Huntington Bancshares Incorporated · NASDAQ:HBAN
Huntington Bancshares — Q3 2011 Earnings Presentation
133 slides from Huntington Bancshares's earnings presentation, Nov 8, 2011
Slide 1: 2011 Fourth Quarter Investor Handout
2011 Fourth Quarter Investor Handout November 7, 2011 1
Slide 2: Table of Contents
Table of Contents Current Topics 3 OCR Performance Review 7 Quarterly Financial Review 16 Significant items impacting comparisons 22 Income Statement 23 Revenue & PTPP Growth 24 Net interest margin 26 Noninterest income 29 Noninterest expense 32 Balance Sheet 34 Investment Securities 38 Loan Portfol
Slide 3: Current Topics
Current Topics 3
Slide 4: Current Topics: Strategic Plan Review, OCR / Fair Play Progress Report
Current Topics Strategic Plan Review OCR / "Fair Play" Progress Report 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 6 Retail and Business Banking Commercial Banking Auto Finance Wealth Advisors, Gov't Finance, and Home Lending 2010 2009 Credit and Risk Management Strategic Plan 24-Hour Grace (r) Added 150 Sm Bus. Bankers Giant Eagle / In-Store Asterisk-F
Slide 7: Important Messages
Important Messages Executing our long-term strategic plan Strategic initiatives are increasingly adding to revenue OCR is working... accelerated growth in commercial relationships and revenue contribution "Fair Play" is working... accelerated growth in consumer checking households and revenue contri
Slide 8: OCR Performance Review
OCR Performance Review 8
Slide 9: 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 10: Consumer Checking Account Household Growth
(CHART) Consumer Checking Account Household Growth Consumer Checking Households 6.8% 10.8%(1) (1) YTD Annualized 10.8% YTD growth annualized 72.8% with 4+ products or services penetration 3Q11 revenue of $252 MM, up 5.0% YOY (000s) 10
Slide 11: Sell More and Increase Share of Wallet
(CHART) Sell More and Increase Share of Wallet Consumer Checking Account Household Product Penetration Product Penetration - 4+ Services / HH 25 potential products or services counted: checking, savings, online bill pay, mortgage, brokerage account, insurance, etc. (CHART) (CHART) Product Penetratio
Slide 12: Consumer Checking Household Revenue
(CHART) Consumer Checking Household Revenue + 5.0% ($MM) 3Q11 exceeds pre-"Fair Play" and Reg E level 12 Pre-Reg E (1) 3Q11 reflects lower NIM (1)
Slide 13: Commercial Relationships Growth
(CHART) Commercial Relationships 4.9% 8.6%(2) (1) Checking account (2) YTD Annualized 8.6% YTD growth annualized 29.2% with 4+ products or services penetration 3Q11 revenue of $176 MM, up 15.5% YOY (000s) 13 Commercial Relationship (1) Growth
Slide 14: Commercial Relationship Product Penetration
(CHART) Commercial Relationship (1) Product Penetration Product Penetration - 4+ Services / Relationship Deepening relationships and accelerating product cross-sell (CHART) (CHART) Product Penetration - 1 Services / Relationship Product Penetration - 2-3 Services / Relationship 14 (1) Checking accou
Slide 15: Commercial Relationship Revenue
Migration from credit dependent to relationship based / cross-sell culture Revenue mix has improved dramatically (CHART) 15 Commercial Relationship (1) Revenue ($MM) + 15.5%
Slide 16: Quarterly Financial Review
Quarterly Financial Review 16
