Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Jul. 31, 2014 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'EAST WEST BANCORP INC | ' |
Entity Central Index Key | '0001069157 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Jun-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 143,388,292 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
ASSETS | ' | ' |
Cash and cash equivalents | $1,246,044 | $895,820 |
Short-term investments | 286,130 | 257,473 |
Securities purchased under resale agreements | 1,275,000 | 1,300,000 |
Investment securities available-for-sale, at fair value (with amortized cost of $2,534,163 at June 30, 2014 and $2,786,490 in 2013) | 2,529,652 | 2,733,797 |
Loans held for sale | 450,864 | 204,970 |
Loans receivable, excluding covered loans (net of allowance for loan losses of $246,468 in 2014 and $241,930 in 2013) | 18,025,711 | 15,412,715 |
Covered loans (net of allowance for loan losses of $4,880 in 2014 and $7,745 in 2013) | 1,803,090 | 2,187,898 |
Total loans receivable, net | 19,828,801 | 17,600,613 |
FDIC indemnification asset, net | ' | 74,708 |
Other real estate owned, net | 42,458 | 18,900 |
Other real estate owned covered, net | 24,779 | 21,373 |
Total other real estate owned | 67,237 | 40,273 |
Investment in Federal Home Loan Bank stock, at cost | 37,731 | 62,330 |
Investment in Federal Reserve Bank stock, at cost | 54,217 | 48,333 |
Investment in affordable housing partnerships | 181,943 | 164,776 |
Premises and equipment, net | 183,498 | 177,710 |
Accrued interest receivable | 100,323 | 116,314 |
Due from customers on acceptances | 27,237 | 21,236 |
Premiums on deposits acquired, net | 50,389 | 46,920 |
Goodwill | 458,467 | 337,438 |
Cash surrender value of life insurance policies | 99,817 | 112,650 |
Other assets | 679,755 | 534,707 |
TOTAL | 27,557,105 | 24,730,068 |
Customer deposit accounts: | ' | ' |
Noninterest-bearing | 6,889,950 | 5,821,899 |
Interest-bearing | 15,985,139 | 14,591,019 |
Total deposits | 22,875,089 | 20,412,918 |
Federal Home Loan Bank advances | 316,156 | 315,092 |
Securities sold under repurchase agreements | 1,005,211 | 995,000 |
Payable to FDIC, net | 24,337 | -74,708 |
Bank acceptances outstanding | 27,237 | 21,236 |
Long-term debt | 235,732 | 226,868 |
Accrued expenses and other liabilities | 372,319 | 394,729 |
Total liabilities | 24,856,081 | 22,365,843 |
COMMITMENTS AND CONTINGENCIES (Note 12) | ' | ' |
STOCKHOLDERS' EQUITY | ' | ' |
Common stock, $0.001 par value, 200,000,000 shares authorized; 163,488,203 and 163,098,008 shares issued in 2014 and 2013, respectively; 143,389,155 and 137,630,896 shares outstanding in 2014 and 2013, respectively | 163 | 163 |
Additional paid in capital | 1,661,549 | 1,571,670 |
Retained earnings | 1,468,889 | 1,360,130 |
Treasury stock, at cost - 20,099,048 shares in 2014 and 25,467,112 shares in 2013 | -427,042 | -537,279 |
Accumulated other comprehensive loss, net of tax | -2,535 | -30,459 |
Total stockholders' equity | 2,701,024 | 2,364,225 |
TOTAL | $27,557,105 | $24,730,068 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
ASSETS | ' | ' |
Investment securities available-for-sale, amortized cost | $2,534,163 | $2,786,490 |
Loans receivable, excluding covered loans, allowance for loan losses | 246,468 | 241,930 |
Covered loans, allowance for loan losses | $4,880 | $7,745 |
STOCKHOLDERS' EQUITY | ' | ' |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 163,488,203 | 163,098,008 |
Common stock, shares outstanding | 143,389,155 | 137,630,896 |
Treasury stock, shares | 20,099,048 | 25,467,112 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
INTEREST AND DIVIDEND INCOME | ' | ' | ' | ' |
Loans receivable, including fees | $269,484 | $234,290 | $531,055 | $451,449 |
Investment securities | 12,490 | 9,594 | 24,766 | 19,804 |
Securities purchased under resale agreements | 4,559 | 5,435 | 9,412 | 10,964 |
Investment in Federal Home Loan Bank stock | 773 | 1,021 | 1,896 | 1,550 |
Investment in Federal Reserve Bank stock | 782 | 721 | 1,530 | 1,441 |
Due from banks and short-term investments | 6,354 | 4,292 | 11,956 | 8,568 |
Total interest and dividend income | 294,442 | 255,353 | 580,615 | 493,776 |
INTEREST EXPENSE | ' | ' | ' | ' |
Customer deposit accounts | 15,569 | 15,738 | 31,451 | 32,592 |
Federal Home Loan Bank advances | 1,015 | 1,047 | 2,060 | 2,086 |
Securities sold under repurchase agreements | 10,189 | 10,217 | 20,267 | 20,746 |
Long-term debt | 1,219 | 707 | 2,421 | 1,417 |
Total interest expense | 27,992 | 27,709 | 56,199 | 56,841 |
Net interest income before provision for loan losses | 266,450 | 227,644 | 524,416 | 436,935 |
Provision for loan losses, excluding covered loans | 8,944 | 8,277 | 16,898 | 7,515 |
(Reversal of) provision for loan losses on covered loans | -944 | 723 | -1,965 | 5,812 |
Net interest income after provision for loan losses | 258,450 | 218,644 | 509,483 | 423,608 |
NONINTEREST INCOME (LOSS) | ' | ' | ' | ' |
Changes in FDIC indemnification asset and receivable/payable | -57,558 | -47,905 | -111,192 | -79,804 |
Branch fees | 9,519 | 8,119 | 18,965 | 15,773 |
Net gains on sales of investment securities | 671 | 5,345 | 4,089 | 10,922 |
Net gains on sales of fixed assets | 180 | 228 | 360 | 352 |
Letters of credit fees and commissions | 6,099 | 5,426 | 12,266 | 10,488 |
Foreign exchange income | 2,841 | 3,649 | 3,530 | 5,985 |
Ancillary loan fees | 2,521 | 2,634 | 4,993 | 4,686 |
Income from life insurance policies | 881 | 900 | 2,032 | 1,868 |
Net gains (losses) on sales of loans | 6,793 | -354 | 12,989 | -260 |
Other operating income | 13,108 | 9,604 | 22,107 | 15,537 |
Total noninterest loss | -14,945 | -12,354 | -29,861 | -14,453 |
NONINTEREST EXPENSE | ' | ' | ' | ' |
Compensation and employee benefits | 55,081 | 42,026 | 114,358 | 87,757 |
Occupancy and equipment expense | 16,534 | 13,706 | 32,385 | 27,514 |
Amortization of investments in affordable housing partnerships and other investments | 12,851 | 5,064 | 18,815 | 9,347 |
Amortization of premiums on deposits acquired | 2,624 | 2,375 | 5,124 | 4,784 |
Deposit insurance premiums and regulatory assessments | 5,812 | 3,875 | 11,514 | 7,657 |
Loan related (income) expenses | -1,098 | 3,573 | 1,477 | 7,157 |
Other real estate owned expense (gains on sale) | 783 | -1,188 | 2,117 | -2,172 |
Legal expense | 9,104 | 5,467 | 12,903 | 9,911 |
Data processing | 2,940 | 2,200 | 11,140 | 4,637 |
Deposit related expenses | 1,956 | 1,516 | 3,660 | 3,090 |
Consulting expense | 2,328 | 1,003 | 3,377 | 1,457 |
Other operating expenses | 18,984 | 14,803 | 35,456 | 29,636 |
Total noninterest expense | 127,899 | 94,420 | 252,326 | 190,775 |
INCOME BEFORE PROVISION FOR INCOME TAXES | 115,606 | 111,870 | 227,296 | 218,380 |
PROVISION FOR INCOME TAXES | 31,618 | 37,855 | 66,567 | 72,274 |
NET INCOME | 83,988 | 74,015 | 160,729 | 146,106 |
PREFERRED STOCK DIVIDENDS | ' | 1,714 | ' | 3,428 |
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $83,988 | $72,301 | $160,729 | $142,678 |
EARNINGS PER SHARE AVAILABLE TO COMMON STOCKHOLDERS | ' | ' | ' | ' |
BASIC (in dollars per share) | $0.59 | $0.52 | $1.13 | $1.03 |
DILUTED (in dollars per share) | $0.58 | $0.52 | $1.12 | $1.03 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ' | ' | ' | ' |
BASIC (in shares) | 143,187 | 137,536 | 142,578 | 137,592 |
DILUTED (in shares) | 143,689 | 137,816 | 143,158 | 141,573 |
DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share) | $0.18 | $0.15 | $0.36 | $0.30 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 6 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | ||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ' | ' | ' | ' | ||||
Net income | $83,988 | $74,015 | $160,729 | $146,106 | ||||
Unrealized gains on investment securities available-for-sale: | ' | ' | ' | ' | ||||
Net unrealized holding gains (losses) arising during period | 14,895 | -24,770 | 30,317 | -20,029 | ||||
Reclassification adjustment for net gains included in net income | -389 | [1] | -3,100 | [1] | -2,372 | [1] | -6,335 | [1] |
Net unrealized (losses) gains on other investments | -4 | 7 | -21 | 17 | ||||
Other comprehensive income (loss) | 14,502 | -27,863 | 27,924 | -26,347 | ||||
COMPREHENSIVE INCOME | $98,490 | $46,152 | $188,653 | $119,759 | ||||
[1] | The pretax amount is reported in net gains on sales of investment securities in the consolidated statements of operations. |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (USD $) | Total | Additional Paid In Capital Preferred Stock | Common Stock | Additional Paid In Capital Common Stock | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss), Net of Tax |
In Thousands, unless otherwise specified | |||||||
BALANCE at Dec. 31, 2012 | $2,382,122 | $83,027 | $157 | $1,464,739 | $1,151,828 | ($322,298) | $4,669 |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' |
Net income | 146,106 | ' | ' | ' | 146,106 | ' | ' |
Other comprehensive income (loss) | -26,347 | ' | ' | ' | ' | ' | -26,347 |
Stock compensation costs | 5,898 | ' | ' | 5,898 | ' | ' | ' |
Tax benefit from stock compensation plans, net | 2,803 | ' | ' | 2,803 | ' | ' | ' |
Issuance of 390,195 and 245,261 shares of common stock pursuant to various stock compensation plans and agreements for the period ended June 30, 2014 and 2013, respectively | 1,150 | ' | ' | 1,150 | ' | ' | ' |
Cancellation of 12,959 and 44,793 shares of common stock due to forfeitures of issued restricted stock for the period ended June 30, 2014 and 2013, respectively | ' | ' | ' | 804 | ' | -804 | ' |
202,070 and 356,426 shares of restricted stock surrendered due to employee tax liability for the period ended June 30, 2014 and 2013, respectively | -8,667 | ' | ' | ' | ' | -8,667 | ' |
Preferred stock dividends | -3,428 | ' | ' | ' | -3,428 | ' | ' |
Common stock dividends | -41,694 | ' | ' | ' | -41,694 | ' | ' |
Conversion of 85,710 shares of Series A preferred stock into 5,594,080 shares of common stock | ' | -83,027 | 6 | 83,021 | ' | ' | ' |
Purchase of 8,026,807 shares of treasury stock pursuant to the Stock Repurchase Program | -199,992 | ' | ' | ' | ' | -199,992 | ' |
BALANCE at Jun. 30, 2013 | 2,257,951 | ' | 163 | 1,558,415 | 1,252,812 | -531,761 | -21,678 |
BALANCE at Dec. 31, 2013 | 2,364,225 | ' | 163 | 1,571,670 | 1,360,130 | -537,279 | -30,459 |
Increase (Decrease) in Stockholders' Equity | ' | ' | ' | ' | ' | ' | ' |
Net income | 160,729 | ' | ' | ' | 160,729 | ' | ' |
Other comprehensive income (loss) | 27,924 | ' | ' | ' | ' | ' | 27,924 |
Stock compensation costs | 6,745 | ' | ' | 6,745 | ' | ' | ' |
Tax benefit from stock compensation plans, net | 3,787 | ' | ' | 3,787 | ' | ' | ' |
Issuance of 390,195 and 245,261 shares of common stock pursuant to various stock compensation plans and agreements for the period ended June 30, 2014 and 2013, respectively | 1,207 | ' | ' | 1,207 | ' | ' | ' |
Cancellation of 12,959 and 44,793 shares of common stock due to forfeitures of issued restricted stock for the period ended June 30, 2014 and 2013, respectively | ' | ' | ' | 241 | ' | -241 | ' |
202,070 and 356,426 shares of restricted stock surrendered due to employee tax liability for the period ended June 30, 2014 and 2013, respectively | -7,308 | ' | ' | ' | ' | -7,308 | ' |
Common stock dividends | -51,970 | ' | ' | ' | -51,970 | ' | ' |
Issuance of 5,583,093 shares pursuant to MetroCorp acquisition | 190,830 | ' | ' | 73,044 | ' | 117,786 | ' |
Warrant acquired pursuant to MetroCorp acquisition | 4,855 | ' | ' | 4,855 | ' | ' | ' |
BALANCE at Jun. 30, 2014 | $2,701,024 | ' | $163 | $1,661,549 | $1,468,889 | ($427,042) | ($2,535) |
CONSOLIDATED_STATEMENTS_OF_CHA1
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) | 6 Months Ended | |
Jun. 30, 2014 | Jun. 30, 2013 | |
Issuance of shares of common stock pursuant to various stock compensation plans and agreements, shares | 390,195 | 245,261 |
Cancellation of common stock due to forfeitures of issued restricted stock, shares | 12,959 | 44,793 |
Restricted stock surrendered due to employee tax liability, shares | 202,070 | 356,426 |
Purchase of treasury stock pursuant to the Stock Repurchase Program, shares | ' | 8,026,807 |
Issuance of shares pursuant to MetroCorp acquisition, shares | 5,583,093 | ' |
Preferred stock, Series A, non-cumulative convertible | ' | ' |
Conversion of Series A preferred stock, shares | ' | 85,710 |
Converted shares of common stock, shares | ' | 5,594,080 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' |
Net income | $160,729 | $146,106 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 50,135 | 46,785 |
(Accretion) of discount and amortization of premiums, net | -113,327 | -104,247 |
Changes in FDIC indemnification asset and receivable/payable | 111,192 | 79,804 |
Stock compensation costs | 6,745 | 5,898 |
Tax benefit from stock compensation plans, net | -3,787 | -2,803 |
Provision for loan losses | 14,933 | 13,327 |
Impairment on other real estate owned | 539 | 2,153 |
Net gain on sales of investment securities, loans and other assets | -20,941 | -16,512 |
Originations and purchases of loans held for sale | -86,312 | -71,572 |
Proceeds from sales and net change in loans held for sale | 109,241 | 11,155 |
Net proceeds from FDIC shared-loss agreements | 2,367 | 42,494 |
Net change in accrued interest receivable and other assets | -11,754 | 50,275 |
Net change in accrued expenses and other liabilities | -171,084 | -43,579 |
Other net operating activities | -1,165 | -1,548 |
Total adjustments | -113,218 | 11,630 |
Net cash provided by operating activities | 47,511 | 157,736 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' |
Acquisitions, net of cash paid | 138,465 | ' |
Net (increase) decrease in: | ' | ' |
Loans | -1,581,763 | -679,359 |
Short-term investments | -28,657 | 35,940 |
Purchases of: | ' | ' |
Securities purchased under resale agreements | -475,000 | -300,000 |
Investment securities available-for-sale | -250,607 | -699,650 |
Loans receivable | -1,817 | -466,715 |
Premises and equipment | -5,859 | -10,328 |
Investments in affordable housing partnerships and other investments | -43,195 | -16,683 |
Proceeds from sale of: | ' | ' |
Investment securities available-for-sale | 351,842 | 325,721 |
Loans receivable | 149,409 | 55,129 |
Loans held for sale originated for investment | 206,569 | ' |
Other real estate owned | 20,943 | 38,677 |
Repayments, maturities and redemptions of investment securities available-for-sale | 207,746 | 262,074 |
Paydowns, maturities and termination of securities purchased under resale agreements | 500,000 | 300,000 |
Redemption of Federal Home Loan Bank stock | 27,309 | 21,136 |
Surrender of life insurance policies | 49,111 | ' |
Other net investing activities | -5,525 | 244 |
Net cash used in investing activities | -741,029 | -1,133,814 |
Net increase (decrease) in: | ' | ' |
Deposits | 1,143,322 | 972,853 |
Short-term borrowings | ' | -20,000 |
Proceeds from: | ' | ' |
Issuance of common stock pursuant to various stock plans and agreements | 1,207 | 1,150 |
Payment for: | ' | ' |
Termination of securities purchased under resale agreements | -15,000 | ' |
Repayment of FHLB advances | -10,000 | ' |
Repayment of long-term debt | -20,310 | ' |
Repurchase of vested shares due to employee tax liability | -7,308 | -8,667 |
Repurchase of shares of treasury stock pursuant to the Stock Repurchase Plan | ' | -199,992 |
Cash dividends | -51,956 | -44,961 |
Tax benefit from stock compensation plans, net | 3,787 | 2,803 |
Net cash provided by financing activities | 1,043,742 | 703,186 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 350,224 | -272,892 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 895,820 | 1,323,106 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 1,246,044 | 1,050,214 |
Cash paid during the period for: | ' | ' |
Interest | 56,357 | 58,336 |
Income tax payments, net of refunds | 221,355 | 92,096 |
Noncash investing and financing activities: | ' | ' |
Loans transferred to loans held for sale, net | 460,828 | 19,125 |
Transfers to other real estate owned | 38,048 | 29,782 |
Issuance of stock related to acquisition | 190,830 | ' |
Conversion of preferred stock to common stock | ' | 83,027 |
Loans to facilitate sales of other real estate owned | ' | $139 |
BASIS_OF_PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2014 | |
BASIS OF PRESENTATION | ' |
BASIS OF PRESENTATION | ' |
NOTE 1 — BASIS OF PRESENTATION | |
The consolidated financial statements include the accounts of East West Bancorp, Inc. (referred to herein on an unconsolidated basis as “East West” and on a consolidated basis as the “Company”) and its wholly-owned subsidiaries, East West Bank and subsidiaries (“East West Bank” or the “Bank”) and East West Insurance Services, Inc. Intercompany transactions and accounts have been eliminated in consolidation. East West also has six wholly-owned subsidiaries that are statutory business trusts (the “Trusts”), one of which was the result of the acquisition of MetroCorp Bancshares, Inc. during the first quarter of 2014 as discussed in Note 3 to the Company’s consolidated financial statements. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, the Trusts are not consolidated into East West Bancorp, Inc. | |
The interim consolidated financial statements, presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), are unaudited and reflect all adjustments that, in the opinion of management, are necessary for a fair statement of financial condition and results of operations for the interim periods. All adjustments are of a normal and recurring nature. Results for the three and six months ended June 30, 2014 are not necessarily indicative of results that may be expected for any other interim period or for the year as a whole. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted. Events subsequent to the consolidated balance sheet date have been evaluated through the date the financial statements are issued for inclusion in the accompanying financial statements. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s 2013 Annual Report. | |
Certain prior year balances and notes have been reclassified to conform to current year presentation. |
RECENT_ACCOUNTING_STANDARDS
RECENT ACCOUNTING STANDARDS | 6 Months Ended |
Jun. 30, 2014 | |
RECENT ACCOUNTING STANDARDS | ' |
RECENT ACCOUNTING STANDARDS | ' |
NOTE 2 — RECENT ACCOUNTING STANDARDS | |
In January 2014, the FASB issued ASU 2014-01, Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Qualified Affordable Housing Projects. ASU 2014-10 permits reporting entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the amortization in the income statement as a component of income tax expense. ASU 2014-01 is effective for interim and annual periods beginning after December 15, 2014 and if elected, should be applied retrospectively to all periods presented. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. | |
In January 2014, the FASB issued ASU 2014-04, Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. ASU 2014-04 clarifies when an in—substance repossession or foreclosure occurs that would require a transfer of mortgage loans collateralized by residential real estate properties to other real estate owned. The standard permits the use of either a modified retrospective or prospective transition method. ASU 2014-04 is effective for interim and annual periods beginning after December 15, 2014. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material effect on its consolidated financial statements. |
BUSINESS_COMBINATION
BUSINESS COMBINATION | 6 Months Ended |
Jun. 30, 2014 | |
BUSINESS COMBINATION | ' |
BUSINESS COMBINATION | ' |
NOTE 3 — BUSINESS COMBINATION | |
On January 17, 2014, the Company completed the acquisition of MetroCorp Bancshares, Inc. (“MetroCorp”) parent of MetroBank, N.A. and Metro United Bank. MetroCorp, headquartered in Houston, Texas, operated 19 branch locations within Texas and California under its two banks. The Company acquired MetroCorp to further expand its presence, primarily in Texas, within the markets of Houston and Dallas, and in California, within the San Diego market. The purchase consideration was satisfied two thirds in East West Bancorp stock and one third in cash. The fair value of the consideration transferred in the acquisition of MetroCorp was $291.4 million, which consisted of 5,583,093 shares of East West Bancorp common stock fair valued at $190.8 million at the date of acquisition and $89.4 million in cash, $2.4 million of additional cash to MetroCorp stock option holders and a MetroCorp warrant, fair valued at $8.8 million, assumed by the Bank. | |
Goodwill from the acquisition represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired and is not deductible for tax purposes. As a result of the business combination, the Company recorded goodwill of $121.0 million. | |
The total fair value of assets acquired was $1.70 billion, which included $230.3 million in cash and due from banks, $64.3 million in investment securities available for sale, $2.7 million in Federal Home Loan Bank (“FHLB”) stock, $1.19 billion in loans receivable, $8.6 million in fixed assets, $8.6 million in premiums on deposits acquired, $9.4 million in other real estate owned (“OREO”), $30.0 million in bank owned life insurance, $13.0 million in deferred tax assets and $16.7 million in other assets. The total fair value of liabilities acquired was $1.41 billion, which included $1.32 billion in deposits, $10.0 million in FHLB advances, $25.9 million in repurchase agreements, $29.1 million in junior subordinated debt and $22.7 million in other liabilities. The assets and liabilities, both tangible and intangible, were recorded at their estimated fair values as of the January 17, 2014 acquisition date. The assets acquired and liabilities assumed have been accounted for under the acquisition method of accounting. We have included the financial results of the business combinations in the consolidated statement of income beginning on the acquisition date. |
FAIR_VALUE
FAIR VALUE | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
FAIR VALUE | ' | ||||||||||||||||
FAIR VALUE | ' | ||||||||||||||||
NOTE 4 — FAIR VALUE | |||||||||||||||||
Fair value is defined as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various methods including market and income approaches. Based on these approaches, the Company utilizes certain assumptions that market participants would use in pricing the asset or liability. These inputs can be readily observable, market corroborated, or generally unobservable inputs. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on the observability of the inputs used in the valuation techniques, the Company is required to provide the following information according to the fair value hierarchy noted below. The hierarchy is based on the quality and reliability of the information used to determine fair values. The hierarchy gives the highest priority to quoted prices available in active markets and the lowest priority to data lacking transparency. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories: | |||||||||||||||||
· Level 1 — Quoted prices for identical instruments that are highly liquid, observable and actively traded in over-the-counter markets. Level 1 financial instruments typically include U.S. Treasury securities. | |||||||||||||||||
· Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable and can be corroborated by market data. Level 2 financial instruments typically include U.S. government debt and agency mortgage-backed securities, municipal securities, corporate debt securities, single issuer trust preferred securities, foreign exchange options, foreign exchange contracts and interest rate swaps and caps. | |||||||||||||||||
· Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value is not solely based on observable market inputs and requires management judgment or estimation. This category typically includes pooled trust preferred securities, loans with a fair value adjustment, OREO and derivatives payable. | |||||||||||||||||
The Company records investment securities available-for-sale, derivative liabilities, foreign exchange options, interest rate swaps and caps and foreign exchange contracts at fair value on a recurring basis. Certain other assets such as loans with a fair value adjustment, other real estate owned, loans held for sale, goodwill, premiums on acquired deposits and other investments are recorded at fair value on a nonrecurring basis. Nonrecurring fair value measurements typically involve assets that are periodically evaluated for impairment and for which any impairment is recorded in the period in which the remeasurement is performed. | |||||||||||||||||
In determining the appropriate hierarchy levels, the Company performs a detailed analysis of assets and liabilities that are subject to fair value disclosure. The following tables present both financial and nonfinancial assets and liabilities that are measured at fair value on a recurring and nonrecurring basis. These assets and liabilities are reported on the consolidated balance sheets at their fair values as of June 30, 2014 and December 31, 2013. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to their fair value measurement. There were no transfers for assets measured on a recurring basis in and out of Level 1, Level 2 or Level 3 during the first six months of 2014 and 2013. | |||||||||||||||||
Assets (Liabilities) Measured at Fair Value on a Recurring Basis | |||||||||||||||||
as of June 30, 2014 | |||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||
Fair Value | Active Markets | Other | Significant | ||||||||||||||
Measurements | for Identical | Observable | Unobservable | ||||||||||||||
June 30, | Assets | Inputs | Inputs | ||||||||||||||
2014 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment securities available-for-sale: | |||||||||||||||||
U.S. Treasury securities | $ | 449,312 | $ | 449,312 | $ | — | $ | — | |||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 438,599 | — | 438,599 | — | |||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | |||||||||||||||||
Commercial mortgage-backed securities | 111,757 | — | 111,757 | — | |||||||||||||
Residential mortgage-backed securities | 797,966 | — | 797,966 | — | |||||||||||||
Municipal securities | 289,479 | — | 289,479 | — | |||||||||||||
Other residential mortgage-backed securities: | |||||||||||||||||
Investment grade | 57,206 | — | 57,206 | — | |||||||||||||
Other commercial mortgage-backed securities: | |||||||||||||||||
Investment grade | 51,463 | — | 51,463 | — | |||||||||||||
Corporate debt securities: | |||||||||||||||||
Investment grade | 210,870 | — | 210,870 | — | |||||||||||||
Non-investment grade | 16,579 | — | 8,662 | 7,917 | |||||||||||||
Other securities | 106,421 | — | 106,421 | — | |||||||||||||
Total investment securities available-for-sale | $ | 2,529,652 | $ | 449,312 | $ | 2,072,423 | $ | 7,917 | |||||||||
Foreign exchange options | $ | 6,049 | $ | — | $ | 6,049 | $ | — | |||||||||
Interest rate swaps and caps | 30,233 | — | 30,233 | — | |||||||||||||
Foreign exchange contracts | 4,499 | — | 4,499 | — | |||||||||||||
Derivative liabilities | (48,388 | ) | — | (45,026 | ) | (3,362 | ) | ||||||||||
Assets (Liabilities) Measured at Fair Value on a Recurring Basis | |||||||||||||||||
as of December 31, 2013 | |||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||
Fair Value | Active Markets | Other | Significant | ||||||||||||||
Measurements | for Identical | Observable | Unobservable | ||||||||||||||
December 31, | Assets | Inputs | Inputs | ||||||||||||||
2013 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment securities available-for-sale: | |||||||||||||||||
U.S. Treasury securities | $ | 491,632 | $ | 491,632 | $ | — | $ | — | |||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 394,323 | — | 394,323 | — | |||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | |||||||||||||||||
Commercial mortgage-backed securities | 178,870 | — | 178,870 | — | |||||||||||||
Residential mortgage-backed securities | 885,237 | — | 885,237 | — | |||||||||||||
Municipal securities | 280,979 | — | 280,979 | — | |||||||||||||
Other residential mortgage-backed securities: | |||||||||||||||||
Investment grade | 46,327 | — | 46,327 | — | |||||||||||||
Other commercial mortgage-backed securities: | |||||||||||||||||
Investment grade | 51,617 | — | 51,617 | — | |||||||||||||
Corporate debt securities: | |||||||||||||||||
Investment grade | 309,995 | — | 309,995 | — | |||||||||||||
Non-investment grade | 15,101 | — | 8,730 | 6,371 | |||||||||||||
Other securities | 79,716 | — | 79,716 | — | |||||||||||||
Total investment securities available-for-sale | $ | 2,733,797 | $ | 491,632 | $ | 2,235,794 | $ | 6,371 | |||||||||
Foreign exchange options | $ | 6,290 | $ | — | $ | 6,290 | $ | — | |||||||||
Interest rate swaps and caps | 28,078 | — | 28,078 | — | |||||||||||||
Foreign exchange contracts | 6,181 | — | 6,181 | — | |||||||||||||
Derivative liabilities | (50,262 | ) | — | (46,607 | ) | (3,655 | ) | ||||||||||
Assets measured at fair value on a nonrecurring basis using significant unobservable inputs include certain loans and OREO. The inputs and assumptions for nonrecurring Level 3 fair value measurements for certain loans and OREO include adjustments to external and internal appraisals for changes in the market, assumptions by appraiser embedded into appraisals, probability weighting of broker price opinions, and management’s adjustments for other relevant factors and market trends. | |||||||||||||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Three Months Ended June 30, 2014 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Three Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2014 | (Level 1) | (Level 2) | (Level 3) | 2014 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 17,908 | $ | — | $ | — | $ | 17,908 | $ | 413 | |||||||
Total commercial real estate | 22,758 | — | — | 22,758 | 1,865 | ||||||||||||
Total commercial and industrial | 9,837 | — | — | 9,837 | (9,642 | ) | |||||||||||
Total consumer | — | — | — | — | — | ||||||||||||
Total non-covered loans | $ | 50,503 | $ | — | $ | — | $ | 50,503 | $ | (7,364 | ) | ||||||
Non-covered OREO | $ | 676 | $ | — | $ | — | $ | 676 | $ | — | |||||||
Covered OREO (1) | $ | 4,009 | $ | — | $ | — | $ | 4,009 | $ | (69 | ) | ||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Three Months Ended June 30, 2013 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Three Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2013 | (Level 1) | (Level 2) | (Level 3) | 2013 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 22,012 | $ | — | $ | — | $ | 22,012 | $ | (838 | ) | ||||||
Total commercial real estate | 35,349 | — | — | 35,349 | (1,320 | ) | |||||||||||
Total commercial and industrial | 9,203 | — | — | 9,203 | 674 | ||||||||||||
Total consumer | 372 | — | — | 372 | 4 | ||||||||||||
Total non-covered loans | $ | 66,936 | $ | — | $ | — | $ | 66,936 | $ | (1,480 | ) | ||||||
Non-covered OREO | $ | 435 | $ | — | $ | — | $ | 435 | $ | (18 | ) | ||||||
Covered OREO (1) | $ | 7,500 | $ | — | $ | — | $ | 7,500 | $ | (1,000 | ) | ||||||
(1) Covered OREO results from the WFIB and UCB FDIC-assisted acquisitions for which the Company entered into shared-loss agreements with the FDIC whereby the FDIC will reimburse the Company for 80% of eligible losses. As such, the Company’s liability for losses is 20% of the $69 thousand in losses, or $14 thousand, and 20% of the $1.0 million in losses, or $200 thousand, for the three months ended June 30, 2014 and 2013, respectively. | |||||||||||||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Six Months Ended June 30, 2014 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Six Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2014 | (Level 1) | (Level 2) | (Level 3) | 2014 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 9,800 | $ | — | $ | — | $ | 9,800 | $ | 27 | |||||||
Total commercial real estate | 22,333 | — | — | 22,333 | 1,376 | ||||||||||||
Total commercial and industrial | 8,941 | — | — | 8,941 | (11,705 | ) | |||||||||||
Total consumer | — | — | — | — | — | ||||||||||||
Total non-covered loans | $ | 41,074 | $ | — | $ | — | $ | 41,074 | $ | (10,302 | ) | ||||||
Non-covered OREO | $ | 676 | $ | — | $ | — | $ | 676 | $ | (74 | ) | ||||||
Covered OREO (1) | $ | 4,009 | $ | — | $ | — | $ | 4,009 | $ | (521 | ) | ||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Six Months Ended June 30, 2013 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Six Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2013 | (Level 1) | (Level 2) | (Level 3) | 2013 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 19,971 | $ | — | $ | — | $ | 19,971 | $ | (1,274 | ) | ||||||
Total commercial real estate | 30,397 | — | — | 30,397 | (3,422 | ) | |||||||||||
Total commercial and industrial | 9,723 | — | — | 9,723 | (1,492 | ) | |||||||||||
Total consumer | 293 | — | — | 293 | (112 | ) | |||||||||||
Total non-covered loans | $ | 60,384 | $ | — | $ | — | $ | 60,384 | $ | (6,300 | ) | ||||||
Non-covered OREO | $ | 13,238 | $ | — | $ | — | $ | 13,238 | $ | (1,403 | ) | ||||||
Covered OREO (1) | $ | 11,030 | $ | — | $ | — | $ | 11,030 | $ | (1,126 | ) | ||||||
(1) Covered OREO results from the WFIB and UCB FDIC-assisted acquisitions for which the Company entered into shared-loss agreements with the FDIC whereby the FDIC will reimburse the Company for 80% of eligible losses. As such, the Company’s liability for losses is 20% of the $521 thousand in losses, or $104 thousand, and 20% of the $1.1 million in losses, or $225 thousand, for the six months ended June 30, 2014 and 2013, respectively | |||||||||||||||||
At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The following tables provide a reconciliation of the beginning and ending balances for major asset and liability categories measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2014 and 2013: | |||||||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Opening balance, April 1, 2014 | $ | 6,717 | $ | (3,398 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | 36 | |||||||||||||||
Included in other comprehensive income (unrealized) (2) | 1,209 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (9 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2014 | $ | 7,917 | $ | (3,362 | ) | ||||||||||||
Changes in unrealized gains included in earnings relating to assets and liabilities held at the end of June 30, 2014 | $ | — | $ | (36 | ) | ||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Opening balance, April 1, 2013 | $ | 5,284 | $ | (3,233 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | (24 | ) | ||||||||||||||
Included in other comprehensive income (unrealized) (2) | 239 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (6 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2013 | $ | 5,517 | $ | (3,257 | ) | ||||||||||||
Changes in unrealized losses included in earnings relating to assets and liabilities held at the end of June 30, 2013 | $ | — | $ | 24 | |||||||||||||
(1) Total gains or losses represent the total realized and unrealized gains and losses recorded for Level 3 assets and liabilities. Realized gains or losses are reported in the consolidated statements of income. | |||||||||||||||||
(2) Unrealized gains or losses on investment securities are reported in accumulated other comprehensive income (loss), net of tax, in the consolidated statements of comprehensive income. | |||||||||||||||||
(3) Purchases, issuances, sales, and settlements represent Level 3 assets and liabilities that were either purchased, issued, sold, or settled during the period. The amounts are recorded at their end of period fair values. | |||||||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Beginning balance, January 1, 2014 | $ | 6,371 | $ | (3,655 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | 293 | |||||||||||||||
Included in other comprehensive income (unrealized) (2) | 1,643 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (97 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2014 | $ | 7,917 | $ | (3,362 | ) | ||||||||||||
Changes in unrealized gains included in earnings relating to assets and liabilities held at the end of June 30, 2014 | $ | — | $ | (293 | ) | ||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Beginning balance, January 1, 2013 | $ | 4,800 | $ | (3,052 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | (205 | ) | ||||||||||||||
Included in other comprehensive income (unrealized) (2) | 788 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (71 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2013 | $ | 5,517 | $ | (3,257 | ) | ||||||||||||
Changes in unrealized losses included in earnings relating to assets and liabilities held at the end of June 30, 2013 | $ | — | $ | 205 | |||||||||||||
(1) Total gains or losses represent the total realized and unrealized gains and losses recorded for Level 3 assets and liabilities. Realized gains or losses are reported in the consolidated statements of income. | |||||||||||||||||
(2) Unrealized gains or losses on investment securities are reported in accumulated other comprehensive income (loss), net of tax, in the consolidated statements of comprehensive income. | |||||||||||||||||
(3) Purchases, issuances, sales, and settlements represent Level 3 assets and liabilities that were either purchased, issued, sold, or settled during the period. The amounts are recorded at their end of period fair values. | |||||||||||||||||
Valuation Methodologies | |||||||||||||||||
Investment Securities Available-for-Sale — The fair values of the investment securities are generally determined by independent external pricing service providers who have experience in valuing these securities and by comparison to and/or average of quoted market prices obtained from independent external brokers. In obtaining such valuation information from third parties, the Company has reviewed the methodologies used to develop the resulting fair values. | |||||||||||||||||
The Company’s Level 3 available-for-sale securities include four pooled trust preferred securities. The fair values of these investment securities represent less than 1% of the total available-for-sale investment securities. The fair values of the pooled trust preferred securities have traditionally been based on the average of at least two quoted market prices obtained from independent external brokers since broker quotes in an active market are given the highest priority. As a result of the continued illiquidity in the pooled trust preferred securities market, it is the Company’s view that current broker prices (which are typically non-binding) on certain pooled trust preferred securities are not representative of the fair value of these securities. As such, the Company considered what weight, if any, to place on transactions that are not orderly when estimating fair value. | |||||||||||||||||
For the pooled trust preferred securities, the fair value was derived based on discounted cash flow analyses (the income method) prepared by management. In order to determine the appropriate discount rate used in calculating fair values derived from the income method for the pooled trust preferred securities, the Company has made assumptions using an exit price approach related to the implied rate of return which have been adjusted for general changes in market rates, estimated changes in credit risk and liquidity risk premium, specific nonperformance, and default experience in the collateral underlying the securities. Significant increases (decreases) in any of those inputs in isolation would result in a significantly lower (higher) fair value measurement. Generally, a change in the assumption used for the probability of default is accompanied by a directionally similar change in the assumption used for credit risk and liquidity risk. The actual Level 3 unobservable assumption rates used as of June 30, 2014 include: a constant prepayment rate of 0% for year 1-5 and 1% thereafter, a constant default rate of 1.2% for year 1-5 and 0.75% thereafter, and a recovery assumption of 0% for existing deferrals/defaults and 15% for future deferrals with a recovery lag of 60 months. Losses arising during the period from other-than-temporary-impairment (“OTTI”), if any, are recognized in noninterest income. There were no OTTI on pooled trust preferred securities, for the three and six months ended June 30, 2014 and 2013. | |||||||||||||||||
Derivative Liabilities — The Company’s derivative liabilities include derivatives payable that fall within Level 3 and all other derivative liabilities which fall within Level 2. The derivatives payable are recorded in conjunction with certain certificates of deposit (“host instrument”). These CDs pay interest based on changes in the Chinese currency Renminbi (“RMB”), and are included in interest-bearing deposits on the consolidated balance sheets. The fair value of these embedded derivatives is based on discounted cash flow approach. The payable is divided by the portion under FDIC insurance coverage and the non-insured portion. For the FDIC insured portion the Company applied a risk premium comparable to an agency security risk premium. For the non-insured portion, the Company considered its own credit risk in determining the valuation by applying a risk premium based on our institutional credit rating. Total credit valuation adjustments on derivative liabilities were $933 thousand for the six months ended June 30, 2014. Increases (decreases), if any, of those inputs in isolation would result in a lower (higher) fair value measurement. The valuation of the derivatives payable falls within Level 3 of the fair value hierarchy since the significant inputs used in deriving the fair value of these derivative contracts are not directly observable. The actual Level 3 unobservable input used as of June 30, 2014 was a credit risk adjustment with a range of 0.68% to 0.71%. The Level 2 derivative liabilities are mostly comprised of the offsetting interest rate swaps and caps with other counterparties. Refer to “Interest Rate Swaps and Caps” within this footnote for complete discussion. | |||||||||||||||||
Foreign Exchange Options — The Company entered into foreign exchange option contracts with major investment firms. The settlement amount is determined based upon the performance of the Chinese currency RMB relative to the U.S. Dollar (“USD”) over the 5-year term of the contract. The performance amount is computed based on the average quarterly value of the RMB compared to the USD as compared to the initial value. The fair value of the derivative contract is provided by third parties and is determined based on the change in the RMB and the volatility of the option over the life of the agreement. The option value is derived based on the volatility of the option, interest rate, currency rate and time remaining to maturity. The Company’s consideration of the counterparty’s credit risk resulted in a nominal adjustment to the valuation of the foreign exchange options for the six months ended June 30, 2014. The valuation of the option contract falls within Level 2 of the fair value hierarchy due to the observable nature of the inputs used in deriving the fair value of this derivative contract. | |||||||||||||||||
Interest Rate Swaps and Caps — The Company entered into interest rate swap and cap contracts with institutional counterparties to hedge against interest rate swap and cap products offered to bank customers. This product allows borrowers to lock in attractive intermediate and long-term interest rates by entering into an interest rate swap or cap contract with the Company, resulting in the customer obtaining a synthetic fixed rate loan. The Company has also entered interest rate swap contracts with institutional counterparties to hedge against certificates of deposit issued. This product allows the Company to lock in attractive floating rate funding. The fair value of the interest rate swap contracts is based on a discounted cash flow approach. The counterparty’s credit risk is considered in the valuation of the interest rate swaps as of June 30, 2014. The valuation of the interest rate swaps and caps falls within Level 2 of the fair value hierarchy due to the observable nature of the inputs used in deriving the fair value of this derivative contract. | |||||||||||||||||
Foreign Exchange Contracts — The Company entered into short-term foreign exchange contracts to purchase/sell foreign currencies at set rates in the future. These contracts economically hedge against foreign exchange rate fluctuations. The Company enters into contracts with institutional counterparties to hedge against foreign exchange products offered to bank customers. These products allow customers to hedge the foreign exchange risk of their deposits and loans denominated in foreign currencies. The Company assumes minimal foreign exchange rate risk as the contract with the customer and the contract with the institutional party mirror each other. The fair value is determined at each reporting period based on the change in the foreign exchange rate. Given the short-term nature of the contracts, the counterparties’ credit risks are considered nominal and resulted in no adjustments to the valuation of the short-term foreign exchange contracts for the six months ended June 30, 2014. The valuation of the contract falls within Level 2 of the fair value hierarchy due to the observable nature of the inputs used in deriving the fair value of this derivative contract. | |||||||||||||||||
The Company also entered into long-term foreign exchange contracts to purchase/sell foreign currencies at set rates in the future. The fair value is determined at each reporting period based on the change in the foreign exchange rate. The Company’s consideration of the counterparty’s credit risk resulted in a nominal adjustment to the valuation of the long-term foreign exchange contract for the six months ended June 30, 2014. The valuation of the contract falls within Level 2 of the fair value hierarchy due to the observable nature of the inputs used in deriving the fair value of this derivative contract. | |||||||||||||||||
Loans — The Company evaluates loan impairment according to the provisions of ASC 310-10-35, Receivables-Overall-Subsequent Measurement, for all portfolios other than the homogenous consumer portfolio. Under ASC 310-10-35, loans are considered impaired when it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement, including scheduled interest payments. Impaired loans are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or, as an expedient, at the loan’s observable market price or the fair value of the collateral if the loan is collateral dependent, less costs to sell. If the present value or the value of the collateral is less than the recorded investment of the loan and the loan is classified as nonperforming and uncollectible, the deficiency is charged-off against the allowance for loan losses. Loans that are considered impaired are specifically excluded from the quarterly migration analysis when determining the amount of the general valuation allowance for loan losses required for the period. | |||||||||||||||||
The Company’s impaired loans are generally measured using the fair value of the underlying collateral, which is determined based on the most recent valuation information received. Appraisals are obtained from third party appraisers and reviewed by management. Evaluations are obtained from third-parties or prepared internally and are also reviewed by management. Similarly, updated appraisals and evaluations are obtained on a regular basis or as necessary. Further, on a quarterly basis, all appraisals and evaluations of nonperforming assets are reviewed to assess the current carrying value and to ensure that the current carrying value is appropriate. In calculating the discount to be applied to an appraisal or evaluation, if necessary, the Company considers the location of collateral, the property type, and third party comparable sales. If it is assessed by management that the current value is not appropriate, adjustments to the carrying value will be calculated and a charge-off or a specific valuation allowance may be recorded to reduce the loan to the appropriate adjusted carrying value. The fair values may be adjusted as needed based on factors such as the Company’s historical knowledge and changes in market conditions from the time of valuation. Impaired loans and consumer homogenous loans with fair value adjustments are classified as Level 3 assets in the fair value hierarchy. | |||||||||||||||||
Other Real Estate Owned — The Company’s OREO represents properties acquired through foreclosure or through full or partial satisfaction of loans receivable, which are recorded at estimated fair value less cost to sell at the time of foreclosure and at the lower of cost or estimated fair value less cost to sell subsequent to acquisition. The fair values of OREO properties are based on third party appraisals, broker price opinions or accepted written offers. These valuations are reviewed and approved by the Company’s appraisal department, credit review department, or OREO department. Updated appraisals and evaluations are obtained on a regular basis or at least annually. Further, on a quarterly basis, all appraisals and evaluations of nonperforming assets are reviewed to assess the current carrying value and to ensure that the current carrying value is appropriate. In calculating the discount to be applied to an appraisal or evaluation, if necessary, the Company considers the location of collateral, the property type, and third party comparable sales. If it is assessed by management that the current value is not appropriate, adjustments to the carrying value will be calculated and a charge-off may be taken to reduce the OREO to the appropriate adjusted carrying value. The fair values may be adjusted as needed based on factors such as the Company’s historical knowledge and changes in market conditions from the time of valuation. OREO properties are classified as Level 3 assets in the fair value hierarchy. | |||||||||||||||||
Loans Held for Sale — The Company’s loans held for sale are carried at the lower of cost or market value. These loans are mainly comprised of student loans as of June 30, 2014. Loans held for sale as of December 31, 2013 are comprised of student loans. The fair value of loans held for sale is derived from current market prices and comparative current sales. As such, the Company records any fair value adjustments on a nonrecurring basis. Loans held for sale are classified as Level 2 assets in the fair value hierarchy. | |||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||
The carrying amounts and fair values of the Company’s financial instruments as of June 30, 2014 and December 31, 2013 were as follows: | |||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Carrying | Estimated | Carrying | Estimated | ||||||||||||||
Amount | Fair Value | Amount | Fair Value | ||||||||||||||
(In thousands) | |||||||||||||||||
