Loans and Leases | Loans and Leases The following table summarizes loans and leases: At December 31, (In thousands) 2020 2019 Commercial non-mortgage $ 7,085,076 $ 5,296,611 Asset-based 890,598 1,046,886 Commercial real estate 6,322,637 5,949,339 Equipment financing 602,224 537,341 Commercial portfolio 14,900,535 12,830,177 Residential 4,782,016 4,972,685 Home equity 1,802,865 2,014,544 Other consumer 155,799 219,580 Consumer portfolio 6,740,680 7,206,809 Loans and leases (1) (2) (3) $ 21,641,215 $ 20,036,986 (1) Loan balances include net deferred (fees)/costs and net (premiums)/discounts of $(10.5) million and $17.6 million at December 31, 2020 and 2019, respectively. The change in net balance is driven by deferred fees on PPP loans. (2) At December 31, 2020, the Company had pledged $7.7 billion of eligible loans as collateral to support borrowing capacity at the FHLB of Boston and the FRB of Boston. (3) Loan balances exclude accrued interest receivable of $57.8 million and $59.0 million at December 31, 2020 and 2019, respectively, which is included in accrued interest receivable and other assets in the accompanying Consolidated Balance Sheets. Equipment financing includes net investment in leases of $236.1 million and $169.3 million at December 31, 2020 and 2019, respectively. Total undiscounted cash flows, primarily due within the next five years, amounted to $256.3 million at December 31, 2020. This lessor activity resulted in interest income of $7.1 million and $5.5 million for year ended December 31, 2020 and 2019, respectively. Loans and Leases Aging The following tables summarize the aging of loans and leases: At December 31, 2020 (In thousands) 30-59 Days 60-89 Days 90 or More Days Past Due Non-accrual Total Past Due and Non-accrual Current Total Loans Commercial non-mortgage $ 612 $ 903 $ 445 $ 64,073 $ 66,033 $ 7,019,043 $ 7,085,076 Asset-based 1,174 — — 2,594 3,768 886,830 890,598 Commercial real estate 2,400 619 — 21,231 24,250 6,298,387 6,322,637 Equipment financing 5,107 2,308 — 7,299 14,714 587,510 602,224 Commercial portfolio 9,293 3,830 445 95,197 108,765 14,791,770 14,900,535 Residential 4,334 6,330 — 41,081 51,745 4,730,271 4,782,016 Home equity 5,500 1,771 — 31,030 38,301 1,764,564 1,802,865 Other consumer 878 601 — 652 2,131 153,668 155,799 Consumer portfolio 10,712 8,702 — 72,763 92,177 6,648,503 6,740,680 Total $ 20,005 $ 12,532 $ 445 $ 167,960 $ 200,942 $ 21,440,273 $ 21,641,215 At December 31, 2019 (In thousands) 30-59 Days 60-89 Days 90 or More Days Past Due Non-accrual Total Past Due and Current Total Loans Commercial non-mortgage $ 2,094 $ 617 $ — $ 59,369 $ 62,080 $ 5,234,531 $ 5,296,611 Asset-based — — — 139 139 1,046,747 1,046,886 Commercial real estate 1,256 454 — 11,563 13,273 5,936,066 5,949,339 Equipment financing 5,493 292 — 5,433 11,218 526,123 537,341 Commercial portfolio 8,843 1,363 — 76,504 86,710 12,743,467 12,830,177 Residential 7,166 6,441 — 43,193 56,800 4,915,885 4,972,685 Home equity 8,267 5,551 — 30,170 43,988 1,970,556 2,014,544 Other consumer 4,269 807 — 1,192 6,268 213,312 219,580 Consumer portfolio 19,702 12,799 — 74,555 107,056 7,099,753 7,206,809 Total $ 28,545 $ 14,162 $ — $ 151,059 $ 193,766 $ 19,843,220 $ 20,036,986 The following table provides additional detail related to loans and leases on non-accrual status: At December 31, 2020 2019 (In thousands) Nonaccrual Nonaccrual With No Allowance Nonaccrual Nonaccrual With No Allowance Commercial non-mortgage $ 64,073 $ 16,985 $ 59,369 $ 13,584 Asset-based 2,594 — 139 — Commercial real estate 21,231 15,529 11,563 4,717 Equipment financing 7,299 2,983 5,433 2,159 Commercial portfolio 95,197 35,497 76,504 20,460 Residential 41,081 29,843 43,193 19,271 Home equity 31,030 24,091 30,170 15,195 Other consumer 652 2 1,192 — Consumer portfolio 72,763 53,936 74,555 34,466 Total $ 167,960 $ 89,433 $ 151,059 $ 54,926 Interest on non-accrual residential and home equity loans that would have been recorded as additional interest income had the loans been current in accordance with the original terms totaled $9.7 million, $11.3 million, and $9.7 million for the years ended December 