DERIVATIVE FINANCIAL INSTRUMENTS (Tables)
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9 Months Ended |
Sep. 30, 2017 |
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] |
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| Gross notional values of derivatives used in asset and liability management activities |
The following table presents the gross notional values of derivatives used in Huntington’s asset and liability management activities at September 30, 2017 and December 31, 2016, identified by the underlying interest rate-sensitive instruments.
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September 30, 2017 |
(dollar amounts in thousands) |
Fair Value Hedges |
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Cash Flow Hedges |
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Total |
Instruments associated with: |
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Loans |
$ |
— |
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$ |
1,325,000 |
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$ |
1,325,000 |
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Subordinated notes |
950,000 |
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— |
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|
950,000 |
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Long-term debt |
7,425,000 |
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— |
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7,425,000 |
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Total notional value at September 30, 2017 |
$ |
8,375,000 |
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$ |
1,325,000 |
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$ |
9,700,000 |
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December 31, 2016 |
(dollar amounts in thousands) |
Fair Value Hedges |
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Cash Flow Hedges |
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Total |
Instruments associated with: |
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Loans |
$ |
— |
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$ |
3,325,000 |
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$ |
3,325,000 |
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Subordinated notes |
950,000 |
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— |
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|
950,000 |
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Long-term debt |
6,525,000 |
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— |
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6,525,000 |
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Total notional value at December 31, 2016 |
$ |
7,475,000 |
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$ |
3,325,000 |
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$ |
10,800,000 |
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| Additional information about the interest rate swaps used in asset and liability management activities |
The following table presents additional information about the interest rate swaps used in Huntington’s asset and liability management activities at September 30, 2017 and December 31, 2016.
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September 30, 2017 |
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Weighted-Average Rate |
(dollar amounts in thousands) |
Notional Value |
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Average Maturity (years) |
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Fair Value |
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Receive |
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Pay |
Asset conversion swaps |
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Receive fixed—generic |
$ |
1,325,000 |
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0.1 |
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$ |
(1,239 |
) |
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0.72 |
% |
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1.23 |
% |
Liability conversion swaps |
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Receive fixed—generic |
8,375,000 |
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2.8 |
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(59,148 |
) |
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1.56 |
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1.29 |
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Total swap portfolio at September 30, 2017 |
$ |
9,700,000 |
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2.3 |
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$ |
(60,387 |
) |
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December 31, 2016 |
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Weighted-Average Rate |
(dollar amounts in thousands) |
Notional Value |
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Average Maturity (years) |
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Fair Value |
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Receive |
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Pay |
Asset conversion swaps |
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Receive fixed—generic |
$ |
3,325,000 |
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0.6 |
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$ |
(2,060 |
) |
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1.04 |
% |
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0.91 |
% |
Liability conversion swaps |
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Receive fixed—generic |
7,475,000 |
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3.1 |
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(51,496 |
) |
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1.49 |
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0.88 |
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Total swap portfolio at December 31, 2016 |
$ |
10,800,000 |
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2.3 |
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$ |
(53,556 |
) |
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| Asset and liability derivatives included in accrued income and other assets |
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September 30, 2017 |
December 31, 2016 |
(dollar amounts in thousands) |
Asset |
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Liability |
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Asset |
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Liability |
Derivatives designated as Hedging Instruments |
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Interest rate contracts |
$ |
32,837 |
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$ |
93,224 |
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$ |
46,440 |
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$ |
99,996 |
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Derivatives not designated as Hedging Instruments |
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Interest rate contracts (1) |
198,471 |
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112,534 |
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232,653 |
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140,475 |
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Foreign exchange contracts |
22,354 |
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21,020 |
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23,265 |
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19,576 |
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Commodities contracts |
66,133 |
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61,695 |
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108,026 |
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104,328 |
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Equity contracts |
1,031 |
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5,177 |
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9,775 |
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6,272 |
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Total Contracts |
$ |
320,826 |
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$ |
293,650 |
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$ |
420,159 |
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$ |
370,647 |
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| Increase or (decrease) to interest expense for derivatives designated as fair value hedges |
The following table presents the change in fair value for derivatives designated as fair value hedges as well as the offsetting change in fair value on the hedged item for the three-month and nine-month periods ended September 30, 2017 and 2016.
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Three Months Ended
September 30, |
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Nine Months Ended
September 30, |
(dollar amounts in thousands) |
2017 |
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2016 |
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2017 |
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2016 |
Interest rate contracts |
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Change in fair value of interest rate swaps hedging deposits (1) |
$ |
— |
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$ |
— |
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$ |
— |
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$ |
(82 |
) |
Change in fair value of hedged deposits (1) |
— |
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— |
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— |
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72 |
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Change in fair value of interest rate swaps hedging subordinated notes (2) |
(2,234 |
) |
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(9,688 |
) |
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(4,665 |
) |
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(2,880 |
) |
Change in fair value of hedged subordinated notes (2) |
3,615 |
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10,400 |
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6,782 |
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3,591 |
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Change in fair value of interest rate swaps hedging other long-term debt (2) |
(6,431 |
) |
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(45,870 |
) |
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(880 |
) |
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37,179 |
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Change in fair value of hedged other long-term debt (2) |
7,152 |
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42,647 |
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(1,226 |
) |
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(38,187 |
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(1) |
Effective portion of the hedging relationship is recognized in Interest expense—deposits in the Unaudited Condensed Consolidated Statements of Income. Any resulting ineffective portion of the hedging relationship is recognized in noninterest income in the Unaudited Condensed Consolidated Statements of Income. |
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(2) |
Effective portion of the hedging relationship is recognized in Interest expense—subordinated notes and other long-term debt in the Unaudited Condensed Consolidated Statements of Income. Any resulting ineffective portion of the hedging relationship is recognized in noninterest income in the Unaudited Condensed Consolidated Statements of Income. |
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| Gains and (losses) recognized in other comprehensive income (loss) (OCI) for derivatives designated as effective cash flow hedges |
The following table presents the gains and (losses) recognized in OCI and the location in the Unaudited Condensed Consolidated Statements of Income of gains and (losses) reclassified from OCI into earnings for derivatives designated as effective cash flow hedges for the three-month and nine-month periods ended September 30, 2017 and 2016.
