Supervision and examinations are confidential, and the outcomes of these actions may not be made public.

Bank regulators have various remedies available if they determine that the financial condition, capital resources, asset quality, earnings prospects, management, liquidity, or other aspects of a banking organization’s operations are unsatisfactory. The regulators may also take action if they determine that the banking organization or its management is violating or has violated any law or regulation. The regulators have the power to, among other things, prohibit unsafe or unsound practices, require affirmative actions to correct any violation or practice, issue administrative orders that can be judicially enforced, direct increases in capital, direct the sale of subsidiaries or other assets, limit dividends and distributions, restrict growth, assess civil monetary penalties, remove officers and directors, and terminate deposit insurance.

Engaging in unsafe or unsound practices or failing to comply with applicable laws, regulations, and supervisory agreements could subject the Company, its subsidiaries, and their respective officers, directors, and institution-affiliated parties to the remedies described above, and other sanctions. In addition, the FDIC may terminate a bank’s deposit insurance upon a finding that the bank’s financial condition is unsafe or unsound or that the bank has engaged in unsafe or unsound practices or has violated an applicable rule, regulation, order, or condition enacted or imposed by the bank’s regulatory agency.

Huntington is subject to the Federal Reserve’s LFI Rating System, to align its supervisory rating system, which places a greater emphasis on capital and liquidity, including related planning and risk management practices as compared to the supervisory rating system applicable to smaller BHCs. These ratings will remain confidential.

### ***Bank Acquisitions by Huntington***

BHCs, such as Huntington, must obtain prior approval of the Federal Reserve in connection with any acquisition that results in the BHC owning or controlling 5% or more of any class of voting securities of a bank or another BHC.

### ***Acquisitions of Ownership of the Company***

Acquisitions of Huntington’s voting stock above certain thresholds are subject to prior regulatory notice or approval under federal banking laws, including the BHC Act and the Change in Bank Control Act of 1978. Under the Change in Bank Control Act, a person or entity generally must provide prior notice to the Federal Reserve before acquiring the power to vote 10% or more of our outstanding common stock. Investors should be aware of these requirements when acquiring shares in our stock.

### ***Interstate Banking***

Under the Riegle-Neal Act, a BHC may acquire banks in states other than its home state, subject to any state requirement that the bank has been organized and operating for a minimum period of time, not to exceed five years, and the requirement that the BHC not control, prior to or following the proposed acquisition, more than 10% of the total amount of deposits of insured depository institutions nationwide or, unless the acquisition is the BHC’s initial entry into the state, more than 30% of such deposits in the state (or such lesser or greater amount set by the state). The Riegle-Neal Act also authorizes banks to merge across state lines, thereby creating interstate branches. A national bank, such as the Bank, with the approval of the OCC may open a branch in any state if the law of that state would permit a state bank chartered in that state to establish the branch.

16 Huntington Bancshares Incorporated

## Regulatory Capital Requirements

Huntington and the Bank are subject to certain risk-based capital and leverage ratio requirements under the U.S. Basel III capital rules adopted by the Federal Reserve, for Huntington, and by the OCC, for the Bank. These rules implement the Basel III international regulatory capital standards in the United States, as well as certain provisions of the Dodd-Frank Act. These quantitative calculations are minimums, and the Federal Reserve and OCC may determine that a banking organization, based on its size, complexity, or risk profile, must maintain a higher level of capital in order to operate in a safe and sound manner.

Under the U.S. Basel III capital rules, Huntington's and the Bank's assets, exposures, and certain off-balance sheet items are subject to risk weights used to determine the institutions' risk-weighted assets. These risk-weighted assets are used to calculate the following minimum capital ratios for Huntington and the Bank:

- **CET1 Risk-Based Capital Ratio**, equal to the ratio of CET1 capital to risk-weighted assets. CET1 capital primarily includes common shareholders' equity subject to certain regulatory adjustments and deductions, including goodwill, intangible assets, certain deferred tax assets, and AOCI.
- **Tier 1 Risk-Based Capital Ratio**, equal to the ratio of Tier 1 capital to risk-weighted assets. Tier 1 capital is primarily comprised of CET1 capital, perpetual preferred stock, and certain qualifying capital instruments.
- **Total Risk-Based Capital Ratio**, equal to the ratio of total capital, including CET1 capital, Tier 1 capital, and Tier 2 capital, to risk-weighted assets. Tier 2 capital primarily includes qualifying subordinated debt and qualifying ALL. Tier 2 capital also includes, among other things, certain trust preferred securities.
- **Tier 1 Leverage Ratio**, equal to the ratio of Tier 1 capital to quarterly average assets (net of goodwill, certain other intangible assets, and certain other deductions).

Huntington and the Bank elected to temporarily delay certain effects of CECL on regulatory capital until January 1, 2022 pursuant to a rule that allowed BHCs and banks to delay for two years 100% of the day-one impact of adopting CECL and 25% of the cumulative change in the reported allowance for credit losses since adopting CECL. As of December 31, 2022, we have phased in 25% of the cumulative CECL deferral with the remaining impact to be recognized through the first quarter 2025.

The total minimum regulatory capital ratios and well-capitalized minimum ratios are reflected in the table below in this section. The Federal Reserve has not yet revised the well-capitalized standard for BHCs to reflect the higher capital requirements imposed under the U.S. Basel III capital rules. For purposes of the Federal Reserve's Regulation Y, including determining whether a BHC meets the requirements to be an FHC, BHCs, such as Huntington, must maintain a Tier 1 Risk-Based Capital Ratio of 6.0% or greater and a Total Risk-Based Capital Ratio of 10.0% or greater. If the Federal Reserve were to apply the same or a very similar well-capitalized standard to BHCs as that applicable to the Bank, Huntington's capital ratios as of December 31, 2022, would exceed such revised well-capitalized standard. The Federal Reserve may require BHCs, including Huntington, to maintain capital ratios substantially in excess of mandated minimum levels, depending upon general economic conditions and a BHC's particular condition, risk profile, and growth plans.

Failure to be well-capitalized or to meet minimum capital requirements could result in certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have an adverse material effect on our operations or financial condition. Failure to be well-capitalized or to meet minimum capital requirements could also result in restrictions on Huntington's or the Bank's ability to pay dividends or otherwise distribute capital or to receive regulatory approval of applications.

In addition to meeting the minimum capital requirements, under the U.S. Basel III capital rules, Huntington and the Bank must maintain the applicable capital buffer (SCB or CCB) requirements to avoid becoming subject to restrictions on capital distributions and certain discretionary bonus payments to management. Huntington is subject to a SCB of 3.3% effective for the period October 1, 2022 through September 30, 2023. Please refer to the SCB Requirements section below for further details. The Bank is subject to a CCB of 2.5%. The Tier 1 Leverage Ratio is not impacted by the SCB or CCB, and a banking institution may be considered well-capitalized while remaining out of compliance with the SCB or CCB.

2022 Form 10-K 17

The following table presents the minimum regulatory capital ratios, minimum ratio plus the capital buffer, and well-capitalized minimums compared with Huntington’s and the Bank’s regulatory capital ratios as of December 31, 2022, calculated using the regulatory capital methodology applicable as of the end of 2022.

|  |  | Minimum Regulatory Capital Ratio | Minimum Ratio + Capital Buffer (1) | Well- Capitalized Minimums (2) | At December 31, 2022 Actual |
| --- | --- | --- | --- | --- | --- |
| Ratios: |  |  |  |  |  |
| CET1 risk-based capital ratio | Consolidated | 4.50% | 7.80% | N/A | 9.36% |
|  | Bank | 4.50 | 7.00 | 6.50% | 9.98 |
| Tier 1 risk-based capital ratio | Consolidated | 6.00 | 9.30 | 6.00 | 10.90 |
|  | Bank | 6.00 | 8.50 | 8.00 | 10.83 |
| Total risk-based capital ratio | Consolidated | 8.00 | 11.30 | 10.00 | 13.09 |
|  | Bank | 8.00 | 10.50 | 10.00 | 12.47 |
| Tier 1 leverage ratio | Consolidated | 4.00 | N/A | N/A | 8.60 |
|  | Bank | 4.00 | N/A | 5.00 | 8.54 |

(1) Reflects a SCB of 3.3% for Huntington and CCB of 2.5% for the Bank.

(2) Reflects the well-capitalized standard applicable to Huntington under Federal Reserve Regulation Y and the well-capitalized standard applicable to the Bank.

Huntington has the ability to provide additional capital to the Bank to maintain the Bank’s risk-based capital ratios at levels which would be considered well-capitalized.

As of December 31, 2022, Huntington’s and the Bank’s regulatory capital ratios were above the well-capitalized standards and met the applicable capital buffer requirements.

### Liquidity Requirements

Under the Capital and Liquidity Tailoring Rule, Huntington, as a Category IV banking organization with less than $50 billion in weighted short-term wholesale funding, is exempt from the LCR and net stable funding ratio requirements but will continue to be subject to internal liquidity stress tests and standards.

### Enhanced Prudential Standards

Under the Dodd-Frank Act, as modified by the Economic Growth Act, BHCs with consolidated assets of more than $100 billion, such as Huntington, are currently subject to certain enhanced prudential standards. As a result, Huntington is subject to more stringent standards, including liquidity and capital requirements, leverage limits, stress testing, resolution planning, and risk management standards, than those applicable to smaller institutions. Certain larger banking organizations are subject to additional enhanced prudential standards.

As discussed in the Regulatory Environment section above, under the EPS Tailoring Rule, Huntington, as a Category IV banking organization, is subject to the least restrictive enhanced prudential standards applicable to firms with $100 billion or more in total consolidated assets. As compared to enhanced prudential standards that were applicable to Huntington, under the EPS Tailoring Rule, Huntington is no longer subject to company-run stress testing requirements and is subject to supervisory stress tests every other year (as opposed to annually), less frequent internal liquidity stress tests, and reduced liquidity risk management requirements.

### Capital Planning and Stress Testing

Huntington is required to develop, maintain, and submit to the Federal Reserve a capital plan every year, which is subject to supervisory review in connection with the Federal Reserve’s CCAR process. Huntington is required to include within its capital plan an assessment of the expected uses and sources of capital and a description of all planned capital actions over the nine-quarter planning horizon, a detailed description of the process for assessing capital adequacy, its capital policy, and a discussion of any expected changes to its business plan that are likely to have a material impact on its capital adequacy. Under the stress buffer requirements final rule adopted in 2020, the CCAR process is used to determine a BHC’s SCB requirement. Please refer to the SCB Requirements section below for further details.

18 Huntington Bancshares Incorporated

The Federal Reserve expects BHCs subject to CCAR, such as Huntington, to have sufficient capital to withstand a highly adverse operating environment and to be able to continue operations, maintain ready access to funding, meet obligations to creditors and counterparties, and serve as credit intermediaries. In addition, the Federal Reserve evaluates the planned capital actions of these BHCs, including planned capital distributions such as dividend payments or stock repurchases. This involves a quantitative assessment of capital based on supervisory-run stress tests that assess the ability to maintain capital levels above certain minimum ratios, after taking all capital actions included in a BHC’s capital plan, under baseline and stressful conditions throughout the nine-quarter planning horizon. As part of CCAR, the Federal Reserve evaluates whether BHCs have sufficient capital to continue operations throughout times of economic and financial market stress and whether they have robust, forward-looking capital planning processes that account for their unique risks. We are generally prohibited from making a capital distribution unless, after giving effect to the distribution, we will meet all minimum regulatory capital ratios. Huntington may increase its capital distributions in excess of the amount included in their capital plan without seeking prior approval from the Federal Reserve as long as it otherwise complies with the automatic restrictions on distributions under the Federal Reserve’s capital rules.

While the Federal Reserve is no longer allowed to object to the capital plan of a large and non-complex BHC, such as Huntington, on a qualitative, as opposed to quantitative, basis, the Federal Reserve may evaluate the strength of Huntington’s qualitative capital planning process through the regular supervisory process and targeted horizontal reviews of particular aspects of capital planning. In addition, under the stress buffer requirements final rule adopted in 2020, the Federal Reserve may no longer object to capital plans of BHCs, including Huntington, on a quantitative basis. Please refer to the SCB Requirements section below for further details.

### ***SCB Requirements***

In 2020, the Federal Reserve issued a final rule to integrate its annual capital planning and stress testing requirements with certain ongoing regulatory capital requirements. The final rule applies to certain BHCs, including Huntington, and introduces a stress capital buffer and related changes to the capital planning and stress testing processes.

For risk-based capital requirements, Huntington, as a large BHC, is provided an SCB by the Federal Reserve that is determined annually based on the greater of (i) the difference between its starting and minimum projected CET1 Risk-Based Capital Ratio under the severely adverse scenario in the supervisory stress test, plus the sum of the dollar amount of Huntington’s planned common stock dividends for each of the fourth through seventh quarters of the planning horizon as a percentage of risk-weighted assets, or (ii) 2.5%. Effective for the period of October 1, 2022 through September 20, 2023, Huntington’s SCB is 3.3%, an increase from its previous SCB of 2.5%.

The final rule also makes related changes to the capital planning and stress testing process. Among other changes, the revised capital plan rule eliminates the assumption that Huntington’s balance sheet assets would increase over the planning horizon. In addition, provided that Huntington is otherwise in compliance with automatic restrictions on distributions under the Federal Reserve’s capital rules, Huntington will no longer be required to seek prior approval to make capital distributions in excess of those included in its capital plan.

### ***Restrictions on Dividends***

Huntington is a legal entity separate and distinct from its banking and non-banking subsidiaries. Since our consolidated net income consists largely of net income of Huntington’s subsidiaries, our ability to make capital distributions, including paying dividends and repurchasing shares, depends upon our receipt of dividends from these subsidiaries. Under federal law, there are various limitations on the extent to which the Bank can declare and pay dividends to Huntington, including those related to regulatory capital requirements, general regulatory oversight to prevent unsafe or unsound practices, and federal banking law requirements concerning the payment of dividends out of net profits, surplus, and available earnings. Certain contractual restrictions also may limit the ability of the Bank to pay dividends to Huntington. No assurances can be given that the Bank will, in any circumstances, pay dividends to Huntington.

2022 Form 10-K 19

Huntington’s ability to declare and pay dividends to our shareholders is similarly limited by federal banking law and Federal Reserve regulations and policy. As discussed in the Capital Planning section above, a BHC may pay dividends and repurchase stock only in accordance with a capital plan that has been reviewed by the Federal Reserve and as to which the Federal Reserve has not objected.

Huntington and the Bank must maintain the applicable capital buffer requirements to avoid becoming subject to restrictions on capital distributions, including dividends. For more information on the capital buffer requirements, see the SCB Requirements and the Regulatory Capital Requirements sections above.

