Annual report pursuant to Section 13 and 15(d)

Held to Maturity Securities

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Held to Maturity Securities
 12 Months Ended
Dec. 31, 2012
Held to Maturity Securities [Abstract]  
HELD-TO-MATURITY SECURITIES

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 2012 and 2011, Huntington transferred $278.7 million and $469.1 million, respectively of federal agencies, mortgage-backed securities and other agency securities from the available-for-sale securities portfolio to the held-to-maturity securities portfolio. At the time of the transfer, $0.1 million and $0.5 million, respectively 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 2012 and 2011, Huntington purchased additional federal agencies, mortgage-backed securities and municipal 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 December 31, 2012 and 2011:

 

        December 31, 2012     December 31, 2011
        Amortized     Fair     Amortized      
(dollar amounts in thousands)   Cost     Value     Cost     Fair Value
  Federal agencies: mortgage-backed securities:                      
    Under 1 year $ ---   $ ---   $ ---   $ ---
    1-5 years   ---     ---     ---     ---
    6-10 years   24,901     24,739     ---     ---
    Over 10 years   1,624,483     1,672,702     640,551     660,186
  Total Federal agencies: mortgage-backed securities 1,649,384     1,697,441     640,551     660,186
  Other agencies:                      
    Under 1 year   ---     ---     ---     ---
    1-5 years   ---     ---     ---     ---
    6-10 years   15,108     15,338     ---     ---
    Over 10 years   69,399     71,341     ---     ---
  Total other agencies   84,507     86,679     ---     ---
Total U.S. Government backed agencies   1,733,891     1,784,120     640,551     660,186
Municipal securities:                      
  Under 1 year   ---     ---     ---     ---
  1-5 years   ---     ---     ---     ---
  6-10 years ---     ---     ---     ---
  Over 10 years   9,985     9,985     ---     ---
Total municipal securities   9,985     9,985     ---     ---
Total held-to-maturity securities $ 1,743,876   $ 1,794,105   $ 640,551   $ 660,186
                           

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

            Unrealized      
      Amortized     Gross     Gross     Fair
(dollar amounts in thousands)   Cost     Gains     Losses     Value
December 31, 2012                      
Federal Agencies:                      
  Mortgage-backed securities $ 1,649,384   $ 48,219   $ (162)   $ 1,697,441
  Other agencies   84,507     2,172     ---     86,679
Total U.S. Government                      
  backed securities   1,733,891     50,391     (162)     1,784,120
Municipal securities   9,985     ---     ---     9,985
Total held-to-maturity securities $ 1,743,876   $ 50,391   $ (162)   $ 1,794,105
                         
            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
Municipal securities   ---     ---     ---     ---
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 impairment would be recognized in earnings. As of December 31, 2012, Management has evaluated held-to-maturity securities with unrealized losses for impairment and concluded no OTTI is required.