At this time, we will be conducting a question and answer session. Thank you. Our first question comes from the line of Erika Najarian with UBS. Please proceed with your question.

Zachary, I hope you feel better if you are listening. My first question is you know, thank you for ripping the proverbial Band Aid off, in terms of earlier resetting the guidance at a September conference I guess, a 2 part question because clearly the stock at $15 relative to the $1.75 to $1.83 is less than 10 times. And so I think that what the market is asking and what the question that investors have is, you know, in terms of that track to 2027, number 1, are we done with the cuts? You know, obviously, you know, there is the economy and there is rates, but are we done with the cuts? And, you know, within that question, you know, what was. You know, other than the rate pass, what did you not quite get right? When you first set the 2027 bogey?

Erika, thanks for the question. Steven, I will start and I will turn it over shortly to Eric. First, we are quite confident in the earnings outlook Eric will give you a couple of different ways to look at it in a minute. Second, in terms of what we did not get right, we I believe we are in a very. Not believe we are in a very different interest rate environment and a very inflationary environment. And we are in a much different competitive environment. You have seen us pull back in a number of areas. That we referenced in the second quarter call. I think Brent referenced indirect auto and home mortgage as 2. When we came into the year, we talked about wanting to adjust our commercial real estate exposure over a couple of years. that is happening much faster than we would have projected. Reflecting a competitive environment that is more significant this year than we have seen. And you are seeing it deposit pricing and in other ways as well. But that. Those would be the primary factors in terms of needing to make the adjustment we did at the at a recent conference. Eric, let me turn it to you in terms of layering in the outlook for next year.

Thank you, Stephen. And hello, Erika. So I mean, think just to pick up on the tail end of Stephen's comments. Coming into the year, the expectation, I think, was for rate cuts and it was looking at that point as to be a very benign competitive environment. And what you have seen is now the opposite where you have seen rate hikes. And real intensification around competition in a few ways. And certainly, that is the environment that we are extrapolating into next year. We expect no diminution in the overall competitive environment. And so that characterizes how we are thinking about our guidance from here. And maybe just to do sort of a mathematical bridge, If I look at the consensus for this year, it looks like it is about $1.54. And for next year it is $1.76. So that is a $0.22 delta. So how do we bridge the $0.22? I think there is effectively 3 components to that. The first is we expect to realize about $150 million of incremental cost synergies as we anniversary the run rate benefits that we have achieved in terms of the cadence synergies late this year. So that is about $0.06 of delta. And our share repurchase program is about $0.02 So if I take $0.22 less $0.08 that gets me to $0.14 of core earnings growth. On a basis of $1.54 that is about an 8% to 9% growth rate, which is imminently achievable for us certainly relative to our history. But maybe 1 way to pressure test that Erika might be to look at the low end of the guidance next year and see if that still hangs together. So what are we saying? We are saying 6% loan growth which we are tracking to currently and expect to continue and flat and flat NIMs. That would tell you NII of about 6% plus a percentage point or 2 of fee income generation would get you to revs of 7%, 8% and operating leverage of 300 basis points. If you back out the $150 million that I just mentioned and just take the low end of our secular expectation of 100 basis points, You are looking at PPNR growth we think next year of 9% to 10%. So we feel very, very confident about delivering the 1.75 to 1.83 next year. Erika, thanks for the question. I am sure this is on the minds of most. Thank you. And, Erika, that was a good bridge.

And sort of a follow-up question maybe for both Stephen and Brant. On the CRE side, were there just sort Of Deals And Relationships In Sort Of Your New Markets That Did not Quite Pass The Huntington test in terms of the pressure from this, or was it the rate environment? And as we think about the PPNR growth of 9% to 10%., did you sort of pressure test that against your conservatism vis a vis you know, how you think of growth.

