þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Virginia (State or other jurisdiction of incorporation or organization) | 23-2453088 (I.R.S. Employer Identification No.) | |
75 State Street, Boston, Massachusetts (Address of principal executive offices) | 02109 (Zip Code) |
Large accelerated filer o | Accelerated filer o | |
Non-accelerated filer þ | (Do not check if smaller reporting company) | |
Smaller reporting company o | ||
Emerging growth company o |
Class | Outstanding at July 31, 2018 | |
Common Stock (no par value) | 530,391,043 shares |
Page | |
Ex-31.1 Certification | |
Ex-31.2 Certification | |
Ex-32.1 Certification | |
Ex-32.2 Certification | |
EX-101 INSTANCE DOCUMENT | |
EX-101 SCHEMA DOCUMENT | |
EX-101 CALCULATION LINKBASE DOCUMENT | |
EX-101 LABELS LINKBASE DOCUMENT | |
EX-101 PRESENTATION LINKBASE DOCUMENT | |
EX-101 DEFINITION LINKBASE DOCUMENT |
• | the effects of regulation and/or policies of the Board of Governors of the Federal Reserve System (the “Federal Reserve”), the Federal Deposit Insurance Corporation (the "FDIC"), the Office of the Comptroller of the Currency (the “OCC”) and the Consumer Financial Protection Bureau (the “CFPB”), and other changes in monetary and fiscal policies and regulations, including interest rate policies of the Federal Reserve, as well as in the impact of changes in and interpretations of generally accepted accounting principles in the United States of America ("GAAP"), the failure to adhere to which could subject SHUSA to formal or informal regulatory compliance and enforcement actions; |
• | the slowing or reversal of the current U.S. economic expansion and the strength of the U.S. economy in general and regional and local economies in which SHUSA conducts operations in particular, which may affect, among other things, the level of non-performing assets, charge-offs, and provisions for credit losses; |
• | the ability of certain European member countries to continue to service their debt and the risk that a weakened European economy could negatively affect U.S.-based financial institutions, counterparties with which SHUSA does business, as well as the stability of global financial markets; |
• | inflation, interest rate, market and monetary fluctuations, which may, among other things, reduce net interest margins and impact funding sources and the ability to originate and distribute financial products in the primary and secondary markets; |
• | regulatory uncertainties and changes faced by financial institutions in the U.S. and globally arising from the U.S. presidential administration and Congress and the potential impact those uncertainties and changes could have on SHUSA's business, results of operations, financial condition or strategy; |
• | the pursuit of protectionist trade or other related policies by the U.S. and/or other countries |
• | adverse movements and volatility in debt and equity capital markets and adverse changes in the securities markets, including those related to the financial condition of significant issuers in SHUSA’s investment portfolio; |
• | SHUSA's ability to grow revenue, manage expenses, attract and retain highly-skilled people and raise capital necessary to achieve its business goals and comply with regulatory requirements; |
• | SHUSA’s ability to effectively manage its capital and liquidity, including approval of its capital plans by its regulators and its ability to continue to receive dividends from its subsidiaries or other investments; |
• | changes in credit ratings assigned to SHUSA or its subsidiaries; |
• | the ability to manage risks inherent in our businesses, including through effective use of systems and controls, insurance, derivatives and capital management; |
• | SHUSA’s ability to manage credit risk that may increase to the extent our loans are concentrated by loan type, industry segment, borrower type or location of the borrower or collateral; |
• | SHUSA’s ability to timely develop competitive new products and services in a changing environment that are responsive to the needs of SHUSA's customers and are profitable to SHUSA, the acceptance of such products and services by customers, and the potential for new products and services to impose additional unexpected costs, losses, or other liabilities not anticipated at their initiation, and expose SHUSA to increased operational risk; |
• | competitors of SHUSA that may have greater financial resources or lower costs, may innovate more effectively, or may develop products and technology that enable those competitors to compete more successfully than SHUSA; |
• | Santander Consumer USA Inc.'s ("SC's") agreement with Fiat Chrysler Automobiles US LLC ("FCA") may not result in currently anticipated levels of growth, is subject to performance conditions that could result in termination of the agreement, and is also subject to an option giving FCA the right to acquire an equity participation in the Chrysler Capital portion of SC's business; |
• | changes in customer spending or savings behavior, including changes due to recently enacted tax legislation; |
• | the ability of SHUSA and its third-party vendors to convert and maintain SHUSA’s data processing and related systems on a timely and acceptable basis and within projected cost estimates; |
• | SHUSA's ability to control operational risks, data security breach risks and outsourcing risks, and the possibility of errors in quantitative models SHUSA uses to manage its business, including as a result of cyber-attacks, technological failure, human error, fraud or malice, and the possibility that SHUSA's controls will prove insufficient, fail or be circumvented; |
• | the outcome of ongoing tax audits by federal, state and local income tax authorities that may require SHUSA to pay additional taxes or recover fewer overpayments compared to what has been accrued or paid as of period-end; |
• | changes to income tax laws and regulations; |
• | acts of terrorism or domestic or foreign military conflicts; and acts of God, including natural disasters; |
• | the costs and effects of regulatory or judicial proceedings, including possible business restrictions resulting from such proceedings; and |
• | adverse publicity, and negative public opinion, whether specific to SHUSA or regarding other industry participants or industry-wide factors, or other reputational harm. |
ABS: Asset-backed securities | DCF: Discounted cash flow | |
ACL: Allowance for credit losses | DFA: Dodd-Frank Wall Street Reform and Consumer Protection Act | |
AFS: Available-for-sale | DOJ: Department of Justice | |
ALLL: Allowance for loan and lease losses | DRIVE: Drive Auto Receivables Trust | |
Alt-A: Loans originated through brokers outside the Bank's geographic footprint, often lacking full documentation | DTI: Debt-to-income | |
ASC: Accounting Standards Codification | ECOA: Equal Credit Opportunity Act | |
ASU: Accounting Standards Update | EPS: Enhanced Prudential Standards | |
ATM: Automated teller machine | ETR: Effective tax rate | |
Bank: Santander Bank, National Association | Exchange Act: Securities Exchange Act of 1934, as amended | |
BEA: Bureau of Economic Analysis | FASB: Financial Accounting Standards Board | |
BHC: Bank holding company | FBO: Foreign banking organization | |
BOLI: Bank-owned life insurance | FCA: Fiat Chrysler Automobiles US LLC | |
BSI: Banco Santander International | FDIA: Federal Deposit Insurance Corporation Improvement Act | |
BSPR: Banco Santander Puerto Rico | FDIC: Federal Deposit Insurance Corporation | |
CBP: Citizens Bank of Pennsylvania | Federal Reserve: Board of Governors of the Federal Reserve System | |
CCAR: Comprehensive Capital Analysis and Review | FHLB: Federal Home Loan Bank | |
CD: Certificate(s) of deposit | FHLMC: Federal Home Loan Mortgage Corporation | |
CEF: Closed end fund | FICO®: Fair Isaac Corporation credit scoring model | |
CEO: Chief Executive Officer | Final Rule: Rule implementing certain of the EPS mandated by Section 165 of the DFA | |
CEVF: Commercial equipment vehicle financing | FINRA: Financial Industrial Regulatory Authority | |
CET1: Common equity Tier 1 | FNMA: Federal National Mortgage Association | |
CFPB: Consumer Financial Protection Bureau | FOB: Financial Oversight and Management Board of Puerto Rico | |
Change in Control: First quarter 2014 change in control and consolidation of SC | FRB: Federal Reserve Bank | |
Chrysler Agreement: Ten-year private label financing agreement with Fiat Chrysler Automobiles US LLC, formerly Chrysler Group LLC, signed by SC | FVO: Fair value option | |
Chrysler Capital: Trade name used in providing services under the Chrysler Agreement | GAAP: Accounting principles generally accepted in the United States of America | |
CIB: Corporate and Investment Banking | GAP: Guaranteed auto protection | |
CID: Civil investigative demand | GCB: Global Corporate Banking | |
CLTV: Combined loan-to-value | HFI: Held for investment | |
CMO: Collateralized mortgage obligation | HTM: Held to maturity | |
CMP: Civil monetary penalty | IHC: U.S. intermediate holding company | |
CODM: Chief Operating Decision Maker | IPO: Initial public offering | |
Company: Santander Holdings USA, Inc. | IRS: Internal Revenue Service | |
Consent Order: Consent order signed by the Bank with the CFPB on July 14, 2016 regarding the Bank’s overdraft coverage practices for ATM and one-time debit card transactions | ISDA: International Swaps and Derivatives Association, Inc. | |
COSO: Committee of Sponsoring Organizations | LendingClub: LendingClub Corporation, a peer-to-peer personal lending platform company from which SC acquires loans under flow agreements | |
Covered Fund: hedge fund or a private equity fund under the Volcker Rule | LCR: Liquidity coverage ratio |
CPR: Changes in anticipated loan prepayment rates | LHFI: Loans held-for-investment | |
CRA: Community Reinvestment Act | ||
CRE: Commercial Real Estate | SAM: Santander Asset Management, LLC | |
LHFS: Loans held-for-sale | Santander NY: New York branch of Santander | |
LIBOR: London Interbank Offered Rate | Santander UK: Santander UK plc | |
LTD: Long-term debt | SBNA: Santander Bank, National Association | |
LTV: Loan-to-value | SC: Santander Consumer USA Holdings Inc. and its subsidiaries | |
MBS: Mortgage-backed securities | SC Common Stock: Common shares of SC | |
MD&A: Management's Discussion and Analysis of Financial Condition and Results of Operations | SCF: Statement of cash flows | |
MSR: Mortgage servicing right | SCRA: Servicemembers' Civil Relief Act | |
MVE: Market value of equity | SDART: Santander Drive Auto Receivables Trust, a SC securitization platform | |
NCI: Non-controlling interest | SDGT: Specially Designated Global Terrorist | |
NMD: Non-maturity deposits | SEC: Securities and Exchange Commission | |
NMTC: New market tax credits | Securities Act: Securities Act of 1933, as amended | |
NPL: Non-performing loan | SFS: Santander Financial Services, Inc. | |
NSFR: Net stable funding ratio | SHUSA: Santander Holdings USA, Inc. | |
NYSE: New York Stock Exchange | SIS: Santander Investment Securities Inc. | |
OCC: Office of the Comptroller of the Currency | SPAIN: Santander Prime Auto Issuing Note Trust, a securitization platform | |
OEM: Original equipment manufacturer | SPE: Special purpose entity | |
OREO: Other real estate owned | Sponsor Holdings: Sponsor Auto Finance Holding Series LP | |
OTTI: Other-than-temporary impairment | SSLLC: Santander Securities LLC | |
Parent Company: the parent holding company of SBNA and other consolidated subsidiaries | Subvention: Reimbursement of the finance provider by a manufacturer for the difference between a market loan or lease rate and the below-market rate given to a customer. | |
PROMESA: Puerto Rico Management and Economic Stability Act | TCJA: Tax Cut and Jobs Act of 2017 | |
REIT: Real estate investment trust | TDR: Troubled debt restructuring | |
RIC: Retail installment contract | TLAC: Total loss-absorbing capacity | |
RV: Recreational vehicle | Trusts: Securitization trusts | |
RWA: Risk-weighted assets | UPB: Unpaid principal balance | |
S&P: Standard & Poor's | VIE: Variable interest entity | |
Santander: Banco Santander, S.A. | VOE: Voting rights entity | |
Santander BanCorp: Santander BanCorp and its subsidiaries | ||
