HUNTINGTON BANCSHARES INC /MD/ - FORM 8-K - EX-99.3 - EXHIBIT 99.3

Attached files

file	filename
8-K - FORM 8-K - HUNTINGTON BANCSHARES INC /MD/	c15708e8vk.htm
EX-99.2 - EXHIBIT 99.2 - HUNTINGTON BANCSHARES INC /MD/	c15708exv99w2.htm
EX-99.1 - EXHIBIT 99.1 - HUNTINGTON BANCSHARES INC /MD/	c15708exv99w1.htm

Exhibit 99.3

HUNTINGTON BANCSHARES INCORPORATED
Quarterly Financial Review
March 2011

Table of Contents


Quarterly Key Statistics			1 - 2

Consolidated Balance Sheets			3

Loans and Leases Composition			4

Deposits Composition			5

Consolidated Quarterly Average Balance Sheets			6

Consolidated Quarterly Net Interest Margin Analysis			7

Selected Quarterly Income Statement Data			8 - 9

Quarterly Mortgage Banking Income			10

Quarterly Credit Reserves Analysis			11

Quarterly Net Charge-Off Analysis			12

Quarterly Nonaccrual Loans and Leases (NALs) and Nonperforming Assets (NPAs)			13

Quarterly Accruing Past Due Loans and Leases and Accruing Troubled Debt Restructured Loans			14

Quarterly Common Stock Summary, Capital, and Other Data			15

Notes:

The preparation of financial statement data in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect amounts reported. Actual results could differ from those estimates. Certain prior period amounts have been reclassified to conform to the current period’s presentation.

HUNTINGTON BANCSHARES INCORPORATED
Quarterly Key Statistics⁽¹⁾
(Unaudited)


	2011			2010						Percent Changes vs.
(dollar amounts in thousands, except per share amounts)	First			Fourth			First			4Q10			1Q10

Net interest income	$	404,330		$	415,294		$	393,893			(3	)%		3	%
Provision for credit losses		49,385			86,973			235,008			(43	)		(79	)
Noninterest income		236,945			264,220			240,852			(10	)		(2	)
Noninterest expense		430,699			434,593			398,093			(1	)		8

Income before income taxes		161,191			157,948			1,644			2			9,705
Provision (benefit) for income taxes		34,745			35,048			(38,093	)		(1	)		N.R.

Net income	$	126,446		$	122,900		$	39,737			3	%		218	%

Dividends on preferred shares		7,703			83,754			29,357			(91	)		(74	)

Net income applicable to common shares	$	118,743		$	39,146		$	10,380			203	%		1,044	%


Net income per common share — diluted	$	0.14		$	0.05		$	0.01			180	%		1,300	%
Cash dividends declared per common share		0.01			0.01			0.01			—			—
Book value per common share at end of period		5.42			5.35			5.13			1			6
Tangible book value per common share at end of period		4.74			4.66			4.26			2			11

Average common shares — basic		863,359			757,924			716,320			14			21
Average common shares — diluted⁽²⁾		867,237			760,582			718,593			14			21

Return on average assets		0.96	%		0.90	%		0.31	%
Return on average common shareholders’ equity		10.3			3.8			1.1
Return on average common tangible shareholders’ equity⁽³⁾		12.7			5.6			2.7
Net interest margin ⁽⁴⁾		3.42			3.37			3.47
Efficiency ratio⁽⁵⁾		64.7			61.4			60.1
Effective tax rate		21.6			22.2			(2,317.1	)

Average loans and leases	$	38,097,210		$	37,800,546		$	36,979,996			1			3
Average loans and leases — linked quarter annualized growth rate		3.1	%		6.3	%		(1.2	)%
Average earning assets	$	48,344,961		$	49,290,186		$	46,240,486			(2	)		5
Average total assets		53,368,554			54,146,249			51,702,032			(1	)		3
Average core deposits ⁽⁶⁾		39,274,265			38,949,046			37,271,725			1			5
Average core deposits — linked quarter annualized growth rate		3.3	%		9.9	%		5.4	%
Average shareholders’ equity	$	5,022,146		$	5,645,445		$	5,363,719			(11	)		(6	)

Total assets at end of period		52,948,509			53,819,642			51,866,798			(2	)		2
Total shareholders’ equity at end of period		5,038,599			4,980,542			5,369,686			1			(6	)

Net charge-offs (NCOs)		165,083			172,251			238,481			(4	)		(31	)
NCOs as a % of average loans and leases		1.73	%		1.82	%		2.58	%
Nonaccrual loans and leases (NALs)	$	636,257		$	777,948		$	1,766,108			(18	)		(64	)
NAL ratio		1.66	%		2.04	%		4.78	%
Nonperforming assets (NPAs)	$	690,886		$	844,752		$	1,918,368			(18	)		(64	)
NPA ratio		1.80	%		2.21	%		5.17	%
Allowance for loan and lease losses (ALLL) as a % of total loans and leases at the end of period		2.96			3.28			4.00
ALLL plus allowance for unfunded loan commitments and letters of credit (ACL) as a % of total loans and leases at the end of period		3.07			3.39			4.14
ACL as a % of NALs		185			166			87
ACL as a % of NPAs		170			153			80
Tier 1 leverage ratio ⁽⁷⁾		9.80			9.41			10.05
Tier 1 common risk-based capital ratio⁽⁷⁾		9.75			9.29			6.53
Tier 1 risk-based capital ratio ⁽⁷⁾		12.04			11.55			11.97
Total risk-based capital ratio ⁽⁷⁾		14.85			14.46			14.28
Tangible common equity / risk-weighted assets ratio		9.51			9.26			7.19
Tangible equity / tangible assets ratio⁽⁸⁾		8.51			8.24			9.26
Tangible common equity / tangible assets ratio⁽⁹⁾		7.81			7.56			5.96

N.R. — Not relevant, as denominator of calculation is a loss in prior period compared with income in current period.

See Notes to the Quarterly Key Statistics.


Notes to the Quarterly Key Statistics

⁽¹⁾		Comparisons for all presented periods are impacted by a number of factors. Refer to “Significant Items”.

