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Huntington reports 3Q decrease from acquisition expenses

Thursday, October 27, 2016

Staff report


Acquisition expenses led to a decrease in third-quarter earnings for Columbus-based Huntington Bank.

The bank reported Wednesday earnings of $127 million in the third quarter, a 17 percent decrease from the same quarter in 2015.

The quarter included $159 million in costs associated with the completed acquisition of FirstMerit.

“We are very excited about the third-quarter acquisition of FirstMerit, which has strengthened the return profile of the company,” said Steve Steinour, chairman, president and chief executive officer, in a statement. “We delivered solid core fundamental performance for the quarter.”

Huntington announced the acquisition with FirstMerit in January. The total transaction was valued at $3.4 billion. The acquisition of FirstMerit added about $26.8 billion of total assets, $15.5 billion of total loans and leases, $21.2 billion of total deposits and nearly 1,000 branch locations across the states of Ohio, Illinois, Indiana, Kentucky, Michigan, Pennsylvania, West Virginia and Wisconsin to Huntington.

The FirstMerit branches will convert to Huntington branches during the first quarter of 2017. Thirteen FirstMerit branches – 11 in Stark County and two in Ashtabula County – will be sold to First Commonwealth Bank during the fourth quarter this year. Akron-based FirstMerit had 366 banking offices in Ohio, Michigan, Wisconsin and Pennsylvania. A total of 102 FirstMerit locations were consolidated, and Huntington plans to integrate 225 former FirstMerit branches in February. There are no FirstMerit locations in the Mahoning Valley.

In the third quarter, Huntington reported a $182 million, or a 24 percent, year-over-year increase in fully-taxable equivalent revenue, to $938 million from the $757 million reported in the third quarter of 2015. The FirstMerit acquisition also led to this major increase for the bank.

Loans and leases increased 24 percent year over year to $60.7 billion. The increase was primarily driven by a $5.2 billion, or 26 percent, increase in commercial and industrial and a $2.5 billion, or 28 percent, increase in automobile loans.

The bank again attained the national rank of second-highest SBA 7(a) lender by number of loans while remaining No. 1 in both total SBA 7(a) loans and dollars lent in our combined geography of Ohio, Indiana, Kentucky, Michigan, Pennsylvania and West Virginia.

Core deposits increased 22 percent year over year to $62 billion.

Huntington executives noted in the earnings release the institution was named by Money Magazine on Wednesday as the “Best Regional Bank in the Great Lakes.”