Huntington National Bank 2009 Annual Report Download - page 121

C
ommercial Real Estat
e
O
bj
ectives, Strategies, an
d
Prioritie
s
Our Commercial Real Estate se
g
ment serves professional real estate developers or other customers wit
h
rea
l
estate pro
j
ect
fi
nanc
i
n
g
nee
d
sw
i
t
hi
n our pr
i
mar
yb
an
ki
n
g
mar
k
ets. Commerc
i
a
l
Rea
l
Estate pro
d
ucts an
d
serv
i
ces
i
nc
l
u
d
e CRE
l
oans, cas
h
mana
g
ement,
i
nterest rate protect
i
on pro
d
ucts, an
d
cap
i
ta
l
mar
k
et a
l
terna-
tives. Commercial Real Estate bankers personall
y
deliver these products and services b
y
relationships with
developers in our footprint who are reco
g
nized as the most experienced, well-mana
g
ed and well-capitalized
,
an
d
are capa
bl
eo
f
operat
i
n
gi
na
ll
p
h
ases o
f
t
h
e rea
l
estate c
y
c
l
e (“top-t
i
er
d
eve
l
opers”);
l
ea
di
n
g
t
h
rou
gh
commun
i
t
yi
nvo
l
vement; an
d
re
f
erra
l
s
f
rom ot
h
er pro
f
ess
i
ona
l
s
.
T
h
e Commerc
i
a
l
Rea
l
Estate strate
gy i
sto
f
ocus on
b
u
ildi
n
g
a
d
eeper re
l
at
i
ons
hi
pw
i
t
h
top-t
i
er
d
eve
l
oper
s
within our
g
eo
g
raphic footprint. Our local expertise of the customers, market, and products,
g
ives us
a
competitive advanta
g
e and supports revenue
g
rowth in our footprint. Our strate
gy
is to continue to expand th
e
re
l
at
i
ons
hip
so
f
our current customer
b
ase an
d
to attract new,
p
ro
fi
ta
bl
e
b
us
i
ness w
i
t
h
to
p
-t
i
er
d
eve
l
o
p
ers
in
our
f
oot
p
r
i
nt
.
Table 57 — Ke
y
Performance Indicators for Commercial Real Estate
2009 2008
A
m
ou
nt P
e
r
ce
nt 200
7
Chan
g
e from 200
8
(
In thousands unless otherwise noted
)
N
et interest incom
e
......................
$ 134
,
19
0
$202,178 $
(
67,988
)(
34
)
% $147,884
Pro
vi
s
i
on
f
or cre
di
t
l
osse
s
.................
1,0
5
0,
55
4
21
5,5
48 83
5,
006 N.M. 14
5,
13
4
Non
i
nterest
i
ncome
......................
1,613
13,288
(
11,67
5) (
88
)
11,67
5
Non
i
nterest ex
p
ens
e
.....................
36,3
5
7
31
,55
04
,
807 1
5
24
,
31
3
(
Bene
fi
t
)
Prov
i
s
i
on
f
or
i
ncome taxes
.........
(
332
,
888
)
(
11,071
)(
321,817
)
N.M.
(
3,4
6
1
)
Net
(
loss
)
income
.......................
$
(618
,
220
)
$(
20,561
)$(
597,659
)
N.M.%
$(
6,427
)
Tota
l
avera
g
e assets (
i
nm
illi
ons
)
............
$
8
,
10
3
$
7
,
880
$
223 3%
$
4
,
94
4
Tota
l
avera
g
e
l
oans/
l
eases (
i
nm
illi
ons)
.......
8,232
7
,899 333 4 4,890
Total avera
g
e deposits (in millions)
..........
494
55
0
(5
6
)(
10
)5
4
1
Net interest mar
g
in
......................
1.63% 2.57%
(
0.94
)
%
(
37
)
3.03
%
Net c
h
arge-o
ff
s (NCOs)
..................
$
610
,
75
2
$
46
,
884
$
563
,
868 N.M.
$
40
,
88
1
NCOs as a % o
f
avera
g
e
l
oans an
dl
ease
s
.....
7.42
%
0.
59
% 6.83% N.M. 0.84
%
Return on avera
g
e equ
i
t
y
.................
N
.
M.
(4
.7
)
——
(2
.
2)
N.M., not a mean
i
n
gf
u
l
va
l
ue.
2
009 vs. 200
8
Commercial Real Estate re
p
orted a net loss of $618.2 million in 2009, com
p
ared with a net loss of
$
20.6 million in 2008. The decline primaril
y
reflected a
$
835.0 million increase to the provision for credit
l
osses re
fl
ect
i
n
g
: (a) t
h
e cont
i
nue
d
econom
i
c wea
k
nesses
i
n our mar
k
ets, (
b
)an
i
ncrease o
f
commerc
i
a
l
reserves resultin
g
from credit actions taken durin
g
2009 (see “2009 Commercial Loan Port
f
olio Review and
A
ctions” section located within the “Commercial Credit” section
f
or additional in
f
ormation), and
(
c
)a
$
563.9 million increase in NCOs, a
g
ain reflectin
g
the continued impact of the economic conditions on ou
r
commerc
i
a
lb
orrowers. As NALs cont
i
nue
d
to
g
row, we
b
u
il
t our
l
oan
l
oss reserves. NALs
i
ncrease
d
$583 million, reflectin
g
our more conservative approach in identif
y
in
g
and classif
y
in
g
emer
g
in
g
proble
m
cre
di
ts. In man
y
cases, commerc
i
a
ll
oans were p
l
ace
d
on nonaccrua
l
status even t
h
ou
gh
t
h
e
l
oan was
l
ess t
h
an
30
d
a
y
s past
d
ue
f
or
b
ot
h
pr
i
nc
i
pa
l
an
di
nterest pa
y
ments. T
h
e
i
mpact to net
i
ncome resu
l
t
i
n
gf
rom t
he
increase in the provision for credit losses was partiall
y
offset b
y
a $321.8 million reduction in provision fo
r
113