Huntington Bancshares Incorporated · NASDAQ:HBAN
Huntington Bancshares — Investor Presentation (February 2011)
162 slides from Huntington Bancshares's investor presentation, Feb 25, 2011
Slide 1: 2011 First Quarter Investor Handout
2011 First Quarter Investor Handout February 24, 2011
Slide 2: Table of Contents
Table of Contents Current Topics 3Quarterly Financial Review 29 Significant items impacting comparisons 36Income Statement 37 Revenue & PTPP Growth 38 Net interest margin 40 Noninterest income 43 Noninterest expense 47Balance Sheet 49Investment Securities 53Loan Portfolio Overview 59 Credit exposure
Slide 3: Current Topics
Current Topics
Slide 4: Huntington - A Break Away Opportunity
We are...Investing in revenue-generating businessesGoing beyond the expected overdraft revenue decline to offer transparency and fair value to our customersGaining share-of-walletTaking market share Huntington - A Break Away Opportunity 4
Slide 5: Driving Customer and Revenue Growth
Driving Customer and Revenue Growth 5 Deeper service and product penetration of existing customersRigorous and disciplined sales management and sales processRobust sales/ cross-referral technology - MAXBroad array of services and products
Slide 6: Driving Customer and Revenue Growth: Fair Play
Driving Customer and Revenue Growth 6 Grow customer base and take market share"Fair Play" - a compelling banking philosophy
Slide 7: Our Fair Play Banking Philosophy
Our "Fair Play" Banking Philosophy 7 Deliver a Category of One customer experience that drives higher relative customer satisfaction and acquisition and retentionSimple / compelling products priced fairly and transparently... our version of Southwest Airline's successful "The Bags Fly Free"(r) marke
Slide 8: Fair Play Banking - Roll Out 24-Hour Grace
"Fair Play" Banking - Roll Out 24-Hour Grace(tm) 8 Trademark Registration and Patent Pending - A Huntington exclusiveCustomers just need to make a deposit during the next business day to make it rightAutomatically provided for free on all consumer accountsResearch showed broad and strong appeal to a
Slide 9: Fair Play Philosophy - Early Stage Observations
$10.1 MM Linked quarter decline in service charges on deposit accounts. Included the impact from: 3Q10 implementation of changes to Regulation E 3Q10 introduction of our "Fair Play" banking philosophyContinued change in customer behavior6.6%, 2010 household growth...1% higher than estimatedOpt-in ra
Slide 10: Driving Customer and Revenue Growth: Increase Convenience
Driving Customer and Revenue Growth 10 Grow customer base and take market share"Fair Play" - a compelling banking philosophyIncrease convenience and multiply the effective size of our existing footprint
Slide 11: Increase Convenience - Cleveland
Increase Convenience - Cleveland 11 67 hrs/week - More than Other BanksMore Hours = More RevenueLeverages Existing Distribution53 Cleveland branchesM-F, 8a-7p; Sat, 8a-4p; Sun, 12-4pCreates Revenue LiftChecking sales 28% higherBalance growthHigher service charge incomeMajority of new accounts from l
Slide 12: Increase Convenience - Ohio Branch Share
Increase Convenience - Ohio 12 Branch share source, SNL Financial, 6/30/2010 % of Branches % of Branches % of Branches MSA 6/10 Pro Forma (1) Pro Forma (1) Akron 7.8% 14.1% #2 Canton 18.0% 23.1% #1 Cleveland 8.8% 15.0% #1 Columbus 12.2% 15.6% #1 Youngstown 18.1% 22.9% #1 372 Branches + 101 In-Store
Slide 13: Selective Out-of-Footprint Expansion
Driving Customer and Revenue Growth 13 Grow customer base and take market share"Fair Play" - a compelling banking philosophyIncrease convenience and multiply the effective size of our existing footprintSelective out-of-footprint expansionAuto Finance and Dealer ServiceCentral and Eastern Pennsylvani
Slide 14: Building Revenue Streams - Auto Pennsylvania Expansion
(CHART) Loans - Avg. (CHART) Building Revenue Streams - Auto Pennsylvania Expansion 14 ($MM) ($MM) Total Revenue
Slide 15: Auto Lending - Deep Relationships Drive Value
Auto Lending - Deep Relationships Drive Value 15 Deep relationships with high quality DealersConsistently in the market for over 50 yearsFloorplan and dealership real estate lending, core deposit relationship, full Treasury Management and private banking etcThat deep relationship adds value ...buy r
Slide 16: Market Leader
Market Leader (1) 16 (CHART) 2010Originations 4Q10 Rank (2) #1 #1 #1 #1 #4 #4 $1,426 MM 466 417 174 365 572 $3,420 MM Source : AutoCount % of total financed vehicles excluding captive finance companies
