Annual report pursuant to Section 13 and 15(d)

Segment Reporting

Segment Reporting
12 Months Ended
Dec. 31, 2013
Segment Reporting [Abstract]  



We have four major business segments: Retail and Business Banking, Regional and Commercial Banking, Automobile Finance and Commercial Real Estate, and Wealth Advisors, Government Finance, and Home Lending. A Treasury / Other function includes our insurance business and other unallocated assets, liabilities, revenue, and expense.


Segment results are determined based upon the Company's management reporting system, which assigns balance sheet and income statement items to each of the business segments. The process is designed around the Company's organizational and management structure and, accordingly, the results derived are not necessarily comparable with similar information published by other financial institutions. A description of each segment and table of financial results as of December 31, 2013, is presented below.


Retail and Business Banking: The Retail and Business Banking segment provides a wide array of financial products and services to consumer and small business customers including but not limited to checking accounts, savings accounts, money market accounts, certificates of deposit, consumer loans, and small business loans and leases. Other financial services available to consumer and small business customers include investments, insurance services, interest rate risk protection products, foreign exchange hedging, and treasury management services. Huntington serves customers primarily through our network of traditional branches in Ohio, Michigan, Pennsylvania, Indiana, West Virginia, and Kentucky. Huntington also has branches located in grocery stores in Ohio and Michigan. In addition to our extensive branch network, customers can access Huntington through online banking, mobile banking, telephone banking and ATMs.


Huntington established a “Fair Play” banking philosophy and built a reputation for meeting the banking needs of consumers in a manner which makes them feel supported and appreciated. Huntington believes customers are recognizing this and other efforts as key differentiators and it is earning us more customers and deeper relationships.


Business Banking is a dynamic and growing part of our business and we are committed to being the bank of choice for small businesses in our markets. Business Banking is defined as companies with revenues up to $25 million and consists of approximately 163,000 businesses.  Huntington continues to develop products and services that are designed specifically to meet the needs of small business. Huntington continues to look for ways to help companies find solutions to their capital needs.


Regional and Commercial Banking: This segment provides a wide array of products and services to the middle market and large corporate customers base located primarily within our eleven regional commercial banking markets. Products and services are delivered through a relationship banking model and include commercial lending, as well as depository and liquidity management products. Dedicated teams collaborate with our relationship bankers to deliver complex and customized treasury management solutions, equipment leasing, international services, capital markets services such as interest rate risk protection products, foreign exchange hedging and sales, trading of securities, mezzanine investment capabilities, and employee benefit programs (insurance, 401(k)). The Commercial Banking team specializes in serving a number of industry segments such as not-for-profit organizations, health-care entities, and large publicly traded companies.


Automobile Finance and Commercial Real Estate: This segment provides lending and other banking products and services to customers outside of our normal retail and commercial banking segments. Our products and services include financing for the purchase of automobiles by customers at automotive dealerships, financing the acquisition of new and used vehicle inventory of automotive dealerships, and financing for land, buildings, and other commercial real estate owned or constructed by real estate developers, automobile dealerships, or other customers with real estate project financing needs. Products and services are delivered through highly specialized relationship-focused bankers and product partners. Huntington creates well-defined relationship plans which identify needs where solutions are developed and customer commitments are obtained.


The Automotive Finance team services automobile dealerships, its owners, and consumers buying automobiles through these dealerships. Huntington has provided new and used automobile financing and dealer services throughout the Midwest since the early 1950s. This consistency in the market and our focus on working with strong dealerships, has allowed us to expand into selected markets outside of the Midwest and to actively deepen relationships while building a strong reputation.


The Commercial Real Estate team serves real estate developers, REITs, and other customers with lending needs that are secured by commercial properties. Most of our customers are located within our footprint.


Wealth Advisors, Government Finance, and Home Lending: This segment consists of our wealth management, government banking, and home lending businesses. In wealth management, Huntington provides financial services to high net worth clients in our primary banking markets and Florida. Huntington provides these services through a unified sales team, which consists of private bankers, trust officers, and investment advisors. Aligned with the eleven regional commercial banking markets, this coordinated service model delivers products and services directly and through the other segment product partners. A fundamental point of differentiation is our commitment to be in the market, working closely with clients and their other advisors to identify needs, offer solutions and provide ongoing advice in an optimal client relationship.


