approximately $2 million40000000.40.30.0025020000002000000negligible5000000P1Yless than $1 millionP1Yfalse--12-31Q3201900000077892019-06-140.150.150.150.170.170.170.010.01692000000200000012000000000156000000520000003300000030000000001.001.00P3YP4Y4000000

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

☑

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: ~~September 30, 2019~~March 31, 2020

Commission file number: 001-31343

Wisconsin

39-1098068

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

~~Wisconsin~~

~~39-1098068~~

~~(State or other jurisdiction of~~

~~incorporation or organization)~~

~~(I.R.S. Employer~~

~~Identification No.)~~

433 Main Street

Green Bay,

Wisconsin

54301

(Address of principal executive offices)

(Zip Code)

(~~920~~)(920) 491-7500

(Former name, former address and former fiscal year, if changed since last report)

Securities Registered Pursuant to Section 12(b) of the act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the ~~extendeBNPransition~~extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

APPLICABLE ONLY TO CORPORATE ISSUERS:

The number of shares outstanding of registrant’s common stock, par value $0.01 per share, at ~~October 25, 2019~~May 7, 2020 was ~~159,341,912.~~



ASSOCIATED BANC-CORP
Table of Contents


ASSOCIATED BANC-CORP
Commonly Used Acronyms and Abbreviations
The following listing provides a reference of common acronyms and abbreviations used throughout the document:


ABS		Asset Backed Securities
ACL		Allowance for Credit Losses on Loans and Investments
ACLL		Allowance for Credit Losses on Loans

~~ABS~~ALCO		~~Asset-Backed Securities~~
~~ALCO~~	Asset / Liability Committee
~~ASC~~
ASC		Accounting Standards Codification
~~ASU~~Associated / Corporation / our / us / we		~~Accounting Standards Update~~Associated Banc-Corp collectively with all of its subsidiaries and affiliates
Associated Bank / the Bank		Associated Bank, National Association
~~Bank Mutual~~ASU		~~Bank Mutual Corporation~~Accounting Standards Update

Basel III		International framework established by the Basel Committee on Banking Supervision for the regulation of capital and liquidity
bp		basis point(s)
CDCARES Act		~~Certificate~~Coronavirus Aid, Relief, and Economic Security Act
CDs		Certificates of Deposit
~~CDI~~CDIs		Core Deposit Intangibles
CECL		Current Expected Credit Losses
CET1		Common Equity Tier 1
~~CMBS~~		~~Commercial Mortgage-Backed Securities~~
~~CMO~~CMOs		Collateralized Mortgage Obligations
~~Corporation~~CRA		~~Associated Banc-Corp collectively with all of its subsidiaries and affiliates~~
~~CRA~~	Community Reinvestment Act
~~EAR~~

EAR		Earnings at Risk
~~FASB~~
Exchange Act		Securities Exchange Act of 1934, as amended
FASB		Financial Accounting Standards Board
FDIC		Federal Deposit Insurance Corporation
~~FFELP~~

Federal Reserve		Board of Governors of the Federal Reserve System
FFELP		Federal Family Education Loan Program
FHLB		Federal Home Loan Bank
FHLMC		Federal Home Loan Mortgage Corporation
FICO		Fair Isaac Corporation, provider of a broad-based risk score to aid in credit decisions
First Staunton		First Staunton Bancshares, Incorporated
FNMA		Federal National Mortgage Association
FTP		Funds Transfer Pricing
GAAP		Generally Accepted Accounting Principles
GNMA		Government National Mortgage Association
GSEs		Government-Sponsored Enterprises
Huntington		The Huntington National Bank, a subsidiary of Huntington Bancshares Incorporated
~~ISDA~~		~~International Swaps and Derivatives Association, Inc.~~
~~LIBOR~~
LIBOR		London Interbank Offered Rate
LTV		Loan-to-Value
MBS		Mortgage-Backed Securities
~~MSR~~MSRs		Mortgage Servicing Rights
MVE		Market Value of Equity
~~NII~~Net Free Funds		Noninterest-bearing sources of funds
NII		Net Interest Income
NPAs		Nonperforming Assets


OCC			Office of the Comptroller of the Currency
~~OCI~~			~~Other Comprehensive Income~~
OREO			Other Real Estate Owned
Parent Company			Associated Banc-Corp individually
~~RAP~~PCD			Purchased Credit Deteriorated
PPP			Paycheck Protection Program
RAP			Retirement Account Plan - the Corporation's noncontributory defined benefit retirement plan
~~restricted stock awards~~Restricted Stock Awards			Restricted common stock and restricted common stock units to certain key employees
S&P			Standard & Poor's
~~SEC~~SBA			Small Business Administration
SEC			U.S. Securities and Exchange Commission
~~Tax Act~~Series C Preferred Stock			~~U.S. Tax Cuts and Jobs Act of 2017~~The Corporation's 6.125% Non-Cumulative Perpetual Preferred Stock, Series C, liquidation preference $1,000 per share
Series D Preferred Stock			The Corporation's 5.375% Non-Cumulative Perpetual Preferred Stock, Series D, liquidation preference $1,000 per share
Series E Preferred Stock			The Corporation's 5.875% Non-Cumulative Perpetual Preferred Stock, Series E, liquidation preference $1,000 per share

TDR			Troubled Debt Restructuring


PART I - FINANCIAL INFORMATION

~~PART I - FINANCIAL INFORMATION~~

ITEM 1.	Financial Statements:

ASSOCIATED BANC-CORP

Consolidated Balance Sheets

September 30, 2019 December 31, 2018
(In Thousands, except share and per share data)
(Unaudited) (Audited)
Assets
Cash and due from banks $ 523,435
$ 507,187
Interest-bearing deposits in other financial institutions 236,010
221,226
Federal funds sold and securities purchased under agreements to resell 100
148,285
Investment securities held to maturity, at amortized cost^(a)
2,200,419
2,740,511
Investment securities available for sale, at fair value^(a)
3,436,289
3,946,941
Equity securities 15,096
1,568
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost 207,443
250,534
Residential loans held for sale 137,655
64,321
Commercial loans held for sale 11,597
14,943
Loans 22,754,710
22,940,429
Allowance for loan losses (214,425 ) (238,023 )
Loans, net 22,540,285
22,702,406
Bank and corporate owned life insurance 670,739
663,203
Investment in unconsolidated subsidiaries 256,220
161,181
Premises and equipment, net 436,268
363,225
Goodwill 1,176,230
1,169,023
Mortgage servicing rights, net 68,168
68,193
Other intangible assets, net 91,089
75,836
Other assets^(b)
589,420
516,538
Total assets $ 32,596,460
$ 33,615,122
Liabilities and Stockholders' Equity
Noninterest-bearing demand deposits $ 5,503,223
$ 5,698,530
Interest-bearing deposits 18,919,339
19,198,863
Total deposits 24,422,562
24,897,393
Federal funds purchased and securities sold under agreements to repurchase 78,028
111,651
Commercial paper 30,416
45,423
FHLB advances 2,877,727
3,574,371
Other long-term funding 796,799
795,611
Accrued expenses and other liabilities^(b)
470,073
409,787
Total liabilities 28,675,605
29,834,235
Stockholders’ Equity
Preferred equity 256,716
256,716
Common equity
Common stock 1,752
1,752
Surplus 1,713,971
1,712,615
Retained earnings 2,341,158
2,181,414
Accumulated other comprehensive income (loss) (36,953 ) (124,972 )
Treasury stock, at cost (355,791 ) (246,638 )
Total common equity 3,664,139
3,524,171
Total stockholders’ equity 3,920,855
3,780,888
Total liabilities and stockholders’ equity $ 32,596,460
$ 33,615,122
Preferred shares issued 264,458
264,458
Preferred shares authorized (par value $1.00 per share) 750,000
750,000
Common shares issued 175,216,409
175,216,409
Common shares authorized (par value $0.01 per share) 250,000,000
250,000,000
Treasury shares of common stock 15,925,525
10,775,938


	March 31, 2020		December 31, 2019
(In Thousands, except share and per share data)	(Unaudited)		(Audited)
Assets
Cash and due from banks	$	480,337	$	373,380
Interest-bearing deposits in other financial institutions	176,440		207,624
Federal funds sold and securities purchased under agreements to resell	22,455		7,740
Investment securities held to maturity, net, at amortized cost^(a)	2,149,373		2,205,083
Investment securities available for sale, at fair value	2,928,787		3,262,586
Equity securities	15,063		15,090
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost	222,922		227,347
Residential loans held for sale	366,330		136,280
Commercial loans held for sale	—		15,000
Loans	24,365,633		22,821,440
Allowance for loan losses^(b)	(337,793)		(201,371)
Loans, net	24,027,841		22,620,068
Bank and corporate owned life insurance	674,026		671,948
Tax credit and other investments	315,909		279,969

Premises and equipment, net	438,469		435,284
Goodwill	1,191,388		1,176,230
Mortgage servicing rights, net	58,289		67,306
Other intangible assets, net	92,723		88,301

Interest receivable	92,377		91,196
Other assets	655,328		506,046
Total assets	$	33,908,056	$	32,386,478
Liabilities and Stockholders' Equity
Noninterest-bearing demand deposits	$	6,107,386	$	5,450,709
Interest-bearing deposits	19,554,194		18,328,355
Total deposits	25,661,580		23,779,064
Federal funds purchased and securities sold under agreements to repurchase	133,007		433,097
Commercial paper	33,647		32,016
FHLB advances	3,214,194		3,180,967
Other long-term funding	549,644		549,343

Allowance for unfunded commitments^(b)	56,276		21,907
Accrued expenses and other liabilities^(b)	469,236		467,961
Total liabilities	30,117,584		28,464,355
Stockholders’ Equity
Preferred equity	256,716		256,716
Common equity
Common stock	1,752		1,752
Surplus	1,706,516		1,716,431
Retained earnings^(b)	2,296,176		2,380,867
Accumulated other comprehensive income (loss)	(16,974)		(33,183)
Treasury stock, at cost	(453,714)		(400,460)
Total common equity	3,533,755		3,665,407
Total stockholders’ equity	3,790,471		3,922,124
Total liabilities and stockholders’ equity	$	33,908,056	$	32,386,478
Preferred shares authorized (par value $1.00 per share)	750,000		750,000
Preferred shares issued and outstanding	264,458		264,458
Common shares authorized (par value $0.01 per share)	250,000,000		250,000,000
Common shares issued	175,216,409		175,216,409
Common shares outstanding	153,690,421		157,171,247

Numbers may not sum due to rounding.

(a) ~~As permitted by ASU 2019-04, which was adopted during~~At March 31, 2020, the ~~third quarter of 2019, the Corporation made a one-time election to transfer municipal~~investment securities ~~with a book value of $692 million from~~ held to maturity are reported net of the related allowance for credit losses on investments. Prior periods were unadjusted due to ~~available for sale.~~the modified retrospective application of ASU 2016-13.

(b) ~~During~~At January 1, 2020, the ~~third quarter~~adoption of ~~2019,~~ASU 2016-13 resulted in an increase to the ~~Corporation made~~allowance for loan losses of $112 million and an increase to the allowance for unfunded commitments of $19 million for a ~~change~~total increase to the ACLL of $131 million. A corresponding after tax decrease to common equity of $98 million was recorded along with a deferred tax asset of $33 million, included in ~~accounting policy~~accrued expenses and other liabilities. Prior periods were unadjusted due to ~~offset derivative assets and liabilities and cash collateral with~~ the same counterparty where it has a legally enforceable master netting agreement in place. The change had no impact on either earnings or equity. The Corporation believes that this change is a preferable methodmodified retrospective application of accounting as it provides a better reflection of the assets and liabilities on the face of the consolidated balance sheets. Adoption of this change was voluntary and has been adopted retrospectively with all prior periods presented herein revised.

See accompanying notes to consolidated financial statements.

Item 1. Financial Statements Continued:

ASSOCIATED BANC-CORP

Consolidated Statements of Income (Unaudited)

(In Thousands, except per share data)

Wealth management fees^(a)

Asset gains (losses), net^(b)

Acquisition related costs^(c)

Acquisition related costs^(b)

Numbers may not sum due to rounding.

(a) Includes trust, asset management, brokerage, and annuity fees.

(b) ~~The nine months ended September 30, 2019 include~~ ~~less than $1 million~~ ~~of Huntington related asset losses; the three months and nine months ended September 30, 2018 include~~ ~~approximately $1 million~~ ~~and $2 million of Bank Mutual acquisition related asset losses net of asset gains, respectively.~~

~~(c)~~ Includes ~~Bank Mutual,~~ Huntington branch and First Staunton acquisition related costs only.

See accompanying notes to consolidated financial statements.

Item 1. Financial Statements Continued:

ASSOCIATED BANC-CORP

Consolidated Statements of Comprehensive Income (Unaudited)

Numbers may not sum due to rounding.

See accompanying notes to consolidated financial statements.

Item 1. Financial Statements Continued:

ASSOCIATED BANC-CORP

Consolidated Statements of Changes in Stockholders’ Equity

Numbers may not sum due to rounding.

(a) Series C, $0.3828125 per share; Series D, $0.3359375 per share; and Series E, $0.3671875 per share.


(In Thousands, except per share data)	Preferred Equity		Common Stock		Surplus		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total
Balance, December 31, 2018	$	256,716	$	1,752	$	1,712,615	$	2,181,414	$	(124,972)	$	(246,638)	$	3,780,888
Comprehensive income
Net income	—		—		—		86,686��		—		—		86,686
Other comprehensive income (loss)	—		—		—		—		21,597		—		21,597

Comprehensive income													108,283
Common stock issued
Stock-based compensation plans, net	—		—		(32,220)		—		—		39,265		7,045


Purchase of treasury stock, open market purchases	—		—		—		—		—		(29,999)		(29,999)
Purchase of treasury stock, stock-based compensation plans	—		—		—		—		—		(7,468)		(7,468)
Cash dividends
Common stock, $0.17 per share	—		—		—		(28,183)		—		—		(28,183)
Preferred stock^(a)	—		—		—		(3,801)		—		—		(3,801)


Stock-based compensation expense, net	—		—		9,397		—		—		—		9,397


Other	—		—		—		(293)		—		—		(293)
Balance, March 31, 2019	$	256,716	$	1,752	$	1,689,792	$	2,235,824	$	(103,375)	$	(244,840)	$	3,835,870

Numbers may not sum due to rounding.

(a) Series C, $0.3828125 per share; Series D, $0.3359375 per share; and Series E, $0.3671875 per share.

See accompanying notes to consolidated financial statements.

Table of Contents

Item 1. Financial Statements Continued:

ASSOCIATED BANC-CORP

Consolidated Statements of ~~Changes in Stockholders’ Equity (Unaudited)~~

(In Thousands, except per share data) Preferred Equity Common Stock Surplus
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury Stock Total
Balance, December 31, 2017 $ 159,929
$ 1,618
$ 1,338,722
$ 1,934,696
$ (62,758 ) $ (134,764 ) $ 3,237,443
Comprehensive income
Net income —
—
—
69,456
—
—
69,456
Other comprehensive income (loss) —
—
—
—
(31,177 ) —
(31,177 )
Adoption of new accounting standards —
—
—
—
(13,738 ) —
(13,738 )
Comprehensive income 24,541
Common stock issued
Stock-based compensation plans, net —
—
(7,665 ) 20,136
—
(1,780 ) 10,691
Acquisition of Bank Mutual —
134
390,258
—
—
91,296
481,688
Purchase of common stock returned to authorized but unissued —
(11 ) (26,469 ) —
—
—
(26,480 )
Purchase of treasury stock —
—
—
—
—
(5,240 ) (5,240 )
Cash dividends
Common stock, $0.15 per share —
—
—
(25,710 ) —
—
(25,710 )
Preferred stock^(b)
—
—
—
(2,339 ) —
—
(2,339 )
Purchase of preferred stock (76 ) —
—
(2 ) —
—
(78 )
Stock-based compensation expense, net —
—
3,675
—
—
—
3,675
Tax Act reclassification —
—
—
13,654
—
—
13,654
Change in accounting principle —
—
—
84
—
—
84
Other —
—
—
771
—
—
771
Balance, March 31, 2018 $ 159,853
$ 1,741
$ 1,698,521
$ 2,010,746
$ (107,673 ) $ (50,488 ) $ 3,712,699

Comprehensive income:
Net income —
—
—
89,192
—
—
89,192
Other comprehensive income (loss) —
—
—
—
(12,215 ) —
(12,215 )
Comprehensive income 76,977
Common stock issued:
Stock-based compensation plans, net —
—
1,455
(485 ) —
4,486
5,456
Acquisition of Bank Mutual —
3
6,717
—
—
—
6,720
Purchase of common stock returned to authorized but unissued —
(3 ) (6,592 ) —
—
—
(6,595 )
Purchase of treasury stock —
—
—
—
—
(477 ) (477 )
Cash dividends:

Common stock, $0.15 per share —
—
—
(26,107 ) —
—
(26,107 )
Preferred stock^(b)
—
—
—
(2,329 ) —
—
(2,329 )
Common stock warrants exercised —
10
(10 ) —
—
—
—
Purchase of preferred stock (452 ) —
—
(6 ) —
—
(459 )
Stock-based compensation expense, net —
—
4,497
—
—
—
4,497
Other —
—
—
(139 ) —
—
(139 )
Balance, June 30, 2018 $ 159,401
$ 1,751
$ 1,704,587
$ 2,070,872
$ (119,888 ) $ (46,479 ) $ 3,770,244

~~See accompanying notes to consolidated financial statements.~~

~~Item 1. Financial Statements Continued:~~

~~ASSOCIATED BANC-CORP~~

~~Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)~~

(In Thousands, except per share data) Preferred Equity Common Stock Surplus Retained
Earnings Accumulated
Other
Comprehensive
Income (Loss) Treasury Stock Total
Balance, June 30, 2018 $ 159,401
$ 1,751
$ 1,704,587
$ 2,070,872
$ (119,888 ) $ (46,479 ) $ 3,770,244

Comprehensive income:
Net income —
—
—
85,929
—
—
85,929
Other comprehensive income (loss) —
—
—
—
(15,631 ) —
(15,631 )
Comprehensive income 70,298
Common stock issued:
Stock-based compensation plans, net^(a)

—
—
(129 ) (289 ) —
1,664
1,246
Purchase of treasury stock —
—
—
—
—
(118,663 ) (118,663 )
Cash dividends:
Common stock, $0.15 per share —
—
—
(25,614 ) —
—
(25,614 )
Preferred stock^{(b) (c)}

—
—
—
(2,409 ) —
—
(2,409 )
Issuance of preferred stock 97,315
—
—
—
—
—
97,315
Common stock warrants exercised —
1
(1 ) —
—
—
—
Stock-based compensation expense, net —
—
4,620
—
—
—
4,620
Balance, September 30, 2018 $ 256,716
$ 1,752
$ 1,709,078
$ 2,128,490
$ (135,520 ) $ (163,478 ) $ 3,797,038

~~Numbers may not sum due to rounding.~~

(a) As previously disclosed in the Corporation's 2018 Annual Report on Form 10-K, an adjustment was made to the September 30, 2018 stockholders' equity balances related to the grant and vesting of options, restricted stock awards, and restricted stock units awarded. This adjustment decreased Surplus approximately $561,000, increased Retained Earnings approximately $272,000, and increased Treasury Stock approximately $289,000. The reclassification had no impact on earnings, expenses, or total stockholders' equity.

~~(b) Series C, $0.3828125 per share and Series D, $0.3359375 per share.~~

~~(c) Series E, $0.3671875 per share.~~

~~See accompanying notes to consolidated financial statements.~~

~~Item 1. Financial Statements Continued:~~

~~ASSOCIATED BANC-CORP~~

~~Consolidated Statements of~~ Cash Flows (Unaudited)


	Nine Months Ended September 30,							Three Months Ended March 31,
($ in Thousands)	2019			2018			($ in Thousands)	2020		2019
Cash Flow From Operating Activities							Cash Flow From Operating Activities
Net income	$	254,686		$	244,578		Net income	$	45,838	$	86,686
Adjustments to reconcile net income to net cash provided by operating activities
Adjustments to reconcile net income to net cash provided by (used in) operating activities							Adjustments to reconcile net income to net cash provided by (used in) operating activities
Provision for credit losses	16,000			(1,000		)	Provision for credit losses	53,001		6,000
Depreciation and amortization	43,704			36,273			Depreciation and amortization	14,971		14,358
Addition to (recovery of) valuation allowance on mortgage servicing rights, net	177			(669		)	Addition to (recovery of) valuation allowance on mortgage servicing rights, net	9,098		121
Amortization of mortgage servicing rights	8,749			7,143			Amortization of mortgage servicing rights	3,635		2,693
Amortization of other intangible assets	7,237			5,926			Amortization of other intangible assets	2,814		2,226
Amortization and accretion on earning assets, funding, and other, net	17,607			(425		)	Amortization and accretion on earning assets, funding, and other, net	5,728		6,571
Net amortization of tax credit investments	15,512			14,388			Net amortization of tax credit investments	6,486		5,637
Losses (gains) on sales of investment securities, net	(5,931		)	1,985			Losses (gains) on sales of investment securities, net	(6,118)		(1,680)
Asset (gains) losses, net	(2,316		)	(1,353		)	Asset (gains) losses, net	77		(567)
(Gain) loss on mortgage banking activities, net	(15,966		)	(4,519		)	(Gain) loss on mortgage banking activities, net	(14,274)		(3,174)
Mortgage loans originated and acquired for sale	(824,289		)	(847,619		)	Mortgage loans originated and acquired for sale	(310,254)		(162,521)
Proceeds from sales of mortgage loans held for sale	1,048,729			826,929			Proceeds from sales of mortgage loans held for sale	297,265		159,842
Pension Contribution	—			(41,877		)

Changes in certain assets and liabilities							Changes in certain assets and liabilities
(Increase) decrease in interest receivable	2,476			(14,791		)	(Increase) decrease in interest receivable	(1,181)		(12,068)
Increase (decrease) in interest payable	589			4,671			Increase (decrease) in interest payable	(6,511)		(1,516)
Increase (decrease) in expense payable	(15,932		)	41,938			Increase (decrease) in expense payable	(61,924)		(51,247)
Increase (decrease) in cash collateral	(8,237		)	37,272
Increase (decrease) in net derivative position	(109,948		)	(21,428		)

(Increase) decrease in net derivative position							(Increase) decrease in net derivative position	(77,369)		(54,411)
Net change in other assets and other liabilities	37,138			15,321			Net change in other assets and other liabilities	18,636		(10,552)
Net cash provided by (used in) operating activities	469,986			302,743			Net cash provided by (used in) operating activities	(20,083)		(13,602)
Cash Flow From Investing Activities							Cash Flow From Investing Activities
Net increase in loans	(72,644		)	(322,589		)	Net increase in loans	(1,395,767)		(216,817)
Purchases of							Purchases of
Available for sale securities	(460,124		)	(737,580		)	Available for sale securities	(93,487)		(120,282)
Held to maturity securities	(322,590		)	(553,258		)	Held to maturity securities	(29,463)		(140,670)
Federal Home Loan Bank and Federal Reserve Bank stocks	(214,554		)	(267,432		)	Federal Home Loan Bank and Federal Reserve Bank stocks	(49,794)		(88,245)
Premises, equipment, and software, net of disposals	(50,385		)	(42,941		)	Premises, equipment, and software, net of disposals	(11,045)		(13,368)
Other intangibles							Other intangibles	(200)		—
Proceeds from							Proceeds from
Sales of available for sale securities	1,367,450			601,130			Sales of available for sale securities	365,239		131,122

Sale of Federal Home Loan Bank and Federal Reserve Bank stocks	257,646			231,964			Sale of Federal Home Loan Bank and Federal Reserve Bank stocks	55,000		121,839
Prepayments, calls, and maturities of available for sale investment securities	400,648			487,858			Prepayments, calls, and maturities of available for sale investment securities	186,496		135,541
Prepayments, calls, and maturities of held to maturity investment securities	168,378			168,125			Prepayments, calls, and maturities of held to maturity investment securities	84,360		43,953
Sales, prepayments, calls, and maturities of other assets	6,674			22,132			Sales, prepayments, calls, and maturities of other assets	10,482		3,179
Net change in tax credit and alternative investments	(50,117		)	(30,579		)	Net change in tax credit and alternative investments	(17,877)		(18,772)
Net cash (paid) received in acquisition	551,250			59,472			Net cash (paid) received in acquisition	(31,452)		—
Net cash provided by (used in) investing activities	1,581,631			(383,698		)	Net cash provided by (used in) investing activities	(927,507)		(162,518)
Cash Flow From Financing Activities							Cash Flow From Financing Activities
Net increase (decrease) in deposits	(1,200,004		)	204,700			Net increase (decrease) in deposits	1,443,965		635,664
Net increase (decrease) in short-term funding	(48,630		)	(528,285		)	Net increase (decrease) in short-term funding	(324,317)		2,043
Net increase (decrease) in short-term FHLB advances	(685,000		)	121,000			Net increase (decrease) in short-term FHLB advances	30,000		(880,000)
Repayment of long-term FHLB advances	(763,036		)	(1,900,012		)	Repayment of long-term FHLB advances	(5,464)		(169)
Proceeds from long-term FHLB advances	751,573			1,841,776			Proceeds from long-term FHLB advances	—		250,633
Proceeds from issuance of long-term funding	—			300,000
Proceeds from issuance of preferred shares	—			97,315

Proceeds from finance lease principal							Proceeds from finance lease principal	1		—

Proceeds from issuance of common stock for stock-based compensation plans	9,070			17,393			Proceeds from issuance of common stock for stock-based compensation plans	2,896		7,045
Purchase of preferred shares	—			(646		)
Purchase of common stock returned to authorized but unissued	—			(33,075		)
Purchase of treasury stock	(138,093		)	(124,380		)

Purchase of treasury stock, open market purchases							Purchase of treasury stock, open market purchases	(71,255)		(29,999)
Purchase of treasury stock, stock-based compensation plans							Purchase of treasury stock, stock-based compensation plans	(5,555)		(7,468)
Cash dividends on common stock	(83,248		)	(77,431		)	Cash dividends on common stock	(28,392)		(28,183)
Cash dividends on preferred stock	(11,402		)	(7,077		)	Cash dividends on preferred stock	(3,801)		(3,801)
Net cash provided by (used in) financing activities	(2,168,770		)	(88,722		)	Net cash provided by (used in) financing activities	1,038,079		(54,235)
Net increase (decrease) in cash, cash equivalents, and restricted cash	(117,154		)	(169,677		)	Net increase (decrease) in cash, cash equivalents, and restricted cash	90,488		(230,355)
Cash, cash equivalents, and restricted cash at beginning of period	876,698			716,018			Cash, cash equivalents, and restricted cash at beginning of period	588,744		876,698
Cash, cash equivalents, and restricted cash at end of period	$	759,545		$	546,341		Cash, cash equivalents, and restricted cash at end of period	$	679,232	$	646,343
Supplemental disclosures of cash flow information							Supplemental disclosures of cash flow information
Cash paid for interest	$	266,192		$	185,875		Cash paid for interest	$	66,316	$	91,521
Cash paid for (received from) income and franchise taxes	38,979			17,335			Cash paid for (received from) income and franchise taxes	1,373		(5,760)
Loans and bank premises transferred to OREO	7,734			20,781			Loans and bank premises transferred to OREO	3,374		2,222
Capitalized mortgage servicing rights	8,900			7,826			Capitalized mortgage servicing rights	3,716		1,247
Loans transferred into held for sale from portfolio, net	326,476			56,550			Loans transferred into held for sale from portfolio, net	205,065		1,074
Unsettled trades to purchase securities							Unsettled trades to purchase securities	—		11,244
Acquisition							Acquisition
Fair value of assets acquired, including cash and cash equivalents	695,848			2,567,560			Fair value of assets acquired, including cash and cash equivalents	457,448		—
Fair value ascribed to goodwill and intangible assets	29,837			261,142			Fair value ascribed to goodwill and intangible assets	22,538		(79)
Fair value of liabilities assumed	725,764			2,340,294			Fair value of liabilities assumed	479,985		—
Equity issued in (adjustments related to) acquisition	(79		)	488,408			Equity issued in (adjustments related to) acquisition	—		(79)

Numbers may not sum due to rounding.