Slide 17: 2011 Third Quarter Highlights
$143.4 MM reported net income, or $0.16 EPS 1.05% return on average assets 13.0% return on average tangible common equity $240.7 MM pre-tax, pre-provision income (1), down $1.9 MM, or 1% $5.8 MM, or 1%, increase in fully-taxable equivalent revenue $3.0 MM, or 1%, increase in fully-taxable equivalent
Slide 18: 2011 Third Quarter Highlights (continued)
Continued OCR (1) customer success Consumer checking account households 10.8% YTD growth annualized 72.8% with 4+ products or services penetration, up from 68.5% in 2Q10 Commercial relationships 8.6% YTD growth annualized 29.2% with 4+ products or services penetration, up from 23.0% in 2Q10 Continue
Slide 19: Other Highlights
$1.0 B auto loan securitization Expansion of Auto Finance into Minnesota and Wisconsin Branch Expansion 19 new Giant Eagle in-store branches... 23 opened with 28 targeted by year end 3 new branches in the Detroit area Helga Houston to succeed Kevin Blakely as Chief Risk Officer Moody's Upgrade Other
Slide 20: Quarterly Performance Highlights
Quarterly Performance Highlights 3Q11 2Q11 1Q11 4Q10 3Q10 EPS $0.16 $0.16 $0.14 $0.05 $0.10 Net interest margin 3.34% 3.40% 3.42% 3.37% 3.45% Efficiency ratio (1) 63.5% 62.7% 64.7% 61.4% 60.6% Return on average assets 1.05% 1.11% 0.96% 0.90% 0.76% Return on average tangible equity 13.0% 13.3% 12.7%
Slide 21: Quarterly Earnings
Quarterly Earnings Change vs (SMM) 2011 3010 2att 3010 Ant _ Pet Tat i Net interest income $ 403.3) $ 410.0 31 1 %/S (3.5) (1) % Provision 358 119.2 78 (756) (63) Noninterest income (255.8 267.1 28 1 (8.6) (3) Noninterest expense 428.4 427.3 10.7 2 18 3% Pre-tax income 194.9 130.6 (12.6) (6) 51.7 40
Slide 22: Significant Items Impacting Financial Performance Comparisons
Significant Items Impacting Financial Performance Comparisons - Reconciliation 2011 - 2010 Quarterly 22
Slide 23: Income Statement
Income Statement 23
Slide 24: Revenue and PTPP Growth
(CHART) Revenue and PTPP Growth (1) ($MM) (CHART) (1) Revenue is FTE; See Basis of Presentation for definition of PTPP, as well as PTPP Income reconciliation slide (2) Annualized PTPP Earnings Power (2) Revenue and PTPP Trends 24
Slide 25: Pre-Tax, Pre-Provision Income
Pre-Tax, Pre-Provision Income (1) 25
Slide 26: Net Interest Income and Margin
(CHART) (CHART) Change 3Q11 vs. 2Q11: Loans, yield & mix (9) bps Investments / liquidity (2) Securitization (1) Deposits, rate & mix 6 Total change (6) bps Net Interest Income and Margin (1) ($MM) (1) Fully-taxable equivalent basis Net Interest Margin (FTE) Net Interest Income (FTE) 26
Slide 27: Net Interest Margin - Yields and Rates
Net Interest Margin - Yields and Rates (CHART) (CHART) Earning Assets Total Deposits Fed Funds Net Interest Margin Loans Available for Sale and Other Securities Earning Asset Yields NIM - Yields & Rates 27
Slide 28: 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 29: Noninterest Income Trends Linked Quarter
Noninterest Income Trends Linked Quarter 29
Slide 30: Noninterest Income Trends Prior-Year Quarter
Noninterest Income Trends Prior-Year Quarter 30
Slide 31: Mortgage Banking Income
Mortgage Banking Income ($MM) 3Q11 2Q11 1Q11 4Q10 3Q10 Origination and secondary marketing $15.6 $11.5 $19.8 $48.2 $35.8 Servicing fees 12.1 12.4 12.5 11.5 12.1 Amortization of capitalized servicing (9.6) (9.1) (9.9) (14.0) (13.0) Other mortgage banking income 3.8 4.3 3.8 4.8 5.0 Sub-total 22.0 19.1
