LOANS AND LEASES

9 Months Ended

Sep. 30, 2023

The following table provides a detailed listing of Huntington’s loan and lease portfolio at September 30, 2023 and December 31, 2022.


(dollar amounts in millions)	At September 30, 2023		At December 31, 2022


















Commercial loan and lease portfolio:
Commercial and industrial	$	49,422	$	48,121
Commercial real estate	12,668		13,640
Lease financing	5,161		5,252
Total commercial loan and lease portfolio	67,251		67,013
Consumer loan portfolio:
Residential mortgage	23,427		22,226
Automobile	12,724		13,154
Home equity	10,118		10,375
RV and marine	5,937		5,376
Other consumer	1,396		1,379
Total consumer loan portfolio	53,602		52,510
Total loans and leases (1)(2)	120,853		119,523
Allowance for loan and lease losses	(2,208)		(2,121)
Net loans and leases	$	118,645	$	117,402

(1)Loans and leases are reported at principal amount outstanding including unamortized purchase premiums and discounts, unearned income, and net direct fees and costs associated with originating and acquiring loans and leases. The aggregate amount of these loan and lease adjustments was a net (discount) premium of $(150) million and $3 million at September 30, 2023 and December 31, 2022, respectively.

(2)The total amount of accrued interest recorded for these loans and leases at September 30, 2023, was $323 million and $209 million of commercial and consumer loan and lease portfolios, respectively, and at December 31, 2022, was $274 million and $186 million of commercial and consumer loan and lease portfolios, respectively. Accrued interest is presented in accrued income and other receivables within the Consolidated Balance Sheets.

Lease Financing

The following table presents net investments in lease financing receivables by category at September 30, 2023 and December 31, 2022.


(dollar amounts in millions)	At September 30, 2023		At December 31, 2022

Lease payments receivable	$	4,867	$	4,916
Estimated residual value of leased assets	805		788
Gross investment in lease financing receivables	5,672		5,704
Deferred origination costs	53		46
Deferred fees, unearned income and other	(564)		(498)
Total lease financing receivables	$	5,161	$	5,252

The carrying value of residual values guaranteed was $481 million and $466 million as of September 30, 2023 and December 31, 2022, respectively. The future lease rental payments due from customers on sales-type and direct financing leases at September 30, 2023, totaled $4.9 billion and were due as follows: $813 million in 2023, $792 million in 2024, $722 million in 2025, $778 million in 2026, $764 million in 2027, and $998 million thereafter. Interest income recognized for these types of leases was $73 million and $41 million for the three-month periods ended September 30, 2023 and 2022, respectively. For the nine-month periods ended September 30, 2023 and 2022, interest income recognized for these types of leases was $211 million and $117 million, respectively.

Nonaccrual and Past Due Loans and Leases

The following table presents NALs by class at September 30, 2023 and December 31, 2022:


	At September 30, 2023				At December 31, 2022
(dollar amounts in millions)	Nonaccrual loans and leases with no ACL		Total nonaccrual loans and leases		Nonaccrual loans and leases with no ACL		Total nonaccrual loans and leases
Commercial and industrial	$	48	$	314	$	49	$	288
Commercial real estate	69		102		63		92
Lease financing	3		14		—		18
Residential mortgage	—		75		—		90
Automobile	—		4		—		4
Home equity	—		82		—		76
RV and marine	—		1		—		1

Total nonaccrual loans and leases	$	120	$	592	$	112	$	569

The following tables present an aging analysis of loans and leases, by class at September 30, 2023 and December 31, 2022:


	Past Due (1)										Loans Accounted for Under FVO		Total Loans and Leases		90 or more days past due and accruing
(dollar amounts in millions)	30-59 Days		60-89 Days		90 or more days		Total		Current
At September 30, 2023
Commercial and industrial	$	45	$	31	$	81	$	157	$	49,265	$	—	$	49,422	$	—
Commercial real estate	21		5		27		53		12,615		—		12,668		—
Lease financing	39		18		9		66		5,095		—		5,161		7		(2)
Residential mortgage	230		68		170		468		22,785		174		23,427		124		(3)
Automobile	81		20		11		112		12,612		—		12,724		8
Home equity	56		28		76		160		9,957		1		10,118		19
RV and marine	17		5		3		25		5,912		—		5,937		2
Other consumer	11		5		3		19		1,377		—		1,396		3
Total loans and leases	$	500	$	180	$	380	$	1,060	$	119,618	$	175	$	120,853	$	163
At December 31, 2022
Commercial and industrial	$	53	$	19	$	108	$	180	$	47,941	$	—	$	48,121	$	23	(4)
Commercial real estate	2		1		9		12		13,628		—		13,640		—
Lease financing	36		18		10		64		5,188		—		5,252		9		(2)
Residential mortgage	246		69		199		514		21,528		184		22,226		146		(3)
Automobile	88		20		11		119		13,035		—		13,154		9
Home equity	56		30		66		152		10,222		1		10,375		15
RV and marine	15		5		3		23		5,353		—		5,376		3
Other consumer	13		3		3		19		1,360		—		1,379		2
Total loans and leases	$	509	$	165	$	409	$	1,083	$	118,255	$	185	$	119,523	$	207

(1)NALs are included in this aging analysis based on the loan’s past due status.

(2)Amounts include Huntington Technology Finance administrative lease delinquencies.

(3)Amounts include mortgage loans insured by U.S. government agencies.

(4)Amounts include SBA loans and leases.

Credit Quality Indicators

See Note 5 “Loans and Leases” to the Consolidated Financial Statements appearing in Huntington’s 2022 Annual Report on Form 10-K for a description of the credit quality indicators Huntington utilizes for monitoring credit quality and for determining an appropriate ACL level.

For all classes within the consumer loan portfolios, borrower credit bureau scores are monitored as an indicator of credit quality. A credit bureau score is a credit score developed by FICO based on data provided by the credit bureaus. The credit bureau score is widely accepted as the standard measure of consumer credit risk used by lenders, regulators, rating agencies, and consumers. The higher the credit bureau score, the higher likelihood of repayment and therefore, an indicator of higher credit quality.

Huntington assesses the risk in the loan portfolio by utilizing numerous risk characteristics. The classifications described above, and also presented in the table below, represent one of those characteristics that are closely monitored in the overall credit risk management processes.

The following tables present the amortized cost basis of loans and leases by vintage and credit quality indicator at September 30, 2023 and December 31, 2022 respectively:


	At September 30, 2023
	Term Loans Amortized Cost Basis by Origination Year												Revolver Total at Amortized Cost Basis		Revolver Total Converted to Term Loans
(dollar amounts in millions)	2023		2022		2021		2020		2019		Prior						Total
Commercial and industrial
Credit Quality Indicator (1):
Pass	$	12,138	$	11,025	$	4,096	$	2,354	$	1,381	$	1,593	$	13,929	$	5	$	46,521
OLEM	98		214		81		31		15		13		344		—		796
Substandard	306		324		193		159		151		230		732		—		2,095
Doubtful	9		1		—		—		—		—		—		—		10
Total Commercial and industrial	$	12,551	$	11,564	$	4,370	$	2,544	$	1,547	$	1,836	$	15,005	$	5	$	49,422
Commercial real estate
Credit Quality Indicator (1):
Pass	$	1,200	$	3,562	$	2,050	$	1,154	$	1,294	$	1,469	$	533	$	—	$	11,262
OLEM	117		290		116		53		33		25		1		—		635
Substandard	152		234		103		18		133		115		16		—		771

Total Commercial real estate	$	1,469	$	4,086	$	2,269	$	1,225	$	1,460	$	1,609	$	550	$	—	$	12,668
Lease financing
Credit Quality Indicator (1):
Pass	$	1,449	$	1,479	$	933	$	680	$	298	$	155	$	—	$	—	$	4,994
OLEM	4		10		9		9		3		1		—		—		36
Substandard	8		49		38		13		14		8		—		—		130
Doubtful	—		—		1		—		—		—		—		—		1
Total Lease financing	$	1,461	$	1,538	$	981	$	702	$	315	$	164	$	—	$	—	$	5,161
Residential mortgage
Credit Quality Indicator (2):
750+	$	1,609	$	3,972	$	6,077	$	3,330	$	769	$	2,253	$	—	$	—	$	18,010
650-749	882		1,023		970		515		188		794		—		—		4,372
<650	54		72		81		64		86		514		—		—		871

