Huntington Bancshares Incorporated · NASDAQ:HBAN
Huntington Bancshares — Q2 2011 Earnings Presentation
150 slides from Huntington Bancshares's earnings presentation, Aug 11, 2011
Slide 1: 2011 Third Quarter Investor Handout
2011 Third Quarter Investor Handout August 11, 2011 1
Slide 2: Table of Contents
Table of Contents Current Topics 3 Quarterly Financial Review 22 Significant items impacting comparisons 28 Income Statement 29 Revenue & PTPP Growth 30 Net interest margin 32 Noninterest income 35 Noninterest expense 38 Balance Sheet 40 Investment Securities 44 Loan Portfolio Overview 50 Credit exp
Slide 3: Current Topics
Current Topics 3
Slide 4: Current Topics
Current Topics Strategic Plan Review OCR / "Fair Play" Progress Report Automobile Lending Review 4
Slide 5: Our Break Away Strategic Plan
Optimize Current Franchise Profitability / pricing Cross-sell / share-of- wallet Launch new brand Invest in capabilities and begin hiring Our "Break Away" Strategic Plan Lay the Foundation Capital and liquidity Organiza- tional changes Build management depth Credit and Risk management Invest in the
Slide 6: The Strategic Plan: Positioned for Profitability and Growth
The Strategic Plan: Positioned for Profitability and Growth Retail and Business Banking Commercial Banking Auto Finance Wealth Advisors, Gov't Finance, and Home Lending Investing for the Long Term 2010 2011 2009 Credit and Risk Management Strategic Plan 24-Hour Grace (r) Added 150 Sm Bus. Bankers Gi
Slide 7: OCR Drives Higher Customer Profitability
OCR Drives Higher Customer Profitability Clearly outlined activities by segment Defined accountability for relationships, by segment Aligned goals and incentives at all levels and in all business segments One relationship management system - MAX Weekly executive results tracking, accountability, and
Slide 8: Fair Play Leverages a Distinct Moment in Time
" Fair Play" Leverages a Distinct Moment in Time Market share is up for grabs Consumer sentiment towards banks is negative Moebs Services forecasts large banks will lose 22% of their 45% market share by year end. Regulation is mandating fee income reductions Banks are reacting by penalizing customer
Slide 9: Fair Play: Builds Trust, Deepens Relationships, Drives Growth
"Fair Play": Builds Trust, Deepens Relationships, Drives Growth A foundation of service Accelerate new customer acquisition and increase existing customer satisfaction / retention Sell more and increase share of wallet Drive growth through products that are straight forward and add differentiated cu
Slide 10: Foundation of Service
1. Foundation of Service Huntington started with the highest level of customer advocacy and has continued to separate itself from peers. MSR Group Branch Survey. Advocacy = customers who will repeat and recommend Peers: CMA, FITB, FMER,JPM, KEY, NCC/PNC, RBS/Charter One, USB Advocacy Score Trends (1
Slide 11: Accelerate New Customer Acquisition
(CHART) 2. Accelerate New Customer Acquisition Consumer Checking Households 6.8% 9.9% (1) (1) Annualized A household starts with a checking account Consumer accounts across all segments: Retail, WGH, and Auto 3% in 2009 1,042 993 980 962 945 930 5.5% 7.5%(1) (000s) 11
Slide 12: Sell More and Increase Share of Wallet
(CHART) 3. Sell More and Increase Share of Wallet Consumer Checking Account Household Product Penetration Product Penetration - 4+ Services / HH 25 potential products or services counted: checking, savings, online bill pay, mortgage, brokerage account, insurance, etc. (CHART) (CHART) Product Penetra
Slide 13: OCR / Fair Play Progress Report: Household Revenue
(CHART) OCR / "Fair Play" Progress Report: Consumer Checking Household Revenue + 6.1% ($MM) 2Q11 exceeds pre-"Fair Play" and Reg E level 13
Slide 14: Launched Two New Consumer Checking Products
Making free checking better 4. Launched Two New Consumer Checking Products Asterisk-Free CheckingTM No hooks and adding benefits Most Appealing Features: Free - No Monthly Maintenance Fee Free debit card usage Free ID Theft Resolution Service Free linked Savings Accounts No ODP transfer fee from Sav
Slide 15: Asterisk-Free Checking: A Differentiated Entry Product
Why 80% Rated Asterisk-Free #1? - $0 Monthly Checking Fee - No Monthly Checking Fee Requirements (e.g. min balance, # of debit transactions, etc.) - 24-Hour Grace(r) (CHART) Asterisk-Free Checking(tm): A Differentiated Entry Product Asterisk-Free Checking(tm) significantly outperforms peer's product
Slide 16: Huntington Plus Checking: Best In Class Premium Product
(CHART) Why 53% Rated Huntington Plus #1? - Free Unlimited Checks - Interest Bearing - Free ID Theft Resolution Service - 24-Hour Grace(r) Huntington Plus Checking(tm): Best In Class Premium Product Huntington Plus Checking(tm) significantly outperforms peer's products in consumer preference In a re
Slide 17: Fair Play Next Steps: Continue to Drive Household Growth
"Fair Play" Next Steps: Continue to Consumer Drive Household Growth US Census Bureau FDIC Launching Two New Consumer Checking Products Asterisk-Free Checking(tm) and Huntington Plus Checking(tm) significantly outperforms peer's products in consumer preference Opportunities to gain new customers 1.0
