Huntington National Bank 2014 Annual Report Download - page 55

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The table below summarizes our home equity line-of-credit portfolio by the actual maturity date as described above.
Table 12 - Maturity Schedule of Home Equity Line-of-Credit Portfolio
December 31, 2014
More than
(dollar amounts in millions) 1 Year or Less 1 to 2 years 2 to 3 years 3 to 4 years 4 years Total
Secured by first-lien $ 32 $ 3 $ 1 $ 2 $ 2,859 $ 2,897
Secured by junior-lien 197 120 104 17 2,532 2,970
Total home equity line-of-credit $ 229 $ 123 $ 105 $ 19 $ 5,391 $ 5,867
December 31, 2013
Total home equity line-of-credit $ 281 $ 245 $ 130 $ 112 $ 4,684 $ 5,452
The reduction in maturities presented in over 1-year categories is a result of our change to a product with a 20-year amortization
period after 10-year draw period structure. Loans with a balloon payment structure risk is essentially eliminated after 2015.
The amounts in the above table maturing in four years or less primarily consist of balloon payment structures and represent the
most significant maturity risk. The amounts maturing in more than four years primarily consist of exposure with a 20-year
amortization period after the 10-year draw period.
Historically, less than 30% of our home equity lines-of-credit that are one year or less from maturity actually reach the maturity
date.
Residential Mortgages Portfolio
Huntington underwrites all applications centrally, with a focus on higher quality borrowers. We do not originate residential
mortgages that allow negative amortization or allow the borrower multiple payment options and have incorporated regulatory
requirements and guidance into our underwriting process. All residential mortgages are originated based on a completed full appraisal
during the credit underwriting process. We update values in compliance with applicable regulations to facilitate our portfolio
management, as well as our workout and loss mitigation functions.
Several government programs continued to impact the residential mortgage portfolio, including various refinance programs such
as HAMP and HARP, which positively affected the availability of credit for the industry. During the year ended December 31, 2014,
we closed $248.0 million in HARP residential mortgages and $1.8 million in HAMP residential mortgages. The HARP and HAMP
residential mortgage loans are part of our residential mortgage portfolio or serviced for others.
We are subject to repurchase risk associated with residential mortgage loans sold in the secondary market. An appropriate level
of reserve for representations and warranties related to residential mortgage loans sold has been established to address this repurchase
risk inherent in the portfolio (see Operational Risk discussion).
Credit Quality
(This section should be read in conjunction with Note 3 of the Notes to Consolidated Financial Statements.)
We believe the most meaningful way to assess overall credit quality performance is through an analysis of credit quality
performance ratios. This approach forms the basis of most of the discussion in the sections immediately following: NPAs and NALs,
TDRs, ACL, and NCOs. In addition, we utilize delinquency rates, risk distribution and migration patterns, and product segmentation
in the analysis of our credit quality performance.
Credit quality performance in 2014 reflected continued overall improvement. NPAs declined 4% to $337.7 million, compared to
December 31, 2013, as the CRE, automobile and residential portfolio segments showed declines. This was partially offset by
increases in C&I, primarily due to two credit relationships, and home equity as a result of lower partial charge-offs due the housing
market recovery from the lows in 2010-2011. NCOs decreased 34% compared to the prior year, as a result of declines in the CRE,
home equity and residential portfolios. Total criticized loans continued to decline, across both the commercial and consumer
segments on a percentage basis. As a result of the continued credit quality improvement, the ACL to total loans ratio declined by 25
basis points to 1.40%.