The answer is yes to the second question. And there was a fair amount of refinance activity as you, as you suggested, tied to a rate expectation. So we saw a fair amount of flow frankly, much more than we expected, in the month of July and August into Fannie Freddie Some of it went to debt funds. I would characterize that as loans that would be a low pass or criticized on the CRE side. So the debt funds were offering more flexibility than the perceived posture of us but most of it went to Freddie and Fannie. And it was not the new partnerships the majority of it came out of the existing franchise. Again, a good rate at a hike anticipation and an opportunity to lock in particularly the Freddie Fannie stuff. At that at that time. Now going forward with the. With rates up, the activity will slow and that is in our expectation and outlook for 27. The area we have been most focused on is the amount of construction commitments and that significantly reduced during the quarter. it is about percent for commercial real estate construction commitments. So over the course of the next couple of years, that. Those commitments will continue, but at a much more modest level. And we will manage it on that base. And we see this is just a risk management strategy on our part.

Got it. Thank you.

Our next question comes from the line of Jon Arfstrom with RBC. Please proceed with your question.

Good morning, Jon.

Good morning. Good morning. Just a follow-up on some of these comments about lending, Steven. You are flagging a more competitive, less rational environment. What changes that in your view? And, you know, you are lagging the h 8 data a little bit. I am assuming you are not happy with that. But what in your mind is the right pace of loan growth for your company? Given all the new markets?

Well, Brant, add into this too, given his new responsibilities. But we. We are we are we are. Long term in our approach we are going to maintain our aggregate moderate to low risk appetite. We have all been talking about a k shaped economy that is getting more stressed with rising rates. And an expectation of further rate rises. Our own view, at least my view is that rates are going to be up for. Stay up for a while. At higher levels. So with that, that will put pressure on pricing commercial real estate and elsewhere. And that will have a. Over time, a dampening effect And I do not know when that may occur, but having been around this for 4.5 decades, I am a little more cautious perhaps. Than some of my peers at this moment. I do not see a tipping point. I do not think this is a 2006-2007 event, but there is just so much volatility in the markets today. And I do not recall the amount of challenges that we are seeing globally at any time in my career. So I am naturally, we are going to be sensitive to that in terms of how much volume we want to we wanna add. Additionally, with the competition, we are seeing areas where we are just not getting risk adjusted returns. And rather have capital and return it to shareholders than put it out at what we think would be very low returns, in some cases, not even meeting our minimum expectations. So, John, I am not calling for a downturn. But just trying to be cautious as we as we tighten up here with 17 years of recovery behind us. Brant, what do you want to add?

Yes. John, I would just add a couple of things. 1, to reiterate Stephen's point, auto and specifically resi are 2 places that margins have gotten much tighter, obviously, the case of resi demand a little lower because of interest rates. But our pullback really reflects more of capital allocation discipline versus a change in the ultimate business. And just from a Q3 perspective, I would say loan balances were pretty much as we said and as we expected But we are also still tracking towards our guide for the full year 2026, which as you know would imply a strong fourth quarter. And you see the momentum for that strong fourth quarter in the end of period balances at the end of the quarter. Pipelines remain strong. In fact, in a number of our commercial businesses, the largest pipelines we seen. And so we feel confident about our ability to grow into the fourth quarter and also achieve the guidance that we have outlined for growth in 2027. And we are assuming that those competitive pressures that we are feeling in those 2 businesses continue into 2027. Should that change? And should that become more attractive, then we have obviously upside opportunity there. But we are assuming that, that will continue for the full year next year. Right.

Okay. I guess the follow-up on that and I think what you are saying is it is just a competitive issue. it is not a credit issue. And Stephen, you are not seeing anything from a credit point of view that is going to change your appetite? Is that fair?

that is correct, Jon. You know, there is a. We are we are making a strategic credit capital allocation in terms of commercial real estate. And to adjust here, which we expect to continue to do over time. But you know, the businesses are. The other businesses are doing very well. And in terms of both real estate and indirect auto lending, that is just pricing and return. The capital allocation issue for us, referenced. We do not change our underwriting. We have not changed it in 17 years. You see the quarterly stats on the consumer side. So if it gets back to where the returns are adequate, then we will open it up.

Alright. Thank you very much.

Thank you.

Our next question comes from the line of Ken Usdin with Autonomous Research. Please proceed with your question.