Slide 18: Rates on Automobile Originations
(CHART) Rates on Automobile Originations (1) Industry Super Prime Rates (2) (CHART) Rate paid by the customer (2) Source: Experian Automotive, Super Prime = FICO >740 (3) Average FICO 760 -0.74% -0.95% New Huntington's comparable rates are higher than industry averages... and have declined significa
Slide 19: Automobile Vintages: Outstandings and Customer Rate
(CHART) Automobile Vintages: Outstandings (1) and Customer Rate (2) ($MM) Period end Rate paid by the customer $6.2 B in loans at a 5.91% average customer rate Decline in the average rate is slowing , mirroring the two year swap curve 19
Slide 20: Market Share of New Originations
(CHART) Market Share of New Originations (1) Source: Experian Automotive, 1Q11 New & Used Financing Banks, not Captives, are the dominant players in auto financing Captives are less than 10% of used car market 20
Slide 21: Important Messages
Important Messages Executing the 2009 strategic plan This is a new Huntington Stronger management and increased accountability Improved credit, risk and financial discipline Improving performance Our strategic initiatives continue to gain traction OCR / "Fair Play" banking is working Auto lending is
Slide 22: Quarterly Financial Review
Quarterly Financial Review 22
Slide 23: Second Quarter Highlights: Earnings
$145.9 MM reported net income, or $0.16 EPS Raised quarterly common stock cash dividend to $0.04 per share 1.11% return on average assets, up from 0.96% 13.3% return on average tangible common equity, up from 12.7% $242.6 MM pre-tax, pre-provision income (1), up $1.6 MM, <1% $17.7 MM, or 3%, increas
Slide 24: Credit Quality, Customer Success and Capital Highlights
Continued improvement in credit quality trends and strong reserves 41% decrease in NCOs to an annualized rate of 1.01% 3% decline in total NALs 2.84% allowance for credit losses to total loans and leases, down from 3.07% 181% ACL coverage of NALs, down from 185% Continued "Fair Play" / OCR (1) consu
Slide 25: Other Highlights
Continued roll out of Fair Play Banking with two new checking products Asterisk- free CheckingTM Huntington Plus CheckingTM Mobile Banking for Android and iPhone launched Opened 19 new in-store Giant Eagle Branches and will have over 30 by year end Expansion of Saturday Banking Hours New Saturday br
Slide 26: Quarterly Performance Highlights
Quarterly Performance Highlights 2Q11 1Q11 4Q10 3Q10 2Q10 EPS $0.16 $0.14 $0.05 $0.10 $0.03 Pre-tax pre-provision income ($MM) (1) $242.6 $240.9 $260.1 $265.2 $270.5 Net interest margin 3.40% 3.42% 3.37% 3.45% 3.46% Efficiency ratio (2) 62.7% 64.7% 61.4% 60.6% 59.4% Return on average assets 1.11% 0.
Slide 27: Quarterly Earnings
Quarterly Earnings ‘Ohange vs. (sum) 7011 2010 4014 2010 Ant. Pet. Ant. Pet 543s S$ sr |S (1) O% a7 1% 494 193.4 (136) (28) (1878) (81) 2369 2696 188 8 (139) 6) 430.7 4138 23) (1) 146 4% 1612 et 37 284 Sia S$ we [Ss 5 15 72 199 PS $ $014 $s 003 |$ 002 14 %| 043 433% 27
Slide 28: Significant Items Impacting Financial Performance Comparisons
Significant Items Impacting Financial Performance Comparisons - Reconciliation 2011 - 2010 Quarterly 28
Slide 29: Income Statement
Income Statement 29
Slide 30: Revenue and PTPP Growth
(CHART) Revenue and PTPP Growth (1) ($MM) (CHART) (1) Revenue is FTE; See Basis of Presentation for definition of PTPP, as well as PTPP Income reconciliation slide (2) Annualized PTPP Earnings Power (2) Revenue and PTPP Trends 30
Slide 31: Pre-Tax, Pre-Provision Income
Pre-Tax, Pre-Provision Income (1) 31
Slide 32: Net Interest Income and Margin
(CHART) (CHART) Change 2Q11 vs. 1Q11: Deposits, Rate & Mix 8 bps Loans, Yield & Mix (7) Swaps (5) Other 2 Total Change (2) bps Net Interest Income and Margin (1) ($MM) (1) Fully-taxable equivalent basis Net Interest Margin (FTE) Net Interest Income (FTE) 32
Slide 33: Net Interest Margin - Yields and Rates
Net Interest Margin - Yields and Rates (CHART) (CHART) Earning Assets Total Deposits Fed Funds Net Interest Margin Loans Investment Securities Earning Asset Yields NIM - Yields & Rates 33
Slide 34: Net Interest Income at Risk
Net Interest Income at Risk (1) Forward Curve +2%, +1%, & -1% Gradual Change in Rates (CHART) Managing Interest Rate Risk Estimated impact on annualized net interest income over the next 12-month period assuming a gradual change in rates over the next 12-month period above and beyond any rate change
Slide 35: Noninterest Income Trends Linked Quarter
Noninterest Income Trends Linked Quarter 35
Slide 36: Noninterest Income Trends Prior-Year Quarter
Noninterest Income Trends Prior-Year Quarter 36
Slide 37: Mortgage Banking Income
Mortgage Banking Income ($MM) 2Q11 1Q11 4Q10 3Q10 2Q10 Origination and secondary marketing $11.5 $19.8 $48.2 $35.8 $19.8 Servicing fees 12.4 12.5 11.5 12.1 12.2 Amortization of capitalized servicing (9.1) (9.9) (14.0) (13.0) (10.1) Other mortgage banking income 4.3 3.8 4.8 5.0 3.7 Sub-total 19.1 26.
