DERIVATIVE FINANCIAL INSTRUMENTS (Tables)
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9 Months Ended |
Sep. 30, 2018 |
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] |
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| Asset and liability derivatives included in accrued income and other assets |
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September 30, 2018 |
December 31, 2017 |
(dollar amounts in millions) |
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 |
$ |
15 |
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$ |
65 |
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$ |
22 |
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$ |
121 |
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Derivatives not designated as Hedging Instruments |
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Interest rate contracts |
294 |
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198 |
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187 |
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100 |
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Foreign exchange contracts |
28 |
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22 |
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18 |
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18 |
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Commodities contracts |
157 |
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152 |
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92 |
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87 |
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Equity contracts |
4 |
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4 |
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3 |
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5 |
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Total Contracts |
$ |
498 |
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$ |
441 |
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$ |
322 |
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$ |
331 |
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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 amount of gain or loss recognized in income for derivatives not designated as hedging instruments under ASC Subtopic 815-10 in the Unaudited Condensed Consolidated Income Statement for the three-month and nine-month periods ended September 30, 2018.
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Location of Gain or (Loss) Recognized in Income on Derivative |
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Amount of Gain or (Loss) Recognized in Income on Derivative |
(dollar amounts in millions) |
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Three Months Ended September 30, 2018 |
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Nine Months Ended September 30, 2018 |
Interest rate contracts: |
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Customer |
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Capital markets fees |
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$ |
11 |
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$ |
30 |
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Mortgage Banking |
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Mortgage banking income |
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5 |
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(3 |
) |
Foreign exchange contracts |
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Capital markets fees |
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6 |
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18 |
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Commodities contracts |
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Capital markets fees |
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1 |
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3 |
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Equity contracts |
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Other noninterest expense |
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— |
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3 |
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Total |
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$ |
23 |
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$ |
51 |
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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, 2018 and December 31, 2017, identified by the underlying interest rate-sensitive instruments.
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September 30, 2018 |
(dollar amounts in millions) |
Fair Value Hedges |
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Cash Flow Hedges |
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Total |
Instruments associated with: |
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Investment securities |
— |
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$ |
12 |
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$ |
12 |
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Subordinated notes |
375 |
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— |
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375 |
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Long-term debt |
5,340 |
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— |
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5,340 |
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Total notional value at September 30, 2018 |
$ |
5,715 |
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$ |
12 |
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$ |
5,727 |
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December 31, 2017 |
(dollar amounts in millions) |
Fair Value Hedges |
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Cash Flow Hedges |
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Total |
Instruments associated with: |
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Subordinated notes |
$ |
950 |
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— |
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$ |
950 |
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Long-term debt |
7,425 |
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— |
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7,425 |
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Total notional value at December 31, 2017 |
$ |
8,375 |
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$ |
— |
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$ |
8,375 |
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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, 2018 and December 31, 2017.
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September 30, 2018 |
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Weighted-Average Rate |
(dollar amounts in millions) |
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 |
$ |
12 |
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1.5 |
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$ |
— |
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2.20 |
% |
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2.16 |
% |
Liability conversion swaps |
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Receive fixed—generic |
5,715 |
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2.5 |
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(50 |
) |
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2.08 |
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2.26 |
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Total swap portfolio at September 30, 2018 |
$ |
5,727 |
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2.5 |
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$ |
(50 |
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December 31, 2017 |
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Weighted-Average Rate |
(dollar amounts in millions) |
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 |
Liability conversion swaps |
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Receive fixed—generic |
$ |
8,375 |
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2.5 |
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$ |
(99 |
) |
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1.56 |
% |
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1.44 |
% |
Total swap portfolio at December 31, 2017 |
$ |
8,375 |
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2.5 |
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$ |
(99 |
) |
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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, 2018 and 2017.
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Three Months Ended
September 30, |
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Nine Months Ended
September 30, |
(dollar amounts in millions) |
2018 |
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2017 |
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2018 |
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2017 |
Interest rate contracts |
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Change in fair value of interest rate swaps hedging subordinated notes (1) |
$ |
(2 |
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$ |
(2 |
) |
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$ |
22 |
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$ |
(5 |
) |
Change in fair value of hedged subordinated notes (1) |
2 |
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4 |
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(22 |
) |
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7 |
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Change in fair value of interest rate swaps hedging other long-term debt (1) |
(9 |
) |
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(6 |
) |
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33 |
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(1 |
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Change in fair value of hedged other long-term debt (1) |
10 |
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7 |
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(27 |
) |
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(1 |
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(1) |
Recognized in Interest expense—subordinated notes and other long-term debt in the Unaudited Condensed Consolidated Statements of Income. |
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| Amounts recorded on the balance sheet related to cumulative basis adjustments |
As of September 30, 2018, the following amounts were recorded on the balance sheet related to cumulative basis adjustments for fair value hedges.
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Carrying Amount of the Hedged Liabilities |
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Cumulative Amount of Fair Value Hedging Adjustment To Hedged Liabilities |
(dollar amounts in millions) |
September 30, 2018 |
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September 30, 2018 |
Long-term debt |
$ |
5,637 |
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$ |
(67 |
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The cumulative amount of fair value hedging adjustments remaining for any hedged assets and liabilities for which hedge accounting has been discontinued is $(135) million at September 30, 2018.
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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, 2018 and December 31, 2017.
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Offsetting of Financial Assets 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 millions) |
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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, 2018 |
Derivatives |
$ |
498 |
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$ |
(318 |
) |
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$ |
180 |
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$ |
(2 |
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$ |
(59 |
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$ |
119 |
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December 31, 2017 |
Derivatives |
322 |
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(190 |
) |
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132 |
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(11 |
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(18 |
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103 |
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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 millions) |
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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, 2018 |
Derivatives |
$ |
441 |
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$ |
(221 |
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$ |
220 |
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$ |
— |
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$ |
(15 |
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$ |
205 |
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December 31, 2017 |
Derivatives |
331 |
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(245 |
) |
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86 |
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— |
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(21 |
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65 |
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