Loans and Leases | Loans and Leases The following table summarizes loans and leases: (In thousands) At September 30, At December 31, 2015 Residential $ 4,234,047 $ 4,061,001 Consumer 2,707,343 2,702,560 Commercial 4,779,802 4,315,999 Commercial Real Estate 4,280,513 3,991,649 Equipment Financing 621,696 600,526 Loans and leases (1) (2) $ 16,623,401 $ 15,671,735 (1) Loans and leases include net deferred fees and net premiums/discounts of $19.7 million and $18.0 million at September 30, 2016 and December 31, 2015 , respectively. (2) At September 30, 2016 , the Company had pledged $6.4 billion of eligible residential and consumer loans as collateral to support borrowing capacity at the FHLB Boston and the FRB of Boston. Loans and Leases Portfolio Aging The following tables summarize the aging of loans and leases: At September 30, 2016 (In thousands) 30-59 Days Past Due and Accruing 60-89 Days 90 or More Days Past Due and Accruing Non-accrual Total Past Due and Non-accrual Current Total Loans Residential $ 7,547 $ 3,547 $ — $ 49,197 $ 60,291 $ 4,173,756 $ 4,234,047 Consumer: Home equity 7,627 4,746 — 35,597 47,970 2,371,700 2,419,670 Other consumer 1,757 1,354 — 1,571 4,682 282,991 287,673 Commercial: Commercial non-mortgage 1,949 576 23 27,397 29,945 3,946,986 3,976,931 Asset-based — — — — — 802,871 802,871 Commercial real estate: Commercial real estate 1,082 148 5,444 10,957 17,631 3,933,588 3,951,219 Commercial construction — — — 3,438 3,438 325,856 329,294 Equipment financing 3,164 313 — 202 3,679 618,017 621,696 Total $ 23,126 $ 10,684 $ 5,467 $ 128,359 $ 167,636 $ 16,455,765 $ 16,623,401 At December 31, 2015 (In thousands) 30-59 Days 60-89 Days Past Due and Accruing 90 or More Days Past Due Non-accrual Total Past Due and Non-accrual Current Total Loans Residential $ 10,365 $ 4,703 $ 2,029 $ 54,201 $ 71,298 $ 3,989,703 $ 4,061,001 Consumer: Home equity 9,061 4,242 — 37,337 50,640 2,402,758 2,453,398 Other consumer 1,390 615 — 560 2,565 246,597 249,162 Commercial: Commercial non-mortgage 768 3,288 22 27,037 31,115 3,531,669 3,562,784 Asset-based — — — — — 753,215 753,215 Commercial real estate: Commercial real estate 1,624 625 — 16,767 19,016 3,673,408 3,692,424 Commercial construction — — — 3,461 3,461 295,764 299,225 Equipment financing 543 59 — 706 1,308 599,218 600,526 Total $ 23,751 $ 13,532 $ 2,051 $ 140,069 $ 179,403 $ 15,492,332 $ 15,671,735 Interest on non-accrual loans and leases that would have been recorded as additional interest income for the three and nine months ended September 30, 2016 and 2015 , had the loans and leases been current in accordance with their original terms, totaled $3.7 million , $8.4 million , $2.6 million and $6.3 million , respectively. Allowance for Loan and Lease Losses The following tables summarize the ALLL: At or for the three months ended September 30, 2016 Residential Consumer Commercial Commercial Real Estate Equipment Financing Total ALLL: Balance, beginning of period $ 24,413 $ 42,956 $ 73,822 $ 33,622 $ 5,615 $ 180,428 Provision (benefit) charged to expense 1,076 4,985 4,351 2,953 885 14,250 Charge-offs (1,304 ) (5,259 ) (2,561 ) — (300 ) (9,424 ) Recoveries 554 1,313 370 194 240 2,671 Balance, end of period $ 24,739 $ 43,995 $ 75,982 $ 36,769 $ 6,440 $ 187,925 At or for the three months ended September 30, 2015 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total ALLL: Balance, beginning of period $ 24,463 $ 40,807 $ 66,241 $ 30,768 $ 5,581 $ 167,860 Provision (benefit) charged to expense 1,150 6,864 3,089 1,961 (64 ) 13,000 Charge-offs (1,588 ) (4,831 ) (2,204 ) (1,346 ) — (9,969 ) Recoveries 281 