June 30, 2018 | December 31, 2017 | ||||||
(in thousands) | |||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 6,127,604 | $ | 6,519,967 | |||
Investment securities: | |||||||
Available-for-sale ("AFS") at fair value | 13,064,873 | 14,413,183 | |||||
Held-to-maturity ("HTM") (fair value of $2,826,499 and $1,773,938 as of June 30, 2018 and December 31, 2017, respectively) | 2,920,087 | 1,799,808 | |||||
Other investments (includes Trading securities of $1,874 and $1 as of June 30, 2018 and December 31, 2017, respectively) | 700,858 | 658,864 | |||||
Loans held-for-investment ("LHFI")(1) (5) | 83,136,904 | 80,740,852 | |||||
Allowance for loan and lease losses ("ALLL") (5) | (3,810,734 | ) | (3,911,575 | ) | |||
Net LHFI | 79,326,170 | 76,829,277 | |||||
Loans held-for-sale ("LHFS") (2) | 1,559,799 | 2,522,486 | |||||
Premises and equipment, net (3) | 788,062 | 849,061 | |||||
Operating lease assets, net (5)(6) | 11,834,222 | 10,474,308 | |||||
Goodwill | 4,444,389 | 4,444,389 | |||||
Intangible assets, net | 505,194 | 535,753 | |||||
Bank-owned life insurance ("BOLI") | 1,813,977 | 1,795,700 | |||||
Restricted cash (5) | 3,123,208 | 3,818,807 | |||||
Other assets (4) (5) | 3,930,251 | 3,632,427 | |||||
TOTAL ASSETS | $ | 130,138,694 | $ | 128,294,030 | |||
LIABILITIES | |||||||
Accrued expenses and payables | $ | 3,238,550 | $ | 2,825,263 | |||
Deposits and other customer accounts | 61,556,548 | 60,831,103 | |||||
Borrowings and other debt obligations (5) | 38,771,378 | 39,003,313 | |||||
Advance payments by borrowers for taxes and insurance | 190,604 | 159,321 | |||||
Deferred tax liabilities, net | 1,144,002 | 969,996 | |||||
Other liabilities (5) | 1,085,133 | 799,403 | |||||
TOTAL LIABILITIES | 105,986,215 | 104,588,399 | |||||
Commitments and Contingencies (Note 16) | |||||||
STOCKHOLDER'S EQUITY | |||||||
Preferred stock (no par value; $25,000 liquidation preference; 7,500,000 shares authorized; 8,000 shares outstanding at both June 30, 2018 and December 31, 2017) | 195,445 | 195,445 | |||||
Common stock and paid-in capital (no par value; 800,000,000 shares authorized; 530,391,043 shares outstanding at both June 30, 2018 and December 31, 2017) | 17,732,184 | 17,723,010 | |||||
Accumulated other comprehensive loss | (409,449 | ) | (198,431 | ) | |||
Retained earnings | 3,931,614 | 3,462,674 | |||||
TOTAL SHUSA STOCKHOLDER'S EQUITY | 21,449,794 | 21,182,698 | |||||
Noncontrolling interest ("NCI") | 2,702,685 | 2,522,933 | |||||
TOTAL STOCKHOLDER'S EQUITY | 24,152,479 | 23,705,631 | |||||
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY | $ | 130,138,694 | $ | 128,294,030 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
(in thousands) | |||||||||||||||
INTEREST INCOME: | |||||||||||||||
Loans | $ | 1,813,853 | $ | 1,868,918 | $ | 3,561,579 | $ | 3,707,856 | |||||||
Interest-earning deposits | 33,939 | 20,476 | 66,452 | 38,910 | |||||||||||
Investment securities: | |||||||||||||||
AFS | 77,031 | 95,015 | 150,536 | 176,441 | |||||||||||
HTM | 17,181 | 10,011 | 34,245 | 20,643 | |||||||||||
Other investments | 4,599 | 5,025 | 9,848 | 11,188 | |||||||||||
TOTAL INTEREST INCOME | 1,946,603 | 1,999,445 | 3,822,660 | 3,955,038 | |||||||||||
INTEREST EXPENSE: | |||||||||||||||
Deposits and other customer accounts | 92,333 | 58,824 | 167,758 | 120,818 | |||||||||||
Borrowings and other debt obligations | 316,654 | 298,872 | 621,344 | 589,907 | |||||||||||
TOTAL INTEREST EXPENSE | 408,987 | 357,696 | 789,102 | 710,725 | |||||||||||
NET INTEREST INCOME | 1,537,616 | 1,641,749 | 3,033,558 | 3,244,313 | |||||||||||
Provision for credit losses | 379,834 | 604,768 | 882,368 | 1,340,214 | |||||||||||
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 1,157,782 | 1,036,981 | 2,151,190 | 1,904,099 | |||||||||||
NON-INTEREST INCOME: | |||||||||||||||
Consumer and commercial fees | 136,165 | 162,334 | 276,337 | 316,702 | |||||||||||
Lease income | 569,306 | 489,043 | 1,110,202 | 985,087 | |||||||||||
Miscellaneous income, net(1) (2) | 113,283 | 69,383 | 234,085 | 144,526 | |||||||||||
TOTAL FEES AND OTHER INCOME | 818,754 | 720,760 | 1,620,624 | 1,446,315 | |||||||||||
Net gains/(losses) on sale of investment securities | 419 | 9,049 | (244 | ) | 9,569 | ||||||||||
TOTAL NON-INTEREST INCOME | 819,173 | 729,809 | 1,620,380 | 1,455,884 | |||||||||||
GENERAL AND ADMINISTRATIVE EXPENSES: | |||||||||||||||
Compensation and benefits | 427,728 | 455,616 | 896,505 | 907,857 | |||||||||||
Occupancy and equipment expenses | 163,171 | 163,553 | 322,511 | 326,264 | |||||||||||
Technology, outside service, and marketing expense | 156,010 | 162,259 | 308,292 | 297,771 | |||||||||||
Loan expense | 97,679 | 95,872 | 194,493 | 194,217 | |||||||||||
Lease expense | 436,795 | 369,240 | 861,061 | 728,032 | |||||||||||
Other administrative expenses | 135,565 | 95,096 | 239,746 | 197,334 | |||||||||||
TOTAL GENERAL AND ADMINISTRATIVE EXPENSES | 1,416,948 | 1,341,636 | 2,822,608 | 2,651,475 | |||||||||||
OTHER EXPENSES: | |||||||||||||||
Amortization of intangibles | 15,288 | 15,424 | 30,576 | 30,915 | |||||||||||
Deposit insurance premiums and other expenses | 14,804 | 17,596 | 31,564 | 35,426 | |||||||||||
Loss on debt extinguishment | 1,201 | 3,991 | 3,413 | 10,740 | |||||||||||
Other miscellaneous expenses | 1,508 | 8,397 | 2,946 | 9,035 | |||||||||||
TOTAL OTHER EXPENSES | 32,801 | 45,408 | 68,499 | 86,116 | |||||||||||
INCOME BEFORE INCOME TAX PROVISION | 527,206 | 379,746 | 880,463 | 622,392 | |||||||||||
Income tax provision | 168,035 | 91,983 | 263,356 | 170,920 | |||||||||||
NET INCOME INCLUDING NCI | 359,171 | 287,763 | 617,107 | 451,472 | |||||||||||
LESS: NET INCOME ATTRIBUTABLE TO NCI | 104,018 | 104,724 | 178,416 | 155,352 | |||||||||||
NET INCOME ATTRIBUTABLE TO SANTANDER HOLDINGS USA, INC. | $ | 255,153 | $ | 183,039 | $ | 438,691 | $ | 296,120 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
(in thousands) | (in thousands) | ||||||||||||||
NET INCOME INCLUDING NCI | $ | 359,171 | $ | 287,763 | $ | 617,107 | $ | 451,472 | |||||||
OTHER COMPREHENSIVE INCOME, NET OF TAX | |||||||||||||||
Net unrealized (losses) / gains on cash flow hedge derivative financial instruments, net of tax (1) | (4,739 | ) | 6,523 | (22,103 | ) | 4,036 | |||||||||
Net unrealized (losses) / gains on AFS investment securities, net of tax (2) | (35,054 | ) | 15,349 | (145,984 | ) | 36,318 | |||||||||
Pension and post-retirement actuarial gains / (losses), net of tax | 625 | 556 | (3,837 | ) | 1,041 | ||||||||||
TOTAL OTHER COMPREHENSIVE (LOSS) / GAIN, NET OF TAX | (39,168 | ) | 22,428 | (171,924 | ) | 41,395 | |||||||||
COMPREHENSIVE INCOME | 320,003 | 310,191 | 445,183 | 492,867 | |||||||||||
NET INCOME ATTRIBUTABLE TO NCI | 104,018 | 104,724 | 178,416 | 155,352 | |||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO SHUSA | $ | 215,985 | $ | 205,467 | $ | 266,767 | $ | 337,515 |
Common Shares Outstanding | Preferred Stock | Common Stock and Paid-in Capital | Accumulated Other Comprehensive (Loss)/Income | Retained Earnings | Noncontrolling Interest | Total Stockholder's Equity | ||||||||||||||||||||
Balance, January 1, 2017 | 530,391 | 195,445 | 16,599,497 | (193,208 | ) | 3,020,149 | 2,756,875 | 22,378,758 | ||||||||||||||||||
Cumulative effect adjustment upon adoption of ASU 2016-09 | — | — | (26,456 | ) | — | 14,764 | 37,401 | 25,709 | ||||||||||||||||||
Comprehensive (loss)/income attributable to SHUSA | — | — | — | 41,395 | 296,120 | — | 337,515 | |||||||||||||||||||
Other comprehensive income attributable to NCI | — | — | — | — | — | (166 | ) | (166 | ) | |||||||||||||||||
Net income attributable to NCI | — | — | — | — | — | 155,352 | 155,352 | |||||||||||||||||||
Impact of SC stock option activity | — | — | — | — | — | 7,200 | 7,200 | |||||||||||||||||||
Capital from shareholder | — | — | 9,000 | — | — | — | 9,000 | |||||||||||||||||||
Stock issued in connection with employee benefit and incentive compensation plans | — | — | (164 | ) | — | — | — | (164 | ) | |||||||||||||||||
Dividends declared on common stock | — | — | — | — | (5,000 | ) | — | (5,000 | ) | |||||||||||||||||
Dividends declared on preferred stock ($7,300 paid) | — | — | — | — | (10,950 | ) | — | (10,950 | ) | |||||||||||||||||
Balance, June 30, 2017 | 530,391 | $ | 195,445 | $ | 16,581,877 | $ | (151,813 | ) | $ | 3,315,083 | $ | 2,956,662 | $ | 22,897,254 | ||||||||||||
Balance, January 1, 2018 | 530,391 | 195,445 | 17,723,010 | (198,431 | ) | 3,462,674 | 2,522,933 | 23,705,631 | ||||||||||||||||||
Cumulative-effect adjustment upon adoption of new accounting standards and other (Note 1) | — | — | — | (39,094 | ) | 47,549 | — | 8,455 | ||||||||||||||||||
Comprehensive income attributable to SHUSA | — | — | — | (171,924 | ) | 438,691 | — | 266,767 | ||||||||||||||||||
Other comprehensive income attributable to NCI | — | — | — | — | — | 5,797 | 5,797 | |||||||||||||||||||
Net income attributable to NCI | — | — | — | — | — | 178,416 | 178,416 | |||||||||||||||||||
Contribution from shareholder and related tax impact (Note17) | — | — | 9,174 | — | — | — | 9,174 | |||||||||||||||||||
Impact of stock issued in connection with employee benefit and incentive compensation plans | — | — | — | — | — | 7,074 | 7,074 | |||||||||||||||||||
Dividends declared and paid on common stock | — | — | — | — | (10,000 | ) | — | (10,000 | ) | |||||||||||||||||
Dividends declared and paid to NCI | — | — | — | — | — | (11,535 | ) | (11,535 | ) | |||||||||||||||||
Dividends declared and paid on preferred stock | — | — | — | — | (7,300 | ) | — | (7,300 | ) | |||||||||||||||||
Balance, June 30, 2018 | 530,391 | $ | 195,445 | $ | 17,732,184 | $ | (409,449 | ) | $ | 3,931,614 | $ | 2,702,685 | $ | 24,152,479 |
Six-Month Period Ended June 30, | |||||||
2018 | 2017 | ||||||
(in thousands) | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income including NCI | $ | 617,107 | $ | 451,472 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Provision for credit losses | 882,368 | 1,340,214 | |||||
Deferred tax expense | 241,916 | 162,613 | |||||
Depreciation, amortization and accretion(1) | 889,219 | 724,027 | |||||
Net loss on sale of loans | 148,838 | 169,072 | |||||
Net loss/(gain) on sale of investment securities | 244 | (9,569 | ) | ||||
Net gain on sale of operating leases | (171 | ) | (100 | ) | |||
Loss on debt extinguishment | 3,413 | 10,740 | |||||
Net loss/(gain) on real estate owned and premises and equipment | 3,288 | (4,910 | ) | ||||
Stock-based compensation | 501 | (736 | ) | ||||
Equity (income)/loss on equity method investments | (3,392 | ) | 1,506 | ||||
Originations of LHFS, net of repayments | (2,369,626 | ) | (2,438,217 | ) | |||
Purchases of LHFS | (620 | ) | (3,217 | ) | |||
Proceeds from sales of LHFS | 3,256,748 | 2,462,255 | |||||
Purchases of trading securities | (2,260 | ) | (10,331 | ) | |||
Proceeds from sales of trading securities | 2,567 | 13,640 | |||||
Net change in: | |||||||
Revolving personal loans | (72,921 | ) | (78,697 | ) | |||
Other assets and BOLI | (392,151 | ) | (254,277 | ) | |||
Other liabilities | 704,392 | (29,872 | ) | ||||
NET CASH PROVIDED BY OPERATING ACTIVITIES | 3,909,460 | 2,505,613 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Proceeds from sales of AFS investment securities | 39,446 | 997,306 | |||||
Proceeds from prepayments and maturities of AFS investment securities | 1,118,084 | 2,552,576 | |||||
Purchases of AFS investment securities | (1,194,315 | ) | (5,144,019 | ) | |||
Proceeds from prepayments and maturities of HTM investment securities | 175,806 | 78,696 | |||||
Purchases of held to maturity investment securities | (135,898 | ) | — | ||||
Proceeds from sales of other investments | 63,024 | 117,081 | |||||
Purchases of other investments | (64,678 | ) | (88,987 | ) | |||
Proceeds from sales of LHFI | 826,085 | 288,805 | |||||
Proceeds from the sales of equity method investments | — | 17,717 | |||||
Distributions from equity method investments | 2,189 | 4,305 | |||||
Contributions to equity method and other investments | (52,341 | ) | (35,673 | ) | |||
Proceeds from settlements of BOLI policies | 10,888 | 14,147 | |||||
Purchases of LHFI | (559,358 | ) | (136,550 | ) | |||
Net change in loans other than purchases and sales | (3,525,399 | ) | 1,684,297 | ||||
Purchases and originations of operating leases | (4,804,003 | ) | (3,055,983 | ) | |||
