Loans and leases and the allowance for credit losses | 4. Loans and leases and the allowance for credit losses The outstanding principal balance and the carrying amount of acquired loans that were recorded at fair value at the acquisition date and included in the consolidated balance sheet follow: June 30, December 31, (in thousands) Outstanding principal balance $ 2,631,165 3,070,268 Carrying amount: Commercial, financial, leasing, etc. 191,721 247,820 Commercial real estate 775,816 961,828 Residential real estate 407,774 453,360 Consumer 844,068 933,537 $ 2,219,379 2,596,545 Purchased impaired loans included in the table above totaled $169 million at June 30, 2015 and $198 million at December 31, 2014, representing less than 1% of the Company’s assets as of each date. A summary of changes in the accretable yield for acquired loans for the three months and six months ended June 30, 2015 and 2014 follows: Three months ended June 30 2015 2014 Purchased Other Purchased Other (in thousands) Balance at beginning of period $ 71,422 357,895 $ 30,939 485,162 Interest income (5,772 ) (40,024 ) (5,106 ) (43,452 ) Reclassifications from nonaccretable balance, net 11,974 26,840 249 774 Other (a) — 278 — 8,486 Balance at end of period $ 77,624 344,989 $ 26,082 450,970 Six months ended June 30 2015 2014 Purchased Other Purchased Other (in thousands) Balance at beginning of period $ 76,518 397,379 $ 37,230 538,633 Interest income (10,978 ) (81,301 ) (11,434 ) (96,085 ) Reclassifications from nonaccretable balance, net 12,084 27,023 286 774 Other (a) — 1,888 — 7,648 Balance at end of period $ 77,624 344,989 $ 26,082 450,970 (a) Other changes in expected cash flows including changes in interest rates and prepayment assumptions. A summary of current, past due and nonaccrual loans as of June 30, 2015 and December 31, 2014 follows: Current 30-89 90 Days or Purchased Nonaccrual Total Non- Acquired (in thousands) June 30, 2015 Commercial, financial, leasing, etc. $ 19,852,368 36,637 4,777 1,628 5,273 210,345 $ 20,111,028 Real estate: Commercial 22,487,721 156,567 17,079 17,919 52,115 167,520 22,898,921 Residential builder and developer 1,666,183 4,233 — 6,603 73,628 56,854 1,807,501 Other commercial construction 3,642,229 43,683 6,112 2,834 20,059 21,149 3,736,066 Residential 7,525,761 197,893 207,195 18,972 15,804 164,721 8,130,346 Residential Alt-A 234,859 11,152 — — — 68,185 314,196 Consumer: Home equity lines and loans 5,765,082 31,446 — 12,371 2,361 78,250 5,889,510 Automobile 2,134,000 29,906 — — — 15,156 2,179,062 Other 2,996,396 31,591 3,405 18,264 — 14,966 3,064,622 Total $ 66,304,599 543,108 238,568 78,591 169,240 797,146 $ 68,131,252 4. Loans and leases and the allowance for credit losses, continued Current 30-89 90 Days or Purchased Nonaccrual Total Non- Acquired (in thousands) December 31, 2014 Commercial, financial, leasing, etc. $ 19,228,265 37,246 1,805 6,231 10,300 177,445 $ 19,461,292 Real estate: Commercial 22,208,491 118,704 22,170 14,662 51,312 141,600 22,556,939 Residential builder and developer 1,273,607 11,827 492 9,350 98,347 71,517 1,465,140 Other commercial construction 3,484,932 17,678 — — 17,181 25,699 3,545,490 Residential 7,640,368 226,932 216,489 35,726 18,223 180,275 8,318,013 Residential Alt-A 249,810 11,774 — — — 77,704 339,288 Consumer: Home equity lines and loans 5,859,378 42,945 — 27,896 2,374 89,291 6,021,884 Automobile 1,931,138 30,500 — 133 — 17,578 1,979,349 Other 2,909,791 33,295 4,064 16,369 — 18,042 2,981,561 Total $ 64,785,780 530,901 245,020 110,367 197,737 799,151 $ 66,668,956 (a) Acquired loans that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately. (b) Accruing loans that were impaired at acquisition date and were recorded at fair value. One-to-four family residential mortgage loans originated for sale were $479 million and $435 million at June 30, 2015 and December 31, 2014, respectively. Commercial mortgage loans held for sale were $320 million at June 30, 2015 and $308 million at December 31, 2014. Changes in the allowance for credit losses for the three months ended June 30, 2015 were