Huntington National Bank 2004 Annual Report Download - page 117

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS HUNTINGTON BANCSHARES INCORPORATED
12. SUBORDINATED NOTES
At December 31, Huntington’s subordinated notes consisted of the following:
At December 31,
(in thousands of dollars) 2004 2003
Parent company:
2.86% junior subordinated debentures due 2027(1) $ 206,186 $ 206,186
3.115% junior subordinated debentures due 2028(2) 103,093 103,093
The Huntington National Bank:
Floating rate subordinated notes due 2008 —100,000
8.00% subordinated notes due 2010 160,692 162,769
4.90% subordinated notes due 2014 199,136 198,431
6.60% subordinated notes due 2018 219,505 219,991
5.375% subordinated notes due 2019 151,181 —
Total subordinated notes $1,039,793 $ 990,470
(1) Variable effective rate at December 31, 2004, based on three month LIBOR + 0.70.
(2) Variable effective rate at December 31, 2004, based on three month LIBOR + 0.625.
The Bank issued $100 million of long-term notes in 2002 that were called in the first quarter of 2004. Proceeds from lower rate
subordinated notes issued in the first quarter of 2004 were used to fund the payment of the long-term notes. The weighted-average
interest rate for subordinated notes was 5.16 % at December 31, 2004, and 6.36% at the end of 2003.
Amounts above are reported net of unamortized discounts and include values related to hedging with derivative financial instruments.
The derivative instruments, principally interest rate swaps, are used to match the funding rates on certain assets by hedging the cash
flow variability associated with certain variable-rate debt by converting the debt to fixed-rate and hedging the fair values of certain
fixed-rate debt by converting the debt to a variable rate. See Note 20 for more information regarding such financial instruments. All
principal is due upon maturity of the note as described in the table above.
13. OTHER LONG-TERM DEBT
At December 31, Huntington’s other long-term debt consisted of the following:
At December 31,
(in thousands of dollars) 2004 2003
The Huntington National Bank $3,866,004 $4,394,509
Parent company (maturing in 2005 and interest rate of 2.63%)(1) 100,000 100,000
Class C preferred securities of REIT subsidiary (no maturity and interest rate of 7.88%) 50,000 50,000
Total Other Long-Term Debt $4,016,004 $4,544,509
(1) Variable effective rate at December 31, 2004, of 1.40% plus three-month LIBOR.
Amounts above include values related to hedging with derivative financial instruments. The derivative instruments, principally
interest rate swaps, are used to match the funding rates on certain assets by hedging the cash flow variability associated with certain
variable-rate debt by converting the debt to fixed-rate and hedging the fair values of certain fixed-rate debt by converting the debt to a
variable rate. See Note 20 for more information regarding such financial instruments.
The weighted-average interest rate for other long-term debt at December 31, 2004 and 2003, was 2.86% and 1.67%, respectively. At
December 31, 2004, Huntington’s other long-term debt included $300 million of secured borrowings, which had variable rates based
on three-month LIBOR. At December 31, 2004, these secured borrowings had a remaining average maturity of 0.6 years and a
weighted average cost of 2.24%.
The terms of the other long-term debt obligations contain various restrictive covenants including limitations on the acquisition of
additional debt in excess of specified levels, dividend payments, and the disposition of subsidiaries. As of December 31, 2004,
Huntington was in compliance with all such covenants.
Other long-term debt maturities for the next five years are as follows: $1.5 billion in 2005; $0.8 billion in 2006; $0.1 billion in 2007;
$0.2 billion in 2008; $0.2 billion in 2009; and $1.2 billion in 2010 and thereafter.
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