The Associated Press

COLUMBUS - Huntington Bancshares Inc. said it is pursuing a settlement with federal regulators investigating how it classifies auto leases and expects to be fined.

Columbus-based Huntington, one of Greater Cincinnati's 10 largest banks, said late Monday the Securities and Exchange Commission could fine it for the way it accounted for its auto leases from the mid-1990s to 2002. The announcement was made the same day that two top executives stepped down to reduced company roles.

Company spokeswoman Jeri Grier-Ball declined to comment Tuesday on the amount of the possible settlement.

Huntington chairman Thomas Hoaglin said there is no deadline to settle with the SEC. But the investigation has stalled Huntington's planned merger with Unizan Financial Corp. of Canton.

Huntington operates 32 branches in Greater Cincinnati.

Grier-Ball said the merger is not on hold, but that it can't be approved until the SEC investigation is resolved.

Huntington ended the practice of recording vehicle leases as loans on its balance sheet at the recommendation of an auditor. The accounting practice caused the company's earnings to be $99 million higher from 1995 through the first half of 2003 than they actually were. As a result, the bank has restated its earnings three times.

Monday, chief financial officer Mike McMennamin and controller John Van Fleet stepped down from their current positions. Donald Kimble, head of finance, will take over those positions.

McMennamin will remain in his role as vice chairman of Huntington and Van Fleet is still senior vice president, Grier-Ball said.

Huntington chairman Thomas Hoaglin said McMennamin and Van Fleet's moves were voluntary and timed to coincide with the company filing its quarterly earnings report Monday with the SEC.

"We simply thought that it would be (beneficial) to have a CFO signing that (report) who is not in any way involved with the SEC investigation," Hoaglin said. "Mike very much believed that to be the case."

Shares of Huntington Bancshares fell 32 cents, or 1.3 percent, to close at $23.57 Tuesday on the Nasdaq Stock Market.