Huntington Bancshares, Inc. - 5.875% PRF PERPETUAL USD 25 - Ser C 1/40th int

“All clear” on Cadence conversion + synergy ramp = earnings power in H2 - Huntington completed the Cadence systems conversion successfully (235 days after announcement). - Key surprising/positive datapoint: they grew deposits during the conversion weekend and in the weeks after, indicating strong customer trust/experience. - Operational scale achieved: 4,500 colleagues transitioned, hundreds of thousands of customers onboarded, ATM/ITM + signage changes, and 6,000+ high-value commercial customers onboarded with early products. - Synergy outlook: Cadence cost synergies on track; $365M in cost synergies targeted in Q4 (and later full run-rate benefits into 2027). Integration is now shifting from “conversion” to “growth.”

Strong Q2 core momentum (loans/deposits/fees) driving operating leverage - Loan growth: average loans +8.6% sequentially; normalized for day count, still ~+1.2% sequentially (ongoing organic expansion). - Deposit growth: average deposits +9.2% sequentially (core funding); normalized organic growth ~+1.8%, outpacing loan growth. - Fee growth: “value-added” fees +15% QoQ and grew strongly YoY; management highlighted payments +10% YoY, wealth +12% YoY, capital markets +46% YoY, loan/deposit fees +19% YoY. - Profitability signals: Adjusted PPNR +12% QoQ, Net interest income +8.5%, and 210 bps positive operating leverage (trailing 12 months).

Margin (NII/NIM) is the main near-term “bad/uncertainty” — but management expects it to improve - Management acknowledged NII guidance near the bottom end or slightly below the previously communicated range in 2H due to: - incremental deposit cost/funding cost pressure - Cadence balance sheet/full quarter impact - NIM: +10 bps YoY but -3 bps sequentially; they stated Q2 is the trough with expected NIM expansion from: - further fixed-asset repricing - release of added liquidity drag from Q1 - deposit optimization opportunities inside the Cadence portfolio - Competitive/rational deposit environment: management says competition is “active but rational” and they are using granular pricing across ~56 rate regions; they believe deposit optimization should mitigate cost pressure.