Slide 32: Noninterest Expense Trends Linked Quarter
Noninterest Expense Trends Linked Quarter 32
Slide 33: Noninterest Expense Trends Prior-Year Quarter
Noninterest Expense Trends Prior-Year Quarter 33
Slide 34: Balance Sheet
Balance Sheet 34
Slide 35: Balance Sheet - Assets
Balance Sheet — Assets 2011 2010 Sep. ‘11 s."10 Gn mitions) (ETE ure 30 “Sep. 30. ‘Anunt Percent ‘Assets Cash and due frombanks S 984 $1138 $1051 92.3% Interest bearing depots in banks 7 24 (169) -61.5% Trading account securties Ea 139 (53) 282% Loans held for sale 208 m4 (410) -55.1% Avaiable-for-s
Slide 36: Balance Sheet - Liabilities and Shareholders' Equity
Balance Sheet - Liabilities and Shareholders' Equity 36
Slide 37: Earning Assets and Funding Composition
Earning Assets and Funding Composition (1) (CHART) (1) Average balances (2) Interest bearing liabilities + DDA noninterest bearing (CHART) Funding (2) Earning Asset Composition 37
Slide 38: Investment Securities
Investment Securities 38
Slide 39: Available For Sale and Other Securities
(CHART) (CHART) Available For Sale and Other Securities ($MM) % of Average Earning Assets Average Balance & Yield 39
Slide 40: Securities Trends
Securities Trends (1) Linked Quarter - Average Treasury/Agency debt with weighted average life of approximately 2.9 years Agency mortgages with weighted average life of approximately 3.1 years 40
Slide 41: Securities Overview - 9/30/11
Securities Overview (1) - 9/30/11 41
Slide 42: Selected Securities - Assessment
Selected Securities - Assessment (1) Par Value Book Value Market Value MTM Alt-A mortgage backed $63 MM $60 MM $52 MM $(8) MM - Purchased 2006 % to Par Value 82% - 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 43: Securities Mix Analysis
(CHART) Securities Mix Analysis 12/31/10 $9.8B (1) 3.2 Years 12/31/08 $4.4 B 5.2Years 12/31/09 $8.6B 2.4 Years Excludes variable rate demand notes: $139 million at 12/31/10 and $90 million at 9/30/11 $658 MM of Agency CMO / MBS classified as HTM included at amortized cost (1) 9/30/11 $9.3 B (1) (2)
Slide 44: Loan Portfolio Overview
Loan Portfolio Overview 44
Slide 45: Credit Exposure Composition
($B) 9/30/11 9/30/11 9/30/11 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 $13.9 36 % $13.1 34 % $12.9 35 % $13.5 33 % $13.1 33 % Commercial real estate 5.9 15 6.7 18 7.7 21
Slide 46: Total Loans and Leases Portfolio Overview by State
(CHART) Total Loans and Leases Portfolio Overview ($B) $20.1 $6.2 $2.9 $1.4 $2.8 $1.4 $0.8 $3.5 EOP Outstandings - $39.0 Billion (1) (1) 9/30/11 By State 46
Slide 47: Loan and Lease Trends Linked Quarter
Loan and Lease Trends Linked Quarter 47
Slide 48: Loan and Lease Trends Prior-Year Quarter
Loan and Lease Trends 48 Prior-Year Quarter
Slide 49: Gross Loan Growth
Gross Loan Growth (CHART) (CHART) Source: SNL; company reports MTB & CMA's growth reflect acquisitions Prior Year Quarter 3Q10-3Q11 Linked Quarter 2Q11-3Q11 49
Slide 50: Total Commercial Loans
Total Commercial Loans 50
Slide 51: Total Commercial Loans - Granularity
(CHART) Total Commercial Loans - Granularity EOP Outstandings - $19.9 Billion (1) (CHART) 777 2% 34,919 98% (1) 9/30/11 Loans by Dollar Size # of Loans by Size $5 MM - < $10 MM 397 $10 MM - < $25 MM 314 $25 MM - < $50 MM 58 > $50 MM 8 Total 777 51