Total Residential mortgage	$	2,545	$	5,067	$	7,128	$	3,909	$	1,043	$	3,561	$	—	$	—	$	23,253
Automobile
Credit Quality Indicator (2):
750+	$	1,993	$	2,158	$	1,709	$	862	$	457	$	135	$	—	$	—	$	7,314
650-749	1,250		1,423		1,007		426		205		78		—		—		4,389
<650	164		306		294		134		75		48		—		—		1,021

Total Automobile	$	3,407	$	3,887	$	3,010	$	1,422	$	737	$	261	$	—	$	—	$	12,724
Home equity
Credit Quality Indicator (2):
750+	$	322	$	443	$	530	$	553	$	18	$	261	$	4,490	$	231	$	6,848
650-749	99		103		68		59		7		105		2,046		231		2,718
<650	2		6		4		3		2		45		360		129		551

Total Home equity	$	423	$	552	$	602	$	615	$	27	$	411	$	6,896	$	591	$	10,117
RV and marine
Credit Quality Indicator (2):
750+	$	1,070	$	1,007	$	899	$	616	$	308	$	647	$	—	$	—	$	4,547
650-749	273		256		260		164		95		222		—		—		1,270
<650	4		13		22		19		15		47		—		—		120

Total RV and marine	$	1,347	$	1,276	$	1,181	$	799	$	418	$	916	$	—	$	—	$	5,937
Other consumer
Credit Quality Indicator (2):
750+	$	152	$	89	$	44	$	22	$	20	$	53	$	398	$	3	$	781
650-749	75		48		19		7		6		13		366		14		548
<650	4		6		3		1		2		1		37		13		67

Total Other consumer	$	231	$	143	$	66	$	30	$	28	$	67	$	801	$	30	$	1,396

(1)Consistent with the credit quality disclosures, indicators for the Commercial portfolio are based on internally defined categories of credit grades.

(2)Consistent with the credit quality disclosures, indicators for the Consumer portfolio are based on updated customer credit scores refreshed at least quarterly.


	At December 31, 2022
	Term Loans Amortized Cost Basis by Origination Year												Revolver Total at Amortized Cost Basis		Revolver Total Converted to Term Loans
(dollar amounts in millions)	2022		2021		2020		2019		2018		Prior						Total
Commercial and industrial
Credit Quality Indicator (1):
Pass	$	18,092	$	6,742	$	3,332	$	2,107	$	1,156	$	1,186	$	13,060	$	3	$	45,678
OLEM	108		139		72		21		49		26		113		—		528
Substandard	368		183		203		212		142		256		550		—		1,914
Doubtful	—		—		—		—		—		1		—		—		1
Total Commercial and industrial	$	18,568	$	7,064	$	3,607	$	2,340	$	1,347	$	1,469	$	13,723	$	3	$	48,121
Commercial real estate
Credit Quality Indicator (1):
Pass	$	4,022	$	3,115	$	1,562	$	1,662	$	829	$	1,020	$	519	$	—	$	12,729
OLEM	61		53		1		43		6		9		—		—		173
Substandard	231		116		92		74		84		140		1		—		738

Total Commercial real estate	$	4,314	$	3,284	$	1,655	$	1,779	$	919	$	1,169	$	520	$	—	$	13,640
Lease financing
Credit Quality Indicator (1):
Pass	$	1,930	$	1,291	$	952	$	447	$	186	$	143	$	—	$	—	$	4,949
OLEM	32		9		15		18		6		3		—		—		83
Substandard	65		37		74		24		9		11		—		—		220

Total Lease financing	$	2,027	$	1,337	$	1,041	$	489	$	201	$	157	$	—	$	—	$	5,252
Residential mortgage
Credit Quality Indicator (2):
750+	$	3,666	$	6,274	$	3,566	$	846	$	469	$	2,070	$	—	$	—	$	16,891
650-749	1,394		1,172		617		211		137		777		—		—		4,308
<650	49		68		61		95		90		480		—		—		843