Slide 38: Noninterest Expense Trends Linked Quarter
Noninterest Expense Trends Linked Quarter 38
Slide 39: Noninterest Expense Trends Prior-Year Quarter
Noninterest Expense Trends Prior-Year Quarter 39
Slide 40: Balance Sheet
Balance Sheet 40
Slide 41: Balance Sheet — Assets
Balance Sheet — Assets zon 2010 une “118.10 Ginmitions) [June 30, MEET eT aC ‘Assets ‘Cash and due frombanks, S$ 1209 $1128 $ (142) 12.6% Interest bearing deposts in banks ‘30 289 (172) 59.6% ‘Trading account securities 164 107 @) 74% ‘Loans held for sale 164 78 (853) 71.1% Avaiable-for-sale securti
Slide 42: Balance Sheet - Liabilities and Shareholders' Equity
Balance Sheet - Liabilities and Shareholders' Equity 42
Slide 43: Earning Assets and Funding Composition
Earning Assets and Funding Composition (1) (CHART) (1) Average balances (2) Interest bearing liabilities + DDA noninterest bearing (CHART) Funding (2) Earning Asset Composition 43
Slide 44: Investment Securities
Investment Securities 44
Slide 45: AFS and Other Securities
(CHART) (CHART) AFS and Other Securities ($MM) % of Average Earning Assets Average Balance & Yield 45
Slide 46: Securities Trends
Securities Trends (1) Linked Quarter - Average Treasury/Agency debt with weighted average life of approximately 2.5 years Agency CMO / MBS with weighted average life of approximately 3.9 years 46
Slide 47: Securities Overview - 6/30/11
Securities Overview (1) - 6/30/11 47
Slide 48: Selected Securities - Assessment
Selected Securities - Assessment (1) Par Value Book Value Market Value MTM Alt-A mortgage backed $65 MM $62 MM $55 MM $(7) MM - Purchased 2006 % to Par Value 85% - 3 securities - senior tranche - 10/1 ARMs or 30 year fixed; no option ARMs - Cash flow analysis performed monthly to test for OTTI with
Slide 49: Securities Mix Analysis
(CHART) Securities Mix Analysis 12/31/10 $9.8 B (1) 3.0 Years 12/31/08 $4.4 B 5.2 Years 12/31/09 $8.6B 2.4 Years Excludes variable rate demand notes: $139 million at 12/31/10 and $113 million at 6/30/11 $670 MM of Agency CMO / MBS classified as HTM included at amortized cost (1) 6/30/11 $8.7 B (1) (
Slide 50: Loan Portfolio Overview
Loan Portfolio Overview 50
Slide 51: Credit Exposure Composition
($B) 6/30/11 6/30/11 6/30/11 12/31/10 12/31/10 12/31/10 12/31/09 12/31/09 12/31/09 12/31/08 12/31/08 12/31/08 12/31/07 12/31/07 12/31/07 Amt Pct Amt Pct Amt Pct Amt Pct Amt Pct Commercial & industrial $13.5 35 % $13.1 34 % $12.9 35 % $13.5 33 % $13.1 33 % Commercial real estate 6.2 16 6.7 18 7.7 21
Slide 52: Total Loans and Leases Portfolio Overview
(CHART) Total Loans and Leases Portfolio Overview ($B) $20.2 $6.4 $3.0 $1.5 $2.7 $1.5 $0.8 $2.9 EOP Outstandings - $39.1 Billion (1) (1) 6/30/11 By State 52
Slide 53: Loan and Lease Trends Linked Quarter
Loan and Lease Trends Linked Quarter 53
Slide 54: Loan and Lease Trends Prior-Year Quarter
Loan and Lease Trends Prior-Year Quarter 54
Slide 55: Gross Loan Growth
Gross Loan Growth (CHART) (CHART) Source: SNL; company reports MTB's growth includes acquisition of Wilmington Trust's Loan Portfolio Prior Year Quarter 2Q10-2Q11 Linked Quarter 1Q11-2Q11 55
Slide 56: Total Commercial Loans
Total Commercial Loans 56
Slide 57: Total Commercial Loans - Granularity
(CHART) Total Commercial Loans - Granularity EOP Outstandings - $19.7 Billion (1) (CHART) 769 2% 35,100 98% (1) 6/30/11 Loans by Dollar Size # of Loans by Size $5 MM - < $10 MM 405 $10 MM - < $25 MM 306 $25 MM - < $50 MM 50 > $50 MM 8 Total 769 57
Slide 58: Commercial Loans - Risk Grade Distribution
(CHART) Commercial Loans - Risk Grade Distribution PD Risk Grades (Moody's or Regulatory Definition) Percent of End of Period Balances ($B) $23.6 $20.6 10% 16% 4% 8% 15% 18% 16% 20% 17% 22% 13% 14% 10% 12% 2% 3% 13% 6% 19% 15% 18% 15% 13% 2% $19.7 15% 8% 4% 18% 16% 19% 18% 14% 3% $19.7 58
Slide 59: Commercial and Industrial Loans (C&I)