as follows: Commercial, Real Estate Commercial Residential Consumer Unallocated Total (in thousands) Beginning balance $ 281,069 317,375 60,741 186,052 76,136 $ 921,373 Provision for credit losses 9,737 (3,652 ) 1,624 21,016 1,275 30,000 Net charge-offs Charge-offs (7,728 ) (3,470 ) (3,309 ) (18,455 ) — (32,962 ) Recoveries 3,672 1,041 1,238 5,625 — 11,576 Net charge-offs (4,056 ) (2,429 ) (2,071 ) (12,830 ) — (21,386 ) Ending balance $ 286,750 311,294 60,294 194,238 77,411 $ 929,987 Changes in the allowance for credit losses for the three months ended June 30, 2014 were as follows: Commercial, Real Estate Commercial Residential Consumer Unallocated Total (in thousands) Beginning balance $ 276,835 324,805 77,062 162,134 75,932 $ 916,768 Provision for credit losses 25,556 (12,229 ) (1,957 ) 18,676 (46 ) 30,000 Net charge-offs Charge-offs (14,142 ) (2,814 ) (5,478 ) (19,404 ) — (41,838 ) Recoveries 4,002 1,492 2,777 4,465 — 12,736 Net charge-offs (10,140 ) (1,322 ) (2,701 ) (14,939 ) — (29,102 ) Ending balance $ 292,251 311,254 72,404 165,871 75,886 $ 917,666 Changes in the allowance for credit losses for the six months ended June 30, 2015 were as follows: Commercial, Real Estate Commercial Residential Consumer Unallocated Total (in thousands) Beginning balance $ 288,038 307,927 61,910 186,033 75,654 $ 919,562 Provision for credit losses 11,179 11,890 2,584 40,590 1,757 68,000 Net charge-offs Charge-offs (20,078 ) (10,149 ) (6,427 ) (43,784 ) — (80,438 ) Recoveries 7,611 1,626 2,227 11,399 — 22,863 Net charge-offs (12,467 ) (8,523 ) (4,200 ) (32,385 ) — (57,575 ) Ending balance $ 286,750 311,294 60,294 194,238 77,411 $ 929,987 Changes in the allowance for credit losses for the six months ended June 30, 2014 were as follows: Commercial, Real Estate Commercial Residential Consumer Unallocated Total (in thousands) Beginning balance $ 273,383 324,978 78,656 164,644 75,015 $ 916,676 Provision for credit losses 38,154 (12,113 ) 2,271 32,817 871 62,000 Net charge-offs Charge-offs (28,951 ) (6,300 ) (12,931 ) (41,095 ) — (89,277 ) Recoveries 9,665 4,689 4,408 9,505 — 28,267 Net charge-offs (19,286 ) (1,611 ) (8,523 ) (31,590 ) — (61,010 ) Ending balance $ 292,251 311,254 72,404 165,871 75,886 $ 917,666 Despite the above allocation, the allowance for credit losses is general in nature and is available to absorb losses from any loan or lease type. In establishing the allowance for credit losses, the Company estimates losses attributable to specific troubled credits identified through both normal and detailed or intensified credit review processes and also estimates losses inherent in other loans and leases on a collective basis. For purposes of determining the level of the allowance for credit losses, the Company evaluates its loan and lease portfolio by loan type. The amounts of loss components in the Company’s loan and lease portfolios are determined through a loan by loan analysis of larger balance commercial loans and commercial real estate loans that are in nonaccrual status and by applying loss factors to groups of loan balances based on loan type and management’s classification of such loans under the Company’s loan grading system. Measurement of the specific loss components is typically based on expected future cash flows, collateral values and other factors that may impact the borrower’s ability to pay. In determining the allowance for credit losses, the Company utilizes a loan grading system which is applied to commercial and commercial real estate credits on an individual loan basis. Loan officers are responsible for assigning grades to these loans based on standards outlined in the Company’s Credit Policy. Internal loan grades are also monitored by the Company’s loan review department to ensure consistency and strict adherence to the prescribed standards. Loan grades are assigned loss component factors that reflect the Company’s loss estimate for each group of loans and leases. Factors considered in assigning loan grades and loss component factors include borrower-specific information related to expected future cash flows