Slide 17: Driving Customer and Revenue Growth: Build a Powerful Brand
Driving Customer and Revenue Growth 17 Build a powerful brandThe Bank committed to the MidwestFull commitmentMaking investmentsSourcing locallyBig enough to make an impact on our communities
Slide 18: Invest in Revenue-Generating Businesses
Driving Customer and Revenue Growth 18 Invest in revenue-generating businesses like...Treasury management services Foreign exchange and derivatives Commercial large corporate
Slide 19: Building Revenue Streams - FX, Derivatives, Treasury Management
(CHART) Foreign Exchange& Derivatives (CHART) Treasury Management Services (1) Building Revenue Streams - 19 ($MM) ($MM) Historical data restated due to change in internal reporting
Slide 20: Building Revenue Streams - Large Corporate
(CHART) (CHART) Building Revenue Streams - Commercial Banking Large Corporate 20 ($MM) ($MM) Total Revenue
Slide 21: Rapid Improvement in Credit Quality
(CHART) (CHART) Rapid Improvement in Credit Quality 21 ($MM) (28)% (45)% (17)% (12)% (7)% (52)% Allowance for Credit Losses vs.NALs - EOP NALs & NPAs - EOP (18)% 62% (24)% (16)%
Slide 22: Rapid Improvement in Credit Quality - Nonaccrual Loans Ratio
Rapid Improvement in Credit Quality - Nonaccrual Loans Ratio 22 12/31/10 Change from 12/31/09 (CHART) Source: SNL; company reports (CHART)
Slide 23: Rapid Improvement in Credit Quality - Loan Loss Reserves
Rapid Improvement in Credit Quality - Loan Loss Reserves / Nonaccrual Loans 23 12/31/10 (CHART) (CHART) Change from 12/31/09 Source: SNL; company reports
Slide 24: Capital
Capital (1) 24 4Q10 3Q10 2Q10 1Q10 4Q09 Total risk-weighted assets ($B) $43.5 $42.7 $42.5 $42.5 $43.2 Tier 1 leverage 9.41% 10.54% 10.45% 10.05% 10.09% Tier 1 risk-based capital 11.55 12.82 12.51 12.00 12.15 Total risk-based capital 14.46 15.08 14.79 14.31 14.55 Tang. common equity/ tang. assets 7.5
Slide 25: Capital Analysis - 12/31/10
(CHART) Capital Analysis - 12/31/10 25 (CHART) Source: SNL, Company reports. Tier 1 Common Risk-Based Tangible Common Equity TARP repaid bank
Slide 26: ROA Opportunity Sensitivity Analysis
ROA Opportunity 26 Sensitivity Analysis on $260MM - 4Q10 1.10%-1.35% Long-Term Goal
Slide 27: 2011 Expectations
2011 Expectations (1) Economy remains relatively stable with the potential for improvementContinued growth in earnings, initially driven by improvement in credit and reductions in provisions for credit lossesPre-tax, pre-provision income in line with reported 2H10 performance Net interest margin...
Slide 28: Important Messages
Important Messages Strong balance sheetCapitalGenerating capital internallyCapacity to consider capital management activitiesSubstantially improved credit quality performance... the timeframe of returning to "normal" is shorteningStrategic initiatives continue to gain traction though revenue growth
Slide 29: Quarterly Financial Review
Quarterly Financial Review
Slide 30: 2010 Fourth Quarter, Seeing Results
$122.9 MM reported net income $0.05 EPSIncluding $0.07 impact for the TARP related deemed dividend $260.1 MM pre-tax, pre-provision income (1), down $5.2 MM, or 1.9%$3.5 MM, or 0.5%, increase in fully-taxable equivalent revenue$6.4 MM, or 1.6%, increase in fully-taxable equivalent net interest incom
Slide 31: 2010 Fourth Quarter, Seeing Results (continued)
Strong reserves 3.39% period-end allowance for credit losses to total loans and leases, down from 3.67%.166% ACL coverage of NALs, up from 140%Solid capitalRepurchased $1.4 B of TARP related preferred capital7.56% tangible common equity ratio, up 136 bps9.29% Tier 1 common risk-based capital ratio,
Slide 32: 2010 Fourth Quarter, Significant Capital Impacts
12/14 - $920.0 MM of common stock,146.0 MM shares @ $6.30/share12/17 - $300.0 MM of 10-year, 7.0% fixed-rate subordinated debt12/22 - Completed repurchase of $1.4 B of TARP capitalSelected ImpactsTangible common equity ratio 7.56%, +136 bpCommon equity issuance ($883.9 MM net proceeds) +168 Net inco
Slide 33: Quarterly Performance Highlights
Quarterly Performance Highlights 33 4Q10 3Q10 2Q10 1Q10 4Q09 EPS $0.05 $0.10 $0.03 $0.01 $(0.56) Pre-tax pre-provision income ($MM) (1) $260.1 $265.2 $270.5 $251.8 $242.1 Net interest margin 3.37% 3.45% 3.46% 3.47% 3.19% Efficiency ratio (2) 61.4% 60.6% 59.4% 60.1% 49.0% Loan & lease growth (3) 6% 1
Slide 34: 4Q10 Earnings Summary
4Q10 Earnings Summary After-tax EPSNet income $122.9 MM Net income applicable to common shares $39.1 MM $0.05 (1)Significant Items Favorable/(Unfavorable) Earnings (2) EPS Deemed dividend NA $(0.07)(1) EPS reflected on a fully diluted basis(2) Impact on pre-tax GAAP earningsNA Not applicable 34