1,004 715 69 32 2,101 Balance, end of period $ 24,306 $ 43,844 $ 67,841 $ 31,452 $ 5,549 $ 172,992 At or for the nine months ended September 30, 2016 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total ALLL: Balance, beginning of period $ 25,876 $ 42,052 $ 66,686 $ 34,889 $ 5,487 $ 174,990 Provision (benefit) charged to expense 991 12,458 25,447 3,921 1,033 43,850 Charge-offs (3,536 ) (14,236 ) (17,294 ) (2,521 ) (521 ) (38,108 ) Recoveries 1,408 3,721 1,143 480 441 7,193 Balance, end of period $ 24,739 $ 43,995 $ 75,982 $ 36,769 $ 6,440 $ 187,925 Individually evaluated for impairment $ 9,443 $ 3,005 $ 6,579 $ 467 $ 9 $ 19,503 Collectively evaluated for impairment $ 15,296 $ 40,990 $ 69,403 $ 36,302 $ 6,431 $ 168,422 Loan and lease balances: Individually evaluated for impairment $ 122,020 $ 46,208 $ 58,197 $ 24,423 $ 6,863 $ 257,711 Collectively evaluated for impairment 4,112,027 2,661,135 4,721,605 4,256,090 614,833 16,365,690 Loans and leases $ 4,234,047 $ 2,707,343 $ 4,779,802 $ 4,280,513 $ 621,696 $ 16,623,401 At or for the nine months ended September 30, 2015 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total ALLL: Balance, beginning of period $ 25,452 $ 43,518 $ 52,114 $ 32,102 $ 6,078 $ 159,264 Provision (benefit) charged to expense 3,100 10,091 18,468 4,617 (776 ) 35,500 Charge-offs (5,004 ) (12,980 ) (5,000 ) (5,590 ) (30 ) (28,604 ) Recoveries 758 3,215 2,259 323 277 6,832 Balance, end of period $ 24,306 $ 43,844 $ 67,841 $ 31,452 $ 5,549 $ 172,992 Individually evaluated for impairment $ 10,773 $ 3,540 $ 11,478 $ 4,527 $ 5 $ 30,323 Collectively evaluated for impairment $ 13,533 $ 40,304 $ 56,363 $ 26,925 $ 5,544 $ 142,669 Loan and lease balances: Individually evaluated for impairment $ 138,227 $ 46,455 $ 54,522 $ 41,598 $ 102 $ 280,904 Collectively evaluated for impairment 3,877,612 2,604,247 4,085,457 3,815,557 552,748 14,935,621 Loans and leases $ 4,015,839 $ 2,650,702 $ 4,139,979 $ 3,857,155 $ 552,850 $ 15,216,525 Impaired Loans and Leases The following tables summarize impaired loans and leases: At September 30, 2016 (In thousands) Unpaid Principal Balance Total Recorded Investment No Allowance Recorded Investment With Allowance Related Valuation Allowance Residential $ 134,026 $ 122,020 $ 21,404 $ 100,616 $ 9,443 Consumer 52,516 46,208 23,612 22,596 3,005 Commercial 64,537 58,197 25,720 32,477 6,579 Commercial real estate: Commercial real estate 20,823 20,044 9,156 10,888 467 Commercial construction 4,911 4,379 4,379 — — Equipment financing 6,901 6,863 6,638 225 9 Total $ 283,714 $ 257,711 $ 90,909 $ 166,802 $ 19,503 At December 31, 2015 (In thousands) Unpaid Principal Balance Total Recorded Investment No Allowance Recorded Investment With Allowance Related Valuation Allowance Residential $ 148,144 $ 134,448 $ 23,024 $ 111,424 $ 10,364 Consumer 56,680 48,425 25,130 23,295 3,477 Commercial 67,116 56,581 31,600 24,981 5,197 Commercial real estate: Commercial real estate 36,980 33,333 9,204 24,129 3,160 Commercial construction 7,010 5,962 5,939 23 3 Equipment financing 612 422 328 94 3 Total $ 316,542 $ 279,171 $ 95,225 $ 183,946 $ 22,204 The following table summarizes the average recorded investment and interest income recognized for impaired loans and leases: Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 (In thousands) Average Recorded Investment Accrued Interest Income Cash Basis Interest Income Average Accrued Cash Basis Interest Income Average Recorded Investment Accrued Cash Basis Interest Income Average Recorded Investment Accrued Cash Basis Interest Income Residential $ 124,993 $ 1,070 $ 304 $ 138,519 $ 1,114 $ 