Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 05, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | Hilltop Holdings Inc. | |
Entity Central Index Key | 1,265,131 | |
Trading Symbol | hth | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Current Reporting Status | Yes | |
Entity Common Stock, Shares Outstanding | 98,895,584 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Assets | ||
Cash and due from banks | $ 526,692 | $ 782,473 |
Federal funds sold | 24,861 | 30,602 |
Securities purchased under agreements to resell | 83,889 | |
Assets segregated for regulatory purposes | 228,251 | 76,013 |
Securities: | ||
Trading, at fair value | 292,418 | 65,717 |
Available for sale, at fair value (amortized cost of $719,212 and $924,755 respectively) | 726,132 | 925,535 |
Held to maturity, at amortized cost (fair value of $308,031 and $118,345, respectively) | 305,316 | 118,209 |
Total securities | 1,323,866 | 1,109,461 |
Loans held for sale | 1,354,107 | 1,309,693 |
Non-covered loans, net of unearned income | 4,999,529 | 3,920,476 |
Allowance for non-covered loan losses | (42,989) | (37,041) |
Non-covered loans, net | 4,956,540 | 3,883,435 |
Covered loans, net of allowance of $1,870 and $4,611, respectively | 420,547 | 638,029 |
Broker-dealer and clearing organization receivables | 2,111,864 | 167,884 |
Premises and equipment, net | 204,273 | 206,991 |
FDIC indemnification asset | 92,902 | 130,437 |
Covered other real estate owned | 106,024 | 136,945 |
Other assets | 644,916 | 458,862 |
Goodwill | 251,808 | 251,808 |
Other intangible assets, net | 58,916 | 59,783 |
Total assets | 12,389,456 | 9,242,416 |
Deposits: | ||
Noninterest-bearing | 2,173,890 | 2,076,385 |
Interest-bearing | 4,646,859 | 4,293,507 |
Total deposits | 6,820,749 | 6,369,892 |
Broker-dealer and clearing organization payables | 2,045,604 | 179,042 |
Short-term borrowings | 910,490 | 762,696 |
Securities sold, not yet purchased, at fair value | 156,775 | 48 |
Notes payable | 243,556 | 56,684 |
Junior subordinated debentures | 67,012 | 67,012 |
Other liabilities | 428,442 | 345,803 |
Total liabilities | $ 10,672,628 | $ 7,781,177 |
Commitments and contingencies (see Notes 13 and 14) | ||
Hilltop stockholders' equity: | ||
Preferred stock, $0.01 par value, 10,000,000 shares authorized; Series B, liquidation value per share of $1,000; 114,068 shares issued and outstanding at December 31, 2014 | $ 114,068 | |
Common stock, $0.01 par value, 125,000,000 shares authorized; 98,892,539 and 90,181,888 shares issued and outstanding, respectively | $ 989 | 902 |
Additional paid-in capital | 1,574,769 | 1,390,788 |
Accumulated other comprehensive income | 4,592 | 651 |
Retained earnings (accumulated deficit) | 134,748 | (45,957) |
Deferred compensation employee stock trust, net | 1,182 | |
Employee stock trust (29,589 shares, at cost) | (590) | |
Total Hilltop stockholders' equity | 1,715,690 | 1,460,452 |
Noncontrolling interests | 1,138 | 787 |
Total stockholders' equity | 1,716,828 | 1,461,239 |
Total liabilities and stockholders' equity | $ 12,389,456 | $ 9,242,416 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Available for sale, amortized cost (in dollars) | $ 719,212 | $ 924,755 |
Held to maturity, fair value | 308,031 | 118,345 |
Covered loans, allowance | $ 1,870 | $ 4,611 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 125,000,000 | 125,000,000 |
Common stock, shares issued | 98,892,539 | 90,181,888 |
Common stock, shares outstanding | 98,892,539 | 90,181,888 |
Employee stock trust, shares | 29,589 | |
Series B Preferred Stock | ||
Preferred stock, liquidation value per share (in dollars per share) | $ 1,000 | |
Preferred stock, shares issued | 114,068 | |
Preferred stock, shares outstanding | 114,068 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Interest income: | ||||
Loans, including fees | $ 111,315 | $ 80,719 | $ 295,670 | $ 252,667 |
Securities borrowed | 10,116 | 2,078 | 29,809 | 5,420 |
Securities: | ||||
Taxable | 6,262 | 7,688 | 19,538 | 22,894 |
Tax-exempt | 1,683 | 1,150 | 4,981 | 3,579 |
Other | 1,169 | 1,582 | 3,878 | 4,893 |
Total interest income | 130,545 | 93,217 | 353,876 | 289,453 |
Interest expense: | ||||
Deposits | 3,719 | 4,117 | 11,934 | 10,972 |
Securities loaned | 7,110 | 1,182 | 21,505 | 2,947 |
Short-term borrowings | 1,189 | 667 | 3,356 | 1,606 |
Notes payable | 2,524 | 633 | 5,482 | 1,913 |
Junior subordinated debentures | 605 | 594 | 1,785 | 1,765 |
Other | 187 | 264 | 544 | 623 |
Total interest expense | 15,334 | 7,457 | 44,606 | 19,826 |
Net interest income | 115,211 | 85,760 | 309,270 | 269,627 |
Provision for loan losses | 5,593 | 4,033 | 8,438 | 12,808 |
Net interest income after provision for loan losses | 109,618 | 81,727 | 300,832 | 256,819 |
Noninterest income: | ||||
Net realized gains on securities | 4,403 | |||
Net gains from sale of loans and other mortgage production income | 137,303 | 108,621 | 405,023 | 293,786 |
Mortgage loan origination fees | 22,647 | 17,593 | 58,194 | 46,920 |
Net insurance premiums earned | 41,196 | 41,821 | 121,081 | 122,917 |
Securities commissions and fee | 39,070 | 6,865 | 123,201 | 20,857 |
Investment and securities advisory fees and commissions | 27,667 | 17,190 | 82,254 | 46,797 |
Bargain purchase gain | 81,289 | |||
Other | 28,586 | 20,045 | 75,270 | 54,239 |
Total noninterest income | 296,469 | 212,135 | 950,715 | 585,516 |
Noninterest expense: | ||||
Employees' compensation and benefits | 200,620 | 126,472 | 583,415 | 357,280 |
Loss and loss adjustment expenses | 17,335 | 22,629 | 77,436 | 76,241 |
Policy acquisition and other underwriting expenses | 11,784 | 11,571 | 35,198 | 34,910 |
Occupancy and equipment, net | 29,341 | 25,345 | 89,368 | 77,445 |
Other | 74,422 | 68,727 | 215,878 | 172,709 |
Total noninterest expense | 333,502 | 254,744 | 1,001,295 | 718,585 |
Income before income taxes | 72,585 | 39,118 | 250,252 | 123,750 |
Income tax expense | 25,338 | 14,010 | 58,895 | 44,658 |
Net income | 47,247 | 25,108 | 191,357 | 79,092 |
Less: Net income attributable to noncontrolling interest | 353 | 296 | 1,111 | 583 |
Income attributable to Hilltop | 46,894 | 24,812 | 190,246 | 78,509 |
Dividends on preferred stock | 1,426 | 1,854 | 4,278 | |
Income applicable to Hilltop common stockholders | $ 46,894 | $ 23,386 | $ 188,392 | $ 74,231 |
Earnings per common share: | ||||
Basic (in dollars per share) | $ 0.47 | $ 0.26 | $ 1.89 | $ 0.82 |
Diluted (in dollars per share) | $ 0.47 | $ 0.26 | $ 1.88 | $ 0.82 |
Weighted average share information: | ||||
Basic (in shares) | 98,676 | 89,711 | 99,297 | 89,709 |
Diluted (in shares) | 99,556 | 90,558 | 100,191 | 90,570 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income | $ 47,247 | $ 25,108 | $ 191,357 | $ 79,092 |
Other comprehensive income (loss): | ||||
Net unrealized gains (losses) on securities available for sale, net of tax of $3,222, $(656), $3,847 and $16,565, respectively | 5,697 | (1,226) | 6,755 | 31,136 |
Reclassification adjustment for gains included in net income, net of tax of $(1,589) | (2,814) | |||
Comprehensive income | 52,944 | 23,882 | 195,298 | 110,228 |
Less: comprehensive income attributable to noncontrolling interest | 353 | 296 | 1,111 | 583 |
Comprehensive income applicable to Hilltop | $ 52,591 | $ 23,586 | $ 194,187 | $ 109,645 |
CONSOLIDATED STATEMENTS OF COM6
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net unrealized gains on securities available for sale and other, tax | $ 3,222 | $ (656) | $ 3,847 | $ 16,565 |
Other comprehensive income reclassification adjustment, tax | $ (1,589) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Parent | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Accumulated Deficit). | Deferred Compensation Employee Stock Trust, Net | Employee Stock Trust | Noncontrolling Interest | Total |
Balance at Dec. 31, 2013 | $ 1,311,141 | $ 114,068 | $ 902 | $ 1,388,641 | $ (34,863) | $ (157,607) | $ 781 | $ 1,311,922 | ||
Balance (in shares) at Dec. 31, 2013 | 114,000 | 90,176,000 | ||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net income | 78,509 | 78,509 | 583 | 79,092 | ||||||
Other comprehensive income (loss) | 31,136 | 31,136 | 31,136 | |||||||
Issuance of common stock | 3,001 | 3,001 | 3,001 | |||||||
Stock-based compensation expense | 3,316 | 3,316 | 3,316 | |||||||
Common stock issued to board members | 162 | 162 | 162 | |||||||
Common stock issued to board members (in shares) | 7,000 | |||||||||
Forfeiture of restricted common stock awards | (12) | (12) | (12) | |||||||
Forfeiture of restricted common stock awards (in shares) | (3,000) | |||||||||
Dividends on preferred stock | (4,278) | (4,278) | (4,278) | |||||||
Net cash distributed to noncontrolling interest | (595) | (595) | ||||||||
Balance at Sep. 30, 2014 | 1,422,975 | $ 114,068 | $ 902 | 1,390,830 | (3,727) | (79,098) | 769 | 1,423,744 | ||
Balance (in shares) at Sep. 30, 2014 | 114,000 | 90,180,000 | ||||||||
Balance at Dec. 31, 2014 | 1,460,452 | $ 114,068 | $ 902 | 1,390,788 | 651 | (45,957) | 787 | 1,461,239 | ||
Balance (in shares) at Dec. 31, 2014 | 114,000 | 90,182,000 | ||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net income | 190,246 | 190,246 | 1,111 | 191,357 | ||||||
Other comprehensive income (loss) | 3,941 | 3,941 | 3,941 | |||||||
Issuance of common stock | 200,033 | $ 101 | 199,932 | 200,033 | ||||||
Issuance of common stock (in shares) | 10,113,000 | |||||||||
Stock-based compensation expense | 6,220 | 6,220 | 6,220 | |||||||
Common stock issued to board members | 173 | 173 | 173 | |||||||
Common stock issued to board members (in shares) | 8,000 | |||||||||
Forfeiture of restricted common stock awards | (17) | (17) | (17) | |||||||
Forfeiture of restricted common stock awards (in shares) | (19,000) | |||||||||
Dividends on preferred stock | (1,854) | (1,854) | (1,854) | |||||||
Redemption of preferred stock | (114,068) | $ (114,068) | (114,068) | |||||||
Redemption of preferred stock (in shares) | (114,000) | |||||||||
Repurchase of common stock | (30,028) | $ (14) | (22,327) | (7,687) | $ (30,028) | |||||
Repurchase of common stock (in shares) | (1,391,000) | (1,390,977) | ||||||||
Deferred compensation plan | 592 | $ 1,182 | $ (590) | $ 592 | ||||||
Deferred compensation plan (in shares) | 30,000 | |||||||||
Net cash distributed to noncontrolling interest | (760) | (760) | ||||||||
Balance at Sep. 30, 2015 | $ 1,715,690 | $ 989 | $ 1,574,769 | $ 4,592 | $ 134,748 | $ 1,182 | $ (590) | $ 1,138 | $ 1,716,828 | |
Balance (in shares) at Sep. 30, 2015 | 98,893,000 | 30,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | |
Mar. 31, 2015 | Jun. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | |
Operating Activities | ||||
Net income | $ 191,357 | $ 79,092 | ||
Adjustments to reconcile net income to net cash used in operating activities: | ||||
Provision for loan losses | 8,438 | 12,808 | ||
Depreciation, amortization and accretion, net | (67,557) | (63,367) | ||
Net realized gains on securities | (4,403) | |||
Bargain purchase gain | (81,289) | |||
Deferred income taxes | 11,459 | 6,418 | ||
Other, net | (91) | 16,669 | ||
Net change in securities purchased under agreements to resell | (39,148) | |||
Net change in assets segregated for regulatory purposes | 29,372 | (29,503) | ||
Net change in trading securities | 39,367 | (7,256) | ||
Net change in broker-dealer and clearing organization receivables | $ (793,613) | $ (660,121) | (680,699) | (164,497) |
Net change in FDIC Indemnification Asset | 38,561 | 41,175 | ||
Net change in other assets | (90,417) | (51,865) | ||
Net change in broker-dealer and clearing organization payables | 690,552 | 672,259 | 708,838 | 261,206 |
Net change in other liabilities | 3,138 | 30,303 | ||
Net gains from sales of loans | (405,023) | (293,786) | ||
Loans originated for sale | (10,628,783) | (7,954,706) | ||
Proceeds from loans sold | 10,965,234 | 8,067,301 | ||
Net cash provided by (used in) operating activities | (118,644) | (53,338) | (1,646) | (50,008) |
Investing Activities | ||||
Proceeds from maturities and principal reductions of securities held to maturity | 51,838 | 2,821 | ||
Proceeds from sales, maturities and principal reductions of securities available for sale | 599,737 | 152,537 | ||
Purchases of securities held to maturity | (167,284) | (123,021) | ||
Purchases of securities available for sale | (22,769) | (48,730) | ||
Net change in loans | (2,080) | (24,674) | 16,205 | 106,335 |
Purchases of premises and equipment and other assets | (23,410) | (32,581) | ||
Proceeds from sales of premises and equipment and other real estate owned | 94,680 | 55,097 | ||
Proceeds from redemption of bank owned life insurance | 822 | |||
Net cash paid or Federal Home Loan Bank and Federal Reserve Bank stock | (9,292) | (28,383) | ||
Net cash from acquisition | 41,097 | |||
Net cash provided by investing activities | 522,912 | 467,936 | 581,624 | 84,075 |
Financing Activities | ||||
Net change in deposits | (556,657) | (774,068) | (788,907) | (633,685) |
Net change in short-term borrowings | (16,446) | 503,897 | ||
Proceeds from notes payable | 150,078 | 2,000 | ||
Payments on notes payable | (37,787) | (2,643) | ||
Redemption of preferred stock | (114,068) | |||
Payments to repurchase common stock | (30,028) | |||
Dividends paid on preferred stock | (3,280) | (4,194) | ||
Net cash distributed to noncontrolling interest | (760) | (595) | ||
Other, net | (302) | 2,718 | ||
Net cash used in financing activities | (508,810) | (621,816) | (841,500) | (132,502) |
Net change in cash and cash equivalents | (104,542) | (207,218) | (261,522) | (98,435) |
Cash and cash equivalents, beginning of period | $ 813,075 | $ 813,075 | 813,075 | 746,023 |
Cash and cash equivalents, end of period | 551,553 | 647,588 | ||
Supplemental Disclosures of Cash Flow Information | ||||
Cash paid for interest | 41,368 | 20,935 | ||
Cash paid for income taxes, net of refunds | 112,282 | 19,893 | ||
Supplemental Schedule of Non-Cash Activities | ||||
Conversion of loans to other real estate owned | $ 45,996 | $ 44,815 | ||
Common stock issued at acquisition | 200,626 |
Summary of Significant Accounti
Summary of Significant Accounting and Reporting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Summary of Significant Accounting and Reporting Policies | |
Summary of Significant Accounting and Reporting Policies | 1. Summary of Significant Accounting and Reporting Policies Nature of Operations Hilltop Holdings Inc. (“Hilltop” and, collectively with its subsidiaries, the “Company”) is a financial holding company registered under the Bank Holding Company Act of 1956, as amended by the Gramm-Leach-Bliley Act of 1999. The Company’s primary line of business is to provide business and consumer banking services from offices located throughout Texas through PlainsCapital Bank (the “Bank”). In addition, the Company provides an array of financial products and services through its broker-dealer, mortgage origination and insurance subsidiaries. The Company provides its products and services through three primary operating subsidiaries, PlainsCapital Corporation (“PlainsCapital”), Hilltop Securities Holdings LLC (“Securities Holdings ”) and National Lloyds Corporation (“NLC”). PlainsCapital is a financial holding company, headquartered in Dallas, Texas, that provides, through its subsidiaries, traditional banking services, wealth and investment management and treasury management primarily in Texas and residential mortgage lending throughout the United States. Securities Holdings is a holding company, headquartered in Dallas, Texas, that provides, through its subsidiaries, investment banking and other related financial services, including municipal advisory, sales, trading and underwriting of taxable and tax-exempt fixed income securities, equity trading, clearing, securities lending, structured finance and retail brokerage services throughout the United States. NLC is a property and casualty insurance holding company, headquartered in Waco, Texas, that provides, through its subsidiaries, fire and homeowners insurance to low value dwellings and manufactured homes primarily in Texas and other areas of the southern United States. On January 1, 2015, Hilltop completed its acquisition of SWS Group, Inc. (“SWS”) in a stock and cash transaction (the "SWS Merger"), whereby SWS’s broker-dealer subsidiaries, Southwest Securities , Inc. and SWS Financial Services, Inc., became subsidiaries of Securities Holdings, a wholly owned subsidiary of Hilltop initially formed for the purpose of facilitating this transaction , and SWS’s banking subsidiary, Southwest Securities, FSB (“SWS FSB”), was merged into the Bank, an indirect wholly owned subsidiary of Hilltop. As a result of the SWS Merger, each outstanding share of SWS common stock was converted into the right to receive 0.2496 shares of Hilltop common stock and $1.94 in cash, equating to $6.92 per share based on Hilltop’s closing price on December 31, 2014 and resulting in an aggregate purchase price of $349.1 million, consisting of 10.1 million shares of common stock, $78.2 million in cash and $70.3 million associated with Hilltop’s existing investment in SWS common stock. Additionally, due to appraisal rights proceedings filed in connection with the SWS Merger, the merger consideration is subject to change, and is therefore, preliminary as of the date of this report. Based on purchase date valuations, the fair value of the assets acquired was $3.3 billion, including $707.5 million in securities , $863.8 million in non-covered loans and $1.2 billion in broker-dealer and clearing organization receivables. The fair value of liabilities assumed was $2.9 billion, consisting primarily of deposits of $1.3 billion and $1.1 billion in broker-dealer and clearing organization payabl es. On October 5, 2015, Southwest Securities , Inc. and SWS Financial Services, Inc. w ere renamed “ Hilltop Securities Inc. ” (“Hilltop Securities”) and “ Hilltop Securities Independent Network Inc. ” (“HTS Independent Network”) , respectively. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”), and in conformity with the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of management, these financial statements contain all adjustments necessary for a fair statement of the results of the interim periods presented. Accordingly, the financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (“ 2014 Form 10-K”). Results for interim periods are not necessarily indicative of results to be expected for a full year or any future period. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates regarding the allowance for loan losses, the fair values of financial instruments, the amounts receivable from the Federal Deposit Insurance Corporation (the “FDIC”) under loss-share agreements (the “FDIC Indemnification Asset”), reserves for losses and loss adjustment expenses, the mortgage loan indemnification liability, and the potential impairment of assets are particularly subject to change. The Company has applied its critical accounting policies and estimation methods consistently in all periods presented in these consolidated financial statements. The operations of SWS were included in the Company’s operating results beginning January 1, 2015 and such operations included a preliminary bargain purchase gain of $82.8 million as disclosed in the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 6, 2015. I n accordance with the Business Combinations Topic of the Accounting Standards Codification (“ASC”) , d uring the quarter ended June 30, 2015, the estimated fair value of the customer relationship intangible asset acquired as of January 1, 2015 was adjusted downward as a result of management’s review and approval of certain key assumptions that existed as of January 1, 2 015. Additionally, during the quarter ended September 30, 2015, the estimated fair value of deferred tax assets acquired as of January 1, 2015 was adjusted upward as a result of management’s review and filing of SWS’s consolidated federal tax return for the year ended December 31, 2014. These adjustments resulted in a net decrease in the preliminary bargain purchase gain associated with the SWS Merger to $81.3 million. This change is reflected in the consolidated statements of operations within noninterest income during the nine months ended September 30, 2015 . In the aggregate, t he se adjustment s to the preliminary bargain purchase gain decreased net income for the three months ended March 31, 2015 by $1.5 million as compared with amounts previously reported in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015. Additionally, certain amounts previously reported in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 within the consolidated balance sheet as of March 31, 2015, and the related statement s of comprehensive income, stockholders’ equity and cash flows for the three months ended March 31, 2015, as well as the notes to the consolidated financial statements, will be revised in future filings. Certain reclassifications have been made to the prior period consolidated financial statements to conform with the current period presentation. Additionally, d uring the preparation of the condensed consolidated financial statements for the period ended September 30, 2015, the Company determined that its previously reported unaudited consolidated statements of cash flows contained in the previously filed Quarterly Reports on Form 10-Q filed with SEC on May 6, 2015 and July 29, 2015 contained a classification error related to how certain acquired balances related to its acquisition of SWS were reflected . Management has evaluated the quantitative and qualitative impact of the classification error to previously issued unaudited consolidated statements of cash flows and concluded that the previously issued condensed consolidated financial statements were not materially misstated. H owever, in order to correctly present the cash flow statements, management has elected to revise the unaudited consolidated statements of cash flows for each of the three months ended March 31, 2015 and six months ended June 30, 2015 in its future filings. The correction had no impact on the Company’s financial condition or results of operations for the periods presented. The following table summarizes the revisions made to the Company’s unaudited consolidated statements of cash flows for the noted periods (in thousands) . Three Months Ended March 31, 2015 Six Months Ended June 30,2015 As Originally Reported As Revised As Originally Reported As Revised Operating Activities Net change in broker-dealer and clearing organization receivables $ $ $ $ Net change in broker-dealer and clearing organization payables Net cash provided by (used in) operating activities Investing Activities Net change in loans Net cash provided by investing activities Financing Activities Net change in deposits Net cash used in financing activities Net change in cash and cash equivalents Hilltop owns 100% of the outstanding stock of PlainsCapital. PlainsCapital owns 100% of the outstanding stock of the Bank and 100% of the membership interest in PlainsCapital Equity, LLC. The Bank owns 100% of the outstanding stock of PrimeLending, a PlainsCapital Company (“PrimeLending”) and has a 100% membership interest in PlainsCapital Securities, LLC. PrimeLending owns a 100% membership interest in PrimeLending Ventures Management, LLC, the controlling and sole managing member of PrimeLending Ventures, LLC (“Ventures”). Hilltop has a 100% membership interest in Securities Holdings , which operates through its wholly-owned subsidiaries, First Southwest Holdings, LLC (“First Southwest ”), Hilltop Securities and HTS Independent Network . T he principal subsidiaries of First Southwest are First Southwest Company, LLC (“FSC”), a broker-dealer registered with the SEC and the Financial Industry Regulatory Authority (“FINRA”) and a member of the New York Stock Exchange (“NYSE”), and First Southwest Asset Management, LLC, a registered investment advisor under the Investment Advisors Act of 1 940. Hilltop Securities is a broker-dealer registered with the SEC and FINRA and a member of the NYSE, and HTS Independent Network is an introducing broker-dealer that is also registered with the SEC and FINRA. Hilltop also owns 100% of NLC, which operates through its wholly owned subsidiaries, National Lloyds Insurance Company (“NLIC”) and American Summit Insurance Company (“ASIC”). The consolidated financial statements include the accounts of the above-named entities. All significant intercompany transactions and balances have been eliminated. Noncontrolling interests have been recorded for minority ownership in entities that are not wholly owned and are presented in compliance with the provisions of Noncontrolling Interest in Subsidiary Subsections of the Financial Accounting Standards Board (“FASB”) ASC. PlainsCapital also owns 100% of the outstanding common securities of PCC Statutory Trusts I, II, III and IV (the “Trusts”), which are not included in the consolidated financial statements under the requirements of the Variable Interest Entities Subsections of the ASC, because the primary beneficiaries of the Trusts are not within the consolidated group. |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2015 | |
Acquisition | |
Acquisition | 2. Acquisition SWS Merger On January 1, 2015, Hilltop completed its acquisition of SWS in a stock and cash transaction as discussed in Note 1 to the consolidated financial statements. The operations of SWS are included in the Company’s operating results beginning January 1, 2015. Such operating results include a preliminary bargain purchase gain of $81.3 million and are not necessarily indicative of future operating results. SWS’s results of operations prior to the acquisition date are not included in the Company’s consolidated operating results. The SWS Merger was accounted for using the acquisition method of accounting, and accordingly, purchased assets, including identifiable intangible assets, and assumed liabilities were recorded at their respective acquisition date fair values. The components of the consideration paid are shown in the following table (in thousands). Fair value of preliminary consideration paid: Common stock issued $ Cash Fair value of Hilltop’s existing investment in SWS Total preliminary consideration paid $ The resulting fair values of the identifiable assets acquired, and liabilities assumed, of SWS at January 1, 2015 are summarized in the following table (in thousands). Cash and due from banks $ Federal funds sold and securities purchased under agreements to resell Assets segregated for regulatory purposes Securities Non-covered loans, net Broker-dealer and clearing organization receivables Other assets Total identifiable assets acquired Deposits Broker-dealer and clearing organization payables Short-term borrowings Securities sold, not yet purchased, at fair value Notes payable Other liabilities Total liabilities assumed Preliminary estimated bargain purchase gain Less Hilltop existing investment in SWS Net identifiable assets acquired $ The preliminary bargain purchase gain represents the excess of the estimated fair value of the underlying net tangible assets and intangible assets over the preliminary merger consideration. The SWS Merger was a tax-free reorganization under Section 368(a) of the Internal Revenue Code, therefore no income taxes were recorded in connection with the preliminary bargain purchase gain. The Company used significant estimates and assumptions to value certain identifiable assets acquired and liabilities assumed. The preliminary bargain purchase gain was primarily driven by the Company’s ability to realize acquired deferred tax assets through its consolidated core earnings and the decline in the price of the Company’s common stock between the date the fixed conversion ratio was agreed upon and the closing date. Included within the fair value of other assets in the table above are identifiable intangible assets recorded in connection with the SWS Merger. The allocation to intangible assets is as follows (in thousands). Estimated Useful Gross Intangible Life (Years) Assets Customer relationships $ Core deposits $ T ra nsaction and integration - related expenses associated with the SWS Merger of $2.8 million and $0.3 million during the three months ended September 30, 2015 and 2014 , respectively, and $17.2 million and $0.7 million during the nine months ended September 30, 2015 and 2014 , respectively, are included in noninterest expense within the consolidated statements of operations. Such expenses were for professional services and other incremental employee and contractual costs associated with the integration of SWS’s operations. In connection with the SWS Merger, Hilltop acquired loans both with and without evidence of credit quality deterioration since origination. The acquired loans were initially recorded at fair value with no carryover of any allowance for loan losses. Acquired loans were segregated between those considered to be purchased credit impaired (“PCI”) loans and those without credit impairment at acquisition. The following table presents details on acquired loans at the acquisition date (in thousands). Loans, excluding PCI Total PCI Loans Loans Loans Commercial and industrial (1) $ $ $ Real estate Construction and land development Consumer — Total $ $ $ (1) Acquired loans include margin loans to customers and correspondents of $269.4 million associated with acquired broker-dealer operations, none of which are PCI loans. The following table presents information about the PCI loans at acquisition (in thousands). Contractually required principal and interest payments $ Nonaccretable difference Cash flows expected to be collected Accretable difference Fair value of loans acquired with a deterioration of credit quality $ The following table presents information about the acquired loans without credit impairment at acquisition (in thousands). Contractually required principal and interest payments $ Contractual cash flows not expected to be collected Fair value at acquisition Pro Forma Results of Operations The results of operations acquired in the SWS Merger have been included in the Company’s consolidated financial results since January 1, 2015. The following table discloses the impact of SWS on the Company’s results of operations. The table presents pro forma results had the SWS Merger taken place on January 1, 2014 and includes the estimated impact of purchase accounting adjustments (in thousands). The purchase accounting adjustments reflect the impact of recording the acquired loans at fair value, including the estimated accretion of the purchase discount on the loan portfolio. Accretion estimates were based on the acquisition date purchase discount on the loan portfolio, as it was not practicable to determine the amount of discount that would have been recorded based on economic conditions that existed on January 1, 2014. The pro forma results do not include any potential operating cost savings as a result of the SWS Merger. Further, certain costs associated with any integration activities are not reflected in the pro forma results. Pro forma results exclude nonrecurring items resulting directly from the SWS Merger that do not have a continuing impact on results of operations. The pro forma results are not necessarily indicative of what would have occurred had the SWS Merger taken place on the indicated date. Three Months Ended Nine Months Ended September 30, 2014 September 30, 2014 Net interest income $ $ Other revenues Net income |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements | |
Fair Value Measurements | 3. Fair Value Measurements Fair Value Measurements and Disclosures The Company determines fair values in compliance with The Fair Value Measurements and Disclosures Topic of the ASC (the “Fair Value Topic”). The Fair Value Topic defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. The Fair Value Topic defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Fair Value Topic assumes that transactions upon which fair value measurements are based occur in the principal market for the asset or liability being measured. Further, fair value measurements made under the Fair Value Topic exclude transaction costs and are not the result of forced transactions. The Fair Value Topic creates a fair value hierarchy that classifies fair value measurements based upon the inputs used in valuing the assets or liabilities that are the subject of fair value measurements. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs, as indicated below. · Level 1 Inputs : Unadjusted quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date. · Level 2 Inputs : Observable inputs other than Level 1 prices. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, yield curves, prepayment speeds, default rates, credit risks and loss severities), and inputs that are derived from or corroborated by market data, among others. · Level 3 Inputs : Unobservable inputs that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities. Level 3 inputs include pricing models and discounted cash flow techniques, among others . Fair Value Option The Company has elected to measure substantially all of PrimeLending’s mortgage loans held for sale and retained mortgage servicing rights (“MSR”) asset at fair value, under the provisions of the Fair Value Option. The Company elected to apply the provisions of the Fair Value Option to these items so that it would have the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. At September 30, 2015 , the aggregate fair value of PrimeLending’s mortgage loans held for sale accounted for under the Fair Value Option was $1.31 billion, and the unpaid principal balance of those loans was $1.25 billion. At December 31, 2014 , the aggregate fair value of PrimeLending’s mortgage loans held for sale accounted for under the Fair Value Option was $1.27 billion, and the unpaid principal balance of those loans was $1.22 billion. The interest component of fair value is reported as interest income on loans in the accompanying consolidated statements of operations. On October 2, 2014, Hilltop exercised its warrant to purchase 8,695,652 shares of SWS common stock at an exercise price of $5.75 per share (the “SWS Warrant”) and paid the aggregate exercise price by the automatic elimination of the $50.0 million aggregate principal amount note due to Hilltop under its credit agreement with SWS. Following the exercise of the SWS Warrant, Hilltop owned approximately 21% of the outstanding shares of SWS common stock as of October 2, 2014. Contemporaneous with the exercise of the SWS Warrant, Hilltop changed the accounting method for its investment in SWS common stock and elected to account for its investment in accordance with the provisions of the Fair Value Option as permitted by GAAP. Hilltop had previously accounted for its investment in SWS common stock as an available for sale security. Under the Fair Value Option, Hilltop’s investment in SWS common stock is recorded at fair value effective October 2, 2014, with changes in fair value being recorded in other noninterest income within the consolidated statements of operations rather than as a component of other comprehensive income. At December 31, 2014 , the fair value of Hilltop’s investment in SWS common stock was $70.3 million and is included in other assets within the consolidated balance sheet. The Company holds a number of financial instruments that are measured at fair value on a recurring basis, either by the application of the Fair Value Option or other authoritative pronouncements. The fair values of those instruments are determined primarily using Level 2 inputs. Those inputs include quotes from mortgage loan investors and derivatives dealers and data from independent pricing services. The following tables present information regarding financial assets and liabilities measured at fair value on a recurring basis (in thousands). Level 1 Level 2 Level 3 Total September 30, 2015 Inputs Inputs Inputs Fair Value Trading securities $ $ $ $ Available for sale securities — Loans held for sale — Derivative assets — — MSR asset — — Trading liabilities — Derivative liabilities — — Level 1 Level 2 Level 3 Total December 31, 2014 Inputs Inputs Inputs Fair Value Trading securities $ $ $ — $ Available for sale securities — Loans held for sale — Derivative assets — — MSR asset — — Investment in SWS common stock — — Trading liabilities — — Derivative liabilities — — The following tables include a rollforward for those financial instruments measured at fair value using Level 3 inputs (in thousands). Total Gains or Losses (Realized or Unrealized) Balance at Included in Other Beginning of Purchases/ Sales/ Included in Comprehensive Balance at Period Additions Reductions Net Income Income (Loss) End of Period Three months ended September 30, 2015 Trading securities $ $ — $ — $ $ — $ Loans held for sale — MSR asset — — Total $ $ $ $ $ — $ Nine months ended September 30, 2015 Trading securities $ — $ $ $ $ — $ Loans held for sale — MSR asset — — Total $ $ $ $ $ — $ Three months ended September 30, 2014 Available for sale securities $ $ — $ — $ $ $ Loans held for sale — MSR asset — Derivative liabilities — — Total $ $ $ $ $ $ Nine months ended September 30, 2014 Available for sale securities $ $ — $ — $ $ $ Loans held for sale — MSR asset — Derivative liabilities — — Total $ $ $ $ $ $ All net realized and unrealized gains (losses) in the table above are reflected in the accompanying consolidated financial statements. The available for sale securities noted in the table above reflect Hilltop’s note receivable from SWS and the SWS Warrant , which , as previously discussed, Hilltop exercised in full on October 2, 2014. Hilltop paid the aggregate exercise price for the SWS Warrant by the automatic elimination of the $50.0 million aggregate principal amount note due to Hilltop under the credit agreement. For Level 3 financial instruments measured at fair value on a recurring basis at September 30, 2015 , the significant unobservable inputs used in the fair value measurements were as follows. Range Financial instrument Valuation Technique Unobservable Input (Weighted-Average) Trading securities Discounted cash flow Discount rate 8 - 17 % ( 10 %) Loans held for sale Discounted cash flow / Market comparable Projected price 93 - 95 % ( 94 %) MSR asset Discounted cash flow Constant prepayment rate % Discount rate % The fair value of certain loans held for sale that cannot be sold through normal sale channels or are non-performing is measured using unobservable inputs. The fair value of such loans is generally based upon estimates of expected cash flows using unobservable inputs , including listing prices of comparable assets, uncorroborated expert opinions, and/or management’s knowledge of underlying collateral. Trading securities include corporate debt securities that are valued using a discounted cash flow model with observable market data; however, due to the distressed nature of these bonds, the Company has determined that these securities should be valued as a Level 3 financial instrument. The MSR asset, which is included in other assets within the Company’s consolidated balance sheets, is valued by projecting net servicing cash flows, which are then discounted to estimate the fair value. The fair value of the MSR asset is impacted by a variety of factors. Prepayment rates and discount rates, the most significant unobservable inputs, are discussed further in Note 7 to the consolidated financial statements. The Company had no transfers between Levels 1 and 2 during the periods presented. The following table presents the changes in fair value for instruments that are reported at fair value under the Fair Value Option (in thousands). Three Months Ended September 30, 2015 Three Months Ended September 30, 2014 Other Total Other Total Net Noninterest Changes in Net Noninterest Changes in Gains (Losses) Income Fair Value Gains (Losses) Income Fair Value Loans held for sale $ $ — $ $ $ — $ MSR asset — — Nine Months Ended September 30, 2015 Nine Months Ended September 30, 2014 Other Total Other Total Net Noninterest Changes in Net Noninterest Changes in Gains (Losses) Income Fair Value Gains (Losses) Income Fair Value Loans held for sale $ $ — $ $ $ — $ MSR asset — — The Company also determines the fair value of certain assets and liabilities on a non-recurring basis. In particular, the fair value of all of the assets acquired and liabilities assumed in the SWS Merger was determined at the acquisition date. In addition, facts and circumstances may dictate a fair value measurement when there is evidence of impairment. Assets and liabilities measured on a non-recurring basis include the items discussed below. Impaired Loans — The Company reports impaired loans based on the underlying fair value of the collateral through specific allowances within the allowance for loan losses. PCI loans with a fair value of $172.9 million, $822.8 million and $73.5 million were acquired by the Company upon completion of the merger with PlainsCapital (the “PlainsCapital Merger”), the FDIC-assisted transaction (the “FNB Transaction”) whereby the Bank acquired certain assets and assumed certain liabilities of First National Bank (“FNB”) and the SWS Merger, respectively (collectively, the “Bank Transactions”). Substantially all PCI loans acquired in the FNB Transaction are covered by FDIC loss-share agreements. The fair value of PCI loans was determined using Level 3 inputs, including estimates of expected cash flows that incorporated significant unobservable inputs regarding default rates, loss severity rates assuming default, prepayment speeds on acquired loans accounted for in pools (“Pooled Loans”), and estimated collateral values. At September 30, 2015 , estimates for these significant unobservable inputs were as follows. PCI Loans PlainsCapital FNB SWS Merger Transaction Merger Weighted average default rate % % % Weighted average loss severity rate % % % Weighted average prepayment speed % % % At September 30, 2015 , the resulting weighted average expected loss on PCI loans associated with the PlainsCapital Merger, FNB Transaction and SWS Merger was 28% , 21% and 20% , respectively. The Company obtains updated appraisals of the fair value o f collateral securing impaired collateral dependent loans at least annually, in accordance with regulatory guidelines. The Company also reviews the fair value of such collateral on a quarterly basis. If the quarterly review indicates that the fair value of the collateral may have deteriorated, the Company orders an updated appraisal of the fair value of the collateral. Because the Company obtains updated appraisals when evidence of a decline in the fair value of collateral exists, it typically does not adjust appraised values. Other Real Estate Owned — The Company reports other real estate owned (“OREO”) at fair value less estimated cost to sell. Any excess of recorded investment over fair value, less cost to sell, is charged against either the allowance for loan losses or the related PCI pool discount when property is initially transferred to OREO. Subsequent to the initial transfer to OREO, downward valuation adjustments are charged against earnings. The Company determines fair value primarily using independent appraisals of OREO properties. The resulting fair value measurements are classified as Level 2 or Level 3 inputs, depending upon the extent to which unobservable inputs determine the fair value measurement. The Company considers a number of factors in determining the extent to which specific fair value measurements utilize unobservable inputs, including, but not limited to, the inherent subjectivity in appraisals, the length of time elapsed since the receipt of independent market price or appraised value, and current market conditions. At September 30, 2015 , the most significant unobservable input used in the determination of fair value of OREO was a discount to independent appraisals for estimated holding periods of OREO properties. Such discount was 1% per month for estimated holding periods of 6 to 24 months. Level 3 inputs were used to determine the initial fa ir value at acquisition of a large group of smaller balance properties that were acquired in the FNB Transaction. In the FNB Transaction, the Bank acquired OREO of $135.2 million, all of which is covered by FDIC loss-share agreements. At September 30, 2015 and December 31, 2014 , the estimated fair value of covered OREO was $106.0 million and $136.9 million, respectively, and the underlying fair value measurements utilize Level 2 and Level 3 inputs. The fair value of non-covered OREO at September 30, 2015 and December 31, 2014 was $0.5 million and $0.8 million, respectively, and is included in other assets within the consolidated balance sheets. Level 3 inputs were used to determine the initial fair value at acquisition of properties totaling $5.6 million that were acquired in the SWS Merger. During the reported periods, all fair value measurements for non-covered OREO subsequent to initial recognition utilized Level 2 inputs. The following table presents information regarding certain assets and liabilities measured at fair value on a non-recurring basis for which a change in fair v alue has been recorded during reporting periods subsequent to initial recognition (in thousands). Total Gains (Losses) for the Total Gains (Losses) for the Level 1 Level 2 Level 3 Total Three Months Ended September 30, Nine Months Ended September 30, September 30, 2015 Inputs Inputs Inputs Fair Value 2015 2014 2015 2014 Non-covered impaired loans $ — $ — $ $ $ $ $ $ Covered impaired loans — — Non-covered other real estate owned — — — — — Covered other real estate owned — — The Fair Value of Financial Instruments Subsection of the ASC requires disclosure of the fair value of financial assets and liabilities, including the financial assets and liabilities previously discussed. The methods for determining estimated fair value for financial assets and liabilitie s is described in detail in Note 3 to the consolidated financial statements included in the Company’s 2014 Form 10-K. The following tables present the carrying values and estimated fair values of financial instruments not measured at fair value on either a recurring or non-recurring basis (in thousands). Estimated Fair Value Carrying Level 1 Level 2 Level 3 September 30, 2015 Amount Inputs Inputs Inputs Total Financial assets: Cash and cash equivalents $ $ $ — $ — $ Securities purchased under agreements to resell — — Held to maturity securities — — Loans held for sale — — Non-covered loans, net — Covered loans, net — — Broker-dealer and clearing organization receivables — — FDIC indemnification asset — — Other assets — Financial liabilities: Deposits — — Broker-dealer and clearing organization payables — — Short-term borrowings — — Debt — — Other liabilities — — Estimated Fair Value Carrying Level 1 Level 2 Level 3 December 31, 2014 Amount Inputs Inputs Inputs Total Financial assets: Cash and cash equivalents $ $ $ — $ — $ Held to maturity securities — — Loans held for sale — — Non-covered loans, net — Covered loans, net — — Broker-dealer and clearing organization receivables — — FDIC indemnification asset — — Other assets — Financial liabilities: Deposits — — Broker-dealer and clearing organization payables — — Short-term borrowings — — Debt — — Other liabilities — — |