Slide 35: Quarterly Earnings
Quarterly Earnings Change vs. (smu 30 708 3010 4009 a Net interest income $ 410.0 $3744 $ 53 1 %/S 41.2 1% Provision 119.2 894.0 322 © (27) 8070 90 Noninterest income 26741 245 ey 178 Noninterest expense 427.3 3226 (7.3) 2 (112.0) (35) % Pre-tax income/(loss) 130.6 (698.0) ral 755.9 NR ‘Net Income/(
Slide 36: Significant Items Impacting Financial Performance Comparisons - Reconciliation
Significant Items Impacting Financial Performance Comparisons - Reconciliation 36 2010 - 2009 Quarterly
Slide 37: Income Statement
Income Statement
Slide 38: Revenue and PTPP Growth
(CHART) Revenue and PTPP Growth (1) 38 ($MM) (CHART) (1) Revenue is FTE; See Basis of Presentation for definition of PTPP, as well as PTPP Income reconciliation slide(2) Annualized PTPP Earnings Power (2) Revenue and PTPP Trends
Slide 39: Pre-Tax, Pre-Provision Income
Pre-Tax, Pre-Provision Income (1) 39
Slide 40: Net Interest Income & Margin
(CHART) (CHART) Change 4Q10 vs. 3Q10:Funding mix 5 bpsEarning asset volume (7)Rate changes & other (4) Asset /liability mgmt. strategies (2) Total change (8) bps Net Interest Income & Margin (1) 40 ($MM) (1) Fully-taxable equivalent basis Net Interest Margin (FTE) Net Interest Income (FTE)
Slide 41: Net Interest Margin - Yields & Rates
Net Interest Margin - Yields & Rates 41 (CHART) (CHART) Earning Assets Total Deposits Fed Funds Net Interest Margin Loans Investment Securities Earning Asset Yields NIM - Yields & Rates
Slide 42: Managing Interest Rate Risk
(CHART) Managing Interest Rate Risk 42 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 already implied in the current yield curve. Net Interest Income at Risk (1) Forwar
Slide 43: Noninterest Income Trends Linked Quarter
Noninterest Income Trends 43 Linked Quarter
Slide 44: Noninterest Income Trends Prior-Year Quarter
Noninterest Income Trends 44 Prior-Year Quarter
Slide 45: Interchange Update
Estimate in SeptemberSignature rate goes to pin rate Annual revenue at risk ~ $90 MM Estimated annual reduction ~ $54 MM 60%Estimate based on Federal Reserve 12/16/10 proposal$0.07 would be an ~85% reduction$0.12 would be a ~75% reduction Interchange Update 45
Slide 46: Mortgage Banking Income
Mortgage Banking Income 46 ($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 Origination & secondary marketing $48.2 $35.8 $19.8 $13.6 $16.5 Servicing fees 11.5 12.1 12.2 12.4 12.3 Amortization of capitalized servicing (14.0) (13.0) (10.1) (10.1) (10.8) Other mortgage banking income 4.8 5.0 3.7 3.2 4.5 Sub-total 50.5
Slide 47: Noninterest Expense Trends Linked Quarter
Noninterest Expense Trends 47 Linked Quarter
Slide 48: Noninterest Expense Trends Prior-Year Quarter
Noninterest Expense Trends 48 Prior-Year Quarter
Slide 49: Balance Sheet
Balance Sheet
Slide 50: Balance Sheet - Assets
Balance Sheet - Assets Dec."10.vs.08 (in mitions) ‘Anunt Percent ‘Assets ‘Cash and due frombanks. S673) 44.3% Interest bearing depos in banks 135 (184) 87.7% Trading account securities 485 102 121.6% Loans heli for sale 193 332 71.8% fnvestment securities 9,895 1307 182% Loans and leases: Commercial
Slide 51: Balance Sheet - Liabilities & Shareholders' Equity
Balance Sheet - Liabilities & Shareholders' Equity 51
Slide 52: Earning Assets and Funding Composition
Earning Assets and Funding Composition (1) 52 (CHART) (1) Average balances (2) Interest bearing liabilities + DDA noninterest bearing (CHART) Funding (2) Earning Asset Composition
Slide 53: Investment Securities
Investment Securities
Slide 54: Investment Securities
(CHART) (CHART) Investment Securities 54 ($MM) % of Average Earning Assets Average Balance & Yield
Slide 55: Investment Securities Trends
Investment Securities Trends (1) 55 Linked Quarter - Average Treasury/Agency debt with weighted average life of approximately 2.5 yearsAgency CMOs with weighted average life of approximately 3.2 yearsCash from asset sales and deposit growth was invested in comparable duration securitiesSold $188 MM
Slide 56: AFS Securities Overview - 12/31/10
AFS Securities Overview (1) - 12/31/10 56
Slide 57: Investment Securities - Assessment
Investment Securities - Assessment (1) 57 Par Value Book Value Market Value OCIAlt-A mortgage backed $72 MM $69 MM $60 MM $(9) MM - Purchased 2006 % to Par Value 84% - 3 securities - senior tranche - 10/1 ARMs or 30 year fixed; no option ARMs - Cash flow analysis performed monthly to test for OTTI w
Slide 58: Available for Sale Securities Mix