Federal Reserve policy provides that a BHC generally should not pay dividends unless (1) the BHC’s net income over the last four quarters (net of dividends paid) is sufficient to fully fund the dividends, (2) the prospective rate of earnings retention appears consistent with the capital needs, asset quality, and overall financial condition of the BHC and its subsidiaries, and (3) the BHC will continue to meet minimum required capital adequacy ratios. Accordingly, a BHC should not pay cash dividends that can only be funded in ways that weaken the BHC’s financial health, such as by borrowing. A BHC should inform the Federal Reserve reasonably in advance of declaring or paying a dividend that exceeds earnings for the period for which the dividend is being paid or that could result in a material adverse change to the BHC’s capital structure. BHCs should also consult with the Federal Reserve before increasing dividends or redeeming or repurchasing capital instruments. Additionally, the Federal Reserve could prohibit or limit the payment of dividends by a BHC if it determines that payment of the dividend would constitute an unsafe or unsound practice.

### ***Volcker Rule***

Under the Volcker Rule, we are prohibited from (1) engaging in short-term proprietary trading for our own account and (2) having certain ownership interests in and relationships with hedge funds or private equity funds (covered funds). The Volcker Rule regulations contain exemptions for market-making, hedging, underwriting, trading in U.S. government and agency obligations, and also permit certain ownership interests in certain types of covered funds to be retained. They also permit the offering and sponsoring of covered funds under certain conditions. The Volcker Rule regulations impose significant compliance and reporting obligations on banking entities, such as Huntington. We have put in place the compliance programs required by the Volcker Rule and have either divested or received extensions for any holdings in illiquid covered funds.

### ***Resolution Planning***

As a Category IV banking organization, Huntington is not required to submit a resolution plan to the Federal Reserve. As an insured depository institution, the Bank is required by FDIC regulation to file a resolution plan on a triennial basis. This requirement had been suspended since 2018, but the FDIC announced in June 2021 that it would resume requiring bank level resolution plans for large banks, including the Bank, and bank-level resolution plans will have more streamlined content requirements. During 2021, the Bank was informed by the FDIC that its next resolution plan was due on or before December 1, 2022. The Bank submitted its resolution plan to the FDIC on November 30, 2022, which is currently under review.

### ***Source of Strength***

Huntington is required to serve as a source of financial and managerial strength to the Bank and, under appropriate conditions, to commit resources to support the Bank. This support may be required by the Federal Reserve at times when we might otherwise determine not to provide it or when doing so is not otherwise in the interests of Huntington or our shareholders or creditors. The Federal Reserve may require a BHC to make capital injections into a troubled subsidiary bank and may charge the BHC with engaging in unsafe and unsound practices if the BHC fails to commit resources to such a subsidiary bank or if it undertakes actions that the Federal Reserve believes might jeopardize the BHC’s ability to commit resources to such subsidiary bank.

Under these requirements, Huntington may in the future be required to provide financial assistance to the Bank should it experience financial distress. Capital loans by Huntington to the Bank would be subordinate in right of payment to deposits and certain other debts of the Bank. In the event of Huntington’s bankruptcy, any commitment by Huntington to a federal bank regulatory agency to maintain the capital of the Bank would be assumed by the bankruptcy trustee and entitled to a priority of payment.

20 Huntington Bancshares Incorporated

### ***FDIC as Receiver or Conservator of Huntington***

Upon the insolvency of an insured depository institution, such as the Bank, the FDIC may be appointed as the conservator or receiver of the institution. Under the Orderly Liquidation Authority, upon the insolvency of a BHC, such as Huntington, the FDIC may be appointed as conservator or receiver of the BHC, if certain findings are made by the FDIC, the Federal Reserve, and the Secretary of the Treasury, in consultation with the President. Acting as a conservator or receiver, the FDIC would have broad powers to transfer any assets or liabilities of the institution without the approval of the institution's creditors.

### ***Depositor Preference***

The FDIA provides that, in the event of the liquidation or other resolution of an insured depository institution, including the Bank, the claims of depositors of the institution (including the claims of the FDIC as subrogee of insured depositors) and certain claims for administrative expenses of the FDIC as a receiver would have priority over other general unsecured claims against the institution. If the Bank were to fail, insured and uninsured depositors, along with the FDIC, would have priority in payment ahead of unsecured, non-deposit creditors, including Huntington, with respect to any extensions of credit they have made to such insured depository institution.

### ***Transactions between a Bank and its Affiliates***

Federal banking laws and regulations impose qualitative standards and quantitative limitations upon certain transactions between a bank and its affiliates, including between a bank and its holding company and companies that the BHC may be deemed to control for these purposes. Transactions covered by these provisions must be on arm's-length terms and cannot exceed certain amounts which are determined with reference to the Bank's regulatory capital. Moreover, if the transaction is a loan or other extension of credit, it must be secured by collateral in an amount and quality expressly prescribed by statute, and if the affiliate is unable to pledge sufficient collateral, the BHC may be required to provide it. The Dodd-Frank Act expanded the coverage and scope of these regulations, including by applying them to the credit exposure arising under derivative transactions, repurchase and reverse repurchase agreements, and securities borrowing and lending transactions. Federal banking laws also place similar restrictions on loans and other extensions of credit by FDIC-insured banks, such as the Bank, and their subsidiaries to their directors, executive officers, and principal shareholders.

### ***Lending Standards and Guidance***

The federal bank regulatory agencies have adopted uniform regulations prescribing standards for extensions of credit that are secured by liens or interests in real estate or made for the purpose of financing permanent improvements to real estate. Under these regulations, all insured depository institutions, such as the Bank, must adopt and maintain written policies establishing appropriate limits and standards for extensions of credit that are secured by liens or interests in real estate or are made for the purpose of financing permanent improvements to real estate. These policies must establish loan portfolio diversification standards, prudent underwriting standards (including loan-to-value limits) that are clear and measurable, loan administration procedures, and documentation, approval, and reporting requirements. The real estate lending policies must reflect consideration of the federal bank regulatory agencies' Interagency Guidelines for Real Estate Lending Policies.

### ***Heightened Governance and Risk Management Standards***

The OCC has published guidelines to set expectations for the governance and risk management practices of certain large financial institutions, including the Bank. The guidelines require covered institutions to establish and adhere to a written governance framework in order to manage and control their risk-taking activities. In addition, the guidelines provide standards for the institutions' boards of directors to oversee the risk governance framework. As discussed in the 'Risk Management and Capital' section of the MD&A, the Bank currently has a written governance framework and associated controls.

2022 Form 10-K 21

### ***Anti-Money Laundering***

The Bank Secrecy Act and the Patriot Act contain anti-money laundering and financial transparency provisions intended to detect and prevent the use of the U.S. financial system for money laundering and terrorist financing activities. The Bank Secrecy Act, as amended by the Patriot Act, requires depository institutions and their holding companies to undertake activities including maintaining an AML program, verifying the identity of customers, verifying the identity of certain beneficial owners for legal entity customers, monitoring for and reporting suspicious transactions, reporting on cash transactions exceeding specified thresholds, and responding to requests for information by regulatory authorities and law enforcement agencies. The Bank is subject to the Bank Secrecy Act and, therefore, is required to provide its employees with AML training, designate an AML compliance officer, and undergo an annual, independent audit to assess the effectiveness of its AML program. The Bank has implemented policies, procedures, and internal controls that are designed to comply with these AML requirements. Bank regulators are focusing their examinations on AML compliance, and we will continue to monitor and augment, where necessary, our AML compliance programs. The federal banking agencies are required, when reviewing bank and BHC acquisition or merger applications, to take into account the effectiveness of the AML activities of the applicant.

The Anti-Money Laundering Act of 2020, enacted on January 1, 2021 as part of the National Defense Authorization Act, does not directly impose new requirements on banks, but requires the U.S. Treasury to issue National Anti-Money Laundering and Countering the Financing of Terrorism Priorities, and conduct studies and issue regulations that may, over the next few years, significantly alter some of the due diligence, recordkeeping and reporting requirements that the Bank Secrecy Act and Patriot Act impose on banks. The Anti-Money Laundering Act of 2020 also contains provisions that promote increased information-sharing and use of technology and increases penalties for violations of the Bank Secrecy Act and includes whistleblower incentives, both of which could increase the prospect of regulatory enforcement.

### ***OFAC Regulation***

OFAC is responsible for administering economic sanctions that affect transactions with designated foreign countries, nationals, and others, as defined by various Executive Orders and in various legislation. OFAC-administered sanctions take many different forms. For example, sanctions may include: (1) restrictions on trade with or investment in a sanctioned country, including prohibitions against direct or indirect imports from and exports to a sanctioned country and prohibitions on U.S. persons engaging in financial transactions relating to, making investments in, or providing investment-related advice or assistance to, a sanctioned country; and (2) a blocking of assets in which the government or “specially designated nationals” of the sanctioned country have an interest, by prohibiting transfers of property subject to U.S. jurisdiction, including property in the possession or control of U.S. persons. OFAC also publishes lists of persons, organizations, and countries suspected of aiding, harboring, or engaging in terrorist acts, known as Specially Designated Nationals and Blocked Persons. Blocked assets, for example property and bank deposits, cannot be paid out, withdrawn, set off, or transferred in any manner without a license from OFAC. Failure to comply with these sanctions could have serious legal and reputational consequences.

### ***Data Privacy***

Federal and state law contains extensive consumer privacy protection provisions. The GLBA requires financial institutions to periodically disclose their privacy policies and practices relating to sharing such information and enables retail customers to opt out of our ability to share information with unaffiliated third parties under certain circumstances. Other federal and state laws and regulations impact our ability to share certain information with affiliates and non-affiliates for marketing and/or non-marketing purposes, or to contact customers with marketing offers. These security and privacy policies and procedures for the protection of personal and confidential information are in effect across all businesses and geographic locations as applicable. Federal law also makes it a criminal offense, except in limited circumstances, to obtain or attempt to obtain customer information of a financial nature by fraudulent or deceptive means.

22 Huntington Bancshares Incorporated

Data privacy and data protection are areas of increasing state legislative focus. For example, in June 2018, the Governor of California signed into law the CCPA. The CCPA, which became effective on January 1, 2020, applies to for-profit businesses that conduct business in California and meet certain revenue or data collection thresholds. The CCPA gives consumers the right to request disclosure of information collected about them, and whether that information has been sold or shared with others, the right to request deletion of personal information (subject to certain exceptions), the right to opt out of the sale of the consumer’s personal information, and the right not to be discriminated against for exercising these rights. The CCPA contains several exemptions, including that many, but not all, requirements of the CCPA are inapplicable to information that is collected, processed, sold, or disclosed pursuant to the GLBA. California voters also recently passed the CPRA, which took effect on January 1, 2023, and significantly modifies the CCPA, including imposing additional obligations on covered companies and expanding California consumers’ rights with respect to certain sensitive personal information. On July 8, 2022, the CPRA commenced formal rulemaking to adopt regulations to implement the CPRA. However, regulations did not come into effect prior to the CPRA’s effective date. The CPRA has stated that the earliest proposed regulations could be in effect in April 2023, potentially resulting in further uncertainty and requiring us to incur additional costs and expenses in an effort to comply with the regulations. In California, the CCPA, the CPRA, and upcoming regulations may be interpreted or applied in a manner inconsistent with our understanding. Numerous other states have also enacted or are in the process of enacting state-level privacy, data protection and/or data security laws and regulations. The federal government may also pass additional data privacy or data protection legislation, including possible amendment of the GLBA.

Like other lenders, the Bank and other of our subsidiaries use credit bureau data in their underwriting activities. Use of such data is regulated under the FCRA, and the FCRA also regulates reporting information to credit bureaus, prescreening individuals for credit offers, sharing of information between affiliates, and using affiliate data for marketing purposes. Similar state laws may impose additional requirements on us and our subsidiaries.

### ***FDIC Insurance***

The DIF provides insurance coverage for certain deposits, up to a standard maximum deposit insurance amount of $250,000 per depositor and is funded through assessments on insured depository institutions, based on the risk each institution poses to the DIF. The Bank accepts customer deposits that are insured by the DIF and, therefore, must pay insurance premiums. The FDIC may increase the Bank’s insurance premiums based on various factors, including the FDIC’s assessment of its risk profile.

The FDIC also requires large insured depository institutions, including the Bank, to maintain enhanced deposit account recordkeeping and related information technology system capabilities to facilitate prompt payment of insured deposits if such an institution were to fail.

The FDIC, as required under the FDIA, established a plan on September 15, 2020, to restore the DIF reserve ratio to meet or exceed the statutory minimum of 1.35% within eight years. This plan did not include an increase in the deposit insurance assessment rate. Based on the FDIC’s recent projections, however, the FDIC determined that the DIF reserve ratio is at risk of not reaching the statutory minimum by the statutory deadline of September 30, 2028 without increasing the deposit insurance assessment rates. In October 2022, the FDIC adopted a final rule to increase initial base deposit insurance assessment rate schedules uniformly by 2 basis points, beginning on January 1, 2023. The FDIC also concurrently maintained the Designated Reserve Ratio for the DIF at 2%.

### ***Compensation***

Our compensation practices are subject to oversight by the Federal Reserve and, with respect to some of our subsidiaries and employees, by other financial regulatory bodies. The scope and content of compensation regulation in the financial industry are continuing to develop, and we expect that these regulations and resulting market practices will continue to evolve over a number of years.

2022 Form 10-K 23

The federal bank regulatory agencies have issued joint guidance on executive compensation designed to ensure that the incentive compensation policies of banking organizations, such as Huntington and the Bank, do not encourage imprudent risk taking and are consistent with the safety and soundness of the organization. The SEC also finalized a rule that directs stock exchanges to require listed companies to implement clawback policies to recover incentive-based compensation from current or former executive officers in the event of certain financial restatements and requires companies to disclose their clawback policies and their actions under those policies.

### ***Cybersecurity***

The GLBA requires financial institutions to implement a comprehensive information security program that includes administrative, technical, and physical safeguards to ensure the security and confidentiality of customer records and information.

The CISA is intended to improve cybersecurity in the United States by enhanced sharing of information about security threats among the U.S. government and private sector entities, including financial institutions. The CISA also authorizes companies to monitor their own systems notwithstanding any other provision of law and allows companies to carry out defensive measures on their own systems from cyber-attacks. The law includes liability protections for companies that share cyber threat information with third parties so long as such sharing activity is conducted in accordance with CISA.

In addition, effective April 1, 2022, the Federal Reserve, OCC and FDIC issued a rule that, among other things, requires a banking organization to notify its primary federal regulators within 36 hours after identifying a “computer-security incident” that the banking organization believes in good faith could materially disrupt, degrade or impair its business or operations in a manner that would, among other things, jeopardize the viability of its operations, result in customers being unable to access their deposit and other accounts, result in a material loss of revenue, profit or franchise value, or pose a threat to the financial stability of the United States.

### ***Community Reinvestment Act***

The CRA is intended to encourage banks to help meet the credit needs of their service areas, including low- and moderate-income neighborhoods, consistent with safe and soundness practices. The relevant federal bank regulatory agency, the OCC in the Bank’s case, examines each bank and assigns it a public CRA rating. A bank’s record of fair lending compliance is part of the resulting CRA examination report.