31, 2020, 2019, and 2018, respectively. Allowance for Credit Losses on Loans and Leases The following tables summarize the activity in, as well as the loan and lease balances that were evaluated for, ACL on loans and leases: At or for the Years ended December 31, 2020 2019 2018 (In thousands) Commercial Portfolio Consumer Portfolio Total Commercial Portfolio Consumer Portfolio Total Commercial Portfolio Consumer Portfolio Total ACL on loans and leases: Beginning balance $ 161,669 $ 47,427 $ 209,096 $ 164,073 $ 48,280 $ 212,353 $ 144,746 $ 55,248 $ 199,994 Adoption of ASU No. 2016-13 (CECL) 34,024 23,544 57,568 — — — — — — Provision charged to expense 156,336 (18,488) 137,848 29,174 8,626 37,800 35,356 6,644 42,000 Charge-offs (42,925) (12,408) (55,333) (33,327) (19,153) (52,480) (20,704) (22,683) (43,387) Recoveries 3,140 7,112 10,252 1,749 9,674 11,423 4,675 9,071 13,746 Ending balance $ 312,244 $ 47,187 $ 359,431 $ 161,669 $ 47,427 $ 209,096 $ 164,073 $ 48,280 $ 212,353 Individually evaluated for impairment 11,687 4,450 16,137 9,428 4,821 14,249 9,681 5,669 15,350 Collectively evaluated for impairment $ 300,557 $ 42,737 $ 343,294 $ 152,241 $ 42,606 $ 194,847 $ 154,392 $ 42,611 $ 197,003 Loan and lease balances: Individually evaluated for impairment $ 163,655 $ 145,767 $ 309,422 $ 131,123 $ 125,287 $ 256,410 $ 116,655 $ 142,675 $ 259,330 Collectively evaluated for impairment 14,736,880 6,594,913 21,331,793 12,699,054 7,081,522 19,780,576 11,535,493 6,670,666 18,206,159 Loans and leases $ 14,900,535 $ 6,740,680 $ 21,641,215 $ 12,830,177 $ 7,206,809 $ 20,036,986 $ 11,652,148 $ 6,813,341 $ 18,465,489 The increase in ACL at December 31, 2020 as compared to December 31, 2019, is primarily attributable to the initial adoption of the CECL lifetime loss accounting model and the impact of current and forecasted macroeconomic conditions on credit models, which were negatively affected by the emergence of the COVID-19 pandemic in 2020. Credit Quality Indicators. To measure credit risk for the commercial portfolio, the Company employs a dual grade credit risk grading system for estimating the PD and LGD. This credit risk grading system has not changed with the adoption of CECL. 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) to (6) are considered pass ratings and (7) to (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" rating has a potential weakness that, if left uncorrected, may result in deterioration of the repayment prospects for the credit. A (8)-"Substandard" rating has a well-defined weakness that jeopardizes the full repayment of the debt. A (9)-"Doubtful" rating 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. Credits when classified as (10)-"Loss," in accordance with regulatory guidelines, are considered uncollectible and charged off. To measure credit risk for the consumer portfolio, the most relevant credit characteristic is the FICO score, which is a widely used credit scoring system that ranges from 300 to 850. A lower FICO score is indicative of higher credit risk. FICO scores are updated at least quarterly. The following table summarizes commercial, commercial real estate, and equipment financing loans and leases segregated by origination year and risk rating exposure under the Composite Credit Risk Profile grades as of December 31, 2020: (In thousands) 2020 2019 2018 2017 2016 Prior Revolving Loans Amortized Cost Basis Total Commercial non-mortgage Pass $ 2,771,373 $ 1,052,080 $ 907,110 $ 481,321 $ 231,280 $ 218,001 $ 936,592 $ 6,597,757 Special mention 32,535 33,969 62,034 435 8,357 13,757 38,496 189,583 Substandard 54,716 51,798 66,324 36,159 15,535 23,957 49,084 297,573 Doubtful — — — 163 — — — 163 Commercial non-mortgage 2,858,624 1,137,847 1,035,468 518,078 255,172 255,715 1,024,172 7,085,076 Asset-based Pass 26,344 15,960 23,123 11,333 10,963 16,484 741,336 845,543 Special mention — — 775 — — — 41,687 42,462 Substandard — 2,504 — — — — 89 2,593 Asset-based 26,344 18,464 23,898 11,333 10,963 16,484 783,112 890,598 Commercial real estate Pass 965,582 1,461,201 1,242,322 527,931 554,630 1,165,331 28,113 5,945,110 Special mention 27 10,385 