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

Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

3 Months Ended

Sep. 30, 2014

Goodwill and Other Intangible Assets [Abstract]

7. Goodwill and Other Intangible Assets

Business segments are based on segment leadership structure, which reflects how segment performance is monitored and assessed. During the 2014 first quarter, we realigned our business segments to drive our ongoing growth and leverage the knowledge of our highly experienced team. We now have five major business segments: Retail and Business Banking, Commercial Banking, Automobile Finance and Commercial Real Estate (AFCRE), Regional Banking and The Huntington Private Client Group (RBHPCG), and Home Lending. A Treasury / Other function includes, along with technology and operations, other unallocated assets, liabilities, revenue, and expense. All periods presented have been reclassified to conform to the current period classification. During the 2014 third quarter, we moved our insurance brokerage business from Treasury / Other to Commercial Banking to align with a change in management responsibilities. Amounts relating to the realignment are disclosed in the table below.

A rollforward of goodwill by business segment for the first nine-month period of 2014 is presented in the table below:

		Retail &
		Business		Commercial							Home		Treasury/	Huntington
(dollar amounts in thousands)		Banking		Banking		AFCRE			RBHPCG		Lending		Other	Consolidated
Balance, beginning of period		$	286,824	$	16,169	$	---	$	98,951	$	---	$	42,324	$	444,268
	Goodwill acquired
	during the period		81,273		---		---		---		---		---		81,273
	Adjustments		---		43,425		---		(8,939)		3,000		(37,486)		---
	Impairment		---		---		---		---		(3,000)		---		(3,000)
Balance, end of period		$	368,097	$	59,594	$	---	$	90,012	$	---	$	4,838	$	522,541

During the 2014 third quarter, Huntington completed the acquisition of 24 Bank of America branches in Michigan and recorded $17.1 million of goodwill. The remaining $64.2 million of goodwill acquired during the period was the result of the Camco Financial acquisition, which was completed on March 1, 2014. For additional information on the acquisitions, see Business Combinations footnote.

Goodwill is not amortized but is evaluated for impairment on an annual basis at October 1 of each year or whenever events or changes in circumstances indicate the carrying value may not be recoverable. As a result of the 2014 first quarter reorganization in our reported business segments, goodwill was reallocated among the business segments. Immediately following the reallocation, impairment of $3.0 million was recorded in the Home Lending reporting segment.

At September 30, 2014 and December 31, 2013, Huntington’s other intangible assets consisted of the following:

			Gross				Net
			Carrying		Accumulated		Carrying
(dollar amounts in thousands)			Amount		Amortization		Value

September 30, 2014
	Core deposit intangible	$	400,058	$	(358,492)	$	41,566
	Customer relationship		107,920		(64,310)		43,610
	Other		25,164		(25,016)		148
Total other intangible assets		$	533,142	$	(447,818)	$	85,324

December 31, 2013
	Core deposit intangible	$	380,249	$	(335,552)	$	44,697
	Customer relationship		106,974		(58,675)		48,299
	Other		25,164		(24,967)		197
Total other intangible assets		$	512,387	$	(419,194)	$	93,193

The estimated amortization expense of other intangible assets for the remainder of 2014 and the next five years is as follows:

(dollar amounts		Amortization
in thousands)		Expense

2014	$	10,390
2015		25,092
2016		11,205
2017		10,050
2018		8,528
2019		7,471

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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