Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - HUNTINGTON BANCSHARES INC /MD/ | hban20170331_8kex991.htm |
| 8-K - 8-K - HUNTINGTON BANCSHARES INC /MD/ | hban20170331_8k.htm |
Exhibit 99.2
HUNTINGTON BANCSHARES INCORPORATED
Quarterly Financial Supplement
March 31, 2017
Table of Contents
Notes:
The preparation of financial statement data in conformity with accounting principles generally accepted in the United States (GAAP) 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.
Fully-Taxable Equivalent Basis
Interest income, yields, and ratios on a FTE basis are considered non-GAAP financial measures. Management believes net interest income on a FTE basis provides a more accurate picture of the interest margin for comparison purposes. The FTE basis also allows management to assess the comparability of revenue arising from both taxable and tax-exempt sources. The FTE basis assumes a federal statutory tax rate of 35 percent.
Non-Regulatory Capital Ratios
In addition to capital ratios defined by banking regulators, the Company considers various other measures when evaluating capital utilization and adequacy, including:
• | Tangible common equity to tangible assets, and |
• | Tangible common equity to risk-weighted assets using Basel III definition. |
These non-regulatory capital ratios are viewed by management as useful additional methods of reflecting the level of capital available to withstand unexpected market conditions. Additionally, presentation of these ratios allows readers to compare the Company’s capitalization to other financial services companies. These ratios differ from capital ratios defined by banking regulators principally in that the numerator excludes preferred securities, the nature and extent of which varies among different financial services companies. These ratios are not defined in GAAP or federal banking regulations. As a result, these non-regulatory capital ratios disclosed by the Company may be considered non-GAAP financial measures.
Because there are no standardized definitions for these non-regulatory capital ratios, the Company’s calculation methods may differ from those used by other financial services companies. Also, there may be limits in the usefulness of these measures to investors. As a result, the Company encourages readers to consider the consolidated financial statements and other financial information contained in the related press release in their entirety, and not to rely on any single financial measure.
Huntington Bancshares Incorporated
Quarterly Key Statistics(1)
(Unaudited)
Three months ended | ||||||||||||||||||
March 31, | December 31, | March 31, | Percent Changes vs. | |||||||||||||||
(amounts in thousands, except per share amounts and as noted) | 2017 | 2016 | 2016 | 4Q16 | 1Q16 | |||||||||||||
Net interest income (3) | $ | 742,033 | $ | 747,541 | $ | 512,225 | (1 | )% | 45 | % | ||||||||
FTE adjustment | (12,058 | ) | (12,560 | ) | (9,159 | ) | (4 | ) | 32 | |||||||||
Net interest income | 729,975 | 734,981 | 503,066 | (1 | ) | 45 | ||||||||||||
Provision for credit losses | 67,638 | 74,906 | 27,582 | (10 | ) | 145 | ||||||||||||
Noninterest income | 312,463 | 334,337 | 241,867 | (7 | ) | 29 | ||||||||||||
Noninterest expense | 707,422 | 681,497 | 491,080 | 4 | 44 | |||||||||||||
Income before income taxes | 267,378 | 312,915 | 226,271 | (15 | ) | 18 | ||||||||||||
Provision for income taxes | 59,284 | 73,952 | 54,957 | (20 | ) | 8 | ||||||||||||
Net income | 208,094 | 238,963 | 171,314 | (13 | ) | 21 | ||||||||||||
Dividends on preferred shares | 18,878 | 18,865 | 7,998 | — | — | |||||||||||||
Net income applicable to common shares | $ | 189,216 | $ | 220,098 | $ | 163,316 | (14 | )% | 16 | % | ||||||||
Net income per common share - diluted | $ | 0.17 | $ | 0.20 | $ | 0.20 | (15 | )% | (15 | )% | ||||||||
Cash dividends declared per common share | 0.08 | 0.08 | 0.07 | — | 14 | |||||||||||||
Tangible book value per common share at end of period | 6.55 | 6.43 | 7.12 | 2 | (8 | ) | ||||||||||||
Average common shares - basic | 1,086,374 | 1,085,253 | 795,755 | — | 37 | |||||||||||||
Average common shares - diluted | 1,108,617 | 1,104,358 | 808,349 | — | 37 | |||||||||||||
Ending common shares outstanding | 1,087,120 | 1,085,689 | 796,689 | — | 36 | |||||||||||||
Return on average assets | 0.84 | % | 0.95 | % | 0.96 | % | ||||||||||||
Return on average common shareholders’ equity | 8.2 | 9.4 | 10.4 | |||||||||||||||
Return on average tangible common shareholders’ equity(2) | 11.3 | 12.9 | 11.9 | |||||||||||||||
Net interest margin(3) | 3.30 | 3.25 | 3.11 | |||||||||||||||
Efficiency ratio(4) | 65.7 | 61.6 | 64.6 | |||||||||||||||
Effective tax rate | 22.2 | 23.6 | 24.3 | |||||||||||||||
Average total assets (millions) | $ | 100,343 | $ | 100,367 | $ | 71,596 | — | 40 | ||||||||||
Average earning assets (millions) | 91,139 | 91,463 | 66,234 | — | 38 | |||||||||||||
Average loans and leases (millions) | 66,981 | 66,405 | 50,618 | 1 | 32 | |||||||||||||
Average loans and leases - linked quarter annualized growth rate | 3.5 | % | 37.4 | % | 6.4 | % | ||||||||||||
Average total deposits (millions) | $ | 75,939 | $ | 76,886 | $ | 54,979 | (1 | ) | 38 | |||||||||
Average core deposits(5) (millions) | 71,500 | 72,070 | 51,363 | (1 | ) | 39 | ||||||||||||
Average core deposits - linked quarter annualized growth rate | (3.2 | )% | 64.8 | % | (1.7 | )% | ||||||||||||
Average shareholders’ equity (millions) | $ | 10,422 | $ | 10,426 | $ | 6,755 | — | 54 | ||||||||||
Average common total shareholders' equity (millions) | 9,351 | 9,355 | 6,322 | — | 48 | |||||||||||||
Average tangible common shareholders' equity (millions) | 7,101 | 7,080 | 5,610 | — | 27 | |||||||||||||
Total assets at end of period (millions) | 100,046 | 99,714 | 72,645 | — | 38 | |||||||||||||
Total shareholders’ equity at end of period (millions) | 10,437 | 10,308 | 7,158 | 1 | 46 | |||||||||||||
NCOs as a % of average loans and leases | 0.24 | % | 0.26 | % | 0.07 | % | ||||||||||||
NAL ratio | 0.60 | 0.63 | 0.97 | |||||||||||||||
NPA ratio(6) | 0.68 | 0.72 | 1.02 | |||||||||||||||
Allowance for loan and lease losses (ALLL) as a % of total loans and leases at the end of period | 1.00 | 0.95 | 1.19 | |||||||||||||||
ALLL plus allowance for unfunded loan commitments and letters of credit (ACL) as a % of total loans and leases at the end of period | 1.14 | 1.10 | 1.34 | |||||||||||||||
ACL as a % of NALs | 190 | 174 | 138 | |||||||||||||||
ACL as a % of NPAs | 167 | 153 | 131 | |||||||||||||||
Common equity tier 1 risk-based capital ratio(7) | 9.67 | 9.56 | 9.73 | |||||||||||||||
Tangible common equity / tangible asset ratio(8) | 7.28 | 7.16 | 7.89 | |||||||||||||||
See Notes to the Quarterly Key Statistics.