and operating results, collateral values, geographic location, financial condition and performance, payment status, and other information; levels of and trends in portfolio charge-offs and recoveries; levels of and trends in portfolio delinquencies and impaired loans; changes in the risk profile of specific portfolios; trends in volume and terms of loans; effects of changes in credit concentrations; and observed trends and practices in the banking industry. As updated appraisals are obtained on individual loans or other events in the market place indicate that collateral values have significantly changed, individual loan grades are adjusted as appropriate. Changes in other factors cited may also lead to loan grade changes at any time. Except for consumer and residential real estate loans that are considered smaller balance homogenous loans and acquired loans that are evaluated on an aggregated basis, the Company considers a loan to be impaired for purposes of applying GAAP when, based on current information and events, it is probable that the Company will be unable to collect all amounts according to the contractual terms of the loan agreement or the loan is delinquent 90 days. Regardless of loan type, the Company considers a loan to be impaired if it qualifies as a troubled debt restructuring. Modified loans, including smaller balance homogenous loans, that are considered to be troubled debt restructurings are evaluated for impairment giving consideration to the impact of the modified loan terms on the present value of the loan’s expected cash flows. The following tables provide information with respect to loans and leases that were considered impaired as of June 30, 2015 and December 31, 2014 and for the three-month and six-month periods ended June 30, 2015 and June 30, 2014: June 30, 2015 December 31, 2014 Recorded Unpaid Related Recorded Unpaid Related (in thousands) With an allowance recorded: Commercial, financial, leasing, etc. $ 122,574 147,028 31,098 132,340 165,146 31,779 Real estate: Commercial 105,064 120,905 18,390 83,955 96,209 14,121 Residential builder and developer 7,808 10,439 661 17,632 22,044 805 Other commercial construction 3,091 4,542 514 5,480 6,484 900 Residential 84,241 102,237 4,931 88,970 107,343 4,296 Residential Alt-A 94,752 107,894 10,000 101,137 114,565 11,000 Consumer: Home equity lines and loans 21,235 22,219 3,531 19,771 20,806 6,213 Automobile 25,175 25,175 6,334 30,317 30,317 8,070 Other 19,256 19,256 5,458 18,973 18,973 5,459 483,196 559,695 80,917 498,575 581,887 82,643 With no related allowance recorded: Commercial, financial, leasing, etc. 116,982 138,635 — 73,978 81,493 — Real estate: Commercial 72,094 79,541 — 66,777 78,943 — Residential builder and developer 53,843 94,700 — 58,820 96,722 — Other commercial construction 18,524 39,347 — 20,738 41,035 — Residential 16,174 26,120 — 16,815 26,750 — Residential Alt-A 23,535 40,517 — 26,752 46,964 — 301,152 418,860 — 263,880 371,907 — Total: Commercial, financial, leasing, etc. 239,556 285,663 31,098 206,318 246,639 31,779 Real estate: Commercial 177,158 200,446 18,390 150,732 175,152 14,121 Residential builder and developer 61,651 105,139 661 76,452 118,766 805 Other commercial construction 21,615 43,889 514 26,218 47,519 900 Residential 100,415 128,357 4,931 105,785 134,093 4,296 Residential Alt-A 118,287 148,411 10,000 127,889 161,529 11,000 Consumer: Home equity lines and loans 21,235 22,219 3,531 19,771 20,806 6,213 Automobile 25,175 25,175 6,334 30,317 30,317 8,070 Other 19,256 19,256 5,458 18,973 18,973 5,459 Total $ 784,348 978,555 80,917 762,455 953,794 82,643 Three months ended Three months ended Interest income Interest income Average Total Cash Average Total Cash (in thousands) Commercial, financial, leasing, etc. $ 221,952 502 502 150,625 220 220 Real estate: Commercial 153,105 1,004 1,004 207,633 869 869 Residential builder and developer 66,334 131 131 91,614 39 39 Other commercial construction 23,614 168 168 77,801 356 356 Residential 101,560 1,358 785 119,133 5,056 4,468 Residential Alt-A 120,286 1,650 697 134,895 1,733 