TFC - Huntington Bancshares downgraded at Wolfe on expected higher funding costs

Wolfe Research analyst Bill Carcache downgraded Huntington Bancshares (NASDAQ:HBAN) to Underperform as he expects banks that are running low on liquidity to face relatively higher funding costs and deposit betas. "Although we maintain a cautious stance on Mid-Cap Banks and expect further multiple compression based on our view that a recession is likely, we see value in overweight highly liquid Mid-Cap Banks that have effectively managed their balance sheets versus those that have already fully deployed their liquidity, will have to raise more expensive funding, and are more likely to experience higher deposit betas," Carcache wrote in a note to clients. Banks that have effectively managed their balance sheet are M&T Bank (MTB), Cullen/Frost Bankers (CFR), Comerica (CMA), PNC Financial (PNC) and Zions Bancorporation (ZION), he said. Those that have fully deployed their liquidity include Huntington (HBAN), KeyCorp (KEY), Prosperity Bancshares (PB), Citizens Financial Group (CFG), and Truist Financial (TFC).

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Huntington Bancshares downgraded at Wolfe on expected higher funding costs