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Derivatives in cash flow hedging relationships |
Amount of gain or (loss) recognized in OCI on derivatives
(effective portion)
(after-tax)
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Location of gain or (loss) reclassified from
accumulated OCI into earnings (effective portion)
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Amount of (gain) or loss
reclassified from
accumulated OCI into earnings
(effective portion)
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Three Months Ended September 30, |
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Three Months Ended September 30, |
(dollar amounts in thousands) |
2017 |
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2016 |
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2017 |
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2016 |
Interest rate contracts |
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Loans |
$ |
1,225 |
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$ |
(5,311 |
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Interest and fee income - loans and leases |
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$ |
144 |
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$ |
123 |
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Investment Securities |
— |
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— |
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Noninterest income - other income |
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— |
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— |
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Total |
$ |
1,225 |
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$ |
(5,311 |
) |
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$ |
144 |
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$ |
123 |
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Derivatives in cash flow hedging relationships |
Amount of gain or (loss) recognized in OCI on derivatives
(effective portion)
(after-tax)
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Location of gain or (loss) reclassified from
accumulated OCI into earnings (effective portion)
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Amount of (gain) or loss
reclassified from
accumulated OCI into earnings
(effective portion)
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Nine Months Ended September 30, |
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Nine Months Ended September 30, |
(dollar amounts in thousands) |
2017 |
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2016 |
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2017 |
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2016 |
Interest rate contracts |
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Loans |
$ |
828 |
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$ |
5,231 |
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Interest and fee income - loans and leases |
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$ |
1,131 |
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$ |
(770 |
) |
Investment Securities |
— |
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— |
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Noninterest income - other income |
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— |
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1 |
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$ |
828 |
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$ |
5,231 |
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$ |
1,131 |
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$ |
(769 |
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| Gains and (losses) recognized in noninterest income on the ineffective portion on interest rate contracts for derivatives designated as fair value and cash flow hedges |
The following table presents the gains and (losses) recognized in noninterest income for the ineffective portion of interest rate contracts for derivatives designated as cash flow hedges for the three and nine-month periods ended September 30, 2017 and 2016.
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Derivatives in cash flow hedging relationships |
Three Months Ended
September 30, |
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Nine Months Ended
September 30, |
(dollar amounts in thousands) |
2017 |
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2016 |
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2017 |
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2016 |
Interest rate contracts |
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Loans |
$ |
359 |
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$ |
(371 |
) |
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$ |
225 |
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$ |
6 |
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| Derivative assets and liabilities used in mortgage banking activities [Table Text Block] |
The following table summarizes the derivative assets and liabilities used in mortgage banking activities:
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Derivatives used in mortgage banking activities |
September 30, 2017 |
December 31, 2016 |
(dollar amounts in thousands) |
Asset |
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Liability |
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Asset |
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Liability |
Interest rate lock agreements |
$ |
8,425 |
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$ |
282 |
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$ |
5,747 |
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$ |
1,598 |
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Forward trades and options |
1,562 |
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1,782 |
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13,319 |
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1,173 |
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Total derivatives used in mortgage banking activities |
$ |
9,987 |
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$ |
2,064 |
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$ |
19,066 |
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$ |
2,771 |
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| Offsetting of financial liabilities and derivative liabilities |
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Offsetting of Financial Liabilities and Derivative Liabilities |
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Gross amounts
offset in the
condensed
consolidated
balance sheets
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Net amounts of
liabilities
presented in
the condensed
consolidated
balance sheets
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Gross amounts not offset in
the condensed consolidated
balance sheets
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(dollar amounts in thousands) |
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Gross amounts
of recognized
liabilities
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Financial
instruments
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Cash collateral
delivered
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Net amount |
September 30, 2017 |
Derivatives |
$ |
293,650 |
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$ |
(234,526 |
) |
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$ |
59,124 |
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$ |
— |
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$ |
(26,766 |
) |
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$ |
32,358 |
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December 31, 2016 |
Derivatives |
370,647 |
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(272,361 |
) |
|
98,286 |
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(7,550 |
) |
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(23,943 |
) |
|
66,793 |
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| Offsetting of financial assets and derivatives assets |
The following tables present the gross amounts of these assets and liabilities with any offsets to arrive at the net amounts recognized in the Unaudited Condensed Consolidated Balance Sheets at September 30, 2017 and December 31, 2016.
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Offsetting of Financial Liabilities and Derivative Assets |
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Gross amounts
offset in the
condensed
consolidated
balance sheets |
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Net amounts of
assets
presented in
the condensed
consolidated
balance sheets |
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Gross amounts not offset in
the condensed consolidated
balance sheets
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(dollar amounts in thousands) |
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Gross amounts
of recognized
assets
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Financial
instruments
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Cash collateral
received
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Net amount |
September 30, 2017 |
Derivatives |
$ |
320,826 |
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$ |
(154,562 |
) |
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$ |
166,264 |
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$ |
(23,350 |
) |
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$ |
(16,895 |
) |
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$ |
126,019 |
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December 31, 2016 |
Derivatives |
420,159 |
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|
(181,940 |
) |
|
238,219 |
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(34,328 |
) |
|
(5,428 |
) |
|
198,463 |
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