⁽²⁾		For all periods presented, the impact of the convertible preferred stock issued in 2008 and the warrants issued to the U.S. Department of the Treasury in 2008 related to Huntington’s participation in the voluntary Capital Purchase Program was excluded from the diluted share calculation because the result was more than basic earnings per common share (anti-dilutive) for the periods.

⁽³⁾		Net income excluding expense for amortization of intangibles for the period divided by average tangible shareholders’ equity. Average tangible shareholders’ equity equals average total shareholders’ equity less average intangible assets and goodwill. Expense for amortization of intangibles and average intangible assets are net of deferred tax liability, and calculated assuming a 35% tax rate.

⁽⁴⁾		On a fully-taxable equivalent (FTE) basis assuming a 35% tax rate.

⁽⁵⁾		Noninterest expense less amortization of intangibles and goodwill impairment divided by the sum of FTE net interest income and noninterest income excluding securities gains (losses).

⁽⁶⁾		Includes noninterest-bearing and interest-bearing demand deposits, money market deposits, savings and other domestic deposits, and core certificates of deposit.

⁽⁷⁾		March 31, 2011, figures are estimated. Based on an interim decision by the banking agencies on December 14, 2006, Huntington has excluded the impact of adopting ASC Topic 715, “Compensation — Retirement Benefits”, from the regulatory capital calculations.

⁽⁸⁾		Tangible equity (total equity less goodwill and other intangible assets) divided by tangible assets (total assets less goodwill and other intangible assets). Other intangible assets are net of deferred tax liability, and calculated assuming a 35% tax rate.

⁽⁹⁾		Tangible common equity (total common equity less goodwill and other intangible assets) divided by tangible assets (total assets less goodwill and other intangible assets). Other intangible assets are net of deferred tax liability, and calculated assuming a 35% tax rate.

Huntington Bancshares Incorporated
Consolidated Balance Sheets


										Change
	2011			2010						March ’11 vs ’10
(dollar amounts in thousands, except number of shares)	March 31,			December 31,			March 31,			Amount			Percent
	(Unaudited)						(Unaudited)

Assets
Cash and due from banks	$	1,208,820		$	847,888		$	1,310,640		$	(101,820	)		(8	)%
Interest-bearing deposits in banks		129,999			135,038			364,082			(234,083	)		(64	)
Trading account securities		164,489			185,404			150,463			14,026			9
Loans held for sale		164,282			793,285			327,408			(163,126	)		(50	)
Available-for-sale and other securities		9,322,434			9,895,244			8,946,364			376,070			4
Loans and leases⁽¹⁾		38,245,836			38,106,507			36,931,681			1,314,155			4
Allowance for loan and lease losses		(1,133,226	)		(1,249,008	)		(1,477,969	)		344,743			(23	)

Net loans and leases		37,112,610			36,857,499			35,453,712			1,658,898			5

Bank owned life insurance		1,471,099			1,458,224			1,422,874			48,225			3
Premises and equipment		500,736			491,602			491,573			9,163			2
Goodwill		444,268			444,268			444,268			—			—
Other intangible assets		215,251			228,620			273,952			(58,701	)		(21	)
Accrued income and other assets		2,214,521			2,482,570			2,681,462			(466,941	)		(17	)

Total Assets	$	52,948,509		$	53,819,642		$	51,866,798		$	1,081,711			2	%


Liabilities and Shareholders’ Equity
Liabilities
Deposits⁽²⁾	$	41,366,487		$	41,853,898		$	40,303,467		$	1,063,020			3	%
Short-term borrowings		2,051,258			2,040,732			980,839			1,070,419			109
Federal Home Loan Bank advances		21,379			172,519			157,895			(136,516	)		(86	)
Other long-term debt		1,900,555			2,144,092			2,727,745			(827,190	)		(30	)
Subordinated notes		1,487,566			1,497,216			1,266,907			220,659			17
Accrued expenses and other liabilities		1,082,665			1,130,643			1,060,259			22,406			2

Total Liabilities		47,909,910			48,839,100			46,497,112			1,412,798			3


Shareholder’s Equity

Preferred stock — authorized 6,617,808 shares-

5.00% Series B Non-voting, Cumulative Preferred Stock, par value of $0.01 and liquidation value per share of $1,000		—			—			1,329,186			(1,329,186	)		(100	)

8.50% Series A Non-cumulative Perpetual Convertible Preferred Stock, par value and liquidation value per share of $1,000		362,507			362,507			362,507			—			—

Common stock -

Par value of $0.01		8,643			8,642			7,174			1,469			20
Capital surplus		7,584,367			7,630,093			6,735,472			848,895			13
Less treasury shares, at cost		(8,647	)		(8,771	)		(9,019	)		372			(4	)
Accumulated other comprehensive income (loss):
Unrealized losses on investment securities		(96,320	)		(101,717	)		(84,334	)		(11,986	)		14
Unrealized gains (losses) on cash flow hedging derivatives		21,288			35,710			62,163			(40,875	)		(66	)
Pension and other postretirement benefit adjustments		(128,889	)		(131,489	)		(111,302	)		(17,587	)		16
Retained earnings		(2,704,350	)		(2,814,433	)		(2,922,161	)		217,811			(7	)

Total Shareholders’ Equity		5,038,599			4,980,542			5,369,686			(331,087	)		(6	)

Total Liabilities and Shareholders’ Equity	$	52,948,509		$	53,819,642		$	51,866,798		$	1,081,711			2	%


Common shares authorized (par value of $0.01)		1,500,000,000			1,500,000,000			1,000,000,000
Common shares issued		864,279,984			864,195,369			717,382,476
Common shares outstanding		863,398,578			863,319,435			716,556,641
Treasury shares outstanding		881,406			875,934			825,835
Preferred shares issued		1,967,071			1,967,071			1,967,071
Preferred shares outstanding		362,507			362,507			1,760,578


⁽¹⁾		See page 2 for detail of loans and leases.

⁽²⁾		See page 3 for detail of deposits.