Total Residential mortgage	$	5,109	$	7,514	$	4,244	$	1,152	$	696	$	3,327	$	—	$	—	$	22,042
Automobile
Credit Quality Indicator (2):
750+	$	2,770	$	2,212	$	1,243	$	777	$	289	$	98	$	—	$	—	$	7,389
650-749	1,944		1,508		683		367		162		52		—		—		4,716
<650	307		352		173		115		67		35		—		—		1,049

Total Automobile	$	5,021	$	4,072	$	2,099	$	1,259	$	518	$	185	$	—	$	—	$	13,154
Home equity
Credit Quality Indicator (2):
750+	$	463	$	573	$	611	$	23	$	20	$	301	$	4,787	$	252	$	7,030
650-749	131		88		68		9		8		122		2,129		261		2,816
<650	3		3		3		2		2		51		335		129		528

Total Home equity	$	597	$	664	$	682	$	34	$	30	$	474	$	7,251	$	642	$	10,374
RV and marine
Credit Quality Indicator (2):
750+	$	1,148	$	1,031	$	731	$	361	$	354	$	438	$	—	$	—	$	4,063
650-749	290		315		200		118		113		169		—		—		1,205
<650	5		18		15		17		17		36		—		—		108

Total RV and marine	$	1,443	$	1,364	$	946	$	496	$	484	$	643	$	—	$	—	$	5,376
Other consumer
Credit Quality Indicator (2):
750+	$	207	$	64	$	35	$	34	$	13	$	52	$	393	$	3	$	801
650-749	71		30		12		15		4		14		355		16		517
<650	3		3		2		3		1		2		33		14		61

Total Other consumer	$	281	$	97	$	49	$	52	$	18	$	68	$	781	$	33	$	1,379

(1)Consistent with the credit quality disclosures, indicators for the Commercial portfolio are based on internally defined categories of credit grades.

(2)Consistent with the credit quality disclosures, indicators for the Consumer portfolio are based on updated customer credit scores refreshed at least quarterly.

The following tables present the gross charge-offs of loans and leases by vintage.


	Term Loans Gross Charge-offs by Origination Year												Revolver Gross Charge-offs		Revolver Converted to Term Loans Gross Charge-offs
(dollar amounts in millions)	2023		2022		2021		2020		2019		Prior						Total
Three months ended September 30, 2023
Commercial and industrial	$	2	$	21	$	6	$	6	$	15	$	1	$	3	$	—	$	54
Commercial real estate	5		6		—		—		10		—		7		—		28
Lease Financing	—		3		—		—		—		—		—		—		3
Residential mortgage	—		—		—		—		—		1		—		—		1
Automobile	1		5		3		1		1		1		—		—		12
Home equity	—		—		—		—		—		1		—		1		2
RV and marine	—		—		1		1		1		2		—		—		5
Other consumer	5		5		3		1		1		4		—		7		26
Total	$	13	$	40	$	13	$	9	$	28	$	10	$	10	$	8	$	131
Nine months ended September 30, 2023
Commercial and industrial	$	4	$	39	$	23	$	13	$	26	$	11	$	7	$	1	$	124
Commercial real estate	5		9		19		—		15		5		7		—		60
Lease Financing	—		3		1		1		—		1		—		—		6
Residential mortgage	—		—		1		—		—		3		—		—		4
Automobile	1		11		11		5		4		3		—		—		35
Home equity	—		—		—		—		—		1		1		4		6
RV and marine	—		1		2		2		2		5		—		—		12
Other consumer	8		18		11		4		4		10		—		20		75
Total	$	18	$	81	$	68	$	25	$	51	$	39	$	15	$	25	$	322

Modifications to Debtors Experiencing Financial Difficulty

Effective January 1, 2023, Huntington adopted ASU 2022-02- Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. For additional information on the adoption, refer to both Note 1 “Basis of Presentation” and Note 2 “Accounting Standards Update.”

Huntington will modify the contractual terms of loans to a borrower experiencing financial difficulties as a way to mitigate loss, proactively work with borrowers in financial difficulty, or to comply with regulations regarding the treatment of certain bankruptcy filing and discharge situations.

