Annual report pursuant to Section 13 and 15(d)

LOANS AND LEASES

v3.22.4
LOANS AND LEASES
 12 Months Ended
Dec. 31, 2022
Receivables [Abstract]  
LOANS AND LEASES LOANS AND LEASES
The following table provides a detailed listing of Huntington’s loan and lease portfolio.
At December 31,
(dollar amounts in millions) 2022 2021
Commercial loan and lease portfolio:
Commercial and industrial $ 45,127  $ 41,688 
Commercial real estate 16,634  14,961 
Lease financing 5,252  5,000 
Total commercial loan and lease portfolio 67,013  61,649 
Consumer loan portfolio:
Residential mortgage 22,226  19,256 
Automobile 13,154  13,434 
Home equity 10,375  10,550 
RV and marine 5,376  5,058 
Other consumer 1,379  1,320 
Total consumer loan portfolio 52,510  49,618 
Total loans and leases (1)(2) 119,523  111,267 
Allowance for loan and lease losses (2,121) (2,030)
Net loans and leases $ 117,402  $ 109,237 
(1)Loans and leases are reported at principal amount outstanding including unamortized purchase premiums and discounts, unearned income, and net direct fees and costs associated with originating and acquiring loans and leases. The aggregate amount of these loan and lease adjustments was a net premium (discount) of $3 million and $(111) million at December 31, 2022 and 2021, respectively.
(2)The total amount of accrued interest recorded for these loans and leases at December 31, 2022, was $274 million and $186 million of commercial and consumer loan and lease portfolios, respectively, and at December 31, 2021, was $148 million and $150 million of commercial and consumer loan and lease portfolios, respectively. Accrued interest is presented in accrued income and other receivables within the Condensed Consolidated Balance Sheets.
Lease Financing
The following table presents net investments in lease financing receivables by category.
 
At December 31,
(dollar amounts in millions) 2022 2021
Lease payments receivable $ 4,916  $ 4,620 
Estimated residual value of leased assets 788  774 
Gross investment in lease financing receivables 5,704  5,394 
Deferred origination costs 46  36 
Deferred fees, unearned income and other (498) (430)
Total lease financing receivables $ 5,252  $ 5,000 
The carrying value of residual values guaranteed was $466 million and $473 million as of December 31, 2022 and December 31, 2021, respectively. The future lease rental payments due from customers on sales-type and direct financing leases at December 31, 2022, totaled $4.9 billion and were due as follows: $834 million in 2023, $781 million in 2024, $749 million in 2025, $725 million in 2026, $730 million in 2027, and $1.1 billion thereafter. Interest income recognized for these types of leases was $249 million, $193 million, and $106 million for the years 2022, 2021, and 2020, respectively.
Nonaccrual and Past Due Loans and Leases
The following table presents NALs by class. 
At December 31, 2022 At December 31, 2021
(dollar amounts in millions) Nonaccrual loans with no ACL Total nonaccrual loans Nonaccrual loans with no ACL Total nonaccrual loans
Commercial and industrial $ 49  $ 288  $ 81  $ 370 
Commercial real estate 63  92  80  104 
Lease financing —  18  3  48 
Residential mortgage —  90  —  111 
Automobile —  4  —  3 
Home Equity —  76  —  79 
RV and marine —  1  —  1 
Total nonaccrual loans and leases $ 112  $ 569  $ 164  $ 716 
The total amount of interest recorded to interest income for NAL loans was $23 million, $10 million, and $6 million in 2022, 2021, and 2020, respectively.
The following tables present an aging analysis of loans and leases, by class.