Hey, thanks. Good morning. Just a follow-up bridge to I am good. Thanks. I am good. Just another follow-up on the bridge to 27 Just because there is a gap in belief between the PPNR and the EPS, it is hard to look this far out, but since you did on the walk, what is your outlook for credit look like in that? And maybe even just help with tax rate and could the buybacks be bigger even than what you have outlined as your expectation? Thanks.

Ken, this is Brendan. I will start with the credit outlook, and Eric can chip in at the end here. We continue to feel very confident in the both the construct and our execution around the credit portfolio. We have had very stable and strong performance for the last year. We have through 9 months this year, we are at 27 basis points of charge offs in the low end of our guided range, and we feel really good about overall composition of the portfolio. And we expect that to continue into 2027. And so, where I sit today, I think credit is a very stable part of the portfolio and, you know, feel pretty good about how that sets us up for 2027. Eric? Do you have anything?

No. I think, Ken, you are very politely asking whether reserve release is part of our story for next year. And let's just say-- I am-- I think of this vigorously that it does not contemplate any reserve release in 2027. I think our expectation is that we will be building reserves as our portfolio grows.

Yep.

Okay.

And then should we just expect, like, similar tax rate to continue? And then you guys have articulated the buyback, so I assume that is the path that you would expect to continue on?

Yeah. I mean, no anticipated changes to our to our statutory for sure. In terms of share repurchases, you know, our expectation is that between this year and next year, to carry out a repurchase program of about $1.8 billion to $1.9 billion You saw us do the 100 million in the third. We have done 50 so far in the in the fourth. And it is our goal to continue execute against that plan. While also accreting capital higher as based largely on our very attractive return profile, which is nearly a 17% ROTCE.

Yeah. Okay. Thank you.

Our next question comes from the line of John Pancari with Evercore ISI. Please proceed with your question.

Good morning. Good morning, All right. I appreciate all the discussion around competition and everything. Maybe if you could kind of talk about how that is interpreted on the-- on the personnel side. Maybe if you could update us on the banker retention of the Texas acquisitions and relationship retention. And competitive pressures there, have you been able to retain the bankers that you anticipated now that you have integrated the deals? Or has that impacted at all your pricing strategy in those markets?

John, this is Brantley. I will take that. And first of all, I would say, as it relates to retention of both customers and bankers, it is within the expectations that we set at the beginning of this 1 of the things that we put a tremendous amount of focus on during the process leading up to the announcement was the identification of the leadership and the retention of the leadership. In fact, as we have described, we were able to bring several 100 leaders under the tent before the announcement so that they were sure about what their future looked like, and we were intentional about how to approach retention of those individuals. And I would say we have been very successful at retaining the top leadership within the Cadence organization. And then that is translated to achieving our expectations from a banker perspective. As it relates to customers, there is anytime you go through this, there are obviously going to be customers that may not fit the new organization, but none of that has been outside of our appetite. And we continue to see really significant opportunity in these new markets. And in fact, at Barclays, we shared that our expectations for revenue synergies were actually higher than what we had originally committed. So in short, John, we are feeling positive about where we are and very, very optimistic about the opportunities that these markets present to the company.

And, John, we are continuing to invest and build out capabilities in a variety of these markets. And in different business lines. Brant, do you want to pick up on that in terms of some of the wealth and commercial capital markets Yes, absolutely.

And so, John, go back to your question about pricing and how do we think about it. 1 of the biggest revenue synergies is just the optimization of the Cadence deposit portfolio. And that continues to we continue to be in line with our expectations there. And as you saw in our relative performance from a deposit perspective, I think our results this quarter reflect the opportunity that, that has presented. As it relates to the revenue synergies, bringing other capabilities of the company into these new markets is still a big opportunity. So whether that is in the payments area, where you saw from our prepared remarks, we continue to have very strong growth in specifically very strong commercial growth or whether that is in wealth management where we continue to experience growth, not just in the new franchise, but in the core franchise. That is still an opportunity. We are adding resources as we speak in those markets. And then in our capital markets business, capabilities that we bring to the table for the new Cadence customer base is substantial. And that business overall is doing quite well. First and second quarter were both record quarters. If you look at the year over year performance, in the capital markets business, it is very strong. So we are we are as I said, we are very optimistic about our opportunity. And across really the South and Texas and what this partnership for us.

