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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
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DATE OF REPORT: JULY 14, 1998
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HUNTINGTON BANCSHARES INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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Maryland 0-2525 31-0724920
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(STATE OR OTHER (COMMISSION FILE NO.) (IRS EMPLOYER
JURISDICTION OF IDENTIFICATION NUMBER)
INCORPORATION OR
ORGANIZATION)
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Huntington Center
41 South High Street
Columbus, Ohio 43287
(614) 480-8300
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER
INCLUDING AREA CODE OF REGISTRANT'S
PRINCIPAL EXECUTIVE OFFICES)
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ITEM 5. OTHER EVENTS.
On July 14, 1998, Huntington Bancshares Incorporated ("Huntington")
issued a news release announcing its earnings for the second quarter and six
months ended June 30, 1998. The information contained in the news release, which
is attached as an exhibit to this report, is incorporated herein by reference.
On July 21, 1998, Huntington filed a Request for Withdrawal of its
Registration Statement on Form S-3, Registration No. 333-48667, that was
originally filed with the Securities and Exchange Commission on March 26, 1998.
Huntington is withdrawing the Registration Statement because it does not intend
to conduct the offering of shares of Common Stock contemplated in the
Registration Statement. No shares of Common Stock of Huntington have been sold,
or will be sold, pursuant to the Registration Statement.
The information contained or incorporated by reference in this Current
Report on Form 8-K may contain forward-looking statements which are subject to
numerous assumptions, risks, and uncertainties. Actual results could differ
materially from those contained or implied by such 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, and the nature and extent of legislative and regulatory
actions and reforms.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
Exhibit 99 -- News release of Huntington Bancshares Incorporated, dated
July 14, 1998.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HUNTINGTON BANCSHARES INCORPORATED
Date: July 21, 1998 By: /s/ Gerald R. Williams
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Gerald R. Williams, Executive Vice President
and Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description Page
99 * News release of Huntington Bancshares
Incorporated issued on July 14, 1998.
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* Filed with this report.
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Exhibit 99
NEWS RELEASE [HUNTINGTON BANKS LOGO]
FOR IMMEDIATE RELEASE
SUBMITTED: JULY 14, 1998
FOR FURTHER INFORMATION, CONTACT:
MEDIA ANALYSTS
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HILLARY JEFFERS (614) 480-5413 LAURIE COUNSEL (614) 480-3878
CHERI GRAY (614) 480-3803
HUNTINGTON BANCSHARES' SECOND QUARTER YIELDS SUCCESSFUL
FLORIDA BRANCH INTEGRATION AND 10% INCREASE IN EARNINGS
PROPOSED STOCK OFFERING CANCELLED
COLUMBUS, Ohio -- Huntington Bancshares Incorporated (NASDAQ: HBAN;
www.huntington.com) today reported second quarter basic earnings per share of
$.48 and announced the successful conversion of its Florida acquisition of 60
banking offices totaling $1.3 billion in loans and $2.3 billion in deposits. The
acquisition, which closed June 26, 1998, brings total deposits in the Florida
market to nearly $4 billion and makes Huntington the sixth largest bank in the
state. The company formerly announced that, in conjunction with the Florida
acquisition, it intended to issue up to 8.5 million shares of common stock.
During the second quarter, Huntington began to strategically reposition its
balance sheet by decreasing its investment securities held for sale by $2.0
billion and exiting its out-of-market credit card operations. These actions,
combined with the issuance of $300 million in subordinated debt and $100 million
in trust preferred securities, eliminated the need for the proposed common stock
offering. Accordingly, the company will withdraw its registration statement
previously filed with the Securities and Exchange Commission in connection with
the offering.
"Our efforts in the second quarter were important for both the
financial results we achieved and for the numerous strategic actions we took to
ensure the future success of The Huntington," said Frank Wobst, chairman and
chief executive officer of Huntington Bancshares Incorporated. "I am very
pleased with the smooth integration of the new Florida offices and the promise
they bring to our already existing presence in that state. I am also encouraged
by the positive trends seen in the various sources of fee income, which were up
25% this quarter, particularly brokerage, insurance and mortgage banking."