Commercial and Industrial Loans (C&I) 59
Slide 60: C&I - Overview
C&I - Overview EOP Outstandings - $13.5 Billion (1) Diversified by sector and geographically within our Midwest footprint Granular 7 loans >$50 million... 4% of portfolio 65 loans $20-$50 million... 13% of the portfolio Focus on middle market companies with $15-$500 million in sales Credit Quality T
Slide 61: C&I - Credit Risk Management Strategies
C&I - Credit Risk Management Strategies What We Do Lend to defined relationship oriented clients Follow disciplined credit policies and processes Understand our client's market / industry and their durable competitive advantage Underwrite to historical cash flows with collateral as a secondary repay
Slide 62: C&I Loan Portfolio Composition
(CHART) C&I Loan Portfolio Composition ($B) EOP Outstandings - $13.5 Billion (1) (1) 6/30/11 By Maturity $1.8 $5.5 $1.9 $1.6 $1.5 $1.0 $0.3 62
Slide 63: C&I - Trends
(CHART) C&I - Trends ($MM) Change Analysis Period-End Balance ($MM) 2Q11 vs. 1Q11 2Q11 vs. 2Q10 Originations $809 $3,240 Net payments / payoffs / takedowns (546) (1,739) Net reclassifications 12 (134) Charge-offs (30) (216) Net change $245 $1,152 1.8% 9.3% 63
Slide 64: C&I - Auto Industry
C&I - Auto Industry (1) Outstandings (2) ($MM) 2Q11 1Q11 4Q10 3Q10 2Q10 Suppliers Domestic $ 127 $ 135 $ 127 $ 135 $ 136 Foreign 20 23 22 22 24 Total suppliers 146 157 149 157 160 Dealers Floorplan-domestic 651 620 599 470 411 Floorplan-foreign 329 463 457 302 292 Total floorplan 980 1083 1056 772 7
Slide 65: Commercial Real Estate Loans (CRE)
Commercial Real Estate Loans (CRE) 65
Slide 66: CRE - Overview
CRE - Overview EOP Outstandings - $6.2 Billion (1) Granular portfolio with geographic and project diversification throughout our footprint Construction lending targeted to major metro markets CRE - Construction ($0.6 Billion) 47% reduction in balances since 6/30/10 72% of current balances to "Core"
Slide 67: CRE - Portfolio Composition
(CHART) CRE - Portfolio Composition Permanent 28% Mini-perm Traditional 39% Construction 9% Non Project Loans 7% (CHART) Lines / Letters of Credit 2% (1) 6/30/11 Permanent Qualified 9% Mini-perm Traditional - Typically 2- to 5-year term loans to allow properties to reach stabilized operating levels
Slide 68: CRE - Trends
(CHART) CRE - Trends ($MM) Change Analysis Period-End Balance ($MM) 2Q11 vs. 1Q11 2Q11 vs. 2Q10 Originations $ 87 $ 342 Takedowns 180 617 Net payments / payoffs / other (365) (1,736) Charge-offs (37) (243) Net change $(134) $(1,020) (2.1)% (14.2)% 68
Slide 69: CRE - Change Analysis
CRE - Change Analysis 1Q11 Construction Commercial Total CRE December 31, 2010 $650 $6,001 $6,651 New originations 0 93 93 Net pay-offs / takedowns / other (33) (337) (370) Charge-offs (30) (46) (76) March 31, 2011 $587 $5,711 $6,298 Net change $(63) $(290) $(353) 2Q11 Construction Commercial Total
Slide 70: CRE - Core Characteristics
CRE - Core Characteristics EOP Outstandings - $4.0 Billion (1) Long-term meaningful relationships... many have been customers for 20+ years with opportunities for additional cross-sell Well-seasoned regional or institutional owners, developers, and organizations Primarily Midwest footprint projects
Slide 71: CRE - Noncore Characteristics
CRE - Noncore Characteristics EOP Outstandings - $2.2 Billion (1) Limited opportunity to gain overall banking relationship Includes numerous performing, pass-rated loans not meeting desired return on capital Includes 66% "criticized" loans from the overall CRE portfolio 26% aggressive credit mark Up
Slide 72: CRE - Noncore Characteristics: SAD and Other
Special Assets Department (SAD) ($1.0 Billion) 43% aggressive credit mark Actively working to exit... more aggressive terms - e.g., higher pricing, shorter amortization, sale, etc. 73% of "criticized" loans are managed within SAD Other ($1.2 Billion) 9% credit mark represents... 3.6x coverage of NAL
