Huntington National Bank 2015 Annual Report Download - page 141

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reserve is measured based on the estimation of the discounted expected cash flows or collateral value, less anticipated selling costs, on
the modified loan in accordance with ASC 310-10. The resulting TDR ALLL calculation often results in a higher ALLL amount
because (1) the discounted expected cash flows or collateral value, less anticipated selling costs, indicate a higher estimated loss or,
(2) due to the rate decrease, the discounting of the cash flows on the modified loan, using the pre-modification interest rate, indicates a
reduction in the present value of expected cash flows or collateral value, less anticipated selling costs. In certain instances, the ALLL
may decrease as a result of payments made in connection with the modification.
Commercial loan TDRs – In instances where the bank substantiates that it will collect its outstanding balance in full, the note is
considered for return to accrual status upon the borrower showing a sustained period of repayment performance for a six-month period
of time. This six-month period could extend before or after the restructure date. If a charge-off was taken as part of the restructuring,
any interest or principal payments received on that note are applied to first reduce the bank’s outstanding book balance and then to
recoveries of charged-off principal, unpaid interest, and/or fee expenses while the TDR is in nonaccrual status.
Residential Mortgage, Automobile, Home Equity, and Other Consumer loan TDRs – Modified loans identified as TDRs are
aggregated into pools for analysis. Cash flows and weighted average interest rates are used to calculate impairment at the pooled-loan
level. Once the loans are aggregated into the pool, they continue to be classified as TDRs until contractually repaid or charged-off.
Residential mortgage loans not guaranteed by a U.S. government agency such as the FHA, VA, and the USDA, including TDR
loans, are reported as accrual or nonaccrual based upon delinquency status. Nonaccrual TDRs are those that are greater than 150-days
contractually past due. Loans guaranteed by U.S. government organizations continue to accrue interest on guaranteed rates upon
delinquency.
The following table presents by class and by the reason for the modification the number of contracts, post-modification
outstanding balance, and the financial effects of the modification for the years ended December 31, 2015 and 2014:
New Troubled Debt Restructurings During The Year Ended (1)
December 31, 2015 December 31, 2014
(dollar amounts in thousands)
Number of
Contracts
Post-
modification
Outstanding
Ending
Balance
Financial effects
of modification(2)
Number of
Contracts
Post-
modification
Outstanding
Balance
Financial effects
of modification(2)
C&I—Owner occupied: (3)
Interest rate reduction 4 $ 372 $ (3) 19 $ 2,484 $ 20
Amortization or maturity date change 222 103,686 (2,089) 97 32,145 336
Other 4 661 (22) 7 2,051 (36)
Total C&I—Owner occupied 230 104,719 (2,114) 123 36,680 320
C&I—Other commercial and industrial: (3)
Interest rate reduction 9 7,871 (1,039) 25 50,534 (1,982)
Amortization or maturity date change 543 420,670 (3,764) 285 149,339 (2,407)
Other 12 29,181 (427) 21 7,613 (7)
Total C&I—Other commercial and industrial 564 457,722 (5,230) 331 207,486 (4,396)
CRE—Retail properties: (3)
Interest rate reduction 2 1,803 (11) 5 11,381 420
Amortization or maturity date change 23 16,377 (1,658) 24 27,415 (267)
Other — — — 9 13,765 (35)
Total CRE—Retail properties 25 18,180 (1,669) 38 52,561 118
CRE—Multi family: (3)
Interest rate reduction 1 90 — 20 3,484 (75)
Amortization or maturity date change 50 35,369 (1,843) 40 9,791 197
Other 8 216 (6) 8 5,016 57
Total CRE—Multi family 59 35,675 (1,849) 68 18,291 179
CRE—Office: (3)
Interest rate reduction 1 356 7 2 120 (1)
Amortization or maturity date change 30 73,148 902 22 18,157 (424)