At December 31, 2022
Past Due (1)  Loans Accounted for Under FVO Total Loans
and Leases		 90 or
more days
past due
and accruing
(dollar amounts in millions) 30-59
 Days		 60-89
 Days		 90 or 
more days		 Total Current
Commercial and industrial $ 53  $ 19  $ 108  $ 180  $ 44,947  $ —  $ 45,127  $ 23  (2)
Commercial real estate 2  1  9  12  16,622  —  16,634  — 
Lease financing 36  18  10  64  5,188  —  5,252  9  (3)
Residential mortgage 246  69  199  514  21,528  184  22,226  146  (4)
Automobile 88  20  11  119  13,035  —  13,154  9 
Home equity 56  30  66  152  10,222  1  10,375  15 
RV and marine 15  5  3  23  5,353  —  5,376  3 
Other consumer 13  3  3  19  1,360  —  1,379  2 
Total loans and leases $ 509  $ 165  $ 409  $ 1,083  $ 118,255  $ 185  $ 119,523  $ 207 
At December 31, 2021
Past Due (1) Loans Accounted for Under FVO Total Loans
and Leases		 90 or
more days
past due
and accruing
(dollar amounts in millions) 30-59
 Days
 60-89
 Days
 90 or more days Total Current
Commercial and industrial $ 72  $ 69  $ 107  $ 248  $ 41,440  $ —  $ 41,688  $ 13  (2)
Commercial real estate 9  1  9  19  14,942  —  14,961  — 
Lease financing 39  13  17  69  4,931  —  5,000  11  (3)
Residential mortgage 151  49  233  433  18,653  170  19,256  157  (4)
Automobile 79  18  8  105  13,329  —  13,434  6 
Home equity 48  35  76  159  10,390  1  10,550  17 
RV and marine 14  4  3  21  5,037  —  5,058  3 
Other consumer 13  2  3  18  1,302  —  1,320  3 
Total loans and leases $ 425  $ 191  $ 456  $ 1,072  $ 110,024  $ 171  $ 111,267  $ 210 
(1)NALs are included in this aging analysis based on the loan’s past due status.
(2)Amounts include PPP and other SBA loans and leases.
(3)Amounts include Huntington Technology Finance administrative lease delinquencies.
(4)Amounts include mortgage loans insured by U.S. government agencies.
Credit Quality Indicators
To facilitate the monitoring of credit quality for commercial loans, and for purposes of determining an appropriate ACL level for these loans, Huntington utilizes the following internally defined categories of credit grades:
•Pass - Higher quality loans that do not fit any of the other categories described below.
•OLEM - The credit risk may be relatively minor yet represents a risk given certain specific circumstances. If the potential weaknesses are not monitored or mitigated, the loan may weaken or the collateral may be inadequate to protect Huntington’s position in the future. For these reasons, Huntington considers the loans to be potential problem loans.
•Substandard - Inadequately protected loans resulting from the borrower’s ability to repay, equity, and/or the collateral pledged to secure the loan. These loans have identified weaknesses that could hinder normal repayment or collection of the debt. It is likely Huntington will sustain some loss if any identified weaknesses are not mitigated.
•Doubtful - Loans that have all of the weaknesses inherent in those loans classified as Substandard, with the added elements of the full collection of the loan is improbable and that the possibility of loss is high.
Loans are generally assigned a category of “Pass” rating upon initial approval and subsequently updated as appropriate based on the borrower’s financial performance.
Commercial loans categorized as OLEM, Substandard, or Doubtful are considered Criticized loans. Commercial loans categorized as Substandard or Doubtful are both considered Classified loans.
For all classes within the consumer loan portfolios, borrower credit bureau scores are monitored as an indicator of credit quality. A credit bureau score is a credit score developed by FICO based on data provided by the credit bureaus. The credit bureau score is widely accepted as the standard measure of consumer credit risk used by lenders, regulators, rating agencies, and consumers. The higher the credit bureau score, the higher likelihood of repayment and therefore, an indicator of higher credit quality.
Huntington assesses the risk in the loan portfolio by utilizing numerous risk characteristics. The classifications described above, and also presented in the table below, represent one of those characteristics that are closely monitored in the overall credit risk management processes.
The following tables present the amortized cost basis of loans and leases by vintage and credit quality indicator.
