Huntington Restructures Franklin Debt
In a Securities and Exchange Commission filing late Thursday, Columbus, Ohio-based Huntington said fourth-quarter results would include a $276 million charge for loan and lease losses tied to Franklin. That's slightly smaller than the $300 million charge Huntington anticipated in November, after learning of potential loan losses at Franklin. The bank inherited the commercial relationship from Sky Financial Group, which it acquired in July.
Franklin, which had ceased making new loans and delayed filing its third-quarter results until it can sort out the losses in its loan portfolio, said in a statement Friday the restructuring will allow it to return to profitability. It plans to report third-quarter earnings by Jan. 31.
"These agreements provide Franklin the opportunity to return to a positive net worth and an earnings position that should enable the company to capitalize on its skills and expertise in providing much-needed services to third parties in the residential mortgage and real estate industries, which the company plans to begin promoting immediately," said Franklin CEO Gordon Jardin.As part of the agreement, any new revenue-generating activities will require the approval of Huntington.
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