Securities
Securities | 9 Months Ended |
Sep. 30, 2015 | |
Securities | |
Securities | 4. Securities The fair value of trading securities are summarized as follows (in thousands). September 30, December 31, 2015 2014 U.S. Treasury securities $ $ — U.S. government agencies: Bonds — Residential mortgage-backed securities Commercial mortgage-backed securities Collateralized mortgage obligations — Corporate debt securities States and political subdivisions Unit investment trusts — Private-label securitized product — Other Totals $ $ FSC, Hilltop Securities and HTS Independent Network (collectively, the “Hilltop Broker-Dealers”) enter into transactions that represent commitments to purchase and deliver securities at prevailing future market price s to facilitate customer transactions and satisfy such commitments . Accordingly, the Hilltop Broker-Dealers’ ultimate obligation may exceed the amount recognized in the financial statements. These securities, which are carried at fair value and reported as securities sold, not yet purchased in the consolidated balance sheet, had a value of $156.8 million at September 30, 2015 . The amortized cost and fair value of available for sale and held to maturity securities are summarized as follows (in thousands). Available for Sale Gross Gross Amortized Unrealized Unrealized September 30, 2015 Cost Gains Losses Fair Value U.S. Treasury securities $ $ $ $ U.S. government agencies: Bonds Residential mortgage-backed securities Commercial mortgage-backed securities Collateralized mortgage obligations Corporate debt securities States and political subdivisions Commercial mortgage-backed securities — Equity securities Totals $ $ $ $ Available for Sale Amortized Unrealized Unrealized December 31, 2014 Cost Gains Losses Fair Value U.S. Treasury securities $ $ $ $ U.S. government agencies: Bonds Residential mortgage-backed securities — Commercial mortgage-backed securities — Collateralized mortgage obligations Corporate debt securities States and political subdivisions Commercial mortgage-backed securities — Equity securities — Totals $ $ $ $ Held to Maturity Amortized Unrealized Unrealized September 30, 2015 Cost Gains Losses Fair Value U.S. Treasury securities $ $ $ — $ U.S. government agencies: Bonds — Residential mortgage-backed securities — Commercial mortgage-backed securities — Collateralized mortgage obligations States and political subdivisions Totals $ $ $ $ Held to Maturity Amortized Unrealized Unrealized December 31, 2014 Cost Gains Losses Fair Value U.S. Treasury securities $ $ — $ $ U.S. government agencies: Residential mortgage-backed securities — Collateralized mortgage obligations — States and political subdivisions Totals $ $ $ $ Information regarding available for sale and held to maturity securities that were in an unrealized loss position is shown in the following tables (dollars in thousands). September 30, 2015 December 31, 2014 Number of Unrealized Number of Unrealized Securities Fair Value Losses Securities Fair Value Losses Available for sale U.S. treasury securities: Unrealized loss for less than twelve months $ $ $ $ Unrealized loss for twelve months or longer — — — U.S. government agencies: Bonds: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer Residential mortgage-backed securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer — — — — — — — — — Commercial mortgage-backed securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer — Collateralized mortgage obligations: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer Corporate debt securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer States and political subdivisions: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer Equity securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer — — — — — — Total available for sale: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer $ $ $ $ September 30, 2015 December 31, 2014 Number of Unrealized Number of Unrealized Securities Fair Value Losses Securities Fair Value Losses Held to Maturity U.S. treasury securities: Unrealized loss for less than twelve months — $ — $ — $ $ Unrealized loss for twelve months or longer — — — — — — — — — U.S. government agencies: Collateralized mortgage obligations: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer — — — — — — States and political subdivisions: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer — — — — — — Total held to maturity: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer — — — — — — $ $ $ $ Duri ng the three and nine months ended September 30, 2015 and 2014 , the Company did not record any other-than-temporary impairments. While all of the investments are monitored for potential other-than-temporary impairment, the Company’s analysis and experience indicate that these available for sale investments generally do not present a significant risk of other-than-temporary-impairment, as fair values frequently recover over time. Factors considered in the Compan y’s analysis include the reasons for the unrealized loss position, the severity and duration of the unrealized loss position, credit worthiness, and forecasted performance of the investee. While some of the securities held in the investment portfolio have decreased in value since the date of acquisition, the severity of loss and the duration of the loss position are not believed to be significant enough to warrant other-than-temporary impairment of the securities. The Company does not intend, nor does the Company believe that is it likely that the Company will be required, to sell these securities before the recovery of the cost basis. Therefore, management does not believe any other-than-temporary impairments exist at September 30, 2015 . Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without penalties. The amortized cost and fair value of securities, excluding trading and available for sale equity securities, at September 30, 2015 are shown by contractual maturity below (in thousands). Available for Sale Held to Maturity Amortized Amortized Cost Fair Value Cost Fair Value Due in one year or less $ $ $ $ Due after one year through five years Due after five years through ten years Due after ten years Residential mortgage-backed securities Collateralized mortgage obligations Commercial mortgage-backed securities $ $ $ $ The Company realized net gains of $4.8 million and $0.2 million f rom its trading securities portfolio during the three months ended September 30, 2015 and 2014 , respectively, and net gains of $7.6 million and $1.6 million during the nine months ended September 30, 2015 and 2014 , respectively, which are recorded as a component of other noninterest income within the consolidated statements of operations. Securities with a carrying amount of $780.2 million and $895.5 million (with a fair value of $785.0 million and $890.3 million, respectively) at September 30, 2015 and December 31, 2014 , respectively, were pledged to secure public and trust deposits, federal funds purchased and securities sold under agreements to repurchase, and for other purposes as required or permitted by law. Mortgage-backed securities and collateralized mortgage obligations consist principally of Government National Mortgage Association (“GNMA”), Federal National Mortgage Association (“FNMA”) and Federal Home Loan Mortgage Corporation (“FHLMC”) pass-through and participation certificates. GNMA securities are guaranteed by the full faith and credit of the United States, while FNMA and FHLMC securities are fully guaranteed by those respective United States government-sponsored agencies, and conditionally guaranteed by the full faith and credit of the United States. At both September 30, 2015 and December 31, 2014 , NLC had investments on deposit in custody for various state insurance departments with carrying values of $9.2 million. |
Non-Covered Loans and Allowance
Non-Covered Loans and Allowance for Non-Covered Loan Losses | 9 Months Ended |
Sep. 30, 2015 | |
Non-Covered Loans and Allowance for Non-Covered Loan Loss | |
Non-Covered Loans and Allowance for Non-Covered Loan Losses | 5. Non-Covered Loans and Allowance for Non-Covered Loan Losses Non-covered loans refer to loans not covered by the FDIC loss-share agreements. Covered loans are discussed in Note 6 to the consolidated financial statements. Non-covered loans summarized by portfolio segment are as follows (in thousands). September 30, December 31, 2015 2014 Commercial and industrial (1) $ $ Real estate Construction and land development Consumer Allowance for non-covered loan losses Total non-covered loans, net of allowance $ $ (1) Includes margin loans to customers and correspondents of $606.0 million and $378.4 million at September 30, 2015 and December 31, 2014 , respectively. The Bank has lending policies in place with the goal of establishing an asset portfolio that will provide a return on stockholders’ equity sufficient to maintain capital to assets ratios that meet or exceed established regulations. Loans are underwritten with careful consideration of the borrower’s financial condition, the specific purpose of the loan, the primary sources of repayment and any collateral pledged to secure the loan. Underwriting procedures address financial components based on the size and complexity of the credit. The financial components include, but are not limited to, current and projected cash flows, shock analysis and/or stress testing, and trends in appropriate balance sheet and statement of operations ratios. The Bank’s loan policy provides specific underwriting guidelines by portfolio segment, including commercial and industrial, real estate, construction and land development, and consumer loans. The guidelines for each individual portfolio segment set forth permissible and impermissible loan types. With respect to each loan type, the guidelines within the Bank’s loan policy provide minimum requirements for the underwriting factors listed above. The Bank’s underwriting procedures also include an analysis of any collateral and guarantor. Collateral analysis includes a complete description of the collateral, as well as determined values, monitoring require ments, loan to value ratios, concentration risk, appraisal requirements and other information relevant to the collateral being pledged. Guarantor analysis includes liquidity and cash flow evaluation based on the significance with which the guarantors are expected to serve as secondary repayment sources. The Bank maintains a loan review department that reviews credit risk in response to both external and internal factors that potentially impact the perfo rmance of either individual loans or the overall loan portfolio. The loan review process reviews the creditworthiness of borrowers and determines compliance with the loan policy. The loan review process complements and reinforces the risk identification and assessment decisions made by lenders and credit personnel. Results of these reviews are presented to management and the Bank’s board of directors. In connection with the Bank Transactions, the Company acquired non-covered loans both with and without evidence of credit quality deterioration since origination. The following table presents the carrying values and the outstanding balances of the non-covered PCI loans (in thousands). September 30, December 31, 2015 2014 Carrying amount $ $ Outstanding balance Changes in the accretable yield for the non-covered PCI loans were as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions — — — Reclassifications from (to) nonaccretable difference, net (1) Disposals of loans — Accretion Balance, end of period $ $ $ $ (1) Reclassifications from nonaccretable difference are primarily due to net increases in expected cash flows in the quarterly recasts. Reclassifications to nonaccretable difference occur when accruing loans are moved to nonaccrual and expected cash flows are no longer predictable and the accretable yield is eliminated. The remaining nonaccretable difference for non-covered PCI loans was $31.1 million and $18.4 million at September 30, 2015 and December 31, 2014 , respectively. Impaired loans exhibit a clear indication that the borrower’s cash flow may not be sufficient to meet principal and interest payments, which is generally when a loan is 90 days past due unless the asset is both well secured and in the process of collection. Non-covered impaired loans include non-accrual loans, troubled debt restructurings (“TDRs”), PCI loans and partially charged-off loans. The amounts shown in following tables include loans accounted for on an individual basis, as well as Pooled Loans. For Pooled Loans, the recorded investment with allowance and the related allowance consider impairment measured at the pool level. Non-covered impaired loans are summarized by class in the following tables (in thousands). Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related September 30, 2015 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured — — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development Consumer $ $ $ $ $ Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related December 31, 2014 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — — — — Commercial construction loans and land development Consumer $ $ $ $ $ Average investment in non-covered impaired loans is summarized by class in the following table (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Commercial and industrial: Secured $ $ $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development Consumer $ $ $ $ Non-covered non-accrual loans, excluding those classified as held for sale, are summarized by class in the following table (in thousands). September 30, December 31, 2015 2014 Commercial and industrial: Secured $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development Consumer — $ $ At September 30, 2015 and December 31, 2014 , non-covered non-accrual loans included non-covered PCI loans of $9.6 million and $6.6 million, respectively, for which discount accretion has been suspended because the extent and timing of cash flows from these non-covered PCI loans can no longer be reasonably estimated. In addition to the non-covered non-accrual loans in the table above, $1.5 million and $3.0 million of real estate loans secured by residential properties and classified as held for sale were in non-accrual status at September 30, 2015 and December 31, 2014 , respectively. Interest income , including recoveries and cash payments , recorded on non-covered impaired loans was $4.9 million and $0.1 million during the three months ended September 30, 2015 and 2014 , respectively, and $7.4 million and $2.6 million during the nine months ended September 30, 2015 and 2014 , respectively. Except as noted above, non-covered PCI loans are considered to be performing due to the application of the accretion method. The Bank classifies loan modifications as TDRs when it concludes that it has both granted a concession to a debtor and that the debtor is experiencing financial difficulties. Loan modifications are typically structured to create affordable payments for the debtor and can be achieved in a variety of ways. The Bank modifies loans by reducing interest rates and/or lengthening loan amortization schedules. The Bank also reconfigures a single loan i nto two or more loans (“A/B Note”). The typical A/B Note restructure results in a “bad” loan which is charged off and a “good” loan or loans the terms of which comply with the Bank’s customary underwriting policies. The debt charged off on the “bad” loan is not forgiven to the debtor. The outstanding balance of TDRs granted in the three and nine months ended September 30, 2015 and the nine months ended September 30, 2014 is shown in the following tables (in thousands). There were no TDRs granted during the three months ended September 30, 2014 . The TDR gran ted during the three months ended March 31, 2015 was paid off as of June 30, 2015. At September 30, 2015, the Bank had nominal u nadvanced commitments to borrowers whose loans have been restructured in TDRs . At December 31, 2014 , the Bank had $0.5 million in unadvanced commitments to borrowers whose loans have been restructured in TDRs. Recorded Investment in Loans Modified by Interest Rate Payment Term Total Three months ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ $ Unsecured — — — — Real estate: Secured by commercial properties — — Secured by residential properties — — — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ — $ — $ $ Recorded Investment in Loans Modified by Interest Rate Payment Term Total Nine months ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ $ Unsecured — — — — Real estate: Secured by commercial properties — — Secured by residential properties — — — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ — $ — $ $ Recorded Investment in Loans Modified by Interest Rate Payment Term Total Nine months ended September 30, 2014 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ — $ — Unsecured — — — — Real estate: Secured by commercial properties — — Secured by residential properties — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — Consumer — — — — $ — $ — $ $ The following table presents information regarding TDRs granted in the three and nine months ended September 30, 2015 for which a payment was at least 30 days past due in the three and nine months ended September 30, 2015 (dollars in thousands). Number of Recorded Loans Investment Commercial and industrial: Secured — $ — Unsecured — — Real estate: Secured by commercial properties Secured by residential properties — — Construction and land development: Residential construction loans — — Commercial construction loans and land development — — Consumer — — $ An analysis of the aging of the Bank’s non-covered loan portfolio is shown in the following tables (in thousands). Accruing Loans (Non-PCI) Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total Past Due September 30, 2015 30-59 Days 60-89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ $ $ $ $ $ $ $ Unsecured — — Real estate: Secured by commercial properties — — — Secured by residential properties Construction and land development: Residential construction loans — — — — — Commercial construction loans and land development — — Consumer — — $ $ $ $ $ $ $ $ Accruing Loans (Non-PCI) Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total Past Due December 31, 2014 30-59 Days 60-89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ $ $ $ $ $ $ $ — Unsecured — — Real estate: Secured by commercial properties — — — Secured by residential properties — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — Consumer — — $ $ $ $ $ $ $ $ — In addition to the non-covered loans shown in the table above, $37.0 million and $19.2 million of loans included in loans held for sale (with an unpaid principal balance of $37.2 million and $19.2 million, respectively) were 90 days past due and accruing interest at September 30, 2015 and December 31, 2014 , respectively. These loans are guaranteed by U.S. government agencies and include loans that are subject to repurchase, or have been repurchased, by PrimeLending. Management tracks credit quality trends on a quarterly basis related to: (i) past due levels, (ii) non-performing asset levels, (iii) classified loan levels, (iv) net charge-offs, and (v) general economic conditions in the state and local markets. The Bank utilizes a risk grading matrix to assign a risk grade to each of the loans in its portfolio. A risk rating is assigned based on an assessment of the borrower’s management, collateral position, financial capacity, and economic factors. The general characteristics of the various risk grades are described below. Pass – “Pass” loans present a range of acceptable risks to the Bank. Loans that would be considered virtually risk-free are rated Pass – low risk. Loans that exhibit sound standards based on the grading factors above and present a reasonable risk to the Bank are rated Pass – normal risk. Loans that exhibit a minor weakness in one or more of the grading criteria but still present an acceptable risk to the Bank are rated Pass – high risk. Special Mention – “Special Mention” loans have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in a deterioration of the repayment prospects for the loans and weaken the Bank’s credit position at some future date. Special Mention loans are not adversely classified and do not expose the Bank to sufficient risk to require adverse classification. Substandard – “Substandard” loans are inadequately protected by the current sound worth and paying capacity of the obligor or the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Many substandard loans are considered impaired. PCI – “PCI” loans exhibited evidence of credit deterioration at acquisition that made it probable that all contractually required principal payments would not be collected. The following tables present the internal risk grades of non-covered loans, as previously described, in the portfolio by class (in thousands). September 30, 2015 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ $ $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties — Construction and land development: Residential construction loans — — Commercial construction loans and land development — Consumer — $ $ $ $ $ December 31, 2014 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ $ $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties — Construction and land development: Residential construction loans — — — Commercial construction loans and land development — Consumer — $ $ $ $ $ Allowance for Loan Losses The allowance for loan losses is a reserve established through a provision for loan losses charged to expense, which represents management’s best estimate of probable losses inherent in the existing portfolio of loans. It is management’s responsibility at the end of each quarter, or more frequently as deemed necessary, to analyze the level of the allowance for loan losses to ensure that it is appropriate for the estimated credit losses in the portfolio consistent with the Interagency Policy Statement on the Allowance for Loan and Lease Losses and the Receivables and Contingencies Topics of the ASC. Estimated credit losses are the probable current amount of loans that the Company will be unable to collect given facts and circumstances as of the evaluation date. When management determines that a loan or portion thereof is uncollectible, the loan, or portion thereof, is charged off against the allowance for loan losses, or for acquired loans accounted for in pools, charged against the pool discount. Recoveries on charge-offs of loans acquired in the Bank Transactions that occurred prior to their acquisition represent contractual cash flows not expected to be collected and are recorded as accretion income. Recoveries on acquired loans charged-off subsequent to their acquisition are credited to the allowance for loan loss, except for recoveries on loans accounted for in pools, which are credited to the pool discount. The Bank’s loan portfolio is designated into two populations: acquired loans and originated loans. The allowance for loan losses is calculated separately for acquired and originated loans. PCI loans acquired in the PlainsCapital Merger are accounted for on an individual loan basis, while PCI loans acquired in each of the FNB Transaction and the SWS Merger are accounted for both in pools and at the individual loan level. Cash flows expected to be collected are recast quarterly for each loan or pool. These evaluations require the continued use and updating of key assumptions and estimates such as default rates, loss severity given default and prepayment speed assumptions (similar to those used for the initial fair value estimate). Management judgment must be applied in developing these assumptions. If expected cash flows for a loan or pool decreases, an increase in the allowance for loan losses is made through a charge to the provision for loan losses. If expected cash flows for a loan or pool increase, any previously established allowance for loan losses is reversed and any remaining difference increases the accretable yield . This increase in accretable yield is taken into income over the remaining life of the loan. The allowance for both originated and acquired loans is subject to regulatory examinations and determinations as to appropriateness, which may take into account such factors as the methodology used to calculate the allowance and the size of the allowance. Changes in the allowance for non-covered loan losses, distributed by portfolio segment, are shown below (in thousands). Commercial and Construction and Three Months Ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to (recapture from) operations Loans charged off — Recoveries on charged off loans — Balance, end of period $ $ $ $ $ Commercial and Construction and Nine Months Ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to (recapture from) operations Loans charged off — Recoveries on charged off loans — Balance, end of period $ $ $ $ $ Commercial and Construction and Three Months Ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to operations Loans charged off — Recoveries on charged off loans Balance, end of period $ $ $ $ $ Commercial and Construction and Nine Months Ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to operations Loans charged off — Recoveries on charged off loans Balance, end of period $ $ $ $ $ The non-covered loan portfolio was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ $ — $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ $ $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ The allowance for non-covered loan losses was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ — $ — $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ — $ — $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ |
Covered Assets and Indemnificat
Covered Assets and Indemnification Asset | 9 Months Ended |
Sep. 30, 2015 | |
Covered Assets and Indemnification Asset | |
Covered Assets and Indemnification Asset. | 6. Covered Assets and Indemnification Asset On September 13, 2013, the Bank assumed substantially all of the liabilities, including all of the deposits, and acquired substantially all of the assets of FNB in an FDIC-assisted transaction. As part of the Purchase and Assumption Agreement by and among the FDIC (as receiver of FNB), the Bank and the FDIC (the “P&A Agreement”), the Bank and the FDIC entered into loss-share agreements covering future losses incurred on certain acquired loans and OREO. The Company refers to acquired commercial and single family residential loan portfolios and OREO that are subject to the loss-share agreements as “covered loans” and “covered OREO”, respectively, and these assets are presented as separate line items in the Company’s consolidated balance sheets. Collectively, covered loans and covered OREO are referred to as “covered assets”. Pursuant to the loss-share agreements, the FDIC has agreed to reimburse the Bank the following amounts with respect to the covered assets: (i) 80% of net losses on the first $240.4 million of net losses incurred; (ii) 0% of net losses in excess of $240.4 million up to and including $365.7 million of net losses incurred; and (iii) 80% of net losses in excess of $365.7 million of net losses incurred. Net losses are defined as b ook value losses plus certain defined expenses incurred in the resolution of assets, less subsequent recoveries. Under the loss-share agreement for commercial assets , the amount of subsequent recoveries that are reimbursable to the FDIC for a particular asset is limited to b ook value losses and expenses actually billed plus any b ook value charge-offs incurred prior to September 13, 2013 (the “Bank Closing Date”) . There is no limit on the amount of subsequent recoveries reimbursable to the FDIC under the loss-share agreement f or single family residential assets . The loss-share agreements for commercial and single family residential assets are in effect for 5 years and 10 years, respectively, from the Bank Closing Date, and the loss recovery provisions to the FDIC are in effect for 8 years and 10 years, respectively, from the Bank Closing Date. The asset arising from the loss-share agreements, referred to as the “FDIC Indemnification Asset,” is measured separately from the covered loan portfolio because the agreements are not contractually embedded in the covered loans and are not transferable should the Bank choose to dispose of the covered loans. In accordance with the loss-share agreements, the Bank may be required to make a “true-up” payment to the FDIC approximately 10 years following the Bank Closing Date if the FDIC’s initial estimate of losses on covered assets is greater than the actual realized losses. The “true-up” payment is calculated using a defined formula set forth in the P&A Agreement. Covered Loans and Allowance for Covered Loan Losses Loans acquired in the FNB Transaction that are subject to a loss-share agreement are referred to as “covered loans” and reported separately in the consolidated balance sheets. Covered loans are reported exclusive of the cash flow reimbursements that may be received from the FDIC. The Bank’s portfolio of acquired covered loans had a fair value of $1.1 billion as of the Bank Closing Date, with no carryover of any allowance for loan losses. Acquired covered loans were preliminarily segregated between those considered to be PCI loans and those without credit impairment at acquisition. In connection with the FNB Transaction, the Bank acquired loans both with and without evidence of credit quality deterioration since origination. The Company’s accounting policies for acquired covered loans, including covered PCI loans, are consistent with that of acquired non-covered loans, as described in Note 5 to the consolidated financial statements. The Company has established under its PCI accounting policy a framework to aggregate certain acquired covered loans into various loan pools based on a minimum of two layers of common risk characteristics for the purpose of determining their respective fair values as of their acquisition dates, and for applying the subsequent recognition and measurement provisions for income accretion and impairment testing. The following table presents the carrying value of the covered loans summarized by portfolio segment (in thousands). September 30, December 31, 2015 2014 Commercial and industrial $ $ Real estate Construction and land development Consumer — — Allowance for covered loans Total covered loans, net of allowance $ $ The following table presents the carrying value and the outstanding contractual balance of the covered PCI loans (in thousands). September 30, December 31, 2015 2014 Carrying amount $ $ Outstanding balance Changes in the accretable yield for the covered PCI loans were as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Reclassifications from (to) nonaccretable difference, net (1) Transfer of loans to covered OREO (2) Accretion Balance, end of period $ $ $ $ (1) Reclassifications from nonaccretable difference are primarily due to net increases in expected cash flows in the quarterly recasts , but may also include the reclassification and immediate income recognition of nonaccretable difference due to the favorable resolution of loans accounted for individually . Reclassifications to nonaccretable difference occur when accruing loans are moved to nonaccrual and expected cash flows are no longer predictable and the accretable yield is eliminated. (2) Transfer of loans to covered OREO is the difference between the value removed from the pool and the expected cash flows for the loan. The remaining nonaccretable difference for covered PCI loans was $191.9 million and $382.5 million at September 30, 2015 and December 31, 2014 , respectively. During the three and nine months ended September 30, 2015 and 2014 , a combination of factors affecting the inputs to the Bank’s quarterly recast process led to the reclassifications from nonaccretable difference to accretable yield. These transfers resulted from revised cash flows that reflect better-than-expected performance of the covered PCI loan portfolio as a result of the Bank’s strategic decision to dedicate resources to the liquidation of covered loans during the noted periods. Covered impaired loans include non-accrual loans, TDRs, PCI loans and partially charged-off loans. Substantially all covered impaired loans are PCI loans. The amounts shown in following tables include Pooled Loans, as well as loans accounted for on an individual basis. For Pooled Loans, the recorded investment with allowance and the related allowance consider impairment measured at the pool level. Covered impaired loans are summarized by class in the following tables (in thousands). Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related September 30, 2015 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured — — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development Consumer — — — — — $ $ $ $ $ Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related December 31, 2014 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development — — Consumer — — — — — $ $ $ $ $ Average investment in covered impaired loans is summarized by class in the following table (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Commercial and industrial: Secured $ $ $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development Consumer — — — — $ $ $ $ Covered non-accrual loans are summarized by class in the following table (in thousands). September 30, December 31, 2015 2014 Commercial and industrial: Secured $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development Consumer — — $ $ At December 31, 2014 , covered non-accrual loans included covered PCI l oans of $31.2 million, for which discount accretion has been suspended because the extent and timing of cash flows from these covered PCI loans can no longer be reasonably estimated. There were no covered non-accrual PCI loans at September 30, 2015 . Interest income, including recoveries and cash payments, recorded on covered impaired loans was $14.3 million during the three and nine months ended September 30, 2015, respecti vely. Interest income recorded on covered impaired loans during the three and nine months ended September 30, 2014 was nominal. Ex cept as noted above, covered PCI loans are considered to be performing due to the application of the accretion method. The Bank classifies loan modifications of covered loans as TDRs in a manner consistent with that of non-covered loans as discussed in Note 5 to the consolidated financial statements. The outstanding balance of TDRs granted in the three and nine months ended September 30, 2015 is shown in the following tables (in thousands). Pooled Loans are not in the scope of the disclosure requirements for TDRs. A TDR granted during the three months ended March 31, 2015 of $0.6 million, and for which a payment was at least 30 days past due in the three months ended June 30, 2 01 5, was paid off as of September 30, 2015. There were no TDRs granted during the period from September 14, 2013 through September 30, 2014. At September 30, 2015 , the Bank had nominal unadvanced commitments to borrowers whose loans have been restructured in TDRs. Recorded Investment in Loans Modified by Interest Rate Payment Term Total Three Months Ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ — $ — Unsecured — — — — Real estate: Secured by commercial properties — — — — Secured by residential properties — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ — $ $ — $ Recorded Investment in Loans Modified by Interest Rate Payment Term Total Nine Months Ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ — $ — Unsecured — — — — Real estate: Secured by commercial properties — — — — Secured by residential properties Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ $ $ $ The following table presents information regarding TDRs granted in the three and nine months ended September 30, 2015 for which a payment was at least 30 days past due in the three and nine months ended September 30, 2015 (dollars in thousands). Number of Recorded Loans Investment Commercial and industrial: Secured — $ — Unsecured — — Real estate: Secured by commercial properties — Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development — — Consumer — — $ An analysis of the aging of the Bank’s covered loan portfolio is shown in the following tables (in thousands). Accruing Loans Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total (Non ‑ PCI) Past Due September 30, 2015 30 ‑ 59 Days 60 ‑ 89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ $ — $ $ $ $ $ $ — Unsecured — — — — — — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — — Commercial construction loans and land development — Consumer — — — — — — — — $ $ $ $ $ $ $ $ Accruing Loans Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total (Non ‑ PCI) Past Due December 31, 2014 30 ‑ 59 Days 60 ‑ 89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ — $ — $ $ $ $ $ $ Unsecured — — — Real estate: Secured by commercial properties — — Secured by residential properties Construction and land development: Residential construction loans — — — Commercial construction loans and land development Consumer — — — — — — — — $ $ $ $ $ $ $ $ The Bank assigns a risk grade to each of its covered loans in a manner consistent with the existing loan review program and risk grading matrix used for non-covered loans, as described in Note 5 to the consolidated financial statements. The following tables present the internal risk grades of covered loans in the portfolio by class (in thousands). September 30, 2015 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ — $ $ $ Unsecured — — — Real estate: Secured by commercial properties — Secured by residential properties Construction and land development: Residential construction loans — Commercial construction loans and land development — Consumer — — — — — $ $ $ $ $ December 31, 2014 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ — $ $ $ Unsecured — — Real estate: Secured by commercial properties — Secured by residential properties — Construction and land development: Residential construction loans — Commercial construction loans and land development — Consumer — — — — — $ $ — $ $ $ The Bank’s impairment methodology for the covered loans is consistent with that of non-covered loans as discussed in Note 5 to the consolidated financial statements. To the extent there is experienced or projected credit deterioration on the acquired covered loan pools subsequent to amounts estimated at the previous quarterly recast date and expected cash flows for a loan or pool decreases, an increase in the allowance for loan losses is made through a charge to the provision for loan losses. If expected cash flows for a loan or pool increase, any previously established allowance for loan losses is reversed and any remaining difference increases the accretable yield . This increase in accretable yield i s taken into income over the remaining life of the loan. Additionally, provision for credit losses will be recorded on advances on covered loans subsequent to the acquisition date in a manner consistent with the allowance for non-covered loan losses. Changes in the allowance for covered loan losses, distributed by portfolio segment, are shown below (in thousands). Commercial and Construction and Three months ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ — $ Provision charged to (recapture from) operations — Loans charged off — — Recoveries on charged off loans — — Balance, end of period $ $ $ $ — $ Commercial and Construction and Nine months ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ — $ Provision charged to (recapture from) operations — Loans charged off — Recoveries on charged off loans — — Balance, end of period $ $ $ $ — $ Commercial and Construction and Three months ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ — $ Provision charged to (recapture from) operations — Loans charged off — — Recoveries on charged off loans — — — — — Balance, end of period $ $ $ $ — $ Commercial and Construction and Nine months ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ — $ — $ Provision charged to (recapture from) operations — Loans charged off — Recoveries on charged off loans — — — — — Balance, end of period $ $ $ $ — $ The covered loan portfolio was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ $ — $ Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ $ — $ Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ The allowance for covered loan losses was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ — $ — $ — Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ — $ — $ — Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ Covered Other Real Estate Owned A summary of the activity in covered OREO is as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions to covered OREO Dispositions of covered OREO Valuation adjustments in the period Balance, end of period $ $ $ $ During the three and nine months ended September 30, 2015 and 2014 , the Bank wrote down certain covered OREO assets to fair value to reflect new appraisals on certain OREO acquired in the FNB Transaction and OREO acquired from the foreclosure on certain FNB loans acquired in the FNB Transaction. Although the Bank recorded a fair value discount on the acquired assets upon acquisition, in some cases additional downward valuations were required. These additional downward valuation adjustments reflect changes to the assumptions regarding the fair value of the OREO, including in some cases the intended use of the OREO due to the availability of more information , as well as the passage of time. The process of determining fair value is subjective in nature and requires the use of significant estimates and assumptions. Although the Bank makes market-based assumptions when valuing acquired assets, new information may come to light that causes estimates to increase or decrease. When the Bank determines, based on subsequent information, that its estimates require adjustment, the Bank records the adjustment. The accounting for such adjustments requires that the decreases to fair value be recorded at the time such new information is received, while increases to fair value are recorded when the asset is subsequently sold. All of the impairments recorded during the three and nine months ended September 30, 2015 and 2014 r elated to covered assets subject to the loss-share agreements with the FDIC. FDIC Indemnification Asset A summary of the activity in the FDIC Indemnification Asset is as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ FDIC Indemnification Asset accretion (amortization) Transfers to due from FDIC and other Balance, end of period $ $ $ $ As of September 30, 2015 , the Bank had billed and collected $98.9 million from the FDIC, which represented reimbursable covered losses and expenses through June 30 , 2015. |