John, we expect to continue to invest, add to the team's built further our capabilities to deliver locally in Texas and the South. As we go forward. We have had some great recruiting throughout the year. Particularly the commercial side and wealth businesses and that will continue that amongst the various businesses through 2027. And probably beyond.

Okay. Great. Thanks for that. I appreciate all the detail. And then on the funding side, I know in the prepared remarks, noted that the pace of deposit cost increases have moderated significantly recently. Maybe just give a little bit of color on what you are seeing and across what products? And maybe help us with the updated deposit cost outlook and maybe how you are thinking about the deposit beta as you look into the next several Fed actions? Thanks.

Yes, John, I will start with that and then Eric can pick up on the beta component. First of all, just from a competitive environment, related to funding and deposits, I would say it is relatively stable since September still very competitive, but we believe rational. We look at deposit pricing across more than 50 rate regions. And we continue to optimize the pricing market by market. Where we have seen more pressure is really on CD pricing. We are seeing some aggressive action in CD pricing. If you look at pricing across our different geographies, I would say overall the Midwest is still the most competitive market we are in. If you just look at pure cost of a new deposit dollar, but more competitive really in MMA And we are seeing some pressure in Texas in the Southeast from a CD perspective. We continue to think about pricing at both the market level, a product level, a customer level and then the opportunity I mentioned, earlier on continuing to optimize the cadence portfolio. Our focus has been and will continue to be on generating new primary checking households. The vast majority of our deposit production actually comes from those checking households. And then clearly adding checking households adds to the non interest bearing component of our deposit base. We are seeing some excellent success as we have introduced digital across the Southeast and Texas we actually see total production of checking households year over year up 35% for the company. And that is comparing the Huntington history the Veritex history and the Cadence history to us would also share, and you saw this on Page 6 of our debt our I am sorry, Page 8 of our debt. What we are seeing with growth in the deposit verticals as we built out specialty in commercial businesses, we are still seeing really strong growth in our commercial deposit verticals, which provide another opportunity. And then lastly, just deposit balance production overall business and consumer for the company because of the addition of the new geographies up 26% year over year. So the new geographies, the new capabilities in commercial the opportunity that we have to optimize in cadence footprint combined with that long term focus on primary households.

Give us confidence really as we go forward from a funding John, just to pick up on Brant's comments there. Of course, our overall objective is to core fund the organization and you saw that this quarter. With loan growth of about $2 billion and deposit growth of $2.2 billion. So really achieving the strategic objective of funding. As it relates specifically to beta as I indicated we are not anticipating any form of abatement in the competitive environment. And so embedded in our expectation is a beta of around 50 to 60%. And I guess the question is, you know, how well grounded is that expectation? And I would say there is a few things that give us some view that is a well pressure tested figure. First of course it is in fact what we are experiencing in the marketplace currently. At this very high level of rational but high level of competitive intensity. Secondly, intuitively you would anticipate that would be higher than prior upcycles. And so when we look back at the last upcycle, which was 22 to 24, our up beta was around 45%. So that does seem to substantiate that 50 to 60 is well grounded in a in a different and more competitive environment. And then lastly of course I was very interested in understand where we were relative to our peer set. Most of our peers either in their in their discussion on their quarter or when I did the arithmetic on their on their numbers generally look to be around 40 to 60% and I would anticipate that we would be at the higher end of the range given the specific complexion of our deposit base. So the net of that is that we feel that 60 is a very well grounded figure. Thanks, Eric. Appreciate it.

Our next question comes from line of Manan Gosalia with Morgan Stanley. Please proceed with your question.

Hey, Manan.

Hi. Can you hear me? Yeah. Now we can. Sorry. Go ahead. All right. Yes, I wanted to dig in a little bit more on the resiliency of the C and I loans. As you think about the demand from here and what might happen if rates rise further Where do you expect the demand to come from? And where do you expect the growth to come from? Is it Is it more from new geographies and new hires and share gains? Or is there all better demand coming because of AI even though rates might move higher? from here. Yeah.

