and second call. quarter Thanks, to our earnings Tim welcome
Joining Niles, me Officer; Hankerd, our Chief Credit and John Financial today Officer. Chris Chief our are
continued share loan quarter Staunton period grew record In positive We and several announced the half as trends our deposit the the years deposit our completed branch average will and lending acquisitions franchise First that two also enhance commercial system we and We believe the further saw same first and half versus finished ago. we the solid per and of acquisition first levels last XX% conversion. we versus Huntington franchise with just value. XX% business driving growth earnings up year XXXX up
scale the part in into cost efforts. increased to attained Thanks our containment we've
our of in to higher we’ve basis maintained strong from continuing and adjusted shareholders ratio XXX efficiency improve repurchases. We points position capital Our $XX XXXX dividends return while efficiency period by same continues reduced million through our capital and half share first to to the over XXXX.
estate by slide X, real business commercial growth and increased our driven $X.XX GAAP to share in return were higher commercial our and fee to lending, Turning per income. earnings quarter second
lending. strong had share performance $X.XX acquisition had We the warehouse vertical and mortgage our also for earnings quarter. growth related costs general in were Huntington solid commercial per our Excluding in
commercial payoffs our a loan real the saw we outpaced estate increase in in estate a quarter. book real As production commercial anticipated we robust and modest
continued expect the over year. real of remainder the We commercial growth estate
helped pressure, our and to closed positions We both just period-end quarter Home portfolio mitigate which sold like points margin Huntington investment the interest interest XXX securities down managed transaction in These and advances increased by challenging checking positions savings second and the order branch in amount our and funding Federal net a We us we low-cost actively by aided actions almost deposits million. of margin funding million a of Loan June. in hold Bank paid rate In compression environment. our over despite XXX the to basis late X quarter.
banking We higher leaving in XXX driven increased, income capital $XX in of common stock markets repurchased mortgage million by our authorization. fees. fee Our million and income the quarter, current
from balances growth second for details the utilities Loan and increase commercial and driven business general X% our first was in by which and in quarter the are XX% warehouse our up mortgage lending loan led prior in the and the lending, from performance commercial both had quarter, on prior slide more Total increased year-over-year. from power was The solid vertical. we growth business and in specialty than X. by up quarter showed X% quarter
mortgage by new residential stable quarter. during were payoffs the as replaced RM was originations Our portfolio
this an assessment gas notice the of results declined that will vertical purposeful the in undertaken quarter. You oil loans over the of several have we was This last second months. and and
making and largely is predict. production industry harder more the upstream their the been Of valuation the markets reserves more intensive advent disposition dynamics With the technology, have of to capital capital late, industry, volatile new challenging. had the Drilling of are the rates and of changed. shut and to
these Given our levered our decreasing to have but portfolio remain borrowers. to higher de-risk business will active by the exposure chosen in realities, we
We we seek expect better reduce to exposure a return risk over of equation. as further year our gas the the rest oil and
slide planned oil comprises and and quarter, The has we and year the the expect gas last moderate despite left loans, from over X% the as can commercial a decline than of gas to portfolio Turning in only headwind so this you reduction. in X, see the grown lending in total the oil business book graph. less
lending lending guidance. Our will anticipate solid and that line overall year with remains increase balances in pipeline business the of we the commercial commercial through our and remainder
on discussed real and commercial quarter second growth portfolio. anticipated modest to pay-down we activity production calls, CRE outpaced in estate in previous As leading in the the
CRE pipeline to fully the slide year. loans remainder growth commitments quarter. X, are billion we'll show that with will the the end strong of positive CRE continue and anticipate of these remains XX% the at fund lending in commitments construction Almost that expect to over X.X our over Turning we we for of
