By John Spence

BOSTON (Dow Jones) -- Shares of Firth Third Bancorp and Huntington Bancshares were down more than 20% in early trading Thursday as investors reacted to more dismal quarterly results from banks.

A trio of Ohio-based regional banks said Thursday they suffered losses as their loan portfolios continued to weaken and the companies booked more write-downs.

Fifth Third Bancorp (FITB), KeyCorp (KEY) and Huntington Bancshares Inc. (HBAN) reported financial results before the opening bell that all came in below consensus expectations.

Fifth Third said it swung to a fourth-quarter net loss of $2.18 billion, or $3.82 a share from a profit of $16 million, or 3 cents a share, a year earlier. Wall Street analysts had been looking for a profit of 2 cents a share, according to a survey by FactSet Research.

The result was affected by a $965 million goodwill impairment charge, as well as losses on loans transferred to its held-for-sale book of $800 million and provisions for loan losses of $729 million.

During the quarter, Cincinnati-based Fifth Third sold $3.4 billion in preferred shares to the Treasury Department under the capital purchase program designed to give financial assistance to banks. The company slashed its quarterly dividend last month to a penny a share in order to conserve capital.

"Economic conditions have deteriorated across our footprint and have placed both our consumer and commercial loan portfolios under significant stress, as evident in our bottom-line results for the year," Chief Executive Kevin Kabat said in a prepared statement.

Fifth Third Bancorp has been dinged by its exposure to real estate loans in states such as Florida, Michigan where markets have been hit particularly hard.

Huntington Bancshares

Also Thursday, Huntington Bancshares of Columbus, Ohio, said its fourth-quarter loss widened to $440.4 million, or $1.20 a share, compared to a loss of $239.3 million, or 65 cents a share, in the year-earlier period.

The consensus analyst estimate was a profit of 20 cents a share, according to FactSet.

The latest quarter's results included a $454.3 million pre-tax charge related to the bank's exposure to mortgage lender Franklin Credit Management Corp. (FCSC). Huntington Bancshares acquired its commercial lending relationship with Franklin Credit when it bought Sky Financial Group Inc.

Huntington also booked a $141.7 million charge from net market-related losses. In the fourth quarter, it had $560.6 million of net charge-offs, including $423.3 million related to Franklin. Huntington ended the year with $520.3 million of net exposure to Franklin.

Non-performing assets, or loans close to going into default, rose by $961.3 million during the fourth quarter to about $1.64 billion, the company said.

"Fourth-quarter performance was clearly disappointing, and Huntington's performance mirrored the industry in that regard," said Stephen Steinour, Huntington's new CEO.

"The poor performance reflected the very difficult and challenging economic environment in which we find ourselves," Steinour said.

"Our relationship with Franklin Credit Management has been the primary worry of our investors," he said.

Huntington, which has received $1.4 billion from the Treasury, cut its quarterly dividend to a penny a share. Top executives are skipping 2008 bonuses, while compensation for the board of directors will only be in common stock going forward, the company said.

KeyCorp

KeyCorp, which has received a $2.5 billion infusion from the Treasury, reported Thursday it suffered a fourth-quarter loss amid lingering credit woes.

The Cleveland-based bank swung to a net loss of $554 million, or $1.13 a share. Last year, the firm reported a fourth-quarter profit of $25 million, or 6 cents a share. Analysts had forecast a loss of 2 cents a share for the period.

The loss was mostly due to a non-cash accounting charge for goodwill impairment and continued building of loan loss reserves "in light of the challenging economic environment," the firm said.

It recorded an after-tax non-cash accounting charge of $420 million and took a $594 million provision for loan losses, up from $363 million at the same point a year ago.

Net interest income fell to $639 million, compared to $710 million last year.

The results "reflect actions taken to manage risks and to fortify the balance sheet for an extremely challenging operating environment," said CEO Henry Meyer. "Like the rest of the banking industry, we face significant headwinds."

Stifel Nicolaus & Co. analysts said in aggregate, they were "disappointed" in core revenue and asset-quality trends. "The deterioration in asset quality was worse than expected."

KeyCorp said it was cutting its dividend by about two-thirds.

"While this move implies that management sees a worsening credit environment than it expected, our overall outlook for the company and its fair value remains unchanged," wrote Morningstar Inc. analyst Maclovio Pina in a research note Thursday.

"Nonetheless, the dividend cut is likely to be unpopular with shareholders, especially as the 67% cut comes after the bank cut its dividend in half in the last quarter," the analyst said.

KeyCorp shares were off about 1% at last check Thursday.

Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary. You can use this link on the day this article is published and the following day.