1
Key Statistics Footnotes
(1) | Comparisons for all presented periods are impacted by a number of factors. Refer to Significant Items. |
(2) | Net income applicable to common shares excluding expense for amortization of intangibles for the period divided by average tangible common shareholders’ equity. Average tangible common shareholders’ equity equals average total common 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. |
(3) | On a fully-taxable equivalent (FTE) basis assuming a 35% tax rate. |
(4) | Noninterest expense less amortization of intangibles divided by the sum of FTE net interest income and noninterest income excluding securities gains (losses). |
(5) | Includes noninterest-bearing and interest-bearing demand deposits, money market deposits, savings and other domestic deposits, and core certificates of deposit. |
(6) | NPAs include other real estate owned. |
(7) | March 31, 2017, figures are estimated. |
(8) | 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. |
2
Huntington Bancshares Incorporated
Consolidated Balance Sheets
March 31, | December 31, | |||||||||
(dollar amounts in thousands, except number of shares) | 2017 | 2016 | Percent Changes | |||||||
(Unaudited) | ||||||||||
Assets | ||||||||||
Cash and due from banks | $ | 1,308,813 | $ | 1,384,770 | (5 | )% | ||||
Interest-bearing deposits in banks | 63,055 | 58,267 | 8 | |||||||
Trading account securities | 97,785 | 133,295 | (27 | ) | ||||||
Loans held for sale | 518,238 | 512,951 | 1 | |||||||
Available-for-sale and other securities | 16,173,605 | 15,562,837 | 4 | |||||||
Held-to-maturity securities | 7,533,517 | 7,806,939 | (4 | ) | ||||||
Loans and leases(1) | 67,098,269 | 66,961,996 | — | |||||||
Allowance for loan and lease losses | (672,580 | ) | (638,413 | ) | 5 | |||||
Net loans and leases | 66,425,689 | 66,323,583 | — | |||||||
Bank owned life insurance | 2,445,545 | 2,432,086 | 1 | |||||||
Premises and equipment | 852,582 | 815,508 | 5 | |||||||
Goodwill | 1,992,849 | 1,992,849 | — | |||||||
Other intangible assets | 388,103 | 402,458 | (4 | ) | ||||||
Servicing rights | 227,678 | 225,578 | 1 | |||||||
Accrued income and other assets | 2,018,047 | 2,062,976 | (2 | ) | ||||||
Total assets | $ | 100,045,506 | $ | 99,714,097 | — | % | ||||
Liabilities and shareholders’ equity | ||||||||||
Liabilities | ||||||||||
Deposits(2) | $ | 77,422,510 | $ | 75,607,717 | 2 | % | ||||
Short-term borrowings | 1,263,430 | 3,692,654 | (66 | ) | ||||||
Long-term debt | 9,279,140 | 8,309,159 | 12 | |||||||
Accrued expenses and other liabilities | 1,643,279 | 1,796,421 | (9 | ) | ||||||
Total liabilities | 89,608,359 | 89,405,951 | — | |||||||
Shareholders' equity | ||||||||||
Preferred stock | 1,071,227 | 1,071,227 | — | |||||||
Common stock | 10,900 | 10,886 | — | |||||||
Capital surplus | 9,898,889 | 9,881,277 | — | |||||||
Less treasury shares, at cost | (26,765 | ) | (27,384 | ) | (2 | ) | ||||
Accumulated other comprehensive loss | (390,860 | ) | (401,016 | ) | (3 | ) | ||||
Retained (deficit) earnings | (126,244 | ) | (226,844 | ) | (44 | ) | ||||
Total shareholders’ equity | 10,437,147 | 10,308,146 | 1 | |||||||
Total liabilities and shareholders’ equity | $ | 100,045,506 | $ | 99,714,097 | — | % | ||||
Common shares authorized (par value of $0.01) | 1,500,000,000 | 1,500,000,000 | ||||||||
Common shares issued | 1,089,986,453 | 1,088,641,251 | ||||||||
Common shares outstanding | 1,087,119,978 | 1,085,688,538 | ||||||||
Treasury shares outstanding | 2,866,475 | 2,952,713 | ||||||||
Preferred stock, authorized shares | 6,617,808 | 6,617,808 | ||||||||
Preferred shares issued | 2,705,571 | 2,702,571 | ||||||||
Preferred shares outstanding | 1,098,006 | 1,098,006 | ||||||||
(1) | See pages 4 for detail of loans and leases. |
(2) | See page 5 for detail of deposits. |
3
Huntington Bancshares Incorporated
Loans and Leases Composition
(Unaudited)
March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||||||||||||||
(dollar amounts in millions) | 2017 | 2016 | 2016 | 2016 | 2016 | |||||||||||||||||||||||||||||
Ending Balances by Type: | ||||||||||||||||||||||||||||||||||
Commercial: | ||||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 28,176 | 42 | % | $ | 28,059 | 42 | % | $ | 27,668 | 42 | % | $ | 21,372 | 41 | % | $ | 21,254 | 41 | % | ||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||||||||
Construction | 1,107 | 2 | 1,446 | 2 | 1,414 | 2 | 856 | 2 | 939 | 2 | ||||||||||||||||||||||||
Commercial | 5,986 | 9 | 5,855 | 9 | 5,842 | 9 | 4,466 | 7 | 4,343 | 8 | ||||||||||||||||||||||||
Commercial real estate | 7,093 | 11 | 7,301 | 11 | 7,256 | 11 | 5,322 | 9 | 5,282 | 10 | ||||||||||||||||||||||||
Total commercial | 35,269 | 53 | 35,360 | 53 | 34,924 | 53 | 26,694 | 50 | 26,536 | 51 | ||||||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||||||||||
Automobile | 11,155 | 17 | 10,969 | 16 | 10,791 | 16 | 10,381 | 20 | 9,920 | 19 | ||||||||||||||||||||||||
Home equity | 9,974 | 15 | 10,106 | 15 | 10,120 | 15 | 8,447 | 17 | 8,422 | 17 | ||||||||||||||||||||||||
Residential mortgage | 7,829 | 12 | 7,725 | 12 | 7,665 | 12 | 6,377 | 12 | 6,082 | 12 | ||||||||||||||||||||||||
RV and marine finance | 1,935 | 2 | 1,846 | 3 | 1,840 | 3 | — | — | — | — | ||||||||||||||||||||||||
Other consumer | 936 | 1 | 956 | 1 | 964 | 1 | 644 | 1 | 579 | 1 | ||||||||||||||||||||||||
Total consumer | 31,829 | 47 | 31,602 | 47 | 31,380 | 47 | 25,849 | 50 | 25,003 | 49 | ||||||||||||||||||||||||
Total loans and leases | $ | 67,098 | 100 | % | $ | 66,962 | 100 | % | $ | 66,304 | 100 | % | $ | 52,543 | 100 | % | $ | 51,539 | 100 | % | ||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||||||||||||||
(dollar amounts in millions) | 2017 | 2016 | 2016 | 2016 | 2016 | |||||||||||||||||||||||||||||
Ending Balances by Business Segment: | ||||||||||||||||||||||||||||||||||
Consumer and Business Banking | $ | 17,524 | 26 | % | $ | 17,629 | 26 | % | $ | 17,658 | 27 | % | $ | 13,811 | 26 | % | $ | 13,637 | 26 | % | ||||||||||||||
Commercial Banking | 19,105 | 28 | 19,255 | 29 | 19,151 | 29 | 14,202 | 27 | 14,073 | 27 | ||||||||||||||||||||||||
CREVF | 22,791 | 34 | 22,491 | 34 | 22,043 | 33 | 17,800 | 34 | 17,412 | 34 | ||||||||||||||||||||||||
RBHPCG | 4,690 | 7 | 4,673 | 7 | 4,618 | 7 | 4,024 | 8 | 3,876 | 8 | ||||||||||||||||||||||||
Home Lending | 2,854 | 5 | 2,801 | 4 | 2,768 | 4 | 2,659 | 5 | 2,552 | 5 | ||||||||||||||||||||||||
Treasury / Other | 134 | — | 113 | — | 66 | — | 47 | — | (11 | ) | — | |||||||||||||||||||||||
Total loans and leases | $ | 67,098 | 100 | % | $ | 66,962 | 100 | % | $ | 66,304 | 100 | % | $ | 52,543 | 100 | % | $ | 51,539 | 100 | % | ||||||||||||||
Average Balances by Business Segment: | ||||||||||||||||||||||||||||||||||
Consumer and Business Banking | $ | 17,611 | 26 | % | $ | 17,643 | 27 | % | $ | 15,731 | 26 | % | $ | 13,730 | 26 | % | $ | 13,619 | 27 | % | ||||||||||||||
