Huntington Bancshares Inc.’s acquisition last year of Detroit-based TCF Financial Corp. created the second-largest bank operating in Michigan for deposit market share and with more branch offices than any other bank. The Columbus, Ohio-based Huntington, which also now ranks among the 20 largest banks in the U.S., has since worked to integrate TCF.
The bank also seeks a new regional president in West Michigan following the March departure of Krista Flynn to PNC Bank. MiBiz spoke with Huntington Bancshares Chairman, President and CEO Stephen Steinour about the merger and the bank’s role in the market.
What’s the status of the integration of the TCF franchise?
The biggest part of this is winning the hearts and minds of colleagues. There’s a mechanical piece of getting the systems converted, and that was done in the fourth quarter. We’re a larger company and colleagues don’t get to vote on matters like, ‘Do you want to do a combination?’ So, it’s up to us to get out and be with them and to share what our plans are and what we hope to achieve together. It’s much more challenging in a COVID environment to do this, but now that things have opened up again, it’s great to be with them.
How is Huntington now positioned today in the Michigan market?
Michigan is a very important market to us. It’s a very significant market. When I think about the core of the franchise, by far the biggest two markets we’re in are Ohio and Michigan. We started investing in 2010. The auto companies’ bankruptcies were, I think, a low point for the state along with 14 percent unemployment. But we were very optimistic at the recovery, and so we’ve been putting capital to work. We’ve added a tremendous amount of new colleagues over the years and we’ve been able with TCF to get a leading branch share by a lot in the state. There’s still an opportunity for us to keep growing in Michigan, and we will look to do so.
We have a community plan and a big commitment in that plan is to Michigan. We have a minimum of $5 billion over the next four-plus years that we’ll be putting to work in Michigan and that will be an economic multiplier.
There’s a tendency after bank mergers for employees to look at new opportunities and we’ve seen some movement in the market since the merger. How’s talent retention gone post-merger?
Challenged in some markets. Challenged, certainly, in Grand Rapids, but then in other markets it’s been outstanding. The combination of Talmer and Chemical (in 2016), followed by Chemical and TCF (in 2019), then followed by TCF to Huntington, back to back to back — there’s a lot of extra work and burden for colleagues when you go through these sorts of transitions. Same with our customers. So, we have to really reach out to our colleagues and to our customers, and we’re trying to do that in a very significant way as we move forward.
How’s the search going for a new West Michigan regional president?
We have a couple of internal candidates. Whenever we have a turnover … we always look both internally and externally. We’re in that process now. We’re anxious and eager to get the right person in place in Grand Rapids.
How does Huntington see the Michigan and Midwest economies performing through 2022?
The Midwest, I think, is going to do very, very well. Part of what we’re seeing globally now with this bipolarization as a consequence of the Russian-Ukraine tragedy and the invasion, is a lot of continued reshoring and onshoring, and supply chain disruptions are causing realizations that geographic proximity is an important part of the equation. I think Michigan’s going to do fabulous and the Midwest will as well … especially West Michigan.
Here in Columbus, we announced this Intel chip plant (in January), and Patrick Gelsinger, the CEO of Intel, said this is ‘Silicon Heartland’ — it wasn’t Silicon Columbus. This will be a big deal for Ohio and Michigan and the Midwest.
How high do you expect interest rates to go over the next couple of years?
You better ask (Federal Reserve Chairman) Jerome Powell that, but there’s a clear direction. I worry about inflation. I had a call with our regional advisory board members and there was a comment about how significantly they’re having to raise compensation.
How does a rising rate environment affect your commercial lending?
We’re coming off of an all-time low, and a forever all-time low in the country. If rates go to 3 or 4 percent, if you roll the clock back seven, eight, or 10 years or before — and I’ve been at this for 40 years — that’s a pretty good rate. So, it’s all a matter of perspective.
(In West Michigan) there’s resilience and opportunity there. I’m very bullish about businesses working through this round of rate increases.