The CRA requires the relevant federal bank regulatory agency to consider a bank’s CRA assessment when considering the bank’s application to conduct certain mergers or acquisitions or to open or relocate a branch office. The Federal Reserve also must consider the CRA record of each subsidiary bank of a BHC in connection with any acquisition or merger application filed by the BHC. An unsatisfactory CRA record could substantially delay or result in the denial of an approval or application by Huntington or the Bank. The Bank received the highest possible overall CRA rating of “Outstanding” in its most recent examination.

In June 2022, the Federal Reserve, FDIC, and OCC issued a joint proposal to amend their regulations implementing the CRA. The proposed rules would materially revise the current CRA framework, including new assessment area requirements, new methods of calculating credit for lending, investment, and service activities, and additional data collection and reporting requirements. The proposed rule included analysis indicating a significant increase in the thresholds for large banks to receive “Outstanding” ratings in the future.

### ***Debit Interchange Fees***

We are subject to a statutory requirement that interchange fees for electronic debit transactions that are paid to or charged by payment card issuers, including the Bank, be reasonable and proportional to the cost incurred by the issuer. Interchange fees for electronic debit transactions are limited to 21 cents plus 0.05% of the transaction, plus an additional one cent per transaction fraud adjustment. These fees impose requirements regarding routing and exclusivity of electronic debit transactions. On October 3, 2022, the Federal Reserve finalized a rule that amends Regulation II to, among other things, specify that debit card issuers should enable all debit card transactions, including card-not-present transactions such as online payments, to be processed on at least two unaffiliated payment card networks. The final rule becomes effective July 1, 2023. As an issuer with over $10 billion in assets, Huntington is subject to Regulation II and will work to implement these new requirements.

24 Huntington Bancshares Incorporated

### Consumer Protection Regulation and Supervision

We are subject to supervision and regulation by the CFPB with respect to federal consumer protection laws. We are also subject to certain state consumer protection laws, and under the Dodd-Frank Act, state attorneys general and other state officials are empowered to enforce certain federal consumer protection laws and regulations. State authorities have increased their focus on and enforcement of consumer protection rules. These federal and state consumer protection laws apply to a broad range of our activities and to various aspects of our business and include laws relating to interest rates, fair lending, disclosures of credit terms and estimated transaction costs to consumer borrowers, debt collection practices, the use of and the provision of information to consumer reporting agencies, and the prohibition of unfair, deceptive, or abusive acts or practices in connection with the offer, sale, or provision of consumer financial products and services.

The CFPB has promulgated many mortgage-related final rules since it was established under the Dodd-Frank Act, including rules related to the ability to repay and qualified mortgage standards, mortgage servicing standards, loan originator compensation standards, high-cost mortgage requirements, HMDA requirements, and appraisal and escrow standards for higher priced mortgages. The mortgage-related final rules issued by the CFPB have materially restructured the origination, servicing, and securitization of residential mortgages in the United States. These rules have impacted, and will continue to impact, the business practices of mortgage lenders, including the Company.

In January 2021, the OCC released a final rule that would require certain OCC-supervised banks to provide access to services, capital, and credit based on their risk assessment of individual customers, rather than broad-based decisions affecting whole categories or classes of customers, which includes requiring banks to make each financial service they offer available to all persons in the geographic market served by them on proportionally equal terms. The rule was scheduled to take effect on April 1, 2021, but the OCC has delayed the effective date indefinitely. However, the OCC announced that the next confirmed Comptroller of the Currency will review the final rule, and its future remains uncertain.

### Available Information

We are subject to the informational requirements of the Exchange Act and, in accordance with the Exchange Act, we file annual, quarterly, and current reports, proxy statements, and other information with the SEC. The SEC maintains an Internet web site that contains reports, proxy statements, and other information about issuers, like us, who file electronically with the SEC. The address of the site is http://www.sec.gov. The reports and other information, including any related amendments, filed by us with, or furnished by us to, the SEC are also available free of charge at our Internet web site as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. The address of the site is http://www.huntington.com. Except as specifically incorporated by reference into this Annual Report on Form 10-K, information on those web sites is not part of this report. You also should be able to inspect reports, proxy statements, and other information about us at the offices of the Nasdaq National Market at 33 Whitehall Street, New York, New York 10004.

2022 Form 10-K 25

## Item 1A: Risk Factors

The risks and uncertainties listed below present risks that could have a material impact on Huntington's financial condition, the results of operations or its business. Some of these risks and uncertainties are interrelated and the occurrence of one or more of them may exacerbate the effect of others. The risks and uncertainties described below are not the only ones Huntington faces. Additional risks and uncertainties not presently known to Huntington or that Huntington believes to be immaterial may also adversely affect its business. Additionally refer to factors set forth under the caption "Forward-Looking Statements." For more information on how we manage risks, see discussion in the "Risk Governance" section of our MD&A.

In addition to the other information included or incorporated by reference into this report, readers should carefully consider that the following important factors, among others, could negatively impact our business, future results of operations, and future cash flows materially.

# ***Credit Risks:***

**Our ACL level may prove to not be adequate or be negatively affected by credit risk exposures which could adversely affect our net income and capital.**

Our business depends on the creditworthiness of our customers. Our ACL of $2.3 billion at December 31, 2022, represented management's estimate of the current expected losses in our loan and lease portfolio (ALLL) as well as our unfunded lending commitments (AULC). We regularly review our ACL for appropriateness. In doing so, we consider probability of default, loss given default and exposure at default depending on economic parameters for each month of the remaining contractual term of the credit exposure. The economic parameters are developed using available information relating to past events, current conditions, and reasonable and supportable forecasts. There is no certainty that our ACL will be appropriate over time to cover lifetime losses of the portfolio because of unanticipated adverse changes in the economy, market conditions, or events adversely affecting specific customers, industries, or markets. If the credit quality of our customer base materially decreases, if the risk profile of a market, industry, or group of customers changes materially, or if the ACL is not appropriate, our net income and capital could be materially adversely affected, which could have a material adverse effect on our financial condition and results of operations.

In addition, regulatory review of risk ratings and loan and lease losses may impact the level of the ACL and could have a material adverse effect on our financial condition and results of operations.

# **Weakness in economic conditions could adversely affect our business.**

Continued economic uncertainty and a recessionary or stagnant economy could adversely affect our business, financial condition, and results of operations. Our performance could be negatively affected to the extent there is deterioration in business and economic conditions, including persistent inflation, rising interest rates, supply chain issues or labor shortages, which have direct or indirect material adverse impacts on us, our customers, and our counterparties. These conditions could result in one or more of the following:

- A decrease in the demand for loans and other products and services offered by us;
- A decrease in customer savings generally and in the demand for savings and investment products offered by us; and
- An increase in the number of customers and counterparties who become delinquent, file for protection under bankruptcy laws, or default on their loans or other obligations to us.
- An increase in the number of delinquencies, bankruptcies, or defaults could result in a higher level of NPAs, NCOs, provision for credit losses, and valuation adjustments on loans held for sale.

The markets we serve are dependent on industrial and manufacturing businesses and, thus, are particularly vulnerable to adverse changes in economic conditions affecting these sectors.

26 Huntington Bancshares Incorporated

A U.S. government debt default would have a material adverse impact on our business and financial performance, including a decrease in the value of Treasury bonds and other government securities held by us, which could negatively impact the Bank’s capital position and its ability to meet regulatory requirements. Other negative impacts could be volatile capital markets, an adverse impact on the U.S. economy and the U.S. dollar, as well as increased default rates among borrowers in light of increased economic uncertainty. Some of these impacts might occur even in the absence of an actual default but as a consequence of extended political negotiations around the threat of such a default and a government shutdown.

### ***Market Risks:***

**Changes in interest rates could reduce our net interest income, reduce transactional income, and negatively impact the value of our loans, securities, and other assets. This could have an adverse impact on our cash flows, financial condition, results of operations, and capital.**

Our results of operations depend substantially on net interest income, which is the difference between interest earned on interest earning assets (such as investments and loans) and interest paid on interest bearing liabilities (such as deposits and borrowings). Interest rates are highly sensitive to many factors, including governmental monetary policies, inflation, and domestic and international economic and political conditions. Conditions such as inflation, deflation, recession, unemployment, money supply, and other factors beyond our control may also affect interest rates. In addition, decisions by the Federal Reserve to increase or reduce the size of its balance sheet or to engage in tapering its purchase of assets may also affect interest rates. If our interest earning assets mature or reprice faster than interest bearing liabilities in a declining interest rate environment, net interest income could be materially adversely impacted. Likewise, if interest bearing liabilities mature or reprice more quickly than interest earning assets in a rising interest rate environment, net interest income could be adversely impacted.

Changes in interest rates can affect the value of loans, securities, assets under management, and other assets, including mortgage servicing rights. An increase in interest rates that adversely affects the ability of borrowers to pay the principal or interest on loans and leases may lead to an increase in NPAs and a reduction of income recognized, which could have a material adverse effect on our results of operations and cash flows. When we place a loan on nonaccrual status, we reverse any accrued but unpaid interest receivable, which decreases interest income. However, we continue to incur interest expense as a cost of funding NALs without any corresponding interest income. In addition, transactional income, including trust income, brokerage income, and gain on sales of loans can vary significantly from period-to-period based on a number of factors, including the interest rate environment. A decline in interest rates along with a flattening yield curve limits our ability to reprice deposits given the current historically low level of interest rates and could result in declining net interest margins if longer duration assets reprice faster than deposits.

Rising interest rates reduce the value of our fixed-rate securities. Any unrealized loss from these portfolios impacts OCI, shareholders’ equity, and the Tangible Common Equity ratio. Any realized loss from these portfolios impacts regulatory capital ratios. In a rising interest rate environment, pension and other post-retirement obligations somewhat mitigate negative OCI impacts from securities and financial instruments. For more information, refer to “Market Risk” of the MD&A.

Certain investment securities, notably mortgage-backed securities, are sensitive to rising and falling rates. Generally, when rates rise, prepayments of principal and interest will decrease, and the duration of mortgage-backed securities will increase. Conversely, when rates fall, prepayments of principal and interest will increase, and the duration of mortgage-backed securities will decrease. In either case, interest rates have a significant impact on the value of mortgage-backed securities.

MSR fair values are sensitive to movements in interest rates, as expected future net servicing income depends on the projected outstanding principal balances of the underlying loans, which can be reduced by prepayments. Prepayments usually increase when mortgage interest rates decline and decrease when mortgage interest rates rise.

In addition to volatility associated with interest rates, the Company also has exposure to equity markets related to the investments within the benefit plans and other income from client-based transactions.

2022 Form 10-K 27

### **Inflation could negatively impact our business, our profitability, and our stock price.**

Prolonged periods of inflation may impact our profitability by negatively impacting our fixed costs and expenses, including increasing funding costs and expense related to talent acquisition and retention. Additionally, inflation may lead to a decrease in consumer and clients' purchasing power and negatively affect the need or demand for our products and services. If significant inflation continues, our business could be negatively affected by, among other things, increased default rates leading to credit losses which could decrease our appetite for new credit extensions. These inflationary pressures could result in missed earnings and budgetary projections causing our stock price to suffer.

### **Industry competition may have an adverse effect on our success.**

Our profitability depends on our ability to compete successfully. We operate in a highly competitive environment, and we expect competition to intensify. Certain of our competitors are larger and have more resources than we do, enabling them to be more aggressive than us in competing for loans and deposits. In our market areas, we face competition from other banks and financial service companies that offer similar services. Some of our non-bank competitors are not subject to the same extensive regulations we are and, therefore, may have greater flexibility in competing for business. Technological advances have made it possible for our non-bank competitors to offer products and services that traditionally were banking products and for financial institutions and other companies to provide electronic and internet-based financial solutions, including mobile payments, online deposit accounts, electronic payment processing, and marketplace lending, without having a physical presence where their customers are located. Legislative or regulatory changes also could lead to increased competition in the financial services sector. For example, the Economic Growth Act and the Tailoring Rules reduce the regulatory burden of certain large BHCs and raise the asset thresholds at which more onerous requirements apply, which could cause certain large BHCs to become more competitive or to more aggressively pursue expansion. Our ability to compete successfully depends on a number of factors, including customer convenience, quality of service by investing in new products and services, electronic platforms, personal contacts, pricing, and range of products. If we are unable to successfully compete for new customers and retain our current customers, our business, financial condition, or results of operations may be adversely affected. In particular, if we experience an outflow of deposits as a result of our customers seeking investments with higher yields or greater financial stability, or a desire to do business with our competitors, we may be forced to rely more heavily on borrowings and other sources of funding to operate our business and meet withdrawal demands, thereby adversely affecting our net interest margin. For more information, refer to 'Competition' section of Item 1: Business.

### **The transition away from LIBOR may adversely affect our business.**

Central banks around the world, including the Federal Reserve, have commissioned committees and working groups of market participants and official sector representatives to replace LIBOR and replace or reform other interest rate benchmarks. The publication of most LIBOR rates ceased as of the end of December 2021, while certain U.S. dollar LIBOR tenors are expected to continue to be published until June 30, 2023.

A transition away from the widespread use of LIBOR to alternative rates and other potential interest rate benchmark reforms has begun and will continue over the course of the next few years. These reforms may cause such rates to perform differently than in the past, or to disappear entirely, or have other consequences which cannot be predicted.

A group of market participants convened by the Federal Reserve, the Alternative Reference Rate Committee (ARRC), has selected SOFR as its recommended alternative to LIBOR. The Federal Reserve Bank of New York started to publish SOFR in April 2018. SOFR is a broad measure of the cost of overnight borrowings collateralized by Treasury securities that was selected by the ARRC due to the depth and robustness of the U.S. Treasury repurchase market. In January of 2020, Huntington was added as an ARRC member. The passage of the Adjustable Interest Rate (LIBOR) Act by Congress, and the Federal Reserve's implementing rule, should decrease the risk of contracts that are not remediated prior to the cessation deadline by providing the terms for a transition to SOFR.

28 Huntington Bancshares Incorporated

The market transition away from LIBOR to an alternative reference rate, such as SOFR, is complex and could have a range of adverse effects on our business, financial condition, and results of operations. In particular, any such transition could:

- Adversely affect the interest rates paid or received on, the revenue and expenses associated with or the value of Huntington's LIBOR-based assets and liabilities, which include certain variable rate loans, Huntington's Series B preferred stock, certain of Huntington's junior subordinated debentures, certain of the Bank's senior notes and certain other securities or financial arrangements;
- Adversely affect the interest rates paid or received on, the revenue and expenses associated with or the value of other securities or financial arrangements, given LIBOR's role in determining market interest rates globally;
- Prompt inquiries or other actions from regulators in respect of Huntington's preparation and readiness for the replacement of LIBOR with an alternative reference rate; and
- Result in disputes, litigation, or other actions with counterparties regarding the interpretation and enforceability of certain fallback language in LIBOR-based contracts and securities.