Slide 52: Commercial Loans - Risk Grade Distribution
(CHART) Commercial Loans - Risk Grade Distribution PD Risk Grades (Moody's or Regulatory Definition) Percent of End of Period Balances ($B) $23.6 $20.6 15% 16% 10% 8% 4% 18% 16% 20% 17% 22% 13% 14% 10% 12% 2% 3% 13% 6% 19% 15% 18% 15% 13% 2% $19.7 15% 8% 4% 16% 17% 18% 19% 15% 4% $19.9 52
Slide 53: Commercial and Industrial Loans (C&I)
Commercial and Industrial Loans (C&I) 53
Slide 54: C&I - Overview
C&I - Overview EOP Outstandings - $13.9 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-$500 million in sales Credit Quality T
Slide 55: C&I - Credit Risk Management Strategies
C&I - Credit Risk Management Strategies What We Do Lend to defined relationship oriented clients Follow disciplined credit policies and processes Understand our client's market / industry and their durable competitive advantage Underwrite to historical cash flows with collateral as a secondary repay
Slide 56: C&I Loan Portfolio Composition
(CHART) C&I Loan Portfolio Composition ($B) EOP Outstandings - $13.9 Billion (1) (1) 9/30/11 By Maturity $1.9 $5.8 $1.7 $1.8 $1.5 $1.0 $0.2 56
Slide 57: C&I - Trends
(CHART) C&I - Trends ($MM) Change Analysis Period-End Balance ($MM) 3Q11 vs. 2Q11 3Q11 vs. 3Q10 Originations $961 $3,587 Net payments / payoffs / takedowns (545) (1,824) Net reclassifications 7 (83) Charge-offs (29) (166) Net change $395 $1,514 2.9% 12.2% 57
Slide 58: C&I - Auto Industry
C&I - Auto Industry (1) Outstandings (2) ($MM) 3Q11 2Q11 1Q11 4Q10 3Q10 Suppliers Domestic $ 126 $ 127 $ 135 $ 127 $ 135 Foreign 20 20 23 22 22 Total suppliers 146 146 157 149 157 Dealers Floorplan-domestic 625 651 620 599 470 Floorplan-foreign 289 329 463 457 302 Total floorplan 913 980 1083 1056 7
Slide 59: Commercial Real Estate Loans (CRE)
Commercial Real Estate Loans (CRE) 59
Slide 60: CRE - Overview
CRE - Overview EOP Outstandings - $5.9 Billion (1) Granular portfolio with geographic and project diversification throughout our footprint Construction lending targeted to major metro markets CRE - Construction ($0.5 Billion) 53% reduction in balances since 6/30/10 65% of current balances to "Core"
Slide 61: CRE - Portfolio Composition
(CHART) CRE - Portfolio Composition Permanent 28% Mini-perm Traditional 44% Construction 9% Non Project Loans 7% (CHART) Lines / Letters of Credit 2% (1) 9/30/11 Permanent Qualified 10% Mini-perm Traditional - Typically 2- to 5-year term loans to allow properties to reach stabilized operating levels
Slide 62: CRE - Trends
(CHART) CRE - Trends ($MM) Change Analysis Period-End Balance ($MM) 3Q11 vs. 2Q11 3Q11 vs. 3Q10 Originations $ 140 $ 375 Takedowns 244 717 Net payments / payoffs / other (585) (1,875) Charge-offs (30) (195) Net change $(230) $(978) (3.7)% (14.2)% 62
Slide 63: CRE - Change Analysis
CRE - Change Analysis 2Q11 Construction Commercial Total CRE March 31, 2011 $587 $5,711 $6,298 New originations 0 87 87 Net pay-offs / takedowns / other 8 (192) (184) Charge-offs (4) (33) (37) June 30, 2011 $591 $5,573 $6,164 Net change $4 $(138) $(134) 3Q11 Construction Commercial Total CRE June 30
Slide 64: CRE - Core Characteristics
