Columbus, Ohio-based Huntington Bancshares Inc. said Friday that it would take up to a charge of up $300 million, or 81 cents a share, to bolster its loan loss provisions in the fourth quarter.
The provisions are related to loans made by its Sky Financial unit to Franklin Credit Management.
Huntington said those loans are backed by mortgages that have fallen in value, and Franklin recently began reevaluating those loans.
"As a result of this new information, we needed to reassess the collectability of the Franklin loans," the company said.
Huntington said its board reaffirmed its quarterly dividend and said the payout is safe.
"The expected loss in the 2007 fourth quarter does not place our current common stock dividend in question," said Thomas E. Hoaglin, chairman and chief executive officer.
"Capital levels at the holding company and the Huntington National Bank will remain above the regulatory 'well capitalized' minimums," the company added.