Financial Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 1,246,044 | $ | 1,246,044 | $ | 895,820 | $ | 895,820 | |||||||||
Short-term investments | 286,130 | 286,130 | 257,473 | 257,473 | |||||||||||||
Securities purchased under resale agreements | 1,275,000 | 1,266,730 | 1,300,000 | 1,279,406 | |||||||||||||
Investment securities available-for-sale | 2,529,652 | 2,529,652 | 2,733,797 | 2,733,797 | |||||||||||||
Loans held for sale | 450,864 | 462,397 | 204,970 | 212,469 | |||||||||||||
Loans receivable, net | 19,828,801 | 19,211,124 | 17,600,613 | 16,741,674 | |||||||||||||
Investment in Federal Home Loan Bank stock | 37,731 | 37,731 | 62,330 | 62,330 | |||||||||||||
Investment in Federal Reserve Bank stock | 54,217 | 54,217 | 48,333 | 48,333 | |||||||||||||
Accrued interest receivable | 100,323 | 100,323 | 116,314 | 116,314 | |||||||||||||
Foreign exchange options | 6,049 | 6,049 | 6,290 | 6,290 | |||||||||||||
Interest rate swaps and caps | 30,233 | 30,233 | 28,078 | 28,078 | |||||||||||||
Foreign exchange contracts | 4,499 | 4,499 | 6,181 | 6,181 | |||||||||||||
Financial Liabilities: | |||||||||||||||||
Customer deposit accounts: | |||||||||||||||||
Demand, savings and money market deposits | 16,643,474 | 16,643,474 | 14,588,570 | 14,588,570 | |||||||||||||
Time deposits | 6,231,615 | 6,212,638 | 5,824,348 | 5,791,659 | |||||||||||||
Federal Home Loan Bank advances | 316,156 | 337,621 | 315,092 | 308,521 | |||||||||||||
Securities sold under repurchase agreements | 1,005,211 | 1,128,491 | 995,000 | 1,134,774 | |||||||||||||
Accrued interest payable | 11,020 | 11,020 | 11,178 | 11,178 | |||||||||||||
Long-term debt | 235,732 | 204,101 | 226,868 | 184,415 | |||||||||||||
Derivative liabilities | 48,388 | 48,388 | 50,262 | 50,262 | |||||||||||||
The following tables show the level in the fair value hierarchy for the estimated fair values of financial instruments that are not already on the consolidated balance sheets at fair value at June 30, 2014 and December 31, 2013: | |||||||||||||||||
June 30, 2014 | |||||||||||||||||
Estimated | |||||||||||||||||
Fair Value | |||||||||||||||||
Measurements | Level 1 | Level 2 | Level 3 | ||||||||||||||
(In thousands) | |||||||||||||||||
Financial Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 1,246,044 | $ | 1,246,044 | $ | — | $ | — | |||||||||
Short-term investments | 286,130 | — | 286,130 | — | |||||||||||||
Securities purchased under resale agreements | 1,266,730 | — | 1,266,730 | — | |||||||||||||
Loans held for sale | 462,397 | — | 462,397 | — | |||||||||||||
Loans receivable, net | 19,211,124 | — | — | 19,211,124 | |||||||||||||
Investment in Federal Home Loan Bank stock | 37,731 | — | 37,731 | — | |||||||||||||
Investment in Federal Reserve Bank stock | 54,217 | — | 54,217 | — | |||||||||||||
Accrued interest receivable | 100,323 | — | 100,323 | — | |||||||||||||
Financial Liabilities: | |||||||||||||||||
Customer deposit accounts: | |||||||||||||||||
Demand, savings and money market deposits | 16,643,474 | — | 16,643,474 | — | |||||||||||||
Time deposits | 6,212,638 | — | — | 6,212,638 | |||||||||||||
Federal Home Loan Bank advances | 337,621 | — | 337,621 | — | |||||||||||||
Securities sold under repurchase agreements | 1,128,491 | — | 1,128,491 | — | |||||||||||||
Accrued interest payable | 11,020 | — | 11,020 | — | |||||||||||||
Long-term debt | 204,101 | — | 204,101 | — | |||||||||||||
December 31, 2013 | |||||||||||||||||
Estimated | |||||||||||||||||
Fair Value | |||||||||||||||||
Measurements | Level 1 | Level 2 | Level 3 | ||||||||||||||
(In thousands) | |||||||||||||||||
Financial Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 895,820 | $ | 895,820 | $ | — | $ | — | |||||||||
Short-term investments | 257,473 | — | 257,473 | — | |||||||||||||
Securities purchased under resale agreements | 1,279,406 | — | 1,279,406 | — | |||||||||||||
Loans held for sale | 212,469 | — | 212,469 | — | |||||||||||||
Loans receivable, net | 16,741,674 | — | — | 16,741,674 | |||||||||||||
Investment in Federal Home Loan Bank stock | 62,330 | — | 62,330 | — | |||||||||||||
Investment in Federal Reserve Bank stock | 48,333 | — | 48,333 | — | |||||||||||||
Accrued interest receivable | 116,314 | — | 116,314 | — | |||||||||||||
Financial Liabilities: | |||||||||||||||||
Customer deposit accounts: | |||||||||||||||||
Demand, savings and money market deposits | 14,588,570 | — | 14,588,570 | — | |||||||||||||
Time deposits | 5,791,659 | — | — | 5,791,659 | |||||||||||||
Federal Home Loan Bank advances | 308,521 | — | 308,521 | — | |||||||||||||
Securities sold under repurchase agreements | 1,134,774 | — | 1,134,774 | — | |||||||||||||
Accrued interest payable | 11,178 | — | 11,178 | — | |||||||||||||
Long-term debt | 184,415 | — | 184,415 | — | |||||||||||||
The methods and assumptions used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value are explained below: | |||||||||||||||||
Cash and Cash Equivalents — The carrying amounts approximate fair values due to the short-term nature of these instruments. Due to the short-term nature, the estimated fair value is considered to be within Level 1 of the fair value hierarchy. | |||||||||||||||||
Short-Term Investments — The fair values of short-term investments generally approximate their book values due to their short maturities. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Securities Purchased Under Resale Agreements — Securities purchased under resale agreements with original maturities of 90 days or less are included in cash and cash equivalents. The fair value of securities purchased under resale agreements with original maturities of more than 90 days is estimated by discounting the cash flows based on expected maturities or repricing dates utilizing estimated market discount rates. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Investment Securities Available-for-Sale — The fair values of the investment securities are generally determined by independent external pricing service providers who have experience in valuing these securities and by comparison to and/or average of quoted market prices obtained from independent external brokers. In obtaining such valuation information from third parties, the Company has reviewed the methodologies used to develop the resulting fair values. For pooled trust preferred securities, fair values are based on discounted cash flow analyses. Due to the unobservable inputs used within the discounted cash flow analysis, the estimate for pooled trust preferred securities is considered to be within Level 3 of the fair value hierarchy. The remainder of the portfolio is classified within Level 1 and Level 2, as discussed earlier in this footnote. | |||||||||||||||||
Loans Held for Sale — The fair value of loans held for sale is derived from current market prices and comparative current sales. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Loans Receivable, net (includes covered and non-covered loans) — The fair value of loans is determined based on a discounted cash flow approach considered for an entry price value. The discount rate is derived from the associated yield curve plus spreads, and reflects the offering rates in the market for loans with similar financial characteristics. No adjustments have been made for changes in credit within any of the loan portfolios. It is management’s opinion that the allowance for loan losses pertaining to performing and nonperforming loans results in a fair valuation of credit for such loans. Due to the unobservable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 3 of the fair value hierarchy. | |||||||||||||||||
Investment in Federal Home Loan Bank Stock and Federal Reserve Bank Stock — The carrying amount approximates fair value, as the stock may be sold back to the Federal Home Loan Bank and the Federal Reserve Bank at carrying value. The valuation of these investments is considered to be within Level 2 of the fair value hierarchy, as the restrictions and value of the investments are the same for all financial institutions which are required to hold these investments. | |||||||||||||||||
Accrued Interest Receivable — The carrying amounts approximate fair values due to the short-term nature of these instruments. Due to the observable nature of the inputs used in deriving the estimated fair value, these instruments are considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Foreign Exchange Options — The fair value of the derivative contracts is provided by third parties and is determined based on the change in the RMB and the volatility of the option over the life of the agreement. The option value is derived based on the volatility of the option, interest rate, and time remaining to maturity. We also consider the counterparty’s credit risk in determining the fair value. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Interest Rate Swaps and Caps — The fair value of the interest rate swap and cap contracts is provided by a third party and is determined based on a discounted cash flow approach. The Company also considered the counterparty’s credit risk in determining the fair value. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Foreign Exchange Contracts — The fair value of foreign exchange contracts is determined based on the change in foreign exchange rate. We also consider the counterparty’s credit risk in determining the fair value. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Customer Deposit Accounts — The carrying amounts approximate fair value for demand and interest checking deposits, savings deposits, and certain money market accounts as the amounts are payable on demand at the reporting date. Due to the observable nature of the inputs used in deriving the estimated fair value, these instruments are considered to be within Level 2 of the fair value hierarchy. For time deposits, the cash flows are based on the contractual runoff and are discounted by the Bank’s current offering rates plus spread. Due to the unobservable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 3 of the fair value hierarchy. | |||||||||||||||||
Federal Home Loan Bank Advances — The fair value of FHLB advances was estimated based on the discounted value of contractual cash flows, using rates currently offered by the FHLB of San Francisco for advances with similar remaining maturities at each reporting date. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Securities Sold Under Repurchase Agreements — For securities sold under repurchase agreements with original maturities of 90 days or less, the carrying amounts approximate fair values due to the short-term nature of these instruments. At June 30, 2014 and December 31, 2013, most of the securities sold under repurchase agreements are long-term in nature and the fair values of securities sold under repurchase agreements are calculated by discounting future cash flows based on expected maturities or repricing dates, utilizing estimated market discount rates, and taking into consideration the call features of each instrument. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Accrued Interest Payable — The carrying amounts approximate fair values due to the short-term nature of these instruments. Due to the observable nature of the inputs used in deriving the estimated fair value, these instruments are considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Long-Term Debt — The fair values of long-term debt are estimated by discounting the cash flows through maturity based on current market rates the Bank would pay for new issuances. Due to the observable nature of the inputs used in deriving the estimated fair value of these instruments, the estimate is considered to be within Level 2 of the fair value hierarchy. | |||||||||||||||||
Derivative Liabilities — The Company’s derivative liabilities include “derivatives payable” and all other derivative liabilities. The Company’s derivatives payable are recorded in conjunction with certain certificates of deposit (“host instrument”). These CDs pay interest based on changes in RMB, as designated. The fair value of derivatives payable is estimated using the discounted cash flow approach. Additionally, we considered our own credit risk in determining the valuation. The other derivative liabilities are mostly comprised of the off-setting interest rate swaps and caps. The fair value of the interest rate swap and cap contracts is provided by a third party and is determined based on a discounted cash flow approach. The Company also considered the counterparty’s credit risk in determining the fair value. Due to the observable nature of the inputs used in deriving the estimated fair value of the interest rate swaps and caps within derivative liabilities, the estimate is considered to be within Level 2 of the fair value hierarchy. Due to the unobservable nature of the inputs used in deriving the estimated fair value of derivatives payable within derivative liabilities, this estimate is considered to be within Level 3 of the fair value hierarchy. | |||||||||||||||||
The fair value estimates presented herein are based on pertinent information available to management as of each reporting date. Although we are not aware of any factors that would significantly affect the estimated fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since that date, and therefore, current estimates of fair value may differ significantly from the amounts presented herein. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
STOCK-BASED COMPENSATION | ' | |||||||||||||
STOCK-BASED COMPENSATION | ' | |||||||||||||
NOTE 5 — STOCK-BASED COMPENSATION | ||||||||||||||
During the three and six months ended June 30, 2014, total compensation expense recognized in the consolidated statements of income related to restricted stock awards reduced income before taxes by $3.6 million and $6.7 million, respectively, and net income by $2.1 million and $3.9 million, respectively. | ||||||||||||||
In comparison, during the three and six months ended June 30, 2013, total compensation expense recognized in the consolidated statements of income related to both stock options and restricted stock awards reduced income before taxes by $3.4 million and $5.9 million, respectively, and net income by $2.0 million and $3.4 million, respectively. | ||||||||||||||
The Company received $283 thousand and $537 thousand during the six months ended June 30, 2014 and 2013, respectively, in cash proceeds from stock option exercises. The net tax benefit recognized in equity for stock compensation plans was $3.8 million and $2.8 million for the six months ended, June 30, 2014 and 2013, respectively. | ||||||||||||||
As of June 30, 2014, there are 3,723,456 shares available to be issued, subject to the Company’s current 1998 Stock Incentive Plan, as amended. | ||||||||||||||
Stock Options | ||||||||||||||
The Company issues fixed stock options to certain employees, officers, and directors. Stock options are issued at the current market price on the date of grant with a three-year or four-year vesting period and contractual terms of 7 or 10 years. The Company issues new shares upon the exercise of stock options. | ||||||||||||||
A summary of activity for the Company’s stock options as of and for the six months ended June 30, 2014 is presented below: | ||||||||||||||
Weighted | ||||||||||||||
Weighted | Average | Aggregate | ||||||||||||
Average | Remaining | Intrinsic | ||||||||||||
Exercise | Contractual | Value | ||||||||||||
Shares | Price | Term | (In thousands) | |||||||||||
Outstanding at beginning of period | 406,731 | $ | 26.72 | |||||||||||
Granted | — | — | ||||||||||||
Exercised | (13,415 | ) | 21.09 | |||||||||||
Expired | (130,514 | ) | 38.76 | |||||||||||
Outstanding at end of period | 262,802 | $ | 21.03 | 0.65 years | $ | 3,667 | ||||||||
Vested or expected to vest at end of period | 262,802 | $ | 21.03 | 0.65 years | $ | 3,667 | ||||||||
Exercisable at end of period | 262,802 | $ | 21.03 | 0.65 years | $ | 3,667 | ||||||||
All outstanding stock options were vested prior to December 31, 2013. | ||||||||||||||
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions: 1) the expected term (estimated period of time outstanding) of stock options granted is estimated using the historical exercise behavior of employees; 2) the expected volatility is based on historical volatility for a period equal to the stock option’s expected term; 3) the expected dividend yield is based on the Company’s prevailing dividend rate at the time of grant; and 4) the risk-free rate is based on the U.S. Treasury strips in effect at the time of grant equal to the stock option’s expected term. The Company did not issue any stock options during the six months ended June 30, 2014 and 2013. | ||||||||||||||
During the three and six months ended June 30, 2014 and 2013, information related to stock options is presented as follows: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Weighted average grant date fair value of stock options granted during the period (1) | N/A | N/A | N/A | N/A | ||||||||||
Total intrinsic value of options exercised (in thousands) | $ | — | $ | 297 | $ | 194 | $ | 424 | ||||||
Total fair value of options vested (in thousands) (2) | N/A | N/A | N/A | $ | 363 | |||||||||
(1) The Company did not issue any stock options during the three and six months ended June 30, 2014 and 2013. | ||||||||||||||
(2) Stock options were fully vested during the first quarter of 2013. | ||||||||||||||
As of March 31, 2013, all stock options are fully vested and all compensation cost related to stock options have been recognized. | ||||||||||||||
Restricted Stock Awards | ||||||||||||||
In addition to stock options, the Company also grants restricted stock awards to directors, officers and employees. The restricted stock awards fully vest after three to five years of continued employment from the date of grant. Some of the awards are also subject to achievement of certain established financial goals. The Company becomes entitled to an income tax deduction in an amount equal to the taxable income reported by the holders of the restricted stock when the restrictions are released and the shares are issued. Restricted stock awards are forfeited if officers and employees terminate prior to the lapsing of restrictions or if established financial goals are not achieved. The Company records forfeitures of issued restricted stock as treasury share repurchases. | ||||||||||||||
A summary of the activity for the Company’s time-based and performance-based restricted stock awards as of June 30, 2014, including changes during the six months then ended, is presented below: | ||||||||||||||
June 30, 2014 | ||||||||||||||
Restricted Stock Awards | ||||||||||||||
Time-Based | Performance-Based | |||||||||||||
Weighted | Weighted | |||||||||||||
Average | Average | |||||||||||||
Shares | Price | Shares | Price | |||||||||||
Outstanding at beginning of period | 438,508 | $ | 17.79 | 956,707 | $ | 23.74 | ||||||||
Granted | 12,010 | 31.64 | 603,697 | 36.85 | ||||||||||
Vested | (153,279 | ) | 11.18 | (340,781 | ) | 23.52 | ||||||||
Forfeited | (17,446 | ) | 19.92 | (28,535 | ) | 27.22 | ||||||||
Outstanding at end of period | 279,793 | $ | 21.87 | 1,191,088 | $ | 30.36 | ||||||||
Restricted stock awards are valued at the closing price of the Company’s stock on the date of award. The weighted average fair values of time-based restricted stock awards granted during the six months ended June 30, 2014 and 2013 were $31.64 and $24.30, respectively. The weighted average fair values of performance-based restricted stock awards granted during the six months ended June 30, 2014 and 2013 were $36.85 and $25.25, respectively. The total fair value of time-based restricted stock awards vested for the three months ended June 30, 2014 and 2013 was $587 thousand and $772 thousand, respectively. The total fair value of time-based restricted stock awards vested for the six months ended June 30, 2014 and 2013 was $5.3 million and $17.1 million, respectively. There were no performance-based restricted stock awards vested during the three months ended June 30, 2014 and June 30, 2013. The total fair value of performance-based restricted stock awards vested during the six months ended June 30, 2014 and 2013 was $12.6 million and $4.3 million, respectively. | ||||||||||||||
As of June 30, 2014, total unrecognized compensation cost related to time-based and performance-based restricted stock awards amounted to $2.6 million and $28.8 million, respectively. This cost is expected to be recognized over a weighted average period of 1.6 years and 2.3 years, respectively. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
INVESTMENT SECURITIES | ' | |||||||||||||||||||
INVESTMENT SECURITIES | ' | |||||||||||||||||||
NOTE 6 — INVESTMENT SECURITIES | ||||||||||||||||||||
The following tables present the amortized cost and fair value by major categories of available-for-sale securities: | ||||||||||||||||||||
Gross | Gross | Estimated | ||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||||||
Cost | Gains | Losses | Value | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 450,149 | $ | 791 | $ | (1,628 | ) | $ | 449,312 | |||||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 441,747 | 938 | (4,086 | ) | 438,599 | |||||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 112,607 | 513 | (1,363 | ) | 111,757 | |||||||||||||||
Residential mortgage-backed securities | 798,915 | 8,108 | (9,057 | ) | 797,966 | |||||||||||||||
Municipal securities | 289,200 | 4,926 | (4,647 | ) | 289,479 | |||||||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 57,065 | 557 | (416 | ) | 57,206 | |||||||||||||||
Other commercial mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 51,000 | 463 | — | 51,463 | ||||||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 211,144 | 1,172 | (1,446 | ) | 210,870 | |||||||||||||||
Non-investment grade | 19,953 | 131 | (3,505 | ) | 16,579 | |||||||||||||||
Other securities | 102,383 | 4,542 | (504 | ) | 106,421 | |||||||||||||||
Total investment securities available-for-sale | $ | 2,534,163 | $ | 22,141 | $ | (26,652 | ) | $ | 2,529,652 | |||||||||||
As of December 31, 2013 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 495,053 | $ | 201 | $ | (3,622 | ) | $ | 491,632 | |||||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 406,807 | 242 | (12,726 | ) | 394,323 | |||||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 182,257 | 1,062 | (4,449 | ) | 178,870 | |||||||||||||||
Residential mortgage-backed securities | 892,435 | 7,729 | (14,927 | ) | 885,237 | |||||||||||||||
Municipal securities | 297,390 | 1,122 | (17,533 | ) | 280,979 | |||||||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 48,129 | — | (1,802 | ) | 46,327 | |||||||||||||||
Other commercial mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 51,000 | 617 | — | 51,617 | ||||||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 312,726 | 613 | (3,344 | ) | 309,995 | |||||||||||||||
Non-investment grade | 20,668 | 62 | (5,629 | ) | 15,101 | |||||||||||||||
Other securities | 80,025 | 555 | (864 | ) | 79,716 | |||||||||||||||
Total investment securities available-for-sale | $ | 2,786,490 | $ | 12,203 | $ | (64,896 | ) | $ | 2,733,797 | |||||||||||
The Company did not have any investment securities held-to-maturity as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||
The fair values of the investment securities are generally determined by independent external pricing service providers who have experience in valuing these securities and by comparison to and/or average of quoted market prices obtained from independent external brokers. The Company performs a monthly analysis on the pricing service quotes and the broker quotes received from third parties to ensure that the prices represent a reasonable estimate of fair value. The procedures include, but are not limited to, initial and ongoing review of third party pricing methodologies, review of pricing trends and monitoring of trading volumes. The Company assesses whether the prices received from independent brokers represent a reasonable estimate of fair value through the use of observable market inputs including comparable trades, the yield curve, spreads and, when available, market indices. As a result of this analysis, if the Company determines there is a more appropriate fair value based upon available market data, the price received from third parties is adjusted accordingly. | ||||||||||||||||||||
Prices from third party pricing services are often unavailable for securities that are rarely traded or are traded only in privately negotiated transactions. As a result, certain securities are priced via independent broker quotations that utilize inputs that may be difficult to corroborate with observable market based data. Additionally, the majority of these independent broker quotations are non-binding. | ||||||||||||||||||||
There were no OTTI credit losses for the three and six months ended June 30, 2014 and 2013. The OTTI credit losses mainly relate to the pooled trust preferred securities recorded in prior periods. The following table shows the Company’s rollforward of the amount related to OTTI credit losses for the periods ended: | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Beginning balance | $ | 115,511 | $ | 115,511 | $ | 115,511 | $ | 115,511 | ||||||||||||
Addition of other-than-temporary impairment that was not previously recognized | — | — | — | — | ||||||||||||||||
Additional increases to the amount related to the credit loss for which an other-than-temporary impairment was previously recognized | — | — | — | — | ||||||||||||||||
Reduction for securities sold | — | — | — | — | ||||||||||||||||
Ending balance | $ | 115,511 | $ | 115,511 | $ | 115,511 | $ | 115,511 | ||||||||||||
The Company recorded $671 thousand and $5.3 million of gross gains from the sales of investment securities during the three months ended June 30, 2014 and 2013, respectively. The tax expense on the sale of investment securities available-for-sale amounted to $282 thousand and $2.2 million for the three months ended June 30, 2014 and 2013, respectively. Total net proceeds for these sales were $21.6 million and $128.9 million for the three months ended June 30, 2014 and 2013, respectively. | ||||||||||||||||||||
During the six months ended June 30, 2014, the Company recorded $4.2 million of gross gains and $127 thousand of gross losses resulting in a net income statement impact of $4.1 million of gains on sales of investment securities. The gross $127 thousand of losses resulted from the investment securities acquired from MetroCorp which were sold immediately after the acquisition closed. In comparison, the Company recorded $10.9 million of gross gains and no gross losses on sales of investment securities during the six months ended June 30, 2013. The tax expense on the sales of investment securities available-for-sale amounted to $1.7 million and $4.6 million for the six months ended June 30, 2014 and 2013, respectively. Total net proceeds for these sales were $351.8 million and $325.7 million for the six months ended June 30, 2014 and 2013, respectively. | ||||||||||||||||||||
The following tables present the Company’s investment portfolio’s gross unrealized losses and related fair values, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of June 30, 2014 and December 31, 2013: | ||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||
(In thousands) | ||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 30,630 | $ | (40 | ) | $ | 184,740 | $ | (1,588 | ) | $ | 215,370 | $ | (1,628 | ) | |||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 33,829 | (882 | ) | 171,913 | (3,204 | ) | 205,742 | (4,086 | ) | |||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 23,683 | (513 | ) | 43,550 | (850 | ) | 67,233 | (1,363 | ) | |||||||||||
Residential mortgage-backed securities | 205,095 | (1,992 | ) | 306,292 | (7,065 | ) | 511,387 | (9,057 | ) | |||||||||||
Municipal securities | 3,949 | (15 | ) | 138,062 | (4,632 | ) | 142,011 | (4,647 | ) | |||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | — | — | 14,485 | (416 | ) | 14,485 | (416 | ) | ||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 19,943 | (57 | ) | 89,752 | (1,389 | ) | 109,695 | (1,446 | ) | |||||||||||
Non-investment grade | — | — | 14,660 | (3,505 | ) | 14,660 | (3,505 | ) | ||||||||||||
Other securities | 16,160 | (440 | ) | 2,904 | (64 | ) | 19,064 | (504 | ) | |||||||||||
Total investment securities available-for-sale | $ | 333,289 | $ | (3,939 | ) | $ | 966,358 | $ | (22,713 | ) | $ | 1,299,647 | $ | (26,652 | ) | |||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||
(In thousands) | ||||||||||||||||||||
As of December 31, 2013 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 337,248 | $ | (3,622 | ) | $ | — | $ | — | $ | 337,248 | $ | (3,622 | ) | ||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 387,097 | (12,726 | ) | — | — | 387,097 | (12,726 | ) | ||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 114,754 | (3,280 | ) | 16,065 | (1,169 | ) | 130,819 | (4,449 | ) | |||||||||||
Residential mortgage-backed securities | 502,285 | (10,570 | ) | 92,540 | (4,357 | ) | 594,825 | (14,927 | ) | |||||||||||
Municipal securities | 173,782 | (10,765 | ) | 47,892 | (6,768 | ) | 221,674 | (17,533 | ) | |||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 46,328 | (1,802 | ) | — | — | 46,328 | (1,802 | ) | ||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 193,482 | (1,538 | ) | 79,442 | (1,806 | ) | 272,924 | (3,344 | ) | |||||||||||
Non-investment grade | — | — | 14,422 | (5,629 | ) | 14,422 | (5,629 | ) | ||||||||||||
Other securities | 48,098 | (864 | ) | — | — | 48,098 | (864 | ) | ||||||||||||
Total investment securities available-for-sale | $ | 1,803,074 | $ | (45,167 | ) | $ | 250,361 | $ | (19,729 | ) | $ | 2,053,435 | $ | (64,896 | ) | |||||
Unrealized Losses | ||||||||||||||||||||
The majority of the total unrealized losses related to securities are related to residential agency mortgage-backed securities, municipal securities and government sponsored debt securities. As of June 30, 2014, residential agency mortgage-backed securities, municipal securities and government sponsored debt securities represented 32%, 11% and 17% of the total investment securities available-for-sale portfolio, respectively. As of December 31, 2013, residential agency mortgage-backed securities, municipal securities, and government sponsored debt securities represented approximately 32%, 10% and 14% of the total investment securities available-for-sale portfolio, respectively. The Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell these securities before recovery of their current amortized cost basis. As such, the Company does not deem any of the securities as of June 30, 2014 and December 31, 2013 to be other-than-temporarily impaired. | ||||||||||||||||||||
As of June 30, 2014, there were 37 securities that have been in a continuous unrealized loss position for less than twelve months. The securities in an unrealized loss position for less than twelve months include 22 residential agency mortgage-backed securities, 3 U.S. Treasury securities, 5 commercial agency mortgage-backed securities, 2 municipal securities, 2 government sponsored debt securities, 1 investment grade corporate debt securities and 2 other securities. These securities have fluctuated in value since their purchase dates as market interest rates have fluctuated. | ||||||||||||||||||||
As of June 30, 2014, there were 168 securities, not including the 37 securities above, that have been in a continuous unrealized loss position for twelve months or more. These securities are comprised of 79 municipal securities with a total fair value of $138.1 million, 44 residential agency mortgage-backed securities with a fair value of $306.3 million, 5 government sponsored debt securities with a fair value of $171.9 million, 2 other residential mortgage-backed securities with a total fair value of $14.5 million, 6 investment grade corporate debt securities with a fair value of $89.8 million, 4 non-investment grade corporate debt securities with a fair value of $14.7 million, 9 commercial agency mortgage-backed securities with a fair value of $43.6 million, 18 U.S. Treasury securities with a fair value of $184.7 million, and 1 other security with a fair value of $2.9 million. The unrealized losses on these securities are primarily attributed to yield curve movement, together with the widened liquidity spread and credit spread. The issuers of these securities have not, to our knowledge, established any cause for default on these securities. These securities have fluctuated in value since their purchase dates as market interest rates have fluctuated. | ||||||||||||||||||||
As of December 31, 2013, there were 65 securities which have been in a continuous unrealized loss position for twelve months or more. These securities are comprised of 32 municipal securities with a total fair value of $47.9 million, 21 residential agency mortgage-backed securities with a total fair value of $92.5 million, 5 trust preferred securities with a total fair value of $14.4 million, 4 investment grade corporate debt securities with a total fair value of $79.4 million and 3 commercial agency mortgage-backed securities with a total fair value of $16.1 million. As of December 31, 2013, there were also 239 securities, not including the 65 securities above, which have been in a continuous unrealized loss position for less than twelve months. The securities in an unrealized loss position for less than twelve months include 94 municipal securities, 55 residential agency mortgage-backed securities, 33 U.S. Treasury securities, 19 commercial agency mortgage-backed securities, 16 government sponsored debt securities, 8 investment grade corporate debt securities, 5 other residential mortgage-backed securities and 9 other securities. These securities have fluctuated in value since their purchase dates as market interest rates have fluctuated. | ||||||||||||||||||||
Investment Securities Maturities | ||||||||||||||||||||
The scheduled maturities of investment securities at June 30, 2014 are presented as follows: | ||||||||||||||||||||
Amortized | Estimated | |||||||||||||||||||
Cost | Fair Value | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Due within one year | $ | 457,710 | $ | 451,738 | ||||||||||||||||
Due after one year through five years | 557,768 | 558,346 | ||||||||||||||||||
Due after five years through ten years | 549,307 | 553,528 | ||||||||||||||||||
Due after ten years | 969,378 | 966,040 | ||||||||||||||||||
Total investment securities available-for-sale | $ | 2,534,163 | $ | 2,529,652 | ||||||||||||||||
Actual maturities of mortgage-backed securities can differ from contractual maturities because borrowers have the right to prepay obligations. In addition, such factors as prepayments and interest rates may affect the yields on the carrying values of mortgage-backed securities. |
DERIVATIVE_FINANCIAL_INSTRUMEN
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING | ' | |||||||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING | ' | |||||||||||||||||||
NOTE 7 — DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING | ||||||||||||||||||||
The following table presents the fair values and balance sheet classification of derivative instruments as of June 30, 2014 and December 31, 2013. The valuation methodology of derivative instruments is disclosed in Note 4 to the Company’s consolidated financial statements. | ||||||||||||||||||||
Fair Values of Derivative Instruments | ||||||||||||||||||||
June 30, 2014 | December 31, 2013 | |||||||||||||||||||
Notional | Derivative | Derivative | Notional | Derivative | Derivative | |||||||||||||||
Amount | Assets (1) | Liabilities (1) | Amount | Assets (1) | Liabilities (1) | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Derivatives designated as hedging instruments: | ||||||||||||||||||||
Interest rate swaps on certificates of deposit—fair value | $ | 135,000 | $ | — | $ | 11,157 | $ | 135,000 | $ | — | $ | 16,906 | ||||||||
Total derivatives designated as hedging instruments | $ | 135,000 | $ | — | $ | 11,157 | $ | 135,000 | $ | — | $ | 16,906 | ||||||||
Derivatives not designated as hedging instruments: | ||||||||||||||||||||
Foreign exchange options | $ | 85,614 | $ | 6,049 | $ | 3,362 | $ | 85,614 | $ | 6,290 | $ | 3,655 | ||||||||
Interest rate swaps and caps | 2,109,922 | 30,233 | 29,573 | 1,915,474 | 28,078 | 26,352 | ||||||||||||||
Foreign exchange contracts | 476,700 | 4,499 | 4,296 | 440,848 | 6,181 | 3,349 | ||||||||||||||
Total derivatives not designated as hedging instruments | $ | 2,672,236 | $ | 40,781 | $ | 37,231 | $ | 2,441,936 | $ | 40,549 | $ | 33,356 | ||||||||
(1) Derivative assets, which are a component of other assets, include the estimated settlement of the derivative asset position. Derivative liabilities, which are a component of other liabilities and deposits, include the estimated settlement of the derivative liability position. | ||||||||||||||||||||
Derivatives Designated as Hedging Instruments | ||||||||||||||||||||
Interest Rate Swaps on Certificates of Deposit — The Company is exposed to changes in the fair value of certain fixed rate certificates of deposit due to changes in the benchmark interest rate, London Interbank Offering Rate (“LIBOR”). Interest rate swaps designated as fair value hedges involve the receipt of fixed rate amounts from a counterparty in exchange for the Company making variable-rate payments over the life of the agreements without the exchange of the underlying notional amount. The interest rate swaps and the associated certificates of deposit have the same maturity dates. | ||||||||||||||||||||
As of June 30, 2014 and December 31, 2013, the total notional amount of the interest rate swaps on the certificates of deposit was $135.0 million. The fair value of the interest rate swaps amounted to a $11.2 million and $16.9 million liability, respectively, as of June 30, 2014 and December 31, 2013. During the three and six months ended June 30, 2014, the Company recognized a net increase of $538 thousand and $339 thousand, respectively, in expense related to hedge ineffectiveness. In addition, the Company recognized a net increase to interest expense of $2.0 million and $4.0 million, for the three and six months ended June 30, 2014, related to net settlements on the derivatives. | ||||||||||||||||||||
Derivatives Not Designated as Hedging Instruments | ||||||||||||||||||||
Foreign Exchange Options — During 2010, the Company entered into foreign exchange option contracts with major brokerage firms to economically hedge against currency exchange rate fluctuations in a certificate of deposit product available to bank customers. This product, which has a term of 5 years, pays interest based on the performance of the Chinese currency Renminbi (“RMB”) relative to the USD. Under ASC 815, a certificate of deposit that pays interest based on changes in currency exchange rates is a hybrid instrument with an embedded derivative that must be accounted for separately from the host contract (i.e., the certificate of deposit). In accordance with ASC 815, both the embedded derivative instruments and the freestanding foreign exchange option contracts are marked-to-market each reporting period with resulting changes in fair value reported in the consolidated statements of income. | ||||||||||||||||||||
As of June 30, 2014 and December 31, 2013 the notional amount of the foreign exchange options totaled $85.6 million. The fair values of the foreign exchange options and embedded derivative liability for these contracts amounted to a $6.0 million asset and a $3.4 million liability as of June 30, 2014. The fair values of the foreign exchange options and embedded derivative liability for these contracts amounted to a $6.3 million asset and a $3.7 million liability as of December 31, 2013. | ||||||||||||||||||||
Interest Rate Swaps and Caps — The Company enters into interest rate derivatives including interest rate swap and caps with its customers allowing them to hedge against the risk of rising interest rates on their variable rate loans. To economically hedge against interest rate risks in offering such products, the Company also enters into mirror interest rate contracts with institutional counterparties. Thus, the Company does not assume any interest rate risk since the contracts mirror each other. As of June 30, 2014, the total notional amounts of the interest rate swaps and caps, including mirror transactions, with the institutional counterparties and the bank customers totaled a $2.11 billion asset and a $2.11 billion liability. In comparison, as of December 31, 2013, the total notional amounts of the interest rate swaps and caps, including mirror transactions, with the institutional counterparties and the bank customers totaled a $1.92 billion asset and a $1.92 billion liability. The interest rate contracts are marked-to-market each reporting period with resulting changes in fair value reported in the consolidated statements of income. | ||||||||||||||||||||
The fair values of the interest rate swap and cap contracts with the institutional counterparties and the bank customers amounted to a $30.2 million asset and a $29.6 million liability, as of June 30, 2014. The fair values of the interest rate swap and cap contracts with the institutional counterparty and the bank customers amounted to a $28.1 million asset and a $26.4 million liability, as of December 31, 2013. | ||||||||||||||||||||
Foreign Exchange Contracts — The Company enters into short-term foreign exchange forward contracts on a regular basis to economically hedge against foreign exchange rate fluctuations. As of June 30, 2014 and December 31, 2013, the notional amount of the short-term foreign exchange contracts totaled $462.8 million and $426.0 million, respectively. The fair values of the short-term foreign exchange contracts amounted to a $4.3 million asset and a $4.1 million liability, as of June 30, 2014. The fair values of the short-term foreign exchange contracts amounted to a $6.0 million asset and a $3.2 million liability, as of December 31, 2013. The gross aggregate value of the short-term foreign exchange contracts by counterparty was a liability of $923 thousand as of June 30, 2014 and an asset of $1.5 million as of December 31, 2013. | ||||||||||||||||||||
The Company also entered into long-term foreign exchange contracts to purchase/sell foreign currencies at set rates in the future. As of June 30, 2014 and December 31, 2013, the notional amount of the long-term foreign exchange contracts totaled $13.9 million and $14.8 million, respectively. The fair values of the long-term foreign exchange contracts amounted to a $188 thousand asset and a $203 thousand liability, as of June 30, 2014. The fair values of the long-term foreign exchange contracts amounted to a $200 thousand asset and a $183 thousand liability, as of December 31, 2013. | ||||||||||||||||||||
The table below presents the effect of the Company’s derivative financial instruments on the consolidated statements of income for the three and six months ended June 30, 2014 and 2013: | ||||||||||||||||||||
Location in | Three Months Ended | Six Months Ended | ||||||||||||||||||
Consolidated | June 30, | June 30, | ||||||||||||||||||
Statements of Income | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||||||
Interest rate swaps on certificates of deposit—fair value | Interest expense | $ | 3,045 | $ | (3,810 | ) | $ | 5,750 | $ | (4,715 | ) | |||||||||
Total net income (expense) | $ | 3,045 | $ | (3,810 | ) | $ | 5,750 | $ | (4,715 | ) | ||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||||||
Foreign exchange options | Noninterest income | 173 | 97 | 54 | 238 | |||||||||||||||
Foreign exchange options | Noninterest expense | (3 | ) | (1 | ) | (2 | ) | 6 | ||||||||||||
Interest rate swaps and caps | Noninterest income | (130 | ) | 1,864 | (1,066 | ) | 2,080 | |||||||||||||
Foreign exchange contracts | Noninterest income | (500 | ) | (719 | ) | (2,629 | ) | (762 | ) | |||||||||||
Total net (expense) income | $ | (460 | ) | $ | 1,241 | $ | (3,643 | ) | $ | 1,562 | ||||||||||
Credit Risk-Related Contingent Features — The Company has agreements with some of its derivative counterparties that contain a provision where if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations. | ||||||||||||||||||||
The Company also has agreements with some of its derivative counterparties that contain a provision where if the Company fails to maintain its status as a well/adequately capitalized institution, then the counterparty could terminate the derivative positions and the Company would be required to settle its obligations under the agreements. Similarly, the Company could be required to settle its obligations under certain of its agreements if the Company was issued a notice of prompt corrective action. | ||||||||||||||||||||
Balance Sheet Offsetting — The Company has entered into agreements with all counterparty financial institutions, which include master netting agreements. However, the Company elects to account for all derivatives with counterparty institutions on a gross basis, excluding certain foreign exchange options which are not under agreements that include master netting terms. The Company has also entered into securities purchased under resale agreements (“resale agreements”), and securities sold under agreements to repurchase (“repurchase agreements”) which have master netting agreements that allow for the netting of collateral positions. These repurchase and resale agreements of securities are not eligible for offset in the consolidated balance sheet. | ||||||||||||||||||||
The following tables show the gross derivatives, resale agreements and repurchase agreements in the consolidated balance sheets and for each the respective collateral received or pledged in the form of other financial instruments, which are generally marketable securities. The collateral amounts in these tables are limited to the outstanding balances of the related asset or liability (after netting is applied); thus instances of overcollateralization are not shown. All of the assets and liabilities in the following tables were transacted under master netting arrangements that contain a conditional right of offset, such as close-out netting, upon default. Collateral accepted or pledged in resale and repurchase agreements with other financial institutions also may be sold or re-pledged by the secured party, but is usually delivered to and held by third party trustees. | ||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Assets Presented | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | in the | Consolidated Balance Sheets | |||||||||||||||||
Assets | of Recognized | Consolidated | Consolidated | Financial | Collateral | Net Amount | ||||||||||||||
Assets | Balance Sheets | Balance Sheets | Instruments | Received | ||||||||||||||||
Derivatives | $ | 9,711 | $ | — | $ | 9,711 | $ | (5,122 | ) | $ | (4,589 | )(1) | $ | — | ||||||
Resale Agreements | $ | 1,275,000 | $ | — | $ | 1,275,000 | $ | (475,000 | ) | $ | (800,000 | )(2) | $ | — | ||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Liabilities | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | Presented in the | Consolidated Balance Sheets | |||||||||||||||||
Liabilities | of Recognized | Consolidated | Consolidated | Financial | Collateral Posted | Net Amount | ||||||||||||||
Liabilities | Balance Sheets | Balance Sheets | Instruments | |||||||||||||||||
Derivatives | $ | 40,459 | $ | — | $ | 40,459 | $ | (5,122 | ) | $ | (35,337 | )(3) | $ | — | ||||||
Repurchase Agreements | $ | 1,005,211 | $ | — | $ | 1,005,211 | $ | (475,000 | ) | $ | (530,211 | )(4) | $ | — | ||||||
As of December 31, 2013 | ||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Assets Presented | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | in the | Consolidated Balance Sheets | |||||||||||||||||
Assets | of Recognized | Consolidated | Consolidated | Financial | Collateral | Net Amount | ||||||||||||||
Assets | Balance Sheets | Balance Sheets | Instruments | Received | ||||||||||||||||
Derivatives | $ | 16,043 | $ | — | $ | 16,043 | $ | (11,363 | ) | $ | (4,680 | )(1) | $ | — | ||||||
Resale Agreements | $ | 1,400,000 | $ | — | $ | 1,400,000 | $ | (495,000 | ) | $ | (905,000 | )(2) | $ | — | ||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Liabilities | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | Presented in the | Consolidated Balance Sheets | |||||||||||||||||
Liabilities | of Recognized | Consolidated | Consolidated | Financial | Collateral Posted | Net Amount | ||||||||||||||
Liabilities | Balance Sheets | Balance Sheets | Instruments | |||||||||||||||||
Derivatives | $ | 33,849 | $ | — | $ | 33,849 | $ | (11,363 | ) | $ | (22,486 | )(3) | $ | — | ||||||
Repurchase Agreements | $ | 995,000 | $ | — | $ | 995,000 | $ | (495,000 | ) | $ | (500,000 | )(4) | $ | — | ||||||
(1) Represents cash and securities received against derivative assets with the same counterparty that are subject to enforceable master netting arrangements. Includes approximately $3.6 million of cash collateral received as of June 30, 2014. | ||||||||||||||||||||
(2) Represents the fair value of securities the Company has received under resale agreements, limited for table presentation purposes to the amount of the recognized asset due from each counterparty. | ||||||||||||||||||||
(3) Represents cash and securities pledged against derivative liabilities with the same counterparty that are subject to enforceable master netting arrangements. Includes approximately $7.5 million and $187 thousand of cash collateral posted as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
(4) Represents the fair value of securities the Company has pledged under repurchase agreements, limited for table presentation purposes to the amount of the recognized liability owed to each counterparty. |
COVERED_ASSETS_AND_FDIC_INDEMN
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET | ' | |||||||||||||||||||
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET | ' | |||||||||||||||||||
NOTE 8 — COVERED ASSETS AND FDIC INDEMNIFICATION ASSET | ||||||||||||||||||||
Covered Assets | ||||||||||||||||||||
Covered assets consist of loans receivable and OREO that were acquired in the Washington First International Bank (“WFIB”) Acquisition on June 11, 2010 and in the United Commercial Bank (“UCB”) Acquisition on November 6, 2009 for which the Company entered into shared-loss agreements (the “shared-loss agreements”) with the FDIC. The shared-loss agreements covered over 99% of the loans originated by WFIB and all of the loans originated by UCB, excluding the loans originated by UCB in China under its United Commercial Bank China (Limited) subsidiary. The Company shares in the losses, which began with the first dollar of loss incurred, on covered assets under the shared-loss agreements. | ||||||||||||||||||||
