Quarterly report pursuant to Section 13 or 15(d)

HELD-TO-MATURITY SECURITIES

v3.8.0.1
HELD-TO-MATURITY SECURITIES
9 Months Ended
Sep. 30, 2017
Held-to-maturity Securities [Abstract]  
HELD-TO-MATURITY SECURITIES
HELD-TO-MATURITY SECURITIES
Held-to-maturity securities are debt securities that Huntington has the intent and ability to hold until maturity. The debt securities are carried at amortized cost and adjusted for amortization of premiums and accretion of discounts using the interest method.
During the second quarter of 2017, Huntington transferred $1.0 billion of mortgage-backed and other agency securities from the available-for-sale securities portfolio to the held-to-maturity securities portfolio. The securities were reclassified at fair value at the date of transfer. At the time of the transfer, $13.5 million of unrealized net losses were recognized in OCI. The amounts in OCI will be recognized in earnings over the remaining life of the securities as an offset to the adjustment of yield in a manner consistent with the amortization of the premium on the same transferred securities, resulting in an immaterial impact on net income.

Listed below are the contractual maturities of held-to-maturity securities at September 30, 2017 and December 31, 2016.
 
September 30, 2017
 
December 31, 2016
(dollar amounts in thousands)
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Federal agencies mortgage-backed securities:
 
 
 
 
 
 
 
1 year or less
$

 
$

 
$

 
$

After 1 year through 5 years

 

 

 

After 5 years through 10 years
68,668

 
68,478

 
41,261

 
40,791

After 10 years
8,067,957

 
8,035,777

 
7,157,083

 
7,139,943

Total Federal agencies mortgage-backed securities
8,136,625

 
8,104,255

 
7,198,344

 
7,180,734

Other agencies:
 
 
 
 
 
 
 
1 year or less

 

 

 

After 1 year through 5 years

 

 

 

After 5 years through 10 years
375,580

 
376,393

 
398,341

 
399,452

After 10 years
170,628

 
169,741

 
204,083

 
201,180

Total other agencies
546,208

 
546,134

 
602,424

 
600,632

Total Federal agencies
8,682,833

 
8,650,389

 
7,800,768

 
7,781,366

Municipal securities:
 
 
 
 
 
 
 
1 year or less

 

 

 

After 1 year through 5 years

 

 

 

After 5 years through 10 years

 

 

 

After 10 years
5,566

 
5,416

 
6,171

 
5,902

Total municipal securities
5,566

 
5,416

 
6,171

 
5,902

Total held-to-maturity securities
$
8,688,399

 
$
8,655,805

 
$
7,806,939

 
$
7,787,268



The following table provides amortized cost, gross unrealized gains and losses, and fair value by investment category at September 30, 2017 and December 31, 2016.
 
 
 
Unrealized
 
 
(dollar amounts in thousands)
Amortized
Cost
 
Gross
Gains
 
Gross
Losses
 
Fair Value
September 30, 2017
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
Mortgage-backed securities
$
8,136,625

 
$
14,868

 
$
(47,238
)
 
$
8,104,255

Other agencies
546,208

 
1,697

 
(1,771
)
 
546,134

Total Federal agencies
8,682,833

 
16,565

 
(49,009
)
 
8,650,389

Municipal securities
5,566

 

 
(150
)
 
5,416

Total held-to-maturity securities
$
8,688,399

 
$
16,565

 
$
(49,159
)
 
$
8,655,805

 
 
 
Unrealized
 
 
(dollar amounts in thousands)
Amortized
Cost
 
Gross
Gains
 
Gross
Losses
 
Fair Value
December 31, 2016
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
Mortgage-backed securities
$
7,198,344

 
$
20,883

 
$
(38,493
)
 
$
7,180,734

Other agencies
602,424

 
1,690

 
(3,482
)
 
600,632

Total Federal agencies
7,800,768

 
22,573

 
(41,975
)
 
7,781,366

Municipal securities
6,171

 

 
(269
)
 
5,902

Total held-to-maturity securities
$
7,806,939

 
$
22,573

 
$
(42,244
)
 
$
7,787,268


The following tables provide detail on held-to-maturity securities with unrealized gross losses aggregated by investment category and the length of time the individual securities have been in a continuous loss position, at September 30, 2017 and December 31, 2016.
 
Less than 12 Months
 
Over 12 Months
 
Total
(dollar amounts in thousands)
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
$
5,729,896

 
$
(38,204
)
 
$
301,637

 
$
(9,034
)
 
$
6,031,533

 
$
(47,238
)
Other agencies
248,109

 
(1,771
)
 

 

 
248,109

 
(1,771
)
Total Federal agencies
5,978,005

 
(39,975
)
 
301,637

 
(9,034
)
 
6,279,642

 
(49,009
)
Municipal securities

 

 
5,416

 
(150
)
 
5,416

 
(150
)
Total temporarily impaired securities
$
5,978,005

 
$
(39,975
)
 
$
307,053

 
$
(9,184
)
 
$
6,285,058

 
$
(49,159
)
 
Less than 12 Months
 
Over 12 Months
 
Total
(dollar amounts in thousands)
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
$
2,855,360

 
$
(31,470
)
 
$
186,226

 
$
(7,023
)
 
$
3,041,586

 
$
(38,493
)
Other agencies
413,207

 
(3,482
)
 

 

 
413,207

 
(3,482
)
Total Federal agencies
3,268,567

 
(34,952
)
 
186,226

 
(7,023
)
 
3,454,793

 
(41,975
)
Municipal securities
5,902

 
(269
)
 

 

 
5,902

 
(269
)
Total temporarily impaired securities
$
3,274,469

 
$
(35,221
)
 
$
186,226

 
$
(7,023
)
 
$
3,460,695

 
$
(42,244
)


Security Impairment
Huntington evaluates the held-to-maturity securities portfolio on a quarterly basis for impairment. Impairment exists when the present value of the expected cash flows is not sufficient to recover the entire amortized cost basis at the balance sheet date. Under these circumstances, any impairment would be recognized in earnings. As of September 30, 2017, Management has evaluated held-to-maturity securities with unrealized losses for impairment and concluded no OTTI is required.