Huntington National Bank 2004 Annual Report Download - page 52

Download and view the complete annual report

Please find page 52 of the 2004 Huntington National Bank annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 142

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142

MANAGEMENT’S DISCUSSION AND ANALYSIS HUNTINGTON BANCSHARES INCORPORATED
Table 12 — Non-Performing Assets and Past Due Loans and Leases
At December 31,
(in thousands of dollars) 2004 2003 2002 2001 2000
Non-accrual loans and leases:
Middle market commercial and industrial $ 24,179 $ 33,745 $ 79,691 $ 143,140 $ 40,174
Middle market commercial real estate 4,582 18,434 19,875 35,848 17,462
Small business commercial and industrial and commercial real estate 14,601 13,607 19,060 29,009 24,870
Residential mortgage 13,545 9,695 9,443 11,836 10,174
Home equity(1) 7,055 ————
Total non-accrual loans and leases 63,962 75,481 128,069 219,833 92,680
Renegotiated loans —— — 1,276 1,304
Total non-performing loans and leases 63,962 75,481 128,069 221,109 93,984
Other real estate, net:
Residential 8,762 6,918 7,915 4,915 3,641
Commercial(2) 35,844 4,987 739 1,469 7,772
Total other real estate, net 44,606 11,905 8,654 6,384 11,413
Total non-performing assets $108,568 $ 87,386 $ 136,723 $ 227,493 $105,397
Non-performing loans and leases as a % of total loans and leases 0.27% 0.36% 0.69% 1.20% 0.53%
Non-performing assets as a % of total loans and leases and other real estate 0.46 0.41 0.74 1.23 0.60
Allowances for credit losses (ACL) as % of:
Non-performing loans and leases 476 444 263 167 282
Non-performing assets 280 384 246 162 251
Accruing loans and leases past due 90 days or more(1) $ 54,283 $ 55,913 $ 61,526 $ 76,013 $ 66,665
Accruing loans and leases past due 90 days or more as a percent of total
loans and leases 0.23% 0.27% 0.33% 0.41% 0.38%
(1) As of September 30, 2004, the Company adopted a policy, consistent with its policy for residential mortgage loans, of placing home equity loans and lines on non-accrual status when they become
greater than 180 days past due.
(2) At December 31, 2004, other real estate owned included $35.7 million of properties that relate to the work-out of $5.9 million of mezzanine loans. These properties are subject to $29.8 million of
non-recourse debt to another financial institution. Both properties are in contract for sale in the first half of 2005.
Total NPAs were $108.6 million at December 31, 2004, up $21.2 million, or 24%, from $87.4 million at December 31, 2003, but down
21% from $136.7 million at the end of 2002. Expressed as a percent of total loans and leases and other real estate, the year-end
positions for 2004, 2003, and 2002 were 0.46%, 0.41%, and 0.74%, respectively. (See Table 12.)
Table 13 — Non-Performing Asset Activity
Year Ended December 31,
(in thousands of dollars) 2004 2003 2002 2001 2000
Non-performing assets, beginning of period $ 87,386 $ 136,723 $ 227,493 $ 105,397 $ 98,241
New non-performing assets(1)(2) 137,359 222,043 260,229 329,882 112,319
Returns to accruing status (3,795) (16,632) (17,124) (2,767) (5,914)
Loan and lease losses (37,337) (109,905) (152,616) (67,491) (18,052)
Payments (43,319) (83,886) (136,774) (106,889) (67,431)
Sales (31,726) (60,957) (44,485) (30,639) (13,766)
Non-performing assets, end of period $108,568 $ 87,386 $ 136,723 $ 227,493 $105,397
(1) As of September 30, 2004, the Company adopted a policy, consistent with its policy for residential mortgage loans, of placing home equity loans and lines on nonaccrual status when they become
greater than 180 days past due.
(2) At December 31, 2004, other real estate owned included $35.7 million of properties that relate to the work-out of $5.9 million of mezzanine loans. These properties are subject to $29.8 million of
non-recourse debt to another financial institution. Both properties are in contract for sale in the first half of 2005.
All of the increase from the end of 2003 related to the workout of a troubled mezzanine financing relationship. During the 2004
fourth quarter, OREO reflected a $35.7 million increase for properties related to the workout of $5.9 million of non-performing
mezzanine loans to a real estate partnership as the Company took ownership of the partnership, which required consolidation of the
partnership’s assets and liabilities including these properties. These properties are subject to $29.8 million of non-recourse debt to
another financial institution, and are in contract for sale early in 2005 at their current book value.
The decline in 2003 from the end of 2002, reflected success at aggressively exiting troubled and lower credit quality C&I and CRE credits.
50