Q4 2019 Earnings Call
Greetings and welcome to the Huntington Bancshares fourth quarter earnings Conference call.
This time, all participants are in listen only mode.
A question and answer session will follow the formal presentation.
Anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
As a reminder, this conference is being recorded.
I would now like to turn the conference over to your host Mark Muth director of Investor Relations.
Thank you welcome Mark Muth Director Investor Relations for Huntington copies of the slides will be reviewing can be found on the investor Relations section of our website Www dot Huntington Dot com.
Oh is being recorded and will be available as a rebroadcast starting about one hour from the close of the call [noise].
Presenters today are based on our chairman President and CEO exact Wasserman, Chief Financial Officer, a rich polling chief credit officer.
As noted on slide two today's discussion, including the Q1 I period will contain forward looking statements such statements are based on information and assumptions available at this time and are subject to changes risks and uncertainties, which may cause actual results to differ materially.
We assume no obligation to update such statements.
Our complete discussion of risks and uncertainties. Please refer to this lot and the material filed with the FTC, including our most recent forms 10-K 10-Q, an 8-K pilot I mean now turned over to Steve well start on slide three thanks, Mark and thank you to everyone for joining the call today as always we appreciate your interest and support we're pleased with our full year 20.
19 result, and the continued momentum across the bank, despite a challenging operating environment.
The full year, we were we reported earnings per common share of dollar 27 cents, an increase of 6% over 2018 return on average assets for 20 like team was 1.3% return on average common equity was 13% and return on average tangible common equity was 17% the back.
Good sheep record net income for the fifth consecutive year and positive operating leverage on an adjusted basis for the seven consecutive year, our balance sheet is very well positioned with robust capital liquidity and our comprehensive hedging strategy has reduced interest rate risk credit quality remained strong with 29 Gina.
Charge off at the low end of our average through the cycle target range, we remain prudent with their allocation of capital to ensure we were earning adequate returns and taking appropriate risks consistent with our aggregate muttered kilo risk profile.
What do you like Jean Marc the ninth consecutive year of an increased cash dividend coupling the dividend with $441 million of share repurchases. During the year, we returned over $1 billion to our shareholders in 2019, which represented a total payout ratio of 79%.
As we previously communicated on many instances our capital priorities are.
First the fund organic growth.
Second to support the cash dividends and finally, all other capital uses including the buyback and selective acquisitions. These capital priorities have not changed.
Now moving to the economy, we continue to see growth and our expectation for 2020 is what continued expansion consumers continue to perform well across our footprint with strong labor markets driving wage inflation and the 12 months ending November 2019, unemployment rates declined or remain the same in seven.
Team of the 20 largest m. assays and Huntingtons footprint states.
Job openings continue to exceed unemployment levels in the Midwest Oh prices continue to appreciate with especially solid increases in Michigan, Indiana and Ohio.
Additionally, consumer confidence in our region as generally stayed at the highest levels. Since 2000, the positive consumer sentiment is evident in the success of our consumer lending businesses.
Our home lending business achieved record mortgage originations were both full year 2019, and the 2019 fourth quarter, our auto finance business also achieved record originations in the fourth quarter and we expect another good year 2024, consumer lending businesses again, driven primarily by resident.
Total mortgage and auto finance.
Yeah, we have seen a slowdown in commercial loan activity consistent with the measured tone from some of our commercial customers economic uncertainty along with tight labor markets remain headwinds were more robust economic growth in our footprint.
Overall, Huntington is performing well with disciplined organic growth our customers are generally confident about their performance for 2020, and we share that confidence in our performance. We continue to see good traction in our new specialty lending verticals.
Corporate lending technology media and telecom, our practice finance area, which we announced as part of the 2018 strategic plan looking out to 2020, we proactively took actions in the fourth quarter to drive organic revenue growth reduce our future expense growth and increase our capacity for additional investment.
In our businesses and technology, we repositioned $2 billion of securities picking up approximately 70 basis points of yield on those securities. The rebalance resulted in $22 million of security losses on the in the fourth quarter.
On the expense side, we completed the position reduction of employees and announced the consolidation of 30 in store branches. Now these actions along with the disposition of other properties and the technology system Decommission resulted an unusual expense of approximately $25 million in the quarter our disciplined.
It's been allows for further investment in digital and mobile technology and enterprise growth initiatives going forward I'm confident in our positioning entering 2020.
Our colleagues are focused and executing our plans we are all aligned with our strategies of creating a high performing regional bank in delivering top quartile through the cycle shareholder returns.