Slide 73: CRE - Core vs. Noncore
CRE - Core vs. Noncore ($MM) O/S ACL Criticized NALs Prior Charge-offs(1) ACL Credit Mark (2) 3/31/11 Core Total $3,912 $140 $354 $31 $ 12 3.58% 3.88% Noncore SAD 1,249 285 819 239 353 22.78 39.79 Noncore Other 1,138 95 305 36 14 8.35 9.50 Noncore Total 2,387 380 1,124 275 367 15.90 27.12 CRE Total
Slide 74: CRE - Core vs. Noncore Change Analysis
CRE - Core vs. Noncore Change Analysis 1Q11 Core Noncore Total CRE December 31, 2010 $4,042 $2,609 $6,651 Originations 92 1 93 Net payments / takedowns / other (213) (157) (370) Charge-offs (9) (67) (76) March 31, 2011 $3,912 $2,387 $6,298 Net change $(130) $(222) $(353) 2Q11 Core Noncore Total CRE
Slide 75: CRE - Maturity Schedule By Loan Type
CRE - Maturity Schedule By Loan Type - 6/30/11 ($MM) Within 12 Mos. 1 - 2 Years 2 - 5 Years 5+ Years Total Construction $ 318 $ 160 $ 86 $ 9 $ 572 Lines / letters of credit 53 20 13 11 96 Non project loans 215 90 103 46 454 Mini-perm traditional 1,419 700 550 4 2,672 Permanent qualified 188 119 254
Slide 76: Total Consumer Loans and Leases
Total Consumer Loans and Leases 76
Slide 77: Consumer Loans and Leases - 6/30/11
Consumer Loans and Leases - 6/30/11 ($B) Amt. Pct. Automobile $ 6.2 32% Home equity 8.0 41 Residential RE 4.8 24 Other consumer 0.5 3 Total consumer $19.4 100% (CHART) By Loan Type 77
Slide 78: Consumer Loan Credit Risk Management
Consumer Loan Credit Risk Management Objective Manage the Probability of Default Footprint Portfolio... markets we know and understand Client Selection... bias for high quality customers and relationship lending vs. third-party originations Disciplined Underwriting... borrower ability to repay, coll
Slide 79: Automobile - Overview
Automobile - Overview EOP Outstandings - $6.2 Billion (1) Consistency of strategy and commitment to dealers Focus on high service quality and full dealer relationships Since 2001 focused on super-prime customers >750 FICOs Fully automated origination and booking system Credit Quality Trends Credit q
Slide 80: Auto Lending - Credit Risk Management Strategies
Auto Lending - Credit Risk Management Strategies Performance Drivers Borrower quality - as measured at origination by: FICO score - Super Prime with consistent increasing trend FICO score distribution - consistent decline in <670 levels Custom Score - utilized to further segment FICO eligible applic
Slide 81: Auto Loans - Production and Credit Quality Overview
Auto Loans - Production and Credit Quality Overview Auto Loans - Production and Credit Quality Overview (1) Annualized 81
Slide 82: Home Equity - Overview
Home Equity - Overview EOP Outstandings - $8.0 Billion (1) Focused on geographies within our Midwest footprint Focused on high quality borrowers... >730 FICOs Began exit of broker channel in 2005... <7% of outstandings today Conservative underwriting - manage the probability of default High risk bor
Slide 83: Home Equity - Credit Risk Management Strategies
Home Equity - Credit Risk Management Strategies Performance Drivers Borrower quality - as measured at origination by Custom Score - utilized to further segment FICO eligible applications - continues to enhance predictive modeling FICO score - consistent increasing trend, with very limited under 670
Slide 84: Residential Mortgages - Overview
EOP Outstandings - $4.8 Billion (1) Focused on geographies within our Midwest footprint Traditional product mix... very limited nontraditional exposure as we never originated sub-prime, payment option ARMs, or negative amortization loans $508 MM of Interest Only loans... targeted within executive re
Slide 85: Residential Mortgages - Credit Risk Management Strategies
