Huntington’s originations jump 91%

Huntington Bank ’s auto originations soared in the second quarter as Q2 earnings continue to point to mixed results for lender appetites for auto loans. Huntington joined Chase Auto in reporting year-over-year increases in auto outstandings while U. .S. . Bank , Ally Financial , Bank of America and Wells Fargo Auto reported YoY portfolio declines in Q2. PNC Financial ’s outstanding auto book was flat YoY in the second quarter and Citizens ’ auto book continued to run off. Fifth Third and Truist are the latest regional banks to report YoY declines in auto outstandings. Huntington eyes auto growth Huntington’s auto originations totaled $2.1 billion in Q2, up 31.3% QoQ and 90.9% YoY, according to the company’s July 19 earnings presentation. . Outstandings increased 3.9% QoQ and 3.12% YoY to $13.2 billion. . Auto loans made up 10.6% of the bank’s total portfolio. “Our auto business has performed very well this year and in the second quarter,” Chief Executive Steve Steinour said on the bank’s July 19 earnings call. “Some of the other banks, in the last year or so, pulled back on auto. . It's created a bit of an opportunity for us, and we'd expect to continue generating significant volume and growth.” New-origination yield for the Columbus, Ohio-based lender came in at 6.8% in Q2, unchanged compared with Q1 and down 1 basis point (bps) YoY. Huntington’s average loan-to-value ratio ticked up 1 percentage point QoQ but fell 2 percentage points YoY to 85% in Q2, according to the presentation. New -vehicle loans made up 35% of the bank’s total originations in the second quarter compared with 42% a year ago. Auto delinquencies and net charge-offs increased on a YoY basis, falling in line with similar trends reported in Q1 earnings, according to the presentation: Accounts 30-plus days past due totaled 0.87%, up 8 bps QoQ and 9 bps YoY; Payments 90-plus days past due came in at 0.06%, flat QoQ and up 1 bps YoY; and Net charge-offs hit 0.2%, down 7 bps compared with Q1 but up 10 bps YoY. The bank’s RV and marine outstandings landed at $6 billion in Q2, up from $5.9 billion reported in each of the previous three quarters. Huntington’s presentation also reported RV and marine delinquencies and net charge-offs for Q2: Accounts 30-plus days past due totaled 0.45%, up 6 bps QoQ and 12 bps YoY; Payments 90-plus days past due came in at 0.05%, up 1 bps QoQ and 2 bps YoY; and Net charge-offs hit 0.25%, down 11 bps compared with Q1 but up 12 bps YoY. Fifth Third auto book falls YoY Fifth Third’s indirect consumer portfolio, which includes auto, totaled $15.4 billion in Q2, up 0.7% QoQ but down 4.4% YoY, according to the bank’s July 19 earnings presentation. . The average LTV remained unchanged QoQ and YoY at 88%. Auto makes up 80% of the Cincinnati-based bank’s indirect secured consumer portfolio, while specialty lending, primarily on RV and marine products, makes up the rest, according to the presentation. “While total average portfolio loans and leases were flat sequentially, we continue to benefit from fixed-rate asset repricing, led by our indirect auto business,” Bryan Preston , chief financial officer, said on the company’s July 19 earnings call. “Average total consumer portfolio loans and leases were flat sequentially, primarily reflecting the increase in indirect auto originations, offset by a decrease in other consumer loan balances.” Auto payments 30 to 89 days past due rose 1 bps QoQ and 7 bps YoY to 0.83% in Q2, according to the presentation. . The net charge-off ratio landed at 0.46%, down 18 bps compared with Q1, but up 10 bps YoY. Fifth Third’s allowance for credit loss jumped to $283 million for a coverage ratio of 1.83% in Q2, up 2 bps from Q1 and 31 bps YoY. Truist auto book shrinks Truist’s auto lending remained muted in Q2 as its indirect auto outstandings hit $22 billion, down 0.7% compared with Q1 and 14.6% compared with Q2 2023. “In our consumer portfolio, average loans decreased $1 billion due to runoff in our residential mortgage portfolio and a decline in indirect auto,” Mike Maguire , chief financial officer, said during the bank’s earnings call today. Quarterly changes to the bank’s delinquencies, net charge-offs and credit losses, according to an earnings release today, include: Auto accounts 30 to 89 days past due hit 2.69%, up 28 bps QoQ and 56 bps YoY; Net charge-offs came in at 1.94%, down 32 bps QoQ but up 66 bps YoY; and Allowance for credit losses on indirect auto loans totaled $136 million, down 11.7% QoQ but up 18.3% YoY. Huntington, Fifth Third and Truist ranked as the 25th, 26th and 18th largest banks, respectively, by outstanding volume at yearend 2023, according to the latest Big Wheels Ranking data. Auto Finance Summit, the premier industry event for auto lending and leasing, returns Oct. 7-9 at Wynn Las Vegas. . To learn more about the 2024 event and to register, visit www. .AutoFinanceSummit.com.

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