Proceeds from the sale and termination of operating leases(1) | 2,212,897 | 1,845,431 | |||||
Manufacturer incentives | 443,905 | 551,100 | |||||
Proceeds from sales of real estate owned and premises and equipment | 27,782 | 63,485 | |||||
Purchases of premises and equipment | (70,756 | ) | (58,404 | ) | |||
NET CASH USED IN INVESTING ACTIVITIES | (5,486,642 | ) | (304,670 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Net change in deposits and other customer accounts | 725,445 | (4,284,135 | ) | ||||
Net change in short-term borrowings | 571,142 | 1,677,414 | |||||
Net proceeds from long-term borrowings | 23,140,364 | 26,834,482 | |||||
Repayments of long-term borrowings | (22,560,831 | ) | (26,829,907 | ) | |||
Proceeds from Federal Home Loan Bank ("FHLB") advances (with terms greater than 3 months) | — | 1,000,000 | |||||
Repayments of FHLB advances (with terms greater than 3 months) | (1,400,000 | ) | (2,850,000 | ) | |||
Net change in advance payments by borrowers for taxes and insurance | 31,283 | 14,040 | |||||
Cash dividends paid to preferred stockholders | (7,300 | ) | (7,300 | ) | |||
Dividends paid on common stock | (10,000 | ) | — | ||||
Dividends paid to noncontrolling interest | (11,535 | ) | — | ||||
Proceeds from the issuance of common stock | 4,911 | 3,334 | |||||
Capital contribution from shareholder | 5,741 | 9,000 | |||||
NET CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES | 489,220 | (4,433,072 | ) | ||||
NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH (2) | (1,087,962 | ) | (2,232,129 | ) | |||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD (2) | 10,338,774 | 13,052,807 | |||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (2) | $ | 9,250,812 | $ | 10,820,678 | |||
NON-CASH TRANSACTIONS | |||||||
Loans transferred from/(to) held-for-investment ("HFI") (from)/to held-for-sale, net ("HFS") | 724,616 | 30,135 | |||||
Unsettled purchases of investment securities | — | 289,569 | |||||
Unsettled sales of investment securities | — | 308,819 | |||||
Unsettled clean-up calls | — | (74,405 | ) | ||||
AFS investment securities transferred to HTM investment securities | 1,167,189 | — |
• | ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as amended. This ASU requires an entity to recognize revenue for the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It includes a five-step process to assist an entity in achieving the main principles of revenue recognition under ASC 606. Because the ASU does not apply to revenue associated with leases and financial instruments (including loans, securities, and derivatives), it did not have a material impact on the elements of the Company's Consolidated Statements of Operations most closely associated with leases and financial instruments (such as interest income, interest expense and securities gains and losses). |
(in thousands) | Balance at December 31, 2017 | Adjustments | Balance at January 1, 2018 | |||||||||
Assets - LHFI | $ | 80,740,852 | $ | 5,514 | $ | 80,746,366 | ||||||
Other assets | 3,632,427 | (3,592 | ) | 3,628,835 | ||||||||
Total assets | 128,294,030 | 1,922 | 128,295,952 | |||||||||
Liabilities - other liabilities | 799,403 | (1,378 | ) | 798,025 | ||||||||
Total liabilities | 104,588,399 | (1,378 | ) | 104,587,021 | ||||||||
Stockholders' equity - retained earnings | 3,462,674 | 3,300 | 3,465,974 | |||||||||
Total stockholders' equity | 23,705,631 | 3,300 | 23,708,931 |
June 30, 2018 | ||||||||
(in thousands) | As Reported | Balance Without Adoption | ||||||
Assets - LHFI | $ | 83,136,904 | $ | 83,131,949 | ||||
Other assets | 3,930,251 | 3,933,647 | ||||||
Total assets | 130,138,694 | 130,137,135 | ||||||
Liabilities - other liabilities | 1,085,133 | 1,086,511 | ||||||
Total liabilities | 105,986,215 | 105,987,593 | ||||||
Stockholders' equity - retained earnings | 3,931,614 | 3,928,677 | ||||||
Total stockholders' equity | 24,152,479 | 24,149,542 |
Three-Month Period Ended June 30, 2018 | Six-Month Period Ended June 30, 2018 | |||||||||||||||
(in thousands) | As Reported | Balance Without Adoption | As Reported | Balance Without Adoption | ||||||||||||
Non-interest income | ||||||||||||||||
Consumer and commercial fees | $ | 136,165 | $ | 137,051 | $ | 276,337 | $ | 274,944 | ||||||||
Miscellaneous income/(loss) | 113,283 | 105,241 | 234,085 | 224,123 | ||||||||||||
Total non-interest income | 819,173 | 812,017 | 1,620,380 | 1,609,025 | ||||||||||||
General and administrative expense | ||||||||||||||||
Technology, outside service, and marketing expense | 156,010 | 154,284 | 308,292 | 304,395 | ||||||||||||
Loan expense | 97,679 | 100,197 | 194,493 | 199,390 | ||||||||||||
Other administrative expenses | 135,565 | 130,050 | 239,746 | 226,832 | ||||||||||||
Total general and administrative expenses | 1,416,948 | 1,411,596 | 2,822,608 | 2,810,694 | ||||||||||||
Income before income tax provision | 527,206 | 527,558 | 880,463 | 881,022 | ||||||||||||
Income tax provision | 168,035 | 168,158 | 263,356 | 263,552 | ||||||||||||
Net income | $ | 359,171 | $ | 359,400 | $ | 617,107 | $ | 617,470 |
• | ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, as amended. This new guidance amends the presentation and accounting for certain financial instruments, including liabilities measured at fair value under the FVO and equity investments. The guidance also updates fair value presentation and disclosure requirements for financial instruments measured at amortized cost. The Company adopted this standard on January 1, 2018, and it did not have a material impact on the Company's financial position or results of operations. As a result of the adoption of this standard, the Company reclassified approximately $10.0 million of equity securities from Investments AFS to Other investments on January 1, 2018. Future changes in the fair value of the Company's equity securities will be recognized in the Condensed Consolidated Statements of Operations rather than Other comprehensive Income. |
• | ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. This new guidance amends the hedge accounting model to enable entities to better portray their risk management activities in their financial statements. The amendments expand an entity’s ability to hedge nonfinancial and financial risk components and reduce complexity in hedges of interest rate risk. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness, and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line in which the earnings effect of the hedged item is reported. The new guidance is effective for public companies for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The Company adopted this standard in the first quarter of 2018. It did not have a material impact |
• | ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The amendments in this ASU allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cut and Jobs Act of 2017 (the “TCJA"). As a result of adoption of this ASU in the first quarter of 2018, the Company reclassified $39.1 million from accumulated other comprehensive income with an offsetting credit to retained earnings. |
Impact to Retained earnings | ||||
(in thousands) | ||||
Adoption of ASU 2014-09, Revenue Recognition | $ | 3,300 | ||
Adoption of ASU 2016-1, Financial Instruments | (418 | ) | ||
Adoption of ASU 2018-02, Statement of Comprehensive Income | 39,094 | |||
Cumulative-effect adjustment upon adoption of new accounting standards | $ | 41,976 | ||
Other adjustments at subsidiary | 5,573 | |||
Net impact to opening Retained earnings | $ | 47,549 |
• | ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments |
• | ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory |
• | ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (A consensus of the FASB Emerging Issues Task Force) |
• | ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business |
• | ASU 2017-05, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets |
• | ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost |
• | ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting |
• | ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 |
• | ASU 2018-06, Codification Improvements to Topic 942, Financial Services—Depository and Lending |
• | ASU 2017-06, Plan Accounting: Defined Benefit Pension Plans (Topic 960), Defined Contribution Pension Plans (Topic 962), Health and Welfare Benefit Plans (Topic 965): Employee Benefit Plan Master Trust Reporting (a consensus of the Emerging Issues Task Force) |
• | ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities |
• | ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception |
• | ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
(in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Loss | Fair Value | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Loss | Fair Value | ||||||||||||||||||||||||
U.S. Treasury securities | $ | 1,632,805 | $ | 171 | $ | (15,174 | ) | $ | 1,617,802 | $ | 1,006,219 | $ | — | $ | (8,107 | ) | $ | 998,112 | ||||||||||||||
Corporate debt securities | 6,454 | — | (1 | ) | 6,453 | 11,639 | 21 | — | 11,660 | |||||||||||||||||||||||
Asset-backed securities (“ABS”) | 475,279 | 5,066 | (2,868 | ) | 477,477 | 501,575 | 6,901 | (1,314 | ) | 507,162 | ||||||||||||||||||||||
Equity securities (1) | — | — | — | — | 11,428 | — | (614 | ) | 10,814 | |||||||||||||||||||||||
State and municipal securities | 20 | — | — | 20 | 23 | — | — | 23 | ||||||||||||||||||||||||
Mortgage-backed securities (“MBS”): | ||||||||||||||||||||||||||||||||
Government National Mortgage Association ("GNMA") - Residential | 3,818,120 | 5,752 | (109,410 | ) | 3,714,462 | 4,745,998 | 3,531 | (62,524 | ) | 4,687,005 | ||||||||||||||||||||||
GNMA - Commercial | 866,797 | — | (22,528 | ) | 844,269 | 1,377,449 | 179 | (19,917 | ) | 1,357,711 | ||||||||||||||||||||||
Federal Home Loan Mortgage Corporation ("FHLMC") and Federal National Mortage Association ("FNMA") - Residential | 6,610,005 | 237 | (257,435 | ) | 6,352,807 | 6,958,433 | 1,093 | (141,393 | ) | 6,818,133 | ||||||||||||||||||||||
FHLMC and FNMA - Commercial | 52,346 | 125 | (888 | ) | 51,583 | 23,003 | — | (440 | ) | 22,563 | ||||||||||||||||||||||
Total investments in debt securities AFS | $ | 13,461,826 | $ | 11,351 | $ | (408,304 | ) | $ | 13,064,873 | $ | 14,635,767 | $ | 11,725 | $ | (234,309 | ) | $ | 14,413,183 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
(in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Loss | Fair Value | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Loss | Fair Value | ||||||||||||||||||||||||
MBS: | ||||||||||||||||||||||||||||||||
GNMA - Residential | $ | 1,866,434 | $ | — | $ | (69,059 | ) | $ | 1,797,375 | $ | 1,447,669 | $ | 722 | $ | (26,150 | ) | $ | 1,422,241 | ||||||||||||||
GNMA - Commercial | 1,053,653 | 622 | (25,151 | ) | 1,029,124 | 352,139 | 325 | (767 | ) | 351,697 | ||||||||||||||||||||||
Total investments in debt securities HTM | $ | 2,920,087 | $ | 622 | $ | (94,210 | ) | $ | 2,826,499 | $ | 1,799,808 | $ | 1,047 | $ | (26,917 | ) | $ | 1,773,938 |
(in thousands) | Amortized Cost | Fair Value | ||||||
Due within one year | $ | 788,156 | $ | 573,700 | ||||
Due after 1 year but within 5 years | 1,211,917 | 1,416,164 | ||||||
Due after 5 years but within 10 years | 181,937 | 246,373 | ||||||
Due after 10 years | 11,279,816 | 10,828,636 | ||||||
Total | $ | 13,461,826 | $ | 13,064,873 |
(in thousands) | Amortized Cost | Fair Value | ||||||
Due after 10 years | $ | 2,920,087 | $ | 2,826,499 | ||||
Total | $ | 2,920,087 | $ | 2,826,499 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
Less than 12 months | 12 months or longer | Less than 12 months | 12 months or longer | |||||||||||||||||||||||||||||
(in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||
U.S. Treasury securities | $ | 788,943 | $ | (10,459 | ) | $ | 246,895 | $ | (4,715 | ) | $ | 998,112 | $ | (8,107 | ) | $ | — | $ | — | |||||||||||||
Corporate debt securities | 6,439 | (1 | ) | 13 | — | — | — | — | — | |||||||||||||||||||||||
ABS | 43,740 | (440 | ) | 86,900 | (2,428 | ) | 8,013 | (125 | ) | 103,559 | (1,189 | ) | ||||||||||||||||||||
Equity securities (1) | — | — | — | — | 335 | (2 | ) | 10,398 | (612 | ) | ||||||||||||||||||||||
MBS: | ||||||||||||||||||||||||||||||||