slide our by on market to security began the positions lower of to a the stable a Visa to partial for We Class the to fair our yielding sheet. B billion reduced Turning of higher securities sold in the as institutional funds backed Losses cost, were our securities value taxable X, million our as in quarter mortgage portfolio by investment of securities down repositioning second quarter. environment. as balance use sales the securities, equity we X.X pay source our we declining shares some reflected increase and rate from XXX on first offset by of recognition reducing the funding
upon litigation. and expect XX,XXX hold Visa of final resolution We Visa the continue shares upside additional to B
adding as margin balance sensitive XX selling yielding million grew current build our securities last better defended lower higher from quarter. tax duration exempt book of rate positioned this municipal continued munies, sheet By we portfolio for mortgage to environment. we while net longer securities, and out by interest our backed a We pre-payments
we funding holding higher tax we'll our assets portfolio, from in anticipate taxable balance year. will securities quarter rather and securities portfolio targeting fourth exempt forward, an this XX% the overall to use total XX% cash paying stable. of our than continue that of this Going to the level this while cost run-off level We're flow reach reinvesting down the
to average were Turning million the up quarter. over from deposits slide XXX first X,
higher of We’re and time $X.X million focused investment deposit and by market FHLB we quarter, the runoff, Driven improved billion. network sales by balances funding quarter transaction, the by increased our during the security, and from aided reduced first our repositioning on checking deposits over XXX money along also we advances branch with and deposits mix. costs, savings transaction funds and low-cost end by our over from the Huntington
in deposits transaction quarter to funds. reduce the the our slide reduction FHLB cost advances to these higher continued Going network of and XX, sources in strategy long-term
low The and overall a savings resulted funding, mix our XX% any first at increase of cost up quarter lower With end XXXX. deposits the of reduction the had deposit second now from in XX% the loan-to-deposit at in since of is of higher quarter. checking represent which we've XX%, the cost of ratio end than
with loan-to-deposit margin the year, securities should flows position to significantly expected rate risk remainder despite mitigate later our improving the trend Fed this from compression expect us deposit relatively funding to going low margin the will and a cuts inflows, have of These forward downward ratio, and of stable year. seasonal For we our mix, along the inflows to portfolio. improve with cash further
lower Net income $X from interest Slide $XXX and decrease a income interest net Turning million discuss previous net XX, interest to The quarter, our from we interest was X first million, quarter. net several income. X.XX% factors. the points was our caused by down the of was margin basis
in the X and commercial On almost the basis first LIBOR asset impacting quarter, second yields. month negatively and lending quarter one from side, the points business average decreased CRE
the their and mortgage our accelerated portfolio. caused prepayments decreased, long-term to expected mortgage yield in calculation. servicing a customers income which reduction Additionally, This, in residential mortgages interest part refinance that's in turn, rates incented our of
will that to expect ahead, pressured compression and persisting be Looking by we LIBOR portfolio yields. lower continue yields mortgage asset
late came side, points despite X transaction. shifts liability positive cost Huntington the increased mix basis the On interest-bearing average quarter our the deposit with that
in quarter we be second the we cost of relieved will the over However, the by funding second the anticipate experienced half factors. year several pressures
closed of had Huntington only our quarter First, on second our the improved transaction results. consequently June, deposit impact late full we'll small benefit in receive a mix. The
loan-to-deposit enabling without us book low, up loan grow relatively remains paying our the to ratio for Second, funding.
the Third, to will rate Fed the securities quarter, allowing source index-based funding for to portfolio our reduce a us cut, any third biased which and further rate will higher-cost reduce funds funding to of remain be course toward finally, a And action deposits. costs. appears
lower deposit current benefit anticipate interest We an be had the even year. reached we without deposit we margin our believe infection rate anticipate the third of than deposit improve X.XX% of that Fed second costs from our the in quarter, levels the point by will have to costs Driven a cut. the second lower and over net costs, quarter half
seems cut now we that likely it may year, to more times X.X%. now the be margin year full As about XXXX expect this rates Fed two
Turning to Slide XX.