See accompanying notes to consolidated financial statements.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same sum amounts shown inon the consolidated statements of cash flows:


	Three Months Ended March 31,
($ in Thousands)	2020		2019
Cash and cash equivalents	$	679,232	$	489,095
Restricted cash	—		157,248
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows	$	679,232	$	646,343

Nine Months Ended September 30,
($ in Thousands)
2019 2018
Cash and cash equivalents $ 562,798
$ 457,728
Restricted cash 196,747
88,613
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 759,545
$ 546,341

Amounts included in restricted cash represent required reserve balances with the Federal Reserve Bank, which is included in interest-bearing deposits in other financial institutions on the face of the consolidated balance sheets. At March 31, 2020, the Corporation had no restricted cash due to the Federal Reserve reducing the requirement ratios to zero percent.

Item 1. Financial Statements Continued:

ASSOCIATED BANC-CORP

Notes to Consolidated Financial Statements

These interim consolidated financial statements have been prepared according to the rules and regulations of the SEC and, therefore, certain information and footnote disclosures normally presented in accordance with GAAP have been omitted or abbreviated. The information contained inon the consolidated financial statements and footnotes in Associated Banc-Corp's ~~2018~~2019 Annual Report on Form 10-K should be referred to in connection with the reading of these unaudited interim financial statements.

Note 1 Basis of Presentation

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the financial position, results of operations and comprehensive income, changes in stockholders’ equity, and cash flows of the Corporation and Parent Company for the periods presented, and all such adjustments are of a normal recurring nature. The consolidated financial statements include the accounts of all subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.

In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the ~~consolidated~~ balance ~~sheets~~sheet and revenues and expenses for the period. Actual results could differ significantly from those estimates. Estimates that are particularly susceptible to significant change include the determination of the ~~allowance for loan losses,~~ACLL, goodwill impairment assessment, ~~mortgage servicing rights~~MSRs valuation, and income taxes. Management has evaluated subsequent events for potential recognition or disclosure.

Within the tables presented, certain columns and rows may not sum due to the use of rounded numbers for disclosure purposes.

~~Huntington Wisconsin Branch~~First Staunton Acquisition

On February ~~15, 2019,~~14, 2020, the Corporation ~~received regulatory approval for the~~completed its acquisition of ~~the Wisconsin branches of Huntington. This all cash transaction closed~~First Staunton. The Corporation paid a 4% premium on ~~June 14, 2019.~~acquired deposits. The conversion of the branches ~~happened~~was completed simultaneously with the close of the transaction, ~~and~~expanding the ~~acquisition expanded the Bank's~~banks presence into 139 new ~~Wisconsin~~Metro-East St. Louis communities. As a result of the acquisition and other consolidations, a net of 147 branch locations were added.

The ~~Huntington branch~~First Staunton acquisition constituted a business combination. The acquisition has been accounted for using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration exchanged were recorded at estimated fair value on the acquisition date. The determination of estimated fair values required management to make certain estimates that are subjective in nature and may require adjustments upon the availability of new information regarding facts and circumstances which existed at the date of acquisition (i.e., appraisals) for up to a year following the acquisition. The Corporation continues to review information relating to events or circumstances existing at the acquisition date. Management anticipates that this review could result in adjustments to the acquisition date valuation amounts presented herein but does not anticipate that these adjustments will be material.

The Corporation recorded approximately $15 million in goodwill related to the First Staunton acquisition during the first quarter of 2020. Goodwill created by the acquisition is not tax deductible. See Note 8 for additional information on goodwill, as well as the carrying amount and amortization of CDI assets related to the First Staunton acquisition.

The following table presents the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date related to the First Staunton acquisition:


($ in Thousands)	Purchase Accounting Adjustments		February 14, 2020
Assets
Cash and cash equivalents	$	—	$	44,848
Investment securities available for sale	(24)		98,743
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost	—		781
Loans	(4,808)		369,684
Premises and equipment, net	(3,005)		4,865
Bank owned life insurance	9		6,770
Goodwill			15,158
Core deposit intangibles (included in other intangible assets, net on the face of the consolidated balance sheets)	7,379		7,379
OREO (included in other assets on the face of the consolidated balance sheets)	670		762
Other assets	2,486		7,293
Total assets			$	556,285
Liabilities
Deposits	$	1,285	$	438,684
Other borrowings	61		34,613
Accrued expenses and other liabilities	179		6,688
Total liabilities			$	479,985
Total consideration paid			$	76,300

For a description of methods used to determine the fair value of significant assets and liabilities presented on the balance sheet above, see Assumptions section of this Note.

The Corporation has purchased loans with the First Staunton acquisition, for which there was, at acquisition, evidence of more than insignificant deterioration of credit quality since origination. The carrying amount of those loans is as follows:


($ in Thousands)	February 14, 2020
Purchase price of loans at acquisition	$	77,221
Allowance for credit losses at acquisition	3,504
Non-credit discount/(premium) at acquisition	(951)
Par value of acquired loans at acquisition	$	79,774

There were 0 PCD securities.

Huntington Wisconsin Branch Acquisition

On June 14, 2019, the Corporation completed its acquisition of the Wisconsin branches of Huntington. The Corporation paid a 4% premium on acquired deposits. The conversion of the branches happened simultaneously with the close of the transaction and the acquisition expanded the Bank's presence into 13 new Wisconsin communities. As a result of the acquisition and other consolidations, a net of 14 branch locations were added.

The Huntington branch acquisition constituted a business combination. The acquisition has been accounted for using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration exchanged were recorded at estimated fair value on the acquisition date. The determination of estimated fair values required management to make certain estimates that are subjective in nature and may require adjustments upon the availability of new information regarding facts and circumstances which existed at the date of acquisition (i.e., appraisals) for up to a year following the acquisition.

The Corporation recorded approximately $7 million in goodwill related to the Huntington branch acquisition during the second quarter of 2019 and approximately $210,000 during the third quarter of 2019. Upon review of information relating to events and circumstances existing at the acquisition date, and in accordance with applicable accounting guidance, the Corporation remeasured select previously reported fair value amounts. The adjustment to goodwill was driven by an update that decreased the fair value of furniture acquired. Goodwill created by the acquisition is tax deductible. See Note 8 for additional information on ~~goodwill, as well as the carrying amount and amortization~~goodwill.

Table of ~~core deposit intangible assets related to the Huntington branch acquisition.~~Contents

The following table presents the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date related to Huntington branch acquisition:

($ in Thousands)
Purchase Accounting Adjustments June 14, 2019
Assets
Cash and cash equivalents $ —
$ 551,250
Loans (1,552 ) 116,346
Premises and equipment, net 4,800
22,430
Goodwill 7,286
Core deposit intangibles (included in other intangible assets, net on the face of the consolidated balance sheets) 22,630
22,630
OREO (included in other assets on the face of the consolidated balance sheets) (2,561 ) 5,263
Other assets —
559
Total assets $ 725,764
Liabilities
Deposits $ 156
$ 725,173
Other liabilities 70
590
Total liabilities $ 725,764


($ in Thousands)	Purchase Accounting Adjustments		June 14, 2019
Assets
Cash and cash equivalents	$	—	$	551,250


Loans	(1,552)		116,346
Premises and equipment, net	4,800		22,430

Goodwill			7,286
Core deposit intangibles (included in other intangible assets, net on the face of the consolidated balance sheets)	22,630		22,630
OREO (included in other assets on the face of the consolidated balance sheets)	(2,561)		5,263
Other assets	—		559
Total assets			$	725,764
Liabilities
Deposits	$	156	$	725,173

Other liabilities	70		590
Total liabilities			$	725,764

Assumptions

Investment Securities: The ~~following is a description of the methods used to determine the~~ fair value of ~~significant assets and liabilities presented~~investments on the ~~balance sheet above.~~date of acquisition was determined utilizing an external third party broker opinion of the market value.

Loans: Fair values for loans were based on a discounted cash flow methodology that considered factors including the type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, amortization status and current discount rates. ~~Loans~~For the non-credit (interest and liquidity) premium, loans were grouped together according to similar characteristics when applying various valuation techniques. For the credit discount, loans were also grouped based on whether they had more than insignificant deterioration in credit since origination.

~~Core deposit intangible:~~CDIs: This intangible asset represents the value of the relationships with deposit customers. The fair value was estimated based on a discounted cash flow methodology that gave appropriate consideration to expected customer attrition rates, net maintenance cost of the deposit base, alternative cost of funds, and the interest costs associated with customer deposits. The ~~CDI~~CDIs will be amortized on a straight-line basis over 10 years.

~~Other Acquisitions~~Time Deposits: The fair value for time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered to the contractual interest rates on such time deposits.

OnFHLB Borrowings: ~~July 25, 2019, the Corporation entered into an agreement to acquire Illinois-based First Staunton for cash consideration~~The fair value of approximately $76 million. Upon completion of the transaction, the Bank expects to acquire approximately $350 million in loans, approximately $440 million in deposits, and 9 branches. Regulatory approvalFHLB advances are estimated based on quoted market prices for the ~~transaction was received from the OCC~~instrument if available, or for similar instruments if not available, or by using discounted cash flow analyses, based on ~~October 10, 2019. The transaction is subject to customary closing conditions, and is expected to close in first quarter~~current incremental borrowing rates for similar types of ~~2020.~~instruments.

Note 3 Summary of Significant Accounting Policies

The accounting and reporting policies of the Corporation conform to U.S. GAAP and to general practice within the financial services industry. A discussion of these policies can be found in Note 1 Summary of Significant Accounting Policies included in the Corporation’s ~~2018~~2019 Annual Report on Form 10-K. ~~There~~As a result of adopting ASU 2016-13 Financial Instruments - Credit Losses (Topic 326), there have been ~~two~~ changes to the Corporation's significant accounting policies since December 31, ~~2018,~~2019, which are described below.

~~Leases~~Investment Securities

~~The Corporation determines if~~Management measures expected credit losses on held to maturity securities on a ~~lease~~collective basis by major security type. Accrued interest receivable on held to maturity securities is present at the inception of an agreement. Operating leases are capitalized at commencement and are discounted using the Corporation’s FHLB borrowing rate for a similar term borrowing unless the lease defines an implicit rate within the contract. Leases with original terms of less than 12 months are not capitalized. For operating leases existing prior to January 1, 2019, the rate for the remaining lease term as of January 1, 2019 was used.

~~Right-of-use assets represent the Corporation’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising~~excluded from the ~~lease. Operating lease right-of-use assets~~estimate of credit losses. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and ~~operating lease liabilities are recognized on the lease commencement date based on the present value of lease payments over the lease term. No significant judgments or assumptions were involved~~reasonable and supportable forecasts and is included in developing the estimated operating lease liabilities as the Corporation’s operating lease liabilities largely represent future rental expenses associated with operating leases and the borrowing rates are based on publicly available interest rates.

~~The lease term includes options~~investment securities held to extend or terminate the lease. These options to extend or terminate are assessed on a lease-by-lease basis and adjustments are made to the right-of-use asset and lease liability if the Corporation is reasonably certain that an option will be exercised and will be expensed on a straight-line basis.

~~Derivative and Hedging Activities~~

Derivative instruments, including derivative instruments embedded in other contracts, are carried at fair value on the consolidated balance sheets with changes in the fair value recorded to earnings or accumulated other comprehensive income, as appropriate. On the date the derivative contract is entered into, the Corporation designates the derivative as a fair value hedge (i.e., a hedge of the fair value of a recognized asset or liability), a cash flow hedge (i.e., a hedge of the variability of cash flows to be received or paid related to a recognized asset or liability), or a free-standing derivative instrument. For a derivative designated as a fair value hedge, the changes in the fair value of the derivative instrument and the changes in the fair value of the hedged asset or liability are recognized in current period earnings as an increase or decrease to the carrying value of the hedged item on the balance sheet and in the related income statement account. Amounts within accumulated other comprehensive income are reclassified into earnings in the period the hedged item affects earnings. For a derivative designated as a free-standing derivative instrument, changes in fair value are reported in current period earnings. The free-standing derivative instruments included: interest rate risk management, commodity hedging, and foreign currency exchange solutions.

The Corporation is exposed to counterparty credit risk, which is the risk that counterparties to the derivative contracts do not perform as expected. If a counterparty fails to perform, our counterparty credit risk is equal to the amount reported as a derivative asset on our balance sheet. The Corporation uses master netting arrangements to mitigate counterparty credit risk in derivative transactions. To the extent the derivatives are subject to master netting arrangements, the Corporation takes into account the impact of master netting arrangements that allow the Corporation to settle all derivative contracts executed with the same counterparty on a net basis, and to offset the net derivative position with the related cash collateral. In the third quarter of 2019, the Corporation elected to offset derivative transactions with the same counterparty on the consolidated balance sheets when a derivative transaction has a legally enforceable master netting arrangement and when it is eligible for netting. Derivative balances and related cash collateral are presentedmaturity, net on the consolidated balance sheets. ~~Refer~~

For available for sale securities the Corporation evaluates whether any decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to ~~Change~~which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the

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security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses on investments is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses on investments is recognized in ~~Accounting Policy section~~other comprehensive income.

Changes in the allowance for credit losses on investments are recorded as provision for, or reversal of, credit loss expense. Losses are charged against the allowance when management believes the available for sale security is uncollectible or when either of the criteria regarding intent or requirement to sell is met. Accrued interest receivable on available for sale debt securities is excluded from the estimate of credit losses.

Allowance for Credit Losses on Loans

The level of the allowance for loan losses represents management's estimate of an amount appropriate to provide for lifetime credit losses in the loan portfolio at the balance sheet date. The allocation methodology applied by the Corporation, designed to assess the appropriateness of the allowance for loan losses, includes an allocation methodology, as well as management’s ongoing review and grading of the loan portfolio into criticized loan categories. The allocation methodology focuses on evaluation of several factors, including but not limited to: evaluation of facts and issues related to specific loans, management's ongoing review and grading of the loan portfolio using a dual risk rating system leveraging probability of default and loss given default, consideration of historical credit loss and delinquency experience on each portfolio category, trends in past due and nonaccrual loans, the level of potential problem loans, the risk characteristics of the various classifications of loans, changes in the size and character of the loan portfolio, concentrations of loans to specific borrowers or industries, existing economic conditions and economic forecasts, the fair value of underlying collateral, and other qualitative and quantitative factors which could affect potential loan losses. The Corporation utilizes the Moody's Baseline economic forecast in the allowance model and applies that forecast over a reasonable and supportable period with reversion to historical losses. For additional detail on the reasonable and supportable period and reversion methodology, see Note 7 Loans. Potential problem loans are generally defined by management to include loans rated as substandard by management. Assessing these numerous factors involves significant judgment. The provision for loan losses is predominantly a function of the result of the methodology and other qualitative and quantitative factors used to determine the allowance for loan losses.

Management individually analyzes loans that do not share similar risk characteristics to other loans in the portfolio. Management has determined that commercial loan relationships that have nonaccrual status or commercial and retail loans that have had their terms restructured in a TDR meet this definition. Probable TDRs are loans the Corporation has reviewed individually to determine whether there is a high likelihood that the loans will default and will require restructuring in the near future. Probable TDRs could be classified as Pass, Special Mention, Substandard or Nonaccrual within ~~this note~~the Corporation's credit quality analysis depending on the specific circumstances surrounding the individual credits. Accrued interest receivable on loans is excluded from the estimate of credit losses.

The allowance for ~~additional discussion.~~

~~In addition,~~unfunded commitments leverages the same methodology utilized to measure the allowance for loan losses. The Corporation estimates expected credit losses over the contractual period in which the Corporation is exposed to ~~changes in~~credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the ~~fair value of certain pools of prepayable fixed-rate assets due to changes in benchmark interest rates.~~Corporation. The Corporation uses interest rate swaps to manage its exposure to changes in fair value on these instruments attributable to changes in the designated benchmark interest rate. Interest rate swaps designated as fair value hedges involve the payment of fixed-rate amounts to a counterparty in exchange for the Corporation receiving variable-rate payments over the lifeestimate includes consideration of the ~~agreements without the exchange~~likelihood that funding will occur and an estimate of ~~the underlying notional amount. For derivatives designated and that qualify as fair value hedges, the gain or loss~~expected credit losses on ~~the derivative as well as the offsetting loss or gain on the hedged item attributable~~commitments expected to ~~the hedged risk are recognized in interest income.~~be funded over its estimated life. See Note 107 for additional information on ~~derivative~~the ACLL and ~~hedging activities.~~Note 12 for additional information on the allowance for unfunded commitments.

~~Change in Accounting Policy~~

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Impact of adopting ASU 2016-13 Financial Instruments - Credit Losses (Topic 326)

The ~~Corporation enters into ISDA master netting agreements~~following table illustrates the adoption impact:


	December 31, 2019						January 1, 2020
($ in Thousands)	Allowance for Loan Losses		Allowance for Unfunded Commitments		CECL Day 1 Adjustment		ACLL Beginning Balance
Commercial and industrial	$	91,133	$	12,276	$	48,921	$	152,330
Commercial real estate - owner occupied	10,284		127		(1,851)		8,560
Commercial and business lending	101,417		12,403		47,070		160,890
Commercial real estate - investor	40,514		530		2,287		43,331
Real estate construction	24,915		7,532		25,814		58,261
Commercial real estate lending	65,428		8,062		28,101		101,591
Total Commercial	166,846		20,465		75,171		262,482
Residential mortgage	16,960		—		33,215		50,175
Home equity	10,926		1,038		14,240		26,204
Other consumer	6,639		405		8,520		15,564
Total consumer	34,525		1,443		55,975		91,943
Total loans	$	201,371	$	21,907	$	131,147	$	354,425

The allowance for credit losses on held to maturity securities was approximately $61,000 at January 1, 2020, attributable entirely to the Corporation's municipal securities.

At January 1, 2020, the adoption of ASU 2016-13 resulted in an increase to the allowance for loan losses of $112 million and an increase to the allowance for unfunded commitments of $19 million for a total increase to the ACLL of $131 million. A corresponding after tax decrease to common equity of $98 million was recorded along with a portion of the Corporation’s derivative counterparties. Where legally enforceable, these master netting agreements give the Corporation, in the event of default by the counterparty, the right to liquidate securities and offset cash with the same counterparty. Under ASC 815-10-45-5, payables and receivables in respect of cash collateral received from or paid to a given counterparty can be offset against derivative fair values under a master netting arrangement. GAAP does not permit similar offsetting for security collateral. Prior to the third quarter of 2019, the Corporation elected to account for all derivatives’ fair values and related cash collateral on a gross basis on its consolidated balance sheets. In the third quarter of 2019, the Corporation elected to offset derivative assets and liabilities and cash collateral with the same counterparty where it has a legally enforceable master netting agreement in place. The change had no impact on either earnings or equity. The Corporation believes that this change is a preferable method of accounting as it provides a better reflection of the assets and liabilities on the face of the consolidated balance sheets. Adoption of this change is voluntary and has been adopted retrospectively with all prior periods presented herein being revised for comparability and as required. A reductiondeferred tax asset of $33 ~~million was reflected between other assets as well as accrued expenses and other liabilities as of December 31, 2018 on the consolidated balance sheets.~~million.

~~Change in Accounting Estimate~~

During the third quarter of 2019, the Corporation reassessed its estimate of the useful lives of certain fixed assets. The Corporation revised its original useful life estimate from 7 years to 12 years for furniture assets. This is considered a change in accounting estimate, per ASC 250-10, where adjustments should be made prospectively. The impact of this change in accounting estimate for third quarter of 2019 to net income in the consolidated statements of income and premises and equipment, net in the consolidated balance sheets was approximately $230,000.

New Accounting Pronouncements Adopted

Standard

Description

Date of adoption

Effect on financial statements

~~ASU 2019-07~~

Codification Updates to SEC Sections-Amendments to SEC Paragraphs Pursuant to SEC Final Releases No. 33-10532, Disclosure Updates and Simplification, and Nos. 33-10231 and 33-10442, Investment Company Reporting Modernization, and Miscellaneous Updates

~~The FASB issued this amendment to align the guidance in various SEC sections of the Codification with the requirements of certain SEC final rules. This amendment became effective upon issuance.~~

~~3rd Quarter 2019~~

~~No material impact on results of operations, financial position and liquidity.~~

~~ASU 2019-04~~

~~Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments~~

The FASB issued this amendment to clarify certain aspects of accounting for credit losses, hedging activities, and financial instruments. Within ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, the amendment allows an entity to designate partial-term fair value hedges of interest rate risk and measure the hedged item by using an assumed maturity, clarifies that an entity can start to amortize the hedged items basis adjustment in a fair value hedge, and it requires entities to disclose for fair value hedging relationships the carrying amounts of hedged assets and liabilities and the cumulative amount of fair value hedge basis adjustments. In addition, it permits a one-time election to reclassify securities that could be used in a hedge from held to maturity to available for sale without risk of tainting the remainder of the held to maturity portfolio. For entities that have adopted the amendments in Update 2017-12 as of the issuance date of this Update, the effective date is as of the beginning of the first annual period beginning after the issuance date of this Update. For those entities, early adoption was permitted, including adoption on any date on or after the issuance of this Update.

~~3rd Quarter 2019~~

~~During the third quarter of 2019, the Corporation made a one-time election to transfer municipal securities with an amortized cost of $692 million from held to maturity to available for sale.~~

~~ASU-2018-15 Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract~~

The FASB issued an amendment which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The amendments in this Update require an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. The amendments also require the entity (customer) to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. The amendment is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Entities were required to apply the amendment either retrospectively or prospectively to all implementation costs incurred after the date of adoption. Early adoption was permitted.

~~1st Quarter 2019~~

~~The Corporation elected to early adopt this amendment using the prospective approach. No material impact on results of operation, financial position or liquidity.~~



~~Standard~~	~~Description~~	~~Date of adoption~~	~~Effect on financial statements~~
~~ASU 2018-09 Codification Improvements~~	The FASB issued an amendment which affects a wide variety of Topics in the Codification. The amendments apply to all reporting entities within the scope of the affected accounting guidance. The amendments in this Update represent changes to clarify, correct errors in, or make minor improvements to the Codification. The amendments make the Codification easier to understand and easier to apply by eliminating inconsistencies and providing clarifications. The transition and effective date guidance is based on the facts and circumstances of each amendment. Some of the amendments in this Update did not require transition guidance and were effective upon issuance of this Update. However, many of the amendments in this Update did have transition guidance with effective dates for annual periods beginning after December 15, 2018. There are some conforming amendments in this Update that have been made to recently issued guidance that is not yet effective that may require application of the transition and effective date guidance in the original ASU.	~~1st Quarter 2019~~	~~No material impact on results of operations, financial position and liquidity.~~
~~ASU 2016-02 Leases (Topic 842)~~	The FASB issued an amendment to provide transparency and comparability among organizations by recognizing lease assets and lease liabilities on the consolidated balance sheets and disclosing key information about leasing arrangements. This amendment required lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: 1) a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis; and 2) a right-of-use asset, which is an asset that represents the lessee's right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. This amendment was effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018. Entities are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities could elect to apply. These practical expedients relate to the identification and classification of leases that commenced before the effective date, initial direct costs for leases that commenced before the effective date, and the ability to use hindsight in evaluating lessee options to extend or terminate a lease or to purchase the underlying asset. Early adoption was permitted. ASU 2018-01 permits an entity to elect an optional transition practical expedient to not evaluate under Topic 842 land easements that exist or expired before the entity's adoption of Topic 842. ASU 2018-10 was issued as improvements and clarifications of ASU 2016-02 were identified. This Update provides clarification on narrow aspects of the previously issued Updates. ASU 2018-11 was issued to provide entities with an additional (and optional) transition method to adopt the new leases standard under ASU 2016-02. ASU 2019-01 was issued to assist in determining the fair value of underlying asset by lessors, address the presentation to the statements of cash flows, and clarify transition disclosures related to Topic 250.	~~1st Quarter 2019~~	The Corporation has adopted this amendment utilizing a modified retrospective approach. At adoption, a right-of-use asset and corresponding lease liability were recognized on the consolidated balance sheets for $52 million and $56 million, respectively. See Note 18 for expanded disclosure requirements.

~~Future Accounting Pronouncements~~

~~The expected impact of accounting pronouncements recently issued or proposed but not yet required to be adopted are displayed in the table below:~~

~~Standard~~

~~Description~~

~~Date of anticipated adoption~~

~~Effect on financial statements~~

ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

The FASB issued an amendment to replace the current incurred loss impairment methodology. Under the new guidance, entities will be required to measure expected credit losses by utilizing forward-looking information to assess an entity's ~~allowance for credit losses.~~ACL. The guidance also requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. This amendment iswas effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities should apply the amendment by means of a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. ASU 2018-19 was issued to clarify that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases. ASU 2019-04 was issued and provides entities alternatives for measurement of accrued interest receivable, clarifies the steps entities should take when recording the transfer of loans or debt securities between measurement classifications or categories and clarifies that entities should include expected recoveries on financial assets. ASU 2019-05 was issued to provide entities that have certain instruments within the scope of Subtopic 320-20 with an option to irrevocably elect the fair value option in Subtopic 825-10. ASU 2020-02 was issued to further explain the measurement of current expected credit losses and the development, governance, and documentation of a systematic methodology. Early adoption iswas permitted.