GNMA - Residential | 1,132,254 | (29,533 | ) | 1,812,027 | (79,877 | ) | 1,236,716 | (8,600 | ) | 2,583,955 | (53,924 | ) | ||||||||||||||||||||
GNMA - Commercial | 805,131 | (21,818 | ) | 39,138 | (710 | ) | 1,022,452 | (11,492 | ) | 251,209 | (8,425 | ) | ||||||||||||||||||||
FHLMC and FNMA - Residential | 3,247,620 | (88,401 | ) | 3,082,057 | (169,034 | ) | 3,429,678 | (32,899 | ) | 3,017,533 | (108,494 | ) | ||||||||||||||||||||
FHLMC and FNMA - Commercial | 6,619 | (351 | ) | 15,175 | (537 | ) | 6,948 | (103 | ) | 15,614 | (337 | ) | ||||||||||||||||||||
Total investments in debt securities AFS | $ | 6,030,746 | $ | (151,003 | ) | $ | 5,282,205 | $ | (257,301 | ) | $ | 6,702,254 | $ | (61,328 | ) | $ | 5,982,268 | $ | (172,981 | ) |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
Less than 12 months | 12 months or longer | Less than 12 months | 12 months or longer | |||||||||||||||||||||||||||||
(in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||
MBS: | ||||||||||||||||||||||||||||||||
GNMA - Residential | $ | 464,230 | $ | (14,342 | ) | $ | 1,333,145 | $ | (54,717 | ) | $ | 434,322 | $ | (6,419 | ) | $ | 739,612 | $ | (19,731 | ) | ||||||||||||
GNMA - Commercial | 626,942 | (16,986 | ) | 316,697 | (8,165 | ) | 118,951 | (767 | ) | — | — | |||||||||||||||||||||
Total investments in debt securities HTM | $ | 1,091,172 | $ | (31,328 | ) | $ | 1,649,842 | $ | (62,882 | ) | $ | 553,273 | $ | (7,186 | ) | $ | 739,612 | $ | (19,731 | ) |
Three-Month Period Ended June 30, 2018 | Six-Month Period Ended June 30, | |||||||||||||||
(in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Proceeds from the sales of debt securities AFS | $ | — | $ | 1,306,125 | $ | 39,446 | $ | 1,306,125 | ||||||||
Gross realized gains | $ | 419 | $ | 11,125 | $ | — | $ | 11,125 | ||||||||
Gross realized losses | — | (2,076 | ) | (244 | ) | (1,556 | ) | |||||||||
OTTI | — | — | — | — | ||||||||||||
Net realized gains/(losses) (1) | $ | 419 | $ | 9,049 | $ | (244 | ) | $ | 9,569 |
(1) | Includes net realized gains/(losses) on trading securities of $0.4 million and $(0.2) million for the three-month and six-month periods ended June 30, 2018, respectively, and $(2.1) million and $(1.6) million for the three-month and six-month periods ended June 30, 2017, respectively. |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
FHLB of Pittsburgh and Federal Reserve Bank stock | $ | 488,134 | $ | 516,693 | ||||
Low Income Housing Tax Credit investments ("LIHTC") | 115,933 | 88,170 | ||||||
Equity securities not held for trading | 10,917 | — | ||||||
CDs with a maturity greater than 90 days | 84,000 | 54,000 | ||||||
Trading securities | 1,874 | 1 | ||||||
Total | $ | 700,858 | $ | 658,864 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | |||||||||||||
(in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||
Net gains/(losses) on equity securities1 | $ | (78 | ) | $ | 36 | (31 | ) | 18 | ||||||
Less: net gains/(losses) recognized during the period on equity securities sold during the period1 | — | — | — | — | ||||||||||
Unrealized gains/(losses) recognized during the reporting period on equity securities still held at the reporting period date1 | $ | (78 | ) | $ | 36 | (31 | ) | 18 |
(1) | Changes in the fair value of equity securities were not recognized in earnings prior to the adoption of ASU 2016-01. |
June 30, 2018 | December 31, 2017 | |||||||||||||
(dollars in thousands) | Amount | Percent | Amount | Percent | ||||||||||
Commercial LHFI: | ||||||||||||||
Commercial real estate ("CRE") loans | $ | 9,053,402 | 10.9 | % | $ | 9,279,225 | 11.5 | % | ||||||
Commercial and industrial loans | 14,695,706 | 17.7 | % | 14,438,311 | 17.9 | % | ||||||||
Multifamily loans | 8,323,925 | 10.0 | % | 8,274,435 | 10.1 | % | ||||||||
Other commercial(2) | 7,466,771 | 9.0 | % | 7,174,739 | 8.9 | % | ||||||||
Total commercial LHFI | 39,539,804 | 47.6 | % | 39,166,710 | 48.4 | % | ||||||||
Consumer loans secured by real estate: | ||||||||||||||
Residential mortgages | 9,464,713 | 11.4 | % | 8,846,765 | 11.0 | % | ||||||||
Home equity loans and lines of credit | 5,682,230 | 6.8 | % | 5,907,733 | 7.3 | % | ||||||||
Total consumer loans secured by real estate | 15,146,943 | 18.2 | % | 14,754,498 | 18.3 | % | ||||||||
Consumer loans not secured by real estate: | ||||||||||||||
RICs and auto loans - originated | 25,404,300 | 30.6 | % | 23,081,424 | 28.6 | % | ||||||||
RICs and auto loans - purchased | 1,246,606 | 1.5 | % | 1,834,868 | 2.3 | % | ||||||||
Personal unsecured loans | 1,277,301 | 1.5 | % | 1,285,677 | 1.6 | % | ||||||||
Other consumer(3) | 521,950 | 0.6 | % | 617,675 | 0.8 | % | ||||||||
Total consumer loans | 43,597,100 | 52.4 | % | 41,574,142 | 51.6 | % | ||||||||
Total LHFI(1) | $ | 83,136,904 | 100.0 | % | $ | 80,740,852 | 100.0 | % | ||||||
Total LHFI: | ||||||||||||||
Fixed rate | $ | 52,903,597 | 63.6 | % | $ | 50,653,790 | 62.7 | % | ||||||
Variable rate | 30,233,307 | 36.4 | % | 30,087,062 | 37.3 | % | ||||||||
Total LHFI(1) | $ | 83,136,904 | 100.0 | % | $ | 80,740,852 | 100.0 | % |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
RICs - Purchased HFI: | ||||||||
Unpaid principal balance ("UPB") (1) | $ | 1,310,800 | $ | 1,929,548 | ||||
UPB - FVO (2) | 15,756 | 24,926 | ||||||
Total UPB | 1,326,556 | 1,954,474 | ||||||
Purchase marks (3) | (79,950 | ) | (119,606 | ) | ||||
Total RICs - Purchased HFI | 1,246,606 | 1,834,868 | ||||||
RICs - Originated HFI: | ||||||||
UPB (1) | 25,540,231 | 23,373,202 | ||||||
Net discount | (195,499 | ) | (309,920 | ) | ||||
Total RICs - Originated | 25,344,732 | 23,063,282 | ||||||
SBNA auto loans | 59,568 | 18,142 | ||||||
Total RICs - originated post-Change in Control | 25,404,300 | 23,081,424 | ||||||
Total RICs and auto loans HFI | $ | 26,650,906 | $ | 24,916,292 |
(1) | UPB does not include amounts related to the loan receivables - unsecured and loan receivables from dealers due to the short-term and revolving nature of these receivables. |
(2) | The Company elected to account for these loans, which were acquired with evidence of credit deterioration, under the FVO. |
(3) | Includes purchase marks of $3.5 million and $5.5 million related to purchase loan portfolios on which we elected to apply the FVO at June 30, 2018 and December 31, 2017, respectively. |
Three-Month Period Ended June 30, 2018 | ||||||||||||||||
Commercial | Consumer | Unallocated | Total | |||||||||||||
(in thousands) | ||||||||||||||||
ALLL, beginning of period | $ | 462,074 | $ | 3,344,112 | $ | 47,023 | $ | 3,853,209 | ||||||||
(Release of) / Provision for loan and lease losses | (33,213 | ) | 415,940 | — | 382,727 | |||||||||||
Charge-offs | (16,665 | ) | (1,036,520 | ) | — | (1,053,185 | ) | |||||||||
Recoveries | 14,624 | 613,359 | — | 627,983 | ||||||||||||
Charge-offs, net of recoveries | (2,041 | ) | (423,161 | ) | — | (425,202 | ) | |||||||||
ALLL, end of period | $ | 426,820 | $ | 3,336,891 | $ | 47,023 | $ | 3,810,734 | ||||||||
Reserve for unfunded lending commitments, beginning of period | $ | 89,543 | $ | 323 | $ | — | $ | 89,866 | ||||||||
Release of reserve for unfunded lending commitments | (2,885 | ) | (8 | ) | — | (2,893 | ) | |||||||||
Reserve for unfunded lending commitments, end of period | 86,658 | 315 | — | 86,973 | ||||||||||||
Total ACL, end of period | $ | 513,478 | $ | 3,337,206 | $ | 47,023 | $ | 3,897,707 | ||||||||
Six-Month Period Ended June 30, 2018 | ||||||||||||||||
(in thousands) | Commercial | Consumer | Unallocated | Total | ||||||||||||
Allowance for loan and lease losses ("ALLL"), beginning of period | $ | 443,796 | $ | 3,420,756 | $ | 47,023 | $ | 3,911,575 | ||||||||
Provision for loan and lease losses | 8,020 | 896,486 | — | 904,506 | ||||||||||||
Charge-offs | (49,625 | ) | (2,255,456 | ) | — | (2,305,081 | ) | |||||||||
Recoveries | 24,629 | 1,275,105 | — | 1,299,734 | ||||||||||||
Charge-offs, net of recoveries | (24,996 | ) | (980,351 | ) | — | (1,005,347 | ) | |||||||||
ALLL, end of period | $ | 426,820 | $ | 3,336,891 | $ | 47,023 | $ | 3,810,734 | ||||||||
Reserve for unfunded lending commitments, beginning of period | $ | 108,805 | $ | 306 | $ | — | $ | 109,111 | ||||||||
(Release of) / Provision for reserve for unfunded lending commitments | (22,147 | ) | 9 | — | (22,138 | ) | ||||||||||
Reserve for unfunded lending commitments, end of period | 86,658 | 315 | — | 86,973 | ||||||||||||
Total ACL, end of period | $ | 513,478 | $ | 3,337,206 | $ | 47,023 | $ | 3,897,707 | ||||||||
Ending balance, individually evaluated for impairment(1) | $ | 83,148 | $ | 1,534,387 | $ | — | $ | 1,617,535 | ||||||||
Ending balance, collectively evaluated for impairment | 343,672 | 1,802,504 | 47,023 | 2,193,199 | ||||||||||||
Financing receivables: | ||||||||||||||||
Ending balance | $ | 39,605,332 | $ | 45,091,371 | $ | — | $ | 84,696,703 | ||||||||
Ending balance, evaluated under the FVO or lower of cost or fair value | 65,528 | 1,521,803 | — | 1,587,331 | ||||||||||||
Ending balance, individually evaluated for impairment(1) | 509,693 | 6,332,923 | — | 6,842,616 | ||||||||||||
Ending balance, collectively evaluated for impairment | 39,030,111 | 37,236,645 | — | 76,266,756 |
(1) | Consists of loans in troubled debt restructuring ("TDR") status. |
Three-Month Period Ended June 30, 2017 | ||||||||||||||||
Commercial | Consumer | Unallocated | Total | |||||||||||||
(in thousands) | ||||||||||||||||
ALLL, beginning of period | $ | 453,019 | $ | 3,422,821 | $ | 47,023 | $ | 3,922,863 | ||||||||
(Release of) / Provision for loan and lease losses | 26,687 | 584,998 | — | 611,685 | ||||||||||||
Charge-offs | (60,514 | ) | (1,128,919 | ) | — | (1,189,433 | ) | |||||||||
Recoveries | 9,056 | 599,437 | — | 608,493 | ||||||||||||
Charge-offs, net of recoveries | (51,458 | ) | (529,482 | ) | — | (580,940 | ) | |||||||||
ALLL, end of period | $ | 428,248 | $ | 3,478,337 | $ | 47,023 | $ | 3,953,608 | ||||||||
Reserve for unfunded lending commitments, beginning of period | $ | 119,620 | $ | 776 | $ | — | $ | 120,396 | ||||||||
(Release of) / Provision for unfunded lending commitments | (6,937 | ) | 20 | — | (6,917 | ) | ||||||||||
Loss on unfunded lending commitments | (1,668 | ) | — | — | (1,668 | ) | ||||||||||
Reserve for unfunded lending commitments, end of period | 111,015 | 796 | — | 111,811 | ||||||||||||
Total ACL, end of period | $ | 539,263 | $ | 3,479,133 | $ | 47,023 | $ | 4,065,419 | ||||||||
Six-Month Period Ended June 30, 2017 | ||||||||||||||||
(in thousands) | Commercial | Consumer | Unallocated | Total | ||||||||||||
ALLL, beginning of period | $ | 449,835 | $ | 3,317,606 | $ | 47,023 | $ | 3,814,464 | ||||||||
Provision for loan and lease losses | 45,465 | 1,303,556 | — | 1,349,021 | ||||||||||||
Charge-offs | (86,687 | ) | (2,366,199 | ) | — | (2,452,886 | ) | |||||||||
Recoveries | 19,635 | 1,223,374 | — | 1,243,009 | ||||||||||||
Charge-offs, net of recoveries | (67,052 | ) | (1,142,825 | ) | — | (1,209,877 | ) | |||||||||
ALLL, end of period | $ | 428,248 | $ | 3,478,337 | $ | 47,023 | $ | 3,953,608 | ||||||||
Reserve for unfunded lending commitments, beginning of period | $ | 121,613 | $ | 806 | $ | — | $ | 122,419 | ||||||||
Release of unfunded lending commitments | (8,797 | ) | (10 | ) | — | (8,807 | ) | |||||||||
Loss on unfunded lending commitments | (1,801 | ) | — | — | (1,801 | ) | ||||||||||
Reserve for unfunded lending commitments, end of period | 111,015 | 796 | — | 111,811 | ||||||||||||
Total ACL, end of period | $ | 539,263 | $ | 3,479,133 | $ | 47,023 | $ | 4,065,419 | ||||||||
Ending balance, individually evaluated for impairment(1) | $ | 73,946 | $ | 1,636,770 | $ | — | $ | 1,710,716 | ||||||||
Ending balance, collectively evaluated for impairment | 354,302 | 1,841,567 | 47,023 | 2,242,892 | ||||||||||||
Financing receivables: | ||||||||||||||||
Ending balance | $ | 41,233,130 | $ | 44,227,460 | $ | — | $ | 85,460,590 | ||||||||
Ending balance, evaluated under the FVO or lower of cost or fair value(1) | 160,252 | 2,377,177 | — | 2,537,429 | ||||||||||||
Ending balance, individually evaluated for impairment(1) | 640,255 | 6,202,430 | — | 6,842,685 | ||||||||||||
Ending balance, collectively evaluated for impairment | 40,432,623 | 35,647,853 | — | 76,080,476 |
(1) | Consists of loans in TDR status. |
Three-Month Period Ended | Six-Month Period Ended | ||||||||||||||||||||||
June 30, 2018 | June 30, 2018 | ||||||||||||||||||||||
