UPDATE: Nomura Initiates Coverage on Huntington Bancshares with Neutral Rating on Negative Operating Leverage

In a report published Wednesday, Nomura initiated coverage on Huntington Bancshares (NASDAQ: HBAN) with a Neutral rating and $7.50 price target.Nomura noted, “Initiating coverage with Neutral rating. HBAN has solid capital and credit and has enjoyed good NIM stability since 1Q10 via improved deposit mix and pricing. The bank has also made progress on cross selling and improving revenue per relationship. But we see sluggish loan growth and negative. HBAN faces pressure on the asset yield side, as do other banks, but it has an opportunity to re-price over $4bn of high-cost CDs in 2013, which could help provide a buffer and reduce liability costs. We think HBAN‟s expenses will outgrow revenue in 2013, and expect 100bps of negative operating leverage versus the 226bps expected by consensus.”Huntington Bancshares closed on Tuesday at $7.12.