(CHART) Available for Sale Securities Mix 58 12/31/10$9.8 B (1)3.0 Years 12/31/07$4.1 B3.2 Years 12/31/08$4.0 B5.2 Years 12/31/09$8.2 B2.4 Years Excludes $139 million of variable rate demand notes (1)
Slide 59: Loan Portfolio Overview
Loan Portfolio Overview
Slide 60: Credit Exposure Composition
($B) 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 12/31/06 12/31/06 12/31/06 Amt Pct Amt Pct Amt Pct Amt Pct Amt Pct Commercial & industrial $13.1 34 % $12.9 35 % $13.5 33 % $13.1 33 % $7.8 30 % Commercial real estate 6.7 18 7.7 21 10.1
Slide 61: Total Loans and Leases Portfolio Overview
(CHART) Total Loans and Leases Portfolio Overview 61 ($B) $20.0 $5.9 $2.7 $0.9 $2.7 $1.6 $0.7 $3.6 EOP Outstandings - $38.1 Billion (1) (1) 12/31/10 By State
Slide 62: Loan and Lease Trends Linked Quarter
Loan and Lease Trends 62 Linked Quarter
Slide 63: Loan and Lease Trends Prior-Year Quarter
Loan and Lease Trends 63 Prior-Year Quarter (1) Reflects 1Q10 impact of bringing back on the balance sheet a $0.7 B automobile loan securitization, $0.5 B remaining as of 12/31/2010 (1)
Slide 64: Total Commercial Loans
Total Commercial Loans
Slide 65: Total Commercial Loans - Granularity
(CHART) Total Commercial Loans - Granularity 65 EOP Outstandings - $19.7 Billion (1) (CHART) 776 2% 37,07898% (1) 12/31/10 Loans by Dollar Size # of Loans by Size $5 MM - < $10 MM 428$10 MM - < $25 MM 292$25 MM - < $50 MM 48> $50 MM 8Total 776
Slide 66: Commercial Loans - Risk Grade Distribution
(CHART) Commercial Loans - Risk Grade Distribution 66 PD Risk Grades (Moody's or Regulatory Definition) Percent of End of Period Balances ($B) $23.6 $20.6 $19.6 10% 16% 4% 8% 15% 18% 16% 20% 17% 22% 13% 14% 10% 12% 2% 2% 3% 13% 6% 19% 15% 18% 15% 13% 2% $19.3 15% 6% 19% 15% 17% 14% 11% 11% 5% 19% 16
Slide 67: Commercial and Industrial Loans (C&I)
Commercial and Industrial Loans (C&I)
Slide 68: C&I - Overview
C&I - Overview 68 EOP Outstandings - $13.1 Billion (1)Diversified by sector and geographically within our Midwest footprintGranular7 loans >$50 million... 4% of portfolio52 loans $20-$50 million... 11% of the portfolioFocus on middle market companies with $15-$100 million in salesCredit Quality Tren
Slide 69: C&I - Credit Risk Management Strategies
C&I - Credit Risk Management Strategies 69 What We DoLend to defined relationship oriented clientsFollow disciplined credit policies and processesUnderstand our client's market / industry and their durable competitive advantageUnderwrite to historical cash flows with collateral as a secondary repaym
Slide 70: C&I Loan Portfolio Composition
(CHART) C&I Loan Portfolio Composition 70 ($B) EOP Outstandings - $13.1 Billion (1) (1) 12/31/10 By Maturity $1.7 $4.9 $1.5 $1.5 $2.2 $1.0 $0.3
Slide 71: C&I - Trends
(CHART) C&I - Trends 71 ($MM) Change Analysis Period-End Balance ($MM) 4Q10 vs. 3Q10 4Q10 vs. 4Q09 Originations $1,074 $2301 Net payments / payoffs / takedowns (232) (1,693) Net reclassifications (133) (133) Charge-offs (72) (300) Net change $638 $175 5.1% 1.4%
Slide 72: C&I - Auto Industry
C&I - Auto Industry (1) 72 Outstandings (2) ($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 Suppliers Domestic $ 127 $ 135 $ 136 $ 147 $ 163 Foreign 22 22 24 24 24 Total suppliers 149 157 160 171 187 Dealers Floorplan-domestic 599 470 411 363 388 Floorplan-foreign 457 302 292 296 283 Total floorplan 1056 772 703 659
Slide 73: Commercial Real Estate Loans (CRE)
Commercial Real Estate Loans (CRE)
Slide 74: CRE - Overview
CRE - Overview 74 EOP Outstandings - $6.7 Billion (1)Granular portfolio with geographic and project diversification throughout our footprintConstruction lending targeted to major metro marketsCRE - Retail ($1.8 Billion)Loans originated with quality developers that have experience and financial capac
Slide 75: CRE - Portfolio Composition
(CHART) CRE - Portfolio Composition 75 Permanent 29% Mini-perm Traditional41% Construction 10% Non Project Loans 8% (CHART) Lines / Letters of Credit3% (1) 12/31/10 Permanent Qualified9% Mini-perm Traditional - Typically 2- to 5-year term loans to allow properties to reach stabilized operating level
Slide 76: CRE - Trends
(CHART) CRE - Trends 76 ($MM) Change Analysis Period-End Balance ($MM) 4Q10 vs. 3Q10 4Q10 vs. 4Q09 Originations $ 55 $ 167 Takedowns 169 738 Net payments / payoffs / other (570) (1,794) Net reclassifications 138 (161) Charge-offs (53) (309) Net change $(261) $(1,038) (3.8)% (13.5)%
Slide 77: CRE - Change Analysis