Huntington implemented a LIBOR transition plan in 2018. As of December 31, 2021, the company ceased issuance of new LIBOR loans. Alternative reference rates at this time are predominantly SOFR-based. Systems, products, and analytics have been effectively transitioned away from LIBOR and are utilizing alternative reference rates. Remaining LIBOR transition project activities include remediation of remaining LIBOR products, including acquired products from TCF by June of 2023. We continue to assess the impact on our customers, with any needed LIBOR exceptions escalated to ELT for approval.

The manner and impact of the transition from LIBOR to an alternative reference rate, as well as the effect of these developments on our funding costs, loan, and investment and trading securities portfolios, asset-liability management, and business, is uncertain.

#### *Liquidity Risks:*

**Changes in Huntington's financial condition or in the general banking industry, or changes in interest rates, could result in a loss of depositor confidence.**

Liquidity is the ability to meet cash flow needs on a timely basis at a reasonable cost. The Bank uses its liquidity to extend credit and to repay liabilities as they become due or as demanded by customers.

Our primary source of liquidity is our large supply of deposits from consumer and commercial customers. The continued availability of this supply depends on customer willingness to maintain deposit balances with banks in general and us in particular. The availability of deposits can also be impacted by regulatory changes (e.g., changes in FDIC insurance, liquidity requirements, etc.), changes in the financial condition of Huntington, other banks, or the banking industry in general, changes in the interest rates our competitors pay on their deposits, and other events which can impact the perceived safety or economic benefits of bank deposits. While we make significant efforts to consider and plan for hypothetical disruptions in our deposit funding, market-related, geopolitical, or other events could impact the liquidity derived from deposits.

**We are a holding company and depend on dividends by our subsidiaries for most of our funds.**

Huntington is an entity separate and distinct from the Bank. The Bank conducts most of our operations, and Huntington depends upon dividends from the Bank to service Huntington's debt and to pay dividends to Huntington's shareholders. The availability of dividends from the Bank is limited by various statutes and regulations. It is possible, depending upon the financial condition including liquidity and capital adequacy of the Bank and other factors, that the OCC could limit the payment of dividends or other payments to Huntington by the Bank. In addition, the payment of dividends by our other subsidiaries is also subject to the laws of the subsidiary's state of incorporation, and regulatory capital and liquidity requirements applicable to such subsidiaries. In the event that the Bank was unable to pay dividends to us, we in turn would likely have to reduce or stop paying dividends on our Preferred and Common Stock. Our failure to pay dividends on our Preferred and Common Stock could have a material adverse effect on the market price of our Preferred and Common Stock. Additional information regarding dividend restrictions is provided in Item 1: Business - Regulatory Matters.

2022 Form 10-K 29

**If we lose access to capital markets, we may not be able to meet the cash flow requirements of our depositors, creditors, and borrowers, or have the operating cash needed to fund corporate expansion and other corporate activities.**

Wholesale funding sources can include securitization, federal funds purchased, securities sold under repurchase agreements, non-core deposits, and long-term debt. The Bank is also a member of the FHLB, which provides members access to funding through advances collateralized with mortgage-related assets. We maintain a portfolio of highly-rated, marketable securities that is available as a source of liquidity.

Capital markets disruptions can directly impact the liquidity of Huntington and the Bank. The inability to access capital markets funding sources as needed could adversely impact our financial condition, results of operations, cash flows, and level of regulatory-qualifying capital. We may, from time-to-time, consider using our existing liquidity position to opportunistically retire outstanding securities in privately negotiated or open market transactions.

**A reduction in our credit rating could adversely affect our access to capital and could increase our cost of funds.**

The credit rating agencies regularly evaluate Huntington and the Bank, and credit ratings are based on a number of factors, including our financial strength and ability to generate earnings, as well as factors not entirely within our control, including conditions affecting the financial services industry, the economy, and changes in rating methodologies. There can be no assurance that we will maintain our current credit ratings. A downgrade of the credit ratings of Huntington or the Bank could adversely affect our access to liquidity and capital, and could significantly increase our cost of funds, trigger additional collateral or funding requirements, and decrease the number of investors and counterparties willing to lend to us or purchase our securities. This could affect our growth, profitability, and financial condition, including liquidity.

**Instability in global economic conditions and geopolitical matters, as well as volatility in financial markets, could have a material adverse effect on our results of operations and financial condition.**

Instability in global economic conditions and geopolitical matters, as well as volatility in financial markets, could have a material adverse effect on our results of operations and financial condition. The macroeconomic environment in the United States is susceptible to global events and volatility in financial markets. For example, trade negotiations between the U.S. and other nations remain uncertain and could adversely impact economic and market conditions for the Company and its clients and counterparties. In addition, global demand for products may exceed supply during the economic recovery from the COVID-19 pandemic, and such shortages may cause prolonged inflation, adversely impact consumer and business confidence, and adversely affect the economy as well as our financial condition and results.

30 Huntington Bancshares Incorporated

### ***Operational Risks:***

**Our operational or security systems or infrastructure, or those of third parties, could fail or be breached, which could disrupt our business and adversely impact our operations, liquidity, and financial condition, as well as cause legal or reputational harm.**

The potential for operational risk exposure exists throughout our business and, as a result of our interactions with, and reliance on, third parties, is not limited to our own internal operational functions. Our operational and security systems and infrastructure, including our computer systems, data management, and internal processes, as well as those of third parties, are integral to our performance. We rely on our employees and third parties in our day-to-day and ongoing operations, who may, as a result of human error, misconduct, malfeasance, failure, or breach of our or of third-party systems or infrastructure, expose us to risk. For example, our ability to conduct business may be adversely affected by any significant disruptions to us or to third parties with whom we interact or upon whom we rely. Our financial, accounting, data processing, backup, or other operating or security systems and infrastructure may fail to operate properly or become disabled or damaged as a result of a number of factors, including events that are wholly or partially beyond our control, which could adversely affect our ability to process transactions or provide services. Such events may include: sudden increases in customer transaction volume; electrical, telecommunications, or other major physical infrastructure outages; disease pandemics; cyber-attacks; and events arising from local or larger scale political or social matters, including wars and terrorist attacks. Additional events beyond our control that could impact our business directly or indirectly include natural disasters such as earthquakes and weather events, including tornadoes, hurricanes, and floods. Neither the occurrence nor the potential impact of these events can be predicted, and the frequency and severity of weather events may be impacted by climate changes. In addition, we may need to take our systems off-line if they become infected with malware or a computer virus or as a result of another form of cyber-attack. In the event that backup systems are utilized, they may not process data as quickly as our primary systems and some data might not have been saved to backup systems, potentially resulting in a temporary or permanent loss of such data. In addition, our ability to implement backup systems and other safeguards with respect to third-party systems is more limited than with respect to our own systems. We frequently update our systems to support our operations and growth and to remain compliant with applicable laws, rules, and regulations. This updating entails significant costs and creates risks associated with implementing new systems and integrating them with existing ones, including business interruptions. Implementation and testing of controls related to our computer systems, security monitoring, and retaining and training personnel required to operate our systems also entail significant costs. Operational risk exposures could adversely impact our operations, liquidity, and financial condition, as well as cause reputational harm. In addition, we may not have adequate insurance coverage to compensate for losses from a major interruption.

**We face security risks, including denial of service attacks, hacking, social engineering attacks targeting our colleagues and customers, malware intrusion or data corruption attempts, and identity theft that could result in the disclosure of confidential information, adversely affect our business or reputation, and create significant legal and financial exposure.**

Our computer systems and network infrastructure and those of third parties, on which we are highly dependent, are subject to security risks and could be susceptible to cyber-attacks, such as denial of service attacks, hacking, terrorist activities, or identity theft. Our business relies on the secure processing, transmission, storage, and retrieval of confidential, proprietary, and other information in our computer and data management systems and networks, and in the computer and data management systems and networks of third parties. In addition, to access our network, products, and services, our customers and other third parties may use personal mobile devices or computing devices that are outside of our network environment and are subject to their own cybersecurity risks.

2022 Form 10-K 31

We, our customers, regulators, and other third parties, including other financial services institutions and companies engaged in data processing, have been subject to, and are likely to continue to be the target of, cyber-attacks. These cyber-attacks include computer viruses, malicious or destructive code, phishing attacks, denial of service or information, ransomware, improper access by employees or vendors, attacks on personal email of employees, ransom demands to not expose security vulnerabilities in our systems or the systems of third parties or other security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss, or destruction of confidential, proprietary, and other information of ours, our employees, our customers, or of third parties, damage our systems or otherwise materially disrupt our or our customers' or other third parties' network access or business operations. As cyber-threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities or incidents. Despite efforts to ensure the integrity of our systems and implement controls, processes, policies, and other protective measures, we may not be able to anticipate all security breaches, nor may we be able to implement sufficient preventive measures against such security breaches, which may result in material losses or consequences for us.

Cybersecurity risks for banking organizations have significantly increased in recent years in part because of the proliferation of new technologies, and the use of the internet and telecommunications technologies to conduct financial transactions. For example, cybersecurity risks may increase in the future as we continue to increase our mobile-payment and other internet-based product offerings and expand our internal usage of web-based products and applications. In addition, cybersecurity risks have significantly increased in recent years in part due to the increased sophistication and activities of organized crime affiliates, terrorist organizations, hostile foreign governments, disgruntled employees or vendors, activists, and other external parties, including those involved in corporate espionage. Even the most advanced internal control environment may be vulnerable to compromise. Due to increasing geopolitical tensions, nation state cyber-attacks and ransomware are both increasing in sophistication and prevalence. Targeted social engineering and email attacks (i.e., 'spear phishing' attacks) are becoming more sophisticated and are extremely difficult to prevent. In such an attack, an attacker will attempt to fraudulently induce colleagues, customers, or other users of our systems to disclose sensitive information in order to gain access to our data or that of our clients. Persistent attackers may succeed in penetrating defenses given enough resources, time, and motive. The techniques used by cyber criminals change frequently, may not be recognized until launched, and may not be recognized until well after a breach has occurred. The speed at which new vulnerabilities are discovered and exploited often before security patches are published continues to rise. Remote work further increases the risk that we may experience cyber incidents as a result of our employees, vendors, and other third parties with which we interact working remotely on less secure systems and environments.

The risk of a security breach caused by a cyber-attack at a vendor or by unauthorized vendor access has also increased in recent years. Additionally, the existence of cyber-attacks or security breaches at third-party vendors with access to our data may not be disclosed to us in a timely manner. Further, our ability to monitor our vendors' cybersecurity practices is limited. Although we generally have agreements relating to cybersecurity and data privacy in place with our vendors, we cannot guarantee that such agreements will prevent a cyber-incident impacting our systems or information or enable us to obtain adequate or any reimbursement from our service providers in the event we should suffer any such incidents. Due to applicable laws and regulations or contractual obligations, we may be held responsible for cyber-incidents attributed to our vendors as they relate to the information we share with them.

We also face indirect technology, cybersecurity, and operational risks relating to the customers, clients, and other third parties with whom we do business or upon whom we rely to facilitate or enable our business activities, including, for example, financial counterparties, regulators, and providers of critical infrastructure such as internet access and electrical power. As a result of increasing consolidation, interdependence, and complexity of financial entities and technology systems, a technology failure, cyber-attack, or other information or security breach that significantly degrades, deletes, or compromises the systems or data of one or more financial entities could have a material impact on counterparties or other market participants, including us. This consolidation, interconnectivity, and complexity increases the risk of operational failure. Any third-party technology failure, cyber-attack, or other information or security breach, termination, or constraint could, among other things, adversely affect our ability to effect transactions, service our clients, manage our exposure to risk, or expand our business.

32 Huntington Bancshares Incorporated

Cyber-attacks or other information or security breaches, whether directed at us or third parties, may result in a material loss or have material consequences. Furthermore, the public perception that a cyber-attack on our systems has been successful, whether or not this perception is correct, may damage our reputation with customers and third parties with whom we do business. Hacking of personal information and identity theft risks, in particular, could cause serious reputational harm. A successful penetration or circumvention of system security could cause us serious negative consequences, including our loss of customers and business opportunities, costs associated with maintaining business relationships after an attack or breach; significant business disruption to our operations and business, misappropriation, exposure, or destruction of our confidential information, intellectual property, funds, and/or those of our customers; or damage to our or our customers' and/or third parties' computers or systems, and could result in a violation of applicable privacy laws and other laws, litigation exposure, regulatory fines, penalties or intervention, loss of confidence in our security measures, reputational damage, reimbursement or other compensatory costs, additional compliance costs, and could adversely impact our results of operations, liquidity and financial condition. In addition, we may not have adequate insurance coverage to compensate for losses from a cybersecurity event.

### **Cybersecurity and data privacy are areas of heightened legislative and regulatory focus.**

As cybersecurity and data privacy risks for banking organizations and the broader financial system have significantly increased in recent years, cybersecurity and data privacy issues have become the subject of increasing legislative and regulatory focus. The federal bank regulatory agencies have proposed regulations that would enhance cyber risk management standards, which would apply to a wide range of large financial institutions and their third-party service providers, including us and the Bank, and would focus on cyber risk governance and management, management of internal and external dependencies, and incident response, cyber resilience, and situational awareness. Several states have also proposed or adopted cybersecurity legislation and regulations, which require, among other things, notification to affected individuals when there has been a security breach of their personal data. For more information regarding cybersecurity and data privacy, refer to Item 1: Business - 'Regulatory Matters.'

We receive, maintain, and store non-public personal information of our customers and counterparties, including, but not limited to, personally identifiable information and personal financial information. The sharing, use, disclosure, and protection of these types of information are governed by federal and state law. Both personally identifiable information and personal financial information are increasingly subject to legislation and regulation, the intent of which is to protect the privacy of personal information and personal financial information that is collected and handled. For example, in June of 2018, the Governor of California signed into law the CCPA. The CCPA, which became effective on January 1, 2020, applies to for-profit businesses that conduct business in California and meet certain revenue or data collection thresholds. Numerous other states have also enacted or are in the process of enacting state-level privacy, data protection and/or data security laws and regulations. For more information regarding data privacy laws and regulations, refer to Item 1: Business - 'Regulatory Matters.'

Further, we make public statements about our use, collection, disclosure, and other processing of personal information through our privacy policies, information provided on our website and press statements. Although we endeavor to comply with our public statements and documentation, we may at times fail to do so or be alleged to have failed to do so. The publication of our privacy policies and other statements that provide promises and assurances about privacy, data protection, and data security can subject us to potential government or legal action if they are found to be deceptive, unfair, or misrepresentative of our actual practices.