Pursuant to the terms of the shared-loss agreements, the FDIC is obligated to reimburse the Company 80% of eligible losses for both UCB and WFIB with respect to covered assets. For the UCB covered assets, the FDIC will reimburse the Company for 95% of eligible losses in excess of $2.05 billion. The Company has a corresponding obligation to reimburse the FDIC for 80% or 95%, as applicable, of eligible recoveries with respect to covered assets. The commercial loan shared-loss agreement and single-family residential mortgage loan shared-loss agreement are in effect for 5 years and 10 years, respectively, from the acquisition date and the loss recovery provisions of these agreements continue on and are in effect for 8 years and 10 years, respectively, from the acquisition date. | ||||||||||||||||||||
The commercial loan shared-loss agreements related to the UCB and WFIB acquisitions will terminate on November 6, 2014 and June 11, 2015, respectively. The single-family residential mortgage loan shared-loss agreements carry expiration dates of November 6, 2019 and June 11, 2020 for UCB and WFIB, respectively. Upon the completion of these agreements, any losses on loans left in the portfolio will belong solely to the Company. However, due to the performance of the covered loan portfolio, the Company does not expect the expiration of these agreements to have a material impact. | ||||||||||||||||||||
Forty-five days following the 10th anniversary of the respective acquisition date, the Company will be required to pay to the FDIC a calculated amount, based on the specific thresholds of losses not being reached. The calculation of this potential liability as stated in the shared-loss agreements is 50% of the excess, if any of (i) 20% of the Intrinsic Loss Estimate less (ii) the sum of (a) 25% of the asset discount plus (b) 25% of the Cumulative Shared-Loss Payments plus (c) the Cumulative Servicing Amount, if net losses on covered assets subject to the stated threshold are not reached. The Company recorded a liability related to both UCB and WFIB shared-loss agreements of $90.0 million and $74.7 million, respectively, as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||
The Company’s covered loan portfolio consists of (1) purchased credit-impaired (“PCI”) loans and (2) covered advances drawn down on existing commitment lines acquired, subsequent to the UCB and WFIB acquisition dates (covered advances). PCI covered loans represent acquired loans, which the Company elected to account for in accordance with ASC 310-30, “Loans and Debt Securities Acquired with Deteriorated Credit Quality” (“ASC 310-30”). As of the respective acquisition dates, the UCB and WFIB loan portfolios included unfunded commitments for commercial lines of credit, construction draws and other lending activity. These commitments are covered under the shared-loss agreements. However, the covered advances are not accounted for under ASC 310-30. | ||||||||||||||||||||
At acquisition, loans were pooled and accounted for at fair value, which represents the discounted value of the expected cash flows of the loan portfolio. Nonaccretable difference represents the Company’s estimate of the expected credit losses, which was considered in determining the fair value of the loans as of the respective acquisition dates. In estimating nonaccretable difference, the Company (a) calculated the contractual amount and timing of undiscounted principal and interest payments (the “undiscounted contractual cash flows”) and (b) estimated the amount and timing of undiscounted expected principal and interest payments (the “undiscounted expected cash flows”). In the determination of contractual cash flows and cash flows expected to be collected, the Company assumed no prepayments on the PCI nonaccrual loan pools since we do not anticipate any significant prepayments on credit impaired loans. For the PCI accrual loans for single-family, multifamily and commercial real estate, the Company utilized a recognized third party vendor to obtain prepayment speeds. As the prepayment rates for the construction, land, and commercial and consumer loan pools have historically been low, the Company applied the prepayment assumptions of the current portfolio using internal modeling. The difference between the undiscounted contractual cash flows and the undiscounted expected cash flows is the nonaccretable difference. The amount by which the undiscounted expected cash flows exceed the estimated fair value (the “accretable yield”) is accreted into interest income over the life of the loans. | ||||||||||||||||||||
The following tables present the composition of the covered loans as of June 30, 2014 and December 31, 2013: | ||||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Residential: | ||||||||||||||||||||
Residential single-family | $ | 259,438 | $ | 290,095 | ||||||||||||||||
Residential multifamily | 361,472 | 403,508 | ||||||||||||||||||
Total residential | 620,910 | 693,603 | ||||||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||
Commercial and industrial real estate | 895,140 | 1,103,530 | ||||||||||||||||||
Construction and land | 73,216 | 163,833 | ||||||||||||||||||
Total CRE | 968,356 | 1,267,363 | ||||||||||||||||||
Other Loans: | ||||||||||||||||||||
Commercial business | 331,117 | 426,621 | ||||||||||||||||||
Other consumer | 68,944 | 73,973 | ||||||||||||||||||
Total other loans | 400,061 | 500,594 | ||||||||||||||||||
Total covered loans receivable | 1,989,327 | -1 | 2,461,560 | -2 | ||||||||||||||||
Covered discount | (181,357 | ) | (265,917 | ) | ||||||||||||||||
Net valuation of loans | 1,807,970 | 2,195,643 | ||||||||||||||||||
Allowance on covered loans | (4,880 | ) | (7,745 | ) | ||||||||||||||||
Total covered loans, net | $ | 1,803,090 | $ | 2,187,898 | ||||||||||||||||
Collectively evaluated for impairment | $ | 252,205 | -1 | $ | 320,185 | -2 | ||||||||||||||
Acquired with deteriorated credit quality | 1,555,765 | 1,875,458 | ||||||||||||||||||
$ | 1,807,970 | $ | 2,195,643 | |||||||||||||||||
(1) Includes $252.2 million of covered advances comprised of $202.5 million, $29.0 million, $11.7 million and $9.0 million of commercial and industrial, consumer, residential and commercial real estate loans, respectively. | ||||||||||||||||||||
(2) Includes $320.2 million of covered advances comprised of $230.6 million, $46.7 million, $30.9 million and $12.0 million of commercial and industrial, commercial real estate, consumer and residential loans, respectively. | ||||||||||||||||||||
Credit Quality Indicators | ||||||||||||||||||||
Covered loans acquired are subject to the Bank’s internal and external credit review and monitoring. The same credit quality indicators are reviewed for the covered portfolio as the non-covered portfolio, to enable the monitoring of the borrower’s credit and the likelihood of repayment. | ||||||||||||||||||||
Loans are risk rated based on analysis of the current state of the borrower’s credit quality. The analysis of credit quality includes a review of all repayment sources, the borrower’s current financial and liquidity status and all other relevant information. The Company utilizes an eight grade risk rating system, where a higher grade represents a higher level of credit risk. The eight grade risk rating system can be generally classified by the following categories: Pass, Watch, Special Mention, Substandard, Doubtful and Loss. The risk ratings reflect the relative strength of the repayment sources. Refer to Note 9 for a full discussion of risk ratings. | ||||||||||||||||||||
As of June 30, 2014 and December 31, 2013, the majority of the PCI covered loan portfolio was performing better than expected from the day one valuation. As a result, the Company reduced the nonaccretable difference due to the improved performance of the portfolio. By decreasing the nonaccretable discount, the overall accretable yield will increase, thus increasing the interest income recognized over the remaining life of the loans. This reduction was primarily due to loan paydowns. However, the Company has experienced some credit deterioration in certain PCI covered loan pools. Based on the Company’s estimates of cash flows expected to be collected, the Company may establish an allowance for the PCI covered pool of loans, with a charge to income through the provision for loan losses, where appropriate. As of June 30, 2014, the Company has established an allowance of $1.2 million on $66.3 million of PCI covered loans. As of December 31, 2013, an allowance of $2.2 million was established on $129.7 million of PCI covered loans. The allowance balances for both periods were allocated mainly to the PCI covered commercial real estate loans. With respect to the covered advances, losses are estimated collectively for groups of loans with similar characteristics. Refer to Note 9 for a discussion on the Company’s allowance for loan losses methodology. | ||||||||||||||||||||
The following tables present a summary of the activity in the allowance for loan losses on the PCI covered loans and the covered advances for the periods indicated. | ||||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Covered | PCI Covered | Covered | PCI Covered | |||||||||||||||||
Advances | Loans | Total | Advances | Loans | Total | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Beginning balance | $ | 4,316 | $ | 2,202 | $ | 6,518 | $ | 8,118 | $ | 1,992 | $ | 10,110 | ||||||||
Provision for (reversal of) loan losses | 70 | (1,014 | ) | (944 | ) | 186 | 537 | 723 | ||||||||||||
Charge-offs | (694 | ) | — | (694 | ) | (1,204 | ) | — | (1,204 | ) | ||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
Ending balance allocated to: | ||||||||||||||||||||
Collectively evaluated for impairment | 3,692 | -1 | — | 3,692 | -1 | 7,100 | -2 | — | 7,100 | |||||||||||
Acquired with deteriorated credit quality | — | 1,188 | 1,188 | — | 2,529 | 2,529 | ||||||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
Six Months Ended June 30, | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Covered | PCI Covered | Covered | PCI Covered | |||||||||||||||||
Advances | Loans | Total | Advances | Loans | Total | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Beginning balance | $ | 5,476 | $ | 2,269 | $ | 7,745 | $ | 5,153 | $ | — | $ | 5,153 | ||||||||
(Reversal of) provision for loan losses | (884 | ) | (1,081 | ) | (1,965 | ) | 3,283 | 2,529 | 5,812 | |||||||||||
Charge-offs | (900 | ) | — | (900 | ) | (1,336 | ) | — | (1,336 | ) | ||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
Ending balance allocated to: | ||||||||||||||||||||
Collectively evaluated for impairment | 3,692 | -1 | — | 3,692 | -1 | 7,100 | -2 | — | 7,100 | |||||||||||
Acquired with deteriorated credit quality | — | 1,188 | 1,188 | — | 2,529 | 2,529 | ||||||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
(1) $2.6 million, $666 thousand, $282 thousand and $167 thousand of allowance for loan losses are allocated to commercial and industrial, commercial real estate, consumer and residential loans, respectively. | ||||||||||||||||||||
(2) $4.1 million, $2.4 million, $407 thousand and $174 thousand of allowance for loan losses are allocated to commercial and industrial, commercial real estate, consumer and residential loans, respectively. | ||||||||||||||||||||
The following tables present the credit risk rating categories for the covered loans by portfolio segments as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||
Special | ||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||
Residential: | ||||||||||||||||||||
Residential single-family | $ | 252,121 | $ | 757 | $ | 6,560 | $ | — | $ | 259,438 | ||||||||||
Residential multifamily | 327,990 | 786 | 32,696 | — | 361,472 | |||||||||||||||
Total residential | 580,111 | 1,543 | 39,256 | — | 620,910 | |||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||
Commercial and industrial real estate | 755,244 | 3,255 | 130,173 | 6,468 | 895,140 | |||||||||||||||
Construction and land | 25,628 | 9,235 | 37,461 | 892 | 73,216 | |||||||||||||||
Total CRE | 780,872 | 12,490 | 167,634 | 7,360 | 968,356 | |||||||||||||||
Other Loans: | ||||||||||||||||||||
Commercial business | 282,018 | 7,171 | 41,928 | — | 331,117 | |||||||||||||||
Other consumer | 67,320 | 100 | 1,524 | — | 68,944 | |||||||||||||||
Total other loans | 349,338 | 7,271 | 43,452 | — | 400,061 | |||||||||||||||
Total principal balance | $ | 1,710,321 | $ | 21,304 | $ | 250,342 | $ | 7,360 | $ | 1,989,327 | ||||||||||
Special | ||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||
Residential: | ||||||||||||||||||||
Residential single-family | $ | 281,246 | $ | 733 | $ | 8,116 | $ | — | $ | 290,095 | ||||||||||
Residential multifamily | 373,024 | 785 | 29,699 | — | 403,508 | |||||||||||||||
Total residential | 654,270 | 1,518 | 37,815 | — | 693,603 | |||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||
Commercial and industrial real estate | 857,376 | 27,851 | 211,835 | 6,468 | 1,103,530 | |||||||||||||||
Construction and land | 41,847 | 9,472 | 111,616 | 898 | 163,833 | |||||||||||||||
Total CRE | 899,223 | 37,323 | 323,451 | 7,366 | 1,267,363 | |||||||||||||||
Other Loans: | ||||||||||||||||||||
Commercial business | 378,086 | 4,635 | 43,797 | 103 | 426,621 | |||||||||||||||
Other consumer | 72,053 | 128 | 1,792 | — | 73,973 | |||||||||||||||
Total other loans | 450,139 | 4,763 | 45,589 | 103 | 500,594 | |||||||||||||||
Total principal balance | $ | 2,003,632 | $ | 43,604 | $ | 406,855 | $ | 7,469 | $ | 2,461,560 | ||||||||||
Credit Risk and Concentration | ||||||||||||||||||||
At each respective acquisition date, the covered loans were grouped into pools of loans with similar characteristics and risk factors per ASC 310-30. The pools were first developed based on loan categories and performance status. As of June 30, 2014 and December 31, 2013, UCB covered loans comprised approximately 94% of total covered loans. In respect of the UCB acquisition, the loans were further segregated among the former UCB domestic, Hong Kong and China portfolios, representing three general geographic regions. The Company evaluated the make-up of geographic regions within the construction, land, and multi-family loan portfolios and further segregated these pools into distressed and non-distressed regions, based on the Company’s historical experience with real estate loans within the non-covered portfolio. As of the UCB acquisition date, 64%, 10% and 11% of the UCB portfolio were located in California, Hong Kong and New York, respectively. This assessment was factored into the day one valuation and discount applied to the loans. As such, geographic concentration risk is considered in the covered loan discount. | ||||||||||||||||||||
Covered Nonperforming Assets | ||||||||||||||||||||
The following table presents the Company’s covered nonperforming assets as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Covered nonaccrual loans(1) (2) (3) | $ | 86,771 | $ | 126,895 | ||||||||||||||||
Other real estate owned covered, net | 24,779 | 21,373 | ||||||||||||||||||
Total covered nonperforming assets | $ | 111,550 | $ | 148,268 | ||||||||||||||||
(1) Covered nonaccrual loans include loans that meet the criteria for nonaccrual but have a yield accreted through interest income under ASC 310-30. All losses on covered loans are 80% reimbursed by the FDIC. | ||||||||||||||||||||
(2) Net of discount. | ||||||||||||||||||||
(3) Includes $14.3 million and $17.7 million of covered advances as of June 30, 2014 and December 31, 2013, respectively; and $72.5 million and $109.2 million of PCI loans as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
As of June 30, 2014 and December 31, 2013, there were no accruing covered loans that were past due 90 days or more. | ||||||||||||||||||||
Troubled Debt Restructurings | ||||||||||||||||||||
The following tables present the Company’s troubled debt restructurings for the periods indicated: | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 73,234 | $ | 141,923 | $ | 116,007 | $ | 157,736 | ||||||||||||
Additions | 704 | 3,709 | 787 | 25,793 | ||||||||||||||||
Transfers to covered OREO | — | — | (1,230 | ) | — | |||||||||||||||
Charge-offs | (500 | ) | (3,762 | ) | (1,323 | ) | (7,466 | ) | ||||||||||||
Paydowns/ Reductions | (13,414 | ) | (21,622 | ) | (54,217 | ) | (55,815 | ) | ||||||||||||
Balance at end of period | $ | 60,024 | $ | 120,248 | $ | 60,024 | $ | 120,248 | ||||||||||||
Covered Other Real Estate Owned (“OREO”) | ||||||||||||||||||||
Covered OREO balances were $24.8 million and $21.4 million, net of valuation adjustments of $465 thousand and $2.4 million as of June 30, 2014 and December 31, 2013, respectively. Approximately 26%, 24% and 22% of the covered OREO were located in Massachusetts, California and Washington, respectively, as of June 30, 2014. Approximately 31% of covered OREO were each located in California and Massachusetts as of December 31, 2013. During the first six months of 2014, 10 properties with an aggregate carrying value of $19.6 million were added through foreclosure. During the first six months of 2014, we sold 10 covered OREO properties for total proceeds of $17.7 million resulting in a total net gain on sale of $2.0 million. | ||||||||||||||||||||
Accretable Yield | ||||||||||||||||||||
The following tables summarize the changes in the accretable yield for the PCI covered loans for the three and six months ended June 30, 2014 and 2013. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 424,005 | $ | 503,476 | $ | 461,545 | $ | 556,986 | ||||||||||||
Additions | — | — | — | — | ||||||||||||||||
Accretion | (64,114 | ) | (84,811 | ) | (125,304 | ) | (166,438 | ) | ||||||||||||
Changes in expected cash flows | 27,236 | 40,052 | 50,886 | 68,169 | ||||||||||||||||
Balance at end of period | $ | 387,127 | $ | 458,717 | $ | 387,127 | $ | 458,717 | ||||||||||||
The excess of cash flows expected to be collected over the initial fair value of the PCI loans is referred to as the accretable yield and is accreted into interest income using an effective yield method over the remaining life of the acquired loans. The accretable yield will change due to: | ||||||||||||||||||||
· estimate of the remaining life of acquired loans which may change the amount of future interest income; | ||||||||||||||||||||
· estimate of the amount of contractually required principal and interest payments over the estimated life that will not be collected (the nonaccretable difference); and | ||||||||||||||||||||
· indices for acquired loans with variable rates of interest. | ||||||||||||||||||||
During the second quarter of 2014, the estimate of the amount of contractually required principal and interest payments over the estimated life that will not be collected (the nonaccretable difference) was reduced as the losses on certain loan pools were evaluated and determined to be lower than expected. As a result of the reduction in the nonaccretable yield, the accretable yield increased, as did the amortization of the FDIC indemnification asset. Consequently, $19.6 million and $38.6 million were reclassified from non-accretable yield to accretable yield due to changes in loss rate assumptions, for the three and six months ended June 30, 2014. In comparison, $26.0 million and $39.5 million were reclassified from non-accretable yield to accretable yield due to changes in loss rate assumptions, for the three and six months ended June 30, 2013. Due to ongoing improvement in credit quality of the remaining covered loans, the accrued liability to the FDIC increased during the second quarter of 2014. | ||||||||||||||||||||
From December 31, 2013 to June 30, 2014, excluding scheduled principal payments, a total of $353.7 million of loans were removed from the covered loans accounted for under ASC 310-30 due to loans being paid in full, sold, or charged-off. Interest income was adjusted by $51.1 million related to payoffs and removals offset by charge-offs. | ||||||||||||||||||||
From December 31, 2012 to June 30, 2013, excluding scheduled principal payments, a total of $392.7 million of loans were removed from the covered loans accounted for under ASC 310-30 due to loans being paid in full, sold, transferred to covered OREO or charged-off. Interest income was adjusted by $74.3 million related to payoffs and removals offset by charge-offs. | ||||||||||||||||||||
FDIC Indemnification Asset/(Net Payable to FDIC) | ||||||||||||||||||||
Due to the reductions of the nonaccretable difference on the UCB and WFIB covered loan portfolios, the expected reimbursement from the FDIC under the shared-loss agreements has decreased. The Company is amortizing the difference between the recorded amount of the FDIC indemnification asset and the expected reimbursement from the FDIC over the life of the indemnification asset, in line with the improved accretable yield as discussed above. Due to the estimated losses from the covered portfolio and the corresponding expected payments from the FDIC, the Company recorded an FDIC indemnification asset of $27.6 million as of March 31, 2014. As of June 30, 2014, due to the ongoing improvement in credit quality of the covered portfolio, the Company recorded a net liability to the FDIC of $24.3 million. The following table presents a summary of the FDIC indemnification asset/(net payable to FDIC) for the periods indicated. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 27,552 | $ | 276,834 | $ | 74,708 | $ | 316,313 | ||||||||||||
Amortization | (29,303 | ) | (12,696 | ) | (57,793 | ) | (21,382 | ) | ||||||||||||
Reductions (1) | (14,111 | ) | (28,820 | ) | (25,953 | ) | (52,055 | ) | ||||||||||||
Estimate of FDIC repayment (2) | (8,475 | ) | (15,376 | ) | (15,299 | ) | (22,934 | ) | ||||||||||||
Balance at end of period | $ | (24,337 | ) | $ | 219,942 | $ | (24,337 | ) | $ | 219,942 | ||||||||||
(1) Reductions relate to charge-offs, partial prepayments, loan payoffs and loan sales which result in a corresponding reduction of the indemnification asset. | ||||||||||||||||||||
(2) This represents the change in the calculated estimate the Company will be required to pay the FDIC at the end of the FDIC loss share agreements, due to lower thresholds of losses. | ||||||||||||||||||||
FDIC Receivable | ||||||||||||||||||||
As of June 30, 2014, the FDIC shared-loss receivable was $15.7 million as compared to $30.3 million as of December 31, 2013. This receivable represents current reimbursable amounts from the FDIC, under the FDIC shared-loss agreements that have not yet been received. These reimbursable amounts include net charge-offs, loan related expenses and OREO-related expenses. Consequently, 100% of the loan related and OREO expenses are recorded as noninterest expense, 80% of any reimbursable expense is recorded as noninterest income, netting to the 20% of actual expense paid by the Company. The FDIC also shares in 80% of recoveries received. Thus, the FDIC receivable is reduced when we receive payment from the FDIC as well as when recoveries occur. The FDIC shared-loss receivable is included in other assets on the consolidated balance sheet. | ||||||||||||||||||||
The following tables present a summary of the activity in the FDIC receivable for the periods indicated: | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 19,644 | $ | 46,762 | $ | 30,261 | $ | 73,091 | ||||||||||||
Net (reduction) addition due to recovery or eligible expense/loss | (5,669 | ) | 8,967 | (12,147 | ) | 16,528 | ||||||||||||||
Payments to (received from) the FDIC | 1,772 | (8,604 | ) | (2,367 | ) | (42,494 | ) | |||||||||||||
Balance at end of period | $ | 15,747 | $ | 47,125 | $ | 15,747 | $ | 47,125 |
NONCOVERED_LOANS_AND_ALLOWANCE
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES | 6 Months Ended | |||||||||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||||||||
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES | ' | |||||||||||||||||||||||||
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES | ' | |||||||||||||||||||||||||
NOTE 9 — NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES | ||||||||||||||||||||||||||
The following table presents the composition of loans receivable, excluding covered loans (“non-covered loans”) as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 3,316,581 | $ | 3,192,875 | ||||||||||||||||||||||
Multifamily | 1,133,146 | 992,434 | ||||||||||||||||||||||||
Total residential | 4,449,727 | 4,185,309 | ||||||||||||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||||||||
Income producing | 5,358,710 | 4,301,030 | ||||||||||||||||||||||||
Construction | 233,105 | 140,186 | ||||||||||||||||||||||||
Land | 206,488 | 143,861 | ||||||||||||||||||||||||
Total CRE | 5,798,303 | 4,585,077 | ||||||||||||||||||||||||
Commercial and Industrial (“C&I”): | ||||||||||||||||||||||||||
Commercial business | 5,956,607 | 4,637,056 | ||||||||||||||||||||||||
Trade finance | 716,696 | 723,137 | ||||||||||||||||||||||||
Total C&I | 6,673,303 | 5,360,193 | ||||||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 139,736 | 679,220 | ||||||||||||||||||||||||
Other consumer | 1,216,699 | 868,518 | ||||||||||||||||||||||||
Total consumer | 1,356,435 | 1,547,738 | ||||||||||||||||||||||||
Total loans receivable, excluding covered loans (1) | 18,277,768 | 15,678,317 | ||||||||||||||||||||||||
Unearned fees, premiums, and discounts, net | (5,589 | ) | (23,672 | ) | ||||||||||||||||||||||
Allowance for loan losses, excluding covered loans | (246,468 | ) | (241,930 | ) | ||||||||||||||||||||||
Loans receivable, excluding covered loans, net | $ | 18,025,711 | $ | 15,412,715 | ||||||||||||||||||||||
(1) Loans net of ASC 310-30 discount. | ||||||||||||||||||||||||||
Accrued interest on covered and non-covered loans receivable amounted to $79.5 million and $94.5 million as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||||||||
At June 30, 2014 and December 31, 2013, covered and non-covered loans receivable totaling $12.98 billion and $10.57 billion, respectively, were pledged to secure borrowings from the FHLB and the Federal Reserve Bank. | ||||||||||||||||||||||||||
The Bank offers adjustable rate (“ARM”) first mortgage loans secured by one-to-four unit residential properties located in its primary lending areas. The Bank offers ARM single-family loan programs with one-year or three-year initial fixed periods. The Bank offered in 2013 and prior years, a low documentation program for single family residential loans. These loans require a large down payment and a low loan to value ratio, typically 60% or less. These loans have historically experienced low delinquency and default rates. A majority of the single family residential loan originations in 2013 were originated under this program. In 2014, this program was modified to require not only a large down payment, but additional income or asset information to determine the borrower’s ability to repay. The Bank originated $229.8 million and $413.4 million in new residential single-family loans during the three months ended June 30, 2014 and 2013, respectively. For the six months ended June 30, 2014 and 2013, the Bank originated $411.4 million and $676.5 million, respectively, in new residential single-family loans. | ||||||||||||||||||||||||||
The Bank also offers ARM home equity lines of credit (“HELOC”) secured by one-to-four unit residential properties located in its primary lending areas. The program is a low documentation program that requires low loan to value ratios, typically 60% or less. These loans have historically experienced low delinquency and default rates. The Bank originated $244.5 million and $195.4 million in new HELOCs during the three months ended June 30, 2014 and 2013, respectively. For the six months ended June 30, 2014 and 2013, the Bank originated $493.4 million and $284.6 million, respectively, in new HELOCs. | ||||||||||||||||||||||||||
In addition, the Bank offers ARM residential multifamily loan programs. The Bank originated $154.7 million and $104.2 million in new multifamily residential loans during the six months ended June 30, 2014 and 2013, respectively. The Bank primarily offers ARM multifamily loan programs that have six-month, three-year, or five-year initial fixed periods. In addition to residential lending, the Bank’s lending activities also include CRE, commercial and industrial, and consumer lending. The Bank’s CRE lending activities include loans to finance income-producing properties, construction and land loans. The Bank’s C&I lending activities include commercial business financing for small and middle-market businesses in a wide spectrum of industries. Included in commercial business loans are loans for working capital, accounts receivable lines, inventory lines, small business administration loans and lease financing. The Bank also offers a variety of international trade finance services and products, including letters of credit, revolving lines of credit, import loans, bankers’ acceptances, working capital lines, domestic purchase financing and pre-export financing. Consumer loans are primarily comprised of fully guaranteed student loans, home equity lines of credit, auto loans and insurance premium financing loans. | ||||||||||||||||||||||||||
All of the loans that the Bank originates are subject to its underwriting guidelines and loan origination standards. Management believes that the Bank’s underwriting criteria and procedures adequately consider the unique risks which may come from these products. The Bank conducts a variety of quality control procedures and periodic audits to ensure compliance with its origination standards, including criteria for lending and legal requirements. | ||||||||||||||||||||||||||
Credit Risk and Concentrations — The Company has a concentration of real estate loans in California. As of June 30, 2014, the Company had $5.80 billion in non-covered commercial real estate loans and $4.45 billion in non-covered residential loans, of which approximately 80% are secured by real properties located in California. Deterioration in the real estate market generally, including residential and commercial real estate, could result in additional loan charge-offs and provisions for loan losses in the future, which could have a material adverse effect on the Company’s financial condition, net income and capital. In addition, although most of the Company’s trade finance loans relate to trade with Asian countries and the majority of our loans are made to companies domiciled in the United States. A substantial portion of this business involves California based customers engaged in import and export activities. The Company also offers export-import financing to various domestic and foreign customers. Certain trade finance loans may be guaranteed by the Export-Import Bank of the United States or the Export-Import Bank of China. | ||||||||||||||||||||||||||
Purchased Loans — During the six months ended June 30, 2014, the Company purchased approximately $86.3 million of student loans. These loans are guaranteed by the U.S. Department of Education. | ||||||||||||||||||||||||||
Acquired Loans — In January 2014, the Company acquired $1.19 billion of loans through its acquisition of MetroCorp, as discussed in Note 3 of the Company’s consolidated financial statements. As of the acquisition date, approximately 6% of the acquired loans were credit impaired and accounted for in accordance with ASC 310-30. As of June 30, 2014, there were $58.9 million PCI loans acquired from MetroCorp. | ||||||||||||||||||||||||||
Loans Held for Sale — Loans held for sale totaled $450.9 million and $205.0 million as of June 30, 2014 and December 31, 2013, respectively. Loans held for sale are recorded at the lower of cost or fair value. Fair value is derived from current market prices. As of June 30, 2014, the majority of the loans held for sale were student loans, which are guaranteed by the U.S. Department of Education. During the three months and six months ended June 30, 2014, net loans receivable of $27.0 million and $460.8 million were reclassified to loans held for sale. These loans were purchased by the Company with the intent to be held for investment; however, subsequent to their purchase, the Company’s intent for these loans changed and they were consequently reclassified to loans held for sale. Proceeds from sales of loans held for sale were $190.5 million and $326.3 million for the three months and six months ended June 30, 2014, respectively, resulting in net gains of $5.0 million and $8.5 million, respectively. Proceeds from sales of loans held for sale were $6.3 million for the six months ended June 30, 2013, resulting in net gains of $1 thousand. There were no sales of loans held for sale for the three months ended June 30, 2013. | ||||||||||||||||||||||||||
Credit Quality Indicators | ||||||||||||||||||||||||||
Loans are risk rated based on analysis of the current state of the borrower’s credit quality. The analysis of credit quality includes a review of all repayment sources, the borrower’s current payment performance/delinquency, current financial and liquidity status and all other relevant information. For single family residential loans, payment performance/delinquency is the driving indicator for the risk ratings. However, the risk ratings remain the overall credit quality indicator for the Company as well as the credit quality indicator utilized for estimating the appropriate allowance for loan losses. The Company utilizes an eight grade risk rating system, where a higher grade represents a higher level of credit risk. The eight grade risk rating system can be generally classified by the following categories: Pass, Watch, Special Mention, Substandard, Doubtful and Loss. The risk ratings reflect the relative strength of the repayment sources. | ||||||||||||||||||||||||||
Pass and Watch loans are generally considered to have sufficient sources of repayment in order to repay the loan in full in accordance with all terms and conditions. These borrowers may have some credit risk that requires monitoring, but full repayment is expected. Special Mention loans are considered to have potential weaknesses that warrant closer attention by management. Special Mention is considered a transitory grade. If any potential weaknesses are resolved, the loan is upgraded to a Pass or Watch grade. If negative trends in the borrower’s financial status or other information is presented that indicates the repayment sources may become inadequate, the loan is downgraded to a Substandard grade. Substandard loans are considered to have well-defined weaknesses that jeopardize the full and timely repayment of the loan. Substandard loans have a distinct possibility of loss if the deficiencies are not corrected. Additionally, when management has assessed a potential for loss but a distinct possibility of loss is not recognizable, the loan is still classified as Substandard. Doubtful loans have insufficient sources of repayment and a high probability of loss. Loss loans are considered to be uncollectible and of such little value that they are no longer considered bankable assets. These internal risk ratings are reviewed routinely and adjusted due to changes in borrower status and likelihood of loan repayment. | ||||||||||||||||||||||||||
The following tables present the credit risk rating categories for the non-covered loans by portfolio segment as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||||||||
Special | ||||||||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 3,297,111 | $ | 7,708 | $ | 11,762 | $ | — | $ | 3,316,581 | ||||||||||||||||
Multifamily | 1,075,296 | — | 57,850 | — | 1,133,146 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 5,056,988 | 74,904 | 225,774 | 1,044 | 5,358,710 | |||||||||||||||||||||
Construction | 220,057 | 6,160 | 6,888 | — | 233,105 | |||||||||||||||||||||
Land | 178,005 | 6,438 | 22,045 | — | 206,488 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 5,627,827 | 101,399 | 226,993 | 388 | 5,956,607 | |||||||||||||||||||||
Trade finance | 650,525 | 53,821 | 12,350 | — | 716,696 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 136,553 | 643 | 2,540 | — | 139,736 | |||||||||||||||||||||
Other consumer | 1,213,739 | 368 | 2,592 | — | 1,216,699 | |||||||||||||||||||||
Total | $ | 17,456,101 | $ | 251,441 | $ | 568,794 | $ | 1,432 | $ | 18,277,768 | ||||||||||||||||
Special | ||||||||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 3,167,337 | $ | 8,331 | $ | 17,207 | $ | — | $ | 3,192,875 | ||||||||||||||||
Multifamily | 923,697 | 1,634 | 67,103 | — | 992,434 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 4,032,269 | 56,752 | 212,009 | — | 4,301,030 | |||||||||||||||||||||
Construction | 127,138 | 6,160 | 6,888 | — | 140,186 | |||||||||||||||||||||
Land | 116,000 | 9,304 | 18,557 | — | 143,861 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 4,400,847 | 92,315 | 143,894 | — | 4,637,056 | |||||||||||||||||||||
Trade finance | 681,345 | 22,099 | 19,693 | — | 723,137 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 677,094 | 445 | 1,681 | — | 679,220 | |||||||||||||||||||||
Other consumer | 865,752 | 244 | 2,522 | — | 868,518 | |||||||||||||||||||||
Total | $ | 14,991,479 | $ | 197,284 | $ | 489,554 | $ | — | $ | 15,678,317 | ||||||||||||||||
Nonaccrual and Past Due Loans | ||||||||||||||||||||||||||
The following tables below present an aging analysis of the Company’s non-covered loans and loans held for sale, segregated by portfolio segment, as of June 30, 2014 and December 31, 2013. | ||||||||||||||||||||||||||
Accruing | Accruing | Total | Nonaccrual | Nonaccrual | Total | |||||||||||||||||||||
Loans | Loans | Accruing | Loans Less | Loans | Nonaccrual | Current | ||||||||||||||||||||
30-59 Days | 60-89 Days | Past Due | Than 90 Days | 90 or More | Past Due | Accruing | ||||||||||||||||||||
Past Due | Past Due | Loans | Past Due | Days Past Due | Loans | Loans | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 8,223 | $ | 743 | $ | 8,966 | $ | 2,844 | $ | 5,637 | $ | 8,481 | $ | 3,299,134 | $ | 3,316,581 | ||||||||||
Multifamily | 4,514 | 932 | 5,446 | 14,385 | 11,113 | 25,498 | 1,102,202 | 1,133,146 | ||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 18,072 | 7,619 | 25,691 | 31,025 | 12,121 | 43,146 | 5,289,873 | 5,358,710 | ||||||||||||||||||
Construction | — | — | — | — | 6,888 | 6,888 | 226,217 | 233,105 | ||||||||||||||||||
Land | 2,125 | 96 | 2,221 | 1,467 | 5,970 | 7,437 | 196,830 | 206,488 | ||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 3,047 | 4,590 | 7,637 | 7,600 | 16,151 | 23,751 | 5,925,219 | 5,956,607 | ||||||||||||||||||
Trade finance | — | — | — | — | 222 | 222 | 716,474 | 716,696 | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 599 | 643 | 1,242 | — | 2,540 | 2,540 | 135,954 | 139,736 | ||||||||||||||||||
Other consumer | 1,798 | 11 | 1,809 | 2 | 957 | 959 | 1,213,931 | 1,216,699 | ||||||||||||||||||
Loans held for sale | — | — | — | — | — | — | 450,864 | 450,864 | ||||||||||||||||||
Total (1) | $ | 38,378 | $ | 14,634 | $ | 53,012 | $ | 57,323 | $ | 61,599 | $ | 118,922 | $ | 18,556,698 | 18,728,632 | |||||||||||
Unearned fees, premiums and discounts, net | (5,589 | ) | ||||||||||||||||||||||||
Total recorded investment in non-covered loans and loans held for sale | $ | 18,723,043 | ||||||||||||||||||||||||
(1) Loans net of ASC 310-30 discount. | ||||||||||||||||||||||||||
Accruing | Accruing | Total | Nonaccrual | Nonaccrual | Total | |||||||||||||||||||||
Loans | Loans | Accruing | Loans Less | Loans | Nonaccrual | Current | ||||||||||||||||||||
30-59 Days | 60-89 Days | Past Due | Than 90 Days | 90 or More | Past Due | Accruing | ||||||||||||||||||||
Past Due | Past Due | Loans | Past Due | Days Past Due | Loans | Loans | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 4,694 | $ | 922 | $ | 5,616 | $ | — | $ | 11,218 | $ | 11,218 | $ | 3,176,041 | $ | 3,192,875 | ||||||||||
Multifamily | 8,580 | 531 | 9,111 | 19,661 | 7,972 | 27,633 | 955,690 | 992,434 | ||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 12,746 | 1,798 | 14,544 | 13,924 | 22,549 | 36,473 | 4,250,013 | 4,301,030 | ||||||||||||||||||
Construction | — | — | — | — | 6,888 | 6,888 | 133,298 | 140,186 | ||||||||||||||||||
Land | — | — | — | 265 | 3,223 | 3,488 | 140,373 | 143,861 | ||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 3,428 | 6,259 | 9,687 | 6,437 | 15,486 | 21,923 | 4,605,446 | 4,637,056 | ||||||||||||||||||
Trade finance | — | — | — | — | 909 | 909 | 722,228 | 723,137 | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 541 | 445 | 986 | — | 1,681 | 1,681 | 676,553 | 679,220 | ||||||||||||||||||
Other consumer | 293 | 1 | 294 | 175 | 1,263 | 1,438 | 866,786 | 868,518 | ||||||||||||||||||
Loans held for sale | — | — | — | — | — | — | 204,970 | 204,970 | ||||||||||||||||||
Total | $ | 30,282 | $ | 9,956 | $ | 40,238 | $ | 40,462 | $ | 71,189 | $ | 111,651 | $ | 15,731,398 | 15,883,287 | |||||||||||
Unearned fees, premiums and discounts, net | (23,672 | ) | ||||||||||||||||||||||||
Total recorded investment in non-covered loans and loans held for sale | $ | 15,859,615 | ||||||||||||||||||||||||
Loans 90 or more days past due are generally placed on nonaccrual status, at which point interest accrual is discontinued and all unpaid accrued interest is reversed against interest income. Additionally, loans that are not 90 or more days past due but have identified deficiencies, including delinquent troubled debt restructurings, are also placed on nonaccrual status. | ||||||||||||||||||||||||||
Troubled debt restructurings | ||||||||||||||||||||||||||
A troubled debt restructuring (“TDR”) is a modification of the terms of a loan when the lender, for economic or legal reasons related to the borrower’s financial difficulties, grants a concession to the borrower. The concessions may be granted in various forms, including a below-market change in the stated interest rate, reduction in the loan balance or accrued interest, extension of the maturity date with a stated interest rate lower than the current market rate or note splits referred to as A/B notes. In A/B note restructurings, the original note is bifurcated into two notes where the A note represents the portion of the original loan which allows for acceptable loan-to-value and debt coverage on the collateral and is expected to be collected in full and the B note represents the portion of the original loan where there is a shortfall in value and is fully charged-off. The A/B note balance is comprised of the A note balances only. A notes are not disclosed as TDRs in subsequent years after the year of restructuring if the restructuring agreement specifies an interest rate equal to or greater than the rate that the Bank was willing to accept at the time of the restructuring for a new loan with comparable risk, the loan is not impaired based on the terms specified by the restructuring agreement and has demonstrated a period of sustained performance under the modified terms. | ||||||||||||||||||||||||||
TDRs may be designated as performing or nonperforming. A TDR may be designated as performing if the loan has demonstrated sustained performance under the modified terms. The period of sustained performance may include the periods prior to modification if prior performance met or exceeded the modified terms. A loan will remain on nonaccrual status until the borrower demonstrates a sustained period of performance, generally six consecutive months of payments. The Company had $66.2 million and $71.8 million in total performing restructured loans as of June 30, 2014 and December 31, 2013, respectively. Nonperforming restructured loans were $25.7 million and $11.1 million as of June 30, 2014 and December 31, 2013, respectively. Included as TDRs were $3.4 million and $4.3 million of performing A/B notes as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||||||||
The following tables summarize new TDR modifications on non-covered loans portfolio and include the financial effects of these modifications for the periods presented. | ||||||||||||||||||||||||||
Loans Modified as TDRs During the Three Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Pre-Modification | Post-Modification | Pre-Modification | Post-Modification | |||||||||||||||||||||||
Number | Outstanding | Outstanding | Number | Outstanding | Outstanding | |||||||||||||||||||||
of | Recorded | Recorded | Financial | of | Recorded | Recorded | Financial | |||||||||||||||||||
Contracts | Investment | Investment (1) | Impact (2) | Contracts | Investment | Investment (1) | Impact (2) | |||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | 1 | $ | 1,032 | $ | 1,030 | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Multifamily | 1 | $ | 2,513 | $ | 2,973 | $ | — | 1 | $ | 1,093 | $ | 1,093 | $ | — | ||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 2 | $ | 5,318 | $ | 5,254 | $ | — | 4 | $ | 23,167 | $ | 22,934 | $ | 102 | ||||||||||||
Construction | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Land | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 2 | $ | 1,165 | $ | 1,155 | $ | 563 | 3 | $ | 1,204 | $ | 1,201 | $ | 86 | ||||||||||||
Trade finance | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Other consumer | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Loans Modified as TDRs During the Six Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Pre-Modification | Post-Modification | Pre-Modification | Post-Modification | |||||||||||||||||||||||
Number | Outstanding | Outstanding | Number | Outstanding | Outstanding | |||||||||||||||||||||
of | Recorded | Recorded | Financial | of | Recorded | Recorded | Financial | |||||||||||||||||||
Contracts | Investment | Investment (1) | Impact (2) | Contracts | Investment | Investment (1) | Impact (2) | |||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | 4 | $ | 6,855 | $ | 5,105 | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Multifamily | 1 | $ | 2,513 | $ | 2,973 | $ | — | 1 | $ | 1,093 | $ | 1,093 | $ | — | ||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 2 | $ | 5,318 | $ | 5,254 | $ | — | 4 | $ | 23,167 | $ | 22,934 | $ | 102 | ||||||||||||
Construction | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Land | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 7 | $ | 2,886 | $ | 2,828 | $ | 1,811 | 4 | $ | 1,246 | $ | 1,241 | $ | 86 | ||||||||||||
Trade finance | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Other consumer | — | $ | — | $ | — | $ | — | 1 | $ | 651 | $ | 649 | $ | — | ||||||||||||
(1) Includes subsequent payments after modification and reflects the balance as of June 30, 2014 and June 30, 2013. | ||||||||||||||||||||||||||
(2) The financial impact includes charge-offs and specific reserves recorded at modification date. | ||||||||||||||||||||||||||
Potential TDRs are individually evaluated and the type of restructuring is selected based on the loan type and the circumstances of the borrower’s financial difficulty in order to maximize the Bank’s recovery. Residential TDRs were restructured through extensions, interest rate reductions, principal deferments, and other modified terms, for a total of $8.1 million as of June 30, 2014. Commercial real estate TDRs were restructured through principal and interest reductions and principal, for a total of $5.3 million as of June 30, 2014. Commercial and industrial TDRs were restructured through extensions, principal deferment, and other modified terms, for a total of $2.8 million as of June 30, 2014. These modifications had an impact of a reduction or deferment of principal and/or interest collected over the life of the loan, and/or an extended time period of collection of principal and/or interest. | ||||||||||||||||||||||||||
Modifications of residential TDRs primarily included A/B note splits, which result in a partial charge-off or loss for the Bank at the modification date. Residential TDRs modified using A/B note splits totaled $1.1 million as of June 30, 2013. Commercial real estate TDRs were primarily modified through, A/B note splits, forbearance of payments and principal and/or interest deferment, for a total of $22.9 million as of June 30, 2013. Modifications of commercial and industrial TDRs were restructured through principal and interest reduction, for a total of $1.2 million as of June 30, 2013. Consumer TDRs were restructured through maturity extensions, for a total of $649 thousand as of June 30, 2013. | ||||||||||||||||||||||||||
Performing TDRs at June 30, 2014 were comprised of $17.4 million in residential loans, $31.6 million in commercial real estate loans, $16.4 million in commercial and industrial loans, and $758 thousand in consumer loans. Performing TDRs at December 31, 2013 were comprised of $37.6 million in commercial real estate loans, $17.4 million in residential loans, $16.7 million in commercial and industrial loans and $108 thousand in consumer loans. Nonperforming TDRs at June 30, 2014 were comprised of $9.0 million in residential loans, $11.3 million in commercial real estate loans, $5.4 million in commercial and industrial loans and no consumer loans. Nonperforming TDRs at December 31, 2013 were comprised of $3.6 million in residential loans, $3.4 million in commercial real estate loans, $3.5 million in commercial and industrial loans, and $639 thousand in consumer loans. | ||||||||||||||||||||||||||
Loans Modified as TDRs that Subsequently Defaulted | ||||||||||||||||||||||||||
During the Three Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Number of | Recorded | Number of | Recorded | |||||||||||||||||||||||
Contracts | Investment | Contracts | Investment | |||||||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | — | $ | — | 1 | $ | 105 | ||||||||||||||||||||
Multifamily | — | $ | — | — | $ | — | ||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | — | $ | — | — | $ | — | ||||||||||||||||||||
Construction | — | $ | — | — | $ | — | ||||||||||||||||||||
Land | — | $ | — | — | $ | — | ||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 1 | $ | 500 | — | $ | — | ||||||||||||||||||||
Trade finance | — | $ | — | — | $ | — | ||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | — | $ | — | ||||||||||||||||||||
Other consumer | — | $ | — | — | $ | — | ||||||||||||||||||||
Loans Modified as TDRs that Subsequently Defaulted | ||||||||||||||||||||||||||
During the Six Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Number of | Recorded | Number of | Recorded | |||||||||||||||||||||||
Contracts | Investment | Contracts | Investment | |||||||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | — | $ | — | 3 | $ | 2,935 | ||||||||||||||||||||
Multifamily | — | $ | — | — | $ | — | ||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 1 | $ | 2,730 | — | $ | — | ||||||||||||||||||||
Construction | — | $ | — | — | $ | — | ||||||||||||||||||||
Land | — | $ | — | — | $ | — | ||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 1 | $ | 500 | 2 | $ | 500 | ||||||||||||||||||||
Trade finance | — | $ | — | — | $ | — | ||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | — | $ | — | ||||||||||||||||||||
Other consumer | — | $ | — | — | $ | — | ||||||||||||||||||||