Manan, this is Brant, I will take that question. First of all, just from an environment perspective, I would say the environment for commercial customers is still constructive. We see strong engagement from our customers Their outlook is generally positive heading into 2026 and 2027. We are still seeing customers pursue growth opportunities We are still seeing customers execute on a number of strategic initiatives. And I would say CapEx spending is still strong. And as a result of that, our pipelines are still healthy, well diversified and frankly, just given a number of the factors, some of the strongest that we have seen. And as I stated earlier, in Jon's question, you see that in the growth in our balances and the momentum that we are carrying into the fourth quarter. As it relates to your question of where does that come from in the future? Is it geography? Or is it is it new verticals? Where is it? it is really both. And that is the beauty of the opportunity that we have in front of us is that we have multiple potential growth levers. That gives us the flexibility to pull back in businesses like auto and resi where the yields are not as we would like and still grow the balance sheet. At a level that is very acceptable. But we still have a lot of opportunity, both in our core footprint where we are growing and you saw and also in the new geographies with what I would call our core geographic banking model. But then we have the expansion of a national commercial bank that is in its early innings still. We have a number of our specialty verticals that are really beginning to gain traction. You see that in the growth that we outlined year over year. And we expect that to continue. And so given the number of kind of broad based opportunities we have, that is how we feel confident in our ability to continue to grow at the guidance that we provided.

But, Manan, I will just add, we are the third or fourth largest bank equipment finance company. And the Build Back Better has accelerated depreciation and other tax attributes that are inducing investment. And we are just very well positioned to pick up on that on the equipment finance side. So our asset finance business is looking very good and strong going into the fourth quarter. As it has historically.

Got it. Very, very helpful. And maybe just to follow-up on the NIM side. So you spoke about all the benefits you have on the deposit side. The curve is better. So, you know, you should be getting some more back book repricing as well. And you are you are getting strong loan growth. So I guess, you spoke about stable NIM, but is there a higher likelihood of NIM expanding from here given that rates are moving higher and the longer the curve is up?

Yeah. Thanks, Manan. it is Eric. I would say that we are definitely anchoring our expectations in stable NIM. We are to your point modestly asset sensitive. And that does benefit us in an environment like the current 1 where you are seeing steepening. But I think as we think ahead, expect fairly significant benefit from fixed asset repricing But to the conversation that we just had, I think we are also taking a very conservative posture as it relates to our expectations around deposit costs. Deposit costs we are addressing both through the all of the mechanisms that Brant just described as well as well as the optimization that we are doing across the cadence footprint, which, of course, is 1 of the opportunities that we identified at the time of that of that partnership. And so I think really to the extent that there is upside it is going to be a function of the shape of the curve and the changes in the competitive environment. But those are not our baseline expectation and so we would anchor to a flat outlook from here. A level that, at a level that, relative to our history is very robust, you know, 3.25.

Got it. Thank you.

Our next question comes from the line of Scott Siefers with TD Cowen. Please proceed with your question.

Hey, so I definitely appreciate you guys addressing all these topics on the competitive environment. And I guess I would say, looks like based on what we see in the third quarter number specifically and some of the discussion here this morning, you are kind of having some success resolving those concerns. But 1 of the most frequent things I hear is there is just sort of skepticism around the competitive argument given that others seem to be impacted much less so than you all with kind of the exception being how much faster you all have grown in the last couple of years. I guess, just at a very top level or philosophically, in light of all you have said and what we can start to see in the numbers, can you sort of level set you know, where Huntington strives to play, from here as either leader middle of the pack, or laggard on pricing both on loans and deposits?