CRE - Core Characteristics EOP Outstandings - $3.9 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 65: CRE - Noncore Characteristics
CRE - Noncore Characteristics EOP Outstandings - $2.1 Billion (1) Limited opportunity to gain overall banking relationship Includes numerous performing, pass-rated loans not meeting desired return on capital Includes 58% "criticized" loans from the overall CRE portfolio 25% aggressive credit mark Up
Slide 66: CRE - Noncore Characteristics
Special Assets Department (SAD) ($0.9 Billion) 42% aggressive credit mark Actively working to exit... more aggressive terms - e.g., higher pricing, shorter amortization, sale, etc. 72% of "criticized" loans are managed within SAD Other ($1.2 Billion) 9% credit mark represents... 3.4x coverage of NAL
Slide 67: CRE - Core vs. Noncore
CRE - Core vs. Noncore ($MM) O/S ACL Criticized NALs Prior Charge-offs(1) ACL Credit Mark (2) 6/30/11 Core Total $3,985 $140 $424 $26 $ 11 3.51% 3.78% Noncore SAD 988 236 616 239 322 23.89 42.60 Noncore Other 1,191 95 224 26 13 7.98 8.97 Noncore Total 2,179 331 840 266 335 15.19 26.49 CRE Total $6,1
Slide 68: CRE - Core vs. Noncore Change Analysis
CRE - Core vs. Noncore Change Analysis 2Q11 Core Noncore Total CRE March 31, 2011 $3,912 $2,387 $6,298 Originations 87 0 87 Net payments / takedowns / other (45) (140) (185) Charge-offs (3) (34) (37) Classification changes 35 (34) 1 June 30, 2011 $3,985 $2,179 $6,164 3Q11 Core Noncore Total CRE June
Slide 69: CRE - Maturity Schedule By Loan Type
CRE - Maturity Schedule By Loan Type - 9/30/11 ($MM) Within 12 Mos. 1 - 2 Years 2 - 5 Years 5+ Years Total Construction $ 334 $ 128 $ 51 $ 6 $ 520 Lines / letters of credit 71 2 11 10 94 Non project loans 209 58 102 72 441 Mini-perm traditional 1,271 768 592 5 2,635 Permanent qualified 188 111 202 9
Slide 70: Total Consumer Loans and Leases
Total Consumer Loans and Leases 70
Slide 71: Consumer Loans and Leases - 9/30/11
Consumer Loans and Leases - 9/30/11 ($B) Amt. Pct. Automobile $ 5.5 29% Home equity 8.1 42 Residential RE 5.0 26 Other consumer 0.5 3 Total consumer $19.1 100% (CHART) By Loan Type 71
Slide 72: 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 73: Automobile - Overview
Automobile - Overview EOP Outstandings - $5.6 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 74: 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 75: Auto Loans - Production and Credit Quality Overview
Auto Loans - Production and Credit Quality Overview Auto Loans - Production and Credit Quality Overview (1) Annualized 75
Slide 76: Home Equity - Overview
Home Equity - Overview EOP Outstandings - $8.1 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 77: 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 78: Residential Mortgages - Overview
EOP Outstandings - $5.0 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 $497 MM of Interest Only loans... targeted within executive re
Slide 79: Residential Mortgages - Credit Risk Management Strategies
Residential Mortgages - Credit Risk Management Strategies Performance Drivers Standard products and borrower quality - as measured at origination by: Secondary market underwriting FICO score - consistent increasing trend FICO score distribution - consistent decline in low score levels Non-standard p
Slide 80: Residential Mortgages - Credit Risk Management Strategies