Exactly will now provide an overview of our financial performance that thanks, Steve and good morning, everybody. It's a pleasure to be with you here on my first earnings call with Huntington.
Slides four and five provide highlights of our full year 2019, and fourth quarter 2019 results, respectively, many of which state Steve already touched on.
Fourth quarter results include approximately $47 million, a pre tax income impact or approximately three cents per share after tax from previously announced actions that were taken to better position the bank for 2020 , including the securities repositioning workforce actions and the pending in store branch closures, let's turn to slide six.
To discuss the key fundamental drivers behind the financial performance for the quarter.
Average, earning assets increased to $2.3 billion or two per cent compared to the year go quarter average loans and leases increased $1.3 billion or 2% year over year with balanced consumer and commercial loan growth.
Average commercial and industrial loans increased 3% from the year ago corridor and reflected the largest component of our year over year loan growth see an eye loan growth has been well diversified over the past year with notable growth in specialty banking asset finance and corporate banking, our fourth quarter commercial loan growth was below our expectation.
As a portion of deals we expected to close at the end of the year were pushed into 2020 and seasonal declines in line utilization at year end, where larger than normal.
Overall commercial activity continues to be restrained by economic uncertainty.
We continue to actively manage our commercial real estate portfolio around current levels with average CRB loans, reflecting a 2% year over year decrease driven by pay downs and refinancing activity consumer loan growth remained focused in the residential mortgage portfolio, reflecting robust originations in the second half between 19 average residential.
For mortgage loans increased 7% year over year as we typically do we sold the agency qualified mortgage production in the quarter and retain jumbo mortgages and specialty mortgage products.
Now turning to slide seven.
Average total deposits decreased less than 1% year over year, while average core deposits increased 1% year over year note that both of these growth rates were negatively impacted by the June 2019 sale of the Wisconsin retail branch network, including approximately 725 million or almost 1% of core deposits.
We continue to see a migration and deposit balances from Cds and savings into money market accounts, reflecting shifting customer preferences, and we're focused on where we are focused on promotional pricing.
[noise] average money market deposits increased 9% year over year, while savings decreased 9% and core Cds decreased 16%. We expect this dynamic to continue in 2020.
Average non interest bearing and interest bearing DDA accounts, each increased 1% year over year.
Shown on slide slide 32 in the appendix, we're very pleased that our commercial noninterest bearing deposits increased 5% year over year on the corridor.
This growth highlights our continued focus on growing our low cost deposit base through new customer acquisition and relationship deepening.
Moving now to slide eight.
F T E net interest income decreased $55 million or 7% versus the year ago core primarily driven by the 29 basis point decline net interest margin, partially offset by 2% increase in average earning assets.
Net interest margin was 3.02%, 3.12% excuse me, 3.12% for the quarter down 29 basis points from the year ago quarter down eight basis points linked quarter and in line with the guidance. We provided the Goldman Sachs Conference in December moving to slide nine our core net interest margin for the fourth call.
There was 3.08.
Percent down 26 basis points from a year ago quarter.
Purchase accounting accretion CRIP, but contributed four basis points to the net interest margin in the current quarter compared to seven basis points in the year ago corridor Slide 28 in the appendix provides information regarding the actual and scheduled impact or Firstmerit purchase accounting for 2019 and 2020 .
Please note that this quarter is the last quarter, we intend to provide core NIM and P.A. breakouts as the P.A. is expected to have a relatively immaterial impact and 2020 [noise].
Turning to asset to earning asset yields.
Our commercial loan yields decreased 52 basis points year over year consumer loan yields decreased eight basis points and security yields decreased 16 basis points. The decrease in our earning asset yields can be primarily attributed to lower interest rates. Following the three federal reserve rate reductions that occurred during 2019.
On the funding side of the balance sheet, our deposit costs continue to move lower.
Cds and money market promotional rates repriced, lower and we actively manage commercial deposit costs total interest bearing deposit costs of 87 basis points for the quarter were up 3% year over year, So down 11 basis points sequentially [noise].
Slide 10 summarizes the actions we've taken to reduce the unfavorable into impacts of interest rate volatility and the lower interest rate environment, our hedging strategies reduce the downside risk from lower interest rates and have significantly narrowed the band of modeled outcomes for net interest income our current into.
Straight risk modeling suggests little change to net interest income from either a 25 basis point increase or 25 basis point decrease in 2020 .