Residential Mortgages - Credit Risk Management Strategies Performance Drivers Standard products and borrower quality - as measured at origination by: Secondary market underwriting FICO score - consistent increasing trend FICO score distribution - consistent decline in low score levels Non-standard p
Slide 86: Residential Mortgages - Credit Risk Management Strategies
Residential Mortgages - Credit Risk Management Strategies Risk Recognition Write down to discounted current value less selling costs at 150 days past due Nonaccrual balances represent the realizable value estimate in future periods Continued Focus on Borrower's Ability to Pay for New Originations Al
Slide 87: Residential Mortgages - LTV, FICO, Originations
Residential Mortgages - LTV, FICO, Originations (1) Weighted average FICOs reflect currently updated customer credit scores (2) Only owned-portfolio originations Weighted average at origination 2Q11 1Q11 4Q10 3Q10 2Q10 Ending balance ($B) $4.8 $4.5 $4.5 $4.5 $4.4 Average LTV 78% 78% 77% 77% 77% Aver
Slide 88: Other Consumer Loans
Other Consumer loans EOP Outstandings - $0.5 Billion (1) Over collateralized Autos, untitled vehicles, small boats, mobile homes and other miscellaneous Primarily for existing customers Performed within expectations over the past year, though varies by collateral type (1) 6/30/11 88
Slide 89: Credit Quality Review
Credit Quality Review 89
Slide 90: Credit Quality Trends Overview
Credit Quality Trends Overview Credit Quality Trends Overview Excludes loans guaranteed by the U.S. Government NALs divided by total loans and leases (3) NPAs divided by the sum of loans and leases, impaired loans held for sale, net other real estate and other NPAs (4) Criticized assets = commercial
Slide 91: Total Commercial Loan - Delinquencies
Total Commercial Loan - Delinquencies (1) (CHART) (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP 90+ Days 30+ Days 91
Slide 92: Total Consumer Loan Delinquencies
(CHART) Total Consumer Loan Delinquencies (1) (CHART) 90+ Days 30+ Days (1) Period end; delinquent but accruing as a % of related outstandings at EOP 92
Slide 93: Consumer Loan Delinquencies
Consumer Loan Delinquencies (1) (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP (2) Excludes GNMA FAS 140 government guaranteed and Franklin in periods prior to 2Q10 (CHART) (2) (2) (2) (2) 90+ Days 30+ Days 93
Slide 94: Net Charge-Offs
(CHART) Net Charge-Offs ($MM) ($MM) Consumer Loans Commercial Loans (2) (CHART) (1) Includes $16.4 MM related to $39.8 MM of residential mortgages sold and a $4.4 MM Franklin-related recovery (1) 94
Slide 95: Net Charge-Offs ($MM)
Net Charge-Offs ($MM) 2Q11 1Q11 4Q10 3Q10 2Q10 Commercial and industrial $18.7 $42.2 $59.1 $62.2 $58.1 Commercial real estate 27.6 67.7 44.9 63.7 81.7 Total commercial 46.3 109.9 104.0 125.9 139.9 Automobile 2.3 4.7 7.0 5.6 5.4 Home equity 25.4 26.7 29.2 27.8 44.5 Residential mortgages (1) 16.5 18.9
Slide 96: Net Charge-Off Ratios
Net Charge-Off Ratios (1) 2Q11 1Q11 4Q10 3Q10 2Q10 Commercial and industrial 0.56% 1.29% 1.85% 2.01% 1.90% Commercial real estate 1.77 4.15 2.64 3.60 4.44 Total commercial 0.94 2.24 2.13 2.59 2.85 Automobile 0.15 0.33 0.51 0.43 0.47 Home equity 1.29 1.38 1.51 1.47 2.36 Residential mortgages (2) 1.44
Slide 97: Nonaccrual Loans and Nonperforming Assets
(CHART) Nonaccrual Loans and Nonperforming Assets ($MM) (CHART) ($MM) (62)% (21)% (32)% (18)% (28)% NAL Inflows NALs & NPAs - EOP (18)% 15% (3)% 10% (19)% 97
Slide 98: Nonaccrual Loans (NALs) and Nonperforming Assets (NPAs)
Nonaccrual Loans (NALs) and Nonperforming Assets (NPAs) 98
Slide 99: Nonperforming Asset Flow Analysis
($MM) 2Q11 1Q11 4Q10 3Q10 2Q10 NPA beginning-of-period $690.9 $844.8 $1,104.9 $1,582.7 $1,918.4 Additions / increases 210.3 192.0 237.8 278.4 171.6 Franklin - net impact (5.1) (3.5) (5.9) (251.4) (86.7) Return to accruing status (68.4) (70.9) (100.1) (111.2) (78.7) Loan and lease losses (74.9) (128.