Huntington Bancshares Incorporated
Loans and Leases Composition


	2011				2010
(dollar amounts in millions)	March 31,				December 31,				September 30,				June 30,				March 31,
	(Unaudited)								(Unaudited)				(Unaudited)				(Unaudited)
Ending Balances by Type:
Commercial:⁽¹⁾
Commercial and industrial	$	13,299	35	%	$	13,063	34	%	$	12,425	33	%	$	12,392	34	%	$	12,245	33	%
Commercial real estate:
Construction		587	2			650	2			738	2			1,106	3			1,443	4
Commercial		5,711	15			6,001	16			6,174	16			6,078	16			6,013	16

Commercial real estate		6,298	17			6,651	18			6,912	18			7,184	19			7,456	20

Total commercial		19,597	52			19,714	52			19,337	51			19,576	53			19,701	53

Consumer:
Automobile		5,802	15			5,614	15			5,385	14			4,847	13			4,403	12
Home equity		7,784	20			7,713	20			7,690	21			7,510	20			7,514	20
Residential mortgage		4,517	12			4,500	12			4,511	12			4,354	12			4,614	12
Other consumer		546	1			566	1			578	2			683	2			700	3

Total consumer		18,649	48			18,393	48			18,164	49			17,394	47			17,231	47

Total loans and leases	$	38,246	100	%	$	38,107	100	%	$	37,501	100	%	$	36,970	100	%	$	36,932	100	%


Ending Balances by Business Segment:
Retail and Business Banking	$	11,786	31	%	$	11,717	31	%	$	11,804	31	%	$	11,772	32	%	$	11,751	32	%
Regional and Commercial Banking		7,917	21			7,792	20			7,373	20			7,317	20			7,227	20
AFCRE		13,154	34			13,283	35			13,167	35			12,931	35			12,739	34
WGH		5,255	14			5,176	14			5,066	14			4,864	13			4,722	13
Treasury / Other⁽²⁾		134	—			139	—			91	—			86	—			493	1

Total loans and leases	$	38,246	100	%	$	38,107	100	%	$	37,501	100	%	$	36,970	100	%	$	36,932	100	%


	2011				2010
	First				Fourth				Third				Second				First
Average Balances by Business Segment:
Retail and Business Banking	$	11,780	31	%	$	11,274	30	%	$	11,817	32	%	$	11,809	32	%	$	11,779	32	%
Regional and Commercial Banking		7,824	21			7,657	20			7,419	20			7,257	20			7,322	20
AFCRE		13,208	35			13,299	35			13,085	35			12,890	35			12,817	35
WGH		5,192	13			5,050	14			4,894	13			4,729	12			4,631	12
Treasury / Other⁽²⁾		94	—			520	1			—	—			404	1			431	1

Total loans and leases	$	38,098	100	%	$	37,800	100	%	$	37,215	100	%	$	37,089	100	%	$	36,980	100	%


⁽¹⁾		There were no commercial loans outstanding that would be considered a concentration of lending to a particular industry.

⁽²⁾		Comprised primarily of Franklin loans through the 2010 second quarter.

Huntington Bancshares Incorporated
Deposits Composition


	2011				2010
(dollar amounts in millions)	March 31,				December 31,				September 30,				June 30,				March 31,
	(Unaudited)								(Unaudited)				(Unaudited)				(Unaudited)
Ending Balances by Type:
Demand deposits — noninterest-bearing	$	7,597	18	%	$	7,217	17	%	$	6,926	17	%	$	6,463	16	%	$	6,938	17	%
Demand deposits — interest-bearing		5,532	13			5,469	13			5,347	13			5,850	15			5,948	15
Money market deposits		13,105	32			13,410	32			12,679	31			11,437	29			10,644	26
Savings and other domestic deposits		4,762	12			4,643	11			4,613	11			4,652	12			4,666	12
Core certificates of deposit		8,208	20			8,525	20			8,765	21			8,974	23			9,441	23

Total core deposits		39,204	95			39,264	93			38,330	93			37,376	95			37,637	93
Other domestic deposits of $250,000 or more		531	1			675	2			730	2			678	2			684	2
Brokered deposits and negotiable CDs		1,253	3			1,532	4			1,576	4			1,373	3			1,605	4
Deposits in foreign offices		378	1			383	1			436	1			422	—			377	1

Total deposits	$	41,366	100	%	$	41,854	100	%	$	41,072	100	%	$	39,849	100	%	$	40,303	100	%


Total core deposits:
Commercial	$	12,785	33	%	$	12,476	32	%	$	12,262	32	%	$	11,515	31	%	$	11,844	31	%
Personal		26,419	67			26,788	68			26,068	68			25,861	69			25,793	69

Total core deposits	$	39,204	100	%	$	39,264	100	%	$	38,330	100	%	$	37,376	100	%	$	37,637	100	%


Ending Balances by Business Segment:
Retail and Business Banking	$	28,984	70	%	$	29,298	70	%	$	28,808	70	%	$	28,542	72	%	$	28,335	70	%
Regional and Commercial Banking		3,589	9			3,538	8			3,245	8			2,861	7			3,003	7
AFCRE		804	2			753	2			739	2			725	2			653	2
WGH		7,363	17			7,449	18			7,184	17			6,734	17			7,134	18
Treasury / Other⁽¹⁾		626	2			816	2			1,096	3			987	2			1,178	3

Total deposits	$	41,366	100	%	$	41,854	100	%	$	41,072	100	%	$	39,849	100	%	$	40,303	100	%


	2011				2010
	First				Fourth				Third				Second				First
Average Balances by Business Segment:
Retail and Business Banking	$	29,139	70	%	$	29,241	70	%	$	28,874	71	%	$	28,592	71	%	$	28,371	71	%
Regional and Commercial Banking		3,666	9			3,471	8			3,090	8			3,001	7			3,130	8
AFCRE		763	2			752	2			714	1			672	2			636	1
WGH		7,394	17			7,333	18			6,867	17			6,994	17			6,759	17
Treasury / Other ⁽¹⁾		702	2			907	2			1,101	3			1,108	3			1,327	3

Total deposits	$	41,664	100	%	$	41,704	100	%	$	40,646	100	%	$	40,367	100	%	$	40,223	100	%


⁽¹⁾		Comprised primarily of national market deposits.

