Huntington Bancshares Incorporated Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

EARNINGS PER SHARE

EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2018

Basic earnings per share is the amount of earnings (adjusted for dividends declared on preferred stock) available to each share of common stock outstanding during the reporting period. Diluted earnings per share is the amount of earnings available to each share of common stock outstanding during the reporting period adjusted to include the effect of potentially dilutive common shares. Potentially dilutive common shares include incremental shares issued for stock options, restricted stock units and awards, distributions from deferred compensation plans, and the conversion of the Company’s convertible preferred stock. Potentially dilutive common shares are excluded from the computation of diluted earnings per share during periods in which the effect would be antidilutive.

On February 22, 2018, Huntington converted all its outstanding 8.50% Series A Non-Cumulative Perpetual Convertible Preferred Stock to 30.3 million shares of common stock. Following the conversion, the additional shares were included in average common shares issued and outstanding. The 2018 total diluted average common shares issued and outstanding was impacted by using the if-converted method. The calculation of basic and diluted earnings per share for the three and nine-month periods ended September 30, 2018 and 2017 was as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
(dollar amounts in millions, share amounts in thousands)	2018			2017			2018			2017
Basic earnings per common share:
Net income	$	378		$	275		$	1,059		$	754
Preferred stock dividends	(18		)	(19		)	(51		)	(57		)
Net income available to common shareholders	$	360		$	256		$	1,008		$	697
Average common shares issued and outstanding	1,084,536			1,086,038			1,090,570			1,087,115
Basic earnings per common share	$	0.33		$	0.24		$	0.92		$	0.64
Diluted earnings per common share:
Net income available to common shareholders	$	360		$	256		$	1,008		$	697
Effect of assumed preferred stock conversion	—			—			—			—
Net income applicable to diluted earnings per share	$	360		$	256		$	1,008		$	697
Average common shares issued and outstanding	1,084,536			1,086,038			1,090,570			1,087,115
Dilutive potential common shares:
Stock options and restricted stock units and awards	15,655			17,079			17,105			17,515
Shares held in deferred compensation plans	3,549			3,228			3,416			3,096
Dilutive impact of Preferred Stock	—			—			5,887			—
Other	—			146			—			152
Dilutive potential common shares	19,204			20,453			26,408			20,763
Total diluted average common shares issued and outstanding	1,103,740			1,106,491			1,116,978			1,107,878
Diluted earnings per common share	$	0.33		$	0.23		$	0.90		$	0.63

There were approximately 1.6 million and 1.5 million of options to purchase shares of common stock outstanding for the three-month periods ended September 30, 2018 and 2017, respectively. There were approximately 2.0 million and 0.9 million of options to purchase shares of common stock outstanding for the nine-month periods ended September 30, 2018 and 2017. These options were not included in the computation of diluted earnings per share because the effect would be antidilutive.