HUNTINGTON BANCSHARES INCORPORATED

Red flags

• Nonaccrual loans and leases rose 19% year over year to $931 million, while the allowance for loan and lease losses increased to $2.54 billion from $2.24 billion.
• Commercial and industrial commitments to extend credit increased 28% to $47.7 billion, adding potential future funding and credit exposure beyond on-balance-sheet loans.
• Cadence consideration of approximately $8.1 billion was paid entirely in Huntington stock at 2.475 shares per Cadence share, creating substantial share issuance and integration execution risk.
• Huntington’s loan portfolio increased 15% to $149.6 billion, faster than the disclosed growth in earnings, while commercial exposure rose to 60% of total loans from 56%.