Commercial Banking | 19,202 | 29 | 19,002 | 29 | 17,159 | 28 | 14,033 | 27 | 13,499 | 27 | ||||||||||||||||||||||||
CREVF | 22,620 | 34 | 22,224 | 33 | 20,699 | 34 | 17,554 | 34 | 17,023 | 34 | ||||||||||||||||||||||||
RBHPCG | 4,640 | 7 | 4,631 | 7 | 4,318 | 8 | 3,934 | 8 | 3,852 | 7 | ||||||||||||||||||||||||
Home Lending | 2,822 | 4 | 2,774 | 4 | 2,702 | 4 | 2,583 | 5 | 2,533 | 5 | ||||||||||||||||||||||||
Treasury / Other | 86 | — | 131 | — | 113 | — | 98 | — | 92 | — | ||||||||||||||||||||||||
Total loans and leases | $ | 66,981 | 100 | % | $ | 66,405 | 100 | % | $ | 60,722 | 100 | % | $ | 51,932 | 100 | % | $ | 50,618 | 100 | % | ||||||||||||||
4
Huntington Bancshares Incorporated
Deposits Composition
(Unaudited)
March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||||||||||||||
(dollar amounts in millions) | 2017 | 2016 | 2016 | 2016 | 2016 | |||||||||||||||||||||||||||||
Ending Balances by Type: | ||||||||||||||||||||||||||||||||||
Demand deposits - noninterest-bearing | $ | 21,489 | 28 | % | $ | 22,836 | 30 | % | $ | 23,426 | 30 | % | $ | 16,324 | 30 | % | $ | 16,571 | 30 | % | ||||||||||||||
Demand deposits - interest-bearing | 18,618 | 24 | 15,676 | 21 | 15,730 | 20 | 8,412 | 15 | 8,174 | 15 | ||||||||||||||||||||||||
Money market deposits | 18,664 | 24 | 18,407 | 24 | 18,604 | 24 | 19,480 | 34 | 19,844 | 35 | ||||||||||||||||||||||||
Savings and other domestic deposits | 12,043 | 16 | 11,975 | 16 | 12,418 | 16 | 5,341 | 10 | 5,423 | 10 | ||||||||||||||||||||||||
Core certificates of deposit | 2,188 | 3 | 2,535 | 3 | 2,724 | 4 | 1,866 | 4 | 2,123 | 4 | ||||||||||||||||||||||||
Total core deposits | 73,002 | 95 | 71,429 | 94 | 72,902 | 94 | 51,423 | 93 | 52,135 | 94 | ||||||||||||||||||||||||
Other domestic deposits of $250,000 or more | 524 | 1 | 394 | 1 | 391 | 1 | 380 | 1 | 424 | 1 | ||||||||||||||||||||||||
Brokered deposits and negotiable CDs | 3,897 | 4 | 3,784 | 5 | 3,972 | 5 | 3,017 | 6 | 2,890 | 5 | ||||||||||||||||||||||||
Deposits in foreign offices | — | — | — | — | 140 | — | 223 | — | 180 | — | ||||||||||||||||||||||||
Total deposits | $ | 77,423 | 100 | % | $ | 75,608 | 100 | % | $ | 77,405 | 100 | % | $ | 55,043 | 100 | % | $ | 55,629 | 100 | % | ||||||||||||||
Total core deposits: | ||||||||||||||||||||||||||||||||||
Commercial | $ | 32,963 | 45 | % | $ | 31,887 | 45 | % | $ | 32,936 | 45 | % | $ | 24,308 | 47 | % | $ | 24,543 | 47 | % | ||||||||||||||
Consumer | 40,039 | 55 | 39,542 | 55 | 39,966 | 55 | 27,115 | 53 | 27,592 | 53 | ||||||||||||||||||||||||
Total core deposits | $ | 73,002 | 100 | % | $ | 71,429 | 100 | % | $ | 72,902 | 100 | % | $ | 51,423 | 100 | % | $ | 52,135 | 100 | % | ||||||||||||||
Ending Balances by Business Segment: | ||||||||||||||||||||||||||||||||||
Consumer and Business Banking | $ | 45,803 | 59 | % | $ | 44,861 | 59 | % | $ | 45,082 | 58 | % | $ | 31,287 | 57 | % | $ | 31,502 | 57 | % | ||||||||||||||
Commercial Banking | 19,042 | 25 | 15,616 | 21 | 16,434 | 21 | 10,353 | 19 | 11,258 | 20 | ||||||||||||||||||||||||
CREVF | 1,890 | 2 | 1,887 | 2 | 1,772 | 2 | 1,693 | 3 | 1,608 | 3 | ||||||||||||||||||||||||
RBHPCG | 5,982 | 8 | 8,521 | 11 | 8,705 | 11 | 7,970 | 14 | 7,690 | 14 | ||||||||||||||||||||||||
Home Lending | 350 | — | 639 | 1 | 500 | 1 | 335 | 1 | 334 | 1 | ||||||||||||||||||||||||
Treasury / Other(1) | 4,356 | 6 | 4,084 | 6 | 4,912 | 7 | 3,405 | 6 | 3,237 | 5 | ||||||||||||||||||||||||
Total deposits | $ | 77,423 | 100 | % | $ | 75,608 | 100 | % | $ | 77,405 | 100 | % | $ | 55,043 | 100 | % | $ | 55,629 | 100 | % | ||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||||||||||||||||
(dollar amounts in millions) | 2017 | 2016 | 2016 | 2016 | 2016 | |||||||||||||||||||||||||||||
Average Balances by Business Segment: | ||||||||||||||||||||||||||||||||||
Consumer and Business Banking | $ | 44,636 | 59 | % | $ | 45,109 | 59 | % | $ | 38,076 | 57 | % | $ | 31,484 | 57 | % | $ | 30,985 | 56 | % | ||||||||||||||
Commercial Banking | 18,731 | 25 | 16,003 | 21 | 13,664 | 21 | 10,769 | 19 | 11,375 | 20 | ||||||||||||||||||||||||
CREVF | 1,800 | 2 | 1,887 | 2 | 1,704 | 3 | 1,656 | 3 | 1,629 | 3 | ||||||||||||||||||||||||
RBHPCG | 5,918 | 8 | 8,616 | 11 | 8,326 | 13 | 7,876 | 14 | 7,480 | 14 | ||||||||||||||||||||||||
Home Lending | 579 | 1 | 606 | 1 | 447 | 1 | 386 | 1 | 316 | 1 | ||||||||||||||||||||||||
Treasury / Other(1) | 4,275 | 5 | 4,665 | 6 | 4,285 | 5 | 3,243 | 6 | 3,194 | 6 | ||||||||||||||||||||||||
Total deposits | $ | 75,939 | 100 | % | $ | 76,886 | 100 | % | $ | 66,502 | 100 | % | $ | 55,414 | 100 | % | $ | 54,979 | 100 | % | ||||||||||||||
(1) | Comprised primarily of national market deposits. |
5
Huntington Bancshares Incorporated
Consolidated Quarterly Average Balance Sheets
(Unaudited)
Quarterly Average Balances (2) | ||||||||||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | Percent Changes vs. | |||||||||||||||||||||
(dollar amounts in millions) | 2017 | 2016 | 2016 | 2016 | 2016 | 4Q16 | 1Q16 | |||||||||||||||||||
Assets | ||||||||||||||||||||||||||
Interest-bearing deposits in banks | $ | 100 | $ | 110 | $ | 95 | $ | 99 | $ | 98 | (10 | )% | 2 | % | ||||||||||||
Loans held for sale | 415 | 2,507 | 695 | 571 | 433 | (83 | ) | (4 | ) | |||||||||||||||||
Securities: | ||||||||||||||||||||||||||
Available-for-sale and other securities: | ||||||||||||||||||||||||||
Taxable | 12,800 | 13,734 | 9,785 | 6,904 | 6,633 | (7 | ) | 93 | ||||||||||||||||||
Tax-exempt | 3,049 | 3,136 | 2,854 | 2,510 | 2,358 | (3 | ) | 29 | ||||||||||||||||||
Total available-for-sale and other securities | 15,849 | 16,870 | 12,639 | 9,414 | 8,991 | (6 | ) | 76 | ||||||||||||||||||
Trading account securities | 137 | 139 | 49 | 41 | 40 | (1 | ) | 245 | ||||||||||||||||||
Held-to-maturity securities - taxable | 7,656 | 5,432 | 5,487 | 5,806 | 6,054 | 41 | 26 | |||||||||||||||||||
Total securities | 23,643 | 22,441 | 18,175 | 15,261 | 15,085 | 5 | 57 | |||||||||||||||||||
Loans and leases:(1) | ||||||||||||||||||||||||||
Commercial: | ||||||||||||||||||||||||||
Commercial and industrial | 27,922 | 27,727 | 24,957 | 21,344 | 20,649 | 1 | 35 | |||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||
Construction | 1,314 | 1,413 | 1,132 | 881 | 923 | (7 | ) | 42 | ||||||||||||||||||
Commercial | 6,039 | 5,805 | 5,227 | 4,345 | 4,283 | 4 | 41 | |||||||||||||||||||
Commercial real estate | 7,353 | 7,218 | 6,359 | 5,226 | 5,206 | 2 | 41 | |||||||||||||||||||
Total commercial | 35,276 | 34,945 | 31,316 | 26,570 | 25,855 | 1 | 36 | |||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Automobile | 11,063 | 10,866 | 11,402 | 10,146 | 9,730 | 2 | 14 | |||||||||||||||||||
Home equity | 10,072 | 10,101 | 9,260 | 8,416 | 8,441 | — | 19 | |||||||||||||||||||
Residential mortgage | 7,777 | 7,690 | 7,012 | 6,187 | 6,018 | 1 | 29 | |||||||||||||||||||