(more)
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For the second quarter of 1998, Huntington reported net income of $92.3
million, compared with $83.6 million for the same period one year ago, an
increase of 10.4%. Diluted earnings per share of $.47 for the quarter increased
9.3% from $.43 per share reported in the year-ago quarter. For the recent three
months, Huntington's return on average equity (ROE) was 17.70% and return on
average assets (ROA) was 1.42%, compared with 18.07% and 1.33% for the same
three months in 1997. Year to date, Huntington's ROE was 17.72% and ROA was
1.40%, compared with 17.75% and 1.30% for the same six months in 1997.
Comparative ROE, ROA and earnings per share (EPS) on a cash basis for the second
quarter and year-to-date in 1998 and 1997 are outlined in the table below.
CASH BASIS
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2nd Qtr. YTD
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1998 1997 1998 1997
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ROE 21.17% 21.90% 21.13% 21.24%
ROA 1.49% 1.40% 1.47% 1.37%
EPS $.50 $.45 $.98 $.88
Commercial loan growth of 14% on a linked quarter basis showed
strengthening trends. Mortgage loan origination continued to be strong with
origination volume up 85% from the year-ago quarter. The $1.2 billion in
mortgage loan production during the first half of this year nearly equals the
total amount closed in 1997. Consumer loans grew 6% on a linked quarter basis,
reflecting the impact of refinance activity on The Huntington's equity lending
products. The company's continued focus on increasing transaction deposits is
reflected in the linked quarter growth of 6.4%. Net interest income for the
quarter was $247.4 million, down $7.4 million from the previous quarter,
reflecting the decrease in earning assets and tighter loan spreads. The net
interest margin was 4.23% in the second quarter versus 4.30% in the previous
quarter.
Core non-interest income grew 25% to $97.4 million for the second
quarter, compared with $77.9 million during the same period last year.
Reflecting increases across all categories, core non-interest income now
represents 28% of total revenues, up from 22.8% a year ago, and moves the
company closer to its 30% goal. Mortgage banking income increased 49.6% or $5.0
million due to continued strong origination activity, 25% of which came from
referrals by the retail banking offices. ATM usage, The Huntington's Check Card
product, telephone bill pay, and on-line banking services drove electronic
banking fees up 21.4%, while brokerage and
(more)
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insurance income increased 36.2% over the second quarter of 1997. Off-balance
sheet managed assets, namely insurance in force, trust assets, proprietary
mutual funds and mortgage loans serviced totaled $21.1 billion and are growing
at an annualized rate of 25.6%.
Non-interest expense for the quarter was $208.3 million, compared with
$185.8 million one year ago. Much of the increase can be attributed to volume
sensitive expenses such as higher sales commissions related to the increase in
fee income and increased communications expenses due to expanded ATMs.
For the second quarter, the company increased its loan loss reserve to
1.50% compared with 1.39% for the same period last year. Net charge-offs as a
percent of average loans were .41% for the 1998 second quarter, compared with
.51% for the 1998 first quarter. Non-performing assets were $101.7 million, or
.53% of total loans and other real estate.
The Huntington's average equity to average assets was 8.02% in the most
recent three month period. Tier 1 and total risk-based capital ratios were 7.22%
and 11.05%, respectively, at June 30, 1998.
Huntington Bancshares is a regional bank holding company headquartered
in Columbus, Ohio with assets of $28 billion. Through its affiliated companies,
The Huntington has more than 132 years of serving the financial needs of its
customers.
The Huntington provides innovative products and services through its
more than 600 offices in Florida, Georgia, Indiana, Kentucky, Maryland,
Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina 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. The Huntington also offers products and services through
its technologically-advanced, 24-hour telephone bank, a network of more than
1,300 ATMs and its Web Bank at www.huntington.com.
For faxed copies of current news releases, please call our
fax-on-demand service, Company News on Call, at (800) 758-5804 extension 423276.