A debtor is considered to be experiencing financial difficulty when there is significant doubt about the debtor’s ability to make required payments on the debt or to get equivalent financing from another creditor at a market rate for similar debt. A loan placed on nonaccrual because the borrower is experiencing financial difficulty may be returned to accrual status when all contractually due interest and principal has been paid and the borrower demonstrates the financial capacity to continue to pay as agreed, with the risk of loss diminished.

Reported Modification Types

Modifications in the form of principal forgiveness, an interest rate reduction, an other than insignificant payment delay or a term extension that have occurred in the current reporting period to a borrower experiencing financial difficulty are disclosed along with the financial impact of the modifications.

Huntington will generally try other forms of relief before principal forgiveness but would define any contractual reduction in the amount of principal due without receiving payment or assets as forgiveness. For the purpose of the disclosure Huntington considers any contractual change in interest rate that results in the borrower receiving a below market rate to be an interest rate reduction. Many factors can go into what is considered an other than insignificant payment delay such as the significance of the restructured payment amount relative to the normal loan payment or the relative significance of the delay to the original loan terms. Generally, Huntington would consider any delay in payment of greater than 90 days in the last 12 months to be significant. For the purpose of the disclosure modification of contingent payment features or covenants that would have accelerated payment are not considered term extensions.

Following is a description of what is considered a borrower experiencing financial difficulty by the different loan types:

Commercial loan modifications – Our strategy involving commercial borrowers generally includes working with these borrowers to allow them time to improve their financial position and remain a Huntington customer through restructuring their notes or to restructure elsewhere if necessary. Borrowers that are rated substandard or worse in accordance with the regulatory definition, or that cannot otherwise restructure at market terms and conditions, are considered to be experiencing financial difficulty. A subsequent restructuring or modification of a loan may occur when either the loan matures according to the terms of the modified agreement, or the borrower requests a change to the loan agreements. It is subjected to the normal underwriting standards and processes for other similar credit extensions, both new and existing. The restructured note is evaluated to determine if it is considered a new loan or a continuation of the prior loan.

Consumer loan modifications – Consumer loans in which a borrower requires a modification as a result of negative changes to their financial condition or to avoid default, generally indicate the borrower is experiencing financial difficulty. The primary modifications made to consumer loans are amortization, maturity date and interest rate changes. Consumer borrowers identified as experiencing financial difficulty are unable to refinance their loans through the Company’s normal origination channels or through other independent sources. Most, but not all, of the loans may be delinquent. The Company’s primary loan categories that receive modifications are residential mortgage, automobile, home equity, RV and marine, and other consumer loans.

Impact on Credit Quality of Borrowers Experiencing Financial Difficulty

Huntington’s ALLL is influenced by loan level characteristics that inform the assessed propensity to default. As such, the provision for credit losses is impacted primarily by changes in such loan level characteristics, such as payment performance. Commercial borrowers experiencing financial difficulty are risk rated to reflect the increase in default characteristics so that that the ALLL reflects the future risk of loss. Borrowers experiencing financial difficulty can be classified as either accrual or nonaccrual loans.

The following table summarizes the amortized cost basis of loans modified during the reporting period to borrowers experiencing financial difficulty, disaggregated by class of financing receivable and type of modification.


	Amortized Cost
(dollar amounts in millions)	Interest rate reduction		Term extension		Payment deferral		Combo - interest rate reduction and term extension		Total		% of total loan class (1)
Three months ended September 30, 2023
Commercial and industrial	$	1	$	147	$	—	$	1	$	149	0.30	%
Commercial real estate	—		52		—		4		56		0.44
Residential mortgage	—		15		—		1		16		0.07
Automobile	—		4		—		—		4		0.03
Home equity	—		—		—		3		3		0.03


Total loans to borrowers experiencing financial difficulty in which modifications were made	$	1	$	218	$	—	$	9	$	228	0.19	%
Nine months ended September 30, 2023
Commercial and industrial	$	33	$	291	$	—	$	4	$	328	0.66	%
Commercial real estate	—		138		—		4		142		1.12
Residential mortgage	—		50		2		3		55		0.23
Automobile	—		11		—		1		12		0.09
Home equity	—		1		—		8		9		0.09
RV and marine	—		1		—		—		1		0.02
Other consumer	1		—		—		—		1		0.07
Total loans to borrowers experiencing financial difficulty in which modifications were made	$	34	$	492	$	2	$	20	$	548	0.45	%

(1)Represents the amortized cost of loans modified during the reporting period as a percentage of the period-end loan balance by class.