Scott, I can start with that. I mean, what we want to do with our customers is exchange value for value. that is how we would ultimately think about it. And we obviously look at the decisions that we make from a deposit perspective and how we how we optimize funding within the company, with the objective of creating the mode. The appropriate NIM and funding cost for the for the company. But we also look at that from the perspective of the value of an overall relationship of the customers that, that represents. As it relates to asset pricing, we are very conscious of using the capital appropriately. And where there is where we find that we cannot achieve an appropriate return on our capital, we chosen to take less volume. And that is ultimately what you have seen happen over the course of last 6 months, specifically in auto and to a lesser degree in resi mortgage. So we would we want to create returns and ultimately a return on tangible at the levels that we have described. And being disciplined about how we price deposits and funding and then being disciplined about how we allocate capital on the asset side of the sheet is an important part of that equation.

Scott, maybe just to pick up on the last tail end of your question about know, how it is reflected in the numbers. In an environment that Brant just described and you know, and what we are doing in terms of being you know, very rational around risk adjusted return. We are growing organically at 6% and are generating a nearly 17% ROTCE where our peers are growing 7. That does not seem to me like a significant difference with respect to overall production, pretty relative to our history where we have massively outperformed the industry in terms of growth.

Yeah. that is a and that is a good point. I appreciate that. Maybe as a follow on, was hoping. And maybe Eric best for you, just on the fee expectations, you know, any. Anytime there is a tweak cover small, you know, maybe a few weeks after the prior 1. It always generates a bunch of questions. So, mean, I think I have a sense for what might have changed in the last few weeks, but you know, what kind of caused the tweak lower for the full year fee guide? And then maybe you can sort of walk through the puts and takes you see to get to that sort of $57-ish number, implicit for the fourth quarter.

Yeah. So look, I mean, the fee story continues to be a really, really strong 1 for us. We came into this year as a reminder thinking on a reported basis, we would be somewhere between 26.5% to 29.5% growth. And now we think we are going to be at 31%. So there is been significant outperformance on fees really across all areas of our strategic fee categories, but particularly capital markets, which has been an outstanding story for us. You know, at Barclays, we said we would be around $7.30 and we came in just a little bit underneath that. Of course, the primary delta being the massive move higher in rates over the course of the quarter, which impacted some of our capital markets activity and to a lesser extent mortgage banking. But as we think about the fourth quarter, and the $750 million, recognizing that it is still a little earlier in the quarter, You know, we see several things contributing. First, capital markets continue to be strong and the underlying dynamics there are very healthy. We continue to give gain more customers across our corporate footprint and our attachment rates are improving. Payments had an extremely strong quarter this quarter. It was 3% sequential growth, right? So that is obviously annualizing to a 12% rate. So somewhat above the secular expectation that we have of high single digit. And wealth this quarter, we had 9% household growth. And on organic basis, 14% assets under management growth. So again, I think all of key strategic levers continue to work at a very significant level. So, you know, we have got, you know, we have got a pretty strong view on the on the 31%, notwithstanding all the fluidity in the rate and competitive environment.

Yeah. Perfect. Alright. Thank you for all the color. Thank you.

Let me close with 3 thoughts. I know we have gone over a little bit. Thank you, Chris, as well. You-- I interrupted you To do the wrap here. First, I think we are very strategically well positioned with substantial scale and high growth markets that we were not present in a year ago. And our value added fees are showing the investment and the returns we want to achieve. Second, we are disciplined in our execution and it is driving solid operating performance in a changing environment. Third, our partner integrations are delivering. We have got the cost synergies. They are fully achieved. Our revenue synergies are tracking ahead of original expectations. The partnerships are certainly expanding our growth runway of Texas and the South. And we are achieving all this while adhering to our aggregate moderate to low risk appetite, and you see that in some of the areas we are actually pulling back because we cannot get the return for the risk. Huntington today is a stronger, broader, and more capable company with an experienced management team that is been supplemented by the partnerships and the other investments we have made. We are very focused on execution and achieving or beating our objectives. But our outlook reflects the environment we see today, and we remain confident in our ability to deliver substantial long term shareholder value, including the EPS estimates for 2027. Finally, I want to thank our more than 25 thousand colleagues for everything they are doing. In a year of substantial change within the company their efforts to strengthen and bolster us are deeply appreciated. So thank you for your interest in the company. Have a great day, everybody.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.