43
Huntington posts revenue increase, net income decrease
By Kalea Hall
YOUNGSTOWN
Huntington Bank on Thursday reported an 11 percent year-over-year decrease in second-quarter earnings due mostly to acquisition expenses.
The Columbus-based bank’s net income for the 2016 second quarter was $175 million, compared with the $196 million it made in the second quarter of 2015.
In January, Huntington and FirstMerit Corp., the parent company of FirstMerit Bank, announced they reached a merger agreement valued at $3.4 billion. The transaction is expected to be completed in the third quarter of 2016.
On Thursday, Huntington reported expenses of $21 million related to the acquisition.
Huntington highlighted an 8 percent increase in loans and leases year over year. Automobile loans alone increased 26 percent, and commercial and industrial loans increased 8 percent.
Average core deposits were up 5 percent. Total revenue increased 1 percent year over year.
Total revenue for the second quarter of 2016 was $787 million, compared with $780 million reported in the second quarter of 2015.
“Given the low interest rate environment, we are very pleased to report revenue growth,” said Mark Muth, senior vice president and director of investor relations for Huntington Bank. “Luckily, we as a company last year and this year budgeted for the Fed not raising interest rates.”
In December 2015, the Fed raised the federal funds rate for the first time in nearly a decade from a range of 0 percent to 0.25 percent to a range of 0.25 percent to 0.50 percent.
Muth said Huntington assumes the Fed will not raise rates this year.
“If they do, it is just a positive for us,” he said.
Huntington also recently released its “Economic Outlook,” showing an improved economy in the second quarter.
Real gross domestic product, GDP, is expected to grow by 3 percent largely because of an acceleration in consumer spending.