| OTHER COMPREHENSIVE INCOME |
OTHER COMPREHENSIVE INCOME
The components of Huntington's OCI for the three-month and nine-month periods ended September 30, 2019 and 2018, were as follows:
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Three Months Ended
September 30, 2019 |
|
Tax (expense) |
(dollar amounts in millions) |
Pretax |
|
Benefit |
|
After-tax |
Unrealized gains (losses) on available-for-sale securities arising during the period |
$ |
81 |
|
|
$ |
(18 |
) |
|
$ |
63 |
|
Less: Reclassification adjustment for realized net losses (gains) included in net income |
8 |
|
|
(2 |
) |
|
6 |
|
Net change in unrealized holding gains (losses) on available-for-sale securities |
89 |
|
|
(20 |
) |
|
69 |
|
Net change in fair value on cash flow hedges |
36 |
|
|
(8 |
) |
|
28 |
|
Net change in pension and other post-retirement obligations |
1 |
|
|
— |
|
|
1 |
|
Total other comprehensive income (loss) |
$ |
126 |
|
|
$ |
(28 |
) |
|
$ |
98 |
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Three Months Ended
September 30, 2018 |
|
Tax (expense) |
(dollar amounts in millions) |
Pretax |
|
Benefit |
|
After-tax |
Unrealized gains (losses) on available-for-sale securities arising during the period |
$ |
(82 |
) |
|
$ |
18 |
|
|
$ |
(64 |
) |
Less: Reclassification adjustment for realized net losses (gains) included in net income |
3 |
|
|
(1 |
) |
|
2 |
|
Net change in unrealized gains (losses) on available-for-sale securities |
(79 |
) |
|
17 |
|
|
(62 |
) |
Net change in pension and other post-retirement obligations |
2 |
|
|
(1 |
) |
|
1 |
|
Total other comprehensive income (loss) |
$ |
(77 |
) |
|
$ |
16 |
|
|
$ |
(61 |
) |
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Nine Months Ended
September 30, 2019 |
|
Tax (expense) |
(dollar amounts in millions) |
Pretax |
|
Benefit |
|
After-tax |
Unrealized holding gains (losses) on available-for-sale securities arising during the period |
$ |
428 |
|
|
$ |
(95 |
) |
|
$ |
333 |
|
Less: Reclassification adjustment for realized net losses (gains) included in net income |
21 |
|
|
(5 |
) |
|
16 |
|
Net change in unrealized holding gains (losses) on available-for-sale securities |
449 |
|
|
(100 |
) |
|
349 |
|
Net change in fair value on cash flow hedges |
104 |
|
|
(22 |
) |
|
82 |
|
Net change in pension and other post-retirement obligations |
3 |
|
|
— |
|
|
3 |
|
Total other comprehensive income (loss) |
$ |
556 |
|
|
$ |
(122 |
) |
|
$ |
434 |
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Nine Months Ended
September 30, 2018 |
|
Tax (expense) |
(dollar amounts in millions) |
Pretax |
|
Benefit |
|
After-tax |
Unrealized holding gains (losses) on available-for-sale securities arising during the period |
$ |
(359 |
) |
|
$ |
78 |
|
|
$ |
(281 |
) |
Less: Reclassification adjustment for realized net losses (gains) included in net income |
21 |
|
|
(4 |
) |
|
17 |
|
Net change in unrealized holding gains (losses) on available-for-sale securities |
(338 |
) |
|
74 |
|
|
(264 |
) |
Net change in pension and other post-retirement obligations |
4 |
|
|
(1 |
) |
|
3 |
|
Total other comprehensive income (loss) |
$ |
(334 |
) |
|
$ |
73 |
|
|
$ |
(261 |
) |
Activity in accumulated OCI for the three and nine month periods ended September 30, 2019 and 2018, were as follows:
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|
(dollar amounts in millions) |
Unrealized gains (losses) on
debt securities (1)
|
|
Change in fair value related to cash flow hedges |
|
Unrealized gains
(losses) for
pension and
other post-
retirement
obligations
|
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Total |
Three Months Ended September 30, 2019 |
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Balance, beginning of period |
$ |
(83 |
) |
|
$ |
54 |
|
|
$ |
(244 |
) |
|
$ |
(273 |
) |
Other comprehensive income before reclassifications |
63 |
|
|
28 |
|
|
— |
|
|
91 |
|
Amounts reclassified from accumulated OCI to earnings |
6 |
|
|
— |
|
|
1 |
|
|
7 |
|
Period change |
69 |
|
|
28 |
|
|
1 |
|
|
98 |
|
Balance, end of period |
$ |
(14 |
) |
|
$ |
82 |
|
|
$ |
(243 |
) |
|
$ |
(175 |
) |
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Three Months Ended September 30, 2018 |
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Balance, beginning of period |
$ |
(482 |
) |
|
$ |
— |
|
|
$ |
(248 |
) |
|
$ |
(730 |
) |
Other comprehensive income before reclassifications |
(64 |
) |
|
— |
|
|
— |
|
|
(64 |
) |
Amounts reclassified from accumulated OCI to earnings |
2 |
|
|
— |
|
|
1 |
|
|
3 |
|
Period change |
(62 |
) |
|
— |
|
|
1 |
|
|
(61 |
) |
Other |
1 |
|
|
|
|
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|
1 |
|
Balance, end of period |
$ |
(543 |
) |
|
$ |
— |
|
|
$ |
(247 |
) |
|
$ |
(790 |
) |
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|
(dollar amounts in millions) |
Unrealized gains (losses) on
debt securities (1)
|
|
