Huntington National Bank 2007 Annual Report Download - page 34

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– $13.2 million, or 46%, increase in mortgage banking income, primarily reflecting a $12.6 million positive impact between
years related to MSR valuation, net of hedge-related trading activity.
– $12.6 million, or 16% ($5.5 million merger-related), increase in trust services income, primarily reflecting (a) $6.5 million,
or 18%, increase in personal trust income, mostly Unizan merger-related, and (b) $3.7 million, or 14%, increase in fees
from Huntington Funds, reflecting 11% fund asset growth.
– $7.0 million, or 16% ($1.0 million Unizan merger-related), increase in other service charges and fees, primarily reflecting a
$5.3 million, or 17%, increase in fees generated by higher debit card volume.
Partially offset by:
– $65.1 million increase in investment securities losses, reflecting the $73.2 million of investment securities impairment and
losses during 2006 as the balance sheet restructuring was completed.
Table 10 — Mortgage Banking Income
(In thousands of dollars) 2007 Amount % 2006 Amount % 2005
Change from 2006 Change from 2005
Twelve Months Ended December 31,
Mortgage Banking Income
Origination and secondary marketing $ 25,965 $ 7,748 42.5% $ 18,217 $(6,717) (26.9)% $ 24,934
Servicing fees 36,012 11,353 46.0 24,659 2,478 11.2 22,181
Amortization of capitalized servicing
(1)
(20,587) (5,443) 35.9 (15,144) 3,215 (17.5) (18,359)
Other mortgage banking income 13,198 3,025 29.7 10,173 1,590 18.5 8,583
Sub-total 54,588 16,683 44.0 37,905 566 1.5 37,339
MSR valuation adjustment
(1)
(16,131) (21,002) N.M. 4,871 500 11.4 4,371
Net trading losses related to MSR hedging (8,653) (7,368) N.M. (1,285) 12,092 (90.4) (13,377)
Total mortgage banking income $ 29,804 $(11,687) (28.2)% $ 41,491 $13,158 46.4% $ 28,333
Capitalized mortgage servicing rights
(2)
$207,894 $ 76,790 58.6% $131,104 $39,845 43.7% $ 91,259
MSR allowance
(2)
———— — 404 N.M. (404)
Total mortgages serviced for others (in millions)
(2)
15,088 6,836 82.8 8,252 976 13.4 7,276
Net Impact of MSR Hedging
MSR valuation adjustment
(1)
$ (16,131) $(21,002) N.M.% $ 4,871 $ 500 11.4% $ 4,371
Net trading losses related to MSR hedging (8,653) (7,368) N.M. (1,285) 12,092 (90.4) (13,377)
Net interest income related to MSR hedging 5,797 5,761 N.M. 36 (1,652) (97.9) 1,688
Net impact of MSR hedging $ (18,987) $(22,609) N.M.% $ 3,622 $10,940 N.M.% $ (7,318)
N.M., not a meaningful value.
(1) The change in fair value for the period represents the MSR valuation adjustment, net of amortization of capitalized servicing.
(2) At period end.
32
MANAGEMENT’S DISCUSSION AND ANALYSIS HUNTINGTON BANCSHARES INCORPORATED