Mortgage Servicing Rights
Mortgage Servicing Rights | 9 Months Ended |
Sep. 30, 2015 | |
Mortgage Servicing Rights | |
Mortgage Servicing Rights | 7. Mortgage Servicing Rights The following tables present the changes in fair value of the Company’s MSR asset, as included in other assets within the consolidated balance sheets, and other information related to the serviced portfolio (dollars in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions Sales — — Changes in fair value: Due to changes in model inputs or assumptions (1) Due to customer payments Balance, end of period $ $ $ $ September 30, December 31, 2015 2014 Mortgage loans serviced for others $ $ MSR asset as a percentage of serviced mortgage loans % % (1) Primarily represents changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates and the refinement of other MSR model assumptions. The key assumptions used in measuring the fair value of the Company’s MSR asset were as follows. September 30, December 31, 2015 2014 Weighted average constant prepayment rate % % Weighted average discount rate % % Weighted average life (in years) A sensitivity analysis of the fair value of the Company’s MSR asset to certain key assumptions is presented in the following table (in thousands). September 30, December 31, 2015 2014 Constant prepayment rate: Impact of 10% adverse change $ $ Impact of 20% adverse change Discount rate: Impact of 10% adverse change Impact of 20% adverse change This sensitivity analysis presents the effect of hypothetical changes in key assumptions on the fair value of the MSR asset. The effect of such hypothetical change in assumptions generally cannot be extrapolated because the relationship of the change in one key assumption to the change in the fair value of the MSR asset is not linear. In addition, in the analysis, the impact of an adverse change in one key assumption is calculated independent of any impact on other assumptions. In reality, changes in one assumption may change another assumption. Contractually specified servicing fees, late fees and ancillary fees earned of $5.2 million and $3.1 million during the three months ended September 30, 2015 and 2014 , respectively, and $13.7 million and $8.1 million during the nine months ended September 30, 2015 and 2014 , respectively , were included in other noninterest income within the consolidated statements of operations. |
Deposits
Deposits | 9 Months Ended |
Sep. 30, 2015 | |
Deposits | |
Deposits | 8. Deposits Deposits are summarized as follows (in thousands). September 30, December 31, 2015 2014 Noninterest-bearing demand $ $ Interest-bearing: NOW accounts Money market Brokered - money market Demand Savings Time Brokered - time $ $ The significant increase in deposits at September 30, 2015 as compared to December 31, 2014 was primarily due to the inclusion of th e deposits assumed in the SWS Merger. |
Short-term Borrowings
Short-term Borrowings | 9 Months Ended |
Sep. 30, 2015 | |
Short-term Borrowings | |
Short-term Borrowings | 9. Short-term Borrowings Short-term borrowings are summarized as follows (in thousands). September 30, December 31, 2015 2014 Federal funds purchased $ $ Securities sold under agreements to repurchase Federal Home Loan Bank notes Short-term bank loans $ $ Federal funds purchased and securities sold under agreements to repurchase generally mature daily, on demand, or on some other short-term basis. The Bank and the Hilltop Broker-Dealers execute transactions to sell securities under agreements to repurchase with both customers and broker-dealers. Securities involved in these transactions are held by the Bank, the Hilltop Broker-Dealers or a third-party dealer. Information concerning federal funds purchased and securities sold under agreements to repurchase is shown in the following tables (dollars in thousands). Nine Months Ended September 30, 2015 2014 Average balance during the period $ $ Average interest rate during the period % % September 30, December 31, 2015 2014 Average interest rate at end of period % % Securities underlying the agreements at end of period: Carrying value $ $ Estimated fair value $ $ Federal Home Loan Bank (“FHLB”) short-term notes mature over terms not exceeding 365 days and are collateralized by FHLB Dallas stock, nonspecified real estate loans and certain specific commercial real estate loans . Other information regarding FHLB notes is shown in the following tables (dollars in thousands). Nine Months Ended September 30, 2015 2014 Average balance during the period $ $ Average interest rate during the period % % September 30, December 31, 2015 2014 Average interest rate at end of period % % The Hilltop Broker-Dealers use short-term bank loans periodically to finance securities owned, margin loans to customers and correspondents, and underwriting activities. Interest on the borrowings varies with the federal funds rate. The weighted average interest rate on the borrowings at September 30, 2015 and December 31, 2014 was 1.24% and 1.07% , respectively. |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2015 | |
Notes Payable | |
Notes Payable | 10. Notes Payable On April 9, 2015, Hilltop completed an offering of $150.0 million aggregate principal amount of its 5% senior notes due 2025 (“Senior Unregistered Notes”) in a private offering that was exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Senior Unregistered Notes were offered within the United States only to qualified institutional buyers pursuant to Rule 144A under the Securities Act, and to persons outside of the United States under Regulation S under the Securities Act. The Senior Unregistered Notes were issued pursuant to an indenture, dated as of April 9, 2015, by and between Hilltop and U.S. Bank National Association, as trustee. The net proceeds from the offering, after deducting estimated fees and expenses and the initial purchasers’ discounts, were approximately $148 million. Hilltop used the net proceeds of the offering to redeem all of Hilltop’s outstanding Non-Cumulative Perpetual Preferred Stock, Series B at an aggregate liquidation value of $114.1 million, plus accrued but unpaid dividends of $0.4 million , and Hilltop is utilizing the remainder for general corporate purposes. In connection with the issuance of the Senior Unregistered Notes, on April 9, 2015, the Company entered into a registration rights agreement with the initial purchasers of the Senior Unregistered Notes. Under the terms of the registration rights agreement, the Company agreed to offer to exchange the Senior Unregistered Notes for notes registered under the Securities Act (the “Senior Registered Notes”). The terms of the Senior Registered Notes are substantially identical to the Senior Unregistered Notes for which they were exchanged (including principal amount, interest rate, maturity and redemption rights), except that the Senior Registered Notes generally are not subject to transfer restrictions. On May 22, 2015 and subject to the terms and conditions set forth in the Senior Registered Notes prospectus, the Company commenced an offer to exchange the Senior Unregistered Notes for Senior Registered Notes. Substantially all of the Senior Unregistered Notes were tendered in the exchange offer, and on June 22, 2015, the Company fulfilled its requirements under the registration rights agreement for the Senior Unregistered Notes by issuing Senior Registered Notes in exchange for the tendered Senior Unregistered Notes. The Senior Registered Notes and the Senior Unregistered Notes that remain outstanding are collectively referred to as the “Senior Notes.” The Senior Notes bear interest at a rate of 5% per year, payable semi-annually in arrears in cash on April 15 and October 15 of each year, commencing on October 15, 2015. The Senior Notes will mature on April 15, 2025, unless Hilltop redeems the Senior Notes, in whole at any time or in part from time to time, on or after January 15, 2025 ( three months prior to the maturity date of the Senior Notes) at its election at a redemption price equal to 100% of the principal amount of the Senior Notes to be redeemed plus accrued and unpaid interest to, but excluding, the redemption date. The indenture contains covenants that limit the Company’s ability to, among other things and subject to certain significant exceptions: (i) dispose of or issue voting stock of certain of the Company’s bank subsidiaries or subsidiaries that own voting stock of our bank subsidiaries, (ii) incur or permit to exist any mortgage, pledge, encumbrance or lien or charge on the capital stock of certain of the Company’s bank subsidiaries or subsidiaries that own capital stock of the Company’s bank subsidiaries and (iii) sell all or substantially all of the Company’s assets or merge or consolidate with or into other companies. The indenture also provides for certain events of default, which, if any of them occurs, would permit or require the principal amount, premium, if any, and accrued and unpaid interest on the then outstanding Senior Notes to be declared immediately due and payable. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Income Taxes | 11. Income Taxes The Company applies an estimated annual effective rate to interim period pre-tax income to calculate the income tax provision for the quarter in accordance with the principal method prescribed by the accounting guidance established for computing income taxes in interim periods. The Company’s effective tax rat e was 34.9% and 35.8% during the three months ended September 30, 2015 and 2014 , respectively , and 23.5% and 36.1% during the nine months ended September 30, 2015 and 2014 , respectively. The decrease in the Company’s effective tax rate during the nine months ended September 30, 2015 was primarily due to no income taxes being recorded in conn ection with the preliminary bargain purchase gain of $81.3 million associated with the SWS Merger because the acquisition was a tax-free reorganization under Section 368(a) of the Internal Revenue Code. In addition, the Company recorded an income tax benefit of $2.1 million as a result of the SWS Merger to reverse the deferred tax liability for the difference between book and tax basis on Hilltop’s investment in SWS common stock . The Company also reversed a previously established valuation allowance of $1.9 million on a deferred tax asset associated with a capital loss carryforward . At September 30, 2015 and December 31, 2014 , the Company had net operating loss carryforwards for f ederal income tax purposes of $90.9 million and $45.5 million, respectively. This increase in net operating loss carryforwards was a result of the SWS Merger. The net operating loss carryforwards are subject to either separate return year limitations or annual limitations on their usage because of the ownership change. These net operating loss carryforwards expire in 2023 and later years. The Company expects to realize its current deferred tax asset for these net operating loss carryforwards through the implementation of certain tax planning strategies, core earnings, and reversal of timing differences. The Company has a valuation allowance recorded of $2.2 million at September 30, 2015 against its gross deferred tax asset for an investment that may result in a capital loss . This in crease in the valuation allowance of $0.3 million from December 31, 2014 was a result of an increase in the valuation allowance of $2.2 million from the SWS Merger , offset by a decrease of $1.9 million associated with the unexpected capital gain recognition on a capital loss carryforward . The Company has no valuation allowance on the remainder of its deferred tax assets at September 30, 2015 or December 31, 2014 . GAAP requires the measurement of uncertain tax positions. Uncertain tax positions are the difference between a tax position taken, or expected to be taken in a tax return, and the benefit recognized for accounting purposes. At September 30, 2015 , the total amount of gross unrecognized tax benefits was $0.9 million, of which $0.6 million if recognized, would favorably impact the Company’s effective tax rate. The Company does not anticipate a significant change in the unrecognized tax benefits within the next twelve months. The Company files income tax returns in U.S. federal and numerous state jurisdictions. The Company is subject to tax audits in numerous jurisdictions in the United States until the applicable statute of limitations expires. The Company is no longer subject to U.S. federal tax examinations for tax years prior to 2012. The Company is open for various state tax audits for tax years 2010 and later. The Company is currently under income tax examination by several state authorities for tax years 2011 through 2013. The Company does not expect any significant liability to arise as a result of the examinations. |
Employee Benefits
Employee Benefits | 9 Months Ended |
Sep. 30, 2015 | |
Employee Benefits | |
Employee Benefits | 12. Employee Benefits Deferred Compensation Plan As a result of the SWS Merger, the Company assumed a deferred compensation plan offered by the former SWS (the “SWS Plan”) that allows former SWS eligible officers and employees to defer a portion of their bonus compensation and commissions. The SWS Plan matched 15% of the deferrals made by participants up to a predetermined limit through matching contributions that vest ratably over four years. Pursuant to the terms of the SWS Plan, the trustee periodically purchased the former SWS common stock in the open market. As a result of the SWS Merger, the former SWS common shares were converted into Hilltop common stock based on the terms of the merger agreement. No further contributions can be made to this plan. The assets of the SWS Plan are held in a rabbi trust and primarily include investments in company-owned life insurance (“COLI”) and Hilltop common stock. These assets are consolidated with those of the Company. Investments in COLI are carried at the cash surrender value of the insurance policies and recorded in other assets within the consolidated balance sheet at September 30, 2015 . Investments in Hilltop common stock, which are carried at cost and accounted for in a manner similar to treasury stock, and the corresponding liability related to the deferred compensation plan are presented as components of stockholders’ equity as employee stock trust and deferred compensation employee stock trust, net, respectively, at September 30, 2015 . |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | 13. Commitments and Contingencies Legal Matters The Company is subject to loss contingencies related to litigation, claims, investigations and legal and administrative cases and proceedings arising in the ordinary course of business. The Company evaluates these contingencies based on information currently available, including advice of counsel. The Company establishes accruals for those matters when a loss contingency is considered probable and the related amount is reasonably estimable. Any accruals are periodically reviewed and may be adjusted as circumstances change. A portion of the Company’s exposure with respect to loss contingencies may be offset by applicable insurance coverage. In determining the amounts of any accruals or estimates of possible loss contingencies, the Company does not take into account the availability of insurance coverage, other than that provided by reinsurers in the insurance segment. When it is practicable, the Company estimates loss contingencies for possible litigation and claims, whether or not there is an accrued probable loss. When the Company is able to estimate such possible losses, and when it estimates that it is reasonably possible it could incur losses, in excess of amounts accrued, the Company is required to make a disclosure of the aggregate estimation. As available information changes, however, the matters for which the Company is able to estimate, as well as the estimates themselves will be adjusted, accordingly. Assessments of litigation and claims exposures are difficult due to many factors that involve inherent unpredictability. Those factors include the following: the varying stages of the proceedings, particularly in the early stages; unspecified, unsupported, or uncertain damages; damages other than compensatory, such as punitive damages; a matter presenting meaningful legal uncertainties, including novel issues of law; multiple defendants and jurisdictions; whether discovery has begun or not or discovery is not complete; meaningful settlement discussions have not commenced; and whether the claim involves a class action and if so, how the class is defined. As a result of some of these factors, the Company may be unable to estimate reasonably possible losses with respect to some or all of the pending and threatened litigation and claims asserted against the Company. Each of Hilltop, Securities Holdings , SWS and the individual members of the board of directors of SWS have been named as defendants in two purported stockholder class action lawsuits arising out of the SWS Merger. Both lawsuits were filed in Delaware Chancery Court ( Joseph Arceri v. SWS Group, Inc. et al and Chaile Steinberg v. SWS Group, Inc. et al filed April 8, 2014 and April 11, 2014, respectively). On May 13, 2014, the Delaware Chancery Court consolidated the two actions (the “Consolidated Action”) for all purposes. On June 10, 2014, plaintiffs filed a consolidated amended complaint. The complaint generally alleges, among other things, that the SWS board of directors breached its fiduciary duties to stockholders by failing to take steps to maximize stockholder value or to engage in a fair sale process before approving the merger, that the SWS board of directors labored under conflicts of interest, that certain provisions of the merger agreement unduly restrict SWS's ability to negotiate with other potential bidders, and that the other defendants aided and abetted the SWS board of director's breaches of fiduciary duty. The complaint further alleges, among other things, that the proxy statement/prospectus filed by Hilltop on May 29, 2014 omits or misstates certain material information. The complaints seek relief that includes, among other things, an injunction prohibiting the consummation of the SWS Merger, rescission to the extent the merger terms have already been implemented, damages for the alleged breaches of fiduciary duty, and the payment of plaintiffs' attorneys' fees and costs. On November 13, 2014, the parties to the Consolidated Action entered into a memorandum of understanding (the “MOU”) reflecting the terms of an agreement, subject to final approval by the Court and certain other conditions, to settle the Consolidated Action. Pursuant to the MOU, defendants, without admitting any wrongdoing, agreed to make certain supplemental disclosures requested by plaintiffs in the Consolidated Action, as set forth in SWS’s Current Report on Form 8-K dated November 14, 2014. In addition, Hilltop agreed to forbear from asserting certain rights under the Agreement and Plan of Merger, dated as of March 31, 2014, by and among Hilltop, Securities Holdings and SWS. The MOU further contemplates that, following confirmatory discovery, the parties will enter into a stipulation of settlement, which will be subject to customary conditions, including court approval following notice to the former stockholders of SWS. If the parties enter into a stipulation of settlement, a hearing will be scheduled at which the court will consider the fairness, reasonableness and adequacy of the settlement. There can be no assurance that the parties will ultimately enter into a stipulation of settlement, that the applicable court will approve any proposed settlement, or that any eventual settlement will be under the same terms as those contemplated by the MOU. Following completion of Hilltop’s acquisition of SWS, several purported holders of shares of SWS common stock, representing a total of approximately 8.43 million shares of common stock of SWS, filed petitions in the Court of Chancery of the State of Delaware seeking appraisal for their shares pursuant to Section 262 of the Delaware General Corporation Law. The actions are captioned as follows: Highland Select Equity Master Fund, L.P. et al. v. SWS Group, Inc. et al. , C.A. No. 10554-VCG; Lone Star Value Investors, LP et al. v. SWS Group, Inc. et al. , C.A. No. 10572-VCG; and Merlin Partners, LP et al. v. SWS Group, Inc. et al. , C.A. No. 10578-VCG. The Company believes these claims are without merit and intends to vigorously defend these actions. On or about November 2, 2012, FSC, along with thirteen other defendants, was named in a lawsuit pending in the state of Rhode Island Superior Court styled Rhode Island Economic Development Corporation v. Wells Fargo Securities, LLC, et al . FSC is included in connection with its role as financial advisor to the State of Rhode Island, specifically in connection with the Rhode Island Economic Development Corporation’s issuance of $75 million in bonds to finance a loan to 38 Studios, LLC. FSC intends to defend itself vigorously in this action. The Company is involved in information-gathering requests and investigations (both formal and informal), as well as reviews, examinations and proceedings (collectively, “Inquiries”) by various governmental regulatory agencies, law enforcement authorities and self-regulatory bodies regarding certain of its businesses, business practices and policies, as well as the conduct of persons with whom it does business. Additional Inquiries will arise from time to time. In connection with those Inquiries, the Company receives document requests, subpoenas and other requests for information. The Inquiries, including the Inquiry described below, could develop into administrative, civil or criminal proceedings or enforcement actions that could result in consequences that have a material effect on the Company's consolidated financial position, results of operations or cash flows as a whole. Such consequences could include adverse judgments, findings, settlements, penalties, fines, orders, injunctions, restitution, or alterations in the Company’s business practices, and could result in additional expenses and collateral costs, including reputational damage. As a part of an industry-wide inquiry, PrimeLending received a subpoena from the Office of Inspector General of the U.S. Department of Housing and Urban Development regarding mortgage-related practices, including those relating to origination practices for loans insured by the Federal Housing Administration (the “FHA”). On August 20, 2014, PrimeLending received a Civil Investigative Demand from the United States Department of Justice (the “DOJ”) related to this Inquiry. According to the Civil Investigative Demand, the DOJ is conducting an investigation to determine whether PrimeLending has violated the False Claims Act in connection with originating and underwriting single-family residential mortgage loans insured by the FHA. No allegations have been asserted against PrimeLending. PrimeLending cannot predict the ultimate outcome of this investigation, and cannot make a reasonable estimate of potential liability, if any, at this time. PrimeLending continues to cooperat e with the investigation. While the final outcome of litigation and claims exposures or of any Inquiries is inherently unpredictable, management is currently of the opinion that the outcome of pending and threatened litigation and Inquiries will not have a material effect on the Company’s business, consolidated financial position, results of operations or cash flows as a whole. However, in the event of unexpected future developments, it is reasonably possible that an adverse outcome in any of the matters discussed above could be material to the Company’s business, consolidated financial position, results of operations or cash flows for any particular reporting period of occurrence. Other Contingencies The mortgage origination segment may be responsible for errors or omissions relating to its representations and warranties that each loan sold meets certain requirements, including representations as to underwriting standards and the validity of certain borrower representations in connection with the loan. If determined to be at fault, the mortgage origination segment either repurchases the affected loan from the investor or reimburses the investor’s losses. The mortgage origination segment has established an indemnification liability reserve for such probable losses. Generally, the mortgage origination segment first becomes aware that an investor believes a loss has been incurred on a sold loan when it receives a written request from the investor to repurchase the loan or reimburse the investor’s losses. Upon completing its review of the investor’s request, the mortgage origination segment establishes a specific claims reserve for the loan if it concludes its obligation to the investor is both probable and reasonably estimable. An additional reserve has been established for probable investor losses that may have been incurred, but not yet reported to the mortgage origination segment based upon a reasonable estimate of such losses. Factors considered in the calculation of this reserve include, but are not limited to, the total volume of loans sold exclusive of specific investor requests, actual investor claim settlements and the severity of estimated losses resulting from future claims, and the mortgage origination segment’s history of successfully curing defects identified in investor claim requests. While the mortgage origination segment’s sales contracts typically include borrower early payment default repurchase provisions, these provisions have not been a primary driver of investor claims to date, and therefore, are not a primary factor considered in the calculation of this reserve. At September 30, 2015 and December 31, 2014 , the mortgage origination segment’s indemnification liability reserve totaled $16.1 million and $17.6 million, respectively . The provision for indemnification losses was $1.1 million and $0.9 million during the three months ended September 30, 2015 and 2014 , respectively, and $3.1 million and $2.3 million during the nine months ended September 30, 2015 and 2014 , respectively. The following tables provide for a rollforward of claims activity for loans put-back to the mortgage origination segment based upon an alleged breach of a representation or warranty with respect to a loan sold and related indemnification liability reserve activity (in thousands). Representation and Warranty Specific Claims Activity - Origination Loan Balance Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Claims made Claims resolved with no payment Repurchases Indemnification payments Balance, end of period $ $ $ $ Indemnification Liability Reserve Activity Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions for new sales Repurchases Early payment defaults Indemnification payments Change in estimate Balance, end of period $ $ $ $ September 30, December 31, 2015 2014 Reserve for Indemnification Liability: Specific claims $ $ Incurred but not reported claims Total $ $ Although management considers the total indemnification liability reserve to be appropriate, there may be changes in the reserve over time to address incurred losses, due to unanticipated adverse changes in the economy and historical loss patterns, discrete events adversely affecting specific borrowers or industries, and/or actions taken by institutions or investors. The impact of such matters is considered in the reserving process when probable and estimable. In connection with the FNB Transaction, the Bank entered into two loss-share agreements with the FDIC that collectively cover $1.2 billion of loans and OREO acquired in the FNB Transaction. Pursuant to the loss-share agreements, the FDIC has agreed to reimburse the Bank the following amounts with respect to the covered assets: (i) 80% of net losses on the first $240.4 million of net losses incurred; (ii) 0% of net losses in excess of $240.4 million up to and including $365.7 million of net losses incurred; and (iii) 80% of net losses in excess of $365.7 million of net losses incurred. Net losses are defined as b ook value losses plus certain defined expenses incurred in the resolution of assets, less subsequent recoveries. Under the loss-share agreement for commercial assets , the amount of subsequent recoveries that are reimbursable to the FDIC for a particular asset is limited to b ook value losses and expenses actually billed plus any b ook value charge-offs incurred prior to the Bank Closing Date . There is no limit on the amount of subsequent recoveries reimbursable to the FDIC under the loss-share agreement f or single family residential assets . The loss-share agreements for commercial and single family residential assets are in effect for 5 years and 10 years, respectively, from the Bank Closing Date and the loss recovery provisions to the FDIC are in effect for 8 years and 10 years, respectively, from the Bank Closing Date. In accordance with the loss-share agreements, the Bank may be required to make a “true-up” payment to the FDIC approximately 10 years following the Bank Closing Date if the FDIC’s initial estimate of losses on covered assets is greater than the actual realized losses. The “true-up” payment is calculated using a defined formula set forth in the P&A Agreement. As of September 30, 2015 , the Bank estimated that the sum of covered losses and reimbursable expenses subject to the loss-share agreements will excee d $240.4 million, but will not exceed $365.7 million. Unless actual plus projected covered losses and reimbursable expenses exceed $365.7 million, the Bank will not record a dditional amounts to the FDIC Indemnification Asset. As of September 30, 2015 , the Bank had billed $123.7 million of covered net losses to the FDIC, of which 80% , or $98.9 million, were reimbursable under the loss-share agreements. As of September 30, 2015 , the Bank had received aggregate reimbursements of $98.9 million from the FDIC. |
Financial Instruments with Off-
Financial Instruments with Off-Balance Sheet Risk | 9 Months Ended |
Sep. 30, 2015 | |
Financial Instruments with Off-Balance Sheet Risk | |
Financial Instruments with Off-Balance Sheet Risk | 14. Financial Instruments with Off-Balance Sheet Risk The Bank is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit that involve varying degrees of credit and interest rate risk in excess of the amount recognized in the consolidated financial statements. Such financial instruments are recorded in the consolidated financial statements when they are funded or related fees are incurred or received. The contract amounts of those instruments reflect the extent of involvement (and therefore the exposure to credit loss) the Bank has in particular classes of financial instruments. Commitments to extend credit are agreements to lend to a customer provided that the terms established in the contract are met. Commitments generally have fixed expiration dates and may require payment of fees. Because some commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. These letters of credit are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan commitments to customers. In the aggregate, the Bank had outstanding unused commitments to extend credit of $1.6 billion at September 30, 2015 and outstanding financial and performance standby letters of credit of $45.5 million at September 30, 2015 . The Bank uses the same credit policies in making commitments and standby letters of credit as it does for on-balance sheet instruments. The amount of collateral obtained, if deemed necessary, in these transactions is based on management’s credit evaluation of the borrower. Collateral held varies but may include real estate, accounts receivable, marketable securities, interest-bearing deposit accounts, inventory, and property, plant and equipment. In the normal course of business, the Hilltop Broker-Dealers execute, settle, and finance various securities transactions that may expose the Hilltop Broker-Dealers to off-balance sheet risk in the event that a customer or counterparty does not fulfill its contractual obligations. Examples of such transactions include the sale of securities not yet purchased by customers or for the accounts of the Hilltop Broker-Dealers, use of derivatives to support certain non-profit housing organization clients, clearing agreements between the Hilltop Broker-Dealers and various clearinghouses and broker-dealers, secured financing arrangements that involve pledged securities, and when-issued underwriting and purchase commitments. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2015 | |
Stock-Based Compensation | |
Stock-Based Compensation | 15. Stock-Based Compensation Pursuant to the Hilltop Holdings Inc. 2012 Equity Incentive Plan (the “2012 Plan”), the Company may grant nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights and other awards to employees of the Company, its subsidiaries and outside directors of the Company. In the aggregate, 4,000,000 shares of common stock may be delivered pursuant to awards granted under the 2012 Plan. At September 30, 2015 , 3,947,579 shares of common stock remained available for issuance pursuant to the 2012 Plan , including shares that may be delivered pursuant to outstanding awards . During th e nine months ended September 30, 2015 , the Compensation Committee of the Board of Directors of the Company awarded certain executives and key employees an aggregate of 459,975 restricted stock units (“RSUs”) pursuant to the 2012 Plan , of which 449,110 remained outstanding at September 30, 2015. At September 30, 2015 , 353,272 of these RSUs were subject to time-based vesting conditions and generally provided for a cliff vest on the third anniversary of the grant date, and 95,838 of these RSUs provided for vest ing based upon the achievement of certain performance goals over a three -year period. The RSUs awarded during the nine months ended September 30, 2015 are subject to service conditions set forth in the award agreements, with associated costs recognized on a straight-line basis over the respective vesting period s. The weighted average grant date fair value related to these RSUs was $19.51 per share. At September 30, 2015 , unrecognized compensation expense related to the RSUs awarded during the nine months ended September 30, 2015 was $7.4 million, which will be amortized through August 2018. The RSUs are not transferable, and the shares of common stock issuable upon conversion of vested RSUs are generally subject to transfer restrictions for a period of one year following conversion, subject to certain exceptions. In addition, the applicable RSU award agreements provide for accelerated vesting under certain conditions. Prior to the completion of the SWS Merger and in accordance with the SWS merger agreement, on August 20, 2014, SWS granted restricted shares of SWS common stock to certain of its executive officers and key employees. On January 1, 2015, the effective time of the SWS Merger, these restricted shares of SWS common stock converted into the right to receive an aggregate of 62,994 restricted shares of Hilltop common stock (“Restricted Stock Awards”) based on the value of the merger consideration, and their vesting schedule did not accelerate. At September 30, 2015 , 12,118 Restricted Stock Awards remained outstanding . Such Restricted Stock Awards generally vest in three equal annual installments beginning on August 20, 2015, and are subject to service conditions set forth in the award agreements, with associated costs recognized on a straight-line basis over the respective vesting periods. The fair value of these Restricted Stock Awards at the time of conversion was $19.95 per share. At September 30, 2015 , unrecognized compensation expense related to these Restricted Stock Awards was $0.2 million, which will be amortized through August 2017. The award agreements governing these Restricted Stock Awards provide for accelerated vesting under certain conditions. During 2014 and 2013 , the Compensation Committee of the Board of Directors of the Company awarded certain executives and key employees an aggregate of 444,175 RSUs and 471,000 Restricted Stock Awards, respectively, pursuant to the 2012 Plan, of which 411,325 and 444,000 , respectively, remained outstanding at September 30, 2015 . At September 30, 2015 , unrecognized compensation expense related to these awards was $6.1 million, which will be amortized through December 2017. The award agreements governing these awards provide for accelerated vesting under certain conditions. Compensation expense related to the plans was $2.0 million and $1.3 million during the three months ended September 30, 2015 and 2014 , respectively, and $6.2 million and $3.3 million during the nine months ended September 30, 2015 and 2014 , respectively. During the nine months ended September 30, 2015 and 2014 , Hilltop granted 8,219 and 7,227 shares of common stock to certain non-employee members of the Company’s Board of Directors for services rendere d to the Company pursuant to the 2012 Plan. |
Regulatory Matters
Regulatory Matters | 9 Months Ended |
Sep. 30, 2015 | |
Regulatory Matters | |