We may become subject to new legislation or regulation concerning cybersecurity or the privacy of personally identifiable information and personal financial information or of any other information we may store or maintain. We could be adversely affected if new legislation or regulations are adopted or if existing legislation or regulations are modified such that we are required to alter our systems or require changes to our business practices or privacy policies. If cybersecurity, data privacy, data protection, data transfer, or data retention laws are implemented, interpreted, or applied in a manner inconsistent with our current practices, we may be subject to fines, litigation, or regulatory enforcement actions or ordered to change our business practices, policies, or systems in a manner that adversely impacts our operating results.

2022 Form 10-K 33

# **We face significant operational risks which could lead to financial loss, expensive litigation, and loss of confidence by our customers, regulators, and capital markets.**

We are exposed to many types of operational risks, including the risk of fraud or theft by colleagues or outsiders, unauthorized transactions by colleagues or outsiders, operational errors by colleagues, business disruption, and system failures. Huntington executes against a significant number of controls, a large percent of which are manual and dependent on adequate execution by colleagues and third-party service providers. There is inherent risk that unknown single points of failure through the execution chain could give rise to material loss through inadvertent errors or malicious attack. These operational risks could lead to financial loss, expensive litigation, and loss of confidence by our customers, regulators, and the capital markets.

Moreover, negative public opinion can result from our actual or alleged conduct in any number of activities, including clients, products, and business practices; corporate governance; acquisitions; and from actions taken by government regulators and community organizations in response to those activities. Negative public opinion can adversely affect our ability to attract and retain customers and can also expose us to litigation and regulatory action.

Relative to acquisitions, we incur risks and challenges associated with the integration of employees, accounting systems, and technology platforms from acquired businesses and institutions in a timely and efficient manner, and we cannot guarantee that we will be successful in retaining existing customer relationships or achieving anticipated operating efficiencies expected from such acquisitions. Acquisitions may be subject to the receipt of approvals from certain governmental authorities, including the Federal Reserve, the OCC, and the United States Department of Justice, as well as the approval of our shareholders and the shareholders of companies that we seek to acquire. These approvals for acquisitions may not be received, may take longer than expected, or may impose conditions that are not presently anticipated or that could have an adverse effect on the combined company following the acquisitions. Subject to requisite regulatory approvals, future business acquisitions may result in the issuance and payment of additional shares of stock, which would dilute current shareholders' ownership interests. Additionally, acquisitions may involve the payment of a premium over book and market values. Therefore, dilution of our tangible book value and net income per common share could occur in connection with any future transaction.

# **Failure to maintain effective internal controls over financial reporting could impair our ability to accurately and timely report our financial results or prevent fraud, resulting in loss of investor confidence and adversely affecting our business and our stock price.**

Effective internal controls over financial reporting are necessary to provide reliable financial reports and prevent fraud. We are subject to regulation that focuses on effective internal controls and procedures. Such controls and procedures are modified, supplemented, and changed from time-to-time as necessitated by our growth and in reaction to external events and developments. Any failure to maintain an effective internal control environment could impact our ability to report our financial results on an accurate and timely basis, which could result in regulatory actions, loss of investor confidence, and an adverse impact on our business and our stock price.

# **We rely on quantitative models to measure risks and to estimate certain financial values.**

Quantitative models may be used to help manage certain aspects of our business and to assist with certain business decisions, including estimating expected lifetime credit losses, measuring the fair value of financial instruments when reliable market prices are unavailable, estimating the effects of changing interest rates and other market measures on our financial condition and results of operations, managing risk, and for capital planning purposes (including during the CCAR capital planning and capital adequacy process). Our measurement methodologies rely on many assumptions, historical analyses, and correlations. These assumptions may not capture or fully incorporate conditions leading to losses, particularly in times of market distress, and the historical correlations on which we rely may no longer be relevant. Additionally, as businesses and markets evolve, our measurements may not accurately reflect this evolution. Even if the underlying assumptions and historical correlations used in our models are adequate, our models may be deficient due to errors in computer code, inaccurate data, misuse of data, or the use of a model for a purpose outside the scope of the model's design.

34 Huntington Bancshares Incorporated

All models have certain limitations. Reliance on models presents the risk that our business decisions based on information incorporated from models will be adversely affected due to incorrect, missing, or misleading information. In addition, our models may not capture or fully express the risks we face, may suggest that we have sufficient capitalization when we do not, or may lead us to misjudge the business and economic environment in which we will operate. If our models fail to produce reliable results on an ongoing basis, we may not make appropriate risk management, capital planning, or other business or financial decisions. Strategies that we employ to manage and govern the risks associated with our use of models may not be effective or fully reliable. Also, information that we provide to the public or regulators based on poorly designed models could be inaccurate or misleading.

Banking regulators continue to focus on the models used by banks and bank holding companies in their businesses. Some of our decisions that the regulators evaluate, including distributions to our shareholders, could be affected adversely due to their perception that the quality of the models used to generate the relevant information are insufficient.

#### **We rely on third parties to provide key components of our business infrastructure.**

We rely on third-party service providers to leverage subject matter expertise and industry best practice, provide enhanced products and services, and reduce costs. Although there are benefits in entering into third-party relationships with vendors and others, there are risks associated with such activities. When entering a third-party relationship, the risks associated with that activity are not passed to the third-party but remain our responsibility. The Technology Committee of the board of directors provides oversight related to the overall risk management process associated with third-party relationships. Management is accountable for the review and evaluation of all new and existing third-party relationships. Management is responsible for ensuring that adequate controls are in place to protect us and our customers from the risks associated with vendor relationships.

Increased risk could occur based on poor planning, oversight, control, and inferior performance or service on the part of the third-party and may result in legal costs or loss of business. While we have implemented a vendor management program to actively manage the risks associated with the use of third-party service providers, any problems caused by third-party service providers could adversely affect our ability to deliver products and services to our customers and to conduct our business. Replacing a third-party service provider could also take a long period of time and result in increased expenses.

#### **Changes in accounting policies, standards, and interpretations could affect how we report our financial condition and results of operations.**

The FASB, regulatory agencies, and other bodies that establish accounting standards periodically change the financial accounting and reporting standards governing the preparation of our financial statements. Additionally, those bodies that establish and interpret the accounting standards (such as the FASB, SEC, and banking regulators) may change prior interpretations or positions on how these standards should be applied.

For further discussion, see Note 2 - 'Accounting Standards Update' to the Consolidated Financial Statements.

2022 Form 10-K 35

# **Impairment of goodwill could require charges to earnings, which could result in a negative impact on our results of operations.**

Our goodwill could become impaired in the future. If goodwill were to become impaired, it could limit the ability of the Bank to pay dividends to Huntington, adversely impacting Huntington liquidity and ability to pay dividends or repay debt. Assumptions affecting our goodwill impairment evaluation include earnings projections, the discount rates used in the income approach to measure fair value, and observed peer multiples used in estimating the fair value under the market approach. We are required to test goodwill for impairment at least annually or when impairment indicators are present. If an impairment determination is made in a future reporting period, our earnings and book value of goodwill will be reduced by the amount of the impairment. If an impairment loss is recorded, it will have little or no impact on the tangible book value of our Common Stock, or our regulatory capital levels, but such an impairment loss could significantly reduce the Bank’s earnings and thereby restrict the Bank’s ability to make dividend payments to us without prior regulatory approval, because Federal Reserve policy states the bank holding company dividends should be paid from current earnings. At December 31, 2022, the book value of our goodwill was $5.6 billion, substantially all of which was recorded at the Bank. Any such write down of goodwill or other acquisition related intangibles will reduce Huntington’s earnings, as well.

# **Climate change manifesting as physical or transition risks could adversely affect our operations, businesses, and customers.**

There is an increasing concern over the risks of climate change and related environmental sustainability matters. The physical risks of climate change include discrete events, such as flooding and wildfires, and longer-term shifts in climate patterns, such as extreme heat, sea level rise, and more frequent and prolonged drought. Under medium or longer-term scenarios, such events, if uninterrupted or unaddressed, could disrupt our operations or those of our customers or third parties on which we rely, including through direct damage to assets and indirect impacts from supply chain disruption and market volatility. Additionally, transitioning to a low-carbon economy may entail extensive policy, legal, technology and market initiatives. Transition risks, including changes in consumer preferences and additional regulatory requirements or supervisory expectations or taxes, could increase our expenses and undermine our strategies. In addition, our reputation and client relationships may be damaged as a result of our practices related to climate change, including our involvement, or our customers’ involvement, in certain industries or projects, in the absence of mitigation and/or transition measures, associated with causing or exacerbating climate change, as well as any decisions we make to continue to conduct or change our activities in response to considerations relating to climate change. As climate risk is interconnected with all key risk types, we have established a formal climate risk program to embed climate risk considerations into our risk management processes across all established risk pillars, such as market, credit, and operational risks. While the timing and severity of climate change may not be entirely predictable and our risk management processes may not be effective in mitigating climate risk exposure, we continue to build capabilities to identify, assess, and manage climate risks.

# **The effects of COVID-19 have adversely impacted our operations and financial performance, and it, or a similar health crisis or pandemic, could have similar adverse impacts in future periods.**

Although U.S. and global economies have begun to recover from the COVID-19 pandemic as many health and safety restrictions have been lifted and vaccine distribution has increased, certain adverse consequences of the pandemic, including labor shortages, disruptions of global supply chains, and inflationary pressures, continue to impact the macroeconomic environment and could adversely affect our business.

The pandemic has caused us, and could continue to cause us, to recognize credit losses in our loan portfolios and increases in our allowance for credit losses should the effects of the pandemic continue for an extended period of time or worsen. Furthermore, the pandemic could cause us to recognize impairment of our goodwill and our financial assets. Sustained adverse effects may also increase our cost of capital, prevent us from satisfying our minimum regulatory capital ratios and other supervisory requirements, or result in downgrades in our credit ratings.

36 Huntington Bancshares Incorporated

The COVID-19 pandemic has resulted in heightened operational risks. Many of our colleagues continue to work remotely at least on a part-time basis, which may create additional cybersecurity risk and opportunities for cybercriminals to exploit vulnerabilities. Cybercriminals have increased their attempts to compromise business emails, including an increase in phishing attempts, and fraudulent vendors or other parties may view the pandemic as an opportunity to prey upon consumers and businesses during this time. The increase in online and remote banking activities may also increase the risk of fraud in certain instances.

### ***Compliance Risks:***

**We operate in a highly regulated industry, and the laws and regulations that govern our operations, corporate governance, executive compensation and financial accounting, or reporting, including changes in them, or our failure to comply with them, may adversely affect us.**

The banking industry is highly regulated. We are subject to supervision, regulation, and examination by various federal and state regulators, including the Federal Reserve, OCC, SEC, CFPB, FDIC, FINRA, and various state regulatory agencies. The statutory and regulatory framework that governs us is generally intended to protect depositors and customers, the DIF, the U.S. banking and financial system, and financial markets as a whole - not to protect shareholders. These laws and regulations, among other matters, prescribe minimum capital requirements, impose limitations on our business activities (including foreclosure and collection practices), limit the dividend or distributions that we can pay, restrict the ability of institutions to guarantee our debt, and impose certain specific accounting requirements that may be more restrictive and may result in greater or earlier charges to earnings or reductions in our capital than accounting principles generally accepted in the United States. Compliance with laws and regulations can be difficult and costly, and changes to laws and regulations often impose additional compliance costs. Such regulation and supervision may increase our costs and limit our ability to pursue business opportunities. Further, our failure to comply with these laws and regulations, even if the failure was inadvertent or reflects a difference in interpretation, could subject us to restrictions on our business activities, fines, and other penalties, any of which could adversely affect our results of operations, capital base, and the price of our securities. Further, any new laws, rules, and regulations could make compliance more difficult or expensive or otherwise adversely affect our business and financial condition.

**Legislative and regulatory actions taken now or in the future that impact the financial industry may materially adversely affect us by increasing our costs, adding complexity in doing business, impeding the efficiency of our internal business processes, negatively impacting the recoverability of certain of our recorded assets, requiring us to increase our regulatory capital, limiting our ability to pursue business opportunities, and otherwise resulting in a material adverse impact on our financial condition, results of operation, liquidity, or stock price.**

Both the scope of the laws and regulations and the intensity of the supervision to which we are subject increased in response to the financial crisis, as well as other factors such as technological and market changes. Regulatory enforcement and fines have also increased across the banking and financial services sector. Compliance with these laws and regulations have resulted in and will continue to result in additional costs, which could be significant, and may have a material and adverse effect on our results of operations. In addition, if we do not appropriately comply with current or future legislation and regulations, especially those that apply to our consumer operations, which has been an area of heightened focus, we may be subject to fines, penalties or judgments, or material regulatory restrictions on our businesses, which could adversely affect operations and, in turn, financial results.

We expect the current administration will continue to implement a regulatory reform agenda that is significantly different than that of the former administration. This reform agenda could include a heightened focus on consumer protection, fair lending, the regulation of loan portfolios and credit concentrations to borrowers impacted by climate change, heightened scrutiny on Bank Secrecy Act and AML requirements, topics related to social equity, executive compensation, and increased capital and liquidity, as well as limits on share buybacks and dividends. In addition, mergers and acquisitions could be dampened by increased antitrust scrutiny. We also expect reform proposals for the short-term wholesale markets. It is too early for us to assess the extent to which these policies would be implemented and what their impact on our business will be.

2022 Form 10-K 37

# **The resolution of significant pending litigation, if unfavorable, could have an adverse effect on our results of operations for a particular period.**

We face legal risks in our businesses, and the volume of claims and amount of damages and penalties claimed in litigation and regulatory proceedings against financial institutions remain high. Substantial legal liability against us could have material adverse financial effects or cause significant reputational harm to us, which in turn could seriously harm our business prospects. It is possible that the ultimate resolution of these matters, if unfavorable, may be material to the results of operations for a particular reporting period.

For more information on litigation risks, see Note 22 - “Commitments and Contingent Liabilities” to the Consolidated Financial Statements.

# **Noncompliance with the Bank Secrecy Act and other anti-money laundering statutes and regulations could cause us material financial loss.**

The Bank Secrecy Act and the Patriot Act contain anti-money laundering and financial transparency provisions intended to detect and prevent the use of the U.S. financial system for money laundering and terrorist financing activities. The Bank Secrecy Act, as amended by the Patriot Act, requires depository institutions and their holding companies to undertake activities including maintaining an anti-money laundering program, verifying the identity of clients, monitoring for and reporting suspicious transactions, reporting on cash transactions exceeding specified thresholds, and responding to requests for information by regulatory authorities and law enforcement agencies. FinCEN, a unit of the Treasury Department that administers the Bank Secrecy Act, is authorized to impose significant civil money penalties for violations of those requirements and has recently engaged in coordinated enforcement efforts with the federal bank regulatory agencies, as well as the United States Department of Justice, Drug Enforcement Administration, and IRS.