RV and marine finance | 1,874 | 1,844 | 915 | — | — | 2 | N.R. | |||||||||||||||||||
Other consumer | 919 | 959 | 817 | 613 | 574 | (4 | ) | 60 | ||||||||||||||||||
Total consumer | 31,705 | 31,460 | 29,406 | 25,362 | 24,763 | 1 | 28 | |||||||||||||||||||
Total loans and leases | 66,981 | 66,405 | 60,722 | 51,932 | 50,618 | 1 | 32 | |||||||||||||||||||
Allowance for loan and lease losses | (636 | ) | (614 | ) | (623 | ) | (616 | ) | (604 | ) | 4 | 5 | ||||||||||||||
Net loans and leases | 66,345 | 65,791 | 60,099 | 51,316 | 50,014 | 1 | 33 | |||||||||||||||||||
Total earning assets | 91,139 | 91,463 | 79,687 | 67,863 | 66,234 | — | 38 | |||||||||||||||||||
Cash and due from banks | 2,011 | 1,538 | 1,325 | 1,001 | 1,013 | 31 | 99 | |||||||||||||||||||
Intangible assets | 2,387 | 2,421 | 1,547 | 726 | 730 | (1 | ) | 227 | ||||||||||||||||||
All other assets | 5,442 | 5,559 | 4,962 | 4,149 | 4,223 | (2 | ) | 29 | ||||||||||||||||||
Total assets | $ | 100,343 | $ | 100,367 | $ | 86,898 | $ | 73,123 | $ | 71,596 | — | % | 40 | % | ||||||||||||
Liabilities and shareholders’ equity | ||||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||||
Demand deposits - noninterest-bearing | $ | 21,730 | $ | 23,250 | $ | 20,033 | $ | 16,507 | $ | 16,334 | (7 | )% | 33 | % | ||||||||||||
Demand deposits - interest-bearing | 16,805 | 15,294 | 12,362 | 8,445 | 7,776 | 10 | 116 | |||||||||||||||||||
Total demand deposits | 38,535 | 38,544 | 32,395 | 24,952 | 24,110 | — | 60 | |||||||||||||||||||
Money market deposits | 18,653 | 18,618 | 18,453 | 19,534 | 19,682 | — | (5 | ) | ||||||||||||||||||
Savings and other domestic deposits | 11,970 | 12,272 | 8,889 | 5,402 | 5,306 | (2 | ) | 126 | ||||||||||||||||||
Core certificates of deposit | 2,342 | 2,636 | 2,285 | 2,007 | 2,265 | (11 | ) | 3 | ||||||||||||||||||
Total core deposits | 71,500 | 72,070 | 62,022 | 51,895 | 51,363 | (1 | ) | 39 | ||||||||||||||||||
Other domestic deposits of $250,000 or more | 470 | 391 | 382 | 402 | 455 | 20 | 3 | |||||||||||||||||||
Brokered deposits and negotiable CDs | 3,969 | 4,273 | 3,904 | 2,909 | 2,897 | (7 | ) | 37 | ||||||||||||||||||
Deposits in foreign offices | — | 152 | 194 | 208 | 264 | — | — | |||||||||||||||||||
Total deposits | 75,939 | 76,886 | 66,502 | 55,414 | 54,979 | (1 | ) | 38 | ||||||||||||||||||
Short-term borrowings | 3,792 | 2,628 | 1,306 | 1,032 | 1,145 | 44 | 231 | |||||||||||||||||||
Long-term debt | 8,529 | 8,594 | 8,488 | 7,899 | 7,202 | (1 | ) | 18 | ||||||||||||||||||
Total interest-bearing liabilities | 66,530 | 64,858 | 56,263 | 47,838 | 46,992 | 3 | 42 | |||||||||||||||||||
All other liabilities | 1,661 | 1,833 | 1,608 | 1,416 | 1,515 | (9 | ) | 10 | ||||||||||||||||||
Shareholders’ equity | 10,422 | 10,426 | 8,994 | 7,362 | 6,755 | — | 54 | |||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 100,343 | $ | 100,367 | $ | 86,898 | $ | 73,123 | $ | 71,596 | — | % | 40 | % | ||||||||||||
N.R. Not relevant.
(1) | Includes nonaccrual loans. |
(2) | Amounts include the effects of hedge and risk management activities associated with the respective asset and liability categories. |
6
Huntington Bancshares Incorporated
Consolidated Quarterly Net Interest Margin - Interest Income / Expense(1)(2)
(Unaudited)
Quarterly Interest Income / Expense | |||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Assets | |||||||||||||||||||
Interest-bearing deposits in banks | $ | 271 | $ | 177 | $ | 152 | $ | 63 | $ | 51 | |||||||||
Loans held for sale | 3,958 | 18,477 | 6,135 | 5,546 | 4,322 | ||||||||||||||
Securities: | |||||||||||||||||||
Available-for-sale and other securities: | |||||||||||||||||||
Taxable | 76,109 | 83,604 | 57,572 | 40,992 | 39,614 | ||||||||||||||
Tax-exempt | 28,926 | 28,245 | 21,474 | 21,223 | 20,030 | ||||||||||||||
Total available-for-sale and other securities | 105,035 | 111,849 | 79,046 | 62,215 | 59,644 | ||||||||||||||
Trading account securities | 38 | 62 | 71 | 101 | 50 | ||||||||||||||
Held-to-maturity securities - taxable | 45,195 | 33,005 | 33,098 | 35,420 | 36,789 | ||||||||||||||
Total securities | 150,268 | 144,916 | 112,215 | 97,736 | 96,483 | ||||||||||||||
Loans and leases: | |||||||||||||||||||
Commercial: | |||||||||||||||||||
Commercial and industrial | 277,812 | 271,715 | 234,853 | 188,375 | 183,930 | ||||||||||||||
Commercial real estate: | |||||||||||||||||||
Construction | 12,959 | 13,172 | 10,866 | 8,231 | 8,198 | ||||||||||||||
Commercial | 55,746 | 52,555 | 47,353 | 36,763 | 38,820 | ||||||||||||||
Commercial real estate | 68,705 | 65,728 | 58,219 | 44,994 | 47,018 | ||||||||||||||
Total commercial | 346,517 | 337,442 | 293,072 | 233,369 | 230,948 | ||||||||||||||
Consumer: | |||||||||||||||||||
Automobile | 96,934 | 97,482 | 96,585 | 79,574 | 76,717 | ||||||||||||||
Home equity | 110,545 | 107,637 | 98,014 | 87,279 | 88,072 | ||||||||||||||
Residential mortgage | 70,614 | 68,841 | 63,217 | 56,509 | 55,510 | ||||||||||||||
RV and marine finance | 26,001 | 26,141 | 13,102 | — | — | ||||||||||||||
Other consumer | 27,310 | 26,305 | 22,452 | 15,673 | 14,307 | ||||||||||||||
Total consumer | 331,404 | 326,406 | 293,370 | 239,035 | 234,606 | ||||||||||||||
Total loans and leases | 677,921 | 663,848 | 586,442 | 472,404 | 465,554 | ||||||||||||||
Total earning assets | $ | 832,418 | $ | 827,418 | $ | 704,944 | $ | 575,749 | $ | 566,410 | |||||||||
Liabilities | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Demand deposits - noninterest-bearing | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||
Demand deposits - interest-bearing | 6,366 | 4,230 | 3,430 | 1,939 | 1,679 | ||||||||||||||
Total demand deposits | 6,366 | 4,230 | 3,430 | 1,939 | 1,679 | ||||||||||||||
Money market deposits | 12,057 | 11,022 | 10,945 | 11,676 | 11,768 | ||||||||||||||
Savings and other domestic deposits | 6,573 | 7,631 | 4,604 | 1,442 | 1,660 | ||||||||||||||
Core certificates of deposit | 2,254 | 1,931 | 2,469 | 3,938 | 4,623 | ||||||||||||||
Total core deposits | 27,250 | 24,814 | 21,448 | 18,995 | 19,730 | ||||||||||||||
Other domestic deposits of $250,000 or more | 523 | 379 | 386 | 399 | 460 | ||||||||||||||
Brokered deposits and negotiable CDs | 7,016 | 5,186 | 4,336 | 2,861 | 2,742 | ||||||||||||||
Deposits in foreign offices | — | 51 | 63 | 68 | 86 | ||||||||||||||
Total deposits | 34,789 | 30,430 | 26,233 | 22,323 | 23,018 | ||||||||||||||
Short-term borrowings | 5,866 | 2,370 | 959 | 913 | 898 | ||||||||||||||
Long-term debt | 49,730 | 47,077 | 41,764 | 36,541 | 30,269 | ||||||||||||||
Total interest bearing liabilities | 90,385 | 79,877 | 68,956 | 59,777 | 54,185 | ||||||||||||||
Net interest income | $ | 742,033 | $ | 747,541 | $ | 635,988 | $ | 515,972 | $ | 512,225 | |||||||||
(1) | Fully-taxable equivalent (FTE) income and expense calculated assuming a 35% tax rate. See page 10 for the FTE adjustment. |
