Quarterly report pursuant to Section 13 or 15(d)

FAIR VALUES OF ASSETS AND LIABILITIES (Tables)

v3.22.2
FAIR VALUES OF ASSETS AND LIABILITIES (Tables)
 6 Months Ended
Jun. 30, 2022
Fair Value Disclosures [Abstract]  
Assets and liabilities measured at fair value on a recurring basis
Assets and Liabilities measured at fair value on a recurring basis
Fair Value Measurements at Reporting Date Using Netting Adjustments (1) June 30, 2022
(dollar amounts in millions) Level 1 Level 2 Level 3
Assets
Trading account securities:
Municipal securities $ —  $ 34  $ —  $ —  $ 34 
Available-for-sale securities:
U.S. Treasury securities 5  —  —  —  5 
Residential CMOs —  3,001  —  —  3,001 
Residential MBS —  12,947  —  —  12,947 
Commercial MBS —  1,982  —  —  1,982 
Other agencies —  209  —  —  209 
Municipal securities —  45  3,377  —  3,422 
Private-label CMO —  130  22  —  152 
Asset-backed securities —  317  44  —  361 
Corporate debt —  2,294  —  —  2,294 
Other securities/sovereign debt —  4  —  —  4 
Total available-for-sale securities
 5  20,929  3,443  —  24,377 
Other securities 50  3  —  —  53 
Loans held for sale —  777  —  —  777 
Loans held for investment —  162  17  —  179 
MSRs —  —  463  —  463 
Other assets:
Derivative assets —  1,648  6  (1,222) 432 
Assets held in trust for deferred compensation plans 122  —  —  —  122 
Liabilities
Derivative liabilities —  1,381  11  (756) 636 
Fair Value Measurements at Reporting Date Using
Netting Adjustments (1)
 December 31, 2021
(dollar amounts in millions)
Level 1
Level 2
Level 3
Assets
Trading account securities:
Municipal securities $ —  $ 46  $ —  $ —  $ 46 
Available-for-sale securities:
U.S. Treasury securities 5  —  —  —  5 
Residential CMOs —  4,649  —  —  4,649 
Residential MBS —  15,508  —  —  15,508 
Commercial MBS —  1,865  —  —  1,865 
Other agencies —  248  —  —  248 
Municipal securities —  49  3,477  —  3,526 
Private-label CMO —  86  20  —  106 
Asset-backed securities —  312  70  —  382 
Corporate debt —  2,167  —  —  2,167 
Other securities/sovereign debt —  4  —  —  4 
Total available-for-sale securities 5  24,888  3,567  —  28,460 
Other securities 65  7  —  —  72 
Loans held for sale —  1,270  —  —  1,270 
Loans held for investment —  152  19  —  171 
MSRs —  —  351  —  351 
Other assets:
Derivative assets —  1,055  10  (465) 600 
Assets held in trust for deferred compensation plans 156  —  —  —  156 
Liabilities
Derivative liabilities —  737  6  (624) 119 
(1)Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle positive and negative positions and cash collateral held or placed with the same counterparties.
Rollforward of financial instruments measured on a recurring basis and classified as Level 3 The following tables present a rollforward of the balance sheet amounts measured at fair value on a recurring basis and classified as Level 3. The classification of an item as Level 3 is based on the significance of the unobservable inputs to the overall fair value measurement. However, Level 3 measurements may also include observable components of value that can be validated externally. Accordingly, the gains and losses in the table below include changes in fair value due in part to observable factors that are part of the valuation methodology.