Slide 100: Total Commercial Loans - Criticized Loan Flow Analysis
($MM) 2Q11 1Q11 4Q10 3Q10 2Q10 Criticized beginning-of-period $2,661 $3,074 $3,638 $4,106 $4,608 Additions / increases 250 170 290 408 280 Advances 44 62 52 75 79 Upgrades to "Pass" (272) (239) (383) (391) (409) Paydowns (232) (295) (401) (409) (331) Charge-offs (73) (112) (121) (152) (121) Criticiz
Slide 101: Accruing Troubled Debt Restructured Loans
Accruing Trouble Debt Restructured Loans 101
Slide 102: Provision, NCO, and ACL
(CHART) Provision, NCO, and ACL ($MM) (1) NCO % annualized End of period (CHART) Allowance for Credit Losses vs. NALs (2) Loan Loss Provision vs. Net Charge-offs (1) 102
Slide 103: Relative Performance - ALLL / NAL Coverage
(CHART) Relative Performance - ALLL / NAL Coverage Source: SNL; company reports 103
Slide 104: Relative Performance - LLR/Loans Ratios
(CHART) Relative Performance - LLR/Loans Ratios Source: SNL; company reports 104
Slide 105: Rapid Improvement in Credit Quality - Nonaccrual Loans Ratio
Rapid Improvement in Credit Quality - Nonaccrual Loans Ratio 6/30/11 Change from 6/30/10 (CHART) Source: SNL; company reports (CHART) 105
Slide 106: Rapid Improvement in Credit Quality - Reserves / Nonaccrual Loans
Rapid Improvement in Credit Quality - Loan Loss Reserves / Nonaccrual Loans (CHART) (CHART) Source: SNL; company reports 6/30/11 Change from 6/30/10 106
Slide 107: Non-Franklin Credit Metrics Reconciliations
Non-Franklin Credit Metrics Reconciliations 107
Slide 108: Non-Franklin Credit Metrics Reconciliation
Non-Franklin Credit Metrics Reconciliation 108
Slide 109: Non-Franklin Credit Metrics Reconciliation
Non-Franklin Credit Metrics Reconciliation 109
Slide 110: Non-Franklin Credit Metrics Reconciliation
Non-Franklin Credit Metrics Reconciliation 110
Slide 111: Quarterly Net Charge-Off Reconciliation
Quarterly Net Charge-Off Reconciliation (1) (1) Annualized 111
Slide 112: Quarterly Net Charge-Off Reconciliation
Quarterly Net Charge-Off Reconciliation (1) (1) Annualized 112
Slide 113: Quarterly Net Charge-Off Reconciliation
Quarterly Net Charge-Off Reconciliation (1) (1) Annualized 113
Slide 114: Nonaccrual Loans, Nonperforming Assets and Accruing Restructured Loans
Nonaccrual Loans (NALs), Nonperforming Assets (NPA) and Accruing Restructured Loans (ARLs) 114
Slide 115: Nonaccrual Loans, Nonperforming Assets and Accruing Restructured Loans
Nonaccrual Loans (NALs), Nonperforming Assets (NPA) and Accruing Restructured Loans (ARLs) 115
Slide 116: Nonaccrual Loans, Nonperforming Assets and Accruing Restructured Loans
Nonaccrual Loans (NALs), Nonperforming Assets (NPA) & Accruing Restructured Loans (ARLs) 116
Slide 117: Deposits and Other Funding
Deposits and Other Funding 117
Slide 118: Deposits
(CHART) (CHART) Deposits ($B) Avg. Total Deposits - Rate / Mix Core CD Maturities & Avg. Maturity Rate Rate 1.37% 1.21% 1.06% 0.90% 0.82% Estimates 118
Slide 119: Deposit Trends Linked Quarter
Deposit Trends Linked Quarter 119
Slide 120: Deposit Trends Prior-Year Quarter
Deposit Trends Prior-Year Quarter 120
Slide 121: Total Core Deposit Trends
Total Core Deposit Trends 121
Slide 122: Other Funding
(CHART) Other Funding End of Period Balances ($B) $11.5 14% 22% 29% 16% 8% 7% 39% 33% 17% 13% $8.8 14% 27% 2% 35% 22% $7.6 20% 3% 25% 29% 27% $9.0 20% 24% 2% 28% 27% 122
Slide 123: Capital
Capital 123
Slide 124: Capital
Capital (1) 2Q11 1Q11 4Q10 3Q10 2Q10 Total risk-weighted assets ($B) $44.1 $43.0 $43.5 $42.7 $42.5 Tier 1 leverage 10.25% 9.80% 9.41% 10.54% 10.45% Tier 1 risk-based capital 12.14 12.04 11.55 12.82 12.51 Total risk-based capital 14.89 14.85 14.46 15.08 14.79 Tang. common equity/ tang. assets 8.22 7.