(2) | Amounts include the effects of hedge and risk management activities associated with the respective asset and liability categories. |
7
Huntington Bancshares Incorporated
Consolidated Quarterly Net Interest Margin - Yield
(Unaudited)
Quarterly Average Rates(2) | ||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||
Fully-taxable equivalent basis(1) | 2017 | 2016 | 2016 | 2016 | 2016 | |||||||||
Assets | ||||||||||||||
Interest-bearing deposits in banks | 1.09 | % | 0.64 | % | 0.64 | % | 0.25 | % | 0.21 | % | ||||
Loans held for sale | 3.82 | 2.95 | 3.53 | 3.89 | 3.99 | |||||||||
Securities: | ||||||||||||||
Available-for-sale and other securities: | ||||||||||||||
Taxable | 2.38 | 2.43 | 2.35 | 2.37 | 2.39 | |||||||||
Tax-exempt | 3.79 | 3.60 | 3.01 | 3.38 | 3.40 | |||||||||
Total available-for-sale and other securities | 2.65 | 2.65 | 2.50 | 2.64 | 2.65 | |||||||||
Trading account securities | 0.11 | 0.18 | 0.58 | 0.98 | 0.50 | |||||||||
Held-to-maturity securities - taxable | 2.36 | 2.43 | 2.41 | 2.44 | 2.43 | |||||||||
Total securities | 2.54 | 2.58 | 2.47 | 2.56 | 2.56 | |||||||||
Loans and leases:(3) | ||||||||||||||
Commercial: | ||||||||||||||
Commercial and industrial | 3.98 | 3.83 | 3.68 | 3.49 | 3.52 | |||||||||
Commercial real estate: | ||||||||||||||
Construction | 3.95 | 3.65 | 3.76 | 3.70 | 3.51 | |||||||||
Commercial | 3.69 | 3.54 | 3.54 | 3.35 | 3.59 | |||||||||
Commercial real estate | 3.74 | 3.56 | 3.58 | 3.41 | 3.57 | |||||||||
Total commercial | 3.93 | 3.78 | 3.66 | 3.47 | 3.53 | |||||||||
Consumer: | ||||||||||||||
Automobile | 3.55 | 3.57 | 3.37 | 3.15 | 3.17 | |||||||||
Home equity | 4.45 | 4.24 | 4.21 | 4.17 | 4.20 | |||||||||
Residential mortgage | 3.63 | 3.58 | 3.61 | 3.65 | 3.69 | |||||||||
RV and marine finance | 5.63 | 5.64 | 5.70 | — | — | |||||||||
Other consumer | 12.05 | 10.91 | 10.93 | 10.28 | 10.02 | |||||||||
Total consumer | 4.23 | 4.13 | 3.97 | 3.79 | 3.81 | |||||||||
Total loans and leases | 4.07 | 3.95 | 3.81 | 3.63 | 3.67 | |||||||||
Total earning assets | 3.70 | 3.60 | 3.52 | 3.41 | 3.44 | |||||||||
Liabilities | ||||||||||||||
Deposits: | ||||||||||||||
Demand deposits - noninterest-bearing | — | — | — | — | — | |||||||||
Demand deposits - interest-bearing | 0.15 | 0.11 | 0.11 | 0.09 | 0.09 | |||||||||
Total demand deposits | 0.07 | 0.04 | 0.04 | 0.03 | 0.03 | |||||||||
Money market deposits | 0.26 | 0.24 | 0.24 | 0.24 | 0.24 | |||||||||
Savings and other domestic deposits | 0.22 | 0.25 | 0.21 | 0.11 | 0.13 | |||||||||
Core certificates of deposit | 0.39 | 0.29 | 0.43 | 0.79 | 0.82 | |||||||||
Total core deposits | 0.22 | 0.20 | 0.20 | 0.22 | 0.23 | |||||||||
Other domestic deposits of $250,000 or more | 0.45 | 0.39 | 0.40 | 0.40 | 0.41 | |||||||||
Brokered deposits and negotiable CDs | 0.72 | 0.48 | 0.44 | 0.40 | 0.38 | |||||||||
Deposits in foreign offices | — | 0.13 | 0.13 | 0.13 | 0.13 | |||||||||
Total deposits | 0.26 | 0.23 | 0.22 | 0.23 | 0.24 | |||||||||
Short-term borrowings | 0.63 | 0.36 | 0.29 | 0.36 | 0.32 | |||||||||
Long-term debt | 2.33 | 2.19 | 1.97 | 1.85 | 1.68 | |||||||||
Total interest-bearing liabilities | 0.54 | 0.48 | 0.49 | 0.50 | 0.46 | |||||||||
Net interest rate spread | 3.16 | 3.12 | 3.03 | 2.91 | 2.98 | |||||||||
Impact of noninterest-bearing funds on margin | 0.14 | 0.13 | 0.15 | 0.15 | 0.13 | |||||||||
Net interest margin | 3.30 | % | 3.25 | % | 3.18 | % | 3.06 | % | 3.11 | % | ||||
Commercial Loan Derivative Impact
(Unaudited)
Average Rates | ||||||||||||||
2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||
Fully-taxable equivalent basis(1) | First | Fourth | Third | Second | First | |||||||||
Commercial loans(2)(3) | 3.93 | % | 3.76 | % | 3.62 | % | 3.40 | % | 3.44 | % | ||||
Impact of commercial loan derivatives | — | 0.02 | 0.04 | 0.07 | 0.09 | |||||||||
Total commercial - as reported | 3.93 | % | 3.78 | % | 3.66 | % | 3.47 | % | 3.53 | % | ||||
Average 30 day LIBOR | 0.80 | % | 0.59 | % | 0.51 | % | 0.44 | % | 0.43 | % | ||||
(1) | Fully-taxable equivalent (FTE) yields are calculated assuming a 35% tax rate. See page 10 for the FTE adjustment. |
(2) | Yield/rates include the effects of hedge and risk management activities associated with the respective asset and liability categories. |
(3) | Includes nonaccrual loans. |
8
Huntington Bancshares Incorporated
Selected Quarterly Income Statement Data(1)
(Unaudited)
Three months ended | |||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands, except share amounts) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Interest income | $ | 820,360 | $ | 814,858 | $ | 694,346 | $ | 565,658 | $ | 557,251 | |||||||||
Interest expense | 90,385 | 79,877 | 68,956 | 59,777 | 54,185 | ||||||||||||||
Net interest income | 729,975 | 734,981 | 625,390 | 505,881 | 503,066 | ||||||||||||||
Provision for credit losses | 67,638 | 74,906 | 63,805 | 24,509 | 27,582 | ||||||||||||||
Net interest income after provision for credit losses | 662,337 | 660,075 | 561,585 | 481,372 | 475,484 | ||||||||||||||
Service charges on deposit accounts | 83,420 | 91,577 | 86,847 | 75,613 | 70,262 | ||||||||||||||
Cards and payment processing income | 47,169 | 49,113 | 44,320 | 39,184 | 36,447 | ||||||||||||||
Mortgage banking income | 31,692 | 37,520 | 40,603 | 31,591 | 18,543 | ||||||||||||||
Trust and investment management services | 33,869 | 34,016 | 28,923 | 22,497 | 22,838 | ||||||||||||||
Insurance income | 15,264 | 16,486 | 15,865 | 15,947 | 16,225 | ||||||||||||||
Brokerage income | 15,758 | 17,014 | 14,719 | 14,599 | 15,502 | ||||||||||||||
Capital markets fees | 14,200 | 18,730 | 14,750 | 13,037 | 13,010 | ||||||||||||||
Bank owned life insurance income | 17,542 | 17,067 | 14,452 | 12,536 | 13,513 | ||||||||||||||
Gain on sale of loans | 12,822 | 24,987 | 7,506 | 9,265 | 5,395 | ||||||||||||||
Securities gains (losses) | (8 | ) | (1,771 | ) | 1,031 | 656 | — | ||||||||||||
Other income | 40,735 | 29,598 | 33,399 | 36,187 | 30,132 | ||||||||||||||
Total noninterest income | 312,463 | 334,337 | 302,415 | 271,112 | 241,867 | ||||||||||||||
Personnel costs | 382,000 | 359,755 | 405,024 | 298,949 | 285,397 | ||||||||||||||
Outside data processing and other services | 87,202 | 88,695 | 91,133 | 63,037 | 61,878 | ||||||||||||||
Equipment | 46,700 | 59,666 | 40,792 | 31,805 | 32,576 | ||||||||||||||
Net occupancy | 67,700 | 49,450 | 41,460 | 30,704 | 31,476 | ||||||||||||||
Professional services | 18,295 | 23,165 | 47,075 | 21,488 | 13,538 | ||||||||||||||
Marketing | 13,923 | 21,478 | 14,438 | 14,773 | 12,268 | ||||||||||||||
Deposit and other insurance expense | 20,099 | 15,772 | 14,940 | 12,187 | 11,208 | ||||||||||||||
Amortization of intangibles | 14,355 | 14,099 | 9,046 | 3,600 | 3,712 | ||||||||||||||
Other expense | 57,148 | 49,417 | 48,339 | 47,118 | 39,027 | ||||||||||||||
Total noninterest expense | 707,422 | 681,497 | 712,247 | 523,661 | 491,080 | ||||||||||||||