1st Quarter 2020

The Corporation has adopted the Update using a modified retrospective approach. The Corporation has developed a CECL allowance model which calculates reserves over the life of the loan and is largely driven by portfolio characteristics, risk-grading, economic outlook, and key methodology assumptions. Those assumptions are based upon the existing probability of default and loss given default ~~framework and existing DFAST systems. The~~framework. At adoption, the Corporation ~~will utilize~~utilized a single economic forecast over a ~~1-year~~2-year reasonable and supportable forecast ~~period with 1-year~~period. In the second year, the Corporation used straight-line reversion to historical losses. The ~~Corporation's cross functional team is currently performing parallel testing and sensitivity analysis and will refine~~Corporation recorded a $131 million adjustment to the ~~model as needed.~~ACL related to the adoption of this standard, which includes $61 thousand related to the held to maturity investment securities portfolio. The Corporation ~~anticipates a 30-40% increase in~~has elected to maintain pools accounted for under Subtopic 310-30 at adoption. The Corporation has elected to utilize the ~~allowance~~2019 Capital Transition Relief for ~~credit losses from projected year-end 2019 levels. A majority of~~initial adoption, as well as the ~~increase is the result of economic uncertainty.~~2020 Capital Transition Relief as permitted under applicable regulations. The total ~~estimated~~ impact at adoption equates to an approximately 2529 bp net, after tax, reduction in ~~expected~~the tangible common ~~equity. The Corporation anticipates increases~~equity ratio. Results for the periods after January 1, 2020 are presented in ~~the longer dated portfolios and decreases~~accordance with ASC 326 while prior period amounts continue to be reported in the shorter dated portfolios. The Corporation is in the process of finalizing model validations and approval of all models and assumptions through the steering committee which may have an impact on the estimate provided. The overall estimate for CECL is largely dependent on the composition of the portfolio, credit quality and economic conditions and forecasts at the time of adoption.

accordance with previously applicable standards.

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~~Standard~~

~~Description~~

Standard

Description

Date of ~~anticipated~~ adoption

Effect on financial statements

ASU 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement

The FASB issued an amendment to add, modify, and remove disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the FASB Concepts Statement "Conceptual Framework for Financial ~~Reporting",~~Reporting," including the consideration of costs and benefits. The amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption iswas permitted.

1st Quarter 2020

The Corporation ~~is currently evaluating the~~has evaluated and determined it has an immaterial impact ~~on its results of operations, financial position and liquidity.~~with minor changes in presentation.

ASU 2017-04 Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment

The FASB issued an amendment to simplify the subsequent quantitative measurement of goodwill by eliminating step two from the goodwill impairment test. Instead, an entity will perform only step one of its quantitative goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and then recognizing an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity will still have the option to perform a qualitative assessment for a reporting unit to determine if the quantitative step one impairment test is necessary. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Entities should apply the amendment prospectively. Early adoption is permitted, including in an interim period, for impairment tests performed after January 1, 2017.

~~2nd~~1st Quarter 2020 ~~consistent with the Corporation's annual impairment test in May of each year.~~

~~The Corporation is currently evaluating the~~There has been no material impact on ~~its~~ results of operations, financial position, and liquidity. The Corporation ~~has not had to perform a step one quantitative analysis since 2012, which concluded no~~does its annual impairment ~~was necessary.~~testing in May.

ASU 2020-03 Codification Improvements to Financial Instruments

The FASB issued an amendment to further clarify that all entities are required to provide the fair value option disclosures in paragraphs 825-10-50-24 through 50-32. The amendment also states that paragraphs 820-10-35-2A(g) and 820-10-35-18L are to include the phrase nonfinancial items accounted for as derivatives under Topic 815 to be consistent with the previous amendments to Section 820-10-35 that were made by ASU No. 2018-09, Codification Improvements. The amendment also clarifies that the disclosure requirements in Topic 320 apply to the disclosure requirements in Topic 942 for depository and lending institutions along with improving the understandability of the guidance relating to subtopic 470-50 and subtopic 820-10. Lastly, the amendment clarifies that the contractual term of a net investment in a lease determined in accordance with Topic 842 should be the contractual term used to measure expected credit losses under Topic 326 and that when an entity regains control of financial assets sold, an ACL should be recorded in accordance with Topic 326.

1st Quarter 2020

The Corporation has evaluated and determined it has an immaterial impact.

ASU 2020-04 Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

The FASB issued an amendment to provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendment only applies to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship.

1st Quarter 2020

The Corporation has evaluated the impact of the Update and determined the expedients provided allow for simpler, more streamlined modifications to the financial instruments referencing LIBOR. A small population of loans have been modified under the new standard.

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Future Accounting Pronouncements

The expected impact of accounting pronouncements recently issued or proposed but not yet required to be adopted are displayed in the table below:

Standard

Description

Date of anticipated adoption

Effect on financial statements

ASU 2018-14
Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans

The FASB issued an amendment to modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The amendments also added requirements to disclose the weighted-average interest crediting rates for cash balance plans and other plans with promised interest crediting rates and an explanation of the reasons for significant gains and losses related to changes in the benefit obligation for the period. The amendment also clarifies the disclosure requirements in paragraph 715-20-50-3, which states that certain information for defined benefit pension plans should be disclosed. The amendments in this Update remove disclosures that no longer are considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as relevant. The amendment is effective for fiscal years ending after December 15, 2020. Entities should apply the amendments in this Update on a retrospective basis to all periods presented. Early adoption is permitted.

1st Quarter 2021

The Corporation is currently evaluating the impact on its results of operations, financial position, and liquidity.

ASU 2020-01 Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)

Clarifying the Interactions between Topic 321, Topic 323, and Topic 815

The FASB issued an amendment to clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. The amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. The amendments also clarify that for the purpose of applying paragraph 815-10-15-141(a) an entity should not consider whether, upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method in Topic 323 or the fair value option in accordance with the financial instruments guidance in Topic 825. An entity also would evaluate the remaining characteristics in paragraph 815-010-15-141 to determine the accounting for those forward contracts and purchased options.

1st Quarter 2021

The Corporation is currently evaluating the impact on its results of operations, financial position, and liquidity.

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Note 4 Earnings Per Common Share

Earnings per common share are calculated utilizing the two-class method. Basic earnings per common share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per common share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding adjusted for the dilutive effect of common stock awards (outstanding stock options and unvested restricted stock awards) ~~and common stock warrants.~~. Presented below are the calculations for basic and diluted earnings per common share:

For the Three Months Ended September 30, For the Nine Months Ended September 30,
(In Thousands, except per share data)
2019 2018 2019 2018
Net income $ 83,339
$ 85,929
$ 254,686
$ 244,578
Preferred stock dividends (3,801 ) (2,409 ) (11,402 ) (7,077 )
Net income available to common equity $ 79,539
$ 83,521
$ 243,285
$ 237,501
Common shareholder dividends (27,091 ) (25,486 ) (82,741 ) (77,035 )
Unvested share-based payment awards (198 ) (128 ) (506 ) (396 )
Undistributed earnings $ 52,250
$ 57,907
$ 160,037
$ 160,070
Undistributed earnings allocated to common shareholders 51,870
57,620
158,970
159,297
Undistributed earnings allocated to unvested share-based payment awards 380
288
1,067
772
Undistributed earnings $ 52,250
$ 57,907
$ 160,037
$ 160,070
Basic

Distributed earnings to common shareholders $ 27,091
$ 25,486
$ 82,741
$ 77,035
Undistributed earnings allocated to common shareholders 51,870
57,620
158,970
159,297
Total common shareholders earnings, basic $ 78,961
$ 83,106
$ 241,711
$ 236,332
Diluted

Distributed earnings to common shareholders $ 27,091
$ 25,486
$ 82,741
$ 77,035
Undistributed earnings allocated to common shareholders 51,870
57,620
158,970
159,297
Total common shareholders earnings, diluted $ 78,961
$ 83,106
$ 241,711
$ 236,332
Weighted average common shares outstanding 159,126
170,516
161,727
168,249
Effect of dilutive common stock awards 1,256
2,188
1,334
2,101
Effect of dilutive common stock warrants —
98
—
526
Diluted weighted average common shares outstanding 160,382
172,802
163,061
170,876
Basic earnings per common share $ 0.50
$ 0.49
$ 1.49
$ 1.40
Diluted earnings per common share $ 0.49
$ 0.48
$ 1.48
$ 1.38


	Three Months Ended March 31,
(In Thousands, except per share data)	2020		2019
Net income	$	45,838	$	86,686
Preferred stock dividends	(3,801)		(3,801)
Net income available to common equity	42,037		82,885
Common shareholder dividends	(28,264)		(28,080)
Unvested share-based payment awards	(128)		(103)
Undistributed earnings	$	13,645	$	54,702
Undistributed earnings allocated to common shareholders	$	13,555	$	54,410
Undistributed earnings allocated to unvested share-based payment awards	90		292
Undistributed earnings	$	13,645	$	54,702
Basic
Distributed earnings to common shareholders	$	28,264	$	28,080
Undistributed earnings allocated to common shareholders	13,555		54,410
Total common shareholders earnings, basic	$	41,819	$	82,490
Diluted
Distributed earnings to common shareholders	$	28,264	$	28,080
Undistributed earnings allocated to common shareholders	13,555		54,410
Total common shareholders earnings, diluted	$	41,819	$	82,490
Weighted average common shares outstanding	154,701		163,928
Effect of dilutive common stock awards	918		1,505

Diluted weighted average common shares outstanding	155,619		165,433
Basic earnings per common share	$	0.27	$	0.50
Diluted earnings per common share	$	0.27	$	0.50

Non-dilutive common stock options of approximately 34 million and 13 million for the three months ended ~~September 30,~~March 31, 2020 and 2019, ~~and 2018, respectively, and 3 million and 1 million for the nine months ended September 30, 2019 and 2018,~~ respectively, were excluded from the earnings per common share calculation.

Note 5 Stock-Based Compensation

The fair value of stock options granted is estimated on the date of grant using a Black-Scholes option pricing model, while the fair value of restricted stock awards is their fair market value on the date of grant. The fair values of stock options and restricted stock awards are amortized as compensation expense on a straight-line basis over the vesting period of the grants. For retirement eligible colleagues, whose employment meets the definitions under the 2017 Incentive Compensation Plan, expenses related to stock options and restricted stock awards are fully recognized on the date the colleague meets the definition of normal or early retirement. Compensation expense recognized is included in personnel expense inon the consolidated statements of income.

Assumptions are used in estimating the fair value of stock options granted. The weighted average expected life of the stock option represents the period of time stock options are expected to be outstanding and is estimated using historical data of stock option exercises and forfeitures. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The expected volatility is based on the implied volatility of the Corporation’s stock.

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The following assumptions were used in estimating the fair value for options granted in the first three months of 2020 and full year 2019:


	2020		2019
Dividend yield	3.50	%	3.30	%
Risk-free interest rate	1.60	%	2.60	%
Weighted average expected volatility	21.00	%	24.00	%
Weighted average expected life	5.75 years		5.75 years
Weighted average per share fair value of options	$2.39		$4.00

A summary of the Corporation’s stock option activity for the three months ended March 31, 2020 is presented below:


Stock Options	Shares^(a)	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value^(a)
Outstanding at December 31, 2019	5,543	$	20.13	6.25 years	$	16,043
Granted	1,697	18.43
Exercised	(102)	13.98
Forfeited or expired	(159)	22.52
Outstanding at March 31, 2020	6,978	$	19.75	6.96 years	$	19
Options Exercisable at March 31, 2020	4,090	$	19.15	5.37 years	$	19

(a) In thousands

Intrinsic value represents the amount by which the fair market value of the underlying stock exceeds the exercise price of the stock option. For the three months ended March 31, 2020, the intrinsic value of stock options exercised was less than $1 million compared to $2 million for the three months ended March 31, 2019. The total fair value of stock options vested was $3 million for the three months ended March 31, 2020, compared to $4 million for the three months ended March 31, 2019.

The Corporation recognized compensation expense for the vesting of stock options of $2 million for the three months ended March 31, 2020 and $1 million for the three months ended March 31, 2019. Included in compensation expense for 2020 was less than $1 million of expense for the accelerated vesting of stock options granted to retirement eligible colleagues. At March 31, 2020, the Corporation had approximately $6 million of unrecognized compensation expense related to stock options that is expected to be recognized over the remaining requisite service periods that extend through the first quarter of 2024.

The Corporation also issues restricted stock awards under the 2017 Incentive Compensation Plan. Performance awards are based on performance goals of earnings per share and total shareholder return with vesting ranging from a minimum of 0% to a maximum of 150% of the target award. Performance awards are valued utilizing a Monte Carlo simulation model to estimate fair value of the awards at the grant date.

option exercises and forfeitures. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The expected volatility is based on the implied volatility of the Corporation’s stock.

~~The following assumptions were used in estimating the fair value for options granted in the first nine months of 2019 and full year 2018:~~

2019 2018
Dividend yield 3.30 % 2.50 %
Risk-free interest rate 2.60 % 2.60 %
Weighted average expected volatility 24.00 % 22.00 %
Weighted average expected life 5.75 years
5.75 years
Weighted average per share fair value of options $4.00 $4.47

~~A summary of the Corporation’s stock option activity for the nine months ended September 30, 2019 is presented below:~~

Stock Options
Shares^(a)
Weighted Average
Exercise Price
Weighted Average Remaining Contractual Term
Aggregate Intrinsic Value^(a)
Outstanding at December 31, 2018 5,281
$ 19.09
6.18 $ 12,392
Granted 1,050
22.77

Exercised (498 ) 15.57

Forfeited or expired (114 ) 22.42

Outstanding at September 30, 2019 5,718
$ 20.01
6.43 $ 11,541
Options Exercisable at September 30, 2019 3,535
$ 18.12
5.14 $ 10,901

~~(a) In thousands~~

Intrinsic value represents the amount by which the fair market value of the underlying stock exceeds the exercise price of the stock option. For the nine months ended September 30, 2019, the intrinsic value of stock options exercised was approximately $3 million, compared to $10 million for the nine months ended September 30, 2018. The total fair value of stock options vested was $4 million for the nine months ended September 30, 2019 and 2018.

The Corporation recognized compensation expense for the vesting of stock options of $4 million for the nine months ended September 30, 2019 and $3 million for the nine months ended September 30, 2018. Included in compensation expense for 2019 was $1 million of expense for the accelerated vesting of stock options granted to retirement eligible colleagues. At September 30, 2019, the Corporation had approximately $5 million of unrecognized compensation expense related to stock options that is expected to be recognized over the remaining requisite service periods that extend through first quarter 2023.

~~The Corporation also issues restricted stock awards under the 2017 Incentive Compensation Plan.~~ The following table summarizes information about the Corporation’s restricted stock awards activity for the ~~nine~~three months ended ~~September 30, 2019:~~March 31, 2020:

Restricted Stock Awards
Shares^(a)

Weighted Average
Grant Date Fair Value
Outstanding at December 31, 2018 1,993
$ 21.92
Granted 1,172
22.20
Vested (693 ) 20.56
Forfeited (67 ) 23.85
Outstanding at September 30, 2019 2,405
$ 22.39


Restricted Stock Awards	Shares^(a)	Weighted Average Grant Date Fair Value
Outstanding at December 31, 2019	2,393	$	22.39
Granted	1,018	18.54
Vested	(752)	23.33
Forfeited	(61)	23.12
Outstanding at March 31, 2020	2,598	$	20.59

(a) In thousands

The Corporation amortizes the expense related to restricted stock awards as compensation expense over the vesting period specified in the grant's award agreement. Performance-based restricted stock awards granted during ~~2018~~2019 and ~~2019~~2020 will vest ratably over a period of three years. Service-based restricted stock awards granted during ~~2018~~2019 and ~~2019~~2020 will vest ratably over a period of four years. Expense for restricted stock awards issued of approximately ~~$18~~$9 million was recorded for the ~~nine~~three months ended ~~September 30, 2019~~March 31, 2020 and ~~$10~~$8 million was recorded for the ~~nine~~three months ended ~~September 30, 2018.~~March 31, 2019. Included in compensation expense for the first ~~nine~~three months of ~~2019~~2020 was approximately $3$2 million of expense for the accelerated vesting of restricted stock awards granted to retirement eligible colleagues. The Corporation had ~~$23~~$27 million of unrecognized compensation costs related to restricted stock awards at ~~September 30, 2019~~March 31, 2020 that are expected to be recognized over the remaining requisite service periods that extend through the first quarter ~~2023.~~

of 2024.

The Corporation has the ability to issue shares from treasury or new shares upon the exercise of stock options or the granting of restricted stock awards. The Board of Directors has authorized management to repurchase shares of the Corporation’s common

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stock in the market, to be made available for issuance in connection with the Corporation’s employee incentive plans and for other corporate purposes. The repurchase of shares will be based on market and investment opportunities, capital levels, growth prospects, and regulatory constraints. Such repurchases may occur from time to time in open market purchases, block transactions, private transactions, accelerated share repurchase programs, or similar facilities.

Note 6 Investment Securities

Investment securities are ~~generally~~ classified as available for sale, or held to maturity, or equity on the consolidated balance sheets at the time of purchase. The amortized cost and fair values of securities available for sale and held to maturity at ~~September 30, 2019~~March 31, 2020 were as follows:


($ in Thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value


Investment securities available for sale

U.S. government SBA agency securities	$	10,241	$	2	$	(5)	$	10,238
Obligations of state and political subdivisions (municipal securities)	492,195		16,443		(1)		508,636
Residential mortgage-related securities
FNMA / FHLMC	103,576		908		—		104,485
GNMA	799,983		23,804		—		823,787

Commercial mortgage-related securities
FNMA / FHLMC	19,861		2,912		—		22,773
GNMA	1,108,336		10,162		(4,055)		1,114,443
FFELP asset backed securities	360,658		—		(19,234)		341,424

Other debt securities	3,000		—		—		3,000
Total investment securities available for sale	$	2,897,851	$	54,231	$	(23,295)	$	2,928,787
Investment securities held to maturity
U. S. Treasury securities	$	999	$	42	$	—	$	1,041
Obligations of state and political subdivisions (municipal securities)	1,426,543		82,382		(475)		1,508,451
Residential mortgage-related securities
FNMA / FHLMC	78,125		3,486		—		81,610
GNMA	245,675		8,124		—		253,799
GNMA commercial mortgage-related securities	398,092		6,500		(1,939)		402,653
Total investment securities held to maturity	$	2,149,434	$	100,534	$	(2,414)	$	2,247,553

($ in Thousands)
Amortized
Cost

Gross
Unrealized
Gains

Gross
Unrealized
(Losses)
Fair Value

Investment securities available for sale

Obligations of state and political subdivisions (municipal securities)^(a)
$ 535,977
$ 17,441
$ —
$ 553,418
Residential mortgage-related securities
FNMA / FHLMC 141,678
1,657
(326 ) 143,009
GNMA 1,075,922
5,983
(1,322 ) 1,080,584
Private-label 749
9
—
758
Commercial mortgage-related securities
FNMA / FHLMC 19,996
1,795
—
21,791
GNMA 1,363,848
10,095
(9,996 ) 1,363,948
FFELP asset backed securities 272,871
40
(3,123 ) 269,789
Other debt securities 3,000
—
(7 ) 2,993
Total investment securities available for sale $ 3,414,042
$ 37,021
$ (14,774 ) $ 3,436,289
Investment securities held to maturity
U. S. Treasury securities $ 999
$ 21
$ —
$ 1,019

Obligations of state and political subdivisions (municipal securities)^(a)
1,346,234
73,235
(733 ) 1,418,736
Residential mortgage-related securities
FNMA / FHLMC 86,140
1,467
(17 ) 87,590
GNMA 295,370
4,832
(94 ) 300,108
GNMA commercial mortgage-related securities 471,675
7,115
(4,959 ) 473,832
Total investment securities held to maturity $ 2,200,419
$ 86,669
$ (5,803 ) $ 2,281,285

~~(a) As permitted by ASU 2019-04, which was adopted during the third quarter~~Table of ~~2019, the Corporation made a one-time election to transfer municipal securities with an amortized cost of $692 million from held to maturity to available for sale.~~Contents

The amortized cost and fair values of securities available for sale and held to maturity at December 31, ~~2018~~2019 were as follows:

($ in Thousands) Amortized
Cost Gross
Unrealized
Gains Gross
Unrealized
(Losses) Fair Value

Investment securities available for sale
U. S. Treasury securities $ 1,000
$ —
$ (1 ) $ 999
Residential mortgage-related securities
FNMA / FHLMC 296,296
2,466
(3,510 ) 295,252
GNMA 2,169,943
473
(41,885 ) 2,128,531
Private-label 1,007
—
(4 ) 1,003
GNMA commercial mortgage-related securities 1,273,309
—
(52,512 ) 1,220,797
FFELP asset backed securities 297,347
711
(698 ) 297,360
Other debt securities 3,000
—
—
3,000
Total investment securities available for sale $ 4,041,902
$ 3,649
$ (98,610 ) $ 3,946,941
Investment securities held to maturity
Obligations of state and political subdivisions (municipal securities) $ 1,790,683
$ 8,255
$ (15,279 ) $ 1,783,659
Residential mortgage-related securities
FNMA / FHLMC 92,788
169
(1,795 ) 91,162
GNMA 351,606
1,611
(8,181 ) 345,035
GNMA commercial mortgage-related securities 505,434
7,559
(22,579 ) 490,414
Total investment securities held to maturity $ 2,740,511
$ 17,593
$ (47,835 ) $ 2,710,271


($ in Thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value


Investment securities available for sale

Obligations of state and political subdivisions (municipal securities)	$	529,908	$	16,269	$	(18)	$	546,160
Residential mortgage-related securities
FNMA / FHLMC	131,158		1,562		(59)		132,660
GNMA	982,941		3,887		(1,689)		985,139

Commercial mortgage-related securities
FNMA / FHLMC	19,929		1,799		—		21,728
GNMA	1,314,836		7,403		(12,032)		1,310,207
FFELP asset backed securities	270,178		—		(6,485)		263,693

Other debt securities	3,000		—		—		3,000
Total investment securities available for sale	$	3,251,950	$	30,920	$	(20,284)	$	3,262,586
Investment securities held to maturity
U. S. Treasury securities	$	999	$	19	$	—	$	1,018
Obligations of state and political subdivisions (municipal securities)	1,418,569		69,775		(1,118)		1,487,227
Residential mortgage-related securities
FNMA / FHLMC	81,676		1,759		(15)		83,420
GNMA	269,523		1,882		(1,108)		270,296
GNMA commercial mortgage-related securities	434,317		6,308		(6,122)		434,503
Total investment securities held to maturity	$	2,205,083	$	79,744	$	(8,363)	$	2,276,465

Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The expected maturities of investment securities available for sale and held to maturity at ~~September 30, 2019~~March 31, 2020 are shown below:


	Available for Sale							Held to Maturity
($ in Thousands)	Amortized Cost		Fair Value			Amortized Cost		Fair Value
Due in one year or less	$	10,731	$	10,738		$	32,555	$	32,703
Due after one year through five years	30,829		31,242			77,586		78,683
Due after five years through ten years	324,501		334,499			153,519		158,843
Due after ten years	129,134		135,157			1,163,883		1,239,262
Total debt securities	495,195		511,636			1,427,542		1,509,492
U.S. government SBA agency securities	10,241		10,238			—		—
Residential mortgage-related securities
FNMA / FHLMC	103,576		104,485			78,125		81,610
GNMA	799,983		823,787			245,675		253,799

Commercial mortgage-related securities
FNMA / FHLMC	19,861		22,773			—		—
GNMA	1,108,336		1,114,443			398,092		402,653
FFELP asset backed securities	360,658		341,424			—		—

Total investment securities	$	2,897,851	$	2,928,787		$	2,149,434	$	2,247,553
Ratio of fair value to amortized cost			101.1		%			104.6		%

Available for Sale Held to Maturity
($ in Thousands)
Amortized
Cost

Fair
Value

Amortized
Cost

Fair
Value
Due in one year or less $ 3,045
$ 3,049
$ 29,063
$ 29,208
Due after one year through five years 24,894
25,227
91,045
92,075
Due after five years through ten years 295,533
304,383
128,365
132,716
Due after ten years 215,505
223,752
1,098,760
1,165,757
Total debt securities 538,977
556,411
1,347,233
1,419,755
Residential mortgage-related securities
FNMA / FHLMC 141,678
143,009
86,140
87,590
GNMA 1,075,922
1,080,584
295,370
300,108
Private-label 749
758
—
—
Commercial mortgage-related securities
FNMA / FHLMC 19,996
21,791
—
—
GNMA 1,363,848
1,363,948
471,675
473,832
FFELP asset backed securities 272,871
269,789
—
—
Total investment securities $ 3,414,042
$ 3,436,289
$ 2,200,419
$ 2,281,285
Ratio of fair value to amortized cost 100.7 % 103.7 %

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On a quarterly basis, the Corporation refreshes credit quality of each held to maturity security. The following table summarizes the credit quality indicator of held to maturity securities at amortized cost at March 31, 2020:


($ in Thousands)	AAA		AA		A			Total
U. S. Treasury securities	$	999	$	—	$	—		$	999
Obligations of state and political subdivisions (municipal securities)	543,620		862,040		20,883			1,426,543
Residential mortgage-related securities
FNMA/FHLMC	78,125		—		—		��	78,125
GNMA	245,675		—		—			245,675
GNMA commercial mortgage-related securities	398,092		—		—			398,092
Total held to maturity securities	$	1,266,510	$	862,040	$	20,883		$	2,149,434

Investment securities gains (losses), net includes proceeds from the sale of investment securities as well as any applicable write-ups or write-downs of investment securities. The proceeds from the sale ~~and write-up~~ of investment securities for the ~~nine~~three months ended ~~September 30,~~March 31, 2020 and 2019 ~~and 2018~~ are shown below:

Nine Months Ended September 30,
($ in Thousands) 2019 2018
Gross gains on available for sale securities $ 6,347
$ 1,954
Gross gains on held to maturity securities —
—
Total gains 6,347
1,954
Gross (losses) on available for sale securities (13,861 ) (3,938 )
Gross (losses) on held to maturity securities —
—
Total (losses) (13,861 ) (3,938 )
Write-up of equity securities without readily determinable fair values 13,444
—
Investment securities gains (losses), net $ 5,931
$ (1,985 )
Proceeds from sales of investment securities $ 1,367,450
$ 601,130


	Three Months Ended March 31,
($ in Thousands)	2020		2019
Gross gains on available for sale securities	$	6,198	$	1,680
Gross gains on held to maturity securities	—		—
Total gains	6,198		1,680
Gross (losses) on available for sale securities	(80)		—
Gross (losses) on held to maturity securities	—		—
Total (losses)	(80)		—

Investment securities gains (losses), net	$	6,118	$	1,680
Proceeds from sales of investment securities	$	365,239	$	131,122

During the ~~third~~first quarter of 2020, the Corporation sold $281 million of primarily prepayment sensitive mortgage-related securities at a gain of $6 million. Additionally, in February 2020, the Corporation sold $84 million of certain securities acquired in the First Staunton acquisition that did not fit the parameters of the Corporation's current investment strategy.