CRE - Change Analysis 77 4Q10 Retail Other Total CRE September 30, 2010 $1,867 $5,044 $6,912 New originations 7 48 55 Net pay-offs / takedowns / other (97) (166) (263) Charge-offs (16) (38) (53) December 31, 2010 $1,762 $4,888 $6,651 Net change $(105) $(156) $(261) 3Q10 Retail Other Total CRE June 3
Slide 78: CRE - Credit Quality - By Property Type
CRE - Credit Quality - By Property Type 78 Annualized %% of related EOP outstandings NCOs (1) NALs (2)
Slide 79: CRE - Credit Quality By Loan Type
CRE - Credit Quality 79 By Loan Type - 12/31/10 ($MM) O/S 30+ PD Accruing Class. NAL's ACL Construction $651 0.37% 33.22% 18.84% 23.33% Lines / letters of credit 196 8.86 28.07 8.20 10.55 Non project loans 544 0.23 7.98 2.50 5.30 Mini-perm traditional 2,725 0.95 18.34 4.35 7.78 Permanent qualified 6
Slide 80: CRE - Retail
CRE - Retail 80 ($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 Community centers $870 $932 $979 $1,011 $1,037 Mixed / lifestyle 216 219 239 255 253 Regional centers 168 177 172 175 174 Credit / freestanding 203 230 246 252 266 Other 307 309 325 371 385 Retail exposure trends $1,762 $1,867 $1,960 $2,064 $2,115 EOP O
Slide 81: CRE - Retail - Credit Quality
CRE - Retail - Credit Quality 81 EOP Outstandings - $1.8 Billion (1) ($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 30+ days PD (2) - $ 97 101 139 190 197 - % 5.52 5.43 7.08 9.20 9.32 30+ days PD & accruing (2) - $ 22 15 14 22 42 - % 1.24 0.83 0.72 1.06 1.98 Classified (2) - $ 351 414 458 525 461 - % 19.89 22.2 23.
Slide 82: CRE - Portfolio Positioning
CRE - Portfolio Positioning 82 Segmented Into "Core" and "Noncore" PortfoliosCore Well-seasoned regional or institutional owners, developers, and organizationsMeaningful relationship in place - opportunities for additional cross- sellPrimarily Midwest footprint projects generating adequate return on
Slide 83: CRE - Core Characteristics
CRE - Core Characteristics 83 EOP Outstandings - $4.0 Billion (1)Long-term relationships... many have been customers for 20+ years.Proven CRE participants... 28+ years average CRE experience95+% of the loans have personal guaranteesIncome producing loans have weighted average debt service coverage o
Slide 84: CRE - Noncore Characteristics
CRE - Noncore Characteristics 84 EOP Outstandings - $2.6 Billion (1)Overall27% aggressive credit markUpdated values to incorporate current market conditionsLimited future funding requirements... ~$75 MM95+% have guarantors99% is secured debt93% is within our geographic footprint49% are "pass" grade
Slide 85: CRE - Noncore Characteristics
Special Assets Department (SAD) ($1.4 Billion)40% aggressive credit markActively working to exit... more aggressive terms - e.g., higher pricing, shorter amortization, sale, etc.The majority of "criticized" loans are managed within SADOther ($1.2 Billion)9% credit mark represents... 2.6X coverage of
Slide 86: CRE - Core vs. Noncore
CRE - Core vs. Noncore 86 ($MM) O/S ACL Criticized NAL's Prior Charge-offs(1) ACL Credit Mark (2) 9/30/10 Core Total $3,989 $165 $532 $51 $ 2 4.14% 4.18% Noncore SAD $1,394 $360 $1,084 $353 $469 25.80% 44.50% Noncore Other 1,529 138 359 75 33 9.02% 10.95% Noncore Total $2,923 $498 $1,443 $427 $502 1
Slide 87: CRE - Portfolio Composition by Type and Location
CRE - Portfolio Composition - 12/31/10 87 By Property Type and Property Location
Slide 88: CRE - Core vs. Noncore Change Analysis
CRE - Core vs. Noncore Change Analysis 88 3Q10 ($MM) Core Noncore Total CRE June 30, 2010 $3,965 $3,219 $7,184 Originations 106 -- 106 Net payments / takedowns / other (80) (221) (301) Charge-offs (2) (75) (77) September 30, 2010 $3,989 $2,923 $6,912 Net change $25 $(296) $(271) 4Q10 Core Noncore To
Slide 89: CRE - Maturity Schedule By Loan Type
CRE - Maturity Schedule 89 By Loan Type - 12/31/10 ($MM) Within 12 Mos. 1 - 2 Years 2 - 5 Years 5+ Years Total Construction $ 421 $ 146 $ 77 $ 6 $ 651 Lines / letters of credit 141 33 11 11 196 Non project loans 262 104 118 60 544 Mini-perm traditional 1,603 539 583 -- 2,725 Permanent qualified -- 9
Slide 90: Total Consumer Loans and Leases
Total Consumer Loans and Leases
Slide 91: Consumer Loans and Leases - 12/31/10
Consumer Loans and Leases - 12/31/10 91 ($B) Amt. Pct. Auto loans & leases $5.6 31% Home equity 7.7 42 Residential RE 4.5 25 Other consumer 0.6 3 Total consumer $18.4 100% (CHART) By Loan Type
Slide 92: Consumer Loan Credit Risk Management Objective
Consumer Loan Credit Risk Management Objective 92 Manage the Probability of DefaultFootprint Portfolio... markets we know and understandClient Selection... bias for high quality customers and relationship lending vs. third-party originationsDisciplined Underwriting... borrower ability to repay, coll
