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Is Huntington Bank Safe From Collapse?

Is Huntington Bank Safe From Collapse?

Business

So of course, we all know to keep our accounts maxed out at $250,000. As a result of Uncle Sam’s guarantee via FDIC: Federal Deposit Insurance Corporation. Remember any amount above that rests on President Biden’s guarantee. Not quite the same thing.

Let’s take a look at Huntington Bank and the health of this Ohio institution.

Firstly, let’s start by taking a look at the broader US banking industry. How sick is everyone else? We know Silicon Valley met death last week.

Below we have a chart showing unrealized depreciation on Hold to Maturity Securities (HTM) for top 100 banks versus equity. 

These unrealized losses are NOT reflected in profits or a deduct to equity via Other Comprehensive Income (OCI) – only in the footnotes! Moreover, we don’t find these losses reflected in stress tests or measures of capital adequacy. 

Furthermore a 25 bp (1/4 of 1 percent) increase in rates for a 10-year security causes approximately 2 points in losses (100 par to 98 to reflect yield discount). 

Moreover, looks pretty phenomenal for Huntington!

A multiple of strength over Bank of America for instance. However, in the same loss league as JPMorgan. So kudos to Huntington management! And yes thats what counts! Loan losses, if a bank keeps its losses in check all will be ok! Usually! Bad things happen of course, but it looks like the odds are in your favor here!

Let’s take a look at the recent financials!

Looks good! HUNTINGTON BANCSHARES INCORPORATED REPORTS 2022 FOURTH-QUARTER EARNINGS :: Huntington Bancshares Incorporated (HBAN):

  • “Average total loans and leases increased $1.9 billion, or 2%, from the prior quarter to $118.9 billion. Excluding the decrease in PPP loans, average total loans and leases increased $2.1 billion, or 2%, from the prior quarter.
    • Average total commercial loans and leases increased $1.8 billion, or 3%, and average total consumer loans increased $184 million from the prior quarter.”

Lately all we can read about these days are banks failing everywhere! Are we in a financial crisis? Now some worry Will Bank of America Collapse? And many others worry whether or not there is a Hawaii Bank Run? And of course, many others worry about the more local establishments. Will First Republic Bank Fail ?

Moreover, Huntington Bank is a regional bank based in Columbus, Ohio, that provides a range of financial services to individuals, businesses, and communities in the Midwest region of the United States. Furthermore, the bank has a long history dating back to the 19th century, and it has grown through a series of mergers and acquisitions over the years.

Founded in 1866 as The Huntington National Bank of Columbus, Ohio.

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Map of Huntington branches, as of February 2021 (prior to merger with TCF Bank)

And named after its founder, P.W. Huntington, who had previously served as the cashier of another bank in the area. The bank grew steadily over the next few decades, opening additional branches and expanding its customer base.

In 1923, Huntington National Bank merged with the Hayden-Clinton National Bank, which had been founded in 1865. The combined bank was renamed The Huntington National Bank and Trust Company and continued to grow through additional acquisitions and mergers over the years.

Huntington Bancshares Inc. logo.svg
Huntington Bancshares Inc. logo
Huntington Bancshares – https://www.huntington.com/

In the 1980s and 1990s, the bank expanded its geographic footprint through a series of acquisitions, including Union Commerce Bank, Bank One’s Ohio operations, and Sky Financial Group. These acquisitions helped the bank become one of the largest financial institutions in the Midwest region of the United States.

Today, Huntington Bank has over 1,000 branches and over 2,000 ATMs in Ohio, Michigan, Indiana, Pennsylvania, Kentucky, and West Virginia. Furthermore, the bank offers a range of financial services, including personal and business banking, wealth management, and insurance products.

In summary, Huntington Bank has a long history dating back to the 19th century and has grown through a series of mergers and acquisitions to become one of the largest regional banks in the Midwest region of the United States, offering a range of financial services to individuals, businesses, and communities.

Is Huntington Bank Safe From Collapse?