Residential Mortgages - Credit Risk Management Strategies Risk Recognition Write down to discounted current value less selling costs at 150 days past due Nonaccrual balances represent the realizable value estimate in future periods Continued Focus on Borrower's Ability to Pay for New Originations Al
Slide 81: Residential Mortgages - LTV, FICO, Originations
Residential Mortgages - LTV, FICO, Originations (1) Weighted average FICOs reflect currently updated customer credit scores (2) Only owned-portfolio originations Weighted average at origination 3Q11 2Q11 1Q11 4Q10 3Q10 Ending balance ($B) $5.0 $4.8 $4.5 $4.5 $4.5 Average LTV 78% 78% 78% 77% 77% Aver
Slide 82: Other Consumer Loans
Other Consumer loans EOP Outstandings - $0.5 Billion (1) Over collateralized Autos, untitled vehicles, small boats, mobile homes and other miscellaneous Primarily for existing customers Performed within expectations over the past year, though varies by collateral type (1) 9/30/11 82
Slide 83: Credit Quality Review
Credit Quality Review 83
Slide 84: Credit Quality Trends Overview
Credit Quality Trends Overview Credit Quality Trends Overview Excludes loans guaranteed by the U.S. Government NALs divided by total loans and leases (3) NPAs divided by the sum of loans and leases, impaired loans held for sale, net other real estate and other NPAs (4) Criticized assets = commercial
Slide 85: Total Commercial Loan - Delinquencies
Total Commercial Loan - Delinquencies (1) (CHART) (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP 90+ Days 30+ Days 85
Slide 86: Total Consumer Loan Delinquencies
(CHART) Total Consumer Loan Delinquencies (1) (CHART) 90+ Days 30+ Days (1) Period end; delinquent but accruing as a % of related outstandings at EOP 86
Slide 87: Consumer Loan Delinquencies
Consumer Loan Delinquencies (1) (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP (2) Excludes GNMA FAS 140 government guaranteed (CHART) (2) (2) (2) (2) 90+ Days 30+ Days 87
Slide 88: Net Charge-Offs
(CHART) Net Charge-Offs ($MM) ($MM) Consumer Loans Commercial Loans (2) (CHART) (1) Includes $16.4 MM related to $39.8 MM of residential mortgages sold and a $4.4 MM Franklin-related recovery (1) 88
Slide 89: Net Charge-Offs
Net Charge-Offs ($MM) 3Q11 2Q11 1Q11 4Q10 3Q10 Commercial and industrial $17.9 $18.7 $42.2 $59.1 $62.2 Commercial real estate 24.4 27.6 67.7 44.9 63.7 Total commercial 42.3 46.3 109.9 104.0 125.9 Automobile 3.9 2.3 4.7 7.0 5.6 Home equity 26.2 25.4 26.7 29.2 27.8 Residential mortgages (1) 11.6 16.5
Slide 90: Nonaccrual Loans and Nonperforming Assets
(CHART) Nonaccrual Loans and Nonperforming Assets ($MM) (CHART) ($MM) (15)% (18)% (18)% (21)% (62)% NAL Inflows NALs & NPAs - EOP (3)% (19)% (8)% (27)% 10% 90
Slide 91: Nonaccrual Loans (NALs) and Nonperforming Assets (NPAs)
Nonaccrual Loans (NALs) and Nonperforming Assets (NPAs) 91
Slide 92: Nonperforming Asset Flow Analysis
($MM) 3Q11 2Q11 1Q11 4Q10 3Q10 NPA beginning-of-period $652.9 $690.9 $844.8 $1,104.9 $1,582.7 Additions / increases 153.6 210.3 192.0 237.8 278.4 Franklin - net impact (0.3) (5.1) (3.5) (5.9) (251.4) Return to accruing status (25.8) (68.4) (70.9) (100.1) (111.2) Loan and lease losses (80.0) (74.9) (
Slide 93: Total Commercial Loans - Criticized Loan Flow Analysis
