Annual report pursuant to Section 13 and 15(d)

LOAN SALES AND SECURITIZATIONS (Tables)

v3.8.0.1
LOAN SALES AND SECURITIZATIONS (Tables)
 12 Months Ended
Dec. 31, 2017
Transfers and Servicing [Abstract]  
Schedule of activity relating to loans securitized sold with servicing rights
The following table summarizes activity relating to SBA loans sold with servicing retained for the years ended December 31, 2017, 2016, and 2015:
 
Year Ended December 31,
(dollar amounts in millions)
2017
 
2016
 
2015
SBA loans sold with servicing retained
$
413

 
$
270

 
$
233

Pretax gains resulting from above loan sales (1)
32

 
21

 
19

(1)
Recorded in gain on sale of loans.
The following table summarizes activity relating to residential mortgage loans sold with servicing retained for the years ended December 31, 2017, 2016, and 2015:
  
Year Ended December 31,
(dollar amounts in millions)
2017
 
2016
 
2015
Residential mortgage loans sold with servicing retained
$
3,985

 
$
3,632

 
$
3,323

Pretax gains resulting from above loan sales (1)
99

 
97

 
83

(1)
Recorded in mortgage banking income.
The following table summarizes activity relating to automobile loans securitized with servicing retained for the years ended December 31, 2017, 2016, and 2015:
 
Year Ended December 31,
(dollar amounts in millions)
2017 (1)
 
2016
 
2015
UPB of automobile loans securitized with servicing retained
$
—

 
1,500

 
750

Net proceeds received in loan securitizations
—

 
1,552

 
780

Servicing asset recognized in loan securitizations (2)
—

 
15

 
11

Pretax gains resulting from above loan securitizations (3)
—

 
6

 
5

(1)
Huntington did not sell or securitize any automobile loans in 2017.
(2)
Recorded in servicing rights.
(3)
Recorded in gain on sale of loans
Servicing asset at fair value
The following table summarizes the changes in MSRs recorded using the amortization method for the years ended December 31, 2017 and 2016:
 
 
 
 
Servicing asset at amortized cost
The following tables summarize the changes in the carrying value of the servicing asset for the years ended December 31, 2017, and 2016:
(dollar amounts in millions)
2017
 
2016
Carrying value, beginning of year
$
21

 
$
20

New servicing assets created
14

 
9

Amortization and other
(8
)
 
(8
)
Carrying value, end of year
$
27

 
$
21

Fair value, end of year
$
30

 
$
24

Weighted-average life (years)
3.3

 
3.3

Changes in the carrying value of automobile loan servicing rights for the years ended December 31, 2017, and 2016, and the fair value at the end of each period were as follows:
(dollar amounts in millions)
2017
 
2016
Carrying value, beginning of year
$
18

 
$
9

New servicing assets created
—

 
15

Amortization and other
(10
)
 
(6
)
Carrying value, end of year
$
8

 
$
18

Fair value, end of year
$
9

 
$
18

Weighted-average life (years)
3.5

 
4.2

(dollar amounts in millions)
2017
 
2016
Carrying value, beginning of year
$
172

 
$
143

New servicing assets created
44

 
38

Servicing assets acquired
—

 
15

Impairment recovery (charge)
1

 
2

Amortization and other
(26
)
 
(26
)
Carrying value, end of year
$
191

 
$
172

Fair value, end of year
$
191

 
$
173

Weighted-average life (years)
7.1

 
7.2

Summary of key assumptions and the sensitivity analysis of servicing rights
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For MSRs under the amortization method, a summary of key assumptions and the sensitivity of the MSR value to changes in these assumptions at December 31, 2017, and 2016 follows:
 
December 31, 2017
 
December 31, 2016
 
 
 
Decline in fair value due to
 
 
 
Decline in fair value due to
(dollar amounts in millions)
Actual
 
10%
adverse
change
 
20%
adverse
change
 
Actual
 
10%
adverse
change
 
20%
adverse
change
Constant prepayment rate (annualized)
8.30
%
 
$
(5
)
 
$
(10
)
 
7.80
%
 
$
(5
)
 
$
(9
)
Spread over forward interest rate swap rates
1,049
 bps
 
(7
)
 
(13
)
 
1,173
 bps
 
(5
)
 
(10
)