Company: HBAN
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0000049196-25-000020
Chunk: 45

Company: HUNTINGTON BANCSHARES INC /MD/
Filing Date: 2025-02-14
Form: 10-K
Item: Item 8
Chunk 45
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. Given the uncertainty associated with key economic scenario assumptions, the December 31, 2024 ACL included a general reserve that consists of various risk profile components to address uncertainty not measured within the quantitative transaction reserve.

6. MORTGAGE LOAN SALES AND SERVICING RIGHTS 

Residential Mortgage PortfolioThe following table summarizes activity relating to residential mortgage loans sold with servicing retained.  Year Ended December 31,(dollar amounts in millions)202420232022Residential mortgage loans sold with servicing retained$4,124 $4,109 $5,686 Pretax gains resulting from above loan sales (1)78 58 137 Total servicing, late, and other ancillary fees (1)104 98 91 (1)Included in mortgage banking income.The following table summarizes the changes in MSRs recorded using the fair value method.Year Ended December 31,(dollar amounts in millions)20242023Fair value, beginning of period$515 $494 New servicing assets created54 63 Servicing assets sold(1)(1)Change in fair value during the period due to:Time decay (1)(25)(24)Payoffs (2)(30)(24)Changes in valuation inputs or assumptions (3)60 7 Fair value, end of period$573 $515 Loans serviced for third parties, unpaid principal balance, end of period$33,696 $33,237 (1)Represents decrease in value due to passage of time, including the impact from both regularly scheduled principal payments and partial loan paydowns.(2)Represents decrease in value associated with loans that paid off during the period.(3)Represents change in value resulting primarily from market-driven changes in interest rates.MSRs do not trade in an active, open market with readily observable prices. Therefore, the fair value of MSRs is estimated using a discounted future cash flow model. Changes in the assumptions used may have a significant impact on the valuation of MSRs. MSR values are sensitive to movement in interest rates as expected future net servicing income depends on the projected outstanding principal balances of the underlying loans, which are impacted by the level of prepayments.A summary of key assumptions and the sensitivity of the MSR value to changes in these assumptions follows.At December 31, 2024At December 31, 2023Decline in fair value due toDecline in fair value due to(dollar amounts in