During the first quarter of 2019, the Corporation ~~made a one-time election to transfer municipal securities with an amortized cost of $692~~sold $131 million from held to maturity to available for sale, as permitted by the adoption of ASU 2019-04 during the quarter. The Corporation sold shorter duration, lower yielding municipal securities that were included in the transfer for proceeds of $157 million at a gain of $3 million, with the proceeds being reinvested into longer duration, higher yielding held to maturity municipal securities. Additionally, during the first nine months of 2019, the Corporation sold $1.2 billion of taxable ~~floating rate~~ ABS, ~~and shorter duration~~ MBS, ~~CMBS,~~ and CMO ~~Agency~~ securities, with the proceeds utilized to pay down ~~borrowings and to reinvest into higher yielding Agency related mortgage securities with slightly longer durations, repositioning the portfolio for a declining rate environment.~~

The Corporation also donated 42,039 shares of Visa Class B restricted shares to the Corporation's Charitable Remainder Trust during the second quarter of 2019, and the subsequent sale of those shares by the Trust resulted in an observable market price. As a result, the Corporation wrote up its remaining 77,000 Visa Class B restricted shares to fair value. Based on the existing transfer restriction and the uncertainty of covered litigation, the shares were previously carried at a zero cost basis.

During 2018, the Corporation executed a strategy to improve the yield on securities and increase interest income during the current and future calendar years. During the third quarter of 2018, the Corporation sold mortgage-related securities totaling approximately $108 million at a slight gain with all the proceeds reinvested into higher-yielding securities. The taxable equivalent yield of the securities sold was 3.08% while the reinvestment was at 3.51%. During the first six months of 2018, the Corporation also sold $40 million of lower yielding GNMA commercial mortgage-related securities.

In addition, on February 1, 2018, the date the Bank Mutual acquisition was completed, the Corporation sold Bank Mutual's entire $453 million securities portfolio. The Corporation originally reinvested the proceeds from the Bank Mutual securities portfolio into GNMA residential mortgage-related securities with the goal of reinvesting future cash flows into municipal securities. That strategy was completed during August 2018.borrowings.

Investment securities with a carrying value of approximately ~~$3.0~~$2.1 billion and $2.6 billion at ~~both September 30, 2019~~March 31, 2020 and December 31, ~~2018~~2019, respectively, were ~~required to be~~ pledged to secure certain deposits or for other purposes as required or permitted by law.

At March 31, 2020, accrued interest receivable on held to maturity and available for sale securities totaled $14 million and $10 million, respectively, both which are included in interest receivable on the consolidated balance sheets. There was 0 interest income reversed for investments going into nonaccrual.

A security is considered past due once it is 30 days contractually past due under the terms of the agreement. At March 31, 2020, the Corporation had 0 past due held to maturity securities.

The allowance for credit losses on held to maturity securities was approximately $61,000 at March 31, 2020, attributable entirely to the Corporation's municipal securities, included in investment securities held to maturity, net, at amortized cost on the consolidated balance sheets. The Corporation also holds U.S. Treasury and residential mortgage-related securities issued by the U.S. government or a GSE which are backed by the full faith and credit of the U.S. government and, as a result, no allowance for credit losses has been recorded related to these securities.

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The following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position, at ~~September 30, 2019:~~March 31, 2020:

Less than 12 months 12 months or more Total
($ in Thousands)
Number
of
Securities

Unrealized
(Losses)

Fair
Value

Number
of
Securities

Unrealized
(Losses)

Fair
Value

Unrealized
(Losses)

Fair
Value
Investment securities available for sale
Obligations of state and political subdivisions (municipal securities) 1
$ —
$ 348
—
$ —
$ —
$ —
$ 348
Residential mortgage-related securities
FNMA / FHLMC 6
(38 ) 21,554
10
(289 ) 65,798
(326 ) 87,352
GNMA 4
(440 ) 67,563
3
(881 ) 86,930
(1,322 ) 154,493
GNMA commercial mortgage-related securities 15
(420 ) 179,281
44
(9,576 ) 653,148
(9,996 ) 832,429
FFELP asset backed securities 18
(2,853 ) 241,852
2
(270 ) 13,213
(3,123 ) 255,065
Other debt securities 3
(7 ) 2,993
—
—
—
(7 ) 2,993
Total 47
$ (3,758 ) $ 513,592
59
$ (11,016 ) $ 819,089
$ (14,774 ) $ 1,332,681
Investment securities held to maturity
Obligations of state and political subdivisions (municipal securities) 25
$ (705 ) $ 34,087
10
$ (28 ) $ 3,846
$ (733 ) $ 37,934
Residential mortgage-related securities
FNMA / FHLMC 3
(8 ) 3,674
1
(9 ) 840
(17 ) 4,514
GNMA 1
(25 ) 6,490
8
(69 ) 6,938
(94 ) 13,429
GNMA commercial mortgage-related securities 2
(56 ) 29,467
21
(4,903 ) 390,602
(4,959 ) 420,069
Total 31
$ (794 ) $ 73,718
40
$ (5,009 ) $ 402,227
$ (5,803 ) $ 475,945


	Less than 12 months								12 months or more						Total
($ in Thousands)	Number of Securities	Unrealized (Losses)		Fair Value		Number of Securities	Unrealized (Losses)		Fair Value		Unrealized (Losses)		Fair Value
Investment securities available for sale

U.S. government SBA agency securities	7	$	(5)	$	4,958	—	$	—	$	—	$	(5)	$	4,958
Obligations of state and political subdivisions (municipal securities)	5	(1)		1,313		—	—		—		(1)		1,313




GNMA commercial mortgage-related securities	22	(1,111)		259,273		8	(2,944)		138,611		(4,055)		397,883
FFELP asset backed securities	16	(10,971)		222,197		10	(8,262)		119,228		(19,234)		341,424
Other debt securities	2	—		2,000		—	—		—		—		2,000

Total	52	$	(12,089)	$	489,740	18	$	(11,206)	$	257,838	$	(23,295)	$	747,578
Investment securities held to maturity
Obligations of state and political subdivisions (municipal securities)	22	$	(470)	$	28,779	3	$	(5)	$	542	$	(475)	$	29,321
Residential mortgage-related securities
FNMA / FHLMC	1	—		—		—	—		—		—		—

GNMA commercial mortgage-related securities	8	(332)		126,170		7	(1,607)		126,624		(1,939)		252,794
Total	31	$	(802)	$	154,950	10	$	(1,612)	$	127,166	$	(2,414)	$	282,116

For comparative purposes, the following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, ~~2018:~~2019:

Less than 12 months 12 months or more Total
($ in Thousands) Number
of
Securities Unrealized
(Losses) Fair
Value Number
of
Securities Unrealized
(Losses) Fair
Value Unrealized
(Losses) Fair
Value
Investment securities available for sale
U.S. Treasury securities —
$ —
$ —
1
$ (1 ) $ 999
$ (1 ) $ 999
Residential mortgage-related securities
FNMA / FHLMC 15
(31 ) 17,993
17
(3,479 ) 189,405
(3,510 ) 207,398
GNMA 12
(4,529 ) 452,183
79
(37,355 ) 1,598,159
(41,885 ) 2,050,342
Private-label 1
(4 ) 1,003
—
—
—
(4 ) 1,003
GNMA commercial mortgage-related securities —
—
—
93
(52,512 ) 1,220,854
(52,512 ) 1,220,854
FFELP asset backed securities 13
(698 ) 142,432
—
—
—
(698 ) 142,432
Total 41
$ (5,262 ) $ 613,612
190
$ (93,347 ) $ 3,009,417
$ (98,610 ) $ 3,623,028
Investment securities held to maturity
Obligations of state and political subdivisions (municipal securities) 272
$ (2,860 ) $ 313,212
752
$ (12,419 ) $ 509,374
$ (15,279 ) $ 822,586
Residential mortgage-related securities
FNMA / FHLMC 13
(780 ) 57,896
22
(1,015 ) 28,888
(1,795 ) 86,784
GNMA 13
(414 ) 19,822
66
(7,767 ) 320,387
(8,181 ) 340,209
GNMA commercial mortgage-related securities —
—
—
25
(22,579 ) 490,414
(22,579 ) 490,414
Total 298
$ (4,053 ) $ 390,929
865
$ (43,780 ) $ 1,349,063
$ (47,835 ) $ 1,739,992


	Less than 12 months								12 months or more						Total
($ in Thousands)	Number of Securities	Unrealized (Losses)		Fair Value		Number of Securities	Unrealized (Losses)		Fair Value		Unrealized (Losses)		Fair Value
Investment securities available for sale

Obligations of state and political subdivisions (municipal securities)	4	$	(18)	$	1,225	—	$	—	$	—	$	(18)	$	1,225
Residential mortgage-related securities
FNMA / FHLMC	—	—		—		4	(59)		34,807		(59)		34,807
GNMA	18	(924)		322,394		3	(766)		79,461		(1,689)		401,856

GNMA commercial mortgage-related securities	22	(810)		258,218		42	(11,222)		621,307		(12,032)		879,524
FFELP asset backed securities	19	(6,092)		250,780		2	(393)		12,913		(6,485)		263,693
Other debt securities	2	—		2,000		—	—		—		—		2,000

Total	65	$	(7,843)	$	834,616	51	$	(12,440)	$	748,487	$	(20,284)	$	1,583,104
Investment securities held to maturity
Obligations of state and political subdivisions (municipal securities)	52	$	(1,105)	$	77,562	6	$	(13)	$	2,378	$	(1,118)	$	79,940
Residential mortgage-related securities
FNMA / FHLMC	1	(6)		1,242		1	(9)		833		(15)		2,075
GNMA	12	(1,059)		187,261		8	(49)		6,587		(1,108)		193,849
GNMA commercial mortgage-related securities	2	(29)		26,202		21	(6,093)		357,733		(6,122)		383,935
Total	67	$	(2,199)	$	292,267	36	$	(6,164)	$	367,532	$	(8,363)	$	659,799

The Corporation reviews the available for sale investment securities portfolio on a quarterly basis to monitor its ~~exposure to other-than-temporary impairment.~~credit exposure. A determination as to whether a security’s decline in fair value is ~~other-than-temporary~~the result of credit risk takes into

consideration numerous factors and the relative significance of any single factor can vary by security. Some factors the Corporation may consider in the ~~other-than-temporary~~ impairment analysis ~~include~~includes the ~~length of time and~~ extent to which the security has been in an unrealized loss position, ~~changes~~the change in security ~~ratings,~~rating, financial condition and near-term prospects of the issuer, as well as the security and industry specific economic conditions.

Based on the Corporation’s evaluation, management does not believe any available for sale securities in an unrealized loss position at ~~September 30, 2019 represents an other-than-temporary impairment~~March 31, 2020 represent credit deterioration as these unrealized losses are primarily attributable to changes in interest rates and the current market ~~conditions, and not credit deterioration.~~conditions. The unrealized losses reported for municipal securities ~~relate~~at March 31, 2020 pertain to various state and local political subdivisions and school ~~districts.~~districts, and have declined due to the decrease in overall

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interest rates. The unrealized losses at ~~September 30, 2019~~March 31, 2020 for mortgage-related securities have also declined due to the decrease in overall interest rates. The U.S. Treasury 3 year and 5 year rates decreased by 90133 bp and 96132 bp, respectively, from December 31, ~~2018.~~2019. The Corporation does not intend to sell nor does it believe that it will be required to sell the securities in an unrealized loss position before recovery of their amortized cost basis.

FHLB and Federal Reserve Bank stocks: The Corporation is required to maintain Federal Reserve Bank stock and FHLB stock as a member of both the Federal Reserve System and the FHLB, and in amounts as required by these institutions. These equity securities are “restricted” in that they can only be sold back to the respective institutions or another member institution at par. Therefore, they are less liquid than other marketable equity securities and their fair value is equal to amortized cost. At ~~September 30, 2019~~March 31, 2020 and December 31, ~~2018,~~2019, the Corporation had FHLB stock of ~~$129~~$145 million and ~~$173~~$149 million, respectively. The Corporation had Federal Reserve Bank stock of $78 million at ~~September 30, 2019~~both March 31, 2020 and ~~$77 million at~~ December 31, ~~2018.~~2019.

Equity Securities

Equity securities with readily determinable fair values: The Corporation's portfolio of equity securities with readily determinable fair values is primarily comprised of CRA Qualified Investment mutual funds. At both ~~September 30, 2019~~March 31, 2020 and December 31, ~~2018,~~2019, the Corporation had equity securities with readily determinable fair values of $2 million.

Equity securities without readily determinable fair values: The Corporation's portfolio of equity securities without readily determinable fair values consists of 77,996 Visa Class B restricted shares, ~~that~~77,000 of which the Corporation received in 2008 as part of Visa's initial public ~~offering. During the second quarter of 2019,~~offering and carried at fair value after the Corporation donated 42,039 ~~shares of~~ Visa Class B restricted shares to the Corporation's Charitable Remainder Trust ~~and~~during the second quarter of 2019, with the subsequent sale of those shares ~~by the Trust resulted~~resulting in an observable market ~~price. As a result,~~price after the Corporation wrote up their remaining 77,000 Visa Class B restricted shares to fair value. Based on the existing transfer restriction and the uncertainty of the covered litigation, the Visa Class B restricted shares were previously carried at a zero cost basis. ~~Thus,~~During the first quarter of 2020, the Corporation also acquired 996 Visa Class B restricted shares from the acquisition of First Staunton, and those shares are carried at a zero cost basis due to the lack of an observable market price since the time of acquisition. The Corporation had equity securities without readily determinable fair values of $13 million at ~~September 30, 2019~~both March 31, 2020 and ~~$0 at~~ December 31, ~~2018.~~2019.

Note 7 Loans

The period end loan composition was as follows:

($ in Thousands) September 30, 2019 December 31, 2018
Commercial and industrial $ 7,495,623
$ 7,398,044
Commercial real estate — owner occupied 915,524
920,443
Commercial and business lending 8,411,147
8,318,487
Commercial real estate — investor 3,803,277
3,751,554
Real estate construction 1,356,508
1,335,031
Commercial real estate lending 5,159,784
5,086,585
Total commercial 13,570,932
13,405,072
Residential mortgage 7,954,801
8,277,712
Home equity 879,642
894,473
Other consumer 349,335
363,171
Total consumer 9,183,778
9,535,357
Total loans^(a)(b)
$ 22,754,710
$ 22,940,429


($ in Thousands)	March 31, 2020		December 31, 2019
Commercial and industrial	$	8,517,974	$	7,354,594
Commercial real estate — owner occupied	940,687		911,265
Commercial and business lending	9,458,661		8,265,858
Commercial real estate — investor	4,038,036		3,794,517
Real estate construction	1,544,858		1,420,900
Commercial real estate lending	5,582,894		5,215,417
Total commercial	15,041,555		13,481,275
Residential mortgage	8,132,417		8,136,980
Home equity	844,901		852,025
Other consumer	346,761		351,159
Total consumer	9,324,079		9,340,164
Total loans^(a)	$	24,365,633	$	22,821,440

(a) During the ~~third~~first quarter of ~~2019,~~2020, the Corporation ~~sold approximately $240~~transferred $200 millionof portfolio residential mortgages ~~as well as $33 million of nonaccrual and performing restructured~~to residential loans held for sale, which are not included in total loans.

~~(b) Includes $2 million and $5 million of purchased credit-impaired loans at September 30, 2019 and December 31, 2018, respectively.~~

Accrued interest receivable on loans totaled $66 million at March 31, 2020, included in interest receivable on the consolidated balance sheets. Interest accrued but not received for loans placed on nonaccrual is reversed against interest income. The amount of accrued interest reversed totaled approximately $327,000 for the period ended March 31, 2020.

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The following table presents commercial and consumer loans by credit quality indicator by vintage year at ~~September 30, 2019:~~March 31, 2020:


					Term Loans Amortized Cost Basis by Origination Year^(a)
($ in Thousands)	Rev Loans Converted to Term^(a)		Rev Loans Amortized Cost Basis		YTD 2020		2019		2018		2017		2016		Prior		Total
Commercial and industrial:
Risk rating:
Pass	$	777	$	2,027,795	$	665,843	$	1,943,817	$	1,770,838	$	846,057	$	392,996	$	598,104	$	8,245,450
Special Mention	—		26,674		5,570		17,726		5,255		1,260		7,287		151		63,922
Potential Problem^(b)	685		60,784		134		2,430		21,030		53,915		9,053		2,401		149,747
Nonaccrual^(c)	—		—		231		7,200		550		16,171		17,532		17,171		58,854
Commercial and industrial	$	1,462	$	2,115,253	$	671,779	$	1,971,173	$	1,797,672	$	917,402	$	426,869	$	617,827	$	8,517,974
Commercial real estate - owner occupied:
Risk rating:
Pass	$	—	$	45,423	$	33,107	$	220,821	$	141,652	$	133,631	$	160,435	$	150,188	$	885,257
Special Mention	—		86		—		16,438		15,143		139		662		5,321		37,789
Potential Problem	—		230		100		780		1,173		1,463		9,930		2,126		15,802
Nonaccrual	—		—		—		—		88		343		—		1,407		1,838
Commercial real estate - owner occupied	$	—	$	45,739	$	33,207	$	238,039	$	158,056	$	135,576	$	171,026	$	159,043	$	940,687
Commercial and business lending:
Risk rating:
Pass	$	777	$	2,073,218	$	698,951	$	2,164,638	$	1,912,490	$	979,688	$	553,431	$	748,292	$	9,130,708
Special Mention	—		26,760		5,570		34,163		20,398		1,399		7,949		5,472		101,711
Potential Problem^(b)	685		61,014		234		3,211		22,204		55,378		18,983		4,527		165,550
Nonaccrual^(c)	—		—		231		7,200		637		16,514		17,532		18,578		60,692
Commercial and business lending	$	1,462	$	2,160,992	$	704,986	$	2,209,212	$	1,955,729	$	1,052,978	$	597,895	$	776,869	$	9,458,661
Commercial real estate - investor:
Risk rating:
Pass	$	—	$	206,640	$	499,631	$	1,253,538	$	820,547	$	348,738	$	405,718	$	344,191	$	3,879,003
Special Mention	—		—		—		33,440		15,128		15,239		31,581		1,525		96,913
Potential Problem	—		1,157		20		30,714		3,329		283		12,792		12,734		61,030
Nonaccrual	—		446		570		—		—		—		—		75		1,091
Commercial real estate - investor	$	—	$	208,244	$	500,221	$	1,317,691	$	839,004	$	364,261	$	450,091	$	358,524	$	4,038,036
Real estate construction:
Risk rating:
Pass	$	—	$	80,118	$	121,768	$	708,726	$	438,100	$	146,967	$	3,331	$	25,389	$	1,524,400
Special Mention	—		—		—		—		18,203		—		—		16		18,219
Potential Problem	—		—		—		148		—		1,557		—		48		1,753
Nonaccrual	—		—		—		—		—		—		—		486		486
Real estate construction	$	—	$	80,118	$	121,768	$	708,875	$	456,303	$	148,523	$	3,331	$	25,939	$	1,544,858
Commercial real estate lending:
Risk rating:
Pass	$	—	$	286,759	$	621,399	$	1,962,264	$	1,258,647	$	495,705	$	409,049	$	369,580	$	5,403,403
Special Mention	—		—		—		33,440		33,331		15,239		31,581		1,540		115,132
Potential Problem	—		1,157		20		30,862		3,329		1,840		12,792		12,782		62,783
Nonaccrual	—		446		570		—		—		—		—		560		1,577
Commercial real estate lending	$	—	$	288,362	$	621,990	$	2,026,565	$	1,295,307	$	512,784	$	453,422	$	384,463	$	5,582,894
Total commercial:
Risk rating:
Pass	$	777	$	2,359,976	$	1,320,350	$	4,126,902	$	3,171,136	$	1,475,393	$	962,480	$	1,117,872	$	14,534,111
Special Mention	—		26,760		5,570		67,603		53,729		16,638		39,530		7,013		216,843
Potential Problem	685		62,171		255		34,073		25,532		57,217		31,775		17,309		228,333
Nonaccrual	—		446		801		7,200		637		16,514		17,532		19,138		62,269
Total commercial	$	1,462	$	2,449,354	$	1,326,976	$	4,235,777	$	3,251,035	$	1,565,762	$	1,051,317	$	1,161,333	$	15,041,555

Table of Contents

($ in Thousands) Pass Special Mention Potential Problem Nonaccrual Total
Commercial and industrial $ 7,293,226
$ 86,434
$ 59,427
$ 56,536
$ 7,495,623
Commercial real estate - owner occupied 866,287
26,546
22,624
68
915,524
Commercial and business lending 8,159,513
112,980
82,051
56,604
8,411,147
Commercial real estate - investor 3,634,780
114,343
49,353
4,800
3,803,277
Real estate construction 1,332,930
22,492
544
542
1,356,508
Commercial real estate lending 4,967,710
136,835
49,897
5,342
5,159,784
Total commercial 13,127,223
249,815
131,948
61,946
13,570,932
Residential mortgage 7,896,073
430
1,242
57,056
7,954,801
Home equity 868,854
961
—
9,828
879,642
Other consumer 348,498
728
—
109
349,335
Total consumer 9,113,424
2,119
1,242
66,993
9,183,778
Total loans^(a)
$ 22,240,647
$ 251,934
$ 133,189
$ 128,939
$ 22,754,710


					Term Loans Amortized Cost Basis by Origination Year^(a)
($ in Thousands)	Rev Loans Converted to Term^(a)		Rev Loans Amortized Cost Basis		YTD 2020		2019		2018		2017		2016		Prior		Total
Residential mortgage:
Risk rating:
Pass	$	—	$	92	$	352,107	$	1,815,240	$	874,080	$	1,474,788	$	1,321,163	$	2,226,104	$	8,063,574
Special Mention	—		—		—		—		37		22		36		572		667
Potential Problem	—		—		—		587		36		992		432		1,274		3,322
Nonaccrual	—		—		619		3,802		5,422		8,949		12,678		33,385		64,855
Residential mortgage	$	—	$	92	$	352,726	$	1,819,630	$	879,575	$	1,484,752	$	1,334,308	$	2,261,335	$	8,132,417
Home equity:
Risk rating:
Pass	$	6,286	$	738,938	$	223	$	1,626	$	1,869	$	2,374	$	2,748	$	83,567	$	831,344
Special Mention	102		1,262		65		39		91		50		97		338		1,942
Potential Problem	—		2,045		—		—		46		—		—		146		2,238
Nonaccrual	221		916		128		224		284		383		180		7,263		9,378
Home equity	$	6,609	$	743,161	$	417	$	1,888	$	2,290	$	2,807	$	3,025	$	91,314	$	844,901
Other consumer:
Risk rating:
Pass	$	62	$	184,495	$	2,874	$	16,037	$	6,843	$	3,213	$	2,369	$	130,073	$	345,904
Special Mention	4		559		—		1		—		—		78		4		642
Potential Problem	—		—		—		—		—		—		—		—		—
Nonaccrual	8		119		—		34		—		10		—		52		215
Other consumer	$	75	$	185,173	$	2,874	$	16,072	$	6,843	$	3,223	$	2,447	$	130,129	$	346,761
Total consumer:
Risk rating:
Pass	$	6,348	$	923,525	$	355,204	$	1,832,904	$	882,791	$	1,480,375	$	1,326,279	$	2,439,744	$	9,240,821
Special Mention	106		1,821		65		40		128		71		212		914		3,251
Potential Problem	—		2,045		—		587		83		992		432		1,420		5,559
Nonaccrual	229		1,036		748		4,060		5,706		9,342		12,857		40,700		74,448
Total consumer	$	6,683	$	928,426	$	356,017	$	1,837,590	$	888,708	$	1,490,781	$	1,339,780	$	2,482,777	$	9,324,079
Total loans:
Risk rating:
Pass	$	7,125	$	3,283,501	$	1,675,554	$	5,959,806	$	4,053,928	$	2,955,768	$	2,288,760	$	3,557,616	$	23,774,932
Special Mention	106		28,581		5,635		67,642		53,857		16,710		39,741		7,927		220,093
Potential Problem	685		64,216		255		34,660		25,615		58,210		32,207		18,729		233,892
Nonaccrual	229		1,482		1,549		11,260		6,343		25,856		30,390		59,838		136,717
Total loans	$	8,145	$	3,377,780	$	1,682,992	$	6,073,368	$	4,139,743	$	3,056,543	$	2,391,098	$	3,644,110	$	24,365,633

(a) ~~During the third quarter~~Revolving loans converted to term loans are also reported in their year of ~~2019, the Corporation sold approximately $240~~origination

(b) Includes $67 million of ~~portfolio mortgages. In addition, the Corporation sold $33~~oil and gas related loans

Table of ~~which $21 million were pass loans and $12 million were nonaccrual loans.~~Contents

The following table presents commercial and consumer loans by credit quality indicator at December 31, ~~2018~~2019:

($ in Thousands) Pass Special Mention Potential Problem Nonaccrual Total
Commercial and industrial $ 7,162,370
$ 78,075
$ 116,578
$ 41,021
$ 7,398,044
Commercial real estate - owner occupied 854,265
6,257
55,964
3,957
920,443
Commercial and business lending 8,016,635
84,332
172,542
44,978
8,318,487
Commercial real estate - investor 3,653,642
28,479
67,481
1,952
3,751,554
Real estate construction 1,321,447
8,771
3,834
979
1,335,031
Commercial real estate lending 4,975,089
37,249
71,315
2,931
5,086,585
Total commercial 12,991,724
121,582
243,856
47,909
13,405,072
Residential mortgage 8,203,729
434
5,975
67,574
8,277,712
Home equity 880,808
1,223
103
12,339
894,473
Other consumer 362,343
749
—
79
363,171
Total consumer 9,446,881
2,406
6,078
79,992
9,535,357
Total loans $ 22,438,605
$ 123,988
$ 249,935
$ 127,901
$ 22,940,429


($ in Thousands)	Pass		Special Mention		Potential Problem		Nonaccrual		Total
Commercial and industrial	$	7,118,448	$	79,525	$	110,308	$	46,312	$	7,354,594
Commercial real estate - owner occupied	866,193		25,115		19,889		67		911,265
Commercial and business lending	7,984,641		104,641		130,197		46,380		8,265,858
Commercial real estate - investor	3,620,785		139,873		29,449		4,409		3,794,517
Real estate construction	1,420,374		33		—		493		1,420,900
Commercial real estate lending	5,041,159		139,906		29,449		4,902		5,215,417
Total commercial	13,025,800		244,547		159,646		51,282		13,481,275
Residential mortgage	8,077,122		563		1,451		57,844		8,136,980
Home equity	841,757		1,164		—		9,104		852,025
Other consumer	350,260		748		—		152		351,159
Total consumer	9,269,139		2,475		1,451		67,099		9,340,164
Total loans	$	22,294,939	$	247,022	$	161,097	$	118,380	$	22,821,440

Factors that are important to managing overall credit quality are sound loan underwriting and administration, systematic monitoring of existing loans and commitments, effective loan review on an ongoing basis, early identification of potential problems, and appropriate allowance for loan losses, allowance for unfunded commitments, nonaccrual, and charge off policies.