Huntington Bancshares Incorporated
Consolidated Quarterly Average Balance Sheets
(Unaudited)


																Change
	2011			2010												1Q11 vs 1Q10
(dollar amounts in millions)	First			Fourth			Third			Second			First			Amount			Percent
Assets
Interest-bearing deposits in banks	$	130		$	218		$	282		$	309		$	348		$	(218	)		(63	)%
Trading account securities		144			297			110			127			96			48			50
Loans held for sale		420			779			663			323			346			74			21
Available-for-sale and other securities:
Taxable		9,108			9,747			8,876			8,369			8,027			1,081			13
Tax-exempt		445			449			365			389			443			2			—

Total available-for-sale and other securities		9,553			10,196			9,241			8,758			8,470			1,083			13
Loans and leases:⁽¹⁾
Commercial:
Commercial and industrial		13,121			12,767			12,393			12,244			12,314			807			7
Commercial real estate:
Construction		611			716			989			1,279			1,409			(798	)		(57	)
Commercial		5,913			6,082			6,084			6,085			6,268			(355	)		(6	)

Commercial real estate		6,524			6,798			7,073			7,364			7,677			(1,153	)		(15	)

Total commercial		19,645			19,565			19,466			19,608			19,991			(346	)		(2	)

Consumer:
Automobile		5,701			5,520			5,140			4,634			4,250			1,451			34
Home equity		7,728			7,709			7,567			7,544			7,539			189			3
Residential mortgage		4,465			4,430			4,389			4,608			4,477			(12	)		—
Other consumer		559			576			653			695			723			(164	)		(23	)

Total consumer		18,453			18,235			17,749			17,481			16,989			1,464			9

Total loans and leases		38,098			37,800			37,215			37,089			36,980			1,118			3
Allowance for loan and lease losses		(1,231	)		(1,323	)		(1,384	)		(1,506	)		(1,510	)		279			(18	)

Net loans and leases		36,867			36,477			35,831			35,583			35,470			1,397			4

Total earning assets		48,345			49,290			47,511			46,606			46,240			2,105			5

Cash and due from banks		1,299			1,187			1,618			1,509			1,761			(462	)		(26	)
Intangible assets		665			679			695			710			725			(60	)		(8	)
All other assets		4,291			4,313			4,277			4,384			4,486			(195	)		(4	)

Total Assets	$	53,369		$	54,146		$	52,717		$	51,703		$	51,702		$	1,667			3	%


Liabilities and Shareholders’ Equity
Deposits:
Demand deposits — noninterest-bearing	$	7,333		$	7,188		$	6,768		$	6,849		$	6,627		$	706			11	%
Demand deposits — interest-bearing		5,357			5,317			5,319			5,971			5,716			(359	)		(6	)
Money market deposits		13,492			13,158			12,336			11,103			10,340			3,152			30
Savings and other domestic deposits		4,701			4,640			4,639			4,677			4,613			88			2
Core certificates of deposit		8,391			8,646			8,948			9,199			9,976			(1,585	)		(16	)

Total core deposits		39,274			38,949			38,010			37,799			37,272			2,002			5
Other domestic deposits of $250,000 or more		606			737			690			661			698			(92	)		(13	)
Brokered deposits and negotiable CDs		1,410			1,575			1,495			1,505			1,843			(433	)		(23	)
Deposits in foreign offices		374			443			451			402			410			(36	)		(9	)

Total deposits		41,664			41,704			40,646			40,367			40,223			1,441			4
Short-term borrowings		2,134			2,134			1,739			966			927			1,207			130
Federal Home Loan Bank advances		30			112			188			212			179			(149	)		(83	)
Subordinated notes and other long-term debt		3,525			3,558			3,672			3,836			4,062			(537	)		(13	)

Total interest bearing liabilities		40,020			40,320			39,477			38,532			38,764			1,256			3

All other liabilities		994			993			952			924			947			47			5
Shareholders’ equity		5,022			5,645			5,520			5,398			5,364			(342	)		(6	)

Total Liabilities and Shareholders’ Equity	$	53,369		$	54,146		$	52,717		$	51,703		$	51,702		$	1,667			3	%


⁽¹⁾		Includes nonaccrual loans.

Huntington Bancshares Incorporated
Consolidated Quarterly Net Interest Margin Analysis
(Unaudited)


	2011			2010
Fully-taxable equivalent basis⁽¹⁾	First			Fourth			Third			Second			First
Assets
Interest-bearing deposits in banks		0.11	%		0.63	%		0.21	%		0.20	%		0.18	%
Trading account securities		1.37			1.98			1.20			1.74			2.15
Loans held for sale		4.08			4.01			5.75			5.02			4.98
Available-for-sale and other securities:
Taxable		2.53			2.42			2.77			2.85			2.94
Tax-exempt		4.70			4.59			4.70			4.62			4.37

Total available-for-sale and other securities		2.63			2.52			2.84			2.93			3.01
Loans and leases:⁽²⁾⁽³⁾
Commercial:
Commercial and industrial		4.57			4.94			5.14			5.31			5.60
Commercial real estate:
Construction		3.36			3.07			2.83			2.61			2.66
Commercial		3.93			3.92			3.91			3.69			3.60

Commercial real estate		3.88			3.83			3.76			3.49			3.43

Total commercial		4.34			4.56			4.64			4.63			4.76

Consumer:
Automobile		5.22			5.46			5.79			6.46			6.63
Home equity		4.54			4.64			4.74			5.26			5.59
Residential mortgage		4.76			4.82			4.97			4.70			4.89
Other consumer		7.85			7.92			7.10			6.84			7.00