Slide 93: Automobile Loans and Leases
Automobile Loans and Leases
Slide 94: Auto Loans & Leases - Overview
Auto Loans & Leases - Overview 94 EOP Outstandings - $5.6 Billion (1)Consistency of strategy and commitment to dealersFocus on high service quality and high quality full dealer relationshipsSince 2001 focused on super-prime customers >750 FICOsFully automated origination and booking systemCredit Qua
Slide 95: Auto Lending - Credit Risk Management Strategies
Auto Lending - Credit Risk Management Strategies 95 Performance DriversBorrower 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 appli
Slide 96: Auto Loans - Production and Credit Quality Overview
Auto Loans - Production and Credit Quality Overview 96 96 (1) Annualized
Slide 97: Home Equity
Home Equity
Slide 98: Home Equity - Overview
Home Equity - Overview 98 EOP Outstandings - $7.7 Billion (1)Focused on geographies within our Midwest footprintFocused on high quality borrowers... >730 FICOsBegan exit of broker channel in 2005... <8% of outstandings todayConservative underwriting - manage the probability of defaultHigh risk borro
Slide 99: Home Equity - Credit Risk Management Strategies
Home Equity - Credit Risk Management Strategies 99 Performance DriversBorrower quality - as measured at origination byCustom Score - utilized to further segment FICO eligible applications - continues to enhance predictive modeling FICO score - consistent increasing trend, with very limited under 670
Slide 100: Residential Mortgages
Residential Mortgages
Slide 101: Residential Mortgages - Overview
Residential Mortgages - Overview 101 EOP Outstandings - $4.5 Billion (1)Focused on geographies within our Midwest footprintTraditional product mix... very limited nontraditional exposure as we never originated sub-prime, payment option ARMs, or negative amortization loans$527 MM of Interest Only loa
Slide 102: Residential Mortgages - Credit Risk Management Strategies
Residential Mortgages - Credit Risk Management Strategies Performance DriversStandard products and borrower quality - as measured at origination by:Secondary market underwritingFICO score - consistent increasing trendFICO score distribution - consistent decline in low score levels Non-standard produ
Slide 103: Residential Mortgages - Credit Risk Management Strategies 3
Residential Mortgages - Credit Risk Management Strategies 103 Risk RecognitionWrite down to discounted current value less selling costs at 180 days past dueNonaccrual balances represent the realizable value estimate in future periodsContinued Focus on Borrower's Ability to Pay for New OriginationsAl
Slide 104: Residential Mortgages - LTV, FICO, Originations
Residential Mortgages - LTV, FICO, Originations 104 (1) Weighted average FICOs reflect currently updated customer credit scores(2) Only owned-portfolio originationsWeighted average at origination 4Q10 3Q10 2Q10 1Q10 4Q09 Ending balance ($B) $4.5 $4.5 $4.4 $4.6 $4.5 Average LTV 77% 77% 77% 76% 77% Av
Slide 105: Other Consumer Loans
Other Consumer Loans
Slide 106: Other Consumer Loans
Other Consumer loans 106 EOP Outstandings - $0.6 Billion (1)60% collateralizedAutos, untitled vehicles, small boats, mobile homes and other miscellaneousPrimarily for existing customersPerformed within expectations over the past year, though varies by collateral type (1) 9/30/10
Slide 107: Credit Quality Review
Credit Quality Review
Slide 108: Credit Quality Trends Overview
Credit Quality Trends Overview 108 108 Excludes loans guaranteed by the U.S. Government NALs divided by total loans and leases(3) NPAs divided by the sum of loans and leases, impaired loans held for sale, net other real estate and other NPAs(4) Criticized assets = commercial criticized loans + consu
Slide 109: Net Charge-offs
(CHART) Net Charge-offs 109 ($MM) ($MM) Consumer Loans Commercial Loans (2) (CHART) (1) Includes $16.4 MM related to $39.8 million of residential mortgages sold and a $4.4 MM Franklin-related recovery (1)
Slide 110: Net Charge-offs ($MM)
Net Charge-offs 110 ($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 Commercial and industrial $59.1 $62.2 $58.1 $75.4 $109.8 Commercial real estate 44.9 63.7 81.7 85.3 258.1 Total commercial 104.0 125.9 139.9 160.7 367.9 Auto loans & leases 7.0 5.6 5.4 8.5 12.9 Home equity 29.2 27.8 44.5 37.9 35.7 Residential mortga
Slide 111: Net Charge-off Ratios
