Annual report pursuant to Section 13 and 15(d)

INVESTMENT SECURITIES AND OTHER SECURITIES

v3.19.3.a.u2
INVESTMENT SECURITIES AND OTHER SECURITIES
 12 Months Ended
Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]  
Investment Securities Disclosure [Text Block]
The following tables provide amortized cost, fair value, and gross unrealized gains and losses by investment category at December 31, 2019 and 2018:
 
 
 
Unrealized
 
 
(dollar amounts in millions)
Amortized
Cost
 
Gross
Gains
 
Gross
Losses
 
Fair Value
December 31, 2019
 
 
 
 
 
 
 
Available-for-sale securities:
 
 
 
 
 
 
 
U.S. Treasury
$
10

 
$
—

 
$
—

 
$
10

Federal agencies:
 
 
 
 
 
 
 
Residential CMO
5,055

 
48

 
(18
)
 
5,085

Residential MBS
4,180

 
45

 
(3
)
 
4,222

Commercial MBS
979

 
1

 
(4
)
 
976

Other agencies
165

 
1

 
(1
)
 
165

Total U.S. Treasury, federal agency and other agency securities
10,389

 
95

 
(26
)
 
10,458

Municipal securities
3,044

 
34

 
(23
)
 
3,055

Private-label CMO
2

 
—

 
—

 
2

Asset-backed securities
575

 
6

 
(2
)
 
579

Corporate debt
49

 
2

 
—

 
51

Other securities/Sovereign debt
4

 
—

 
—

 
4

Total available-for-sale securities
$
14,063

 
$
137

 
$
(51
)
 
$
14,149

 
 
 
 
 
 
 
 
Held-to-maturity securities:
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
Residential CMO
$
2,351

 
$
33

 
$
(3
)
 
$
2,381

Residential MBS
2,463

 
50

 
—

 
2,513

Commercial MBS
3,959

 
34

 
—

 
3,993

Other agencies
293

 
2

 
—

 
295

Total federal agency and other agency securities
9,066

 
119

 
(3
)
 
9,182

Municipal securities
4

 
—

 
—

 
4

Total held-to-maturity securities
$
9,070

 
$
119

 
$
(3
)
 
$
9,186

 
 
 
 
 
 
 
 
Other securities, at cost:
 
 
 
 
 
 
 
Non-marketable equity securities:
 
 
 
 
 
 
 
Federal Home Loan Bank stock
$
90

 
$
—

 
$
—

 
$
90

Federal Reserve Bank stock
297

 
—

 
—

 
297

Other securities, at fair value
 
 
 
 
 
 
 
Mutual funds
53

 
—

 
—

 
53

Marketable equity securities
1

 
—

 
—

 
1

Total other securities
$
441

 
$
—

 
$
—

 
$
441

 
 
 
Unrealized
 
 
(dollar amounts in millions)
Amortized
Cost
 
Gross
Gains
 
Gross
Losses
 
Fair Value
December 31, 2018
 
 
 
 
 
 
 
Available-for-sale securities:
 
 
 
 
 
 
 
U.S. Treasury
$
5

 
$
—

 
$
—

 
$
5

Federal agencies:
 
 
 
 
 
 
 
Residential CMO
7,185

 
15

 
(201
)
 
6,999

Residential MBS
1,261

 
9

 
(15
)
 
1,255

Commercial MBS
1,641

 
—

 
(58
)
 
1,583

Other agencies
128

 
—

 
(2
)
 
126

Total U.S. Treasury, federal agency and other agency securities
10,220

 
24

 
(276
)
 
9,968

Municipal securities
3,512

 
6

 
(78
)
 
3,440

Asset-backed securities
318

 
1

 
(4
)
 
315

Corporate debt
54

 
—

 
(1
)
 
53

Other securities/Sovereign debt
4

 
—

 
—

 
4

Total available-for-sale securities
$
14,108

 
$
31

 
$
(359
)
 
$
13,780

 
 
 
 
 
 