Change in fair value related to cash flow hedges |
|
Unrealized gains
(losses) for
pension and
other post-
retirement
obligations
|
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Total |
Nine Months Ended September 30, 2019 |
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Balance, beginning of period |
$ |
(363 |
) |
|
$ |
— |
|
|
$ |
(246 |
) |
|
$ |
(609 |
) |
Other comprehensive income before reclassifications |
333 |
|
|
82 |
|
|
— |
|
|
415 |
|
Amounts reclassified from accumulated OCI to earnings |
16 |
|
|
— |
|
|
3 |
|
|
19 |
|
Period change |
349 |
|
|
82 |
|
|
3 |
|
|
434 |
|
Balance, end of period |
$ |
(14 |
) |
|
$ |
82 |
|
|
$ |
(243 |
) |
|
$ |
(175 |
) |
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Nine Months Ended September 30, 2018 |
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Balance, beginning of period |
$ |
(278 |
) |
|
$ |
— |
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|
$ |
(250 |
) |
|
$ |
(528 |
) |
Cumulative-effect adjustments (ASU 2016-01) |
(1 |
) |
|
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|
(1 |
) |
Other comprehensive income before reclassifications |
(281 |
) |
|
— |
|
|
— |
|
|
(281 |
) |
Amounts reclassified from accumulated OCI to earnings |
17 |
|
|
— |
|
|
3 |
|
|
20 |
|
Period change |
(264 |
) |
|
— |
|
|
3 |
|
|
(261 |
) |
Balance, end of period |
$ |
(543 |
) |
|
$ |
— |
|
|
$ |
(247 |
) |
|
$ |
(790 |
) |
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(1) |
AOCI amounts at September 30, 2019, June 30, 2019 and September 30, 2018 include $126 million, $131 million and $141 million, respectively, of net unrealized losses on securities transferred from the available-for-sale securities portfolio to the held-to-maturity securities portfolio. The net unrealized losses will be recognized in earnings over the remaining life of the security using the effective interest method.
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The following table presents the reclassification adjustments out of accumulated OCI included in net income and the impacted line items as listed on the Unaudited Condensed Consolidated Statements of Income for the three-month and nine-month periods ended September 30, 2019 and 2018:
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Reclassifications out of accumulated OCI |
Accumulated OCI components |
Amounts reclassified from accumulated OCI |
|
Location of net gain (loss) reclassified from
accumulated OCI into earnings
|
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Three Months Ended |
|
|
(dollar amounts in millions) |
September 30, 2019 |
|
September 30, 2018 |
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Gains (losses) on debt securities: |
|
|
|
|
|
Amortization of unrealized gains (losses) |
$ |
(4 |
) |
|
$ |
(3 |
) |
|
Interest income - held-to-maturity securities - taxable |
Realized gain (loss) on sale of securities |
(4 |
) |
|
— |
|
|
Noninterest income - net gains (losses) on sale of securities |
Total before tax |
(8 |
) |
|
(3 |
) |
|
|
Tax (expense) benefit |
2 |
|
|
1 |
|
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|
Net of tax |
$ |
(6 |
) |
|
$ |
(2 |
) |
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Amortization of defined benefit pension and post-retirement items: |
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|
Actuarial gains (losses) |
$ |
(1 |
) |
|
$ |
(2 |
) |
|
Noninterest income |
Net periodic benefit costs |
— |
|
|
— |
|
|
Noninterest income |
Total before tax |
(1 |
) |
|
(2 |
) |
|
|
Tax (expense) benefit |
— |
|
|
1 |
|
|
|
Net of tax |
$ |
(1 |
) |
|
$ |
(1 |
) |
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Reclassifications out of accumulated OCI |
Accumulated OCI components |
Amounts reclassified from accumulated OCI |
|
Location of net gain (loss) reclassified from accumulated OCI into earnings |
|
Nine Months Ended |
|
|
(dollar amounts in millions) |
September 30, 2019 |
|
September 30, 2018 |
|
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Gains (losses) on debt securities: |
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|
|
|
Amortization of unrealized gains (losses) |
$ |
(11 |
) |
|
$ |
(9 |
) |
|
Interest income - held-to-maturity securities - taxable |
Realized gain (loss) on sale of securities |
(10 |
) |
|
(12 |
) |
|
Noninterest income - net gains (losses) on sale of securities |
Total before tax |
(21 |
) |
|
(21 |
) |
|
|
Tax (expense) benefit |
5 |
|
|
4 |
|
|
|
Net of tax |
$ |
(16 |
) |
|
$ |
(17 |
) |
|
|
Amortization of defined benefit pension and post-retirement items: |
Actuarial gains (losses) |
$ |
(4 |
) |
|
$ |
(6 |
) |
|
Noninterest income |
Net periodic benefit costs |
1 |
|
|
2 |
|
|
Noninterest income |
Total before tax |
(3 |
) |
|
(4 |
) |
|
|
Tax (expense) benefit |
— |
|
|
1 |
|
|
|
Net of tax |
$ |
(3 |
) |
|
$ |
(3 |
) |
|
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|