There is also increased scrutiny of compliance with the rules enforced by the OFAC. If our policies, procedures, and systems are deemed deficient or the policies, procedures, and systems of the financial institutions that we have already acquired or may acquire in the future are deficient, we would be subject to liability, including fines and regulatory actions such as restrictions on our ability to pay dividends and the necessity to obtain regulatory approvals to proceed with certain planned business activities, including acquisition plans, which would negatively impact our business, financial condition, and results of operations. Failure to maintain and implement adequate programs to combat money laundering and terrorist financing could also have serious reputational consequences for us.

For more information regarding the Bank Secrecy Act, Patriot Act, anti-money laundering requirements and OFAC-administered sanctions, refer to Item 1: Business - “Regulatory Matters.”

# ***Strategic Risk:***

# **We operate in a highly competitive industry which depends on our ability to successfully execute our strategic plan and adapt our products and services to evolving industry standards and consumer preferences.**

We are subject to intense competition from both other financial institutions and from non-bank entities, including FinTech companies. Technology has lowered the barriers to entry, with customers having a growing variety of traditional and nontraditional alternatives, including crowdfunding, digital wallets, and money transfer services. The continuous widespread adoption of new technologies, including internet services and mobile applications, and advanced ATM functionality, is influencing how individuals and firms conduct their financial affairs and is changing the delivery channels for financial services. Our “People-First, Digitally-Powered” strategic plan considers the implications of these changes in technology. Additionally, these changes require us to adapt our product and services, as well as our distribution of them, to evolving industry standards and customer preferences. Failure to address competitive pressures could make it more difficult for us to attract and retain customers across our businesses.

38 Huntington Bancshares Incorporated

Our success depends, in part, on our ability to successfully implement our strategic plan as well as adapt existing products and services and develop competitive new products and services demanded by our customers. The widespread adoption of technologies will continue to require substantial investments to modify or adapt existing products and services and to develop new product or services. Additionally, we may not be successful in executing our strategic plan, introducing new products or services, achieving market acceptance of new product or services, anticipating or reacting to customers changing preferences, or attracting and retaining loyal customers.

# **We depend on our executive officers and key personnel to continue the implementation of our long-term business strategy and could be harmed by the loss of their services.**

We believe that our continued growth and future success will depend in large part on the skills of our management team and our ability to motivate and retain these individuals and other key personnel. The loss of service of one or more of our executive officers or key personnel could reduce our ability to successfully implement our long-term business strategy, our business could suffer, and the value of our stock could be materially adversely affected. Leadership changes will occur from time to time, and we cannot predict whether significant resignations will occur or whether we will be able to recruit additional qualified personnel. We believe our management team possesses valuable knowledge about the banking industry and that their knowledge and relationships would be very difficult to replicate. Our success also depends on the experience of our branch managers and lending officers and on their relationships with the customers and communities they serve. The loss of these key personnel could negatively impact our banking operations. The loss of key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition, or operating results.

# **Bank regulations regarding capital and liquidity, including the CCAR assessment process and the U.S. Basel III capital and liquidity standards, could require higher levels of capital and liquidity. Among other things, these regulations could impact our ability to pay common stock dividends, repurchase common stock, attract cost-effective sources of deposits, or require the retention of higher amounts of low yielding securities.**

The Federal Reserve administers CCAR, a periodic forward-looking quantitative assessment of Huntington’s capital adequacy and planned capital distributions and a review of the strength of Huntington’s practices to assess capital needs. The Federal Reserve makes a quantitative assessment of capital based on supervisory-run stress tests that assess the ability to maintain capital levels above each minimum regulatory capital ratio after making all capital actions included in Huntington’s capital plan, under baseline and stressful conditions throughout a nine-quarter planning horizon. The CCAR process is also used to determine Huntington’s SCB requirement. There can be no assurance that the Federal Reserve or OCC will respond favorably to our capital plans, planned capital actions, or stress test results, and the Federal Reserve, OCC, or other regulatory capital requirements may limit or otherwise restrict how we utilize our capital, including common stock dividends and stock repurchases.

We are also required to maintain minimum capital ratios and the Federal Reserve and OCC may determine that Huntington and/or the Bank, based on size, complexity, or risk profile, must maintain capital ratios above these minimums in order to operate in a safe and sound manner. In the event we are required to raise capital to maintain required minimum capital and leverage ratios or ratios above the required applicable minimums, we may be forced to do so when market conditions are undesirable or on terms that are less favorable to us than we would otherwise require. Furthermore, in order to prevent becoming subject to restrictions on our ability to distribute capital or make certain discretionary bonus payments to management, the Bank must maintain a CCB of 2.5%, and Huntington must maintain the applicable SCB determined as part of the CCAR process, which are in addition to our required minimum capital ratios.

For more information regarding CCAR, stress testing, and capital and liquidity requirements, refer to Item 1: Business - “Regulatory Matters.”

2022 Form 10-K 39

**If our regulators deem it appropriate, they can take regulatory actions that could result in a material adverse impact on our financial results, ability to compete for new business, or preclude mergers or acquisitions. In addition, regulatory actions could constrain our ability to fund our liquidity needs or pay dividends. Any of these actions could increase the cost of our services.**

We are subject to the supervision and regulation of various state and federal regulators, including the OCC, Federal Reserve, FDIC, SEC, CFPB, FINRA, and various state regulatory agencies. As such, we are subject to a wide variety of laws and regulations, many of which are discussed in Item 1: Business - 'Regulatory Matters.' As part of their supervisory process, which includes periodic examinations and continuous monitoring, the regulators have the authority to impose restrictions or conditions on our activities and the manner in which we manage the organization. Such actions could negatively impact us in a variety of ways, including charging monetary fines, impacting our ability to pay dividends, precluding mergers or acquisitions, limiting our ability to offer certain products or services, or imposing additional capital requirements.

Under the supervision of the CFPB, our Consumer and Business Banking products and services are subject to heightened regulatory oversight and scrutiny with respect to compliance under consumer laws and regulations. We may face a greater number or wider scope of investigations, enforcement actions, and litigation in the future related to consumer practices, thereby increasing costs associated with responding to or defending such actions. Also, federal and state regulators have been increasingly focused on sales practices of branch personnel, including taking regulatory action against other financial institutions. In addition, increased regulatory inquiries and investigations, as well as any additional legislative or regulatory developments affecting our consumer businesses, and any required changes to our business operations resulting from these developments, could result in significant loss of revenue, require remuneration to our customers, trigger fines or penalties, limit the products or services we offer, require us to increase our prices and, therefore, reduce demand for our products, impose additional compliance costs on us, increase the cost of collection, cause harm to our reputation, or otherwise adversely affect our consumer businesses.

In addition, we are allowed to conduct certain activities that are financial in nature by virtue of Huntington's status as an FHC, as discussed in more detail in Item 1. Regulatory Matters. If Huntington or the Bank cease to meet the requirements necessary for Huntington to continue to qualify as an FHC, the Federal Reserve may impose upon us corrective capital and managerial requirements, and may place limitations on our ability to conduct all of the business activities that we conduct as an FHC. If the failure to meet these standards persists, we could be required to divest our Bank, or cease all activities other than those activities that may be conducted by a BHC but not an FHC.

### ***Reputation Risk:***

**Damage to our reputation could significantly harm our business, including our competitive position and business prospects.**

Our ability to attract and retain customers, clients, investors, and employees is affected by our reputation. Significant harm to our reputation can arise from various sources, including officer, director, or employee misconduct, actual or perceived unethical behavior, conflicts of interest, security breaches, litigation or regulatory outcomes, compensation practices, failing to deliver minimum or required standards of service and quality, failing to address customer and agency complaints, compliance failures, unauthorized release of personal, proprietary or confidential information due to cyber-attacks or otherwise, perception of our environmental, social, and governance practices and disclosures, and the activities of our clients, customers, and counterparties, including vendors. Actions by the financial service industry generally or by institutions or individuals in the industry can adversely affect our reputation indirectly by association. In addition, adverse publicity or negative information posted on social media, whether or not factually correct, may affect our business prospects. All of these could adversely affect our growth, results of operation, and financial condition.

### **Item 1B: Unresolved Staff Comments**

None.

40 Huntington Bancshares Incorporated

## **Item 2: Properties**

Our headquarters, as well as the Bank's, is located in the Huntington Center, a thirty-seven story office building located in Columbus, Ohio. Of the building's total office space available, we lease approximately 22%. The lease term expires in 2030, with six five-year renewal options for up to 30 years but with no purchase option. The Bank has an indirect minority equity interest of 18% in the building. Our commercial headquarters is located in the Detroit Tower, a twenty story office building, located in Detroit, Michigan. We lease the entirety of the building's total office space available. The lease term expires in 2044, with four seven-year renewal options for up to 28 years with no purchase option. The Bank has no ownership interest in the building.

We own or lease numerous other premises for use in conducting business activities, including operations centers, offices, and branches and other facilities. We consider the facilities owned or occupied under lease by our subsidiaries to be adequate for the purposes of our business operations. Additional information regarding our properties is set forth in Note 9 - 'Premises and Equipment' and Note 10 - 'Operating Leases' of the Notes to Consolidated Financial Statements and is incorporated into this item by reference.

## **Item 3: Legal Proceedings**

Information required by this item is set forth in Note 22 - 'Commitments and Contingent Liabilities' of the Notes to Consolidated Financial Statements under the caption 'Litigation and Regulatory Matters' and is incorporated into this Item by reference.

## **Item 4: Mine Safety Disclosures**

Not applicable.

2022 Form 10-K 41

## PART II

### Item 5: Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities

The common stock of Huntington Bancshares Incorporated is traded on the Nasdaq Global Stock Market under the symbol 'HBAN.' As of January 31, 2023, we had 30,985 shareholders of record.

Information regarding restrictions on dividends, as required by this Item, is set forth in Item 1: 'Business - Regulatory Matters' and in Note 23 - 'Other Regulatory Matters' of the Notes to Consolidated Financial Statements and incorporated into this Item by reference.

The following graph shows the changes, over the five-year period, in the value of $100 invested in (i) shares of Huntington's Common Stock; (ii) the Standard & Poor's 500 Stock Index (the S&P 500 Index) and (iii) Keefe, Bruyette & Woods Bank Index, for the period December 31, 2017, through December 31, 2022. The KBW Bank Index is a market capitalization-weighted bank stock index published by Keefe, Bruyette & Woods. The index is composed of the largest banking companies and includes all money center banks and regional banks, including Huntington. An investment of $100 on December 31, 2017, and the reinvestment of all dividends, are assumed. The plotted points represent the cumulative total return on the last trading day of the fiscal year indicated.

![img-0.jpeg](img-0.jpeg)

|  | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 |
| --- | --- | --- | --- | --- | --- | --- |
| HBAN | $100 | $85 | $111 | $99 | $126 | $120 |
| S&P 500 | 100 | 95 | 125 | 148 | 190 | 155 |
| KBW Bank Index | 100 | 82 | 112 | 100 | 138 | 109 |

For information regarding securities authorized for issuance under Huntington's equity compensation plans, see Part III, Item 12.

### Item 6:

[Reserved]

42 Huntington Bancshares Incorporated

# Item 7: Management's Discussion and Analysis of Financial Condition and Results of Operations

## INTRODUCTION

This MD&A provides information we believe necessary for understanding our financial condition, changes in financial condition, results of operations, and cash flows. The MD&A should be read in conjunction with the Consolidated Financial Statements, Notes to Consolidated Financial Statements, and other information contained in this report. The forward-looking statements in this section and other parts of this report involve assumptions, risks, uncertainties, and other factors, including statements regarding our plans, objectives, goals, strategies, and financial performance. Our actual results could differ materially from the results anticipated in these forward-looking statements as a result of factors set forth under the caption 'Forward-Looking Statements' and those set forth in Item 1A.

## EXECUTIVE OVERVIEW

### Acquisitions

In June 2021, Huntington closed the acquisition of TCF Financial Corporation. Historical periods prior to June 9, 2021 reflect results of legacy Huntington operations. Subsequent to closing, results reflect all post-acquisition activity. For further information, refer to Note 3 'Business Combinations' of the Notes to Consolidated Financial Statements.

In May 2022, Huntington completed the acquisition of Torana, now known as Huntington Choice Pay, a digital payments business focused on business to consumer payments. This acquisition, along with the formation of our enterprise-wide payments group, reflects one of our strategic priorities to accelerate our payments capabilities and expand the services provided to our customers.

In June 2022, Huntington completed the acquisition of Capstone Partners, a top tier middle market investment bank and advisory firm. The transaction brings a national scale to serve middle market business owners throughout the corporate lifecycle, building on Huntington's regional banking foundation. Capstone Partners related revenue, including mergers and acquisitions, capital raising and other advisory-related fees, is recognized within capital markets fees in the Consolidated Statements of Income. For further information, refer to Note 3 'Business Combinations' of the Notes to Consolidated Financial Statements.

### 2022 Financial Performance Review

In 2022, we reported net income of $2.2 billion, a $943 million, or 73%, increase from the prior year. Earnings per common share on a diluted basis for the year were $1.45, up 61% from the prior year. The current year reported net income was negatively impacted by acquisition-related expenses totaling $95 million, or $76 million after tax ($0.05 per common share), compared to $701 million, or $566 million after tax ($0.44 per common share) in the prior year.

Net interest income for 2022 was $5.3 billion, up $1.2 billion, or 29%, from 2021. FTE net interest income, a non-GAAP financial measure, increased $1.2 billion, or 29%, from 2021. The increase in FTE net interest income reflected the benefit of a $23.3 billion, or 17%, increase in average earning assets in addition to a 30 basis point increase in the FTE NIM to 3.25%. Average earning asset growth included an $18.4 billion, or 19%, increase in average loans and leases and an $8.9 billion, or 27%, increase in average securities. Average balances across earning asset categories reflect organic growth in addition to the late second-quarter 2021 TCF acquisition. The increase in average securities was additionally driven by the redeployment of excess liquidity into securities in the second half of 2021. The NIM expansion was driven by the higher rate environment driving an increase in loan and lease and investment security yields, partially offset by higher cost of funds and the impact of lower accelerated PPP loan fees recognized upon forgiveness payments from the SBA in 2022.

The provision for credit losses increased $264 million to $289 million, primarily due to loan and lease growth and the likelihood of a worsening economic scenario throughout 2022. The reduction in ACL coverage ratios over the course of 2021 reflected more clarity relating to the economic impacts of COVID-19. The ACL was $2.3 billion, or 1.90% of total loans and leases, at December 31, 2022, compared to $2.1 billion, or 1.89% of total loans and leases, at December 31, 2021. The increase in the total ACL was primarily driven by loan and lease growth, but also recognizes the increased near-term recessionary risks at the end of 2022.

2022 Form 10-K 43

Noninterest income was $2.0 billion, up $92 million, or 5%, from the prior year. Noninterest expense was $4.2 billion, down $174 million, or 4%, from the prior year. The changes in noninterest income and noninterest expense were impacted by the full-period impact of the TCF acquisition, completed in June 2021, in addition to the capital markets activity associated with the Capstone Partners acquisition, completed in June 2022. Noninterest expense was additionally impacted by a decrease in acquisition-related expenses of $606 million and the execution of cost reduction initiatives associated with the TCF acquisition.