from to non-interest last quarter and quarter $X from over Second last was million The of the up $X due year-over-year. sales. million increase primarily income year million income loan $XX mortgage was banking
international driven the banking fees, commissions offset in higher anticipated previous and gains than second quarter account by by somewhat capital quarter. lower had versus revenue income. we Additionally, the These trading markets insurance were
$XXX $XXX in our continue income to will expect We be to million. full of noninterest year the range million
$X up driven from XX. and from Moving first Huntington expense expense was million transaction increase branch $X quarter. $XXX initiatives. million efficiency internal was the the of to of million severance by related to Noninterest other million The acquisition-related expenses Slide of $X
it's and the colleagues accomplishment Associated. years. Our at quarter, work testament in here the our of is adjusted a been ratio nine diligence the lowest to efficiency XX.X% in was over hard This
half controlling million. of guidance discipline, continued year the year Given expenses $XXX full to $XXX we're our in our million for to lowering success cost our a expectation range first of expense and at the
improve Additionally, exceed efficiency expect our we're efficiency full up improvement estimate confident now we adjusted year to for XXX and our points. ratio basis initial to will
bank's with our and remains related our metrics. oil to are XX, Slide items we credit detail and gas strong portfolio. recent excluding quarters, line the generally credit reassessment credit metrics On some quarterly quality quality of the our Overall, in
$XX impacted gas were in but were $XX in reassessment million which charge-offs $XX quarter to portfolio. from Net Specifically, our million and the the loans, increased million oil year-over-year. $XX million nonaccrual million second the with actions down coming $XXX quarter
charge-offs three Excluding quarter the items, previous second oil quarters. gas-related were with in line and the
to We will and fourth gas million problem with losses only quarter to representing the return but loans to the charge-offs elevated gas be quarter. level in typical more quarter the $XX and expect may a oil in in oil the loan in third decreased paid gas loans, again due credits workout $XXX quarter million, previous Potential X% through and total to non-oil unchanged loans three The at million aggregate allowance were problem end. for potential the decrease that three full quarters. the $X was The due from largely was in of essentially loans, process.
provision to $X still $X but quarter for in last $XX billion was million loan Our a up credit million, small book. from relation losses
While that portfolio. reserved in we risks we've our exposure, already continue de-risk and oil gas we against provided the for see and currently to
oil As such, be patterns we of our provisioning. believe within and manageable loan historical future losses and gas will normal
On update for our Slide XXXX. outlook XX, we
for expect in continue We half X% the will that will remain commercial modestly portfolio the growth believe grow XXXX. We C&I our year. to to and solid real X% estate growth second average of loan
compression, two Fed will rate our X.X%. full be net Fed approximately funds we LIBOR for margin and expect year interest expectations persistent Given now cuts
to revenues year-over-year. continue improve our We expect fee-based will
B increased to million our a up our a $XXX charitable portion quarter, the contribution improvement of of $XXX basis million, the from forecast benefit expense outlook of points. second also In for shares XXX ratio our we've by onetime adjusted received we lowered tax to our to class efficiency trust. Visa Given
rate Looking approximately year XXXX ahead, we our expect full XX%. tax to be
use discussed, we and view growing effective franchise we've capital. our of M&A nonorganic as efficient core activity of As previously means deposit an accretive, an
XX. and In Bancshares M&A in-market, summarized focused focus acquisition have Slide of Today's the we and of First opportunities, opportunities. on is is bank consistent strategy evaluating efficiency-driven on that Staunton announcement with
Oltmann Under three over First has a Staunton serving $XX in assets of of the Southern $XXX customers XXXX family grown million year has generation from Bank million stewardship, Illinois. XX assets today. First Staunton in National in rich history in in to
to process our Slide is branch our acquisition. boxes XX. We additional $XX as is two similar the first communities merger improve perspective, The with quarter are believe regulatory and serve transaction the Huntington Southern we XXXX. an will and transaction expect transactions priorities to customers. line in XX,XXX expand close on to Illinois Subject merger approvals, most the we've conversion cash. be our recently the the will begin density new and other done, pleased of the transaction checks From merger for branch highlighted Consideration our in as We this of in to institutions. million strategic all and this the scale into announce we in
The franchise. deal enhances our deposit core
Our from lower Staunton's deposit further will in benefit XXXX. deposit First mix costs
new We customer the a transaction whole allow products set base. also expect Staunton's to of bring to to First us
our trust, customers other did From time. realize not insurance, resulting we any about expect have and management operating perspective, expect While We've deliver frontline efficiencies. assumed meaningful to services to to over synergies, a from office rely to acquisition our cash combined revenue able organization and be back efficiencies. analysis on new the we'll savings branch XX% financial cost private operating banking, we
phased-in tangible accretion of fully we book less anticipate less than At share book years expect earnback using share Accordingly, and the X% value crossover X.X of tangible per value XXXX. in method. we closing, per dilution EPS than
of those open the up questions. comments, your all call with I'll for And