660 Consumer: Home equity lines and loans 20,221 224 65 18,762 200 72 Automobile 26,123 416 43 36,631 589 74 Other 19,058 185 30 18,309 166 49 Total $ 752,253 5,638 3,425 855,403 9,228 6,807 Six months ended Six months ended Interest income Interest income Average Total Cash Average Total Cash (in thousands) Commercial, financial, leasing, etc. $ 218,285 1,106 1,106 142,466 768 768 Real estate: Commercial 153,088 2,106 2,106 196,529 1,795 1,795 Residential builder and developer 69,742 194 194 96,434 113 113 Other commercial construction 24,577 223 223 82,546 1,443 1,443 Residential 103,025 2,804 1,695 146,651 6,456 5,370 Residential Alt-A 122,970 3,260 1,344 137,273 3,359 1,219 Consumer: Home equity lines and loans 19,952 425 113 17,219 321 101 Automobile 27,568 866 97 38,007 1,214 161 Other 18,960 359 63 18,005 340 101 Total $ 758,167 11,343 6,941 875,130 15,809 11,071 In accordance with the previously described policies, the Company utilizes a loan grading system that is applied to all commercial loans and commercial real estate loans. Loan grades are utilized to differentiate risk within the portfolio and consider the expectations of default for each loan. Commercial loans and commercial real estate loans with a lower expectation of default are assigned one of ten possible “pass” loan grades and are generally ascribed lower loss factors when determining the allowance for credit losses. Loans with an elevated level of credit risk are classified as “criticized” and are ascribed a higher loss factor when determining the allowance for credit losses. Criticized loans may be classified as “nonaccrual” if the Company no longer expects to collect all amounts according to the contractual terms of the loan agreement or the loan is delinquent 90 days or more. All larger balance criticized commercial and commercial real estate loans are individually reviewed by centralized loan review personnel each quarter to determine the appropriateness of the assigned loan grade, including whether the loan should be reported as accruing or nonaccruing. Smaller balance criticized loans are analyzed by business line risk management areas to ensure proper loan grade classification. Furthermore, criticized nonaccrual commercial loans and commercial real estate loans are considered impaired and, as a result, specific loss allowances on such loans are established within the allowance for credit losses to the extent appropriate in each individual instance. The following table summarizes the loan grades applied to the various classes of the Company’s commercial and commercial real estate loans. Real Estate Commercial, Commercial Residential Other (in thousands) June 30, 2015 Pass $ 19,079,109 21,885,377 1,690,496 3,549,397 Criticized accrual 821,574 846,024 60,151 165,520 Criticized nonaccrual 210,345 167,520 56,854 21,149 Total $ 20,111,028 22,898,921 1,807,501 3,736,066 December 31, 2014 Pass $ 18,695,440 21,837,022 1,347,778 3,347,522 Criticized accrual 588,407 578,317 45,845 172,269 Criticized nonaccrual 177,445 141,600 71,517 25,699 Total $ 19,461,292 22,556,939 1,465,140 3,545,490 In determining the allowance for credit losses, residential real estate loans and consumer loans are generally evaluated collectively after considering such factors as payment performance and recent loss experience and trends, which are mainly driven by current collateral values in the market place as well as the amount of loan defaults. Loss rates on such loans are determined by reference to recent charge-off history and are evaluated (and adjusted if deemed appropriate) through consideration of other factors including near-term forecasted loss estimates developed by the Company’s Credit Department. In arriving at such forecasts, the Company considers the current estimated fair value of its collateral based on geographical adjustments for home price depreciation/appreciation and overall borrower repayment performance. With regard to collateral values, the realizability of such values by the Company contemplates repayment of any first lien position prior to recovering