Income before income taxes | 267,378 | 312,915 | 151,753 | 228,823 | 226,271 | ||||||||||||||
Provision for income taxes | 59,284 | 73,952 | 24,749 | 54,283 | 54,957 | ||||||||||||||
Net income | 208,094 | 238,963 | 127,004 | 174,540 | 171,314 | ||||||||||||||
Dividends on preferred shares | 18,878 | 18,865 | 18,537 | 19,874 | 7,998 | ||||||||||||||
Net income applicable to common shares | $ | 189,216 | $ | 220,098 | $ | 108,467 | $ | 154,666 | $ | 163,316 | |||||||||
Average common shares - basic | 1,086,374 | 1,085,253 | 938,578 | 798,167 | 795,755 | ||||||||||||||
Average common shares - diluted | 1,108,617 | 1,104,358 | 952,081 | 810,371 | 808,349 | ||||||||||||||
Per common share | |||||||||||||||||||
Net income - basic | $ | 0.17 | $ | 0.20 | $ | 0.12 | $ | 0.19 | $ | 0.21 | |||||||||
Net income - diluted | 0.17 | 0.20 | 0.11 | 0.19 | 0.20 | ||||||||||||||
Cash dividends declared | 0.08 | 0.08 | 0.07 | 0.07 | 0.07 | ||||||||||||||
Revenue - fully-taxable equivalent (FTE) | |||||||||||||||||||
Net interest income | $ | 729,975 | $ | 734,981 | $ | 625,390 | $ | 505,881 | $ | 503,066 | |||||||||
FTE adjustment | 12,058 | 12,560 | 10,598 | 10,091 | 9,159 | ||||||||||||||
Net interest income(2) | 742,033 | 747,541 | 635,988 | 515,972 | 512,225 | ||||||||||||||
Noninterest income | 312,463 | 334,337 | 302,415 | 271,112 | 241,867 | ||||||||||||||
Total revenue(2) | $ | 1,054,496 | $ | 1,081,878 | $ | 938,403 | $ | 787,084 | $ | 754,092 | |||||||||
(1) | Comparisons for presented periods are impacted by a number of factors. Refer to Significant Items. |
(2) | On a fully-taxable equivalent (FTE) basis assuming a 35% tax rate. |
9
Huntington Bancshares Incorporated
Quarterly Mortgage Banking Income
(Unaudited)
Three months ended | ||||||||||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | Percent Changes vs. | |||||||||||||||||||||
(dollar amounts in thousands, except as noted) | 2017 | 2016 | 2016 | 2016 | 2016 | 4Q16 | 1Q16 | |||||||||||||||||||
Mortgage banking income | ||||||||||||||||||||||||||
Origination and secondary marketing | $ | 21,388 | $ | 22,161 | $ | 32,741 | $ | 26,862 | $ | 18,533 | (3 | )% | 15 | % | ||||||||||||
Servicing fees | 13,014 | 12,601 | 11,656 | 11,010 | 11,137 | 3 | 17 | |||||||||||||||||||
Amortization of capitalized servicing | (6,683 | ) | (7,582 | ) | (7,681 | ) | (6,673 | ) | (6,405 | ) | (12 | ) | 4 | |||||||||||||
Other mortgage banking income | 2,588 | 2,862 | 2,790 | 2,323 | 1,672 | (10 | ) | 55 | ||||||||||||||||||
Subtotal | 30,307 | 30,042 | 39,506 | 33,522 | 24,937 | 1 | 22 | |||||||||||||||||||
MSR valuation adjustment(1) | 1,955 | 24,981 | 2,505 | (8,300 | ) | (18,329 | ) | (92 | ) | (111 | ) | |||||||||||||||
Net trading gains (losses) related to MSR hedging | (570 | ) | (17,503 | ) | (1,408 | ) | 6,369 | 11,935 | (97 | ) | (105 | ) | ||||||||||||||
Total mortgage banking income | $ | 31,692 | $ | 37,520 | $ | 40,603 | $ | 31,591 | $ | 18,543 | (16 | ) | 71 | |||||||||||||
Mortgage originations (in millions) | $ | 1,266 | $ | 1,542 | $ | 1,744 | $ | 1,600 | $ | 936 | (18 | ) | 35 | |||||||||||||
Capitalized mortgage servicing rights(2) | 191,119 | 186,213 | 156,820 | 134,397 | 142,094 | 3 | 35 | |||||||||||||||||||
Total mortgages serviced for others (in millions)(2) | 19,051 | 18,852 | 18,631 | 16,211 | 16,239 | 1 | 17 | |||||||||||||||||||
MSR % of investor servicing portfolio(2) | 1.00 | % | 0.99 | % | 0.84 | % | 0.83 | % | 0.88 | % | 1 | 14 | ||||||||||||||
Net impact of MSR hedging | ||||||||||||||||||||||||||
MSR valuation adjustment(1) | $ | 1,955 | $ | 24,981 | $ | 2,505 | $ | (8,300 | ) | $ | (18,329 | ) | (92 | ) | (111 | ) | ||||||||||
Net trading gains (losses) related to MSR hedging | (570 | ) | (17,503 | ) | (1,408 | ) | 6,369 | 11,935 | (97 | ) | (105 | ) | ||||||||||||||
Net gain (loss) of MSR hedging | $ | 1,385 | $ | 7,478 | $ | 1,097 | $ | (1,931 | ) | $ | (6,394 | ) | (81 | ) | (122 | ) | ||||||||||
(1) | The change in fair value for the period represents the MSR valuation adjustment, net of amortization of capitalized servicing. |
(2) | At period end. |
10
Huntington Bancshares Incorporated
Quarterly Credit Reserves Analysis
(Unaudited)
Three months ended | |||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Allowance for loan and lease losses, beginning of period | $ | 638,413 | $ | 616,898 | $ | 623,064 | $ | 613,719 | $ | 597,843 | |||||||||
Loan and lease losses | (70,715 | ) | (64,809 | ) | (59,268 | ) | (43,545 | ) | (59,692 | ) | |||||||||
Recoveries of loans previously charged off | 31,277 | 21,285 | 19,203 | 26,790 | 51,140 | ||||||||||||||
Net loan and lease losses | (39,438 | ) | (43,524 | ) | (40,065 | ) | (16,755 | ) | (8,552 | ) | |||||||||
Provision for loan and lease losses | 73,679 | 65,460 | 53,523 | 26,086 | 24,338 | ||||||||||||||
Allowance of assets sold or transferred to loans held for sale | (74 | ) | (421 | ) | (19,624 | ) | 14 | 90 | |||||||||||
Allowance for loan and lease losses, end of period | 672,580 | 638,413 | 616,898 | 623,064 | 613,719 | ||||||||||||||
Allowance for unfunded loan commitments and letters of credit, beginning of period | 97,879 | 88,433 | 73,748 | 75,325 | 72,081 | ||||||||||||||
Provision for (reduction in) unfunded loan commitments and letters of credit losses | (6,041 | ) | 9,446 | 10,282 | (1,577 | ) | 3,244 | ||||||||||||
Fair value of acquired AULC | — | — | 4,403 | — | — | ||||||||||||||
Allowance for unfunded loan commitments and letters of credit, end of period | 91,838 | 97,879 | 88,433 | 73,748 | 75,325 | ||||||||||||||
Total allowance for credit losses, end of period | $ | 764,418 | $ | 736,292 | $ | 705,331 | $ | 696,812 | $ | 689,044 | |||||||||
Allowance for loan and lease losses (ALLL) as % of: | |||||||||||||||||||
Total loans and leases | 1.00 | % | 0.95 | % | 0.93 | % | 1.19 | % | 1.19 | % | |||||||||
Nonaccrual loans and leases (NALs) | 168 | 151 | 153 | 135 | 123 | ||||||||||||||
Nonperforming assets (NPAs) | 147 | 133 | 130 | 127 | 117 | ||||||||||||||
Total allowance for credit losses (ACL) as % of: | |||||||||||||||||||
Total loans and leases | 1.14 | % | 1.10 | % | 1.06 | % | 1.33 | % | 1.34 | % | |||||||||
Nonaccrual loans and leases | 190 | 174 | 174 | 151 | 138 | ||||||||||||||
Nonperforming assets | 167 | 153 | 148 | 142 | 131 | ||||||||||||||
11
Huntington Bancshares Incorporated
Quarterly Net Charge-Off Analysis
(Unaudited)
Three months ended | |||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Net charge-offs (recoveries) by loan and lease type: | |||||||||||||||||||
Commercial: | |||||||||||||||||||
Commercial and industrial | $ | 11,223 | $ | 15,674 | $ | 19,225 | $ | 3,702 | $ | 6,514 | |||||||||
Commercial real estate: | |||||||||||||||||||
Construction | (3,137 | ) | (1,332 | ) | (271 | ) | (377 | ) | (104 | ) | |||||||||
Commercial | (2,232 | ) | (4,160 | ) | (2,427 | ) | (296 | ) | (17,372 | ) | |||||||||
