Huntington Bank shares soar after it posts 1st-quarter profit, says credit worries easing
By APWednesday, April 21, 2010
1st-qtr profit report lifts Huntington Bank shares
COLUMBUS, Ohio — Stock in Huntington Bancshares Inc., owner of Huntingon National Bank, soared Wednesday after the company posted a first-quarter profit, said it wrote off fewer bad loans than in late 2009 and forecast a profit for 2010.
After paying preferred dividends, Huntington’s net income applicable to common shareholders was $10.4 million, or a penny per share, compared with a loss of $2.49 billion, or $6.79 per share, in the 2009 first quarter.
The results included a tax benefit of $38.2 million, or 5 cents per share.
Adjusted to remove the tax benefit, the bank would have posted a loss of 4 cents per share.
Analysts polled by Thomson Reuters, on average, expected a loss of 15 cents per share. Analysts typically exclude one-time gains and losses from their estimates.
CEO Stephen D. Steinour bolstered the report with a prediction that Huntington will be profitable for the year.
“We believe that this positive performance momentum will increasingly differentiate us from a number of our peers over coming quarters,” he said during a conference call to discuss the results.
The results and positive outlook sent Huntington stock up 77 cents, or 13.2 percent, to $6.60 in heavy late afternoon trading. Shares earlier hit a high of $6.80, eclipsing its prior annual high by 62 cents.
Huntington said net interest income, the money earned from deposits, rose 17 percent to $393.9 million, from $337.5 million in the 2009 first quarter.
Average deposits rose 13 percent to $37.27 billion, from $33.04 billion last year.
Non-interest income, or money earned from fees and service charges, edged up to $240.9 million, from $239.1 million last year.
Average loans outstanding slid 10 percent to $36.98 billion, from $40.87 billion the year earlier.
Huntington reduced its provision for loan losses, or money set aside to cover souring loans, by 19 percent to $235 million, from $291.8 million a year ago.
Net charge-offs, or loans written off as uncollectable, fell 30 percent to $238.5 million, from $341.5 million last year.
Non-performing assets, or loans considered past due and in danger of being written off, rose 8 percent to $1.92 billion, from $1.78 billion in the year-ago quarter. The recent figure, however, was 7 percent below non-performing assets for the 2009 fourth quarter.
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