70,704 37,539 35,617 69,832 — 224,104 Substandard 817 1,132 21,923 73,621 2,962 52,968 — 153,423 Commercial real estate 966,426 1,472,718 1,334,949 639,091 593,209 1,288,131 28,113 6,322,637 Equipment financing Pass 249,370 135,263 68,092 26,433 43,469 22,879 — 545,506 Special mention 7,934 11,043 6,981 1,220 1,577 788 — 29,543 Substandard 7,483 6,169 5,749 2,460 4,743 571 — 27,175 Equipment financing 264,787 152,475 80,822 30,113 49,789 24,238 — 602,224 Commercial portfolio $ 4,116,181 $ 2,781,504 $ 2,475,137 $ 1,198,615 $ 909,133 $ 1,584,568 $ 1,835,397 $ 14,900,535 The following table summarizes residential and consumer loans segregated by origination year and risk rating exposure under FICO score groupings as of December 31, 2020: (In thousands) 2020 2019 2018 2017 2016 Prior Revolving Loans Amortized Cost Basis Total Residential 800+ $ 360,336 $ 283,755 $ 61,048 $ 178,849 $ 268,044 $ 805,537 $ — $ 1,957,569 740-799 654,973 288,173 58,249 133,416 176,286 492,720 — 1,803,817 670-739 199,329 118,620 39,125 75,375 76,666 248,268 — 757,383 580-669 17,151 19,389 8,884 11,843 12,225 96,333 — 165,825 579 and below — 36,498 673 3,278 3,179 53,794 — 97,422 Residential 1,231,789 746,435 167,979 402,761 536,400 1,696,652 — 4,782,016 Home equity 800+ 30,604 16,567 25,205 14,439 17,192 59,956 542,600 706,563 740-799 34,797 13,565 19,715 11,073 12,839 43,802 434,271 570,062 670-739 13,753 8,855 10,761 10,206 7,318 44,025 275,691 370,609 580-669 1,708 2,172 2,660 2,234 2,316 16,680 86,126 113,896 579 and below 129 919 880 1,070 1,073 7,163 30,501 41,735 Home equity 80,991 42,078 59,221 39,022 40,738 171,626 1,369,189 1,802,865 Other consumer 800+ 2,827 5,725 2,610 658 115 190 7,171 19,296 740-799 12,317 21,036 8,925 1,493 457 263 5,119 49,610 670-739 14,761 31,952 11,843 2,284 665 228 8,403 70,136 580-669 2,344 5,419 2,360 793 194 124 1,570 12,804 579 and below 608 982 500 183 37 215 1,428 3,953 Other consumer 32,857 65,114 26,238 5,411 1,468 1,020 23,691 155,799 Consumer portfolio 1,345,637 853,627 253,438 447,194 578,606 1,869,298 1,392,880 6,740,680 Commercial portfolio 4,116,181 2,781,504 2,475,137 1,198,615 909,133 1,584,568 1,835,397 14,900,535 Loans and leases $ 5,461,818 $ 3,635,131 $ 2,728,575 $ 1,645,809 $ 1,487,739 $ 3,453,866 $ 3,228,277 $ 21,641,215 The following table presents the required credit quality disclosures prior to the adoption of CECL: At December 31, 2019 (In thousands) Commercial Commercial Real Estate Equipment Financing (1) - (6) Pass $ 5,985,338 $ 5,860,981 $ 528,561 (7) Special Mention 94,809 26,978 808 (8) Substandard 259,490 61,380 7,972 (9) Doubtful 3,860 — — Total $ 6,343,497 $ 5,949,339 $ 537,341 Individually Assessed Loans and Leases The following tables summarize individually assessed loans and leases: At December 31, 2020 (In thousands) Unpaid Amortized Cost Amortized Cost No Allowance Amortized Cost With Allowance Related Commercial non-mortgage $ 172,069 $ 119,884 $ 55,742 $ 64,142 $ 9,665 Asset-based 2,989 2,594 — 2,594 50 Commercial real estate 37,177 33,879 25,931 7,948 1,610 Equipment financing 7,770 7,298 2,983 4,315 362 Residential 108,077 98,164 58,915 39,249 3,357 Home equity 109,156 46,950 34,335 12,615 988 Other consumer 2,381 653 2 651 105 Total $ 439,619 $ 309,422 $ 177,908 $ 131,514 $ 16,137 At December 31, 2019 (In thousands) Unpaid Amortized Cost Amortized Cost Amortized Cost Related Commercial non-mortgage $ 140,096 $ 102,254 $ 29,739 $ 72,515 $ 7,862 Asset based 465 139 — 139 5 Commercial real estate 29,292 23,297 14,818 8,479 1,143 Equipment financing 5,591 5,433 2,159 3,274 418 Residential 98,790 90,096 56,231 33,865 3,618 Home equity 38,503 35,191 27,672 7,519 1,203 Other consumer — — — — — Total $ 312,737 $ 256,410 $ 130,619 $ 125,791 $ 14,249 (1) Partially charged-off other consumer loans were included in collectively evaluated for impairment at December 31, 2019. The following table summarizes average amortized cost and interest income recognized for individually assessed loans and leases: Years ended December 31, 2020 2019 2018 (In thousands) Average Accrued Cash Basis Interest Income Average Accrued Cash Basis Interest