Standard & Poor's raised its outlook on Huntington Bancshares Inc. to positive from negative, putting the Ohio bank on track to regain investment-grade status if profitability continues to improve.
The regional bank posted five consecutive quarterly losses before returning to the black in the first quarter thanks to reduced credit losses.
Earnings for the year are anticipated as well, according to S&P. It said Thursday that Huntington's improved performance resulted from reduced chargeoffs. Analyst Catherine Mattson added: "The outlook revision reflects our expectation that Huntington's credit quality and profitability will continue to recover in 2010, easing the pressure on its capital."
Huntington is at BB-plus, or one notch into junk. S&P downgraded the company in June 2009 along with four other banks in the wake of the financial crisis. At the time, the credit rating firm said the industry's future wouldn't be as good as the past, citing a potential new regulatory regime among other factors.
Huntington shares closed Thursday at $5.43, down nearly 2%.