Commercial real estate | (5,369 | ) | (5,492 | ) | (2,698 | ) | (673 | ) | (17,476 | ) | |||||||||
Total commercial | 5,854 | 10,182 | 16,527 | 3,029 | (10,962 | ) | |||||||||||||
Consumer: | |||||||||||||||||||
Automobile | 12,407 | 13,132 | 7,769 | 4,320 | 6,770 | ||||||||||||||
Home equity | 1,662 | 1,621 | 2,624 | 1,078 | 3,681 | ||||||||||||||
Residential mortgage | 2,595 | 1,673 | 1,728 | 776 | 1,647 | ||||||||||||||
RV and marine finance | 2,363 | 2,182 | 106 | — | — | ||||||||||||||
Other consumer | 14,557 | 14,734 | 11,311 | 7,552 | 7,416 | ||||||||||||||
Total consumer | 33,584 | 33,342 | 23,538 | 13,726 | 19,514 | ||||||||||||||
Total net charge-offs | $ | 39,438 | $ | 43,524 | $ | 40,065 | $ | 16,755 | $ | 8,552 | |||||||||
Three months ended | |||||||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
2017 | 2016 | 2016 | 2016 | 2016 | |||||||||||||||
Net charge-offs (recoveries)—annualized percentages: | |||||||||||||||||||
Commercial: | |||||||||||||||||||
Commercial and industrial | 0.16 | % | 0.23 | % | 0.31 | % | 0.07 | % | 0.13 | % | |||||||||
Commercial real estate: | |||||||||||||||||||
Construction | (0.96 | ) | (0.38 | ) | (0.10 | ) | (0.17 | ) | (0.05 | ) | |||||||||
Commercial | (0.15 | ) | (0.29 | ) | (0.19 | ) | (0.03 | ) | (1.62 | ) | |||||||||
Commercial real estate | (0.29 | ) | (0.30 | ) | (0.17 | ) | (0.05 | ) | (1.34 | ) | |||||||||
Total commercial | 0.07 | 0.12 | 0.21 | 0.05 | (0.17 | ) | |||||||||||||
Consumer: | |||||||||||||||||||
Automobile | 0.45 | 0.48 | 0.27 | 0.17 | 0.28 | ||||||||||||||
Home equity | 0.07 | 0.06 | 0.11 | 0.05 | 0.17 | ||||||||||||||
Residential mortgage | 0.13 | 0.09 | 0.10 | 0.05 | 0.11 | ||||||||||||||
RV and marine finance | 0.50 | 0.47 | 0.05 | — | — | ||||||||||||||
Other consumer | 6.33 | 6.14 | 5.54 | 4.93 | 5.17 | ||||||||||||||
Total consumer | 0.42 | 0.42 | 0.32 | 0.22 | 0.32 | ||||||||||||||
Net charge-offs as a % of average loans | 0.24 | % | 0.26 | % | 0.26 | % | 0.13 | % | 0.07 | % | |||||||||
12
Huntington Bancshares Incorporated
Quarterly Nonaccrual Loans and Leases (NALs) and Nonperforming Assets (NPAs)
(Unaudited)
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Nonaccrual loans and leases (NALs): | |||||||||||||||||||
Commercial and industrial | $ | 232,171 | $ | 234,184 | $ | 220,862 | $ | 289,811 | $ | 307,824 | |||||||||
Commercial real estate | 13,889 | 20,508 | 21,300 | 23,663 | 30,801 | ||||||||||||||
Automobile | 4,881 | 5,766 | 4,777 | 5,049 | 7,598 | ||||||||||||||
Residential mortgage | 80,686 | 90,502 | 88,155 | 85,174 | 90,303 | ||||||||||||||
RV and marine finance | 106 | 245 | 96 | — | — | ||||||||||||||
Home equity | 69,575 | 71,798 | 69,044 | 56,845 | 62,208 | ||||||||||||||
Other consumer | 2 | — | — | 5 | — | ||||||||||||||
Total nonaccrual loans and leases | 401,310 | 423,003 | 404,234 | 460,547 | 498,734 | ||||||||||||||
Other real estate: | |||||||||||||||||||
Residential | 31,786 | 30,932 | 34,421 | 26,653 | 23,175 | ||||||||||||||
Commercial | 18,101 | 19,998 | 36,915 | 2,248 | 2,957 | ||||||||||||||
Total other real estate | 49,887 | 50,930 | 71,336 | 28,901 | 26,132 | ||||||||||||||
Other NPAs (1) | 6,910 | 6,968 | — | 376 | — | ||||||||||||||
Total nonperforming assets | $ | 458,107 | $ | 480,901 | $ | 475,570 | $ | 489,824 | $ | 524,866 | |||||||||
Nonaccrual loans and leases as a % of total loans and leases | 0.60 | % | 0.63 | % | 0.61 | % | 0.88 | % | 0.97 | % | |||||||||
NPA ratio (3) | 0.68 | 0.72 | 0.72 | 0.93 | 1.02 | ||||||||||||||
(NPA+90days)/(Loan+OREO) (4) | 0.87 | 0.91 | 0.92 | 1.12 | 1.22 | ||||||||||||||
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Nonperforming assets, beginning of period | $ | 480,901 | $ | 475,570 | $ | 489,824 | $ | 524,866 | $ | 398,923 | |||||||||
New nonperforming assets | 124,550 | 150,368 | 166,966 | 74,577 | 240,707 | ||||||||||||||
Returns to accruing status | (22,441 | ) | (12,630 | ) | (81,086 | ) | (18,648 | ) | (14,289 | ) | |||||||||
Loan and lease losses | (33,840 | ) | (37,410 | ) | (31,500 | ) | (25,420 | ) | (40,465 | ) | |||||||||
Payments | (82,607 | ) | (33,038 | ) | (67,503 | ) | (58,594 | ) | (51,512 | ) | |||||||||
Sales and held-for-sale transfers | (8,456 | ) | (61,959 | ) | (1,131 | ) | (6,957 | ) | (8,498 | ) | |||||||||
Nonperforming assets, end of period | $ | 458,107 | $ | 480,901 | $ | 475,570 | $ | 489,824 | $ | 524,866 | |||||||||
(1) | Other nonperforming assets includes certain impaired investment securities. |
(2) | Represents loans from FirstMerit acquisition. |
(3) | Nonperforming assets divided by the sum of loans and leases, net other real estate owned, and other NPAs. |
(4) | The sum of nonperforming assets and total accruing loans and leases past due 90 days or more divided by the sum of loans and leases and other real estate. |
13
Huntington Bancshares Incorporated
Quarterly Accruing Past Due Loans and Leases and Accruing and Nonaccruing Troubled Debt Restructured Loans
(Unaudited)
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in thousands) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Accruing loans and leases past due 90 days or more: | |||||||||||||||||||
Commercial and industrial | $ | 15,054 | $ | 18,148 | $ | 20,188 | $ | 5,616 | $ | 8,032 | |||||||||
Commercial real estate | 14,499 | 17,215 | 21,260 | 10,799 | 12,694 | ||||||||||||||
Automobile | 8,123 | 10,182 | 7,871 | 5,452 | 5,064 | ||||||||||||||
Residential mortgage (excluding loans guaranteed by the U.S. Government) | 16,192 | 15,074 | 15,664 | 11,383 | 11,740 | ||||||||||||||
RV and marine finance | 2,200 | 1,462 | 1,043 | — | — | ||||||||||||||
Home equity | 15,453 | 11,508 | 12,997 | 7,579 | 8,571 | ||||||||||||||
Other consumer | 3,370 | 3,895 | 2,988 | 1,645 | 1,868 | ||||||||||||||
Total, excl. loans guaranteed by the U.S. Government | 74,891 | 77,484 | 82,011 | 42,474 | 47,969 | ||||||||||||||
Add: loans guaranteed by U.S. Government | 53,052 | 51,878 | 52,665 | 56,105 | 57,843 | ||||||||||||||
Total accruing loans and leases past due 90 days or more, including loans guaranteed by the U.S. Government | $ | 127,943 | $ | 129,362 | $ | 134,676 | $ | 98,579 | $ | 105,812 | |||||||||
Ratios: | |||||||||||||||||||
Excluding loans guaranteed by the U.S. Government, as a percent of total loans and leases | 0.11 | % | 0.12 | % | 0.12 | % | 0.08 | % | 0.09 | % | |||||||||
Guaranteed by U.S. Government, as a percent of total loans and leases | 0.08 | 0.08 | 0.08 | 0.11 | 0.11 | ||||||||||||||
Including loans guaranteed by the U.S. Government, as a percent of total loans and leases | 0.19 | 0.19 | 0.20 | 0.19 | 0.21 | ||||||||||||||
Accruing troubled debt restructured loans: | |||||||||||||||||||
Commercial and industrial | $ | 222,303 | $ | 210,119 | $ | 232,740 | $ | 232,112 | $ | 205,989 | |||||||||
Commercial real estate | 81,202 | 76,844 | 80,553 | 85,015 | 108,861 | ||||||||||||||