 
 
Held-to-maturity securities:
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
Residential CMO
$
2,124

 
$
—

 
$
(47
)
 
$
2,077

Residential MBS
1,851

 
2

 
(42
)
 
1,811

Commercial MBS
4,235

 
—

 
(186
)
 
4,049

Other agencies
350

 
—

 
(6
)
 
344

Total federal agency and other agency securities
8,560

 
2

 
(281
)
 
8,281

Municipal securities
5

 
—

 
—

 
5

Total held-to-maturity securities
$
8,565

 
$
2

 
$
(281
)
 
$
8,286

 
 
 
 
 
 
 
 
Other securities, at cost:
 
 
 
 
 
 
 
Non-marketable equity securities:
 
 
 
 
 
 
 
Federal Home Loan Bank stock
$
248

 
$
—

 
$
—

 
$
248

Federal Reserve Bank stock
295

 
—

 
—

 
295

Other securities, at fair value
 
 
 
 
 
 
 
Mutual funds
20

 
—

 
—

 
20

Marketable equity securities
1

 
1

 
—

 
2

Total other securities
$
564

 
$
1

 
$
—

 
$
565



The following table provides the amortized cost and fair value of securities by contractual maturity at December 31, 2019 and 2018. Expected maturities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without incurring penalties.
 
2019
 
2018
(dollar amounts in millions)
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Available-for-sale securities:
 
 
 
 
 
 
 
Under 1 year
$
231

 
$
229

 
$
186

 
$
185

After 1 year through 5 years
1,196

 
1,189

 
1,057

 
1,039

After 5 years through 10 years
1,594

 
1,606

 
1,838

 
1,802

After 10 years
11,042

 
11,125

 
11,027

 
10,754

Total available-for-sale securities
$
14,063

 
$
14,149

 
$
14,108

 
$
13,780

 
 
 
 
 
 
 
 
Held-to-maturity securities:
 
 
 
 
 
 
 
Under 1 year
$
—

 
$
—

 
$
—

 
$
—

After 1 year through 5 years
17

 
17

 
11

 
11

After 5 years through 10 years
300

 
305

 
362

 
356

After 10 years
8,753

 
8,864

 
8,192

 
7,919

Total held-to-maturity securities
$
9,070

 
$
9,186

 
$
8,565

 
$
8,286


The following tables provide detail on investment securities with unrealized losses aggregated by investment category and the length of time the individual securities have been in a continuous loss position at December 31, 2019 and 2018:
 
Less than 12 Months
 
Over 12 Months
 
Total
(dollar amounts in millions)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities:
 
 
 
 
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Residential CMO
$
1,206

 
$
(10
)
 
$
519

 
$
(8
)
 
$
1,725

 
$
(18
)
Residential MBS
1,169

 
(3
)
 
9

 
—

 
1,178

 
(3
)
Commercial MBS
472

 
(2
)
 
272

 
(2
)
 
744

 
(4
)
Other agencies
86

 
(1
)
 
—

 
—

 
86

 
(1
)
Total federal agency and other agency securities
2,933

 
(16
)
 
800

 
(10
)
 
3,733

 
(26
)
Municipal securities
273

 
(4
)
 
1,204

 
(19
)
 
1,477

 
(23
)
Asset-backed securities
116

 
(1
)
 
37

 
(1
)
 
153

 
(2
)
Corporate debt
1

 
—

 
—

 
—

 
1

 
—

Total temporarily impaired securities
$
3,323

 
$
(21
)
 
$
2,041

 
$
(30
)
 
$
5,364

 
$
(51
)
 
 
 
 
 
 
 
 
 
 
 
 
Held-to-maturity securities:
 
 
 
 
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Residential CMO
$
218

 
$
(1
)
 
$
112

 
$
(2
)
 
$
330

 
$
(3
)
Residential MBS
317

 
—

 
—

 
—

 
317

 
—

Commercial MBS
81

 
—

 
—

 
—

 
81

 
—

Other agencies
58

 
—

 
—

 
—

 
58

 
—

Total federal agency and other agency securities
674

 
(1
)
 