For commercial loans, management has determined the pass credit quality indicator to include credits exhibiting acceptable financial statements, cash flow, and leverage. If any risk exists, it is mitigated by the loan structure, collateral, monitoring, or control. For consumer loans, performing loans include credits performing in accordance with the original contractual terms. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Special mention credits have potential weaknesses that deserve management’s attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the credit. Potential problem loans are considered inadequately protected by the current net worth and paying capacity of the obligor or the collateral pledged. These loans generally have a well-defined weakness, or weaknesses, which may jeopardize liquidation of the debt, and are characterized by the distinct possibility the Corporation will sustain some loss if the deficiencies are not corrected. Lastly, management considers a loan to be impaired when it is probable the Corporation will be unable to collect all amounts due according to the original contractual terms of the note agreement, including both principal and interest. Management has determined commercial loan relationships in nonaccrual status and commercial and consumer loan relationships ~~in nonaccrual status or those~~ with their terms restructured in a ~~troubled debt restructuring~~TDR meet ~~this impaired loan definition.~~the criteria to be individually evaluated. Commercial loans classified as special mention, potential problem, and nonaccrual are reviewed at a minimum on a quarterly basis, while pass and performing rated credits are generally reviewed on an annual basis or more frequently if the loan renewal is less than one year or if otherwise warranted.

The following table presents loans by past due status at ~~September 30, 2019:~~March 31, 2020:

Accruing
($ in Thousands) Current
30-59 Days
Past Due

60-89 Days
Past Due

90 Days or
More
Past Due

Nonaccrual^(a)
Total
Commercial and industrial $ 7,438,395
$ 220
$ 206
$ 266
$ 56,536
$ 7,495,623
Commercial real estate - owner occupied 912,810
2,646
—
—
68
915,524
Commercial and business lending 8,351,205
2,867
206
266
56,604
8,411,147
Commercial real estate - investor 3,797,840
—
636
—
4,800
3,803,277
Real estate construction 1,355,371
571
24
—
542
1,356,508
Commercial real estate lending 5,153,211
571
661
—
5,342
5,159,784
Total commercial 13,504,416
3,438
866
266
61,946
13,570,932
Residential mortgage 7,889,681
7,866
197
—
57,056
7,954,801
Home equity 865,017
3,837
961
—
9,828
879,642
Other consumer 345,303
1,321
881
1,720
109
349,335
Total consumer 9,100,001
13,025
2,038
1,720
66,993
9,183,778
Total loans^(b)
$ 22,604,417
$ 16,462
$ 2,905
$ 1,986
$ 128,939
$ 22,754,710


	Accruing
($ in Thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual^(a)(b)		Total
Commercial and industrial	$	8,457,708	$	508	$	468	$	436	$	58,854	$	8,517,974
Commercial real estate - owner occupied	938,798		51		—		—		1,838		940,687
Commercial and business lending	9,396,506		558		468		436		60,692		9,458,661
Commercial real estate - investor	4,022,482		14,462		—		—		1,091		4,038,036
Real estate construction	1,544,194		179		—		—		486		1,544,858
Commercial real estate lending	5,566,676		14,641		—		—		1,577		5,582,894
Total commercial	14,963,182		15,200		468		436		62,269		15,041,555
Residential mortgage	8,057,461		9,492		610		—		64,855		8,132,417
Home equity	828,523		6,012		988		—		9,378		844,901
Other consumer	342,950		1,028		749		1,819		215		346,761
Total consumer	9,228,933		16,531		2,348		1,819		74,448		9,324,079
Total loans	$	24,192,115	$	31,731	$	2,816	$	2,255	$	136,717	$	24,365,633

(a)Of the total nonaccrual loans, ~~$47~~$75 million, or ~~36%~~55%, were current with respect to payment at ~~September 30, 2019.~~March 31, 2020.

(b)~~During~~ NaN interest income was recognized on nonaccrual loans during the ~~third quarter of 2019, the Corporation sold approximately $240~~three months ended March 31, 2020. In addition, there were $44 million of ~~portfolio mortgages. In addition, the Corporation sold $33 million of residential mortgages and home equity loans, of which $21 million were accruing current loans, $12 million were~~ nonaccrual loans ~~and approximately $200,000 were 30-89 days past due accruing loans.~~for which there was no related ACLL for the three months ended March 31, 2020.

Table of Contents

The following table presents loans by past due status at December 31, ~~2018:~~2019:


	Accruing
($ in Thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual^(a)		Total
Commercial and industrial	$	7,307,118	$	576	$	245	$	342	$	46,312	$	7,354,594
Commercial real estate - owner occupied	909,828		1,369		—		—		67		911,265
Commercial and business lending	8,216,947		1,945		245		342		46,380		8,265,858
Commercial real estate - investor	3,788,296		1,812		—		—		4,409		3,794,517
Real estate construction	1,420,310		64		33		—		493		1,420,900
Commercial real estate lending	5,208,606		1,876		33		—		4,902		5,215,417
Total commercial	13,425,552		3,821		278		342		51,282		13,481,275
Residential mortgage	8,069,863		8,749		525		—		57,844		8,136,980
Home equity	837,274		4,483		1,164		—		9,104		852,025
Other consumer	347,007		1,135		949		1,917		152		351,159
Total consumer	9,254,144		14,366		2,638		1,917		67,099		9,340,164
Total loans	$	22,679,696	$	18,188	$	2,916	$	2,259	$	118,380	$	22,821,440

Accruing
($ in Thousands) Current
30-59 Days
Past Due

60-89 Days
Past Due

90 Days or
More
Past Due

Nonaccrual^(a)
Total
Commercial and industrial $ 7,356,187
$ 187
$ 338
$ 311
$ 41,021
$ 7,398,044
Commercial real estate - owner occupied 913,787
2,580
119
—
3,957
920,443
Commercial and business lending 8,269,974
2,767
457
311
44,978
8,318,487
Commercial real estate - investor 3,745,835
2,954
813
—
1,952
3,751,554
Real estate construction 1,333,722
330
—
—
979
1,335,031
Commercial real estate lending 5,079,557
3,284
813
—
2,931
5,086,585
Total commercial 13,349,531
6,051
1,270
311
47,909
13,405,072
Residential mortgage 8,200,432
9,272
434
—
67,574
8,277,712
Home equity 876,085
4,826
1,223
—
12,339
894,473
Other consumer 358,970
1,401
868
1,853
79
363,171
Total consumer 9,435,487
15,499
2,525
1,853
79,992
9,535,357
Total loans $ 22,785,019
$ 21,550
$ 3,795
$ 2,165
$ 127,901
$ 22,940,429

(a) Of the total nonaccrual loans, ~~$74~~$48 million, or ~~58%~~41%, were current with respect to payment at December 31, ~~2018.~~2019.

Table of Contents

The following table presents impaired loans individually evaluated under ASC Topic 310, excluding $2 million of purchased credit-impaired loans, at ~~September 30, 2019:~~December 31, 2019:


($ in Thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized		($ in Thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Loans with a related allowance											Loans with a related allowance
Commercial and industrial	$	48,597	$	59,132	$	17,791	$	45,439	$	1,003	Commercial and industrial	$	47,249	$	63,346	$	12,010	$	45,290	$	1,832
Commercial real estate — owner occupied	1,912		1,919		19		1,988		78		Commercial real estate — owner occupied	1,676		1,682		19		1,774		88
Commercial and business lending	50,510		61,051		17,811		47,427		1,081		Commercial and business lending	48,924		65,028		12,029		47,064		1,919
Commercial real estate — investor	1,400		2,575		101		780		21		Commercial real estate — investor	928		2,104		15		950		15
Real estate construction	409		490		56		419		21		Real estate construction	477		559		67		494		30
Commercial real estate lending	1,809		3,066		157		1,199		42		Commercial real estate lending	1,405		2,663		82		1,445		45
Total commercial	52,319		64,116		17,968		48,626		1,123		Total commercial	50,329		67,691		12,111		48,509		1,965
Residential mortgage	24,621		25,783		3,824		27,173		623		Residential mortgage	21,450		22,625		2,740		23,721		856
Home equity	3,604		4,011		1,313		6,796		136		Home equity	3,076		3,468		1,190		3,756		191
Other consumer	1,244		1,246		187		1,246		1		Other consumer	1,247		1,249		125		1,250		1
Total consumer	29,468		31,041		5,323		35,214		760		Total consumer	25,773		27,342		4,055		28,726		1,047
Total loans with a related allowance	$	81,787	$	95,157	$	23,291	$	83,840	$	1,883	Total loans with a related allowance	$	76,102	$	95,033	$	16,165	$	77,235	$	3,012
Loans with no related allowance											Loans with no related allowance
Commercial and industrial	$	21,971	$	59,697	$	—	$	14,448	$	—	Commercial and industrial	$	14,787	$	33,438	$	—	$	20,502	$	63
Commercial real estate — owner occupied	—		—		—		—		—		Commercial real estate — owner occupied	—		—		—		—		—
Commercial and business lending	21,971		59,697		—		14,448		—		Commercial and business lending	14,787		33,438		—		20,502		63
Commercial real estate — investor	3,705		3,705		—		637		159		Commercial real estate — investor	3,705		3,705		—		3,980		159
Real estate construction	—		—		—		—		—		Real estate construction	—		—		—		—		—
Commercial real estate lending	3,705		3,705		—		637		159		Commercial real estate lending	3,705		3,705		—		3,980		159
Total commercial	25,675		63,402		—		15,086		159		Total commercial	18,491		37,142		—		24,482		222
Residential mortgage	11,418		11,732		—		8,732		279		Residential mortgage	14,104		14,461		—		10,962		373
Home equity	1,044		1,063		—		1,017		18		Home equity	1,346		1,383		—		1,017		21
Other consumer	—		—		—		—		—		Other consumer	—		—		—		—		—
Total consumer	12,462		12,795		—		9,749		297		Total consumer	15,450		15,845		—		11,979		394
Total loans with no related allowance	$	38,138	$	76,197	$	—	$	24,835	$	456	Total loans with no related allowance	$	33,941	$	52,987	$	—	$	36,462	$	616
Total											Total
Commercial and industrial	$	70,568	$	118,829	$	17,791	$	59,887	$	1,003	Commercial and industrial	$	62,035	$	96,784	$	12,010	$	65,792	$	1,895
Commercial real estate — owner occupied	1,912		1,919		19		1,988		78		Commercial real estate — owner occupied	1,676		1,682		19		1,774		88
Commercial and business lending	72,480		120,748		17,811		61,875		1,081		Commercial and business lending	63,711		98,466		12,029		67,566		1,982
Commercial real estate — investor	5,104		6,280		101		1,417		180		Commercial real estate — investor	4,633		5,808		15		4,931		174
Real estate construction	409		490		56		419		21		Real estate construction	477		559		67		494		30
Commercial real estate lending	5,514		6,770		157		1,836		201		Commercial real estate lending	5,110		6,367		82		5,425		204
Total commercial	77,994		127,518		17,968		63,712		1,282		Total commercial	68,820		104,833		12,111		72,991		2,186
Residential mortgage	36,039		37,515		3,824		35,905		902		Residential mortgage	35,554		37,087		2,740		34,683		1,229
Home equity	4,648		5,075		1,313		7,812		154		Home equity	4,422		4,851		1,190		4,773		211
Other consumer	1,244		1,246		187		1,246		1		Other consumer	1,247		1,249		125		1,250		1
Total consumer	41,931		43,836		5,323		44,964		1,056		Total consumer	41,223		43,187		4,055		40,706		1,441
Total loans^(a)	$	119,925	$	171,354	$	23,291	$	108,675	$	2,338	Total loans^(a)	$	110,043	$	148,020	$	16,165	$	113,697	$	3,628

(a) The net recorded investment (defined as recorded investment, net of the related allowance) of the impaired loans represented ~~56% of the unpaid principal balance at September 30, 2019.~~

~~The following table presents impaired loans individually evaluated under ASC Topic 310, excluding $5 million of purchased credit-impaired loans, at December 31, 2018~~:

~~(a) The net recorded investment (defined as recorded investment, net of the related allowance) of the impaired loans represented 72%~~63% of the unpaid principal balance at December 31, ~~2018.~~2019.

Troubled Debt Restructurings (“Restructured Loans”)

Loans are considered restructured loans if concessions have been granted to borrowers that are experiencing financial difficulty.

The following table presents nonaccrual and performing restructured loans by loan portfolio:

Total restructured loans^(b)

(a) Nonaccrual restructured loans have been included within nonaccrual loans.

(b) ~~During the third quarter of 2019, the Corporation sold $21 million of performing~~Does not include any restructured loans ~~of which $18 million were residential mortgages and $3 million were home equity loans. In addition, the Corporation sold $7 million of nonaccrual restructured residential mortgage loans.~~related to COVID-19 in accordance with regulatory guidance.

The Corporation had a recorded investment of $7$5 million in loans modified in ~~troubled debt restructurings~~a TDR during the ~~nine~~three months ended ~~September 30, 2019,~~March 31, 2020, of which $2$1 million were in accrual status and $5$4 million were in nonaccrual pending a sustained period of repayment. Short-term loan modifications made in good faith to help ease the adverse effects of COVID-19 are not categorized as TDRs in accordance with regulatory guidance. The following table provides the number of loans modified in a ~~troubled debt restructuring~~TDR by loan portfolio, the recorded investment and unpaid principal balance for the ~~nine~~three months ended ~~September 30, 2019~~March 31, 2020 and ~~2018:~~2019:

Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
($ in Thousands)
Number
of
Loans

Recorded
Investment^(a)

Unpaid
Principal
Balance^(b)

Number
of
Loans

Recorded
Investment^(a)

Unpaid
Principal
Balance^(b)
Commercial and industrial 1
$ 185
$ 185
6
$ 1,954
$ 1,995
Commercial real estate — investor —
—
—
1
958
1,022
Residential mortgage 47
6,785
6,863
29
5,655
5,733
Home equity 18
520
520
32
1,552
1,582
Other consumer 1
9
9
3
19
21
Total loans modified 67
$ 7,500
$ 7,577
71
$ 10,138
$ 10,353


	Three Months Ended March 31, 2020								Three Months Ended March 31, 2019
($ in Thousands)	Number of Loans	Recorded Investment^(a)		Unpaid Principal Balance^(b)		Number of Loans	Recorded Investment^(a)		Unpaid Principal Balance^(b)
Commercial and industrial	1	$	48	$	48	—	$	—	$	—
Commercial real estate — owner occupied	1	290		321		1	78		78
Commercial real estate — investor	1	570		1,740		—	—		—
Real estate construction	1	122		122		—	—		—
Residential mortgage	18	3,592		3,668		25	4,357		4,374
Home equity	8	277		277		13	293		312
Other consumer	—	—		—		1	11		11
Total loans modified	30	$	4,899	$	6,175	40	$	4,739	$	4,776

(a) Represents post-modification outstanding recorded investment.

(b) Represents pre-modification outstanding recorded investment.

Restructured loan modifications may include payment schedule modifications, interest rate concessions, maturity date extensions, modification of note structure (A/B Note), non-reaffirmed Chapter 7 bankruptcies, principal reduction, or some combination of these concessions. During the ~~nine~~three months ended ~~September 30, 2019,~~March 31, 2020, restructured loan modifications of commercial and industrial, and commercial real estate primarily included maturity date extensions and payment schedule modifications. Restructured loan modifications of residential mortgage and home equity ~~and other consumer~~ loans primarily included maturity date extensions, interest rate concessions, non-reaffirmed Chapter 7 bankruptcies, or a combination of these concessions for the ~~nine~~three months ended ~~September 30, 2019.~~March 31, 2020.

The following table provides the number of loans modified in a ~~troubled debt restructuring~~TDR during the previous twelve months which subsequently defaulted during the ~~nine~~three months ended ~~September 30,~~March 31, 2020 and 2019 ~~and 2018~~ and the recorded investment in these restructured loans as of ~~September 30, 2019~~March 31, 2020 and ~~2018:~~2019:


	Three Months Ended March 31, 2020				Three Months Ended March 31, 2019
($ in Thousands)	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment




Residential mortgage	3	$	388	5	$	613
Home equity	2	88		7	177

Total loans modified	5	$	476	12	$	790

Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018
($ in Thousands)
Number of
Loans

Recorded
Investment

Number of
Loans

Recorded
Investment
Commercial and industrial —
$ —
3
$ —
Commercial real estate — investor 1
461
—
—
Residential mortgage 27
4,528
12
2,579
Home equity 19
538
28
1,599
Total loans modified 47
$ 5,526
43
$ 4,178

All loans modified in a ~~troubled debt restructuring~~TDR are evaluated for impairment. The nature and extent of the impairment of restructured loans, including those which have experienced a subsequent payment default, are considered in the determination of an appropriate level of the allowance for credit losses on loans.

The Corporation analyzes loans for classification as a probable TDR. This analysis includes identifying customers that are showing possible liquidity issues in the near term without reasonable access to alternative sources of capital. At adoption of ASU 2016-13 on January 1, 2020, the Corporation had $114 million in loans meeting this classification compared to $138 million at March 31, 2020. Of the loans classified as probable TDRs at March 31, 2020, $112 million are within the oil and gas portfolio, while one loan ~~losses.~~with a balance of $27 million, is in general commercial and business lending.

Allowance for Credit Losses on Loans

The ~~allowance for credit losses~~ACLL is comprised of the allowance for loan losses and the allowance for unfunded commitments. The level of the ~~allowance for loan losses~~ACLL represents management’s estimate of an amount appropriate to provide for ~~probable~~expected lifetime credit losses in the loan portfolio at the balance sheet date. A main factor in the determination of the ACLL is the economic forecast. The Corporation utilized the Moody's baseline forecast, updated at the end of March 2020, in the allowance model. The forecast is applied over a 1 year reasonable and supportable period with immediate reversion to historical long run losses. The Corporation changed the reversion methodology applied from straight-line over 1 year to immediate reversion due to the uncertainty within the economic forecasts due to COVID-19. The allowance for unfunded commitments is maintained at a level believed by management to be sufficient to absorb ~~estimated probable~~expected lifetime losses related to unfunded credit facilities (including unfunded loan commitments and letters of credit) ~~and is included in accrued expenses and other liabilities on the consolidated balance sheets.~~. See Note 12 for additional information on the change in the allowance for unfunded commitments.

The following table presents a summary of the changes in the ~~allowance for loan losses~~ACLL by portfolio segment for the ~~nine~~three months ended ~~September 30, 2019:~~March 31, 2020:


($ in Thousands)	Dec. 31, 2019		Cumulative effect of ASU 2016-13 adoption (CECL)		Jan. 1, 2020		Charge offs		Recoveries		Net Charge offs		Allowance for PCD loans for bank acquisition		Provision recorded at acquisition		Provision for loan losses		March 31, 2020		ACLL / Loans
Allowance for loan losses
Commercial and industrial	$	91,133	$	52,919	$	144,052	$	(16,336)	$	1,288	$	(15,049)	$	293	$	408	$	44,284	$	173,988
Commercial real estate — owner occupied	10,284		(1,851)		8,433		—		—		—		890		255		734		10,313
Commercial and business lending	101,417		51,068		152,485		(16,336)		1,288		(15,048)		1,183		663		45,018		184,301
Commercial real estate — investor	40,514		2,041		42,555		—		—		—		753		472		(1,664)		42,115
Real estate construction	24,915		7,467		32,382		(7)		19		11		435		492		(2,573)		30,746
Commercial real estate lending	65,428		9,508		74,937		(7)		19		11		1,188		964		(4,237)		72,861
Total commercial	166,846		60,576		227,422		(16,343)		1,307		(15,037)		2,371		1,627		40,781		257,162
Residential mortgage	16,960		33,215		50,175		(1,003)		91		(912)		651		403		(6,370)		43,947
Home equity	10,926		11,649		22,575		(526)		598		71		422		374		(1,135)		22,308
Other consumer	6,639		7,016		13,655		(1,434)		272		(1,162)		61		140		1,681		14,376
Total consumer	34,525		51,880		86,405		(2,963)		961		(2,003)		1,134		917		(5,824)		80,631
Total loans	$	201,371	$	112,457	$	313,828	$	(19,308)	$	2,268	$	(17,040)	$	3,504	$	2,543	$	34,957	$	337,793
Allowance for unfunded commitments
Commercial and industrial	$	12,276	$	(3,998)	$	8,278	$	—	$	—	$	—	$	—	$	61	$	6,461	$	14,800
Commercial real estate — owner occupied	127		—		127		—		—		—		—		4		109		240
Commercial and business lending	12,403		(3,998)		8,405		—		—		—		—		65		6,570		15,040
Commercial real estate — investor	530		246		776		—		—		—		—		2		(347)		431
Real estate construction	7,532		18,347		25,879		—		—		—		—		45		9,018		34,942
Commercial real estate lending	8,062		18,593		26,655		—		—		—		—		47		8,671		35,373
Total commercial	20,465		14,595		35,060		—		—		—		—		112		15,241		50,413

Home equity	1,038		2,591		3,629		—		—		—		—		66		241		3,936
Other consumer	405		1,504		1,909		—		—		—		—		—		17		1,926
Total consumer	1,443		4,095		5,538		—		—		—		—		66		258		5,862
Total loans	$	21,907	$	18,690	$	40,597	$	—	$	—	$	—	$	—	$	179	$	15,500	$	56,276
Allowance for credit losses on loans
Commercial and industrial	$	103,409	$	48,921	$	152,330	$	(16,336)	$	1,288	$	(15,049)	$	293	$	469	$	50,745	$	188,788	2.22	%
Commercial real estate — owner occupied	10,411		(1,851)		8,560		—		—		—		890		259		843		10,553		1.12	%
Commercial and business lending	113,820		47,070		160,890		(16,336)		1,288		(15,048)		1,183		728		51,588		199,342		2.11	%
Commercial real estate — investor	41,044		2,287		43,331		—		—		—		753		474		(2,011)		42,546		1.05	%
Real estate construction	32,447		25,814		58,261		(7)		19		11		435		537		6,445		65,688		4.25	%
Commercial real estate lending	73,490		28,101		101,591		(7)		19		11		1,188		1,011		4,434		108,235		1.94	%
Total commercial	187,311		75,171		262,482		(16,343)		1,307		(15,037)		2,371		1,739		56,022		307,577		2.04	%
Residential mortgage	16,960		33,215		50,175		(1,003)		91		(912)		651		403		(6,370)		43,947		0.54	%
Home equity	11,964		14,240		26,204		(526)		598		71		422		440		(894)		26,244		3.11	%
Other consumer	7,044		8,520		15,564		(1,434)		272		(1,162)		61		140		1,698		16,302		4.70	%
Total consumer	35,968		55,975		91,943		(2,963)		961		(2,003)		1,134		983		(5,566)		86,493		0.93	%
Total loans	$	223,278	$	131,147	$	354,425	$	(19,308)	$	2,268	$	(17,040)	$	3,504	$	2,722	$	50,457	$	394,069	1.62	%

($ in Thousands) Commercial and
industrial Commercial real estate - owner occupied Commercial real estate -
investor Real estate
construction Residential
mortgage Home
equity Other
consumer Total
December 31, 2018 $ 108,835
$ 9,255
$ 40,844
$ 28,240
$ 25,595
$ 19,266
$ 5,988
$ 238,023
Charge offs (49,845 ) (222 ) —
(60 ) (1,754 ) (1,605 ) (4,074 ) (57,560 )
Recoveries 10,322
2,795
31
230
539
1,878
667
16,462
Net Charge offs (39,523 ) 2,573
31
170
(1,215 ) 273
(3,407 ) (41,098 )
Provision for loan losses 36,419
(3,229 ) (971 ) (4,960 ) (5,757 ) (7,690 ) 3,688
17,500
September 30, 2019 $ 105,730
$ 8,599
$ 39,904
$ 23,451
$ 18,623
$ 11,849
$ 6,269
$ 214,425
Allowance for loan losses
Individually evaluated for impairment $ 17,791
$ 19
$ 101
$ 56
$ 3,824
$ 1,313
$ 187
$ 23,291
Collectively evaluated for impairment 87,939
8,579
39,803
23,395
14,799
10,536
6,082
191,133
Total allowance for loan losses $ 105,730
$ 8,599
$ 39,904
$ 23,451
$ 18,623
$ 11,849
$ 6,269
$ 214,425
Loans
Individually evaluated for impairment $ 70,568
$ 1,912
$ 5,104
$ 409
$ 36,039
$ 4,648
$ 1,244
$ 119,925
Collectively evaluated for impairment 7,424,690
912,935
3,798,039
1,356,088
7,918,265
874,968
348,091
22,633,075
Acquired and accounted for under ASC 310-30^(a)
365
677
134
11
497
26
—
1,710
Total loans $ 7,495,623
$ 915,524
$ 3,803,277
$ 1,356,508
$ 7,954,801
$ 879,642
$ 349,335
$ 22,754,710

The following table presents details of the allowance for loan losses segregated by loan portfolio segment as of December 31, 2019, calculated in accordance with prior incurred loss methodology applicable under ASC Topic 310:


($ in Thousands)	December 31, 2018		Charge offs		Recoveries		Net Charge offs		Provision for loan losses		December 31, 2019
Allowance for loan losses
Commercial and industrial	$	108,835	$	(63,315)	$	11,875	$	(51,441)	$	33,738	$	91,133
Commercial real estate — owner occupied	9,255		(222)		2,795		2,573		(1,543)		10,284
Commercial and business lending	118,090		(63,537)		14,670		(48,868)		32,195		101,417
Commercial real estate — investor	40,844		—		31		31		(361)		40,514
Real estate construction	28,240		(60)		302		243		(3,568)		24,915
Commercial real estate lending	69,084		(60)		333		274		(3,929)		65,429
Total commercial	187,174		(63,597)		15,003		(48,594)		28,266		166,846
Residential mortgage	25,595		(3,322)		692		(2,630)		(6,005)		16,960
Home equity	19,266		(1,846)		2,599		753		(9,093)		10,926
Other consumer	5,988		(5,548)		868		(4,681)		5,332		6,639
Total consumer	50,849		(10,716)		4,159		(6,558)		(9,766)		34,525
Total loans	$	238,023	$	(74,313)	$	19,161	$	(55,152)	$	18,500	$	201,371

