HUNTINGTON BANCSHARES INC /MD/

Overview

Our business segments are based on our internally aligned segment leadership structure, which is how management monitors results and assesses performance. We have two business segments: Consumer & Regional Banking and Commercial Banking. All other items not included within our two business segments are reported within the Treasury / Other function, which primarily includes technology and operations and other unallocated assets, liabilities, revenue, and expense.

Business segment results are determined based on our management practices, which assign balance sheet and income statement items to each of the business segments. The process is designed around our organizational and management structure and, accordingly, the results derived are not necessarily comparable with similar information published by other financial institutions.

Revenue Sharing

Revenue is recorded in the business segment responsible for the related product or service. Fee sharing is recorded to allocate portions of such revenue to other business segments involved in selling to or providing service to customers. Results of operations for the business segments reflect these fee-sharing allocations.

30 Huntington Bancshares Incorporated

Expense Allocation

The management process that develops the business segment reporting utilizes various estimates and allocation methodologies to measure the performance of the business segments. Expenses are allocated to business segments using a two-phase approach. The first phase consists of measuring and assigning unit costs (activity-based costs) to activities related to product origination and servicing. These activity-based costs are then extended, based on volumes, with the resulting amount allocated to business segments that own the related products. The second phase consists of the allocation of overhead costs to the business segments from Treasury / Other. We utilize a full-allocation methodology, where all Treasury / Other expenses, except reported acquisition-related expenses, if any, and a small amount of other residual unallocated expenses, are allocated to the business segments.

Funds Transfer Pricing (FTP)

We use an active and centralized FTP methodology to attribute appropriate net interest income to the business segments. The intent of the FTP methodology is to transfer interest rate risk from the business segments by providing modeled duration funding of assets and liabilities. The result is to centralize the financial impact, management, and reporting of interest rate risk in the Treasury / Other function where it can be centrally monitored and managed. The Treasury / Other function charges (credits) an internal cost of funds for assets held in (or pays for funding provided by) each business segment. The FTP rate is based on prevailing market interest rates for comparable duration assets (or liabilities). The primary components of the FTP rate include a base (market) rate, a liquidity premium, contingent liquidity and collateral charges, and option cost.

Net Income (Loss) by Business Segment

Net income (loss) by business segment is presented in the following table.

2025 3Q Form 10-Q 31

Consumer & Regional Banking reported net income of $998 million in the nine-month period of 2025, a decrease of $100 million, or 9%, compared to the year-ago period. Segment net interest income increased $5 million, primarily due to a $4.7 billion, or 7%, increase in average loans and leases, partially offset by a 4 basis point decrease in NIM. The provision for credit losses increased $79 million due primarily to higher net charge-offs and loan growth. Noninterest income increased $91 million, or 9%, primarily due to a $24 million gain on the sale of a portion of our trust and custody business, which also resulted in a corresponding decrease in our total trust assets, an increase in wealth and asset management revenue, driven by increases in trust income and management account fees, and an increase in payments and cash management revenue, reflecting an increase in merchant acquiring transaction revenue. Noninterest expense increased $144 million, or 6%, primarily due to the allocation of higher indirect expenses in addition to higher direct personnel costs.

32 Huntington Bancshares Incorporated

Commercial Banking reported net income of $893 million in the first nine-month period of 2025, an increase of$40 million, or 5%, compared to the year-ago period. Segment net interest income decreased $15 million, or 1%, primarily due to a 35 basis point decrease in NIM driven by a $6.4 billion, or 17%, increase in average deposits and lower loan yields, partially offset by a $5.3 billion, or 10%, increase in average loans and leases and lower deposit costs. The provision for credit losses decreased $52 million due primarily to lower net charge-offs and a lower ACL coverage ratio, partially offset by loan growth. Noninterest income increased $67 million, or 14%, primarily due to increases in capital markets and advisory fees, customer deposit and loan fees, and payment and cash management revenue. Noninterest expense increased $56 million, or 6%, primarily due to increases in allocated overhead expense.

Treasury / Other

The Treasury / Other function includes revenue and expense related to assets, liabilities, derivatives, and equity not directly assigned or allocated to one of the business segments. Assets include investment securities and bank- owned life insurance.

Net interest income includes the impact of administering our investment securities portfolios, the net impact of derivatives used to hedge interest rate sensitivity, and the financial impact associated with our FTP methodology, as described above. Noninterest income includes miscellaneous fee income not allocated to other business segments, such as bank-owned life insurance income and securities and trading asset gains or losses. Noninterest expense includes certain corporate administrative expenses, acquisition-related expenses, if any, and other miscellaneous expenses not allocated to other business segments. The provision for income taxes for the business segments is calculated at a statutory 21% tax rate, although our overall effective tax rate is lower.

2025 3Q Form 10-Q 33

Treasury / Other reported a net loss of$199 million in the first nine-month period of 2025, compared to a net loss of $541 million in the year-ago period, driven by improvement in net interest income, partially offset by lower noninterest income and a decrease in the benefit for income taxes. Net interest loss decreased $459 million primarily due to the net impact of FTP credits assigned to each business segment and hedging. The benefit for income taxes decreased $60 million primarily due to a decrease in pre-tax loss, partially offset by a reduction in the Company’s effective tax rate as a result of the remeasurement of deferred tax assets for changes in certain state tax laws which were enacted in the second quarter of 2025.