Huntington National Bank 2009 Annual Report Download - page 70

C
RE loan credit qualit
y
data re
g
ardin
g
NCOs, NALs, and accruin
g
loans past due 90 da
y
s or more b
y
i
n
d
ustr
y
c
l
ass
ifi
cat
i
on co
d
e
f
or 2009 an
d
2008 are presente
di
nt
h
e
f
o
ll
ow
i
n
g
ta
bl
e
:
Table 19 — Commercial Real Estate Loans Credit Qualit
y
Data b
y
Pro
p
ert
y
T
yp
e
A
mount Percenta
g
e
A
mount Percenta
g
e
A
moun
t
Net
C
har
g
e-
Off
s Nonaccrual Loan
s
2009 2008 2009 2008
Year Ended December 31
,
At December 31
,
(
In millions
)
Retail
p
ro
p
ertie
s
............
$
250.3 10.51%
$
7.0 0.38
%
$
253.
6
$
78.3
Sin
g
le famil
y
home builde
r
....
212.3 18.7
1
35.0 2.87 262.
4
200.4
O
ffice...................
.
2
9.9
2
.
4
9
1.7
0
.1
5
87.
3
1
9
.
9
Mu
l
t
if
am
ily
...............
77.
1
5.
15
9
.
5
0.8
4
129
.
0
42
.
9
In
d
ustr
i
a
l
an
dw
are
h
ouse
......
53
.
94
.
93
2
.
30
.
24
120.8
20
.
4
Li
nes to rea
l
estate com
p
an
i
es . .
43
.
24
.
68
4
.
60
.4
6
22
.
7
2
6
.
3
Raw
l
an
d
an
d
ot
h
er
l
an
d
uses . .
12
.
6
5.
38
5
.1 0.3
4
42.4
33.
5
Health car
e
................
——
1.
00
.2
7
0.
7
6
.2
H
otel
....................
2.7 0.7
1
—
—
10.
9
0.8
O
t
h
er
....................
0.8 1.68
2.
5
0.9
7
6.1
1
7.
0
To
t
al
......................
$
682.7 7.46%
$
68.7 0.71
%
$
935.
8
$
445.7
We mana
g
et
h
er
i
s
k
s
i
n
h
erent
i
nt
hi
s port
f
o
li
ot
h
rou
gh
or
igi
nat
i
on po
li
c
i
es, concentrat
i
on
li
m
i
ts, on
g
o
i
n
g
loan level reviews, recourse requirements, and continuous portfolio risk mana
g
ement activities. Our ori
g
ination
po
li
c
i
es
f
or t
hi
s port
f
o
li
o
i
nc
l
u
d
e
l
oan pro
d
uct-t
y
pe spec
ifi
cpo
li
c
i
es suc
h
as LTV,
d
e
b
t serv
i
ce covera
g
e rat
i
os,
an
d
pre-
l
eas
i
n
g
requ
i
rements, as app
li
ca
bl
e. Genera
lly
, we: (a)
li
m
i
t our
l
oans to 80% o
f
t
h
e appra
i
se
d
va
l
u
e
of the commercial real estate, (b) require net operatin
g
cash flows to be 125% of required interest an
d
principal pa
y
ments, and (c) if the commercial real estate is non-owner occupied, require that at least
5
0% o
f
t
h
e space o
f
t
h
e pro
j
ect
b
e pre-
l
ease
d
.Wema
y
requ
i
re more conservat
i
ve
l
oan terms,
d
epen
di
n
g
on t
h
e
pro
j
ect
.
Dedicated real estate professionals within our Commercial Real Estate se
g
ment team ori
g
inated th
e
ma
j
orit
y
of the portfolio, with the remainder obtained from prior acquisitions. Appraisals from approved
ven
d
ors are rev
i
ewe
dby
an
i
nterna
l
appra
i
sa
l
rev
i
ew
g
roup to ensure t
h
e qua
li
t
y
o
f
t
h
eva
l
uat
i
on use
di
nt
he
un
d
erwr
i
t
i
n
g
process. T
h
e port
f
o
li
o
i
s
di
vers
ifi
e
dby
pro
j
ect t
y
pe an
dl
oan s
i
ze, an
d
represents a s
ig
n
ifi
can
t
piece of the credit risk mana
g
ement strate
g
ies emplo
y
ed for this portfolio. Our loan review staff provides a
n
assessment of the qualit
y
of the underwritin
g
and structure and validates the risk ratin
g
assi
g
ned to the loan
.
Appraisal values are obtained in con
j
unction with all ori
g
inations and renewals, and on an as needed
b
as
i
s,
i
n comp
li
ance w
i
t
h
re
g
u
l
ator
y
requ
i
rements. G
i
ven t
h
e stresse
d
env
i
ronment
f
or some
l
oan t
y
pes, w
e
h
ave
i
n
i
t
i
ate
d
on
g
o
i
n
g
port
f
o
li
o
l
eve
l
rev
i
ews o
f
se
g
ments suc
h
as s
i
n
gl
e
f
am
ily h
ome
b
u
ild
ers an
d
reta
il
p
ro
p
ertie
s
(see “Sin
g
le Famil
y
Home Builders” and “Retail Properties” discussions). These reviews
g
enerate
action plans based on occupanc
y
levels or sales volume associated with the pro
j
ects bein
g
reviewed. Th
e
resu
l
ts o
f
t
h
ese act
i
ons
i
n
di
cate
d
t
h
at a
ddi
t
i
ona
l
stress
i
s
lik
e
ly d
ue to t
h
e current econom
i
c con
di
t
i
ons
.
Propert
y
values are updated usin
g
appraisals on a re
g
ular basis to ensure that appropriate decisions re
g
ardin
g
the on
g
oin
g
mana
g
ement of the portfolio reflect the chan
g
in
g
market conditions. This hi
g
hl
y
individualized
process requ
i
res wor
ki
n
g
c
l
ose
ly
w
i
t
h
a
ll
o
f
our
b
orrowers as we
ll
as an
i
n-
d
ept
hk
now
l
e
dg
eo
f
CRE pro
j
ec
t
l
en
di
n
g
an
d
t
h
e mar
k
et env
i
ronment.
A
tt
h
e port
f
o
li
o
l
eve
l
, we act
i
ve
ly
mon
i
tor t
h
e concentrat
i
ons an
d
per
f
ormance metr
i
cs o
f
a
ll l
oan t
y
pes
,
w
i
t
h
a
f
ocus on
high
er r
i
s
k
se
g
ments. Macro-
l
eve
l
stress-test scenar
i
os
b
ase
d
on reta
il
sa
l
es an
dh
ome-pr
i
c
e
depreciation trends for the se
g
ments are embedded in our performance expectations, and lease-up an
d
a
b
sor
p
t
i
on scenar
i
os are assesse
d
. We ant
i
c
ip
ate t
h
e current stress w
i
t
hi
nt
hi
s
p
ort
f
o
li
ow
ill
cont
i
nue
f
or t
he
f
oreseea
bl
e
f
uture, resu
l
t
i
n
gi
ne
l
evate
d
c
h
ar
g
e-o
ff
s, NALs, an
d
ALLL
l
eve
l
s
.
6
2