The tangible common equity to tangible assets ratio was 5.55% at December 31, 2022, down 133 basis points from December 31, 2021, primarily due to a decrease in tangible common equity related to the higher interest rates causing an increase in accumulated other comprehensive loss, partially offset by earnings. CET1 risk-based capital ratio was 9.36%, up from 9.33% at December 31, 2021. The increase in regulatory capital ratios was primarily driven by earnings.

## **Business Overview**

### ***General***

Our general business objectives are to:

- Build on our vision to be the country's leading people-first, digitally powered bank
- Drive sustainable long-term revenue growth and efficiency
- Deliver a Category of One customer experience through our distinguished brand and culture
- Extend our digital leadership with focus on ease of use, access to information, and self-service across products and services
- Leverage expertise and capabilities to acquire and deepen relationships and launching of select partnerships
- Maintain positive operating leverage and execute disciplined capital management
- Stability and resilience through risk management, maintaining an aggregate moderate-to-low, through-the-cycle risk appetite

### ***Economy***

Growth in economic activity and demand for goods and services, alongside labor shortages, supply chain complications and geopolitical matters, have contributed to rising inflation. In response, the Federal Reserve has raised interest rates and has been reducing the size of its balance sheet. Furthermore, the Federal Reserve has signaled that it would continue to implement these policy actions in order to bring inflation down. The timing and impact of inflation and rising interest rates on our business and related financial results will depend on future developments, which are highly uncertain and difficult to predict. Our businesses and financial results may be impacted by a variety of other factors as well, such as an economic slowdown or recession. Our baseline economic forecast assumes a mild recession in 2023 with modest GDP growth for the full year. We expect the economy to exit the year on the path toward recovery with inflation gradually subsiding.

We delivered positive results in 2022, driven by broad-based loan and lease growth, growth in our deposit base, higher revenue, and disciplined expense management which were marked by the execution of strategic initiatives and acquisition synergies to further expand our capabilities. The addition of Capstone Partners has expanded the expertise we bring to customers, is benefiting our continued efforts to deepen relationships with commercial customers, and is increasing our fee income opportunities. Credit continues to perform well in keeping with our aggregate moderate-to-low, through-the-cycle risk appetite. With our disciplined and proactive approach, we believe Huntington is well positioned to manage through the uncertain economic outlook on the horizon. We remain focused on delivering profitable growth and driving value for our shareholders.

### ***Legislative and Regulatory***

A comprehensive discussion of legislative and regulatory matters affecting us can be found in Item 1: Business - "Regulatory Matters" section of this Form 10-K.

44 Huntington Bancshares Incorporated

**Table 1 - Selected Year to Date Income Statement Data**

| (amounts in millions, except per share data) | Year Ended December 31, |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  | 2022 | Change from 2021 |  | 2021 | Change from 2020 |  | 2020 |
|  |  | Amount | Percent |  | Amount | Percent |  |
| Interest income | $5,969 | $1,778 | 42% | $4,191 | $544 | 15% | $3,647 |
| Interest expense | 696 | 607 | NM | 89 | (334) | (79) | 423 |
| Net interest income | 5,273 | 1,171 | 29 | 4,102 | 878 | 27 | 3,224 |
| Provision for credit losses | 289 | 264 | NM | 25 | (1,023) | (98) | 1,048 |
| Net interest income after provision for credit losses | 4,984 | 907 | 22 | 4,077 | 1,901 | 87 | 2,176 |
| Service charges on deposit accounts | 384 | 12 | 3 | 372 | 71 | 24 | 301 |
| Card and payment processing income | 374 | 40 | 12 | 334 | 86 | 35 | 248 |
| Capital markets fees | 252 | 101 | 67 | 151 | 26 | 21 | 125 |
| Trust and investment management services | 249 | 17 | 7 | 232 | 43 | 23 | 189 |
| Mortgage banking income | 144 | (165) | (53) | 309 | (57) | (16) | 366 |
| Leasing revenue | 126 | 27 | 27 | 99 | 78 | NM | 21 |
| Insurance income | 117 | 12 | 11 | 105 | 8 | 8 | 97 |
| Gain on sale of loans | 57 | 48 | NM | 9 | (33) | (79) | 42 |
| Bank owned life insurance income | 56 | (13) | (19) | 69 | 5 | 8 | 64 |
| Net gains (losses) on sales of securities | - | (9) | NM | 9 | 10 | NM | (1) |
| Other noninterest income | 222 | 22 | 11 | 200 | 61 | 44 | 139 |
| Total noninterest income | 1,981 | 92 | 5 | 1,889 | 298 | 19 | 1,591 |
| Personnel costs | 2,401 | 66 | 3 | 2,335 | 643 | 38 | 1,692 |
| Outside data processing and other services | 610 | (240) | (28) | 850 | 466 | 121 | 384 |
| Equipment | 269 | 21 | 8 | 248 | 68 | 38 | 180 |
| Net occupancy | 246 | (31) | (11) | 277 | 119 | 75 | 158 |
| Marketing | 91 | 2 | 2 | 89 | 51 | 134 | 38 |
| Professional services | 77 | (36) | (32) | 113 | 58 | 105 | 55 |
| Deposit and other insurance expense | 67 | 16 | 31 | 51 | 19 | 59 | 32 |
| Amortization of intangibles | 53 | 5 | 10 | 48 | 7 | 17 | 41 |
| Lease financing equipment depreciation | 45 | 4 | 10 | 41 | 40 | NM | 1 |
| Other noninterest expense | 342 | 19 | 6 | 323 | 109 | 51 | 214 |
| Total noninterest expense | 4,201 | (174) | (4) | 4,375 | 1,580 | 57 | 2,795 |
| Income before income taxes | 2,764 | 1,173 | 74 | 1,591 | 619 | 64 | 972 |
| Provision for income taxes | 515 | 221 | 75 | 294 | 139 | 90 | 155 |
| Income after income taxes | 2,249 | 952 | 73 | 1,297 | 480 | 59 | 817 |
| Income attributable to non-controlling interest | 11 | 9 | NM | 2 | 2 | NM | - |
| Net income attributable to Huntington Bancshares Inc | 2,238 | 943 | 73 | 1,295 | 478 | 59 | 817 |
| Dividends on preferred shares | 113 | (18) | (14) | 131 | 31 | 31 | 100 |
| Impact of preferred stock redemption | - | (11) | NM | 11 | 11 | NM | - |
| Net income applicable to common shares | $2,125 | $972 | 84% | $1,153 | $436 | 61% | $717 |
| Average common shares-basic | 1,441 | 179 | 14% | 1,262 | 245 | 24% | 1,017 |
| Average common shares-diluted | 1,465 | 178 | 14 | 1,287 | 254 | 25 | 1,033 |
| Net income per common share-basic | $1.47 | $0.56 | 62% | $0.91 | $0.20 | 28% | $0.71 |
| Net income per common share-diluted | 1.45 | 0.55 | 61 | 0.90 | 0.21 | 30 | 0.69 |
| Cash dividends declared | 0.62 | 0.015 | 2 | 0.605 | 0.005 | 1 | 0.60 |
| Revenue and Net Interest Income-FTE (Non-GAAP) |  |  |  |  |  |  |  |
| Net interest income | $5,273 | $1,171 | 29% | $4,102 | $878 | 27% | $3,224 |
| FTE adjustment (1) | 31 | 6 | 24 | 25 | 4 | 19 | 21 |
| Net interest income, FTE (non-GAAP)(1) | 5,304 | 1,177 | 29 | 4,127 | 882 | 27 | 3,245 |
| Noninterest income | 1,981 | 92 | 5 | 1,889 | 298 | 19 | 1,591 |
| Total revenue, FTE (non-GAAP)(1) | $7,285 | $1,269 | 21% | $6,016 | $1,180 | 24% | $4,836 |

(1) On an FTE basis assuming a 21% tax rate.

2022 Form 10-K 45

## DISCUSSION OF RESULTS OF OPERATIONS

This section provides a review of financial performance on a consolidated basis. Key consolidated balance sheet and income statement trends are discussed. All earnings per share data are reported on a diluted basis. For additional insight on financial performance, please read this section in conjunction with the “Business Segment Discussion.”

For a discussion of our results of operations for 2021 versus 2020, see “Part II, Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations” Discussion of Results of Operations included in our 2021 Form 10-K, filed with the SEC on February 18, 2022.

### Average Balance Sheet / Net Interest Income

Our primary source of revenue is net interest income, which is the difference between interest income from earning assets (primarily loans, leases, and securities), and interest expense of funding sources (primarily interest-bearing deposits and borrowings). Earning asset balances and related funding sources, as well as changes in the levels of interest rates, impact net interest income. The difference between the average yield on earning assets and the average rate paid for interest-bearing liabilities is the net interest spread. Noninterest-bearing sources of funds, such as demand deposits and shareholders’ equity, also support earning assets. The impact of the noninterest-bearing sources of funds, often referred to as “free” funds, is captured in the net interest margin, which is calculated as net interest income divided by average earning assets. Both the net interest margin and net interest spread are presented on an FTE basis, which means that tax-free interest income has been adjusted to a pretax equivalent income, assuming a 21% tax rate.

The following table shows changes in fully-taxable equivalent interest income, interest expense, and net interest income due to volume and rate variances for major categories of earning assets and interest-bearing liabilities:

**Table 2 - Change in Net Interest Income Due to Changes in Average Volume and Interest Rates (1)**

| (dollar amounts in millions) FTE basis (2) | 2022 |  |  | 2021 |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  | Increase (Decrease) From Previous Year Due To |  |  | Increase (Decrease) From Previous Year Due To |  |  |
|  | Volume | Yield/ Rate | Total | Volume | Yield/ Rate | Total |
| Loans and leases | $744 | $437 | $1,181 | $659 | $(102) | $557 |
| Investment securities | 165 | 367 | 532 | 174 | (195) | (21) |
| Other earning assets | (30) | 101 | 71 | 30 | (18) | 12 |
| Total interest income from earning assets | 879 | 905 | 1,784 | 863 | (315) | 548 |
| Deposits | 11 | 307 | 318 | 46 | (199) | (153) |
| Short-term borrowings | 30 | 15 | 45 | (6) | (6) | (12) |
| Long-term debt | 8 | 236 | 244 | (38) | (131) | (169) |
| Total interest expense of interest-bearing liabilities | 49 | 558 | 607 | 2 | (336) | (334) |
| Net interest income | $830 | $347 | $1,177 | $861 | $21 | $882 |

(1) The change in interest income or expense due to both rate and volume has been allocated between the factors in proportion to the relationship of the absolute dollar amounts of the change in each.

(2) Calculated assuming a 21% tax rate.

46 Huntington Bancshares Incorporated

**Table 3 - Consolidated Average Balance Sheet and Net Interest Margin Analysis**

|  | Year ended |  |  |  |  |  | Change from 2021 |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  | 2022 |  |  | 2021 |  |  | Average Balances |  |
|  | Average Balances | Interest Income (FTE) (1) | Yield/ Rate (2) | Average Balances | Interest Income (FTE) (1) | Yield/ Rate (2) | Amount | Percent |
| (dollar amounts in millions) |  |  |  |  |  |  |  |  |
| Assets: |  |  |  |  |  |  |  |  |
| Interest-bearing deposits at Federal Reserve Bank | $4,626 | $75 | 1.63% | $8,129 | $11 | 0.14% | $(3,503) | (43)% |
| Interest-bearing deposits in banks | 226 | 8 | 3.15 | 372 | 1 | 0.04 | (146) | (39) |
| Securities: |  |  |  |  |  |  |  |  |
| Trading account securities | 32 | 1 | 4.14 | 50 | 1 | 3.32 | (18) | (36) |
| Available-for-sale securities: |  |  |  |  |  |  |  |  |
| Taxable | 21,994 | 576 | 2.62 | 19,767 | 261 | 1.32 | 2,227 | 11 |
| Tax-exempt | 2,842 | 94 | 3.32 | 2,916 | 71 | 2.42 | (74) | (3) |
| Total available-for-sale securities | 24,836 | 670 | 2.70 | 22,683 | 332 | 1.46 | 2,153 | 9 |
| Held-to-maturity securities-taxable | 16,509 | 351 | 2.13 | 10,000 | 174 | 1.74 | 6,509 | 65 |
| Other securities | 845 | 27 | 3.16 | 556 | 10 | 1.75 | 289 | 52 |
| Total securities | 42,222 | 1,049 | 2.48 | 33,289 | 517 | 1.55 | 8,933 | 27 |
| Loans held for sale | 973 | 41 | 4.24 | 1,398 | 41 | 2.96 | (425) | (30) |
| Loans and leases: (3) |  |  |  |  |  |  |  |  |
| Commercial: |  |  |  |  |  |  |  |  |
| Commercial and industrial | 43,118 | 1,875 | 4.35 | 36,898 | 1,446 | 3.92 | 6,220 | 17 |
| Commercial real estate | 15,768 | 683 | 4.33 | 11,412 | 362 | 3.17 | 4,356 | 38 |
| Lease financing | 4,974 | 251 | 5.04 | 3,739 | 186 | 4.98 | 1,235 | 33 |
| Total commercial | 63,860 | 2,809 | 4.40 | 52,049 | 1,994 | 3.83 | 11,811 | 23 |
| Consumer: |  |  |  |  |  |  |  |  |
| Residential mortgage | 20,907 | 661 | 3.16 | 15,953 | 479 | 3.00 | 4,954 | 31 |
| Automobile | 13,454 | 472 | 3.51 | 13,008 | 471 | 3.62 | 446 | 3 |
| Home equity | 10,409 | 532 | 5.11 | 10,018 | 391 | 3.90 | 391 | 4 |
| RV and marine | 5,322 | 227 | 4.26 | 4,672 | 199 | 4.27 | 650 | 14 |
| Other consumer | 1,314 | 126 | 9.51 | 1,118 | 112 | 10.04 | 196 | 18 |
| Total consumer | 51,406 | 2,018 | 3.92 | 44,769 | 1,652 | 3.69 | 6,637 | 15 |
| Total loans and leases | 115,266 | 4,827 | 4.19 | 96,818 | 3,646 | 3.77 | 18,448 | 19 |
| Total earning assets | 163,313 | 6,000 | 3.67 | 140,006 | 4,216 | 3.01 | 23,307 | 17 |
| Cash and due from banks | 1,666 |  |  | 1,356 |  |  | 310 | 23 |
| Goodwill and other intangible assets | 5,688 |  |  | 4,108 |  |  | 1,580 | 38 |
| All other assets | 10,184 |  |  | 8,804 |  |  | 1,380 | 16 |
| Allowance for loan and lease losses | (2,083) |  |  | (1,993) |  |  | (90) | (5) |
| Total assets | $178,768 |  |  | $152,281 |  |  | $26,487 | 17% |
| Liabilities and Shareholders' Equity: |  |  |  |  |  |  |  |  |
| Interest-bearing deposits: |  |  |  |  |  |  |  |  |
| Demand deposits-interest-bearing | $41,779 | $158 | 0.38% | $32,708 | $12 | 0.04% | $9,071 | 28% |
| Money market deposits | 33,733 | 112 | 0.33 | 30,039 | 21 | 0.07 | 3,694 | 12 |
| Savings and other domestic deposits | 21,316 | 5 | 0.02 | 17,357 | 5 | 0.03 | 3,959 | 23 |
| Core certificates of deposit (4) | 2,439 | 12 | 0.50 | 2,368 | 1 | 0.03 | 71 | 3 |
| Other domestic deposits of $250,000 or more | 233 | 1 | 0.47 | 353 | 1 | 0.21 | (120) | (34) |
| Negotiable CDs, brokered and other deposits | 3,838 | 75 | 1.96 | 3,525 | 5 | 0.16 | 313 | 9 |
| Total interest-bearing deposits | 103,338 | 363 | 0.35 | 86,350 | 45 | 0.05 | 16,988 | 20 |
| Short-term borrowings | 2,485 | 46 | 1.86 | 278 | 1 | 0.20 | 2,207 | NM |
| Long-term debt (5) | 8,724 | 287 | 3.29 | 7,479 | 43 | 0.57 | 1,245 | 17 |
| Total interest-bearing liabilities | 114,547 | 696 | 0.61 | 94,107 | 89 | 0.09 | 20,440 | 22 |
| Demand deposits-noninterest-bearing | 41,574 |  |  | 37,960 |  |  | 3,614 | 10 |
| All other liabilities | 4,353 |  |  | 3,205 |  |  | 1,148 | 36 |
| Total Huntington Bancshares Inc shareholders' equity | 18,263 |  |  | 16,997 |  |  | 1,266 | 7 |
| Non-controlling interest | 31 |  |  | 12 |  |  | 19 | NM |
| Total equity | 18,294 |  |  | 17,009 |  |  | 1,285 | 8 |
| Total liabilities and shareholders' equity | $178,768 |  |  | $152,281 |  |  | $26,487 | 17% |
| Net interest rate spread |  |  | 3.06 |  |  | 2.92 |  |  |
| Impact of noninterest-bearing funds on margin |  |  | 0.19 |  |  | 0.03 |  |  |
| Net interest margin/NII |  | $5,304 | 3.25% |  | $4,127 | 2.95% |  |  |

