Loans and Leases | Loans and Leases The following table summarizes loans and leases: At December 31, (In thousands) 2016 2015 Residential $ 4,254,682 $ 4,061,001 Consumer 2,684,500 2,702,560 Commercial 4,940,931 4,315,999 Commercial Real Estate 4,510,846 3,991,649 Equipment Financing 635,629 600,526 Loans and leases (1) (2) $ 17,026,588 $ 15,671,735 (1) Loans and leases include net deferred fees and net premiums and discounts of $17.3 million and $18.0 million at December 31, 2016 and December 31, 2015 , respectively. (2) At December 31, 2016 , the Company had pledged $6.4 billion of eligible loans as collateral to support borrowing capacity at the FHLB of Boston and the FRB of Boston. Loans and Leases Portfolio Aging The following tables summarize the aging of loans and leases: At December 31, 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 and Leases Residential $ 8,631 $ 2,609 $ — $ 47,279 $ 58,519 $ 4,196,163 $ 4,254,682 Consumer: Home equity 8,831 5,782 — 35,926 50,539 2,359,354 2,409,893 Other consumer 2,233 1,485 — 1,663 5,381 269,226 274,607 Commercial: Commercial non-mortgage 1,382 577 749 38,190 40,898 4,094,727 4,135,625 Asset-based — — — — — 805,306 805,306 Commercial real estate: Commercial real estate 6,357 1,816 — 9,871 18,044 4,117,742 4,135,786 Commercial construction — — — 662 662 374,398 375,060 Equipment financing 903 693 — 225 1,821 633,808 635,629 Total $ 28,337 $ 12,962 $ 749 $ 133,816 $ 175,864 $ 16,850,724 $ 17,026,588 At December 31, 2015 (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 and Leases 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 years ended December 31, 2016 , 2015 , and 2014 , had the loans and leases been current in accordance with their original terms, totaled $11.0 million , $8.2 million , and $9.3 million , respectively. Allowance for Loan and Lease Losses The following tables summarize the activity in, as well as the loan and lease balances that were evaluated for, the ALLL: At or for the Year ended December 31, 2016 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total Allowance for loan and lease losses: Balance at January 1, 2016 $ 25,876 $ 42,052 $ 59,977 $ 41,598 $ 5,487 $ 174,990 Provision (benefit) charged to expense 230 18,507 28,662 7,930 1,021 56,350 Losses charged off (4,636 ) (20,669 ) (18,360 ) (2,682 ) (565 ) (46,912 ) Recoveries 1,756 5,343 1,626 631 536 9,892 Balance at December 31, 2016 $ 23,226 $ 45,233 $ 71,905 $ 47,477 $ 6,479 $ 194,320 Individually evaluated for impairment $ 8,090 $ 2,903 $ 7,422 $ 169 $ 9 $ 18,593 Collectively evaluated for impairment $ 15,136 $ 42,330 $ 64,483 $ 47,308 $ 6,470 $ 175,727 Loan and lease balances: Individually evaluated for impairment $ 119,424 $ 45,719 $ 53,037 $ 24,755 $ 6,420 $ 249,355 Collectively evaluated for impairment 4,135,258 2,638,781 4,887,894 4,486,091 629,209 16,777,233 Loans and leases $ 4,254,682 $ 2,684,500 $ 4,940,931 $ 4,510,846 $ 635,629 $ 17,026,588 At or for the Year ended December 31, 2015 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total Allowance for loan and lease losses: Balance at January 1, 2015 $ 25,452 $ 43,518 $ 47,068 $ 37,148 $ 6,078 $ 159,264 Provision (benefit) charged to expense 6,057 11,847 21,693 11,381 (1,678 ) 49,300 Losses charged off (6,508 ) (17,679 ) (11,522 ) (7,578 ) (273 ) (43,560 ) Recoveries 875 4,366 2,738 647 1,360 9,986 Balance at December 31, 2015 $ 25,876 $ 42,052 $ 59,977 $ 41,598 $ 5,487 $ 174,990 Individually evaluated for