112

 
(2
)
 
786

 
(3
)
Municipal securities
4

 
—

 
—

 
—

 
4

 
—

Total temporarily impaired securities
$
678

 
$
(1
)
 
$
112

 
$
(2
)
 
$
790

 
$
(3
)
 
Less than 12 Months
 
Over 12 Months
 
Total
(dollar amounts in millions)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities:
 
 
 
 
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Residential CMO
$
425

 
$
(3
)
 
$
5,943

 
$
(198
)
 
$
6,368

 
$
(201
)
Residential MBS
259

 
(6
)
 
319

 
(9
)
 
578

 
(15
)
Commercial MBS
10

 
—

 
1,573

 
(58
)
 
1,583

 
(58
)
Other agencies
—

 
—

 
124

 
(2
)
 
124

 
(2
)
Total federal agency and other agency securities
694

 
(9
)
 
7,959

 
(267
)
 
8,653

 
(276
)
Municipal securities
1,425

 
(24
)
 
1,602

 
(54
)
 
3,027

 
(78
)
Asset-backed securities
95

 
(2
)
 
117

 
(2
)
 
212

 
(4
)
Corporate debt
40

 
—

 
1

 
(1
)
 
41

 
(1
)
Total temporarily impaired securities
$
2,254

 
$
(35
)
 
$
9,679

 
$
(324
)
 
$
11,933

 
$
(359
)
 
 
 
 
 
 
 
 
 
 
 
 
Held-to-maturity securities:
 
 
 
 
 
 
 
 
 
 
 
Federal agencies:
 
 
 
 
 
 
 
 
 
 
 
Residential CMO
$
12

 
$
—

 
$
2,004

 
$
(47
)
 
$
2,016

 
$
(47
)
Residential MBS
16

 
—

 
1,457

 
(42
)
 
1,473

 
(42
)
Commercial MBS
—

 
—

 
4,041

 
(186
)
 
4,041

 
(186
)
Other agencies
113

 
(2
)
 
205

 
(4
)
 
318

 
(6
)
Total federal agency and other agency securities
141

 
(2
)
 
7,707

 
(279
)
 
7,848

 
(281
)
Municipal securities
—

 
—

 
4

 
—

 
4

 
—

Total temporarily impaired securities
$
141

 
$
(2
)
 
$
7,711

 
$
(279
)
 
$
7,852

 
$
(281
)

At December 31, 2019 and December 31, 2018, the market value of investment securities pledged to secure public and trust deposits, trading account liabilities, U.S. Treasury demand notes, and security repurchase agreements totaled $3.8 billion and $4.5 billion, respectively. There were no securities of a single issuer, which were not governmental or government-sponsored, that exceeded 10% of shareholders’ equity at either December 31, 2019 or December 31, 2018.
The following table is a summary of realized securities gains and losses for the years ended December 31, 2019, 2018, and 2017:
 
Year Ended December 31,
(dollar amounts in millions)
2019
 
2018
 
2017
Gross gains on sales of securities
$
11

 
$
7

 
$
10

Gross losses on sales of securities
(35
)
 
(28
)
 
(10
)
Net gain (loss) on sales of securities
$
(24
)
 
$
(21
)
 
$
—

OTTI recognized in earnings
—

 
—

 
(4
)
Net securities (losses)
$
(24
)
 
$
(21
)
 
$
(4
)

Security Impairment
Huntington evaluates the securities portfolio for impairment on a quarterly basis. As of December 31, 2019 and December 31, 2018, the Company has evaluated available-for-sale and held-to-maturity securities which have gross unrealized losses for impairment and concluded less than $1 million and no OTTI was required, respectively.
Other securities that are carried at cost are reviewed for impairment on a quarterly basis, with valuation adjustments recognized in other noninterest income. As of December 31, 2019 and December 31, 2018, the Company concluded no impairment was required.