Automobile | 27,968 | 26,382 | 27,843 | 25,892 | 25,856 | ||||||||||||||
Home equity | 271,258 | 269,709 | 275,601 | 203,047 | 204,244 | ||||||||||||||
Residential mortgage | 239,175 | 242,901 | 251,529 | 256,859 | 259,750 | ||||||||||||||
RV and marine finance | 581 | — | — | — | — | ||||||||||||||
Other consumer | 4,128 | 3,780 | 4,102 | 4,522 | 4,768 | ||||||||||||||
Total accruing troubled debt restructured loans | $ | 846,615 | $ | 829,735 | $ | 872,368 | $ | 807,447 | $ | 809,468 | |||||||||
Nonaccruing troubled debt restructured loans: | |||||||||||||||||||
Commercial and industrial | $ | 88,759 | $ | 107,087 | $ | 70,179 | $ | 77,592 | $ | 83,600 | |||||||||
Commercial real estate | 4,357 | 4,507 | 5,672 | 6,833 | 14,607 | ||||||||||||||
Automobile | 4,763 | 4,579 | 4,437 | 4,907 | 7,407 | ||||||||||||||
Home equity | 29,090 | 28,128 | 28,009 | 21,145 | 23,211 | ||||||||||||||
Residential mortgage | 59,773 | 59,157 | 62,027 | 63,638 | 68,918 | ||||||||||||||
RV and marine finance | 106 | — | — | — | — | ||||||||||||||
Other consumer | 117 | 118 | 142 | 142 | 191 | ||||||||||||||
Total nonaccruing troubled debt restructured loans | $ | 186,965 | $ | 203,576 | $ | 170,466 | $ | 174,257 | $ | 197,934 | |||||||||
14
Huntington Bancshares Incorporated
Quarterly Capital Under Current Regulatory Standards (Basel III) and Other Capital Data
(Unaudited)
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in millions, except per share amounts) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Common equity tier 1 risk-based capital ratio:(1) | |||||||||||||||||||
Total shareholders’ equity | $ | 10,437 | $ | 10,308 | $ | 10,387 | $ | 7,507 | $ | 7,158 | |||||||||
Regulatory capital adjustments: | |||||||||||||||||||
Shareholders’ preferred equity | (1,076 | ) | (1,076 | ) | (1,076 | ) | (971 | ) | (773 | ) | |||||||||
Accumulated other comprehensive income offset | 391 | 401 | 172 | 134 | 167 | ||||||||||||||
Goodwill and other intangibles, net of related taxes | (2,174 | ) | (2,126 | ) | (2,140 | ) | (700 | ) | (703 | ) | |||||||||
Deferred tax assets that arise from tax loss and credit carryforwards | (28 | ) | (21 | ) | (29 | ) | (21 | ) | (29 | ) | |||||||||
Common equity tier 1 capital | 7,550 | 7,486 | 7,314 | 5,949 | 5,820 | ||||||||||||||
Additional tier 1 capital | |||||||||||||||||||
Shareholders’ preferred equity | 1,076 | 1,076 | 1,076 | 971 | 773 | ||||||||||||||
Other | (7 | ) | (15 | ) | (19 | ) | (14 | ) | (19 | ) | |||||||||
Tier 1 capital | 8,619 | 8,547 | 8,371 | 6,906 | 6,574 | ||||||||||||||
Long-term debt and other tier 2 qualifying instruments | 888 | 932 | 1,036 | 590 | 611 | ||||||||||||||
Qualifying allowance for loan and lease losses | 764 | 736 | 705 | 697 | 689 | ||||||||||||||
Tier 2 capital | 1,652 | 1,668 | 1,741 | 1,287 | 1,300 | ||||||||||||||
Total risk-based capital | $ | 10,272 | $ | 10,215 | $ | 10,112 | $ | 8,193 | $ | 7,874 | |||||||||
Risk-weighted assets (RWA)(1) | $ | 78,082 | $ | 78,263 | $ | 80,513 | $ | 60,721 | $ | 59,798 | |||||||||
Common equity tier 1 risk-based capital ratio(1) | 9.67 | % | 9.56 | % | 9.09 | % | 9.80 | % | 9.73 | % | |||||||||
Other regulatory capital data: | |||||||||||||||||||
Tier 1 leverage ratio(1) | 8.78 | 8.70 | 9.89 | 9.55 | 9.29 | ||||||||||||||
Tier 1 risk-based capital ratio(1) | 11.04 | 10.92 | 10.40 | 11.37 | 10.99 | ||||||||||||||
Total risk-based capital ratio(1) | 13.15 | 13.05 | 12.56 | 13.49 | 13.17 | ||||||||||||||
Non-regulatory capital data: | |||||||||||||||||||
Tangible common equity / RWA ratio(1) | 9.12 | 8.92 | 8.74 | 9.60 | 9.49 | ||||||||||||||
(1) | March 31, 2017, figures are estimated. |
15
Huntington Bancshares Incorporated
Quarterly Common Stock Summary, Non-Regulatory Capital, and Other Data
(Unaudited)
Quarterly common stock summary
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
2017 | 2016 | 2016 | 2016 | 2016 | |||||||||||||||
Common stock price, per share | |||||||||||||||||||
High(1) | $ | 14.740 | $ | 13.640 | $ | 10.110 | $ | 10.650 | $ | 10.810 | |||||||||
Low(1) | 12.370 | 9.570 | 8.230 | 8.045 | 7.830 | ||||||||||||||
Close | 13.390 | 13.220 | 9.860 | 8.940 | 9.540 | ||||||||||||||
Average closing price | 13.663 | 11.627 | 9.522 | 9.831 | 9.222 | ||||||||||||||
Dividends, per share | |||||||||||||||||||
Cash dividends declared per common share | $ | 0.08 | $ | 0.08 | $ | 0.07 | $ | 0.07 | $ | 0.07 | |||||||||
Common shares outstanding | |||||||||||||||||||
Average - basic | 1,086,374 | 1,085,253 | 938,578 | 798,167 | 795,755 | ||||||||||||||
Average - diluted | 1,108,617 | 1,104,358 | 952,081 | 810,371 | 808,349 | ||||||||||||||
Ending | 1,087,120 | 1,085,689 | 1,084,783 | 799,154 | 796,689 | ||||||||||||||
Tangible book value per common share(2) | $ | 6.55 | $ | 6.43 | $ | 6.48 | $ | 7.29 | $ | 7.12 | |||||||||
Non-regulatory capital
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||
(dollar amounts in millions) | 2017 | 2016 | 2016 | 2016 | 2016 | ||||||||||||||
Calculation of tangible equity / asset ratio: | |||||||||||||||||||
Total shareholders’ equity | $ | 10,437 | $ | 10,308 | $ | 10,387 | $ | 7,507 | $ | 7,158 | |||||||||
Less: goodwill | (1,993 | ) | (1,993 | ) | (2,004 | ) | (677 | ) | (677 | ) | |||||||||
Less: other intangible assets | (388 | ) | (402 | ) | (429 | ) | (48 | ) | (51 | ) | |||||||||
Add: related deferred tax liability(2) | 136 | 141 | 150 | 17 | 18 | ||||||||||||||
Total tangible equity | 8,192 | 8,054 | 8,104 | 6,799 | 6,448 | ||||||||||||||
Less: preferred equity | (1,071 | ) | (1,071 | ) | (1,071 | ) | (971 | ) | (773 | ) | |||||||||
Total tangible common equity | $ | 7,121 | $ | 6,983 | $ | 7,033 | $ | 5,828 | $ | 5,675 | |||||||||
Total assets | $ | 100,046 | $ | 99,714 | $ | 100,765 | $ | 73,954 | $ | 72,645 | |||||||||
Less: goodwill | (1,993 | ) | (1,993 | ) | (2,004 | ) | (677 | ) | (677 | ) | |||||||||
Less: other intangible assets | (388 | ) | (402 | ) | (429 | ) | (48 | ) | (51 | ) | |||||||||
Add: related deferred tax liability(2) | 136 | 141 | 150 | 17 | 18 | ||||||||||||||
Total tangible assets | $ | 97,801 | $ | 97,460 | $ | 98,482 | $ | 73,246 | $ | 71,935 | |||||||||
Tangible equity / tangible asset ratio | 8.38 | % | 8.26 | % | 8.23 | % | 9.28 | % | 8.96 | % | |||||||||
Tangible common equity / tangible asset ratio | 7.28 | 7.16 | 7.14 | 7.96 | 7.89 | ||||||||||||||
Other data: | |||||||||||||||||||
Number of employees (Average full-time equivalent) | 16,331 | 15,993 | 14,511 | 12,363 | 12,386 | ||||||||||||||
Number of domestic full-service branches(3) | 996 | 1,115 | 1,129 | 772 | 771 | ||||||||||||||
(1) | High and low stock prices are intra-day quotes obtained from Bloomberg. |
(2) | Other intangible assets are net of deferred tax liability, and calculated assuming a 35% tax rate. |
(3) | Includes Regional Banking and The Huntington Private Client Group offices. |
16