Huntington Bancshares Incorporated (HBAN): SWOT Analysis [Nov-2025 Updated]

You're looking for a clear, actionable breakdown of Huntington Bancshares Incorporated's (HBAN) position as we close out 2025. The direct takeaway is that HBAN maintains a strong, sticky deposit base in its core Midwest markets, but it faces persistent challenges in efficiency and must navigate a tightening regulatory environment and intense competition from larger national players.

Honestly, the market is giving mixed signals. The bank's solid regional foundation is a strength, but its cost structure needs serious attention to drive the kind of shareholder returns we've seen from top-tier peers.

Strengths: The Core Foundation

Huntington Bancshares' greatest asset is its foundation of loyal customers, largely due to its consumer-friendly 'Fair Play' banking model, which includes popular features like 24-Hour Grace and Asterisk-Free Checking. This loyalty translates directly into a strong, sticky deposit base. For Q3 2025, average total deposits stood at approximately $164.8 billion, growing 5% year-over-year, which provides a stable, lower-cost funding source than wholesale markets. [cite: 12 from step 1, 10 from step 1]

Plus, the bank holds top-tier market share in key states like Ohio and Michigan, giving it a powerful regional moat. Its diversified loan portfolio, with average total loans at $135.9 billion in Q3 2025, is well-balanced across commercial and industrial (C&I) and consumer segments. [cite: 5 from step 1, 10 from step 1]

• Loyalty drives low-cost funding.

Weaknesses: The Efficiency Hurdle

The primary financial drag for HBAN is its operating efficiency. The cost-to-income ratio (or efficiency ratio) remains elevated compared to many super-regional peers, indicating a need for greater operating discipline. Management is well aware, targeting an efficiency ratio improvement of more than 2.5% for the full year 2025, but the work is ongoing.

Here's the quick math on profitability: The bank's Return on Average Assets (ROA) was 1.19% in Q3 2025. To be fair, that's a solid number, but it trails peers like F.N.B. Corporation, which reported an ROA of 1.29% in the same quarter, showing HBAN has room to improve asset utilization.

• Integration risks from past acquisitions still require defintely careful management.

Opportunities: The Sunbelt and Fee Income Play

The biggest opportunity for HBAN is its strategic expansion into higher-growth markets and boosting non-interest income. The completed acquisition of Veritex Holdings, Inc. in October 2025, which added approximately $12.8 billion in assets, immediately accelerates its presence in the dynamic Texas market, reducing its Midwestern geographic concentration risk. [cite: 2 from step 1]

The bank is also capitalizing on the interest rate environment; its Net Interest Margin (NIM) expanded to 3.13% in Q3 2025, which should continue to grow with effective balance sheet management. Also, noninterest income surged to $628 million in Q3 2025, a 33% sequential increase, showing that expanding wealth management and capital markets services is a clear path to higher-margin revenue. [cite: 3, 10 from step 1, 12 from step 1]

• M&A is the fast track to new markets.

Threats: Competition and Economic Headwinds

The competitive landscape is brutal. HBAN is constantly battling national behemoths like JPMorgan Chase and Bank of America, who have massive capital and technology budgets to challenge traditional lending and payment services. Plus, the threat from non-bank fintechs is real, especially in consumer lending and payments.

What this estimate hides is the geographic risk: a potential economic slowdown in the Midwest, particularly impacting the manufacturing and automotive sectors, could pressure the quality of its Commercial Real Estate (CRE) and C&I loan portfolios. Finally, evolving and stricter regulatory requirements, especially the potential for increased capital requirements, will increase compliance costs and potentially limit capital return to shareholders.

• National banks have deeper pockets for tech.

Huntington Bancshares Incorporated (HBAN) - SWOT Analysis: Strengths

Strong, sticky deposit base across the Midwest, reducing funding costs

You want a bank with a reliable, low-cost funding engine, and Huntington Bancshares Incorporated definitely has that. Their deposit franchise, deeply rooted in the Midwest, is a core strength, acting as a buffer against volatile wholesale funding markets.

As of the second quarter of 2025, Huntington's average total deposits grew by a solid $9.9 billion, representing a 6% year-over-year increase. This growth is a key indicator of customer retention and acquisition success, and it keeps their cost of funds (the interest they pay on deposits) in check. For instance, total deposit costs were a competitive 2.03% in the first quarter of 2025, a drop of 13 basis points from the prior quarter. The stickiness of these deposits is further highlighted by the fact that customer deposits represented 120% of total loans as of December 31, 2024, giving them excellent funding stability.

Top-tier market share in key states like Ohio and Michigan

In regional banking, market density translates directly to operational efficiency and brand strength. Huntington Bancshares commands top-tier deposit market share in its core operating states, particularly Ohio and Michigan, which are vital economic hubs in the Midwest.