Total consumer		4.90			5.04			5.19			5.49			5.73

Total loans and leases		4.61			4.79			4.90			5.04			5.21

Total earning assets		4.24	%		4.29	%		4.49	%		4.63	%		4.82	%


Liabilities and Shareholders’ Equity
Deposits:
Demand deposits — noninterest-bearing		—	%		—	%		—	%		—	%		—	%
Demand deposits — interest-bearing		0.09			0.13			0.17			0.22			0.22
Money market deposits		0.50			0.77			0.86			0.93			1.00
Savings and other domestic deposits		0.81			0.90			0.99			1.07			1.19
Core certificates of deposit		2.07			2.11			2.31			2.68			2.93

Total core deposits		0.89			1.05			1.18			1.33			1.51
Other domestic deposits of $250,000 or more		1.08			1.21			1.28			1.37			1.44
Brokered deposits and negotiable CDs		1.11			1.53			2.21			2.56			2.49
Deposits in foreign offices		0.20			0.17			0.22			0.19			0.19

Total deposits		0.90			1.06			1.21			1.37			1.55
Short-term borrowings		0.18			0.20			0.22			0.21			0.21
Federal Home Loan Bank advances		2.98			0.95			1.25			1.93			2.71
Subordinated notes and other long-term debt		2.34			2.15			2.15			2.05			2.25

Total interest bearing liabilities		0.99			1.11			1.25			1.41			1.60

Net interest rate spread		3.21			3.16			3.24			3.22			3.22
Impact of noninterest-bearing funds on margin		0.21			0.21			0.21			0.24			0.25

Net interest margin		3.42	%		3.37	%		3.45	%		3.46	%		3.47	%


⁽¹⁾		Fully-taxable equivalent (FTE) yields are calculated assuming a 35% tax rate. See page 8 for the FTE adjustment.

⁽²⁾		Loan, lease, and deposit average rates include impact of applicable derivatives, non-deferrable fees, and amortized fees.

⁽³⁾		Includes the impact of nonaccrual loans.

Huntington Bancshares Incorporated
Selected Quarterly Income Statement Data⁽¹⁾
(Unaudited)


	2011			2010												1Q11 vs 1Q10
(dollar amounts in thousands, except per share amounts)	First			Fourth			Third			Second			First			Amount			Percent
Interest income	$	501,877		$	528,291		$	534,669		$	535,653		$	546,779		$	(44,902	)		(8	)%
Interest expense		97,547			112,997			124,707			135,997			152,886			(55,339	)		(36	)

Net interest income		404,330			415,294			409,962			399,656			393,893			10,437			3
Provision for credit losses		49,385			86,973			119,160			193,406			235,008			(185,623	)		(79	)

Net interest income after provision for credit losses		354,945			328,321			290,802			206,250			158,885			196,060			123

Service charges on deposit accounts		54,324			55,810			65,932			75,934			69,339			(15,015	)		(22	)
Mortgage banking income		22,684			53,169			52,045			45,530			25,038			(2,354	)		(9	)
Trust services		30,742			29,394			26,997			28,399			27,765			2,977			11
Electronic banking		28,786			28,900			28,090			28,107			25,137			3,649			15
Insurance income		17,945			19,678			19,801			18,074			18,860			(915	)		(5	)
Brokerage income		20,511			16,953			16,575			18,425			16,902			3,609			21
Bank owned life insurance income		14,819			16,113			14,091			14,392			16,470			(1,651	)		(10	)
Automobile operating lease income		8,847			10,463			11,356			11,842			12,303			(3,456	)		(28	)
Securities (losses) gains		40			(103	)		(296	)		156			(31	)		71			N.R.
Other income		38,247			33,843			32,552			28,784			29,069			9,178			32

Total noninterest income		236,945			264,220			267,143			269,643			240,852			(3,907	)		(2	)

Personnel costs		219,028			212,184			208,272			194,875			183,642			35,386			19
Outside data processing and other services		40,282			40,943			38,553			40,670			39,082			1,200			3
Net occupancy		28,436			26,670			26,718			25,388			29,086			(650	)		(2	)
Deposit and other insurance expense		17,896			23,320			23,406			26,067			24,755			(6,859	)		(28	)
Professional services		13,465			21,021			20,672			24,388			22,697			(9,232	)		(41	)
Equipment		22,477			22,060			21,651			21,585			20,624			1,853			9
Marketing		16,895			16,168			20,921			17,682			11,153			5,742			51
Amortization of intangibles		13,370			15,046			15,145			15,141			15,146			(1,776	)		(12	)
OREO and foreclosure expense		3,931			10,502			12,047			4,970			11,530			(7,599	)		(66	)
Automobile operating lease expense		6,836			8,142			9,159			9,667			10,066			(3,230	)		(32	)
Other expense		48,083			38,537			30,765			33,377			30,312			17,771			59

Total noninterest expense		430,699			434,593			427,309			413,810			398,093			32,606			8

Income before income taxes		161,191			157,948			130,636			62,083			1,644			159,547			9,705
Provision (benefit) for income taxes		34,745			35,048			29,690			13,319			(38,093	)		72,838			N.R

Net income	$	126,446		$	122,900		$	100,946		$	48,764		$	39,737		$	86,709			218

Dividends on preferred shares		7,703			83,754			29,495			29,426			29,357			(21,654	)		(74	)

Net income applicable to common shares	$	118,743		$	39,146		$	71,451		$	19,338		$	10,380		$	108,363			1,044	%


Average common shares — basic		863,359			757,924			716,911			716,580			716,320			147,039			21	%
Average common shares — diluted⁽²⁾		867,237			760,582			719,567			719,387			718,593			148,644			21

Per common share
Net income — basic	$	0.14		$	0.05		$	0.10		$	0.03		$	0.01		$	0.13			1,300	%
Net income — diluted		0.14			0.05			0.10			0.03			0.01			0.13			1,300
Cash dividends declared		0.01			0.01			0.01			0.01			0.01			—			—

Return on average total assets		0.96	%		0.90	%		0.76	%		0.38	%		0.31	%		0.65	%		210
Return on average common shareholders’ equity		10.3			3.8			7.4			2.1			1.1			9.2			836
Return on average common tangible shareholders’ equity⁽³⁾		12.7			5.6			10.0			3.8			2.7			10.0			370
Net interest margin⁽⁴⁾		3.42			3.37			3.45			3.46			3.47			(0.05	)		(1	)
Efficiency ratio⁽⁵⁾		64.7			61.4			60.6			59.4			60.1			4.6			8
Effective tax rate		21.6			22.2			22.7			21.5			(2,317.1	)		2,338.7			N.R