We continuously monitor and we'll continue to prudently refine our interest rate risk management as the interest rate environment balance sheet mix and other factors necessitate.
The graph on the bottom left of the slide detailed the mix of our loan portfolio as well as the significant consumer deposit balances with repricing events in the first half of 2020 .
These repricing events provided an opportunity for the bank to reduce the cost of deposits as these higher price Cds and promotional money market accounts repriced lower.
Through December the consumer deposit repricing activity is on track with our expectations.
The success of our consumer deposit repricing and retention has provided us the ability to remain more disciplined in our commercial deposit pricing, particularly among the highest cost deposits. The graph on the bottom right of the slide displays the impact of our actions you can see the downward trajectory of our total interest bearing deposit costs by month. So.
It's July .
We expect this trend to continue given the significant deposit repricing opportunities that remain in the first half of 2020 .
Turning to slide 11, you can see it provides the detail our non interest income, which increased 13% from a year ago quarter. The growth was highlighted by mortgage banking income, which increased 152%, primarily reflecting higher higher saleable origination volume and secondary.
The market spreads as well as a $12 million increase in the gain on net mortgage servicing rights risk management.
We also continued to see steady growth in carbon payment processing income Trust investment management and insurance [noise].
In the 2019 fourth quarter, we repositioned $2 billion of securities picking up approximately 70 basis points of yield on the securities prospectively at a cost of $22 million in Q4.
While negatively impacting fourth quarter results the prospective earnings pick up and the earn back on the positioning losses are very attractive and consistent with our active management of the securities portfolio. The year ago quarter. In 2018 included $19 million of securities losses from similar repositioning.
Slide 12 provides the components of the 1% year over year decrease in noninterest expense.
The 2019 fourth quarter included $25 million of expense related to the actions, which Steve discussed earlier, while the year ago quarter included $35 million of similar branch and facility consolidation related expense.
Adjusting for these items noninterest expenses were essentially flat.
We continue to drive efficiency in our core expense base to ensure robust and growing investment capacity to fuel our investments in digital mobile and cyber technology enhanced products and services and distribution capabilities. This disciplined expense management allowed us to achieve positive operate operating leverage on an adjusted basis for the.
Seventh consecutive year.
Slide 13 illustrates the continued strengthen our capital ratios the tangible common equity ratio or TC ended the quarter at 7.88% up 67 basis points from a year ago.
And common equity tier one ratio RCG, one ended the quarter at 9.88% or 23 basis points year over year cutting them as CPT one to the high end of our 9% to 10% operating guidelines.
During the fourth quarter of 2019, we repurchased 13.1 million common shares at an average cost of 14.9 $6 per share or a total of $196 million.
Plan to use the share repurchase to manage our capital following the Cecil implementation back to a CPT one level near 10% by the end of 2020 , excluding the benefit of the Cecil transition provision provided by the Federal reserve, we feel managing internally to a C. One level, excluding the three year transition.
Reinforces our commitment to maintaining strong capital ratios, which we see as a position of strength for the organization.
As a result, we are currently planned to repurchase less than a third of the remaining $249 million of share repurchase capacity on our 2019 capital plan in the first half of 2020 .
Now, let me turn it over to rich to cover credit, including Cecil cabbage. Thanks, Zack Slide 14 provides an update on our seasonal adoption.
We estimate our allowance for credit losses are Hcl will increased 44% from the year end 2019, Hcl to 1.28 billion or 1.70% of total loans and leases on an adjusted basis as we stated on the third quarter call given our 50% mix of relatively longer dated consumer loans, the Cecil lifetime lost methodology.
Results in a higher allowance than the prior methodology. The increase in reserves is largely related to the consumer loan portfolio.
As we move forward under Cecil It has a new accounting standard with many variables our day to allowance for credit losses will be determined using various models and incorporate multiple scenarios historical loss in recovery rates borrower characteristics and other factors as a result, we expect more volatility in our quarterly provisioning expense.
Our parallel testing however indicates that key factors being held constant the aggregate annual level of provision expense is not expected to materially changed from the current incurred loss methodology, despite that higher quarterly variability.
Slide 15 provides a snapshot of key credit quality metrics for the quarter. Despite challenges in our oil and gas portfolio, our credit metrics remained strong.
As we've noted previously some quarterly volatility is expected given the absolute low level of problem loans.
Consistent prudent credit underwriting is one of Huntingtons core principles and our financial results continue to reflect our disciplined approach to risk management and our aggregate moderate to low risk appetite.