impairment $ 10,364 $ 3,477 $ 5,197 $ 3,163 $ 3 $ 22,204 Collectively evaluated for impairment $ 15,512 $ 38,575 $ 54,780 $ 38,435 $ 5,484 $ 152,786 Loan and lease balances: Individually evaluated for impairment $ 134,448 $ 48,425 $ 56,581 $ 39,295 $ 422 $ 279,171 Collectively evaluated for impairment 3,926,553 2,654,135 4,259,418 3,952,354 600,104 15,392,564 Loans and leases $ 4,061,001 $ 2,702,560 $ 4,315,999 $ 3,991,649 $ 600,526 $ 15,671,735 At or for the Year ended December 31, 2014 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total Allowance for loan and lease losses: Balance at January 1, 2014 $ 23,027 $ 41,951 $ 46,655 $ 36,754 $ 4,186 $ 152,573 Provision (benefit) charged to expense 7,315 17,224 9,712 2,746 253 37,250 Losses charged off (6,214 ) (20,712 ) (13,668 ) (3,237 ) (595 ) (44,426 ) Recoveries 1,324 5,055 4,369 885 2,234 13,867 Balance at December 31, 2014 $ 25,452 $ 43,518 $ 47,068 $ 37,148 $ 6,078 $ 159,264 Individually evaluated for impairment $ 12,094 $ 4,237 $ 2,710 $ 6,232 $ 28 $ 25,301 Collectively evaluated for impairment $ 13,358 $ 39,281 $ 44,358 $ 30,916 $ 6,050 $ 133,963 Loan and lease balances: Individually evaluated for impairment $ 141,982 $ 50,249 $ 36,176 $ 101,817 $ 632 $ 330,856 Collectively evaluated for impairment 3,367,193 2,499,152 3,713,094 3,452,611 537,119 13,569,169 Loans and leases $ 3,509,175 $ 2,549,401 $ 3,749,270 $ 3,554,428 $ 537,751 $ 13,900,025 Impaired Loans and Leases The following tables summarize impaired loans and leases: At December 31, 2016 (In thousands) Unpaid Principal Balance Total Recorded Investment Recorded Investment No Allowance Recorded Investment With Allowance Related Valuation Allowance Residential: 1-4 family $ 131,468 $ 119,424 $ 21,068 $ 98,356 $ 8,090 Consumer: Home equity 52,432 45,719 22,746 22,973 2,903 Commercial: Commercial non-mortgage 57,732 53,037 26,006 27,031 7,422 Commercial real estate: Commercial real estate 24,146 23,568 19,591 3,977 169 Commercial construction 1,188 1,187 1,187 — — Equipment financing 6,398 6,420 6,197 223 9 Total $ 273,364 $ 249,355 $ 96,795 $ 152,560 $ 18,593 At December 31, 2015 (In thousands) Unpaid Principal Balance Total Recorded Investment Recorded Investment No Allowance Recorded Investment With Allowance Related Valuation Allowance Residential: 1-4 family $ 148,144 $ 134,448 $ 23,024 $ 111,424 $ 10,364 Consumer: Home equity 56,680 48,425 25,130 23,295 3,477 Commercial: Commercial non-mortgage 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: Years ended December 31, 2016 2015 2014 (In thousands) Average Recorded Investment Accrued Interest Income Cash Basis Interest Income Average Recorded Investment Accrued Interest Income Cash Basis Interest Income Average Accrued Cash Basis Interest Income Residential $ 126,936 $ 4,377 $ 1,200 $ 138,215 $ 4,473 $ 1,139 $ 142,198 $ 4,644 $ 1,221 Consumer 47,072 1,361 985 49,337 1,451 1,099 51,171 1,484 1,203 Commercial 54,708 1,540 — 46,379 1,319 — 44,097 2,326 — Commercial real estate: Commercial real estate 28,451 511 — 64,495 1,165 — 93,209 3,429 — Commercial construction 3,574 92 — 6,062 133 — 8,381 269 — Equipment financing 3,421 184 — 527 16 — 421 28 — Total $ 264,162 $ 8,065 $ 2,185 $ 305,015 $ 8,557 $ 2,238 $ 339,477 $ 12,180 $ 2,424 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 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 position and outlook, risk profile, and their related collateral and structural position. 