Net Charge-off Ratios (1) 111 4Q10 3Q10 2Q10 1Q10 4Q09 Commercial and industrial 1.85% 2.01% 1.90% 2.45% 3.49% Commercial real estate 2.64 3.60 4.44 4.44 12.21 Total commercial 2.13 2.59 2.85 3.22 7.00 Auto loans & leases 0.51 0.43 0.47 0.80 1.55 Home equity 1.51 1.47 2.36 2.01 1.89 Residential mort
Slide 112: Total Commercial Loan - Delinquencies
Total Commercial Loan - Delinquencies (1) 112 (CHART) (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP 90+ Days 30+ Days
Slide 113: Total Consumer Loan Delinquencies
(CHART) Total Consumer Loan Delinquencies (1) 113 (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP 90+ Days 30+ Days
Slide 114: Consumer Loan Delinquencies
Consumer Loan Delinquencies (1) 114 (CHART) (1) Period end; delinquent but accruing as a % of related outstandings at EOP(2) Excludes GNMA FAS 140 government guaranteed and Franklin in periods prior to 2Q10 (CHART) (2) (2) (2) (2) 90+ Days 30+ Days
Slide 115: Nonaccrual Loans & Nonperforming Assets
(CHART) Nonaccrual Loans & Nonperforming Assets 115 ($MM) (CHART) ($MM) (28)% (45)% (17)% (12)% (7)% (52)% NAL Inflows NALs & NPAs - EOP (18)% 62% (24)% (16)%
Slide 116: Nonaccrual Loans (NALs) and Nonperforming Assets (NPAs)
Nonaccrual Loans (NALs) and Nonperforming Assets (NPAs) 116
Slide 117: Nonperforming Asset Flow Analysis
($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 NPA beginning of period $1,104.9 $1,582.7 $1,918.4 $2,058.1 $2,344.0 Additions / increases 237.8 278.4 171.6 237.9 494.6 Franklin - net impact (5.9) (244.4) (86.7) 15.0 (31.0) Return to accruing status (100.1) (111.2) (78.7) (80.8) (85.9) Loan and lease losses (126.1)
Slide 118: Total Commercial Loans - Criticized Loan Flow Analysis
($MM) 4Q10 3Q10 2Q10 1Q10 4Q09 Criticized beginning-of-period $3,638 $4,106 $4,608 $4,972 $4,855 Additions / increases 290 408 280 306 950 Advances 52 75 79 91 110 Upgrades to "Pass" (383) (391) (409) (273) (134) Paydowns (401) (409) (331) (324) (428) Charge-offs (121) (152) (121) (164) (381) Critic
Slide 119: Accruing Troubled Debt Restructured Loans
Accruing Trouble Debt Restructured Loans 119
Slide 120: Provision, NCO, and ACL
(CHART) Provision, NCO, and ACL 120 ($MM) (1) NCO % annualizedEnd of period (CHART) Allowance for Credit Losses vs.NALs (2) Loan Loss Provision vs.Net Charge-offs (1)
Slide 121: Relative Performance - ALLL / NAL Coverage
(CHART) Relative Performance - ALLL / NAL Coverage 121 (1) Period end
Slide 122: Non-Franklin Credit Metrics Reconciliations
Non-Franklin Credit Metrics Reconciliations
Slide 123: Non-Franklin Credit Metrics Reconciliation
Non-Franklin Credit Metrics Reconciliation 123
Slide 124: Non-Franklin Credit Metrics Reconciliation
Non-Franklin Credit Metrics Reconciliation 124
Slide 125: Non-Franklin Credit Metrics Reconciliation
Non-Franklin Credit Metrics Reconciliation 125
Slide 126: Quarterly Net Charge-off Reconciliation
Quarterly Net Charge-off Reconciliation (1) 126 (1) Annualized
Slide 127: Quarterly Net Charge-off Reconciliation
Quarterly Net Charge-off Reconciliation (1) 127 (1) Annualized
Slide 128: Quarterly Net Charge-off Reconciliation
Quarterly Net Charge-off Reconciliation (1) 128 (1) Annualized
Slide 129: Nonaccrual Loans, Nonperforming Assets & Accruing Restructured Loans
Nonaccrual Loans (NALs), Nonperforming Assets (NPA) & Accruing Restructured Loans (ARLs) 129
Slide 130: Nonaccrual Loans, Nonperforming Assets & Accruing Restructured Loans
Nonaccrual Loans (NALs), Nonperforming Assets (NPA) & Accruing Restructured Loans (ARLs) 130
Slide 131: Nonaccrual Loans, Nonperforming Assets & Accruing Restructured Loans
Nonaccrual Loans (NALs), Nonperforming Assets (NPA) & Accruing Restructured Loans (ARLs) 131
Slide 132: Deposits and Other Funding
Deposits and Other Funding
Slide 133: Deposits and CD Maturities
(CHART) (CHART) Deposits 133 ($B) Avg. Total Deposits - Rate / Mix CD Maturities & Avg. Rate on Maturities Rate 1.75% 1.55% 1.37% 1.21% 1.06%
Slide 134: Deposit Trends Linked Quarter
Deposit Trends 134 Linked Quarter
Slide 135: Deposit Trends Prior-Year Quarter
Deposit Trends 135 Prior-Year Quarter
Slide 136: Total Core Deposit Trends
Total Core Deposit Trends 136
Slide 137: Capital
Capital
Slide 138: Capital Ratios
(CHART) Capital Ratios (1) 138 (1) End-of-period 4Q10 - Raised $920 MM of common equity and repurchased $1.4 billion of TARP related preferred shares
Slide 139: Shareholders' Equity and Key Equity Ratios
(CHART) Shareholders' Equity - Avg. (CHART) Capital 139 Key Equity Ratios - EOP ($B) 4Q10 - Raised $920 MM of common equity and repurchased $1.4 billion of TARP related preferred shares