(in thousands) | Purchased | Originated | Total | Purchased | Originated | Total | |||||||||||||||||
ALLL, beginning of period | $ | 322,726 | $ | 2,782,640 | $ | 3,105,366 | $ | 384,167 | $ | 2,779,044 | $ | 3,163,211 | |||||||||||
(Release of) / Provision for loan and lease losses | (30,031 | ) | 397,433 | 367,402 | (45,861 | ) | 884,593 | 838,732 | |||||||||||||||
Charge-offs | (76,265 | ) | (921,748 | ) | (998,013 | ) | (181,775 | ) | (2,000,263 | ) | (2,182,038 | ) | |||||||||||
Recoveries | 49,791 | 556,887 | 606,678 | 109,690 | 1,151,838 | 1,261,528 | |||||||||||||||||
Charge-offs, net of recoveries | (26,474 | ) | (364,861 | ) | (391,335 | ) | (72,085 | ) | (848,425 | ) | (920,510 | ) | |||||||||||
ALLL, end of period | $ | 266,221 | $ | 2,815,212 | $ | 3,081,433 | $ | 266,221 | $ | 2,815,212 | $ | 3,081,433 |
Three-Month Period Ended | Six-Month Period Ended | ||||||||||||||||||||||
June 30, 2017 | June 30, 2017 | ||||||||||||||||||||||
(in thousands) | Purchased | Originated | Total | Purchased | Originated | Total | |||||||||||||||||
ALLL, beginning of period | $ | 495,221 | $ | 2,707,884 | $ | 3,203,105 | $ | 559,092 | $ | 2,538,127 | $ | 3,097,219 | |||||||||||
Provision for loan and lease losses | 55,141 | 502,256 | 557,397 | 81,266 | 1,162,779 | 1,244,045 | |||||||||||||||||
Charge-offs | (150,143 | ) | (939,328 | ) | (1,089,471 | ) | (338,829 | ) | (1,947,381 | ) | (2,286,210 | ) | |||||||||||
Recoveries | 68,452 | 521,854 | 590,306 | 167,142 | 1,039,141 | 1,206,283 | |||||||||||||||||
Charge-offs, net of recoveries | (81,691 | ) | (417,474 | ) | (499,165 | ) | (171,687 | ) | (908,240 | ) | (1,079,927 | ) | |||||||||||
ALLL, end of period | $ | 468,671 | $ | 2,792,666 | $ | 3,261,337 | $ | 468,671 | $ | 2,792,666 | $ | 3,261,337 |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Non-accrual loans: | ||||||||
Commercial: | ||||||||
CRE | $ | 123,305 | $ | 139,236 | ||||
Commercial and industrial | 162,134 | 230,481 | ||||||
Multifamily | 28,501 | 11,348 | ||||||
Other commercial | 77,052 | 83,468 | ||||||
Total commercial loans | 390,992 | 464,533 | ||||||
Consumer: | ||||||||
Residential mortgages | 241,886 | 265,436 | ||||||
Home equity loans and lines of credit | 125,834 | 134,162 | ||||||
RICs and auto loans - originated | 1,924,294 | 1,816,226 | ||||||
RICs - purchased | 203,346 | 256,617 | ||||||
Personal unsecured loans | 7,035 | 2,366 | ||||||
Other consumer | 8,570 | 10,657 | ||||||
Total consumer loans | 2,510,965 | 2,485,464 | ||||||
Total non-accrual loans | 2,901,957 | 2,949,997 | ||||||
Other real estate owned ("OREO") | 118,502 | 130,777 | ||||||
Repossessed vehicles | 147,430 | 210,692 | ||||||
Foreclosed and other repossessed assets | 1,212 | 2,190 | ||||||
Total OREO and other repossessed assets | 267,144 | 343,659 | ||||||
Total non-performing assets | $ | 3,169,101 | $ | 3,293,656 |
As of: | ||||||||||||||||||||||||
June 30, 2018 | ||||||||||||||||||||||||
(in thousands) | 30-89 Days Past Due | 90 Days or Greater | Total Past Due | Current | Total Financing Receivables(1) | Recorded Investment > 90 Days and Accruing | ||||||||||||||||||
Commercial: | ||||||||||||||||||||||||
CRE | $ | 15,236 | $ | 82,133 | $ | 97,369 | $ | 8,956,033 | $ | 9,053,402 | $ | — | ||||||||||||
Commercial and industrial (1) | 66,136 | 81,113 | 147,249 | 14,613,986 | 14,761,235 | — | ||||||||||||||||||
Multifamily | 5,538 | 8,369 | 13,907 | 8,310,018 | 8,323,925 | — | ||||||||||||||||||
Other commercial | 23,740 | 2,954 | 26,694 | 7,440,076 | 7,466,770 | — | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||
Residential mortgages | 189,762 | 194,558 | 384,320 | 9,338,096 | 9,722,416 | — | ||||||||||||||||||
Home equity loans and lines of credit | 42,235 | 82,809 | 125,044 | 5,557,186 | 5,682,230 | — | ||||||||||||||||||
RICs and auto loans - originated | 3,038,768 | 229,528 | 3,268,296 | 22,416,117 | 25,684,413 | — | ||||||||||||||||||
RICs and auto loans - purchased | 300,474 | 21,587 | 322,061 | 924,545 | 1,246,606 | — | ||||||||||||||||||
Personal unsecured loans | 91,172 | 100,735 | 191,907 | 2,041,849 | 2,233,756 | 88,162 | ||||||||||||||||||
Other consumer | 14,351 | 10,379 | 24,730 | 497,220 | 521,950 | — | ||||||||||||||||||
Total | $ | 3,787,412 | $ | 814,165 | $ | 4,601,577 | $ | 80,095,126 | $ | 84,696,703 | $ | 88,162 |
(1) | Commercial and industrial loans includes $65.5 million of LHFS at June 30, 2018. |
(2) | Residential mortgages includes $257.7 million of LHFS at June 30, 2018. |
(3) | RICs and auto loans includes $280.1 million of LHFS at June 30, 2018. |
(4) | Personal unsecured loans includes $956.5 million of LHFS at June 30, 2018. |
As of | ||||||||||||||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
(in thousands) | 30-89 Days Past Due | 90 Days or Greater | Total Past Due | Current | Total Financing Receivable(1) | Recorded Investment > 90 Days and Accruing | ||||||||||||||||||
Commercial: | ||||||||||||||||||||||||
CRE | $ | 25,174 | $ | 100,524 | $ | 125,698 | $ | 9,153,527 | $ | 9,279,225 | $ | — | ||||||||||||
Commercial and industrial | 49,584 | 75,924 | 125,508 | 14,461,981 | 14,587,489 | — | ||||||||||||||||||
Multifamily | 3,562 | 2,990 | 6,552 | 8,267,883 | 8,274,435 | — | ||||||||||||||||||
Other commercial | 34,021 | 3,359 | 37,380 | 7,137,359 | 7,174,739 | — | ||||||||||||||||||
Consumer: | ||||||||||||||||||||||||
Residential mortgages | 217,558 | 210,777 | 428,335 | 8,628,600 | 9,056,935 | — | ||||||||||||||||||
Home equity loans and lines of credit | 50,919 | 91,975 | 142,894 | 5,764,839 | 5,907,733 | — | ||||||||||||||||||
RICs and auto loans - originated | 3,405,721 | 327,045 | 3,732,766 | 20,449,706 | 24,182,472 | — | ||||||||||||||||||
RICs and auto loans - purchased | 452,235 | 40,516 | 492,751 | 1,342,117 | 1,834,868 | — | ||||||||||||||||||
Personal unsecured loans | 85,394 | 105,054 | 190,448 | 2,157,319 | 2,347,767 | 96,461 | ||||||||||||||||||
Other consumer | 24,879 | 14,220 | 39,099 | 578,576 | 617,675 | — | ||||||||||||||||||
Total | $ | 4,349,047 | $ | 972,384 | $ | 5,321,431 | $ | 77,941,907 | $ | 83,263,338 | $ | 96,461 |
(1) | Commercial and industrial loans included$149.2 million of LHFS at December 31, 2017. |
(2) | Residential mortgages included $210.2 million of LHFS at December 31, 2017, |
(3) | RICs and auto loans included $1.1 billion of LHFS at December 31, 2017. |
(4) | Personal unsecured loans included $1.1 billion of LHFS at December 31, 2017. |
June 30, 2018 | ||||||||||||||||
(in thousands) | Recorded Investment(1) | UPB | Related Specific Reserves | Average Recorded Investment | ||||||||||||
With no related allowance recorded: | ||||||||||||||||
Commercial: | ||||||||||||||||
CRE | $ | 123,390 | $ | 131,958 | $ | — | $ | 124,898 | ||||||||
Commercial and industrial | 42,551 | 56,786 | — | 62,546 | ||||||||||||
Multifamily | 15,051 | 15,984 | — | 12,469 | ||||||||||||
Other commercial | 2,143 | 2,159 | — | 1,455 | ||||||||||||
Consumer: | ||||||||||||||||
Residential mortgages | 149,804 | 202,187 | — | 128,562 | ||||||||||||
Home equity loans and lines of credit | 52,375 | 54,442 | — | 52,386 | ||||||||||||
RICs and auto loans - originated | 8 | 8 | — | 4 | ||||||||||||
RICs and auto loans - purchased | 11,091 | 14,249 | — | 13,642 | ||||||||||||
Personal unsecured loans(2) | 31,380 | 31,380 | — | 31,186 | ||||||||||||
Other consumer | 4,138 | 4,138 | — | 6,848 | ||||||||||||
With an allowance recorded: | ||||||||||||||||
Commercial: | ||||||||||||||||
CRE | 88,132 | 101,985 | 12,762 | 92,906 | ||||||||||||
Commercial and industrial | 152,889 | 171,757 | 47,874 | 164,829 | ||||||||||||
Multifamily | — | — | — | 3,101 | ||||||||||||
Other commercial | 70,495 | 70,495 | 22,512 | 74,104 | ||||||||||||
Consumer: | ||||||||||||||||
Residential mortgages | 272,569 | 312,075 | 30,277 | 297,331 | ||||||||||||
Home equity loans and lines of credit | 62,999 | 75,158 | 5,221 | 63,913 | ||||||||||||
RICs and auto loans - originated | 4,886,182 | 4,921,618 | 1,243,143 | 4,837,241 | ||||||||||||
RICs and auto loans - purchased | 878,021 | 992,305 | 247,611 | 1,022,249 | ||||||||||||
Personal unsecured loans | 16,473 | 16,860 | 7,005 | 16,475 | ||||||||||||
Other consumer | 10,351 | 13,616 | 1,130 | 10,972 | ||||||||||||
Total: | ||||||||||||||||
Commercial | $ | 494,651 | $ | 551,124 | $ | 83,148 | $ | 536,308 | ||||||||
Consumer | 6,375,391 | 6,638,036 | 1,534,387 | 6,480,809 | ||||||||||||
Total | $ | 6,870,042 | $ | 7,189,160 | $ | 1,617,535 | $ | 7,017,117 |
(1) | Recorded investment includes deferred loan fees, net of deferred origination costs and unamortized purchase premiums, net of discounts, as well as purchase accounting adjustments. |
(2) | Includes LHFS. |
December 31, 2017 | ||||||||||||||||
(in thousands) | Recorded Investment(1) | UPB | Related Specific Reserves | Average Recorded Investment | ||||||||||||
With no related allowance recorded: | ||||||||||||||||
Commercial: | ||||||||||||||||
CRE | $ | 126,406 | $ | 174,842 | $ | — | $ | 139,063 | ||||||||
Commercial and industrial | 82,541 | 96,324 | — | 75,338 | ||||||||||||
Multifamily | 9,887 | 10,838 | — | 10,129 | ||||||||||||
Other commercial | 767 | 911 | — | 903 | ||||||||||||
Consumer: | ||||||||||||||||
Residential mortgages | 107,320 | 128,458 | — | 141,195 | ||||||||||||
Home equity loans and lines of credit | 52,397 | 54,421 | — | 50,635 | ||||||||||||
RICs and auto loans - purchased | 16,192 | 20,783 | — | 25,283 | ||||||||||||
Personal unsecured loans(2) | 30,992 | 30,992 | — | 28,500 | ||||||||||||
Other consumer | 9,557 | 13,055 | — | 14,446 | ||||||||||||
With an allowance recorded: | ||||||||||||||||
Commercial: | ||||||||||||||||
CRE | 97,680 | 117,730 | 18,523 | 118,492 | ||||||||||||
Commercial and industrial | 176,769 | 200,382 | 59,696 | 196,674 | ||||||||||||
Multifamily | 6,201 | 6,201 | 313 | 4,566 | ||||||||||||
Other commercial | 77,712 | 77,772 | 23,794 | 42,465 | ||||||||||||
Consumer: | ||||||||||||||||
Residential mortgages | 322,092 | 392,833 | 40,963 | 303,361 | ||||||||||||
Home equity loans and lines of credit | 64,827 | 77,435 | 4,770 | 57,345 | ||||||||||||
RICs and auto loans - originated | 4,788,299 | 4,847,929 | 1,350,022 | 4,029,808 | ||||||||||||
RICs and auto loans - purchased | 1,166,476 | 1,318,306 | 347,663 | 1,511,212 | ||||||||||||
Personal unsecured loans | 16,477 | 16,661 | 6,259 | 16,668 | ||||||||||||
Other consumer | 11,592 | 15,290 | 2,151 | 12,343 | ||||||||||||
Total: | ||||||||||||||||
Commercial | $ | 577,963 | $ | 685,000 | $ | 102,326 | $ | 587,630 | ||||||||
Consumer | 6,586,221 | 6,916,163 | 1,751,828 | 6,190,796 | ||||||||||||
Total | $ | 7,164,184 | $ | 7,601,163 | $ | 1,854,154 | $ | 6,778,426 |
(1) | Recorded investment includes deferred loan fees, net of deferred origination costs and unamortized purchase premiums, net of discounts, as well as purchase accounting adjustments. |
(2) | Includes LHFS. |
June 30, 2018 | CRE | Commercial and industrial | Multifamily | Remaining commercial | Total(1) | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Rating: | ||||||||||||||||||||
Pass | $ | 8,083,421 | $ | 13,542,599 | $ | 8,153,959 | $ | 7,331,209 | $ | 37,111,188 | ||||||||||
Special mention | 622,906 | 786,928 | 116,139 | 57,189 | 1,583,162 | |||||||||||||||
Substandard | 318,542 | 357,163 | 53,827 | 16,280 | 745,812 | |||||||||||||||
Doubtful | 28,533 | 74,545 | — | 62,092 | 165,170 | |||||||||||||||
Total commercial loans | $ | 9,053,402 | $ | 14,761,235 | $ | 8,323,925 | $ | 7,466,770 | $ | 39,605,332 |
(1) | Financing receivables include LHFS. |
December 31, 2017 | CRE | Commercial and industrial | Multifamily | Remaining commercial | Total(1) | |||||||||||||||
(in thousands) | ||||||||||||||||||||
Rating: | ||||||||||||||||||||
Pass | $ | 8,281,626 | $ | 13,176,248 | $ | 8,123,727 | $ | 7,059,627 | $ | 36,641,228 | ||||||||||
Special mention | 645,835 | 941,683 | 105,225 | 29,657 | 1,722,400 | |||||||||||||||
Substandard | 317,510 | 398,325 | 45,483 | 21,747 | 783,065 | |||||||||||||||
Doubtful | 34,254 | 71,233 | — | 63,708 | 169,195 | |||||||||||||||
Total commercial loans | $ | 9,279,225 | $ | 14,587,489 | $ | 8,274,435 | $ | 7,174,739 | $ | 39,315,888 |
(1) | Financing receivables include LHFS. |
Credit Score Range(2) | June 30, 2018 | December 31, 2017 | ||||||||||||
