Huntington Bancshares Inc.'s fourth-quarter loss narrowed less than analysts expected as the company ratcheted up its credit-loss provisions and said it expects to return to quarterly profitability sometime in 2010.
Huntington joins other banks that have posted improved results in the past week coming off of a year-earlier fourth quarter that was the darkest period in the financial crisis. Beleaguered Huntington hasn't posted a profit in more than a year, changing up leadership and struggling with worse-than-expected loan losses during that time.
"Though there have been recent signs of stability in our markets, the economic outlook nevertheless remains uncertain and fragile," Chairman and Chief Executive Stephen Steinour said Friday. "As such, and to assure we had sufficient reserves to continue to address the resolution of problem credits going forward, loan-loss reserves were significantly strengthened in the fourth quarter."
The Ohio-based regional bank reported a loss of $369.7 million, or 56 cents a share, compared with a year-earlier loss of $417.3 million, or $1.20 a share. There were nearly twice as many shares outstanding in the most-recent quarter as the company raised capital last year through equity sales.
Analysts polled by Thomson Reuters had most recently forecast a 27-cent loss.
Noninterest income nearly quadrupled amid prior-year investment losses.
The company boosted its credit-loss provision to $894 million from a year-earlier $722.6 million and $475.1 million in the prior quarter. Net charge-offs, or loans a bank doesn't think it can collect, were 4.8% compared with 5.41% a year ago and 3.76% in the third quarter. Nonperforming assets, or loans in danger of going bad, were 5.57%, compared with 3.97% and 6.26% in the year-earlier period and the third quarter respectively.
Shares closed at $4.53 Thursday and were inactive premarket.