A year ago, there's no way Huntington Bancshares Chief Executive Stephen Steinour could have gotten away with delivering a presentation that relegated credit-quality issues to slide number 20.
But at a Wednesday Goldman Sachs investor conference, Steinour was among the most aggressive of a group of regional bank executives arguing that their companies are differentiated enough to achieve normal growth in an economy that hasn't. Along with the executives of Comerica Inc., and U.S. Bancorp, Steinour argued that a partial near-term economic recovery was sufficient for his bank to again achieve increased loan volume and steady profitability.
"Huntington is becoming a growth company, we are breaking away from the competition," he said, describing its efforts to boost out-of-market auto dealer lending along with its investments in a retail banking revamp that includes extended hours, a recent grocery store branching deal and a nine-week old customer service push based on Huntington's "fair play banking philosophy."
Part of Huntington's and Comerica's optimism stemmed from improvements in key markets. "The auto zone that was hit very hard is night and day different," Seinour said. But both companies' pitch to investors was premised on their ability to isolate themselves from broader industry woes — and competition.
"We have good competitors in all of our markets, but we have our niches," Steinour said.
Comerica CEO Ralph Babb argued that the transplanted company's relatively robust business in the Southwest wouldn't be worn down by newer entrants.
"You don't go into C&I lending overnight. … It's not unusual to have competitors move into a growing market like Texas, but the competition is rational."
Not every presenter was so sanguine. While couching their comments in broader industry trends, First Horizon National Corp. and Regions Financial executives claimed success in their respective years-long efforts to refocus their businesses, but said that seeing the payoff would require patience.
"As a result of slow growth, in all likelihood we expect to see a tremendous amount of competition," said Bryan Jordan, First Horizon's CEO. "We are looking to put money to work, but the number of strong borrowers is more limited in this part of the cycle and so the competition does seem to be very strong for those."
A joint presentation by KeyCorp Chairman and CEO Henry Meyer and his named replacement, Chief Operating Officer Beth Mooney, struck a middle ground.
"Yeah, enthusiasm isn't what I would call the buzzword in loan demand right now," Mooney told one analyst, though certain geographies and business lines have picked up.
"So we are probably, in about a third of our markets, starting to see some systemic loan demand," she said.
Also on the conference schedule was U.S. Bancorp CEO Richard Davis, who dedicated much of his talk to subjects beyond the company's current position.
"I like our scale, I like our size, I like our customers, I like our markets," he said.
Instead, Davis focused on the challenge of grappling with Basel III capital standards, arguing that uncertainty over the final rules was a drag on his bank and its peers.
"We still need to get some amount of clarity," Davis said, though he added it appears likely that Basel will have more of an impact on the substance of the banking industry than the Dodd-Frank legislation will.
While promising the sudden and dramatic return of dividends has recently been a favorite applause line for the CEOs of healthy banks, Davis struck a more muted tone on the subject. In the interest of conservatism, he said, U.S. Bancorp does not intend to push the envelope when it finally gets clearance to increase its dividends. Regulators have suggested that 30% of earnings is as much as they'd want being paid out, Davis said, "so I'm not going to pick a number that's too high and be wrong."
"Next year will not be the year where all of us have finished our recovery from our loan losses," he said.
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