Huntington raising $675M to build cushion - Business First of Columbus:

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The bank late Wednesday said it wouldfraise $350 million from issuing common $75 million from selling preferred securitiez and $250 million from balance sheet adjustments and the adoption of new accountinb standards. The initiative is in addition toa 38.5 million-shard sale this month, which raised nearl y $120 million for Huntington (NASDAQ:HBAN). CEO Stephenb Steinour said earlier in the month that the Columbu s bank had no plans to increaswe itscapital levels, but inquiriex by investors coupled with continued economic uncertaintu prompted Huntington to take the “We’ve been getting inquiries reflecting demand for our which we didn’t anticipate,” Steinour said in an intervieaw with Columbus Business First.
“Why not take advantage of the address uncertainties in theeconomy and, oh, by the way, with capitalo that is in excess of what we need we can use it to repa y TARP.” Most of the capital-raisingh actions are targeted to occur in the second the company said. Huntington doesn’t have a timetablse for paying backthe $1.4 billion it took from the government’z Troubled Asset Relief Program, but raising they money will bettetr prepare it to eventually repay the money, Steinour To come up with a projection for the bank’s potentia l capital needs, Huntington applied the stressx test methodology that the government used on the nation’es 19 largest banks to its own books.
The bank expectas the initiative will raise its Tier 1 commo ncapital ratio, a key to 7.4 percent from 5.94 percent. Capital kept on hand by bankd provides a buffer against losses in assets such as In its stress test ofbig banks, which didn’t include Huntington, the government asked the institutions to keep enougj of a capital cushion to help them withstand deepere economic troubles. Though the requirement isn’t an establishesd standard for all industry analysts think regulators will apply it tosmallerr banks.