($MM) 3Q11 2Q11 1Q11 4Q10 3Q10 Criticized beginning-of-period $2,379 $2,661 $3,074 $3,638 $4,106 Additions / increases 357 250 170 290 408 Advances 46 44 62 52 75 Upgrades to "Pass" (252) (272) (239) (383) (391) Paydowns (181) (232) (295) (401) (409) Charge-offs (58) (73) (112) (121) (152) Criticize
Slide 94: Accruing Loans Days Past Due and Troubled Debt Restructured Loans
Accruing Loans 90 Days Past Due and Troubled Debt Restructured Loans 94
Slide 95: Provision, NCO, and ACL
(CHART) (CHART) Provision, NCO, and ACL ($MM) (1) End of period Allowance for Credit Losses vs. NALs (1) Loan Loss Provision vs. Net Charge-offs 95
Slide 96: Relative Performance - ALLL / NAL Coverage
(CHART) Relative Performance - ALLL / NAL Coverage Source: SNL; company reports 96
Slide 97: Relative Performance - LLR/Loans Ratios
(CHART) Relative Performance - LLR/Loans Ratios Source: SNL; company reports 97
Slide 98: Rapid Improvement in Credit Quality - Nonaccrual Loans Ratio
Rapid Improvement in Credit Quality - Nonaccrual Loans Ratio 9/30/11 Change from 9/30/10 (CHART) Source: SNL; company reports (CHART) 98
Slide 99: Rapid Improvement in Credit Quality - Loan Loss Reserves / Nonaccrual Loans
Rapid Improvement in Credit Quality - Loan Loss Reserves / Nonaccrual Loans (CHART) (CHART) Source: SNL; company reports 9/30/11 Change from 9/30/10 99
Slide 100: Deposits and Other Funding
Deposits and Other Funding 100
Slide 101: Deposits
(CHART) (CHART) Deposits ($B) Avg. Total Deposits - Rate / Mix Core CD Maturities & Avg. Maturity Rate Rate1.21% 1.06% 0.90% 0.82% 0.77% Estimates 101
Slide 102: Deposit Trends Linked Quarter
Deposit Trends Linked Quarter 102
Slide 103: Deposit Trends Prior-Year Quarter
Deposit Trends Prior-Year Quarter 103
Slide 104: Total Core Deposit Trends
Total Core Deposit Trends 104
Slide 105: Other Funding End of Period Balances
(CHART) Other Funding End of Period Balances ($B) 26% 16% 0% 27% 13% $7.7 20% 3% 22% 32% 29% $9.4 20% 32% 2% 29% 28% 105 0%
Slide 106: Capital
Capital 106
Slide 107: Capital
Capital (1) 3Q11 2Q11 1Q11 4Q10 3Q10 Tang. common equity/ tang. assets 8.22% 8.22% 7.81% 7.56% 6.20% Tang. equity/tang. assets 8.88 8.91 8.51 8.24 9.43 Tier 1 common risk-based capital 10.17 9.92 9.75 9.29 7.39 Tier 1 leverage 10.24 10.25 9.80 9.41 10.54 Tier 1 risk-based capital 12.37 12.14 12.04 1
Slide 108: Capital Ratios
(CHART) Capital Ratios (1) End-of-period 4Q10 - Raised $920 MM of common equity and repurchased $1.4 B of TARP related preferred shares (2) 108
Slide 109: Shareholders' Equity and Key Equity Ratios
(CHART) Shareholders' Equity - Avg. (CHART) Capital Key Equity Ratios - EOP ($B) 109 4Q10 - Raised $920 MM of common equity and repurchased $1.4 B of TARP related preferred shares
Slide 110: Capital Analysis - 9/30/11
(CHART) Capital Analysis - 9/30/11 (CHART) Source: SNL, Company reports. Tier 1 Common Risk-Based Tangible Common Equity TARP- fully repaid 110
Slide 111: Franchise and Leadership
Franchise and Leadership 111
Slide 112: Huntington Bancshares Overview
Huntington Bancshares Overview Midwest financial services holding company Founded - 1866 Headquarters - Columbus, Ohio Total assets - $55 Billion Employees (1) - 11,473 Franchise: Footprint 6 states: OH, MI, PA, IN, WV, KY 650 branches / 1,348 ATMs Retail and Business Banking 5 Areas - Mortgage bank