Slide 125: Capital Ratios
(CHART) Capital Ratios (1) End-of-period 4Q10 - Raised $920 MM of common equity and repurchased $1.4 B of TARP related preferred shares (2) 125
Slide 126: Shareholders' Equity and Key Equity Ratios
(CHART) Shareholders' Equity - Avg. (CHART) Capital Key Equity Ratios - EOP ($B) 126 4Q10 - Raised $920 MM of common equity and repurchased $1.4 B of TARP related preferred shares
Slide 127: Capital Analysis - 6/30/11
(CHART) Capital Analysis - 6/30/11 (CHART) Source: SNL, Company reports. Tier 1 Common Risk-Based Tangible Common Equity TARP- fully repaid 127
Slide 128: Franchise and Leadership
Franchise and Leadership 128
Slide 129: Huntington Bancshares Overview
Huntington Bancshares Overview Midwest financial services holding company Founded - 1866 Headquarters - Columbus, Ohio Total assets - $53 Billion Employees (1) - 11,457 Franchise: Footprint 6 states: OH, MI, PA, IN, WV, KY 643 branches / 1,347 ATMs Retail and Business Banking 5 Areas - Mortgage bank
Slide 130: The Huntington Franchise
The Huntington Franchise Branches 119 ATMs 240 Detroit 4% Grand Rapids 10% Branches 362 ATMs 775 Akron 8% Canton 27% Cincinnati 4% Cleveland 8% Columbus 22% Dayton 6% Toledo 23% Youngstown 20% Branches 50 ATMs 70 Indianapolis 6% Branches 13 ATMs 30 Branches 30 ATMs 135 Charleston 11% Includes 11 PFG
Slide 131: A Strong Regional Presence
A Strong Regional Presence Source: SNL Financial, company presentations and filings FDIC deposit data as of June 30, 2010 Deposits - Top 12 MSAs MSA Rank BBs Deposits Share Columbus, OH 1 69 $9,124 22.2% Cleveland, OH 5 62 3,941 7.8 Detroit, MI 8 50 3,607 4.2 Toledo, OH 1 42 2,306 22.9 Pittsburgh, P
Slide 132: Leadership Team
Leadership Team Leadership Team Business Segments Insurance, 132
Slide 133: Senior Leadership Team
Senior Leadership Team (1) Includes related experience outside of banking 133
Slide 134: Business Segment Overview
Business Segment Overview 134
Slide 135: Business Segment Loans & Deposits - 2Q11
Business Segment Loans & Deposits - 2Q11 Average Total Deposits - $41.3 B Average Total Loans - $38.5 B (CHART) (CHART) AFCRE $13.1B 34% Retail & Business Banking $11.9B 31% Treasury / Other $0.1B 0% Regional & Comm'l Banking $8.1B 21% WGH $5.3B 14% AFCRE $0.8B 2% Treasury / Other $0.7B 2% Retail &
Slide 136: Total Loans and Leases - By Business Segment
Total Loans and Leases - By Business Segment Total Loans and Leases - By Business Segment Avg. Outstandings - $38.5 Billion 2Q11 136
Slide 137: Total Deposits - By Business Segment
Total Deposits - By Business Segment Total Deposits - By Business Segment Avg. Balances - $41.3 Billion 2Q11 137
Slide 138: Business Segment Contribution
Business Segment Contribution ($MM) 2Q11 2010 2009 2008 Retail & Business Banking $47.0 $131.0 $(26.5) $257.8 Regional & Comm'l Banking 27.1 38.5 (158.7) 80.3 AFCRE 50.8 46.5 (588.2) (14.2) WGH 8.1 34.8 1.8 43.0 Treas. / Other 12.9 61.6 (251.3) (480.8) Unallocated goodwill impairment (1) -- (2,573.8
Slide 139: Business Segment Overview
Business Segment Overview Commercial Banking Executive - Jim Dunlap 11 Region Presidents Middle Market Commercial Banking Specialty Banking Large Corporate Health-care Not-for-Profit Equipment Finance International Services Treasury Management Capital Markets Derivatives Foreign Exchange Securities
Slide 140: Commercial Banking Regions
11 Commercial Banking Regions Greater Akron/Canton Mahoning Valley Central Ohio NW Ohio S. Ohio/KY Greater Cleveland Central Indiana West Michigan East Michigan West Virginia Pittsburgh Jim Dunlap 140
Slide 141: Regional Banking Presidents
Regional Banking Presidents 141
Slide 142: Retail and Business Banking Areas
5 Retail and Business Banking Areas Central Northwest West Northeast East Mary Navarro 142
Slide 143: #1 in Ohio Branches Planned Rollout
#1 in Ohio Branches Planned Rollout 12% the cost of a traditional branch 27 opened 28 by end of 2011 103 by end of 2015 Cash flow breakeven in < 2 years Increase Convenience - Ohio Branch share source, SNL Financial, 6/30/2010 % of Branches % of Branches % of Branches MSA 6/10 Pro Forma (1) Pro Form
Slide 144: Retail & Business Banking Executives
Retail & Business Banking Executives 144
Slide 145: Business Segment Overview
Business Segment Overview Wealth Advisors, Government Finance, and Home Lending Executive - Dan Benhase Wealth Advisors Trust / Portfolio Management Private Banking Retail Brokerage Government Finance Public Funds - Treasury Services and Lending Corporate Trust National Settlement Home Lending Mortg
Slide 146: Safe Harbor Disclosures
Safe Harbor Disclosures 146
Slide 147: Use of non-GAAP financial measures
Use of non-GAAP financial measures This document may contain GAAP financial measures and non-GAAP financial measures where management believes it to be helpful in understanding Huntington's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP f
Slide 148: Significant Items
Significant Items From time to time, revenue, expenses, or taxes are impacted by items judged by Management to be outside of ordinary banking activities and/or by items that, while they may be associated with ordinary banking activities, are so unusually large that their outsized impact is believed
Slide 149: Fully-taxable equivalent interest income and net interest margin
Fully-taxable equivalent interest income and net interest margin Income from tax-exempt earning assets is increased by an amount equivalent to the taxes that would have been paid if this income had been taxable at statutory rates. This adjustment puts all earning assets, most notably tax-exempt muni
Slide 150: Forward-looking statements
This document contains certain forward-looking statements, including certain plans, expectations, goals, projections, and statements, which are subject to numerous assumptions, risks, and uncertainties. Forward-looking statements may be identified by words such as expect, anticipate, believe, intend
Huntington Bancshares — Q2 2011 Earnings Presentation on 6ix