290 $ 128,234 $ 3,309 $ 918 $ 140,105 $ 3,322 $ 847 Consumer 46,892 336 238 47,787 371 271 47,317 1,029 754 48,352 1,094 827 Commercial 58,874 352 — 54,667 262 — 57,389 1,299 — 45,349 936 — Commercial real estate: Commercial real estate 23,930 77 — 44,222 137 — 26,689 374 — 65,640 1,024 — Commercial construction 4,386 12 — 6,059 33 — 5,171 81 — 6,068 99 — Equipment financing 3,642 107 — 111 2 — 3,642 109 — 367 15 — Total $ 262,717 $ 1,954 $ 542 $ 291,365 $ 1,919 $ 561 $ 268,442 $ 6,201 $ 1,672 $ 305,881 $ 6,490 $ 1,674 Credit Quality Indicators. To measure credit risk for the commercial, commercial real estate, and equipment financing portfolios, the Company employs a dual grade credit risk grading system for estimating the probability of borrower default and the loss given default. The credit risk grade system assigns a rating to each borrower and to the facility, which together form a CCRP. The credit risk grade system categorizes borrowers by common financial characteristics that measure the credit strength of borrowers and facilities by common structural characteristics. The CCRP has 10 grades, with each grade corresponding to a progressively greater risk of default. Grades 1 through 6 are considered pass ratings, and 7 through 10 are considered criticized, as defined by the regulatory agencies. Risk ratings, assigned to differentiate risk within the portfolio, are reviewed on an ongoing basis and revised to reflect changes in the borrowers’ current financial positions and outlooks, risk profiles, and the related collateral and structural positions. Loan officers review updated financial information on at least an annual basis for all pass rated loans to assess the accuracy of the risk grade. Criticized loans undergo more frequent reviews and enhanced monitoring. A "Special Mention" (7) credit has the potential weakness that, if left uncorrected, may result in deterioration of the repayment prospects for the asset. "Substandard" (8) assets have a well defined weakness that jeopardizes the full repayment of the debt. An asset rated "Doubtful" (9) has all of the same weaknesses as a substandard credit with the added characteristic that the weakness makes collection or liquidation in full, given current facts, conditions, and values, improbable. Assets classified as "Loss" (10) in accordance with regulatory guidelines are considered uncollectible and charged off. The following table summarizes commercial, commercial real estate and equipment financing loans and leases segregated by risk rating exposure: Commercial Commercial Real Estate Equipment Financing (In thousands) At September 30, At December 31, At September 30, At December 31, At September 30, At December 31, (1) - (6) Pass $ 4,474,603 $ 4,023,255 $ 4,152,199 $ 3,857,019 $ 598,526 $ 586,445 (7) Special Mention 93,767 70,904 36,588 55,030 25 1,628 (8) Substandard 207,059 220,389 91,726 79,289 23,145 12,453 (9) Doubtful 4,373 1,451 — 311 — — Total $ 4,779,802 $ 4,315,999 $ 4,280,513 $ 3,991,649 $ 621,696 $ 600,526 For residential and consumer loans, the Company considers factors such as past due status, updated FICO scores, employment status, collateral, geography, loans discharged in bankruptcy, and the status of first lien position loans on second lien position loans as credit quality indicators. On an ongoing basis for portfolio monitoring purposes, the Company estimates the current value of property secured as collateral for both home equity and residential first mortgage lending products. The estimate is based on home price indices compiled by the S&P/Case-Shiller Home Price Indices. The trend