Magazine article American Banker

Huntington of Ohio Joins Other Financials in Slide

Magazine article American Banker

Huntington of Ohio Joins Other Financials in Slide

Article excerpt

Though the company announced a massive buyback program, Huntington Bancshares Inc.'s shares could not escape the falling market Tuesday.

Huntington, of Columbus, Ohio, said that it would spend $400 million over the next 12 months to repurchase 22 million shares, or about 9% of its outstanding shares as of yearend. The $400 million figure was based on Friday's closing price of $18.18 a share, but the price got cheaper Tuesday as Huntington's stock fell 1.8% in a dismal session for financials.

Large banking companies and broker-dealers were hit hardest. Morgan Stanley Dean Witter & Co. and Bank of New York Co. led the group's descent. Morgan Stanley's stock fell 5.7%, while Bank of New York's declined 5.4%.

PNC Financial Services Group Inc.'s stock fell 2.8% after the company announced that an accounting error would force it to restate 2001 earnings for the second time in as many weeks. (See story on page one.)

On July 12 Huntington announced its intention to institute a buyback as part of a broad restructuring effort. At that time management said it would divest Huntington's Florida branches to free up capital to repurchase shares and strengthen its balance sheet.

But since then the U.S. economy has dipped into a recession, and Huntington's credit quality has suffered. On Jan. 18 it reported fourth-quarter operating earnings of 30 cents a share, unchanged from a year earlier. Nonperforming assets at yearend rose 115.8%, to $227. …

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