(dollars in thousands) | RICs and auto loans(3) | Percent | RICs and auto loans(3) | Percent | ||||||||||
No FICO®(1) | $ | 3,403,051 | 12.6 | % | $ | 4,530,238 | 17.4 | % | ||||||
<600 | 14,547,771 | 54.0 | % | 13,395,203 | 51.4 | % | ||||||||
600-639 | 4,812,533 | 17.9 | % | 4,332,278 | 16.7 | % | ||||||||
>=640 | 4,167,664 | 15.5 | % | 3,759,621 | 14.5 | % | ||||||||
Total | $ | 26,931,019 | 100.0 | % | $ | 26,017,340 | 100.0 | % |
(1) | Consists primarily of loans for which credit scores are not considered in the ALLL model. |
(2) | Credit scores updated quarterly. |
(3) | RICs and auto loans include $280.1 million and $1.1 billion of LHFS at June 30, 2018 and December 31, 2017, respectively, that do not have an allowance. |
Residential Mortgages(1)(3) | ||||||||||||||||||||||||||||||||
June 30, 2018 | N/A(2) | LTV<=70% | 70.01-80% | 80.01-90% | 90.01-100% | 100.01-110% | LTV>110% | Grand Total | ||||||||||||||||||||||||
FICO Score | (dollars in thousands) | |||||||||||||||||||||||||||||||
N/A(2) | $ | 321,527 | $ | 6,177 | $ | 696 | $ | 125 | $ | — | $ | — | $ | — | $ | 328,525 | ||||||||||||||||
<600 | 122 | 225,222 | 57,160 | 36,241 | 23,164 | 2,478 | 1,291 | 345,678 | ||||||||||||||||||||||||
600-639 | — | 165,555 | 40,221 | 32,254 | 32,891 | 723 | 3,875 | 275,519 | ||||||||||||||||||||||||
640-679 | — | 303,105 | 110,602 | 84,804 | 100,378 | 1,733 | 7,226 | 607,848 | ||||||||||||||||||||||||
680-719 | 51 | 584,346 | 263,437 | 137,239 | 166,263 | 2,900 | 5,241 | 1,159,477 | ||||||||||||||||||||||||
720-759 | 89 | 1,041,861 | 534,160 | 193,645 | 215,346 | 5,038 | 6,563 | 1,996,702 | ||||||||||||||||||||||||
>=760 | 308 | 3,248,228 | 1,191,487 | 321,021 | 229,639 | 6,924 | 11,060 | 5,008,667 | ||||||||||||||||||||||||
Grand Total | $ | 322,097 | $ | 5,574,494 | $ | 2,197,763 | $ | 805,329 | $ | 767,681 | $ | 19,796 | $ | 35,256 | $ | 9,722,416 |
Home Equity Loans and Lines of Credit(2) | ||||||||||||||||||||||||
June 30, 2018 | N/A(1) | LTV<=70% | 70.01-90% | 90.01-110% | LTV>110% | Grand Total | ||||||||||||||||||
FICO Score | (dollars in thousands) | |||||||||||||||||||||||
N/A(1) | $ | 182,480 | $ | 1,754 | $ | 967 | $ | — | $ | — | $ | 185,201 | ||||||||||||
<600 | 7,595 | 194,995 | 66,231 | 16,682 | 5,645 | 291,148 | ||||||||||||||||||
600-639 | 5,127 | 161,678 | 53,759 | 7,206 | 6,776 | 234,546 | ||||||||||||||||||
640-679 | 3,788 | 289,718 | 120,930 | 14,430 | 7,646 | 436,512 | ||||||||||||||||||
680-719 | 7,299 | 511,686 | 229,819 | 22,310 | 13,956 | 785,070 | ||||||||||||||||||
720-759 | 7,402 | 749,367 | 319,806 | 25,554 | 14,540 | 1,116,669 | ||||||||||||||||||
>=760 | 13,709 | 1,830,019 | 701,053 | 56,261 | 32,042 | 2,633,084 | ||||||||||||||||||
Grand Total | $ | 227,400 | $ | 3,739,217 | $ | 1,492,565 | $ | 142,443 | $ | 80,605 | $ | 5,682,230 |
(1) | Residential mortgages and home equity loans and lines of credit in the "N/A" range for LTV or FICO score primarily represent the balance on loans serviced by others, in run-off portfolios or for which a current LTV or FICO score is unavailable. |
(2) | Allowance model considers LTV for financing receivables in first lien position for the Company and CLTV for financing receivables in second lien position for the Company. |
Residential Mortgages(1)(3) | ||||||||||||||||||||||||||||||||
December 31, 2017 | N/A (2) | LTV<=70% | 70.01-80% | 80.01-90% | 90.01-100% | 100.01-110% | LTV>110% | Grand Total | ||||||||||||||||||||||||
FICO Score | (dollars in thousands) | |||||||||||||||||||||||||||||||
N/A(2) | $ | 372,116 | $ | 6,759 | $ | 1,214 | $ | — | $ | — | $ | — | $ | — | $ | 380,089 | ||||||||||||||||
<600 | 21 | 220,737 | 55,108 | 35,617 | 23,834 | 2,505 | 6,020 | 343,842 | ||||||||||||||||||||||||
600-639 | 45 | 155,920 | 42,420 | 35,009 | 34,331 | 2,696 | 6,259 | 276,680 | ||||||||||||||||||||||||
640-679 | 37 | 320,248 | 94,601 | 90,708 | 86,740 | 3,011 | 2,641 | 597,986 | ||||||||||||||||||||||||
680-719 | 98 | 554,058 | 236,602 | 136,980 | 147,754 | 3,955 | 10,317 | 1,089,764 | ||||||||||||||||||||||||
720-759 | 92 | 952,532 | 480,900 | 178,876 | 183,527 | 4,760 | 8,600 | 1,809,287 | ||||||||||||||||||||||||
>=760 | 588 | 3,019,514 | 1,066,919 | 263,541 | 187,713 | 8,418 | 12,594 | 4,559,287 | ||||||||||||||||||||||||
Grand Total | $ | 372,997 | $ | 5,229,768 | $ | 1,977,764 | $ | 740,731 | $ | 663,899 | $ | 25,345 | $ | 46,431 | $ | 9,056,935 |
(1) | Includes LHFS. |
(2) | Residential mortgages and home equity loans and lines of credit in the "N/A" range for LTV or FICO score primarily represent the balance on loans serviced by others, in run-off portfolios or for which a current LTV or FICO score is unavailable. |
(3) | Allowance model considers LTV for financing receivables in first lien position for the Company and CLTV for financing receivables in second lien position for the Company. |
Home Equity Loans and Lines of Credit(2) | ||||||||||||||||||||||||
December 31, 2017 | N/A(1) | LTV<=70% | 70.01-90% | 90.01-110% | LTV>110% | Grand Total | ||||||||||||||||||
FICO Score | (dollars in thousands) | |||||||||||||||||||||||
N/A(1) | $ | 154,690 | $ | 536 | $ | 238 | $ | — | $ | — | $ | 155,464 | ||||||||||||
<600 | 8,064 | 190,657 | 64,554 | 16,634 | 22,954 | 302,863 | ||||||||||||||||||
600-639 | 6,276 | 158,461 | 61,250 | 9,236 | 9,102 | 244,325 | ||||||||||||||||||
640-679 | 6,745 | 297,003 | 127,347 | 19,465 | 14,058 | 464,618 | ||||||||||||||||||
680-719 | 8,875 | 500,234 | 258,284 | 24,675 | 20,261 | 812,329 | ||||||||||||||||||
720-759 | 8,587 | 724,831 | 332,508 | 30,526 | 19,119 | 1,115,571 | ||||||||||||||||||
>=760 | 17,499 | 1,917,373 | 768,905 | 73,573 | 35,213 | 2,812,563 | ||||||||||||||||||
Grand Total | $ | 210,736 | $ | 3,789,095 | $ | 1,613,086 | $ | 174,109 | $ | 120,707 | $ | 5,907,733 |
(1) | Residential mortgages and home equity loans and lines of credit in the "N/A" range for LTV or FICO score primarily represent the balance on loans serviced by others, in run-off portfolios or for which a current LTV or FICO score is unavailable. |
(2) | Allowance model considers LTV for financing receivables in first lien position for the Company and CLTV for financing receivables in second lien position for the Company. |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Performing | $ | 5,809,300 | $ | 5,824,304 | ||||
Non-performing | 804,006 | 982,868 | ||||||
Total (1) | $ | 6,613,306 | $ | 6,807,172 |
Three-Month Period Ended June 30, 2018 | |||||||||||||||||||||||
Number of Contracts | Pre-TDR Recorded Investment(1) | Term Extension | Rate Reduction | Principal Forbearance | Other(4) | Post-TDR Recorded Investment(2) | |||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Commercial: | |||||||||||||||||||||||
CRE | 24 | $ | 12,384 | $ | 347 | $ | (1,771 | ) | $ | 1,313 | $ | (893 | ) | $ | 11,380 | ||||||||
Commercial and industrial | 68 | 2,111 | (1 | ) | — | — | (2 | ) | 2,108 | ||||||||||||||
Consumer: | |||||||||||||||||||||||
Residential mortgages(3) | 54 | 8,403 | — | — | — | (9 | ) | 8,394 | |||||||||||||||
Home equity loans and lines of credit | 44 | 2,840 | 13 | 36 | — | (24 | ) | 2,865 | |||||||||||||||
RICs and auto loans - originated | 41,833 | 704,222 | (920 | ) | — | — | (8 | ) | 703,294 | ||||||||||||||
RICs - purchased | 1,223 | 7,915 | (27 | ) | — | — | — | 7,888 | |||||||||||||||
Personal unsecured loans | 3,906 | 6,697 | — | — | — | (199 | ) | 6,498 | |||||||||||||||
Other consumer | 4 | 215 | — | — | — | (1 | ) | 214 | |||||||||||||||
Total | 47,156 | $ | 744,787 | $ | (588 | ) | $ | (1,735 | ) | $ | 1,313 | $ | (1,136 | ) | $ | 742,641 | |||||||
Six-Month Period Ended June 30, 2018 | |||||||||||||||||||||||
Number of Contracts | Pre-TDR Recorded Investment(1) | Term Extension | Rate Reduction | Principal Forbearance | Other(4) | Post-TDR Recorded Investment(2) | |||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Commercial: | |||||||||||||||||||||||
CRE | 51 | $ | 46,892 | $ | 336 | $ | (1,771 | ) | $ | 1,283 | $ | (1,994 | ) | $ | 44,746 | ||||||||
Commercial and industrial | 149 | 5,895 | (4 | ) | — | — | (133 | ) | 5,758 | ||||||||||||||
Consumer: | |||||||||||||||||||||||
Residential mortgages(3) | 115 | 18,330 | — | — | — | (729 | ) | 17,601 | |||||||||||||||
Home equity loans and lines of credit | 138 | 8,944 | 13 | 36 | — | (256 | ) | 8,737 | |||||||||||||||
RICs and auto loans - originated | 74,783 | 1,271,621 | (1,489 | ) | — | — | (80 | ) | 1,270,052 | ||||||||||||||
RICs - purchased | 2,842 | 20,239 | (76 | ) | — | — | (22 | ) | 20,141 | ||||||||||||||
Personal unsecured loans | 7,568 | 13,038 | — | — | — | (284 | ) | 12,754 | |||||||||||||||
Other consumer | 7 | 224 | — | — | — | (5 | ) | 219 | |||||||||||||||
Total | 85,653 | $ | 1,385,183 | $ | (1,220 | ) | $ | (1,735 | ) | $ | 1,283 | $ | (3,503 | ) | $ | 1,380,008 |
Three-Month Period Ended June 30, 2017 | |||||||||||||||||||||||
Number of Contracts | Pre-TDR Recorded Investment(1) | Term Extension | Rate Reduction | Principal Forbearance | Other(4) | Post-TDR Recorded Investment(2) | |||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Commercial: | |||||||||||||||||||||||
CRE | 31 | $ | 129,322 | $ | (14,269 | ) | $ | 127 | $ | (13,482 | ) | $ | (669 | ) | $ | 101,029 | |||||||
Commercial and industrial | 145 | 4,373 | (3 | ) | — | — | (4 | ) | 4,366 | ||||||||||||||
Consumer: | |||||||||||||||||||||||
Residential mortgages(3) | 60 | 12,981 | 6 | — | — | 116 | 13,103 | ||||||||||||||||
Home equity loans and lines of credit | 17 | 1,411 | — | — | — | 417 | 1,828 | ||||||||||||||||
RICs and auto loans - originated | 45,843 | 797,572 | (787 | ) | — | — | (40 | ) | 796,745 | ||||||||||||||
RICs - purchased | 24 | 101 | (1 | ) | — | — | — | 100 | |||||||||||||||
Personal unsecured loans | 3,572 | 6,038 | — | — | — | (68 | ) | 5,970 | |||||||||||||||
Other consumer | 48 | 1,421 | — | — | — | 1 | 1,422 | ||||||||||||||||
Total | 49,740 | $ | 953,219 | $ | (15,054 | ) | $ | 127 | $ | (13,482 | ) | $ | (247 | ) | $ | 924,563 | |||||||
Six-Month Period Ended June 30, 2017 | |||||||||||||||||||||||
Number of Contracts | Pre-TDR Recorded Investment(1) | Term Extension | Rate Reduction | Principal Forbearance | Other(4) | Post-TDR Recorded Investment(2) | |||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Commercial: | |||||||||||||||||||||||
CRE | 55 | $ | 159,323 | $ | (14,271 | ) | $ | 127 | $ | (13,481 | ) | $ | (329 | ) | $ | 131,369 | |||||||
Commercial and industrial | 387 | 12,407 | (7 | ) | — | — | (4 | ) | 12,396 | ||||||||||||||
Consumer: | |||||||||||||||||||||||
Residential mortgages(3) | 149 | 28,974 | 6 | 133 | — | (200 | ) | 28,913 | |||||||||||||||
Home equity loans and lines of credit | 36 | 2,843 | — | — | — | 538 | 3,381 | ||||||||||||||||
RICs and auto loans - originated | 96,753 | 1,704,171 | (1,721 | ) | — | — | (147 | ) | 1,702,303 | ||||||||||||||
RICs - purchased | 79 | 390 | (6 | ) | — | — | (2 | ) | 382 | ||||||||||||||
Personal unsecured loans | 7,890 | 13,140 | — | — | — | (113 | ) | 13,027 | |||||||||||||||
Other consumer | 107 | 3,539 | — | — | — | — | 3,539 | ||||||||||||||||
Total | 105,456 | $ | 1,924,787 | $ | (15,999 | ) | $ | 260 | $ | (13,481 | ) | $ | (257 | ) | $ | 1,895,310 |
(2) | Post-TDR modification outstanding recorded investment amount is the month-end balance for the month in which the modification occurred. |
(3) | The post-TDR modification outstanding recorded investment amounts for residential mortgages exclude interest reserves. |
(4) | Other modifications may include modifications such as interest rate reductions, fee waivers, or capitalization of fees. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | ||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||||
Number of Contracts | Recorded Investment(1) | Number of Contracts | Recorded Investment(1) | Number of Contracts | Recorded Investment(1) | Number of Contracts | Recorded Investment(1) | ||||||||||||||||||||
(dollars in thousands) | (dollars in thousands) | ||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||
CRE | 2 | $ | 309 | 3 | $ | 217 | 4 | $ | 593 | 5 | $ | 439 | |||||||||||||||
Commercial and industrial | 42 | 1,275 | 45 | 1,699 | 94 | 2,795 | 102 | 3,632 | |||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||
Residential mortgages | 32 | 3,967 | 67 | 10,306 | 96 | 12,835 | 120 | 15,065 | |||||||||||||||||||
