Huntington Bancshares earnings story updated from 9:08 a.m. with new share price and additional details in final paragraph about legal exposure.
NEW YORK ( TheStreet) -- Huntington Bancshares (HBAN - Get Report) earnings declined slightly in the first quarter, on acquisition costs and an increase in litigation reserves despite growth in several business units.
The Columbus, Ohio-based lender reported earning of $149 million, or $0.17 cents per share on Wednesday, matching analyst expectations. Profits fell 3% versus the first quarter and 6% compared to the fourth quarter of 2013.
|Huntington CEO Stephen Steinour|
Shares were lower by 1.85% to $9.30 per share in late morning trades.
Stephen Steinour, CEO and Chairman, said in an interview that the unusually cold winter caused business activity to be more muted during the quarter. Still, he said Huntington is growing its customer base at record levels and the economy in the six states where the bank operates is improving."We're seeing an increase in business activity and investment and a growing level of confidence which bodes well for us," he said. Huntington incurred $12 million in expenses tied to acquisition of Camco Financial, announced in October. The litigation reserve increased by $9 million.
A spokeswoman for the bank declined to give details about the reason for the increase in the litigation reserve. Huntington added $23.5 million to its legal reserve in 2012 and $17 million in 2011. It did not increase the reserve in 2013. Huntington's most extensive disclosure about its litigation risks in its latest 10-K is tied to Cyberco Holdings, a now-bankrupt company that was raided by the FBI and IRS in 2004 and found to have engaged in equipment leasing fraud. Huntington is also a defendant along with several other banks in a class action lawsuit related to the mortgage electronic registration system (MERS).
Huntington estimates in the 10-K that the "range of reasonably possible losses" in excess of reserves, is from $0-120 million. However it adds that "for certain other cases, Management cannot reasonably estimate the possible loss at this time." Follow @dan_freed