1
Exhibit 99.1
FOR IMMEDIATE RELEASE
APRIL 17, 2001
FOR FURTHER INFORMATION, CONTACT:
MEDIA ANALYSTS
- ----- --------
JERI GRIER (614) 480-5413 LAURIE COUNSEL (614) 480-3878
LAURA BOWERS (614) 480-4433 CHERI GRAY (614) 480-3803
HUNTINGTON BANCSHARES REPORTS
FIRST QUARTER 2001 EARNINGS
COLUMBUS, Ohio - Huntington Bancshares Incorporated (NASDAQ: HBAN;
www.huntington.com) today reported first quarter earnings of $67.9 million, or
$.27 per share, compared with $76.2 million, or $.30 per share, in the fourth
quarter 2000 and $104.2 million, or $.42 per share, a year ago. Return on
average assets (ROA) was .97% and return on average equity (ROE) was 11.53% for
the quarter versus 1.06% and 12.89% for the fourth quarter 2000 and 1.45% and
18.99% in the year-ago quarter.
"These results are clearly not acceptable," said Thomas Hoaglin,
president and chief executive officer of Huntington Bancshares Incorporated. "We
must pick up the pace of growing revenues and reducing expenses, while
maintaining our credit quality in this challenging environment. Clearly, changes
will be necessary. However, I am confident my Huntington associates will welcome
change in the context of a positive new direction that I believe will produce
stronger performance."
Net interest income increased $10.1 million to $243.1 million from the
fourth quarter as a result of net interest margin expansion and was at the
highest level since the fourth quarter of 1999. The margin expanded 23 basis
points, from 3.70% in the fourth quarter to 3.93% in the current quarter,
benefiting from the 1.50% decline in short-term interest rates during the
quarter and the continued reduction of the investment portfolio.
Total managed loan growth during the quarter slowed to an annualized 6%
rate from the fourth quarter rate of 11%. The slowdown in economic conditions
and the volatility in the financial markets significantly impacted consumer loan
growth, with these loans increasing at an
(more)
2
annualized rate of 5% versus 16% in the fourth quarter. The softening in
consumer loan growth was particularly pronounced in the automobile loan and
leasing category, where the annualized growth rate slowed from 16% in the fourth
quarter to zero in the current quarter. Home equity loans, however, increased at
a 14% annualized rate from the previous quarter in spite of the significant
increase in first mortgage refinancing activity. Commercial and commercial real
estate loans increased at a combined 8% rate in the first quarter versus 6% in
the prior quarter.
Non-interest income, excluding securities gains, was $115.6 million for
the quarter, down from $129.7 million in the preceding three months.
Securitization income declined $8.8 million from the unusually high level
reported in the fourth quarter, primarily due to a reduction in the volume of
loans securitized during the recent period. Most other categories of
non-interest income were also down slightly, with the exception of brokerage
revenue, which was up 10% as a result of stronger annuity sales.
Non-interest expense totaled $234.1million in the first quarter, an
increase of $10.2 million from the previous three months. Significant factors
that contributed to the increase were: higher personnel expenses; a $4.2 million
loss from the sale by Huntington's Money Market Mutual Fund of Pacific Gas &
Electric commercial paper, for which Huntington fully reimbursed the fund; and,
the premiums paid in the recent quarter to insure the residual values underlying
Huntington's vehicle leases against possible market declines. The residual value
insurance program provides Huntington with first-dollar protection against
possible declines in Automotive Lease Guide (ALG) values. Huntington purchased
insurance on both its existing leases (subject to a lifetime cap of $120
million) as well as on those to be originated in the future.
Reported net charge-offs, as a percent of average loans, totaled .55%
in the first quarter versus .50% in the previous three months. All of the
increase occurred in both the commercial and commercial real estate portfolios,
with charge-offs on consumer loans unchanged during the quarter. Non-performing
assets increased $19.5 million from the fourth quarter to $124.9 million,
representing .60% of total loans and other real estate at quarter-end versus
$105.4 million or .51% at the end of the fourth quarter. The allowance for loan
losses was 1.45% of total loans, unchanged since the fourth quarter of 1999.
(more)
3
The equity to assets ratio increased from 7.62% for the first quarter
last year to 8.46% for first quarter 2001, resulting from the restructuring of
the balance sheet that has taken place over the last year. Huntington's capital
ratios continue to exceed regulatory requirements for a "well-capitalized"
institution.
A conference call to discuss first quarter results will be held today
at 11:00 a.m. Eastern and will be available via a live Internet Webcast at
www.streetfusion.com. The slides for the conference call, along with
management's comments, will be filed with the Securities and Exchange Commission
on Form 8-K.
A version of this press release containing supplemental tables is
available via PR Newswire's Fax-on-Demand system. Please call (800) 753-0352 and
enter extension 756. The financial tables are also included in the 8-K mentioned
above as well as at www.huntington-ir.com. For faxed copies of all other news
releases, please call (800) 758-5804 extension 423276.
