Huntington National Bank 2010 Annual Report Download - page 22

leverage ratio of 5% or greater and is not subject to a regulatory order, agreement, or directive to meet and
maintain a specific capital level for any capital measure.
Well-
Capitalized
Minimums Actual
Excess
Capital(1)
At December 31,
2010
(Dollar amounts in billions)
Ratios:
Tier 1 leverage ratio ....................... Consolidated 5.00% 9.41% $2.4
Bank 5.00 6.97 1.0
Tier 1 risk-based capital ratio ................ Consolidated 6.00 11.55 2.4
Bank 6.00 8.51 1.1
Total risk-based capital ratio ................. Consolidated 10.00 14.46 1.9
Bank 10.00 12.82 1.2
(1) Amount greater than the Well-capitalized minimum percentage.
FDICIA generally prohibits a depository institution from making any capital distribution, including
payment of a cash dividend or paying any management fee to its holding company, if the depository institution
would become Under-capitalized after such payment. Under-capitalized institutions are also subject to growth
limitations and are required by the appropriate federal banking agency to submit a capital restoration plan. If
any depository institution subsidiary of a holding company is required to submit a capital restoration plan, the
holding company would be required to provide a limited guarantee regarding compliance with the plan as a
condition of approval of such plan.
Depending upon the severity of the under capitalization, the Under-capitalized institutions may be subject
to a number of requirements and restrictions, including orders to sell sufficient voting stock to become
Adequately-capitalized, requirements to reduce total assets, cessation of receipt of deposits from correspondent
banks, and restrictions on making any payment of principal or interest on their subordinated debt. Critically
Under-capitalized institutions are subject to appointment of a receiver or conservator within 90 days of
becoming so classified.
Under FDICIA, a depository institution that is not Well-capitalized is generally prohibited from accepting
brokered deposits and offering interest rates on deposits higher than the prevailing rate in its market. Since the
Bank is Well-capitalized, the FDICIA brokered deposit rule did not adversely affect its ability to accept
brokered deposits. The Bank had $1.5 billion of such brokered deposits at December 31, 2010.
Under the Dodd-Frank Act, important changes will be implemented concerning the capital requirements
for financial institutions. The “Collins Amendment” provision of the Dodd-Frank Act imposes increased
capital requirements in the future. The Collins Amendment also requires federal banking regulators to establish
minimum leverage and risk-based capital requirements to apply to insured depository institutions, bank and
thrift holding companies, and systemically important nonbank financial companies. These capital requirements
must not be less than the Generally Applicable Risk-based Capital Requirements and the Generally Applicable
Leverage Capital Requirements as of July 21, 2010, and must not be quantitatively lower than the requirements
that were in effect for insured depository institution as of July 21, 2010. The Collins Amendment defines
Generally Applicable Risk-based Capital Requirements and Generally Applicable Leverage Capital Require-
ments to mean the risk-based capital requirements and minimum ratios of Tier 1 capital to average total assets,
respectively, established by the appropriate federal banking agencies to apply to insured depository institutions
under the Prompt Corrective Action provisions, regardless of total consolidated asset size or foreign financial
exposure. We will be assessing the impact on us of these new regulations as they are proposed and
implemented.
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