Company: HBAN
Filing Date: 2025-04-29
Form Type: 10-Q
Source: 0000049196-25-000038
Chunk: 191

Company: HUNTINGTON BANCSHARES INC /MD/
Filing Date: 2025-04-29
Form: 10-Q
Item: Part I, Item 8
Chunk 191
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 currencies in order to economically hedge significant exposure related to derivatives used in trading activities.The interest rate or price risk of customer derivatives is mitigated by entering into similar derivatives having offsetting terms with other counterparties. The credit risk to these customers is evaluated and included in the calculation of fair value. Foreign currency derivatives help the customer hedge risk and reduce exposure to fluctuations in exchange rates. Transactions are primarily in liquid currencies with Canadian dollars and Euros comprising a majority of all transactions. Commodity derivatives help the customer hedge risk and reduce exposure to fluctuations in the price of various commodities. Hedging of energy-related products and base metals comprise the majority of these transactions.The net fair values of these derivative financial instruments, for which the gross amounts are included in other assets or other liabilities at March 31, 2025 and December 31, 2024, were $57 million and $72 million, respectively. The total notional values of derivative financial instruments used by Huntington on behalf of customers, including offsetting derivatives, were $48.3 billion and $45.2 billion at March 31, 2025 and December 31, 2024, respectively. Huntington’s credit risk from customer derivatives was $77 million and $76 million at the same dates, respectively.Credit derivative instruments Huntington enters into credit default swaps to hedge credit risk associated with certain loans and leases. These contracts are accounted for as derivatives, and accordingly, these contracts are recorded at fair value. The total notional value of credit contracts was $217 million and $247 million at March 31, 2025 and December 31, 2024, respectively. The position of these derivatives was a net asset of $2 million at both March 31, 2025 and December 31, 2024, respectively.Financial assets and liabilities that are offset in the Unaudited Consolidated Balance SheetsHuntington records derivatives at fair value as further described in Note 12 - “Fair Values of Assets and Liabilities”.Derivative balances are presented on a net basis taking into consideration the effects of legally enforceable master netting agreements. Additionally, collateral exchanged with counterparties is also netted against the applicable derivative fair values. Huntington enters into derivative transactions with two primary groups: 1) broker-dealers and banks and 2) Huntington’s customers. Different methods are utilized for managing counterparty credit exposure and credit risk for each of these groups.Huntington enters into transactions with broker-dealers and banks for various risk management purposes. These types of transactions generally are