Slide 140: Franchise
Franchise
Slide 141: Huntington Bancshares Overview
Huntington Bancshares Overview 141 Midwest financial services holding companyFounded - 1866Headquarters - Columbus, OhioTotal assets - $54 Billion Employees (1) - 11,341Franchise: Footprint 6 states: OH, MI, PA, IN, WV, KY 611 branches / 1,387 ATMs Retail and Business Banking 5 Areas - Mortgage bank
Slide 142: The Huntington Franchise
The Huntington Franchise 142 Branches 119ATMs 242Detroit 4%Grand Rapids 10% Branches 343ATMs 748Akron 8%Canton 27%Cincinnati 4%Cleveland 5%Columbus 22%Dayton 6%Toledo 23% Youngstown 20% Branches 50ATMs 80Indianapolis 6% Branches 13ATMs 30 Branches 28ATMs 133Charleston 11% Excludes 9 PFG offices (3 i
Slide 143: A Strong Regional Presence
A Strong Regional Presence 143 Source: SNL Financial, company presentations and filings FDIC deposit data as of June 30, 2010 Deposits - Top 12 MSAs MSA Rank BBs Deposits ShareColumbus, OH 1 69 $9,124 22.2%Cleveland, OH 5 62 3,941 7.8Detroit, MI 8 50 3,607 4.2Toledo, OH 1 42 2,306 22.9Pittsburgh, PA
Slide 144: Leadership Team
Leadership Team Leadership Team Business Segments 144 Insurance,
Slide 145: Senior Leadership Team
Senior Leadership Team 145 (1) Includes related experience outside of banking
Slide 146: Business Segment Summary
Business Segment Summary
Slide 147: Business Segment Loans & Deposits - 4Q10
Business Segment Loans & Deposits - 4Q10 147 Total Deposits - $40.7 B Total Loans - $37.3 B (CHART) (CHART) AFCRE $13.0B 35% Retail & Business Banking $11.7B 31% Treasury / Other - -$1.3 B <1% Commercial Banking $7.4B 20% WGH $4.8B 13% AFCRE $0.7B 2% Treasury / Other $1.1B 3% Retail & Business Banki
Slide 148: Total Loans and Leases - By Business Segment
Total Loans and Leases - By Business Segment 148 148 Avg. Outstandings - $37.3 Billion 4Q10
Slide 149: Total Deposits - By Business Segment
Total Deposits - By Business Segment 149 149 Avg. Balances - $40.7 Billion 4Q10
Slide 150: Business Segment Contribution
Business Segment Contribution 150 ($MM) 2010 2009 2008 Retail & Business Banking $131.0 $(26.5) $257.8 Commercial Banking 38.5 (158.7) 80.3 AFCRE 46.5 (5.88.2) (14.2) WGH 34.8 1.8 43.0 Treas. / Other 61.6 (251.3) (480.8) Unallocated goodwill impairment(1) (2,573.8) Total Net Income $312.3 $3,094.2 $
Slide 151: Business Segment Overview
Business Segment Overview Commercial BankingExecutive - Jim Dunlap11 Region PresidentsMiddle Market Commercial BankingSpecialty BankingLarge CorporateHealth-careNot-for-ProfitEquipment / Technology LeasingInternational ServicesTreasury ManagementCapital MarketsDerivativesForeign ExchangeSecurities T
Slide 152: Commercial Banking Regions
11 Commercial Banking Regions GreaterAkron/Canton Mahoning Valley Central Ohio NW Ohio S. Ohio/KY GreaterCleveland Central Indiana West Michigan East Michigan West Virginia Pittsburgh Jim Dunlap 152
Slide 153: Regional Banking Presidents
Regional Banking Presidents 153
Slide 154: Retail and Business Banking Areas
5 Retail and Business Banking Areas Central Northwest West Northeast East Mary Navarro 154
Slide 155: Retail & Business Banking Executives
Retail & Business Banking Executives 155
Slide 156: Business Segment Overview
Business Segment Overview Wealth Advisors, Government Finance, and Home Lending Executive - Dan BenhaseWealth AdvisorsTrust / Portfolio ManagementPrivate BankingRetail BrokerageGovernment FinancePublic Funds - Treasury Services and LendingCorporate TrustNational SettlementHome LendingMortgage Bankin
Slide 157: Safe Harbor Disclosures
Safe Harbor Disclosures
Slide 158: Basis of Presentation
Basis of Presentation Use of non-GAAP financial measuresThis presentation contains 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,
Slide 159: Basis of Presentation - Significant Items
Basis of Presentation Significant ItemsFrom 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 outsize
Slide 160: Basis of Presentation - Fully-taxable equivalent
Fully-taxable equivalent interest income and net interest marginIncome 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 munic
Slide 161: Forward-looking statements
This press release contains certain forward-looking statements, including certain plans, expectations, goals, projections, and statements, which are subject to numerous assumptions, risks, and uncertainties.Actual results could differ materially from those contained or implied by such statements for
Slide 162: Pi | it
Pi | it v, a) Huntington C Welcome”
Huntington Bancshares — Investor Presentation (February 2011) on 6ix