Huntington Bancshares Incorporated Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Held to Maturity Securities

Held to Maturity Securities

3 Months Ended

Sep. 30, 2012

Held to Maturity Securities [Abstract]

5. HELD-TO-MATURITY Securities

These 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 2012 third quarter, Huntington transferred $278.7 million of federal agencies, mortgage-backed securities 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, less than $0.1 million of unrealized net gains 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.

Additionally, during the 2012 third quarter, Huntington purchased $734.7 million of federal agencies, mortgage-backed securities which were classified directly into the held-to-maturity portfolio.

Listed below are the contractual maturities (under 1 year, 1-5 years, 6-10 years, and over 10 years) of held-to-maturity securities at September 30, 2012 and December 31, 2011.

				September 30, 2012				December 31, 2011
				Amortized		Fair		Amortized		Fair
(dollar amounts in thousands)				Cost		Value		Cost		Value
	Federal agencies: mortgage-backed securities:
		Under 1 year	$	---	$	---	$	---	$	---
		1-5 years		---		---		---		---
		6-10 years		---		---		---		---
		Over 10 years		1,506,139		1,548,303		640,551		660,186
	Total Federal agencies: mortgage-backed securities			1,506,139		1,548,303		640,551		660,186
	Other agencies:
		Over 10 years		76,011		76,667		---		---
	Total other agencies			76,011		76,667		---		---
Total U.S. Government backed agencies				1,582,150		1,624,970		640,551		660,186
Total held-to-maturity securities			$	1,582,150	$	1,624,970	$	640,551	$	660,186

The following table provides amortized cost, gross unrealized gains and losses, and fair value by investment category at September 30, 2012 and December 31, 2011:

					Unrealized
			Amortized		Gross		Gross		Fair
(dollar amounts in thousands)			Cost		Gains		Losses		Value
September 30, 2012
Federal Agencies:
	Mortgage-backed securities	$	1,506,139	$	42,164	$	---	$	1,548,303
	Other agencies		76,011		656		---		76,667
Total U.S. Government
	backed securities		1,582,150		42,820		---		1,624,970
Total held-to-maturity securities		$	1,582,150	$	42,820	$	---	$	1,624,970

					Unrealized
			Amortized		Gross		Gross		Fair
(dollar amounts in thousands)			Cost		Gains		Losses		Value
December 31, 2011
Federal Agencies:
	Mortgage-backed securities	$	640,551	$	19,652	$	(17)	$	660,186
	Other agencies		---		---		---		---
Total U.S. Government
	backed securities		640,551		19,652		(17)		660,186
Total held-to-maturity securities		$	640,551	$	19,652	$	(17)	$	660,186

Security Impairment

Huntington evaluates the held-to-maturity securities portfolio on a quarterly basis for impairment. Impairment would exist 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 OTTI would be recognized in earnings. As of September 30, 2012, Management has evaluated all held-to-maturity securities and concluded no OTTI existed in the portfolio.