amounts on a second lien position. Residential real estate loans and outstanding balances of home equity loans and lines of credit that are more than 150 days past due are generally evaluated for collectibility on a loan-by-loan basis giving consideration to estimated collateral values. The carrying value of residential real estate loans and home equity loans and lines of credit for which a partial charge-off has been recognized aggregated $59 million and $20 million, respectively, at June 30, 2015 and $63 million and $18 million, respectively, at December 31, 2014. Residential real estate loans and home equity loans and lines of credit that were more than 150 days past due but did not require a partial charge-off because the net realizable value of the collateral exceeded the outstanding customer balance totaled $23 million and $28 million, respectively, at June 30, 2015 and $27 million and $28 million, respectively, at December 31, 2014. The Company also measures additional losses for purchased impaired loans when it is probable that the Company will be unable to collect all cash flows expected at acquisition plus additional cash flows expected to be collected arising from changes in estimates after acquisition. The determination of the allocated portion of the allowance for credit losses is very subjective. Given that inherent subjectivity and potential imprecision involved in determining the allocated portion of the allowance for credit losses, the Company also provides an inherent unallocated portion of the allowance. The unallocated portion of the allowance is intended to recognize probable losses that are not otherwise identifiable and includes management’s subjective determination of amounts necessary to provide for the possible use of imprecise estimates in determining the allocated portion of the allowance. Therefore, the level of the unallocated portion of the allowance is primarily reflective of the inherent imprecision in the various calculations used in determining the allocated portion of the allowance for credit losses. Other factors that could also lead to changes in the unallocated portion include the effects of expansion into new markets for which the Company does not have the same degree of familiarity and experience regarding portfolio performance in changing market conditions, the introduction of new loan and lease product types, and other risks associated with the Company’s loan portfolio that may not be specifically identifiable. The allocation of the allowance for credit losses summarized on the basis of the Company’s impairment methodology was as follows: Commercial, Real Estate Commercial Residential Consumer Total (in thousands) June 30, 2015 Individually evaluated for impairment $ 31,098 19,296 14,904 15,323 $ 80,621 Collectively evaluated for impairment 253,312 290,853 43,428 177,444 765,037 Purchased impaired 2,340 1,145 1,962 1,471 6,918 Allocated $ 286,750 311,294 60,294 194,238 852,576 Unallocated 77,411 Total $ 929,987 December 31, 2014 Individually evaluated for impairment $ 31,779 15,490 14,703 19,742 $ 81,714 Collectively evaluated for impairment 251,607 291,244 45,061 165,140 753,052 Purchased impaired 4,652 1,193 2,146 1,151 9,142 Allocated $ 288,038 307,927 61,910 186,033 843,908 Unallocated 75,654 Total $ 919,562 The recorded investment in loans and leases summarized on the basis of the Company’s impairment methodology was as follows: Commercial, Real Estate Commercial Residential Consumer Total (in thousands) June 30, 2015 Individually evaluated for impairment $ 239,556 259,441 218,410 65,666 $ 783,073 Collectively evaluated for impairment 19,866,199 28,037,245 8,210,328 11,065,167 67,178,939 Purchased impaired 5,273 145,802 15,804 2,361 169,240 Total $ 20,111,028 28,442,488 8,444,542 11,133,194 $ 68,131,252 December 31, 2014 Individually evaluated for impairment $ 206,318 252,347 232,398 69,061 $ 760,124 Collectively evaluated for impairment 19,244,674 27,148,382 8,406,680 10,911,359 65,711,095 Purchased impaired 10,300 166,840 18,223 2,374 197,737 Total $ 19,461,292 27,567,569 8,657,301 