Regulatory Matters | 16. Regulatory Matters Banking and Hilltop The Bank and Hilltop are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory — and possibly additional discretionary — actions by regulators that, if undertaken, could have a direct, material effect on the consolidated financial statements. The regulations require the Bank and Hilltop to meet specific capital adequacy guidelines that involve quantitative measures of assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. On January 1, 2015, the new comprehensive capital framework (“Basel III”) for U.S. banking organizations became effective for the Bank and Hilltop for reporting periods beginning after January 1, 2015 (subject to a phase-in period through January 2019). Under Basel III, total capital consists of two tiers of capital, Tier 1 and Tier 2. Tier 1 capital is further composed of common equity Tier 1 capital and additional Tier 1 capital. Total capital is the sum of Tier 1 capital and Tier 2 capital. Quantitative measures established by regulation to ensure capital adequacy require the companies to maintain minimum amounts and ratios (set forth in the following table) of Tier 1 capital (as defined in the regulations) to total average assets (as defined), and minimum ratios of common equity Tier 1, Tier 1 and total capital (as defined) to risk-weighted assets (as defined). In addition, under the final rules, bank holding companies with less than $15 billion in assets as of December 31, 2009 are allowed to continue to include junior subordinated debentures in Tier 1 capital, subject to certain restrictions. However, if an institution grows to above $15 billion in assets as a result of an acquisition, or organically grows to above $15 billion in assets and then makes an acquisition, the combined trust preferred issuances must be phased out of Tier 1 and into Tier 2 capital (75% in 2015 and 100% in 2016). All of the debentures issued to the Trusts, less the common stock of the Trusts, qualified as Tier 1 capital as of September 30, 2015 , under guidance issued by the Board of Governors of the Federal Reserve System. The following table shows the Bank’s and Hilltop’s consolidated actual capital amounts and ratios compared to the regulatory minimum capital requirements and the Bank’s regulatory minimum capital requirements needed to qualify as a “well-capitalized” institution in accordance with Basel III as measured at September 30, 2015 and applicable regulatory guidelines at December 31, 2014 (dollars in thousands). To Be Well Capitalized Minimum Capital Minimum Capital Actual Requirements Requirements Amount Ratio Amount Ratio Amount Ratio September 30, 2015 Tier 1 capital (to average assets): Bank $ % $ % $ % Hilltop % % N/A N/A Common equity Tier 1 capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A Tier 1 capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A Total capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A December 31, 2014 Tier 1 capital (to average assets): Bank $ % $ % $ % Hilltop % % N/A N/A Tier 1 capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A Total capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A To be considered “adequately capitalized” (as defined) under regulatory requirements, the Bank must maintain minimum Tier 1 capital to total average assets of 4% , common equity Tier 1 capital to risk-weighted assets of 4.5% , Tier 1 capital to risk-weighted assets ratios of 6% (an increase from 4% prior to January 1, 2015), and a total capital to risk-weighted assets ratio of 8% . Based on the actual capital amounts and ratios shown in the previous table, the Bank’s ratios place it in the “well capitalized” (as defined) capital category under regulatory requirements. Broker-Dealer Pursuant to the net ca pital requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), FSC and Hilltop Securities have each elected to determine their respective net capital requirements using the alternative method. Accordingly, FSC and Hilltop Securities are requ ired to maintain minimum net capital, as defined in Rule 15c3-1 promulgated under the Exchange Act, equal to the greater of $250,000 and 1,000,000 , respectively, or 2% of aggregate debit balances, as defined in Rule 15c3-3 promulgated under the Exchange Act. Additionally, the net capital rule of the NYSE provides that equity ca pital may not be withdrawn or cash dividends paid if resulting net capital would be less than 5% of the aggregate debit items. HTS Independent Network follows the primary (aggregate indebtedness) method, as defined in Rule 15c3-1 promulgated und er the Exchange Act, which requires the maintenance of the larger of minimum net capital of $250,000 or 1/15 of aggregate indebtedness. At September 30, 2015 , the net capital position of each of the Hilltop Broker-Dealers was as follows (in thousands). HTS Hilltop Independent FSC Securities Network Net capital $ $ $ Less required net capital Excess net capital $ $ $ Net capital as a percentage of aggregate debit items % % Net capital in excess of 5% aggregate debit items $ $ Under certain conditions, the Hilltop Broker-Dealers may be required to segregate cash and securities in a special reserve account for the benefit of customers under Rule 15c3-3 promulgated under the Exchange Act. Assets segregated under the provisions of the Exchange Act are not available for general corporate purposes. A t September 30, 2015 and December 31, 2014 , t he Hilltop Broker-Dealers held cash of $227.3 million and $76.0 million , respectively , segregated in special reserve bank accounts for the benefit of customers . Additionally, t he Hilltop Broker-Dealers had $1.0 million in cash in special reserve account s for the benefit of proprietary accounts of introducing broker-dealers at September 30, 2015 . T he fair values of these segregated assets included in special reserve accounts were determined using Level 1 inputs. Mortgage Origination As a mortgage originator, PrimeLending is subject to minimum net worth requirements established by the U.S. Department of Housing and Urban Development (“HUD”) and the GNMA. On an annual basis, PrimeLending submits audited financial statements to HUD and GNMA documenting PrimeLending’s compliance with its minimum net worth requirements. In addition, PrimeLending monitors compliance on an ongoing basis and, as of September 30, 2015 , PrimeLending’s net worth exceeded the amounts required by both HUD and GNMA. Insurance The statutory financial statements of the Company's insurance subsidiaries, which are domiciled in the State of Texas, are presented on the basis of accounting practices prescribed or permitted by the Texas Department of Insurance. Texas has adopted the statutory accounting practices of the National Association of Insurance Commissioners (“NAIC”) as the basis of its statutory accounting practices with certain differences that are not significant to the insurance company subsidiaries’ statutory equity. A summary of statutory capital and surplus and statutory net income (loss) of each insurance subsidiary is as follows (in thousands). September 30, December 31, 2015 2014 Capital and surplus: National Lloyds Insurance Company $ $ American Summit Insurance Company Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Statutory net income (loss): National Lloyds Insurance Company $ $ $ $ American Summit Insurance Company Regulations of the Texas Department of Insurance require insurance companies to maintain minimum levels of statutory surplus to ensure their ability to meet their obligations to policyholders. At September 30, 2015 , the Company's insurance subsidiaries had statutory surplus in excess of the minimum required. The NAIC has adopted a risk based capital (“RBC”) formula for insurance companies that establishes minimum capital requirements indicating various levels of available regulatory action on an annual basis relating to insurance risk, asset credit risk, interest rate risk and business risk. The RBC formula is used by the NAIC and certain state insurance regulators as an early warning tool to identify companies that require additional scrutiny or regulatory action. At September 30, 2015 , the Company's insurance subsidiaries' RBC ratio exceeded the level at which regulatory action would be required. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note | |
Stockholders' Equity | 17. Stockholders’ Equity Stock Repurchase Program During the second quarter of 2015, the Company’s Board of Directors approved a stock repurchase program under which it authorized the Company to repurchase, in the aggregate, up to $30.0 million of its outstanding common stock. Under the stock repurchase program authorized, the Company may repurchase shares in open-market purchases or through privately negotiated transactions as permitted under Rule 10b-18 promulgated under the Exchange Act. As of September 30, 2015, the Company had repurchased an aggregate of $30.0 million of its outstanding common stock, and does not intend to make any future purchases of its common stock under this program. The extent to which the Company repurchase d its shares and the timing of such repurchases depend ed upon market conditions and other corporate considerations, as determined by Hilltop’s management team. The purchases were funded from available cash balances. During the three and nine months ended September 30, 2015 , the Company paid $13.0 million and $30.0 million, respectively, to repurchase and retire an aggregate of 1,390,977 shares of common stock at an average price of $21.56 per share. These retired shares were returned to the Company’s pool of authorized but unissued shares of common stock. The Company uses the par value method of accounting for its stock repurchases, whereby the par value of the shares is deducted from common stock. The excess of the cost of shares acquired over the par value is allocated to additional paid-in capital based on an estimated average sales price per issued share with the excess amounts charged to retained earnings. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | 18. Derivative Financial Instruments The Company uses various derivative financial instruments to mitigate interest rate risk. The Bank’s interest rate risk management strategy involves effectively managing the re-pricing characteristics of certain assets and liabilities to mitigate potential adverse impacts from changes in interest rates on the net interest margin. PrimeLending has interest rate risk relative to interest rate lock commitments (“IRLCs”) and its inventory of mortgage loans held for sale. PrimeLending is exposed to such interest rate risk from the time an IRLC is made to an applicant to the time the related mortgage loan is sold. To mitigate interest rate risk, PrimeLending executes forward commitments to sell mortgage-backed securities (“MBSs”). Additionally, PrimeLending has interest rate risk relative to its MSR asset. During the three months ended September 30, 2014, PrimeLending began using derivative instruments, including interest rate swaps and swaptions, to hedge this risk. The Hilltop Broker-Dealers use forward commitments to both purchase and sell MBSs to facilitate customer transactions and as a means to hedge related exposure to interest rate risk in certain inventory positions. Non-Hedging Derivative Instruments and the Fair Value Option As discussed in Note 3 to the consolidated financial statements, the Company has elected to measure substantially all mortgage loans held for sale at fair value under the provisions of the Fair Value Option. The election provides the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without applying complex hedge accounting provisions. The fair values of PrimeLending’s IRLCs, forward commitments, and interest rate swaps and swaptions are recorded in other assets or other liabilities, as appropriate, and changes in the fair values of these derivative instruments are recorded as a component of net gains from sale of loans and other mortgage production income. The fair value of PrimeLen ding’s derivative instruments de creased $15.5 million during the three months ended September 30, 2015 , compared with a n in crease of $0.2 million during the same period in 2014 , and an increase of $17.8 million during the nine months ended September 30, 2015 , c ompared with a decrease of $5.0 million during the same period in 2014 . Changes in fair value are attributable to changes in the volume of IRLCs, mortgage loans held for sale, commitments to purchase and sell MBSs and MSR assets, and changes in market interest rates. Changes in market interest rates also conversely affect the value of PrimeLending’s mortgage loans held for sale and its MSR asset, which are measured at fair value under the Fair Value Option. The effect of the change in market interest rates on PrimeLending’s loans held for sale and MSR asset is discussed in Note 3 to the consolidated financial statements. The fair values of the Hilltop Broker-Dealers’ derivative instruments are recorded in other assets or other liabilities, as appropriate, and the fair values of the Hilltop Broker-Dealers’ derivatives increased $12.7 million and $5.3 million during the three months ended September 30, 2015 and 2014 , re spectively, and increased $30.5 million and $11.4 million during the nine months ended September 30, 2015 and 2014 , respectively. The changes in fair value were recorded as a component of other noninterest income. Derivative positions are presented in the following table (in thousands). September 30, 2015 December 31, 2014 Notional Estimated Notional Estimated Amount Fair Value Amount Fair Value Derivative instruments: IRLCs $ $ $ $ Commitments to purchase MBSs Commitments to sell MBSs Interest rate swaps and swaptions PrimeLending had cash collateral advances totaling $8.4 million and $6.6 million to offset net liability derivative positions on its commitments to sell MBSs at September 30, 2015 and December 31, 2014 , respectively. In addition, PrimeLending advanced cash collateral totaling $4.0 million and $3.3 million in initial margin on its interest rate swaps and swaptions at September 30, 2015 and December 31, 2014 , respectively. These amounts are included in other assets within the consolidated balance sheets. |
Balance Sheet Offsetting
Balance Sheet Offsetting | 9 Months Ended |
Sep. 30, 2015 | |
Balance Sheet Offsetting | |
Balance Sheet Offsetting | 19. Balance Sheet Offsetting Certain financial instruments, including resale and repurchase agreements, securities lending arrangements and derivatives, may be eligible for offset in the consolidated balance sheets and/or subject to master netting arrangements or similar agreements. The following tables present the assets and liabilities subject to enforceable master netting arrangements, repurchase agreements, or similar agreements with offsetting rights (in thousands). Gross Amounts Not Offset in Net Amounts the Balance Sheet Gross Amounts Gross Amounts of Assets Cash of Recognized Offset in the Presented in the Financial Collateral Net Assets Balance Sheet Balance Sheet Instruments Pledged Amount September 30, 2015 Securities borrowed: Institutional counterparties $ $ — $ $ $ — $ — Interest rate swaps and swaptions: Institutional counterparties — — Reverse repurchase agreements: Institutional counterparties — — Forward MBS derivatives: Institutional counterparties — — — $ $ $ $ $ — $ December 31, 2014 Securities borrowed: Institutional counterparties $ $ — $ $ $ — $ — Interest rate swaps and swaptions: Institutional counterparties — — — Forward MBS derivatives: Institutional counterparties — — — $ $ — $ $ $ — $ Gross Amounts Not Offset in Net Amounts the Balance Sheet Gross Amounts Gross Amounts of Liabilities Cash of Recognized Offset in the Presented in the Financial Collateral Net Liabilities Balance Sheet Balance Sheet Instruments Pledged Amount September 30, 2015 Securities loaned: Institutional counterparties $ $ — $ $ $ — $ — Interest rate swaps and swaptions: Institutional counterparties — — Repurchase agreements: Institutional counterparties — — — Customer counterparties — — — Forward MBS derivatives: Institutional counterparties — $ $ $ $ $ — $ December 31, 2014 Securities loaned: Institutional counterparties $ $ — $ $ $ — $ — Repurchase agreements: Customer counterparties — — — Forward MBS derivatives: Institutional counterparties — $ $ $ $ $ $ Secured Borrowing Arrangements Secured Borrowings (Repurchase Agreements) — The Company participates in transactions involving securities sold under repurchase agreements, which are secured borrowings and generally mature within one to thirty days from the transaction date. Securities sold under repurchase agreements are reflected at the amount of cash received in connection with the transactions. The Company may be required to provide additional collateral based on the fair value of the underlying securities, which is monitored on a daily basis. Securities Lending Activities — The Company’s securities lending activities includes lending securities for other broker-dealers, lending institutions and its own clearing and retail operations. These activities involve lending securities to other broker-dealers to cover short sales, to complete transactions in which there has been a failure to deliver securities by the required settlement date and as a conduit for financing activities. When lending securities, the Company receives cash or similar collateral and generally pays interest (based on the amount of cash deposited) to the other party to the transaction. Securities lending transactions are executed pursuant to written agreements with counterparties that generally require securities loaned to be marked-to-market on a daily basis. The Company receives collateral in the form of cash in an amount generally in excess of the fair value of securities loaned. The Company monitors the fair value of securities loaned on a daily basis, with additional collateral obtained or refunded, as necessary. Collateral adjustments are made on a daily basis through the facilities of various clearinghouses. The Company is a principal in these securities lending transactions and is liable for losses in the event of a failure of any other party to honor its contractual obligation. Management sets credit limits with each counterparty and reviews these limits regularly to monitor the risk level with each counterparty. The Company is subject to credit risk through its securities lending activities if securities prices decline rapidly because the value of the Company’s collateral could fall below the amount of the indebtedness it secures. In rapidly appreciating markets, credit risk increases due to short positions. The Company’s securities lending business subjects the Company to credit risk if a counterparty fails to perform or if collateral securing its obligations is insufficient. In securities transactions, the Company is subject to credit risk during the period between the execution of a trade and the settlement by the customer. The following tables present the remaining contractual maturities of repurchase agreement and securities lending transactions accounted for as secured borrowings (in thousands). The Company had no repurchase-to-maturity transactions outstanding at September 30, 2015 or December 31, 2014 . Remaining Contractual Maturities Overnight and Greater Than September 30, 2015 Continuous Up to 30 Days 30-90 Days 90 Days Total Repurchase agreement transactions: U.S. Treasury and agency securities $ $ $ $ — $ Securities lending transactions: U.S. Treasury and agency securities — — — Corporate securities — — — Equity securities — — — Total $ $ $ $ — $ Gross amount of recognized liabilities for repurchase agreement and securities lending transactions in offsetting disclosure above $ Amount related to agreements not included in offsetting disclosure above $ — Remaining Contractual Maturities Overnight and Greater Than December 31, 2014 Continuous Up to 30 Days 30-90 Days 90 Days Total Repurchase agreement transactions: U.S. Treasury and agency securities $ $ — $ — $ — $ Securities lending transactions: U.S. Treasury and agency securities — — — Corporate securities — — — Equity securities — — — Total $ $ — $ — $ — $ Gross amount of recognized liabilities for repurchase agreement and securities lending transactions in offsetting disclosure above $ Amount related to agreements not included in offsetting disclosure above $ — |
Broker-Dealer and Clearing Orga
Broker-Dealer and Clearing Organization Receivables and Payables | 9 Months Ended |
Sep. 30, 2015 | |
Broker-Dealer and Clearing Organization Receivables and Payables | |
Broker-Dealer and Clearing Organization Receivables and Payables | 20. Broker-Dealer and Clearing Organization Receivables and Payables Broker-dealer and clearing organization receivables and payables consisted of the following (in thousands). September 30, December 31, 2015 2014 Receivables: Securities borrowed $ $ Securities failed to deliver Clearing organizations Trades in process of settlement, net — Other $ $ Payables: Securities loaned $ $ Correspondents Securities failed to receive Clearing organizations $ $ |
Reserves for Losses and Loss Ad
Reserves for Losses and Loss Adjustment Expenses | 9 Months Ended |
Sep. 30, 2015 | |
Reserves for Losses and Loss Adjustment Expenses | |
Reserves for Losses and Loss Adjustment Expenses | 21. Reserve for Losses and Loss Adjustment Expenses A rollforward of NLC’s reserve for unpaid losses and loss adjustment expenses (“LAE”), as included in other liabilities within the consolidated balance sheets, is as follows (in thousands). Nine Months Ended September 30, 2015 2014 Balance, beginning of period $ $ Less reinsurance recoverables Net balance, beginning of period Incurred related to: Current year Prior years Total incurred Payments related to: Current year Prior years Total payments Net balance, end of period Plus reinsurance recoverables Balance, end of period $ $ The increase in NLC’s reserves at September 30, 2015 as compared with September 30, 2014 of $10.4 million is primarily due to increased reserves attributable to an increase in frequency and severity of severe weather events in our geographic coverage area as well as the prior period adverse development and additional reinsurance recoverables associated with the increase in reserves. The prior period adverse development of $5.8 million during the nine months ended September 30, 2015 w as primarily related to litigation emerging from a series of hail storms within the 2012 through 2014 accident years. |
Reinsurance Activity
Reinsurance Activity | 9 Months Ended |
Sep. 30, 2015 | |
Reinsurance Activity | |
Reinsurance Activity | 22. Reinsurance Activity NLC limits the maximum net loss that can arise from large risks or risks in concentrated areas of exposure by reinsuring (ceding) certain levels of risk. Substantial amounts of business are ceded, and these reinsurance contracts do not relieve NLC from its obligations to policyholders. Such reinsurance includes quota share, excess of loss, catastrophe, and other forms of reinsurance on essentially all property and casualty lines of insurance. Net insurance premiums earned, losses and LAE and policy acquisition and other underwriting expenses are reported net of the amounts related to reinsurance ceded to other companies. Amounts recoverable from reinsurers related to the portions of the liability for losses and LAE and unearned insurance premiums ceded to them are reported as assets. Failure of reinsurers to honor their obligations could result in losses to NLC; consequently, allowances are established for amounts deemed uncollectible as NLC evaluates the financial condition of its reinsurers and monitors concentrations of credit risk arising from similar geographic regions, activities, or economic characteristics of the reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. At September 30, 2015 , reinsurance receivables had a carrying value of $18.8 million, which is included in other assets within the consolidated balance sheet. There was no allowance for uncollectible accounts at September 30, 2015 , based on NLC’s quality requirements. The effects of reinsurance on premiums written and earned are summarized as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Written Earned Written Earned Written Earned Written Earned Premiums from direct business $ $ $ $ $ $ $ $ Reinsurance assumed Reinsurance ceded Net premiums $ $ $ $ $ $ $ $ The effects of reinsurance on incurred losses are as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Loss and LAE incurred $ $ $ $ Reinsurance recoverables Net loss and LAE incurred $ $ $ $ Multi-line excess of loss coverage In addition to the catastrophe reinsurance noted below, both NLIC and ASIC participate in an excess of loss program placed with various reinsurers. This program is limited to each risk with respect to property and liability in the amount of $500,000 for each of NLIC and ASIC. Each of NLIC and ASIC retain $500,000 in this program. Catastrophic coverage At September 30, 2015 , NLC had catastrophic excess of loss reinsurance coverage of losses per event in excess of $8.0 million retention by NLIC and $1.5 million retention by ASIC. ASIC maintained an underlying layer of coverage, providing $6.5 million in excess of its $1.5 million retention to bridge to the primary program. The reinsurance for NLIC and ASIC in excess of $8.0 million is comprised of four layers of protection: $17.0 million in excess of $8.0 million retention and/or loss; $25.0 million in excess of $25.0 million loss; $25.0 million in excess of $50.0 million loss and $50 .0 million in excess of $75.0 million loss. NLIC and ASIC retain no participation in any of the layers, beyond the first $8 .0 million and $1.5 million, respectively. At September 30, 2015 , total retention for any one catastrophe that affects both NLIC and ASIC was limited to $8.0 million in the aggregate. Effective January 1, 2015, NLC renewed its underlying excess of loss contract that provides $10.0 million aggregate coverage for sub-catastrophic events. NLC retains a 9% participation in this coverage. Effective July 1, 2015, NLC renewed its catastrophic excess of loss reinsurance coverage for a two -year period. The reinsurance for NLIC and ASIC in excess of $8.0 million continues in four layers, but the coverage provided in the third and fourth layers was realigned and the total coverage provided was reduced to $125.0 million ($140.0 million through June 30, 2015) . The third and fourth layers of coverage provide $25.0 million ($50.0 million through June 30, 2015) in excess of $50.0 million loss and $50.0 million ($40.0 million through June 30, 2015) in excess of $75.0 million loss. |
Segment and Related Information
Segment and Related Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment and Related Information | |
Segment and Related Information | 23. Segment and Related Information The Company currently has four reportable business segments that are organized primarily by the core products offered to the segments’ respective customers. These segments reflect the manner in which operations are managed and the criteria used by the Company’s chief operating decision maker function to evaluate segment performance, develop strategy and allocate resources. The chief operating decision maker function consists of the President and Chief Executive Officer of the Company and the Chief Executive Officer of PlainsCapit al. For the third quarter of 2015, the Company began presenting the preliminary bargain purchase gain associated with the SWS Merger , previously allocated to the b anking and b roker- d ealer reportable business segments , within c orporate to reflect the Company’s internal evaluation of segment performance. This change is reflected in the segment operating results within noninterest income for the nine months ended September 30, 2015. Additionally, related amounts previously reported in the Company’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2015 and June 30, 2015, respectively, within the notes to the consolidated financial statements, will be revised in future filings. This change had no impact on the Company’s consolidated results of operations. The banking segment includes the operations of the Bank and, since January 1, 2015, the operations of the former SWS FSB acquired in the SWS Merger. The broker-dealer segment includes the operations of First Southwest and, since January 1, 2015, the broker-dealer operations ac quired in the SWS Merger. The mortgage origination segment is composed of PrimeLending, while the insurance segment is composed of NLC. Corporate includes certain activities not allocated to specific business segments. These activities include holding company financing and investing activities, and management and administrative services to support the overall operations of the Company including, but not limited to, certain executive management, corporate relations, legal, finance and acquisition costs. Balance sheet amounts not discussed previously and the elimination of intercompany transactions are included in “All Other and Eliminations.” The following tables present certain information about reportable business segment revenues, operating results, goodwill and assets (in thousands). Mortgage All Other and Hilltop Three Months Ended September 30, 2015 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income — Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ Mortgage All Other and Hilltop Nine Months Ended September 30, 2015 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ Mortgage All Other and Hilltop Three Months Ended September 30, 2014 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income — Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ Mortgage All Other and Hilltop Nine Months Ended September 30, 2014 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income — Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ September 30, 2015 Goodwill $ $ $ $ $ — $ — $ Total assets $ $ $ $ $ $ $ December 31, 2014 Goodwill $ $ $ $ $ — $ — $ Total assets $ $ $ $ $ $ $ |
Earnings per Common Share
Earnings per Common Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings per Common Share | |
Earnings per Common Share | 24. Earnings per Common Share Nonvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are participating securities and are included in the computation of earnings per share pursuant to the two-class method prescribed by the Earnings Per Share Topic of the ASC. The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings. Restricted Stock Awards are the only instruments issued by Hilltop which qualify as participating securities. Net earnings, less any preferred dividends accumulated for the period (whether or not declared), is allocated between the common stock and participating securities pursuant to the two-class method. Basic earnings per common share is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during the period, excluding participating nonvested restricted shares. Diluted earnings per common share is computed in a similar manner, except that first the denominator is increased to include the number of additional common shares that would have been outstanding if potentially dilutive common shares, excluding the participating securities, were issued using the treasury stock method. During the three and nine months ended September 30, 2015 and 2014 , stock options and RSUs are the only potentially dilutive non-participating instruments issued by Hilltop. Next, the Company determines and includes in the diluted earnings per common share calculation the more dilutive effect of the participating securities using the treasury stock method or the two-class method. Undistributed losses are not allocated to the nonvested share-based payment awards (the participating securities) under the two-class method as the holders are not contractually obligated to share in the losses of the Company. The following table presents the computation of basic and diluted earnings per common share (in thousands, except per share data) . Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Basic earnings per share: Income applicable to Hilltop common stockholders $ $ $ $ Less: income applicable to participating shares Net earnings available to Hilltop common stockholders $ $ $ $ Weighted average shares outstanding - basic Basic earnings per common share $ $ $ $ Diluted earnings per share: Income applicable to Hilltop common stockholders $ $ $ $ Weighted average shares outstanding - basic Effect of potentially dilutive securities Weighted average shares outstanding - diluted Diluted earnings per common share $ $ $ $ |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 9 Months Ended |
Sep. 30, 2015 | |
Recently Issued Accounting Standards | |
Recently Issued Accounting Standards | 25. Recently Issued Accounting Standards In September 2015, FASB issued Accounting Standards Update (“ASU”) 2015-16 as part of its initiative to reduce complexity in accounting standards and eliminate the requirement to restate prior period financial statements for measurement period adjustments following a business combination. The amendment requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The prior period impact of the adjustment should be either presented separately on the face of the income statement or disclosed in the notes. The amendment is effective for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. Adoption of the amendment is not expected to have a significant effect on the Company’s consolidated financial statements. In June 2015, FASB issued ASU 2015-10 to clarify the codification, correct unintended application of guidance, eliminate inconsistencies, and to improve the codification’s presentation of guidance for a wide range of topics in the codification. Transition guidance varies based on the amendments included. The amendments that require transition guidance are effe ctive for annual periods, and interim periods within those fiscal periods, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. All other amendments will be effective upon the issuance. Adoption of the amendment is not expected to have a significant effect on the Company’s consolidated financial statements. However, the Company has adopted the amendment related to a clarification of the disclosure requirements for nonrecurring fair value measurements made during the period. In May 2015, the FASB iss ued ASU 2015-09 requiring enhanced disclosures for insurers relating to short-duration insurance contract claims and the unpaid claims liability rollforward for long and short-duration contracts. The amendment is effective for annual periods beginning after December 15, 2015 and interim reporting periods thereafter. Early adoption is permitted. Adoption of the amendment is not expected to have a significant effect on the Company’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03 to simplify presentation of debt issuance costs to require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs is not affected by this amendment. The amendment is effective for annual periods, and interim reporting periods within those annual periods, beginning after December 15, 2015 using the retrospective method of adoption. As permitted within the amendment, the Company elected to early adopt the provisions of this amendment beginning with the three months ended June 30, 2015. Adoption of the amendment resulted in unamortized debt issuance costs of $1.9 million in connection with Hilltop’s issuance of the 5% senior notes due 2025 on April 9, 2015 being presented in the consolidated balance sheet at June 30, 2015 as a reduction from the $150.0 million aggregate principal amount. During the three and nine months ended September 30, 2015 , debt issuance cost s of $33 thousand and $0.1 million, respectively, were amortized and included in interest expense. In February 2015, the FASB issued ASU 2015-02 to modify the analysis that companies must perform in order to determine whether a legal entity should be consolidated. ASU 2015-02 affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. Specifically, the amendments: (i) modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities ("VIEs") or voting interest entities, (ii) eliminate the presumption that a general partner should consolidate a limited partnership, (iii) affect the consolidated analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships and (iv) provide a scope exception for certain entities. The amendment is effective for annual periods, and interim reporting periods within those annual periods, beginning after December 15, 2015. Early adoption is permitted. Adoption of the amendment is not expected to have a significant effect on the Company’s consolidated financial statements. In January 2015, the FASB issued ASU 2015-01 as part of its initiative to reduce complexity in accounting standards. This amendment eliminates the concept of extraordinary items. The amendment is effective for annual periods, and interim reporting periods within those annual periods, beginning after December 15, 2015 and may be adopted using either a full retrospective transition method or a prospective transition method. Adoption of the amendment is not expected to have a significant effect on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09 which clarifies the principles for recognizing revenue from contracts with customers. The amendment outlines a single comprehensive model for entities to depict the transfer of goods or services to customers in amounts that reflect the payment to which a company expects to be entitled in exchange for those goods or services. The amendment also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The amendment was initially scheduled to be effective for the Company no earlier than the first quarter of 2017, however, in July 2015, the FASB voted to defer the effective date by one year. Therefore, the amendment is effective for annual periods, and interim reporting periods within those annual periods, beginning after December 15, 2017 and may be adopted using either a full retrospective transition method or a modified retrospective transition method. Early adoption is permitted no earlier than the first quarter of 2017. The Company is currently evaluating the provisions of the amendment and the impact on its future consolidated financial statements . |
Summary of Significant Accoun34
Summary of Significant Accounting and Reporting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Summary of Significant Accounting and Reporting Policies | |
Nature of Operations | Nature of Operations Hilltop Holdings Inc. (“Hilltop” and, collectively with its subsidiaries, the “Company”) is a financial holding company registered under the Bank Holding Company Act of 1956, as amended by the Gramm-Leach-Bliley Act of 1999. The Company’s primary line of business is to provide business and consumer banking services from offices located throughout Texas through PlainsCapital Bank (the “Bank”). In addition, the Company provides an array of financial products and services through its broker-dealer, mortgage origination and insurance subsidiaries. The Company provides its products and services through three primary operating subsidiaries, PlainsCapital Corporation (“PlainsCapital”), Hilltop Securities Holdings LLC (“Securities Holdings ”) and National Lloyds Corporation (“NLC”). PlainsCapital is a financial holding company, headquartered in Dallas, Texas, that provides, through its subsidiaries, traditional banking services, wealth and investment management and treasury management primarily in Texas and residential mortgage lending throughout the United States. Securities Holdings is a holding company, headquartered in Dallas, Texas, that provides, through its subsidiaries, investment banking and other related financial services, including municipal advisory, sales, trading and underwriting of taxable and tax-exempt fixed income securities, equity trading, clearing, securities lending, structured finance and retail brokerage services throughout the United States. NLC is a property and casualty insurance holding company, headquartered in Waco, Texas, that provides, through its subsidiaries, fire and homeowners insurance to low value dwellings and manufactured homes primarily in Texas and other areas of the southern United States. On January 1, 2015, Hilltop completed its acquisition of SWS Group, Inc. (“SWS”) in a stock and cash transaction (the "SWS Merger"), whereby SWS’s broker-dealer subsidiaries, Southwest Securities , Inc. and SWS Financial Services, Inc., became subsidiaries of Securities Holdings, a wholly owned subsidiary of Hilltop initially formed for the purpose of facilitating this transaction , and SWS’s banking subsidiary, Southwest Securities, FSB (“SWS FSB”), was merged into the Bank, an indirect wholly owned subsidiary of Hilltop. As a result of the SWS Merger, each outstanding share of SWS common stock was converted into the right to receive 0.2496 shares of Hilltop common stock and $1.94 in cash, equating to $6.92 per share based on Hilltop’s closing price on December 31, 2014 and resulting in an aggregate purchase price of $349.1 million, consisting of 10.1 million shares of common stock, $78.2 million in cash and $70.3 million associated with Hilltop’s existing investment in SWS common stock. Additionally, due to appraisal rights proceedings filed in connection with the SWS Merger, the merger consideration is subject to change, and is therefore, preliminary as of the date of this report. Based on purchase date valuations, the fair value of the assets acquired was $3.3 billion, including $707.5 million in securities , $863.8 million in non-covered loans and $1.2 billion in broker-dealer and clearing organization receivables. The fair value of liabilities assumed was $2.9 billion, consisting primarily of deposits of $1.3 billion and $1.1 billion in broker-dealer and clearing organization payabl es. On October 5, 2015, Southwest Securities , Inc. and SWS Financial Services, Inc. w ere renamed “ Hilltop Securities Inc. ” (“Hilltop Securities”) and “ Hilltop |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”), and in conformity with the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of management, these financial statements contain all adjustments necessary for a fair statement of the results of the interim periods presented. Accordingly, the financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (“ 2014 Form 10-K”). Results for interim periods are not necessarily indicative of results to be expected for a full year or any future period. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates regarding the allowance for loan losses, the fair values of financial instruments, the amounts receivable from the Federal Deposit Insurance Corporation (the “FDIC”) under loss-share agreements (the “FDIC Indemnification Asset”), reserves for losses and loss adjustment expenses, the mortgage loan indemnification liability, and the potential impairment of assets are particularly subject to change. The Company has applied its critical accounting policies and estimation methods consistently in all periods presented in these consolidated financial statements. The operations of SWS were included in the Company’s operating results beginning January 1, 2015 and such operations included a preliminary bargain purchase gain of $82.8 million as disclosed in the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 6, 2015. I n accordance with the Business Combinations Topic of the Accounting Standards Codification (“ASC”) , d uring the quarter ended June 30, 2015, the estimated fair value of the customer relationship intangible asset acquired as of January 1, 2015 was adjusted downward as a result of management’s review and approval of certain key assumptions that existed as of January 1, 2 015. Additionally, during the quarter ended September 30, 2015, the estimated fair value of deferred tax assets acquired as of January 1, 2015 was adjusted upward as a result of management’s review and filing of SWS’s consolidated federal tax return for the year ended December 31, 2014. These adjustments resulted in a net decrease in the preliminary bargain purchase gain associated with the SWS Merger to $81.3 million. This change is reflected in the consolidated statements of operations within noninterest income during the nine months ended September 30, 2015 . In the aggregate, t he se adjustment s to the preliminary bargain purchase gain decreased net income for the three months ended March 31, 2015 by $1.5 million as compared with amounts previously reported in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015. Additionally, certain amounts previously reported in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 within the consolidated balance sheet as of March 31, 2015, and the related statement s of comprehensive income, stockholders’ equity and cash flows for the three months ended March 31, 2015, as well as the notes to the consolidated financial statements, will be revised in future filings. Certain reclassifications have been made to the prior period consolidated financial statements to conform with the current period presentation. Additionally, d uring the preparation of the condensed consolidated financial statements for the period ended September 30, 2015, the Company determined that its previously reported unaudited consolidated statements of cash flows contained in the previously filed Quarterly Reports on Form 10-Q filed with SEC on May 6, 2015 and July 29, 2015 contained a classification error related to how certain acquired balances related to its acquisition of SWS were reflected . Management has evaluated the quantitative and qualitative impact of the classification error to previously issued unaudited consolidated statements of cash flows and concluded that the previously issued condensed consolidated financial statements were not materially misstated. H owever, in order to correctly present the cash flow statements, management has elected to revise the unaudited consolidated statements of cash flows for each of the three months ended March 31, 2015 and six months ended June 30, 2015 in its future filings. The correction had no impact on the Company’s financial condition or results of operations for the periods presented. The following table summarizes the revisions made to the Company’s unaudited consolidated statements of cash flows for the noted periods (in thousands) . Three Months Ended March 31, 2015 Six Months Ended June 30,2015 As Originally Reported As Revised As Originally Reported As Revised Operating Activities Net change in broker-dealer and clearing organization receivables $ $ $ $ Net change in broker-dealer and clearing organization payables Net cash provided by (used in) operating activities Investing Activities Net change in loans Net cash provided by investing activities Financing Activities Net change in deposits Net cash used in financing activities Net change in cash and cash equivalents Hilltop owns 100% of the outstanding stock of PlainsCapital. PlainsCapital owns 100% of the outstanding stock of the Bank and 100% of the membership interest in PlainsCapital Equity, LLC. The Bank owns 100% of the outstanding stock of PrimeLending, a PlainsCapital Company (“PrimeLending”) and has a 100% membership interest in PlainsCapital Securities, LLC. PrimeLending owns a 100% membership interest in PrimeLending Ventures Management, LLC, the controlling and sole managing member of PrimeLending Ventures, LLC (“Ventures”). Hilltop has a 100% membership interest in Securities Holdings , which operates through its wholly-owned subsidiaries, First Southwest Holdings, LLC (“First Southwest ”), Hilltop Securities and HTS Independent Network . T he principal subsidiaries of First Southwest are First Southwest Company, LLC (“FSC”), a broker-dealer registered with the SEC and the Financial Industry Regulatory Authority (“FINRA”) and a member of the New York Stock Exchange (“NYSE”), and First Southwest Asset Management, LLC, a registered investment advisor under the Investment Advisors Act of 1 940. Hilltop Securities is a broker-dealer registered with the SEC and FINRA and a member of the NYSE, and HTS Independent Network is an introducing broker-dealer that is also registered with the SEC and FINRA. Hilltop also owns 100% of NLC, which operates through its wholly owned subsidiaries, National Lloyds Insurance Company (“NLIC”) and American Summit Insurance Company (“ASIC”). The consolidated financial statements include the accounts of the above-named entities. All significant intercompany transactions and balances have been eliminated. Noncontrolling interests have been recorded for minority ownership in entities that are not wholly owned and are presented in compliance with the provisions of Noncontrolling Interest in Subsidiary Subsections of the Financial Accounting Standards Board (“FASB”) ASC. PlainsCapital also owns 100% of the outstanding common securities of PCC Statutory Trusts I, II, III and IV (the “Trusts”), which are not included in the consolidated financial statements under the requirements of the Variable Interest Entities Subsections of the ASC, because the primary beneficiaries of the Trusts are not within the consolidated group. |