TDRs are included in the impaired loan quarterly valuation allowance process. See the sections below Impaired Loans and Allowance for Loan Losses for the complete discussion. All portfolio segments of TDRs are reviewed for necessary specific reserves in the same manner as impaired loans of the same portfolio segment which have not been identified as TDRs. The modification of the terms of each TDR is considered in the current impairment analysis of the respective TDR. For all portfolio segments of delinquent TDRs, when the restructured loan is uncollectible and its fair value is less than the recorded investment in the loan, the deficiency is charged-off against the allowance for loan losses. If the loan is a performing TDR, the deficiency is included in the specific allowance, as appropriate. As of June 30, 2014, the allowance for loan losses associated with TDRs was $14.9 million for performing TDRs and $3.0 million for nonperforming TDRs. As of December 31, 2013, the allowance for loan losses associated with TDRs was $13.0 million for performing TDRs and $836 thousand for nonperforming TDRs. | ||||||||||||||||||||||||||
Impaired Loans | ||||||||||||||||||||||||||
A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all scheduled payments of principal or interest due according to the original contractual terms of the loan agreement. The Bank’s loans are grouped into heterogeneous and homogeneous (mostly consumer loans) categories. Classified loans (graded Substandard or Doubtful) in the heterogeneous category are selected and evaluated for impairment on an individual basis. The Bank considers loans individually reviewed to be impaired if, based on current information and events, it is probable the Bank will not be able to collect all amounts due according to the original contractual terms of the loan agreement. Impaired loans are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or, as an expedient, at the loan’s observable market price or the fair value of the collateral if the loan is collateral dependent, less costs to sell. When the value of an impaired loan is less than the recorded investment in the loan and the loan is classified as nonperforming and uncollectible, the deficiency is charged-off against the allowance for loan losses. Impaired loans exclude the homogenous consumer loan portfolio which is evaluated collectively for impairment. Impaired loans include non-covered loans held for investment on nonaccrual status, regardless of the collateral coverage, and loans modified in a TDR. | ||||||||||||||||||||||||||
At June 30, 2014 and December 31, 2013, impaired non-covered loans totaled $169.0 million and $183.5 million, respectively. Impaired non-covered loans as of June 30, 2014 and December 31, 2013 are set forth in the following tables. | ||||||||||||||||||||||||||
Recorded | Recorded | |||||||||||||||||||||||||
Unpaid | Investment | Investment | Total | |||||||||||||||||||||||
Principal | With No | With | Recorded | Related | ||||||||||||||||||||||
Balance | Allowance | Allowance | Investment (1) | Allowance | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 16,220 | $ | 13,427 | $ | 1,067 | $ | 14,494 | $ | 192 | ||||||||||||||||
Multifamily | 39,108 | 27,617 | 9,139 | 36,756 | 1,185 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 65,663 | 39,638 | 18,135 | 57,773 | 2,555 | |||||||||||||||||||||
Construction | 6,888 | 6,888 | — | 6,888 | — | |||||||||||||||||||||
Land | 17,059 | 4,217 | 7,865 | 12,082 | 1,991 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 54,236 | 10,497 | 29,182 | 39,679 | 18,645 | |||||||||||||||||||||
Trade finance | 529 | 256 | 273 | 529 | 273 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Other consumer | 763 | 763 | — | 763 | — | |||||||||||||||||||||
Total | $ | 200,466 | $ | 103,303 | $ | 65,661 | $ | 168,964 | $ | 24,841 | ||||||||||||||||
Recorded | Recorded | |||||||||||||||||||||||||
Unpaid | Investment | Investment | Total | |||||||||||||||||||||||
Principal | With No | With | Recorded | Related | ||||||||||||||||||||||
Balance | Allowance | Allowance | Investment (1) | Allowance | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
As of December 31, 2013 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 15,814 | $ | 13,585 | $ | 1,588 | $ | 15,173 | $ | 207 | ||||||||||||||||
Multifamily | 43,821 | 30,899 | 10,215 | 41,114 | 1,339 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 73,777 | 39,745 | 25,523 | 65,268 | 5,976 | |||||||||||||||||||||
Construction | 6,888 | 6,888 | — | 6,888 | — | |||||||||||||||||||||
Land | 17,390 | 4,372 | 7,908 | 12,280 | 2,082 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 48,482 | 10,850 | 27,487 | 38,337 | 13,787 | |||||||||||||||||||||
Trade finance | 2,771 | 438 | 752 | 1,190 | 752 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 1,749 | 1,681 | — | 1,681 | — | |||||||||||||||||||||
Other consumer | 1,945 | 1,546 | — | 1,546 | — | |||||||||||||||||||||
Total | $ | 212,637 | $ | 110,004 | $ | 73,473 | $ | 183,477 | $ | 24,143 | ||||||||||||||||
(1) Excludes $14.3 million and $17.7 million of covered non-accrual loans at June 30, 2014 and December 31, 2013, respectively, accounted for under ASC 310-10, of which some loans have additional partial balances accounted for under ASC 310-30. | ||||||||||||||||||||||||||
The following tables provide the average recorded investment in impaired loans and the amount of interest income recognized on impaired loans by portfolio segment: | ||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
Average | Recognized | Average | Recognized | Average | Recognized | Average | Recognized | |||||||||||||||||||
recorded | interest | recorded | interest | recorded | interest | recorded | interest | |||||||||||||||||||
investment | income (1) | investment | income (1) | investment | income (1) | investment | income (1) | |||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 15,131 | $ | 65 | $ | 11,219 | $ | 38 | $ | 14,034 | $ | 115 | $ | 11,497 | $ | 77 | ||||||||||
Multifamily | 36,683 | 184 | 45,230 | 247 | 36,817 | 360 | 45,407 | 456 | ||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 59,121 | 303 | 57,105 | 1,529 | 59,917 | 627 | 58,098 | 1,738 | ||||||||||||||||||
Construction | 6,888 | — | 6,888 | — | 6,888 | — | 6,888 | — | ||||||||||||||||||
Land | 12,128 | 75 | 13,231 | 124 | 12,179 | 149 | 13,285 | 247 | ||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 41,592 | 211 | 23,448 | 59 | 42,682 | 414 | 24,200 | 104 | ||||||||||||||||||
Trade finance | 546 | 4 | 2,052 | 4 | 559 | 8 | 2,367 | 7 | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Other consumer | 755 | 13 | 1,555 | 7 | 752 | 14 | 1,597 | 14 | ||||||||||||||||||
Total impaired loans (excluding PCI) | $ | 172,844 | $ | 855 | $ | 160,728 | $ | 2,008 | $ | 173,828 | $ | 1,687 | $ | 163,339 | $ | 2,643 | ||||||||||
(1) Includes interest recognized on accruing TDRs. Interest payments received on nonaccrual loans are generally reflected as a reduction of principal and not as interest income. | ||||||||||||||||||||||||||
Allowance for Loan Losses | ||||||||||||||||||||||||||
The allowance consists of specific reserves and a general reserve. The Bank’s loans fall into heterogeneous and homogeneous (mostly consumer loans) categories. Impaired loans are subject to specific reserves. Loans in the homogeneous category, as well as non-impaired loans in the heterogeneous category, are evaluated as part of the general reserve. The general reserve is calculated by utilizing both quantitative and qualitative factors. There are different qualitative risks for the loans in each portfolio segment. As of June 30, 2014, the Residential and CRE segments’ predominant risk characteristic is the collateral and the geographic location of the property collateralizing the loan. The risk is qualitatively assessed based on the change in the real estate market in those geographic areas. The C&I segment’s predominant risk characteristics are the global cash flows of the borrowers and guarantors, and economic and market conditions. Consumer loans, excluding the student loan portfolio guaranteed by the U.S. Department of Education, are largely comprised of home equity lines of credit, for which the predominant risk characteristic is the real estate collateral securing the loans. | ||||||||||||||||||||||||||
Our methodology to determine the overall appropriateness of the allowance is based on a classification migration model and qualitative considerations. The migration analysis examines pools of loans having similar characteristics and analyzes their loss rates over a historical period. We utilize historical loss factors derived from trends and losses associated with each pool over a specified period of time. Based on this process, we assign loss factors to each loan grade within each pool of loans. Loss rates derived by the migration model are based predominantly on historical loss trends that may not be entirely indicative of the actual or inherent loss potential. As such, we utilize qualitative and environmental factors as adjusting mechanisms to supplement the historical results of the classification migration model. Qualitative considerations include, but are not limited to, prevailing economic or market conditions, relative risk profiles of various loan segments, volume concentrations, growth trends, delinquency and nonaccrual status, problem loan trends, and geographic concentrations. Qualitative and environmental factors are reflected as percentage adjustments and are added to the historical loss rates derived from the classified asset migration model to determine the appropriate allowance for each loan pool. | ||||||||||||||||||||||||||
When determined uncollectible, it is the Company’s policy to promptly charge-off the difference in the outstanding loan balance and the fair value of the collateral. Recoveries are recorded when payment is received on loans that were previously charged-off through the allowance for loan losses. Allocation of a portion of the allowance to one segment of the loan portfolio does not preclude its availability to absorb losses in other segments. | ||||||||||||||||||||||||||
The following tables present a summary of the activity in the allowance for loan losses on the non-covered loans for the periods indicated. | ||||||||||||||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||||||||||||||
Beginning balance | $ | 47,827 | $ | 62,739 | $ | 124,201 | $ | 10,851 | $ | — | $ | 245,618 | ||||||||||||||
Provision for loan losses | (2,046 | ) | (1,376 | ) | 10,784 | 753 | 829 | 8,944 | ||||||||||||||||||
Provision allocation for unfunded loan commitments and letters of credit | — | — | — | — | (829 | ) | (829 | ) | ||||||||||||||||||
Charge-offs | (61 | ) | (1,314 | )(1) | (6,899 | ) | (2 | ) | — | (8,276 | ) | |||||||||||||||
Recoveries | 63 | 551 | 393 | 4 | — | 1,011 | ||||||||||||||||||||
Net recoveries/(charge-offs) | 2 | (763 | ) | (6,506 | ) | 2 | — | (7,265 | ) | |||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,377 | $ | 4,546 | $ | 18,918 | $ | — | $ | — | $ | 24,841 | ||||||||||||||
Collectively evaluated for impairment | 44,406 | 55,684 | 109,561 | 11,606 | 221,257 | |||||||||||||||||||||
Acquired with deteriorated credit quality | — | 370 | — | — | — | 370 | ||||||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Three Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Beginning balance | $ | 46,880 | $ | 72,958 | $ | 102,346 | $ | 6,612 | $ | — | $ | 228,796 | ||||||||||||||
Provision for loan losses | 704 | (426 | ) | 6,241 | 2,190 | (432 | ) | 8,277 | ||||||||||||||||||
Provision allocation for unfunded loan commitments and letters of credit | — | — | — | — | 432 | 432 | ||||||||||||||||||||
Charge-offs | (550 | ) | (762 | ) | (3,816 | ) | (865 | ) | — | (5,993 | ) | |||||||||||||||
Recoveries | 303 | 1,060 | 605 | — | — | 1,968 | ||||||||||||||||||||
Net (charge-offs)/recoveries | (247 | ) | 298 | (3,211 | ) | (865 | ) | — | (4,025 | ) | ||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,508 | $ | 7,931 | $ | 3,708 | $ | — | $ | — | $ | 13,147 | ||||||||||||||
Collectively evaluated for impairment | 45,829 | 64,899 | 101,668 | 7,937 | — | 220,333 | ||||||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Six Months Ended June 30, 2014 | ||||||||||||||||||||||||||
Beginning balance | $ | 50,717 | $ | 64,677 | $ | 115,184 | $ | 11,352 | $ | — | $ | 241,930 | ||||||||||||||
Provision for loan losses | (4,790 | ) | (3,823 | ) | 24,215 | 252 | 1,044 | 16,898 | ||||||||||||||||||
Allowance for unfunded loan commitments and letters of credit | — | — | — | — | (1,044 | ) | (1,044 | ) | ||||||||||||||||||
Charge-offs | (343 | ) | (1,634 | )(1) | (12,224 | ) | (5 | ) | — | (14,206 | ) | |||||||||||||||
Recoveries | 199 | 1,380 | 1,304 | 7 | — | 2,890 | ||||||||||||||||||||
Net (charge-offs)/recoveries | (144 | ) | (254 | ) | (10,920 | ) | 2 | — | (11,316 | ) | ||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,377 | $ | 4,546 | $ | 18,918 | $ | — | $ | — | $ | 24,841 | ||||||||||||||
Collectively evaluated for impairment | 44,406 | 55,684 | 109,561 | 11,606 | — | 221,257 | ||||||||||||||||||||
Acquired with deteriorated credit quality | — | 370 | — | — | — | 370 | ||||||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Six Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Beginning balance | $ | 49,349 | $ | 69,856 | $ | 105,376 | $ | 4,801 | $ | — | $ | 229,382 | ||||||||||||||
Provision for loan losses | (2,222 | ) | 3,392 | 3,941 | 3,552 | (1,148 | ) | 7,515 | ||||||||||||||||||
Allowance for unfunded loan commitments and letters of credit | — | — | — | — | 1,148 | 1,148 | ||||||||||||||||||||
Charge-offs | (861 | ) | (1,767 | ) | (5,077 | ) | (1,211 | ) | — | (8,916 | ) | |||||||||||||||
Recoveries | 1,071 | 1,349 | 1,136 | 795 | — | 4,351 | ||||||||||||||||||||
Net recoveries/(charge-offs) | 210 | (418 | ) | (3,941 | ) | (416 | ) | — | (4,565 | ) | ||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,508 | $ | 7,931 | $ | 3,708 | $ | — | $ | — | $ | 13,147 | ||||||||||||||
Collectively evaluated for impairment | 45,829 | 64,899 | 101,668 | 7,937 | — | 220,333 | ||||||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
(1) Includes charge-off of $523 thousand relating to PCI loans acquired from MetroCorp. | ||||||||||||||||||||||||||
The Company’s recorded investments in total non-covered loans receivable as of June 30, 2014 and December 31, 2013 related to each balance in the allowance for loan losses by portfolio segment and disaggregated on the basis of the Company’s impairment methodology is as follows: | ||||||||||||||||||||||||||
Residential | CRE | C&I | Consumer | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 51,250 | $ | 76,743 | $ | 40,208 | $ | 763 | $ | 168,964 | ||||||||||||||||
Collectively evaluated for impairment | 4,397,218 | 5,665,843 | 6,631,178 | 1,355,672 | 18,049,911 | |||||||||||||||||||||
Acquired with deteriorated credit quality | 1,259 | 55,717 | 1,917 | — | 58,893 | |||||||||||||||||||||
Ending balance | $ | 4,449,727 | $ | 5,798,303 | $ | 6,673,303 | $ | 1,356,435 | $ | 18,277,768 | ||||||||||||||||
Residential | CRE | C&I | Consumer | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 56,287 | $ | 84,436 | $ | 39,527 | $ | 3,227 | $ | 183,477 | ||||||||||||||||
Collectively evaluated for impairment | 4,129,022 | 4,500,641 | 5,320,666 | 1,544,511 | 15,494,840 | |||||||||||||||||||||
Ending balance | $ | 4,185,309 | $ | 4,585,077 | $ | 5,360,193 | $ | 1,547,738 | $ | 15,678,317 | ||||||||||||||||
Allowance for Unfunded Loan Commitments, Off-Balance Sheet Credit Exposures and Recourse Provisions | ||||||||||||||||||||||||||
The allowance for unfunded loan commitments, off-balance sheet credit exposures, and recourse provisions is maintained at a level believed by management to be sufficient to absorb estimated probable losses related to these unfunded credit facilities. The determination of the adequacy of the allowance is based on periodic evaluations of the unfunded credit facilities including an assessment of the probability of commitment usage, credit risk factors for loans outstanding to these same customers, and the terms and expiration dates of the unfunded credit facilities. As of June 30, 2014 and December 31, 2013, the allowance for unfunded loan commitments, off-balance sheet credit exposures, and recourse provisions amounted to $12.3 million and $11.3 million, respectively. Net adjustments to the allowance for unfunded loan commitments, off-balance sheet credit exposures, and recourse provisions are included in the provision for loan losses. | ||||||||||||||||||||||||||
Loans serviced for others amounted to $1.21 billion and $1.35 billion at June 30, 2014 and December 31, 2013, respectively. These represent loans that have either been sold or securitized for which the Bank continues to provide servicing or has limited recourse. The majority of these loans are residential and CRE at June 30, 2014 and December 31, 2013. Of the total allowance for unfunded loan commitments, off-balance sheet credit exposures, and recourse provisions, $2.6 million and $3.2 million pertain to these loans as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||||||||
Accretable Yield | ||||||||||||||||||||||||||
The following tables summarize the changes in the accretable yield for the PCI loans acquired from MetroCorp for the three and six months ended June 30, 2014. | ||||||||||||||||||||||||||
Three | Six | |||||||||||||||||||||||||
Months Ended | Months Ended | |||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Balance at beginning of period | $ | 6,452 | $ | — | ||||||||||||||||||||||
Additions | — | 6,745 | ||||||||||||||||||||||||
Accretion | (1,509 | ) | (2,265 | ) | ||||||||||||||||||||||
Changes in expected cash flows | 824 | 1,287 | ||||||||||||||||||||||||
Balance at end of period | $ | 5,767 | $ | 5,767 |
AFFORDABLE_HOUSING_PARTNERSHIP
AFFORDABLE HOUSING PARTNERSHIPS AND OTHER INVESTMENTS | 6 Months Ended |
Jun. 30, 2014 | |
AFFORDABLE HOUSING PARTNERSHIPS AND OTHER INVESTMENTS | ' |
AFFORDABLE HOUSING PARTNERSHIPS AND OTHER INVESTMENTS | ' |
NOTE 10 —AFFORDABLE HOUSING PARTNERSHIPS AND OTHER INVESTMENTS | |
The Company invests in certain limited partnerships that are formed to develop and operate apartment complexes designed as high-quality affordable housing for lower income tenants throughout the United States. The Company’s ownership amount in each limited partnership varies. Each of the partnerships must meet the regulatory requirements for affordable housing for a minimum 15-year compliance period to fully utilize the tax credits. The Company is not the primary beneficiary and, therefore, not required to consolidate these entities. Depending on the ownership percentage and the influence the Company has on the limited partnership, the Company uses either the equity method or cost method of accounting. If the partnerships cease to qualify during the compliance period, the credits may be denied for any period in which the projects are not in compliance and a portion of the credits previously taken may be subject to recapture with interest. The balance of the investments in these entities was $181.9 million and $164.8 million at June 30, 2014 and December 31, 2013, respectively. | |
The Company also invests in certain limited partnerships that qualify for Community Reinvestment Act (“CRA”) credits or that qualify for other types of tax credits. The Community Reinvestment Act encourages banks to meet the credit needs of their communities for housing and other purposes, particularly in neighborhoods with low or moderate incomes. The balance of CRA and other investments was $90.7 million and $70.2 million at June 30, 2014 and December 31, 2013, respectively, and is included in other assets in the consolidated balance sheets. | |
The Company has unfunded commitments related to the affordable housing and other investments that are payable on demand. Total unfunded commitments for these investments were $86.6 million and $73.1 million at June 30, 2014 and December 31, 2013, respectively, and are recorded in accrued expenses and other liabilities in the consolidated balance sheets. |
GOODWILL_AND_OTHER_INTANGIBLE_
GOODWILL AND OTHER INTANGIBLE ASSETS | 6 Months Ended | ||||
Jun. 30, 2014 | |||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | ||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | ||||
NOTE 11 — GOODWILL AND OTHER INTANGIBLE ASSETS | |||||
Goodwill | |||||
The carrying amount of goodwill as of June 30, 2014 and December 31, 2013 was $458.5 million and $337.4 million, respectively. Goodwill increased by $121.0 million as a result of the acquisition of MetroCorp on January 17, 2014 as discussed in Note 3 to the Company’s consolidated financial statements. | |||||
Goodwill is tested for impairment on an annual basis as of December 31, or more frequently as events occur, or as current circumstances and conditions warrant. The Company records impairment write-downs as charges to noninterest expense and adjustments to the carrying value of goodwill. Subsequent reversals of goodwill impairment are prohibited. | |||||
As of June 30, 2014, the Company’s market capitalization based on total outstanding common shares was $5.02 billion and its total stockholders’ equity was $2.70 billion. The Company performed its annual impairment test as of December 31, 2013 to determine whether and to what extent, if any, recorded goodwill was impaired. The analysis compared the fair value of each of the reporting units, including goodwill, to the respective carrying amounts. If the carrying amount of the reporting unit, including goodwill, exceeds the fair value of that reporting unit, then further testing for goodwill impairment is performed. | |||||
Premiums on Acquired Deposits | |||||
Premiums on acquired deposits represent the intangible value of depositor relationships resulting from deposit liabilities assumed in various acquisitions. These intangibles are tested for impairment on an annual basis, or more frequently as events occur, or as current circumstances and conditions warrant. As of June 30, 2014 and December 31, 2013, the gross carrying amount of premiums on acquired deposits was $108.8 million and $100.2 million, respectively. A premium on acquired deposits of $8.6 million was recorded due to the acquisition of MetroCorp as discussed in further detail in Note 3 to the Company’s consolidated financial statements. As of June 30, 2014 and December 31, 2013, accumulated amortization totaled $58.4 million and $53.3 million, respectively. | |||||
The Company amortizes premiums on acquired deposits based on the projected useful lives of the related deposits. Amortization expense of premiums on acquired deposits was $2.6 million and $2.4 million for the three months ended June 30, 2014 and 2013, respectively. Amortization expense of premiums on acquired deposits was $5.1 million and $4.8 million for the six months ended June 30, 2014 and 2013, respectively. | |||||
The following table provides the estimated future amortization expense of premiums on acquired deposits for the succeeding five years and thereafter: | |||||
Amount | |||||
(In thousands) | |||||
Estimated Amortization Expense of Premiums on Acquired Deposits | |||||
Six Months Ending December 31, 2014 | $ | 5,080 | |||
Year Ending December 31, 2015 | 9,234 | ||||
Year Ending December 31, 2016 | 8,086 | ||||
Year Ending December 31, 2017 | 6,935 | ||||
Year Ending December 31, 2018 | 5,883 | ||||
Thereafter | 15,171 | ||||
Total | $ | 50,389 |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2014 | |
COMMITMENTS AND CONTINGENCIES. | ' |
COMMITMENTS AND CONTINGENCIES | ' |
NOTE 12 — COMMITMENTS AND CONTINGENCIES | |
Credit Extensions — In the normal course of business, the Company has various outstanding commitments to extend credit that are not reflected in the accompanying consolidated financial statements. As of June 30, 2014 and December 31, 2013, undisbursed loan commitments amounted to $4.40 billion and $4.02 billion, respectively. Commercial and standby letters of credit amounted to $1.13 billion and $1.16 billion as of June 30, 2014 and December 31, 2013, respectively. | |
Guarantees — From time to time, the Company sells or securitizes loans with recourse in the ordinary course of business. For loans that have been sold or securitized with recourse, the recourse component is considered a guarantee. When the Company sells or securitizes a loan with recourse, it commits to stand ready to perform if the loan defaults and to make payments to remedy the default. As of June 30, 2014, total loans sold or securitized with recourse amounted to $294.2 million and were comprised of $38.1 million in single-family loans with full recourse and $256.1 million in multifamily loans with limited recourse. In comparison, total loans sold or securitized with recourse amounted to $338.8 million at December 31, 2013, which comprised of $42.2 million in single-family loans with full recourse and $296.6 million in multifamily loans with limited recourse. The recourse provision on multifamily loans varies by loan sale and is limited to 4% of the top loss on the underlying loans. The Company’s recourse reserve related to loan sales and securitizations totaled $2.6 million as of June 30, 2014 and $3.2 million as of December 31, 2013, and is included in accrued expenses and other liabilities in the accompanying consolidated balance sheets. The Company continues to experience minimal losses from the single-family and multifamily loan portfolios. | |
The Company also sells or securitizes loans without recourse that may have to be subsequently repurchased if a defect that occurred during the loan origination process results in a violation of a representation or warranty made in connection with the securitization or sale of the loan. When a loan that is sold or securitized to an investor without recourse fails to perform according to its contractual terms, the investor will typically review the loan file to determine whether defects in the origination process occurred and if such defects give rise to a violation of a representation or warranty made to the investor in connection with the sale or securitization. If such a defect is identified, the Company may be required to either repurchase the loan or indemnify the investor for losses sustained. If there are no such defects, the Company has no commitment to repurchase the loan. As of June 30, 2014 and December 31, 2013, the amount of loans sold without recourse totaled $735.9 million and $818.2 million, respectively. Total loans securitized without recourse amounted to $177.7 million and $193.8 million, at June 30, 2014 and December 31, 2013, respectively. The loans sold or securitized without recourse represent the unpaid principal balance of the Company’s loans serviced for others portfolio. | |
Litigation — Neither the Company nor the Bank is involved in any material legal proceedings at June 30, 2014. Certain lawsuits and claims arising in the ordinary course of business have been filed or are pending against us or our affiliates. Where appropriate, we establish reserves in accordance with ASC 450, Contingencies. The outcome of litigation and other legal and regulatory matters is inherently uncertain, and it is possible that one or more of the legal or regulatory matters, if any, currently pending or threatened could have a material adverse effect on our liquidity, consolidated financial position, and/or results of operations. | |
Other Commitments — The Company has commitments to invest in affordable housing funds, and other investments qualifying for community reinvestment credits and other tax credits. These commitments are payable on demand. As of June 30, 2014 and December 31, 2013, these commitments were $86.6 million and $73.1 million, respectively. These commitments are recorded in accrued expenses and other liabilities in the consolidated balance sheet. |
STOCKHOLDERS_EQUITY_AND_EARNIN
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE | ' | |||||||||||||||||||
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE | ' | |||||||||||||||||||
NOTE 13 — STOCKHOLDERS’ EQUITY AND EARNINGS PER SHARE | ||||||||||||||||||||
Series A Preferred Stock Offering — In April 2008, the Company issued 200,000 shares of 8% Non-Cumulative Perpetual Convertible Preferred Stock, Series A (“Series A”), with a liquidation preference of $1,000 per share. The Company received $194.1 million of additional Tier 1 qualifying capital, after deducting stock issuance costs. On May 1, 2013, the Company exercised its mandatory conversion right related to all the outstanding shares of its Series A preferred stock. At the conversion date, the remaining 85,710 shares of outstanding Series A Preferred Stock were converted to 5,594,080 shares of common stock. | ||||||||||||||||||||
MetroCorp Acquisition — On January 17, 2014, the Company completed the acquisition of MetroCorp. The final consideration included 5,583,093 shares of East West common stock and $89.4 million of cash. Prior to the acquisition, MetroCorp had an outstanding warrant to purchase 771,429 shares of its common stock. After acquisition and as of June 30, 2014, the rights of the warrant holder were converted into the right to acquire 230,282 shares of the Company’s common stock. | ||||||||||||||||||||
Stock Repurchase Program — On July 17, 2013, the Company’s Board of Directors authorized a new stock repurchase program to buy back up to $100.0 million of its common stock. The Company did not repurchase any shares under this program during the three and six months period ended June 30, 2014. In comparison, the Company repurchased 8,026,807 shares at a weighted average price of $24.89 per share for a total cost of $200.0 million as of June 30, 2013. | ||||||||||||||||||||
Quarterly Dividends — In April 2014, the Company’s Board of Directors declared quarterly common stock cash dividends of $0.18 per share payable on or about May 19, 2014 to shareholders of record on May 2, 2014. Cash dividends totaling $26.0 million and $52.0 million were paid to the Company’s common shareholders during the three and six months ended June 30, 2014. | ||||||||||||||||||||
Earnings Per Share (“EPS”) — The number of shares outstanding at June 30, 2014 was 143,389,155. Certain of the Company’s instruments containing rights to nonforfeitable dividends granted in stock-based payment transactions are considered participating securities prior to vesting and, therefore, have been included in the earnings allocations in computing basic and diluted EPS under the two-class method. Basic EPS was computed by dividing net income, net of income allocated to participating securities, by the weighted-average number of common shares outstanding during each period, net of treasury shares and including vested but unissued shares and share units. The computation of diluted EPS reflects the additional dilutive effect of stock options and unvested stock awards | ||||||||||||||||||||
The following table sets forth earnings per share calculations for the three and six months ended June 30, 2014 and 2013: | ||||||||||||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 83,988 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | — | |||||||||||||||||||
Earnings allocated to participating securities | (119 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 83,869 | 143,187 | $ | 0.59 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 75 | ||||||||||||||||||
Restricted stock units | 51 | 284 | ||||||||||||||||||
Convertible preferred stock | — | — | ||||||||||||||||||
Warrants | — | 143 | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 83,920 | 143,689 | $ | 0.58 | |||||||||||||||
Three Months Ended June 30, 2013 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 74,015 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | (1,714 | ) | ||||||||||||||||||
Earnings allocated to participating securities | (400 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 71,901 | 137,536 | $ | 0.52 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 59 | ||||||||||||||||||
Restricted stock units | 33 | 221 | ||||||||||||||||||
Convertible preferred stock | — | — | ||||||||||||||||||
Warrants | — | — | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 71,934 | 137,816 | $ | 0.52 | |||||||||||||||
Six Months Ended June 30, 2014 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 160,729 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | — | |||||||||||||||||||
Earnings allocated to participating securities | (287 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 160,442 | 142,578 | $ | 1.13 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 77 | ||||||||||||||||||
Restricted stock units | 129 | 359 | ||||||||||||||||||
Convertible preferred stock | — | — | ||||||||||||||||||
Warrants | — | 144 | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 160,571 | 143,158 | $ | 1.12 | |||||||||||||||
Six Months Ended June 30, 2013 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 146,106 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | (3,428 | ) | ||||||||||||||||||
Earnings allocated to participating securities | (988 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 141,690 | 137,592 | $ | 1.03 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 55 | ||||||||||||||||||
Restricted stock units | 68 | 227 | ||||||||||||||||||
Convertible preferred stock | 3,428 | 3,699 | ||||||||||||||||||
Warrants | — | — | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 145,186 | 141,573 | $ | 1.03 | |||||||||||||||
The following average outstanding stock options and restricted stock units for the three and six months ended June 30, 2014 and 2013, respectively, were excluded from the computation of diluted EPS because including them would have had an antidilutive effect. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Convertible preferred stock | — | 1,841 | — | — | ||||||||||||||||
Stock options | — | 159 | 40 | 214 | ||||||||||||||||
Restricted stock units | 2 | 6 | 61 | 4 | ||||||||||||||||
Accumulated Other Comprehensive (Loss) Income — As of June 30, 2014, total accumulated other comprehensive loss was $2.6 million which includes the following components: net unrealized loss on securities available for sale of $2.6 million and unrealized gain on other investments of $58 thousand. As of December 31, 2013, total accumulated other comprehensive loss was $30.5 million which includes the following components: net unrealized loss on securities available for sale of $30.5 million and unrealized gains on other investments of $79 thousand. | ||||||||||||||||||||
The cumulative other comprehensive income (loss) balances were as follows: | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Cumulative | Cumulative | |||||||||||||||||||
Investment | Other | Investment | Other | |||||||||||||||||
Securities | Other | Comprehensive | Securities | Other | Comprehensive | |||||||||||||||
Available-for-Sale | Investments | Income | Available-for-Sale | Investments | Income | |||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
Balance, beginning of the period | $ | (17,099 | ) | $ | 62 | $ | (17,037 | ) | $ | 6,149 | $ | 36 | $ | 6,185 | ||||||
Net unrealized gains (losses) arising during period | 14,895 | (4 | ) | 14,891 | (24,770 | ) | 7 | (24,763 | ) | |||||||||||
Less: reclassification adjustment for gains included in net income | (389 | ) | — | $ | (389 | ) | (3,100 | ) | — | (3,100 | ) | |||||||||
Net unrealized gains (losses) | 14,506 | (4 | ) | 14,502 | (27,870 | ) | 7 | (27,863 | ) | |||||||||||
Balance, end of the period | $ | (2,593 | ) | $ | 58 | $ | (2,535 | ) | $ | (21,721 | ) | $ | 43 | $ | (21,678 | ) | ||||
Six Months Ended June 30, | ||||||||||||||||||||
Balance, beginning of the period | $ | (30,538 | ) | 79 | $ | (30,459 | ) | $ | 4,643 | $ | 26 | $ | 4,669 | |||||||
Net unrealized gains (losses) arising during period | 30,317 | (21 | ) | 30,296 | (20,029 | ) | 17 | (20,012 | ) | |||||||||||
Less: reclassification adjustment for gains included in net income | (2,372 | ) | — | (2,372 | ) | (6,335 | ) | — | (6,335 | ) | ||||||||||
Net unrealized gains (losses) | 27,945 | (21 | ) | 27,924 | (26,364 | ) | 17 | (26,347 | ) | |||||||||||
Balance, end of the period | $ | (2,593 | ) | $ | 58 | $ | (2,535 | ) | $ | (21,721 | ) | $ | 43 | $ | (21,678 | ) | ||||
The components of other comprehensive income (loss), reclassifications to net income by income statement line item and the related tax effects were as follows: | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Tax | Tax | |||||||||||||||||||
Before-Tax | Expense | Net-of-Tax | Before-Tax | Expense | Net-of-Tax | |||||||||||||||
Three Months Ended June 30, | Amount | or Benefit | Amount | Amount | or Benefit | Amount | ||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||
Unrealized gains (losses) on investment securities available-for-sale: | ||||||||||||||||||||
Net unrealized gains (losses) arising during period | $ | 25,681 | $ | (10,786 | ) | $ | 14,895 | $ | (42,707 | ) | $ | 17,937 | $ | (24,770 | ) | |||||
Less: reclassification adjustment for gains included in net income (1) | (671 | ) | 282 | (389 | ) | (5,345 | ) | 2,245 | (3,100 | ) | ||||||||||
Net unrealized gains (losses) | 25,010 | (10,504 | ) | 14,506 | (48,052 | ) | 20,182 | (27,870 | ) | |||||||||||
Unrealized gains (losses) on other investments | ||||||||||||||||||||
Net unrealized (losses) gains arising during period | (7 | ) | 3 | (4 | ) | 12 | (5 | ) | 7 | |||||||||||
Less: reclassification adjustment for (gains) losses included in income | — | — | — | — | — | — | ||||||||||||||
Other comprehensive income (loss) | $ | 25,003 | $ | (10,501 | ) | $ | 14,502 | $ | (48,040 | ) | $ | 20,177 | $ | (27,863 | ) | |||||
Tax | Tax | |||||||||||||||||||
Before-Tax | Expense | Net-of-Tax | Before-Tax | Expense | Net-of-Tax | |||||||||||||||
Six Months Ended June 30, | Amount | or Benefit | Amount | Amount | or Benefit | Amount | ||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||
Unrealized gains (losses) on investment securities available-for-sale: | ||||||||||||||||||||
Net unrealized gains (losses) arising during period | $ | 52,271 | $ | (21,954 | ) | $ | 30,317 | $ | (34,533 | ) | $ | 14,504 | $ | (20,029 | ) | |||||
Less: reclassification adjustment for gains included in net income (1) | (4,089 | ) | 1,717 | (2,372 | ) | (10,922 | ) | 4,587 | (6,335 | ) | ||||||||||
Net unrealized gains (losses) | 48,182 | (20,237 | ) | 27,945 | (45,455 | ) | 19,091 | (26,364 | ) | |||||||||||
Unrealized gains (losses) on other investments | ||||||||||||||||||||
Net unrealized (losses) gains arising during period | (36 | ) | 15 | (21 | ) | 29 | (12 | ) | 17 | |||||||||||
Less: reclassification adjustment for (gains) losses included in income | — | — | — | — | — | — | ||||||||||||||
Other comprehensive income (loss) | $ | 48,146 | $ | (20,222 | ) | $ | 27,924 | $ | (45,426 | ) | $ | 19,079 | $ | (26,347 | ) | |||||
(1) The pretax amount is reported in net gains on sales of investment securities in the consolidated statements of operations. |
BUSINESS_SEGMENTS
BUSINESS SEGMENTS | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
BUSINESS SEGMENTS | ' | |||||||||||||
BUSINESS SEGMENTS | ' | |||||||||||||
NOTE 14 — BUSINESS SEGMENTS | ||||||||||||||
The Company utilizes an internal reporting system to measure the performance of various operating segments within the Bank and the Company overall. We have identified three operating segments for purposes of management reporting: 1) Retail Banking; 2) Commercial Banking; and 3) Other. These three business divisions meet the criteria of an operating segment: the segment engages in business activities from which it earns revenues and incurs expenses, and whose operating results are regularly reviewed by the Company’s chief operating decision-maker to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. The acquisition of MetroCorp has been reflected in the three business operating segments as applicable, as of June 30, 2014. | ||||||||||||||
The Retail Banking segment focuses primarily on retail operations through the Bank’s branch network. The Commercial Banking segment, which includes commercial real estate, primarily generates commercial loans through the efforts of the commercial lending offices located in the Bank’s northern and southern California production offices. Furthermore, the Company’s Commercial Banking segment also offers a wide variety of international finance and trade services and products. The remaining centralized functions, including treasury activities and eliminations of intersegment amounts, have been aggregated and included in the Other segment, which provides broad administrative support to the two core segments. | ||||||||||||||
The Company’s funds transfer pricing assumptions are intended to promote core deposit growth and to reflect the current risk profiles of various loan categories within the credit portfolio. Transfer pricing assumptions and methodologies are reviewed at least annually to ensure that the Company’s process is reflective of current market conditions. The transfer pricing process is formulated with the goal of incenting loan and deposit growth that is consistent with the Company’s overall growth objectives as well as to provide a reasonable and consistent basis for the measurement of the Company’s business segments and product net interest margins. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Operating segment results are based on the Company’s internal management reporting process, which reflects assignments and allocations of capital, certain operating and administrative costs, and the provision for loan losses. Net interest income is based on the Company’s internal funds transfer pricing system, which assigns a cost of funds or a credit for funds to assets or liabilities based on their type, maturity or repricing characteristics. Noninterest income and noninterest expense, including depreciation and amortization, directly attributable to a segment are assigned to that business. Indirect costs, including overhead expense, are allocated to the segments based on several factors, including, but not limited to, full-time equivalent employees, loan volume, and deposit volume. The provision for credit losses is allocated based on actual charge-offs for the period as well as average loan balances for each segment during the period. The Company evaluates overall performance based on profit or loss from operations before income taxes excluding nonrecurring gains and losses. | ||||||||||||||
Changes in our management structure or reporting methodologies may result in changes in the measurement of operating segment results. Results for prior periods are generally restated for comparability for changes in management structure or reporting methodologies unless it is not deemed practicable to do so. | ||||||||||||||
The following tables present the operating results and other key financial measures for the individual operating segments for the three and six months ended June 30, 2014 and 2013: | ||||||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 99,792 | $ | 181,880 | $ | 12,770 | $ | 294,442 | ||||||
Charge for funds used | (23,854 | ) | (34,281 | ) | (9,929 | ) | (68,064 | ) | ||||||
Interest spread on funds used | 75,938 | 147,599 | 2,841 | 226,378 | ||||||||||
Interest expense | (11,950 | ) | (3,421 | ) | (12,621 | ) | (27,992 | ) | ||||||
Credit on funds provided | 54,139 | 8,983 | 4,942 | 68,064 | ||||||||||
Interest spread on funds provided | 42,189 | 5,562 | (7,679 | ) | 40,072 | |||||||||
Net interest income (loss) | $ | 118,127 | $ | 153,161 | $ | (4,838 | ) | $ | 266,450 | |||||
Provision for loan losses | $ | (440 | ) | $ | 8,440 | $ | — | $ | 8,000 | |||||
Depreciation, amortization and accretion | 4,096 | (1,286 | ) | 19,508 | 22,318 | |||||||||
Goodwill | 354,163 | 104,304 | — | 458,467 | ||||||||||
Segment pre-tax profit (loss) | 45,691 | 73,987 | (4,072 | ) | 115,606 | |||||||||
Segment assets | $ | 7,822,020 | $ | 14,177,634 | $ | 5,557,451 | $ | 27,557,105 | ||||||
Three Months Ended June 30, 2013 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 93,928 | $ | 147,168 | $ | 14,257 | $ | 255,353 | ||||||
Charge for funds used | (17,901 | ) | (27,883 | ) | 156 | (45,628 | ) | |||||||
Interest spread on funds used | 76,027 | 119,285 | 14,413 | 209,725 | ||||||||||
Interest expense | (11,708 | ) | (3,940 | ) | (12,061 | ) | (27,709 | ) | ||||||
Credit on funds provided | 36,022 | 5,711 | 3,895 | 45,628 | ||||||||||
Interest spread on funds provided | 24,314 | 1,771 | (8,166 | ) | 17,919 | |||||||||
Net interest income | $ | 100,341 | $ | 121,056 | $ | 6,247 | $ | 227,644 | ||||||
Provision for loan losses | $ | 2,886 | $ | 6,114 | $ | — | $ | 9,000 | ||||||
Depreciation, amortization and accretion | 5,865 | 3,445 | 14,602 | 23,912 | ||||||||||
Goodwill | 320,566 | 16,872 | — | 337,438 | ||||||||||
Segment pre-tax profit | 32,493 | 65,514 | 13,863 | 111,870 | ||||||||||
Segment assets | $ | 7,035,908 | $ | 10,903,753 | $ | 5,368,745 | $ | 23,308,406 | ||||||
Six Months Ended June 30, 2014 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 198,517 | $ | 350,956 | $ | 31,142 | $ | 580,615 | ||||||
Charge for funds used | (48,150 | ) | (66,098 | ) | (14,312 | ) | (128,560 | ) | ||||||
Interest spread on funds used | 150,367 | 284,858 | 16,830 | 452,055 | ||||||||||
Interest expense | (23,661 | ) | (6,701 | ) | (25,837 | ) | (56,199 | ) | ||||||
Credit on funds provided | 102,332 | 17,419 | 8,809 | 128,560 | ||||||||||
Interest spread on funds provided | 78,671 | 10,718 | (17,028 | ) | 72,361 | |||||||||
Net interest income (loss) | $ | 229,038 | $ | 295,576 | $ | (198 | ) | $ | 524,416 | |||||
Provision for loan losses | $ | 2,212 | $ | 12,721 | $ | — | $ | 14,933 | ||||||
Depreciation, amortization and accretion | 6,667 | (4,614 | ) | 33,801 | 35,854 | |||||||||
Goodwill | 354,163 | 104,304 | — | 458,467 | ||||||||||
Segment pre-tax profit (loss) | 88,022 | 148,718 | (9,444 | ) | 227,296 | |||||||||
Segment assets | $ | 7,822,020 | $ | 14,177,634 | $ | 5,557,451 | $ | 27,557,105 | ||||||
Six Months Ended June 30, 2013 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 176,767 | $ | 287,228 | $ | 29,781 | $ | 493,776 | ||||||
Charge for funds used | (37,885 | ) | (55,956 | ) | 9,429 | (84,412 | ) | |||||||
Interest spread on funds used | 138,882 | 231,272 | 39,210 | 409,364 | ||||||||||
Interest expense | (24,353 | ) | (8,317 | ) | (24,171 | ) | (56,841 | ) | ||||||
Credit on funds provided | 68,418 | 9,334 | 6,660 | 84,412 | ||||||||||
Interest spread on funds provided | 44,065 | 1,017 | (17,511 | ) | 27,571 | |||||||||
Net interest income | $ | 182,947 | $ | 232,289 | $ | 21,699 | $ | 436,935 | ||||||
Provision for loan losses | $ | 6,566 | $ | 6,761 | $ | — | $ | 13,327 | ||||||
Depreciation, amortization and accretion | 8,286 | 626 | 29,997 | 38,909 | ||||||||||
Goodwill | 320,566 | 16,872 | — | 337,438 | ||||||||||
Segment pre-tax profit | 51,420 | 132,195 | 34,765 | 218,380 | ||||||||||
Segment assets | $ | 7,035,908 | $ | 10,903,753 | $ | 5,368,745 | $ | 23,308,406 |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2014 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
NOTE 15 — SUBSEQUENT EVENTS | |
Dividend Payout | |
In July 2014, the Company’s Board of Directors declared a quarterly dividend of $0.18 per share on the Company’s common stock payable on or about August 15, 2014 to shareholders of record as of August 1, 2014. |
FAIR_VALUE_Tables
FAIR VALUE (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 30, 2014 | |||||||||||||||||
FAIR VALUE | ' | ||||||||||||||||
Assets (Liabilities) Measured at Fair Value on Recurring Basis | ' | ||||||||||||||||
Assets (Liabilities) Measured at Fair Value on a Recurring Basis | |||||||||||||||||
as of June 30, 2014 | |||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||
Fair Value | Active Markets | Other | Significant | ||||||||||||||
Measurements | for Identical | Observable | Unobservable | ||||||||||||||
June 30, | Assets | Inputs | Inputs | ||||||||||||||
2014 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment securities available-for-sale: | |||||||||||||||||
U.S. Treasury securities | $ | 449,312 | $ | 449,312 | $ | — | $ | — | |||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 438,599 | — | 438,599 | — | |||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | |||||||||||||||||
Commercial mortgage-backed securities | 111,757 | — | 111,757 | — | |||||||||||||
Residential mortgage-backed securities | 797,966 | — | 797,966 | — | |||||||||||||
Municipal securities | 289,479 | — | 289,479 | — | |||||||||||||
Other residential mortgage-backed securities: | |||||||||||||||||
Investment grade | 57,206 | — | 57,206 | — | |||||||||||||
Other commercial mortgage-backed securities: | |||||||||||||||||
Investment grade | 51,463 | — | 51,463 | — | |||||||||||||
Corporate debt securities: | |||||||||||||||||
Investment grade | 210,870 | — | 210,870 | — | |||||||||||||
Non-investment grade | 16,579 | — | 8,662 | 7,917 | |||||||||||||
Other securities | 106,421 | — | 106,421 | — | |||||||||||||
Total investment securities available-for-sale | $ | 2,529,652 | $ | 449,312 | $ | 2,072,423 | $ | 7,917 | |||||||||
Foreign exchange options | $ | 6,049 | $ | — | $ | 6,049 | $ | — | |||||||||
Interest rate swaps and caps | 30,233 | — | 30,233 | — | |||||||||||||
Foreign exchange contracts | 4,499 | — | 4,499 | — | |||||||||||||
Derivative liabilities | (48,388 | ) | — | (45,026 | ) | (3,362 | ) | ||||||||||
Assets (Liabilities) Measured at Fair Value on a Recurring Basis | |||||||||||||||||
as of December 31, 2013 | |||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||
Fair Value | Active Markets | Other | Significant | ||||||||||||||
Measurements | for Identical | Observable | Unobservable | ||||||||||||||
December 31, | Assets | Inputs | Inputs | ||||||||||||||
2013 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||
(In thousands) | |||||||||||||||||
Investment securities available-for-sale: | |||||||||||||||||
U.S. Treasury securities | $ | 491,632 | $ | 491,632 | $ | — | $ | — | |||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 394,323 | — | 394,323 | — | |||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | |||||||||||||||||
Commercial mortgage-backed securities | 178,870 | — | 178,870 | — | |||||||||||||
Residential mortgage-backed securities | 885,237 | — | 885,237 | — | |||||||||||||
Municipal securities | 280,979 | — | 280,979 | — | |||||||||||||
Other residential mortgage-backed securities: | |||||||||||||||||
Investment grade | 46,327 | — | 46,327 | — | |||||||||||||
Other commercial mortgage-backed securities: | |||||||||||||||||
Investment grade | 51,617 | — | 51,617 | — | |||||||||||||
Corporate debt securities: | |||||||||||||||||
Investment grade | 309,995 | — | 309,995 | — | |||||||||||||
Non-investment grade | 15,101 | — | 8,730 | 6,371 | |||||||||||||
Other securities | 79,716 | — | 79,716 | — | |||||||||||||
Total investment securities available-for-sale | $ | 2,733,797 | $ | 491,632 | $ | 2,235,794 | $ | 6,371 | |||||||||
