Stephen Steinour, chief executive of Huntington Bancshares in Columbus, Ohio, has pursued a risky strategy of taking losses in exchange for adding new customers, the Cleveland Plain Dealer reported.
Steinour's business plan for the $71 billion-asset Huntington has included expensive moves, such as giving customers a 24-hour grace period to cover overdrafts and avoid fees. That policy has cost Huntington millions of dollars in revenue, the Plain Dealer said.
Huntington has also given away about 32 million ballpoint pens to customers over the past six years, instead of chaining pens to desks to prevent customers from taking them home. The bank did not provide the cost of its pen giveaway.
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Huntington Bancshares in Columbus, Ohio, has agreed to buy FirstMerit in Akron, Ohio.
January 26 -
Huntington Bancshares in Columbus, Ohio, reported higher fourth-quarter earnings, citing increases in commercial and auto lending and fees from deposit accounts and payment processing.
January 21 -
By pressing forward in business banking, auto lending and branch expansion, CEO Stephen Steinour has Huntington moving fast — and thinking big.
November 28 -
The Ohio company has been giving customers longer grace periods to address overdraft charges. While it has seen service charges decline, the company has been adding customers and checking accounts.
July 24 -
The Columbus, Ohio, company started giving away pens in its branches in 2010. Now more than 20 million are in circulation around the world with a few ending up in bizarre places, including the movie Bad Grandpa.
June 5
Another costly move was Huntington's decision to stop high-to-low reordering of transaction processing, a policy that benefits customers but cost Huntington $28 million in its first full year of implementation.
Steinour has also opened new branches, when other banks have been closing them by the dozen. He also expanded auto lending when car sales had been slumping.
"We choose to put revenue at risk," Steinour told the Plain Dealer.
Huntington has also taken a chance on small businesses that have gone through recent struggles, committing $4 billion of loans to small businesses in the Midwest over a three-year period. Huntington provided a credit line of an unspecified amount to Specialty Fitters, a pipe manufacturer in Elyria, Ohio, after its yearly sales fell to $2 million from $4 million and it lost a credit line from another bank. Since obtaining the Huntington loan, Specialty Fitters' business has rebounded and it's rehired workers it had terminated.
Huntington announced in January that it had agreed to buy the $26 billion-asset FirstMerit in Akron, Ohio, for $3.4 billion.