A summary of the individually and collectively evaluated loans by portfolio segment at December 31, 2019, was as follows:


	Allowance for loan losses										Loans
($ in Thousands)	Individually evaluated for impairment		Collectively evaluated for impairment		Total allowance for loan losses		Individually evaluated for impairment		Collectively evaluated for impairment		Acquired and accounted for under ASC 310-30^(a)		Total loans
Commercial and industrial	$	12,010	$	79,123	$	91,133	$	62,035	$	7,292,217	$	342	$	7,354,594
Commercial real estate — owner occupied	19		10,265		10,284		1,676		909,010		579		911,265
Commercial and business lending	12,029		89,388		101,417		63,711		8,201,227		921		8,265,858
Commercial real estate — investor	15		40,498		40,514		4,633		3,789,755		129		3,794,517
Real estate construction	67		24,848		24,915		477		1,420,416		7		1,420,900
Commercial real estate lending	82		65,346		65,429		5,110		5,210,171		136		5,215,417
Total commercial	12,111		154,734		166,846		68,821		13,411,398		1,057		13,481,275
Residential mortgage	2,740		14,220		16,960		35,554		8,100,958		469		8,136,980
Home equity	1,190		9,737		10,926		4,422		847,577		26		852,025
Other consumer	125		6,514		6,639		1,247		349,912		—		351,159
Total consumer	4,055		30,471		34,525		41,223		9,298,447		495		9,340,164
Total loans	$	16,165	$	185,205	$	201,371	$	110,043	$	22,709,845	$	1,552	$	22,821,440

~~For comparison purposes, a summary of the changes in the allowance for loan losses by portfolio segment for the year ended December 31, 2018, was as follows:~~

($ in Thousands) Commercial and
industrial Commercial real estate - owner occupied Commercial real estate -
investor Real estate
construction Residential
mortgage Home
equity Other
consumer Total
December 31, 2017 $ 123,068
$ 10,352
$ 41,059
$ 34,370
$ 29,607
$ 22,126
$ 5,298
$ 265,880
Charge offs (30,837 ) (1,363 ) (7,914 ) (298 ) (1,627 ) (3,236 ) (5,261 ) (50,536 )
Recoveries 13,714
639
668
446
1,271
2,628
812
20,179
Net Charge offs (17,123 ) (724 ) (7,246 ) 149
(355 ) (608 ) (4,448 ) (30,358 )
Provision for loan losses 2,890
(373 ) 7,031
(6,279 ) (3,657 ) (2,252 ) 5,138
2,500
December 31, 2018 $ 108,835
$ 9,255
$ 40,844
$ 28,240
$ 25,595
$ 19,266
$ 5,988
$ 238,023
Allowance for loan losses
Individually evaluated for impairment $ 5,721
$ 24
$ 28
$ 75
$ 6,023
$ 3,312
$ 121
$ 15,304
Collectively evaluated for impairment 103,114
9,231
40,816
28,165
19,572
15,954
5,867
222,719
Total allowance for loan losses $ 108,835
$ 9,255
$ 40,844
$ 28,240
$ 25,595
$ 19,266
$ 5,988
$ 238,023
Loans
Individually evaluated for impairment $ 63,153
$ 5,852
$ 2,384
$ 510
$ 50,486
$ 10,124
$ 1,181
$ 133,690
Collectively evaluated for impairment 7,331,898
913,708
3,748,883
1,334,500
8,226,642
884,266
361,990
22,801,887
Acquired and accounted for under ASC 310-30^(a)
2,994
883
287
21
584
83
—
4,853
Total loans $ 7,398,044
$ 920,443
$ 3,751,554
$ 1,335,031
$ 8,277,712
$ 894,473
$ 363,171
$ 22,940,429

~~(a) Loans acquired in business combinations and accounted for under ASC Subtopic 310-30 "Receivables — Loans and Debt Securities Acquired with Deteriorated Credit Quality."~~

The allowance related to the oil and gas portfolio was $21 million, or 3.7% of total oil and gas loans, and $12 million, or 1.6% of total oil and gas loans, at September 30, 2019 and December 31, 2018, respectively. The following table provides a summary of the changes in allowance for loan losses in the Corporation's oil and gas loan portfolio at September 30, 2019 and December 31, 2018:

($ in Millions) Nine Months Ended September 30, 2019 Year Ended December 31, 2018
Balance at beginning of period $ 12
$ 27
Charge offs (39 ) (24 )
Recoveries 5
6
Net Charge offs (34 ) (17 )
Provision for loan losses 44
2
Balance at end of period $ 21
$ 12
Allowance for loan losses
Individually evaluated for impairment $ 11
$ —
Collectively evaluated for impairment 10
12
Total allowance for loan losses $ 21
$ 12
Loans
Individually evaluated for impairment $ 36
$ 22
Collectively evaluated for impairment 545
725
Total loans $ 582
$ 747

The allowance for unfunded commitments is maintained at a level believed by management to be sufficient to absorb estimated probable losses related to unfunded credit facilities (including unfunded loan commitments and letters of credit) and is included in accrued expenses and other liabilities on the consolidated balance sheets. The following table presents a summary of the changes in the allowance for unfunded commitments:

($ in Thousands) Nine Months Ended September 30, 2019 Year Ended December 31, 2018
Allowance for Unfunded Commitments
Balance at beginning of period $ 24,336
$ 24,400
Provision for unfunded commitments (1,500 ) (2,500 )
Amount recorded at acquisition 70
2,436
Balance at end of period $ 22,907
$ 24,336

Loans acquired in a business combination after January 1, 2020 are recorded in accordance with ASC Topic 326. See Note 2 Acquisitions for more information on loans acquired in a business combination. After January 1, 2020, acquired loans were segregated into two types:

Loans acquired in a business combination prior to January 1, 2020 were recorded at estimated fair value on their purchase date without a carryover of the related allowance for loan losses. ~~Acquired~~Prior to January 1, 2020, acquired loans ~~are~~were segregated into two types:

~~For performing loans, the difference between the estimated fair value of the loans and the principal outstanding is accreted over the remaining life of the loans.~~

In accordance with ASC 310-30, purchased credit-impaired loans are pooled by loan type and the difference between contractually required payments at acquisition and the cash flows expected to be collected is referred to as the non-accretable difference. Further, any excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable yield and is recognized into interest income over the remaining life of the loan pools when there is a reasonable expectation about the amount and timing of such cash flows. If a reasonable expectation on the amount or timing of such cash flows cannot be determined, accretion of the fair value discount for nonperforming loans will be recognized using the cost recovery method of accounting.

~~Changes in the accretable yield for loans acquired and accounted for under ASC Topic 310-30 were as follows for the nine months ended September 30, 2019 and for the year ended December 31, 2018:~~

($ in Thousands) Nine Months Ended September 30, 2019 Year Ended December 31, 2018
Changes in Accretable Yield
Balance at beginning of period $ 1,482
$ —
Purchases —
4,853
Accretion (912 ) (4,954 )
Net reclassification from non-accretable yield 23
1,605
Other^(a)
—
(22 )
Balance at end of period $ 595
$ 1,482

~~(a) Primarily includes charge-offs which are accounted for under ASC Subtopic 310-30 "Receivables — Loans and Debt Securities Acquired with Deteriorated Credit Quality."~~

For loans acquired, the fair value of purchased credit-impaired loans, on the acquisition date, was determined based on assigned risk ratings, expected cash flows and the fair value of loan collateral. The fair value of loans that were non-impaired was determined based on estimates of losses on defaults and other market factors. The Corporation's Huntington branch acquisition included 0 purchased credit-impaired loans.

At September 30, 2019, the Corporation had a total of approximately $15 million in net unaccreted purchase discount, of which approximately $14 million was related to performing loans and approximately $1 million was related to the Corporation's purchased credit-impaired loans. At December 31, 2018, the Corporation had a total of approximately $20 million in net unaccreted purchase discount, of which approximately $18 million was related to performing loans and approximately $2 million was related to the Corporation's purchased credit-impaired loans.

Note 8 Goodwill and Other Intangible Assets

Goodwill is not amortized but is instead subject to impairment tests on at least an annual basis, and more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.

The Corporation conducted its most recent annual impairment testing in May 2019, utilizing a qualitative assessment. Factors that management considered in this assessment included macroeconomic conditions, industry and market considerations, overall financial performance of the Corporation and each reporting unit (both current and projected), changes in management strategy, and changes in the composition or carrying amount of net assets. In addition, management considered the changes in both the Corporation’s common stock price and in the overall bank common stock index (based on the S&P 400 Regional Bank Sub-Industry Index), as well as the Corporation’s earnings per common share trend over the past year. Based on these assessments, management concluded that it is more likely than not that the estimated fair value exceeded the carrying value (including goodwill) for each reporting unit. Therefore, a step one quantitative analysis was not required. There have been no events since the May 2019 impairment testing that have changed the Corporation's impairment assessment conclusion. A qualitative analysis was performed during the first quarter of 2020 after COVID-19 was declared a national emergency, to determine if a triggering event had occurred. The Corporation determined a triggering event had not occurred, therefore, a step one quantitative analysis was not required during the first quarter of 2020. There were 0 impairment charges recorded in ~~2018~~2019 or the first ~~nine~~three months of ~~2019.~~2020.

At both ~~September 30, 2019~~March 31, 2020 and December 31, ~~2018,~~2019, the Corporation had goodwill of $1.2 ~~billion.~~billion, of which $82 million was related to our insurance operations. There was an increase of $7$15 million during the ~~second~~first quarter of ~~2019~~2020 related to the ~~Huntington branch acquisition, and an adjustment of approximately $210,000 in the third quarter of 2019 driven by an update that decreased the fair value of furniture acquired.~~First Staunton acquisition.

Other Intangible Assets

The Corporation has other intangible assets that are amortized, consisting of ~~CDI,~~CDIs, other intangibles (primarily related to customer relationships acquired in connection with the Corporation’s insurance agency acquisitions), and ~~MSR.~~MSRs. At March 31, 2020, the Corporation had $19 million of other intangibles, compared to $20 million at December 31, 2019, of which $18 million was related to our insurance operations. For ~~CDI~~CDIs and other intangibles, changes in the gross carrying amount, accumulated amortization, and net book value were as follows:

($ in Thousands) Nine Months Ended September 30, 2019 Year Ended December 31, 2018
Core deposit intangibles
Gross carrying amount $ 80,730
$ 58,100
Accumulated amortization (10,438 ) (5,326 )
Net book value $ 70,292
$ 52,774
Additions during the period $ 22,630
$ 58,100
Amortization during the year $ 5,112
$ 5,326
Other intangibles
Gross carrying amount $ 44,887
$ 44,931
Reductions due to sale (140 ) (43 )
Accumulated amortization (23,950 ) (21,825 )
Net book value $ 20,797
$ 23,062
Additions during the period $ —
$ 10,359
Amortization during the year $ 2,125
$ 2,833


($ in Thousands)	Three Months Ended March 31, 2020		Year Ended December 31, 2019
Core deposit intangibles
Gross carrying amount at the beginning of the year	$	80,730	$	58,100
Additions during the period	7,379		22,630
Accumulated amortization	(14,597)		(12,456)
Net book value	$	73,512	$	68,274
Amortization during the year	$	2,141	$	7,130
Other intangibles
Gross carrying amount at the beginning of the year	$	38,970	$	44,887
Additions during the period	200		—
Reductions due to sale	(343)		(217)
Accumulated amortization	(19,616)		(24,643)
Net book value	$	19,211	$	20,027
Amortization during the year	$	673	$	2,818

Mortgage Servicing Rights

The Corporation sells residential mortgage loans in the secondary market and typically retains the right to service the loans sold. ~~MSR~~MSRs are amortized in proportion to and over the period of estimated net servicing income and assessed for impairment at each reporting date.

considering interest rates and loan pay off activity) is recognized as a write-down of the ~~MSR~~MSRs asset and the related valuation allowance (to the extent a valuation allowance is available) and then against earnings. A direct write-down permanently reduces the carrying value of the ~~MSR~~MSRs asset and valuation allowance, precluding subsequent recoveries. See Note 12 for a discussion of the recourse provisions on sold residential mortgage loans. See Note 13 which further discusses fair value measurement relative to the ~~MSR~~MSRs asset.

A summary of changes in the balance of the ~~MSR~~MSRs asset and the ~~MSR~~MSRs valuation allowance is as follows:

($ in Thousands) Nine Months Ended September 30, 2019 Year Ended December 31, 2018
Mortgage servicing rights
Mortgage servicing rights at beginning of period $ 68,433
$ 59,168
Additions from acquisition —
8,136
Additions 8,900
10,722
Amortization (8,749 ) (9,594 )
Mortgage servicing rights at end of period $ 68,584
$ 68,433
Valuation allowance at beginning of period $ (239 ) $ (784 )
(Additions) recoveries, net (177 ) 545
Valuation allowance at end of period $ (416 ) $ (239 )
Mortgage servicing rights, net $ 68,168
$ 68,193
Fair value of mortgage servicing rights $ 70,241
$ 81,012
Portfolio of residential mortgage loans serviced for others (“servicing portfolio”) $ 8,688,012
$ 8,600,983
Mortgage servicing rights, net to servicing portfolio 0.78 % 0.79 %
Mortgage servicing rights expense^(a)
$ 8,926
$ 9,049


($ in Thousands)	Three Months Ended March 31, 2020			Year Ended December 31, 2019
Mortgage servicing rights
Mortgage servicing rights at beginning of period	$	67,607		$	68,433
Additions from acquisition	1,357			—
Additions	2,359			11,606
Amortization	(3,635)			(12,432)
Mortgage servicing rights at end of period	$	67,688		$	67,607
Valuation allowance at beginning of period	$	(302)		$	(239)
(Additions) recoveries, net	(9,098)			(63)
Valuation allowance at end of period	$	(9,399)		$	(302)
Mortgage servicing rights, net	$	58,289		$	67,306
Fair value of mortgage servicing rights	$	58,311		$	72,532
Portfolio of residential mortgage loans serviced for others (“servicing portfolio”)	$	8,548,600		$	8,488,969
Mortgage servicing rights, net to servicing portfolio	0.68		%	0.79		%
Mortgage servicing rights expense^(a)	$	12,733		$	12,494

(a) Includes the amortization of mortgage servicing rights and additions / recoveries to the valuation allowance of mortgage servicing rights, and is a component of mortgage banking, net inon the consolidated statements of income.

The projections of amortization expense are based on existing asset balances, the current interest rate environment, and prepayment speeds as of ~~September 30, 2019.~~March 31, 2020. The actual amortization expense the Corporation recognizes in any given period may be significantly different depending upon acquisition or sale activities, changes in interest rates, prepayment speeds, market conditions, regulatory requirements, and events or circumstances that indicate the carrying amount of an asset may not be recoverable. The following table shows the estimated future amortization expense for amortizing intangible assets:


($ in Thousands)	Core Deposit Intangibles		Other Intangibles		Mortgage Servicing Rights
Nine Months Ending December 31, 2020	$	6,608	$	2,008	$	9,609
2021	8,811		2,653		13,307
2022	8,811		2,629		10,456
2023	8,811		2,610		8,279
2024	8,811		2,591		6,632
2025	8,811		2,302		5,372
Beyond 2025	22,849		4,418		14,032
Total Estimated Amortization Expense	$	73,512	$	19,211	$	67,688

($ in Thousands)

Core Deposit Intangibles Other Intangibles Mortgage Servicing Rights
Three Months Ending December 31, 2019 $ 2,018
$ 693
$ 3,234
2020 8,073
2,690
12,262
2021 8,073
2,666
10,074
2022 8,073
2,642
8,259
2023 8,073
2,623
6,777
2024 8,073
2,603
5,574
Beyond 2024 27,909
6,879
22,403
Total Estimated Amortization Expense $ 70,292
$ 20,797
$ 68,584

Note 9 Short and Long-Term Funding

The following table presents the components of short-term funding (funding with original contractual maturities of one year or less), long-term funding (funding with original contractual maturities greater than one year), and FHLB advances (funding based on original contractual maturities):

($ in Thousands) September 30, 2019 December 31, 2018
Short-Term Funding
Federal funds purchased $ 75
$ 19,710
Securities sold under agreements to repurchase 77,953
91,941
Federal funds purchased and securities sold under agreements to repurchase 78,028
111,651
Commercial paper 30,416
45,423
Total short-term funding $ 108,444
$ 157,074
Long-Term Funding
Corporation senior notes, at par, due 2019 $ 250,000
$ 250,000
Bank senior notes, at par, due 2021 300,000
300,000
Corporation subordinated notes, at par, due 2025 250,000
250,000
Other long-term funding and capitalized costs (3,201 ) (4,389 )
Total long-term funding 796,799
795,611
Total short and long-term funding, excluding FHLB advances $ 905,243
$ 952,685
FHLB Advances
Short-term FHLB advances $ 215,000
$ 900,000
Long-term FHLB advances 2,662,727
2,674,371
Total FHLB advances $ 2,877,727
$ 3,574,371

Total short and long-term funding $ 3,782,970
$ 4,527,056


($ in Thousands)	March 31, 2020		December 31, 2019
Short-Term Funding
Federal funds purchased	$	24,480	$	362,000
Securities sold under agreements to repurchase	108,527		71,097
Federal funds purchased and securities sold under agreements to repurchase	133,007		433,097
Commercial paper	33,647		32,016
Total short-term funding	$	166,654	$	465,113
Long-Term Funding

Bank senior notes, at par, due 2021	$	300,000	$	300,000
Corporation subordinated notes, at par, due 2025	250,000		250,000
Finance leases	2,210		2,209
Capitalized costs	(2,565)		(2,866)
Total long-term funding	549,644		549,343
Total short and long-term funding, excluding FHLB advances	$	716,299	$	1,014,456
FHLB Advances
Short-term FHLB advances	$	550,000	$	520,000
Long-term FHLB advances	2,664,194		2,660,967
Total FHLB advances	$	3,214,194	$	3,180,967

Total short and long-term funding	$	3,930,493	$	4,195,422

Securities Sold Under Agreements to Repurchase ("Repurchase Agreements")

The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Corporation may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Corporation to repurchase the assets. The obligation to repurchase the securities is reflected as a liability on the Corporation’s consolidated balance sheets, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts (i.e., there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities). See Note 11 for additional disclosures on balance sheet offsetting.

The Corporation utilizes securities sold under agreements to repurchase to facilitate the needs of its customers. As of ~~September 30, 2019,~~March 31, 2020, the Corporation pledged agency mortgage-related securities with a fair value of ~~$164~~$202 million as collateral for the repurchase agreements. Securities pledged as collateral under repurchase agreements are maintained with the Corporation's safekeeping agents and are monitored on a daily basis due to the market risk of fair value changes in the underlying securities. The Corporation generally pledges excess securities to ensure there is sufficient collateral to satisfy short-term fluctuations in both the repurchase agreement balances and the fair value of the underlying securities.

The remaining contractual maturity of the securities sold under agreements to repurchase inon the consolidated balance sheets as of ~~September 30, 2019~~March 31, 2020 and December 31, ~~2018~~2019 are presented in the following table:


	Remaining Contractual Maturity of the Agreements
($ in Thousands)	Overnight and Continuous		Up to 30 days		30-90 days		Greater than 90 days		Total
March 31, 2020
Repurchase agreements
Agency mortgage-related securities	$	108,527	$	—	$	—	$	—	$	108,527
Total	$	108,527	$	—	$	—	$	—	$	108,257
December 31, 2019
Repurchase agreements
Agency mortgage-related securities	$	71,097	$	—	$	—	$	—	$	71,097
Total	$	71,097	$	—	$	—	$	—	$	71,097

Remaining Contractual Maturity of the Agreements
($ in Thousands) Overnight and Continuous Up to 30 days 30-90 days Greater than 90 days Total
September 30, 2019
Repurchase agreements
Agency mortgage-related securities $ 77,953
$ —
$ —
$ —
$ 77,953
Total $ 77,953
$ —
$ —
$ —
$ 77,953
December 31, 2018
Repurchase agreements
Agency mortgage-related securities $ 91,941
$ —
$ —
$ —
$ 91,941
Total $ 91,941
$ —
$ —
$ —
$ 91,941

In August 2018, the Bank issued $300 million of senior notes, due August 2021, and callable July 2021. The senior notes have a fixed coupon interest rate of 3.50% and were issued at a discount.

In November 2014, the Corporation issued $250 million of senior notes, due November 2019, and callable October 2019. The senior notes had a fixed coupon interest rate of 2.75% and were issued at a discount. On ~~October 15, 2019, these notes were redeemed in full.~~

In November 2014, the Corporation issued $250 million of 10-year subordinated notes, due January 2025, and callable October 2024. The subordinated notes have a fixed coupon interest rate of 4.25% and were issued at a discount.

~~FHLB Advances~~Finance Leases

~~At September 30, 2019,~~In connection with the construction of a new branch in Oshkosh, Wisconsin, the Corporation ~~had $2.9 billion~~entered into a 40-year land lease, maturing August 2059, with an option to purchase the underlying land in August 2022 for a fixed price of ~~FHLB advances, down $697 million from December 31, 2018.~~$1.2 million. The finance lease has a fixed interest rate of 3.99%. See Note 18 for additional disclosure regarding the Corporation’s leases.

At September 30, 2019, the Corporation had $2.4 billion of putable FHLB advances with a one-time option where the FHLB can call the advance prior to the contractual maturity. The contractual weighted average life to the put date of these advances was 0.36 years, with put dates ranging from 2019 through 2020. The weighted average life to contractual maturity on these advances was 5.42 years, with those dates ranging from 2022 through 2028. As of September 30, 2019, due to the lower rate environment, it is probable that none of these advances will be called by the FHLB and will extend to their final maturities.

~~The original contractual maturity or next put date of the Corporation's FHLB advances as of September 30, 2019 and December 31, 2018 are presented in the following table:~~

September 30, 2019 December 31, 2018
($ in Thousands) Amount Weighted Average Contractual Coupon Rate Amount Weighted Average Contractual Coupon Rate
Maturity or put date 1 year or less $ 2,376,052
2.24 % $ 2,262,584
2.06 %
After 1 but within 2 288,174
2.57 % 1,285,039
2.39 %
After 2 but within 3 5,781
5.11 % 14,393
2.98 %
After 3 years 207,720
2.30 % 12,354
4.55 %
FHLB advances and overall rate $ 2,877,727
2.28 % $ 3,574,371
2.19 %

Note 10 Derivative and Hedging Activities

The Corporation is exposed to certain risk arising from both its business operations and economic conditions. The Corporation principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Corporation manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Corporation enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Corporation's derivative financial instruments are used to manage differences in the amount, timing, and duration of the Corporation's known or expected cash receipts and its known or expected cash payments principally related to the Corporation's assets.

The contract or notional amount of a derivative is used to determine, along with the other terms of the derivative, the amounts to be exchanged between the counterparties. The Corporation is exposed to credit risk in the event of nonperformance by counterparties to financial instruments. To mitigate the counterparty risk, contracts generally contain language outlining collateral pledging requirements for each counterparty. For non-centrally cleared derivatives, collateral must be posted when the market value exceeds certain mutually agreed upon threshold limits. Securities and cash are often pledged as collateral. The Corporation pledged ~~$47~~$80 million of investment securities as collateral at ~~September 30, 2019,~~March 31, 2020, and pledged ~~$36~~$57 million of investment securities as collateral at December 31, ~~2018.~~2019. At ~~September 30, 2019,~~March 31, 2020, the Corporation posted ~~$15~~$36 million of cash collateral compared to $1$14 million at December 31, ~~2018.~~

Federal regulations require the Corporation to clear all LIBOR interest rate swaps through a clearing house, if possible. For derivatives cleared through central clearing houses the variation margin payments are legally characterized as daily settlements of the derivative rather than collateral. The Corporation's clearing agent for interest rate derivative contracts that are centrally cleared through the Chicago Mercantile Exchange (CME) and the London Clearing House (LCH) settles the variation margin daily. As a result, the variation margin payment and the related derivative instruments are considered a single unit of account for accounting and financial reporting purposes. Depending on the net position, the fair value is reported in other assets or accrued expenses and other liabilities on the consolidated balance sheets. The daily settlement of the derivative exposure does not change or reset the contractual terms of the instrument.

Fair Value Hedges of Interest Rate Risk

The Corporation is exposed to changes in the fair value of certain of its pools of prepayable fixed-rate assets due to changes in benchmark interest rates. The Corporation ~~uses~~used interest rate swaps to manage its exposure to changes in fair value on these instruments attributable to changes in the designated benchmark interest rate. Interest rate swaps designated as fair value hedges ~~involve~~involved the payment of fixed-rate amounts to a counterparty in exchange for the Corporation receiving variable-rate payments over the life of the agreements without the exchange of the underlying notional amount.

For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk ~~are~~were recognized in interest income. During the fourth quarter of 2019, the Corporation terminated the outstanding fair value hedges.

Derivatives to Accommodate Customer Needs

The Corporation also facilitates customer borrowing activity by entering into various derivative contracts which are designated as free standing derivative contracts. Free standing derivative products are entered into primarily for the benefit of commercial customers seeking to manage their exposures to interest rate risk, foreign currency, and commodity prices. These derivative contracts are not designated against specific assets and liabilities on the consolidated balance sheets or forecasted transactions and, therefore, do not qualify for hedge accounting treatment. Such derivative contracts are carried at fair value in other assets and accrued expenses and other liabilities on the consolidated balance sheets with changes in the fair value recorded as a component of capital markets, net, and typically include interest rate-related instruments (swaps and caps), foreign currency exchange forwards, and commodity contracts. See Note 11 for additional information and disclosures on balance sheet offsetting.

Interest rate-related instruments: The Corporation provides interest rate risk management services to commercial customers, primarily forward interest rate swaps and caps. The Corporation’s market risk from unfavorable movements in interest rates related to these derivative contracts is generally economically hedged by concurrently entering into offsetting derivative contracts. The offsetting derivative contracts have identical notional values, terms, and indices.

Foreign currency exchange forwards: The Corporation provides foreign currency exchange services to customers, primarily forward contracts. The Corporation's customers enter into a foreign currency exchange forward with the Corporation as a means for them to mitigate exchange rate risk. The Corporation mitigates its risk by then entering into an offsetting foreign currency exchange derivative contract.

Commodity contracts: Commodity contracts are entered into primarily for the benefit of commercial customers seeking to manage their exposure to fluctuating commodity prices. The Corporation mitigates its risk by then entering into an offsetting commodity derivative contract.