Huntington Bancshares Incorporated is a $28 billion regional bank
holding company headquartered in Columbus, Ohio. Through its affiliated
companies, Huntington has more than 135 years of serving the financial needs of
its customers. Huntington provides innovative products and services through more
than 500 offices in Florida, Indiana, Kentucky, Maryland, Michigan, New Jersey,
Ohio and West Virginia. International banking services are made available
through the headquarters office in Columbus and additional offices located in
the Cayman Islands and Hong Kong. Huntington also offers products and services
online at www.huntington.com; through its technologically advanced, 24-hour
telephone bank, and through its network of more than 1,400 ATMs.
The thirty-fifth annual meeting of shareholders of the corporation will
held in the Capitol Square banking office lobby, 17 South High Street, Columbus,
Ohio on Thursday, April 19, 2001 at 5:00 p.m. Eastern time.
FORWARD-LOOKING STATEMENT DISCLOSURE:
This press release contains certain forward-looking statements,
including certain plans, expectations, goals, and projections, which are subject
to numerous assumptions, risks, and uncertainties. Actual results could differ
materially from those contained or implied by such
(more)
4
statements for a variety of factors including: changes in economic conditions;
movements in interest rates; competitive pressures on product pricing and
services; success and timing of business strategies; the successful integration
of acquired businesses; the nature, extent, and timing of governmental actions
and reforms; and extended disruption of vital infrastructure. All
forward-looking statements included in this news release are based on
information available at the time of the release. Huntington assumes no
obligation to update any forward-looking statement.
###
5
HUNTINGTON BANCSHARES INCORPORATED
CONSOLIDATED COMPARATIVE SUMMARY
(in thousands, except per share amounts)
- --------------------------------------------------------------------------------
CONSOLIDATED RESULTS OF OPERATIONS
- --------------------------------------------------------------------------------
THREE MONTHS ENDED
MARCH 31,
---------------------- CHANGE
2001 2000 %
-------- -------- --------
Interest Income $517,975 $515,557 0.5%
Interest Expense 274,851 274,866 --
Net Interest Income 243,124 240,691 1.0
Provision for Loan Losses 33,464 15,701 113.1
Securities Gains 2,078 24,763 N.M.
Non-Interest Income 115,646 100,931 14.6
Non-Interest Expense 234,090 200,106 17.0
Income Before Income Taxes 93,294 150,578 (38.0)
Provision for Income Taxes 25,428 46,405 (45.2)
-------- --------
NET INCOME $ 67,866 $104,173 (34.9)%
======== ========
PER COMMON SHARE AMOUNTS(1)
Net Income per Common Share
Basic $ 0.27 $ 0.42 (35.7)%
Diluted $ 0.27 $ 0.42 (35.7)%
Diluted - Cash Basis(2) $ 0.30 $ 0.44 (31.8)%
Cash Dividends Declared $ 0.20 $ 0.18 11.1%
Book value at end of period $ 9.58 $ 8.60 11.4%
AVERAGE COMMON SHARES(1)
Basic 250,998 247,974 1.2%
Diluted 251,510 249,139 1.0%
- --------------------------------------------------------------------------------
KEY OPERATING RATIOS
- --------------------------------------------------------------------------------
THREE MONTHS ENDED
MARCH 31,
-------------------------
2001 2000
----------- ---------
Return On:
Average Total Assets 0.97% 1.45%
Average Shareholders' Equity 11.53% 18.99%
Efficiency Ratio 61.95% 53.93%
Net Interest Margin 3.93% 3.78%
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CONDITION DATA
- --------------------------------------------------------------------------------
AVERAGE FOR THREE MONTHS
ENDED MARCH 31, AT MARCH 31,
------------------------- CHANGE ------------------------ CHANGE
2001 2000 % 2001 2000 %
---------- ---------- ---- ---------- ---------- ---
Loans - Reported $20,703,769 $20,797,762 (0.5)% $20,870,648 $20,531,039 1.7%
Loans - Managed 22,061,281 20,799,207 6.1 22,210,181 21,010,669 5.7
Total Deposits 19,065,407 19,790,564 (3.7) 19,130,157 19,779,364 (3.3)
Assets - Reported 28,236,740 28,952,570 (2.5) 28,441,188 28,407,979 0.1
Shareholders' Equity 2,387,653 2,205,921 8.2 2,405,256 2,098,823 14.6
- --------------------------------------------------------------------------------
CAPITAL RATIOS AND ASSET QUALITY
- --------------------------------------------------------------------------------
AT
MARCH 31, MARCH 31,
------------------- --------------------
2001 2000 2001 2000
-------- ------- -------- -------
Tier I Risk-Based Capital(3) 7.20% 7.23% Non-performing loans(NPLs) $110,855 $ 78,307
Total Risk-Based Capital(3) 10.33% 10.90% Total non-performing assets(NPAs) $124,886 $ 92,211
Tier I Leverage(3) 7.13% 6.45% Allowance for loan losses/total loans 1.45% 1.45%
Average Equity/Assets 8.46% 7.62% Allowance for loan losses/NPLs 272.23% 378.95%
Tangible Equity/Assets 6.01% 5.49% Allowance for loan losses and other
real estate/NPAs 239.42% 316.30%
- --------------------------------------------------------------------------------
(1) Adjusted for stock dividends and stock splits, as applicable.
(2) Tangible or "Cash Basis" net income excludes amortization of goodwill,
net of income taxes.
(3) Estimated.
N.M. - Not Meaningful