Slide 113: The Huntington Franchise
The Huntington Franchise Branches 119 ATMs 240 Detroit 4% Grand Rapids 10% Branches 365 ATMs 834 Akron 8% Canton 28% Cincinnati 3% Cleveland 8% Columbus 24% Dayton 6% Toledo 24% Youngstown 21% Branches 50 ATMs 70 Indianapolis 7% Branches 13 ATMs 26 Branches 30 ATMs 131 Charleston 10% Includes 14 PFG
Slide 114: A Strong Regional Presence
A Strong Regional Presence Source: SNL Financial, company presentations and filings FDIC deposit data as of June 30, 2011 Deposits - Top 12 MSAs MSA Rank BBs Deposits Share Columbus, OH 1 77 $10,318 24.1% Cleveland, OH 5 78 4,056 8.0 Detroit, MI 8 52 3,239 4.3 Toledo, OH 1 42 2,350 24.0 Pittsburgh,
Slide 115: Leadership Team
Leadership Team Leadership Team Business Segments Insurance, 115
Slide 116: Senior Leadership Team
Senior Leadership Team (1) Includes related experience outside of banking 116
Slide 117: Business Segment Overview
Business Segment Overview 117
Slide 118: Business Segment Loans & Deposits - 3Q11
Business Segment Loans & Deposits - 3Q11 Average Total Deposits - $42.3 B Average Total Loans - $39.3 B (CHART) (CHART) AFCRE $13.1B 33% Retail & Business Banking $11.9B 31% Treasury / Other $0.1B 0% Regional & Comm'l Banking $8.1B 22% WGH $5.3B 14% AFCRE $0.8B 2% Treasury / Other $1.0B 3% Retail &
Slide 119: Total Loans and Leases - By Business Segment
Total Loans and Leases - By Business Segment Total Loans and Leases - By Business Segment Avg. Outstandings - $39.3 Billion 3Q11 119
Slide 120: Total Deposits - By Business Segment
Total Deposits - By Business Segment Total Deposits - By Business Segment Avg. Balances - $42.3 Billion 3Q11 120
Slide 121: Business Segment Contribution
Business Segment Contribution ($MM) 3Q11 2010 2009 2008 Retail & Business Banking $37.3 $131.0 $(26.5) $257.8 Regional & Commercial Banking 18.5 38.5 (158.7) 80.3 AFCRE 66.5 46.5 (588.2) (14.2) WGH 0.6 34.8 1.8 43.0 Treas. / Other 20.4 61.6 (251.3) (480.8) Unallocated goodwill impairment (1) -- -- (
Slide 122: Business Segment Overview
Business Segment Overview Regional & 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
Slide 123: 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 123
Slide 124: Regional Banking Presidents
Regional Banking Presidents 124
Slide 125: Retail and Business Banking Areas
5 Retail and Business Banking Areas Central Northwest West Northeast East Mary Navarro 125
Slide 126: Giant Eagle / Huntington Partnership
#1 in Ohio Branches Planned Rollout 12% the cost of a traditional branch 32 opened 28 in 2011 89 by end of 2015 Cash flow breakeven in < 2 years Increase Convenience - Ohio Branch share source, SNL Financial, 6/30/2011 % of Branches % of Branches % of Branches MSA 6/11 Pro Forma (1) Pro Forma (1) Ak
Slide 127: Retail & Business Banking Executives
Retail & Business Banking Executives 127
Slide 128: 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 129: Safe Harbor Disclosures
Safe Harbor Disclosures 129
Slide 130: 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 131: 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 132: 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 133: 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
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