10,982,794 $ 66,668,956 During the normal course of business, the Company modifies loans to maximize recovery efforts. If the borrower is experiencing financial difficulty and a concession is granted, the Company considers such modifications as troubled debt restructurings and classifies those loans as either nonaccrual loans or renegotiated loans. The types of concessions that the Company grants typically include principal deferrals and interest rate concessions, but may also include other types of concessions. The tables below summarize the Company’s loan modification activities that were considered troubled debt restructurings for the three months ended June 30, 2015 and 2014: Recorded investment Financial effects of Three months ended June 30, 2015 Number Pre- Post- Recorded Interest (dollars in thousands) Commercial, financial, leasing, etc. Principal deferral 30 $ 16,018 $ 15,355 $ (663 ) $ — Other 2 8,991 8,883 (108 ) — Combination of concession types 2 15,889 17,864 1,975 (239 ) Real estate: Commercial Principal deferral 15 38,983 37,585 (1,398 ) — Combination of concession types 1 436 436 — (53 ) Residential builder and developer Principal deferral 1 9,252 9,200 (52 ) — Residential Principal deferral 12 693 754 61 — Combination of concession types 9 961 1,066 105 (144 ) Residential Alt-A Principal deferral 1 161 161 — — Combination of concession types 2 424 426 2 (26 ) Consumer: Home equity lines and loans Principal deferral 1 1,198 1,198 — — Combination of concession types 14 1,356 1,356 — (212 ) Automobile Principal deferral 63 615 615 — — Interest rate reduction 4 95 95 — (7 ) Other 13 21 21 — — Combination of concession types 9 138 138 — (4 ) Other Principal deferral 27 770 770 — — Other 2 21 21 — — Combination of concession types 10 43 43 — (7 ) Total 218 $ 96,065 $ 95,987 $ (78 ) $ (692 ) (a) Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages. (b) Represents the present value of interest rate concessions discounted at the effective rate of the original loan. Recorded investment Financial effects of Three months ended June 30, 2014 Number Pre- Post- Recorded Interest (dollars in thousands) Commercial, financial, leasing, etc. Principal deferral 21 $ 4,414 $ 4,351 $ (63 ) $ — Other 1 19,593 19,593 — — Combination of concession types 3 9,795 9,727 (68 ) (10 ) Real estate: Commercial Principal deferral 11 8,327 8,314 (13 ) — Interest rate reduction 1 255 252 (3 ) (48 ) Combination of concession types 1 63 61 (2 ) (9 ) Residential builder and developer Principal deferral 1 1,398 1,398 — — Other commercial construction Principal deferral 2 6,407 6,318 (89 ) — Residential Principal deferral 3 142 166 24 — Combination of concession types 8 923 991 68 (66 ) Residential Alt-A Principal deferral 3 662 698 36 — Combination of concession types 6 1,006 1,029 23 (220 ) Consumer: Home equity lines and loans Interest rate reduction 5 341 341 — (76 ) Combination of concession types 21 1,772 1,772 — (204 ) Automobile Principal deferral 43 603 603 — — Interest rate reduction 3 60 60 — (3 ) Other 8 47 47 — — Combination of concession types 23 341 341 — (36 ) Other Principal deferral 7 38 38 — — Interest rate reduction 3 291 291 — (63 ) Combination of concession types 19 906 906 — (276 ) Total 193 $ 57,384 $ 57,297 $ (87 ) $ (1,011 ) (a) Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages. (b) Represents the present value of interest rate concessions discounted at the effective rate of the original loan. The tables below summarize the Company’s loan modification activities that were considered troubled debt restructurings for the six months ended June 30, 2015 and 2014: Recorded investment Financial effects of Six months ended June 30, 2015 Number Pre- Post- Recorded Interest (dollars in thousands) Commercial, financial, leasing, etc. Principal deferral 51 $ 17,590 $ 16,912 $ (678 ) $ — Interest rate reduction 1 99 99 — (19 ) Other 2 8,991 8,883 (108 ) — Combination of concession types 5 25,044 24,853 (191 ) (239 ) Real estate: Commercial Principal deferral 22 42,775 41,361 (1,414 ) — Combination of concession types 