Summary of Significant Accoun35
Summary of Significant Accounting and Reporting (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Summary of Significant Accounting and Reporting Policies | |
Schedule of revisions made to the consolidated statements of cash flows | The following table summarizes the revisions made to the Company’s unaudited consolidated statements of cash flows for the noted periods (in thousands) . Three Months Ended March 31, 2015 Six Months Ended June 30,2015 As Originally Reported As Revised As Originally Reported As Revised Operating Activities Net change in broker-dealer and clearing organization receivables $ $ $ $ Net change in broker-dealer and clearing organization payables Net cash provided by (used in) operating activities Investing Activities Net change in loans Net cash provided by investing activities Financing Activities Net change in deposits Net cash used in financing activities Net change in cash and cash equivalents |
Acquisition (Tables)
Acquisition (Tables) - SWS | 9 Months Ended |
Sep. 30, 2015 | |
Acquisitions | |
Schedule of components of the consideration paid | The components of the consideration paid are shown in the following table (in thousands). Fair value of preliminary consideration paid: Common stock issued $ Cash Fair value of Hilltop’s existing investment in SWS Total preliminary consideration paid $ |
Summary of fair values of the identifiable assets acquired, and liabilities assumed | The resulting fair values of the identifiable assets acquired, and liabilities assumed, of SWS at January 1, 2015 are summarized in the following table (in thousands). Cash and due from banks $ Federal funds sold and securities purchased under agreements to resell Assets segregated for regulatory purposes Securities Non-covered loans, net Broker-dealer and clearing organization receivables Other assets Total identifiable assets acquired Deposits Broker-dealer and clearing organization payables Short-term borrowings Securities sold, not yet purchased, at fair value Notes payable Other liabilities Total liabilities assumed Preliminary estimated bargain purchase gain Less Hilltop existing investment in SWS Net identifiable assets acquired $ |
Schedule of allocation to intangible assets | The allocation to intangible assets is as follows (in thousands). Estimated Useful Gross Intangible Life (Years) Assets Customer relationships $ Core deposits $ |
Schedule of loans acquired in business combination | The following table presents details on acquired loans at the acquisition date (in thousands). Loans, excluding PCI Total PCI Loans Loans Loans Commercial and industrial (1) $ $ $ Real estate Construction and land development Consumer — Total $ $ $ (1) Acquired loans include margin loans to customers and correspondents of $269.4 million associated with acquired broker-dealer operations, none of which are PCI loans. |
Schedule of pro forma results | Three Months Ended Nine Months Ended September 30, 2014 September 30, 2014 Net interest income $ $ Other revenues Net income |
PCI loans | |
Acquisitions | |
Schedule of PCI Loans at acquisition | The following table presents information about the PCI loans at acquisition (in thousands). Contractually required principal and interest payments $ Nonaccretable difference Cash flows expected to be collected Accretable difference Fair value of loans acquired with a deterioration of credit quality $ |
Loans excluding PCI Loans | |
Acquisitions | |
Schedule of acquired loans without credit impairment | The following table presents information about the acquired loans without credit impairment at acquisition (in thousands). Contractually required principal and interest payments $ Contractual cash flows not expected to be collected Fair value at acquisition |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements | |
Schedule of information regarding financial assets and liabilities measured at fair value on a recurring basis | The following tables present information regarding financial assets and liabilities measured at fair value on a recurring basis (in thousands). Level 1 Level 2 Level 3 Total September 30, 2015 Inputs Inputs Inputs Fair Value Trading securities $ $ $ $ Available for sale securities — Loans held for sale — Derivative assets — — MSR asset — — Trading liabilities — Derivative liabilities — — Level 1 Level 2 Level 3 Total December 31, 2014 Inputs Inputs Inputs Fair Value Trading securities $ $ $ — $ Available for sale securities — Loans held for sale — Derivative assets — — MSR asset — — Investment in SWS common stock — — Trading liabilities — — Derivative liabilities — — |
Roll forward for financial instruments measured at fair value using Level 3 inputs | The following tables include a rollforward for those financial instruments measured at fair value using Level 3 inputs (in thousands). Total Gains or Losses (Realized or Unrealized) Balance at Included in Other Beginning of Purchases/ Sales/ Included in Comprehensive Balance at Period Additions Reductions Net Income Income (Loss) End of Period Three months ended September 30, 2015 Trading securities $ $ — $ — $ $ — $ Loans held for sale — MSR asset — — Total $ $ $ $ $ — $ Nine months ended September 30, 2015 Trading securities $ — $ $ $ $ — $ Loans held for sale — MSR asset — — Total $ $ $ $ $ — $ Three months ended September 30, 2014 Available for sale securities $ $ — $ — $ $ $ Loans held for sale — MSR asset — Derivative liabilities — — Total $ $ $ $ $ $ Nine months ended September 30, 2014 Available for sale securities $ $ — $ — $ $ $ Loans held for sale — MSR asset — Derivative liabilities — — Total $ $ $ $ $ $ |
Schedule of significant unobservable inputs used in the fair value measurements | Range Financial instrument Valuation Technique Unobservable Input (Weighted-Average) Trading securities Discounted cash flow Discount rate 8 - 17 % ( 10 %) Loans held for sale Discounted cash flow / Market comparable Projected price 93 - 95 % ( 94 %) MSR asset Discounted cash flow Constant prepayment rate % Discount rate % |
Schedule of changes in fair value for instruments reported at fair value under the Fair Value Option | The following table presents the changes in fair value for instruments that are reported at fair value under the Fair Value Option (in thousands). Three Months Ended September 30, 2015 Three Months Ended September 30, 2014 Other Total Other Total Net Noninterest Changes in Net Noninterest Changes in Gains (Losses) Income Fair Value Gains (Losses) Income Fair Value Loans held for sale $ $ — $ $ $ — $ MSR asset — — Nine Months Ended September 30, 2015 Nine Months Ended September 30, 2014 Other Total Other Total Net Noninterest Changes in Net Noninterest Changes in Gains (Losses) Income Fair Value Gains (Losses) Income Fair Value Loans held for sale $ $ — $ $ $ — $ MSR asset — — |
Schedule of significant unobservable inputs weighted average rates on Impaired Loans | At September 30, 2015 , estimates for these significant unobservable inputs were as follows. PCI Loans PlainsCapital FNB SWS Merger Transaction Merger Weighted average default rate % % % Weighted average loss severity rate % % % Weighted average prepayment speed % % % |
Schedule of information regarding certain assets and liabilities measured at fair value on a non-recurring basis for which a change in fair value has been recorded during reporting periods subsequent to initial recognition | The following table presents information regarding certain assets and liabilities measured at fair value on a non-recurring basis for which a change in fair v alue has been recorded during reporting periods subsequent to initial recognition (in thousands). Total Gains (Losses) for the Total Gains (Losses) for the Level 1 Level 2 Level 3 Total Three Months Ended September 30, Nine Months Ended September 30, September 30, 2015 Inputs Inputs Inputs Fair Value 2015 2014 2015 2014 Non-covered impaired loans $ — $ — $ $ $ $ $ $ Covered impaired loans — — Non-covered other real estate owned — — — — — Covered other real estate owned — — |
Schedule of carrying values and estimated fair values of financial instruments | The following tables present the carrying values and estimated fair values of financial instruments not measured at fair value on either a recurring or non-recurring basis (in thousands). Estimated Fair Value Carrying Level 1 Level 2 Level 3 September 30, 2015 Amount Inputs Inputs Inputs Total Financial assets: Cash and cash equivalents $ $ $ — $ — $ Securities purchased under agreements to resell — — Held to maturity securities — — Loans held for sale — — Non-covered loans, net — Covered loans, net — — Broker-dealer and clearing organization receivables — — FDIC indemnification asset — — Other assets — Financial liabilities: Deposits — — Broker-dealer and clearing organization payables — — Short-term borrowings — — Debt — — Other liabilities — — Estimated Fair Value Carrying Level 1 Level 2 Level 3 December 31, 2014 Amount Inputs Inputs Inputs Total Financial assets: Cash and cash equivalents $ $ $ — $ — $ Held to maturity securities — — Loans held for sale — — Non-covered loans, net — Covered loans, net — — Broker-dealer and clearing organization receivables — — FDIC indemnification asset — — Other assets — Financial liabilities: Deposits — — Broker-dealer and clearing organization payables — — Short-term borrowings — — Debt — — Other liabilities — — |
Securities (Tables)
Securities (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Securities | |
Summary of trading securities | The fair value of trading securities are summarized as follows (in thousands). September 30, December 31, 2015 2014 U.S. Treasury securities $ $ — U.S. government agencies: Bonds — Residential mortgage-backed securities Commercial mortgage-backed securities Collateralized mortgage obligations — Corporate debt securities States and political subdivisions Unit investment trusts — Private-label securitized product — Other Totals $ $ |
Summary of amortized cost and fair value of securities, excluding trading securities | The amortized cost and fair value of available for sale and held to maturity securities are summarized as follows (in thousands). Available for Sale Gross Gross Amortized Unrealized Unrealized September 30, 2015 Cost Gains Losses Fair Value U.S. Treasury securities $ $ $ $ U.S. government agencies: Bonds Residential mortgage-backed securities Commercial mortgage-backed securities Collateralized mortgage obligations Corporate debt securities States and political subdivisions Commercial mortgage-backed securities — Equity securities Totals $ $ $ $ Available for Sale Amortized Unrealized Unrealized December 31, 2014 Cost Gains Losses Fair Value U.S. Treasury securities $ $ $ $ U.S. government agencies: Bonds Residential mortgage-backed securities — Commercial mortgage-backed securities — Collateralized mortgage obligations Corporate debt securities States and political subdivisions Commercial mortgage-backed securities — Equity securities — Totals $ $ $ $ |
Summary of amortized cost and fair value of held to maturity securities | Held to Maturity Amortized Unrealized Unrealized September 30, 2015 Cost Gains Losses Fair Value U.S. Treasury securities $ $ $ — $ U.S. government agencies: Bonds — Residential mortgage-backed securities — Commercial mortgage-backed securities — Collateralized mortgage obligations States and political subdivisions Totals $ $ $ $ Held to Maturity Amortized Unrealized Unrealized December 31, 2014 Cost Gains Losses Fair Value U.S. Treasury securities $ $ — $ $ U.S. government agencies: Residential mortgage-backed securities — Collateralized mortgage obligations — States and political subdivisions Totals $ $ $ $ |
Schedule of information regarding available for sale securities that were in an unrealized loss position | Information regarding available for sale and held to maturity securities that were in an unrealized loss position is shown in the following tables (dollars in thousands). September 30, 2015 December 31, 2014 Number of Unrealized Number of Unrealized Securities Fair Value Losses Securities Fair Value Losses Available for sale U.S. treasury securities: Unrealized loss for less than twelve months $ $ $ $ Unrealized loss for twelve months or longer — — — U.S. government agencies: Bonds: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer Residential mortgage-backed securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer — — — — — — — — — Commercial mortgage-backed securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer — Collateralized mortgage obligations: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer Corporate debt securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer States and political subdivisions: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer Equity securities: Unrealized loss for less than twelve months — — — Unrealized loss for twelve months or longer — — — — — — Total available for sale: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer $ $ $ $ |
Schedule of information regarding held to maturity securities that were in an unrealized loss position | September 30, 2015 December 31, 2014 Number of Unrealized Number of Unrealized Securities Fair Value Losses Securities Fair Value Losses Held to Maturity U.S. treasury securities: Unrealized loss for less than twelve months — $ — $ — $ $ Unrealized loss for twelve months or longer — — — — — — — — — U.S. government agencies: Collateralized mortgage obligations: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer — — — — — — States and political subdivisions: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer — — — — — — Total held to maturity: Unrealized loss for less than twelve months Unrealized loss for twelve months or longer — — — — — — $ $ $ $ |
Schedule of amortized cost and fair value of securities, excluding trading and equity available for sale securities and the available for sale warrant by contractual maturity | The amortized cost and fair value of securities, excluding trading and available for sale equity securities, at September 30, 2015 are shown by contractual maturity below (in thousands). Available for Sale Held to Maturity Amortized Amortized Cost Fair Value Cost Fair Value Due in one year or less $ $ $ $ Due after one year through five years Due after five years through ten years Due after ten years Residential mortgage-backed securities Collateralized mortgage obligations Commercial mortgage-backed securities $ $ $ $ |
Non-Covered Loans and Allowan39
Non-Covered Loans and Allowance for Non-Covered Loan Losses (Tables) - Noncovered | 9 Months Ended |
Sep. 30, 2015 | |
Non-Covered Loans and Allowance for Non-Covered Loan Losses [Line Items] | |
Summary of non-covered loans by portfolio segment | Non-covered loans summarized by portfolio segment are as follows (in thousands). September 30, December 31, 2015 2014 Commercial and industrial (1) $ $ Real estate Construction and land development Consumer Allowance for non-covered loan losses Total non-covered loans, net of allowance $ $ (1) Includes margin loans to customers and correspondents of $606.0 million and $378.4 million at September 30, 2015 and December 31, 2014 , respectively. |
Schedule of carrying values and the outstanding balances of the PCI loans | The following table presents the carrying values and the outstanding balances of the non-covered PCI loans (in thousands). September 30, December 31, 2015 2014 Carrying amount $ $ Outstanding balance |
Schedule of changes in the accretable yield for the PCI loans | Changes in the accretable yield for the non-covered PCI loans were as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions — — — Reclassifications from (to) nonaccretable difference, net (1) Disposals of loans — Accretion Balance, end of period $ $ $ $ (1) Reclassifications from nonaccretable difference are primarily due to net increases in expected cash flows in the quarterly recasts. Reclassifications to nonaccretable difference occur when accruing loans are moved to nonaccrual and expected cash flows are no longer predictable and the accretable yield is eliminated. |
Summary of PCI loans by class | Non-covered impaired loans are summarized by class in the following tables (in thousands). Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related September 30, 2015 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured — — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development Consumer $ $ $ $ $ Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related December 31, 2014 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — — — — Commercial construction loans and land development Consumer $ $ $ $ $ |
Summary of average investment in PCI loans by class | Average investment in non-covered impaired loans is summarized by class in the following table (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Commercial and industrial: Secured $ $ $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development Consumer $ $ $ $ |
Summary of non-accrual loans by class | Non-covered non-accrual loans, excluding those classified as held for sale, are summarized by class in the following table (in thousands). September 30, December 31, 2015 2014 Commercial and industrial: Secured $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development Consumer — $ $ |
Schedule of information regarding TDRs granted | Recorded Investment in Loans Modified by Interest Rate Payment Term Total Three months ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ $ Unsecured — — — — Real estate: Secured by commercial properties — — Secured by residential properties — — — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ — $ — $ $ Recorded Investment in Loans Modified by Interest Rate Payment Term Total Nine months ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ $ Unsecured — — — — Real estate: Secured by commercial properties — — Secured by residential properties — — — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ — $ — $ $ Recorded Investment in Loans Modified by Interest Rate Payment Term Total Nine months ended September 30, 2014 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ — $ — Unsecured — — — — Real estate: Secured by commercial properties — — Secured by residential properties — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — Consumer — — — — $ — $ — $ $ The following table presents information regarding TDRs granted in the three and nine months ended September 30, 2015 for which a payment was at least 30 days past due in the three and nine months ended September 30, 2015 (dollars in thousands). Number of Recorded Loans Investment Commercial and industrial: Secured — $ — Unsecured — — Real estate: Secured by commercial properties Secured by residential properties — — Construction and land development: Residential construction loans — — Commercial construction loans and land development — — Consumer — — $ |
Schedule of analysis of the aging of the entity's loan portfolio | An analysis of the aging of the Bank’s non-covered loan portfolio is shown in the following tables (in thousands). Accruing Loans (Non-PCI) Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total Past Due September 30, 2015 30-59 Days 60-89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ $ $ $ $ $ $ $ Unsecured — — Real estate: Secured by commercial properties — — — Secured by residential properties Construction and land development: Residential construction loans — — — — — Commercial construction loans and land development — — Consumer — — $ $ $ $ $ $ $ $ Accruing Loans (Non-PCI) Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total Past Due December 31, 2014 30-59 Days 60-89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ $ $ $ $ $ $ $ — Unsecured — — Real estate: Secured by commercial properties — — — Secured by residential properties — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — Consumer — — $ $ $ $ $ $ $ $ — |
Schedule of internal risk grades of loans by class | The following tables present the internal risk grades of non-covered loans, as previously described, in the portfolio by class (in thousands). September 30, 2015 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ $ $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties — Construction and land development: Residential construction loans — — Commercial construction loans and land development — Consumer — $ $ $ $ $ December 31, 2014 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ $ $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties — Construction and land development: Residential construction loans — — — Commercial construction loans and land development — Consumer — $ $ $ $ $ |
Schedule of changes in the allowance for loan losses by portfolio segment | Changes in the allowance for non-covered loan losses, distributed by portfolio segment, are shown below (in thousands). Commercial and Construction and Three Months Ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to (recapture from) operations Loans charged off — Recoveries on charged off loans — Balance, end of period $ $ $ $ $ Commercial and Construction and Nine Months Ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to (recapture from) operations Loans charged off — Recoveries on charged off loans — Balance, end of period $ $ $ $ $ Commercial and Construction and Three Months Ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to operations Loans charged off — Recoveries on charged off loans Balance, end of period $ $ $ $ $ Commercial and Construction and Nine Months Ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ $ Provision charged to operations Loans charged off — Recoveries on charged off loans Balance, end of period $ $ $ $ $ |
Schedule of loan portfolio distributed by portfolio segment and impairment methodology | The non-covered loan portfolio was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ $ — $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ $ $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ |
Schedule of allowance for loan losses distributed by portfolio segment and impairment methodology | The allowance for non-covered loan losses was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ — $ — $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ $ — $ — $ — $ Loans collectively evaluated for impairment PCI Loans $ $ $ $ $ |
Covered Assets and Indemnific40
Covered Assets and Indemnification Asset (Tables) - Covered | 9 Months Ended |
Sep. 30, 2015 | |
Loans | |
Summary of carrying value of the loans | The following table presents the carrying value of the covered loans summarized by portfolio segment (in thousands). September 30, December 31, 2015 2014 Commercial and industrial $ $ Real estate Construction and land development Consumer — — Allowance for covered loans Total covered loans, net of allowance $ $ |
Schedule of carrying value and the outstanding balance of the PCI loans | The following table presents the carrying value and the outstanding contractual balance of the covered PCI loans (in thousands). September 30, December 31, 2015 2014 Carrying amount $ $ Outstanding balance |
Schedule of changes in the accretable yield for the PCI loans | Changes in the accretable yield for the covered PCI loans were as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Reclassifications from (to) nonaccretable difference, net (1) Transfer of loans to covered OREO (2) Accretion Balance, end of period $ $ $ $ (1) Reclassifications from nonaccretable difference are primarily due to net increases in expected cash flows in the quarterly recasts , but may also include the reclassification and immediate income recognition of nonaccretable difference due to the favorable resolution of loans accounted for individually . Reclassifications to nonaccretable difference occur when accruing loans are moved to nonaccrual and expected cash flows are no longer predictable and the accretable yield is eliminated. (2) Transfer of loans to covered OREO is the difference between the value removed from the pool and the expected cash flows for the loan. |
Summary of PCI loans by class | Covered impaired loans are summarized by class in the following tables (in thousands). Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related September 30, 2015 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured — — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development Consumer — — — — — $ $ $ $ $ Unpaid Recorded Recorded Total Contractual Investment with Investment with Recorded Related December 31, 2014 Principal Balance No Allowance Allowance Investment Allowance Commercial and industrial: Secured $ $ $ $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development — — Consumer — — — — — $ $ $ $ $ |
Summary of average investment in PCI loans by class | Average investment in covered impaired loans is summarized by class in the following table (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Commercial and industrial: Secured $ $ $ $ Unsecured Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development Consumer — — — — $ $ $ $ |
Summary of non-accrual loans by class | Covered non-accrual loans are summarized by class in the following table (in thousands). September 30, December 31, 2015 2014 Commercial and industrial: Secured $ $ Unsecured — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans Commercial construction loans and land development Consumer — — $ $ |
Schedule of information regarding TDRs granted | Recorded Investment in Loans Modified by Interest Rate Payment Term Total Three Months Ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ — $ — Unsecured — — — — Real estate: Secured by commercial properties — — — — Secured by residential properties — — Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ — $ $ — $ Recorded Investment in Loans Modified by Interest Rate Payment Term Total Nine Months Ended September 30, 2015 A/B Note Adjustment Extension Modification Commercial and industrial: Secured $ — $ — $ — $ — Unsecured — — — — Real estate: Secured by commercial properties — — — — Secured by residential properties Construction and land development: Residential construction loans — — — — Commercial construction loans and land development — — — — Consumer — — — — $ $ $ $ The following table presents information regarding TDRs granted in the three and nine months ended September 30, 2015 for which a payment was at least 30 days past due in the three and nine months ended September 30, 2015 (dollars in thousands). Number of Recorded Loans Investment Commercial and industrial: Secured — $ — Unsecured — — Real estate: Secured by commercial properties — Secured by residential properties Construction and land development: Residential construction loans — — Commercial construction loans and land development — — Consumer — — $ |
Schedule of analysis of the aging of the entity's loan portfolio | An analysis of the aging of the Bank’s covered loan portfolio is shown in the following tables (in thousands). Accruing Loans Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total (Non ‑ PCI) Past Due September 30, 2015 30 ‑ 59 Days 60 ‑ 89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ $ — $ $ $ $ $ $ — Unsecured — — — — — — Real estate: Secured by commercial properties Secured by residential properties Construction and land development: Residential construction loans — — — Commercial construction loans and land development — Consumer — — — — — — — — $ $ $ $ $ $ $ $ Accruing Loans Loans Past Due Loans Past Due Loans Past Due Total Current PCI Total (Non ‑ PCI) Past Due December 31, 2014 30 ‑ 59 Days 60 ‑ 89 Days 90 Days or More Past Due Loans Loans Loans Loans 90 Days or More Commercial and industrial: Secured $ — $ — $ $ $ $ $ $ Unsecured — — — Real estate: Secured by commercial properties — — Secured by residential properties Construction and land development: Residential construction loans — — — Commercial construction loans and land development Consumer — — — — — — — — $ $ $ $ $ $ $ $ |
Schedule of internal risk grades of loans | The following tables present the internal risk grades of covered loans in the portfolio by class (in thousands). September 30, 2015 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ — $ $ $ Unsecured — — — Real estate: Secured by commercial properties — Secured by residential properties Construction and land development: Residential construction loans — Commercial construction loans and land development — Consumer — — — — — $ $ $ $ $ December 31, 2014 Pass Special Mention Substandard PCI Total Commercial and industrial: Secured $ $ — $ $ $ Unsecured — — Real estate: Secured by commercial properties — Secured by residential properties — Construction and land development: Residential construction loans — Commercial construction loans and land development — Consumer — — — — — $ $ — $ $ $ |
Schedule of changes in the allowance for loan losses by portfolio segment | Changes in the allowance for covered loan losses, distributed by portfolio segment, are shown below (in thousands). Commercial and Construction and Three months ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ — $ Provision charged to (recapture from) operations — Loans charged off — — Recoveries on charged off loans — — Balance, end of period $ $ $ $ — $ Commercial and Construction and Nine months ended September 30, 2015 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ — $ Provision charged to (recapture from) operations — Loans charged off — Recoveries on charged off loans — — Balance, end of period $ $ $ $ — $ Commercial and Construction and Three months ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ $ — $ Provision charged to (recapture from) operations — Loans charged off — — Recoveries on charged off loans — — — — — Balance, end of period $ $ $ $ — $ Commercial and Construction and Nine months ended September 30, 2014 Industrial Real Estate Land Development Consumer Total Balance, beginning of period $ $ $ — $ — $ Provision charged to (recapture from) operations — Loans charged off — Recoveries on charged off loans — — — — — Balance, end of period $ $ $ $ — $ |
Schedule of loan portfolio distributed by portfolio segment and impairment methodology | The covered loan portfolio was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ $ — $ Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ $ — $ Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ |
Schedule of allowance for loan losses distributed by portfolio segment and impairment methodology | The allowance for covered loan losses was distributed by portfolio segment and impairment methodology as shown below (in thousands). Commercial and Construction and September 30, 2015 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ — $ — $ — Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ Commercial and Construction and December 31, 2014 Industrial Real Estate Land Development Consumer Total Loans individually evaluated for impairment $ — $ — $ — $ — $ — Loans collectively evaluated for impairment — PCI Loans — $ $ $ $ — $ |
Summary of the activity in covered OREO | A summary of the activity in covered OREO is as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions to covered OREO Dispositions of covered OREO Valuation adjustments in the period Balance, end of period $ $ $ $ |
Summary of the activity in the FDIC Indemnification Asset | A summary of the activity in the FDIC Indemnification Asset is as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ FDIC Indemnification Asset accretion (amortization) Transfers to due from FDIC and other Balance, end of period $ $ $ $ |
Mortgage Servicing Rights (Tabl
Mortgage Servicing Rights (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Mortgage Servicing Rights | |
Schedule of change in fair value of the Company's MSR asset, as included in other assets within the consolidated balance sheets | The following tables present the changes in fair value of the Company’s MSR asset, as included in other assets within the consolidated balance sheets, and other information related to the serviced portfolio (dollars in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions Sales — — Changes in fair value: Due to changes in model inputs or assumptions (1) Due to customer payments Balance, end of period $ $ $ $ September 30, December 31, 2015 2014 Mortgage loans serviced for others $ $ MSR asset as a percentage of serviced mortgage loans % % (1) Primarily represents changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates and the refinement of other MSR model assumptions. |
Schedule of key assumptions used in measuring the fair value of the Company's MSR | September 30, December 31, 2015 2014 Weighted average constant prepayment rate % % Weighted average discount rate % % Weighted average life (in years) |
Schedule of sensitivity analysis of fair value of the Company's MSR to certain key assumptions | A sensitivity analysis of the fair value of the Company’s MSR asset to certain key assumptions is presented in the following table (in thousands). September 30, December 31, 2015 2014 Constant prepayment rate: Impact of 10% adverse change $ $ Impact of 20% adverse change Discount rate: Impact of 10% adverse change Impact of 20% adverse change |
Deposits (Tables)
Deposits (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Deposits | |
Summary of deposits | Deposits are summarized as follows (in thousands). September 30, December 31, 2015 2014 Noninterest-bearing demand $ $ Interest-bearing: NOW accounts Money market Brokered - money market Demand Savings Time Brokered - time $ $ |
Short-term Borrowings (Tables)
Short-term Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Short-term borrowings | |
Schedule of short-term borrowings | Short-term borrowings are summarized as follows (in thousands). September 30, December 31, 2015 2014 Federal funds purchased $ $ Securities sold under agreements to repurchase Federal Home Loan Bank notes Short-term bank loans $ $ |
Schedule of federal funds purchased and securities sold under agreements to repurchase | |
Short-term borrowings | |
Schedule of short-term borrowings | Information concerning federal funds purchased and securities sold under agreements to repurchase is shown in the following tables (dollars in thousands). Nine Months Ended September 30, 2015 2014 Average balance during the period $ $ Average interest rate during the period % % September 30, December 31, 2015 2014 Average interest rate at end of period % % Securities underlying the agreements at end of period: Carrying value $ $ Estimated fair value $ $ |
Federal Home Loan Bank notes | |
Short-term borrowings | |
Schedule of short-term borrowings | Other information regarding FHLB notes is shown in the following tables (dollars in thousands). Nine Months Ended September 30, 2015 2014 Average balance during the period $ $ Average interest rate during the period % % September 30, December 31, 2015 2014 Average interest rate at end of period % % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies | |
Schedule of roll-forward of claims activity for loans put-back to the mortgage origination segment | The following tables provide for a rollforward of claims activity for loans put-back to the mortgage origination segment based upon an alleged breach of a representation or warranty with respect to a loan sold and related indemnification liability reserve activity (in thousands). Representation and Warranty Specific Claims Activity - Origination Loan Balance Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Claims made Claims resolved with no payment Repurchases Indemnification payments Balance, end of period $ $ $ $ Indemnification Liability Reserve Activity Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Balance, beginning of period $ $ $ $ Additions for new sales Repurchases Early payment defaults Indemnification payments Change in estimate Balance, end of period $ $ $ $ September 30, December 31, 2015 2014 Reserve for Indemnification Liability: Specific claims $ $ Incurred but not reported claims Total $ $ |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Regulatory Matters | |
Schedule of comparison of the Bank's and Hilltop's consolidated actual capital amounts and ratios to the regulatory minimum requirements and the Bank's regulatory minimum capital requirements and the Bank's regulatory minimum capital requirements needed to qualify as a well-capitalized institution without giving effect to the final Basel III capital rules adopted by the Federal Reserve Board | The following table shows the Bank’s and Hilltop’s consolidated actual capital amounts and ratios compared to the regulatory minimum capital requirements and the Bank’s regulatory minimum capital requirements needed to qualify as a “well-capitalized” institution in accordance with Basel III as measured at September 30, 2015 and applicable regulatory guidelines at December 31, 2014 (dollars in thousands). To Be Well Capitalized Minimum Capital Minimum Capital Actual Requirements Requirements Amount Ratio Amount Ratio Amount Ratio September 30, 2015 Tier 1 capital (to average assets): Bank $ % $ % $ % Hilltop % % N/A N/A Common equity Tier 1 capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A Tier 1 capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A Total capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A December 31, 2014 Tier 1 capital (to average assets): Bank $ % $ % $ % Hilltop % % N/A N/A Tier 1 capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A Total capital (to risk-weighted assets): Bank % % % Hilltop % % N/A N/A |
Summary of minimum required capital amounts and ratios for the well capitalized category | At September 30, 2015 , the net capital position of each of the Hilltop Broker-Dealers was as follows (in thousands). HTS Hilltop Independent FSC Securities Network Net capital $ $ $ Less required net capital Excess net capital $ $ $ Net capital as a percentage of aggregate debit items % % Net capital in excess of 5% aggregate debit items $ $ |
Summary of statutory capital and surplus and statutory net income of each insurance subsidiary | A summary of statutory capital and surplus and statutory net income (loss) of each insurance subsidiary is as follows (in thousands). September 30, December 31, 2015 2014 Capital and surplus: National Lloyds Insurance Company $ $ American Summit Insurance Company Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Statutory net income (loss): National Lloyds Insurance Company $ $ $ $ American Summit Insurance Company |
Derivative Financial Instrume46
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Financial Instruments | |
Schedule of derivative positions | Derivative positions are presented in the following table (in thousands). September 30, 2015 December 31, 2014 Notional Estimated Notional Estimated Amount Fair Value Amount Fair Value Derivative instruments: IRLCs $ $ $ $ Commitments to purchase MBSs Commitments to sell MBSs Interest rate swaps and swaptions |
Balance Sheet Offsetting (Table
Balance Sheet Offsetting (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Balance Sheet Offsetting | |
Schedule of the assets subject to an enforceable master netting arrangement or repurchase agreements | The following tables present the assets and liabilities subject to enforceable master netting arrangements, repurchase agreements, or similar agreements with offsetting rights (in thousands). Gross Amounts Not Offset in Net Amounts the Balance Sheet Gross Amounts Gross Amounts of Assets Cash of Recognized Offset in the Presented in the Financial Collateral Net Assets Balance Sheet Balance Sheet Instruments Pledged Amount September 30, 2015 Securities borrowed: Institutional counterparties $ $ — $ $ $ — $ — Interest rate swaps and swaptions: Institutional counterparties — — Reverse repurchase agreements: Institutional counterparties — — Forward MBS derivatives: Institutional counterparties — — — $ $ $ $ $ — $ December 31, 2014 Securities borrowed: Institutional counterparties $ $ — $ $ $ — $ — Interest rate swaps and swaptions: Institutional counterparties — — — Forward MBS derivatives: Institutional counterparties — — — $ $ — $ $ $ — $ |
Schedule of the liabilities subject to an enforceable master netting arrangement or repurchase agreements | Gross Amounts Not Offset in Net Amounts the Balance Sheet Gross Amounts Gross Amounts of Liabilities Cash of Recognized Offset in the Presented in the Financial Collateral Net Liabilities Balance Sheet Balance Sheet Instruments Pledged Amount September 30, 2015 Securities loaned: Institutional counterparties $ $ — $ $ $ — $ — Interest rate swaps and swaptions: Institutional counterparties — — Repurchase agreements: Institutional counterparties — — — Customer counterparties — — — Forward MBS derivatives: Institutional counterparties — $ $ $ $ $ — $ December 31, 2014 Securities loaned: Institutional counterparties $ $ — $ $ $ — $ — Repurchase agreements: Customer counterparties — — — Forward MBS derivatives: Institutional counterparties — $ $ $ $ $ $ |