Home equity loans and lines of credit | 13 | 608 | 2 | 37 | 20 | 1,159 | 4 | 210 | |||||||||||||||||||
RICs and auto loans | 8,786 | 145,373 | 10,940 | 193,280 | 20,808 | 347,042 | 23,221 | 407,282 | |||||||||||||||||||
Personal Unsecured loans | 57 | 566 | 1,013 | 2,522 | 2,381 | 3,809 | 1,936 | 4,740 | |||||||||||||||||||
Other consumer | 1 | 5 | 11 | 158 | 2 | 15 | 22 | 276 | |||||||||||||||||||
Total | 8,933 | $ | 152,103 | 12,081 | $ | 208,219 | 23,405 | $ | 368,248 | 25,410 | $ | 431,644 |
(1) | The recorded investment represents the period-end balance at June 30, 2018 and 2017. Does not include Chapter 7 bankruptcy TDRs. |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Leased vehicles | $ | 15,885,554 | $ | 14,751,568 | ||||
Origination fees and other costs | 45,685 | 27,246 | ||||||
Manufacturer subvention payments | (1,152,531 | ) | (1,047,113 | ) | ||||
Leased vehicles, gross | 14,778,708 | 13,731,701 | ||||||
Less: accumulated depreciation | (3,051,322 | ) | (3,333,125 | ) | ||||
Leased vehicles, net | 11,727,386 | 10,398,576 | ||||||
Commercial equipment vehicles and aircraft, gross | 133,142 | 93,981 | ||||||
Less: accumulated depreciation | (26,306 | ) | (18,249 | ) | ||||
Commercial equipment vehicles and aircraft, net | 106,836 | 75,732 | ||||||
Total operating lease assets, net | $ | 11,834,222 | $ | 10,474,308 |
2018 | $ | 1,065,036 | ||
2019 | 1,676,115 | |||
2020 | 991,768 | |||
2021 | 175,753 | |||
2022 | 10,655 | |||
Thereafter | 16,679 | |||
Total | $ | 3,936,006 |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Assets | ||||||||
Restricted cash | $ | 1,657,399 | $ | 1,995,557 | ||||
Loans(1)(2) | 23,095,829 | 22,712,864 | ||||||
Operating lease assets, net | 11,729,482 | 10,160,327 | ||||||
Various other assets | 701,267 | 733,123 | ||||||
Total Assets | $ | 37,183,977 | $ | 35,601,871 | ||||
Liabilities | ||||||||
Notes payable(2) | $ | 29,515,015 | $ | 28,469,999 | ||||
Various other liabilities | 221,065 | 197,969 | ||||||
Total Liabilities | $ | 29,736,080 | $ | 28,667,968 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | |||||||||||||||
(in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Assets securitized | $ | 6,511,953 | $ | 4,750,103 | $ | 13,752,897 | $ | 12,396,728 | ||||||||
Net proceeds from new securitizations (1) | $ | 4,581,874 | $ | 3,485,091 | $ | 8,058,196 | $ | 9,061,892 | ||||||||
Net proceeds from sale of retained bonds | 382,022 | 157,763 | 593,632 | 273,733 | ||||||||||||
Cash received for servicing fees (2) | 213,900 | 215,994 | 429,690 | 424,917 | ||||||||||||
Net distributions from Trusts (2) | 780,834 | 729,557 | 1,325,986 | 1,407,786 | ||||||||||||
Total cash received from Trusts | $ | 5,958,630 | $ | 4,588,405 | $ | 10,407,504 | $ | 11,168,328 |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Spain Private Auto Issuing Note ("SPAIN") trust | $ | 3,967,665 | $ | 2,024,016 | ||||
Total serviced for related parties | 3,967,665 | 2,024,016 | ||||||
Chrysler Capital securitizations | 960,057 | 1,404,232 | ||||||
Total serviced for third parties | 960,057 | 1,404,232 | ||||||
Total serviced for other portfolio | $ | 4,927,722 | $ | 3,428,248 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | |||||||||||||||
(in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Assets securitized (1) | $ | 1,156,060 | $ | 536,309 | $ | 2,631,313 | $ | 1,236,331 | ||||||||
Net proceeds from new securitizations | $ | 1,160,119 | $ | 538,478 | $ | 2,634,919 | $ | 1,240,797 | ||||||||
Cash received for servicing fees | 12,616 | 11,970 | 20,694 | 13,368 | ||||||||||||
Total cash received from Trusts | $ | 1,172,735 | $ | 550,448 | $ | 2,655,613 | $ | 1,254,165 |
(in thousands) | Consumer and Business Banking | Commercial Banking | CIB | SC | Total | |||||||||||||||
Goodwill | $ | 1,880,304 | $ | 1,412,995 | $ | 131,130 | $ | 1,019,960 | $ | 4,444,389 |
June 30, 2018 | December 31, 2017 | |||||||||||||||
(in thousands) | Net Carrying Amount | Accumulated Amortization | Net Carrying Amount | Accumulated Amortization | ||||||||||||
Intangibles subject to amortization: | ||||||||||||||||
Dealer networks | $ | 406,804 | $ | (173,196 | ) | $ | 426,411 | $ | (153,589 | ) | ||||||
Chrysler relationship | 72,500 | (66,250 | ) | 80,000 | (58,750 | ) | ||||||||||
Trade name | 15,300 | (2,700 | ) | 15,900 | (2,100 | ) | ||||||||||
Other intangibles | 10,590 | (58,745 | ) | 13,442 | (56,021 | ) | ||||||||||
Total intangibles subject to amortization | $ | 505,194 | $ | (300,891 | ) | $ | 535,753 | $ | (270,460 | ) |
Year | Calendar Year Amount | Recorded To Date | Remaining Amount To Record | |||||||||
(in thousands) | ||||||||||||
2018 | $ | 60,649 | $ | 30,576 | $ | 30,073 | ||||||
2019 | 58,978 | — | 58,978 | |||||||||
2020 | 58,645 | — | 58,645 | |||||||||
2021 | 39,892 | — | 39,892 | |||||||||
2022 | 39,892 | — | 39,892 | |||||||||
Thereafter | 277,714 | — | 277,714 |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Income tax receivables | $ | 301,206 | $ | 292,220 | ||||
Derivative assets at fair value | 645,608 | 448,977 | ||||||
Other repossessed assets | 148,641 | 212,882 | ||||||
MSRs | 161,294 | 149,197 | ||||||
Prepaid expenses | 156,800 | 172,547 | ||||||
OREO | 118,503 | 130,777 | ||||||
Deferred tax asset, net | 761,171 | 771,652 | ||||||
Accrued interest receivable | 535,773 | 563,607 | ||||||
Equity method investments | 204,116 | 194,434 | ||||||
Miscellaneous assets and receivables | 897,139 | 696,134 | ||||||
Total other assets | $ | 3,930,251 | $ | 3,632,427 |
Three-Month Period Ended | Six-Month Period Ended | |||||||||||||||
(in thousands) | June 30, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | ||||||||||||
Fair value at beginning of period(1) | $ | 160,130 | $ | 149,455 | $ | 145,993 | $ | 146,589 | ||||||||
Mortgage servicing assets recognized | 2,841 | 2,866 | 5,597 | 8,597 | ||||||||||||
Principal reductions | (3,227 | ) | (5,037 | ) | (6,889 | ) | (9,358 | ) | ||||||||
Change in fair value due to valuation assumptions | (1,274 | ) | (1,193 | ) | 13,769 | 263 | ||||||||||
Fair value at end of period(1) | $ | 158,470 | $ | 146,091 | $ | 158,470 | $ | 146,091 |
(1) | The Company had total MSRs of $161.3 million and $149.2 million as of June 30, 2018 and December 31, 2017, respectively. The Company has elected to account for the majority of its MSR balance using the FVO, while the remainder of the MSRs are accounted for using the lower of cost or market and are not presented within this table. |
June 30, 2018 | December 31, 2017 | |||||||||||||
(dollars in thousands) | Balance | Percent of total deposits | Balance | Percent of total deposits | ||||||||||
Interest-bearing demand deposits | $ | 8,439,484 | 13.7 | % | $ | 8,784,597 | 14.4 | % | ||||||
Non-interest-bearing demand deposits | 15,430,518 | 25.1 | % | 15,402,235 | 25.3 | % | ||||||||
Savings | 5,914,126 | 9.6 | % | 5,903,897 | 9.7 | % | ||||||||
Customer repurchase accounts | 580,451 | 0.9 | % | 802,119 | 1.4 | % | ||||||||
Money market | 25,392,936 | 41.3 | % | 24,530,661 | 40.3 | % | ||||||||
CDs | 5,799,033 | 9.4 | % | 5,407,594 | 8.9 | % | ||||||||
Total Deposits (1) | $ | 61,556,548 | 100.0 | % | $ | 60,831,103 | 100.0 | % |
(1) | Includes foreign deposits, as defined by the FRB, of $8.6 billion and $9.1 billion at June 30, 2018 and December 31, 2017, respectively. |
June 30, 2018 | December 31, 2017 | |||||||||||||
(dollars in thousands) | Balance | Effective Rate | Balance | Effective Rate | ||||||||||
Parent Company | ||||||||||||||
3.45% senior notes, due August 2018 | $ | 181,305 | 3.62 | % | $ | 244,317 | 3.62 | % | ||||||
2.70% senior notes, due May 2019 | 662,531 | 2.82 | % | 998,349 | 2.82 | % | ||||||||
2.65% senior notes, due April 2020 | 997,037 | 2.82 | % | 996,238 | 2.82 | % | ||||||||
3.70% senior notes, due March 2022 | 1,440,053 | 3.74 | % | 1,440,044 | 3.74 | % | ||||||||
3.40% senior notes, due January 2023 | 994,241 | 3.54 | % | 993,662 | 3.54 | % | ||||||||
4.50% senior notes, due July 2025 | 1,095,705 | 4.56 | % | 1,095,449 | 4.56 | % | ||||||||
4.40% senior notes, due July 2027 | 1,049,793 | 4.40 | % | 1,049,787 | 4.40 | % | ||||||||
Junior subordinated debentures - Sovereign Capital Trust IX, due July 2036 | 149,477 | 4.13 | % | 149,462 | 3.14 | % | ||||||||
Common securities - Sovereign Capital Trust IX | 4,640 | 4.13 | % | 4,640 | 3.14 | % | ||||||||
Senior notes, due July 2019 (1) | 388,698 | 2.98 | % | 388,565 | 2.31 | % | ||||||||
Senior notes, due September 2019 (1) | 370,923 | 2.89 | % | 370,754 | 2.34 | % | ||||||||
Senior notes, due January 2020 (1) | 302,607 | 2.98 | % | 302,494 | 2.40 | % | ||||||||
Senior notes, due September 2020 (2) | 113,030 | 3.27 | % | 115,804 | 3.32 | % | ||||||||
Senior notes, due June 2022(1) | 427,838 | 3.67 | % | — | — | % | ||||||||
Subsidiaries | ||||||||||||||
2.00% subordinated debt, maturing through 2042 | 40,761 | 2.00 | % | 40,842 | 2.00 | % | ||||||||
Short-term borrowings, due within one year, maturing through 2018 | 4,857 | 0.67 | % | 24,000 | 1.38 | % | ||||||||
Total due to others overnight, due within one year, due July 2018 | 23,600 | 1.90 | % | 10,000 | 1.38 | % | ||||||||
Short-term borrowings, due within one year, maturing July 2018 | 21,357 | 0.25 | % | 37,546 | 0.25 | % | ||||||||
Short-term borrowings, due within one year, maturing through 2018 | — | % | 7,123 | 0.83 | % | |||||||||
Total Parent Company and subsidiaries' borrowings and other debt obligations | $ | 8,268,453 | 3.59 | % | $ | 8,269,076 | 3.45 | % |
June 30, 2018 | December 31, 2017 | |||||||||||||
(dollars in thousands) | Balance | Effective Rate | Balance | Effective Rate | ||||||||||
8.750% subordinated debentures, due May 2018 | $ | — | — | % | $ | 192,019 | 8.92 | % | ||||||
Subordinated term loan, due February 2019 | 104,912 | 7.63 | % | 111,883 | 7.12 | % | ||||||||
FHLB advances, maturing through July 2019 | 1,300,000 | 2.34 | % | 1,950,000 | 1.53 | % | ||||||||
Securities sold under repurchase agreements | — | — | % | 150,000 | 1.56 | % | ||||||||
Real estate investment trust preferred, due May 2020 | 144,877 | 13.21 | % | 144,167 | 13.35 | % | ||||||||
Subordinated term loan, due August 2022 | 27,212 | 9.29 | % | 27,911 | 8.89 | % | ||||||||
Total Bank borrowings and other debt obligations | $ | 1,577,001 | 3.81 | % | $ | 2,575,980 | 3.07 | % |
June 30, 2018 | |||||||||||||||||||
(dollars in thousands) | Balance | Committed Amount | Effective Rate | Assets Pledged | Restricted Cash Pledged | ||||||||||||||
Warehouse line, maturing on various dates(1) | $ | 518,345 | $ | 1,250,000 | 3.36 | % | $ | 780,594 | $ | 5,068 | |||||||||
Warehouse line, due November 2019 | 78,620 | 500,000 | 5.06 | % | 89,182 | 411 | |||||||||||||
Warehouse line, due August 2019(2) | 1,832,943 | 3,900,000 | 3.86 | % | 2,310,677 | 10,261 | |||||||||||||
Warehouse line, due October 2019 | 364,777 | 1,800,000 | 4.44 | % | 529,183 | 180 | |||||||||||||
Warehouse line, due October 2019 | 217,465 | 400,000 | 3.45 | % | 328,840 | 158 | |||||||||||||
Warehouse line, due August 2019 | 287,484 | 500,000 | 3.56 | % | 410,567 | 24,525 | |||||||||||||
Warehouse line, due November 2020 | 417,499 | 1,000,000 | 3.17 | % | 632,984 | 8 | |||||||||||||
Warehouse line, due October 2018 | 214,500 | 300,000 | 3.66 | % | 248,608 | 333 | |||||||||||||
Warehouse line, due December 2018 | 115,100 | 300,000 | 4.01 | % | 181,621 | 855 | |||||||||||||
Repurchase facility, maturing on various dates(3)(4) | 179,934 | 179,934 | 3.78 | % | 259,860 | 17,818 | |||||||||||||
Repurchase facility, due July 2018(4)(5) | 92,167 | 92,167 | 3.51 | % | 129,440 | — | |||||||||||||
Repurchase facility, due September 2018(4) | 68,682 | 68,682 | 3.56 | % | 92,358 | — | |||||||||||||
Repurchase facility, due December 2018(4) | 115,307 | 115,307 | 3.58 | % | 156,202 | — | |||||||||||||
Line of credit with related party, due December 2018(6) | — | 1,000,000 | 3.09 | % | — | — | |||||||||||||
Line of credit with related party, due December 2018(6) | 122,200 | 750,000 | 4.60 | % | 129,268 | 538 | |||||||||||||
Total SC revolving credit facilities | $ | 4,625,023 | $ | 12,156,090 | 3.76 | % | $ | 6,279,384 | $ | 60,155 |
(1) | As of June 30, 2018, one-half of the outstanding balance on this facility matures in March 2019 and the remaining balance matures in March 2020. |