Revenue — fully-taxable equivalent (FTE)
Net interest income	$	404,330		$	415,294		$	409,962		$	399,656		$	393,893		$	10,437			3
FTE adjustment		3,945			3,708			2,631			2,490			2,248			1,697			75

Net interest income⁽⁴⁾		408,275			419,002			412,593			402,146			396,141			12,134			3
Noninterest income		236,945			264,220			267,143			269,643			240,852			(3,907	)		(2	)

Total revenue⁽⁴⁾	$	645,220		$	683,222		$	679,736		$	671,789		$	636,993		$	8,227			1	%


N.R. — Not relevant, as denominator of calculation is a loss in prior period compared with income in current period.


⁽¹⁾		Comparisons for presented periods are impacted by a number of factors. Refer to “Significant Items” for additional discussion regarding these key factors.

⁽²⁾		For all periods presented, the impact of the convertible preferred stock issued in 2008 and the warrants issued to the U.S. Department of the Treasury in 2008 related to Huntington’s participation in the voluntary Capital Purchase Program was excluded from the diluted share calculation because the result was more than basic earnings per common share (anti-dilutive) for the periods. The convertible preferred stock and warrants were repurchased in December 2010, and January 2011, respectively.

⁽³⁾		Net income excluding expense for amortization of intangibles for the period divided by average tangible shareholders’ equity. Average tangible shareholders’ equity equals average total shareholders’ equity less average intangible assets and goodwill. Expense for amortization of intangibles and average intangible assets are net of deferred tax liability, and calculated assuming a 35% tax rate.

⁽⁴⁾		On a fully-taxable equivalent (FTE) basis assuming a 35% tax rate.

⁽⁵⁾		Noninterest expense less amortization of intangibles and goodwill impairment divided by the sum of FTE net interest income and noninterest income excluding securities gains (losses).

Huntington Bancshares Incorporated
Quarterly Mortgage Banking Income
(Unaudited)


	2011			2010												1Q11 vs 1Q10
(dollar amounts in thousands, except as noted)	First			Fourth			Third			Second			First			Amount			Percent
Mortgage Banking Income
Origination and secondary marketing	$	19,799		$	48,236		$	35,840		$	19,778		$	13,586		$	6,213			46	%
Servicing fees		12,546			11,474			12,053			12,178			12,418			128			1
Amortization of capitalized servicing		(9,863	)		(13,960	)		(13,003	)		(10,137	)		(10,065	)		202			(2	)
Other mortgage banking income		3,769			4,789			4,966			3,664			3,210			559			17

Subtotal		26,251			50,539			39,856			25,483			19,149			7,102			37

MSR valuation adjustment⁽¹⁾		774			31,319			(12,047	)		(26,221	)		(5,772	)		6,546			N.R.
Net trading (losses) gains related to MSR hedging		(4,341	)		(28,689	)		24,236			46,268			11,661			(16,002	)		N.R.

Total mortgage banking income	$	22,684		$	53,169		$	52,045		$	45,530		$	25,038		$	(2,354	)		(9)	%


Mortgage originations (in millions)	$	929		$	1,827		$	1,619		$	1,161		$	869		$	60			7	%
Average trading account securities used to hedge MSRs (in millions)		46			184			23			28			18			28			156
Capitalized mortgage servicing rights⁽²⁾		202,559			196,194			161,594			179,138			207,552			(4,993	)		(2	)
Total mortgages serviced for others (in millions)⁽²⁾		16,456			15,933			15,713			15,954			15,968			488			3
MSR % of investor servicing portfolio⁽²⁾		1.23	%		1.23	%		1.03	%		1.12	%		1.30	%		(0.07	)%		(5	)


Net impact of MSR hedging
MSR valuation adjustment⁽¹⁾	$	774		$	31,319		$	(12,047	)	$	(26,221	)	$	(5,772	)	$	6,546			N.R.	%
Net trading (losses) gains related to MSR hedging		(4,341	)		(28,689	)		24,236			46,268			11,661			(16,002	)		N.R.
Net interest income related to MSR hedging		99			713			32			58			169			(70	)		(41	)

Net (loss) gain of MSR hedging	$	(3,468	)	$	3,343		$	12,221		$	20,105		$	6,058		$	(9,526	)		(157	)%


N.R. — Not relevant, as denominator of calculation is a loss in prior period compared with income in current period.

⁽¹⁾		The change in fair value for the period represents the MSR valuation adjustment, net of amortization of capitalized servicing.

⁽²⁾		At period end.

Huntington Bancshares Incorporated
Quarterly Credit Reserves Analysis
(Unaudited)


	2011			2010
(dollar amounts in thousands)	First			Fourth			Third			Second			First

Allowance for loan and lease losses, beginning of period	$	1,249,008		$	1,336,352		$	1,402,160		$	1,477,969		$	1,482,479
Loan and lease losses		(199,007	)		(205,587	)		(221,144	)		(312,954	)		(264,222	)
Recoveries of loans previously charged off		33,924			33,336			36,630			33,726			25,741

Net loan and lease losses		(165,083	)		(172,251	)		(184,514	)		(279,228	)		(238,481	)

Provision for loan and lease losses		49,301			84,907			118,788			203,633			233,971
Allowance of assets sold		—			—			(82	)		(214	)		—

Allowance for loan and lease losses, end of period	$	1,133,226		$	1,249,008		$	1,336,352		$	1,402,160		$	1,477,969

Allowance for unfunded loan commitments and letters of credit, beginning of period	$	42,127		$	40,061		$	39,689		$	49,916		$	48,879

Provision for (reduction in) unfunded loan commitments and letters of credit losses		84			2,066			372			(10,227	)		1,037

Allowance for unfunded loan commitments and letters of credit, end of period	$	42,211		$	42,127		$	40,061		$	39,689		$	49,916

