Huntington National Bank 2003 Annual Report Download - page 37

MANAGEMENT’S DISCUSSION AND ANALYSIS
Management’s Discussion and Analysis of Financial Condition and Results of Operations
INTRODUCTION
Huntington Bancshares Incorporated (Huntington or the company) is a multi-state diversified financial holding company organized
under Maryland law in 1966 and headquartered in Columbus, Ohio. Through its subsidiaries, Huntington is engaged in providing full-
service commercial and consumer banking services, mortgage banking services, automobile financing, equipment leasing, investment
management, trust services, and discount brokerage services, as well as underwriting credit life and disability insurance, and selling
other insurance and financial products and services. Huntington’s banking offices are located in Ohio, Michigan, West Virginia,
Indiana, and Kentucky. Selected financial services are also conducted in other states including Arizona, Florida, Georgia, Maryland,
New Jersey, Pennsylvania, and Tennessee. Huntington has a foreign office in the Cayman Islands and a foreign office in Hong Kong.
The Huntington National Bank (the Bank), organized in 1866, is Huntington’s only bank subsidiary.
The following discussion and analysis provides investors and others with information that Management believes to be necessary for an
understanding of Huntington’s financial condition, changes in financial condition, results of operations, and cash flows, and should be
read in conjunction with the financial statements, notes, and other information contained in this report.
F
ORWARD -L OOKING S TATEMENTS
This report, including Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains forward-
looking statements about Huntington. These include descriptions of products or services, plans or objectives of Management for future
operations, including pending acquisitions, and forecasts of revenues, earnings, cash flows, or other measures of economic
performance. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts.
By their nature, forward-looking statements are subject to numerous assumptions, risks, and uncertainties. A number of factors could
cause actual conditions, events, or results to differ significantly from those described in the forward-looking statements. These factors
include, but are not limited to, those set forth under the heading “Business Risks” included in Item 1 of Huntington’s Annual Report
on Form 10-K for the year ended December 31, 2003, and other factors described in this report and from time to time in other filings
with the Securities and Exchange Commission.
Management encourages readers of this report to understand forward-looking statements to be strategic objectives rather than
absolute forecasts of future performance. Forward-looking statements speak only as of the date they are made. Huntington does not
update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements were
made or to reflect the occurrence of unanticipated events.
R
ISK F ACTORS
Huntington, like other financial companies, is subject to a number of risks, many of which are outside of Management’s control,
though Management strives to manage those risks while optimizing returns. Among the risks assumed are: (1) credit risk, which is the
risk that loan and lease customers or other counter parties will be unable to perform their contractual obligations, (2) market risk,
which is the risk that changes in market rates and prices will adversely affect Huntington’s financial condition or results of operation,
(3) liquidity risk, which is the risk that Huntington and / or the Bank will have insufficient cash or access to cash to meet operating
needs, and (4) operational risk, which is the risk of loss resulting from inadequate or failed internal processes, people and systems, or
from external events. The description of Huntington’s business contained in Item 1 of its Annual Report on Form 10-K for the year
ended December 31, 2003, while not all inclusive, discusses a number of business risks that, in addition to the other information in this
report, readers should carefully consider.
S
ECURITIES AND E XCHANGE C OMMISSION I NVESTIGATION
On June 26, 2003, Huntington announced that the Securities and Exchange Commission (SEC) staff is conducting a formal
investigation. The SEC investigation began following Huntington’s announcement on April 16, 2003, that it intended to restate its
financial statements in order to reclassify its accounting for automobile leases from the direct financing lease method to the operating
lease method, and following allegations by a former Huntington employee regarding certain aspects of Huntington’s accounting and
HUNTINGTON BANCSHARES INCORPORATED 35