Foreign exchange options | $ | 6,290 | $ | — | $ | 6,290 | $ | — | |||||||||
Interest rate swaps and caps | 28,078 | — | 28,078 | — | |||||||||||||
Foreign exchange contracts | 6,181 | — | 6,181 | — | |||||||||||||
Derivative liabilities | (50,262 | ) | — | (46,607 | ) | (3,655 | ) | ||||||||||
Assets Measured at Fair Value on a Non-Recurring Basis | ' | ||||||||||||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Three Months Ended June 30, 2014 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Three Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2014 | (Level 1) | (Level 2) | (Level 3) | 2014 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 17,908 | $ | — | $ | — | $ | 17,908 | $ | 413 | |||||||
Total commercial real estate | 22,758 | — | — | 22,758 | 1,865 | ||||||||||||
Total commercial and industrial | 9,837 | — | — | 9,837 | (9,642 | ) | |||||||||||
Total consumer | — | — | — | — | — | ||||||||||||
Total non-covered loans | $ | 50,503 | $ | — | $ | — | $ | 50,503 | $ | (7,364 | ) | ||||||
Non-covered OREO | $ | 676 | $ | — | $ | — | $ | 676 | $ | — | |||||||
Covered OREO (1) | $ | 4,009 | $ | — | $ | — | $ | 4,009 | $ | (69 | ) | ||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Three Months Ended June 30, 2013 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Three Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2013 | (Level 1) | (Level 2) | (Level 3) | 2013 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 22,012 | $ | — | $ | — | $ | 22,012 | $ | (838 | ) | ||||||
Total commercial real estate | 35,349 | — | — | 35,349 | (1,320 | ) | |||||||||||
Total commercial and industrial | 9,203 | — | — | 9,203 | 674 | ||||||||||||
Total consumer | 372 | — | — | 372 | 4 | ||||||||||||
Total non-covered loans | $ | 66,936 | $ | — | $ | — | $ | 66,936 | $ | (1,480 | ) | ||||||
Non-covered OREO | $ | 435 | $ | — | $ | — | $ | 435 | $ | (18 | ) | ||||||
Covered OREO (1) | $ | 7,500 | $ | — | $ | — | $ | 7,500 | $ | (1,000 | ) | ||||||
(1) Covered OREO results from the WFIB and UCB FDIC-assisted acquisitions for which the Company entered into shared-loss agreements with the FDIC whereby the FDIC will reimburse the Company for 80% of eligible losses. As such, the Company’s liability for losses is 20% of the $69 thousand in losses, or $14 thousand, and 20% of the $1.0 million in losses, or $200 thousand, for the three months ended June 30, 2014 and 2013, respectively. | |||||||||||||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Six Months Ended June 30, 2014 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Six Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2014 | (Level 1) | (Level 2) | (Level 3) | 2014 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 9,800 | $ | — | $ | — | $ | 9,800 | $ | 27 | |||||||
Total commercial real estate | 22,333 | — | — | 22,333 | 1,376 | ||||||||||||
Total commercial and industrial | 8,941 | — | — | 8,941 | (11,705 | ) | |||||||||||
Total consumer | — | — | — | — | — | ||||||||||||
Total non-covered loans | $ | 41,074 | $ | — | $ | — | $ | 41,074 | $ | (10,302 | ) | ||||||
Non-covered OREO | $ | 676 | $ | — | $ | — | $ | 676 | $ | (74 | ) | ||||||
Covered OREO (1) | $ | 4,009 | $ | — | $ | — | $ | 4,009 | $ | (521 | ) | ||||||
Assets Measured at Fair Value on a Non-Recurring Basis | |||||||||||||||||
as of and for the Six Months Ended June 30, 2013 | |||||||||||||||||
Quoted Prices in | Significant | Total Gains | |||||||||||||||
Fair Value | Active Markets | Other | Significant | (Losses) for the | |||||||||||||
Measurements | for Identical | Observable | Unobservable | Six Months Ended | |||||||||||||
June 30, | Assets | Inputs | Inputs | June 30, | |||||||||||||
2013 | (Level 1) | (Level 2) | (Level 3) | 2013 | |||||||||||||
(In thousands) | |||||||||||||||||
Non-covered loans: | |||||||||||||||||
Total residential | $ | 19,971 | $ | — | $ | — | $ | 19,971 | $ | (1,274 | ) | ||||||
Total commercial real estate | 30,397 | — | — | 30,397 | (3,422 | ) | |||||||||||
Total commercial and industrial | 9,723 | — | — | 9,723 | (1,492 | ) | |||||||||||
Total consumer | 293 | — | — | 293 | (112 | ) | |||||||||||
Total non-covered loans | $ | 60,384 | $ | — | $ | — | $ | 60,384 | $ | (6,300 | ) | ||||||
Non-covered OREO | $ | 13,238 | $ | — | $ | — | $ | 13,238 | $ | (1,403 | ) | ||||||
Covered OREO (1) | $ | 11,030 | $ | — | $ | — | $ | 11,030 | $ | (1,126 | ) | ||||||
(1) Covered OREO results from the WFIB and UCB FDIC-assisted acquisitions for which the Company entered into shared-loss agreements with the FDIC whereby the FDIC will reimburse the Company for 80% of eligible losses. As such, the Company’s liability for losses is 20% of the $521 thousand in losses, or $104 thousand, and 20% of the $1.1 million in losses, or $225 thousand, for the six months ended June 30, 2014 and 2013, respectively | |||||||||||||||||
Reconciliation of assets and liabilities measured at fair value using significant unobservable inputs | ' | ||||||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Opening balance, April 1, 2014 | $ | 6,717 | $ | (3,398 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | 36 | |||||||||||||||
Included in other comprehensive income (unrealized) (2) | 1,209 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (9 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2014 | $ | 7,917 | $ | (3,362 | ) | ||||||||||||
Changes in unrealized gains included in earnings relating to assets and liabilities held at the end of June 30, 2014 | $ | — | $ | (36 | ) | ||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Opening balance, April 1, 2013 | $ | 5,284 | $ | (3,233 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | (24 | ) | ||||||||||||||
Included in other comprehensive income (unrealized) (2) | 239 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (6 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2013 | $ | 5,517 | $ | (3,257 | ) | ||||||||||||
Changes in unrealized losses included in earnings relating to assets and liabilities held at the end of June 30, 2013 | $ | — | $ | 24 | |||||||||||||
(1) Total gains or losses represent the total realized and unrealized gains and losses recorded for Level 3 assets and liabilities. Realized gains or losses are reported in the consolidated statements of income. | |||||||||||||||||
(2) Unrealized gains or losses on investment securities are reported in accumulated other comprehensive income (loss), net of tax, in the consolidated statements of comprehensive income. | |||||||||||||||||
(3) Purchases, issuances, sales, and settlements represent Level 3 assets and liabilities that were either purchased, issued, sold, or settled during the period. The amounts are recorded at their end of period fair values. | |||||||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Beginning balance, January 1, 2014 | $ | 6,371 | $ | (3,655 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | 293 | |||||||||||||||
Included in other comprehensive income (unrealized) (2) | 1,643 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (97 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2014 | $ | 7,917 | $ | (3,362 | ) | ||||||||||||
Changes in unrealized gains included in earnings relating to assets and liabilities held at the end of June 30, 2014 | $ | — | $ | (293 | ) | ||||||||||||
Investment Securities | |||||||||||||||||
Available-for-Sale | |||||||||||||||||
Corporate Debt | |||||||||||||||||
Securities | |||||||||||||||||
Non-Investment Grade | Derivatives Payable | ||||||||||||||||
(In thousands) | |||||||||||||||||
Beginning balance, January 1, 2013 | $ | 4,800 | $ | (3,052 | ) | ||||||||||||
Total gains or (losses) for the period: (1) | |||||||||||||||||
Included in earnings | — | (205 | ) | ||||||||||||||
Included in other comprehensive income (unrealized) (2) | 788 | — | |||||||||||||||
Purchases, issues, sales, settlements (3) | |||||||||||||||||
Purchases | — | — | |||||||||||||||
Issues | — | — | |||||||||||||||
Sales | — | — | |||||||||||||||
Settlements | (71 | ) | — | ||||||||||||||
Transfer from investment grade to non-investment grade | — | — | |||||||||||||||
Transfers in and/or out of Level 3 | — | — | |||||||||||||||
Closing balance, June 30, 2013 | $ | 5,517 | $ | (3,257 | ) | ||||||||||||
Changes in unrealized losses included in earnings relating to assets and liabilities held at the end of June 30, 2013 | $ | — | $ | 205 | |||||||||||||
(1) Total gains or losses represent the total realized and unrealized gains and losses recorded for Level 3 assets and liabilities. Realized gains or losses are reported in the consolidated statements of income. | |||||||||||||||||
(2) Unrealized gains or losses on investment securities are reported in accumulated other comprehensive income (loss), net of tax, in the consolidated statements of comprehensive income. | |||||||||||||||||
(3) Purchases, issuances, sales, and settlements represent Level 3 assets and liabilities that were either purchased, issued, sold, or settled during the period. The amounts are recorded at their end of period fair values. | |||||||||||||||||
Carrying amounts and fair values of financial instruments | ' | ||||||||||||||||
June 30, 2014 | December 31, 2013 | ||||||||||||||||
Carrying | Estimated | Carrying | Estimated | ||||||||||||||
Amount | Fair Value | Amount | Fair Value | ||||||||||||||
(In thousands) | |||||||||||||||||
Financial Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 1,246,044 | $ | 1,246,044 | $ | 895,820 | $ | 895,820 | |||||||||
Short-term investments | 286,130 | 286,130 | 257,473 | 257,473 | |||||||||||||
Securities purchased under resale agreements | 1,275,000 | 1,266,730 | 1,300,000 | 1,279,406 | |||||||||||||
Investment securities available-for-sale | 2,529,652 | 2,529,652 | 2,733,797 | 2,733,797 | |||||||||||||
Loans held for sale | 450,864 | 462,397 | 204,970 | 212,469 | |||||||||||||
Loans receivable, net | 19,828,801 | 19,211,124 | 17,600,613 | 16,741,674 | |||||||||||||
Investment in Federal Home Loan Bank stock | 37,731 | 37,731 | 62,330 | 62,330 | |||||||||||||
Investment in Federal Reserve Bank stock | 54,217 | 54,217 | 48,333 | 48,333 | |||||||||||||
Accrued interest receivable | 100,323 | 100,323 | 116,314 | 116,314 | |||||||||||||
Foreign exchange options | 6,049 | 6,049 | 6,290 | 6,290 | |||||||||||||
Interest rate swaps and caps | 30,233 | 30,233 | 28,078 | 28,078 | |||||||||||||
Foreign exchange contracts | 4,499 | 4,499 | 6,181 | 6,181 | |||||||||||||
Financial Liabilities: | |||||||||||||||||
Customer deposit accounts: | |||||||||||||||||
Demand, savings and money market deposits | 16,643,474 | 16,643,474 | 14,588,570 | 14,588,570 | |||||||||||||
Time deposits | 6,231,615 | 6,212,638 | 5,824,348 | 5,791,659 | |||||||||||||
Federal Home Loan Bank advances | 316,156 | 337,621 | 315,092 | 308,521 | |||||||||||||
Securities sold under repurchase agreements | 1,005,211 | 1,128,491 | 995,000 | 1,134,774 | |||||||||||||
Accrued interest payable | 11,020 | 11,020 | 11,178 | 11,178 | |||||||||||||
Long-term debt | 235,732 | 204,101 | 226,868 | 184,415 | |||||||||||||
Derivative liabilities | 48,388 | 48,388 | 50,262 | 50,262 | |||||||||||||
Schedule fair value hierarchy for the estimated fair values of financial instruments | ' | ||||||||||||||||
June 30, 2014 | |||||||||||||||||
Estimated | |||||||||||||||||
Fair Value | |||||||||||||||||
Measurements | Level 1 | Level 2 | Level 3 | ||||||||||||||
(In thousands) | |||||||||||||||||
Financial Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 1,246,044 | $ | 1,246,044 | $ | — | $ | — | |||||||||
Short-term investments | 286,130 | — | 286,130 | — | |||||||||||||
Securities purchased under resale agreements | 1,266,730 | — | 1,266,730 | — | |||||||||||||
Loans held for sale | 462,397 | — | 462,397 | — | |||||||||||||
Loans receivable, net | 19,211,124 | — | — | 19,211,124 | |||||||||||||
Investment in Federal Home Loan Bank stock | 37,731 | — | 37,731 | — | |||||||||||||
Investment in Federal Reserve Bank stock | 54,217 | — | 54,217 | — | |||||||||||||
Accrued interest receivable | 100,323 | — | 100,323 | — | |||||||||||||
Financial Liabilities: | |||||||||||||||||
Customer deposit accounts: | |||||||||||||||||
Demand, savings and money market deposits | 16,643,474 | — | 16,643,474 | — | |||||||||||||
Time deposits | 6,212,638 | — | — | 6,212,638 | |||||||||||||
Federal Home Loan Bank advances | 337,621 | — | 337,621 | — | |||||||||||||
Securities sold under repurchase agreements | 1,128,491 | — | 1,128,491 | — | |||||||||||||
Accrued interest payable | 11,020 | — | 11,020 | — | |||||||||||||
Long-term debt | 204,101 | — | 204,101 | — | |||||||||||||
December 31, 2013 | |||||||||||||||||
Estimated | |||||||||||||||||
Fair Value | |||||||||||||||||
Measurements | Level 1 | Level 2 | Level 3 | ||||||||||||||
(In thousands) | |||||||||||||||||
Financial Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 895,820 | $ | 895,820 | $ | — | $ | — | |||||||||
Short-term investments | 257,473 | — | 257,473 | — | |||||||||||||
Securities purchased under resale agreements | 1,279,406 | — | 1,279,406 | — | |||||||||||||
Loans held for sale | 212,469 | — | 212,469 | — | |||||||||||||
Loans receivable, net | 16,741,674 | — | — | 16,741,674 | |||||||||||||
Investment in Federal Home Loan Bank stock | 62,330 | — | 62,330 | — | |||||||||||||
Investment in Federal Reserve Bank stock | 48,333 | — | 48,333 | — | |||||||||||||
Accrued interest receivable | 116,314 | — | 116,314 | — | |||||||||||||
Financial Liabilities: | |||||||||||||||||
Customer deposit accounts: | |||||||||||||||||
Demand, savings and money market deposits | 14,588,570 | — | 14,588,570 | — | |||||||||||||
Time deposits | 5,791,659 | — | — | 5,791,659 | |||||||||||||
Federal Home Loan Bank advances | 308,521 | — | 308,521 | — | |||||||||||||
Securities sold under repurchase agreements | 1,134,774 | — | 1,134,774 | — | |||||||||||||
Accrued interest payable | 11,178 | — | 11,178 | — | |||||||||||||
Long-term debt | 184,415 | — | 184,415 | — | |||||||||||||
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
STOCK-BASED COMPENSATION | ' | |||||||||||||
Schedule of share-based compensation, stock options, activity | ' | |||||||||||||
Weighted | ||||||||||||||
Weighted | Average | Aggregate | ||||||||||||
Average | Remaining | Intrinsic | ||||||||||||
Exercise | Contractual | Value | ||||||||||||
Shares | Price | Term | (In thousands) | |||||||||||
Outstanding at beginning of period | 406,731 | $ | 26.72 | |||||||||||
Granted | — | — | ||||||||||||
Exercised | (13,415 | ) | 21.09 | |||||||||||
Expired | (130,514 | ) | 38.76 | |||||||||||
Outstanding at end of period | 262,802 | $ | 21.03 | 0.65 years | $ | 3,667 | ||||||||
Vested or expected to vest at end of period | 262,802 | $ | 21.03 | 0.65 years | $ | 3,667 | ||||||||
Exercisable at end of period | 262,802 | $ | 21.03 | 0.65 years | $ | 3,667 | ||||||||
Schedule of share-based compensation arrangement by share-based payment award, options, grants in period, grant date intrinsic value | ' | |||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Weighted average grant date fair value of stock options granted during the period (1) | N/A | N/A | N/A | N/A | ||||||||||
Total intrinsic value of options exercised (in thousands) | $ | — | $ | 297 | $ | 194 | $ | 424 | ||||||
Total fair value of options vested (in thousands) (2) | N/A | N/A | N/A | $ | 363 | |||||||||
(1) The Company did not issue any stock options during the three and six months ended June 30, 2014 and 2013. | ||||||||||||||
(2) Stock options were fully vested during the first quarter of 2013. | ||||||||||||||
Schedule of share-based compensation, time-based and performance-based restricted stock awards activity | ' | |||||||||||||
June 30, 2014 | ||||||||||||||
Restricted Stock Awards | ||||||||||||||
Time-Based | Performance-Based | |||||||||||||
Weighted | Weighted | |||||||||||||
Average | Average | |||||||||||||
Shares | Price | Shares | Price | |||||||||||
Outstanding at beginning of period | 438,508 | $ | 17.79 | 956,707 | $ | 23.74 | ||||||||
Granted | 12,010 | 31.64 | 603,697 | 36.85 | ||||||||||
Vested | (153,279 | ) | 11.18 | (340,781 | ) | 23.52 | ||||||||
Forfeited | (17,446 | ) | 19.92 | (28,535 | ) | 27.22 | ||||||||
Outstanding at end of period | 279,793 | $ | 21.87 | 1,191,088 | $ | 30.36 |
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
INVESTMENT SECURITIES | ' | |||||||||||||||||||
Schedule of amortized cost and fair value by major categories of available-for-sale securities | ' | |||||||||||||||||||
Gross | Gross | Estimated | ||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||||||
Cost | Gains | Losses | Value | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 450,149 | $ | 791 | $ | (1,628 | ) | $ | 449,312 | |||||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 441,747 | 938 | (4,086 | ) | 438,599 | |||||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 112,607 | 513 | (1,363 | ) | 111,757 | |||||||||||||||
Residential mortgage-backed securities | 798,915 | 8,108 | (9,057 | ) | 797,966 | |||||||||||||||
Municipal securities | 289,200 | 4,926 | (4,647 | ) | 289,479 | |||||||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 57,065 | 557 | (416 | ) | 57,206 | |||||||||||||||
Other commercial mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 51,000 | 463 | — | 51,463 | ||||||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 211,144 | 1,172 | (1,446 | ) | 210,870 | |||||||||||||||
Non-investment grade | 19,953 | 131 | (3,505 | ) | 16,579 | |||||||||||||||
Other securities | 102,383 | 4,542 | (504 | ) | 106,421 | |||||||||||||||
Total investment securities available-for-sale | $ | 2,534,163 | $ | 22,141 | $ | (26,652 | ) | $ | 2,529,652 | |||||||||||
As of December 31, 2013 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 495,053 | $ | 201 | $ | (3,622 | ) | $ | 491,632 | |||||||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 406,807 | 242 | (12,726 | ) | 394,323 | |||||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 182,257 | 1,062 | (4,449 | ) | 178,870 | |||||||||||||||
Residential mortgage-backed securities | 892,435 | 7,729 | (14,927 | ) | 885,237 | |||||||||||||||
Municipal securities | 297,390 | 1,122 | (17,533 | ) | 280,979 | |||||||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 48,129 | — | (1,802 | ) | 46,327 | |||||||||||||||
Other commercial mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 51,000 | 617 | — | 51,617 | ||||||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 312,726 | 613 | (3,344 | ) | 309,995 | |||||||||||||||
Non-investment grade | 20,668 | 62 | (5,629 | ) | 15,101 | |||||||||||||||
Other securities | 80,025 | 555 | (864 | ) | 79,716 | |||||||||||||||
Total investment securities available-for-sale | $ | 2,786,490 | $ | 12,203 | $ | (64,896 | ) | $ | 2,733,797 | |||||||||||
Schedule of other than temporary impairment, credit losses recognized in earnings | ' | |||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Beginning balance | $ | 115,511 | $ | 115,511 | $ | 115,511 | $ | 115,511 | ||||||||||||
Addition of other-than-temporary impairment that was not previously recognized | — | — | — | — | ||||||||||||||||
Additional increases to the amount related to the credit loss for which an other-than-temporary impairment was previously recognized | — | — | — | — | ||||||||||||||||
Reduction for securities sold | — | — | — | — | ||||||||||||||||
Ending balance | $ | 115,511 | $ | 115,511 | $ | 115,511 | $ | 115,511 | ||||||||||||
Gross unrealized losses and related fair values of investment securities available-for-sale | ' | |||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||
(In thousands) | ||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 30,630 | $ | (40 | ) | $ | 184,740 | $ | (1,588 | ) | $ | 215,370 | $ | (1,628 | ) | |||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 33,829 | (882 | ) | 171,913 | (3,204 | ) | 205,742 | (4,086 | ) | |||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 23,683 | (513 | ) | 43,550 | (850 | ) | 67,233 | (1,363 | ) | |||||||||||
Residential mortgage-backed securities | 205,095 | (1,992 | ) | 306,292 | (7,065 | ) | 511,387 | (9,057 | ) | |||||||||||
Municipal securities | 3,949 | (15 | ) | 138,062 | (4,632 | ) | 142,011 | (4,647 | ) | |||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | — | — | 14,485 | (416 | ) | 14,485 | (416 | ) | ||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 19,943 | (57 | ) | 89,752 | (1,389 | ) | 109,695 | (1,446 | ) | |||||||||||
Non-investment grade | — | — | 14,660 | (3,505 | ) | 14,660 | (3,505 | ) | ||||||||||||
Other securities | 16,160 | (440 | ) | 2,904 | (64 | ) | 19,064 | (504 | ) | |||||||||||
Total investment securities available-for-sale | $ | 333,289 | $ | (3,939 | ) | $ | 966,358 | $ | (22,713 | ) | $ | 1,299,647 | $ | (26,652 | ) | |||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||
Value | Losses | Value | Losses | Value | Losses | |||||||||||||||
(In thousands) | ||||||||||||||||||||
As of December 31, 2013 | ||||||||||||||||||||
Investment securities available-for-sale: | ||||||||||||||||||||
U.S. Treasury securities | $ | 337,248 | $ | (3,622 | ) | $ | — | $ | — | $ | 337,248 | $ | (3,622 | ) | ||||||
U.S. government agency and U.S. government sponsored enterprise debt securities | 387,097 | (12,726 | ) | — | — | 387,097 | (12,726 | ) | ||||||||||||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities: | ||||||||||||||||||||
Commercial mortgage-backed securities | 114,754 | (3,280 | ) | 16,065 | (1,169 | ) | 130,819 | (4,449 | ) | |||||||||||
Residential mortgage-backed securities | 502,285 | (10,570 | ) | 92,540 | (4,357 | ) | 594,825 | (14,927 | ) | |||||||||||
Municipal securities | 173,782 | (10,765 | ) | 47,892 | (6,768 | ) | 221,674 | (17,533 | ) | |||||||||||
Other residential mortgage-backed securities: | ||||||||||||||||||||
Investment grade | 46,328 | (1,802 | ) | — | — | 46,328 | (1,802 | ) | ||||||||||||
Corporate debt securities: | ||||||||||||||||||||
Investment grade | 193,482 | (1,538 | ) | 79,442 | (1,806 | ) | 272,924 | (3,344 | ) | |||||||||||
Non-investment grade | — | — | 14,422 | (5,629 | ) | 14,422 | (5,629 | ) | ||||||||||||
Other securities | 48,098 | (864 | ) | — | — | 48,098 | (864 | ) | ||||||||||||
Total investment securities available-for-sale | $ | 1,803,074 | $ | (45,167 | ) | $ | 250,361 | $ | (19,729 | ) | $ | 2,053,435 | $ | (64,896 | ) | |||||
Schedule maturities of investment securities | ' | |||||||||||||||||||
Amortized | Estimated | |||||||||||||||||||
Cost | Fair Value | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Due within one year | $ | 457,710 | $ | 451,738 | ||||||||||||||||
Due after one year through five years | 557,768 | 558,346 | ||||||||||||||||||
Due after five years through ten years | 549,307 | 553,528 | ||||||||||||||||||
Due after ten years | 969,378 | 966,040 | ||||||||||||||||||
Total investment securities available-for-sale | $ | 2,534,163 | $ | 2,529,652 |
DERIVATIVE_FINANCIAL_INSTRUMEN1
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING | ' | |||||||||||||||||||
Fair values of derivative instruments | ' | |||||||||||||||||||
Fair Values of Derivative Instruments | ||||||||||||||||||||
June 30, 2014 | December 31, 2013 | |||||||||||||||||||
Notional | Derivative | Derivative | Notional | Derivative | Derivative | |||||||||||||||
Amount | Assets (1) | Liabilities (1) | Amount | Assets (1) | Liabilities (1) | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Derivatives designated as hedging instruments: | ||||||||||||||||||||
Interest rate swaps on certificates of deposit—fair value | $ | 135,000 | $ | — | $ | 11,157 | $ | 135,000 | $ | — | $ | 16,906 | ||||||||
Total derivatives designated as hedging instruments | $ | 135,000 | $ | — | $ | 11,157 | $ | 135,000 | $ | — | $ | 16,906 | ||||||||
Derivatives not designated as hedging instruments: | ||||||||||||||||||||
Foreign exchange options | $ | 85,614 | $ | 6,049 | $ | 3,362 | $ | 85,614 | $ | 6,290 | $ | 3,655 | ||||||||
Interest rate swaps and caps | 2,109,922 | 30,233 | 29,573 | 1,915,474 | 28,078 | 26,352 | ||||||||||||||
Foreign exchange contracts | 476,700 | 4,499 | 4,296 | 440,848 | 6,181 | 3,349 | ||||||||||||||
Total derivatives not designated as hedging instruments | $ | 2,672,236 | $ | 40,781 | $ | 37,231 | $ | 2,441,936 | $ | 40,549 | $ | 33,356 | ||||||||
(1) Derivative assets, which are a component of other assets, include the estimated settlement of the derivative asset position. Derivative liabilities, which are a component of other liabilities and deposits, include the estimated settlement of the derivative liability position. | ||||||||||||||||||||
Gains (losses) on derivative instruments | ' | |||||||||||||||||||
Location in | Three Months Ended | Six Months Ended | ||||||||||||||||||
Consolidated | June 30, | June 30, | ||||||||||||||||||
Statements of Income | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Derivatives designated as hedging instruments | ||||||||||||||||||||
Interest rate swaps on certificates of deposit—fair value | Interest expense | $ | 3,045 | $ | (3,810 | ) | $ | 5,750 | $ | (4,715 | ) | |||||||||
Total net income (expense) | $ | 3,045 | $ | (3,810 | ) | $ | 5,750 | $ | (4,715 | ) | ||||||||||
Derivatives not designated as hedging instruments | ||||||||||||||||||||
Foreign exchange options | Noninterest income | 173 | 97 | 54 | 238 | |||||||||||||||
Foreign exchange options | Noninterest expense | (3 | ) | (1 | ) | (2 | ) | 6 | ||||||||||||
Interest rate swaps and caps | Noninterest income | (130 | ) | 1,864 | (1,066 | ) | 2,080 | |||||||||||||
Foreign exchange contracts | Noninterest income | (500 | ) | (719 | ) | (2,629 | ) | (762 | ) | |||||||||||
Total net (expense) income | $ | (460 | ) | $ | 1,241 | $ | (3,643 | ) | $ | 1,562 | ||||||||||
Schedule of gross derivatives, resale agreements, repurchase agreements and the respective collateral received or pledged in the form of other financial instruments, which are generally marketable securities | ' | |||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Assets Presented | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | in the | Consolidated Balance Sheets | |||||||||||||||||
Assets | of Recognized | Consolidated | Consolidated | Financial | Collateral | Net Amount | ||||||||||||||
Assets | Balance Sheets | Balance Sheets | Instruments | Received | ||||||||||||||||
Derivatives | $ | 9,711 | $ | — | $ | 9,711 | $ | (5,122 | ) | $ | (4,589 | )(1) | $ | — | ||||||
Resale Agreements | $ | 1,275,000 | $ | — | $ | 1,275,000 | $ | (475,000 | ) | $ | (800,000 | )(2) | $ | — | ||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Liabilities | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | Presented in the | Consolidated Balance Sheets | |||||||||||||||||
Liabilities | of Recognized | Consolidated | Consolidated | Financial | Collateral Posted | Net Amount | ||||||||||||||
Liabilities | Balance Sheets | Balance Sheets | Instruments | |||||||||||||||||
Derivatives | $ | 40,459 | $ | — | $ | 40,459 | $ | (5,122 | ) | $ | (35,337 | )(3) | $ | — | ||||||
Repurchase Agreements | $ | 1,005,211 | $ | — | $ | 1,005,211 | $ | (475,000 | ) | $ | (530,211 | )(4) | $ | — | ||||||
As of December 31, 2013 | ||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Assets Presented | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | in the | Consolidated Balance Sheets | |||||||||||||||||
Assets | of Recognized | Consolidated | Consolidated | Financial | Collateral | Net Amount | ||||||||||||||
Assets | Balance Sheets | Balance Sheets | Instruments | Received | ||||||||||||||||
Derivatives | $ | 16,043 | $ | — | $ | 16,043 | $ | (11,363 | ) | $ | (4,680 | )(1) | $ | — | ||||||
Resale Agreements | $ | 1,400,000 | $ | — | $ | 1,400,000 | $ | (495,000 | ) | $ | (905,000 | )(2) | $ | — | ||||||
Net Amounts of | ||||||||||||||||||||
Gross Amounts | Liabilities | Gross Amounts Not Offset in the | ||||||||||||||||||
Gross Amounts | Offset in the | Presented in the | Consolidated Balance Sheets | |||||||||||||||||
Liabilities | of Recognized | Consolidated | Consolidated | Financial | Collateral Posted | Net Amount | ||||||||||||||
Liabilities | Balance Sheets | Balance Sheets | Instruments | |||||||||||||||||
Derivatives | $ | 33,849 | $ | — | $ | 33,849 | $ | (11,363 | ) | $ | (22,486 | )(3) | $ | — | ||||||
Repurchase Agreements | $ | 995,000 | $ | — | $ | 995,000 | $ | (495,000 | ) | $ | (500,000 | )(4) | $ | — | ||||||
(1) Represents cash and securities received against derivative assets with the same counterparty that are subject to enforceable master netting arrangements. Includes approximately $3.6 million of cash collateral received as of June 30, 2014. | ||||||||||||||||||||
(2) Represents the fair value of securities the Company has received under resale agreements, limited for table presentation purposes to the amount of the recognized asset due from each counterparty. | ||||||||||||||||||||
(3) Represents cash and securities pledged against derivative liabilities with the same counterparty that are subject to enforceable master netting arrangements. Includes approximately $7.5 million and $187 thousand of cash collateral posted as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
(4) Represents the fair value of securities the Company has pledged under repurchase agreements, limited for table presentation purposes to the amount of the recognized liability owed to each counterparty. |
COVERED_ASSETS_AND_FDIC_INDEMN1
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET | ' | |||||||||||||||||||
Composition of covered loans | ' | |||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Residential: | ||||||||||||||||||||
Residential single-family | $ | 259,438 | $ | 290,095 | ||||||||||||||||
Residential multifamily | 361,472 | 403,508 | ||||||||||||||||||
Total residential | 620,910 | 693,603 | ||||||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||
Commercial and industrial real estate | 895,140 | 1,103,530 | ||||||||||||||||||
Construction and land | 73,216 | 163,833 | ||||||||||||||||||
Total CRE | 968,356 | 1,267,363 | ||||||||||||||||||
Other Loans: | ||||||||||||||||||||
Commercial business | 331,117 | 426,621 | ||||||||||||||||||
Other consumer | 68,944 | 73,973 | ||||||||||||||||||
Total other loans | 400,061 | 500,594 | ||||||||||||||||||
Total covered loans receivable | 1,989,327 | -1 | 2,461,560 | -2 | ||||||||||||||||
Covered discount | (181,357 | ) | (265,917 | ) | ||||||||||||||||
Net valuation of loans | 1,807,970 | 2,195,643 | ||||||||||||||||||
Allowance on covered loans | (4,880 | ) | (7,745 | ) | ||||||||||||||||
Total covered loans, net | $ | 1,803,090 | $ | 2,187,898 | ||||||||||||||||
Collectively evaluated for impairment | $ | 252,205 | -1 | $ | 320,185 | -2 | ||||||||||||||
Acquired with deteriorated credit quality | 1,555,765 | 1,875,458 | ||||||||||||||||||
$ | 1,807,970 | $ | 2,195,643 | |||||||||||||||||
(1) Includes $252.2 million of covered advances comprised of $202.5 million, $29.0 million, $11.7 million and $9.0 million of commercial and industrial, consumer, residential and commercial real estate loans, respectively. | ||||||||||||||||||||
(2) Includes $320.2 million of covered advances comprised of $230.6 million, $46.7 million, $30.9 million and $12.0 million of commercial and industrial, commercial real estate, consumer and residential loans, respectively. | ||||||||||||||||||||
Allowance for loan losses disclosures | ' | |||||||||||||||||||
Schedule of credit risk rating categories for the covered loans by portfolio segments | ' | |||||||||||||||||||
Special | ||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||
Residential: | ||||||||||||||||||||
Residential single-family | $ | 252,121 | $ | 757 | $ | 6,560 | $ | — | $ | 259,438 | ||||||||||
Residential multifamily | 327,990 | 786 | 32,696 | — | 361,472 | |||||||||||||||
Total residential | 580,111 | 1,543 | 39,256 | — | 620,910 | |||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||
Commercial and industrial real estate | 755,244 | 3,255 | 130,173 | 6,468 | 895,140 | |||||||||||||||
Construction and land | 25,628 | 9,235 | 37,461 | 892 | 73,216 | |||||||||||||||
Total CRE | 780,872 | 12,490 | 167,634 | 7,360 | 968,356 | |||||||||||||||
Other Loans: | ||||||||||||||||||||
Commercial business | 282,018 | 7,171 | 41,928 | — | 331,117 | |||||||||||||||
Other consumer | 67,320 | 100 | 1,524 | — | 68,944 | |||||||||||||||
Total other loans | 349,338 | 7,271 | 43,452 | — | 400,061 | |||||||||||||||
Total principal balance | $ | 1,710,321 | $ | 21,304 | $ | 250,342 | $ | 7,360 | $ | 1,989,327 | ||||||||||
Special | ||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||
Residential: | ||||||||||||||||||||
Residential single-family | $ | 281,246 | $ | 733 | $ | 8,116 | $ | — | $ | 290,095 | ||||||||||
Residential multifamily | 373,024 | 785 | 29,699 | — | 403,508 | |||||||||||||||
Total residential | 654,270 | 1,518 | 37,815 | — | 693,603 | |||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||
Commercial and industrial real estate | 857,376 | 27,851 | 211,835 | 6,468 | 1,103,530 | |||||||||||||||
Construction and land | 41,847 | 9,472 | 111,616 | 898 | 163,833 | |||||||||||||||
Total CRE | 899,223 | 37,323 | 323,451 | 7,366 | 1,267,363 | |||||||||||||||
Other Loans: | ||||||||||||||||||||
Commercial business | 378,086 | 4,635 | 43,797 | 103 | 426,621 | |||||||||||||||
Other consumer | 72,053 | 128 | 1,792 | — | 73,973 | |||||||||||||||
Total other loans | 450,139 | 4,763 | 45,589 | 103 | 500,594 | |||||||||||||||
Total principal balance | $ | 2,003,632 | $ | 43,604 | $ | 406,855 | $ | 7,469 | $ | 2,461,560 | ||||||||||
Covered nonperforming assets | ' | |||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Covered nonaccrual loans(1) (2) (3) | $ | 86,771 | $ | 126,895 | ||||||||||||||||
Other real estate owned covered, net | 24,779 | 21,373 | ||||||||||||||||||
Total covered nonperforming assets | $ | 111,550 | $ | 148,268 | ||||||||||||||||
(1) Covered nonaccrual loans include loans that meet the criteria for nonaccrual but have a yield accreted through interest income under ASC 310-30. All losses on covered loans are 80% reimbursed by the FDIC. | ||||||||||||||||||||
(2) Net of discount. | ||||||||||||||||||||
(3) Includes $14.3 million and $17.7 million of covered advances as of June 30, 2014 and December 31, 2013, respectively; and $72.5 million and $109.2 million of PCI loans as of June 30, 2014 and December 31, 2013, respectively. | ||||||||||||||||||||
Schedule of troubled debt restructurings loan activity | ' | |||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 73,234 | $ | 141,923 | $ | 116,007 | $ | 157,736 | ||||||||||||
Additions | 704 | 3,709 | 787 | 25,793 | ||||||||||||||||
Transfers to covered OREO | — | — | (1,230 | ) | — | |||||||||||||||
Charge-offs | (500 | ) | (3,762 | ) | (1,323 | ) | (7,466 | ) | ||||||||||||
Paydowns/ Reductions | (13,414 | ) | (21,622 | ) | (54,217 | ) | (55,815 | ) | ||||||||||||
Balance at end of period | $ | 60,024 | $ | 120,248 | $ | 60,024 | $ | 120,248 | ||||||||||||
Changes in the accretable yield for the PCI covered loans | ' | |||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 424,005 | $ | 503,476 | $ | 461,545 | $ | 556,986 | ||||||||||||
Additions | — | — | — | — | ||||||||||||||||
Accretion | (64,114 | ) | (84,811 | ) | (125,304 | ) | (166,438 | ) | ||||||||||||
Changes in expected cash flows | 27,236 | 40,052 | 50,886 | 68,169 | ||||||||||||||||
Balance at end of period | $ | 387,127 | $ | 458,717 | $ | 387,127 | $ | 458,717 | ||||||||||||
FDIC indemnification asset liabilities activity | ' | |||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 27,552 | $ | 276,834 | $ | 74,708 | $ | 316,313 | ||||||||||||
Amortization | (29,303 | ) | (12,696 | ) | (57,793 | ) | (21,382 | ) | ||||||||||||
Reductions (1) | (14,111 | ) | (28,820 | ) | (25,953 | ) | (52,055 | ) | ||||||||||||
Estimate of FDIC repayment (2) | (8,475 | ) | (15,376 | ) | (15,299 | ) | (22,934 | ) | ||||||||||||
Balance at end of period | $ | (24,337 | ) | $ | 219,942 | $ | (24,337 | ) | $ | 219,942 | ||||||||||
(1) Reductions relate to charge-offs, partial prepayments, loan payoffs and loan sales which result in a corresponding reduction of the indemnification asset. | ||||||||||||||||||||
(2) This represents the change in the calculated estimate the Company will be required to pay the FDIC at the end of the FDIC loss share agreements, due to lower thresholds of losses. | ||||||||||||||||||||
Summary of FDIC receivable activity | ' | |||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Balance at beginning of period | $ | 19,644 | $ | 46,762 | $ | 30,261 | $ | 73,091 | ||||||||||||
Net (reduction) addition due to recovery or eligible expense/loss | (5,669 | ) | 8,967 | (12,147 | ) | 16,528 | ||||||||||||||
Payments to (received from) the FDIC | 1,772 | (8,604 | ) | (2,367 | ) | (42,494 | ) | |||||||||||||
Balance at end of period | $ | 15,747 | $ | 47,125 | $ | 15,747 | $ | 47,125 | ||||||||||||
Covered loans | ' | |||||||||||||||||||
Allowance for loan losses disclosures | ' | |||||||||||||||||||
Summary of the activity in the allowance for loan losses | ' | |||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Covered | PCI Covered | Covered | PCI Covered | |||||||||||||||||
Advances | Loans | Total | Advances | Loans | Total | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Beginning balance | $ | 4,316 | $ | 2,202 | $ | 6,518 | $ | 8,118 | $ | 1,992 | $ | 10,110 | ||||||||
Provision for (reversal of) loan losses | 70 | (1,014 | ) | (944 | ) | 186 | 537 | 723 | ||||||||||||
Charge-offs | (694 | ) | — | (694 | ) | (1,204 | ) | — | (1,204 | ) | ||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
Ending balance allocated to: | ||||||||||||||||||||
Collectively evaluated for impairment | 3,692 | -1 | — | 3,692 | -1 | 7,100 | -2 | — | 7,100 | |||||||||||
Acquired with deteriorated credit quality | — | 1,188 | 1,188 | — | 2,529 | 2,529 | ||||||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
Six Months Ended June 30, | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Covered | PCI Covered | Covered | PCI Covered | |||||||||||||||||
Advances | Loans | Total | Advances | Loans | Total | |||||||||||||||
(In thousands) | ||||||||||||||||||||
Beginning balance | $ | 5,476 | $ | 2,269 | $ | 7,745 | $ | 5,153 | $ | — | $ | 5,153 | ||||||||
(Reversal of) provision for loan losses | (884 | ) | (1,081 | ) | (1,965 | ) | 3,283 | 2,529 | 5,812 | |||||||||||
Charge-offs | (900 | ) | — | (900 | ) | (1,336 | ) | — | (1,336 | ) | ||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
Ending balance allocated to: | ||||||||||||||||||||
Collectively evaluated for impairment | 3,692 | -1 | — | 3,692 | -1 | 7,100 | -2 | — | 7,100 | |||||||||||
Acquired with deteriorated credit quality | — | 1,188 | 1,188 | — | 2,529 | 2,529 | ||||||||||||||
Ending balance | $ | 3,692 | -1 | $ | 1,188 | $ | 4,880 | $ | 7,100 | -2 | $ | 2,529 | $ | 9,629 | ||||||
(1) $2.6 million, $666 thousand, $282 thousand and $167 thousand of allowance for loan losses are allocated to commercial and industrial, commercial real estate, consumer and residential loans, respectively. | ||||||||||||||||||||
(2) $4.1 million, $2.4 million, $407 thousand and $174 thousand of allowance for loan losses are allocated to commercial and industrial, commercial real estate, consumer and residential loans, respectively. |
NONCOVERED_LOANS_AND_ALLOWANCE1
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 6 Months Ended | |||||||||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||||||||
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES | ' | |||||||||||||||||||||||||
Schedule of composition of loans receivable, excluding covered loans | ' | |||||||||||||||||||||||||
June 30, | December 31, | |||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 3,316,581 | $ | 3,192,875 | ||||||||||||||||||||||
Multifamily | 1,133,146 | 992,434 | ||||||||||||||||||||||||
Total residential | 4,449,727 | 4,185,309 | ||||||||||||||||||||||||
Commercial Real Estate (“CRE”): | ||||||||||||||||||||||||||
Income producing | 5,358,710 | 4,301,030 | ||||||||||||||||||||||||
Construction | 233,105 | 140,186 | ||||||||||||||||||||||||
Land | 206,488 | 143,861 | ||||||||||||||||||||||||
Total CRE | 5,798,303 | 4,585,077 | ||||||||||||||||||||||||
Commercial and Industrial (“C&I”): | ||||||||||||||||||||||||||
Commercial business | 5,956,607 | 4,637,056 | ||||||||||||||||||||||||
Trade finance | 716,696 | 723,137 | ||||||||||||||||||||||||
Total C&I | 6,673,303 | 5,360,193 | ||||||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 139,736 | 679,220 | ||||||||||||||||||||||||
Other consumer | 1,216,699 | 868,518 | ||||||||||||||||||||||||
Total consumer | 1,356,435 | 1,547,738 | ||||||||||||||||||||||||
Total loans receivable, excluding covered loans (1) | 18,277,768 | 15,678,317 | ||||||||||||||||||||||||
Unearned fees, premiums, and discounts, net | (5,589 | ) | (23,672 | ) | ||||||||||||||||||||||
Allowance for loan losses, excluding covered loans | (246,468 | ) | (241,930 | ) | ||||||||||||||||||||||
Loans receivable, excluding covered loans, net | $ | 18,025,711 | $ | 15,412,715 | ||||||||||||||||||||||
(1) Loans net of ASC 310-30 discount. | ||||||||||||||||||||||||||
Summary of credit risk rating categories for the non-covered loans | ' | |||||||||||||||||||||||||
Special | ||||||||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 3,297,111 | $ | 7,708 | $ | 11,762 | $ | — | $ | 3,316,581 | ||||||||||||||||
Multifamily | 1,075,296 | — | 57,850 | — | 1,133,146 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 5,056,988 | 74,904 | 225,774 | 1,044 | 5,358,710 | |||||||||||||||||||||
Construction | 220,057 | 6,160 | 6,888 | — | 233,105 | |||||||||||||||||||||
Land | 178,005 | 6,438 | 22,045 | — | 206,488 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 5,627,827 | 101,399 | 226,993 | 388 | 5,956,607 | |||||||||||||||||||||
Trade finance | 650,525 | 53,821 | 12,350 | — | 716,696 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 136,553 | 643 | 2,540 | — | 139,736 | |||||||||||||||||||||
Other consumer | 1,213,739 | 368 | 2,592 | — | 1,216,699 | |||||||||||||||||||||
Total | $ | 17,456,101 | $ | 251,441 | $ | 568,794 | $ | 1,432 | $ | 18,277,768 | ||||||||||||||||
Special | ||||||||||||||||||||||||||
Pass/Watch | Mention | Substandard | Doubtful | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 3,167,337 | $ | 8,331 | $ | 17,207 | $ | — | $ | 3,192,875 | ||||||||||||||||
Multifamily | 923,697 | 1,634 | 67,103 | — | 992,434 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 4,032,269 | 56,752 | 212,009 | — | 4,301,030 | |||||||||||||||||||||
Construction | 127,138 | 6,160 | 6,888 | — | 140,186 | |||||||||||||||||||||
Land | 116,000 | 9,304 | 18,557 | — | 143,861 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 4,400,847 | 92,315 | 143,894 | — | 4,637,056 | |||||||||||||||||||||
Trade finance | 681,345 | 22,099 | 19,693 | — | 723,137 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 677,094 | 445 | 1,681 | — | 679,220 | |||||||||||||||||||||
Other consumer | 865,752 | 244 | 2,522 | — | 868,518 | |||||||||||||||||||||
Total | $ | 14,991,479 | $ | 197,284 | $ | 489,554 | $ | — | $ | 15,678,317 | ||||||||||||||||
Aging analysis of the Company's non-covered loans and loans held for sale | ' | |||||||||||||||||||||||||
Accruing | Accruing | Total | Nonaccrual | Nonaccrual | Total | |||||||||||||||||||||
Loans | Loans | Accruing | Loans Less | Loans | Nonaccrual | Current | ||||||||||||||||||||
30-59 Days | 60-89 Days | Past Due | Than 90 Days | 90 or More | Past Due | Accruing | ||||||||||||||||||||
Past Due | Past Due | Loans | Past Due | Days Past Due | Loans | Loans | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 8,223 | $ | 743 | $ | 8,966 | $ | 2,844 | $ | 5,637 | $ | 8,481 | $ | 3,299,134 | $ | 3,316,581 | ||||||||||
Multifamily | 4,514 | 932 | 5,446 | 14,385 | 11,113 | 25,498 | 1,102,202 | 1,133,146 | ||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 18,072 | 7,619 | 25,691 | 31,025 | 12,121 | 43,146 | 5,289,873 | 5,358,710 | ||||||||||||||||||
Construction | — | — | — | — | 6,888 | 6,888 | 226,217 | 233,105 | ||||||||||||||||||
Land | 2,125 | 96 | 2,221 | 1,467 | 5,970 | 7,437 | 196,830 | 206,488 | ||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 3,047 | 4,590 | 7,637 | 7,600 | 16,151 | 23,751 | 5,925,219 | 5,956,607 | ||||||||||||||||||
Trade finance | — | — | — | — | 222 | 222 | 716,474 | 716,696 | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 599 | 643 | 1,242 | — | 2,540 | 2,540 | 135,954 | 139,736 | ||||||||||||||||||
Other consumer | 1,798 | 11 | 1,809 | 2 | 957 | 959 | 1,213,931 | 1,216,699 | ||||||||||||||||||
Loans held for sale | — | — | — | — | — | — | 450,864 | 450,864 | ||||||||||||||||||
Total (1) | $ | 38,378 | $ | 14,634 | $ | 53,012 | $ | 57,323 | $ | 61,599 | $ | 118,922 | $ | 18,556,698 | 18,728,632 | |||||||||||
Unearned fees, premiums and discounts, net | (5,589 | ) | ||||||||||||||||||||||||
Total recorded investment in non-covered loans and loans held for sale | $ | 18,723,043 | ||||||||||||||||||||||||
(1) Loans net of ASC 310-30 discount. | ||||||||||||||||||||||||||
Accruing | Accruing | Total | Nonaccrual | Nonaccrual | Total | |||||||||||||||||||||
Loans | Loans | Accruing | Loans Less | Loans | Nonaccrual | Current | ||||||||||||||||||||
30-59 Days | 60-89 Days | Past Due | Than 90 Days | 90 or More | Past Due | Accruing | ||||||||||||||||||||
Past Due | Past Due | Loans | Past Due | Days Past Due | Loans | Loans | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 4,694 | $ | 922 | $ | 5,616 | $ | — | $ | 11,218 | $ | 11,218 | $ | 3,176,041 | $ | 3,192,875 | ||||||||||
Multifamily | 8,580 | 531 | 9,111 | 19,661 | 7,972 | 27,633 | 955,690 | 992,434 | ||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 12,746 | 1,798 | 14,544 | 13,924 | 22,549 | 36,473 | 4,250,013 | 4,301,030 | ||||||||||||||||||
Construction | — | — | — | — | 6,888 | 6,888 | 133,298 | 140,186 | ||||||||||||||||||
Land | — | — | — | 265 | 3,223 | 3,488 | 140,373 | 143,861 | ||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 3,428 | 6,259 | 9,687 | 6,437 | 15,486 | 21,923 | 4,605,446 | 4,637,056 | ||||||||||||||||||
Trade finance | — | — | — | — | 909 | 909 | 722,228 | 723,137 | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 541 | 445 | 986 | — | 1,681 | 1,681 | 676,553 | 679,220 | ||||||||||||||||||
Other consumer | 293 | 1 | 294 | 175 | 1,263 | 1,438 | 866,786 | 868,518 | ||||||||||||||||||
Loans held for sale | — | — | — | — | — | — | 204,970 | 204,970 | ||||||||||||||||||
Total | $ | 30,282 | $ | 9,956 | $ | 40,238 | $ | 40,462 | $ | 71,189 | $ | 111,651 | $ | 15,731,398 | 15,883,287 | |||||||||||
Unearned fees, premiums and discounts, net | (23,672 | ) | ||||||||||||||||||||||||
Total recorded investment in non-covered loans and loans held for sale | $ | 15,859,615 | ||||||||||||||||||||||||
Summary of new troubled debt restructurings modifications on non-covered loans portfolio | ' | |||||||||||||||||||||||||
Loans Modified as TDRs During the Three Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Pre-Modification | Post-Modification | Pre-Modification | Post-Modification | |||||||||||||||||||||||
Number | Outstanding | Outstanding | Number | Outstanding | Outstanding | |||||||||||||||||||||
of | Recorded | Recorded | Financial | of | Recorded | Recorded | Financial | |||||||||||||||||||
Contracts | Investment | Investment (1) | Impact (2) | Contracts | Investment | Investment (1) | Impact (2) | |||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | 1 | $ | 1,032 | $ | 1,030 | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Multifamily | 1 | $ | 2,513 | $ | 2,973 | $ | — | 1 | $ | 1,093 | $ | 1,093 | $ | — | ||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 2 | $ | 5,318 | $ | 5,254 | $ | — | 4 | $ | 23,167 | $ | 22,934 | $ | 102 | ||||||||||||
Construction | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Land | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 2 | $ | 1,165 | $ | 1,155 | $ | 563 | 3 | $ | 1,204 | $ | 1,201 | $ | 86 | ||||||||||||
Trade finance | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Other consumer | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Loans Modified as TDRs During the Six Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Pre-Modification | Post-Modification | Pre-Modification | Post-Modification | |||||||||||||||||||||||
Number | Outstanding | Outstanding | Number | Outstanding | Outstanding | |||||||||||||||||||||
of | Recorded | Recorded | Financial | of | Recorded | Recorded | Financial | |||||||||||||||||||
Contracts | Investment | Investment (1) | Impact (2) | Contracts | Investment | Investment (1) | Impact (2) | |||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | 4 | $ | 6,855 | $ | 5,105 | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Multifamily | 1 | $ | 2,513 | $ | 2,973 | $ | — | 1 | $ | 1,093 | $ | 1,093 | $ | — | ||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 2 | $ | 5,318 | $ | 5,254 | $ | — | 4 | $ | 23,167 | $ | 22,934 | $ | 102 | ||||||||||||
Construction | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Land | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 7 | $ | 2,886 | $ | 2,828 | $ | 1,811 | 4 | $ | 1,246 | $ | 1,241 | $ | 86 | ||||||||||||
Trade finance | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | $ | — | $ | — | — | $ | — | $ | — | $ | — | ||||||||||||
Other consumer | — | $ | — | $ | — | $ | — | 1 | $ | 651 | $ | 649 | $ | — | ||||||||||||
(1) Includes subsequent payments after modification and reflects the balance as of June 30, 2014 and June 30, 2013. | ||||||||||||||||||||||||||
(2) The financial impact includes charge-offs and specific reserves recorded at modification date. | ||||||||||||||||||||||||||
Troubled debt restructurings that have subsequently defaulted | ' | |||||||||||||||||||||||||
Loans Modified as TDRs that Subsequently Defaulted | ||||||||||||||||||||||||||
During the Three Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Number of | Recorded | Number of | Recorded | |||||||||||||||||||||||
Contracts | Investment | Contracts | Investment | |||||||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | — | $ | — | 1 | $ | 105 | ||||||||||||||||||||
Multifamily | — | $ | — | — | $ | — | ||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | — | $ | — | — | $ | — | ||||||||||||||||||||
Construction | — | $ | — | — | $ | — | ||||||||||||||||||||
Land | — | $ | — | — | $ | — | ||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 1 | $ | 500 | — | $ | — | ||||||||||||||||||||
Trade finance | — | $ | — | — | $ | — | ||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | — | $ | — | ||||||||||||||||||||
Other consumer | — | $ | — | — | $ | — | ||||||||||||||||||||
Loans Modified as TDRs that Subsequently Defaulted | ||||||||||||||||||||||||||
During the Six Months Ended June 30, | ||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||
Number of | Recorded | Number of | Recorded | |||||||||||||||||||||||