The bank is a dominant player in its home state. As of June 2025, Huntington Bancshares held the #2 rank in Ohio by total deposits, capturing a significant 17% market share statewide. In key Metropolitan Statistical Areas (MSAs), the dominance is even more pronounced. This regional concentration means lower marketing costs and a stronger brand presence, which is defintely a competitive advantage over national banks.

• Columbus, OH (HQ): #1 rank with a 43% deposit market share.
• Grand Rapids, MI: #1 rank with a 19% deposit market share.
• Cleveland, OH: #2 rank with a 12% deposit market share.

Diversified loan portfolio with a focus on commercial and industrial (C&I) lending

The loan book is well-diversified, but the real power lies in the deliberate focus on Commercial and Industrial (C&I) lending. This segment-loans to businesses for working capital, equipment, and operations-is typically higher-yielding and reflects a deeper relationship with commercial clients, which is a hallmark of a successful regional bank.

As of June 30, 2025, C&I loans represented the single largest component of the portfolio, totaling $60.723 billion and accounting for 45% of the total loan and lease portfolio. Overall, the average total loans and leases reached $133.2 billion in the second quarter of 2025, growing 8% year-over-year, with commercial loans growing a robust 10% annually.

Here's the quick math on their portfolio mix, showing the C&I focus:

The 'Fair Play' banking model builds high customer loyalty and retention

Huntington Bancshares' 'Fair Play' banking model is a genuine competitive differentiator, especially in the consumer space, where fee-based revenue is under scrutiny. This model is not just marketing fluff; it's a set of concrete, customer-friendly policies that drive loyalty and reduce churn, making their deposit base even stickier.

The bank has institutionalized features that directly address common consumer pain points, particularly around overdrafts and access to funds. This empathetic approach is why they've been recognized as a trusted brand leader in their markets.

Key features of the 'Fair Play' model include:

• $50 Safety Zone®: No overdraft fee if the account is overdrawn by $50 or less.
• 24-Hour Grace®: Gives customers an extra business day to cover an overdraft before a fee is charged.
• Early Pay: Provides customers access to their direct deposit paycheck up to two days early.
• Standby Cash®: A short-term line of credit from $100 to $500, available free with automatic payments.

Huntington Bancshares Incorporated (HBAN) - SWOT Analysis: Weaknesses

Cost-to-income ratio remains elevated, indicating a need for greater operating efficiency

You're looking at Huntington Bancshares Incorporated's (HBAN) profitability, and the efficiency ratio (or cost-to-income ratio) is a number that always jumps out. It tells you how much it costs the bank to generate a dollar of revenue. For Q3 2025, Huntington's efficiency ratio was reported at 57.4%. That's a solid improvement, beating analyst estimates of 59.1%, but it still means that for every dollar of revenue, nearly 57.5 cents goes toward operating expenses. That's a lot of overhead.

To be fair, the bank is actively working on this. They expect the combination with Veritex Holdings, Inc. to enhance the efficiency ratio by approximately 1 percentage point. Still, the bank also raised its guidance for noninterest expense to a growth of approximately 6.5% for the full year 2025, up from the prior 5%-6% range. So, while they are growing revenue, the cost base is also expanding quickly. They need to defintely find a way to make that revenue growth outpace the expense growth consistently.

Geographic concentration risk heavily tied to the economic health of the Midwest

The core of Huntington Bancshares Incorporated's business is deeply rooted in the Midwest, which is a structural weakness you can't ignore. The company is a $208 billion asset regional bank holding company headquartered in Columbus, Ohio, with a significant presence in that market. While they operate 971 branches across 13 states, a disproportionate amount of their loan and deposit base remains tied to the economic cycles of the Great Lakes and surrounding states.

This geographic concentration creates a single point of failure. If the key Midwestern industries-like manufacturing or automotive-hit a prolonged downturn, the impact on Huntington's credit quality and loan demand would be immediate and severe. They are trying to diversify, announcing an expansion into high-growth markets like Texas and the Carolinas, but the current risk is real. It's a classic regional bank problem: great local market share, but limited insulation from regional economic shocks.

Lower Return on Assets (ROA) compared to many super-regional bank peers

Return on Assets (ROA) is the ultimate measure of how well a bank uses its assets to generate profit. For Huntington, the ROA, while improving, still lags behind the top-performing super-regional banks. For the third quarter of 2025, the bank reported a Return on average assets of 1.19%. This is up from 1.04% in the second quarter of 2025, which is good progress. But, when you look at peers who consistently hit 1.30% to 1.50% or higher, it tells you there's still a gap in asset utilization efficiency.

