Jan 22 (Reuters) - Huntington Bancshares HBAN.O said on Thursday it expects its interest income for 2026 to hit a record high, as the regional lender benefits from accelerating loan demand and expanding margins.
Borrowing has picked up across the banking industry, supported by interest rate cuts by the U.S. Federal Reserve. Deposit costs have also eased, lifting the outlook for lending profitability.
Huntington expects net interest income, the difference between how much a bank pays on loans and earns on deposits, to grow between 10% and 13% for the full year, on a standalone basis. It reported $6.06 billion in 2025.
The lender had agreed to buy smaller rival Cadence Bank CADE.N for $7.4 billion in October. Huntington expects the deal, after it closes, to add between $1.85 billion and $1.90 billion to the full-year NII forecast.
The company sees average loans climbing in the range of 11% to 12% this year, on a standalone basis, while average deposits are estimated to grow between 8% and 9%.
"Our focus for 2026 remains on driving strong organic growth. We entered the year with excellent momentum and our backlogs and pipeline are robust," CEO Steve Steinour said in a statement.
The bank's interest income climbed 14% to $1.6 billion during the fourth quarter, driven by margin expansion and loan growth.
Huntington has been looking to grow its footprint through acquisitions. Other than Cadence, it also struck a $1.9 billion all-stock deal to buy Veritex in July.
Steinour said the deals would springboard its growth across Texas and the South, and both integrations were proceeding smoothly.
Average total loans and leases increased $18.4 billion, or 14%, over the year earlier, inclusive of the impact of the Veritex acquisition.
The bank posted an adjusted profit of 37 cents during the three months ended December 31, in line with analysts' average estimate, according to data compiled by LSEG.
Its shares were last down 1.4% in volatile premarket trading.
(Reporting by Manya Saini in Bengaluru; Editing by Shilpi Majumdar)
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