Level 3 Fair Value Measurements
Available-for-sale securities Loans held for investment
(dollar amounts in millions) MSRs
Derivative
instruments
Municipal
securities
 Private-
label CMO
Asset-backed
securities
Three Months Ended June 30, 2022
Opening balance $ 416  $ (10) $ 3,282  $ 19  $ 62  $ 18 
Transfers out of Level 3 (1) —  7  —  —  —  — 
Total gains/losses for the period:
Included in earnings:
Mortgage banking income 44  (2) —  —  —  — 
Interest and fee income —  —  —  (1) —  — 
Included in OCI —  —  (88) —  —  — 
Purchases/originations 18  —  386  4  —  — 
Repayments —  —  —  —  —  (1)
Settlements (15) —  (203) —  (18) — 
Closing balance $ 463  $ (5) $ 3,377  $ 22  $ 44  $ 17 
Change in unrealized gains or losses for the period included in earnings for assets held at end of the reporting date $ 44  $ 7  $ —  $ —  $ —  $ — 
Change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period —  —  (90) —  —  — 
Three Months Ended June 30, 2021
Opening balance $ 274  $ 10  $ 3,070  $ 11  $ 47  $ 22 
Transfers out of Level 3 (1) —  (31) —  —  —  — 
Total gains/losses for the period:
Included in earnings:
Mortgage banking income (24) 37  —  —  —  — 
Included in OCI —  —  (1) —  —  — 
Purchases/originations 97  7  1,144  6  38  — 
Sales —  —  (352) —  —  — 
Repayments —  —  —  —  —  (1)
Settlements (20) —  (252) 1  (39) — 
Closing balance $ 327  $ 23  $ 3,609  $ 18  $ 46  $ 21 
Change in unrealized gains or losses for the period included in earnings for assets held at end of the reporting date $ (24) $ 5  $ —  $ —  $ —  $ — 
Change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period —  —  (1) —  —  — 
Level 3 Fair Value Measurements
Available-for-sale securities
Loans held for investment
(dollar amounts in millions)
MSRs
Derivative
instruments
Municipal
securities
 Private- label CMO
Asset-backed
securities
Six Months Ended June 30, 2022
Opening balance $ 351  $ 4  $ 3,477  $ 20  $ 70  $ 19 
Transfers out of Level 3 (1) —  —  —  —  —  — 
Total gains/losses for the period:
Included in earnings
Mortgage banking income 95  (9) —  —  —  — 
Interest and fee income —  —  (2) (2) —  — 
Provision for credit losses —  —  (4) —  —  — 
Included in OCI —  —  (208) —  (1) — 
Purchases/originations 48  —  558  4  —  — 
Repayments —  —  —  —  —  (2)
Settlements (31) —  (444) —  (25) — 
Closing balance $ 463  $ (5) $ 3,377  $ 22  $ 44  $ 17 
Change in unrealized gains or losses for the period included in earnings for assets held at end of the reporting date $ 95  $ (9) $ —  $ —  $ —  $ — 
Change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period —  —  (205) —  —  — 
Six Months Ended June 30, 2021
Opening balance $ 210  $ 41  $ 2,951  $ 9  $ 10  $ 23 
Transfers out of Level 3 (1) —  (70) —  —  —  — 
Total gains/losses for the period:
Included in earnings
Mortgage banking income 27  45  —  —  —  — 
Included in OCI —  —  (5) —  —  — 
Purchases/originations/acquisitions 130  7  1,353  8  75  — 
Sales —  —  (352) —  —  — 
Repayments —  —  —  —  —  (2)
Settlements (40) —  (338) 1  (39) — 
Closing balance $ 327  $ 23  $ 3,609  $ 18  $ 46  $ 21 
Change in unrealized gains or losses for the period included in earnings for assets held at end of the reporting date $ 27  $ (21) $ —  $ —  $ —  $ — 
Change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period —  —  (4) —  —  — 
(1)Transfers out of Level 3 represent the settlement value of the derivative instruments (i.e. interest rate lock agreements) that are transferred to loans held for sale, which is classified as Level 2.
Assets and liabilities under the fair value option
The following tables present the fair value and aggregate principal balance of certain assets and liabilities under the fair value option:
(dollar amounts in millions) Total Loans Loans that are 90 or more days past due
Fair value
carrying
amount
Aggregate
unpaid
principal
 Difference
Fair value
carrying
amount
Aggregate
unpaid
principal
 Difference
June 30, 2022
Assets
Loans held for sale $ 777  $ 778  $ (1) $ —  $ —  $ — 
Loans held for investment 179  184  (5) 5  5  — 
December 31, 2021
Assets
Loans held for sale $ 1,270  $ 1,237  $ 33  $ —  $ —  $ — 
Loans held for investment 171  177  (6) 4  4  — 
The following table presents the net gains (losses) from fair value changes.
(dollar amounts in millions) Three Months Ended June 30, Six Months Ended June 30,
Assets 2022 2021 2022 2021
Loans held for sale (1) $ 10  $ 11  $ (34) $ (23)
Loans held for investment —  —  1  — 
(1)The net gains (losses) from fair value changes are included in Mortgage banking income on the Unaudited Condensed Consolidated Statements of Income.
