Huntington commits to $40 billion community plan, with $1B for Detroit and Wayne County
On the heels of Huntington Bancshares Inc.'s merger last week with TCF Financial Corp., the newly combined bank detailed a new $40 billion national community plan — $11 billion of it for Michigan and $1 billion for the city of Detroit and Wayne County.
Banking executives, local government officials and community leaders announced the new plan Wednesday at the Aretha Franklin Amphitheatre on Detroit's riverfront.
Huntington leaders said the new plan is aimed at addressing social, racial, economic and environmental inequities across its multi-state footprint. The bank is adding $40 billion to fund its community plan, an amount that CEO Steve Steinour said was the bank's largest commitment ever. The plan represents an increase of about $5 billion in new funding above the historical lending and investing of Huntington and TCF, according to a news release.
The plan will focus on affordable housing, small business loans and providing better access to capital to low- to moderate-income and historically disadvantaged communities. Needs that the plan aims to meet were identified via meetings with 400 community organizations across Huntington's footprint, the bank said.
The new strategy, which went into effect this month and covers the next five years, replaces the $20 billion community plan Huntington announced last year, which had included $5 billion for Michigan. The merger with TCF enabled the organization to increase its planned investment, executives said.
"Far too many people across our great nation, and certainly in this city, continue to experience inequities in various forms," Steinour said, noting that the COVID-19 pandemic has exacerbated those issues.
“We’re here in Detroit because it’s especially important for us to be a force here in Detroit, Wayne County and southeast Michigan," he added. “As a growing bank dedicated to looking after people, we recognize that we have a responsibility to improve economic opportunity for those we serve.”
Huntington plans to adopt an affordable housing and consumer lending goal of $24 billion, with $12 billion of that total earmarked for minority and "under-resourced populations," according to the release.
The bank also plans to allocate $16 billion for minority borrowers and communities as part of its racial and social equity initiative.
It will expand its small business lending programs with a $10 billion commitment over five years, $2 billion of which will focus on lending to minority-owned businesses or businesses operating in majority-minority communities.
And Huntington said it would commit $6.5 billion in loans and investments "to enhance programs and services that foster equity in areas including but not limited to affordable housing, small business financial and community services that provide food security, financial empowerment and workforce development," according to the release.
Huntington over the next several months will have discussions with a "cross-section" of leaders to develop specific initiatives to tackle environmental health challenges in under-resourced communities.
How exactly the plan's funding will be used will be determined at the local level, executives said.
Huntington last week completed its $22 billion all-stock merger with Detroit-based TCF. The combined company is co-headquartered in Columbus, Ohio and Detroit. The bank's commercial banking business will be here in TCF's 20-story building on Woodward and Elizabeth Street.
The combined company has about $175 billion in assets, $142 billion in deposits and $116 billion in loans based on March 31 balances, The Detroit News previously reported. Huntington has more than 1,100 total branches. The U.S. Department of Justice required TCF to sell 14 of its Michigan branches, all outside metro Detroit, prior to the completion of the merger.
Executives and elected officials cast the investment as further proof of Huntington's commitment to Detroit. Mayor Mike Duggan acknowledged that when he first learned of plans for the merger, he was concerned that it would mean an abandonment of Detroit.
"If you know the history of Detroit, every time there's been a bank merger and they say, 'Don't worry, Detroit is going to be fine,' Detroit has gotten the short end of the stick," he said.
But, he said, "building Huntington’s co-headquarters in Detroit and furthering support of the region with another $1 billion pledge to the city and Wayne County is evidence of the bank’s deep-rooted commitment to our residents, businesses and communities."
The event also featured remarks from Wayne County Executive Warren Evans, the Rev. Wendell Anthony, president of the Detroit branch of the NAACP, who lauded the community plan as "a big economic deal" for the city and county, and Gary Torgow, previously chairman of TCF and now a Huntington chairman.
“The world has changed dramatically since the Queen of Soul first sang ‘Respect’ in 1967, and yet the dramatic events we have endured over the last year have shown us how much further we must travel to address systemic racism and bias," Torgow said.
"What Huntington Bank is doing today through this announcement is precisely what banks and corporate America must do to stand up, to be counted, and to do at least their very best to help right the many wrongs that banks such as ours are capable of doing."