Mortgage earnings and originations at Huntington Bancshares Inc. improved as mortgage assets and servicing were boosted by an acquisition.
Before income taxes, Huntington earned $152 million during the three months ended Sept. 30. Income fell from $229 million during the prior period.
Those details and more were delivered Wednesday by the Columbus, Ohio-based bank-holding company in its third-quarter 2016 earnings report.
Pre-tax income also declined from the same three-month period last year, when the total was $200 million.
Huntington said it completed the acquisition of FirstMerit Corp. on Aug. 16, adding $2.5 billion in residential assets and $1.8 billion in commercial real estate assets to its balance sheet.
Mortgage banking income was $41 million, climbing from $32 million in the
second quarter and more than doubling from $19 million in the third-quarter 2015. Earnings benefited from a swing in the valuation adjustment for mortgage servicing rights from prior-period losses to a current-period gain, though increased origination and secondary marketing income also aided.
Home loan originations totaled $1.744 billion during the third-quarter 2016. Business rose from $1.600 billion the prior quarter and $1.259 billion a year prior.
From Jan. 1, 2016, through Sept. 30, residential loan originations came to $4.280 billion.
“Auto and mortgage lending were among the significant drivers of organic loan growth during the quarter, complemented by acquisition-related growth,” Huntington Bancshares Chairman, President and Chief Executive Officer
Steve Steinour stated in the report.
The bank serviced $18.631 billion in mortgages for others at the close of the most-recent quarter. The servicing portfolio expanded from $16.211 billion at the midpoint of 2016 and $15.941 billion at the same point last year.
Residential loans owned by Huntington climbed to $17.785 billion as of Sept. 30, 2016, from $14.824 billion three months earlier.
A year earlier, residential holdings were $14.532 billion.
Last month’s total included $7.665 billion in residential mortgages and $10.120 billion in home-equity loans.
On the residential loans, delinquency of at least 30 days was 2.74 percent at the end of last month. The past-due rate improved from 2.82
percent in June and 3.08 percent in September 2015.
The HEL delinquency
rate was 0.66 percent, 10 basis points worse than at the close of the second quarter but 7 BPS lower than as of the same date in 2016.
Commercial real estate loans on the balance sheet totaled $7.256 billion, jumping from $5.322
at the end of the second quarter and $5.404 billion at the close of the third-quarter 2015.
The latest CRE loan total consisted of $1.414 billion in construction loans and $5.842 billion in commercial mortgages.
Thirty-day CRE loan delinquency deteriorated to 0.43 percent from 0.24 percent as of June 30. The rate was lower, however, than 0.58 percent as of Sept. 30, 2015.
Average staffing jumped to 14,511 full-time equivalent employees from 12,363 in the second quarter prior to the FirstMerit acquisition. Headcount was 12,367 as of the third-quarter 2015.
Huntington operated 1,129 branches as of the most-recent date,
rising from just 772 at the end of the second quarter.