Schedule of contractual maturities of repurchase agreements and secured borrowing transactions | The following tables present the remaining contractual maturities of repurchase agreement and securities lending transactions accounted for as secured borrowings (in thousands). The Company had no repurchase-to-maturity transactions outstanding at September 30, 2015 or December 31, 2014 . Remaining Contractual Maturities Overnight and Greater Than September 30, 2015 Continuous Up to 30 Days 30-90 Days 90 Days Total Repurchase agreement transactions: U.S. Treasury and agency securities $ $ $ $ — $ Securities lending transactions: U.S. Treasury and agency securities — — — Corporate securities — — — Equity securities — — — Total $ $ $ $ — $ Gross amount of recognized liabilities for repurchase agreement and securities lending transactions in offsetting disclosure above $ Amount related to agreements not included in offsetting disclosure above $ — Remaining Contractual Maturities Overnight and Greater Than December 31, 2014 Continuous Up to 30 Days 30-90 Days 90 Days Total Repurchase agreement transactions: U.S. Treasury and agency securities $ $ — $ — $ — $ Securities lending transactions: U.S. Treasury and agency securities — — — Corporate securities — — — Equity securities — — — Total $ $ — $ — $ — $ Gross amount of recognized liabilities for repurchase agreement and securities lending transactions in offsetting disclosure above $ Amount related to agreements not included in offsetting disclosure above $ — |
Broker-Dealer and Clearing Or48
Broker-Dealer and Clearing Organization Receivables and Payables (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Broker-Dealer and Clearing Organization Receivables and Payables | |
Schedule of broker-dealer and clearing organization receivables and payables | Broker-dealer and clearing organization receivables and payables consisted of the following (in thousands). September 30, December 31, 2015 2014 Receivables: Securities borrowed $ $ Securities failed to deliver Clearing organizations Trades in process of settlement, net — Other $ $ Payables: Securities loaned $ $ Correspondents Securities failed to receive Clearing organizations $ $ |
Reserves for Losses and Loss 49
Reserves for Losses and Loss Adjustment Expenses (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Reserves for Losses and Loss Adjustment Expenses | |
Schedule of information regarding the reserve for unpaid losses and loss adjustment expenses ("LAE") as included in other liabilities within the consolidated balance sheets | A rollforward of NLC’s reserve for unpaid losses and loss adjustment expenses (“LAE”), as included in other liabilities within the consolidated balance sheets, is as follows (in thousands). Nine Months Ended September 30, 2015 2014 Balance, beginning of period $ $ Less reinsurance recoverables Net balance, beginning of period Incurred related to: Current year Prior years Total incurred Payments related to: Current year Prior years Total payments Net balance, end of period Plus reinsurance recoverables Balance, end of period $ $ |
Reinsurance Activity (Tables)
Reinsurance Activity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Reinsurance Activity | |
Schedule of effects of reinsurance on premiums written and earned | The effects of reinsurance on premiums written and earned are summarized as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Written Earned Written Earned Written Earned Written Earned Premiums from direct business $ $ $ $ $ $ $ $ Reinsurance assumed Reinsurance ceded Net premiums $ $ $ $ $ $ $ $ |
Schedule of effects of reinsurance on incurred losses | The effects of reinsurance on incurred losses are as follows (in thousands). Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Loss and LAE incurred $ $ $ $ Reinsurance recoverables Net loss and LAE incurred $ $ $ $ |
Segment and Related Informati51
Segment and Related Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment and Related Information | |
Schedule of information about the segment revenues, operating results, goodwill, and assets of entity's reportable segments | The following tables present certain information about reportable business segment revenues, operating results, goodwill and assets (in thousands). Mortgage All Other and Hilltop Three Months Ended September 30, 2015 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income — Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ Mortgage All Other and Hilltop Nine Months Ended September 30, 2015 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ Mortgage All Other and Hilltop Three Months Ended September 30, 2014 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income — Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ Mortgage All Other and Hilltop Nine Months Ended September 30, 2014 Banking Broker-Dealer Origination Insurance Corporate Eliminations Consolidated Net interest income (expense) $ $ $ $ $ $ $ Provision for loan losses — — — — Noninterest income — Noninterest expense Income (loss) before income taxes $ $ $ $ $ $ $ September 30, 2015 Goodwill $ $ $ $ $ — $ — $ Total assets $ $ $ $ $ $ $ December 31, 2014 Goodwill $ $ $ $ $ — $ — $ Total assets $ $ $ $ $ $ $ |
Earnings per Common Share (Tabl
Earnings per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings per Common Share | |
Schedule of the computation of basic and diluted earnings per common share | The following table presents the computation of basic and diluted earnings per common share (in thousands, except per share data) . Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Basic earnings per share: Income applicable to Hilltop common stockholders $ $ $ $ Less: income applicable to participating shares Net earnings available to Hilltop common stockholders $ $ $ $ Weighted average shares outstanding - basic Basic earnings per common share $ $ $ $ Diluted earnings per share: Income applicable to Hilltop common stockholders $ $ $ $ Weighted average shares outstanding - basic Effect of potentially dilutive securities Weighted average shares outstanding - diluted Diluted earnings per common share $ $ $ $ |
Summary of Significant Accoun53
Summary of Significant Accounting and Reporting Policies - Nature of Operations (Details) $ / shares in Units, $ in Thousands, shares in Millions | Jan. 01, 2015USD ($)$ / sharesshares | Sep. 30, 2015item |
Business Acquisition [Line Items] | ||
Number of primary operating business units | item | 3 | |
SWS | ||
Business Combination, Description [Abstract] | ||
Conversion of common stock | 0.2496 | |
Cash consideration paid per share | $ / shares | $ 1.94 | |
Acquisition price (in dollars per share) | $ / shares | $ 6.92 | |
Aggregate purchase price | $ 349,125 | |
Aggregate purchase price, stock issued | shares | 10.1 | |
Aggregate purchase price, cash | $ 78,217 | |
Aggregate purchase price, existing investment | 70,282 | |
Fair Value of Assets Acquired | ||
Fair value of assets acquired | 3,298,659 | |
Securities | 707,476 | |
Non-covered loans, net | 863,819 | |
Broker-dealer and clearing organization receivables | 1,221,793 | |
Fair Value of Liabilities Assumed | ||
Fair value of liabilities assumed | 2,868,245 | |
Deposits | 1,287,509 | |
Broker-dealer and clearing organization payables | $ 1,109,978 |
Summary of Significant Accoun54
Summary of Significant Accounting and Reporting Policies - Basis of Presentation (Details) - USD ($) $ in Thousands | Jan. 01, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 |
Error Corrections and Prior Period Adjustments Restatement | ||||||
Bargain purchase gain | $ 81,289 | |||||
Operating Activities | ||||||
Net change in broker-dealer and clearing organization receivables | $ (793,613) | $ (660,121) | (680,699) | $ (164,497) | ||
Net change in broker-dealer and clearing organization payables | 690,552 | 672,259 | 708,838 | 261,206 | ||
Net cash provided by (used in) operating activities | (118,644) | (53,338) | (1,646) | (50,008) | ||
Investing Activities | ||||||
Net change in loans | (2,080) | (24,674) | 16,205 | 106,335 | ||
Net cash provided by investing activities | 522,912 | 467,936 | 581,624 | 84,075 | ||
Financing Activities | ||||||
Net change in deposits | (556,657) | (774,068) | (788,907) | (633,685) | ||
Net cash used in financing activities | (508,810) | (621,816) | (841,500) | (132,502) | ||
Net change in cash and cash equivalents | (104,542) | $ (207,218) | $ (261,522) | $ (98,435) | ||
Scenario, Previously Reported | ||||||
Operating Activities | ||||||
Net change in broker-dealer and clearing organization receivables | $ (929,477) | (1,062,969) | ||||
Net change in broker-dealer and clearing organization payables | 1,021,493 | 1,039,786 | ||||
Net cash provided by (used in) operating activities | 26,540 | (38,766) | ||||
Investing Activities | ||||||
Net change in loans | 244,681 | 267,275 | ||||
Net cash provided by investing activities | 737,291 | 792,267 | ||||
Financing Activities | ||||||
Net change in deposits | (1,123,301) | (905,043) | ||||
Net cash used in financing activities | (971,049) | (858,043) | ||||
Net change in cash and cash equivalents | $ (207,218) | (104,542) | ||||
SWS | ||||||
Error Corrections and Prior Period Adjustments Restatement | ||||||
Bargain purchase gain | $ 81,289 | |||||
SWS | Scenario, Previously Reported | ||||||
Error Corrections and Prior Period Adjustments Restatement | ||||||
Bargain purchase gain | 82,800 | |||||
SWS | Restatement Adjustment | ||||||
Error Corrections and Prior Period Adjustments Restatement | ||||||
Bargain purchase gain | $ (1,500) |
Summary of Significant Accoun55
Summary of Significant Accounting and Reporting Policies - Basis of Presentation, additional info. (Details) | 9 Months Ended |
Sep. 30, 2015 | |
Plains Capital | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by the reporting entity | 100.00% |
Bank | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by subsidiary of the reporting entity | 100.00% |
Plains Capital Equity LLC | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by subsidiary of the reporting entity | 100.00% |
Prime Lending | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by subsidiary of the reporting entity | 100.00% |
Plains Capital Securities LLC | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by subsidiary of the reporting entity | 100.00% |
Securities Holdings | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by the reporting entity | 100.00% |
NLC | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by the reporting entity | 100.00% |
Prime Lending Ventures Management LLC | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by subsidiary of the reporting entity | 100.00% |
PCC Statutory Trusts | |
Basis of Presentation | |
Ownership percentage of subsidiary owned by subsidiary of the reporting entity | 100.00% |
Acquisition - Consideration Pai
Acquisition - Consideration Paid (Details) - USD ($) $ in Thousands | Jan. 01, 2015 | Sep. 30, 2015 |
Business Acquisition [Line Items] | ||
Preliminary bargain purchase gain | $ 81,289 | |
SWS | ||
Business Acquisition [Line Items] | ||
Preliminary bargain purchase gain | $ 81,289 | |
Fair value of preliminary consideration paid: | ||
Common stock issued | 200,626 | |
Cash | 78,217 | |
Fair value of Hilltop existing investment in SWS | 70,282 | |
Total preliminary consideration paid | $ 349,125 |
Acquisition - Identifiable Asse
Acquisition - Identifiable Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Jan. 01, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Fair values of the identifiable assets acquired, and liabilities assumed | |||||
Bargain purchase gain | $ (81,289) | ||||
SWS | |||||
Fair values of the identifiable assets acquired, and liabilities assumed | |||||
Cash and due from banks | $ 119,314 | ||||
Federal funds sold and securities purchased under agreements to resell | 44,741 | ||||
Assets segregated for regulatory purposes | 181,610 | ||||
Securities | 707,476 | ||||
Non-covered loans, net | 863,819 | ||||
Broker-dealer and clearing organization receivables | 1,221,793 | ||||
Other assets | 159,906 | ||||
Total identifiable assets acquired | 3,298,659 | ||||
Deposits | (1,287,509) | ||||
Broker-dealer and clearing organization payables | (1,109,978) | ||||
Short-term borrowings | (164,240) | ||||
Securities sold, not yet purchased, at fair value | (140,409) | ||||
Notes payable | (76,643) | ||||
Other liabilities | (89,466) | ||||
Total liabilities assumed | (2,868,245) | ||||
Bargain purchase gain | (81,289) | ||||
Net identifiable assets acquire, including investment in SWS | 349,125 | ||||
Less Hilltop existing investment in SWS | (70,282) | ||||
Net identifiable assets acquired | 278,843 | ||||
Tax on bargain purchase gain | 0 | 0 | |||
Allocation to intangible assets | |||||
Gross Intangible Assets | $ 7,460 | ||||
Transaction and integration related expenses | $ 2,800 | $ 300 | $ 17,200 | $ 700 | |
Customer Relationships | |||||
Allocation to intangible assets | |||||
Estimated Useful Life | 14 years | ||||
Customer Relationships | SWS | |||||
Allocation to intangible assets | |||||
Gross Intangible Assets | $ 7,300 | ||||
Core deposits | |||||
Allocation to intangible assets | |||||
Estimated Useful Life | 4 years | ||||
Core deposits | SWS | |||||
Allocation to intangible assets | |||||
Gross Intangible Assets | $ 160 |
Acquisition - Acquired Loans at
Acquisition - Acquired Loans at Acquisition Date (Details) - SWS $ in Thousands | Jan. 01, 2015USD ($) |
Information about the acquired loans at acquisition | |
Carryover of Allowance for Loan and Lease Losses, Loans Acquired | $ 0 |
Total loans | 863,819 |
Commercial and industrial | |
Information about the acquired loans at acquisition | |
Total loans | 457,809 |
Real estate | |
Information about the acquired loans at acquisition | |
Total loans | 386,695 |
Construction and land development | |
Information about the acquired loans at acquisition | |
Total loans | 16,099 |
Consumer | |
Information about the acquired loans at acquisition | |
Total loans | 3,216 |
Loans excluding PCI Loans | |
Information about the acquired loans at acquisition | |
Total loans | 790,360 |
Loans excluding PCI Loans | Commercial and industrial | |
Information about the acquired loans at acquisition | |
Total loans | 447,959 |
Margin loans to customers and correspondents | 269,400 |
Loans excluding PCI Loans | Real estate | |
Information about the acquired loans at acquisition | |
Total loans | 324,477 |
Loans excluding PCI Loans | Construction and land development | |
Information about the acquired loans at acquisition | |
Total loans | 14,708 |
Loans excluding PCI Loans | Consumer | |
Information about the acquired loans at acquisition | |
Total loans | 3,216 |
PCI loans | |
Information about the acquired loans at acquisition | |
Total loans | 73,459 |
PCI loans | Commercial and industrial | |
Information about the acquired loans at acquisition | |
Total loans | 9,850 |
PCI loans | Real estate | |
Information about the acquired loans at acquisition | |
Total loans | 62,218 |
PCI loans | Construction and land development | |
Information about the acquired loans at acquisition | |
Total loans | $ 1,391 |
Acquisition - Loans at Acquisit
Acquisition - Loans at Acquisition, Additional Info. and Pro Forma Results (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2014 | Jan. 01, 2015 | |
Pro Forma Results of Operations | |||
Net interest income | $ 106,593 | $ 322,231 | |
Other revenues | 262,960 | 743,812 | |
Net income | $ 31,636 | $ 87,785 | |
SWS | |||
Acquisitions | |||
Total loans | $ 863,819 | ||
SWS | PCI loans | |||
Acquisitions | |||
Contractually required principal and interest payments | 120,078 | ||
Nonaccretable difference | 32,040 | ||
Cash flows expected to be collected | 88,038 | ||
Accretable difference | 14,579 | ||
Total loans | 73,459 | ||
SWS | Loans excluding PCI Loans | |||
Acquisitions | |||
Contractually required principal and interest payments | 901,672 | ||
Contractual cash flows not expected to be collected | 39,721 | ||
Total loans | $ 790,360 |
Fair Value Measurements - FV Op
Fair Value Measurements - FV Option (Details) - USD ($) $ / shares in Units, $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 | Oct. 02, 2014 |
Fair value measurements | |||
Mortgage loans held for sale, fair value | $ 1,310 | $ 1,270 | |
Mortgage loans held for sale, unpaid principal balance | $ 1,250 | $ 1,220 | |
SWS | |||
Fair value measurements | |||
Number of shares of common stock available to purchase under warrant | 8,695,652 | ||
Warrants exercise price (in dollars per share) | $ 5.75 | ||
Aggregate principal amount of senior unsecured loan | $ 50 | ||
Percentage of outstanding shares of SWS common stock | 21.00% |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Financial assets: | ||
Trading securities | $ 292,418 | $ 65,717 |
Available for sale securities | 726,132 | 925,535 |
Recurring | ||
Financial assets: | ||
Trading securities | 292,418 | 65,717 |
Available for sale securities | 726,132 | 925,535 |
Loans held for sale | 1,305,654 | 1,272,152 |
Derivative assets | 77,587 | 23,805 |
Mortgage servicing asset | 47,527 | 36,155 |
Investment in SWS common stock | 70,282 | |
Financial liabilities: | ||
Trading liabilities | 156,775 | 48 |
Derivative liabilities | 42,340 | 12,849 |
Recurring | Level 1 | ||
Financial assets: | ||
Trading securities | 9,748 | 39 |
Available for sale securities | 17,456 | 13,762 |
Investment in SWS common stock | 70,282 | |
Financial liabilities: | ||
Trading liabilities | 41,792 | |
Recurring | Level 2 | ||
Financial assets: | ||
Trading securities | 282,669 | 65,678 |
Available for sale securities | 708,676 | 911,773 |
Loans held for sale | 1,278,950 | 1,263,135 |
Derivative assets | 77,587 | 23,805 |
Financial liabilities: | ||
Trading liabilities | 114,983 | 48 |
Derivative liabilities | 42,340 | 12,849 |
Recurring | Level 3 | ||
Financial assets: | ||
Trading securities | 1 | |
Loans held for sale | 26,704 | 9,017 |
Mortgage servicing asset | $ 47,527 | $ 36,155 |
Fair Value Measurements - Roll
Fair Value Measurements - Roll Forward, Level 3 (Details) - Level 3 - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Rollforward for financial instruments measured at fair value using Level 3 inputs | ||||
Net asset (liability) balance, beginning of period | $ 64,124 | $ 103,805 | $ 45,172 | $ 102,331 |
Purchases/Additions | 22,491 | 24,915 | 70,497 | 50,144 |
Sales/Reductions | (2,769) | (12,987) | (15,890) | (42,590) |
Total gains or losses (realized or unrealized): | ||||
Included in Net Income (Loss) | (9,614) | (2,432) | (25,547) | 859 |
Included in other comprehensive income (loss) | (3,175) | (618) | ||
Net asset (liability) balance, end of period | 74,232 | 110,126 | 74,232 | 110,126 |
Derivative Liabilities | ||||
Rollforward for financial instruments measured at fair value using Level 3 inputs | ||||
Liability balance, beginning of period | (6,300) | (5,600) | ||
Purchases/Additions | (177) | (177) | ||
Total gains or losses (realized or unrealized): | ||||
Included in Net Income (Loss) | (350) | (1,050) | ||
Liability balance, end of period | (6,827) | (6,827) | ||
Available for sale securities | ||||
Rollforward for financial instruments measured at fair value using Level 3 inputs | ||||
Asset balance, beginning of period | 16 | 63,819 | 60,053 | |
Purchases/Additions | 7,301 | |||
Sales/Reductions | (3,397) | |||
Total gains or losses (realized or unrealized): | ||||
Included in Net Income (Loss) | (15) | 639 | (3,903) | 1,848 |
Included in other comprehensive income (loss) | (3,175) | (618) | ||
Asset balance, end of period | 1 | 61,283 | 1 | 61,283 |
Loans held for sale | ||||
Rollforward for financial instruments measured at fair value using Level 3 inputs | ||||
Asset balance, beginning of period | 19,123 | 10,409 | 9,017 | 27,729 |
Purchases/Additions | 11,466 | 6,110 | 40,075 | 16,531 |
Sales/Reductions | (2,769) | (1,600) | (12,493) | (31,203) |
Total gains or losses (realized or unrealized): | ||||
Included in Net Income (Loss) | (1,116) | (1,156) | (9,895) | 706 |
Asset balance, end of period | 26,704 | 13,763 | 26,704 | 13,763 |
MSR | ||||
Rollforward for financial instruments measured at fair value using Level 3 inputs | ||||
Asset balance, beginning of period | 44,985 | 35,877 | 36,155 | 20,149 |
Purchases/Additions | 11,025 | 18,982 | 23,121 | 33,790 |
Sales/Reductions | (11,387) | (11,387) | ||
Total gains or losses (realized or unrealized): | ||||
Included in Net Income (Loss) | (8,483) | (1,565) | (11,749) | (645) |
Asset balance, end of period | $ 47,527 | $ 41,907 | $ 47,527 | $ 41,907 |
Fair Value Measurements - Level
Fair Value Measurements - Level 3, Inputs, Recurring (Details) - Level 3 - Recurring - Discounted cash flow | 9 Months Ended |
Sep. 30, 2015 | |
Trading securities. | Weighted average | |
Significant unobservable inputs used in the fair value measurements | |
Discount rates (as a percent) | 10.00% |
Trading securities. | Minimum | |
Significant unobservable inputs used in the fair value measurements | |
Discount rates (as a percent) | 8.00% |
Trading securities. | Maximum | |
Significant unobservable inputs used in the fair value measurements | |
Discount rates (as a percent) | 17.00% |
Loans held for sale | Weighted average | |
Significant unobservable inputs used in the fair value measurements | |
Projected price (as a percent) | 94.00% |
Loans held for sale | Minimum | |
Significant unobservable inputs used in the fair value measurements | |
Projected price (as a percent) | 93.00% |
Loans held for sale | Maximum | |
Significant unobservable inputs used in the fair value measurements | |
Projected price (as a percent) | 95.00% |
MSR | Weighted average | |
Significant unobservable inputs used in the fair value measurements | |
Discount rates (as a percent) | 10.93% |
Constant prepayment rate (as a percent) | 13.68% |
Fair Value Measurements - Chang
Fair Value Measurements - Change in FV (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Fair Value, Transfers Between Level 1 and Level 2, Description and Policy [Abstract] | ||||
Transfers of assets from level 1 to level 2 | $ 0 | $ 0 | $ 0 | $ 0 |
Transfers of assets from level 2 to level 1 | 0 | 0 | 0 | 0 |
Transfers of liabilities from level 1 to level 2 | 0 | 0 | 0 | 0 |
Transfers of liabilities from level 2 to level 1 | 0 | 0 | 0 | 0 |
Fair Value, Option, Aggregate Differences [Abstract] | ||||
Net Gains (Losses) | 137,303 | 108,621 | 405,023 | 293,786 |
Other Noninterest Income | 28,586 | 20,045 | 75,270 | 54,239 |
Loans held for sale | ||||
Fair Value, Option, Aggregate Differences [Abstract] | ||||
Net Gains (Losses) | 18,531 | (15,250) | 2,773 | 24,918 |
Total Changes in Fair Value | 18,531 | (15,250) | 2,773 | 24,918 |
MSR | ||||
Fair Value, Option, Aggregate Differences [Abstract] | ||||
Net Gains (Losses) | (8,483) | (1,565) | (11,749) | (645) |
Total Changes in Fair Value | $ (8,483) | $ (1,565) | $ (11,749) | $ (645) |
Fair Value Measurements - Impai
Fair Value Measurements - Impaired Loans (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2015 | Jan. 01, 2015 | Sep. 13, 2013 | Nov. 30, 2012 | |
SWS | ||||
Fair value measurements | ||||
Fair value of loans acquired | $ 863,819 | |||
SWS | PCI loans | ||||
Fair value measurements | ||||
Fair value of loans acquired | 73,459 | |||
Level 3 | Plains Capital | PCI loans | ||||
Fair value measurements | ||||
Fair value of loans acquired | $ 172,900 | |||
Level 3 | Plains Capital | PCI loans | Weighted average | ||||
Fair Value Inputs [Abstract] | ||||
Weighted average default rate | 54.00% | |||
Weighted average loss severity rate | 51.00% | |||
Weighted average prepayment speed | 0.00% | |||
Weighted average expected loss | 28.00% | |||
Level 3 | FNB | PCI loans | ||||
Fair value measurements | ||||
Fair value of loans acquired | $ 822,800 | |||
Level 3 | FNB | PCI loans | Weighted average | ||||
Fair Value Inputs [Abstract] | ||||
Weighted average default rate | 54.00% | |||
Weighted average loss severity rate | 38.00% | |||
Weighted average prepayment speed | 6.00% | |||
Weighted average expected loss | 21.00% | |||
Level 3 | SWS | PCI loans | ||||
Fair value measurements | ||||
Fair value of loans acquired | $ 73,500 | |||
Level 3 | SWS | PCI loans | Weighted average | ||||
Fair Value Inputs [Abstract] | ||||
Weighted average default rate | 54.00% | |||
Weighted average loss severity rate | 38.00% | |||
Weighted average prepayment speed | 1.00% | |||
Weighted average expected loss | 20.00% |
Fair Value Measurements - OREO
Fair Value Measurements - OREO (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Jun. 30, 2015 | Jan. 01, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Sep. 13, 2013 | |
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | $ 4,956,540 | $ 4,956,540 | $ 3,883,435 | |||||||
Covered impaired loans | 420,547 | 420,547 | 638,029 | |||||||
Covered other real estate owned | 106,024 | 106,024 | 136,945 | |||||||
Provision for loan losses | 5,593 | $ 4,033 | 8,438 | $ 12,808 | ||||||
Covered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Covered impaired loans | 420,547 | 420,547 | 638,029 | |||||||
Covered other real estate owned | 106,024 | 126,798 | 106,024 | 126,798 | $ 125,510 | 136,945 | $ 142,174 | $ 142,833 | ||
Provision for loan losses | 1,313 | (153) | 779 | 3,151 | ||||||
Noncovered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | 4,956,540 | 4,956,540 | 3,883,435 | |||||||
Provision for loan losses | 4,280 | 4,186 | 7,659 | 9,657 | ||||||
Estimate of Fair Value Measurement | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | 5,002,716 | 5,002,716 | 3,907,194 | |||||||
Covered impaired loans | 569,111 | 569,111 | 767,751 | |||||||
Level 2 | Estimate of Fair Value Measurement | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | 606,293 | $ 606,293 | 378,425 | |||||||
Level 3 | ||||||||||
Fair value measurements | ||||||||||
Discount rate of OREO per month (as a percent) | 1.00% | |||||||||
Level 3 | Minimum | ||||||||||
Fair value measurements | ||||||||||
Estimated holding period of discount rate per month of OREO | 6 months | |||||||||
Level 3 | Maximum | ||||||||||
Fair value measurements | ||||||||||
Estimated holding period of discount rate per month of OREO | 24 months | |||||||||
Level 3 | SWS | ||||||||||
Fair value measurements | ||||||||||
Acquired OREO | $ 5,600 | |||||||||
Level 3 | Estimate of Fair Value Measurement | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | 4,396,423 | $ 4,396,423 | 3,528,769 | |||||||
Covered impaired loans | 569,111 | 569,111 | 767,751 | |||||||
Non-recurring | Covered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Provision for loan losses | (937) | 242 | 2,712 | (2,790) | ||||||
Total Gains (Losses) of other real estate owned | (5,370) | (14,440) | (9,428) | (17,399) | ||||||
Non-recurring | Noncovered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Provision for loan losses | 453 | (1,714) | 224 | (2,151) | ||||||
Total Gains (Losses) of other real estate owned | $ (210) | (28) | $ (321) | |||||||
Non-recurring | Estimate of Fair Value Measurement | Covered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Covered impaired loans | 28,958 | 28,958 | ||||||||
Covered other real estate owned | 30,605 | 30,605 | ||||||||
Non-recurring | Estimate of Fair Value Measurement | Noncovered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | 62,144 | 62,144 | ||||||||
Non-recurring | Level 2 | Estimate of Fair Value Measurement | Covered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Covered other real estate owned | 30,605 | 30,605 | ||||||||
Non-recurring | Level 2 | Estimate of Fair Value Measurement | Noncovered | ||||||||||
Fair value measurements | ||||||||||
Other real estate owned | 500 | 500 | 800 | |||||||
Non-recurring | Level 3 | FNB | Covered | Bank | ||||||||||
Fair value measurements | ||||||||||
Acquired OREO | $ 135,200 | |||||||||
Non-recurring | Level 3 | Estimate of Fair Value Measurement | Covered | ||||||||||
Fair value measurements | ||||||||||
Other real estate owned | 106,000 | 106,000 | $ 136,900 | |||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Covered impaired loans | 28,958 | 28,958 | ||||||||
Non-recurring | Level 3 | Estimate of Fair Value Measurement | Noncovered | ||||||||||
Fair Value, Net Asset (Liability) [Abstract] | ||||||||||
Non-covered impaired loans | $ 62,144 | $ 62,144 |
Fair Value Measurements - Estim
Fair Value Measurements - Estimated Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 |
Financial assets: | ||||||
Held to maturity securities | $ 308,031 | $ 118,345 | ||||
Non-covered loans, net | 4,956,540 | 3,883,435 | ||||
Covered loans | 420,547 | 638,029 | ||||
Broker-dealer and clearing organization receivables | 2,111,864 | 167,884 | ||||
FDIC indemnification asset | 92,902 | $ 102,381 | 130,437 | $ 149,788 | $ 175,114 | $ 188,291 |
Financial liabilities: | ||||||
Broker-dealer and clearing organization payables | 2,045,604 | 179,042 | ||||
Carrying Amount | ||||||
Financial assets: | ||||||
Cash and cash equivalents | 551,553 | 813,075 | ||||
Securities purchased under agreements to resell | 83,889 | |||||
Held to maturity securities | 305,316 | 118,209 | ||||
Loans held for sale | 48,453 | 37,541 | ||||
Non-covered loans, net | 4,956,540 | 3,883,435 | ||||
Covered loans | 420,547 | 638,029 | ||||
Broker-dealer and clearing organization receivables | 2,111,864 | 167,884 | ||||
FDIC indemnification asset | 92,902 | 130,437 | ||||
Other assets | 61,606 | 59,432 | ||||
Financial liabilities: | ||||||
Deposits | 6,820,749 | 6,369,892 | ||||
Broker-dealer and clearing organization payables | 2,045,604 | 179,042 | ||||
Short-term borrowings | 910,490 | 762,696 | ||||
Debt | 310,568 | 123,696 | ||||
Other liabilities | 5,382 | 2,144 | ||||
Estimate of Fair Value Measurement | ||||||
Financial assets: | ||||||
Cash and cash equivalents | 551,553 | 813,075 | ||||
Securities purchased under agreements to resell | 83,889 | |||||
Held to maturity securities | 308,031 | 118,345 | ||||
Loans held for sale | 48,453 | 37,541 | ||||
Non-covered loans, net | 5,002,716 | 3,907,194 | ||||
Covered loans | 569,111 | 767,751 | ||||
Broker-dealer and clearing organization receivables | 2,111,864 | 167,884 | ||||
FDIC indemnification asset | 92,902 | 130,437 | ||||
Other assets | 61,606 | 59,432 | ||||
Financial liabilities: | ||||||
Deposits | 6,824,771 | 6,365,555 | ||||
Broker-dealer and clearing organization payables | 2,045,604 | 179,042 | ||||
Short-term borrowings | 910,490 | 762,696 | ||||
Debt | 303,987 | 117,028 | ||||
Other liabilities | 5,382 | 2,144 | ||||
Estimate of Fair Value Measurement | Level 1 | ||||||
Financial assets: | ||||||
Cash and cash equivalents | 551,553 | 813,075 | ||||
Estimate of Fair Value Measurement | Level 2 | ||||||
Financial assets: | ||||||
Securities purchased under agreements to resell | 83,889 | |||||
Held to maturity securities | 308,031 | 118,345 | ||||
Loans held for sale | 48,453 | 37,541 | ||||
Non-covered loans, net | 606,293 | 378,425 | ||||
Broker-dealer and clearing organization receivables | 2,111,864 | 167,884 | ||||
Other assets | 44,950 | 43,937 | ||||
Financial liabilities: | ||||||
Deposits | 6,824,771 | 6,365,555 | ||||
Broker-dealer and clearing organization payables | 2,045,604 | 179,042 | ||||
Short-term borrowings | 910,490 | 762,696 | ||||
Debt | 303,987 | 117,028 | ||||
Other liabilities | 5,382 | 2,144 | ||||
Estimate of Fair Value Measurement | Level 3 | ||||||
Financial assets: | ||||||
Non-covered loans, net | 4,396,423 | 3,528,769 | ||||
Covered loans | 569,111 | 767,751 | ||||
FDIC indemnification asset | 92,902 | 130,437 | ||||
Other assets | $ 16,656 | $ 15,495 |
Securities - Trading Securities
Securities - Trading Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Schedule of fair value of trading securities | ||
Trading Securities | $ 292,418 | $ 65,717 |
Investment-related Liabilities | ||
Securities sold, not yet purchased, at fair value | 156,775 | 48 |
U.S. Treasury securities | ||
Schedule of fair value of trading securities | ||
Trading Securities | 8,428 | |
Bonds | ||
Schedule of fair value of trading securities | ||
Trading Securities | 34,241 | |
Residential mortgage-backed securities | ||
Schedule of fair value of trading securities | ||
Trading Securities | 24,883 | 5,126 |
Commercial mortgage-backed securities | ||
Schedule of fair value of trading securities | ||
Trading Securities | 20,765 | 19,932 |
Collateralized mortgage obligations | ||
Schedule of fair value of trading securities | ||
Trading Securities | 1,557 | |
Corporate securities | ||
Schedule of fair value of trading securities | ||
Trading Securities | 69,787 | 4 |
States and political subdivisions | ||
Schedule of fair value of trading securities | ||
Trading Securities | 80,161 | 40,616 |
Unit investment trusts | ||
Schedule of fair value of trading securities | ||
Trading Securities | 34,979 | |
Private-label securitized product | ||
Schedule of fair value of trading securities | ||
Trading Securities | 16,278 | |
Other | ||
Schedule of fair value of trading securities | ||
Trading Securities | $ 1,339 | $ 39 |
Securities - AFS and HTM, Amort
Securities - AFS and HTM, Amortized Cost and FV (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Available for sale | ||
Amortized Cost | $ 719,212 | $ 924,755 |
Gross Unrealized Gains | 10,618 | 11,542 |
Gross Unrealized Losses | (3,698) | (10,762) |
Fair Value | 726,132 | 925,535 |
Held to maturity | ||
Amortized Cost | 305,316 | 118,209 |
Unrealized Gains | 2,765 | 575 |
Unrealized Losses | (50) | (439) |
Held to maturity, fair value | 308,031 | 118,345 |
U.S. Treasury securities | ||
Available for sale | ||
Amortized Cost | 19,382 | 19,382 |
Gross Unrealized Gains | 363 | 264 |
Gross Unrealized Losses | (4) | (33) |
Fair Value | 19,741 | 19,613 |
Held to maturity | ||
Amortized Cost | 50,220 | 25,008 |
Unrealized Gains | 16 | |
Unrealized Losses | (6) | |
Held to maturity, fair value | 50,236 | 25,002 |
Bonds | ||
Available for sale | ||
Amortized Cost | 354,611 | 522,008 |
Gross Unrealized Gains | 1,961 | 1,749 |
Gross Unrealized Losses | (1,333) | (7,516) |
Fair Value | 355,239 | 516,241 |
Held to maturity | ||
Amortized Cost | 22,386 | |
Unrealized Gains | 206 | |
Held to maturity, fair value | 22,592 | |
Residential mortgage-backed securities | ||
Available for sale | ||
Amortized Cost | 36,480 | 40,171 |
Gross Unrealized Gains | 1,189 | 1,672 |
Gross Unrealized Losses | (14) | |
Fair Value | 37,655 | 41,843 |
Held to maturity | ||
Amortized Cost | 24,529 | 29,782 |
Unrealized Gains | 614 | 528 |
Held to maturity, fair value | 25,143 | 30,310 |
Commercial mortgage-backed securities | ||
Available for sale | ||
Amortized Cost | 9,027 | 11,192 |
Gross Unrealized Gains | 103 | |
Gross Unrealized Losses | (2) | (137) |
Fair Value | 9,128 | 11,055 |
Held to maturity | ||
Amortized Cost | 12,860 | |
Unrealized Gains | 345 | |
Held to maturity, fair value | 13,205 | |
Collateralized mortgage obligations | ||
Available for sale | ||
Amortized Cost | 60,238 | 89,291 |
Gross Unrealized Gains | 112 | 133 |
Gross Unrealized Losses | (944) | (2,300) |
Fair Value | 59,406 | 87,124 |
Held to maturity | ||
Amortized Cost | 177,968 | 57,328 |
Unrealized Gains | 1,487 | |
Unrealized Losses | (31) | (430) |
Held to maturity, fair value | 179,424 | 56,898 |
Corporate securities | ||
Available for sale | ||
Amortized Cost | 100,471 | 93,406 |
Gross Unrealized Gains | 4,078 | 5,125 |
Gross Unrealized Losses | (249) | (59) |
Fair Value | 104,300 | 98,472 |
States and political subdivisions | ||
Available for sale | ||
Amortized Cost | 120,548 | 135,419 |
Gross Unrealized Gains | 2,310 | 2,083 |
Gross Unrealized Losses | (366) | (717) |
Fair Value | 122,492 | 136,785 |
Held to maturity | ||
Amortized Cost | 17,353 | 6,091 |
Unrealized Gains | 97 | 47 |
Unrealized Losses | (19) | (3) |
Held to maturity, fair value | 17,431 | 6,135 |
Commercial mortgage backed securities | ||
Available for sale | ||
Amortized Cost | 579 | 593 |
Gross Unrealized Gains | 42 | 47 |
Fair Value | 621 | 640 |
Equity securities | ||
Available for sale | ||
Amortized Cost | 17,876 | 13,293 |
Gross Unrealized Gains | 460 | 469 |
Gross Unrealized Losses | (786) | |
Fair Value | $ 17,550 | $ 13,762 |
Securities - AFS in an Unrealiz
Securities - AFS in an Unrealized Loss Position (Details) $ in Thousands | Sep. 30, 2015USD ($)item | Dec. 31, 2014USD ($)item |
Number of Securities | ||
Unrealized loss for less than twelve months | item | 37 | 17 |
Unrealized loss for twelve months or longer | item | 69 | 117 |
Total | item | 106 | 134 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 178,974 | $ 54,123 |
Unrealized loss for twelve months or longer | 125,933 | 503,022 |
Estimated Fair Value, Total | 304,907 | 557,145 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 1,457 | 227 |
Unrealized loss for twelve months or longer | 2,241 | 10,535 |
Total | $ 3,698 | $ 10,762 |
U.S. Treasury securities | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 3 | 4 |
Unrealized loss for twelve months or longer | item | 1 | |
Total | item | 3 | 5 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 4,358 | $ 7,703 |
Unrealized loss for twelve months or longer | 1,706 | |
Estimated Fair Value, Total | 4,358 | 9,409 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 4 | 27 |
Unrealized loss for twelve months or longer | 6 | |
Total | $ 4 | $ 33 |
Bonds | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 7 | 3 |
Unrealized loss for twelve months or longer | item | 3 | 22 |
Total | item | 10 | 25 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 143,122 | $ 34,847 |
Unrealized loss for twelve months or longer | 44,601 | 373,035 |
Estimated Fair Value, Total | 187,723 | 407,882 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 571 | 153 |
Unrealized loss for twelve months or longer | 762 | 7,363 |
Total | $ 1,333 | $ 7,516 |
Residential mortgage-backed securities | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 1 | |
Total | item | 1 | |
Fair Value | ||
Unrealized loss for less than twelve months | $ 1,030 | |
Estimated Fair Value, Total | 1,030 | |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 14 | |
Total | $ 14 | |
Commercial mortgage-backed securities | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 1 | |
Unrealized loss for twelve months or longer | item | 10 | 4 |
Total | item | 11 | 4 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 1,618 | |
Unrealized loss for twelve months or longer | 8 | $ 11,056 |
Estimated Fair Value, Total | 1,626 | 11,056 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 2 | |
Unrealized loss for twelve months or longer | 137 | |
Total | $ 2 | $ 137 |
Collateralized mortgage obligations | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 2 | 3 |
Unrealized loss for twelve months or longer | item | 7 | 8 |
Total | item | 9 | 11 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 431 | $ 7,141 |
Unrealized loss for twelve months or longer | 47,045 | 61,108 |
Estimated Fair Value, Total | 47,476 | 68,249 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 2 | 40 |
Unrealized loss for twelve months or longer | 942 | 2,260 |
Total | $ 944 | $ 2,300 |
Corporate securities | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 12 | |
Unrealized loss for twelve months or longer | item | 1 | 1 |
Total | item | 13 | 1 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 11,732 | |
Unrealized loss for twelve months or longer | 1,935 | $ 1,939 |
Estimated Fair Value, Total | 13,667 | 1,939 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 186 | |
Unrealized loss for twelve months or longer | 63 | 59 |
Total | $ 249 | $ 59 |
States and political subdivisions | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 8 | 7 |
Unrealized loss for twelve months or longer | item | 46 | 81 |
Total | item | 54 | 88 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 6,524 | $ 4,432 |
Unrealized loss for twelve months or longer | 31,450 | 54,178 |
Estimated Fair Value, Total | 37,974 | 58,610 |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 22 | 7 |
Unrealized loss for twelve months or longer | 344 | 710 |
Total | $ 366 | $ 717 |
Equity securities | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 3 | |
Unrealized loss for twelve months or longer | item | 2 | |
Total | item | 5 | |
Fair Value | ||
Unrealized loss for less than twelve months | $ 10,159 | |
Unrealized loss for twelve months or longer | 894 | |
Estimated Fair Value, Total | 11,053 | |
Unrealized Loss | ||
Unrealized loss for less than twelve months | 656 | |
Unrealized loss for twelve months or longer | 130 | |
Total | $ 786 |
Securities - HTM in an Unrealiz
Securities - HTM in an Unrealized Loss Position (Details) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015USD ($)item | Dec. 31, 2014USD ($)item | |
Number of Securities | ||
Unrealized loss for less than twelve months | item | 13 | 7 |
Total | item | 13 | 7 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 22,814 | $ 83,799 |
Total | 22,814 | 83,799 |
Unrealized Losses | ||
Unrealized loss for less than twelve months | 50 | 439 |
Total | $ 50 | $ 439 |
U.S. Treasury securities | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 1 | |
Total | item | 1 | |
Fair Value | ||
Unrealized loss for less than twelve months | $ 25,002 | |
Total | 25,002 | |
Unrealized Losses | ||
Unrealized loss for less than twelve months | 6 | |
Total | $ 6 | |
Collateralized mortgage obligations | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 1 | 2 |
Total | item | 1 | 2 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 18,514 | $ 56,898 |
Total | 18,514 | 56,898 |
Unrealized Losses | ||
Unrealized loss for less than twelve months | 31 | 430 |
Total | $ 31 | $ 430 |
States and political subdivisions | ||
Number of Securities | ||
Unrealized loss for less than twelve months | item | 12 | 4 |
Total | item | 12 | 4 |
Fair Value | ||
Unrealized loss for less than twelve months | $ 4,300 | $ 1,899 |
Total | 4,300 | 1,899 |
Unrealized Losses | ||
Unrealized loss for less than twelve months | 19 | 3 |
Total | $ 19 | $ 3 |
Securities - AFS Contractual Ma
Securities - AFS Contractual Maturities (Details) $ in Thousands | Sep. 30, 2015USD ($) |
AFS, Amortized Cost, Rolling Maturity | |
Due in one year or less | $ 27,223 |
Due after one year through five years | 66,426 |
Due after five years through ten years | 79,749 |
Due after ten years | 421,614 |
Total | 595,012 |
Total amortized cost | 701,336 |
AFS, Fair Value, Rolling Maturity | |
Due in one year or less | 27,530 |
Due after one year through five years | 69,337 |
Due after five years through ten years | 82,745 |
Due after ten years | 422,160 |
Total | 601,772 |
Fair Value | 708,582 |
Residential mortgage-backed securities | |
AFS, Amortized Cost, Rolling Maturity | |
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 36,480 |
AFS, Fair Value, Rolling Maturity | |
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 37,655 |
Collateralized mortgage obligations | |
AFS, Amortized Cost, Rolling Maturity | |
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 60,238 |
AFS, Fair Value, Rolling Maturity | |
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 59,406 |
Commercial mortgage backed securities | |
AFS, Amortized Cost, Rolling Maturity | |
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 9,606 |
