Annual report pursuant to Section 13 and 15(d)


12 Months Ended
Dec. 31, 2020
Segment Reporting [Abstract]  
Huntington’s business segments are based on our internally-aligned segment leadership structure, which is how management monitors results and assesses performance. The Company has four major business segments: Consumer and Business Banking, Commercial Banking, Vehicle Finance, Regional Banking and The Huntington Private Client Group (RBHPCG). The Treasury / Other function includes technology and operations, other unallocated assets, liabilities, revenue, and expense.
Business segment results are determined based upon Huntington’s management reporting system, which assigns balance sheet and income statement items to each of the business segments. The process is designed around the organizational and management structure and, accordingly, the results derived are not necessarily comparable with similar information published by other financial institutions. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities.
Revenue is recorded in the business segment responsible for the related product or service. Fee sharing is recorded to allocate portions of such revenue to other business segments involved in selling to, or providing service to customers. Results of operations for the business segments reflect these fee sharing allocations.
The management process that develops the business segment reporting utilizes various estimates and allocation methodologies to measure the performance of the business segments. Expenses are allocated to business segments using a two-phase approach. The first phase consists of measuring and assigning unit costs (activity-based costs) to activities related to product origination and servicing. These activity-based costs are then extended, based on volumes, with the resulting amount allocated to business segments that own the related products. The second phase consists of the allocation of overhead costs to all four business segments from Treasury / Other. Huntington
utilizes a full-allocation methodology, where all Treasury / Other expenses, except a small amount of other residual unallocated expenses, are allocated to the four business segments.
The management policies and processes utilized in compiling segment financial information are highly subjective and, unlike financial accounting, are not based on authoritative guidance similar to GAAP. As a result, reported segment results are not necessarily comparable with similar information reported by other financial institutions. Furthermore, changes in management structure or allocation methodologies and procedures result in changes in reported segment financial data. Accordingly, certain amounts have been reclassified to conform to the current period presentation.
Huntington uses an active and centralized FTP methodology to attribute appropriate net interest income to the business segments. The intent of the FTP methodology is to transfer interest rate risk from the business segments by providing matched duration funding of assets and liabilities. The result is to centralize the financial impact, management, and reporting of interest rate risk in the Treasury / Other function where it can be centrally monitored and managed. The Treasury / Other function charges (credits) an internal cost of funds for assets held in (or pays for funding provided by) each business segment. The FTP rate is based on prevailing market interest rates for comparable duration assets (or liabilities).
Consumer and Business Banking - The Consumer and Business Banking segment, including Home Lending, 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, mortgage loans, consumer loans, credit cards, and small business loans and investment products. Other financial services available to customers include insurance, interest rate risk protection, foreign exchange, and treasury management. Business Banking is defined as serving companies with revenues up to $20 million. Home Lending supports origination and servicing of consumer loans and mortgages for customers who are generally located in our primary banking markets across all segments.
Commercial Banking - Through a relationship banking model, this segment provides a wide array of products and services to the middle market, large corporate, real estate and government public sector customers located primarily within our geographic footprint. The segment is divided into four business units: Relationship Banking Group, Specialized Lending Group, Treasury Management/Deposits Group and Capital Markets Group.
Vehicle Finance - Our products and services include providing financing to consumers for the purchase of automobiles, light-duty trucks, recreational vehicles, and marine craft at franchised and other select dealerships, and providing financing to franchised dealerships for the acquisition of new and used inventory. Products and services are delivered through highly specialized relationship-focused bankers and product partners.
Regional Banking and The Huntington Private Client Group - The core business of The Huntington Private Client Group is The Huntington Private Bank, which consists of Private Banking, Wealth & Investment Management, and Retirement Plan Services. The Huntington Private Bank provides high net-worth customers with deposit, lending (including specialized lending options), and banking services. The Huntington Private Bank also delivers wealth management and legacy planning through investment and portfolio management, fiduciary administration, and trust services. This group also provides retirement plan services to corporate businesses. The Huntington Private Client Group provides corporate trust services and institutional and mutual fund custody services.
Listed in the table below is certain operating basis financial information reconciled to Huntington’s December 31, 2020, December 31, 2019, and December 31, 2018, reported results by business segment:
Income Statements
(dollar amounts in millions)
Consumer & Business Banking Commercial Banking Vehicle Finance RBHPCG Treasury / Other
Net interest income $ 1,436  $ 903  $ 430  $ 160  $ 295  $ 3,224 
Provision (benefit) for credit losses 265  626  146  11  —  1,048 
Noninterest income 945  364  201  72  1,591 
Noninterest expense 1,774  542  141  243  95  2,795 
Provision (benefit) for income taxes 72  21  32  22  155 
Net income (loss) $ 270  $ 78  $ 120  $ 85  $ 264  $ 817 
Net interest income $ 1,766  $ 1,037  $ 397  $ 198  $ (185) $ 3,213 
Provision (benefit) for credit losses 114  132  44  (3) —  287 
Noninterest income 825  359  12  198  60  1,454 
Noninterest expense 1,673  564  148  256  80  2,721 
Provision (benefit) for income taxes 169  147  45  30  (143) 248 
Net income (loss) $ 635  $ 553  $ 172  $ 113  $ (62) $ 1,411 
Net interest income $ 1,727  $ 1,013  $ 392  $ 203  $ (146) $ 3,189 
Provision (benefit) for credit losses 137  42  55  —  235 
Noninterest income 744  321  11  193  52  1,321 
Noninterest expense 1,699  502  143  244  59  2,647 
Provision (benefit) for income taxes 133  166  43  32  (139) 235 
Net income (loss) $ 502  $ 624  $ 162  $ 119  $ (14) $ 1,393 
Assets at
December 31,
Deposits at
December 31,
(dollar amounts in millions) 2020 2019 2020 2019
Consumer & Business Banking $ 30,758  $ 25,073  $ 60,910  $ 51,675 
Commercial Banking 36,311  34,337  24,766  20,762 
Vehicle Finance 19,789  20,155  722  376 
RBHPCG 7,064  6,665  7,635  6,370 
Treasury / Other 29,116  22,772  4,915  3,164 
Total $ 123,038  $ 109,002  $ 98,948  $ 82,347