Huntington: Loan Losses Will Peak in 2009

Though some lenders have reported improvement in auto-loan delinquency and loss rates for the first quarter, Huntington Bank’s portfolio worsened slightly.

Thirty-day delinquencies increased to 2.20% of the portfolio, from 2.09% in 4Q08 and 1.45% in 1Q08. Ninety-day delinquencies ticked up to 0.36% from 0.33% in 4Q08 and 0.22% in 1Q08. And chargeoffs climbed to 1.56% from 1.53% and 0.97% in the same two quarters, respectively.

Here’s a chart of chargeoffs and 30- and 90-day delinquencies (chargeoffs and 30-day delinquencies are plotted to the primary Y axis; 90-day delinquencies are plotted to the secondary Y axis):

Aside from loan performance, which the company expects will improve as the year progresses, Huntington shuttered auto operations outside its footprint. The move was meant to “de-risk” the balance sheet, said President and CEO Stephen Steinour during the company’s earnings call on Tuesday.

One other note: Huntington was one of only three auto financiers to securitize loans in the first round of the Federal Reserve’s TALF program last month.