The following table describes the financial effect of the modification made to borrowers experiencing financial difficulty.


	Interest Rate Reduction (1)				Term Extension (1)
	Weighted-average contractual interest rate				Weighted-average years added to the life
	From		To
Three months ended September 30, 2023
Commercial and industrial	10.56	%	8.11	%	1.0
Commercial real estate	13.78		9.12		0.6
Residential mortgage	6.98		5.14		8.4




Nine months ended September 30, 2023
Commercial and industrial	7.96	%	7.25	%	1.0
Commercial real estate	13.76		9.12		0.7
Residential mortgage	6.04		4.59		7.6
Automobile	6.53		6.18		2.0
Home equity	8.71		6.04		14.6

(1) Certain disclosures related to financial effects of modifications do not include those deemed to be immaterial.

The performance of loans made to borrowers experiencing financial difficulty in which modifications were made is closely monitored to understand the effectiveness of modification efforts. Loans are considered to be in payment default at 90 or more days past due. The following table depicts the performance of loans that have been modified during the reporting period.


	At September 30, 2023
	Past Due
(dollar amounts in millions)	30-59 Days		60-89 Days		90 or more days		Total		Current		Total
Commercial and industrial	$	2	$	1	$	3	$	6	$	322	$	328
Commercial real estate	—		5		1		6		136		142
Residential mortgage	10		5		7		22		33		55
Automobile	1		—		—		1		11		12
Home equity	—		—		1		1		8		9
RV and marine	—		—		—		—		1		1
Other consumer	—		—		—		—		1		1
Total loans to borrowers experiencing financial difficulty in which modifications were made in the nine months ended September 30, 2023	$	13	$	11	$	12	$	36	$	512	$	548

TDR Loans

The following provides additional disclosures previously required by ASC Subtopic 310-40, Receivables—Troubled Debt Restructurings by Creditors, related to the three-month and nine-month period ended September 30, 2022.

TDRs are modified loans where a concession was provided to a borrower experiencing financial difficulties. Loan modifications are considered TDRs when the concessions provided would not otherwise be considered. However, not all loan modifications are TDRs. See Note 1 “Significant Accounting Policies” and Note 5 “Loans and Leases” to the Consolidated Financial Statements appearing in Huntington’s 2022 Annual Report on Form 10-K for additional discussion of TDRs.

The following table presents, by class and modification type, the number of contracts, post-modification outstanding balance, and the financial effects of the modification for the three-month and nine-month period ended September 30, 2022.


	New Troubled Debt Restructurings (1)

	Number of Contracts	Post-modification Outstanding Recorded Investment (2)
(dollar amounts in millions)		Interest rate reduction		Amortization or maturity date change		Chapter 7 bankruptcy		Other		Total
Three months ended September 30, 2022
Commercial and industrial	81	$	39	$	22	$	—	$	13	$	74
Commercial real estate	7	5		10		—		—		15

Residential mortgage	184	—		25		1		—		26
Automobile	697	—		6		1		—		7
Home equity	54	—		1		—		—		1
RV and marine	31	—		1		1		—		2
Other consumer	38	—		—		—		—		—
Total new TDRs	1,092	$	44	$	65	$	3	$	13	$	125





Nine months ended September 30, 2022
Commercial and industrial	222	$	69	$	37	$	—	$	14	$	120
Commercial real estate	12	42		10		—		—		52

Residential mortgage	629	—		85		5		—		90
Automobile	1,791	—		13		2		—		15
Home equity	166	—		5		3		—		8
RV and marine	105	—		2		1		—		3
Other consumer	91	—		—		—		—		—
Total new TDRs	3,016	$	111	$	152	$	11	$	14	$	288

(1)TDRs may include multiple concessions and the disclosure classifications are based on the primary concession provided to the borrower.

(2)Post-modification balances approximate pre-modification balances.

Pledged Loans

The Bank has access to the Federal Reserve’s discount window and advances from the FHLB. As of September 30, 2023 and December 31, 2022, these borrowings and advances are secured by $101.5 billion and $70.9 billion, respectively, of loans.