PARKERSBURG –Huntington Bancshares Inc. has reported net income for the 2017 third quarter of $275 million, a $148 million, or 116 percent, increase from the year-ago quarter.
Earnings per common share for the 2017 third quarter were 23 cents, up 12 cents, or 109 percent, from the year-ago quarter. Excluding approximately $31 million pretax of FirstMerit acquisition-related net expenses, or 2 cents per common share after tax, adjusted earnings per common share were 25 cents. Tangible book value per common share as of 2017 third quarter-end was $6.85, a 6 percent year-over-year increase. Return on average assets was 1.08 percent, return on average common equity was 10.5 percent, and return on average tangible common equity was 14.1 percent. Total revenue increased 17 percent over the year-ago quarter.
“We earned record net income for the second consecutive quarter as we continue to achieve our long-term financial goals and to deliver sector-leading returns for our shareowners while maintaining our aggregate moderate-to-low risk appetite,” said Steve Steinour, chairman, president and CEO. “The 2017 third quarter marked the one-year anniversary of the largest acquisition in Huntington’s history, and we have substantially completed the integration. We fully implemented $255 million of annualized cost savings, and continue to execute on the deal-related revenue synergies. Consistent execution of our core organic growth strategies, coupled with the realization of these acquisition economics, are the key drivers of third quarter results.”
Huntington’s strategic focus on consumers, small- and medium-sized businesses, and auto finance has positioned the company to grow through the ongoing industry headwinds in corporate banking, he said. The third quarter results illustrated continued momentum in residential mortgage, automobile and RV and marine consumer lending as well as asset finance, Steinour said.
The third quarter also marked the end of the 2017 fiscal year for the U.S. Small Business Administration, during which Huntington earned the distinction of being the second largest SBA 7(a) lender in the nation for the third year in a row and the largest in the 10th consecutive year, Steinour said.
“As a result of the meaningful relationships we developed with our consumer and business customers, Huntington enjoys a very granular deposit base. We are pleased with the quarter’s deposit growth while carefully balancing our deposit costs in the face of rising interest rates.”
Last week Huntington announced that the board declared a quarterly cash dividend on the company’s common stock of 11 cents per share, which represents a 33 cents per share, or 38 percent, increase over the prior quarter. The dividend is payable on Jan. 2 to shareholders of record on Dec. 18.
Specific 2017 Third Quarter Highlights:
∫ $162 million, or 17 percent, year-over-year increase in fully-taxable equivalent revenue, comprised of a $135 million, or 21 percent, increase in fully-taxable equivalent net interest income and a $28 million, or 9 percent, increase in noninterest income.
∫ Net interest margin of 3.29 percent, an increase of 11 basis points from the year-ago quarter.
∫ $32 million, or 4 percent, year-over-year decrease in noninterest expense, including a net decrease of $128 million of FirstMerit acquisition-related expense.
∫ $7.6 billion, or 12 percent, year-over-year increase in average loans and leases, comprised of a $4 billion, or 14 percent, increase in consumer loans and a $3.5 billion, or 11 percent, increase in commercial loans.
∫ $5.6 billion, or 31 percent, year-over-year increase in average securities, including a net increase of 30 million of direct purchase municipal instruments in our Commercial Banking segment.
∫ $11.5 billion, or 19 percent, year-over-year increase in average core deposits, driven by a $5.5 billion, or 45 percent, increase in interest-bearing demand deposits, a $2.7 billion, or 30 percent, increase in savings and other domestic deposits, and a $1.7 billion, or 8 percent, increase in noninterest-bearing demand deposits.
∫ Net charge-offs equated to 0.25 percent of average loans and leases, representing the 14th consecutive quarter below the long-term target range of 0.35 percent to 0.55 percent.
∫ Nonperforming asset ratio of 0.56 percent, down from 0.61 percent a quarter ago and 0.72 percent a year ago.
∫ Repurchase of $123 million of common stock (9.6 million shares at an average cost of $12.75 per share.)
∫ 37 cents, or 6 percent, year-over-year increase in tangible book value per common share to $6.85.