Mortgage Derivatives

Interest rate lock commitments to originate residential mortgage loans held for sale and forward commitments to sell residential mortgage loans are considered derivative instruments, and the fair value of these commitments is recorded in other assets and accrued expenses and other liabilities on the consolidated balance sheets with the changes in fair value recorded as a component of mortgage banking, net.

~~Written and Purchased Options (Time Deposit)~~

Historically, the Corporation had entered into written and purchased option derivative instruments to facilitate an equity linked time deposit product (the “Power CD”), which the Corporation ceased offering in September 2013. The Power CD was a time deposit that provided the purchaser a guaranteed return of principal at maturity plus a potential equity return (a written option), while the Corporation received a known stream of funds based on the equity return (a purchased option). The written and purchased options are mirror derivative instruments, which are carried at fair value on the consolidated balance sheets.

The following table presents the total notional amounts and gross fair values of the Company’s derivatives, as well as the balance sheet netting adjustments ~~on an aggregate basis~~ as of ~~September 30, 2019~~March 31, 2020 and December 31, ~~2018.~~2019. The derivative assets and liabilities are presented on a gross basis prior to the application of bilateral collateral and master netting agreements, but after the variation margin payments with central clearing organizations have been applied as settlement, as applicable. Total derivative assets and liabilities are adjusted to take into consideration the effects of legally enforceable master netting agreements and cash collateral received or paid as of ~~September 30, 2019~~March 31, 2020 and December 31, ~~2018.~~2019. The resulting net derivative asset and liability fair values are included in other assets and accrued expenses and other liabilities, respectively, on the consolidated balance sheets.

September 30, 2019 December 31, 2018
Asset Liability Asset Liability
($ in Thousands) Notional Amount Fair Value Notional Amount Fair Value Notional Amount Fair Value Notional Amount Fair Value
Designated as hedging instruments
Interest rate-related instruments $ 500,000
$ 114
$ —
$ —
$ —
$ —
$ 500,000
$ 40
Not designated as hedging instruments
Interest rate-related instruments 2,799,863
100,376
2,799,863
17,586
2,707,204
52,796
2,707,204
52,653
Foreign currency exchange forwards 211,475
3,153
184,476
2,823
117,879
721
69,153
675
Commodity contracts 259,210
25,388
258,483
24,758
331,727
35,426
315,861
34,340
Mortgage banking^(a)
300,515
2,017
227,060
590
191,222
2,208
139,984
2,072
Time deposits 518
13
518
13
11,185
109
11,185
109
Total not designated as hedging instruments

130,947

45,770

91,260

89,849
Gross derivatives before netting

131,061

45,770

91,260

89,889
Less: Legally enforceable master netting agreements 4,629
4,629
5,322
5,322
Less: Cash collateral pledged/received 16,182
14,680
27,593
63
Total derivative instruments, after netting^(b)
$ 110,250
$ 26,461
$ 58,345
$ 84,504


	March 31, 2020																December 31, 2019
	Asset						Liability								Asset						Liability
($ in Thousands)	Notional Amount		Fair Value		Notional Amount		Fair Value				Notional Amount		Fair Value		Notional Amount		Fair Value



Not designated as hedging instruments

Interest rate-related instruments	$	3,430,859	$	220,445	$	3,430,859	$	30,449			$	3,029,877	$	77,024	$	3,029,877	$	13,073
Foreign currency exchange forwards	322,066		9,272		295,774		9,215				272,636		4,226		264,653		4,048
Commodity contracts	208,621		69,241		203,955		67,592				255,089		20,528		255,165		19,624

Mortgage banking^(a)	343,193		12,454		471,000		10,972				255,291		2,527		263,000		710


Gross derivatives before netting			$	311,413			$	118,228					$	104,305			$	37,455
Less: Legally enforceable master netting agreements					2,847				2,847						10,410				10,410
Less: Cash collateral pledged/received					69,654				30,645						1,408				11,365
Total derivative instruments, after netting					$	238,912			$	84,736					$	92,487			$	15,680

(a) Mortgage derivative assets include interest rate lock commitments and mortgage derivative liabilities include forward commitments.

Table of ~~derivative assets are included in other assets, while the fair values of derivative liabilities are included in accrued expenses and other liabilities, in the consolidated balance sheets.~~Contents

The ~~following table presents amounts that were recorded on the consolidated balance sheets related to cumulative basis adjustments for~~Corporation terminated its $500 million fair value ~~hedges:~~

Line Item in the Consolidated Balance Sheets in Which the Hedged Item is Included
Carrying Amount of the Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities)
($ in Thousands) September 30, 2019
Loans and investment securities receivables^(a)
$ 506,111
$ 6,111
Total $ 506,111
$ 6,111

~~(a) These amounts include~~hedge during the ~~amortized cost basis~~fourth quarter of ~~closed portfolios used in designated hedging relationships in which the hedged item is the last layer expected to be remaining at the end of the hedging relationship.~~2019. At ~~September 30, 2019,~~March 31, 2020, the amortized cost basis of the closed portfolios which had previously been used in ~~these~~the terminated hedging ~~relationships~~relationship was ~~$947 million;~~$829 million and is included in loans and investment securities, available for sale, at fair value on the ~~positive cumulative basis~~consolidated balance sheets. This amount includes $5 million of hedging adjustments ~~associated with these~~on the discontinued hedging ~~relationships was $6 million; and the amounts of the designated hedged items were $500 million.~~relationships.

The table below identifies the effect of fair value hedge accounting on the Corporation's consolidated statements of income for the three ~~and nine~~ months ended ~~September 30, 2019~~March 31, 2020 and ~~2018:~~2019:


	Location and Amount of Gain or (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships
	Three Months Ended March 31, 2020						Three Months Ended March 31, 2019

($ in Thousands)	Interest Income		Other Income (Expense)		Interest Income		Other Income (Expense)
Total amounts of income and expense line items presented on the consolidated statements of income in which the effects of the fair value hedge is recorded	$	(322)	$	(262)	$	166	$	—
The effects of fair value hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20
Interest contracts
Hedged items	(322)		(262)		2,057		—
Derivatives designated as hedging instruments^(a)	—		—		(1,891)		—

Location and Amount of Gain or (Loss) Recognized in Income on
Fair Value and Cash Flow Hedging Relationships
Three Months Ended September 30, Nine Months Ended September 30,
2019 2018 2019 2018
($ in Thousands) Interest Income Other Income (Expense) Interest Income Other Income (Expense) Interest Income Other Income (Expense) Interest Income Other Income (Expense)
Total amounts of income and expense line items presented in the consolidated statements of income in which the effects of the fair value hedge is recorded $ (59 ) $ —
$ (17 ) $ —
$ 160
$ —
$ (30 ) $ —
The effects of fair value hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20

Interest contracts

Hedged items 452
—
(2,522 ) —
6,674
—
(4,931 ) —
Derivatives designated as hedging instruments^(a)
(511 ) —
2,506
—
(6,514 ) —
4,902
—

(a) Includes net settlements on the derivatives.

The table below identifies the effect of derivatives not designated as hedging instruments on the Corporation's consolidated statements of income for the three ~~and nine~~ months ended ~~September 30, 2019~~March 31, 2020 and ~~2018:~~2019:


	Consolidated Statements of Income Category of Gain / (Loss) Recognized in Income	Three Months Ended March 31,
($ in Thousands)				2020			2019
Derivative Instruments
Interest rate-related instruments — customer and mirror, net	Capital markets, net	$	(3,090)		$	(672)
Foreign currency exchange forwards	Capital markets, net	(122)			26
Commodity contracts	Capital markets, net	746			(567)
Interest rate lock commitments (mortgage)	Mortgage banking, net	9,928			824
Forward commitments (mortgage)	Mortgage banking, net	(10,262)			247

Consolidated Statements of Income Category of
Gain / (Loss)
Recognized in Income
Three Months Ended September 30, Nine Months Ended September 30,
($ in Thousands) 2019 2018 2019 2018
Derivative Instruments
Interest rate-related instruments — customer and mirror, net Capital markets, net $ (619 ) $ 246
$ (2,309 ) $ 354
Foreign currency exchange forwards Capital markets, net 72
(92 ) 284
(22 )
Commodity contracts Capital markets, net 208
(72 ) (456 ) (958 )
Interest rate lock commitments (mortgage) Mortgage banking, net (2,851 ) (1,602 ) (191 ) 147
Forward commitments (mortgage) Mortgage banking, net 1,313
2,271
1,482
1,665

Note 11 Balance Sheet Offsetting

Interest Rate-Related Instruments, Commodity Contracts, and Foreign Exchange Forwards (“Interest, Commodity, and Foreign Exchange Agreements”)

The Corporation enters into interest rate-related instruments to facilitate the interest rate risk management strategies of commercial customers, commodity contracts to manage commercial customers' exposure to fluctuating commodity prices, and foreign exchange forwards to manage customers' exposure to fluctuating foreign exchange rates. The Corporation mitigates these risks by entering into equal and offsetting agreements with highly rated third-party financial institutions. The Corporation

is party to master netting arrangements with its financial institution counterparties that create single net settlements of all legal claims or obligations to pay or receive the net amount of settlement of the individual interest, commodity, and foreign exchange agreements. Collateral, usually in the form of investment securities and cash, is posted by the counterparty with net liability positions in accordance with contract thresholds. Derivatives subject to a legally enforceable master netting agreement are reported on a net basis, net of cash collateral, in other assets and accrued expenses and other liabilities, on the face of the consolidated balance sheets. In the third quarter of 2019, the Corporation elected to offset derivative assets and liabilities and cash collateral with the same counterparty where it has a legally enforceable master netting agreement in place. See ~~the derivatives section within Note 3 for additional information on the change in accounting policy and~~ Note 10 for additional information on the Corporation’s derivative and hedging activities.

Securities Sold Under Agreements to Repurchase (“Repurchase Agreements”)

The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. These repurchase agreements are accounted for as collateralized financing arrangements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities (i.e., there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities). The right of set-off for a repurchase agreement resembles a secured borrowing, whereby the collateral would be used to settle the fair value of the repurchase agreement should the Corporation be in default (e.g., fails to make an interest payment to the counterparty). In addition, the Corporation does not enter into reverse repurchase

agreements; therefore, there is no such offsetting to be done with the repurchase agreements. See Note 9 for additional disclosures on repurchase agreements.

The following table presents the interest rate, commodity, and foreign exchange assets and liabilities subject to an enforceable master netting arrangement. The interest, commodity and foreign exchange agreements the Corporation has with its commercial customers are not subject to an enforceable master netting arrangement and are therefore excluded from this table:


	Gross Amounts Recognized		Gross Amounts Subject to Master Netting Arrangements Offset on the Consolidated Balance Sheets						Net Amounts Presented on the Consolidated Balance Sheets		Investment Securities Received
($ in Thousands)					Derivative Assets Offset		Cash Collateral Received						Net amount
Derivative assets
March 31, 2020	$	72,501	$	(2,847)	$	(69,654)	$	—	$	—	$	—
December 31, 2019	11,864		(10,410)		(1,408)		45		—		45

	Gross Amounts Recognized		Gross Amounts Subject to Master Netting Arrangements Offset on the Consolidated Balance Sheets						Net Amounts Presented on the Consolidated Balance Sheets		Investment Securities Pledged
($ in Thousands)					Derivative Liabilities Offset		Cash Collateral Pledged						Net amount
Derivative liabilities
March 31, 2020	$	34,014	$	(2,847)	$	(30,645)	$	523	$	—	$	523
December 31, 2019	22,189		(10,410)		(11,365)		413		—		413

Gross Amounts Recognized Gross Amounts Subject to Master Netting Arrangements Offset on the Consolidated Balance Sheets Net Amounts Presented on the Consolidated Balance Sheets Gross Amounts Not Offset on the Consolidated Balance Sheets
($ in Thousands)
Derivative
Liabilities Offset
Cash Collateral Received Net amount
Derivative assets^(a)

September 30, 2019 $ 24,930
$ (4,629 ) $ (16,182 ) $ 4,118
$ —
$ 4,118
December 31, 2018 65,596
(5,322 ) (27,593 ) 32,681
(31,837 ) 843

Gross Amounts Recognized Gross Amounts Subject to Master Netting Arrangements Offset on the Consolidated Balance Sheets Net Amounts Presented on the Consolidated Balance Sheets Gross Amounts Not Offset on the Consolidated Balance Sheets
($ in Thousands)
Derivative
Assets Offset
Cash Collateral Pledged Net amount
Derivative liabilities^(a)

September 30, 2019 $ 19,537
$ (4,629 ) $ (14,680 ) $ 228
$ —
$ 228
December 31, 2018 22,951
(5,322 ) (63 ) 17,567
(17,551 ) 16

~~(a) Includes interest, commodity, and foreign exchange agreements~~

Note 12 Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters



Title of each class	Trading symbol	Name of each exchange on which registered
Common stock, par value $0.01 per share	ASB	New York Stock Exchange
Depositary Shrs, each representing 1/40th intrst in a shr of 6.125% Non-Cum. Perp Pref Stock, Srs C	ASB PrC	New York Stock Exchange
Depositary Shrs, each representing 1/40th intrst in a shr of 5.375% Non-Cum. Perp Pref Stock, Srs D	ASB PrD	New York Stock Exchange
Depositary Shrs, each representing 1/40th intrst in a shr of 5.875% Non-Cum. Perp Pref Stock, Srs E	ASB PrE	New York Stock Exchange


					Page
PART I. Financial Information

				~~Page~~
~~PART I. Financial Information~~

	Item 1. Financial Statements (Unaudited):			4

			Consolidated Balance Sheets		45

			Consolidated Statements of Income		56

			Consolidated Statements of Comprehensive Income		67

			Consolidated Statements of Changes in Stockholders’ Equity		78

			Consolidated Statements of Cash Flows		109

			Notes to Consolidated Financial Statements		1211

			Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		5957

			Item 3. Quantitative and Qualitative Disclosures About Market Risk		8482

			Item 4. Controls and Procedures		8482

PART II. Other Information

			Item 1. Legal Proceedings		8584

			Item 1 A . Risk Fac tors		84

			Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		8586

	~~Item 6. Exhibits~~	86

	~~Signatures~~	87


	Three Months Ended September 30,					Nine Months Ended September 30,						Three Months Ended March 31,
(In Thousands, except per share data)	2019		2018			2019		2018			(In Thousands, except per share data)	2020		2019
Interest income											Interest income
Interest and fees on loans	$	248,579	$	249,649		$	768,216	$	716,329		Interest and fees on loans	$	224,786	$	258,853
Interest and dividends on investment securities											Interest and dividends on investment securities
Taxable	23,485		29,895			79,248		90,622			Taxable	20,272		29,053
Tax-exempt	14,491		11,883			42,950		31,883			Tax-exempt	14,882		13,816
Other interest	4,865		4,036			13,086		9,366			Other interest	3,304		4,226
Total interest income	291,420		295,464			903,500		848,201			Total interest income	263,244		305,948
Interest expense											Interest expense
Interest on deposits	61,585		50,116			191,408		121,959			Interest on deposits	36,666		62,773
Interest on federal funds purchased and securities sold under agreements to repurchase	145		504			1,058		1,564			Interest on federal funds purchased and securities sold under agreements to repurchase	368		627
Interest on other short-term funding	33		38			121		150			Interest on other short-term funding	39		51
Interest on FHLB advances	15,896		19,318			53,194		53,720			Interest on FHLB advances	17,626		19,554
Interest on long-term funding	7,396		6,095			22,188		15,183			Interest on long-term funding	5,604		7,396
Total interest expense	85,054		76,072			267,969		192,576			Total interest expense	60,303		90,401
Net interest income	206,365		219,392			635,532		655,625			Net interest income	202,942		215,547
Provision for credit losses	2,000		(5,000		)	16,000		(1,000		)	Provision for credit losses	53,001		6,000
Net interest income after provision for credit losses	204,365		224,392			619,532		656,625			Net interest income after provision for credit losses	149,941		209,547
Noninterest income											Noninterest income
Insurance commissions and fees	20,954		21,636			69,403		68,279			Insurance commissions and fees	22,608		25,464
Wealth management fees^(a)	21,015		21,224			61,885		62,198			Wealth management fees^(a)	20,816		20,180
Service charges on deposit account fees	16,561		16,904			47,102		49,714
Service charges and deposit account fees											Service charges and deposit account fees	15,222		15,115
Card-based fees	10,456		9,783			29,848		29,341			Card-based fees	9,597		9,261
Other fee-based revenue	5,085		4,307			14,246		12,559			Other fee-based revenue	4,497		3,983
Capital markets, net	4,300		5,099			12,215		15,189			Capital markets, net	7,935		3,189
Mortgage banking, net	10,940		4,012			25,118		16,640			Mortgage banking, net	6,143		4,712
Bank and corporate owned life insurance	4,337		3,540			11,482		10,705			Bank and corporate owned life insurance	3,094		3,792
Asset gains (losses), net^(b)	877		(1,037		)	2,316		1,353
Asset gains (losses), net											Asset gains (losses), net	(77)		567
Investment securities gains (losses), net	3,788		30			5,931		(1,985		)	Investment securities gains (losses), net	6,118		1,680
Other	2,537		2,802			8,344		7,529			Other	2,352		3,260
Total noninterest income	100,850		88,300			287,890		271,522			Total noninterest income	98,306		91,202
Noninterest expense											Noninterest expense
Personnel	123,170		124,476			366,449		366,141			Personnel	114,200		120,050
Technology	20,572		17,563			59,698		54,730			Technology	20,799		19,012
Occupancy	15,164		14,519			45,466		44,947			Occupancy	16,069		16,472
Business development and advertising	7,991		8,213			21,284		21,973			Business development and advertising	5,826		6,636
Equipment	6,335		5,838			17,580		17,347			Equipment	5,439		5,668
Legal and professional	5,724		5,476			14,342		17,173			Legal and professional	5,160		3,951
Loan and foreclosure costs	1,638		2,439			5,599		5,844			Loan and foreclosure costs	3,120		2,146
FDIC assessment	4,000		7,750			12,250		24,250			FDIC assessment	5,500		3,750
Other intangible amortization	2,686		2,233			7,237		5,926			Other intangible amortization	2,814		2,226
Acquisition related costs^(c)	1,629		2,271			5,995		29,983
Acquisition related costs^(b)											Acquisition related costs^(b)	1,721		632
Other	12,021		13,634			34,479		40,323			Other	11,543		11,128
Total noninterest expense	200,930		204,413			590,380		628,636			Total noninterest expense	192,191		191,671
Income (loss) before income taxes	104,286		108,279			317,042		299,510			Income (loss) before income taxes	56,056		109,078
Income tax expense	20,947		22,349			62,356		54,932			Income tax expense	10,219		22,392
Net income	83,339		85,929			254,686		244,578			Net income	45,838		86,686
Preferred stock dividends	3,801		2,409			11,402		7,077			Preferred stock dividends	3,801		3,801
Net income available to common equity	$	79,539	$	83,521		$	243,285	$	237,501		Net income available to common equity	$	42,037	$	82,885
Earnings per common share											Earnings per common share
Basic	$	0.50	$	0.49		$	1.49	$	1.40		Basic	$	0.27	$	0.50
Diluted	$	0.49	$	0.48		$	1.48	$	1.38		Diluted	$	0.27	$	0.50
Average common shares outstanding											Average common shares outstanding
Basic	159,126		170,516			161,727		168,249			Basic	154,701		163,928
Diluted	160,382		172,802			163,061		170,876			Diluted	155,619		165,433


	Three months ended						Nine months ended							Three months ended
	September 30,						September 30,							March 31,
($ in Thousands)	2019			2018			2019			2018			($ in Thousands)	2020		2019

Net income	$	83,339		$	85,929		$	254,686		$	244,578		Net income	$	45,838	$	86,686
Other comprehensive income, net of tax													Other comprehensive income, net of tax
Investment securities available for sale													Investment securities available for sale
Net unrealized gains (losses)	33,173			(21,345		)	123,139			(82,099		)	Net unrealized gains (losses)	26,419		30,490
Amortization of net unrealized (gains) losses on available for sale securities transferred to held to maturity securities	(8		)	(52		)	279			(684		)	Amortization of net unrealized (gains) losses on available for sale securities transferred to held to maturity securities	556		69
Reclassification adjustment for net losses (gains) realized in net income	(3,788		)	(30		)	(5,931		)	1,985			Reclassification adjustment for net losses (gains) realized in net income	(6,118)		(1,680)
Reclassification from OCI due to change in accounting principle	—			—			—			(84		)
Reclassification of certain tax effects from OCI	—			—			—			(8,419		)

Income tax (expense) benefit	(7,410		)	5,456			(29,651		)	20,796			Income tax (expense) benefit	(5,225)		(7,301)
Other comprehensive income (loss) on investment securities available for sale	21,967			(15,971		)	87,836			(68,505		)	Other comprehensive income (loss) on investment securities available for sale	15,632		21,578
Defined benefit pension and postretirement obligations													Defined benefit pension and postretirement obligations
Amortization of prior service cost	(36		)	(37		)	(111		)	(112		)	Amortization of prior service cost	(38)		(38)
Amortization of actuarial loss (gain)	229			551			357			1,480			Amortization of actuarial loss (gain)	808		64
Reclassification of certain tax effects from OCI	—			—			—			(5,235		)

Income tax (expense) benefit	(49		)	(174		)	(62		)	(390		)	Income tax (expense) benefit	(193)		(7)
Other comprehensive income (loss) on pension and postretirement obligations	144			340			184			(4,257		)	Other comprehensive income (loss) on pension and postretirement obligations	577		20
Total other comprehensive income (loss)	22,111			(15,631		)	88,020			(72,762		)	Total other comprehensive income (loss)	16,209		21,597
Comprehensive income	$	105,450		$	70,298		$	342,706		$	171,816		Comprehensive income	$	62,046	$	108,283



	September 30, 2019			December 31, 2018
(In Thousands, except share and per share data)	(Unaudited)			(Audited)
Assets
Cash and due from banks	$	523,435		$	507,187
Interest-bearing deposits in other financial institutions	236,010			221,226
Federal funds sold and securities purchased under agreements to resell	100			148,285
Investment securities held to maturity, at amortized cost^(a)	2,200,419			2,740,511
Investment securities available for sale, at fair value^(a)	3,436,289			3,946,941
Equity securities	15,096			1,568
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost	207,443			250,534
Residential loans held for sale	137,655			64,321
Commercial loans held for sale	11,597			14,943
Loans	22,754,710			22,940,429
Allowance for loan losses	(214,425		)	(238,023		)
Loans, net	22,540,285			22,702,406
Bank and corporate owned life insurance	670,739			663,203
Investment in unconsolidated subsidiaries	256,220			161,181
Premises and equipment, net	436,268			363,225
Goodwill	1,176,230			1,169,023
Mortgage servicing rights, net	68,168			68,193
Other intangible assets, net	91,089			75,836
Other assets^(b)	589,420			516,538
Total assets	$	32,596,460		$	33,615,122
Liabilities and Stockholders' Equity
Noninterest-bearing demand deposits	$	5,503,223		$	5,698,530
Interest-bearing deposits	18,919,339			19,198,863
Total deposits	24,422,562			24,897,393
Federal funds purchased and securities sold under agreements to repurchase	78,028			111,651
Commercial paper	30,416			45,423
FHLB advances	2,877,727			3,574,371
Other long-term funding	796,799			795,611
Accrued expenses and other liabilities^(b)	470,073			409,787
Total liabilities	28,675,605			29,834,235
Stockholders’ Equity
Preferred equity	256,716			256,716
Common equity
Common stock	1,752			1,752
Surplus	1,713,971			1,712,615
Retained earnings	2,341,158			2,181,414
Accumulated other comprehensive income (loss)	(36,953		)	(124,972		)
Treasury stock, at cost	(355,791		)	(246,638		)
Total common equity	3,664,139			3,524,171
Total stockholders’ equity	3,920,855			3,780,888
Total liabilities and stockholders’ equity	$	32,596,460		$	33,615,122
Preferred shares issued	264,458			264,458
Preferred shares authorized (par value $1.00 per share)	750,000			750,000
Common shares issued	175,216,409			175,216,409
Common shares authorized (par value $0.01 per share)	250,000,000			250,000,000
Treasury shares of common stock	15,925,525			10,775,938



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(In Thousands, except per share data)	2019			2018			2019			2018
Net income	$	83,339		$	85,929		$	254,686		$	244,578
Preferred stock dividends	(3,801		)	(2,409		)	(11,402		)	(7,077		)
Net income available to common equity	$	79,539		$	83,521		$	243,285		$	237,501
Common shareholder dividends	(27,091		)	(25,486		)	(82,741		)	(77,035		)
Unvested share-based payment awards	(198		)	(128		)	(506		)	(396		)
Undistributed earnings	$	52,250		$	57,907		$	160,037		$	160,070
Undistributed earnings allocated to common shareholders	51,870			57,620			158,970			159,297
Undistributed earnings allocated to unvested share-based payment awards	380			288			1,067			772
Undistributed earnings	$	52,250		$	57,907		$	160,037		$	160,070
Basic
Distributed earnings to common shareholders	$	27,091		$	25,486		$	82,741		$	77,035
Undistributed earnings allocated to common shareholders	51,870			57,620			158,970			159,297
Total common shareholders earnings, basic	$	78,961		$	83,106		$	241,711		$	236,332
Diluted
Distributed earnings to common shareholders	$	27,091		$	25,486		$	82,741		$	77,035
Undistributed earnings allocated to common shareholders	51,870			57,620			158,970			159,297
Total common shareholders earnings, diluted	$	78,961		$	83,106		$	241,711		$	236,332
Weighted average common shares outstanding	159,126			170,516			161,727			168,249
Effect of dilutive common stock awards	1,256			2,188			1,334			2,101
Effect of dilutive common stock warrants	—			98			—			526
Diluted weighted average common shares outstanding	160,382			172,802			163,061			170,876
Basic earnings per common share	$	0.50		$	0.49		$	1.49		$	1.40
Diluted earnings per common share	$	0.49		$	0.48		$	1.48		$	1.38



	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
($ in Thousands)	Number of Loans	Recorded Investment^(a)		Unpaid Principal Balance^(b)		Number of Loans	Recorded Investment^(a)		Unpaid Principal Balance^(b)
Commercial and industrial	1	$	185	$	185	6	$	1,954	$	1,995
Commercial real estate — investor	—	—		—		1	958		1,022
Residential mortgage	47	6,785		6,863		29	5,655		5,733
Home equity	18	520		520		32	1,552		1,582
Other consumer	1	9		9		3	19		21
Total loans modified	67	$	7,500	$	7,577	71	$	10,138	$	10,353



