EXHIBIT 99.1
FOR IMMEDIATE RELEASE
JANUARY 6, 2003
CONTACTS:
Analysts Media
Jay Gould (614) 480-4060 Jeri Grier (614) 480-5413
Susan Stuart (614) 480-3878 Karen Del Toro (614) 480-3077
HUNTINGTON ANNOUNCES FOURTH QUARTER CREDIT ACTIONS
- COMPLETED SALE OF $47 MILLION OF NONPERFORMING LOANS
- $51 MILLION INCREMENTAL CHARGE-OFFS INCLUDING ONE $30 MILLION HEALTH
CARE CREDIT
- NO NET IMPACT ON 2002 FOURTH QUARTER EARNINGS
- STRONG 1.76% LOAN LOSS RESERVE RATIO AT DECEMBER 31, 2002
- IMPROVED 269% NONPERFORMING LOAN COVERAGE RATIO AT DECEMBER 31, 2002
- 9:00A.M. CONFERENCE CALL TOMORROW MORNING, JANUARY 7, 2003
COLUMBUS, OHIO - Huntington Bancshares Incorporated (NASDAQ: HBAN;
www.huntington.com) today announced the following 2002 fourth quarter credit
actions:
- - $47 million sale of nonperforming loans completed with $21 million of
incremental charge-offs, and
- - $30 million charge-off, or 100% of the credit exposure, associated with
one customer in the health care finance business that was put on
nonperforming loan status in November 2002, as previously disclosed.
Year end credit quality ratios will be strong. Compared to ratios at
September 30, 2002, this includes:
- - 0.65% ratio of nonperforming assets to loans and other real estate owned,
down significantly from 1.05%, and 10 basis points below the 0.75% third
quarter median of 19 peer banks (1),
- - 269% nonperforming asset coverage ratio (loan loss reserve as a percent of
nonperforming assets), up significantly from 191%, and 92 percentage
points higher than the 177% third quarter peer median (1), and
- - 1.76% loan loss reserve to loan ratio, down from 2.00%, but 29 basis
points higher than the 1.47% third quarter peer median (1).
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"An ongoing objective over the past 18 months has been to build a fortress
balance sheet and foster a strong credit culture," said Tom Hoaglin, chairman,
president and chief executive officer. "In 2001 as nonperforming loans
increased, reserves were strengthened accordingly from 1.45% in March 2001 to
2.05% at year end 2001. Also, earlier last year we strengthened our credit
workout group, whose mission is the early identification and resolution of
problem credits. Late in the 2002 fourth quarter, this group identified an
economically attractive opportunity for the sale of $47 million of nonperforming
commercial loans. We believe it is in our shareholders' best interest to affect
the sale of these loans."
"These actions will have no net earnings impact on fourth quarter earnings
as existing loan loss reserves are sufficient to absorb the related
charge-offs," Hoaglin noted.
"As a result of these actions, our nonperforming asset coverage ratio is
significantly strengthened and among the highest of our peers, and our loan loss
reserve ratio remains strong and well above peer averages," he continued. "Since
early 2001 we have continually taken steps to improve our credit risk profile
including strengthened underwriting and workout disciplines, deliberately
reduced our shared national credit exposure by $500 million, and originated much
higher credit quality auto loans and leases. Further, about 70% of our loan
growth last year represented low credit risk residential real estate and home
equity loans. These changes, together with our strong capital position and a
2003 outlook that anticipates modestly improving credit quality, provides us
comfort that our 1.76% reserve level is strong."
The following table highlights the impact of the 2002 fourth quarter
credit actions on related credit quality performance results:
($ in millions) 3Q02 4Q02
Actuals Before After Change vs.
Actions Actions 3Q02
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Nonperforming assets (NPA) - $EOP $ 214 $ 214 $ 137 $ (77)
Nonperforming assets - % 1.05% 1.02% 0.65% (40) bp
Net charge-offs - $ $ 44 $ 44 $ 95 +$51
Net charge-offs - % annualized 0.87% 0.84% 1.84% + 97 bp
Loan loss reserve / loans ratio -EOP 2.00% 2.00% 1.76% (24) bp
Loan loss reserve / NPAs - EOP 191% 196% 269% + 78 pct. pts
EOP = end of period
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(1) Peer average consists of the following 19 regional bank holding companies:
AmSouth, BB& T, Banknorth Group, Charter One, Comerica, Compass Bancshares,
Fifth Third, First Tennessee, Hibernia, KeyCorp, M&T Bank, Marshall & Ilsley,
National Commerce, National City Corp., Regions Financial, South Trust, Union
Banc Cal, Union Planters, and Zions.
CONFERENCE CALL / WEBCAST INFORMATION
Huntington's senior management will host an earnings conference call tomorrow
morning, January 7, at 9:00a.m. EST. The call may be accessed via a live
Internet webcast at www.huntington-ir.com or through a dial-in telephone number
at (800) 521-5499. Slides will be available at www.huntington-ir.com just prior
to 8:00a.m. EST, January 7 for review during the call. A replay of the webcast
will be archived in the Investor Relations section of Huntington's web site
www.huntington.com. A telephone replay will be available two hours after the
completion of the call through January 14, 2003, at (888) 211-2648; conference
ID 2862627. The conference call transcript and slides will be filed with the
Securities and Exchange Commission on Form 8-K.
FORWARD-LOOKING STATEMENT
This press release contains certain forward-looking statements, including
certain plans, expectations, goals, and projections, which are subject to
numerous assumptions, risks, and uncertainties. A number of factors, including
but not limited to those set forth under the heading "Business Risks" included
in Item 1 of Huntington's Annual Report on Form 10-K for the year ended December
31, 2001, and other factors described from time to time in Huntington's other
filings with the Securities and Exchange Commission, could cause actual
conditions, events, or results to differ significantly from those described in
the forward-looking statements. All forward-looking statements included in this
news release are based on information available at the time of the release.
Huntington assumes no obligation to update any forward-looking statement.
ABOUT HUNTINGTON
Huntington Bancshares Incorporated is a $27 billion regional bank holding
company headquartered in Columbus, Ohio. Through its affiliated companies,
Huntington has more than 136 years of serving the financial needs of its
customers. Huntington provides innovative retail and commercial financial
products and services through more than 300 regional banking offices in Indiana,
Kentucky, Michigan, Ohio and West Virginia. Huntington also offers retail and
commercial financial services online at www.huntington.com; through its
technologically advanced, 24-hour telephone bank; and through its network of
more than 900 ATMs. Selected financial service activities are also conducted in
other states including: Dealer Sales offices in Florida, Georgia, Tennessee,
Pennsylvania and Arizona; Private Financial Group offices in Florida; and
Mortgage Banking offices in Florida, Maryland and New Jersey. International
banking services are made available through the headquarters office in Columbus
and additional offices located in the Cayman Islands and Hong Kong.
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