Net charge offs remain near the low end of our average through the cycle target range of 35 to 55 basis points net charge offs represented an annualized 39 basis points at an average loans and leases in the current quarter led to the prior quarter and up from 27 basis points in the year ago quarter. The increase was centered on the.
Oil and gas portfolio, which made up approximately half of the total commercial net charge offs.
This portfolio was primarily impacted by geological issues compounded by low commodity prices and limited capital markets activity.
We have a relatively small oil and gas portfolio, representing less than 2% of total loans and we believe we have it appropriately reserved for.
Consumer charge offs have remained fairly consistent over the past year, there's additional granularity on charge offs by portfolio and the analysts package on the slides.
Annual net charge offs, excluding the $67 million of oil and gas related losses were 26 basis points, and just 15 basis points for the commercial portfolio.
The nonperforming asset ratio increased two basis points linked quarter, and 14 basis points year over year to 0.66%.
Again, primarily as a result of the stress in our oil and gas book.
Allowance for loan and lease losses as a percentage of loans remained relatively stable at 1.04% down one basis point versus the linked quarter.
I'll turn it back over to Zack.
Thanks, Rich slide 16 illustrates our expectations for full year 2020 , we expect 2020 to be another year of sustained organic growth as we continue to execute and invest in our core growth strategies. We expect full year average loan growth in the range of 3% to 4% continued growth in both consumer and commercial portfolio.
Yes, we expect growth, we modestly stronger on the consumer side focused and home lending auto finance, we expect slightly more measured commercial loan growth consistent with recent economic data.
Well you're out of an average deposit growth was expected to be approximately 3% to 4% as we remain focused on acquiring for checking accounts and deepening customer relationships, specifically, our expectation entails continued decline in Cds more than offset by growth in checking and money market.
We expect full year total revenue growth of 1.5% to 3.5% on a GAAP basis with growth in both net interest income and non interest income.
We are projecting the NIM to rebound in the first half of 2020 from nine from the 2019 fourth quarter before stabilizing in the second half of the year.
Given our relatively neutralized interest rate risk positioning we remain confident in our outlook for net interest income growth while deposit pricing remains rational in our markets. We are closely watching the competitive environment around rate and volume of deposits. As this represents the primary risk and opportunity for variance to our NIM forecast, we expect non.
Interest income on a GAAP basis to grow at a slightly higher pace than total revenue in 2020, driven by the continued focus on deepening customer relationships.
Full year non interest expense is expected to increase 1% to 3%.
Based on our active management in 2019, we're comfortable with our current expense base and the run rate trajectory. Our focus is on driving continued investment in opportunities to further differentiate Huntington and drive revenue growth as we've told you previously and are demonstrating with our actions and our 2020 guidance, we remain committed to targeting annual.
Oh positive operating leverage.
We anticipate that the full year 2020 net charge offs will be within a range of 35 to 45 basis points.
As rich just covered fundamentally our credit remains strong we're taking decisive action to mitigate the risk in our oil and gas portfolio. As a result, we have expectations for oil and gas charge offs remaining slightly elevated in the first half of 2020 .
These charges are fully represented in our 2020 guidance. We believe we were adequately reserved at year end.
And with the life of loan Cecil adoption.
Our expectation for the effective tax rate for the remainder of the year isn't the 15.5% to 16.5% range.
Operator, we'll now take questions, we ask that as a courtesy of your peers. Each person ask only one question and one related follow up and then if that person has any additional questions he or she can add themselves back into the queue. Thank you.
Thanks at this time, we will be conducted a question and answer session. If you would like to ask your question. Please press star one on your telephone keypad confirmation tomo indicate your line is in the question Q.
In the press Star too if you would like to remove your question from the Q.
Okay. Thank you think speaker equipment, it may be necessary to pick up your hands up before it presents dark he's one moment, please while we pulled.
Thank you. Our first question comes from the line of Jon Arfstrom with RBC. Please proceed with your question.
Thank you John .
Hi, good morning.
Well lots to ask about but I'll, just maybe start Steve with just you talked a little bit about headwinds in commercial.
But we do have u_s_m_c in phase one trying to seemingly Don.
Just curious if you could give us a little bit more color on that and if you're seeing any changes in optimism at all from the commercial customers.
John It.
U_s_m_c has just recently done and obviously there are other issues distractions gone on a DC right now so I.
I don't think Theres, a meaningful change at but from what we reported at the prior conference and.