Income Average Accrued Cash Basis Interest Income Commercial non-mortgage $ 111,069 $ 3,836 $ — $ 100,771 $ 3,241 $ — $ 85,585 $ 3,064 $ — Asset based 1,367 — — 182 — — 407 — — Commercial real estate 28,588 699 — 17,062 385 — 11,027 198 — Equipment financing 6,366 — — 5,874 — — 4,820 112 — Residential 94,130 3,484 1,442 96,814 3,502 1,078 108,913 3,781 1,106 Home equity 41,070 1,315 1,826 37,167 1,045 981 42,290 1,158 980 Other consumer 327 32 — — — — — — — Total $ 282,917 $ 9,366 $ 3,268 $ 257,870 $ 8,173 $ 2,059 $ 253,042 $ 8,313 $ 2,086 Collateral Dependent Loans and Leases. A loan is considered collateral dependent when the borrower is experiencing financial difficulty and repayment is substantially expected through the operation or sale of collateral. A collateral dependent loan is individually assessed based on the fair value of the collateral, less costs to sell, as of the reporting date. Commercial non-mortgage, asset based, and equipment financing are collateralized by equipment, inventory, receivables, or other non-real estate assets. Commercial real estate, residential, and home equity are collateralized by real estate. Collateral value on collateral dependent loans and leases was $150.3 million at December 31, 2020 and $109.8 million at December 31, 2019. The following table summarizes whether, or not, individually assessed loans and leases are collateral dependent: At December 31, 2020 At December 31, 2019 (In thousands) Collateral Dependent Not Considered Collateral Dependent Total Collateral Dependent Not Considered Collateral Dependent Total Commercial non-mortgage $ 11,074 $ 108,810 $ 119,884 $ 10,682 $ 91,572 $ 102,254 Asset-based 2,504 90 2,594 — 139 139 Commercial real estate 28,482 5,397 33,879 14,097 9,200 23,297 Equipment financing — 7,298 7,298 — 5,433 5,433 Residential 33,980 64,184 98,164 17,635 72,461 90,096 Home equity 26,796 20,154 46,950 17,136 18,055 35,191 Other consumer — 653 653 — — — Total amortized cost of CDA $ 102,836 $ 206,586 $ 309,422 $ 59,550 $ 196,860 $ 256,410 Troubled Debt Restructurings The following table summarizes information for TDRs: At December 31, (Dollars in thousands) 2020 2019 Accrual status $ 140,089 $ 136,449 Non-accrual status 95,338 100,989 Total TDRs $ 235,427 $ 237,438 Specific reserves for TDRs included in the balance of ACL on loans and leases $ 12,728 $ 12,956 Additional funds committed to borrowers in TDR status 12,895 4,856 The portion of TDRs deemed to be uncollectible, $18.4 million, $21.8 million, and $14.3 million, for the years ended December 31, 2020, 2019 and 2018, respectively, were charged-off. The following table provides information on the type of concession for loans and leases modified as TDRs: Years ended December 31, 2020 2019 2018 Number of Post-Modification Recorded Investment (1) Number of Post-Modification Recorded Investment (1) Number of Post-Modification Recorded Investment (1) (Dollars in thousands) Commercial portfolio Extended Maturity 12 $ 1,142 18 $ 10,769 18 $ 1,656 Adjusted Interest Rate 1 96 2 112 — — Maturity/Rate Combined 9 984 11 673 18 10,327 Other (2) 27 40,434 31 70,002 21 46,359 Consumer portfolio Extended Maturity 6 673 13 1,926 5 489 Maturity/Rate Combined 15 1,467 19 2,381 15 1,565 Other (2) 122 10,895 42 2,908 66 6,385 Total TDRs 192 $ 55,691 136 $ 88,771 143 $ 66,781 (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. With respect to loans and leases modified as TDRs within the previous 12 months and for which there was a payment default, there were 4 loans and leases in the commercial portfolio with an amortized cost of $12.4 million for the year ended December 31, 2020. There were 7 loans and leases in the commercial portfolio with an amortized cost of $2.6 million for the year ended December 31, 2019. There were no significant amounts for the year ended December 31, 2018. TDRs in commercial non-mortgage, commercial real estate, and equipment financing segregated by risk rating exposure is as follows: At December 31, (In thousands) 2020 2019 Pass $ 12,462 $ 3,952 Special Mention — 63 Substandard 105,070 104,277 Doubtful 163 3,860 Total $ 117,695 $ 112,152 |