Loans and Leases | Loans and Leases The following table summarizes loans and leases: At December 31, (In thousands) 2017 2016 Residential $ 4,490,878 $ 4,254,682 Consumer 2,590,225 2,684,500 Commercial 5,368,694 4,940,931 Commercial Real Estate 4,523,828 4,510,846 Equipment Financing 550,233 635,629 Loans and leases (1) (2) $ 17,523,858 $ 17,026,588 (1) Loans and leases include net deferred fees and net premiums and discounts of $20.6 million and $17.3 million at December 31, 2017 and December 31, 2016 , respectively. (2) At December 31, 2017 , the Company had pledged $6.7 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, 2017 (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 $ 8,643 $ 5,146 $ — $ 44,481 $ 58,270 $ 4,432,608 $ 4,490,878 Consumer: Home equity 12,668 5,770 — 35,645 54,083 2,298,185 2,352,268 Other consumer 2,556 1,444 — 1,707 5,707 232,250 237,957 Commercial: Commercial non-mortgage 5,212 603 644 39,214 45,673 4,488,242 4,533,915 Asset-based — — — 589 589 834,190 834,779 Commercial real estate: Commercial real estate 478 77 248 4,484 5,287 4,238,987 4,244,274 Commercial construction — — — — — 279,554 279,554 Equipment financing 1,732 626 — 393 2,751 547,482 550,233 Total $ 31,289 $ 13,666 $ 892 $ 126,513 $ 172,360 $ 17,351,498 $ 17,523,858 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 Interest on non-accrual loans and leases that would have been recorded as additional interest income for the years ended December 31, 2017 , 2016 , and 2015 , had the loans and leases been current in accordance with their original terms, totaled $8.4 million , $11.0 million , and $8.2 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, 2017 (In thousands) Residential Consumer Commercial Commercial Real Estate Equipment Financing Total Allowance for loan and lease losses: Balance at January 1, 2017 $ 23,226 $ 45,233 $ 71,905 $ 47,477 $ 6,479 $ 194,320 Provision (benefit) charged to expense (2,692 ) 9,367 23,417 11,040 (232 ) 40,900 Losses charged off (2,500 ) (24,447 ) (8,147 ) (9,275 ) (558 ) (44,927 ) Recoveries 1,024 6,037 2,358 165 117 9,701 Balance at December 31, 2017 $ 19,058 $ 36,190 $ 89,533 $ 49,407 $ 5,806 $ 199,994 Individually evaluated for impairment $ 4,805 $ 1,668 $ 9,786 $ 272 $ 23 $ 16,554 Collectively evaluated for impairment $ 14,253 $ 34,522 $ 79,747 $ 49,135 $ 5,783 $ 183,440 Loan and lease balances: Individually evaluated for impairment $ 114,295 $ 45,436 $ 72,471 $ 11,226 $ 3,325 $ 246,753 Collectively evaluated for impairment 4,376,583 2,544,789 5,296,223 4,512,602 546,908 17,277,105 Loans and leases $ 4,490,878 $ 2,590,225 $ 5,368,694 $ 4,523,828 $ 550,233 $ 17,523,858 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 Impaired Loans and Leases The following tables summarize impaired loans and leases: At December 31, 2017 (In thousands) Unpaid Principal Balance Total Recorded Investment Recorded Investment No Allowance Recorded Investment With Allowance Related Valuation Allowance Residential: 1-4 family $ 125,352 $ 114,295 $ 69,759 $ 44,536 $ 4,805 Consumer home equity 50,809 45,436 34,418 11,018 1,668 Commercial: Commercial non-mortgage 79,900 71,882 27,313 44,569 9,786 Asset-based 3,272 589 589 — — Commercial real estate: Commercial real estate 11,994 11,226 6,387 4,839 272 Commercial construction — — — — — Equipment financing 3,409 3,325 2,932 393 23 Total $ 274,736 $ 246,753 $ 141,398 $ 105,355 $ 16,554 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 Asset based — — — — — 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 The following table summarizes the average recorded investment and interest income recognized for impaired loans and leases: Years ended December 31, 2017 2016 2015 (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 $ 116,859 $ 4,138 $ 1,264 $ 126,936 $ 4,377 $ 1,200 $ 138,215 $ 4,473 $ 1,139 Consumer home equity 45,578 1,323 1,046 47,072 1,361 985 49,337 1,451 1,099 Commercial Commercial non-mortgage 62,459 1,095 — 54,708 1,540 — 46,379 1,319 — Asset based 295 — — — — — — — — Commercial real estate: Commercial real estate 17,397 417 — 28,451 511 — 64,495 1,165 — Commercial construction 594 12 — 3,574 92 — 6,062 133 — Equipment financing 4,872 207 — 3,421 184 — 527 16 — Total $ 248,054 $ 7,192 $ 2,310 $ 264,162 $ 8,065 $ 2,185 $ 305,015 $ 8,557 $ 2,238 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 PD and the LGD. The credit risk grade system assigns a rating to each borrower and to the facility, which together form a Composite Credit Risk Profile. 