Assets measured at fair value on a nonrecurring basis
The amounts measured at fair value on a nonrecurring basis were as follows:
Fair Value Measurements Using Significant Other Unobservable Inputs (Level 3) Total Gains (Losses)
Three Months Ended June 30, Six Months Ended June 30,
(dollar amounts in millions) June 30, 2022 December 31, 2021 2022 2021 2022 2021
Collateral-dependent loans $ 32  $ 39  $ —  $ (1) $ (1) $ (2)
Loans held for sale —  —  —  2  —  2 
Quantitative information about significant unobservable level 3 fair value measurement inputs
The table below presents quantitative information about the significant unobservable inputs for assets and liabilities measured at fair value on a recurring and nonrecurring basis:
Quantitative Information about Level 3 Fair Value Measurements
At June 30, 2022 (1) At December 31, 2021 (1)
(dollar amounts in millions) Valuation Technique Significant Unobservable Input Range Weighted Average Range Weighted Average
Measured at fair value on a recurring basis:
MSRs Discounted cash flow Constant prepayment rate 5  % - 25% 7  % 8  % —% 23  % 12  %
Spread over forward interest rate swap rates 5  % - 13% 6  % 3  % —% 11  % 5  %
Derivative assets Consensus Pricing Net market price (15) % - 13% (1) % (4) % —% 8  % 1  %
Estimated pull through % 4  % - 100% 91  % 6  % —% 100  % 92  %
Municipal securities Discounted cash flow Discount rate 3  % - 4% 4  % —  % —% 2  % 1  %
Asset-backed securities Cumulative default —  % - 64% 6  % —  % —% 64  % 5  %
Loss given default 5  % - 80% 24  % 5  % —% 80  % 23  %
(1)     Certain disclosures related to quantitative level 3 fair value measurements do not include those deemed to be immaterial.
Carrying amounts and estimated fair values of financial instruments
The following table provides the carrying amounts and estimated fair values of Huntington’s financial instruments:

(dollar amounts in millions) Amortized Cost Lower of Cost or Market
Fair Value or
Fair Value Option
 Total Carrying Amount Estimated Fair Value
June 30, 2022
Financial Assets
Cash and short-term assets $ 4,104  $ —  $ —  $ 4,104  $ 4,104 
Trading account securities —  —  34  34  34 
Available-for-sale securities —  —  24,377  24,377  24,377 
Held-to-maturity securities 17,355  —  —  17,355  15,916 
Other securities 710  —  53  763  763 
Loans held for sale —  192  777  969  973 
Net loans and leases (1) 113,968  —  179  114,147  110,397 
Derivative assets —  —  432  432  432 
Assets held in trust for deferred compensation plans —  —  122  122  122 
Financial Liabilities
Deposits 145,435  —  —  145,435  145,365 
Short-term borrowings 3,048  —  —  3,048  3,048 
Long-term debt 7,866  —  —  7,866  7,547 
Derivative liabilities —  —  636  636  636 
December 31, 2021
Financial Assets
Cash and short-term assets $ 5,914  $ —  $ —  $ 5,914  $ 5,914 
Trading account securities —  —  46  46  46 
Available-for-sale securities —  —  28,460  28,460  28,460 
Held-to-maturity securities 12,447  —  —  12,447  12,489 
Other securities 576  —  72  648  648 
Loans held for sale —  406  1,270  1,676  1,621 
Net loans and leases (1) 109,066  —  171  109,237  109,695 
Derivative assets —  —  600  600  600 
Assets held in trust for deferred compensation plans —  —  156  156  156 
Financial Liabilities
Deposits 143,263  —  —  143,263  143,574 
Short-term borrowings 334  —  —  334  334 
Long-term debt 7,108  —  —  7,108  7,319 
Derivative liabilities —  —  119  119  119 
(1)Includes collateral-dependent loans.
The following table presents the level in the fair value hierarchy for the estimated fair values at June 30, 2022 and December 31, 2021:
Estimated Fair Value Measurements at Reporting Date Using Netting Adjustments (1)  Presented Balance
(dollar amounts in millions) Level 1 Level 2 Level 3
June 30, 2022
Financial Assets
Trading account securities $ —  $ 34  $ —  $ 34 
Available-for-sale securities 5  20,929  3,443  24,377 
Held-to-maturity securities —  15,916  —  15,916 
Other securities (2) 50  3  —  53 
Loans held for sale —  777  196  973 
Net loans and leases —  162  110,235  110,397 
Derivative assets —  1,648  6  $ (1,222) 432 
Financial Liabilities
Deposits —  141,762  3,603  145,365 
Short-term borrowings —  3,048  —  3,048 
Long-term debt —  6,757  790  7,547 
Derivative liabilities —  1,381  11  (756) 636 
December 31, 2021
Financial Assets
Trading account securities $ —  $ 46  $ —  $ 46 
Available-for-sale securities 5  24,888  3,567  28,460 
Held-to-maturity securities —  12,489  —  12,489 
Other securities (2) 65  7  —  72 
Loans held for sale —  1,270  351  1,621 
Net loans and leases —  152  109,543  109,695 
Derivative assets —  1,055  10  $ (465) 600 
Financial Liabilities
Deposits —  139,047  4,527  143,574 
Short-term borrowings —  334  —  334 
Long-term debt —  6,441  878  7,319 
Derivative liabilities —  737  6  (624) 119 
(1)Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle positive and negative positions and cash collateral held or placed with the same counterparties.
(2)Excludes securities without readily determinable fair values.