|12 Months Ended|
Dec. 31, 2022
|Retirement Benefits [Abstract]|
|BENEFIT PLANS||BENEFIT PLANS
Huntington sponsors a non-contributory defined benefit pension plan covering substantially all employees hired or rehired prior to January 1, 2010. The Plan, which was modified in 2013, no longer accrues service benefits to participants and provides benefits based upon length of service and compensation levels. Huntington’s funding policy is to contribute an annual amount that is at least equal to the minimum funding requirements but not more than the amount deductible under the Internal Revenue Code. There were no required minimum contributions during 2022.
The following table shows the weighted-average assumptions used to determine the benefit obligation and the net periodic benefit cost:
The following table reconciles the beginning and ending balances of the benefit obligation of the Plan with the amounts recognized in the consolidated balance sheets:
The following table reconciles the beginning and ending balances of the fair value of Plan assets:
As of December 31, 2022, the difference between the accumulated benefit obligation and the fair value of Plan assets was $48 million and is recorded in other assets.
The following table shows the components of net periodic benefit costs recognized:
(1) The pension costs are recognized in other noninterest income in the Consolidated Statements of Income.
At December 31, 2022 and 2021, The Huntington National Bank, as trustee, held all Plan assets. The Plan assets consisted of investments in a variety of cash equivalent, corporate and government fixed income, and equity investments as follows:
Investments of the Plan are accounted for at cost on the trade date and are reported at fair value. The valuation methodologies used to measure the fair value of pension plan assets vary depending on the type of asset. At December 31, 2022, mutual money market funds are valued at the closing price reported from an actively traded exchange and are classified as Level 1. Fixed income investments are valued using unadjusted quoted prices from active markets for similar assets are classified as Level 2. Common stock is valued using the year-end closing price as determined by a national securities exchange and are classified as Level 1. Collective trust funds and limited liability companies are valued at net asset value per unit as a practical expedient, which is calculated based on the fair values of the underlying investments held by the fund less its liabilities as reported by the issuer of the fund. The investment in the limited partnerships is reported at net asset value per share as determined by the general partners of each limited partnership, based on their proportionate share of the partnership’s fair value as recorded in the partnership’s audited financial statements.
The investment objective of the Plan is to maximize the return on Plan assets over a long-time period, while meeting the Plan obligations. At December 31, 2022, Plan assets were invested 3% in cash equivalents, 11% in equity investments, and 86% in fixed income investments, with an average duration of 10.9 years on investments. The estimated life of benefit obligations was 10.3 years. Although it may fluctuate with market conditions, Huntington has targeted a long-term allocation of Plan assets of 10% in equity investments and 90% in bond investments. The allocation of Plan assets between equity investments and fixed income investments will change from time to time.
At December 31, 2022, the following table shows when benefit payments are expected to be paid:
Huntington has a defined contribution plan that is available to eligible employees. Huntington’s expense related to the defined contribution plans for the years ended December 31, 2022, 2021, and 2020 was $58 million, $70 million, and $47 million, respectively.
The following table shows the number of shares, market value, and dividends received on shares of Huntington stock held by the defined contribution plan:
The entire disclosure for retirement benefits.
Reference 1: http://www.xbrl.org/2003/role/exampleRef