Huntington National Bank 2009 Annual Report Download - page 209

portfolios as part of overall liquidit
y
mana
g
ement. A match-funded transfer pricin
g
(FTP) s
y
stem is used t
o
attribute appropriate fundin
g
interest income and interest expense to other business se
g
ments. As such, net
interest income includes the net impact of an
y
over or under allocations arisin
g
from centralized mana
g
ement
of interest rate risk. Furthermore, net interest income includes the net impact of derivatives used to hed
ge
i
nterest rate sens
i
t
i
v
i
t
y
. Non-
i
nterest
i
ncome
i
nc
l
u
d
es m
i
sce
ll
aneous
f
ee
i
ncome not a
ll
ocate
d
to ot
h
er
b
us
i
ness
se
g
ments,
i
nc
l
u
di
n
gb
an
k
owne
d lif
e
i
nsurance
i
ncome. Fee
i
ncome a
l
so
i
nc
l
u
d
es asset reva
l
uat
i
ons no
t
allocated to business se
g
ments, as well as an
y
investment securities and tradin
g
assets
g
ains or losses. Th
e
non-
i
nterest expense
i
nc
l
u
d
es certa
i
n corporate a
d
m
i
n
i
strat
i
ve, mer
g
er costs, an
d
ot
h
er m
i
sce
ll
aneous expense
s
not a
ll
ocate
d
to
b
us
i
ness se
g
ments. T
hi
s
g
roup a
l
so
i
nc
l
u
d
es an
y diff
erence
b
etween t
h
e actua
l
e
ff
ect
i
ve tax
rate o
f
Hunt
i
n
g
ton an
d
t
h
e statutor
y
tax rate use
d
to a
ll
ocate
i
ncome taxes to t
h
eot
h
er se
g
ments
.
In 2009, a compre
h
ens
i
ve rev
i
ew o
f
t
h
e FTP met
h
o
d
o
l
o
gy
resu
l
te
di
nc
h
an
g
es to var
i
ous assumpt
i
ons,
includin
g
liquidit
y
premiums. Business se
g
ment financial performance for 2009 reflect the methodolo
gy
c
h
an
g
es,
h
owever,
fi
nanc
i
a
l
per
f
ormance
f
or 2008 was not restate
d
to re
fl
ect t
h
ese c
h
an
g
es, as t
h
ec
h
an
g
es
f
o
r
t
h
at
y
ear were not mater
i
a
l
. As a resu
l
to
f
t
hi
sc
h
an
g
e,
b
us
i
ness se
g
ment per
f
ormance
f
or net
i
nterest
i
ncom
e
com
p
arisons between 2009 and 2008 are affected
.
Th
e mana
g
ement account
i
n
g
process use
d
to
d
eve
l
op t
h
e
b
us
i
ness se
g
ment report
i
n
g
ut
ili
ze
d
var
i
ou
s
estimates and allocation methodolo
g
ies to measure the performance of the business se
g
ments. Durin
g
2009,
Hunt
i
n
g
ton
i
mp
l
emente
d
a
f
u
ll
-a
ll
ocat
i
on met
h
o
d
o
l
o
gy
,w
h
ere a
ll
Treasur
y
/Ot
h
er expenses, except t
h
ose
re
l
ate
d
to serv
i
c
i
n
g
Fran
kli
n assets, reporte
d
“S
ig
n
ifi
cant Items” (exc
l
u
di
n
g
t
h
e
g
oo
d
w
ill i
mpa
i
rment), an
da
small residual of other unallocated expenses, are allocated to the other five business se
g
ments. Prior to this
implementation, onl
y
certain expenses were allocated to the five business se
g
ments. Business se
g
ment financia
l
p
er
f
ormance
f
or 2009 re
fl
ect t
h
e
i
m
pl
ementat
i
on,
h
owever,
fi
nanc
i
a
lp
er
f
ormance
f
or 2008 was not restate
d
t
o
re
fl
ect t
h
ese c
h
an
g
es, as t
h
e met
h
o
d
o
l
o
gy i
np
l
ace at t
h
at t
i
me was appropr
i
ate. As a resu
l
to
f
t
hi
sc
h
an
g
e
,
business se
g
ment performance comparisons for noninterest expense between 2009 and 2008 are affected.
201