At December 31, 2022
Term Loans Amortized Cost Basis by Origination Year Revolver Total at Amortized Cost Basis Revolver Total Converted to Term Loans
(dollar amounts in millions) 2022 2021 2020 2019 2018 Prior Total
Commercial and industrial
Credit Quality Indicator (1):
Pass $ 16,480  $ 6,597  $ 3,279  $ 2,040  $ 1,068  $ 1,163  $ 12,077  $ 3  $ 42,707 
OLEM 108  139  72  21  49  26  112  —  527 
Substandard 364  181  189  212  141  255  550  —  1,892 
Doubtful —  —  —  —  —  1  —  —  1 
Total Commercial and industrial $ 16,952  $ 6,917  $ 3,540  $ 2,273  $ 1,258  $ 1,445  $ 12,739  $ 3  $ 45,127 
Commercial real estate
Credit Quality Indicator (1):
Pass $ 5,634  $ 3,260  $ 1,616  $ 1,728  $ 917  $ 1,044  $ 1,502  $ —  $ 15,701 
OLEM 61  53  1  43  6  9  —  —  173 
Substandard 235  118  105  75  85  140  2  —  760 
Total Commercial real estate $ 5,930  $ 3,431  $ 1,722  $ 1,846  $ 1,008  $ 1,193  $ 1,504  $ —  $ 16,634 
Lease financing
Credit Quality Indicator (1):
Pass $ 1,930  $ 1,291  $ 952  $ 447  $ 186  $ 143  $ —  $ —  $ 4,949 
OLEM 32  9  15  18  6  3  —  —  83 
Substandard 65  37  74  24  9  11  —  —  220 
Total Lease financing $ 2,027  $ 1,337  $ 1,041  $ 489  $ 201  $ 157  $ —  $ —  $ 5,252 
Residential mortgage
Credit Quality Indicator (2):
750+ $ 3,666  $ 6,274  $ 3,566  $ 846  $ 469  $ 2,070  $ —  $ —  $ 16,891 
650-749 1,394  1,172  617  211  137  777  —  —  4,308 
<650 49  68  61  95  90  480  —  —  843 
Total Residential mortgage $ 5,109  $ 7,514  $ 4,244  $ 1,152  $ 696  $ 3,327  $ —  $ —  $ 22,042 
Automobile
Credit Quality Indicator (2):
750+ $ 2,770  $ 2,212  $ 1,243  $ 777  $ 289  $ 98  $ —  $ —  $ 7,389 
650-749 1,944  1,508  683  367  162  52  —  —  4,716 
<650 307  352  173  115  67  35  —  —  1,049 
Total Automobile $ 5,021  $ 4,072  $ 2,099  $ 1,259  $ 518  $ 185  $ —  $ —  $ 13,154 
Home Equity
Credit Quality Indicator (2):
750+ $ 463  $ 573  $ 611  $ 23  $ 20  $ 301  $ 4,787  $ 252  $ 7,030 
650-749 131  88  68  9  8  122  2,129  261  2,816 
<650 3  3  3  2  2  51  335  129  528 
Total Home equity $ 597  $ 664  $ 682  $ 34  $ 30  $ 474  $ 7,251  $ 642  $ 10,374 
RV and marine
Credit Quality Indicator (2):
750+ $ 1,148  $ 1,031  $ 731  $ 361  $ 354  $ 438  $ —  $ —  $ 4,063 
650-749 290  315  200  118  113  169  —  —  1,205 
<650 5  18  15  17  17  36  —  —  108 
Total RV and marine $ 1,443  $ 1,364  $ 946  $ 496  $ 484  $ 643  $ —  $ —  $ 5,376 
Other consumer
Credit Quality Indicator (2):
750+ $ 207  $ 64  $ 35  $ 34  $ 13  $ 52  $ 393  $ 3  $ 801 
650-749 71  30  12  15  4  14  355  16  517 
<650 3  3  2  3  1  2  33  14  61 
Total Other consumer $ 281  $ 97  $ 49  $ 52  $ 18  $ 68  $ 781  $ 33  $ 1,379 
At December 31, 2021
Term Loans Amortized Cost Basis by Origination Year Revolver Total at Amortized Cost Basis Revolver Total Converted to Term Loans