Contracts | Investment | Contracts | Investment | |||||||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | — | $ | — | 3 | $ | 2,935 | ||||||||||||||||||||
Multifamily | — | $ | — | — | $ | — | ||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 1 | $ | 2,730 | — | $ | — | ||||||||||||||||||||
Construction | — | $ | — | — | $ | — | ||||||||||||||||||||
Land | — | $ | — | — | $ | — | ||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 1 | $ | 500 | 2 | $ | 500 | ||||||||||||||||||||
Trade finance | — | $ | — | — | $ | — | ||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | — | $ | — | — | $ | — | ||||||||||||||||||||
Other consumer | — | $ | — | — | $ | — | ||||||||||||||||||||
Summary of impaired non-covered loans | ' | |||||||||||||||||||||||||
Recorded | Recorded | |||||||||||||||||||||||||
Unpaid | Investment | Investment | Total | |||||||||||||||||||||||
Principal | With No | With | Recorded | Related | ||||||||||||||||||||||
Balance | Allowance | Allowance | Investment (1) | Allowance | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
As of June 30, 2014 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 16,220 | $ | 13,427 | $ | 1,067 | $ | 14,494 | $ | 192 | ||||||||||||||||
Multifamily | 39,108 | 27,617 | 9,139 | 36,756 | 1,185 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 65,663 | 39,638 | 18,135 | 57,773 | 2,555 | |||||||||||||||||||||
Construction | 6,888 | 6,888 | — | 6,888 | — | |||||||||||||||||||||
Land | 17,059 | 4,217 | 7,865 | 12,082 | 1,991 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 54,236 | 10,497 | 29,182 | 39,679 | 18,645 | |||||||||||||||||||||
Trade finance | 529 | 256 | 273 | 529 | 273 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Other consumer | 763 | 763 | — | 763 | — | |||||||||||||||||||||
Total | $ | 200,466 | $ | 103,303 | $ | 65,661 | $ | 168,964 | $ | 24,841 | ||||||||||||||||
Recorded | Recorded | |||||||||||||||||||||||||
Unpaid | Investment | Investment | Total | |||||||||||||||||||||||
Principal | With No | With | Recorded | Related | ||||||||||||||||||||||
Balance | Allowance | Allowance | Investment (1) | Allowance | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
As of December 31, 2013 | ||||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 15,814 | $ | 13,585 | $ | 1,588 | $ | 15,173 | $ | 207 | ||||||||||||||||
Multifamily | 43,821 | 30,899 | 10,215 | 41,114 | 1,339 | |||||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 73,777 | 39,745 | 25,523 | 65,268 | 5,976 | |||||||||||||||||||||
Construction | 6,888 | 6,888 | — | 6,888 | — | |||||||||||||||||||||
Land | 17,390 | 4,372 | 7,908 | 12,280 | 2,082 | |||||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 48,482 | 10,850 | 27,487 | 38,337 | 13,787 | |||||||||||||||||||||
Trade finance | 2,771 | 438 | 752 | 1,190 | 752 | |||||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Student loans | 1,749 | 1,681 | — | 1,681 | — | |||||||||||||||||||||
Other consumer | 1,945 | 1,546 | — | 1,546 | — | |||||||||||||||||||||
Total | $ | 212,637 | $ | 110,004 | $ | 73,473 | $ | 183,477 | $ | 24,143 | ||||||||||||||||
(1) Excludes $14.3 million and $17.7 million of covered non-accrual loans at June 30, 2014 and December 31, 2013, respectively, accounted for under ASC 310-10, of which some loans have additional partial balances accounted for under ASC 310-30. | ||||||||||||||||||||||||||
Schedule of average recorded investment in impaired loans and the amount of interest income recognized on impaired loans by portfolio segment | ' | |||||||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||
Average | Recognized | Average | Recognized | Average | Recognized | Average | Recognized | |||||||||||||||||||
recorded | interest | recorded | interest | recorded | interest | recorded | interest | |||||||||||||||||||
investment | income (1) | investment | income (1) | investment | income (1) | investment | income (1) | |||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||
Residential: | ||||||||||||||||||||||||||
Single-family | $ | 15,131 | $ | 65 | $ | 11,219 | $ | 38 | $ | 14,034 | $ | 115 | $ | 11,497 | $ | 77 | ||||||||||
Multifamily | 36,683 | 184 | 45,230 | 247 | 36,817 | 360 | 45,407 | 456 | ||||||||||||||||||
CRE: | ||||||||||||||||||||||||||
Income producing | 59,121 | 303 | 57,105 | 1,529 | 59,917 | 627 | 58,098 | 1,738 | ||||||||||||||||||
Construction | 6,888 | — | 6,888 | — | 6,888 | — | 6,888 | — | ||||||||||||||||||
Land | 12,128 | 75 | 13,231 | 124 | 12,179 | 149 | 13,285 | 247 | ||||||||||||||||||
C&I: | ||||||||||||||||||||||||||
Commercial business | 41,592 | 211 | 23,448 | 59 | 42,682 | 414 | 24,200 | 104 | ||||||||||||||||||
Trade finance | 546 | 4 | 2,052 | 4 | 559 | 8 | 2,367 | 7 | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||||
Other consumer | 755 | 13 | 1,555 | 7 | 752 | 14 | 1,597 | 14 | ||||||||||||||||||
Total impaired loans (excluding PCI) | $ | 172,844 | $ | 855 | $ | 160,728 | $ | 2,008 | $ | 173,828 | $ | 1,687 | $ | 163,339 | $ | 2,643 | ||||||||||
(1) Includes interest recognized on accruing TDRs. Interest payments received on nonaccrual loans are generally reflected as a reduction of principal and not as interest income. | ||||||||||||||||||||||||||
Allowance for loan losses disclosures | ' | |||||||||||||||||||||||||
Recorded investments in total non-covered loans receivable by portfolio segment, disaggregated by impairment methodology | ' | |||||||||||||||||||||||||
Residential | CRE | C&I | Consumer | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 51,250 | $ | 76,743 | $ | 40,208 | $ | 763 | $ | 168,964 | ||||||||||||||||
Collectively evaluated for impairment | 4,397,218 | 5,665,843 | 6,631,178 | 1,355,672 | 18,049,911 | |||||||||||||||||||||
Acquired with deteriorated credit quality | 1,259 | 55,717 | 1,917 | — | 58,893 | |||||||||||||||||||||
Ending balance | $ | 4,449,727 | $ | 5,798,303 | $ | 6,673,303 | $ | 1,356,435 | $ | 18,277,768 | ||||||||||||||||
Residential | CRE | C&I | Consumer | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 56,287 | $ | 84,436 | $ | 39,527 | $ | 3,227 | $ | 183,477 | ||||||||||||||||
Collectively evaluated for impairment | 4,129,022 | 4,500,641 | 5,320,666 | 1,544,511 | 15,494,840 | |||||||||||||||||||||
Ending balance | $ | 4,185,309 | $ | 4,585,077 | $ | 5,360,193 | $ | 1,547,738 | $ | 15,678,317 | ||||||||||||||||
Summary of the changes in the accretable yield for the PCI loans acquired from MetroCorp | ' | |||||||||||||||||||||||||
Three | Six | |||||||||||||||||||||||||
Months Ended | Months Ended | |||||||||||||||||||||||||
June 30, 2014 | ||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Balance at beginning of period | $ | 6,452 | $ | — | ||||||||||||||||||||||
Additions | — | 6,745 | ||||||||||||||||||||||||
Accretion | (1,509 | ) | (2,265 | ) | ||||||||||||||||||||||
Changes in expected cash flows | 824 | 1,287 | ||||||||||||||||||||||||
Balance at end of period | $ | 5,767 | $ | 5,767 | ||||||||||||||||||||||
Non-covered loans | ' | |||||||||||||||||||||||||
Allowance for loan losses disclosures | ' | |||||||||||||||||||||||||
Summary of the activity in the allowance for loan losses on the non-covered loans | ' | |||||||||||||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||||||||||||||
Beginning balance | $ | 47,827 | $ | 62,739 | $ | 124,201 | $ | 10,851 | $ | — | $ | 245,618 | ||||||||||||||
Provision for loan losses | (2,046 | ) | (1,376 | ) | 10,784 | 753 | 829 | 8,944 | ||||||||||||||||||
Provision allocation for unfunded loan commitments and letters of credit | — | — | — | — | (829 | ) | (829 | ) | ||||||||||||||||||
Charge-offs | (61 | ) | (1,314 | )(1) | (6,899 | ) | (2 | ) | — | (8,276 | ) | |||||||||||||||
Recoveries | 63 | 551 | 393 | 4 | — | 1,011 | ||||||||||||||||||||
Net recoveries/(charge-offs) | 2 | (763 | ) | (6,506 | ) | 2 | — | (7,265 | ) | |||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,377 | $ | 4,546 | $ | 18,918 | $ | — | $ | — | $ | 24,841 | ||||||||||||||
Collectively evaluated for impairment | 44,406 | 55,684 | 109,561 | 11,606 | 221,257 | |||||||||||||||||||||
Acquired with deteriorated credit quality | — | 370 | — | — | — | 370 | ||||||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Three Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Beginning balance | $ | 46,880 | $ | 72,958 | $ | 102,346 | $ | 6,612 | $ | — | $ | 228,796 | ||||||||||||||
Provision for loan losses | 704 | (426 | ) | 6,241 | 2,190 | (432 | ) | 8,277 | ||||||||||||||||||
Provision allocation for unfunded loan commitments and letters of credit | — | — | — | — | 432 | 432 | ||||||||||||||||||||
Charge-offs | (550 | ) | (762 | ) | (3,816 | ) | (865 | ) | — | (5,993 | ) | |||||||||||||||
Recoveries | 303 | 1,060 | 605 | — | — | 1,968 | ||||||||||||||||||||
Net (charge-offs)/recoveries | (247 | ) | 298 | (3,211 | ) | (865 | ) | — | (4,025 | ) | ||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,508 | $ | 7,931 | $ | 3,708 | $ | — | $ | — | $ | 13,147 | ||||||||||||||
Collectively evaluated for impairment | 45,829 | 64,899 | 101,668 | 7,937 | — | 220,333 | ||||||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Six Months Ended June 30, 2014 | ||||||||||||||||||||||||||
Beginning balance | $ | 50,717 | $ | 64,677 | $ | 115,184 | $ | 11,352 | $ | — | $ | 241,930 | ||||||||||||||
Provision for loan losses | (4,790 | ) | (3,823 | ) | 24,215 | 252 | 1,044 | 16,898 | ||||||||||||||||||
Allowance for unfunded loan commitments and letters of credit | — | — | — | — | (1,044 | ) | (1,044 | ) | ||||||||||||||||||
Charge-offs | (343 | ) | (1,634 | )(1) | (12,224 | ) | (5 | ) | — | (14,206 | ) | |||||||||||||||
Recoveries | 199 | 1,380 | 1,304 | 7 | — | 2,890 | ||||||||||||||||||||
Net (charge-offs)/recoveries | (144 | ) | (254 | ) | (10,920 | ) | 2 | — | (11,316 | ) | ||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,377 | $ | 4,546 | $ | 18,918 | $ | — | $ | — | $ | 24,841 | ||||||||||||||
Collectively evaluated for impairment | 44,406 | 55,684 | 109,561 | 11,606 | — | 221,257 | ||||||||||||||||||||
Acquired with deteriorated credit quality | — | 370 | — | — | — | 370 | ||||||||||||||||||||
Ending balance | $ | 45,783 | $ | 60,600 | $ | 128,479 | $ | 11,606 | $ | — | $ | 246,468 | ||||||||||||||
Residential | CRE | C&I | Consumer | Unallocated | Total | |||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||
Six Months Ended June 30, 2013 | ||||||||||||||||||||||||||
Beginning balance | $ | 49,349 | $ | 69,856 | $ | 105,376 | $ | 4,801 | $ | — | $ | 229,382 | ||||||||||||||
Provision for loan losses | (2,222 | ) | 3,392 | 3,941 | 3,552 | (1,148 | ) | 7,515 | ||||||||||||||||||
Allowance for unfunded loan commitments and letters of credit | — | — | — | — | 1,148 | 1,148 | ||||||||||||||||||||
Charge-offs | (861 | ) | (1,767 | ) | (5,077 | ) | (1,211 | ) | — | (8,916 | ) | |||||||||||||||
Recoveries | 1,071 | 1,349 | 1,136 | 795 | — | 4,351 | ||||||||||||||||||||
Net recoveries/(charge-offs) | 210 | (418 | ) | (3,941 | ) | (416 | ) | — | (4,565 | ) | ||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
Ending balance allocated to: | ||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 1,508 | $ | 7,931 | $ | 3,708 | $ | — | $ | — | $ | 13,147 | ||||||||||||||
Collectively evaluated for impairment | 45,829 | 64,899 | 101,668 | 7,937 | — | 220,333 | ||||||||||||||||||||
Ending balance | $ | 47,337 | $ | 72,830 | $ | 105,376 | $ | 7,937 | $ | — | $ | 233,480 | ||||||||||||||
(1) Includes charge-off of $523 thousand relating to PCI loans acquired from MetroCorp. |
GOODWILL_AND_OTHER_INTANGIBLE_1
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended | ||||
Jun. 30, 2014 | |||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | ||||
Estimated future amortization expense of premiums on acquired deposits | ' | ||||
Amount | |||||
(In thousands) | |||||
Estimated Amortization Expense of Premiums on Acquired Deposits | |||||
Six Months Ending December 31, 2014 | $ | 5,080 | |||
Year Ending December 31, 2015 | 9,234 | ||||
Year Ending December 31, 2016 | 8,086 | ||||
Year Ending December 31, 2017 | 6,935 | ||||
Year Ending December 31, 2018 | 5,883 | ||||
Thereafter | 15,171 | ||||
Total | $ | 50,389 |
STOCKHOLDERS_EQUITY_AND_EARNIN1
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE (Tables) | 6 Months Ended | |||||||||||||||||||
Jun. 30, 2014 | ||||||||||||||||||||
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE | ' | |||||||||||||||||||
Earnings per share calculations | ' | |||||||||||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 83,988 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | — | |||||||||||||||||||
Earnings allocated to participating securities | (119 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 83,869 | 143,187 | $ | 0.59 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 75 | ||||||||||||||||||
Restricted stock units | 51 | 284 | ||||||||||||||||||
Convertible preferred stock | — | — | ||||||||||||||||||
Warrants | — | 143 | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 83,920 | 143,689 | $ | 0.58 | |||||||||||||||
Three Months Ended June 30, 2013 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 74,015 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | (1,714 | ) | ||||||||||||||||||
Earnings allocated to participating securities | (400 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 71,901 | 137,536 | $ | 0.52 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 59 | ||||||||||||||||||
Restricted stock units | 33 | 221 | ||||||||||||||||||
Convertible preferred stock | — | — | ||||||||||||||||||
Warrants | — | — | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 71,934 | 137,816 | $ | 0.52 | |||||||||||||||
Six Months Ended June 30, 2014 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 160,729 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | — | |||||||||||||||||||
Earnings allocated to participating securities | (287 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 160,442 | 142,578 | $ | 1.13 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 77 | ||||||||||||||||||
Restricted stock units | 129 | 359 | ||||||||||||||||||
Convertible preferred stock | — | — | ||||||||||||||||||
Warrants | — | 144 | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 160,571 | 143,158 | $ | 1.12 | |||||||||||||||
Six Months Ended June 30, 2013 | ||||||||||||||||||||
Net Income | Number of Shares | Per Share Amounts | ||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 146,106 | ||||||||||||||||||
Less: | ||||||||||||||||||||
Preferred stock dividends | (3,428 | ) | ||||||||||||||||||
Earnings allocated to participating securities | (988 | ) | ||||||||||||||||||
Basic EPS — income allocated to common stockholders | $ | 141,690 | 137,592 | $ | 1.03 | |||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||
Stock options | — | 55 | ||||||||||||||||||
Restricted stock units | 68 | 227 | ||||||||||||||||||
Convertible preferred stock | 3,428 | 3,699 | ||||||||||||||||||
Warrants | — | — | ||||||||||||||||||
Diluted EPS — income allocated to common stockholders | $ | 145,186 | 141,573 | $ | 1.03 | |||||||||||||||
Shares excluded from the calculation of diluted EPS | ' | |||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
(In thousands) | ||||||||||||||||||||
Convertible preferred stock | — | 1,841 | — | — | ||||||||||||||||
Stock options | — | 159 | 40 | 214 | ||||||||||||||||
Restricted stock units | 2 | 6 | 61 | 4 | ||||||||||||||||
Schedule of cumulative other comprehensive income (loss) balances | ' | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Cumulative | Cumulative | |||||||||||||||||||
Investment | Other | Investment | Other | |||||||||||||||||
Securities | Other | Comprehensive | Securities | Other | Comprehensive | |||||||||||||||
Available-for-Sale | Investments | Income | Available-for-Sale | Investments | Income | |||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||
Three Months Ended June 30, | ||||||||||||||||||||
Balance, beginning of the period | $ | (17,099 | ) | $ | 62 | $ | (17,037 | ) | $ | 6,149 | $ | 36 | $ | 6,185 | ||||||
Net unrealized gains (losses) arising during period | 14,895 | (4 | ) | 14,891 | (24,770 | ) | 7 | (24,763 | ) | |||||||||||
Less: reclassification adjustment for gains included in net income | (389 | ) | — | $ | (389 | ) | (3,100 | ) | — | (3,100 | ) | |||||||||
Net unrealized gains (losses) | 14,506 | (4 | ) | 14,502 | (27,870 | ) | 7 | (27,863 | ) | |||||||||||
Balance, end of the period | $ | (2,593 | ) | $ | 58 | $ | (2,535 | ) | $ | (21,721 | ) | $ | 43 | $ | (21,678 | ) | ||||
Six Months Ended June 30, | ||||||||||||||||||||
Balance, beginning of the period | $ | (30,538 | ) | 79 | $ | (30,459 | ) | $ | 4,643 | $ | 26 | $ | 4,669 | |||||||
Net unrealized gains (losses) arising during period | 30,317 | (21 | ) | 30,296 | (20,029 | ) | 17 | (20,012 | ) | |||||||||||
Less: reclassification adjustment for gains included in net income | (2,372 | ) | — | (2,372 | ) | (6,335 | ) | — | (6,335 | ) | ||||||||||
Net unrealized gains (losses) | 27,945 | (21 | ) | 27,924 | (26,364 | ) | 17 | (26,347 | ) | |||||||||||
Balance, end of the period | $ | (2,593 | ) | $ | 58 | $ | (2,535 | ) | $ | (21,721 | ) | $ | 43 | $ | (21,678 | ) | ||||
Schedule of components of other comprehensive income (loss), reclassifications to net income by income statement line item and the related tax effects | ' | |||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
Tax | Tax | |||||||||||||||||||
Before-Tax | Expense | Net-of-Tax | Before-Tax | Expense | Net-of-Tax | |||||||||||||||
Three Months Ended June 30, | Amount | or Benefit | Amount | Amount | or Benefit | Amount | ||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||
Unrealized gains (losses) on investment securities available-for-sale: | ||||||||||||||||||||
Net unrealized gains (losses) arising during period | $ | 25,681 | $ | (10,786 | ) | $ | 14,895 | $ | (42,707 | ) | $ | 17,937 | $ | (24,770 | ) | |||||
Less: reclassification adjustment for gains included in net income (1) | (671 | ) | 282 | (389 | ) | (5,345 | ) | 2,245 | (3,100 | ) | ||||||||||
Net unrealized gains (losses) | 25,010 | (10,504 | ) | 14,506 | (48,052 | ) | 20,182 | (27,870 | ) | |||||||||||
Unrealized gains (losses) on other investments | ||||||||||||||||||||
Net unrealized (losses) gains arising during period | (7 | ) | 3 | (4 | ) | 12 | (5 | ) | 7 | |||||||||||
Less: reclassification adjustment for (gains) losses included in income | — | — | — | — | — | — | ||||||||||||||
Other comprehensive income (loss) | $ | 25,003 | $ | (10,501 | ) | $ | 14,502 | $ | (48,040 | ) | $ | 20,177 | $ | (27,863 | ) | |||||
Tax | Tax | |||||||||||||||||||
Before-Tax | Expense | Net-of-Tax | Before-Tax | Expense | Net-of-Tax | |||||||||||||||
Six Months Ended June 30, | Amount | or Benefit | Amount | Amount | or Benefit | Amount | ||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||
Unrealized gains (losses) on investment securities available-for-sale: | ||||||||||||||||||||
Net unrealized gains (losses) arising during period | $ | 52,271 | $ | (21,954 | ) | $ | 30,317 | $ | (34,533 | ) | $ | 14,504 | $ | (20,029 | ) | |||||
Less: reclassification adjustment for gains included in net income (1) | (4,089 | ) | 1,717 | (2,372 | ) | (10,922 | ) | 4,587 | (6,335 | ) | ||||||||||
Net unrealized gains (losses) | 48,182 | (20,237 | ) | 27,945 | (45,455 | ) | 19,091 | (26,364 | ) | |||||||||||
Unrealized gains (losses) on other investments | ||||||||||||||||||||
Net unrealized (losses) gains arising during period | (36 | ) | 15 | (21 | ) | 29 | (12 | ) | 17 | |||||||||||
Less: reclassification adjustment for (gains) losses included in income | — | — | — | — | — | — | ||||||||||||||
Other comprehensive income (loss) | $ | 48,146 | $ | (20,222 | ) | $ | 27,924 | $ | (45,426 | ) | $ | 19,079 | $ | (26,347 | ) | |||||
(1) The pretax amount is reported in net gains on sales of investment securities in the consolidated statements of operations. |
BUSINESS_SEGMENTS_Tables
BUSINESS SEGMENTS (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
BUSINESS SEGMENTS | ' | |||||||||||||
Operating results and key financial measures for operating segments | ' | |||||||||||||
Three Months Ended June 30, 2014 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 99,792 | $ | 181,880 | $ | 12,770 | $ | 294,442 | ||||||
Charge for funds used | (23,854 | ) | (34,281 | ) | (9,929 | ) | (68,064 | ) | ||||||
Interest spread on funds used | 75,938 | 147,599 | 2,841 | 226,378 | ||||||||||
Interest expense | (11,950 | ) | (3,421 | ) | (12,621 | ) | (27,992 | ) | ||||||
Credit on funds provided | 54,139 | 8,983 | 4,942 | 68,064 | ||||||||||
Interest spread on funds provided | 42,189 | 5,562 | (7,679 | ) | 40,072 | |||||||||
Net interest income (loss) | $ | 118,127 | $ | 153,161 | $ | (4,838 | ) | $ | 266,450 | |||||
Provision for loan losses | $ | (440 | ) | $ | 8,440 | $ | — | $ | 8,000 | |||||
Depreciation, amortization and accretion | 4,096 | (1,286 | ) | 19,508 | 22,318 | |||||||||
Goodwill | 354,163 | 104,304 | — | 458,467 | ||||||||||
Segment pre-tax profit (loss) | 45,691 | 73,987 | (4,072 | ) | 115,606 | |||||||||
Segment assets | $ | 7,822,020 | $ | 14,177,634 | $ | 5,557,451 | $ | 27,557,105 | ||||||
Three Months Ended June 30, 2013 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 93,928 | $ | 147,168 | $ | 14,257 | $ | 255,353 | ||||||
Charge for funds used | (17,901 | ) | (27,883 | ) | 156 | (45,628 | ) | |||||||
Interest spread on funds used | 76,027 | 119,285 | 14,413 | 209,725 | ||||||||||
Interest expense | (11,708 | ) | (3,940 | ) | (12,061 | ) | (27,709 | ) | ||||||
Credit on funds provided | 36,022 | 5,711 | 3,895 | 45,628 | ||||||||||
Interest spread on funds provided | 24,314 | 1,771 | (8,166 | ) | 17,919 | |||||||||
Net interest income | $ | 100,341 | $ | 121,056 | $ | 6,247 | $ | 227,644 | ||||||
Provision for loan losses | $ | 2,886 | $ | 6,114 | $ | — | $ | 9,000 | ||||||
Depreciation, amortization and accretion | 5,865 | 3,445 | 14,602 | 23,912 | ||||||||||
Goodwill | 320,566 | 16,872 | — | 337,438 | ||||||||||
Segment pre-tax profit | 32,493 | 65,514 | 13,863 | 111,870 | ||||||||||
Segment assets | $ | 7,035,908 | $ | 10,903,753 | $ | 5,368,745 | $ | 23,308,406 | ||||||
Six Months Ended June 30, 2014 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 198,517 | $ | 350,956 | $ | 31,142 | $ | 580,615 | ||||||
Charge for funds used | (48,150 | ) | (66,098 | ) | (14,312 | ) | (128,560 | ) | ||||||
Interest spread on funds used | 150,367 | 284,858 | 16,830 | 452,055 | ||||||||||
Interest expense | (23,661 | ) | (6,701 | ) | (25,837 | ) | (56,199 | ) | ||||||
Credit on funds provided | 102,332 | 17,419 | 8,809 | 128,560 | ||||||||||
Interest spread on funds provided | 78,671 | 10,718 | (17,028 | ) | 72,361 | |||||||||
Net interest income (loss) | $ | 229,038 | $ | 295,576 | $ | (198 | ) | $ | 524,416 | |||||
Provision for loan losses | $ | 2,212 | $ | 12,721 | $ | — | $ | 14,933 | ||||||
Depreciation, amortization and accretion | 6,667 | (4,614 | ) | 33,801 | 35,854 | |||||||||
Goodwill | 354,163 | 104,304 | — | 458,467 | ||||||||||
Segment pre-tax profit (loss) | 88,022 | 148,718 | (9,444 | ) | 227,296 | |||||||||
Segment assets | $ | 7,822,020 | $ | 14,177,634 | $ | 5,557,451 | $ | 27,557,105 | ||||||
Six Months Ended June 30, 2013 | ||||||||||||||
Retail | Commercial | |||||||||||||
Banking | Banking | Other | Total | |||||||||||
(In thousands) | ||||||||||||||
Interest income | $ | 176,767 | $ | 287,228 | $ | 29,781 | $ | 493,776 | ||||||
Charge for funds used | (37,885 | ) | (55,956 | ) | 9,429 | (84,412 | ) | |||||||
Interest spread on funds used | 138,882 | 231,272 | 39,210 | 409,364 | ||||||||||
Interest expense | (24,353 | ) | (8,317 | ) | (24,171 | ) | (56,841 | ) | ||||||
Credit on funds provided | 68,418 | 9,334 | 6,660 | 84,412 | ||||||||||
Interest spread on funds provided | 44,065 | 1,017 | (17,511 | ) | 27,571 | |||||||||
Net interest income | $ | 182,947 | $ | 232,289 | $ | 21,699 | $ | 436,935 | ||||||
Provision for loan losses | $ | 6,566 | $ | 6,761 | $ | — | $ | 13,327 | ||||||
Depreciation, amortization and accretion | 8,286 | 626 | 29,997 | 38,909 | ||||||||||
Goodwill | 320,566 | 16,872 | — | 337,438 | ||||||||||
Segment pre-tax profit | 51,420 | 132,195 | 34,765 | 218,380 | ||||||||||
Segment assets | $ | 7,035,908 | $ | 10,903,753 | $ | 5,368,745 | $ | 23,308,406 |
BASIS_OF_PRESENTATION_Details
BASIS OF PRESENTATION (Details) | 3 Months Ended |
Mar. 31, 2014 | |
item | |
trust | |
BASIS OF PRESENTATION | ' |
Number of wholly owned subsidiaries that are statutory business trusts | 6 |
Number of acquisitions | 1 |
BUSINESS_COMBINATION_Details
BUSINESS COMBINATION (Details) (USD $) | 6 Months Ended | 0 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2013 | Jan. 17, 2014 | Jun. 30, 2014 | |
MetroCorp | MetroCorp | ||||
item | |||||
Business combination | ' | ' | ' | ' | ' |
Number of branches | ' | ' | ' | ' | 19 |
Number of subsidiaries | ' | ' | ' | ' | 2 |
Percentage of purchase consideration satisfied in stock | ' | ' | ' | 66.67% | ' |
Percentage of purchase consideration satisfied in cash | ' | ' | ' | 33.33% | ' |
Fair value of the consideration transferred | ' | ' | ' | $291,400,000 | ' |
Consideration transferred in the acquisition (in shares) | 5,583,093 | ' | ' | 5,583,093 | ' |
Fair value of common stock issued as part of consideration transferred | 190,830,000 | ' | ' | 190,800,000 | ' |
Consideration transferred in cash | ' | ' | ' | 89,400,000 | ' |
Additional cash given to acquiree's stock option holders as part of consideration transferred | ' | ' | ' | 2,400,000 | ' |
Amount given for warrant's assumed as part of consideration transferred | ' | ' | ' | 8,800,000 | ' |
Goodwill recorded as a result of the business combination | 458,467,000 | 337,438,000 | 337,438,000 | 121,000,000 | ' |
Fair value of assets acquired | ' | ' | ' | 1,700,000,000 | ' |
Cash and due from banks | ' | ' | ' | 230,300,000 | ' |
Investment securities available for sale | ' | ' | ' | 64,300,000 | ' |
FHLB stock | ' | ' | ' | 2,700,000 | ' |
Loans receivable | ' | ' | ' | 1,190,000,000 | ' |
Fixed assets | ' | ' | ' | 8,600,000 | ' |
Premiums on deposits acquired | ' | ' | ' | 8,600,000 | ' |
OREO | ' | ' | ' | 9,400,000 | ' |
Bank owned life insurance | ' | ' | ' | 30,000,000 | ' |
Deferred tax assets | ' | ' | ' | 13,000,000 | ' |
Other assets | ' | ' | ' | 16,700,000 | ' |
Fair value of liabilities acquired | ' | ' | ' | 1,410,000,000 | ' |
Deposits | ' | ' | ' | 1,320,000,000 | ' |
FHLB advances | ' | ' | ' | 10,000,000 | ' |
Repurchase agreements | ' | ' | ' | 25,900,000 | ' |
Junior subordinated debts | ' | ' | ' | 29,100,000 | ' |
Other liabilities | ' | ' | ' | $22,700,000 | ' |
FAIR_VALUE_Details
FAIR VALUE (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | $2,529,652 | $2,733,797 | ||
U.S. Treasury securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 449,312 | 491,632 | ||
U.S. government agency and U.S. government sponsored enterprise debt securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 438,599 | 394,323 | ||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Commercial mortgage-backed securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 111,757 | 178,870 | ||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Residential mortgage-backed securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 797,966 | 885,237 | ||
Municipal securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 289,479 | 280,979 | ||
Other residential mortgage-backed securities: | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 57,206 | 46,327 | ||
Other commercial mortgage-backed securities: | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 51,463 | 51,617 | ||
Corporate debt securities | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 210,870 | 309,995 | ||
Corporate debt securities | Non-investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 16,579 | [1] | 15,101 | [1] |
Other securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 106,421 | 79,716 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 2,529,652 | 2,733,797 | ||
Derivative | ' | ' | ||
Derivatives liabilities | -48,388 | -50,262 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Foreign exchange options | ' | ' | ||
Derivative | ' | ' | ||
Derivative assets | 6,049 | 6,290 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Interest rate swaps and caps | ' | ' | ||
Derivative | ' | ' | ||
Derivative assets | 30,233 | 28,078 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Foreign exchange contracts | ' | ' | ||
Derivative | ' | ' | ||
Foreign exchange contracts | 4,499 | 6,181 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | U.S. Treasury securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 449,312 | 491,632 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | U.S. government agency and U.S. government sponsored enterprise debt securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 438,599 | 394,323 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Commercial mortgage-backed securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 111,757 | 178,870 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Residential mortgage-backed securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 797,966 | 885,237 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Municipal securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 289,479 | 280,979 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Other residential mortgage-backed securities: | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 57,206 | 46,327 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Other commercial mortgage-backed securities: | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 51,463 | 51,617 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Corporate debt securities | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 210,870 | 309,995 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Corporate debt securities | Non-investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 16,579 | 15,101 | ||
Fair Value, Measurements, Recurring | Fair Value Measurements | Other securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 106,421 | 79,716 | ||
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 449,312 | 491,632 | ||
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 449,312 | 491,632 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 2,072,423 | 2,235,794 | ||
Derivative | ' | ' | ||
Derivatives liabilities | -45,026 | -46,607 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Foreign exchange options | ' | ' | ||
Derivative | ' | ' | ||
Derivative assets | 6,049 | 6,290 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Interest rate swaps and caps | ' | ' | ||
Derivative | ' | ' | ||
Derivative assets | 30,233 | 28,078 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Foreign exchange contracts | ' | ' | ||
Derivative | ' | ' | ||
Foreign exchange contracts | 4,499 | 6,181 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | U.S. government agency and U.S. government sponsored enterprise debt securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 438,599 | 394,323 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Commercial mortgage-backed securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 111,757 | 178,870 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Residential mortgage-backed securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 797,966 | 885,237 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Municipal securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 289,479 | 280,979 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Other residential mortgage-backed securities: | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 57,206 | 46,327 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Other commercial mortgage-backed securities: | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 51,463 | 51,617 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Corporate debt securities | Investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 210,870 | 309,995 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Corporate debt securities | Non-investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 8,662 | 8,730 | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Other securities | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 106,421 | 79,716 | ||
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | 7,917 | 6,371 | ||
Derivative | ' | ' | ||
Derivatives liabilities | -3,362 | -3,655 | ||
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Corporate debt securities | Non-investment grade | ' | ' | ||
Investment securities available-for-sale | ' | ' | ||
Total investment securities available-for-sale | $7,917 | $6,371 | ||
[1] | For the six months ended June 30, 2014 and the year ended December 31, 2013, the Company did not record any OTTI. |
FAIR_VALUE_Details_2
FAIR VALUE (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | ||||
Covered OREO | ' | ' | ' | ' | ||||
Percentage of eligible losses for which the FDIC is obligated to reimburse the Company | 80.00% | 80.00% | 80.00% | 80.00% | ||||
Percentage of company's liability for losses under shared loss agreements | 20.00% | 20.00% | 20.00% | 20.00% | ||||
Fair Value, Measurements, Non-Recurring | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | -7,364 | -1,480 | -10,302 | -6,300 | ||||
Covered OREO | ' | ' | ' | ' | ||||
Company's liability for losses under shared loss agreements | 14 | 200 | 104 | 225 | ||||
Fair Value, Measurements, Non-Recurring | Non-covered OREO | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | ' | -18 | -74 | -1,403 | ||||
Fair Value, Measurements, Non-Recurring | Covered OREO | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | -69 | [1] | -1,000 | [1] | -521 | [2] | -1,126 | [2] |
Fair Value, Measurements, Non-Recurring | Residential | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | 413 | -838 | 27 | -1,274 | ||||
Fair Value, Measurements, Non-Recurring | Commercial real estate | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | 1,865 | -1,320 | 1,376 | -3,422 | ||||
Fair Value, Measurements, Non-Recurring | Commercial and Industrial ("C&I") | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | -9,642 | 674 | -11,705 | -1,492 | ||||
Fair Value, Measurements, Non-Recurring | Consumer | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Total gains (losses) | ' | 4 | ' | -112 | ||||
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 50,503 | 66,936 | 50,503 | 66,936 | ||||
Non-covered loans | 41,074 | 60,384 | 41,074 | 60,384 | ||||
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | Non-covered OREO | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered OREO | 676 | 435 | 676 | 435 | ||||
Non-covered OREO | 676 | 13,238 | 676 | 13,238 | ||||
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | Covered OREO | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Covered OREO | 4,009 | [1] | 7,500 | [1] | 4,009 | [1] | 7,500 | [1] |
Covered OREO | 4,009 | [2] | 11,030 | [2] | 4,009 | [2] | 11,030 | [2] |
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | Residential | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 17,908 | 22,012 | 17,908 | 22,012 | ||||
Non-covered loans | 9,800 | 19,971 | 9,800 | 19,971 | ||||
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | Commercial real estate | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 22,758 | 35,349 | 22,758 | 35,349 | ||||
Non-covered loans | 22,333 | 30,397 | 22,333 | 30,397 | ||||
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | Commercial and Industrial ("C&I") | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 9,837 | 9,203 | 9,837 | 9,203 | ||||
Non-covered loans | 8,941 | 9,723 | 8,941 | 9,723 | ||||
Fair Value, Measurements, Non-Recurring | Fair Value Measurements | Consumer | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | ' | 372 | ' | 372 | ||||
Non-covered loans | ' | 293 | ' | 293 | ||||
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 50,503 | 66,936 | 50,503 | 66,936 | ||||
Non-covered loans | 41,074 | 60,384 | 41,074 | 60,384 | ||||
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | Non-covered OREO | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered OREO | 676 | 435 | 676 | 435 | ||||
Non-covered OREO | 676 | 13,238 | 676 | 13,238 | ||||
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | Covered OREO | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Covered OREO | 4,009 | [1] | 7,500 | [1] | 4,009 | [1] | 7,500 | [1] |
Covered OREO | 4,009 | [2] | 11,030 | [2] | 4,009 | [2] | 11,030 | [2] |
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | Residential | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 17,908 | 22,012 | 17,908 | 22,012 | ||||
Non-covered loans | 9,800 | 19,971 | 9,800 | 19,971 | ||||
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | Commercial real estate | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 22,758 | 35,349 | 22,758 | 35,349 | ||||
Non-covered loans | 22,333 | 30,397 | 22,333 | 30,397 | ||||
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | Commercial and Industrial ("C&I") | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | 9,837 | 9,203 | 9,837 | 9,203 | ||||
Non-covered loans | 8,941 | 9,723 | 8,941 | 9,723 | ||||
Fair Value, Measurements, Non-Recurring | Significant Unobservable Inputs (Level 3) | Consumer | ' | ' | ' | ' | ||||
Fair Value, Assets Measured on Nonrecurring Basis | ' | ' | ' | ' | ||||
Non-covered loans | ' | 372 | ' | 372 | ||||
Non-covered loans | ' | 293 | ' | 293 | ||||
[1] | Covered OREO results from the WFIB and UCB FDIC-assisted acquisitions for which the Company entered into shared-loss agreements with the FDIC whereby the FDIC will reimburse the Company for 80% of eligible losses. As such, the Company?s liability for losses is 20% of the $69 thousand in losses, or $14 thousand, and 20% of the $1.0 million in losses, or $200 thousand, for the three months ended June 30, 2014 and 2013, respectively. | |||||||
[2] | Covered OREO results from the WFIB and UCB FDIC-assisted acquisitions for which the Company entered into shared-loss agreements with the FDIC whereby the FDIC will reimburse the Company for 80% of eligible losses. As such, the Company?s liability for losses is 20% of the $521 thousand in losses, or $104 thousand, and 20% of the $1.1 million in losses, or $225 thousand, for the six months ended June 30, 2014 and 2013, respectively. |
FAIR_VALUE_Details_3
FAIR VALUE (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | ||||
Derivative Payable | ' | ' | ' | ' | ||||
Reconciliation of the beginning and ending balances for major liability categories measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | ' | ' | ' | ' | ||||
Beginning balance | ($3,398) | ($3,233) | ($3,655) | ($3,052) | ||||
Total gains or (losses) for the period: | ' | ' | ' | ' | ||||
Included in earnings | 36 | [1] | -24 | [1] | 293 | [1] | -205 | [1] |
Ending balance | -3,362 | -3,257 | -3,362 | -3,257 | ||||
Changes in unrealized gains (losses) included in earnings relating to assets and liabilities held at the end of period | -36 | 24 | -293 | 205 | ||||
Corporate debt securities | Non-investment grade | ' | ' | ' | ' | ||||
Reconciliation of the beginning and ending balances for major asset categories measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | ' | ' | ' | ' | ||||
Opening balance | 6,717 | 5,284 | 6,371 | 4,800 | ||||
Total gains or (losses) for the period: | ' | ' | ' | ' | ||||
Included in other comprehensive income (unrealized) | 1,209 | [1],[2] | 239 | [1],[2] | 1,643 | [1],[2] | 788 | [1],[2] |
Purchases, issues, sales, settlements | ' | ' | ' | ' | ||||
Settlements | -9 | [3] | -6 | [3] | -97 | [3] | -71 | [3] |
Closing balance | $7,917 | $5,517 | $7,917 | $5,517 | ||||
[1] | Total gains or losses represent the total realized and unrealized gains and losses recorded for Level 3 assets and liabilities. Realized gains or losses are reported in the consolidated statements of income. | |||||||
[2] | Unrealized gains or losses on investment securities are reported in accumulated other comprehensive income (loss), net of tax, in the consolidated statements of comprehensive income. | |||||||
[3] | Purchases, issuances, sales, and settlements represent Level 3 assets and liabilities that were either purchased, issued, sold, or settled during the period. The amounts are recorded at their end of period fair values. |
FAIR_VALUE_Details_4
FAIR VALUE (Details 4) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Discount cash flow | Derivative Payable | ' | ' | ' | ' |
Quantitative unobservable assumptions | ' | ' | ' | ' |
Total credit valuation adjustment on derivative liabilities | ' | ' | $933,000 | ' |
Discount cash flow | Derivative Payable | Low end of range | ' | ' | ' | ' |
Quantitative unobservable assumptions | ' | ' | ' | ' |
Credit Risk Adjustment | ' | ' | 0.68% | ' |
Discount cash flow | Derivative Payable | High end of range | ' | ' | ' | ' |
Quantitative unobservable assumptions | ' | ' | ' | ' |
Credit Risk Adjustment | ' | ' | 0.71% | ' |
Trust Preferred Securities | ' | ' | ' | ' |
Quantitative unobservable assumptions | ' | ' | ' | ' |
Other than temporary impairment | $0 | $0 | $0 | $0 |
Trust Preferred Securities | Discount cash flow | ' | ' | ' | ' |
Quantitative unobservable assumptions | ' | ' | ' | ' |
Constant prepayment rate for year 1-5 | ' | ' | 0.00% | ' |
Constant prepayment rate, thereafter | ' | ' | 1.00% | ' |
Constant default rate for year 1-5 | ' | ' | 1.20% | ' |
Constant default rate, thereafter | ' | ' | 0.75% | ' |
Recovery rate, existing deferral/defaults | ' | ' | 0.00% | ' |
Recovery rate, future deferral | ' | ' | 15.00% | ' |
Recovery period, future deferral | ' | ' | '60 months | ' |
FAIR_VALUE_Details_5
FAIR VALUE (Details 5) | 6 Months Ended |
Jun. 30, 2014 | |
Valuation Methodologies | ' |
Number of trust preferred securities included in Level 3 available-for-sale securities | 4 |
Percentage of total available-for-sale securities represented by Level 3 available-for-sale securities, maximum | 1.00% |
Minimum number of quoted market prices traditionally used in determining fair value of level 3 available-for-sale securities | 2 |
Foreign exchange options | ' |
Valuation Methodologies | ' |
Term of contract | '5 years |
FAIR_VALUE_Details_6
FAIR VALUE (Details 6) (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
Financial Assets: | ' | ' |
Investment securities available-for-sale | $2,529,652 | $2,733,797 |
Financial Liabilities: | ' | ' |
Maximum term of maturity for securities purchased under resale agreements to be included in cash and cash equivalents | '90 days | ' |
Term of maturity that securities purchased under resale agreements must exceed to be included in certain fair value calculations | '90 days | ' |
Maximum term of maturity for carrying amount of securities sold under repurchase agreements to approximate fair value | '90 days | ' |
Carrying Amount | ' | ' |
Financial Assets: | ' | ' |
Cash and cash equivalents | 1,246,044 | 895,820 |
Short-term investments | 286,130 | 257,473 |
Securities purchased under resale agreements | 1,275,000 | 1,300,000 |
Investment securities available-for-sale | 2,529,652 | 2,733,797 |
Loans held for sale | 450,864 | 204,970 |
Loans receivable, net | 19,828,801 | 17,600,613 |
Investment in Federal Home Loan Bank stock | 37,731 | 62,330 |
Investment in Federal Reserve Bank stock | 54,217 | 48,333 |
Accrued interest receivable | 100,323 | 116,314 |
Foreign exchange options | 6,049 | 6,290 |
Interest rate swaps and caps | 30,233 | 28,078 |
Foreign exchange contracts | 4,499 | 6,181 |
Financial Liabilities: | ' | ' |
Demand, savings and money market deposits | 16,643,474 | 14,588,570 |
Time deposits | 6,231,615 | 5,824,348 |
Federal Home Loan Bank advances | 316,156 | 315,092 |
Securities sold under repurchase agreements | 1,005,211 | 995,000 |
Accrued interest payable | 11,020 | 11,178 |
Long-term debt | 235,732 | 226,868 |
Derivatives liabilities | 48,388 | 50,262 |
Estimated Fair Value | ' | ' |
Financial Assets: | ' | ' |
Cash and cash equivalents | 1,246,044 | 895,820 |
Short-term investments | 286,130 | 257,473 |
Securities purchased under resale agreements | 1,266,730 | 1,279,406 |
Investment securities available-for-sale | 2,529,652 | 2,733,797 |
Loans held for sale | 462,397 | 212,469 |
Loans receivable, net | 19,211,124 | 16,741,674 |
Investment in Federal Home Loan Bank stock | 37,731 | 62,330 |
Investment in Federal Reserve Bank stock | 54,217 | 48,333 |
Accrued interest receivable | 100,323 | 116,314 |
Foreign exchange options | 6,049 | 6,290 |
Interest rate swaps and caps | 30,233 | 28,078 |
Foreign exchange contracts | 4,499 | 6,181 |
Financial Liabilities: | ' | ' |
Demand, savings and money market deposits | 16,643,474 | 14,588,570 |
Time deposits | 6,212,638 | 5,791,659 |
Federal Home Loan Bank advances | 337,621 | 308,521 |
Securities sold under repurchase agreements | 1,128,491 | 1,134,774 |
Accrued interest payable | 11,020 | 11,178 |
Long-term debt | 204,101 | 184,415 |
Derivatives liabilities | $48,388 | $50,262 |
FAIR_VALUE_Details_7
FAIR VALUE (Details 7) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Estimated Fair Value | ' | ' |
Financial Assets: | ' | ' |
Cash and cash equivalents | $1,246,044 | $895,820 |
Short-term investments | 286,130 | 257,473 |
Securities purchased under resale agreements | 1,266,730 | 1,279,406 |
Loans held for sale | 462,397 | 212,469 |
Loans receivable, net | 19,211,124 | 16,741,674 |
Investment in Federal Home Loan Bank stock | 37,731 | 62,330 |
Investment in Federal Reserve Bank stock | 54,217 | 48,333 |
Accrued interest receivable | 100,323 | 116,314 |
Financial Liabilities: | ' | ' |
Demand, savings and money market deposits | 16,643,474 | 14,588,570 |
Time deposits | 6,212,638 | 5,791,659 |
Federal Home Loan Bank advances | 337,621 | 308,521 |
Securities sold under repurchase agreements | 1,128,491 | 1,134,774 |
Accrued interest payable | 11,020 | 11,178 |
Long-term debt | 204,101 | 184,415 |
Level 1 | ' | ' |
Financial Assets: | ' | ' |
Cash and cash equivalents | 1,246,044 | 895,820 |
Level 2 | ' | ' |
Financial Assets: | ' | ' |
Short-term investments | 286,130 | 257,473 |
Securities purchased under resale agreements | 1,266,730 | 1,279,406 |
Loans held for sale | 462,397 | 212,469 |
Investment in Federal Home Loan Bank stock | 37,731 | 62,330 |
Investment in Federal Reserve Bank stock | 54,217 | 48,333 |
Accrued interest receivable | 100,323 | 116,314 |
Financial Liabilities: | ' | ' |
Demand, savings and money market deposits | 16,643,474 | 14,588,570 |
Federal Home Loan Bank advances | 337,621 | 308,521 |
Securities sold under repurchase agreements | 1,128,491 | 1,134,774 |
Accrued interest payable | 11,020 | 11,178 |
Long-term debt | 204,101 | 184,415 |
Level 3 | ' | ' |
Financial Assets: | ' | ' |
Loans receivable, net | 19,211,124 | 16,741,674 |
Financial Liabilities: | ' | ' |
Time deposits | $6,212,638 | $5,791,659 |
STOCKBASED_COMPENSATION_Detail
STOCK-BASED COMPENSATION (Details) (USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | |
Restricted Stock Awards | Restricted Stock Awards | Stock Options | Stock Options | ||||
Summary of Stock-based Compensation Plans | ' | ' | ' | ' | ' | ' | ' |
Total compensation expense, before taxes | $3,400,000 | ' | $5,900,000 | $3,600,000 | $6,700,000 | ' | ' |
Total compensation expense, net income | 2,000,000 | ' | 3,400,000 | 2,100,000 | 3,900,000 | ' | ' |
Cash proceeds from stock option exercises | ' | ' | ' | ' | ' | 283,000 | 537,000 |
Net tax benefit recognized in equity for stock compensation plans | ' | $3,787,000 | $2,803,000 | ' | ' | ' | ' |
Incentive shares available to be issued | ' | 3,723,456 | ' | ' | ' | ' | ' |
STOCKBASED_COMPENSATION_Detail1
STOCK-BASED COMPENSATION (Details 2) (Stock Options, USD $) | 3 Months Ended | 6 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Summary of stock option activity | ' | ' | ' |
Outstanding at beginning of period (in shares) | ' | 406,731 | ' |
Exercised (in shares) | ' | -13,415 | ' |
Expired (in shares) | ' | -130,514 | ' |
Outstanding at end of period (in shares) | ' | 262,802 | ' |
Vested or expected to vest at end of period (in shares) | ' | 262,802 | ' |
Exercisable at end of period (in shares) | ' | 262,802 | ' |
Outstanding at beginning of period, weighted average exercise price (in dollars per share) | ' | $26.72 | ' |
Exercised, weighted average exercise price (in dollars per share) | ' | $21.09 | ' |
Expired, weighted average exercise price (in dollars per share) | ' | $38.76 | ' |
Outstanding at end of period, weighted average exercise price (in dollars per share) | ' | $21.03 | ' |
Vested or expected to vest at end of period, weighted average exercise price (in dollars per share) | ' | $21.03 | ' |
Exercisable at end of period, weighted average exercise price (in dollars per share) | ' | $21.03 | ' |
Outstanding at end of period, weighted average remaining term | ' | '7 months 24 days | ' |
Vested or expected to vest at end of period, weighted average remaining term | ' | '7 months 24 days | ' |
Exercisable at end of period, weighted average remaining term | ' | '7 months 24 days | ' |
Outstanding at end of period, aggregate intrinsic value | ' | $3,667 | ' |
Vested or expected to vest at end of period, aggregate intrinsic value | ' | 3,667 | ' |
Exercisable at end of period, aggregate intrinsic value | ' | 3,667 | ' |
Share based compensation plan, additional disclosures | ' | ' | ' |
Total intrinsic value of options exercised | 297 | 194 | 424 |
Total fair value of options vested | ' | ' | $363 |
Minimum | ' | ' | ' |
Stock Options | ' | ' | ' |
Vesting period | ' | '3 years | ' |
Contractual term of stock option grants | ' | '7 years | ' |
Maximum | ' | ' | ' |
Stock Options | ' | ' | ' |
Vesting period | ' | '4 years | ' |
Contractual term of stock option grants | ' | '10 years | ' |
STOCKBASED_COMPENSATION_Detail2
STOCK-BASED COMPENSATION (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Restricted Stock Awards | Minimum | ' | ' | ' | ' |
Summary of Stock-based Compensation Plans | ' | ' | ' | ' |
Vesting period | ' | ' | '3 years | ' |
Restricted Stock Awards | Maximum | ' | ' | ' | ' |
Summary of Stock-based Compensation Plans | ' | ' | ' | ' |
Vesting period | ' | ' | '5 years | ' |
Time-based restricted stock awards | ' | ' | ' | ' |
Summary of restricted stock awards activity | ' | ' | ' | ' |
Outstanding unvested at beginning of period (in shares) | ' | ' | 438,508 | ' |
Granted (in shares) | ' | ' | 12,010 | ' |
Vested (in shares) | ' | ' | -153,279 | ' |
Forfeited (in shares) | ' | ' | -17,446 | ' |
Outstanding unvested at end of period (in shares) | 279,793 | ' | 279,793 | ' |
Outstanding unvested at beginning of period, weighted average price (in dollars per share) | ' | ' | $17.79 | ' |
Granted, weighted average price (in dollars per share) | ' | ' | $31.64 | $24.30 |
Vested, weighted average price (in dollars per share) | ' | ' | $11.18 | ' |
Forfeited, weighted average price (in dollars per share) | ' | ' | $19.92 | ' |