AFS, Fair Value, Rolling Maturity | |
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | $ 9,749 |
Securities - HTM Contractual Ma
Securities - HTM Contractual Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
HTM, Amortized Cost, Rolling Maturities | ||
Due in one year or less | $ 51,750 | |
Due after one year through five years | 20,098 | |
Due after five years through ten years | 4,077 | |
Due after ten years | 14,034 | |
Total | 89,959 | |
Total amortized cost | 305,316 | $ 118,209 |
HTM, Fair Value, Rolling Maturities | ||
Due in one year or less | 51,770 | |
Due after one year through five years | 20,314 | |
Due after five years through ten years | 4,093 | |
Due after ten years | 14,082 | |
Total | 90,259 | |
Held to maturity, fair value | 308,031 | 118,345 |
Residential mortgage-backed securities | ||
HTM, Amortized Cost, Rolling Maturities | ||
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 24,529 | |
Total amortized cost | 24,529 | 29,782 |
HTM, Fair Value, Rolling Maturities | ||
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 25,143 | |
Held to maturity, fair value | 25,143 | 30,310 |
Collateralized mortgage obligations | ||
HTM, Amortized Cost, Rolling Maturities | ||
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 177,968 | |
Total amortized cost | 177,968 | 57,328 |
HTM, Fair Value, Rolling Maturities | ||
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 179,424 | |
Held to maturity, fair value | 179,424 | $ 56,898 |
Commercial mortgage backed securities | ||
HTM, Amortized Cost, Rolling Maturities | ||
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | 12,860 | |
HTM, Fair Value, Rolling Maturities | ||
Mortgage-backed securities, collateralized mortgage obligations and commercial mortgage-backed securities | $ 13,205 |
Securities - Additional Informa
Securities - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Realized net gain (loss) from trading securities portfolio | $ 4.8 | $ 0.2 | $ 7.6 | $ 1.6 | |
Carrying amount of securities pledged | 780.2 | 780.2 | $ 895.5 | ||
Fair value of securities pledged | 785 | 785 | 890.3 | ||
NLC | |||||
Deposit with various state insurance departments | $ 9.2 | $ 9.2 | $ 9.2 |
Non-Covered Loans and Allowan75
Non-Covered Loans and Allowance for Non-Covered Loan Losses - Summary (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 |
Loans | ||||||
Total loans | $ 4,999,529 | $ 3,920,476 | ||||
Allowance for loan losses | (42,989) | (37,041) | ||||
Non-covered loans, net | 4,956,540 | 3,883,435 | ||||
Noncovered | ||||||
Loans | ||||||
Total loans | 4,999,529 | 3,920,476 | ||||
Allowance for loan losses | (42,989) | $ (40,484) | (37,041) | $ (39,027) | $ (36,431) | $ (33,241) |
Non-covered loans, net | 4,956,540 | 3,883,435 | ||||
Noncovered | Commercial and industrial | ||||||
Loans | ||||||
Total loans | 2,121,542 | 1,758,851 | ||||
Allowance for loan losses | (18,731) | (18,853) | (18,999) | (18,845) | (18,062) | (16,865) |
Margin loans to customers and correspondents | 606,000 | 378,400 | ||||
Noncovered | Real estate | ||||||
Loans | ||||||
Total loans | 2,253,286 | 1,694,835 | ||||
Allowance for loan losses | (16,360) | (14,565) | (11,131) | (11,065) | (9,998) | (8,331) |
Noncovered | Construction and land development | ||||||
Loans | ||||||
Total loans | 576,864 | 413,643 | ||||
Allowance for loan losses | (7,692) | (6,845) | (6,450) | (8,499) | (8,086) | (7,957) |
Noncovered | Consumer | ||||||
Loans | ||||||
Total loans | 47,837 | 53,147 | ||||
Allowance for loan losses | $ (206) | $ (221) | $ (461) | $ (618) | $ (285) | $ (88) |
Non-Covered Loans and Allowan76
Non-Covered Loans and Allowance for Non-Covered Loan Losses - PCI Loans (Details) - Noncovered - PCI loans - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Carrying values and the outstanding contractual balances of the PCI loans | |||||
Carrying amount | $ 81,161 | $ 81,161 | $ 48,909 | ||
Outstanding balance | 104,055 | 104,055 | 67,740 | ||
Changes in the accretable yield for the acquired impaired loans | |||||
Balance, beginning of period | 22,168 | $ 11,904 | 12,814 | $ 17,601 | |
Additions | 14,579 | ||||
Reclassifications from (to) nonaccretable difference, net | 6,234 | 4,270 | 11,173 | 13,886 | |
Disposals of loans | (744) | (2,778) | (4,928) | ||
Accretion | (9,206) | (2,199) | (16,592) | (13,328) | |
Balance, end of period | 19,196 | $ 13,231 | 19,196 | $ 13,231 | |
Nonaccretable difference | $ 31,100 | $ 31,100 | $ 18,400 |
Non-Covered Loans and Allowan77
Non-Covered Loans and Allowance for Non-Covered Loan Losses - Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Impaired loans | |||||
Days outstanding loans and leases receivable are generally considered past due | 90 days | ||||
Noncovered | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | $ 163,512 | $ 163,512 | $ 111,615 | ||
Recorded Investment with No Allowance | 58,946 | 58,946 | 31,247 | ||
Recorded Investment with Allowance | 42,812 | 42,812 | 32,563 | ||
Total Recorded Investment | 101,758 | 101,758 | 63,810 | ||
Related Allowance | 5,516 | 5,516 | 5,740 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 109,918 | $ 66,164 | 82,786 | $ 84,620 | |
Non-accrual loans | |||||
Non-accrual loans | 28,062 | 28,062 | 19,042 | ||
Interest income recorded on accruing impaired loans | 4,900 | 100 | 7,400 | 2,600 | |
Noncovered | Secured | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 59,402 | 59,402 | 51,036 | ||
Recorded Investment with No Allowance | 20,089 | 20,089 | 14,096 | ||
Recorded Investment with Allowance | 12,623 | 12,623 | 11,783 | ||
Total Recorded Investment | 32,712 | 32,712 | 25,879 | ||
Related Allowance | 2,695 | 2,695 | 3,341 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 33,137 | 24,897 | 29,296 | 31,953 | |
Non-accrual loans | |||||
Non-accrual loans | 22,244 | 22,244 | 16,488 | ||
Noncovered | Unsecured | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 3,534 | 3,534 | 4,120 | ||
Recorded Investment with No Allowance | 76 | 76 | 92 | ||
Recorded Investment with Allowance | 68 | ||||
Total Recorded Investment | 76 | 76 | 160 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 73 | 395 | 118 | 913 | |
Non-accrual loans | |||||
Non-accrual loans | 58 | 58 | 160 | ||
Noncovered | Secured by commercial properties | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 68,436 | 68,436 | 29,865 | ||
Recorded Investment with No Allowance | 24,509 | 24,509 | 7,243 | ||
Recorded Investment with Allowance | 23,961 | 23,961 | 15,536 | ||
Total Recorded Investment | 48,470 | 48,470 | 22,779 | ||
Related Allowance | 2,393 | 2,393 | 1,878 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 55,050 | 23,715 | 35,625 | 29,707 | |
Non-accrual loans | |||||
Non-accrual loans | 4,600 | 4,600 | 438 | ||
Noncovered | Secured by residential properties | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 18,658 | 18,658 | 4,701 | ||
Recorded Investment with No Allowance | 9,640 | 9,640 | 1,583 | ||
Recorded Investment with Allowance | 4,396 | 4,396 | 1,390 | ||
Total Recorded Investment | 14,036 | 14,036 | 2,973 | ||
Related Allowance | 198 | 198 | 85 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 14,853 | 3,611 | 8,505 | 3,259 | |
Non-accrual loans | |||||
Non-accrual loans | 1,028 | 1,028 | 1,253 | ||
Non-accrual loans held for sale | 1,500 | 1,500 | 3,000 | ||
Noncovered | Residential construction loans | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 397 | 397 | |||
Recorded Investment with No Allowance | 1 | 1 | |||
Recorded Investment with Allowance | 225 | 225 | |||
Total Recorded Investment | 226 | 226 | |||
Related Allowance | 7 | 7 | |||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 289 | 113 | |||
Noncovered | Commercial construction loans and land development | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 8,583 | 8,583 | 16,108 | ||
Recorded Investment with No Allowance | 3,764 | 3,764 | 8,062 | ||
Recorded Investment with Allowance | 1,517 | 1,517 | 1,819 | ||
Total Recorded Investment | 5,281 | 5,281 | 9,881 | ||
Related Allowance | 180 | 180 | 154 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 5,455 | 10,674 | 7,581 | 15,206 | |
Non-accrual loans | |||||
Non-accrual loans | 118 | 118 | 703 | ||
Noncovered | Consumer | |||||
Non-covered impaired loans | |||||
Unpaid Contractual Principal balance | 4,502 | 4,502 | 5,785 | ||
Recorded Investment with No Allowance | 867 | 867 | 171 | ||
Recorded Investment with Allowance | 90 | 90 | 1,967 | ||
Total Recorded Investment | 957 | 957 | 2,138 | ||
Related Allowance | 43 | 43 | 282 | ||
Average investment in non-covered impaired loans | |||||
Average investment in non-covered impaired loans | 1,061 | $ 2,872 | 1,548 | $ 3,582 | |
Non-accrual loans | |||||
Non-accrual loans | 14 | 14 | |||
Noncovered | PCI loans | |||||
Non-accrual loans | |||||
Non-accrual loans | $ 9,600 | $ 9,600 | $ 6,600 |
Non-Covered Loans and Allowan78
Non-Covered Loans and Allowance for Non-Covered Loan Losses - TDRs (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($)item | Sep. 30, 2014item | Sep. 30, 2015USD ($)item | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
AB Note | Minimum | Bank | |||||
TDRs, Non-covered loans | |||||
Number of loans into which a single loan is reconfigured | item | 2 | ||||
Noncovered | |||||
TDRs, Non-covered loans | |||||
Total Modifications | $ 1,171 | $ 1,171 | $ 712 | ||
Recorded Investment in loans | |||||
Number of TDRs granted | item | 1 | 0 | 1 | ||
Recorded Investment | $ 1,083 | $ 1,083 | |||
Noncovered | Bank | |||||
TDRs, Non-covered loans | |||||
Unadvanced commitments to borrowers | $ 500 | ||||
Noncovered | Payment Term Extension | |||||
TDRs, Non-covered loans | |||||
Total Modifications | 1,171 | 1,171 | 712 | ||
Noncovered | Secured | |||||
TDRs, Non-covered loans | |||||
Total Modifications | 88 | 88 | |||
Noncovered | Secured | Payment Term Extension | |||||
TDRs, Non-covered loans | |||||
Total Modifications | 88 | 88 | |||
Noncovered | Secured by commercial properties | |||||
TDRs, Non-covered loans | |||||
Total Modifications | $ 1,083 | $ 1,083 | 326 | ||
Recorded Investment in loans | |||||
Number of TDRs granted | item | 1 | 1 | |||
Recorded Investment | $ 1,083 | $ 1,083 | |||
Noncovered | Secured by commercial properties | Payment Term Extension | |||||
TDRs, Non-covered loans | |||||
Total Modifications | $ 1,083 | $ 1,083 | 326 | ||
Noncovered | Secured by residential properties | |||||
TDRs, Non-covered loans | |||||
Total Modifications | 253 | ||||
Noncovered | Secured by residential properties | Payment Term Extension | |||||
TDRs, Non-covered loans | |||||
Total Modifications | 253 | ||||
Noncovered | Commercial construction loans and land development | |||||
TDRs, Non-covered loans | |||||
Total Modifications | 133 | ||||
Noncovered | Commercial construction loans and land development | Payment Term Extension | |||||
TDRs, Non-covered loans | |||||
Total Modifications | $ 133 |
Non-Covered Loans and Allowan79
Non-Covered Loans and Allowance for Non-Covered Loan Losses - Aging (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | $ 4,999,529 | $ 3,920,476 |
Noncovered | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 4,999,529 | 3,920,476 |
Noncovered | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 81,161 | 48,909 |
Noncovered | Secured | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 2,024,618 | 1,648,433 |
Noncovered | Secured | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 13,632 | 13,374 |
Noncovered | Unsecured | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 96,924 | 110,418 |
Noncovered | Unsecured | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 17 | 68 |
Noncovered | Secured by commercial properties | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 1,524,980 | 1,195,912 |
Noncovered | Secured by commercial properties | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 48,077 | 22,341 |
Noncovered | Secured by residential properties | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 728,306 | 498,923 |
Noncovered | Secured by residential properties | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 13,089 | 1,810 |
Noncovered | Residential construction loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 95,894 | 65,046 |
Noncovered | Residential construction loans | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 225 | |
Noncovered | Commercial construction loans and land development | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 480,970 | 348,597 |
Noncovered | Commercial construction loans and land development | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 5,164 | 9,178 |
Noncovered | Consumer | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 47,837 | 53,147 |
Noncovered | Consumer | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 957 | 2,138 |
Noncovered | Bank | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 6,932 | 11,537 |
Loans past Due 60-89 Days | 1,738 | 2,191 |
Loans past Due 90 Days or More | 9,898 | 8,597 |
Total Past Due Loans | 18,568 | 22,325 |
Current Loans | 4,899,800 | 3,849,242 |
Total loans | 4,999,529 | 3,920,476 |
Accruing Loans Past Due 90 Days or More | 452 | |
Noncovered | Bank | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 81,161 | 48,909 |
Noncovered | Bank | Secured | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 1,153 | 6,073 |
Loans past Due 60-89 Days | 1,120 | 964 |
Loans past Due 90 Days or More | 9,506 | 8,022 |
Total Past Due Loans | 11,779 | 15,059 |
Current Loans | 1,999,207 | 1,620,000 |
Total loans | 2,024,618 | 1,648,433 |
Accruing Loans Past Due 90 Days or More | 115 | |
Noncovered | Bank | Secured | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 13,632 | 13,374 |
Noncovered | Bank | Unsecured | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 53 | 35 |
Loans past Due 60-89 Days | 30 | 3 |
Total Past Due Loans | 83 | 38 |
Current Loans | 96,824 | 110,312 |
Total loans | 96,924 | 110,418 |
Noncovered | Bank | Unsecured | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 17 | 68 |
Noncovered | Bank | Secured by commercial properties | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 277 | 67 |
Total Past Due Loans | 277 | 67 |
Current Loans | 1,476,626 | 1,173,504 |
Total loans | 1,524,980 | 1,195,912 |
Noncovered | Bank | Secured by commercial properties | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 48,077 | 22,341 |
Noncovered | Bank | Secured by residential properties | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 3,949 | 454 |
Loans past Due 60-89 Days | 417 | 1,187 |
Loans past Due 90 Days or More | 392 | |
Total Past Due Loans | 4,758 | 1,641 |
Current Loans | 710,459 | 495,472 |
Total loans | 728,306 | 498,923 |
Accruing Loans Past Due 90 Days or More | 337 | |
Noncovered | Bank | Secured by residential properties | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 13,089 | 1,810 |
Noncovered | Bank | Residential construction loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 175 | |
Total Past Due Loans | 175 | |
Current Loans | 95,669 | 64,871 |
Total loans | 95,894 | 65,046 |
Noncovered | Bank | Residential construction loans | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 225 | |
Noncovered | Bank | Commercial construction loans and land development | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 1,157 | 4,319 |
Loans past Due 60-89 Days | 117 | |
Loans past Due 90 Days or More | 575 | |
Total Past Due Loans | 1,274 | 4,894 |
Current Loans | 474,532 | 334,525 |
Total loans | 480,970 | 348,597 |
Noncovered | Bank | Commercial construction loans and land development | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 5,164 | 9,178 |
Noncovered | Bank | Consumer | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Loans past Due 30-59 Days | 343 | 414 |
Loans past Due 60-89 Days | 54 | 37 |
Total Past Due Loans | 397 | 451 |
Current Loans | 46,483 | 50,558 |
Total loans | 47,837 | 53,147 |
Noncovered | Bank | Consumer | PCI loans | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Total loans | 957 | 2,138 |
Noncovered | Prime Lending | U.S. government agencies | ||
Non-Covered Loans and Allowance for Non-Covered Loan Losses | ||
Accruing Loans Past Due 90 Days or More | 37,000 | 19,200 |
Unpaid principal balance loans past due 90 days or more | $ 37,200 | $ 19,200 |
Non-Covered Loans and Allowan80
Non-Covered Loans and Allowance for Non-Covered Loan Losses - Internal Risk Grades (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015USD ($)item | Dec. 31, 2014USD ($) | |
Internal risk grades of non-covered loans | ||
Total | $ 4,999,529 | $ 3,920,476 |
Bank | ||
Internal risk grades of non-covered loans | ||
Number of types of loans | item | 2 | |
Noncovered | ||
Internal risk grades of non-covered loans | ||
Total | $ 4,999,529 | 3,920,476 |
Noncovered | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 4,999,529 | 3,920,476 |
Noncovered | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 4,814,548 | 3,774,559 |
Noncovered | Special Mention | ||
Internal risk grades of non-covered loans | ||
Total | 10,906 | 1,817 |
Noncovered | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 92,914 | 95,191 |
Noncovered | Secured | ||
Internal risk grades of non-covered loans | ||
Total | 2,024,618 | 1,648,433 |
Noncovered | Secured | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 2,024,618 | 1,648,433 |
Noncovered | Secured | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 1,940,761 | 1,566,208 |
Noncovered | Secured | Special Mention | ||
Internal risk grades of non-covered loans | ||
Total | 8,516 | 1,105 |
Noncovered | Secured | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 61,709 | 67,746 |
Noncovered | Unsecured | ||
Internal risk grades of non-covered loans | ||
Total | 96,924 | 110,418 |
Noncovered | Unsecured | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 96,924 | 110,418 |
Noncovered | Unsecured | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 96,839 | 110,256 |
Noncovered | Unsecured | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 68 | 94 |
Noncovered | Secured by commercial properties | ||
Internal risk grades of non-covered loans | ||
Total | 1,524,980 | 1,195,912 |
Noncovered | Secured by commercial properties | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 1,524,980 | 1,195,912 |
Noncovered | Secured by commercial properties | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 1,450,440 | 1,151,454 |
Noncovered | Secured by commercial properties | Special Mention | ||
Internal risk grades of non-covered loans | ||
Total | 2,390 | 712 |
Noncovered | Secured by commercial properties | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 24,073 | 21,405 |
Noncovered | Secured by residential properties | ||
Internal risk grades of non-covered loans | ||
Total | 728,306 | 498,923 |
Noncovered | Secured by residential properties | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 728,306 | 498,923 |
Noncovered | Secured by residential properties | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 709,692 | 492,549 |
Noncovered | Secured by residential properties | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 5,525 | 4,564 |
Noncovered | Residential construction loans | ||
Internal risk grades of non-covered loans | ||
Total | 95,894 | 65,046 |
Noncovered | Residential construction loans | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 95,894 | 65,046 |
Noncovered | Residential construction loans | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 95,669 | 65,046 |
Noncovered | Commercial construction loans and land development | ||
Internal risk grades of non-covered loans | ||
Total | 480,970 | 348,597 |
Noncovered | Commercial construction loans and land development | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 480,970 | 348,597 |
Noncovered | Commercial construction loans and land development | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 474,342 | 338,078 |
Noncovered | Commercial construction loans and land development | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 1,464 | 1,341 |
Noncovered | Consumer | ||
Internal risk grades of non-covered loans | ||
Total | 47,837 | 53,147 |
Noncovered | Consumer | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 47,837 | 53,147 |
Noncovered | Consumer | Pass | ||
Internal risk grades of non-covered loans | ||
Total | 46,805 | 50,968 |
Noncovered | Consumer | Substandard | ||
Internal risk grades of non-covered loans | ||
Total | 75 | 41 |
Noncovered | PCI loans | ||
Internal risk grades of non-covered loans | ||
Total | 81,161 | 48,909 |
Noncovered | PCI loans | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 81,161 | 48,909 |
Noncovered | PCI loans | Secured | ||
Internal risk grades of non-covered loans | ||
Total | 13,632 | 13,374 |
Noncovered | PCI loans | Secured | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 13,632 | 13,374 |
Noncovered | PCI loans | Unsecured | ||
Internal risk grades of non-covered loans | ||
Total | 17 | 68 |
Noncovered | PCI loans | Unsecured | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 17 | 68 |
Noncovered | PCI loans | Secured by commercial properties | ||
Internal risk grades of non-covered loans | ||
Total | 48,077 | 22,341 |
Noncovered | PCI loans | Secured by commercial properties | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 48,077 | 22,341 |
Noncovered | PCI loans | Secured by residential properties | ||
Internal risk grades of non-covered loans | ||
Total | 13,089 | 1,810 |
Noncovered | PCI loans | Secured by residential properties | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 13,089 | 1,810 |
Noncovered | PCI loans | Residential construction loans | ||
Internal risk grades of non-covered loans | ||
Total | 225 | |
Noncovered | PCI loans | Residential construction loans | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 225 | |
Noncovered | PCI loans | Commercial construction loans and land development | ||
Internal risk grades of non-covered loans | ||
Total | 5,164 | 9,178 |
Noncovered | PCI loans | Commercial construction loans and land development | Bank | ||
Internal risk grades of non-covered loans | ||
Total | 5,164 | 9,178 |
Noncovered | PCI loans | Consumer | ||
Internal risk grades of non-covered loans | ||
Total | 957 | 2,138 |
Noncovered | PCI loans | Consumer | Bank | ||
Internal risk grades of non-covered loans | ||
Total | $ 957 | $ 2,138 |
Non-Covered Loans and Allowan81
Non-Covered Loans and Allowance for Non-Covered Loan Losses - Allowance (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | |
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | $ 37,041 | |||||
Provision charged to (recapture from) operations operations | $ 5,593 | $ 4,033 | 8,438 | $ 12,808 | ||
Balance, end of period | 42,989 | 42,989 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | $ 4,999,529 | $ 3,920,476 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 42,989 | 37,041 | 42,989 | 37,041 | ||
Noncovered | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 40,484 | 36,431 | 37,041 | 33,241 | ||
Provision charged to (recapture from) operations operations | 4,280 | 4,186 | 7,659 | 9,657 | ||
Loans charged off | (2,926) | (2,120) | (5,094) | (6,082) | ||
Recoveries on charged off loans | 1,151 | 530 | 3,383 | 2,211 | ||
Balance, end of period | 42,989 | 39,027 | 42,989 | 39,027 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment | 17,226 | 13,965 | ||||
Loans collectively evaluated for impairment | 4,901,142 | 3,857,602 | ||||
Total loans | 4,999,529 | 3,920,476 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment, allowance | 917 | 421 | ||||
Loans collectively evaluated for impairment, allowance | 37,473 | 31,301 | ||||
Total loans, allowance | 40,484 | 36,431 | 37,041 | 33,241 | 42,989 | 37,041 |
Noncovered | Commercial and industrial | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 18,853 | 18,062 | 18,999 | 16,865 | ||
Provision charged to (recapture from) operations operations | 1,636 | 2,302 | 1,065 | 5,876 | ||
Loans charged off | (2,685) | (1,976) | (4,305) | (5,707) | ||
Recoveries on charged off loans | 927 | 457 | 2,972 | 1,811 | ||
Balance, end of period | 18,731 | 18,845 | 18,731 | 18,845 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment | 17,126 | 11,842 | ||||
Loans collectively evaluated for impairment | 2,090,767 | 1,733,567 | ||||
Total loans | 2,121,542 | 1,758,851 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment, allowance | 917 | 421 | ||||
Loans collectively evaluated for impairment, allowance | 16,036 | 15,658 | ||||
Total loans, allowance | 18,853 | 18,062 | 18,999 | 16,865 | 18,731 | 18,999 |
Noncovered | Real estate | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 14,565 | 9,998 | 11,131 | 8,331 | ||
Provision charged to (recapture from) operations operations | 1,812 | 1,064 | 5,481 | 2,689 | ||
Loans charged off | (212) | (28) | (581) | (100) | ||
Recoveries on charged off loans | 195 | 31 | 329 | 145 | ||
Balance, end of period | 16,360 | 11,065 | 16,360 | 11,065 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment | 100 | 1,420 | ||||
Loans collectively evaluated for impairment | 2,192,020 | 1,669,264 | ||||
Total loans | 2,253,286 | 1,694,835 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 13,769 | 9,168 | ||||
Total loans, allowance | 14,565 | 9,998 | 11,131 | 8,331 | 16,360 | 11,131 |
Noncovered | Construction and land development | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 6,845 | 8,086 | 6,450 | 7,957 | ||
Provision charged to (recapture from) operations operations | 847 | 395 | 1,242 | 361 | ||
Recoveries on charged off loans | 18 | 181 | ||||
Balance, end of period | 7,692 | 8,499 | 7,692 | 8,499 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment | 703 | |||||
Loans collectively evaluated for impairment | 571,475 | 403,762 | ||||
Total loans | 576,864 | 413,643 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 7,505 | 6,296 | ||||
Total loans, allowance | 6,845 | 8,086 | 6,450 | 7,957 | 7,692 | 6,450 |
Noncovered | Consumer | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 221 | 285 | 461 | 88 | ||
Provision charged to (recapture from) operations operations | (15) | 425 | (129) | 731 | ||
Loans charged off | (29) | (116) | (208) | (275) | ||
Recoveries on charged off loans | 29 | 24 | 82 | 74 | ||
Balance, end of period | 206 | 618 | 206 | 618 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment | 46,880 | 51,009 | ||||
Total loans | 47,837 | 53,147 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 163 | 179 | ||||
Total loans, allowance | 221 | $ 285 | 461 | $ 88 | 206 | 461 |
Noncovered | PCI loans | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 5,319 | |||||
Balance, end of period | 4,599 | 4,599 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 81,161 | 48,909 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 4,599 | 5,319 | 4,599 | 5,319 | ||
Noncovered | PCI loans | Commercial and industrial | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 2,920 | |||||
Balance, end of period | 1,778 | 1,778 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 13,649 | 13,442 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 1,778 | 2,920 | 1,778 | 2,920 | ||
Noncovered | PCI loans | Real estate | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 1,963 | |||||
Balance, end of period | 2,591 | 2,591 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 61,166 | 24,151 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 2,591 | 1,963 | 2,591 | 1,963 | ||
Noncovered | PCI loans | Construction and land development | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 154 | |||||
Balance, end of period | 187 | 187 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 5,389 | 9,178 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 187 | 154 | 187 | 154 | ||
Noncovered | PCI loans | Consumer | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 282 | |||||
Balance, end of period | 43 | 43 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 957 | 2,138 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | $ 43 | $ 282 | $ 43 | $ 282 |
Covered Assets and Indemnific82
Covered Assets and Indemnification Asset - Indemnification Asset (Details) - Bank - FNB $ in Millions | Sep. 13, 2013USD ($) |
Loans | |
Percentage of net losses to be absorbed by FDIC on the first $240.4 million of net losses incurred as per the loss sharing agreement | 80.00% |
Threshold amount of net losses incurred for 80% of net losses to be absorbed by FDIC as per the loss sharing agreement, first layer | $ 240.4 |
Percentage of net losses to be absorbed by FDIC in excess of $240.4 million up to and including $365.7 million of net losses incurred as per the loss sharing agreement | 0.00% |
Threshold amount of net losses incurred for 0% of net losses to be absorbed by FDIC as per the loss sharing agreement, second layer | $ 365.7 |
Percentage of net losses to be absorbed by FDIC in excess of $365.7 million of net losses incurred as per the loss sharing agreement | 80.00% |
Threshold limit of subsequent recoveries reimbursable to the FDIC under the loss share agreement | $ 0 |
Period for which payment is required to be made to the FDIC of true-up amount | 10 years |
Covered | Commercial loan | |
Loans | |
Period of loss-sharing agreements in effect | 5 years |
Period of loss recovery provisions in effect | 8 years |
Covered | Single family residential loans | |
Loans | |
Period of loss-sharing agreements in effect | 10 years |
Period of loss recovery provisions in effect | 10 years |
Covered Assets and Indemnific83
Covered Assets and Indemnification Asset - Covered Loans Summary (Details) - USD ($) $ in Thousands | Sep. 13, 2013 | Sep. 30, 2015 | Dec. 31, 2014 |
Covered Loans | |||
Allowance for covered loans | $ (1,870) | $ (4,611) | |
Total covered loans, net of allowance | 420,547 | 638,029 | |
Covered | |||
Covered Loans | |||
Total covered loans | 422,417 | 642,640 | |
Allowance for covered loans | (1,870) | (4,611) | |
Total covered loans, net of allowance | 420,547 | 638,029 | |
Covered | Commercial and industrial | |||
Covered Loans | |||
Total covered loans | 14,972 | 30,780 | |
Covered | Real estate | |||
Covered Loans | |||
Total covered loans | 373,391 | 552,850 | |
Covered | Construction and land development | |||
Covered Loans | |||
Total covered loans | $ 34,054 | $ 59,010 | |
Bank | Covered | Acquired loans | |||
Loans | |||
Fair value of loans acquired | $ 1,100,000 | ||
Carryover of the allowance for loan losses recorded | $ 0 |
Covered Assets and Indemnific84
Covered Assets and Indemnification Asset - Covered PCI Loans (Details) - Covered - PCI loans - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Carrying value and the outstanding contractual balance of the covered PCI loans | |||||
Carrying amount | $ 251,018 | $ 251,018 | $ 435,388 | ||
Outstanding balance | 450,581 | 450,581 | 685,393 | ||
Changes in the accretable yield for the acquired impaired loans | |||||
Balance, beginning of period | 185,981 | $ 186,141 | 193,493 | $ 156,548 | |
Reclassifications from (to) nonaccretable difference, net | 35,338 | 25,026 | 61,339 | 82,607 | |
Transfer of loans to covered OREO | (153) | (281) | 1,346 | 5,091 | |
Accretion | (32,301) | (18,146) | (67,313) | (51,506) | |
Balance, end of period | 188,865 | $ 192,740 | 188,865 | $ 192,740 | |
Nonaccretable difference | $ 191,900 | $ 191,900 | $ 382,500 |
Covered Assets and Indemnific85
Covered Assets and Indemnification Asset - Impaired Loans (Details) - Covered - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Average investment in covered impaired loans | |||||
Average investment | $ 285,007 | $ 566,245 | $ 346,493 | $ 631,061 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 2,809 | 2,809 | $ 34,223 | ||
Secured | |||||
Average investment in covered impaired loans | |||||
Average investment | 8,258 | 17,953 | 10,481 | 22,794 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 71 | 71 | 442 | ||
Unsecured | |||||
Average investment in covered impaired loans | |||||
Average investment | 3,118 | 7,994 | 4,770 | 8,735 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 883 | ||||
Secured by commercial properties | |||||
Average investment in covered impaired loans | |||||
Average investment | 132,133 | 297,511 | 170,627 | 322,396 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 452 | 452 | 30,823 | ||
Secured by residential properties | |||||
Average investment in covered impaired loans | |||||
Average investment | 111,224 | 168,636 | 124,720 | 180,492 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 1,486 | 1,486 | 1,046 | ||
Residential construction loans | |||||
Average investment in covered impaired loans | |||||
Average investment | 904 | 2,356 | 1,133 | 3,459 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 775 | 775 | 1,018 | ||
Commercial construction loans and land development | |||||
Average investment in covered impaired loans | |||||
Average investment | 29,370 | $ 71,795 | 34,762 | $ 93,185 | |
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 25 | 25 | 11 | ||
PCI loans | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 532,848 | 532,848 | 761,063 | ||
Recorded Investment with No Allowance | 242,305 | 242,305 | 378,889 | ||
Recorded Investment with Allowance | 12,041 | 12,041 | 59,747 | ||
Total Recorded Investment | 254,346 | 254,346 | 438,636 | ||
Related Allowance | 1,822 | 1,822 | 4,534 | ||
Covered, Nonaccrual Loans | |||||
Non-accrual loans | 0 | 0 | 31,200 | ||
Interest income recorded | 14,300 | 14,300 | |||
PCI loans | Secured | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 16,949 | 16,949 | 26,447 | ||
Recorded Investment with No Allowance | 6,332 | 6,332 | 7,436 | ||
Recorded Investment with Allowance | 557 | 557 | 6,636 | ||
Total Recorded Investment | 6,889 | 6,889 | 14,072 | ||
Related Allowance | 35 | 35 | 265 | ||
PCI loans | Unsecured | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 10,888 | 10,888 | 14,111 | ||
Recorded Investment with No Allowance | 2,735 | 2,735 | 2,107 | ||
Recorded Investment with Allowance | 4,697 | ||||
Total Recorded Investment | 2,735 | 2,735 | 6,804 | ||
Related Allowance | 882 | ||||
PCI loans | Secured by commercial properties | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 244,655 | 244,655 | 387,302 | ||
Recorded Investment with No Allowance | 112,987 | 112,987 | 193,111 | ||
Recorded Investment with Allowance | 14 | 14 | 35,142 | ||
Total Recorded Investment | 113,001 | 113,001 | 228,253 | ||
Related Allowance | 10 | 10 | 2,381 | ||
PCI loans | Secured by residential properties | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 195,716 | 195,716 | 235,505 | ||
Recorded Investment with No Allowance | 102,944 | 102,944 | 129,571 | ||
Recorded Investment with Allowance | 4,007 | 4,007 | 12,918 | ||
Total Recorded Investment | 106,951 | 106,951 | 142,489 | ||
Related Allowance | 883 | 883 | 937 | ||
PCI loans | Residential construction loans | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 1,808 | 1,808 | 2,749 | ||
Recorded Investment with No Allowance | 893 | 893 | 1,018 | ||
Recorded Investment with Allowance | 354 | ||||
Total Recorded Investment | 893 | 893 | 1,372 | ||
Related Allowance | 69 | ||||
PCI loans | Commercial construction loans and land development | |||||
Impaired Financing Receivable, Recorded Investment [Abstract] | |||||
Unpaid Contractual Principal Balance | 62,832 | 62,832 | 94,949 | ||
Recorded Investment with No Allowance | 16,414 | 16,414 | 45,646 | ||
Recorded Investment with Allowance | 7,463 | 7,463 | |||
Total Recorded Investment | 23,877 | 23,877 | $ 45,646 | ||
Related Allowance | $ 894 | $ 894 |
Covered Assets and Indemnific86
Covered Assets and Indemnification Asset - TDRs (Details) - Covered $ in Thousands | 3 Months Ended | 9 Months Ended | 13 Months Ended |
Sep. 30, 2015USD ($)item | Sep. 30, 2015USD ($)item | Sep. 30, 2014item | |
Covered Loans | |||
Total Modifications | $ 55 | $ 564 | |
TDR 30 days past due repaid during period | $ 600 | ||
Recorded Investment in loans | |||
Number of loans | item | 2 | 2 | 0 |
Recorded Investment | $ 254 | $ 254 | |
AB Note | |||
Covered Loans | |||
Total Modifications | 119 | ||
Interest Rate Adjustment | |||
Covered Loans | |||
Total Modifications | $ 55 | 191 | |
Payment Term Extension | |||
Covered Loans | |||
Total Modifications | $ 254 | ||
Secured by commercial properties | |||
Recorded Investment in loans | |||
Number of loans | item | 1 | 1 | |
Secured by residential properties | |||
Covered Loans | |||
Total Modifications | $ 55 | $ 564 | |
Recorded Investment in loans | |||
Number of loans | item | 1 | 1 | |
Recorded Investment | $ 254 | $ 254 | |
Secured by residential properties | AB Note | |||
Covered Loans | |||
Total Modifications | 119 | ||
Secured by residential properties | Interest Rate Adjustment | |||
Covered Loans | |||
Total Modifications | $ 55 | 191 | |
Secured by residential properties | Payment Term Extension | |||
Covered Loans | |||
Total Modifications | $ 254 |
Covered Assets and Indemnific87
Covered Assets and Indemnification Asset - Aging (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Covered Assets and Indemnification Asset | ||
Total loans | $ 4,999,529 | $ 3,920,476 |
Covered | ||
Covered Assets and Indemnification Asset | ||
Total loans | 422,417 | 642,640 |
Covered | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 251,018 | 435,388 |
Covered | Secured | ||
Covered Assets and Indemnification Asset | ||
Total loans | 12,237 | 22,765 |
Covered | Secured | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 6,818 | 13,630 |
Covered | Unsecured | ||
Covered Assets and Indemnification Asset | ||
Total loans | 2,735 | 8,015 |
Covered | Unsecured | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 2,735 | 6,805 |
Covered | Secured by commercial properties | ||
Covered Assets and Indemnification Asset | ||
Total loans | 143,821 | 270,329 |
Covered | Secured by commercial properties | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 112,549 | 227,772 |
Covered | Secured by residential properties | ||
Covered Assets and Indemnification Asset | ||
Total loans | 229,570 | 282,521 |
Covered | Secured by residential properties | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 104,946 | 141,192 |
Covered | Residential construction loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 1,161 | 1,640 |
Covered | Residential construction loans | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 118 | 354 |
Covered | Commercial construction loans and land development | ||
Covered Assets and Indemnification Asset | ||
Total loans | 32,893 | 57,370 |
Covered | Commercial construction loans and land development | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 23,852 | 45,635 |
Bank | Covered | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 30-59 Days | 6,546 | 4,014 |
Loans past Due 60-89 Days | 1,096 | 518 |
Loans past Due 90 Days or More | 3,422 | 1,868 |
Total Past Due Loans | 11,064 | 6,400 |
Current Loans | 160,335 | 200,852 |
Total loans | 422,417 | 642,640 |
Accruing Loans Past Due 90 Days or More | 2,094 | 67 |
Bank | Covered | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 251,018 | 435,388 |
Bank | Covered | Secured | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 30-59 Days | 3,853 | |
Loans past Due 90 Days or More | 71 | 454 |
Total Past Due Loans | 3,924 | 454 |
Current Loans | 1,495 | 8,681 |
Total loans | 12,237 | 22,765 |
Accruing Loans Past Due 90 Days or More | 11 | |
Bank | Covered | Secured | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 6,818 | 13,630 |
Bank | Covered | Unsecured | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 30-59 Days | 10 | |
Total Past Due Loans | 10 | |
Current Loans | 1,200 | |
Total loans | 2,735 | 8,015 |
Bank | Covered | Unsecured | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 2,735 | 6,805 |
Bank | Covered | Secured by commercial properties | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 30-59 Days | 171 | 876 |
Loans past Due 60-89 Days | 409 | |
Loans past Due 90 Days or More | 436 | 105 |
Total Past Due Loans | 1,016 | 981 |
Current Loans | 30,256 | 41,576 |
Total loans | 143,821 | 270,329 |
Accruing Loans Past Due 90 Days or More | 335 | |
Bank | Covered | Secured by commercial properties | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 112,549 | 227,772 |
Bank | Covered | Secured by residential properties | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 30-59 Days | 2,484 | 3,089 |
Loans past Due 60-89 Days | 687 | 493 |
Loans past Due 90 Days or More | 2,045 | 405 |
Total Past Due Loans | 5,216 | 3,987 |
Current Loans | 119,408 | 137,342 |
Total loans | 229,570 | 282,521 |
Accruing Loans Past Due 90 Days or More | 1,672 | 48 |
Bank | Covered | Secured by residential properties | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 104,946 | 141,192 |
Bank | Covered | Residential construction loans | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 90 Days or More | 775 | 896 |
Total Past Due Loans | 775 | 896 |
Current Loans | 268 | 390 |
Total loans | 1,161 | 1,640 |
Bank | Covered | Residential construction loans | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | 118 | 354 |
Bank | Covered | Commercial construction loans and land development | ||
Covered Assets and Indemnification Asset | ||
Loans past Due 30-59 Days | 38 | 39 |
Loans past Due 60-89 Days | 25 | |
Loans past Due 90 Days or More | 95 | 8 |
Total Past Due Loans | 133 | 72 |
Current Loans | 8,908 | 11,663 |
Total loans | 32,893 | 57,370 |
Accruing Loans Past Due 90 Days or More | 87 | 8 |
Bank | Covered | Commercial construction loans and land development | PCI loans | ||
Covered Assets and Indemnification Asset | ||
Total loans | $ 23,852 | $ 45,635 |
Covered Assets and Indemnific88
Covered Assets and Indemnification Asset - Internal Risk Grades (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Internal risk grades of covered loans in the portfolio | ||
Total | $ 4,999,529 | $ 3,920,476 |
Covered | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 422,417 | 642,640 |
Covered | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 251,018 | 435,388 |
Covered | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 153,519 | 188,420 |
Covered | Special Mention | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 499 | |
Covered | Substandard | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 17,381 | 18,832 |
Covered | Secured | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 12,237 | 22,765 |
Covered | Secured | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 6,818 | 13,630 |
Covered | Secured | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 4,848 | 7,712 |
Covered | Secured | Substandard | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 571 | 1,423 |
Covered | Unsecured | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 2,735 | 8,015 |
Covered | Unsecured | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 2,735 | 6,805 |
Covered | Unsecured | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 1,210 | |
Covered | Secured by commercial properties | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 143,821 | 270,329 |
Covered | Secured by commercial properties | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 112,549 | 227,772 |
Covered | Secured by commercial properties | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 26,025 | 35,973 |
Covered | Secured by commercial properties | Substandard | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 5,247 | 6,584 |