The Government Finance Group provides financial products and services to government and other public sector entities in our primary banking markets. A locally based team of relationship managers works with clients to meet their trust, lending, and treasury management needs.


Home Lending originates and services consumer loans and mortgages for customers who are generally located in our primary banking markets. Consumer and mortgage lending products are primarily distributed through the Retail and Business Banking segment, as well as through commissioned loan originators. Closely aligned, our Community Development group serves an important role as it focuses on delivering on our commitment to the communities Huntington serves.


The segment also includes the related businesses of investment management, investment servicing, custody, corporate trust, and retirement plan services. Huntington Asset Advisors provides investment management services through a variety of internal and external channels, including advising the Huntington Funds, our proprietary family of mutual funds and Huntington Strategy Shares, our actively-managed exchange-traded funds. Huntington Asset Services offers administrative and operational support to fund complexes, including fund accounting, transfer agency, administration, and distribution services. Our retirement plan services business offers fully bundled and third party distribution of a variety of qualified and non-qualified plan solutions.


Treasury / Other function includes our insurance brokerage business, which specializes in commercial property and casualty, employee benefits, personal lines, life and disability and specialty lines of insurance. Huntington also provides brokerage and agency services for residential and commercial title insurance and excess and surplus product lines of insurance. As an agent and broker we do not assume underwriting risks; instead we provide our customers with quality, noninvestment insurance contracts. The Treasury / Other function also includes technology and operations, other unallocated assets, liabilities, revenue, and expense.


Listed below is certain operating basis financial information reconciled to Huntington's 2013, 2012, and 2011 reported results by business segment:


      Retail &   Regional &                  
Income Statements   Business   Commercial           Treasury / Huntington
(dollar amounts in thousands)   Banking   Banking     AFCRE   WGH Other Consolidated
Net interest income $ 813,871 $ 276,480   $ 356,488 $ 172,033 $ 85,736 $ 1,704,608
Provision for credit losses   137,898   16,982     (71,312)   6,477   ---   90,045
Noninterest income   392,797   140,639     34,099   299,588   130,872   997,995
Noninterest expense   964,316   219,029     149,744   365,531   59,383   1,758,003
Provision (benefit) for income taxes   36,559   63,388     109,254   34,865   (28,252)   215,814
Net income $ 67,895 $ 117,720   $ 202,901 $ 64,748 $ 185,477 $ 638,741
Net interest income $ 870,146 $ 273,869   $ 356,442 $ 192,681 $ 17,386 $ 1,710,524
Provision for credit losses   136,061   10,689     (22,962)   23,600   ---   147,388
Noninterest income   385,498   138,454     84,619   351,057   138,229   1,097,857
Noninterest expense   982,378   203,000     154,480   376,239   119,779   1,835,876
Provision (benefit) for income taxes   48,022   69,522     108,340   50,365   (92,154)   184,095
Net income $ 89,183 $ 129,112   $ 201,203 $ 93,534 $ 127,990 $ 641,022
Net interest income $ 932,385 $ 244,392   $ 364,449 $ 199,536 $ (111,592) $ 1,629,170
Provision for credit losses   120,018   11,013     (8,939)   51,967   ---   174,059
Noninterest income   405,265   127,315     77,623   248,764   121,656   980,623
Noninterest expense,   947,794   191,701     164,626   356,513   67,866   1,728,500
Provision (benefit) for income taxes   94,443   59,147     100,234   13,937   (103,140)   164,621
Net income $ 175,395 $ 109,846   $ 186,151 $ 25,883 $ 45,338 $ 542,613

    Assets at     Deposits at
    December 31,     December 31,
(dollar amounts in thousands)   2013     2012     2013     2012
Retail and Business Banking $ 14,471,854   $ 14,362,630   $ 28,313,803   $ 28,367,264
Regional and Commercial Banking   12,268,717     11,540,966     6,941,649     5,862,858
AFCRE   14,103,800     12,085,128     1,163,637     995,035
WGH   7,590,271     7,570,256     9,657,174     9,507,785
Treasury / Other   11,041,702     10,594,205     1,430,455     1,519,741
Total $ 59,476,344   $ 56,153,185   $ 47,506,718   $ 46,252,683