Annual report pursuant to Section 13 and 15(d)

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

v3.19.3.a.u2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables)
12 Months Ended
Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Gross notional values of derivatives used in asset and liability management activities
The following table presents the gross notional values of derivatives used in Huntington’s asset and liability management activities at December 31, 2019 and December 31, 2018, identified by the underlying interest rate-sensitive instruments:
 
December 31, 2019
(dollar amounts in millions)
Fair Value Hedges
 
Cash Flow Hedges
 
Total
Instruments associated with:
 
 
 
 
 
Loans
$

 
$
18,375

 
$
18,375

Investment securities

 
12

 
12

Long-term debt
7,540

 

 
7,540

Total notional value at December 31, 2019
$
7,540

 
$
18,387

 
$
25,927

 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2018
(dollar amounts in millions)
Fair Value Hedges
 
Cash Flow Hedges
 
Total
Instruments associated with:
 
 
 
 
 
Investment securities
$

 
$
12

 
$
12

Long-term debt
4,865

 

 
4,865

Total notional value at December 31, 2018
$
4,865

 
$
12

 
$
4,877


Additional information about the interest rate swaps used in asset and liability management activities
The following table presents additional information about the interest rate swaps and floors used in Huntington’s asset and liability management activities at December 31, 2019 and December 31, 2018:
 
December 31, 2019
 
 
 
Average Maturity (years)
 
 
 
Weighted-Average Rate
(dollar amounts in millions)
Notional Value
 
 
Fair Value
 
Receive
 
Pay
Asset conversion swaps
 
 
 
 
 
 
 
 
 
Receive fixed—generic
$
8,637

 
3.3

 
$
23

 
1.66
%
 
1.06
%
Liability conversion swaps
 
 
 
 
 
 
 
 
 
Receive fixed—generic
7,540

 
2.3

 
151

 
2.20

 
1.79

Total swap portfolio at December 31, 2019
$
16,177

 
2.9

 
$
174

 
1.91
%
 
1.40
%
 
 
 
 
 
 
 
 
 
 
 
December 31, 2019
 
 
 
 
 
 
 
 
(dollar amounts in millions)
Notional Value
 
Average Maturity (years)
 
Fair Value
Interest rate floors
 
 
 
 
 
 
 
 
 
Designated interest rate floors
$
9,750
 
 
1.6
 
 
$
46

Total floors portfolio at December 31, 2019
$
9,750
 
 
1.6
 
 
$
46

 
 
 
 
 
 
 
 
 
 
 
December 31, 2018
 
 
 
Average Maturity (years)
 
 
 
Weighted-Average Rate
(dollar amounts in millions)
Notional Value
 
 
Fair Value
 
Receive
 
Pay
Asset conversion swaps
 
 
 
 
 
 
 
 
 
Receive fixed—generic
$
12

 
1.2

 
$

 
2.20
%
 
2.46
%
Liability conversion swaps
 
 
 
 
 
 
 
 
 
Receive fixed—generic
4,865

 
2.6

 
2

 
2.24
%
 
2.54
%
Total swap portfolio at December 31, 2018
$
4,877

 
2.6

 
$
2

 
2.24
%
 
2.54
%

Asset and liability derivatives included in accrued income and other assets
 
December 31, 2019
December 31, 2018
(dollar amounts in millions)
Asset
 
Liability
 
Asset
 
Liability
Derivatives designated as Hedging Instruments
 
 
 
 
 
 
 
Interest rate contracts
$
256

 
$
36

 
$
44

 
$
42

Derivatives not designated as Hedging Instruments
 
 
 
 
 
 
 
Interest rate contracts
420

 
314

 
261

 
165

Foreign exchange contracts
19

 
18

 
23

 
19

Commodities contracts
155

 
152

 
172

 
168

Equity contracts
6

 
1

 

 
10

Total Contracts
$
856

 
$
521

 
$
500

 
$
404


Increase or (decrease) to interest expense for derivatives designated as fair value hedges
The following table presents the change in fair value for derivatives designated as fair value hedges as well as the offsetting change in fair value on the hedged item for the years ended December 31, 2019 and 2018:
 
Year Ended December 31,
(dollar amounts in millions)
2019
 
2018
 
2017
Interest rate contracts
 
 
 
 
 
Change in fair value of interest rate swaps hedging long-term debt (1)
$
127

 
$
112

 
$
(53
)
Change in fair value of hedged long term debt (1)
(125
)
 
(104
)
 
54

(1)
Recognized in Interest expense - long-term debt in the Consolidated Statements of Income.
Gains and (losses) recognized in other comprehensive income (loss) (OCI) for derivatives designated as effective cash flow hedges
 
 
Location of Gain or (Loss) Recognized in Income on Derivative
 
 
 
 
Year Ended December 31,
(dollar amounts in millions)
 
 
2019
 
2018
Interest rate contracts:
 
 
 
 
 
 
Customer
 
Capital markets fees
 
$
49

 
$
41

Mortgage Banking
 
Mortgage banking income
 
37

 
(19
)
Interest rate floors
 
Other noninterest income
 
4

 

Foreign exchange contracts
 
Capital markets fees
 
28

 
27

Commodities contracts
 
Capital markets fees
 
(2
)
 
6

Equity contracts
 
Other noninterest expense
 
(4
)
 
4

Total
 
 
 
$
112

 
$
59


Offsetting of financial assets and derivatives assets
The following tables present the gross amounts of these assets and liabilities with any offsets to arrive at the net amounts recognized in the Consolidated Balance Sheets at December 31, 2019 and December 31, 2018:
Offsetting of Financial Assets and Derivative Assets
 
 
 
 
Gross amounts
offset in the
consolidated
balance sheets
 
Net amounts of
assets
presented in
the
consolidated
balance sheets
 
Gross amounts not offset in the consolidated balance sheets
 
 
(dollar amounts in millions)
 
Gross amounts
of recognized
assets
 
 
 
Financial
instruments
 
Cash collateral
received
 
Net amount
December 31, 2019
Derivatives
$
856

 
$
(404
)
 
$
452

 
$
(65
)
 
$
(29
)
 
$
358

December 31, 2018
Derivatives
500

 
(291
)
 
209

 
(4
)
 
(53
)
 
152


Offsetting of financial liabilities and derivative liabilities
Offsetting of Financial Liabilities and Derivative Liabilities
 
 
 
 
Gross amounts
offset in the
consolidated
balance sheets
 
Net amounts of
liabilities
presented in
the
consolidated
balance sheets
 
Gross amounts not offset in the consolidated balance sheets
 
 
(dollar amounts in millions)
 
Gross amounts
of recognized
liabilities
 
 
 
Financial
instruments
 
Cash collateral
delivered
 
Net amount
December 31, 2019
Derivatives
$
521

 
$
(417
)
 
$
104

 
$

 
$
(75
)
 
$
29

December 31, 2018
Derivatives
404

 
(217
)
 
187

 

 
(12
)
 
175


Schedule of Fair Value Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block]
 
Carrying Amount of the Hedged Liabilities
 
Cumulative Amount of Fair Value Hedging Adjustment To Hedged Liabilities
(dollar amounts in millions)
December 31, 2019
 
December 31, 2018
 
December 31, 2019
 
December 31, 2018
Long-term debt
$
7,578

 
$
4,845

 
$
114

 
$
(12
)
The cumulative amount of fair value hedging adjustments remaining for any hedged assets and liabilities for which hedge accounting has been discontinued is $(93) million at December 31, 2019 and $(127) million at December 31, 2018.