I do I do expect theres going to be a second half optimists lift I'm optimistic in that regard, but I think it's going to be a little little hesitant little reluctant and talking with different customers about.
The start of this year, we did see more cash on balance sheets at the end of the year so spot balances.
We're.
Were down a bit from where we expected them to be that was particularly true in auto.
As customers kept more cash on on on on sheet. So I think that's just reflects this conservativism and just sort of.
A wait and see approach.
Again in the Midwest were hampered by lack of of labor. So that is an element and this planning process as well as these uncertainties.
Okay. That's helpful.
And then just one more is accurate rich.
Maybe rich for you just can can you.
Talk about the due to seasonal impact again I think what you said is expect to provision to be roughly the same in 2020 compared to 2019 I Wonder what are you heard that right.
Carl you want us to think about provisioning earned 2025, yeah. This is rich.
You know the the testing that we've done and again this is new so we're kind of going through quarter by quarter.
The testing that we did.
See sold to to be a you showed that there were some quarterly volatility, but over the course of the year.
It tended to level itself out so we don't see a lot of volatile we see more volatility on a quarterly basis going forward, but we don't expect a material change and.
The overall provision under Cecil than we had under the herd lost method uptick.
Okay.
That's helpful. Thank you.
Thanks.
Our next question comes from the line of David Long with Raymond James. Please proceed with your question.
Good morning, everyone.
Morning.
With your revenue outlook for the year, what is the rate backdrop that you are assuming right now.
So this exact I'll take that question, David talked with them, but were essentially assuming the forward yield curve as that existed in November although it's relatively consistent with where it looks right now.
The fed funds expectation is relatively neutral I think the the actual full rate look at it precisely included a forecasted one rate cuts sort of in the late summer time period, but I think as we noted in the prepared remarks.
Based on our hedging program our net interest.
Income NIM is essentially neutralize from one rate increase or one rate decrease from today. So I would say sort of taking a step backs or roughly flat from where we are today.
Got it and if the if the rate Backtrack goes against you do you have additional levers that you can pull on the expense side. So you can still produced positive operating leverage.
Yes, we do I think under most realistic rate scenarios as I mentioned, the hedging program, we'll keep our NIM pretty constant so we're not expecting how to pull those expense numbers, but as always we do have a number of expense levers that we've got at our disposal you know all ticked down a few of them. We can always look at the pacing and.
Phasing of our strategic growth initiatives.
We've got the number one branch share in Michigan, and Ohio, and so looking at our branch network and the costs around.
He is an opportunity.
You know what I think generally as we see a revenue soft than we typically see truck in just the linked variable expense reduction from compensation tend to mitigate and offset that so.
Those are the levers we've got our as well that we'd look at all the time there are other levers like staffing contingency plans, which you saw us pole in in the fourth quarter of 2019, which are out or disposal, but again, it's not our expectation that will have to do that in 2020.
Bluffing I'll just say is you commented powders and positive operating leverage we are.
Managing and expecting to generate positive operating leverage in 2020 .
Got it appreciate the color. Thanks.
You're welcome.
Our next question comes from the line of John Pancari with Evercore. Please proceed with your question.
John .
This would also.
Yes, John .
Just have a two part question on your on lending business considering that one of the biggest flares in auto lending is now becoming more active in this space are you seeing pressure on pricing or your ability to grow auto loans at the piece that you had previously expected and then the second part is tied to Cecil.
Cecil implementation impact your appetite for auto loans going forward just trying to gauge you know, what's your 2020 auto loan growth outlook. Following a flattish average balance in 2019.
Yes, John it's rich I'll take that so you know as I'll take the second question first as it relates to see so the auto business is really neutral the weighted average life of our typical auto alone.
It's not that much different than what we have under the incurred loss methodology. So it's a fairly benign impact from a seasonal standpoint as it relates to the overall business strategy I think we have just tremendous franchise across.
Multiple states with thousands of dealers that we've got the ability to.
Drive volume I think we are in a a very high FICO band that tends to be more price sensitive than than others. So I don't see us having any real issues and meeting the origination goals that we've got from the indirect auto business and 2020.
Okay.
And then last quarter I believe you'd indicated that the the consensus NIM estimate around that time, you know 320 for full year 20, what's reasonable, but I believe that you had assumed here a couple of causing that 2020, a NIM guidance.
Could you just you know just got your updated thoughts I know you've talked about.
Rebound in first half and then stable, but are you still comfortable but that's the 20 levels right now.