Here's the quick math: a lower ROA means the bank is either holding too many low-yielding assets, or its operating expenses (the high cost-to-income ratio we just discussed) are eating up too much of the gross income. This is a critical metric for long-term shareholder value, and closing this gap is paramount.

A look at the recent trend:

Integration risks from past acquisitions still require careful management

Huntington Bancshares Incorporated has been an active acquirer, and while that strategy is essential for growth and diversification, it creates significant integration risk. The biggest immediate risk for the bank 'remains overexpansion and integration challenges,' which is a fair assessment.

The recent combination with Veritex Holdings, Inc. was scheduled for October 20, 2025, and that deal, while a 'key short-term catalyst' for Texas expansion, also 'brings integration risk.' Plus, the bank announced the acquisition of Cadence Bank on October 27, 2025. Managing two major integrations-Veritex and Cadence Bank-in quick succession adds complexity, especially in merging IT systems, retaining key personnel, and preventing customer attrition.

The integration challenge is multifaceted:

• Merging core banking systems without service disruption.
• Realizing the projected cost and revenue synergies on time.
• Navigating cultural differences between the acquired entities.
• Managing the heightened risk of unforeseen costs.

The bank is pushing hard for growth, but the integration execution must be flawless to avoid having these opportunities turn into costly distractions.

Huntington Bancshares Incorporated (HBAN) - SWOT Analysis: Opportunities

You're looking for where Huntington Bancshares Incorporated (HBAN) can really drive growth, and the opportunities are clear: it's all about fee income, margin management, and aggressive expansion into the Sunbelt. The company is actively executing on these, which is why we're seeing raised guidance for the 2025 fiscal year.

Expand wealth management and capital markets services to increase fee income

The shift toward non-interest income (fee income) is a major opportunity, making revenue less reliant on the volatile interest rate environment. Huntington is already seeing strong results from its focus here. For the full year 2025, the company has raised its standalone fee income growth guidance to approximately 7%, up from an earlier range of 4% to 6%.

This momentum is tangible. In the first quarter of 2025, wealth management fees jumped 15% year-over-year, and capital markets fees saw an even stronger increase of 20%. By the third quarter of 2025, the key strategic fee businesses-payments, wealth management, and capital markets-collectively grew 13% year-over-year. This is defintely a high-return area. Critically, the Veritex Holdings, Inc. acquisition opens up a new channel to cross-sell these high-margin services, specifically targeting Veritex's commercial and consumer customers with Huntington's full suite of payments, wealth management, and capital markets products.

Capitalize on rising interest rates to grow Net Interest Margin (NIM)

While the Federal Reserve's rate path is always a question mark, Huntington has proven adept at managing its balance sheet to expand its Net Interest Margin (NIM). The company's NII (Net Interest Income) forecast for the full year 2025 has been increased significantly to a growth rate of 10% to 11% on a standalone basis. That's a powerful testament to their strategy.

Here's the quick math on how they're doing it:

• Deposit Cost Management: The total cost of deposits fell to 2.03% in Q1 2025, a 13 basis point drop from the prior quarter, which directly boosts NIM.
• Balance Sheet Repositioning: Huntington strategically sold approximately $900 million of lower-yielding bonds, taking a one-time loss to reinvest the proceeds in higher-yielding assets, which will lift overall returns going forward.
• NIM Expansion: The NIM was 3.11% in Q2 2025 and expanded slightly to 3.13% in Q3 2025, demonstrating stability and growth even amid market fluctuations.

Further digital transformation to lower operating costs and enhance customer experience

Digital transformation isn't just a buzzword here; it's a key driver of profitability via efficiency gains. The goal is positive operating leverage (revenue growing faster than expenses), and Huntington is achieving it. The outlook for full-year 2025 operating leverage has been expanded to over 2.5 percentage points of efficiency ratio improvement, a massive jump from the original budget of approximately 1%. That's real money saved and reinvested.

The investment in digital is paying off in customer acquisition, too. New consumer checking households acquired through the digital channel are outperforming regional peers by 25%. This shows a successful strategy of lowering the cost to acquire a customer (CAC) while simultaneously driving volume. Plus, the cost synergies from the Veritex acquisition alone are expected to drive a 1 percentage point improvement in the efficiency ratio.

Targeted M&A to expand into adjacent, higher-growth Sunbelt markets

The Sunbelt is where the population and commercial growth is happening, and Huntington is making bold moves to capture it. This is a clear, actionable strategy to diversify away from its Midwest core.