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<TABLE>
HUNTINGTON BANCSHARES INCORPORATED
COMPARATIVE SUMMARY (CONSOLIDATED)
(in thousands, except per share amounts)
<CAPTION>
CONSOLIDATED RESULTS THREE MONTHS ENDED SIX MONTHS ENDED
OF OPERATIONS JUNE 30, JUNE 30,
- ------------------------------------------------- ---------------------- CHANGE ---------------------- CHANGE
1998 1997 % 1998 1997 %
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<S> <C> <C> <C> <C> <C> <C>
Interest Income $491,268 $503,018 (2.3)% $993,748 $978,892 1.5%
Interest Expense 243,839 240,060 1.6 491,471 468,383 4.9
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Net Interest Income 247,429 262,958 (5.9) 502,277 510,509 (1.6)
Provision for Loan Losses 24,595 30,831 (20.2) 46,776 53,211 (12.1)
Securities Gains 14,316 3,604 N.M. 17,405 5,702 N.M.
Non-Interest Income 106,953 77,897 37.3 200,631 152,530 31.5
Non-Interest Expense 208,291 185,805 12.1 406,081 369,666 9.9
Provision for Income Taxes 43,503 44,220 (1.6) 85,661 85,082 0.7
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NET INCOME $ 92,309 $ 83,603 10.4% $181,795 $160,782 13.1%
======== ======== ======== ========
PER COMMON SHARE AMOUNTS
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Net Income per Common Share (1)
Basic $0.48 $0.44 9.1% $0.95 $0.85 11.8%
Diluted $0.47 $0.43 9.3% $0.93 $0.84 10.7%
Cash Dividends Declared (2) $0.18 $0.16 12.5% $0.36 $0.32 12.5%
Shareholders' Equity (period end) (2) $10.08 $9.17 10.0% $10.08 $9.17 10.0%
AVERAGE COMMON SHARES (1)
Basic 192,363 191,346 0.5% 192,263 190,222 1.1%
Diluted 195,149 193,453 0.9% 194,761 192,344 1.3%
KEY RATIOS
Return On:
Average Total Assets 1.42% 1.33% 1.40% 1.30%
Average Shareholders' Equity 17.70% 18.07% 17.72% 17.75%
Efficiency Ratio 58.97% 54.09% 57.16% 55.33%
Net Interest Margin 4.23% 4.54% 4.27% 4.47%
Average Equity/Average Assets 8.02% 7.35% 7.90% 7.33%
Period-end Capital Ratios (3):
Tier I Risk-Based Capital 7.22% 8.99% 7.22% 8.99%
Total Risk-Based Capital 11.05% 12.07% 11.05% 12.07%
Tier I Leverage 6.76% 7.58% 6.76% 7.58%
</TABLE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT THREE MONTHS ENDED SIX MONTHS ENDED
OF CONDITION DATA JUNE 30, JUNE 30,
- ------------------------------------------------ -------------------------- CHANGE -------------------------- CHANGE
1998 1997 % 1998 1997 %
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<S> <C> <C> <C> <C> <C> <C>
Average Total Loans $17,843,277 $17,661,702 1.0% $17,742,635 $17,352,413 2.2%
Average Total Deposits $17,453,550 $17,348,782 0.6 $17,467,802 $16,861,153 3.6
Average Total Assets $26,071,768 $25,238,176 3.3 $26,200,320 $24,912,199 5.2
Average Shareholders' Equity $ 2,091,636 $ 1,856,000 12.7 $ 2,069,223 $ 1,826,682 13.3
ASSET QUALITY (PERIOD END)
Non-performing loans $ 80,137 $ 65,554
Total non-performing assets $ 101,653 $ 79,988
Allowance for loan losses/total loans 1.50% 1.39%
Allowance for loan losses/non-performing loans 357.97% 378.11%
Allowance for loan losses and other real
estate/non-performing assets 280.64% 306.51%
</TABLE>
(1) Excludes impact of ten percent stock dividend to be distributed in July
1998.
(2) Adjusted for the ten percent stock dividend to be payable July 1998.
(3) Estimated.
N.M. - Not Meaningful
