Quarterly report pursuant to Section 13 or 15(d)

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

v3.22.2.2
DERIVATIVE FINANCIAL INSTRUMENTS (Tables)
9 Months Ended
Sep. 30, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Asset and liability derivatives included in accrued income and other assets
The following table presents the fair values and notional values of all derivative instruments included in the Unaudited Condensed Consolidated Balance Sheets at September 30, 2022 and December 31, 2021. Amounts in the table below are presented gross without the impact of any net collateral arrangements.
September 30, 2022 December 31, 2021
(dollar amounts in millions) Notional Value Asset Liability Notional Value Asset Liability
Derivatives designated as Hedging Instruments
Interest rate contracts $ 38,351  $ 1,036  $ 1,205  $ 21,306  $ 258  $ 32 
Foreign exchange contracts 206  —  13  210  — 
Derivatives not designated as Hedging Instruments
Interest rate contracts 39,835  1,188  1,181  45,286  587  498 
Foreign exchange contracts 4,483  98  64  3,524  29  31 
Commodities contracts 1,045  201  198  1,077  178  177 
Equity contracts 559  —  685  12 
Total Contracts $ 84,479  $ 2,523  $ 2,663  $ 72,088  $ 1,065  $ 743 
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, 2022 and 2021, respectively.
Location of Gain or (Loss) Recognized in Income
on Derivative
Amount of Gain or (Loss) Recognized in Income on Derivative
Three Months Ended
September 30,
Nine Months Ended
September 30,
(dollar amounts in millions) 2022 2021 2022 2021
Interest rate contracts:
Customer Capital markets fees $ 12  $ 13  $ 37  $ 37 
Mortgage banking Mortgage banking income —  (80) (24)
Interest rate floors Interest and fee income on loans and leases —  (4) —  (8)
Interest rate caps Interest expense on long-term debt —  —  —  89 
Foreign exchange contracts Capital markets fees 12  32  22 
Commodities contracts Capital markets fees (1) (1)
Equity contracts Other noninterest expense (1) (2) (4) (6)
Total $ 24  $ 20  $ (11) $ 109 
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, 2022 and December 31, 2021, identified by the underlying interest rate-sensitive instruments.
September 30, 2022
(dollar amounts in millions) Fair Value Hedges Cash Flow Hedges Economic Hedges Total
Instruments associated with:
Investment securities $ 10,297  $ —  $ —  $ 10,297 
Loans —  22,325  271  22,596 
Long-term debt 5,729  —  —  5,729 
Total notional value at September 30, 2022 $ 16,026  $ 22,325  $ 271  $ 38,622 
December 31, 2021
(dollar amounts in millions) Fair Value Hedges Cash Flow Hedges Economic Hedges Total
Instruments associated with:
Investment securities $ 8,228  $ —  $ —  $ 8,228 
Loans —  11,150  271  11,421 
Long-term debt 1,928  —  —  1,928 
Total notional value at December 31, 2021 $ 10,156  $ 11,150  $ 271  $ 21,577 
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, 2022 and 2021.
Three Months Ended
September 30,
Nine Months Ended
September 30,
(dollar amounts in millions) 2022 2021 2022 2021
Interest rate contracts
Change in fair value of interest rate swaps hedging investment securities (1) $ 340  $ $ 926  $ 39 
Change in fair value of hedged investment securities (1) (324) —  (914) (40)
Change in fair value of interest rate swaps hedging long-term debt (2) (178) (22) (314) (95)
Change in fair value of hedged long term debt (2) 178  22  315  96 
(1)Recognized in Interest income—available-for-sale securities—taxable in the Unaudited Condensed Consolidated Statements of Income.
(2)Recognized in Interest expense—long-term debt in the Unaudited Condensed Consolidated Statements of Income.
Amounts recorded on the balance sheet related to cumulative basis adjustments
As of September 30, 2022, and December 31, 2021, the following amounts were recorded on the balance sheet related to cumulative basis adjustments for fair value hedges.
Amortized Cost Cumulative Amount of Fair Value Hedging Adjustment To Hedged Items
(dollar amounts in millions) September 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021
Assets
Investment securities (1) $ 18,026  $ 17,150  $ (1,032) $ (117)
Liabilities
Long-term debt (2) 4,095  1,981  (271) 45 
(1)Amounts include the amortized cost basis of closed portfolios used to designate hedging relationships under the portfolio layer method. The hedged item is a layer of the closed portfolio which is expected to be remaining at the end of the hedging relationship. As of September 30, 2022, the amortized cost basis of the closed portfolios used in these hedging relationships was $17.2 billion, the cumulative basis adjustments associated with these hedging relationships was $892 million, and the amounts of the designated hedging instruments were $9.4 billion.
(2)Excluded from the above table are the cumulative amount of fair value hedge adjustments remaining for long-term debt for which hedge accounting has been discontinued in the amounts of $(69) million at September 30, 2022 and $17 million at December 31, 2021.
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, 2022 and December 31, 2021.

Offsetting of Financial Assets and Derivative Assets
Gross amounts
offset in the unaudited
condensed
consolidated
balance sheets
Net amounts of
assets
presented in
the unaudited condensed
consolidated
balance sheets
Gross amounts not offset in the
unaudited condensed consolidated
balance sheets
(dollar amounts in millions)
Gross amounts
of recognized
assets
Financial
instruments
Cash collateral
received
Net amount
September 30, 2022 $ 2,523  $ (2,104) $ 419  $ (6) $ (121) $ 292 
December 31, 2021 1,065  (465) 600  (65) (31) 504 
MSR Derivative Hedging The notional value of the derivative financial instruments, the corresponding trading assets and liabilities positions, and net trading gains (losses) related to MSR hedging activity is summarized in the following table:
(dollar amounts in millions) September 30,
2022
December 31,
2021
Notional value $ 1,095  $ 1,330 
Trading assets 19 
Trading liabilities (80) — 
Three Months Ended
September 30, 2022
Nine Months Ended
September 30, 2022
(dollar amounts in millions) 2022 2021 2022 2021
Trading gains (losses) $ (25) $ (4) $ (105) $ (28)
Offsetting of financial liabilities and derivative liabilities
Offsetting of Financial Liabilities and Derivative Liabilities
Gross amounts
offset in the unaudited
condensed
consolidated
balance sheets
Net amounts of
liabilities
presented in
the unaudited condensed
consolidated
balance sheets
Gross amounts not offset in the
unaudited condensed consolidated
balance sheets
(dollar amounts in millions)
Gross amounts
of recognized
liabilities
Financial
instruments
Cash collateral
delivered
Net amount
September 30, 2022 $ 2,663  $ (1,460) $ 1,203  $ (79) $ (148) $ 976 
December 31, 2021 743  (624) 119  (3) (116) —