Thanks for the question. This is Chuck I'll answer that one so the the answer is yes, we are still comfortable with the approximately 320 guidance that we talked about in in December of the Goldman Sachs Conference and then just reiterated today in the prepared remarks, we expect that the trajectory of that to be ticking higher into the first quarter.
We're sort of stabilizing around that level by mid second quarter, and then oscillating around that level through the balance of the year. There's really a couple of big drivers of that so the most substantial of which is the repricing of the deposit maturities that we talked about in the prepared remarks, there is roughly $5 billion repricing.
Q1, another $4 billion repricing in Q2, and so far we're really pleased with both the retention and the pricing on that which is proceeding according to our plans. The other factor it was a little smaller but still it helpful is the 70 basis points of pickup we got on the securities repositioning that we discussed earlier.
Lets you factors whats driving driving that and.
And helping us to to get the NIM to back to 320 with that being said, there's a couple of factors were watching.
Asset yields on new production all your previous questioner on auto in residential we we continue to see them, where we want them, but there is something we look at very carefully the other one is.
As I mentioned in my prepared remarks, the volume in the rate for the deposit costs again, what we're seeing.
The trend on our expectation, but it's something that we'll continue to watch those are the biggest factors that could cause them to be higher or lower than that 320.
Okay, and I just want a clarify one thing that is assuming a cut cut and a in the summer this year.
Yes, it's a suit assuming this is exactly essentially the forward rate curve that exists in November as I mentioned, which if you look precisely at the fed funds expectation that had one cut over the late summer time period, but even if it's flat we're going to be or roughly.
Okay perfect. Thank you.
As a reminder, if he would like to ask a question press star one on your telephone keypad.
Our next question comes from the line of Ken used in with Jefferies. Please proceed with your question.
Hey, Thanks, guys. Good morning, one more question on that.
Good morning, one more question on the on the deposit side of things see what you're expecting for total growth I'm, assuming that's still coming from core customer growth you mentioned.
The 5 billion, that's going to reprice underneath that can you just talked about what's happening in your markets as far as just underlying core deposit pricing and if that's still also coming down aside from what you're just no scheduled there's going to reprice from the rollovers.
Yeah, I mean, I think we're as I said, what we're seeing the repricing activity be pretty much in line with our expectations.
Ticking down of but also being somewhat competitive so weve assumed and plan for the rate environment. We've got right now and we're seeing it trending that way.
Yeah, Ken This is mark I would say that generally what we're seeing on the consumer side is very rational.
And as we would have expected.
And the repricing coming in both with better pricing and better retention has allowed us to then be a little more aggressive on the commercial side, which we do see is more competitive if you were to point to.
To some of the competitive issues out there definitely is on the commercial side in particular with your large dollar deposits on the commercial side and we've just allowed some of those to leave the bank as a result of the success, we are having on consumer side.
Got it Okay and then one more question just on the mix of the balance sheet.
With pretty good loan growth in pretty good deposit growth.
What do you see happening in terms of both the size secure <unk> securities portfolio and can you talk about the underlying dynamics of in a stable rates environment. Your front book back book.
So the expectation for the securities portfolios as Zach.
Roughly costs of war today, no material change, we like where that and.
That's the expectation at this point the second part of the question was.
Back book.
Oh, it rolling off securities enrolling on how or if if rates stay low for stay where they are from here, what's the dynamic happening in there. Thanks.
Let's take that offline it will have that detail right in front of me Yeah, I cant I've got that downstairs, a a follow up with you on that.
Okay. Thank you guys.
Thank you.
Ladies and gentlemen, we have reached the end of the question answer session I would like to turn the call back to Steve's dynamic for closing remarks.
I'm pleased with our 2019 performance, particularly given the environmental challenges. We faced are active management position. The bank continued to execute on our strategies and I'm confident about our prospects for 2020, our top priorities are executing our strategic plan and thoughtfully investing in our businesses for continued prudent organic growth.
While delivering annual positive operating leverage we are clearly building long term shareholder value through a diligent focus on top quartile financial performance and consistently disciplined risk management and finally, we always like then with the reminder to shareholders Theres a high level of alignment between the board management.
Colleagues and our shareholders. The board in our colleagues are collectively a top 10 shareholder of Huntington and all of US are appropriately focused on driving sustained long term performance. So thank you for your interest in Huntington have a great day.
This concludes today's conference you may disconnect your lines at this time. Thank you for your participation.