Outstanding unvested at end of period, weighted average price (in dollars per share) | $21.87 | ' | $21.87 | ' |
Total fair value of restricted stock awards vested | $587,000 | $772,000 | $5,300,000 | $17,100,000 |
Total unrecognized stock compensation expense | 2,600,000 | ' | 2,600,000 | ' |
Weighted average period to recognize unrecognized compensation cost | ' | ' | '1 year 7 months 6 days | ' |
Performance-based restricted stock awards | ' | ' | ' | ' |
Summary of restricted stock awards activity | ' | ' | ' | ' |
Outstanding unvested at beginning of period (in shares) | ' | ' | 956,707 | ' |
Granted (in shares) | ' | ' | 603,697 | ' |
Vested (in shares) | ' | ' | -340,781 | ' |
Forfeited (in shares) | ' | ' | -28,535 | ' |
Outstanding unvested at end of period (in shares) | 1,191,088 | ' | 1,191,088 | ' |
Outstanding unvested at beginning of period, weighted average price (in dollars per share) | ' | ' | $23.74 | ' |
Granted, weighted average price (in dollars per share) | ' | ' | $36.85 | $25.25 |
Vested, weighted average price (in dollars per share) | ' | ' | $23.52 | ' |
Forfeited, weighted average price (in dollars per share) | ' | ' | $27.22 | ' |
Outstanding unvested at end of period, weighted average price (in dollars per share) | $30.36 | ' | $30.36 | ' |
Total fair value of restricted stock awards vested | 0 | 0 | 12,600,000 | 4,300,000 |
Total unrecognized stock compensation expense | $28,800,000 | ' | $28,800,000 | ' |
Weighted average period to recognize unrecognized compensation cost | ' | ' | '2 years 3 months 18 days | ' |
INVESTMENT_SECURITIES_Details
INVESTMENT SECURITIES (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | $2,534,163 | $2,786,490 | ||
Gross Unrealized Gains | 22,141 | 12,203 | ||
Gross Unrealized Losses | -26,652 | -64,896 | ||
Fair Value | 2,529,652 | 2,733,797 | ||
U.S. Treasury securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 450,149 | 495,053 | ||
Gross Unrealized Gains | 791 | 201 | ||
Gross Unrealized Losses | -1,628 | -3,622 | ||
Fair Value | 449,312 | 491,632 | ||
U.S. government agency and U.S. government sponsored enterprise debt securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 441,747 | 406,807 | ||
Gross Unrealized Gains | 938 | 242 | ||
Gross Unrealized Losses | -4,086 | -12,726 | ||
Fair Value | 438,599 | 394,323 | ||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Commercial mortgage-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 112,607 | 182,257 | ||
Gross Unrealized Gains | 513 | 1,062 | ||
Gross Unrealized Losses | -1,363 | -4,449 | ||
Fair Value | 111,757 | 178,870 | ||
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Residential mortgage-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 798,915 | 892,435 | ||
Gross Unrealized Gains | 8,108 | 7,729 | ||
Gross Unrealized Losses | -9,057 | -14,927 | ||
Fair Value | 797,966 | 885,237 | ||
Municipal securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 289,200 | 297,390 | ||
Gross Unrealized Gains | 4,926 | 1,122 | ||
Gross Unrealized Losses | -4,647 | -17,533 | ||
Fair Value | 289,479 | 280,979 | ||
Other residential mortgage-backed securities: | Investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 57,065 | 48,129 | ||
Gross Unrealized Gains | 557 | ' | ||
Gross Unrealized Losses | -416 | -1,802 | ||
Fair Value | 57,206 | 46,327 | ||
Other commercial mortgage-backed securities: | Investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 51,000 | 51,000 | ||
Gross Unrealized Gains | 463 | 617 | ||
Fair Value | 51,463 | 51,617 | ||
Corporate debt securities | Investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 211,144 | 312,726 | ||
Gross Unrealized Gains | 1,172 | 613 | ||
Gross Unrealized Losses | -1,446 | -3,344 | ||
Fair Value | 210,870 | 309,995 | ||
Corporate debt securities | Non-investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 19,953 | [1] | 20,668 | [1] |
Gross Unrealized Gains | 131 | [1] | 62 | [1] |
Gross Unrealized Losses | -3,505 | [1] | -5,629 | [1] |
Fair Value | 16,579 | [1] | 15,101 | [1] |
Other securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Investment securities available-for-sale, amortized cost | 102,383 | 80,025 | ||
Gross Unrealized Gains | 4,542 | 555 | ||
Gross Unrealized Losses | -504 | -864 | ||
Fair Value | $106,421 | $79,716 | ||
[1] | For the six months ended June 30, 2014 and the year ended December 31, 2013, the Company did not record any OTTI. |
INVESTMENT_SECURITIES_Details_
INVESTMENT SECURITIES (Details 2) (Investment securities available for sale, USD $) | 3 Months Ended | 6 Months Ended | |||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
Investment securities available for sale | ' | ' | ' | ' | ' |
Other than Temporary Impairment, Credit Losses Recognized in Earnings | ' | ' | ' | ' | ' |
OTTI credit losses | $0 | $0 | ' | ' | ' |
Beginning balance | 115,511 | 115,511 | 115,511 | 115,511 | 115,511 |
Ending balance | $115,511 | $115,511 | $115,511 | $115,511 | $115,511 |
INVESTMENT_SECURITIES_Details_1
INVESTMENT SECURITIES (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Schedule of Available-for-sale Securities | ' | ' | ' | ' |
Gross gains on sale of investment securities | $671,000 | $5,300,000 | $4,200,000 | $10,900,000 |
Gross losses on sale of investment securities | ' | ' | 127,000 | 0 |
Tax expense on sale of investment securities | 282,000 | 2,200,000 | 1,700,000 | 4,600,000 |
Net proceeds for sales of investment securities | 21,600,000 | 128,900,000 | 351,800,000 | 325,700,000 |
MetroCorp | ' | ' | ' | ' |
Schedule of Available-for-sale Securities | ' | ' | ' | ' |
Gross losses on sale of investment securities | ' | ' | $127,000 | ' |
INVESTMENT_SECURITIES_Details_2
INVESTMENT SECURITIES (Details 4) (USD $) | 6 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | $333,289 | $1,803,074 |
Continuous unrealized loss position less than 12 months, unrealized losses | -3,939 | -45,167 |
Continuous unrealized loss position 12 months or more, fair value | 966,358 | 250,361 |
Continuous unrealized loss position 12 months or more, unrealized losses | -22,713 | -19,729 |
Continuous unrealized loss position total, fair value | 1,299,647 | 2,053,435 |
Continuous unrealized loss position total, unrealized losses | -26,652 | -64,896 |
U.S. Treasury securities | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 30,630 | 337,248 |
Continuous unrealized loss position less than 12 months, unrealized losses | -40 | -3,622 |
Continuous unrealized loss position 12 months or more, fair value | 184,740 | ' |
Continuous unrealized loss position 12 months or more, unrealized losses | -1,588 | ' |
Continuous unrealized loss position total, fair value | 215,370 | 337,248 |
Continuous unrealized loss position total, unrealized losses | -1,628 | -3,622 |
U.S. government agency and U.S. government sponsored enterprise debt securities | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 33,829 | 387,097 |
Continuous unrealized loss position less than 12 months, unrealized losses | -882 | -12,726 |
Continuous unrealized loss position 12 months or more, fair value | 171,913 | ' |
Continuous unrealized loss position 12 months or more, unrealized losses | -3,204 | ' |
Continuous unrealized loss position total, fair value | 205,742 | 387,097 |
Continuous unrealized loss position total, unrealized losses | -4,086 | -12,726 |
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Commercial mortgage-backed securities | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 23,683 | 114,754 |
Continuous unrealized loss position less than 12 months, unrealized losses | -513 | -3,280 |
Continuous unrealized loss position 12 months or more, fair value | 43,550 | 16,065 |
Continuous unrealized loss position 12 months or more, unrealized losses | -850 | -1,169 |
Continuous unrealized loss position total, fair value | 67,233 | 130,819 |
Continuous unrealized loss position total, unrealized losses | -1,363 | -4,449 |
U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities - Residential mortgage-backed securities | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 205,095 | 502,285 |
Continuous unrealized loss position less than 12 months, unrealized losses | -1,992 | -10,570 |
Continuous unrealized loss position 12 months or more, fair value | 306,292 | 92,540 |
Continuous unrealized loss position 12 months or more, unrealized losses | -7,065 | -4,357 |
Continuous unrealized loss position total, fair value | 511,387 | 594,825 |
Continuous unrealized loss position total, unrealized losses | -9,057 | -14,927 |
Municipal securities | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 3,949 | 173,782 |
Continuous unrealized loss position less than 12 months, unrealized losses | -15 | -10,765 |
Continuous unrealized loss position 12 months or more, fair value | 138,062 | 47,892 |
Continuous unrealized loss position 12 months or more, unrealized losses | -4,632 | -6,768 |
Continuous unrealized loss position total, fair value | 142,011 | 221,674 |
Continuous unrealized loss position total, unrealized losses | -4,647 | -17,533 |
Other residential mortgage-backed securities: | Investment grade | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | ' | 46,328 |
Continuous unrealized loss position less than 12 months, unrealized losses | ' | -1,802 |
Continuous unrealized loss position 12 months or more, fair value | 14,485 | ' |
Continuous unrealized loss position 12 months or more, unrealized losses | -416 | ' |
Continuous unrealized loss position total, fair value | 14,485 | 46,328 |
Continuous unrealized loss position total, unrealized losses | -416 | -1,802 |
Corporate debt securities | Investment grade | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 19,943 | 193,482 |
Continuous unrealized loss position less than 12 months, unrealized losses | -57 | -1,538 |
Continuous unrealized loss position 12 months or more, fair value | 89,752 | 79,442 |
Continuous unrealized loss position 12 months or more, unrealized losses | -1,389 | -1,806 |
Continuous unrealized loss position total, fair value | 109,695 | 272,924 |
Continuous unrealized loss position total, unrealized losses | -1,446 | -3,344 |
Corporate debt securities | Non-investment grade | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position 12 months or more, fair value | 14,660 | 14,422 |
Continuous unrealized loss position 12 months or more, unrealized losses | -3,505 | -5,629 |
Continuous unrealized loss position total, fair value | 14,660 | 14,422 |
Continuous unrealized loss position total, unrealized losses | -3,505 | -5,629 |
Other securities | ' | ' |
Continuous unrealized loss position, fair values of investment securities available-for-sale | ' | ' |
Continuous unrealized loss position less than 12 months, fair value | 16,160 | 48,098 |
Continuous unrealized loss position less than 12 months, unrealized losses | -440 | -864 |
Continuous unrealized loss position 12 months or more, fair value | 2,904 | ' |
Continuous unrealized loss position 12 months or more, unrealized losses | -64 | ' |
Continuous unrealized loss position total, fair value | 19,064 | 48,098 |
Continuous unrealized loss position total, unrealized losses | ($504) | ($864) |
INVESTMENT_SECURITIES_Details_3
INVESTMENT SECURITIES (Details 5) (USD $) | 6 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 | ||
item | item | |||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | $2,529,652 | $2,733,797 | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 168 | 65 | ||
Unrealized losses in loss position for twelve months or more | -22,713 | -19,729 | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 37 | 239 | ||
Unrealized losses in loss position for less than twelve months | -3,939 | -45,167 | ||
Continuous unrealized loss position 12 months or more, fair value | 966,358 | 250,361 | ||
U.S. Government agency and U.S. Government sponsored enterprise mortgage-backed securities - Residential mortgage-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 797,966 | 885,237 | ||
Total investment securities available-for-sale portfolio (as a percent) | 32.00% | 32.00% | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 44 | 21 | ||
Unrealized losses in loss position for twelve months or more | -7,065 | -4,357 | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 22 | 55 | ||
Unrealized losses in loss position for less than twelve months | -1,992 | -10,570 | ||
Continuous unrealized loss position 12 months or more, fair value | 306,292 | 92,540 | ||
Municipal securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 289,479 | 280,979 | ||
Total investment securities available-for-sale portfolio (as a percent) | 11.00% | 10.00% | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 79 | 32 | ||
Unrealized losses in loss position for twelve months or more | -4,632 | -6,768 | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 2 | 94 | ||
Unrealized losses in loss position for less than twelve months | -15 | -10,765 | ||
Continuous unrealized loss position 12 months or more, fair value | 138,062 | 47,892 | ||
Trust Preferred Securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Number of securities in a continuous unrealized loss position for more than twelve months | ' | 5 | ||
Continuous unrealized loss position 12 months or more, fair value | ' | 14,400 | ||
Other securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 106,421 | 79,716 | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 1 | ' | ||
Unrealized losses in loss position for twelve months or more | -64 | ' | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 2 | 9 | ||
Unrealized losses in loss position for less than twelve months | -440 | -864 | ||
Continuous unrealized loss position 12 months or more, fair value | 2,904 | ' | ||
Corporate debt securities | Investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 210,870 | 309,995 | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 6 | 4 | ||
Unrealized losses in loss position for twelve months or more | -1,389 | -1,806 | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 1 | 8 | ||
Unrealized losses in loss position for less than twelve months | -57 | -1,538 | ||
Continuous unrealized loss position 12 months or more, fair value | 89,752 | 79,442 | ||
Corporate debt securities | Non-investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 16,579 | [1] | 15,101 | [1] |
Number of securities in a continuous unrealized loss position for more than twelve months | 4 | ' | ||
Unrealized losses in loss position for twelve months or more | -3,505 | -5,629 | ||
Continuous unrealized loss position 12 months or more, fair value | 14,660 | 14,422 | ||
U.S. Treasury securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 449,312 | 491,632 | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 18 | ' | ||
Unrealized losses in loss position for twelve months or more | -1,588 | ' | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 3 | 33 | ||
Unrealized losses in loss position for less than twelve months | -40 | -3,622 | ||
Continuous unrealized loss position 12 months or more, fair value | 184,740 | ' | ||
U.S. Government agency and U.S. Government sponsored enterprise mortgage-backed securities - Commercial mortgage-backed securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 111,757 | 178,870 | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 9 | 3 | ||
Unrealized losses in loss position for twelve months or more | -850 | -1,169 | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 5 | 19 | ||
Unrealized losses in loss position for less than twelve months | -513 | -3,280 | ||
Continuous unrealized loss position 12 months or more, fair value | 43,550 | 16,065 | ||
U.S. government agency and U.S. government sponsored enterprise debt securities | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 438,599 | 394,323 | ||
Total investment securities available-for-sale portfolio (as a percent) | 17.00% | 14.00% | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 5 | ' | ||
Unrealized losses in loss position for twelve months or more | -3,204 | ' | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | 2 | 16 | ||
Unrealized losses in loss position for less than twelve months | -882 | -12,726 | ||
Continuous unrealized loss position 12 months or more, fair value | 171,913 | ' | ||
Other residential mortgage-backed securities: | Investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | 57,206 | 46,327 | ||
Number of securities in a continuous unrealized loss position for more than twelve months | 2 | ' | ||
Unrealized losses in loss position for twelve months or more | -416 | ' | ||
Number of individual securities with a continuous unrealized loss position less than 12 months | ' | 5 | ||
Unrealized losses in loss position for less than twelve months | ' | -1,802 | ||
Continuous unrealized loss position 12 months or more, fair value | 14,485 | ' | ||
Other commercial mortgage-backed securities: | Investment grade | ' | ' | ||
Schedule of Available-for-sale Securities | ' | ' | ||
Fair value of available for sale securities | $51,463 | $51,617 | ||
[1] | For the six months ended June 30, 2014 and the year ended December 31, 2013, the Company did not record any OTTI. |
INVESTMENT_SECURITIES_Details_4
INVESTMENT SECURITIES (Details 6) (USD $) | Jun. 30, 2014 |
In Thousands, unless otherwise specified | |
Scheduled maturities of investment securities available-for sale, amortized cost basis | ' |
Due within one year | $457,710 |
Due after one year through five years | 557,768 |
Due after five years through ten years | 549,307 |
Due after ten years | 969,378 |
Total investment securities available-for-sale | 2,534,163 |
Scheduled maturities of investment securities available-for sale, estimated fair value | ' |
Due within one year | 451,738 |
Due after one year through five years | 558,346 |
Due after five years through ten years | 553,528 |
Due after ten years | 966,040 |
Total investment securities available-for-sale | $2,529,652 |
DERIVATIVE_FINANCIAL_INSTRUMEN2
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Designated as Hedging Instrument | ' | ' | ||
Fair Values of Derivative Instruments | ' | ' | ||
Notional amount | $135,000 | $135,000 | ||
Derivative liabilities | 11,157 | [1] | 16,906 | [1] |
Designated as Hedging Instrument | Interest rate swaps | ' | ' | ||
Fair Values of Derivative Instruments | ' | ' | ||
Notional amount | 135,000 | 135,000 | ||
Derivative liabilities | 11,157 | [1] | 16,906 | [1] |
Not Designated as Hedging Instrument | ' | ' | ||
Fair Values of Derivative Instruments | ' | ' | ||
Notional amount | 2,672,236 | 2,441,936 | ||
Derivative assets | 40,781 | [1] | 40,549 | [1] |
Derivative liabilities | 37,231 | [1] | 33,356 | [1] |
Not Designated as Hedging Instrument | Foreign exchange options | ' | ' | ||
Fair Values of Derivative Instruments | ' | ' | ||
Notional amount | 85,614 | 85,614 | ||
Derivative assets | 6,049 | [1] | 6,290 | [1] |
Derivative liabilities | 3,362 | [1] | 3,655 | [1] |
Not Designated as Hedging Instrument | Interest rate swaps and caps | ' | ' | ||
Fair Values of Derivative Instruments | ' | ' | ||
Notional amount | 2,109,922 | 1,915,474 | ||
Derivative assets | 30,233 | [1] | 28,078 | [1] |
Derivative liabilities | 29,573 | [1] | 26,352 | [1] |
Not Designated as Hedging Instrument | Foreign exchange contracts | ' | ' | ||
Fair Values of Derivative Instruments | ' | ' | ||
Notional amount | 476,700 | 440,848 | ||
Derivative assets | 4,499 | [1] | 6,181 | [1] |
Derivative liabilities | $4,296 | [1] | $3,349 | [1] |
[1] | Derivative assets, which are a component of other assets, include the estimated settlement of the derivative asset position. Derivative liabilities, which are a component of other liabilities and deposits, include the estimated settlement of the derivative liability position. |
DERIVATIVE_FINANCIAL_INSTRUMEN3
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | |
Counterparties assets | Counterparties assets | Counterparties liabilities | Counterparties liabilities | Foreign exchange options | Interest rate swaps and caps | Interest rate swaps and caps | Short-term foreign exchange contracts | Short-term foreign exchange contracts | Short-term foreign exchange contracts | Short-term foreign exchange contracts | Long-term foreign exchange contracts | Long-term foreign exchange contracts | |||
Counterparties assets | Counterparties liabilities | ||||||||||||||
Derivative | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | $462,800,000 | $426,000,000 | ' | ' | $13,900,000 | $14,800,000 |
Net increase recognized in expense related to hedge ineffectiveness | 538,000 | 339,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net increase to interest expense related to net settlements of derivatives | 2,000,000 | 4,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of contract | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount of derivative assets | ' | ' | ' | ' | ' | ' | ' | 2,110,000,000 | 1,920,000,000 | ' | ' | ' | ' | ' | ' |
Notional amount of derivative liabilities | ' | ' | ' | ' | ' | ' | ' | 2,110,000,000 | 1,920,000,000 | ' | ' | ' | ' | ' | ' |
Fair value of derivative asset | ' | ' | 9,711,000 | 16,043,000 | ' | ' | ' | ' | ' | 4,300,000 | 6,000,000 | 1,500,000 | ' | 188,000 | 200,000 |
Fair value of derivative liability | ' | ' | ' | ' | $40,459,000 | $33,849,000 | ' | ' | ' | $4,100,000 | $3,200,000 | ' | $923,000 | $203,000 | $183,000 |
DERIVATIVE_FINANCIAL_INSTRUMEN4
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Designated as Hedging Instrument | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | $3,045 | ($3,810) | $5,750 | ($4,715) |
Designated as Hedging Instrument | Interest rate swaps | Interest Expense | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | 3,045 | -3,810 | 5,750 | -4,715 |
Not Designated as Hedging Instrument | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | -460 | 1,241 | -3,643 | 1,562 |
Not Designated as Hedging Instrument | Foreign exchange options | Noninterest Income | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | 173 | 97 | 54 | 238 |
Not Designated as Hedging Instrument | Foreign exchange options | Noninterest Expense | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | -3 | -1 | -2 | 6 |
Not Designated as Hedging Instrument | Interest rate swaps and caps | Noninterest Income | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | -130 | 1,864 | -1,066 | 2,080 |
Not Designated as Hedging Instrument | Foreign exchange contracts | Noninterest Income | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) | ' | ' | ' | ' |
Net (losses) gains on derivative instruments | ($500) | ($719) | ($2,629) | ($762) |
DERIVATIVE_FINANCIAL_INSTRUMEN5
DERIVATIVE FINANCIAL INSTRUMENTS AND BALANCE SHEET OFFSETTING (Details 4) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Liabilities, Repurchase Agreements | ' | ' |
Gross Amounts of Recognized Liabilities | $1,005,211,000 | $995,000,000 |
Gross Amounts Not Offset in the Consolidated Balance Sheets | ' | ' |
Cash collateral received | 3,600,000 | 0 |
Cash collateral posted | 7,500,000 | 187,000 |
Counterparties assets | ' | ' |
Assets, Derivatives | ' | ' |
Gross Amounts of Recognized Assets | 9,711,000 | 16,043,000 |
Net Amounts of Assets Presented | 9,711,000 | 16,043,000 |
Gross Amounts Not Offset | ' | ' |
Financial Instruments | -5,122,000 | -11,363,000 |
Collateral Received | -4,589,000 | -4,680,000 |
Assets, Resale Agreements | ' | ' |
Gross Amounts of Recognized Assets | 1,275,000,000 | 1,400,000,000 |
Net Amounts of Assets Presented | 1,275,000,000 | 1,400,000,000 |
Gross Amounts Not Offset | ' | ' |
Financial Instruments | -475,000,000 | -495,000,000 |
Collateral Received | -800,000,000 | -905,000,000 |
Counterparties liabilities | ' | ' |
Liabilities, Derivatives | ' | ' |
Gross Amounts of Recognized Liabilities | 40,459,000 | 33,849,000 |
Net Amounts of Liabilities Presented | 40,459,000 | 33,849,000 |
Gross Amounts Not Offset | ' | ' |
Financial Instruments | -5,122,000 | -11,363,000 |
Collateral Posted | -35,337,000 | -22,486,000 |
Liabilities, Repurchase Agreements | ' | ' |
Gross Amounts of Recognized Liabilities | 1,005,211,000 | 995,000,000 |
Net Amounts of Liabilities Presented | 1,005,211,000 | 995,000,000 |
Gross Amounts Not Offset in the Consolidated Balance Sheets | ' | ' |
Financial Instruments | -475,000,000 | -495,000,000 |
Collateral Posted | ($530,211,000) | ($500,000,000) |
COVERED_ASSETS_AND_FDIC_INDEMN2
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Details) (USD $) | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 |
Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | |||
Commercial | Residential Single-family | United Commercial Bank | United Commercial Bank | United Commercial Bank | Washington First International Bank | Washington First International Bank | |||||
Minimum | Maximum | Minimum | |||||||||
Schedule Of Covered Assets - disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of loans receivable acquired covered by shared-loss agreements | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 99.00% |
Percentage of eligible losses for which the FDIC is obligated to reimburse the Company | 80.00% | 80.00% | ' | ' | ' | ' | 80.00% | ' | ' | 80.00% | ' |
Percentage of eligible losses in excess of a specified amount for which the FDIC is obligated to reimburse the Company | ' | ' | ' | ' | ' | ' | 95.00% | ' | ' | ' | ' |
Amount of eligible losses over which the FDIC is obligated to reimburse a higher percentage | ' | ' | ' | ' | ' | ' | $2,050,000,000 | ' | ' | ' | ' |
Percentage obligation to reimburse the FDIC for eligible recoveries related to covered assets | ' | ' | ' | ' | ' | ' | ' | 80.00% | 95.00% | ' | ' |
Term of loan shared-loss agreement | ' | ' | ' | ' | '5 years | '10 years | ' | ' | ' | ' | ' |
Term of loss recovery provisions for loans | ' | ' | ' | ' | '8 years | '10 years | ' | ' | ' | ' | ' |
Number of days following the 10th anniversary of the acquisition date upon which the Company will be required to pay a calculated amount to the FDIC | ' | ' | '45 days | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of excess resulting from the calculation of liability to the FDIC | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of the Intrinsic Loss Estimate used in the calculation of the liability to the FDIC | ' | ' | 20.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of the asset discount used in the calculation of the liability to the FDIC | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of the Cumulative Shared-Loss Payments used in the calculation of the liability to the FDIC | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated liability that will be due to the FDIC based on specific thresholds of losses not being reached | ' | ' | $90,000,000 | $74,700,000 | ' | ' | ' | ' | ' | ' | ' |
COVERED_ASSETS_AND_FDIC_INDEMN3
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Details 2) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Allowance on covered loans | ($4,880) | ($7,745) | ||
Total covered loans, net | 1,803,090 | 2,187,898 | ||
Covered loans | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 1,807,970 | [1] | 2,195,643 | [2] |
Covered discount | -181,357 | -265,917 | ||
Net valuation of loans | 1,807,970 | 2,195,643 | ||
Allowance on covered loans | -4,880 | -7,745 | ||
Total covered loans, net | 1,803,090 | 2,187,898 | ||
Collectively evaluated for impairment | 252,205 | [1] | 320,185 | [2] |
Acquired with deteriorated credit quality | 1,555,765 | 1,875,458 | ||
Covered loans | Residential | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 620,910 | 693,603 | ||
Collectively evaluated for impairment | 11,700 | 12,000 | ||
Covered loans | Residential | Residential Single-family | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 259,438 | 290,095 | ||
Covered loans | Residential | Residential Multifamily | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 361,472 | 403,508 | ||
Covered loans | Commercial Real Estate ("CRE") | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 968,356 | 1,267,363 | ||
Collectively evaluated for impairment | 9,000 | 46,700 | ||
Covered loans | Commercial Real Estate ("CRE") | Commercial and Industrial Real Estate | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 895,140 | 1,103,530 | ||
Covered loans | Commercial Real Estate ("CRE") | Construction and Land | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 73,216 | 163,833 | ||
Covered loans | Commercial and Industrial ("C&I") | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Collectively evaluated for impairment | 202,500 | 230,600 | ||
Covered loans | Consumer | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Collectively evaluated for impairment | 29,000 | 30,900 | ||
Covered loans | Other Loans | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 400,061 | 500,594 | ||
Covered loans | Other Loans | Commercial Business | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | 331,117 | 426,621 | ||
Covered loans | Other Loans | Other Consumer | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total covered loans receivable | $68,944 | $73,973 | ||
[1] | Includes $252.2 million of covered advances comprising of $202.5 million, $29.0 million, $11.7 million and $9.0 million of commercial and industrial, consumer, residential and commercial real estate loans, respectively. | |||
[2] | Includes $320.2 million of covered advances comprising of $230.6 million, $46.7 million, $30.9 million and $12.0 million of commercial and industrial, commercial real estate, consumer and residential loans, respectively. |
COVERED_ASSETS_AND_FDIC_INDEMN4
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Provision for (reversal of) loan losses | ($8,000) | ($9,000) | ($14,933) | ($13,327) | ' | |||||
Covered loans | ' | ' | ' | ' | ' | |||||
Allowance for loan losses disclosures | ' | ' | ' | ' | ' | |||||
Principal balance | 1,807,970 | [1] | ' | 1,807,970 | [1] | ' | 2,195,643 | [2] | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Beginning balance | 6,518 | 10,110 | 7,745 | 5,153 | ' | |||||
Provision for (reversal of) loan losses | -944 | 723 | -1,965 | 5,812 | ' | |||||
Charge-offs | -694 | -1,204 | -900 | -1,336 | ' | |||||
Ending balance | 4,880 | 9,629 | 4,880 | 9,629 | ' | |||||
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Collectively evaluated for impairment | 3,692 | [3] | 7,100 | [4] | 3,692 | [3] | 7,100 | [4] | ' | |
Acquired with deteriorated credit quality | 1,188 | 2,529 | 1,188 | 2,529 | ' | |||||
Ending balance | 4,880 | 9,629 | 4,880 | 9,629 | ' | |||||
Covered loans | Commercial and Industrial ("C&I") | ' | ' | ' | ' | ' | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Ending balance | 2,600 | 4,100 | 2,600 | 4,100 | ' | |||||
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Ending balance | 2,600 | 4,100 | 2,600 | 4,100 | ' | |||||
Covered loans | Commercial Real Estate ("CRE") | ' | ' | ' | ' | ' | |||||
Allowance for loan losses disclosures | ' | ' | ' | ' | ' | |||||
Principal balance | 968,356 | ' | 968,356 | ' | 1,267,363 | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Ending balance | 666 | 2,400 | 666 | 2,400 | ' | |||||
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Ending balance | 666 | 2,400 | 666 | 2,400 | ' | |||||
Covered loans | Consumer | ' | ' | ' | ' | ' | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Ending balance | 282 | 407 | 282 | 407 | ' | |||||
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Ending balance | 282 | 407 | 282 | 407 | ' | |||||
Covered loans | Residential | ' | ' | ' | ' | ' | |||||
Allowance for loan losses disclosures | ' | ' | ' | ' | ' | |||||
Principal balance | 620,910 | ' | 620,910 | ' | 693,603 | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Ending balance | 167 | 174 | 167 | 174 | ' | |||||
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Ending balance | 167 | 174 | 167 | 174 | ' | |||||
Covered loans | Covered Advances | ' | ' | ' | ' | ' | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Beginning balance | 4,316 | 8,118 | 5,476 | 5,153 | ' | |||||
Provision for (reversal of) loan losses | 70 | 186 | -884 | 3,283 | ' | |||||
Charge-offs | -694 | -1,204 | -900 | -1,336 | ' | |||||
Ending balance | 3,692 | [3] | 7,100 | [4] | 3,692 | [3] | 7,100 | [4] | ' | |
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Collectively evaluated for impairment | 3,692 | [3] | 7,100 | [4] | 3,692 | [3] | 7,100 | [4] | ' | |
Ending balance | 3,692 | [3] | 7,100 | [4] | 3,692 | [3] | 7,100 | [4] | ' | |
Covered loans | PCI Covered Loans | ' | ' | ' | ' | ' | |||||
Allowance for loan losses disclosures | ' | ' | ' | ' | ' | |||||
Principal balance | 66,300 | ' | 66,300 | ' | 129,700 | |||||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ' | |||||
Beginning balance | 2,202 | 1,992 | 2,269 | ' | ' | |||||
Provision for (reversal of) loan losses | -1,014 | 537 | -1,081 | 2,529 | ' | |||||
Ending balance | 1,188 | 2,529 | 1,188 | 2,529 | ' | |||||
Ending balance allocated to: | ' | ' | ' | ' | ' | |||||
Acquired with deteriorated credit quality | 1,188 | 2,529 | 1,188 | 2,529 | ' | |||||
Ending balance | $1,188 | $2,529 | $1,188 | $2,529 | ' | |||||
[1] | Includes $252.2 million of covered advances comprising of $202.5 million, $29.0 million, $11.7 million and $9.0 million of commercial and industrial, consumer, residential and commercial real estate loans, respectively. | |||||||||
[2] | Includes $320.2 million of covered advances comprising of $230.6 million, $46.7 million, $30.9 million and $12.0 million of commercial and industrial, commercial real estate, consumer and residential loans, respectively. | |||||||||
[3] | $2.6 million, $666 thousand, $282 thousand and $167 thousand of allowance for loan losses are allocated on commercial and industrial, commercial real estate, consumer and residential loans, respectively. | |||||||||
[4] | $4.1 million, $2.4 million, $407 thousand and $174 thousand of allowance for loan losses are allocated on commercial and industrial, commercial real estate, consumer and residential loans, respectively. |
COVERED_ASSETS_AND_FDIC_INDEMN5
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Details 4) (Covered loans, USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | $1,807,970 | [1] | $2,195,643 | [2] |
Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 1,710,321 | 2,003,632 | ||
Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 21,304 | 43,604 | ||
Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 250,342 | 406,855 | ||
Doubtful | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 7,360 | 7,469 | ||
Residential | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 620,910 | 693,603 | ||
Residential | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 580,111 | 654,270 | ||
Residential | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 1,543 | 1,518 | ||
Residential | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 39,256 | 37,815 | ||
Residential | Residential Single-family | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 259,438 | 290,095 | ||
Residential | Residential Single-family | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 252,121 | 281,246 | ||
Residential | Residential Single-family | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 757 | 733 | ||
Residential | Residential Single-family | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 6,560 | 8,116 | ||
Residential | Residential Multifamily | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 361,472 | 403,508 | ||
Residential | Residential Multifamily | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 327,990 | 373,024 | ||
Residential | Residential Multifamily | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 786 | 785 | ||
Residential | Residential Multifamily | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 32,696 | 29,699 | ||
Commercial Real Estate ("CRE") | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 968,356 | 1,267,363 | ||
Commercial Real Estate ("CRE") | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 780,872 | 899,223 | ||
Commercial Real Estate ("CRE") | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 12,490 | 37,323 | ||
Commercial Real Estate ("CRE") | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 167,634 | 323,451 | ||
Commercial Real Estate ("CRE") | Doubtful | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 7,360 | 7,366 | ||
Commercial Real Estate ("CRE") | Commercial and Industrial Real Estate | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 895,140 | 1,103,530 | ||
Commercial Real Estate ("CRE") | Commercial and Industrial Real Estate | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 755,244 | 857,376 | ||
Commercial Real Estate ("CRE") | Commercial and Industrial Real Estate | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 3,255 | 27,851 | ||
Commercial Real Estate ("CRE") | Commercial and Industrial Real Estate | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 130,173 | 211,835 | ||
Commercial Real Estate ("CRE") | Commercial and Industrial Real Estate | Doubtful | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 6,468 | 6,468 | ||
Commercial Real Estate ("CRE") | Construction and Land | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 73,216 | 163,833 | ||
Commercial Real Estate ("CRE") | Construction and Land | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 25,628 | 41,847 | ||
Commercial Real Estate ("CRE") | Construction and Land | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 9,235 | 9,472 | ||
Commercial Real Estate ("CRE") | Construction and Land | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 37,461 | 111,616 | ||
Commercial Real Estate ("CRE") | Construction and Land | Doubtful | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 892 | 898 | ||
Other Loans | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 400,061 | 500,594 | ||
Other Loans | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 349,338 | 450,139 | ||
Other Loans | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 7,271 | 4,763 | ||
Other Loans | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 43,452 | 45,589 | ||
Other Loans | Doubtful | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | ' | 103 | ||
Other Loans | Commercial Business | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 331,117 | 426,621 | ||
Other Loans | Commercial Business | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 282,018 | 378,086 | ||
Other Loans | Commercial Business | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 7,171 | 4,635 | ||
Other Loans | Commercial Business | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 41,928 | 43,797 | ||
Other Loans | Commercial Business | Doubtful | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | ' | 103 | ||
Other Loans | Other Consumer | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 68,944 | 73,973 | ||
Other Loans | Other Consumer | Pass/Watch | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 67,320 | 72,053 | ||
Other Loans | Other Consumer | Special Mention | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | 100 | 128 | ||
Other Loans | Other Consumer | Substandard | ' | ' | ||
Carrying Amounts And Composition Of Covered Loans | ' | ' | ||
Total principal balance | $1,524 | $1,792 | ||
[1] | Includes $252.2 million of covered advances comprising of $202.5 million, $29.0 million, $11.7 million and $9.0 million of commercial and industrial, consumer, residential and commercial real estate loans, respectively. | |||
[2] | Includes $320.2 million of covered advances comprising of $230.6 million, $46.7 million, $30.9 million and $12.0 million of commercial and industrial, commercial real estate, consumer and residential loans, respectively. |
COVERED_ASSETS_AND_FDIC_INDEMN6
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Details 5) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Nov. 06, 2009 | Nov. 06, 2009 | Nov. 06, 2009 | |||
Covered loans accounted for under ASC 310-10 | Covered loans accounted for under ASC 310-10 | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | Covered loans | ||||||
Covered Advances | Covered Advances | PCI Covered Loans | PCI Covered Loans | Covered OREO Properties | Covered OREO Properties | Covered OREO Properties | Covered OREO Properties | Covered OREO Properties | Covered OREO Properties | Covered OREO Properties | United Commercial Bank (UCB) | United Commercial Bank (UCB) | United Commercial Bank (UCB) | United Commercial Bank (UCB) | United Commercial Bank (UCB) | |||||||||||||
item | Geographic Concentration | Geographic Concentration | Geographic Concentration | Geographic Concentration | Geographic Concentration | item | Covered loans acquired from specific acquiree | Covered loans acquired from specific acquiree | Covered loans acquired from specific acquiree | |||||||||||||||||||
California | California | Massachusetts | Massachusetts | Washington | Geographic Concentration | Geographic Concentration | Geographic Concentration | |||||||||||||||||||||
California | New York | Hong Kong | ||||||||||||||||||||||||||
Credit Risk and Concentrations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Percentage of the entity's total covered loans acquired from a specific counterparty | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 94.00% | 94.00% | ' | ' | ' | |||
Percent of total | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24.00% | 31.00% | 26.00% | 31.00% | 22.00% | ' | ' | 64.00% | 11.00% | 10.00% | |||
Number of general geographic regions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | |||
Covered Nonperforming Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Covered nonaccrual loans | ' | ' | $14,300,000 | $17,700,000 | $86,771,000 | [1],[2],[3] | ' | $86,771,000 | [1],[2],[3] | ' | $126,895,000 | [1],[2],[3] | $14,300,000 | $17,700,000 | $72,500,000 | $109,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other real estate owned covered, net | 24,779,000 | 21,373,000 | ' | ' | 24,779,000 | ' | 24,779,000 | ' | 21,373,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Total covered nonperforming assets | ' | ' | ' | ' | 111,550,000 | ' | 111,550,000 | ' | 148,268,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Percentage of any reimbursable expense recorded as interest income under ASC 310-30 | ' | ' | ' | ' | 80.00% | ' | 80.00% | ' | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Covered loans past due 90 days or more but not on nonaccrual | ' | ' | ' | ' | 0 | ' | 0 | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Covered nonaccrual loans | ' | ' | 14,300,000 | 17,700,000 | 86,771,000 | [1],[2],[3] | ' | 86,771,000 | [1],[2],[3] | ' | 126,895,000 | [1],[2],[3] | 14,300,000 | 17,700,000 | 72,500,000 | 109,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Covered OREO balances | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24,800,000 | 21,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Number of covered OREO properties added during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Aggregate carrying value of covered OREO properties added during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 19,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Net valuation adjustments included in aggregate carrying value on covered OREO properties | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 465,000 | 2,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Number of covered OREO properties sold during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Total proceeds value of covered OREO properties sold during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Total net gains (losses) on covered OREO properties sold during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Covered TDR activity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Balance at beginning of period | ' | ' | ' | ' | 73,234,000 | 141,923,000 | 116,007,000 | 157,736,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Additions | ' | ' | ' | ' | 704,000 | 3,709,000 | 787,000 | 25,793,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Transfers to covered OREO | ' | ' | ' | ' | -1,230,000 | ' | -1,230,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Charge-offs | ' | ' | ' | ' | -500,000 | -3,762,000 | -1,323,000 | -7,466,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Paydowns/ Reductions | ' | ' | ' | ' | -13,414,000 | -21,622,000 | -54,217,000 | -55,815,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Balance at end of period | ' | ' | ' | ' | 60,024,000 | 120,248,000 | 60,024,000 | 120,248,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Changes in the accretable yield for the covered loans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Balance at beginning of period | ' | ' | ' | ' | 424,005,000 | 503,476,000 | 461,545,000 | 556,986,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Accretion | ' | ' | ' | ' | -64,114,000 | -84,811,000 | -125,304,000 | -166,438,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Changes in expected cash flows | ' | ' | ' | ' | 27,236,000 | 40,052,000 | 50,886,000 | 68,169,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Balance at end of period | ' | ' | ' | ' | 387,127,000 | 458,717,000 | 387,127,000 | 458,717,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Covered assets - other disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Amount reclassified from nonaccretable yield to accretable yield due to changes in loss rate assumptions | ' | ' | ' | ' | 19,600,000 | 26,000,000 | 38,600,000 | 39,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Amount of loans removed from the covered loans accounted for under ASC 310-30, excluding scheduled principal payments | ' | ' | ' | ' | ' | ' | 353,700,000 | 392,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Loan discount related to payoffs and removals of loans | ' | ' | ' | ' | ' | ' | $51,100,000 | $74,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
[1] | Covered nonaccrual loans include loans that meet the criteria for nonaccrual but have a yield accreted through interest income under ASC 310-30. All losses on covered loans are 80% reimbursed by the FDIC. | |||||||||||||||||||||||||||
[2] | Net of discount. | |||||||||||||||||||||||||||
[3] | Includes $14.3 million and $17.7 million of covered advances as of June 30, 2014 and December 31, 2013, respectively; and $72.5 million and $109.2 million of PCI loans as of June 30, 2014 and December 31, 2013, respectively. |
COVERED_ASSETS_AND_FDIC_INDEMN7
COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Details 6) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
FDIC indemnification asset/(Net payable to FDIC) | ' | ' | ' | ' |
Balance at beginning of period | $27,552 | $276,834 | $74,708 | $316,313 |
Amortization | -29,303 | -12,696 | -57,793 | -21,382 |
Reductions | -14,111 | -28,820 | -25,953 | -52,055 |
Estimate of FDIC repayment | -8,475 | -15,376 | -15,299 | -22,934 |
Balance at end of period | -24,337 | 219,942 | -24,337 | 219,942 |
FDIC Receivable | ' | ' | ' | ' |
Percentage of reimbursable expenses that are loan-related and OREO expenses that are recorded as non-interest expense | 100.00% | ' | 100.00% | ' |
Percentage of actual expense paid by the Company | 20.00% | ' | 20.00% | ' |
Percentage of Recoveries received | 80.00% | ' | 80.00% | ' |
Percentage of any reimbursable expense recorded as noninterest income | 80.00% | ' | 80.00% | ' |
FDIC receivable activity | ' | ' | ' | ' |
Balance at beginning of period | 19,644 | 46,762 | 30,261 | 73,091 |
Net (reduction) addition due to recovery or eligible expense/loss | -5,669 | 8,967 | -12,147 | 16,528 |
Payments to (received from) the FDIC | 1,772 | -8,604 | -2,367 | -42,494 |
Balance at end of period | $15,747 | $47,125 | $15,747 | $47,125 |
NONCOVERED_LOANS_AND_ALLOWANCE2
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Non-Covered loans receivable disclosures | ' | ' | ||
Allowance for non-covered loans receivable | ($246,468) | ($241,930) | ||
Non-covered loans receivable, excluding covered loans, net | 18,025,711 | 15,412,715 | ||
Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 18,277,768 | [1] | 15,678,317 | [1] |
Unearned fees, premiums and discounts, net | -5,589 | -23,672 | ||
Allowance for non-covered loans receivable | -246,468 | -241,930 | ||
Non-covered loans receivable, excluding covered loans, net | 18,025,711 | 15,412,715 | ||
Residential | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 4,449,727 | 4,185,309 | ||
Residential | Single-family | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 3,316,581 | 3,192,875 | ||
Residential | Multifamily | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,133,146 | 992,434 | ||
Commercial Real Estate ("CRE") | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,798,303 | 4,585,077 | ||
Commercial Real Estate ("CRE") | Income producing | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,358,710 | 4,301,030 | ||
Commercial Real Estate ("CRE") | Construction | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 233,105 | 140,186 | ||
Commercial Real Estate ("CRE") | Land | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 206,488 | 143,861 | ||
Commercial and Industrial ("C&I") | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 6,673,303 | 5,360,193 | ||
Commercial and Industrial ("C&I") | Commercial Business | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,956,607 | 4,637,056 | ||
Commercial and Industrial ("C&I") | Trade finance | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 716,696 | 723,137 | ||
Consumer | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,356,435 | 1,547,738 | ||
Consumer | Student loans | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | 139,736 | 679,220 | ||
Consumer | Other Consumer | Non-covered loans | ' | ' | ||
Non-Covered loans receivable disclosures | ' | ' | ||
Loans receivable, excluding covered loans, gross | $1,216,699 | $868,518 | ||
[1] | Loans net of ASC 310-30 discount. |
NONCOVERED_LOANS_AND_ALLOWANCE3
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 2) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 |
Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | Residential | |||
Minimum | Maximum | Single-family | Single-family | Single-family | Single-family | Single-family | Single-family | Multifamily | Multifamily | Multifamily | Multifamily | Multifamily | Home Equity | Home Equity | Home Equity | Home Equity | Home Equity | Home Equity | |||
Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Minimum | Maximum | Non-covered loans | Non-covered loans | Minimum | Midrange | Maximum | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Minimum | Maximum | |||
item | item | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | |||||||||||||
item | item | ||||||||||||||||||||
