Huntington National Bank 2008 Annual Report Download - page 95

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In October 2008, the FASB issued FSP 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset Is
Not Active.” This FSP addresses application issues related to Statement No. 157, Fair Value Measurements, in determining the fair
value of a financial asset when the market for that financial asset is not active. The fair value of these securities has been
calculated using a discounted cash flow model and market liquidity premiums as permitted by the FSP (see Note 19).
–FASB STATEMENT NO. 159,
The Fair Value Option for Financial Assets and Financial Liabilitie
s (Statement No. 159) —In
February 2007, the FASB issued Statement No. 159. This Statement permits entities to choose to measure certain financial assets
and financial liabilities at fair value. This Statement is effective for fiscal years beginning after November 15, 2007. Huntington
adopted Statement No. 159, effective January 1, 2008. The impact of this new pronouncement was not material to Huntington’s
consolidated financial statements (see Consolidated Statements of Changes in Shareholders’ Equity and Note 19).
–FSP FIN 39-1,
Amendment of FASB Interpretation No. 39
(FSP 39-1) — In April 2007, the FASB issued FSP 39-1,
Amendment of FASB Interpretation No. 39, Offsetting of Amounts Related to Certain Contracts. FSP 39-1 permits entities to offset
fair value amounts recognized for multiple derivative instruments executed with the same counterparty under a master netting
agreement. FSP 39-1 clarifies that the fair value amounts recognized for the right to reclaim cash collateral, or the obligation to
return cash collateral, arising from the same master netting arrangement, should also be offset against the fair value of the
related derivative instruments. The Company has historically presented all of its derivative positions and related collateral on a
gross basis.
Effective January 1, 2008, the Company adopted a net presentation for derivative positions and related collateral entered into
under master netting agreements pursuant to the guidance in FIN 39 and FSP 39-1. The adoption of this guidance resulted in
balance sheet reclassifications of certain cash collateral-based short-term investments against the related derivative liabilities and
certain deposit liability balances against the related fair values of derivative assets. The effects of these reclassifications will
fluctuate based on the fair values of the derivative contracts but overall are not expected to have a material impact on either
total assets or total liabilities. The adoption of this presentation change did not have an impact on stockholders’ equity, results
of operations, or liquidity.
–SECURITIES AND EXCHANGE COMMISSION (SEC) STAFF ACCOUNTING BULLETIN NO. 109,
Written Loan Commitments Recorded at Fair
Value Through Earnings
(SAB 109) — In November 2007, the SEC issued SAB 109. SAB 109 provides the staff’s views on the
accounting for written loan commitments recorded at fair value. To make the staff ’s views consistent with Statement No. 156,
Accounting for Servicing of Financial Assets, and Statement No. 159, SAB 109 revises and rescinds portions of SAB No. 105,
Application of Accounting Principles to Loan Commitments, and requires that the expected net future cash flows related to the
associated servicing of a loan should be included in the measurement of all written loan commitments that are accounted for at
fair value through earnings. The provisions of SAB 109 are applicable to written loan commitments issued or modified in fiscal
quarters beginning after December 15, 2007. Huntington adopted SAB 109, effective January 1, 2008. The impact of this new
pronouncement was not material to Huntington’s consolidated financial statements.
–FASB STATEMENT NO. 161,
Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB
Statement No. 133
(Statement No. 161) — The FASB issued Statement No. 161 in March 2008. This Statement changes the
disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures
about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are
accounted for under Statement No. 133 and its related interpretations, and (c) how derivative instruments and related hedged
items affect an entity’s financial position, financial performance, and cash flows. This Statement is effective for financial
statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged.
This Statement encourages, but does not require, comparative disclosures for earlier periods at initial adoption. Huntington
early adopted the provisions of Statement No. 161 in the fourth quarter of 2008. The impact of adoption was not material to
Huntington’s consolidated financial statements.
–FASB STATEMENT NO. 162,
The Hierarchy of Generally Accepted Accounting Principles (Statement No. 162)
— Statement
No. 162 identifies the sources of accounting principles and the framework for selecting the principles to be used in the
preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted
accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement became effective on November 15,
2008. The impact of adoption was not material to Huntington’s consolidated financial statements.
–FSP FAS 140-4 AND FIN 46(R)-8,
Disclosures by Public Entities (Enterprises) About Transfers of Financial Assets and
Interests in Variable Interest Entities
— In December 2008, the FASB issued this FSP to amend the disclosure guidance in
Statement No. 140 and Interpretation No. 46 (revised December 2003). The FSP requires public entities to provide additional
disclosures about transfers of financial assets and their involvement with variable interest entities. The FSP is effective for
Huntington at December 31, 2008. Additional disclosures have been provided in Notes 12 and 13.
–FSP EITF 99-20-1,
Amendments to the Impairment and Interest Income Measurement Guidance of EITF Issue
No. 99-20
— In January 2009, the FASB issued FSP EITF 99-20-1 to amend the impairment guidance in EITF Issue No. 99-20
93
Notes to Consolidated Financial Statements Huntington Bancshares Incorporated