Total allowance for credit losses, end of period	$	1,175,437		$	1,291,135		$	1,376,413		$	1,441,849		$	1,527,885


Allowance for loan and lease losses (ALLL) as % of:
Total loans and leases		2.96	%		3.28	%		3.56	%		3.79	%		4.00	%
Nonaccrual loans and leases (NALs)		178			161			136			117			84
Nonperforming assets (NPAs)		164			148			121			89			77

Total allowance for credit losses (ACL) as % of:
Total loans and leases		3.07	%		3.39	%		3.67	%		3.90	%		4.14	%
Nonaccrual loans and leases		185			166			140			120			87
Nonperforming assets		170			153			125			91			80

Huntington Bancshares Incorporated
Quarterly Net Charge-Off Analysis
(Unaudited)


	2011			2010
(dollar amounts in thousands)	First			Fourth			Third			Second			First

Net charge-offs by loan and lease type:
Commercial:
Commercial and industrial	$	42,191		$	59,124		$	62,241		$	58,128		$	75,439
Commercial real estate:
Construction		28,400			11,084			17,936			45,562			34,426
Commercial		39,283			33,787			45,725			36,169			50,873

Commercial real estate		67,683			44,871			63,661			81,731			85,299

Total commercial		109,874			103,995			125,902			139,859			160,738

Consumer:
Automobile		4,712			7,035			5,570			5,436			8,531
Home equity⁽¹⁾		26,715			29,175			27,827			44,470			37,901
Residential mortgage⁽²⁾⁽³⁾		18,932			26,775			18,961			82,848			24,311
Other consumer		4,850			5,271			6,254			6,615			7,000

Total consumer		55,209			68,256			58,612			139,369			77,743

Total net charge-offs	$	165,083		$	172,251		$	184,514		$	279,228		$	238,481


Net charge-offs — annualized percentages:
Commercial:
Commercial and industrial		1.29	%		1.85	%		2.01	%		1.90	%		2.45	%
Commercial real estate:
Construction		18.59			6.19			7.25			14.25			9.77
Commercial		2.66			2.22			3.01			2.38			3.25

Commercial real estate		4.15			2.64			3.60			4.44			4.44

Total commercial		2.24			2.13			2.59			2.85			3.22

Consumer:
Automobile		0.33			0.51			0.43			0.47			0.80
Home equity⁽¹⁾		1.38			1.51			1.47			2.36			2.01
Residential mortgage⁽²⁾⁽³⁾		1.70			2.42			1.73			7.19			2.17
Other consumer		3.47			3.66			3.83			3.81			3.87

Total consumer		1.20			1.50			1.32			3.19			1.83

Net charge-offs as a % of average loans		1.73	%		1.82	%		1.98	%		3.01	%		2.58	%


⁽¹⁾		The 2010 second quarter included net charge-offs of $14,678 thousand associated with the transfer of Franklin-related loans to loans held for sale and $1,262 thousand of other Franklin-related net charge-offs.

⁽²⁾		The 2010 second quarter included net charge-offs of $60,822 thousand associated with the transfer of Franklin-related loans to loans held for sale and $3,403 thousand of other Franklin-related net charge-offs.

⁽³⁾		The 2010 fourth quarter included net charge-offs of $16,389 thousand related to the sale of certain underperforming residential mortgage loans.

Huntington Bancshares Incorporated
Quarterly Nonaccrual Loans and Leases (NALs) and Nonperforming Assets (NPAs)
(Unaudited)


	2011			2010
(dollar amounts in thousands)	March 31,			December 31,			September 30,			June 30,			March 31,

Nonaccrual loans and leases (NALs):
Commercial and industrial	$	260,397		$	346,720		$	398,353		$	429,561		$	511,588
Commercial real estate		305,793			363,692			478,754			663,103			826,781
Residential mortgage		44,812			45,010			82,984			86,486			372,950
Home equity		25,255			22,526			21,689			22,199			54,789

Total nonaccrual loans and leases		636,257			777,948			981,780			1,201,349			1,766,108

Other real estate, net:
Residential		28,668			31,649			65,775			71,937			68,289
Commercial		25,961			35,155			57,309			67,189			83,971

Total other real estate, net		54,629			66,804			123,084			139,126			152,260
Impaired loans held for sale⁽¹⁾		—			—			—			242,227			—

Total nonperforming assets	$	690,886		$	844,752		$	1,104,864		$	1,582,702		$	1,918,368


Nonperforming Franklin assets:
Residential mortgage	$	—		$	—		$	—		$	—			297,967
Home Equity		—			—			—			—			31,067
OREO		5,971			9,477			15,330			24,515			24,423
Impaired loans held for sale		—			—			—			242,227			—

Total nonperforming Franklin assets	$	5,971		$	9,477		$	15,330		$	266,742		$	353,457


Nonaccrual loans and leases as a % of total loans and leases		1.66	%		2.04	%		2.62	%		3.25	%		4.78	%

NPA ratio⁽²⁾		1.80			2.21			2.94			4.24			5.17


	2011			2010
	First			Fourth			Third			Second			First

Nonperforming assets, beginning of period	$	844,752		$	1,104,864		$	1,582,702		$	1,918,368		$	2,058,091
New nonperforming assets		192,044			237,802			278,388			171,595			237,914
Franklin impact, net		(3,506	)		(5,853	)		(251,412	)		(86,715	)		14,957
Returns to accruing status		(70,886	)		(100,051	)		(111,168	)		(78,739	)		(80,840	)
Loan and lease losses		(128,730	)		(126,047	)		(151,013	)		(173,159	)		(185,387	)
OREO losses		1,492			(5,117	)		(5,302	)		2,483			(4,160	)
Payments		(87,041	)		(191,296	)		(210,612	)		(140,881	)		(107,640	)
Sales		(57,239	)		(69,550	)		(26,719	)		(30,250	)		(14,567	)

Nonperforming assets, end of period	$	690,886		$	844,752		$	1,104,864		$	1,582,702		$	1,918,368


⁽¹⁾		The June 30, 2010, figure represented NALs associated with the transfer of Franklin-related residential mortgage and home equity loans to loans held for sale.

