Banking & Finance and Economic Development

Huntington picks up 13 more BofA branches

So far in 2014, it has agreed to acquire 24 Bank of America locations in Michigan.

May 16, 2014
| By Pete Daly |
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Huntington Bancshares Inc. in Columbus has agreed to purchase 13 more Michigan branches from Bank of America Corp., including two in Holland and Muskegon.

In early April, Huntington announced it would buy 11 other BofA branches in central and eastern Michigan.

Terms of the deals have not been released.

“With this announcement, Huntington has committed within the past four years to increase our Michigan branch network by more than 120 new locations,” said Stephen D. Steinour, chairman and CEO of Huntington. “We view Michigan as very attractive. We plan to continue to significantly grow our presence within the state.”

The latest 13-branch purchase is for 11 locations in the Monroe and Flint markets and two locations in Holland and Muskegon. In terms of overlap, only the Holland and Muskegon branches and one Monroe branch overlap within two miles of Huntington’s existing branch network.

The 13-branch deal involves Huntington purchasing approximately $500 million in BofA deposits, for a deposit premium of 3.5 percent based on deposit balances at the time the transaction closes, which is expected to be in the second half of this year. No loans are included in the purchase.

The 24 branches bought from BofA will add nearly $1 billion in deposits to the Huntington books.

Bank of America, based in Charlotte, N.C., reported a net loss in April of $276 million, or five cents per diluted share, in the first quarter. In the first quarter last year, it had net income of $1.5 billion, or 10 cents per diluted share.

“The cost of resolving more of our mortgage issues hurt our earnings this quarter,” said BofA CEO Brian Moynihan.

The Wall Street Journal reported last week that bad mortgages BofA made before the national financial crisis at the onset of the recession have been hurting the bank for years.

Huntington said the acquisitions will result in approximately 40 new Huntington Michigan operations jobs. Huntington employment in Michigan has grown by more than 500 jobs since 2011.

Huntington’s Steinour said that organization is “a leading business lender” in Michigan. It has engaged in a series of public-private partnerships with the state and Michigan Economic Development Corp. since 2011, including a $2 billion statewide lending commitment to commercial and small businesses, and the launch of the Pure Michigan Micro Lending Initiative. Huntington also is wrapping up a $100 million commitment it made to investing in “affordable housing” in Michigan, and expects its mortgage and home equity lending to increase as home values continue to improve.

Huntington is the largest Small Business Administration lender in the state, currently making more SBA 7(a) loans in Michigan than all other lenders combined.

“Huntington is a proven partner supporting Michigan households, businesses and neighborhoods,” said Michael A. Finney, MEDC president and CEO, adding it is “also a valued Michigan employer.”

Huntington (NASDAQ: HBAN) is a $60 billion asset regional bank holding company founded in 1866. Its principal markets are Ohio, Michigan, Pennsylvania, Indiana, West Virginia and Kentucky.

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