5 2,082 2,073 (9 ) (105 ) Residential builder and developer Principal deferral 2 10,650 10,598 (52 ) — Residential Principal deferral 19 1,414 1,496 82 — Combination of concession types 12 1,255 1,415 160 (178 ) Residential Alt-A Principal deferral 1 161 161 — — Combination of concession types 3 634 636 2 (30 ) Consumer: Home equity lines and loans Principal deferral 2 1,219 1,219 — — Combination of concession types 19 1,552 1,552 — (225 ) Automobile Principal deferral 98 918 918 — — Interest rate reduction 7 137 137 — (10 ) Other 23 41 41 — — Combination of concession types 17 222 222 — (11 ) Other Principal deferral 49 1,066 1,066 — — Other 7 80 80 — — Combination of concession types 23 267 267 — (32 ) Total 368 $ 116,197 $ 113,989 $ (2,208 ) $ (849 ) (a) Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages. (b) Represents the present value of interest rate concessions discounted at the effective rate of the original loan. Recorded investment Financial effects of Six months ended June 30, 2014 Number Pre- Post- Recorded Interest (dollars in thousands) Commercial, financial, leasing, etc. Principal deferral 51 $ 19,368 $ 19,199 $ (169 ) $ — Other 1 19,593 19,593 — — Combination of concession types 5 9,836 9,766 (70 ) (14 ) Real estate: Commercial Principal deferral 24 15,371 15,316 (55 ) — Interest rate reduction 1 255 252 (3 ) (48 ) Combination of concession types 2 409 462 53 (113 ) Residential builder and developer Principal deferral 1 1,398 1,398 — — Other commercial construction Principal deferral 3 6,558 6,469 (89 ) — Residential Principal deferral 16 1,744 1,829 85 — Interest rate reduction 1 98 104 6 (32 ) Other 1 188 188 — — Combination of concession types 22 3,111 3,151 40 (348 ) Residential Alt-A Principal deferral 5 828 900 72 — Combination of concession types 16 2,752 2,765 13 (281 ) Consumer: Home equity lines and loans Principal deferral 3 280 280 — — Interest rate reduction 5 341 341 — (76 ) Combination of concession types 36 3,628 3,628 — (376 ) Automobile Principal deferral 123 1,596 1,596 — — Interest rate reduction 3 60 60 — (3 ) Other 19 108 108 — — Combination of concession types 46 591 591 — (62 ) Other Principal deferral 15 93 93 — — Interest rate reduction 3 291 291 — (63 ) Other 1 45 45 — — Combination of concession types 33 1,372 1,372 — (464 ) Total 436 $ 89,914 $ 89,797 $ (117 ) $ (1,880 ) (a) Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages. (b) Represents the present value of interest rate concessions discounted at the effective rate of the original loan. Troubled debt restructurings are considered to be impaired loans and for purposes of establishing the allowance for credit losses are evaluated for impairment giving consideration to the impact of the modified loan terms on the present value of the loan’s expected cash flows. Impairment of troubled debt restructurings that have subsequently defaulted may also be measured based on the loan’s observable market price or the fair value of collateral if the loan is collateral-dependent. Charge-offs may also be recognized on troubled debt restructurings that have subsequently defaulted. Loans that were modified as troubled debt restructurings during the twelve months ended June 30, 2015 and 2014 and for which there was a subsequent payment default during the six-month periods ended June 30, 2015 and 2014, respectively, were not material. Effective January 1, 2015, the Company adopted amended accounting and disclosure guidance for reclassification of residential real estate collateralized consumer mortgage loans upon foreclosure. The amended guidance clarifies that an in-substance repossession or foreclosure occurs and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. The adoption resulted in an insignificant increase in other real estate owned. The amount of foreclosed residential real estate property held by the Company was $43 million and $44 million at June 30, 2015 and December 31, 2014, respectively. At June 30, 2015, there were $158 million in loans secured by residential real estate that were in the process of foreclosure. |