(1) FTE yields are calculated assuming a 21% tax rate.

(2) Average yield/rates include the impact of applicable derivatives. Loan and lease and deposit average yield/rates also include impact of applicable non-deferrable and amortized fees.

(3) For purposes of this analysis, NALs are reflected in the average balances of loans and leases.

(4) Includes consumer certificates of deposit of $250,000 or more.

(5) Reflects the benefit of $89 million mark-to-market of interest rate caps for 2021. There was no impact for 2022.

2022 Form 10-K 47

**Table 3 - Consolidated Average Balance Sheet and Net Interest Margin Analysis (Continued)**

|  | Year ended |  |  |  |  |  | Change from 2020 |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  | 2021 |  |  | 2020 |  |  | Average Balances |  |
|  | Average Balances | Interest Income (FTE) (1) | Yield/ Rate (2) | Average Balances | Interest Income (FTE) (1) | Yield/ Rate (2) | Amount | Percent |
| (dollar amounts in millions) |  |  |  |  |  |  |  |  |
| Assets: |  |  |  |  |  |  |  |  |
| Interest-bearing deposits at Federal Reserve Bank | $8,129 | $11 | 0.14% | $3,874 | $6 | 0.15% | $4,255 | 110% |
| Interest-bearing deposits in banks | 372 | 1 | 0.04 | 176 | 1 | 0.47 | 196 | 111 |
| Securities: |  |  |  |  |  |  |  |  |
| Trading account securities | 50 | 1 | 3.32 | 59 | 2 | 3.10 | (9) | (15) |
| Available-for-sale securities: |  |  |  |  |  |  |  |  |
| Taxable | 19,767 | 261 | 1.32 | 11,392 | 237 | 2.08 | 8,375 | 74 |
| Tax-exempt | 2,916 | 71 | 2.42 | 2,735 | 77 | 2.84 | 181 | 7 |
| Total available-for-sale securities | 22,683 | 332 | 1.46 | 14,127 | 314 | 2.23 | 8,556 | 61 |
| Held-to-maturity securities-taxable | 10,000 | 174 | 1.74 | 9,248 | 216 | 2.33 | 752 | 8 |
| Other securities | 556 | 10 | 1.75 | 443 | 6 | 1.41 | 113 | 26 |
| Total securities | 33,289 | 517 | 1.55 | 23,877 | 538 | 2.25 | 9,412 | 39 |
| Loans held for sale | 1,398 | 41 | 2.96 | 1,121 | 34 | 3.06 | 277 | 25 |
| Loans and leases: (3) |  |  |  |  |  |  |  |  |
| Commercial: |  |  |  |  |  |  |  |  |
| Commercial and industrial | 36,898 | 1,446 | 3.92 | 31,624 | 1,166 | 3.69 | 5,274 | 17 |
| Commercial real estate | 11,412 | 362 | 3.17 | 7,054 | 225 | 3.19 | 4,358 | 62 |
| Lease financing | 3,739 | 186 | 4.98 | 2,293 | 124 | 5.42 | 1,446 | 63 |
| Total commercial | 52,049 | 1,994 | 3.83 | 40,971 | 1,515 | 3.70 | 11,078 | 27 |
| Consumer: |  |  |  |  |  |  |  |  |
| Residential mortgage | 15,953 | 479 | 3.00 | 11,694 | 406 | 3.47 | 4,259 | 36 |
| Automobile | 13,008 | 471 | 3.62 | 12,838 | 504 | 3.93 | 170 | 1 |
| Home equity | 10,018 | 391 | 3.90 | 8,930 | 358 | 4.01 | 1,088 | 12 |
| RV and marine | 4,672 | 199 | 4.27 | 3,876 | 181 | 4.68 | 796 | 21 |
| Other consumer | 1,118 | 112 | 10.04 | 1,086 | 125 | 11.48 | 32 | 3 |
| Total consumer | 44,769 | 1,652 | 3.69 | 38,424 | 1,574 | 4.10 | 6,345 | 17 |
| Total loans and leases | 96,818 | 3,646 | 3.77 | 79,395 | 3,089 | 3.89 | 17,423 | 22 |
| Total earning assets | 140,006 | 4,216 | 3.01 | 108,443 | 3,668 | 3.38 | 31,563 | 29 |
| Cash and due from banks | 1,356 |  |  | 1,124 |  |  | 232 | 21 |
| Goodwill and other intangible assets | 4,108 |  |  | 2,201 |  |  | 1,907 | 87 |
| All other assets | 8,804 |  |  | 7,045 |  |  | 1,759 | 25 |
| Allowance for loan and lease losses | (1,993) |  |  | (1,581) |  |  | (412) | (26) |
| Total assets | $152,281 |  |  | $117,232 |  |  | $35,049 | 30% |
| Liabilities and Shareholders' Equity: |  |  |  |  |  |  |  |  |
| Interest-bearing deposits: |  |  |  |  |  |  |  |  |
| Demand deposits-interest-bearing | $32,708 | $12 | 0.04% | $23,514 | $32 | 0.14% | $9,194 | 39% |
| Money market deposits | 30,039 | 21 | 0.07 | 25,695 | 100 | 0.39 | 4,344 | 17 |
| Savings and other domestic deposits | 17,357 | 5 | 0.03 | 10,720 | 10 | 0.09 | 6,637 | 62 |
| Core certificates of deposit (4) | 2,368 | 1 | 0.03 | 2,610 | 38 | 1.44 | (242) | (9) |
| Other domestic deposits of $250,000 or more | 353 | 1 | 0.21 | 216 | 3 | 1.18 | 137 | 63 |
| Negotiable CDs, brokered and other deposits | 3,525 | 5 | 0.16 | 3,822 | 15 | 0.38 | (297) | (8) |
| Total interest-bearing deposits | 86,350 | 45 | 0.05 | 66,577 | 198 | 0.30 | 19,773 | 30 |
| Short-term borrowings | 278 | 1 | 0.20 | 1,147 | 13 | 1.18 | (869) | (76) |
| Long-term debt (5) | 7,479 | 43 | 0.57 | 9,496 | 212 | 2.24 | (2,017) | (21) |
| Total interest-bearing liabilities | 94,107 | 89 | 0.09 | 77,220 | 423 | 0.55 | 16,887 | 22 |
| Demand deposits-noninterest-bearing | 37,960 |  |  | 25,336 |  |  | 12,624 | 50 |
| All other liabilities | 3,205 |  |  | 2,373 |  |  | 832 | 35 |
| Total Huntington Bancshares Inc shareholders' equity | 16,997 |  |  | 12,303 |  |  | 4,694 | 38 |
| Non-controlling interest | 12 |  |  | - |  |  | 12 | 100 |
| Total equity | 17,009 |  |  | 12,303 |  |  | 4,706 | 38 |
| Total liabilities and shareholders' equity | $152,281 |  |  | $117,232 |  |  | $35,049 | 30% |
| Net interest rate spread |  |  | 2.92 |  |  | 2.83 |  |  |
| Impact of noninterest-bearing funds on margin |  |  | 0.03 |  |  | 0.16 |  |  |
| Net interest margin/NII |  | $4,127 | 2.95% |  | $3,245 | 2.99% |  |  |

(1) FTE yields are calculated assuming a 21% tax rate.

(2) Average yield/rates include the impact of applicable derivatives. Loan and lease and deposit average yield/rates also include impact of applicable non-deferrable and amortized fees.

(3) For purposes of this analysis, NALs are reflected in the average balances of loans and leases.

(4) Includes consumer certificates of deposit of $250,000 or more.

(5) Reflects the benefit of $89 million mark-to-market of interest rate caps for 2021. There was no impact for 2020.

48 Huntington Bancshares Incorporated

Net interest income for 2022 increased $1.2 billion, or 29%, from 2021. FTE net interest income, a non-GAAP financial measure, for 2022 increased $1.2 billion, or 29%, from 2021. The increase in FTE net interest income reflected the benefit of a $23.3 billion, or 17%, increase in average total earning assets in addition to a 30 basis point increase in the FTE NIM to 3.25%. The increase in average total earning assets included a $18.4 billion, or 19%, increase in average loans and leases and a $8.9 billion, or 27%, increase in average total securities. Average balance increases across earning asset categories for 2022 reflect organic growth in addition to the late second-quarter 2021 TCF acquisition. The increase in average securities was additionally driven by the redeployment of excess liquidity into securities in the second half of 2021.

The NIM expansion was driven by the higher rate environment driving an increase in loan and lease and investment security yields, partially offset by higher cost of funds and the impact of lower accelerated PPP loan fees recognized upon forgiveness payments from the SBA in 2022. Net interest income for 2022 included $21 million in accelerated PPP loan fees recognized upon forgiveness payments from the SBA, compared to $126 million in 2021.

### Provision for Credit Losses

*(This section should be read in conjunction with the “Credit Risk” section.)*

The provision for credit losses is the expense necessary to maintain the ACL at levels appropriate to absorb our estimate of credit losses expected over the life of the loan and lease portfolio, securities portfolio, and unfunded lending commitments.

The provision for credit losses in 2022 was $289 million, an increase of $264 million from 2021. The increase in provision expense over the prior year was due to a combination of loan and lease growth in 2022 and a reduction in ACL coverage ratios over the course of 2021, as there was more clarity relating to the economic impacts of COVID-19.

The components of the provision for credit losses were as follows:

**Table 4 - Provision for Credit Losses**

| (dollar amounts in millions) | Year Ended December 31, |  |  |
| --- | --- | --- | --- |
|  | 2022 | 2021 | 2020 |
| Provision for loan and lease losses | $212 | $(1) | $1,089 |
| Provision for unfunded lending commitments | 73 | 26 | (41) |
| Provision for securities | 4 | - | - |
| Total provision for credit losses | $289 | $25 | $1,048 |

2022 Form 10-K 49

## Noninterest Income

The following table reflects noninterest income for each of the periods presented:

**Table 5 - Noninterest Income**

| (dollar amounts in millions) | Year Ended December 31, |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  | 2022 | Change from 2021 |  | 2021 | Change from 2020 |  | 2020 |
|  |  | Amount | Percent |  | Amount | Percent |  |
| Service charges on deposit accounts | $384 | $12 | 3% | $372 | $71 | 24% | $301 |
| Card and payment processing income | 374 | 40 | 12 | 334 | 86 | 35 | 248 |
| Capital markets fees | 252 | 101 | 67 | 151 | 26 | 21 | 125 |
| Trust and investment management services | 249 | 17 | 7 | 232 | 43 | 23 | 189 |
| Mortgage banking income | 144 | (165) | (53) | 309 | (57) | (16) | 366 |
| Leasing revenue | 126 | 27 | 27 | 99 | 78 | NM | 21 |
| Insurance income | 117 | 12 | 11 | 105 | 8 | 8 | 97 |
| Gain on sale of loans | 57 | 48 | NM | 9 | (33) | (79) | 42 |
| Bank owned life insurance income | 56 | (13) | (19) | 69 | 5 | 8 | 64 |
| Net gains (losses) on sales of securities | - | (9) | NM | 9 | 10 | NM | (1) |
| Other noninterest income | 222 | 22 | 11 | 200 | 61 | 44 | 139 |
| Total noninterest income | $1,981 | $92 | 5% | $1,889 | $298 | 19% | $1,591 |

Noninterest income was $2.0 billion, up $92 million, or 5%, from the prior year. Capital markets fees increased $101 million, or 67%, primarily reflecting higher advisory fees supported by the impact of Capstone Partners, loan syndication fees, foreign exchange fees, and interest rate derivative fees. Gain on sale of loans increased $48 million, primarily due to sales of SBA loans during the first through third quarters of 2022. Trust and investment management services income increased $17 million, or 7%, primarily reflecting the full-period impact of the TCF acquisition and an increase in sales. Service charges on deposit accounts increased $12 million, or 3%, primarily due to the full-period impact on volume due to TCF customers, partially offset by the impact from Fair Play enhancements implemented in the second half of 2022. Insurance income increased $12 million, or 11%, primarily reflecting an increase in agency commissions. All other increases were largely a result of the full-period impact of the TCF acquisition. Offsetting these increases, mortgage banking income decreased $165 million, or 53%, primarily reflecting lower salable volume and secondary marketing spreads, bank owned life insurance decreased $13 million, or 19%, primarily due to valuation adjustments and lower benefit claims, and net gains on sales of securities decreased $9 million, as the prior year included sales reflecting securities optimization following the acquisition of TCF.

50 Huntington Bancshares Incorporated