Huntington CEO surveys ‘enormous change’ of past year

Bank leader says TCF acquisition brings Huntington closer to a thriving West Michigan market.
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The CEO of Huntington Bank said he is more bullish than ever on the economy and the bank’s future in Grand Rapids following the acquisition of TCF Bank last year.

Steve Steinour, president, CEO and chair of Huntington Bank, recently spoke to the Business Journal about the bank’s performance in the first quarter and his outlook on the integration with TCF Bank following the latter’s acquisition by the former in 2021.

Steve Steinour. Courtesy Huntington Bank

Huntington reported net income for the 2022 first quarter of $460 million, or 29 cents per common share, an increase of 3 cents from the prior quarter.

Net interest income increased $14 million, or 1%, from the prior quarter, reflecting increased average earning assets and net interest margin expansion of 3 basis points to 2.88%, the earnings report said.

Pre-provision net revenue growth increased 4% from the prior quarter, which Steinour called a record.

The 2022 first quarter benefited from the TCF acquisition and organic growth, Huntington reported. In the 2022 first quarter, adjusted earnings per common share were 32 cents, excluding 3 cents per common share of after-tax notable items, specifically $37 million of after-tax acquisition-related expenses.

Steinour described the first quarter as “exceptional,” with good revenue, loan and deposit growth; net interest income expansion; outstanding credit; and balance sheets “in great shape.”

“It was a very strong quarter for us,” he said. “Some of that’s a function of the combination with TCF. We just have more scale. We’re investing more in different businesses and especially technologies. This quarter, for example, will have a feature that will allow customers instant access on a deposit with us. It’s one of the pain points — a customer can make a deposit and we have to get it cleared, and that can take a couple days. So, a portion of the deposit would be instantly available for many of our customers. The continued programming and growth in our digital capabilities just has got that much bigger and better as a result of the combination.”

In the fourth quarter of last year, Huntington and TCF integrated their systems, which is always a difficult change, Steinour said, but he said “things are settling down nicely on that front.”

On the personnel front, Steinour said it has been a time of upheaval and change for the institution’s employees, many of whom were Huntington, Chemical Bank, TCF Bank or Talmer Bank legacy employees and went through multiple mergers and acquisitions over the past few years leading up to this point.

“There’s been enormous change, and in two of those three years, you have a pandemic, so we’re only right now getting out to see our new colleagues versus seeing them on a screen, and it’s much different to be in person,” he said.

Huntington Bank now has 350 branches across Michigan, more than any other bank in the state.

Steinour said Huntington will remain an active player in the Grand Rapids market, which he’s been traveling to bimonthly during the past 13 years of his tenure at Huntington, except during the height of the pandemic, and he has watched the city rapidly grow and develop.

He said with the growth of Medical Mile, in addition to the river activation, the formation of the Hotel District and all the other real estate and cultural developments in the city, he is “very bullish” on the city’s future.

“It’s a great market. In 2010, when Chrysler and GM filed for bankruptcy, there was 14% unemployment. That was the moment we started materially investing in Michigan, and we’ve been doing that ever since, and Michigan has been very, very good to us, including West Michigan.

“It’s really a great community … (and) there’s so much to be wildly enthusiastic about — most cities in America would trade for any one of these things.”

Steinour said Huntington continues to be the top Small Business Administration lender in the state, and he touted the bank’s $100 million Lift Local Business Program for minority-, woman-, and veteran-owned small businesses as another way that Huntington will continue investing in the region. He said the bank’s $5 billion Community Plan pledge to the state of Michigan, which includes home and consumer lending, small business lending, and community development lending and investing, was larger than its commitment to any other state in its footprint.

Steinour said he believes the long-term impacts of COVID-19 and the Russia-Ukraine conflict, though devastating and disruptive, could have positive ripple effects for Michigan when it comes to reshoring of manufacturing.

“I predict West Michigan will be a big winner, and you’ll see more and more manufacturing located here in the Midwest and especially in Grand Rapids and western Michigan,” he said.

Steinour said other areas on the west side of the state such as Traverse City and Holland have become “hotbed” summer vacation and retirement destinations, the universities are doing well, and the health care industry is booming.

“What’s not to be bullish about? And you can’t take it for granted; it’s been earned. People have really committed to the community, and we’re very pleased to be there.

“We’ve been in Grand Rapids now for a quarter-century, in some ways, it feels like we’re just getting started. We’re excited to do a lot more.”

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