data is applied to the loan portfolios taking into account the age of the most recent valuation and geographic area. Troubled Debt Restructurings The following table summarizes information for TDRs: (Dollars in thousands) At September 30, 2016 At December 31, 2015 Accrual status $ 161,853 $ 171,784 Non-accrual status 74,147 100,906 Total recorded investment of TDRs (1) $ 236,000 $ 272,690 Accruing TDRs performing under modified terms more than one year 54.1 % 55.0 % Specific reserves for TDRs included in the balance of ALLL $ 16,302 $ 21,405 Additional funds committed to borrowers in TDR status 1,316 1,133 (1) Total recorded investment of TDRs excludes $0.8 million and $1.1 million of accrued interest receivable at September 30, 2016 and December 31, 2015 , respectively. In the three and nine months ended September 30, 2016 and 2015 , Webster charged off $3.0 million , $17.9 million , $1.7 million and $7.6 million , respectively, for the portion of TDRs deemed to be uncollectible. A TDR may be modified by means of extended maturity, below market adjusted interest rates, a combination of rate and maturity, or other means, including covenant modifications, forbearance, loans discharged under Chapter 7 bankruptcy, or other concessions. The following table provides information on the type of concession for loans and leases modified as TDRs: Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 Number of Post- (1) Number of Post- (1) Number of Post- (1) Number of Post- (1) (Dollars in thousands) Residential: Extended Maturity 4 $ 967 4 $ 998 11 $ 1,969 19 $ 3,301 Adjusted Interest Rate 1 292 1 160 2 528 2 464 Maturity/Rate Combined 3 290 4 1,006 10 1,185 18 3,138 Other (2) 3 299 9 1,594 18 3,190 23 3,387 Consumer: Extended Maturity 2 89 4 296 9 381 9 935 Adjusted Interest Rate — — — — — — — — Maturity/Rate Combined 3 264 — — 11 923 8 444 Other (2) 8 270 20 1,357 37 1,447 50 3,087 Commercial: Extended Maturity 2 213 — — 11 14,862 3 256 Adjusted Interest Rate — — — — — 1 24 Maturity/Rate Combined — — 1 74 2 648 5 371 Other (2) 4 1,265 5 1,772 11 1,639 9 8,062 Commercial real estate: Extended Maturity 1 109 1 315 1 109 1 315 Maturity/Rate Combined 1 291 — — 2 335 1 43 Other (2) — — 1 405 1 509 1 405 Equipment Financing Extended Maturity 6 6,638 — — 7 6,642 — — Total TDRs 38 $ 10,987 50 $ 7,977 133 $ 34,367 150 $ 24,232 (1) Post-modification balances approximate pre-modification balances. The aggregate amount of charge-offs as a result of the restructurings was not significant. (2) Other includes covenant modifications, forbearance, loans discharged under Chapter 7 bankruptcy, or other concessions. The following table provides information on loans and leases modified as TDRs within the previous 12 months and for which there was a payment default during the periods presented: Three months ended September 30, Nine months ended September 30, 2016 2015 2016 2015 (Dollars in thousands) Number of Loans and Leases Recorded Investment Number of Loans and Leases Recorded Investment Number of Loans and Leases Recorded Investment Number of Loans and Leases Recorded Investment Residential — $ — — $ — — $ — — $ — Consumer — — 1 3 — — 2 326 Commercial — — 1 9 — — 1 9 Commercial real estate — — — — — — — — Total — $ — 2 $ 12 — $ — 3 $ 335 The recorded investment of TDRs in commercial, commercial real estate, and equipment financing segregated by risk rating exposure is as follows: (In thousands) At September 30, 2016 At December 31, 2015 (1) - (6) Pass $ 11,510 $ 12,970 (7) Special Mention 7 2,999 (8) Substandard 52,658 72,132 (9) Doubtful 3,597 1,717 Total $ 67,772 $ 89,818 |