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 Composite Credit Risk Profile has ten grades, with each grade corresponding to a progressively greater risk of loss. Grades (1) - (6) are considered pass ratings, and (7) - (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 a borrowers’ current financial position and outlook, risk profile, and the 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 (7) "Special Mention" credit has the potential weakness that, if left uncorrected, may result in deterioration of the repayment prospects for the asset. An (8) "Substandard" asset has a well defined weakness that jeopardizes the full repayment of the debt. An asset rated (9) "Doubtful" 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 (10) "Loss" 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 At December 31, At December 31, At December 31, (In thousands) 2017 2016 2017 2016 2017 2016 (1) - (6) Pass $ 5,048,162 $ 4,655,007 $ 4,355,916 $ 4,357,458 $ 525,105 $ 618,084 (7) Special Mention 104,594 56,240 62,065 69,023 8,022 1,324 (8) Substandard 206,883 226,603 105,847 84,365 17,106 16,221 (9) Doubtful 9,055 3,081 — — — — Total $ 5,368,694 $ 4,940,931 $ 4,523,828 $ 4,510,846 $ 550,233 $ 635,629 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 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 real estate price 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) 2017 2016 Accrual status $ 147,113 $ 147,809 Non-accrual status 74,291 75,719 Total recorded investment of TDR (1) $ 221,404 $ 223,528 Specific reserves for TDR included in the balance of ALLL $ 12,384 $ 14,583 Additional funds committed to borrowers in TDR status 2,736 459 (1) Total recorded investment of TDRs exclude $0.1 million and $0.7 million at December 31, 2017 and December 31, 2016 , respectively, of accrued interest receivable. For years ended December 31, 2017 , 2016 and 2015 , Webster charged off $3.2 million , $18.6 million , and $11.8 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, 2017 2016 2015 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 16 $ 2,569 17 $ 2,801 27 $ 4,909 Adjusted Interest rates 2 335 2 528 3 573 Combination Rate and Maturity 12 1,733 13 1,537 26 5,315 Other (2) 39 6,200 24 4,090 30 4,366 Consumer home equity: Extended Maturity 12 976 11 484 12 1,012 Adjusted Interest rates 1 247 — — — — Combination Rate and Maturity 14 3,469 15 1,156 12 945 Other (2) 73 4,907 52 3,131 68 3,646 Commercial non mortgage: Extended Maturity 12 1,233 12 14,883 3 254 Adjusted Interest rates — — — — 1 24 Combination Rate and Maturity 18 9,592 2 648 7 5,361 Other (2) 4 6,375 13 1,767 20 22,048 Commercial real estate: Extended Maturity — — 3 4,921 1 315 Adjusted Interest rates — — 1 237 — — Combination Rate and Maturity — — 2 335 1 42 Other (2) — — 1 509 1 405 Equipment Financing Extended Maturity — — 7 6,642 — — Total 203 $ 37,636 175 $ 43,669 212 $ 49,215 (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 were no significant amounts of loans and leases modified as TDRs within the previous 12 months and for which there was a payment default for the years ended December 31, 2017 , 2016 and 2015 . 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) 2017 2016 (1) - (6) Pass $ 8,268 $ 10,210 (7) Special Mention 355 7 (8) Substandard 53,050 45,509 (9) Doubtful — 2,738 Total $ 61,673 $ 58,464 |