(dollar amounts in millions) 2021 2020 2019 2018 2017 Prior Total
Commercial and industrial
Credit Quality Indicator (1):
Pass $ 15,435  $ 5,677  $ 3,682  $ 1,983  $ 1,080  $ 1,134  $ 9,945  $ 3  $ 38,939 
OLEM 183  178  87  83  38  73  166  —  808 
Substandard 336  203  344  206  125  167  552  —  1,933 
Doubtful 5  1  1  1  —  —  —  —  8 
Total Commercial and industrial $ 15,959  $ 6,059  $ 4,114  $ 2,273  $ 1,243  $ 1,374  $ 10,663  $ 3  $ 41,688 
Commercial real estate
Credit Quality Indicator (1):
Pass $ 4,144  $ 2,367  $ 2,593  $ 1,456  $ 761  $ 1,124  $ 798  $ —  $ 13,243 
OLEM 76  48  42  83  73  19  —  —  341 
Substandard 224  362  448  115  151  46  30  —  1,376 
Doubtful —  —  —  1  —  —  —  —  1 
Total Commercial real estate $ 4,444  $ 2,777  $ 3,083  $ 1,655  $ 985  $ 1,189  $ 828  $ —  $ 14,961 
Lease financing
Credit Quality Indicator (1):
Pass $ 1,851  $ 1,441  $ 809  $ 417  $ 226  $ 131  $ —  $ —  $ 4,875 
OLEM 8  32  12  4  2  —  —  —  58 
Substandard 6  23  19  2  9  8  —  —  67 
Total Lease financing $ 1,865  $ 1,496  $ 840  $ 423  $ 237  $ 139  $ —  $ —  $ 5,000 
Residential mortgage
Credit Quality Indicator (2):
750+ $ 5,532  $ 3,857  $ 978  $ 554  $ 687  $ 1,704  $ —  $ —  $ 13,312 
650-749 1,862  993  409  269  254  1,028  —  —  4,815 
<650 48  56  104  120  99  532  —  —  959 
Total Residential mortgage $ 7,442  $ 4,906  $ 1,491  $ 943  $ 1,040  $ 3,264  $ —  $ —  $ 19,086 
Automobile
Credit Quality Indicator (2):
750+ $ 2,993  $ 1,927  $ 1,381  $ 666  $ 345  $ 129  $ —  $ —  $ 7,441 
650-749 2,393  1,237  736  380  168  55  —  —  4,969 
<650 380  234  178  128  70  34  —  —  1,024 
Total Automobile $ 5,766  $ 3,398  $ 2,295  $ 1,174  $ 583  $ 218  $ —  $ —  $ 13,434 
Home equity
Credit Quality Indicator (2):
750+ $ 645  $ 701  $ 32  $ 31  $ 34  $ 387  $ 4,772  $ 272  $ 6,874 
650-749 129  94  15  13  13  161  2,324  324  3,073 
<650 3  2  2  1  1  67  361  165  602 
Total Home equity $ 777  $ 797  $ 49  $ 45  $ 48  $ 615  $ 7,457  $ 761  $ 10,549 
RV and marine
Credit Quality Indicator (2):
750+ $ 1,257  $ 933  $ 470  $ 468  $ 268  $ 319  $ —  $ —  $ 3,715 
650-749 393  273  171  157  106  150  —  —  1,250 
<650 6  11  13  18  18  27  —  —  93 
Total RV and marine $ 1,656  $ 1,217  $ 654  $ 643  $ 392  $ 496  $ —  $ —  $ 5,058 
Other consumer
Credit Quality Indicator (2):
750+ $ 211  $ 34  $ 50  $ 13  $ 10  $ 27  $ 326  $ 3  $ 674 
650-749 88  52  50  23  17  41  295  24  590 
<650 2  2  5  2  —  1  27  17  56 
Total Other consumer $ 301  $ 88  $ 105  $ 38  $ 27  $ 69  $ 648  $ 44  $ 1,320 
(1)Consistent with the credit quality disclosures, indicators for the Commercial portfolio are based on internally defined categories of credit grades which are generally refreshed at least semi-annually.