($ in Thousands)	Commercial and industrial			Commercial real estate - owner occupied			Commercial real estate - investor			Real estate construction			Residential mortgage			Home equity			Other consumer			Total
December 31, 2018	$	108,835		$	9,255		$	40,844		$	28,240		$	25,595		$	19,266		$	5,988		$	238,023
Charge offs	(49,845		)	(222		)	—			(60		)	(1,754		)	(1,605		)	(4,074		)	(57,560		)
Recoveries	10,322			2,795			31			230			539			1,878			667			16,462
Net Charge offs	(39,523		)	2,573			31			170			(1,215		)	273			(3,407		)	(41,098		)
Provision for loan losses	36,419			(3,229		)	(971		)	(4,960		)	(5,757		)	(7,690		)	3,688			17,500
September 30, 2019	$	105,730		$	8,599		$	39,904		$	23,451		$	18,623		$	11,849		$	6,269		$	214,425
Allowance for loan losses
Individually evaluated for impairment	$	17,791		$	19		$	101		$	56		$	3,824		$	1,313		$	187		$	23,291
Collectively evaluated for impairment	87,939			8,579			39,803			23,395			14,799			10,536			6,082			191,133
Total allowance for loan losses	$	105,730		$	8,599		$	39,904		$	23,451		$	18,623		$	11,849		$	6,269		$	214,425
Loans
Individually evaluated for impairment	$	70,568		$	1,912		$	5,104		$	409		$	36,039		$	4,648		$	1,244		$	119,925
Collectively evaluated for impairment	7,424,690			912,935			3,798,039			1,356,088			7,918,265			874,968			348,091			22,633,075
Acquired and accounted for under ASC 310-30^(a)	365			677			134			11			497			26			—			1,710
Total loans	$	7,495,623		$	915,524		$	3,803,277		$	1,356,508		$	7,954,801		$	879,642		$	349,335		$	22,754,710



($ in Millions)	Nine Months Ended September 30, 2019			Year Ended December 31, 2018
Balance at beginning of period	$	12		$	27
Charge offs	(39		)	(24		)
Recoveries	5			6
Net Charge offs	(34		)	(17		)
Provision for loan losses	44			2
Balance at end of period	$	21		$	12
Allowance for loan losses
Individually evaluated for impairment	$	11		$	—
Collectively evaluated for impairment	10			12
Total allowance for loan losses	$	21		$	12
Loans
Individually evaluated for impairment	$	36		$	22
Collectively evaluated for impairment	545			725
Total loans	$	582		$	747



	Line Item in the Consolidated Balance Sheets in Which the Hedged Item is Included
	Carrying Amount of the Hedged Assets/(Liabilities)		Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities)
($ in Thousands)	September 30, 2019
Loans and investment securities receivables^(a)	$	506,111	$	6,111
Total	$	506,111	$	6,111



($ in Thousands)	Fair Value Hierarchy	September 30, 2019		December 31, 2018
Assets
Investment securities available for sale
U.S. Treasury securities	Level 1	$	—	$	999
Obligations of state and political subdivisions (municipal securities)	Level 2	553,418		—
Residential mortgage-related securities
FNMA / FHLMC	Level 2	143,009		295,252
GNMA	Level 2	1,080,584		2,128,531
Private-label	Level 2	758		1,003
Commercial mortgage-related securities
FNMA / FHLMC	Level 2	21,791		—
GNMA	Level 2	1,363,948		1,220,797
FFELP asset backed securities	Level 2	269,789		297,360
Other debt securities	Level 2	2,993		3,000
Total investment securities available for sale	Level 1	$	—	$	999
Total investment securities available for sale	Level 2	$	3,436,289	$	3,945,943
Equity securities with readily determinable fair values	Level 1	1,652		1,568
Residential loans held for sale	Level 2	137,655		64,321
Interest rate-related instruments^(a)	Level 2	100,376		52,796
Foreign currency exchange forwards^(a)	Level 2	3,153		721
Commodity contracts^(a)	Level 2	25,388		35,426
Purchased options (time deposit)	Level 2	13		109
Interest rate products (designated as hedging instruments)	Level 2	114		—
Interest rate lock commitments to originate residential mortgage loans held for sale	Level 3	2,017		2,208
Liabilities
Interest rate-related instruments^(a)	Level 2	$	17,586	$	52,653
Foreign currency exchange forwards^(a)	Level 2	2,823		675
Commodity contracts^(a)	Level 2	24,758		34,340
Written options (time deposit)	Level 2	13		109
Interest rate products (designated as hedging instruments)	Level 2	—		40
Forward commitments to sell residential mortgage loans	Level 3	590		2,072


($ in Thousands)	Derivative Financial Instruments
Balance December 31, 2018	$	140
Total net gains (losses) included in income

Mortgage derivative gain (loss)	1,681

Balance December 31, 2019	$	1,817
Total net gains (losses) included in income

Mortgage derivative gain (loss)	(334)

Balance March 31, 2020	$	1,482



($ in Thousands)	Derivative Financial Instruments
Balance December 31, 2017	$	1,225
Total net gains (losses) included in income
Mortgage derivative gain (loss)	(1,085		)
Balance December 31, 2018	$	140
Total net gains (losses) included in income
Mortgage derivative gain (loss)	1,292
Balance September 30, 2019	$	1,428


($ in Thousands)
Equity securities without readily determinable fair values
Carrying value as of December 31, 2019	$	13,444
Carrying value changes	—

Carrying value as of March 31, 2020	$	13,444

Cumulative upward carrying value changes between January 1, 2018 and March 31, 2020	$	13,444
Cumulative downward carrying value changes/impairment between January 1, 2018 and March 31, 2020	$	—



($ in Thousands)
Equity securities without readily determinable fair values
Carrying value as of December 31, 2018	$	—
Upward carrying value changes	13,444
Carrying value as of September 30, 2019	$	13,444

Cumulative upward carrying value changes between January 1, 2018 and September 30, 2019	$	13,444
Cumulative downward carrying value changes/impairment between January 1, 2018 and September 30, 2019	$	—



				Consolidated Statements of Income Category of Adjustment Recognized in Income	Adjustment Recognized in the Consolidated Statements of Income
($ in Thousands)	Fair Value Hierarchy	Fair Value
September 30, 2019
Assets
Impaired loans^(a)	Level 3	$	51,501	Provision for credit losses^(b)	$	(60,627	)
OREO^(c)	Level 2	2,413		Other noninterest expense	(1,453		)
Mortgage servicing rights	Level 3	70,241		Mortgage banking, net	(177		)
Equity securities	Level 3	13,444		Investment securities gains (losses), net	13,444

December 31, 2018
Assets
Impaired loans^(a)	Level 3	$	26,191	Provision for credit losses^(b)	$	(14,521	)
OREO^(c)	Level 2	2,200		Other noninterest expense	(1,545		)
Mortgage servicing rights	Level 3	81,012		Mortgage banking, net	545


March 31, 2020	Valuation Technique	Significant Unobservable Input	Range of Inputs				Weighted Average Input Applied
Mortgage servicing rights	Discounted cash flow	Discount rate	9%	-	14%	9%
Mortgage servicing rights	Discounted cash flow	Constant prepayment rate	7%	-	31%	15%
Individually evaluated loans	Appraisals / Discounted cash flow	Collateral / Discount factor	5%	-	67%	44%



	~~Valuation Technique~~	~~Significant Unobservable Input~~	~~Weighted Average Input Applied~~
~~September 30, 2019~~	~~Valuation Technique~~	~~Significant Unobservable Input~~	~~Weighted Average Input Applied~~
~~Mortgage servicing rights~~	~~Discounted cash flow~~	~~Discount rate~~	9%
~~Mortgage servicing rights~~	~~Discounted cash flow~~	~~Constant prepayment rate~~	~~13%~~
~~Impaired Loans~~	~~Appraisals / Discounted cash flow~~	~~Collateral / Discount factor~~	~~48%~~



		September 30, 2019				December 31, 2018
	Fair Value Hierarchy Level	Carrying Amount		Fair Value		Carrying Amount		Fair Value
($ in Thousands)	Fair Value Hierarchy Level	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial assets
Cash and due from banks	Level 1	$	523,435	$	523,435	$	507,187	$	507,187
Interest-bearing deposits in other financial institutions	Level 1	236,010		236,010		221,226		221,226
Federal funds sold and securities purchased under agreements to resell	Level 1	100		100		148,285		148,285
Investment securities held to maturity	Level 1	999		1,019		—		—
Investment securities held to maturity	Level 2	2,199,420		2,280,265		2,740,511		2,710,271
Investment securities available for sale	Level 1	—		—		999		999
Investment securities available for sale	Level 2	3,436,289		3,436,289		3,945,943		3,945,943
Equity securities with readily determinable fair values	Level 1	1,652		1,652		1,568		1,568
Equity securities without readily determinable fair values	Level 3	13,444		13,444		—		—
FHLB and Federal Reserve Bank stocks	Level 2	207,443		207,443		250,534		250,534
Residential loans held for sale	Level 2	137,655		137,655		64,321		64,321
Commercial loans held for sale	Level 2	11,597		11,597		14,943		14,943
Loans, net	Level 3	22,540,285		22,422,568		22,702,406		22,317,395
Bank and corporate owned life insurance	Level 2	670,739		670,739		663,203		663,203
Derivatives (other assets)^(a)	Level 2	129,044		129,044		89,052		89,052
Interest rate lock commitments to originate residential mortgage loans held for sale (other assets)	Level 3	2,017		2,017		2,208		2,208
Financial liabilities
Noninterest-bearing demand, savings, interest-bearing demand, and money market accounts	Level 3	$	21,512,804	$	21,512,804	$	22,081,992	$	22,081,992
Brokered CDs and other time deposits^(b)	Level 2	2,909,759		2,910,112		2,815,401		2,815,401
Short-term funding^(c)	Level 2	108,444		108,444		157,074		157,074
Long-term funding	Level 2	796,799		842,196		795,611		826,612
FHLB advances	Level 2	2,877,727		2,938,923		3,574,371		3,565,572
Standby letters of credit^(d)	Level 2	2,715		2,715		2,482		2,482
Derivatives (accrued expenses and other liabilities)^(a)	Level 2	45,180		45,180		87,817		87,817
Forward commitments to sell residential mortgage loans (accrued expenses and other liabilities)	Level 3	590		590		2,072		2,072


	Corporate and Commercial Specialty
	Three Months Ended March 31,
($ in Thousands)	2020		2019
Net interest income	$	113,478	$	124,294
Net intersegment interest income (expense)	(12,336)		(19,927)
Segment net interest income	101,141		104,368
Noninterest income	34,802		27,394
Total revenue	135,943		131,762
Credit provision	13,174		13,833
Noninterest expense	52,598		56,340
Income (loss) before income taxes	70,172		61,589
Income tax expense (benefit)	13,126		11,920
Net income	$	57,046	$	49,669






Allocated goodwill	$	530,144	$	528,832


	Community, Consumer, and Business
	Three Months Ended March 31,
($ in Thousands)	2020		2019
Net interest income	$	74,927	$	79,686
Net intersegment interest income (expense)	18,685		20,747
Segment net interest income	93,612		100,433
Noninterest income	57,650		58,275
Total revenue	151,262		158,708
Credit provision	5,108		4,685
Noninterest expense	116,431		112,917
Income (loss) before income taxes	29,723		41,106
Income tax expense (benefit)	6,242		8,632
Net income	$	23,481	$	32,473






Allocated goodwill	$	661,244	$	640,112


	Risk Management and Shared Services
	Three Months Ended March 31,
($ in Thousands)	2020		2019
Net interest income	$	14,537	$	11,567
Net intersegment interest income (expense)	(6,349)		(821)
Segment net interest income	8,188		10,746
Noninterest income	5,854		5,533
Total revenue	14,042		16,280
Credit provision	34,719		(12,518)
Noninterest expense^(a)	23,162		22,414
Income (loss) before income taxes	(43,838)		6,384
Income tax expense (benefit)	(9,149)		1,840
Net income	$	(34,689)	$	4,543






Allocated goodwill	$	—	$	—


	Corporate and Commercial Specialty													Consolidated Total
	Three Months Ended September 30,						Nine Months Ended September 30,							Three Months Ended March 31,
($ in Thousands)	2019			2018			2019			2018			($ in Thousands)	2020		2019
Net interest income	$	110,929		$	113,298		$	342,486		$	339,718		Net interest income	$	202,942	$	215,547
Net intersegment interest income (expense)	(17,318		)	(13,018		)	(60,000		)	(36,151		)	Net intersegment interest income (expense)	—		—
Segment net interest income	93,612			100,280			282,485			303,567			Segment net interest income	202,942		215,547
Noninterest income	13,452			12,280			39,215			39,156			Noninterest income	98,306		91,202
Total revenue	107,063			112,560			321,700			342,723			Total revenue	301,248		306,749
Credit provision	12,912			11,232			39,713			32,955			Credit provision	53,001		6,000
Noninterest expense	39,172			41,828			117,982			122,853			Noninterest expense	192,191		191,671
Income (loss) before income taxes	54,979			59,500			164,005			186,914			Income (loss) before income taxes	56,056		109,078
Income tax expense (benefit)	9,670			12,098			30,536			36,978			Income tax expense (benefit)	10,219		22,392
Net income	$	45,309		$	47,402		$	133,469		$	149,937		Net income	$	45,838	$	86,686

Allocated goodwill							$	525,836		$	524,525		Allocated goodwill	$	1,191,388	$	1,168,944


($ in Thousands)										($ in Thousands)	Investment Securities Available For Sale		Defined Benefit Pension and Postretirement Obligations		Accumulated Other Comprehensive Income (Loss)
Balance December 31, 2019										Balance December 31, 2019	$	3,989	$	(37,172)	$	(33,183)
Other comprehensive income (loss) before reclassifications										Other comprehensive income (loss) before reclassifications	26,419		—		26,419
Amounts reclassified from accumulated other comprehensive income (loss)										Amounts reclassified from accumulated other comprehensive income (loss)
Investment securities losses (gains), net										Investment securities losses (gains), net	(6,118)		—		(6,118)
Personnel expense										Personnel expense	—		(38)		(38)

Other expense										Other expense	—		808		808

($ in Thousands)	Investment Securities Available For Sale			Defined Benefit Pension and Post Retirement Obligations			Accumulated Other Comprehensive Income (Loss)
Balance January 1, 2019	$	(75,643	)	$	(49,330	)	$	(124,972	)
Interest income										Interest income	556		—		556
Income tax (expense) benefit										Income tax (expense) benefit	(5,225)		(193)		(5,418)
Net other comprehensive income (loss) during period										Net other comprehensive income (loss) during period	15,632		577		16,209
Balance March 31, 2020										Balance March 31, 2020	$	19,620	$	(36,595)	$	(16,974)

Balance December 31, 2018										Balance December 31, 2018	$	(75,643)	$	(49,330)	$	(124,972)
Other comprehensive income (loss) before reclassifications	123,139			—			123,139			Other comprehensive income (loss) before reclassifications	30,490		—		30,490
Amounts reclassified from accumulated other comprehensive income (loss)										Amounts reclassified from accumulated other comprehensive income (loss)
Investment securities losses (gains), net	(5,931		)	—			(5,931		)	Investment securities losses (gains), net	(1,680)		—		(1,680)
Personnel expense	—			(111		)	(111		)	Personnel expense	—		(38)		(38)
Other expense	—			357			357			Other expense	—		64		64
Amortization of net unrealized (gains) losses on available for sale securities transferred to held to maturity securities	279			—			279

Interest income										Interest income	69		—		69
Income tax (expense) benefit	(29,651		)	(62		)	(29,713		)	Income tax (expense) benefit	(7,301)		(7)		(7,308)
Net other comprehensive income (loss) during period	87,836			184			88,020			Net other comprehensive income (loss) during period	21,578		20		21,597
Balance September 30, 2019	$	12,194		$	(49,146	)	$	(36,953	)
Balance March 31, 2019										Balance March 31, 2019	$	(54,065)	$	(49,310)	$	(103,375)

Balance January 1, 2018	$	(38,453	)	$	(24,305	)	$	(62,758	)
Other comprehensive income (loss) before reclassifications	(82,099		)	—			(82,099		)
Amounts reclassified from accumulated other comprehensive income (loss)
Investment securities loss (gain), net	1,985			—			1,985
Personnel expense	—			(112		)	(112		)
Other expense	—			1,480			1,480
Adjustment for adoption of ASU 2016-01	(84		)	—			(84		)
Adjustment for adoption of ASU 2018-02	(8,419		)	(5,235		)	(13,654		)
Amortization of net unrealized (gains) losses on available for sale securities transferred to held to maturity securities	(684		)	—			(684		)
Income tax (expense) benefit	20,796			(390		)	20,406
Net other comprehensive income (loss) during period	(68,505		)	(4,257		)	(72,762		)
Balance September 30, 2018	$	(106,958	)	$	(28,562	)	$	(135,520	)



($ in Thousands)	Investments Securities Available For Sale			Defined Benefit Pension and Post Retirement Obligations			Accumulated Other Comprehensive Income (Loss)
Balance July 1, 2019	$	(9,773	)	$	(49,290	)	$	(59,063	)
Other comprehensive income (loss) before reclassifications	33,173			—			33,173
Amounts reclassified from accumulated other comprehensive income (loss)
Investment securities losses (gains), net	(3,788		)	—			(3,788		)
Personnel expense	—			(36		)	(36		)
Other expense	—			229			229
Amortization of net unrealized (gains) losses on available for sale securities transferred to held to maturity securities	(8		)	—			(8		)
Income tax (expense) benefit	(7,410		)	(49		)	(7,458		)
Net other comprehensive income (loss) during period	21,967			144			22,111
Balance September 30, 2019	$	12,194		$	(49,146	)	$	(36,953	)

Balance July 1, 2018	$	(90,986	)	$	(28,902	)	$	(119,888	)
Other comprehensive income (loss) before reclassifications	(21,345		)	—			(21,345		)
Amounts reclassified from accumulated other comprehensive income (loss)
Investment securities loss (gain), net	(30		)	—			(30		)
Personnel expense	—			(37		)	(37		)
Other expense	—			551			551
Amortization of net unrealized (gains) losses on available for sale securities transferred to held to maturity securities	(52		)	—			(52		)
Income tax (expense) benefit	5,456			(174		)	5,282
Net other comprehensive income (loss) during period	(15,971		)	340			(15,631		)
Balance September 30, 2018	$	(106,958	)	$	(28,562	)	$	(135,520	)



Revenue Stream						Noninterest income in-scope of Topic 606
Insurance commissions and fees						The Corporation's insurance revenue has two distinct performance obligations. The first performance obligation is the selling of the policy as an agent for the carrier. This performance obligation is satisfied upon binding of the policy. The second performance obligation is the ongoing servicing of the policy which is satisfied over the life of the policy. For employee benefits, the payment is typically received monthly. For property and casualty, payments can vary, but are typically received at, or in advance, of the policy period.
Service charges and deposit account fees						Service charges onand deposit ~~accounts~~account fees consist of monthly service fees (i.e. business ~~analysis~~analyzed fees and consumer service charges) and other deposit account related fees. The Corporation's performance obligation for monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Other deposit account related fees are largely transactional based, and therefore, the Corporation's performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges onand deposit ~~accounts is~~account fees are primarily received immediately or in the following month through a direct charge to customers’ accounts.
Card-based fees^(a)						Card-based fees are primarily comprised of debit and credit card income, ATM fees, and merchant services income. Debit and credit card income is primarily comprised of interchange fees earned whenever the Corporation's debit and credit cards are processed through card payment networks. ATM and merchant fees are largely transactional based, and therefore, the Corporation's performance obligation is satisfied, and related revenue recognized, at a point in time. Payment is typically received immediately or in the following month.
Trust and asset management fees^(b)						Trust and asset management income is primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Corporation's performance obligation is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and the applicable fee rate. Payment is generally received a few days after month end through a direct charge to the customers’ accounts. The Corporation's performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered.
Brokerage commissions and fees^(b)						Brokerage commissions and fees primarily consist of investment advisory, brokerage, retirement services, and annuities. The Corporation's performance obligation for investment advisory services and retirement services is generally satisfied, and the related revenue recognized, over the period in which the services are provided. The performance obligation for annuities is satisfied upon sale of the annuity, and therefore, the related revenue is primarily recognized at the time of sale. Payments for these services are typically received immediately or in advance of the service.



($ in Thousands)	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019
Operating Lease Costs	$	2,708	$	8,502
Operating Lease Cash Flows	2,968		8,538



	September 30, 2019
($ in Thousands)	Amount		Consolidated Balance Sheets Category
Operating lease right-of-use asset	$	48,127	Premises and equipment
Finance lease right-of-use asset	—		Other assets
Operating lease liability	52,011		Accrued expenses and other liabilities
Finance lease liability	—		Other long-term funding



	September 30, 2019
($ in Thousands)	Lease payments		Weighted-average lease term (in years)	Weighted-average discount rate
Operating leases
Equipment	$	66	1.08	2.72	%
Retail and corporate offices	54,202		6.63	3.36	%
Land	6,425		12.11	3.34	%
Total operating leases	$	60,693	7.40	3.36	%



($ in Thousands)	Amount
Three Months Ending December 31, 2019	$	4,070
2020	10,520
2021	9,828
2022	7,578
2023	5,450
Beyond 2023	23,248
Total lease payments	60,693
Less: interest	8,682
Present value of lease payments	$	52,011



ITEM 2.			Management's Discussion and Analysis of Financial Condition and Results of Operations


($ in Thousands, except per share data)	1Q20			4Q19			3Q19			2Q19			1Q19
Net income	$	45,838		$	72,103		$	83,339		$	84,661		$	86,686
Net income available to common equity	42,037			68,303			79,539			80,860			82,885
Earnings per common share - basic	0.27			0.43			0.50			0.49			0.50
Earnings per common share - diluted	0.27			0.43			0.49			0.49			0.50
Effective tax rate	18.23		%	19.41		%	20.09		%	18.34		%	20.53		%



($ in Thousands, except per share data)	YTD 2019			YTD 2018			3Q19			2Q19			1Q19			4Q18			3Q18
Net income	$	254,686		$	244,578		$	83,339		$	84,661		$	86,686		$	88,985		$	85,929
Net income available to common equity	243,285			237,501			79,539			80,860			82,885			85,278			83,521
Earnings per common share - basic	1.49			1.40			0.50			0.49			0.50			0.52			0.49
Earnings per common share - diluted	1.48			1.38			0.49			0.49			0.50			0.51			0.48
Effective tax rate	19.67		%	18.34		%	20.09		%	18.34		%	20.53		%	21.83		%	20.64		%



	Three Months Ended
	September 30, 2019						June 30, 2019						September 30, 2018
($ in Thousands)	Average Balance		Interest Income / Expense		Average Yield / Rate		Average Balance		Interest Income / Expense		Average Yield / Rate		Average Balance		Interest Income / Expense		Average Yield / Rate
Assets
Earning assets
Loans^(a)(b)(c)
Commercial and business lending	$	8,502,268	$	96,327	4.49	%	$	8,621,609	$	103,029	4.79	%	$	7,938,739	$	91,250	4.56	%
Commercial real estate lending	5,157,031		64,058		4.92	%	5,130,954		66,522		5.19	%	5,420,680		68,020		4.98	%
Total commercial	13,659,299		160,386		4.66	%	13,752,563		169,551		4.94	%	13,359,419		159,270		4.73	%
Residential mortgage	8,337,230		68,656		3.29	%	8,378,082		72,692		3.47	%	8,333,303		71,926		3.45	%
Retail	1,255,540		20,066		6.38	%	1,223,726		19,095		6.25	%	1,280,996		18,859		5.87	%
Total loans	23,252,068		249,108		4.26	%	23,354,371		261,338		4.48	%	22,973,717		250,055		4.33	%
Investment securities
Taxable	4,032,027		23,485		2.33	%	4,523,260		26,710		2.36	%	5,290,859		29,895		2.26	%
Tax-exempt^(a)	1,918,661		18,114		3.78	%	1,943,485		18,304		3.77	%	1,627,715		14,973		3.68	%
Other short-term investments	619,334		4,865		3.12	%	479,590		3,995		3.34	%	582,578		4,036		2.75	%
Investments and other	6,570,022		46,464		2.81	%	6,946,335		49,009		2.81	%	7,501,152		48,905		2.61	%
Total earning assets	29,822,090		$	295,572	3.94	%	30,300,707		$	310,347	4.10	%	30,474,870		$	298,959	3.91	%
Other assets, net^(d)	3,331,910						3,138,111						3,005,120
Total assets	$	33,154,000					$	33,438,818					$	33,479,990
Liabilities and Stockholders' equity
Interest-bearing liabilities
Interest-bearing deposits
Savings	$	2,618,188	$	2,164	0.33	%	$	2,319,556	$	1,686	0.29	%	$	1,901,960	$	327	0.07	%
Interest-bearing demand	5,452,674		16,055		1.17	%	4,984,511		15,309		1.23	%	4,988,694		13,169		1.05	%
Money market	6,933,230		18,839		1.08	%	7,118,594		20,883		1.18	%	7,546,059		16,212		0.85	%
Network transaction deposits	1,764,961		10,147		2.28	%	2,024,604		12,456		2.47	%	1,969,915		10,027		2.02	%
Time deposits	3,107,670		14,381		1.84	%	3,544,317		16,717		1.89	%	2,978,314		10,382		1.38	%
Total interest-bearing deposits	19,876,723		61,585		1.23	%	19,991,581		67,050		1.35	%	19,384,942		50,116		1.03	%
Federal funds purchased and securities sold under agreements to repurchase	81,285		145		0.71	%	115,694		286		0.99	%	231,308		504		0.86	%
Commercial paper	28,721		33		0.45	%	30,612		37		0.49	%	43,911		38		0.35	%
FHLB advances	2,716,946		15,896		2.32	%	3,171,353		17,744		2.24	%	3,690,687		19,318		2.08	%
Long-term funding	796,561		7,396		3.71	%	796,169		7,396		3.72	%	656,055		6,095		3.72	%
Total short and long-term funding	3,623,513		23,469		2.58	%	4,113,829		25,463		2.48	%	4,621,961		25,956		2.23	%
Total interest-bearing liabilities	23,500,235		$	85,054	1.44	%	24,105,410		$	92,513	1.54	%	24,006,903		$	76,072	1.26	%
Noninterest-bearing demand deposits	5,324,481						5,089,928						5,310,977
Other liabilities^(d)	425,810						390,585						400,570
Stockholders’ equity	3,903,474						3,852,894						3,761,541
Total liabilities and stockholders’ equity	$	33,154,000					$	33,438,818					$	33,479,990
Interest rate spread					2.50	%					2.56	%					2.65	%
Net free funds					0.31	%					0.31	%					0.27	%
Fully tax-equivalent net interest income and net interest margin ("NIM")			$	210,517	2.81	%			$	217,834	2.87	%			$	222,887	2.92	%
Fully tax-equivalent adjustment			4,152						4,215						3,496
Net interest income			$	206,365					$	213,619					$	219,392