⁽²⁾		Nonperforming assets divided by the sum of loans and leases, impaired loans held for sale, and net other real estate owned.

Huntington Bancshares Incorporated
Quarterly Accruing Past Due Loans and Leases and Accruing Troubled Debt Restructured Loans
(Unaudited)


	2011			2010
(dollar amounts in thousands)	March 31,			December 31,			September 30,			June 30,			March 31,

Accruing loans and leases past due 90 days or more:
Commercial and industrial	$	—		$	—		$	—		$	—		$	475
Residential mortgage (excluding loans guaranteed by the U.S. Government)		41,858			53,983			56,803			47,036			72,702
Home equity		24,130			23,497			27,160			26,797			29,438
Other consumer		7,578			10,177			11,423			9,533			10,598

Total, excl. loans guaranteed by the U.S. Government		73,566			87,657			95,386			83,366			113,213
Add: loans guaranteed by U.S. Government		94,440			98,288			94,249			95,421			96,814

Total accruing loans and leases past due 90 days or more, including loans guaranteed by the U.S. Government	$	168,006		$	185,945		$	189,635		$	178,787		$	210,027


Ratios:

Excluding loans guaranteed by the U.S. Government, as a percent of total loans and leases		0.19	%		0.23	%		0.25	%		0.23	%		0.31	%

Guaranteed by U.S. Government, as a percent of total loans and leases		0.25			0.26			0.26			0.26			0.26

Including loans guaranteed by the U.S. Government, as a percent of total loans and leases		0.44			0.49			0.51			0.49			0.57

Accruing troubled debt restructured loans
Commercial	$	206,462		$	222,632		$	157,971		$	141,353		$	117,667
Residential mortgage		333,492			328,411			287,481			269,570			242,870
Other consumer		78,488			76,586			73,210			65,061			62,148

Total accruing troubled debt restructured loans	$	618,442		$	627,629		$	518,662		$	475,984		$	422,685

Huntington Bancshares Incorporated
Quarterly Common Stock Summary, Capital, and Other Data
(Unaudited)

Quarterly common stock summary


	2011		2010
(dollar amounts in thousands, except per share amounts)	First		Fourth		Third		Second		First

Common stock price, per share
High⁽¹⁾	$	7.700	$	7.000	$	6.450	$	7.400	$	5.810
Low⁽¹⁾		6.380		5.430		5.040		5.260		3.650
Close		6.640		6.870		5.690		5.540		5.390
Average closing price		6.981		6.050		5.787		6.130		4.840

Dividends, per share
Cash dividends declared per common share	$	0.01	$	0.01	$	0.01	$	0.01	$	0.01

Common shares outstanding
Average — basic		863,359		757,924		716,911		716,580		716,320
Average — diluted⁽²⁾		867,237		760,582		719,567		719,387		718,593
Ending		863,399		863,319		717,132		716,623		716,557

Book value per common share	$	5.42	$	5.35	$	5.39	$	5.22	$	5.13
Tangible book value per common share⁽³⁾		4.74		4.66		4.55		4.37		4.26


	2011			2010
(dollar amounts in millions)	March 31,			December 31,			September 30,			June 30,			March 31,

Calculation of tangible equity / asset ratio:
Total shareholders’ equity	$	5,039		$	4,981		$	5,567		$	5,438		$	5,370
Less: goodwill		(444	)		(444	)		(444	)		(444	)		(444	)
Less: other intangible assets		(215	)		(229	)		(244	)		(259	)		(274	)
Add: related deferred tax liability⁽³⁾		75			80			85			91			95

Total tangible equity		4,455			4,388			4,964			4,826			4,747
Less: preferred equity		(363	)		(363	)		(1,700	)		(1,696	)		(1,692	)

Total tangible common equity	$	4,092		$	4,025		$	3,264		$	3,130		$	3,055


Total assets	$	52,949		$	53,820		$	53,247		$	51,771		$	51,867
Less: goodwill		(444	)		(444	)		(444	)		(444	)		(444	)
Less: other intangible assets		(215	)		(229	)		(244	)		(259	)		(274	)
Add: related deferred tax liability⁽³⁾		75			80			85			91			95

Total tangible assets	$	52,365		$	53,227		$	52,644		$	51,159		$	51,244


Tangible equity / tangible asset ratio		8.51	%		8.24	%		9.43	%		9.43	%		9.26	%
Tangible common equity / tangible asset ratio		7.81			7.56			6.20			6.12			5.96

Other capital data:
Total risk-weighted assets	$	43,025		$	43,471		$	42,759		$	42,486		$	42,522

Tier 1 leverage ratio		9.80	%		9.41	%		10.54	%		10.45	%		10.05	%
Tier 1 common risk-based capital ratio		9.75			9.29			7.39			7.06			6.53
Tier 1 risk-based capital ratio		12.04			11.55			12.82			12.51			11.97
Total risk-based capital ratio		14.85			14.46			15.08			14.79			14.28
Tangible common equity / risk-weighted assets ratio		9.51			9.26			7.63			7.37			7.19

Other data:
Number of employees (full-time equivalent)		11,319			11,341			11,279			11,117			10,678
Number of domestic full-service branches⁽⁴⁾		622			620			617			617			617


⁽¹⁾		High and low stock prices are intra-day quotes obtained from NASDAQ.

⁽²⁾		For all periods presented, the impact of the convertible preferred stock issued in 2008 and the warrants issued to the U.S. Department of the Treasury in 2008 related to Huntington’s participation in the voluntary Capital Purchase Program was excluded from the diluted share calculation because the result was more than basic earnings per common share (anti-dilutive) for the periods.

⁽³⁾		Other intangible assets are net of deferred tax liability, and calculated assuming a 35% tax rate.

⁽⁴⁾		Includes 9 WGH offices.

HUNTINGTON BANCSHARES INC /MD/ - FORM 8-K - EX-99.3 - EXHIBIT 99.3 - April 20, 2011

Attached files

HUNTINGTON BANCSHARES INC /MD/ Reports