(2)Consistent with the credit quality disclosures, indicators for the Consumer portfolio are based on updated customer credit scores refreshed at least quarterly.
TDR Loans
TDR Concession Types
The Company’s standards relating to loan modifications consider, among other factors, minimum verified income requirements, cash flow analyses, and collateral valuations. Each potential loan modification is reviewed individually and the terms of the loan are modified to meet a borrower’s specific circumstances at a point in time. All commercial TDRs are reviewed and approved by our FRG.
Following is a description of TDRs by the different loan types:
Commercial loan TDRs – Our strategy involving commercial TDR borrowers includes working with these borrowers to allow them to refinance elsewhere, as well as allow them time to improve their financial position and remain a Huntington customer through refinancing their notes according to market terms and conditions in the future. A subsequent refinancing or modification of a loan may occur when either the loan matures according to the terms of the TDR-modified agreement, or the borrower requests a change to the loan agreements. At that time, the loan is evaluated to determine if the borrower is creditworthy. It is subjected to the normal underwriting standards and processes for other similar credit extensions, both new and existing. The refinanced note is evaluated to determine if it is considered a new loan or a continuation of the prior loan. 
Consumer loan TDRs – Residential mortgage TDRs represent loan modifications associated with traditional first-lien mortgage loans in which a concession has been provided to the borrower. The primary concessions given to residential mortgage borrowers are amortization, maturity date, and interest rate concessions. Residential mortgages identified as TDRs involve borrowers unable to refinance their mortgages through the Company’s normal mortgage origination channels or through other independent sources. Some, but not all, of the loans may be delinquent. The Company may make similar interest rate, term, and principal concessions for Automobile, Home Equity, RV and Marine, and Other Consumer loan TDRs.
TDR Impact on Credit Quality
Huntington’s ALLL is influenced by loan level characteristics that inform the assessed propensity to default. As such, the provision for credit losses is impacted primarily by changes in such loan level characteristics, such as payment performance, rather than the TDR classification. TDRs can be classified as either accrual or nonaccrual loans. Nonaccrual TDRs are included in NALs whereas accruing TDRs are excluded from NALs as it is probable that all contractual principal and interest due under the restructured terms will be collected.
The Company’s TDRs may include multiple concessions and the disclosure classifications are presented based on the primary concession provided to the borrower.
The following table presents, by class and modification type, the number of contracts, post-modification outstanding balance, and the financial effects of the modification.
New Troubled Debt Restructurings (1)
Number of
Contracts		 Post-modification Outstanding Recorded Investment (2)
(dollar amounts in millions) Interest rate concession Amortization or maturity date concession Chapter 7 bankruptcy Other Total
Year Ended December 31, 2022
Commercial and industrial 313  $ 92  $ 62  $ —  $ 15  $ 169 
Commercial real estate 26  62  27  —  —  89 
Residential mortgage 806  —  109  5  —  114 
Automobile 2,368  —  17  3  —  20 
Home equity 228  —  8  4  —  12 
RV and marine 137  —  2  1  —  3 
Other consumer 127  —  —  —  1  1 
Total new TDRs 4,005  $ 154  $ 225  $ 13  $ 16  $ 408 
Year Ended December 31, 2021
Commercial and industrial 76  $ 29  $ 25  $ —  $ —  $ 54 
Commercial real estate 5  —  —  —  —  — 
Residential mortgage 320  —  39  6  —  45 
Automobile 2,442  —  16  4  —  20 
Home equity 214  —  4  7  —  11 
RV and marine 138  1  2  1  —  4 
Other consumer 270  —  —  —  1  1 
Total new TDRs 3,465  $ 30  $ 86  $ 18  $ 1  $ 135 
(1)TDRs may include multiple concessions and the disclosure classifications are based on the primary concession provided to the borrower.
(2)Post-modification balances approximate pre-modification balances.
Pledged Loans
The Bank has access to the Federal Reserve’s discount window and advances from the FHLB. As of December 31, 2022 and 2021, these borrowings and advances are secured by $70.9 billion and $61.1 billion, respectively, of loans.