Covered | Secured by residential properties | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 229,570 | 282,521 |
Covered | Secured by residential properties | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 104,946 | 141,192 |
Covered | Secured by residential properties | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 115,201 | 133,756 |
Covered | Secured by residential properties | Special Mention | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 499 | |
Covered | Secured by residential properties | Substandard | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 8,924 | 7,573 |
Covered | Residential construction loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 1,161 | 1,640 |
Covered | Residential construction loans | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 118 | 354 |
Covered | Residential construction loans | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 265 | 268 |
Covered | Residential construction loans | Substandard | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 778 | 1,018 |
Covered | Commercial construction loans and land development | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 32,893 | 57,370 |
Covered | Commercial construction loans and land development | PCI loans | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 23,852 | 45,635 |
Covered | Commercial construction loans and land development | Pass | ||
Internal risk grades of covered loans in the portfolio | ||
Total | 7,180 | 9,501 |
Covered | Commercial construction loans and land development | Substandard | ||
Internal risk grades of covered loans in the portfolio | ||
Total | $ 1,861 | $ 2,234 |
Covered Assets and Indemnific89
Covered Assets and Indemnification Asset - Allowance (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Dec. 31, 2014 | |
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | $ 37,041 | |||||
Provision charged to (recapture from) operations operations | $ 5,593 | $ 4,033 | 8,438 | $ 12,808 | ||
Balance, end of period | 42,989 | 42,989 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | $ 4,999,529 | $ 3,920,476 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 42,989 | 37,041 | 42,989 | 37,041 | ||
Covered | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 934 | 4,115 | 4,611 | 1,061 | ||
Provision charged to (recapture from) operations operations | 1,313 | (153) | 779 | 3,151 | ||
Loans charged off | (365) | (201) | (3,627) | (451) | ||
Recoveries on charged off loans | 107 | |||||
Recoveries (reversal) on charged off loans | (12) | |||||
Balance, end of period | 1,870 | 3,761 | 1,870 | 3,761 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment | 775 | 801 | ||||
Loans collectively evaluated for impairment | 170,624 | 206,451 | ||||
Total loans | 422,417 | 642,640 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 48 | 77 | ||||
Total loans, allowance | 934 | 4,115 | 4,611 | 1,061 | 1,870 | 4,611 |
Covered | Commercial and industrial | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 130 | 1,146 | 1,193 | 1,053 | ||
Provision charged to (recapture from) operations operations | (100) | (211) | (230) | (27) | ||
Loans charged off | 38 | (915) | (91) | |||
Recoveries on charged off loans | 6 | |||||
Recoveries (reversal) on charged off loans | (14) | |||||
Balance, end of period | 54 | 935 | 54 | 935 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment | 5,419 | 10,345 | ||||
Total loans | 14,972 | 30,780 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 19 | 46 | ||||
Total loans, allowance | 130 | 1,146 | 1,193 | 1,053 | 54 | 1,193 |
Covered | Real estate | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 469 | 2,551 | 3,334 | 8 | ||
Provision charged to (recapture from) operations operations | 851 | (342) | 186 | 2,245 | ||
Loans charged off | (403) | (169) | (2,702) | (213) | ||
Recoveries on charged off loans | 2 | 101 | ||||
Balance, end of period | 919 | 2,040 | 919 | 2,040 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment | 155,896 | 183,886 | ||||
Total loans | 373,391 | 552,850 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 26 | 16 | ||||
Total loans, allowance | 469 | 2,551 | 3,334 | 8 | 919 | 3,334 |
Covered | Construction and land development | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 335 | 418 | 84 | |||
Provision charged to (recapture from) operations operations | 562 | 400 | 823 | 933 | ||
Loans charged off | (32) | (10) | (147) | |||
Balance, end of period | 897 | 786 | 897 | 786 | ||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Loans individually evaluated for impairment | 775 | 801 | ||||
Loans collectively evaluated for impairment | 9,309 | 12,220 | ||||
Total loans | 34,054 | 59,010 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Loans collectively evaluated for impairment, allowance | 3 | 15 | ||||
Total loans, allowance | 335 | $ 418 | 84 | $ 786 | 897 | 84 |
Covered | PCI loans | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 4,534 | |||||
Balance, end of period | 1,822 | 1,822 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 251,018 | 435,388 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 1,822 | 4,534 | 1,822 | 4,534 | ||
Covered | PCI loans | Commercial and industrial | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 1,147 | |||||
Balance, end of period | 35 | 35 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 9,553 | 20,435 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 35 | 1,147 | 35 | 1,147 | ||
Covered | PCI loans | Real estate | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 3,318 | |||||
Balance, end of period | 893 | 893 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 217,495 | 368,964 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | 893 | 3,318 | 893 | 3,318 | ||
Covered | PCI loans | Construction and land development | ||||||
Changes in the allowance for loan losses | ||||||
Balance, beginning of period | 69 | |||||
Balance, end of period | 894 | 894 | ||||
Loan portfolio distributed by portfolio segment and impairment methodology | ||||||
Total loans | 23,970 | 45,989 | ||||
Allowance for loan losses distributed by portfolio segment and impairment methodology | ||||||
Total loans, allowance | $ 894 | $ 69 | $ 894 | $ 69 |
Covered Assets and Indemnific90
Covered Assets and Indemnification Asset - Covered OREO (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Activity in covered OREO | ||||
Balance, beginning of period | $ 136,945 | |||
Balance, end of period | $ 106,024 | 106,024 | ||
Covered | ||||
Activity in covered OREO | ||||
Balance, beginning of period | 125,510 | $ 142,174 | 136,945 | $ 142,833 |
Additions to covered OREO | 3,516 | 10,214 | 39,579 | 42,206 |
Dispositions of covered OREO | (17,632) | (11,150) | (61,072) | (40,842) |
Valuation adjustments in the period | (5,370) | (14,440) | (9,428) | (17,399) |
Balance, end of period | $ 106,024 | $ 126,798 | $ 106,024 | $ 126,798 |
Covered Assets and Indemnific91
Covered Assets and Indemnification Asset - FDIC Indemnification Asset (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Activity in the FDIC Indemnification Asset | ||||
Balance, beginning of period | $ 102,381 | $ 175,114 | $ 130,437 | $ 188,291 |
FDIC Indemnification Asset accretion (amortization) | 201 | 825 | 1,027 | 2,672 |
Transfers to due from FDIC and other | (9,680) | (26,151) | (38,562) | (41,175) |
Balance, end of period | $ 92,902 | $ 149,788 | 92,902 | $ 149,788 |
FDIC, collections received | $ 98,900 |
Mortgage Servicing Rights (Deta
Mortgage Servicing Rights (Details) - MSR - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Change in fair value of mortgage servicing rights | |||||
Balance, beginning of period | $ 44,985 | $ 35,877 | $ 36,155 | $ 20,149 | $ 20,149 |
Additions | 11,025 | 18,982 | 23,121 | 33,790 | |
Sales | (11,387) | (11,387) | |||
Changes in fair value: Due to changes in model inputs or assumptions | (7,030) | (1,024) | (6,302) | 627 | |
Changes in fair value: Due to customer payments | (1,453) | (541) | (5,447) | (1,272) | |
Balance, end of period | 47,527 | 41,907 | 47,527 | 41,907 | $ 36,155 |
Mortgage loans serviced for others | $ 5,042,199 | $ 3,645,220 | $ 5,042,199 | $ 3,645,220 | |
MSR asset as a percentage of serviced mortgage loans | 0.94% | 0.99% | |||
Key Assumptions | |||||
Weighted average constant prepayment rate (as a percent) | 13.68% | 12.17% | |||
Weighted average discount rate (as a percent) | 10.93% | 11.01% | |||
Weighted average life | 5 years 9 months 18 days | 6 years 3 months 18 days |
Mortgage Servicing Rights - Sen
Mortgage Servicing Rights - Sensitivity Analysis (Details) - MSR - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Sensitivity analysis | |||||
Constant prepayment rate: Impact of 10% adverse change | $ (2,180) | $ (2,180) | $ (1,648) | ||
Constant prepayment rate: Impact of 20% adverse change | (4,181) | (4,181) | (3,169) | ||
Discount rate: Impact of 10% adverse change | (1,722) | (1,722) | (1,431) | ||
Discount rate: Impact of 20% adverse change | (3,322) | (3,322) | $ (2,753) | ||
Contractually specified servicing fees, late fees and ancillary fees | $ 5,200 | $ 3,100 | $ 13,700 | $ 8,100 |
Deposits (Details)
Deposits (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Deposits | ||
Noninterest-bearing demand | $ 2,173,890 | $ 2,076,385 |
Interest-bearing: | ||
NOW accounts | 1,006,263 | 1,242,110 |
Money market | 1,457,984 | 861,851 |
Brokered - money market | 70,196 | 79,937 |
Demand | 415,604 | 136,886 |
Savings | 266,833 | 299,051 |
Time | 1,368,973 | 1,575,910 |
Brokered - time | 61,006 | 97,762 |
Total deposits | $ 6,820,749 | $ 6,369,892 |
Short-term Borrowings (Details)
Short-term Borrowings (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Short-term borrowings | |||
Short-term borrowings | $ 910,490 | $ 762,696 | |
Hilltop Broker-Dealers | |||
Federal Funds Purchased, Securities Sold under Agreements to Repurchase, and FHLB Advances | |||
Weighted average interest rate (as a percent) | 1.24% | 1.07% | |
Federal funds purchased. | |||
Short-term borrowings | |||
Short-term borrowings | $ 103,900 | $ 128,100 | |
Securities sold under agreement to repurchase. | |||
Short-term borrowings | |||
Short-term borrowings | 199,890 | 136,396 | |
Federal Home Loan Bank notes | |||
Short-term borrowings | |||
Short-term borrowings | 375,000 | $ 375,000 | |
Federal Funds Purchased, Securities Sold under Agreements to Repurchase, and FHLB Advances | |||
Average balance during the period | $ 314,780 | $ 258,849 | |
Average interest rate during the period (as a percent) | 0.24% | 0.17% | |
Average interest rate at end of period (as a percent) | 0.27% | 0.16% | |
Federal Home Loan Bank notes | Maximum | |||
Federal Funds Purchased, Securities Sold under Agreements to Repurchase, and FHLB Advances | |||
Maturity term of debt | 365 days | ||
Short-term bank loans. | |||
Short-term borrowings | |||
Short-term borrowings | $ 231,700 | $ 123,200 | |
Schedule of federal funds purchased and securities sold under agreements to repurchase | |||
Federal Funds Purchased, Securities Sold under Agreements to Repurchase, and FHLB Advances | |||
Average balance during the period | $ 313,765 | $ 326,936 | |
Average interest rate during the period (as a percent) | 0.31% | 0.17% | |
Average interest rate at end of period (as a percent) | 0.18% | 0.15% | |
Carrying value. | $ 233,300 | $ 166,734 | |
Estimated fair value | $ 234,007 | $ 163,852 |
Notes Payable (Details)
Notes Payable (Details) $ in Millions | Apr. 09, 2015USD ($) |
Non-Cumulative Perpetual Preferred Stock, Series B | |
Notes payable | |
Aggregate liquidation value | $ 114.1 |
Unpaid dividend | 0.4 |
Senior Exchangeable Notes 5.00 Percent Due 2025 | Private Placement | |
Notes payable | |
Aggregate principal amount | $ 150 |
Interest rate (as a percent) | 5.00% |
Net proceeds from the offering, after deducting estimated fee and expenses and the initial purchaser’ discounts | $ 148 |
Period before maturity for redemption of Senior Notes | 3 months |
Percentage of redemption price | 100.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | Jan. 01, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 |
Net operating loss carryforwards | ||||||
Effective income tax rate (as a percent) | 34.90% | 35.80% | 23.50% | 36.10% | ||
Bargain purchase gain | $ 81,289 | |||||
Income tax benefit | $ (25,338) | $ (14,010) | (58,895) | $ (44,658) | ||
Valuation allowance on deferred tax assets for net operating loss carryforwards | 2,200 | 2,200 | ||||
Increase (decrease) in the valuation allowance | 300 | |||||
Valuation allowance on remainder of deferred tax assets | 0 | 0 | $ 0 | |||
Uncertain tax positions | ||||||
Unrecognized Tax Benefits | 900 | 900 | ||||
Unrecognized tax benefits if recognized would favorably impact the effective tax rate | 600 | 600 | ||||
Internal Revenue Service (IRS) | ||||||
Net operating loss carryforwards | ||||||
Net operating loss carryforwards | $ 90,900 | 90,900 | $ 45,500 | |||
SWS | ||||||
Net operating loss carryforwards | ||||||
Tax on bargain purchase gain | $ 0 | 0 | ||||
Bargain purchase gain | $ 81,289 | |||||
Income tax benefit | 2,100 | |||||
Increase in valuation allowance resulting from SWS merger | 2,200 | |||||
SWS | Capital Loss Carryforward Valuation Allowance | ||||||
Net operating loss carryforwards | ||||||
Increase (decrease) in the valuation allowance | $ (1,900) |
Employee Benefits (Details)
Employee Benefits (Details) | 9 Months Ended |
Sep. 30, 2015 | |
Employee Benefits | |
Deferred compensation plan, matching percentage | 15.00% |
Deferred compensation plan, vesting period | 4 years |
Commitments and Contingencies99
Commitments and Contingencies (Details) shares in Thousands, $ in Thousands | Sep. 13, 2013USD ($)item | Nov. 02, 2012USD ($)item | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)shares | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($) | Apr. 30, 2014item |
Commitments and Contingencies | |||||||||
Number of shares of SWS common stock held by purported shareholders | shares | 8,430 | ||||||||
Representation and Warranty Claims | |||||||||
Roll-forward of claims activity for loans put-back to the mortgage origination segment | |||||||||
Balance, beginning of period | $ 72,564 | $ 53,123 | $ 53,906 | $ 51,912 | |||||
Claims made | 9,787 | 13,336 | 61,768 | 35,179 | |||||
Claims resolved with no payment | (12,178) | (8,329) | (34,877) | (17,660) | |||||
Repurchases | (4,333) | (3,173) | (12,647) | (12,411) | |||||
Indemnification payments | (11,921) | (1,168) | (14,231) | (3,231) | |||||
Balance, end of period | 53,919 | 53,789 | 53,919 | 53,789 | |||||
Reserve for Indemnification Liability: | |||||||||
Total | 72,564 | 53,123 | 53,906 | 51,912 | $ 53,919 | $ 53,906 | |||
Reserve for Indemnification liability established by mortgage origination segment | |||||||||
Commitments and Contingencies | |||||||||
Provision for indemnification losses | 1,100 | 900 | 3,100 | 2,300 | |||||
Roll-forward of claims activity for loans put-back to the mortgage origination segment | |||||||||
Balance, beginning of period | 17,279 | 19,688 | 17,619 | 21,121 | |||||
Additions for new sales | 1,092 | 883 | 3,086 | 2,295 | |||||
Repurchases | (408) | (388) | (1,206) | (1,416) | |||||
Early payment defaults | (5) | (24) | (44) | (101) | |||||
Indemnification payments | (1,831) | (542) | (2,872) | (1,654) | |||||
Change in estimate | (18) | (508) | (474) | (1,136) | |||||
Balance, end of period | 16,109 | 19,109 | 16,109 | 19,109 | |||||
Reserve for Indemnification Liability: | |||||||||
Specific claims | 5,239 | 7,912 | |||||||
Incurred but not reported claims | 10,870 | 9,707 | |||||||
Total | $ 17,279 | $ 19,688 | 17,619 | $ 21,121 | $ 16,109 | $ 17,619 | |||
Shareholder Class Action Lawsuits | |||||||||
Commitments and Contingencies | |||||||||
Number of purported shareholder class action lawsuits | item | 2 | ||||||||
Bank | FNB | |||||||||
Reserve for Indemnification Liability: | |||||||||
Number of loss-sharing agreements | item | 2 | ||||||||
Loans and OREO acquired | $ 1,200,000 | ||||||||
Percentage of net losses to be absorbed by FDIC on the first $240.4 million of net losses incurred as per the loss sharing agreement | 80.00% | ||||||||
Threshold amount of net losses incurred for 80% of net losses to be absorbed by FDIC as per the loss sharing agreement, first layer | $ 240,400 | ||||||||
Percentage of net losses to be absorbed by FDIC in excess of $240.4 million up to and including $365.7 million of net losses incurred as per the loss sharing agreement | 0.00% | ||||||||
Threshold amount of net losses incurred for 0% of net losses to be absorbed by FDIC as per the loss sharing agreement, second layer | $ 365,700 | ||||||||
Percentage of net losses to be absorbed by FDIC in excess of $365.7 million of net losses incurred as per the loss sharing agreement | 80.00% | ||||||||
Threshold limit of subsequent recoveries reimbursable to the FDIC under the loss share agreement | $ 0 | ||||||||
Period for which payment is required to be made to the FDIC of true-up amount | 10 years | ||||||||
Covered net losses billed to the FDIC | $ 123,700 | ||||||||
Percentage of covered net losses reimbursable under the loss-share agreements | 80.00% | ||||||||
Amount of covered net losses reimbursable under the loss-share agreements | $ 98,900 | ||||||||
Aggregate reimbursements received | 98,900 | ||||||||
Bank | FNB | Covered | Commercial loan | |||||||||
Reserve for Indemnification Liability: | |||||||||
Period of loss-sharing agreements in effect | 5 years | ||||||||
Period of loss recovery provisions in effect | 8 years | ||||||||
Bank | FNB | Covered | Single family residential loans | |||||||||
Reserve for Indemnification Liability: | |||||||||
Period of loss-sharing agreements in effect | 10 years | ||||||||
Period of loss recovery provisions in effect | 10 years | ||||||||
Bank | FNB | Minimum | |||||||||
Reserve for Indemnification Liability: | |||||||||
Covered losses and reimbursable expenses | 240,400 | ||||||||
Bank | FNB | Maximum | |||||||||
Reserve for Indemnification Liability: | |||||||||
Covered losses and reimbursable expenses | $ 365,700 | ||||||||
First Southwest Company | |||||||||
Commitments and Contingencies | |||||||||
Number of defendants other than reporting entity | item | 13 | ||||||||
Amount of bonds to finance a loan to 38 Studios | $ 75,000 |
Financial Instruments with O100
Financial Instruments with Off-Balance Sheet Risk (Details) $ in Millions | Sep. 30, 2015USD ($) |
Unused commitments to extend credit | |
Financial Instruments with Off-Balance Sheet Risk | |
Outstanding commitments | $ 1,600 |
Standby letters of credit | |
Financial Instruments with Off-Balance Sheet Risk | |
Outstanding commitments | $ 45.5 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 01, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 |
Stock based compensation | |||||||
Compensation expense | $ 2 | $ 1.3 | $ 6.2 | $ 3.3 | |||
Restricted Stock Awards | 2015 Grant Date | SWS | |||||||
Stock based compensation | |||||||
Number of shares awarded to certain executives and key employees | 62,994 | ||||||
Number of shares awarded to certain executives and key employees outstanding | 12,118 | 12,118 | |||||
Vesting period | 3 years | ||||||
Weighted average grant date fair value of awards (in dollars per share) | $ 19.95 | ||||||
Unrecognized compensation expense | $ 0.2 | $ 0.2 | |||||
2012 Plan | |||||||
Stock based compensation | |||||||
Number of awards approved for grant (in shares) | 4,000,000 | 4,000,000 | |||||
Common stock remaining available for issuance (in shares) | 3,947,579 | 3,947,579 | |||||
2012 Plan | RSUs | 2015 Grant Date | |||||||
Stock based compensation | |||||||
Number of shares awarded to certain executives and key employees | 459,975 | ||||||
Number of shares awarded to certain executives and key employees outstanding | 449,110 | 449,110 | |||||
Awards subject to time-based vesting (in shares) | 353,272 | ||||||
Number of awards vesting upon achievement of performance goals (in shares) | 95,838 | ||||||
Performance period | 3 years | ||||||
Weighted average grant date fair value of awards (in dollars per share) | $ 19.51 | ||||||
Unrecognized compensation expense | $ 7.4 | $ 7.4 | |||||
Transfer restrictions period | 1 year | ||||||
2012 Plan | RSUs | 2014 Grant Date | |||||||
Stock based compensation | |||||||
Number of shares awarded to certain executives and key employees | 444,175 | ||||||
2012 Plan | RSUs | 2014 and 2013 Grant Date | |||||||
Stock based compensation | |||||||
Number of shares awarded to certain executives and key employees outstanding | 411,325 | 411,325 | |||||
2012 Plan | Restricted Stock Awards | 2013 Grant Date | |||||||
Stock based compensation | |||||||
Number of shares awarded to certain executives and key employees | 471,000 | ||||||
Number of shares awarded to certain executives and key employees outstanding | 444,000 | 444,000 | |||||
2012 Plan | RSUs and RSAs | 2014 and 2013 Grant Date | |||||||
Stock based compensation | |||||||
Unrecognized compensation expense | $ 6.1 | $ 6.1 | |||||
2012 Plan | Board of Directors | |||||||
Stock based compensation | |||||||
Common shares granted to members of board of directors as compensation for director services | 8,219 | 7,227 |
Regulatory Matters - Minimum Ca
Regulatory Matters - Minimum Capital Requirments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Bank | ||
Tier 1 capital (to average assets) | ||
Actual Amount | $ 1,035,196 | $ 845,656 |
Actual Ratio (as a percent) | 12.77% | 10.31% |
Minimum Capital Requirements, Amount | $ 324,201 | $ 328,025 |
Minimum Capital Requirements, Ratio (as a percent) | 4.00% | 4.00% |
To Be Well Capitalized Minimum Capital Requirements, Amount | $ 405,252 | $ 410,031 |
To Be Well Capitalized Minimum Capital Requirements, Ratio (as a percent) | 5.00% | 5.00% |
Common equity Tier 1 capital (to risk weighted assets) | ||
Actual Amount | $ 1,035,196 | |
Actual Ratio (as a percent) | 17.36% | |
Minimum Capital Requirements, Amount | $ 268,374 | |
Minimum Capital Requirements, Ratio (as a percent) | 4.50% | |
To Be Well Capitalized Minimum Capital Requirements, Amount | $ 387,652 | |
To Be Well Capitalized Minimum Capital Requirements, Ratio (as a percent) | 6.50% | |
Tier 1 capital (to risk-weighted assets) | ||
Actual Amount | $ 1,035,196 | $ 845,656 |
Actual Ratio (as a percent) | 17.36% | 13.74% |
Minimum Capital Requirements, Amount | $ 357,832 | $ 246,099 |
Minimum Capital Requirements, Ratio (as a percent) | 6.00% | 4.00% |
To Be Well Capitalized Minimum Capital Requirements, Amount | $ 477,110 | $ 369,148 |
To Be Well Capitalized Minimum Capital Requirements, Ratio (as a percent) | 8.00% | 6.00% |
Total capital (to risk-weighted assets) | ||
Actual Amount | $ 1,081,368 | $ 888,744 |
Actual Ratio (as a percent) | 18.13% | 14.45% |
Minimum Capital Requirements, Amount | $ 477,110 | $ 492,198 |
Minimum Capital Requirements, Ratio (as a percent) | 8.00% | 8.00% |
To Be Well Capitalized Minimum Capital Requirements, Amount | $ 596,387 | $ 615,247 |
To Be Well Capitalized Minimum Capital Requirements, Ratio (as a percent) | 10.00% | 10.00% |
Hilltop Holdings Inc. | ||
Tier 1 capital (to average assets) | ||
Actual Amount | $ 1,481,139 | $ 1,231,724 |
Actual Ratio (as a percent) | 12.01% | 14.17% |
Minimum Capital Requirements, Amount | $ 493,154 | $ 347,619 |
Minimum Capital Requirements, Ratio (as a percent) | 4.00% | 4.00% |
Common equity Tier 1 capital (to risk weighted assets) | ||
Actual Amount | $ 1,439,487 | |
Actual Ratio (as a percent) | 18.36% | |
Minimum Capital Requirements, Amount | $ 352,803 | |
Minimum Capital Requirements, Ratio (as a percent) | 4.50% | |
Tier 1 capital (to risk-weighted assets) | ||
Actual Amount | $ 1,481,139 | $ 1,231,724 |
Actual Ratio (as a percent) | 18.89% | 19.02% |
Minimum Capital Requirements, Amount | $ 470,405 | $ 259,078 |
Minimum Capital Requirements, Ratio (as a percent) | 6.00% | 4.00% |
Total capital (to risk-weighted assets) | ||
Actual Amount | $ 1,511,992 | $ 1,275,023 |
Actual Ratio (as a percent) | 19.29% | 19.69% |
Minimum Capital Requirements, Amount | $ 627,206 | $ 518,157 |
Minimum Capital Requirements, Ratio (as a percent) | 8.00% | 8.00% |
Regulatory Matters - Net Capita
Regulatory Matters - Net Capital Position, Broker-Dealers (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Net Capital | ||
Amount required to be segregated in cash and securities for the benefit of customers | $ 228,251 | $ 76,013 |
First Southwest Company | ||
Net Capital | ||
Net capital | 70,575 | |
Less required net capital | 4,923 | |
Excess net capital | $ 65,652 | |
Net capital as a percentage of aggregate debits | 28.70% | |
Net capital in excess of 5% aggregate debt items | $ 58,267 | |
Hilltop Securities | ||
Net Capital | ||
Net capital | 151,579 | |
Less required net capital | 7,273 | |
Excess net capital | $ 144,306 | |
Net capital as a percentage of aggregate debits | 41.70% | |
Net capital in excess of 5% aggregate debt items | $ 133,395 | |
HTS Independent Network | ||
Net Capital | ||
Net capital | 1,398 | |
Less required net capital | 250 | |
Excess net capital | 1,148 | |
Hilltop Broker-Dealers | ||
Net Capital | ||
Amount required to be segregated in cash and securities for the benefit of customers | 227,300 | $ 76,000 |
Amount required to be segregated in cash and securities for the benefit of proprietary accounts of introducing broker-dealers | $ 1,000 |
Regulatory Matters - Insurance
Regulatory Matters - Insurance Subsidiaries (Details) - Texas Department of Insurance - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
NLIC | |||||
Insurance | |||||
Capital and surplus | $ 117,912 | $ 117,912 | $ 113,023 | ||
Statutory net income | 7,901 | $ 6,106 | 3,826 | $ 7,428 | |
ASIC | |||||
Insurance | |||||
Capital and surplus | 29,736 | 29,736 | $ 28,964 | ||
Statutory net income | $ 76 | $ (418) | $ 643 | $ 958 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | |
Stockholders' Equity Note | |||
Authorized amount | $ 30,000 | ||
Payments to repurchase and retire shares | $ 13,000 | $ 30,028 | |
Repurchased and retired (in shares) | 1,390,977 | ||
Repurchased and retired, average (per share) | $ 21.56 |
Derivative Financial Instrum106
Derivative Financial Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Not Designated as Hedging Instrument | Prime Lending | |||||
Derivative financial instruments | |||||
Net gain (loss) due to changes in the fair value of the derivative instruments | $ 15,500 | $ 200 | $ 17,800 | $ (5,000) | |
Not Designated as Hedging Instrument | Hilltop Broker-Dealers | |||||
Derivative financial instruments | |||||
Net gain (loss) due to changes in the fair value of the derivative instruments | 12,700 | $ 5,300 | 30,500 | $ 11,400 | |
Interest Rate Lock Commitments | |||||
Derivative financial instruments | |||||
Notional Amount | 1,135,528 | 1,135,528 | $ 621,216 | ||
Estimated Fair Value | 34,539 | 34,539 | 17,057 | ||
Commitments to Purchase MBSs | |||||
Derivative financial instruments | |||||
Notional Amount | 3,518,621 | 3,518,621 | 510,553 | ||
Estimated Fair Value | 23,980 | 23,980 | 6,040 | ||
Commitments to Sell MBSs | |||||
Derivative financial instruments | |||||
Notional Amount | 5,381,861 | 5,381,861 | 1,968,768 | ||
Estimated Fair Value | (24,678) | (24,678) | (12,566) | ||
Commitments to Sell MBSs | Prime Lending | |||||
Derivative financial instruments | |||||
Cash collateral advanced to offset net derivative liability | 8,400 | 8,400 | 6,600 | ||
Interest Rate Swap and Swaptions | |||||
Derivative financial instruments | |||||
Notional Amount | 275,566 | 275,566 | 83,000 | ||
Estimated Fair Value | 1,406 | 1,406 | 425 | ||
Interest Rate Swap and Swaptions | Prime Lending | |||||
Derivative financial instruments | |||||
Cash collateral advanced to offset net derivative liability | $ 4,000 | $ 4,000 | $ 3,300 |
Balance Sheet Offsetting - Asse
Balance Sheet Offsetting - Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Reverse Repurchase Agreements | ||
Net Amounts of Assets Presented in the Balance Sheet | $ 83,889 | |
Total | ||
Gross Amounts of Recognized Assets | 2,132,145 | $ 153,365 |
Gross Amounts Offset in the Balance Sheet | (348) | |
Net Amounts of Assets Presented in the Balance Sheet | 2,131,797 | 153,365 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (2,129,142) | (152,899) |
Net Amount | 2,655 | 466 |
Institutional counterparties | ||
Securities Borrowed: | ||
Gross Amounts of Recognized Assets | 2,036,392 | 152,899 |
Net Amounts of Assets Presented in the Balance Sheets | 2,036,392 | 152,899 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (2,036,392) | (152,899) |
Interest Rate Swap and Swaptions | Institutional counterparties | ||
Derivatives | ||
Gross Amounts of Recognized Assets | 2,864 | 425 |
Gross Amounts Offset in the Balance Sheets | (348) | |
Net Amounts of Assets Presented in the Balance Sheets | 2,516 | 425 |
Gross Amounts Not Offset in the Balance Sheets | ||
Net Amount | 2,516 | 425 |
Reverse repurchase agreements | Institutional counterparties | ||
Reverse Repurchase Agreements | ||
Gross Amounts of Recognized Assets | 83,889 | |
Net Amounts of Assets Presented in the Balance Sheet | 83,889 | |
Financial Instruments | (83,750) | |
Net Amount | 139 | |
Forward MBS Derivatives | Institutional counterparties | ||
Derivatives | ||
Gross Amounts of Recognized Assets | 9,000 | 41 |
Net Amounts of Assets Presented in the Balance Sheets | 9,000 | 41 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | $ (9,000) | |
Net Amount | $ 41 |
Balance Sheet Offsetting - Liab
Balance Sheet Offsetting - Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Total | ||
Gross Amounts of Recognized Liabilities | $ 2,155,848 | $ 267,047 |
Gross Amounts Offset in the Balance Sheets | (347) | (223) |
Net Amounts of Liabilities Presented in the Balance Sheets | 2,155,501 | 266,824 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (2,144,085) | (254,218) |
Cash Collateral Pledged | (6,137) | |
Net Amount | 11,416 | 6,469 |
Institutional counterparties | ||
Securities Loaned: | ||
Gross Amounts of Recognized Liabilities | 1,929,588 | 117,822 |
Net Amounts of Liabilities Presented in the Balance Sheets | 1,929,588 | 117,822 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (1,929,588) | (117,822) |
Institutional counterparties | Interest Rate Swap and Swaptions | ||
Derivatives: | ||
Gross Amounts of Recognized Liabilities | 1,110 | |
Net Amounts of Liabilities Presented in the Balance Sheets | 1,110 | |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (2,558) | |
Net Amount | (1,448) | |
Institutional counterparties | Repurchase agreements | ||
Repurchase Agreement: | ||
Gross Amounts of Recognized Liabilities | 68,532 | |
Net Amounts of Liabilities Presented in the Balance Sheets | 68,532 | |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (68,532) | |
Institutional counterparties | Forward MBS Derivatives | ||
Derivatives: | ||
Gross Amounts of Recognized Liabilities | 25,260 | 12,829 |
Gross Amounts Offset in the Balance Sheets | (347) | (223) |
Net Amounts of Liabilities Presented in the Balance Sheets | 24,913 | 12,606 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | (12,049) | |
Cash Collateral Pledged | (6,137) | |
Net Amount | 12,864 | 6,469 |
Customer counterparties | Repurchase agreements | ||
Repurchase Agreement: | ||
Gross Amounts of Recognized Liabilities | 131,358 | 136,396 |
Net Amounts of Liabilities Presented in the Balance Sheets | 131,358 | 136,396 |
Gross Amounts Not Offset in the Balance Sheets | ||
Financial Instruments | $ (131,358) | $ (136,396) |
Balance Sheet Offsetting - Secu
Balance Sheet Offsetting - Secured Borrowings (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Total borrowings | $ 2,129,478 | $ 254,218 |
Gross amount of recognized liabilities for repurchase agreements and securities lending in offsetting disclosure above | 2,129,478 | 254,218 |
Overnight and Continuous | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Total borrowings | 2,103,298 | 254,218 |
Maturity up to 30 days | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Total borrowings | 24,108 | |
Maturity 30 to 90 Days | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Total borrowings | 2,072 | |
US Treasury and agency securities | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Repurchase agreements transactions | 199,890 | 136,396 |
Securities lending transactions | 12,376 | 9,171 |
US Treasury and agency securities | Overnight and Continuous | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Repurchase agreements transactions | 173,710 | 136,396 |
Securities lending transactions | 12,376 | 9,171 |
US Treasury and agency securities | Maturity up to 30 days | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Repurchase agreements transactions | 24,108 | |
US Treasury and agency securities | Maturity 30 to 90 Days | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Repurchase agreements transactions | 2,072 | |
Corporate securities | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Securities lending transactions | 10,346 | 200 |
Corporate securities | Overnight and Continuous | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Securities lending transactions | 10,346 | 200 |
Equity securities | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Securities lending transactions | 1,906,866 | 108,451 |
Equity securities | Overnight and Continuous | ||
Transfers of Certain Financial Assets Accounted for as Secured Borrowings | ||
Securities lending transactions | $ 1,906,866 | $ 108,451 |
Broker-Dealer and Clearing O110
Broker-Dealer and Clearing Organization Receivables and Payables (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Receivables: | ||
Securities borrowed | $ 2,036,392 | $ 152,899 |
Securities failed to deliver | 26,162 | 3,497 |
Clearing organizations | 15,449 | 11,471 |
Trades in process of settlements, net | 25,092 | |
Other | 8,769 | 17 |
Total receivables | 2,111,864 | 167,884 |
Payables: | ||
Securities loaned | 1,929,588 | 117,822 |
Correspondents | 76,071 | 51,930 |
Securities failed to receive | 36,682 | 5,960 |
Clearing organizations | 3,263 | 3,330 |
Total Payables | $ 2,045,604 | $ 179,042 |
Reserves for Losses and Loss111
Reserves for Losses and Loss Adjustment Expenses (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Information regarding of the reserve for unpaid losses and loss adjustment expenses | ||
Balance, beginning of period | $ 29,716 | $ 27,468 |
Less reinsurance recoverables | (4,315) | (4,508) |
Net balance, beginning of period | 25,401 | 22,960 |
Incurred related to: | ||
Current period | 71,652 | 70,349 |
Prior periods | 5,784 | 5,892 |
Total incurred | 77,436 | 76,241 |
Payments related to: | ||
Current period | (58,523) | (55,701) |
Prior periods | (15,678) | (14,338) |
Total payments | (74,201) | (70,039) |
Net balance, end of period | 28,636 | 29,162 |
Plus reinsurance recoverables | 14,264 | 3,298 |
Balance, end of period | 42,900 | $ 32,460 |
Increase (decrease) in reserves | $ 10,400 |
Reinsurance Activity (Details)
Reinsurance Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Reinsurance Activity | ||||
Carrying value of reinsurance receivables | $ 18,800 | $ 18,800 | ||
Allowance for uncollectible accounts | 0 | 0 | ||
Earned | ||||
Net premiums, Earned | 41,196 | $ 41,821 | 121,081 | $ 122,917 |
Effect of reinsurance on incurred losses | ||||
Loss and LAE incurred | 20,785 | 22,834 | 98,382 | 77,041 |
Reinsurance recoverables | (3,450) | (205) | (20,946) | (800) |
Net loss and LAE incurred | 17,335 | 22,629 | 77,436 | 76,241 |
Property and casualty | ||||
Written | ||||
Premiums from direct business | 41,319 | 42,586 | 130,632 | 134,355 |
Reinsurance assumed | 2,786 | 2,531 | 8,243 | 7,441 |
Reinsurance ceded | (4,316) | (4,604) | (13,758) | (14,085) |
Net premiums, Written | 39,789 | 40,513 | 125,117 | 127,711 |
Earned | ||||
Premiums from direct business | 42,608 | 43,890 | 127,218 | 130,183 |
Reinsurance assumed | 2,627 | 2,338 | 7,617 | 6,536 |
Reinsurance ceded | (4,039) | (4,407) | (13,754) | (13,802) |
Net premiums, Earned | $ 41,196 | $ 41,821 | $ 121,081 | $ 122,917 |
Reinsurance Activity (Details 2
Reinsurance Activity (Details 2) | Jul. 01, 2015USD ($)item | Jun. 30, 2015USD ($) | Sep. 30, 2015USD ($)item |
Multi-line excess of loss coverage | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | $ 500,000 | ||
Reinsurance retention amount | 500,000 | ||
Catastrophic coverage | First layer of protection | |||
Reinsurance activity | |||
Reinsurance retention amount | 8,000,000 | ||
Reinsurance coverage in losses per event | 17,000,000 | ||
Catastrophic coverage | Second layer of protection | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | 25,000,000 | ||
Reinsurance coverage in losses per event | 25,000,000 | ||
Catastrophic coverage | Third layer of protection | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | 25,000,000 | ||
Reinsurance coverage in losses per event | 50,000,000 | ||
Catastrophic coverage | Fourth layer of protection | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | 75,000,000 | ||
Reinsurance coverage in losses per event | 50,000,000 | ||
ASIC | Catastrophic coverage | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | 6,500,000 | ||
Reinsurance retention amount | 1,500,000 | ||
NLIC | Catastrophic coverage | |||
Reinsurance activity | |||
Reinsurance retention amount | 8,000,000 | ||
NLC | Catastrophic coverage | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | $ 10,000,000 | ||
Number of layers of protection under reinsurance | item | 4 | ||
Participation retained (as a percent) | 9.00% | ||
Retention of losses (as a percent) | 9.00% | ||
Renewal period of reinsurance contract | 2 years | ||
NLIC and ASIC | Catastrophic coverage | |||
Reinsurance activity | |||
Reinsurance retention amount | $ 8,000,000 | ||
Number of layers of protection under reinsurance | item | 4 | ||
Number of significant catastrophe experienced | item | 1 | ||
NLIC and ASIC | Catastrophic coverage | Maximum | |||
Reinsurance activity | |||
Reinsurance retention amount | $ 8,000,000 | ||
NLIC and ASIC | Catastrophic coverage | Third layer of protection | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | $ 50,000,000 | ||
Reinsurance coverage in losses per event | 25,000,000 | $ 50,000,000 | |
NLIC and ASIC | Catastrophic coverage | Fourth layer of protection | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | 75,000,000 | ||
Reinsurance coverage in losses per event | 50,000,000 | 40,000,000 | |
NLIC and ASIC | Catastrophic coverage | Third and fourth layer of protection | |||
Reinsurance activity | |||
Loss amount covered under reinsurance contract | $ 125,000,000 | $ 140,000,000 |
Segment and Related Informat114
Segment and Related Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)segment | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
Segment and Related Information | |||||
Number of reportable segments | segment | 4 | ||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | $ 115,211 | $ 85,760 | $ 309,270 | $ 269,627 | |
Provision for loan losses | 5,593 | 4,033 | 8,438 | 12,808 | |
Noninterest income | 296,469 | 212,135 | 950,715 | 585,516 | |
Noninterest expense | 333,502 | 254,744 | 1,001,295 | 718,585 | |
Income before income taxes | 72,585 | 39,118 | 250,252 | 123,750 | |
Goodwill | 251,808 | 251,808 | $ 251,808 | ||
Total assets | 12,389,456 | 12,389,456 | 9,242,416 | ||
Operating segment | Banking | |||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | 105,758 | 78,285 | 280,081 | 248,686 | |
Provision for loan losses | 5,615 | 4,049 | 8,405 | 12,793 | |
Noninterest income | 13,935 | 17,638 | 48,293 | 50,258 | |
Noninterest expense | 60,518 | 67,236 | 179,378 | 188,153 | |
Income before income taxes | 53,560 | 24,638 | 140,591 | 97,998 | |
Goodwill | 207,741 | 207,741 | 207,741 | ||
Total assets | 8,299,022 | 8,299,022 | 8,036,729 | ||
Operating segment | Broker-Dealer | |||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | 8,301 | 3,269 | 24,320 | 9,077 | |
Provision for loan losses | (22) | (16) | 33 | 15 | |
Noninterest income | 83,817 | 29,726 | 243,593 | 80,161 | |
Noninterest expense | 90,683 | 31,782 | 271,826 | 87,507 | |
Income before income taxes | 1,457 | 1,229 | (3,946) | 1,716 | |
Goodwill | 7,008 | 7,008 | 7,008 | ||
Total assets | 3,592,448 | 3,592,448 | 758,636 | ||
Operating segment | Mortgage origination | |||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | (2,538) | (3,197) | (7,829) | (9,726) | |
Noninterest income | 159,794 | 128,989 | 463,314 | 343,572 | |
Noninterest expense | 145,113 | 114,690 | 412,234 | 316,546 | |
Income before income taxes | 12,143 | 11,102 | 43,251 | 17,300 | |
Goodwill | 13,071 | 13,071 | 13,071 | ||
Total assets | 1,565,273 | 1,565,273 | 1,498,846 | ||
Operating segment | Insurance | |||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | 838 | 808 | 2,294 | 2,625 | |
Noninterest income | 43,534 | 44,014 | 128,216 | 129,910 | |
Noninterest expense | 32,366 | 36,636 | 121,893 | 118,398 | |
Income before income taxes | 12,006 | 8,186 | 8,617 | 14,137 | |
Goodwill | 23,988 | 23,988 | 23,988 | ||
Total assets | 350,587 | 350,587 | 328,693 | ||
Corporate | |||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | (1,799) | 1,712 | (3,289) | 5,100 | |
Noninterest income | 81,289 | ||||
Noninterest expense | 6,028 | 5,015 | 17,546 | 9,767 | |
Income before income taxes | (7,827) | (3,303) | 60,454 | (4,667) | |
Total assets | 1,865,885 | 1,865,885 | 1,522,655 | ||
All Other and Eliminations. | |||||
Information about the revenues, operating results, goodwill and assets | |||||
Net interest income (expense) | 4,651 | 4,883 | 13,693 | 13,865 | |
Noninterest income | (4,611) | (8,232) | (13,990) | (18,385) | |
Noninterest expense | (1,206) | (615) | (1,582) | (1,786) | |
Income before income taxes | 1,246 | $ (2,734) | 1,285 | $ (2,734) | |
Total assets | $ (3,283,759) | $ (3,283,759) | $ (2,903,143) |
Earnings per Common Share (Deta
Earnings per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Basic earnings per share: | ||||
Income (loss) applicable to Hilltop common stockholders | $ 46,678 | $ 23,265 | $ 187,531 | $ 73,847 |
Weighted average shares outstanding - basic | 98,676 | 89,711 | 99,297 | 89,709 |
Basic earnings (loss) per common share (in dollars per share) | $ 0.47 | $ 0.26 | $ 1.89 | $ 0.82 |
Diluted earnings per share: | ||||
Weighted average shares outstanding - diluted | 99,556 | 90,558 | 100,191 | 90,570 |
Effect of potentially dilutive securities (in shares) | 880 | 847 | 894 | 861 |
Diluted earnings (loss) per common share (in dollars per share) | $ 0.47 | $ 0.26 | $ 1.88 | $ 0.82 |
Restricted Stock Awards | ||||
Basic earnings per share: | ||||
Less: income applicable to participating shares | $ (216) | $ (121) | $ (861) | $ (384) |
Common Stock | Equity and Award Type Excluding Restricted Stock Awards | ||||
Basic earnings per share: | ||||
Income (loss) applicable to Hilltop common stockholders | 46,894 | 23,386 | 188,392 | 74,231 |
Diluted earnings per share: | ||||
Income (loss) applicable to Hilltop common stockholders | $ 46,894 | $ 23,386 | $ 188,392 | $ 74,231 |
Recent Issued Accounting Standa
Recent Issued Accounting Standards (Details) - Senior Exchangeable Notes 5.00 Percent Due 2025 - Private Placement - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2015 | Sep. 30, 2015 | Apr. 09, 2015 | |
Debt Instrument [Line Items] | ||||
Debt Issuance Cost | $ 1,900 | |||
Debt Instrument, Face Amount | $ 150,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | |||
Amortization of Financing Costs | $ 33 | $ 100 |