Huntington National Bank 2010 Annual Report Download - page 146

Huntington Bancshares Incorporated
Notes to Consolidated Financial Statements
1. SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations — Huntington Bancshares Incorporated (Huntington or the Company) is a multi-
state diversified financial holding company organized under Maryland law in 1966 and headquartered in
Columbus, Ohio. Through its subsidiaries, including its bank subsidiary, The Huntington National Bank (the
Bank), Huntington is engaged in providing full-service commercial, small business, and consumer banking
services, mortgage banking services, automobile financing, equipment leasing, investment management, trust
services, brokerage services, customized insurance service programs, and other financial products and services.
Huntington’s banking offices are located in Ohio, Michigan, Pennsylvania, Indiana, West Virginia, and
Kentucky. Select financial services and other activities are also conducted in various states. International
banking services are available through the headquarters office in Columbus and a limited purpose office
located in Cayman Islands and another in Hong Kong.
Basis of Presentation — The Consolidated Financial Statements include the accounts of Huntington and
its majority-owned subsidiaries and are presented in accordance with GAAP. All intercompany transactions
and balances have been eliminated in consolidation. Companies in which Huntington holds more than a 50%
voting equity interest or are a VIE in which Huntington has the power to direct the activities of an entity that
most significantly impact the entity’s economic performance or absorbs the majority of expected losses are
consolidated. Huntington evaluates VIEs in which it holds a beneficial interest for consolidation. VIEs are
legal entities with insubstantial equity, whose equity investors lack the ability to make decisions about the
entity’s activities, or whose equity investors do not have the right to receive the residual returns of the entity if
they occur. VIEs in which Huntington does not hold the power to direct the activities entity that most
significantly impact the entity’s economic performance or absorb the majority of expected losses are not
consolidated. For consolidated entities where Huntington holds less than a 100% interest, Huntington
recognizes minority interest liability (included in shareholders’ equity) for the equity held by others and
minority interest expense (included in noninterest expense) for the portion of the entity’s earnings attributable
to minority interests. Investments in companies that are not consolidated are accounted for using the equity
method when Huntington has the ability to exert significant influence. Those investments in nonmarketable
securities for which Huntington does not have the ability to exert significant influence are generally accounted
for using the cost method and are periodically evaluated for impairment. Investments in private investment
partnerships that are accounted for under the equity method or the cost method are included in accrued income
and other assets and Huntington’s proportional interest in the equity investments’ earnings are included in
other noninterest income.
The preparation of financial statements in conformity with GAAP requires Management to make
estimates and assumptions that significantly affect amounts reported in the Consolidated Financial Statements.
Huntington uses significant estimates and employs the judgments of Management in determining the amount
of its allowance for credit losses and income tax accruals and deferrals, in its fair value measurements of
investment securities, derivatives, mortgage loans held for sale, MSRs, certain loans and debt carried at fair
value, and in the evaluation of impairment of loans, goodwill, investment securities, and fixed assets. As with
any estimate, actual results could differ from those estimates. Significant estimates are further discussed in the
critical accounting policies included in Management’s Discussion and Analysis of Financial Condition and
Results of Operations.
In preparing these Consolidated Financial Statements, subsequent events were evaluated through the time
the financial statements were issued. Financial statements are considered issued when they are widely
distributed to all shareholders and other financial statement users, or filed with the SEC. In conjunction with
applicable accounting standards, all material subsequent events have been either recognized in the Consoli-
dated Financial Statements or disclosed in the Notes to the Consolidated Financial Statements.
Certain prior period amounts have been reclassified to conform to the current year’s presentation.
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