Non-Covered loans receivable disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued interest on covered and non-covered loans receivable | $79,500,000 | $94,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Covered and non-covered loans receivable pledged to secure borrowings from the FHLB and the Federal Reserve Bank | 12,980,000,000 | 10,570,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of units of residential property securing fixed and adjustable rate first mortgage loans | ' | ' | 1 | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | 4 |
New first mortgage loans originated | ' | ' | ' | ' | $229,800,000 | $413,400,000 | $411,400,000 | $676,500,000 | ' | ' | $154,700,000 | $104,200,000 | ' | ' | ' | $244,500,000 | $195,400,000 | $493,400,000 | $284,600,000 | ' | ' |
Adjustable rate mortgage, term of initial fixed interest rates | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | '3 years | ' | ' | '6 months | '3 years | '5 years | ' | ' | ' | ' | ' | ' |
Loans to value ratio (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60.00% |
NONCOVERED_LOANS_AND_ALLOWANCE4
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 3) (USD $) | 6 Months Ended | 3 Months Ended | 6 Months Ended | 0 Months Ended | ||||||||||||||
Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Jan. 17, 2014 | Jun. 30, 2014 | Jan. 17, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | ||||
Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | MetroCorp | MetroCorp | MetroCorp | Residential | Residential | Commercial Real Estate ("CRE") | Commercial Real Estate ("CRE") | |||||||
Non-covered loans | Covered Loans under ASC 310-30 Subject to Allowance for Loan Losses | Non-covered loans | Non-covered loans | Non-covered loans | Non-covered loans | |||||||||||||
Non-covered loans | ||||||||||||||||||
Credit Risk and Concentrations | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Percentage of non-covered commercial real estate loans and non-covered residential loans secured by real properties located in California | ' | ' | ' | 80.00% | ' | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Loans receivable, excluding covered loans, gross | ' | ' | ' | $18,277,768,000 | [1] | ' | $18,277,768,000 | [1] | ' | $15,678,317,000 | [1] | ' | ' | ' | $4,449,727,000 | $4,185,309,000 | $5,798,303,000 | $4,585,077,000 |
Purchased Loans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Loans purchased during the period | ' | ' | ' | ' | ' | 86,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Acquired Loans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Loans acquired during the period | ' | ' | ' | ' | ' | ' | ' | ' | 1,190,000,000 | ' | ' | ' | ' | ' | ' | |||
Acquired loans accounted (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.00% | ' | ' | ' | ' | |||
PCI loans | ' | ' | ' | ' | ' | ' | ' | ' | ' | 58,900,000 | ' | ' | ' | ' | ' | |||
Loans Held for Sale | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
Total loans held for sale | 450,864,000 | ' | 204,970,000 | 450,900,000 | ' | 450,900,000 | ' | 205,000,000 | ' | ' | ' | ' | ' | ' | ' | |||
Proceeds from the sales of Loans held for sale, including loans reclassified to loans held for sale | ' | ' | ' | 190,500,000 | 0 | 326,300,000 | 6,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | |||
Net gain from sale of loans held for sale during the period | ' | ' | ' | 5,000,000 | ' | 8,500,000 | 1,000 | ' | ' | ' | ' | ' | ' | ' | ' | |||
Loans receivable reclassified to loans held for sale | $460,828,000 | $19,125,000 | ' | $27,000,000 | ' | $460,828,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||
[1] | Loans net of ASC 310-30 discount. |
NONCOVERED_LOANS_AND_ALLOWANCE5
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 4) (Non-covered loans, USD $) | Jun. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | item | |||
Credit Quality Indicators | ' | ' | ||
Number of grades in the risk rating system utilized by the company to rate credit risk of loans receivable | 8 | ' | ||
Loans receivable, excluding covered loans, gross | $18,277,768 | [1] | $15,678,317 | [1] |
Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 17,456,101 | 14,991,479 | ||
Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 251,441 | 197,284 | ||
Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 568,794 | 489,554 | ||
Doubtful | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,432 | ' | ||
Residential | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 4,449,727 | 4,185,309 | ||
Residential | Residential Single-family | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 3,316,581 | 3,192,875 | ||
Residential | Residential Single-family | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 3,297,111 | 3,167,337 | ||
Residential | Residential Single-family | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 7,708 | 8,331 | ||
Residential | Residential Single-family | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 11,762 | 17,207 | ||
Residential | Residential Multifamily | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,133,146 | 992,434 | ||
Residential | Residential Multifamily | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,075,296 | 923,697 | ||
Residential | Residential Multifamily | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | ' | 1,634 | ||
Residential | Residential Multifamily | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 57,850 | 67,103 | ||
Commercial Real Estate ("CRE") | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,798,303 | 4,585,077 | ||
Commercial Real Estate ("CRE") | Income producing | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,358,710 | 4,301,030 | ||
Commercial Real Estate ("CRE") | Income producing | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,056,988 | 4,032,269 | ||
Commercial Real Estate ("CRE") | Income producing | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 74,904 | 56,752 | ||
Commercial Real Estate ("CRE") | Income producing | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 225,774 | 212,009 | ||
Commercial Real Estate ("CRE") | Income producing | Doubtful | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,044 | ' | ||
Commercial Real Estate ("CRE") | Construction | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 233,105 | 140,186 | ||
Commercial Real Estate ("CRE") | Construction | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 220,057 | 127,138 | ||
Commercial Real Estate ("CRE") | Construction | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 6,160 | 6,160 | ||
Commercial Real Estate ("CRE") | Construction | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 6,888 | 6,888 | ||
Commercial Real Estate ("CRE") | Land | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 206,488 | 143,861 | ||
Commercial Real Estate ("CRE") | Land | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 178,005 | 116,000 | ||
Commercial Real Estate ("CRE") | Land | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 6,438 | 9,304 | ||
Commercial Real Estate ("CRE") | Land | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 22,045 | 18,557 | ||
Commercial and Industrial ("C&I") | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 6,673,303 | 5,360,193 | ||
Commercial and Industrial ("C&I") | Commercial Business | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,956,607 | 4,637,056 | ||
Commercial and Industrial ("C&I") | Commercial Business | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 5,627,827 | 4,400,847 | ||
Commercial and Industrial ("C&I") | Commercial Business | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 101,399 | 92,315 | ||
Commercial and Industrial ("C&I") | Commercial Business | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 226,993 | 143,894 | ||
Commercial and Industrial ("C&I") | Commercial Business | Doubtful | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 388 | ' | ||
Commercial and Industrial ("C&I") | Trade finance | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 716,696 | 723,137 | ||
Commercial and Industrial ("C&I") | Trade finance | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 650,525 | 681,345 | ||
Commercial and Industrial ("C&I") | Trade finance | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 53,821 | 22,099 | ||
Commercial and Industrial ("C&I") | Trade finance | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 12,350 | 19,693 | ||
Consumer | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,356,435 | 1,547,738 | ||
Consumer | Student loans | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 139,736 | 679,220 | ||
Consumer | Student loans | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 136,553 | 677,094 | ||
Consumer | Student loans | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 643 | 445 | ||
Consumer | Student loans | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 2,540 | 1,681 | ||
Consumer | Other Consumer | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,216,699 | 868,518 | ||
Consumer | Other Consumer | Pass/Watch | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 1,213,739 | 865,752 | ||
Consumer | Other Consumer | Special Mention | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | 368 | 244 | ||
Consumer | Other Consumer | Substandard | ' | ' | ||
Credit Quality Indicators | ' | ' | ||
Loans receivable, excluding covered loans, gross | $2,592 | $2,522 | ||
[1] | Loans net of ASC 310-30 discount. |
NONCOVERED_LOANS_AND_ALLOWANCE6
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 5) (Non-covered loans, USD $) | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Number of days a loan is past due and is placed on nonaccrual status | '90 days | ' | |
Accruing loans 30 - 59 days past due | $38,378 | [1] | $30,282 |
Accruing loans 60 - 89 days past due | 14,634 | [1] | 9,956 |
Total accruing past due loans | 53,012 | [1] | 40,238 |
Nonaccrual loans less than 90 days past due | 57,323 | [1] | 40,462 |
Nonaccrual loans 90 or more days past due | 61,599 | [1] | 71,189 |
Total nonaccrual past due loans | 118,922 | [1] | 111,651 |
Current Accruing loans | 18,556,698 | [1] | 15,731,398 |
Total non-covered loans and loans held for sale, gross | 18,728,632 | [1] | 15,883,287 |
Unearned fees, premiums and discounts, net | -5,589 | -23,672 | |
Recorded investment in non-covered loans and loans held for sale | 18,723,043 | 15,859,615 | |
Loans Held for Sale | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Current Accruing loans | 450,864 | 204,970 | |
Total non-covered loans and loans held for sale, gross | 450,864 | 204,970 | |
Residential | Single-family | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 8,223 | 4,694 | |
Accruing loans 60 - 89 days past due | 743 | 922 | |
Total accruing past due loans | 8,966 | 5,616 | |
Nonaccrual loans less than 90 days past due | 2,844 | ' | |
Nonaccrual loans 90 or more days past due | 5,637 | 11,218 | |
Total nonaccrual past due loans | 8,481 | 11,218 | |
Current Accruing loans | 3,299,134 | 3,176,041 | |
Total non-covered loans and loans held for sale, gross | 3,316,581 | 3,192,875 | |
Residential | Multifamily | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 4,514 | 8,580 | |
Accruing loans 60 - 89 days past due | 932 | 531 | |
Total accruing past due loans | 5,446 | 9,111 | |
Nonaccrual loans less than 90 days past due | 14,385 | 19,661 | |
Nonaccrual loans 90 or more days past due | 11,113 | 7,972 | |
Total nonaccrual past due loans | 25,498 | 27,633 | |
Current Accruing loans | 1,102,202 | 955,690 | |
Total non-covered loans and loans held for sale, gross | 1,133,146 | 992,434 | |
Commercial Real Estate ("CRE") | Income producing | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 18,072 | 12,746 | |
Accruing loans 60 - 89 days past due | 7,619 | 1,798 | |
Total accruing past due loans | 25,691 | 14,544 | |
Nonaccrual loans less than 90 days past due | 31,025 | 13,924 | |
Nonaccrual loans 90 or more days past due | 12,121 | 22,549 | |
Total nonaccrual past due loans | 43,146 | 36,473 | |
Current Accruing loans | 5,289,873 | 4,250,013 | |
Total non-covered loans and loans held for sale, gross | 5,358,710 | 4,301,030 | |
Commercial Real Estate ("CRE") | Construction | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Nonaccrual loans 90 or more days past due | 6,888 | 6,888 | |
Total nonaccrual past due loans | 6,888 | 6,888 | |
Current Accruing loans | 226,217 | 133,298 | |
Total non-covered loans and loans held for sale, gross | 233,105 | 140,186 | |
Commercial Real Estate ("CRE") | Land | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 2,125 | ' | |
Accruing loans 60 - 89 days past due | 96 | ' | |
Total accruing past due loans | 2,221 | ' | |
Nonaccrual loans less than 90 days past due | 1,467 | 265 | |
Nonaccrual loans 90 or more days past due | 5,970 | 3,223 | |
Total nonaccrual past due loans | 7,437 | 3,488 | |
Current Accruing loans | 196,830 | 140,373 | |
Total non-covered loans and loans held for sale, gross | 206,488 | 143,861 | |
Commercial and Industrial ("C&I") | Commercial Business | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 3,047 | 3,428 | |
Accruing loans 60 - 89 days past due | 4,590 | 6,259 | |
Total accruing past due loans | 7,637 | 9,687 | |
Nonaccrual loans less than 90 days past due | 7,600 | 6,437 | |
Nonaccrual loans 90 or more days past due | 16,151 | 15,486 | |
Total nonaccrual past due loans | 23,751 | 21,923 | |
Current Accruing loans | 5,925,219 | 4,605,446 | |
Total non-covered loans and loans held for sale, gross | 5,956,607 | 4,637,056 | |
Commercial and Industrial ("C&I") | Trade finance | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Nonaccrual loans 90 or more days past due | 222 | 909 | |
Total nonaccrual past due loans | 222 | 909 | |
Current Accruing loans | 716,474 | 722,228 | |
Total non-covered loans and loans held for sale, gross | 716,696 | 723,137 | |
Consumer | Student loans | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 599 | 541 | |
Accruing loans 60 - 89 days past due | 643 | 445 | |
Total accruing past due loans | 1,242 | 986 | |
Nonaccrual loans 90 or more days past due | 2,540 | 1,681 | |
Total nonaccrual past due loans | 2,540 | 1,681 | |
Current Accruing loans | 135,954 | 676,553 | |
Total non-covered loans and loans held for sale, gross | 139,736 | 679,220 | |
Consumer | Other Consumer | ' | ' | |
Aging analysis of past Due non-covered loans and loans held for sale | ' | ' | |
Accruing loans 30 - 59 days past due | 1,798 | 293 | |
Accruing loans 60 - 89 days past due | 11 | 1 | |
Total accruing past due loans | 1,809 | 294 | |
Nonaccrual loans less than 90 days past due | 2 | 175 | |
Nonaccrual loans 90 or more days past due | 957 | 1,263 | |
Total nonaccrual past due loans | 959 | 1,438 | |
Current Accruing loans | 1,213,931 | 866,786 | |
Total non-covered loans and loans held for sale, gross | $1,216,699 | $868,518 | |
[1] | Loans net of ASC 310-30 discount. |
NONCOVERED_LOANS_AND_ALLOWANCE7
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 6) (Non-covered loans, USD $) | 6 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Dec. 31, 2013 |
item | Performing loan | Performing loan | Performing loan | Performing loan | Nonperforming loan | Nonperforming loan | |
A/B Note Splits | A/B Note Splits | ||||||
Restructured loans disclosures | ' | ' | ' | ' | ' | ' | ' |
Number of notes into which A/B notes are split | 2 | ' | ' | ' | ' | ' | ' |
Number of consecutive months of payments considered demonstration of sustained period of performance | '6 months | ' | ' | ' | ' | ' | ' |
Loan balance of restructured loans | ' | $66,200 | $71,800 | $3,400 | $4,300 | $25,700 | $11,100 |
NONCOVERED_LOANS_AND_ALLOWANCE8
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 7) (USD $) | 3 Months Ended | 6 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | ||||
contract | contract | contract | contract | |||||
Residential | ' | ' | ' | ' | ||||
Restructured loans disclosures | ' | ' | ' | ' | ||||
Post-Modification Outstanding Recorded Balance | ' | ' | $8,100 | ' | ||||
Residential | Residential Single-family | Non-covered loans | ' | ' | ' | ' | ||||
Restructured loans disclosures | ' | ' | ' | ' | ||||
Number of contracts modified as TDRs | 1 | ' | 4 | ' | ||||
Pre-Modification Outstanding Recorded Balance | 1,032 | ' | 6,855 | ' | ||||
Post-Modification Outstanding Recorded Balance | 1,030 | [1] | ' | 5,105 | [1] | ' | ||
Residential | Residential Multifamily | Non-covered loans | ' | ' | ' | ' | ||||
Restructured loans disclosures | ' | ' | ' | ' | ||||
Number of contracts modified as TDRs | 1 | 1 | 1 | 1 | ||||
Pre-Modification Outstanding Recorded Balance | 2,513 | 1,093 | 2,513 | 1,093 | ||||
Post-Modification Outstanding Recorded Balance | 2,973 | [1] | 1,093 | [1] | 2,973 | [1] | 1,093 | [1] |
Commercial Real Estate ("CRE") | Income producing | Non-covered loans | ' | ' | ' | ' | ||||
Restructured loans disclosures | ' | ' | ' | ' | ||||
Number of contracts modified as TDRs | 2 | 4 | 2 | 4 | ||||
Pre-Modification Outstanding Recorded Balance | 5,318 | 23,167 | 5,318 | 23,167 | ||||
Post-Modification Outstanding Recorded Balance | 5,254 | [1] | 22,934 | [1] | 5,254 | [1] | 22,934 | [1] |
Financial Impact | ' | 102 | [2] | ' | 102 | [2] | ||
Commercial and Industrial ("C&I") | Commercial Business | Non-covered loans | ' | ' | ' | ' | ||||
Restructured loans disclosures | ' | ' | ' | ' | ||||
Number of contracts modified as TDRs | 2 | 3 | 7 | 4 | ||||
Pre-Modification Outstanding Recorded Balance | 1,165 | 1,204 | 2,886 | 1,246 | ||||
Post-Modification Outstanding Recorded Balance | 1,155 | [1] | 1,201 | [1] | 2,828 | [1] | 1,241 | [1] |
Financial Impact | 563 | [2] | 86 | [2] | 1,811 | [2] | 86 | [2] |
Consumer | Other Consumer | Non-covered loans | ' | ' | ' | ' | ||||
Restructured loans disclosures | ' | ' | ' | ' | ||||
Number of contracts modified as TDRs | ' | ' | ' | 1 | ||||
Pre-Modification Outstanding Recorded Balance | ' | ' | ' | 651 | ||||
Post-Modification Outstanding Recorded Balance | ' | ' | ' | $649 | [1] | |||
[1] | Includes subsequent payments after modification and reflects the balance as of June 30, 2014 and June 30, 2013. | |||||||
[2] | The financial impact includes charge-offs and specific reserves recorded at modification date. |
NONCOVERED_LOANS_AND_ALLOWANCE9
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 8) (Non-covered loans, USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Performing loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | $66,200 | $71,800 |
Nonperforming loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 25,700 | 11,100 |
A/B Note Splits | Performing loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 3,400 | 4,300 |
Residential | Performing loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 17,400 | 17,400 |
Residential | Nonperforming loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 9,000 | 3,600 |
Commercial Real Estate ("CRE") | Performing loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 31,600 | 37,600 |
Commercial Real Estate ("CRE") | Nonperforming loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 11,300 | 3,400 |
Commercial and Industrial ("C&I") | Performing loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 16,400 | 16,700 |
Commercial and Industrial ("C&I") | Nonperforming loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 5,400 | 3,500 |
Consumer | Performing loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | 758 | 108 |
Consumer | Nonperforming loan | ' | ' |
Troubled debt restructuring disclosures | ' | ' |
Loan balance of restructured loans | $0 | $639 |
Recovered_Sheet1
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 9) (Non-covered loans, USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2013 |
Residential | Residential | Commercial Real Estate ("CRE") | Commercial and Industrial ("C&I") | Commercial and Industrial ("C&I") | Commercial and Industrial ("C&I") | |
Residential Single-family | Residential Single-family | Income producing | Commercial Business | Commercial Business | Commercial Business | |
contract | contract | contract | contract | contract | contract | |
Disclosures on loans modified as TDRs that subsequently defaulted | ' | ' | ' | ' | ' | ' |
Number of contracts modified as TDRs that subsequently defaulted | 1 | 3 | 1 | 1 | 1 | 2 |
Balance of loans modified as TDRs that subsequently defaulted | $105 | $2,935 | $2,730 | $500 | $500 | $500 |
Recovered_Sheet2
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 10) (Non-covered loans, USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Performing loan | ' | ' |
Restructured loans disclosures | ' | ' |
Allowance for troubled debt restructurings loans receivable | $14,900 | $13,000 |
Nonperforming loan | ' | ' |
Restructured loans disclosures | ' | ' |
Allowance for troubled debt restructurings loans receivable | $3,000 | $836 |
Recovered_Sheet3
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 11) (USD $) | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | ||||
Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | $200,466,000 | ' | $200,466,000 | ' | $212,637,000 | |||
Recorded Investment With No Allowance | 103,303,000 | ' | 103,303,000 | ' | 110,004,000 | |||
Recorded Investment With Allowance | 65,661,000 | ' | 65,661,000 | ' | 73,473,000 | |||
Recorded investment | 168,964,000 | [1] | ' | 168,964,000 | [1] | ' | 183,477,000 | [1] |
Related allowance | 24,841,000 | ' | 24,841,000 | ' | 24,143,000 | |||
Average recorded investment | 172,844,000 | 160,728,000 | 173,828,000 | 163,339,000 | ' | |||
Interest income recognized (accrual basis) | 855,000 | 2,008,000 | 1,687,000 | 2,643,000 | ' | |||
Covered loans accounted for under ASC 310-10 | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Covered nonaccrual loans | 14,300,000 | ' | 14,300,000 | ' | 17,700,000 | |||
Residential | Single-family | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 16,220,000 | ' | 16,220,000 | ' | 15,814,000 | |||
Recorded Investment With No Allowance | 13,427,000 | ' | 13,427,000 | ' | 13,585,000 | |||
Recorded Investment With Allowance | 1,067,000 | ' | 1,067,000 | ' | 1,588,000 | |||
Recorded investment | 14,494,000 | [1] | ' | 14,494,000 | [1] | ' | 15,173,000 | [1] |
Related allowance | 192,000 | ' | 192,000 | ' | 207,000 | |||
Average recorded investment | 15,131,000 | 11,219,000 | 14,034,000 | 11,497,000 | ' | |||
Interest income recognized (accrual basis) | 65,000 | 38,000 | 115,000 | 77,000 | ' | |||
Residential | Multifamily | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 39,108,000 | ' | 39,108,000 | ' | 43,821,000 | |||
Recorded Investment With No Allowance | 27,617,000 | ' | 27,617,000 | ' | 30,899,000 | |||
Recorded Investment With Allowance | 9,139,000 | ' | 9,139,000 | ' | 10,215,000 | |||
Recorded investment | 36,756,000 | [1] | ' | 36,756,000 | [1] | ' | 41,114,000 | [1] |
Related allowance | 1,185,000 | ' | 1,185,000 | ' | 1,339,000 | |||
Average recorded investment | 36,683,000 | 45,230,000 | 36,817,000 | 45,407,000 | ' | |||
Interest income recognized (accrual basis) | 184,000 | 247,000 | 360,000 | 456,000 | ' | |||
Commercial Real Estate ("CRE") | Income producing | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 65,663,000 | ' | 65,663,000 | ' | 73,777,000 | |||
Recorded Investment With No Allowance | 39,638,000 | ' | 39,638,000 | ' | 39,745,000 | |||
Recorded Investment With Allowance | 18,135,000 | ' | 18,135,000 | ' | 25,523,000 | |||
Recorded investment | 57,773,000 | [1] | ' | 57,773,000 | [1] | ' | 65,268,000 | [1] |
Related allowance | 2,555,000 | ' | 2,555,000 | ' | 5,976,000 | |||
Average recorded investment | 59,121,000 | 57,105,000 | 59,917,000 | 58,098,000 | ' | |||
Interest income recognized (accrual basis) | 303,000 | 1,529,000 | 627,000 | 1,738,000 | ' | |||
Commercial Real Estate ("CRE") | Construction | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 6,888,000 | ' | 6,888,000 | ' | 6,888,000 | |||
Recorded Investment With No Allowance | 6,888,000 | ' | 6,888,000 | ' | 6,888,000 | |||
Recorded investment | 6,888,000 | [1] | ' | 6,888,000 | [1] | ' | 6,888,000 | [1] |
Average recorded investment | 6,888,000 | 6,888,000 | 6,888,000 | 6,888,000 | ' | |||
Commercial Real Estate ("CRE") | Land | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 17,059,000 | ' | 17,059,000 | ' | 17,390,000 | |||
Recorded Investment With No Allowance | 4,217,000 | ' | 4,217,000 | ' | 4,372,000 | |||
Recorded Investment With Allowance | 7,865,000 | ' | 7,865,000 | ' | 7,908,000 | |||
Recorded investment | 12,082,000 | [1] | ' | 12,082,000 | [1] | ' | 12,280,000 | [1] |
Related allowance | 1,991,000 | ' | 1,991,000 | ' | 2,082,000 | |||
Average recorded investment | 12,128,000 | 13,231,000 | 12,179,000 | 13,285,000 | ' | |||
Interest income recognized (accrual basis) | 75,000 | 124,000 | 149,000 | 247,000 | ' | |||
Commercial and Industrial ("C&I") | Commercial Business | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 54,236,000 | ' | 54,236,000 | ' | 48,482,000 | |||
Recorded Investment With No Allowance | 10,497,000 | ' | 10,497,000 | ' | 10,850,000 | |||
Recorded Investment With Allowance | 29,182,000 | ' | 29,182,000 | ' | 27,487,000 | |||
Recorded investment | 39,679,000 | [1] | ' | 39,679,000 | [1] | ' | 38,337,000 | [1] |
Related allowance | 18,645,000 | ' | 18,645,000 | ' | 13,787,000 | |||
Average recorded investment | 41,592,000 | 23,448,000 | 42,682,000 | 24,200,000 | ' | |||
Interest income recognized (accrual basis) | 211,000 | 59,000 | 414,000 | 104,000 | ' | |||
Commercial and Industrial ("C&I") | Trade finance | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 529,000 | ' | 529,000 | ' | 2,771,000 | |||
Recorded Investment With No Allowance | 256,000 | ' | 256,000 | ' | 438,000 | |||
Recorded Investment With Allowance | 273,000 | ' | 273,000 | ' | 752,000 | |||
Recorded investment | 529,000 | [1] | ' | 529,000 | [1] | ' | 1,190,000 | [1] |
Related allowance | 273,000 | ' | 273,000 | ' | 752,000 | |||
Average recorded investment | 546,000 | 2,052,000 | 559,000 | 2,367,000 | ' | |||
Interest income recognized (accrual basis) | 4,000 | 4,000 | 8,000 | 7,000 | ' | |||
Consumer | Other Consumer | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | 763,000 | ' | 763,000 | ' | 1,945,000 | |||
Recorded Investment With No Allowance | 763,000 | ' | 763,000 | ' | 1,546,000 | |||
Recorded investment | 763,000 | [1] | ' | 763,000 | [1] | ' | 1,546,000 | [1] |
Average recorded investment | 755,000 | 1,555,000 | 752,000 | 1,597,000 | ' | |||
Interest income recognized (accrual basis) | 13,000 | 7,000 | 14,000 | 14,000 | ' | |||
Consumer | Student loans | Non-covered loans | ' | ' | ' | ' | ' | |||
Impaired loans disclosures | ' | ' | ' | ' | ' | |||
Unpaid principal balance | ' | ' | ' | ' | 1,749,000 | |||
Recorded Investment With No Allowance | ' | ' | ' | ' | 1,681,000 | |||
Recorded investment | ' | ' | ' | ' | $1,681,000 | [1] | ||
[1] | Excludes $14.3 million and $17.7 million of covered non-accrual loans at June 30, 2014 and December 31, 2013, respectively, accounted for under ASC 310-10, of which some loans have additional partial balances accounted for under ASC 310-30. |
Recovered_Sheet4
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 12) (USD $) | 3 Months Ended | 6 Months Ended | ||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Provision for loan losses | $8,000 | $9,000 | $14,933 | $13,327 | ||
Non-covered loans | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Beginning balance | 245,618 | 228,796 | 241,930 | 229,382 | ||
Provision for loan losses | 8,944 | 8,277 | 16,898 | 7,515 | ||
Provision allocation for unfunded loan commitments and letters of credit | -829 | 432 | -1,044 | 1,148 | ||
Charge-offs | -8,276 | -5,993 | -14,206 | -8,916 | ||
Recoveries | 1,011 | 1,968 | 2,890 | 4,351 | ||
Net charge-offs | -7,265 | -4,025 | -11,316 | -4,565 | ||
Ending balance | 246,468 | 233,480 | 246,468 | 233,480 | ||
Ending balance allocated to: | ' | ' | ' | ' | ||
Individually evaluated for impairment | 24,841 | 13,147 | 24,841 | 13,147 | ||
Collectively evaluated for impairment | 221,257 | 220,333 | 221,257 | 220,333 | ||
Acquired with deteriorated credit quality | 370 | ' | 370 | ' | ||
Ending balance | 246,468 | 233,480 | 246,468 | 233,480 | ||
Non-covered loans | MetroCorp | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Charge-offs | 523 | ' | 523 | ' | ||
Residential | Non-covered loans | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Beginning balance | 47,827 | 46,880 | 50,717 | 49,349 | ||
Provision for loan losses | -2,046 | 704 | -4,790 | -2,222 | ||
Charge-offs | -61 | -550 | -343 | -861 | ||
Recoveries | 63 | 303 | 199 | 1,071 | ||
Net charge-offs | 2 | -247 | -144 | 210 | ||
Ending balance | 45,783 | 47,337 | 45,783 | 47,337 | ||
Ending balance allocated to: | ' | ' | ' | ' | ||
Individually evaluated for impairment | 1,377 | 1,508 | 1,377 | 1,508 | ||
Collectively evaluated for impairment | 44,406 | 45,829 | 44,406 | 45,829 | ||
Ending balance | 45,783 | 47,337 | 45,783 | 47,337 | ||
Commercial Real Estate ("CRE") | Non-covered loans | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Beginning balance | 62,739 | 72,958 | 64,677 | 69,856 | ||
Provision for loan losses | -1,376 | -426 | -3,823 | 3,392 | ||
Charge-offs | -1,314 | [1] | -762 | -1,634 | [1] | -1,767 |
Recoveries | 551 | 1,060 | 1,380 | 1,349 | ||
Net charge-offs | -763 | 298 | -254 | -418 | ||
Ending balance | 60,600 | 72,830 | 60,600 | 72,830 | ||
Ending balance allocated to: | ' | ' | ' | ' | ||
Individually evaluated for impairment | 4,546 | 7,931 | 4,546 | 7,931 | ||
Collectively evaluated for impairment | 55,684 | 64,899 | 55,684 | 64,899 | ||
Acquired with deteriorated credit quality | 370 | ' | 370 | ' | ||
Ending balance | 60,600 | 72,830 | 60,600 | 72,830 | ||
Commercial and Industrial ("C&I") | Non-covered loans | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Beginning balance | 124,201 | 102,346 | 115,184 | 105,376 | ||
Provision for loan losses | 10,784 | 6,241 | 24,215 | 3,941 | ||
Charge-offs | -6,899 | -3,816 | -12,224 | -5,077 | ||
Recoveries | 393 | 605 | 1,304 | 1,136 | ||
Net charge-offs | -6,506 | -3,211 | -10,920 | -3,941 | ||
Ending balance | 128,479 | 105,376 | 128,479 | 105,376 | ||
Ending balance allocated to: | ' | ' | ' | ' | ||
Individually evaluated for impairment | 18,918 | 3,708 | 18,918 | 3,708 | ||
Collectively evaluated for impairment | 109,561 | 101,668 | 109,561 | 101,668 | ||
Ending balance | 128,479 | 105,376 | 128,479 | 105,376 | ||
Consumer | Non-covered loans | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Beginning balance | 10,851 | 6,612 | 11,352 | 4,801 | ||
Provision for loan losses | 753 | 2,190 | 252 | 3,552 | ||
Charge-offs | -2 | -865 | -5 | -1,211 | ||
Recoveries | 4 | ' | 7 | 795 | ||
Net charge-offs | 2 | -865 | 2 | -416 | ||
Ending balance | 11,606 | 7,937 | 11,606 | 7,937 | ||
Ending balance allocated to: | ' | ' | ' | ' | ||
Collectively evaluated for impairment | 11,606 | 7,937 | 11,606 | 7,937 | ||
Ending balance | 11,606 | 7,937 | 11,606 | 7,937 | ||
Unallocated | Non-covered loans | ' | ' | ' | ' | ||
Financing Receivable Allowance for Credit Losses Roll Forward | ' | ' | ' | ' | ||
Provision for loan losses | 829 | -432 | 1,044 | -1,148 | ||
Provision allocation for unfunded loan commitments and letters of credit | ($829) | $432 | ($1,044) | $1,148 | ||
[1] | Includes charge-off of $523 thousand relating to PCI loans acquired from MetroCorp. |
Recovered_Sheet5
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 13) (Non-covered loans, USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Recorded investment in total loans receivable related to each balance in the allowance for loan losses | ' | ' |
Individually evaluated for impairment | $168,964 | $183,477 |
Collectively evaluated for impairment | 18,049,911 | 15,494,840 |
Acquired with deteriorated credit quality | 58,893 | ' |
Ending balance | 18,277,768 | 15,678,317 |
Residential | ' | ' |
Recorded investment in total loans receivable related to each balance in the allowance for loan losses | ' | ' |
Individually evaluated for impairment | 51,250 | 56,287 |
Collectively evaluated for impairment | 4,397,218 | 4,129,022 |
Acquired with deteriorated credit quality | 1,259 | ' |
Ending balance | 4,449,727 | 4,185,309 |
Commercial Real Estate ("CRE") | ' | ' |
Recorded investment in total loans receivable related to each balance in the allowance for loan losses | ' | ' |
Individually evaluated for impairment | 76,743 | 84,436 |
Collectively evaluated for impairment | 5,665,843 | 4,500,641 |
Acquired with deteriorated credit quality | 55,717 | ' |
Ending balance | 5,798,303 | 4,585,077 |
Commercial and Industrial ("C&I") | ' | ' |
Recorded investment in total loans receivable related to each balance in the allowance for loan losses | ' | ' |
Individually evaluated for impairment | 40,208 | 39,527 |
Collectively evaluated for impairment | 6,631,178 | 5,320,666 |
Acquired with deteriorated credit quality | 1,917 | ' |
Ending balance | 6,673,303 | 5,360,193 |
Consumer | ' | ' |
Recorded investment in total loans receivable related to each balance in the allowance for loan losses | ' | ' |
Individually evaluated for impairment | 763 | 3,227 |
Collectively evaluated for impairment | 1,355,672 | 1,544,511 |
Ending balance | $1,356,435 | $1,547,738 |
Recovered_Sheet6
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 14) (Non-covered loans, USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Non-covered loans | ' | ' |
Allowance for Unfunded Loan Commitments, Off-Balance Sheet Credit Exposures and Recourse Provisions | ' | ' |
Allowance for unfunded loan commitments, off-balance sheet credit exposures and recourse provision | $12,300,000 | $11,300,000 |
Off-balance sheet loans serviced for others | 1,210,000,000 | 1,350,000,000 |
Portion of allowance for unfunded loan commitments, off-balance sheet credit exposures and recourse provisions related to off-balance sheet loans sold and securitized | $2,600,000 | $3,200,000 |
Recovered_Sheet7
NON-COVERED LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 15) (Non-covered loans, MetroCorp, USD $) | 3 Months Ended | 6 Months Ended |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2014 |
Non-covered loans | MetroCorp | ' | ' |
Changes in the accretable yield for the PCI loans | ' | ' |
Balance at beginning of period | $6,452 | ' |
Additions | ' | 6,745 |
Accretion | -1,509 | -2,265 |
Changes in expected cash flows | 824 | 1,287 |
Balance at end of period | $5,767 | $5,767 |
AFFORDABLE_HOUSING_PARTNERSHIP1
AFFORDABLE HOUSING PARTNERSHIPS AND OTHER INVESTMENTS (Details) (USD $) | 6 Months Ended | |
In Millions, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2013 |
AFFORDABLE HOUSING PARTNERSHIPS AND OTHER INVESTMENTS | ' | ' |
Minimum compliance period to fully utilize the tax credits | '15 years | ' |
Investments in affordable housing partnerships | $181.90 | $164.80 |
Other investments in affordable housing partnerships | 90.7 | 70.2 |
Total unfunded commitments for investments | $86.60 | $73.10 |
GOODWILL_AND_OTHER_INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) (USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Jan. 17, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 | |
MetroCorp | Premiums on acquired deposits | Premiums on acquired deposits | Premiums on acquired deposits | Premiums on acquired deposits | Premiums on acquired deposits | |||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | $458,467,000 | $337,438,000 | $458,467,000 | $337,438,000 | $337,438,000 | ' | $121,000,000 | ' | ' | ' | ' | ' |
Market capitalization | 5,020,000,000 | ' | 5,020,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total stockholders' equity | 2,701,024,000 | 2,257,951,000 | 2,701,024,000 | 2,257,951,000 | 2,364,225,000 | 2,382,122,000 | ' | ' | ' | ' | ' | ' |
Premiums on Acquired Deposits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross carrying amount of premiums on acquired deposits | ' | ' | ' | ' | ' | ' | ' | 108,800,000 | ' | 108,800,000 | ' | 100,200,000 |
Intangible recorded due to the acquisition of MetroCorp | ' | ' | ' | ' | ' | ' | 8,600,000 | ' | ' | ' | ' | ' |
Accumulated amortization for premiums on acquired deposits | ' | ' | ' | ' | ' | ' | ' | 58,400,000 | ' | 58,400,000 | ' | 53,300,000 |
Amortization expense of premiums on acquired deposits | 2,624,000 | 2,375,000 | 5,124,000 | 4,784,000 | ' | ' | ' | 2,624,000 | 2,375,000 | 5,124,000 | 4,784,000 | ' |
Estimated Future Amortization Expense of Premiums on Acquired Deposits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Six Months Ending December 31, 2014 | 5,080,000 | ' | 5,080,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Year Ending December 31, 2015 | 9,234,000 | ' | 9,234,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Year Ending December 31, 2016 | 8,086,000 | ' | 8,086,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Year Ending December 31, 2017 | 6,935,000 | ' | 6,935,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Year Ending December 31, 2018 | 5,883,000 | ' | 5,883,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | 15,171,000 | ' | 15,171,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | $50,389,000 | ' | $50,389,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Billions, unless otherwise specified | ||
Undisbursed Loan Commitments | ' | ' |
Credit Extensions | ' | ' |
Loan | $4.40 | $4.02 |
Commercial and Standby Letters of Credit | ' | ' |
Credit Extensions | ' | ' |
Commercial and standby letters of credit issued | $1.13 | $1.16 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details 2) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Other Commitments | ' | ' |
Other Commitments | $86.60 | $73.10 |
Loans Sold or Securitized with Recourse | ' | ' |
Guarantees | ' | ' |
Principal amount of single-family loans with full recourse sold or securitized | 38.1 | 42.2 |
Principal amount of multifamily loans with limited recourse sold or securitized | 256.1 | 296.6 |
Principal amount of loans sold or securitized | 294.2 | 338.8 |
Recourse provision limitation, maximum percentage of the top loss on the multifamily loans | 4.00% | 4.00% |
Recourse reserve related to loan sales and securitizations totaled | 2.6 | 3.2 |
Commitment to repurchase the loan | 0 | ' |
Loans Sold without Recourse | ' | ' |
Guarantees | ' | ' |
Principal amount of loans sold or securitized | 735.9 | 818.2 |
Loans Securitized without Recourse | ' | ' |
Guarantees | ' | ' |
Principal amount of loans sold or securitized | $177.70 | $193.80 |
STOCKHOLDERS_EQUITY_AND_EARNIN2
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE (Details) (USD $) | 0 Months Ended | 3 Months Ended | 6 Months Ended | 0 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Jan. 17, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jan. 17, 2014 | Jan. 16, 2014 | 1-May-13 | Apr. 30, 2008 | Jul. 17, 2013 | Apr. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 |
MetroCorp | MetroCorp | Series A Non-Cumulative Perpetual Convertible Preferred Stock | Series A Non-Cumulative Perpetual Convertible Preferred Stock | Common Stock | Common Stock | Common Stock | Common Stock | ||||||
Class of Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares issued during the period | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | ' | ' | ' |
Preferred stock dividend rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | ' |
Preferred stock liquidation preference (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | $1,000 | ' | ' | ' | ' |
Proceeds from issuance of convertible preferred stock | ' | ' | ' | ' | ' | ' | ' | ' | $194.10 | ' | ' | ' | ' |
Preferred shares converted | ' | ' | ' | ' | ' | ' | ' | 85,710 | ' | ' | ' | ' | ' |
Common stock issued on conversion of convertible preferred stock | ' | ' | ' | ' | ' | ' | ' | 5,594,080 | ' | ' | ' | ' | ' |
Final consideration (in shares) | ' | ' | ' | 5,583,093 | ' | 5,583,093 | ' | ' | ' | ' | ' | ' | ' |
Final consideration in cash | ' | ' | ' | ' | ' | 89.4 | ' | ' | ' | ' | ' | ' | ' |
Number of outstanding warrants (in shares) | ' | 230,282 | ' | 230,282 | ' | ' | 771,429 | ' | ' | ' | ' | ' | ' |
Common stock equivalent to assumed obligation of acquiree's unexercised warrant (in shares) | 230,282 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of stock repurchase approved by the Board of Directors | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100 | ' | ' | ' |
Purchase of treasury stock pursuant to the Stock Repurchase Program, shares | ' | ' | ' | ' | 8,026,807 | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average price of shares repurchased (in dollars per share) | ' | ' | ' | ' | $24.89 | ' | ' | ' | ' | ' | ' | ' | ' |
Total cost of repurchase of treasury shares | ' | ' | 200 | ' | 200 | ' | ' | ' | ' | ' | ' | ' | ' |
Quarterly Dividends | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend per share (in dollars per share) | ' | $0.18 | $0.15 | $0.36 | $0.30 | ' | ' | ' | ' | ' | $0.18 | ' | ' |
Common stock cash dividends paid | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $26 | $52 |
STOCKHOLDERS_EQUITY_AND_EARNIN3
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 |
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE | ' | ' | ' | ' | ' |
Common stock, shares outstanding | 143,389,155 | ' | 143,389,155 | ' | 137,630,896 |
Earnings per share calculations | ' | ' | ' | ' | ' |
Net income | $83,988 | $74,015 | $160,729 | $146,106 | ' |
Less: Preferred stock dividends | ' | -1,714 | ' | -3,428 | ' |
Less: Earnings allocated to participating securities | -119 | -400 | -287 | -988 | ' |
Basic EPS - income allocated to common stockholders | 83,869 | 71,901 | 160,442 | 141,690 | ' |
Effect of dilutive securities: | ' | ' | ' | ' | ' |
Restricted stock units | 51 | 33 | 129 | 68 | ' |
Convertible preferred stock | ' | ' | ' | 3,428 | ' |
Diluted EPS - income allocated to common stockholders | $83,920 | $71,934 | $160,571 | $145,186 | ' |
Number of Shares | ' | ' | ' | ' | ' |
Weighted average shares outstanding | 143,187,000 | 137,536,000 | 142,578,000 | 137,592,000 | ' |
Effect of dilutive securities on weighted average shares outstanding | ' | ' | ' | ' | ' |
Stock options (in shares) | 75,000 | 59,000 | 77,000 | 55,000 | ' |
Restricted stock units (in shares) | 284,000 | 221,000 | 359,000 | 227,000 | ' |
Convertible preferred stock (in shares) | ' | ' | ' | 3,699,000 | ' |
Warrants (in shares) | 143,000 | ' | 144,000 | ' | ' |
Total weighted average diluted shares outstanding | 143,689,000 | 137,816,000 | 143,158,000 | 141,573,000 | ' |
Per Share Amounts | ' | ' | ' | ' | ' |
Basic EPS - income allocated to common stockholders (in dollars per share) | $0.59 | $0.52 | $1.13 | $1.03 | ' |
Diluted EPS - Income available to common stockholders (in dollars per share) | $0.58 | $0.52 | $1.12 | $1.03 | ' |
STOCKHOLDERS_EQUITY_AND_EARNIN4
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE (Details 3) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Convertible preferred stock | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Excluded from the computation of diluted EPS (in shares) | ' | 1,841 | ' | ' |
Stock options | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Excluded from the computation of diluted EPS (in shares) | ' | 159 | 40 | 214 |
Restricted stock units | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ' | ' | ' |
Excluded from the computation of diluted EPS (in shares) | 2 | 6 | 61 | 4 |
STOCKHOLDERS_EQUITY_AND_EARNIN5
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE (Details 4) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Statement | ' | ' | ' | ' |
Balance at beginning of period | ($17,037) | $6,185 | ($30,459) | $4,669 |
Net unrealized gains (losses) arising during the period | 14,891 | -24,763 | 30,296 | -20,012 |
Less: reclassification adjustment for gains included in net income | -389 | -3,100 | -2,372 | -6,335 |
Net unrealized gains (losses) | 14,502 | -27,863 | 27,924 | -26,347 |
Balance at end of period | -2,535 | -21,678 | -2,535 | -21,678 |
Investment Securities Available-for-Sale | ' | ' | ' | ' |
Statement | ' | ' | ' | ' |
Balance at beginning of period | -17,099 | 6,149 | -30,538 | 4,643 |
Net unrealized gains (losses) arising during the period | 14,895 | -24,770 | 30,317 | -20,029 |
Less: reclassification adjustment for gains included in net income | -389 | -3,100 | -2,372 | -6,335 |
Net unrealized gains (losses) | 14,506 | -27,870 | 27,945 | -26,364 |
Balance at end of period | -2,593 | -21,721 | -2,593 | -21,721 |
Other Investment | ' | ' | ' | ' |
Statement | ' | ' | ' | ' |
Balance at beginning of period | 62 | 36 | 79 | 26 |
Net unrealized gains (losses) arising during the period | -4 | 7 | -21 | 17 |
Net unrealized gains (losses) | -4 | 7 | -21 | 17 |
Balance at end of period | $58 | $43 | $58 | $43 |
STOCKHOLDERS_EQUITY_AND_EARNIN6
STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE (Details 5) (USD $) | 3 Months Ended | 6 Months Ended | ||||||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | ||||
Unrealized gains (losses) on investment securities available-for-sale: | ' | ' | ' | ' | ||||
Net unrealized gains (losses) arising during period, before-tax amount | $25,681 | ($42,707) | $52,271 | ($34,533) | ||||
Less: reclassification adjustment for gains included in net income, before-tax amount | -671 | [1] | -5,345 | [1] | -4,089 | [1] | -10,922 | [1] |
Net unrealized gains (losses) , before-tax amount | 25,010 | -48,052 | 48,182 | -45,455 | ||||
Net unrealized (losses) gains arising during the period, before-tax amount | -7 | 12 | -36 | 29 | ||||
Other comprehensive income (loss), before-tax amount | 25,003 | -48,040 | 48,146 | -45,426 | ||||
Unrealized gains (losses) on investment securities available-for-sale: | ' | ' | ' | ' | ||||
Net unrealized gains (losses) arising during period, tax (expense) or benefit | -10,786 | 17,937 | -21,954 | 14,504 | ||||
Less: reclassification adjustment for gains included in net income, tax (expense) or benefit | 282 | [1] | 2,245 | [1] | 1,717 | [1] | 4,587 | [1] |
Net unrealized gains (losses) , tax (expense) or benefit | -10,504 | 20,182 | -20,237 | 19,091 | ||||
Net unrealized (losses) gains arising during the period, tax (expense) or benefit | 3 | -5 | 15 | -12 | ||||
Other comprehensive income (loss), tax (expense) or benefit | -10,501 | 20,177 | -20,222 | 19,079 | ||||
Unrealized gains (losses) on investment securities available-for-sale: | ' | ' | ' | ' | ||||
Net unrealized gains (losses) arising during period, net of tax amount | 14,895 | -24,770 | 30,317 | -20,029 | ||||
Less: reclassification adjustment for gains included in net income, net of tax amount | -389 | [1] | -3,100 | [1] | -2,372 | [1] | -6,335 | [1] |
Net unrealized gains (losses) , net of tax amount | 14,506 | -27,870 | 27,945 | -26,364 | ||||
Net unrealized (losses) gains arising during the period, net of tax amount | -4 | 7 | -21 | 17 | ||||
Other comprehensive income (loss) | $14,502 | ($27,863) | $27,924 | ($26,347) | ||||
[1] | The pretax amount is reported in net gains on sales of investment securities in the consolidated statements of operations. |
BUSINESS_SEGMENTS_Details
BUSINESS SEGMENTS (Details) | 6 Months Ended |
Jun. 30, 2014 | |
item | |
BUSINESS SEGMENTS | ' |
Number of operating segments | 3 |
Number of business divisions | 3 |
Number of segment whom broad administrative support are provided | 2 |
BUSINESS_SEGMENTS_Details_2
BUSINESS SEGMENTS (Details 2) (USD $) | 3 Months Ended | 6 Months Ended | |||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2013 |
Segment Reporting Information | ' | ' | ' | ' | ' |
Interest income | $294,442 | $255,353 | $580,615 | $493,776 | ' |
Charge for funds used | -68,064 | -45,628 | -128,560 | -84,412 | ' |
Interest spread on funds used | 226,378 | 209,725 | 452,055 | 409,364 | ' |
Interest expense | -27,992 | -27,709 | -56,199 | -56,841 | ' |
Credit on funds provided | 68,064 | 45,628 | 128,560 | 84,412 | ' |
Interest spread on funds provided | 40,072 | 17,919 | 72,361 | 27,571 | ' |
Net interest income (loss) | 266,450 | 227,644 | 524,416 | 436,935 | ' |
Provision for loan losses | 8,000 | 9,000 | 14,933 | 13,327 | ' |
Depreciation, amortization and accretion | 22,318 | 23,912 | 35,854 | 38,909 | ' |
Goodwill | 458,467 | 337,438 | 458,467 | 337,438 | 337,438 |
Segment pre-tax profit (loss) | 115,606 | 111,870 | 227,296 | 218,380 | ' |
Segment assets | 27,557,105 | 23,308,406 | 27,557,105 | 23,308,406 | 24,730,068 |
Retail Banking | ' | ' | ' | ' | ' |
Segment Reporting Information | ' | ' | ' | ' | ' |
Interest income | 99,792 | 93,928 | 198,517 | 176,767 | ' |
Charge for funds used | -23,854 | -17,901 | -48,150 | -37,885 | ' |
Interest spread on funds used | 75,938 | 76,027 | 150,367 | 138,882 | ' |
Interest expense | -11,950 | -11,708 | -23,661 | -24,353 | ' |
Credit on funds provided | 54,139 | 36,022 | 102,332 | 68,418 | ' |
Interest spread on funds provided | 42,189 | 24,314 | 78,671 | 44,065 | ' |
Net interest income (loss) | 118,127 | 100,341 | 229,038 | 182,947 | ' |
Provision for loan losses | -440 | 2,886 | 2,212 | 6,566 | ' |
Depreciation, amortization and accretion | 4,096 | 5,865 | 6,667 | 8,286 | ' |
Goodwill | 354,163 | 320,566 | 354,163 | 320,566 | ' |
Segment pre-tax profit (loss) | 45,691 | 32,493 | 88,022 | 51,420 | ' |
Segment assets | 7,822,020 | 7,035,908 | 7,822,020 | 7,035,908 | ' |
Commercial Banking | ' | ' | ' | ' | ' |
Segment Reporting Information | ' | ' | ' | ' | ' |
Interest income | 181,880 | 147,168 | 350,956 | 287,228 | ' |
Charge for funds used | -34,281 | -27,883 | -66,098 | -55,956 | ' |
Interest spread on funds used | 147,599 | 119,285 | 284,858 | 231,272 | ' |
Interest expense | -3,421 | -3,940 | -6,701 | -8,317 | ' |
Credit on funds provided | 8,983 | 5,711 | 17,419 | 9,334 | ' |
Interest spread on funds provided | 5,562 | 1,771 | 10,718 | 1,017 | ' |
Net interest income (loss) | 153,161 | 121,056 | 295,576 | 232,289 | ' |
Provision for loan losses | 8,440 | 6,114 | 12,721 | 6,761 | ' |
Depreciation, amortization and accretion | -1,286 | 3,445 | -4,614 | 626 | ' |
Goodwill | 104,304 | 16,872 | 104,304 | 16,872 | ' |
Segment pre-tax profit (loss) | 73,987 | 65,514 | 148,718 | 132,195 | ' |
Segment assets | 14,177,634 | 10,903,753 | 14,177,634 | 10,903,753 | ' |
Other | ' | ' | ' | ' | ' |
Segment Reporting Information | ' | ' | ' | ' | ' |
Interest income | 12,770 | 14,257 | 31,142 | 29,781 | ' |
Charge for funds used | -9,929 | 156 | -14,312 | 9,429 | ' |
Interest spread on funds used | 2,841 | 14,413 | 16,830 | 39,210 | ' |
Interest expense | -12,621 | -12,061 | -25,837 | -24,171 | ' |
Credit on funds provided | 4,942 | 3,895 | 8,809 | 6,660 | ' |
Interest spread on funds provided | -7,679 | -8,166 | -17,028 | -17,511 | ' |
Net interest income (loss) | -4,838 | 6,247 | -198 | 21,699 | ' |
Depreciation, amortization and accretion | 19,508 | 14,602 | 33,801 | 29,997 | ' |
Segment pre-tax profit (loss) | -4,072 | 13,863 | -9,444 | 34,765 | ' |
Segment assets | $5,557,451 | $5,368,745 | $5,557,451 | $5,368,745 | ' |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (Subsequent event, Dividend declared, Common stock, USD $) | Jul. 30, 2014 |
Subsequent event | Dividend declared | Common stock | ' |
Subsequent events | ' |
Dividend payable (in dollars per share) | $0.18 |