The strategy involves a 'one-two punch' of acquisitions in Texas and accelerated organic growth in the Carolinas:

• Texas: The combination with Veritex Holdings, Inc. accelerates organic growth in the dynamic Texas market, making Huntington the fifth largest in Dallas among regional bank peers. This was quickly followed by the announced acquisition of Cadence Bank in October 2025, which adds a significant southern U.S. presence.
• Carolinas: The company is accelerating organic branch expansions in North and South Carolina. These six Carolina regions represent an aggregate deposit market of over $150 billion, with an expected annual growth rate of 1.2% through 2029.

The table below summarizes the financial impact of these strategic opportunities, based on 2025 guidance and performance:

Huntington Bancshares Incorporated (HBAN) - SWOT Analysis: Threats

Intense competition from larger national banks like JPMorgan Chase and Bank of America

You're operating in a regional market, but the biggest players are still your fiercest competition. JPMorgan Chase and Bank of America (BofA) have a massive scale advantage, which they use to invest heavily in technology and offer lower-cost products, making it tougher for Huntington Bancshares to compete on price or digital experience.

To put their size in perspective, as of the first quarter of 2025, JPMorgan Chase reported total assets of a staggering $4,357 billion, and Bank of America was close behind with $3,349 billion in total assets. Huntington Bancshares, with approximately $208 billion in assets, is simply playing a different game. This scale difference allows the national banks to absorb compliance costs and weather economic storms much more easily.

Their national footprint also lets them cherry-pick the most profitable commercial and consumer segments within Huntington Bancshares' core Midwest and newly expanded Texas markets, often undercutting your pricing. This is defintely a constant pressure on your Net Interest Margin (NIM).

• JPMorgan Chase's Q3 2025 EPS was $5.07, showing their profit-generating power.
• BofA's vast branch network and digital platforms attract high-value customers.
• Huntington Bancshares must defend its $135.9 billion average total loan portfolio against their aggressive expansion.

Potential economic slowdown in the Midwest, impacting commercial real estate (CRE) and C&I loan quality

The Midwest economy is generally stable, but a slowdown is a major threat because a significant portion of Huntington Bancshares' lending is tied to regional Commercial Real Estate (CRE) and Commercial and Industrial (C&I) clients. You're seeing a national wave of CRE loan maturities coming due, which will force property owners to refinance at much higher rates, exposing overleveraged deals.

Here's the quick math: Nearly $1 trillion in commercial real estate loans are set to mature nationally over the next few quarters. While the Midwest multifamily and retail sectors showed resilience in mid-2025, the office sector remains challenged, and this refinancing crunch will inevitably cause distress in some of your regional loan book. For Huntington Bancshares, managing the credit quality of its $135.9 billion average total loan portfolio is paramount.

A rise in non-performing assets would directly increase your provision for credit losses, cutting into the strong Q3 2025 net income of $629 million. This risk is uneven, but it's real, especially in older Class B and C office and multifamily properties that still have room to decline in value.

Evolving and stricter regulatory requirements, increasing compliance costs

The regulatory environment for regional banks is only getting more complex and expensive, especially following the recent industry volatility. Even with potential shifts in administration, the focus on financial resilience and issue remediation remains high in 2025.

The problem is that compliance creates fixed costs that disproportionately hit regional banks compared to the megabanks. For mid-sized banks, compliance costs are a material part of the expense base. Banks with assets between $1 billion and $10 billion report compliance costs of 2.9% of non-interest expenses, and compliance is responsible for 42.8% of a bank's accounting and auditing spending.

Huntington Bancshares has already guided for noninterest expense growth of approximately 6.5% for the full 2025 fiscal year, which is partially driven by these rising regulatory and technology costs. Failure to keep up with new Anti-Money Laundering (AML), data privacy, and ESG (Environmental, Social, and Governance) reporting requirements can lead to massive fines, which globally reached $4.5 billion in 2024 for financial crime and consumer protection breaches.

Disruption from non-bank fintechs challenging traditional lending and payment services

Fintechs are not just a nuisance; they are actively carving out market share in Huntington Bancshares' most profitable, high-touch areas: payments and specialized lending. These non-bank innovators are faster, more agile, and often offer a better user experience for specific services.

The disruption is quantifiable: over 28% of traditional banking services are projected to be disrupted by financial technology in the next four years. In the payments space, which is a key fee-income driver for banks, virtual cards are set to account for 4% of all B2B payment value globally in 2025, overtaking cash or checks for the first time.

This means your commercial clients are increasingly turning to fintech solutions like Stripe, PayPal, or specialized virtual card providers for their B2B expense management, which directly threatens Huntington Bancshares' noninterest income, which was $628 million in Q3 2025. If you don't keep pace with their digital offerings, you risk becoming a utility for deposits while losing the high-margin fee business.