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 December 31, At December 31, At December 31, At December 31, At December 31, At December 31, (1) - (6) Pass $ 4,655,007 $ 4,023,255 $ 4,357,458 $ 3,857,019 $ 618,084 $ 586,445 (7) Special Mention 56,240 70,904 69,023 55,030 1,324 1,628 (8) Substandard 226,603 220,389 84,365 79,289 16,221 12,453 (9) Doubtful 3,081 1,451 — 311 — — Total $ 4,940,931 $ 4,315,999 $ 4,510,846 $ 3,991,649 $ 635,629 $ 600,526 For residential and consumer loans, the Company considers factors such as past due status, updated FICO scores, employment status, home prices, loan to value, 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 Case-Shiller data indicates trends for Metropolitan Statistical Areas. 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: At December 31, (Dollars in thousands) 2016 2015 Accrual status $ 147,809 $ 171,784 Non-accrual status 75,719 100,906 Total recorded investment of TDR (1) $ 223,528 $ 272,690 Accruing TDR performing under modified terms more than one year 57.1 % 55.0 % Specific reserves for TDR included in the balance of ALLL $ 14,583 $ 21,405 Additional funds committed to borrowers in TDR status 459 1,133 (1) Total recorded investment of TDRs exclude $0.7 million and $1.1 million at December 31, 2016 and December 31, 2015 , respectively, of accrued interest receivable. For years ended December 31, 2016 , 2015 and 2014 , Webster charged off $18.6 million , $11.8 million , and $13.5 million , respectively, for the portion of TDRs deemed to be uncollectible. The following table provides information on the type of concession for loans and leases modified as TDRs: Years ended December 31, 2016 2015 2014 Number of Loans and Leases Post- Modification Recorded Investment (1) Number of Loans and Leases Post- Modification Recorded Investment (1) Number of Loans and Leases Post- Modification Recorded Investment (1) (Dollars in thousands) Residential: Extended Maturity 17 $ 2,801 27 $ 4,909 27 $ 3,547 Adjusted Interest rates 2 528 3 573 3 448 Combination Rate and Maturity 13 1,537 26 5,315 22 4,220 Other (2) 24 4,090 30 4,366 55 11,791 Consumer: Extended Maturity 11 484 12 1,012 19 944 Adjusted Interest rates — — — — 1 51 Combination Rate and Maturity 15 1,156 12 945 6 411 Other (2) 52 3,131 68 3,646 90 4,931 Commercial: Extended Maturity 12 14,883 3 254 7 422 Adjusted Interest rates — — 1 24 1 25 Combination Rate and Maturity 2 648 7 5,361 22 1,212 Other (2) 13 1,767 20 22,048 6 7,431 Commercial real estate: Extended Maturity 3 4,921 1 315 — — Adjusted Interest rates 1 237 — — — — Combination Rate and Maturity 2 335 1 42 2 11,106 Other (2) 1 509 1 405 — — Equipment Financing Extended Maturity 7 6,642 — — 1 492 Total 175 $ 43,669 212 $ 49,215 262 $ 47,031 (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, and/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: Years ended December 31, 2016 2015 2014 (Dollars in thousands) Number of Loans and Leases Recorded Investment Number of Loans and Leases Recorded Investment Number of Loans and Leases Recorded Investment Residential — $ — 1 $ 55 7 $ 1,494 Consumer — — 1 3 2 24 Total — $ — 2 $ 58 9 $ 1,518 The recorded investment of TDRs in commercial, commercial real estate, and equipment financing segregated by risk rating exposure is as follows: At December 31, (In thousands) 2016 2015 (1) - (6) Pass $ 10,210 $ 12,970 (7) Special Mention 7 2,999 (8) Substandard 45,509 72,132 (9) Doubtful 2,738 1,717 Total $ 58,464 $ 89,818 |