(2) | This line is held exclusively for financing of Chrysler Capital leases. |
(4) | These repurchase facilities are collateralized by securitization notes payable retained by SC. No portion of these facilities is unsecured. These facilities have rolling maturities of up to one year. As the borrower, SC is exposed to liquidity risk due to changes in the market value of retrained securities pledged. In some instances, SC places or receives cash collateral with counterparties under collateral arrangements associated with SC's repurchase agreements. |
(6) | These lines are also collateralized by securitization notes payable and residuals retained by SC. As of June 30, 2018, no portion of these facilities was unsecured. |
December 31, 2017 | |||||||||||||||||||
(dollars in thousands) | Balance | Committed Amount | Effective Rate | Assets Pledged | Restricted Cash Pledged | ||||||||||||||
Warehouse line, maturing on various dates | $ | 339,145 | $ | 1,250,000 | 2.53 | % | $ | 461,353 | $ | 12,645 | |||||||||
Warehouse line, due November 2019 | 435,220 | 500,000 | 1.92 | % | 521,365 | 16,866 | |||||||||||||
Warehouse line, due August 2019 | 2,044,843 | 3,900,000 | 2.96 | % | 2,929,890 | 53,639 | |||||||||||||
Warehouse line, due October 2019 | 226,577 | 1,800,000 | 4.95 | % | 311,336 | 6,772 | |||||||||||||
Warehouse line, due October 2019 | 81,865 | 400,000 | 4.09 | % | 114,021 | 3,057 | |||||||||||||
Warehouse line, due January 2018 | 336,484 | 500,000 | 2.87 | % | 473,208 | — | |||||||||||||
Warehouse line, due November 2019 | 403,999 | 1,000,000 | 2.66 | % | 546,782 | 14,729 | |||||||||||||
Warehouse line, due October 2018 | 235,700 | 300,000 | 2.84 | % | 289,634 | 10,474 | |||||||||||||
Warehouse line, due December 2018 | — | 300,000 | 1.49 | % | — | — | |||||||||||||
Repurchase facility, maturing on various dates | 325,775 | 325,775 | 3.24 | % | 474,188 | 13,842 | |||||||||||||
Repurchase facility, due April 2018 | 202,311 | 202,311 | 2.67 | % | 264,120 | — | |||||||||||||
Repurchase facility, due March 2018 | 147,500 | 147,500 | 3.91 | % | 222,108 | — | |||||||||||||
Repurchase facility, due March 2018 | 68,897 | 68,897 | 3.04 | % | 95,762 | — | |||||||||||||
Line of credit with related party, due December 2018 | — | 1,000,000 | 3.09 | % | — | — | |||||||||||||
Line of credit with related party, due December 2018 | 750,000 | 750,000 | 1.33 | % | — | — | |||||||||||||
Total SC revolving credit facilities | $ | 5,598,316 | $ | 12,444,483 | 2.73 | % | $ | 6,703,767 | $ | 132,024 |
June 30, 2018 | ||||||||||||||||||
(dollars in thousands) | Balance | Initial Note Amounts Issued | Initial Weighted Average Interest Rate Range | Collateral(2) | Restricted Cash | |||||||||||||
SC public securitizations, maturing on various dates(1) | $ | 18,596,271 | $ | 39,882,682 | 1.16% - 3.53% | $ | 23,831,801 | $ | 1,588,592 | |||||||||
SC privately issued amortizing notes, maturing on various dates | 5,704,630 | 12,938,389 | 0.88% - 2.89% | 6,998,005 | 26,675 | |||||||||||||
Total SC secured structured financings | $ | 24,300,901 | $ | 52,821,071 | 0.88% - 3.53% | $ | 30,829,806 | $ | 1,615,267 |
December 31, 2017 | ||||||||||||||||||
(dollars in thousands) | Balance | Initial Note Amounts Issued | Initial Weighted Average Interest Rate Range | Collateral | Restricted Cash | |||||||||||||
SC public securitizations, maturing on various dates(1)(2) | $ | 14,995,304 | $ | 36,800,642 | 0.89% - 2.80% | $ | 19,873,621 | $ | 1,470,459 | |||||||||
SC privately issued amortizing notes, maturing on various dates(1) | 7,564,637 | 12,278,282 | 0.88% - 4.09% | 9,232,658 | 377,300 | |||||||||||||
Total SC secured structured financings | $ | 22,559,941 | $ | 49,078,924 | 0.88% - 4.09% | $ | 29,106,279 | $ | 1,847,759 |
Total Other Comprehensive Income/(Loss) | Total Accumulated Other Comprehensive (Loss)/Income | |||||||||||||||||||||||
Three-Month Period Ended June 30, 2018 | March 31, 2018 | June 30, 2018 | ||||||||||||||||||||||
(in thousands) | Pretax Activity | Tax Effect | Net Activity | Beginning Balance | Net Activity | Ending Balance | ||||||||||||||||||
Change in accumulated other comprehensive income on cash flow hedge derivative financial instruments | $ | (21,956 | ) | $ | 6,772 | $ | (15,184 | ) | ||||||||||||||||
Reclassification adjustment for net losses on cash flow hedge derivative financial instruments(1) | 15,332 | (4,887 | ) | 10,445 | ||||||||||||||||||||
Net unrealized (losses) on cash flow hedge derivative financial instruments | (6,624 | ) | 1,885 | (4,739 | ) | $ | (23,752 | ) | $ | (4,739 | ) | $ | (28,491 | ) | ||||||||||
Change in unrealized (losses) on investments in debt securities AFS | (46,198 | ) | 11,459 | (34,739 | ) | |||||||||||||||||||
Reclassification adjustment for net (gains) included in net income/(expense) on non-OTTI securities (2) | (419 | ) | 104 | (315 | ) | |||||||||||||||||||
Net unrealized (losses) on investments in debt securities AFS | (46,617 | ) | 11,563 | (35,054 | ) | (290,522 | ) | (35,054 | ) | (325,576 | ) | |||||||||||||
Pension and post-retirement actuarial gain(3) | 842 | (217 | ) | 625 | (56,007 | ) | 625 | (55,382 | ) | |||||||||||||||
As of June 30, 2018 | $ | (52,399 | ) | $ | 13,231 | $ | (39,168 | ) | $ | (370,281 | ) | $ | (39,168 | ) | $ | (409,449 | ) | |||||||
Total Other Comprehensive Income/(Loss) | Total Accumulated Other Comprehensive (Loss)/Income | |||||||||||||||||||||||
Six-Month Period Ended June 30, 2018 | December 31, 2017 | June 30, 2018 | ||||||||||||||||||||||
(in thousands) | Pretax Activity | Tax Effect | Net Activity | Beginning Balance | Net Activity | Ending Balance | ||||||||||||||||||
Change in accumulated other comprehensive income on cash flow hedge derivative financial instruments | $ | (33,417 | ) | $ | 2,018 | $ | (31,399 | ) | ||||||||||||||||
Reclassification adjustment for net losses on cash flow hedge derivative financial instruments(1) | 13,645 | (4,349 | ) | 9,296 | ||||||||||||||||||||
Net unrealized (losses) on cash flow hedge derivative financial instruments | (19,772 | ) | (2,331 | ) | (22,103 | ) | $ | (6,388 | ) | $ | (22,103 | ) | $ | (28,491 | ) | |||||||||
Change in unrealized (losses) on investments in debt securities AFS | (168,442 | ) | 22,246 | (146,196 | ) | |||||||||||||||||||
Reclassification adjustment for net losses included in net income/(expense) on non-OTTI securities (2) | 244 | (32 | ) | 212 | ||||||||||||||||||||
Net unrealized (losses) on investments in debt securities AFS | (168,198 | ) | 22,214 | (145,984 | ) | (140,498 | ) | (145,984 | ) | |||||||||||||||
Cumulative effect of adoption of new ASUs(4) | (39,094 | ) | ||||||||||||||||||||||
Net unrealized (losses) on investments in debt securities AFS - upon adoption | (185,078 | ) | (325,576 | ) | ||||||||||||||||||||
Pension and post-retirement actuarial gain(3) | 1,684 | (5,521 | ) | (3,837 | ) | (51,545 | ) | (3,837 | ) | (55,382 | ) | |||||||||||||
As of June 30, 2018 | $ | (186,286 | ) | $ | 14,362 | $ | (171,924 | ) | $ | (198,431 | ) | $ | (211,018 | ) | $ | (409,449 | ) |
(1) | Net gains/(losses) reclassified into Interest on borrowings and other debt obligations in the Condensed Consolidated Statements of Operations for settlements of interest rate swap contracts designated as cash flow hedges. |
(2) | Net (gains)/losses reclassified into Net gain on sale of investment securities sales in the Condensed Consolidated Statements of Operations for the sale of AFS securities. |
(3) | Included in the computation of net periodic pension costs. |
Total Other Comprehensive (Loss)/Income | Total Accumulated Other Comprehensive Loss | |||||||||||||||||||||||
Three-Month Period Ended June 30, 2017 | March 31, 2017 | June 30, 2017 | ||||||||||||||||||||||
(in thousands) | Pretax Activity | Tax Effect | Net Activity | Beginning Balance | Net Activity | Ending Balance | ||||||||||||||||||
Change in accumulated other comprehensive income on cash flow hedge derivative financial instruments | $ | 10,205 | $ | (596 | ) | $ | 9,609 | |||||||||||||||||
Reclassification adjustment for net (gains) on cash flow hedge derivative financial instruments(1) | (4,072 | ) | 986 | (3,086 | ) | |||||||||||||||||||
Net unrealized gains on cash flow hedge derivative financial instruments | 6,133 | 390 | 6,523 | $ | (9,212 | ) | $ | 6,523 | $ | (2,689 | ) | |||||||||||||
Change in unrealized gains on investment securities AFS | 36,480 | (14,369 | ) | 22,111 | ||||||||||||||||||||
Reclassification adjustment for net (gains) included in net income/(expense) on non-OTTI securities (2) | (11,125 | ) | 4,363 | (6,762 | ) | |||||||||||||||||||
Net unrealized gains on investment securities AFS | 25,355 | (10,006 | ) | 15,349 | (109,785 | ) | 15,349 | (94,436 | ) | |||||||||||||||
Pension and post-retirement actuarial gain(4) | 911 | (355 | ) | 556 | (55,244 | ) | 556 | (54,688 | ) | |||||||||||||||
As of June 30, 2017 | $ | 32,399 | $ | (9,971 | ) | $ | 22,428 | $ | (174,241 | ) | $ | 22,428 | $ | (151,813 | ) | |||||||||
Total Other Comprehensive Income/(Loss) | Total Accumulated Other Comprehensive (Loss)/Income | |||||||||||||||||||||||
Six-Month Period Ended June 30, 2017 | December 31, 2016 | June 30, 2017 | ||||||||||||||||||||||
(in thousands) | Pretax Activity | Tax Effect | Net Activity | Beginning Balance | Net Activity | Ending Balance | ||||||||||||||||||
Change in accumulated other comprehensive income on cash flow hedge derivative financial instruments | $ | 12,151 | $ | (3,430 | ) | $ | 8,721 | |||||||||||||||||
Reclassification adjustment for net (gains) on cash flow hedge derivative financial instruments(1) | (6,459 | ) | 1,774 | (4,685 | ) | |||||||||||||||||||
Net unrealized gains on cash flow hedge derivative financial instruments | 5,692 | (1,656 | ) | 4,036 | $ | (6,725 | ) | $ | 4,036 | $ | (2,689 | ) | ||||||||||||
Change in unrealized gains on investment securities AFS | 67,928 | (24,477 | ) | 43,451 | ||||||||||||||||||||
Reclassification adjustment for net (gains) included in net income/(expense) on non-OTTI securities (2) | (11,125 | ) | 3,992 | (7,133 | ) | |||||||||||||||||||
Net unrealized gains on investment securities AFS | 56,803 | (20,485 | ) | 36,318 | (130,754 | ) | 36,318 | (94,436 | ) | |||||||||||||||
Pension and post-retirement actuarial gain(4) | 1,824 | (783 | ) | 1,041 | (55,729 | ) | 1,041 | (54,688 | ) | |||||||||||||||
As of June 30, 2017 | $ | 64,319 | $ | (22,924 | ) | $ | 41,395 | $ | (193,208 | ) | $ | 41,395 | $ | (151,813 | ) |
(1) | Net gains/(losses) reclassified into Interest on borrowings and other debt obligations in the Condensed Consolidated Statements of Operations for settlements of interest rate swap contracts designated as cash flow hedges. |
(2) | Net (gains)/losses reclassified into Net gain on sale of investment securities sales in the Condensed Consolidated Statements of Operations for the sale of AFS securities. |
(3) | Unrealized losses/(gains) previously recognized in accumulated other comprehensive income on securities for which OTTI was recognized during the period. See further discussion in Note 3 to the Condensed Consolidated Financial Statements. |
(4) | Included in the computation of net periodic pension costs. |
(dollars in thousands) | Notional Amount | Asset | Liability | Weighted Average Receive Rate | Weighted Average Pay Rate | Weighted Average Life (Years) | ||||||||||||||
June 30, 2018 | ||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||
Pay fixed — receive variable interest rate swaps | $ | 4,446,114 | $ | 74,833 | $ | 1,794 | 1.44 | % | 2.30 | % | 1.81 | |||||||||
Pay variable - receive fixed interest rate swaps | 4,000,000 | — | 127,205 | 1.41 | % | 2.02 | % | 2.53 | ||||||||||||
Interest rate floor | 1,600,000 | 6,133 | — | — | % | — | % | 2.20 | ||||||||||||
Total | $ | 10,046,114 | $ | 80,966 | $ | 128,999 | 1.20 | % | 1.82 | % | 2.16 | |||||||||
December 31, 2017 | ||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||
Pay fixed — receive variable interest rate swaps | $ | 5,183,511 | $ | 46,422 | $ | 4,458 | 0.05 | % | 0.14 | % | 2.12 | |||||||||
Pay variable - receive fixed interest rate swaps | 4,000,000 | — | 80,453 | 1.41 | % | 1.42 | % | 3.02 | ||||||||||||
Interest rate floor | 1,000,000 | 3,020 | — | — | % | — | % | 2.64 | ||||||||||||
Total | $ | 10,183,511 | $ | 49,442 | $ | 84,911 | 0.58 | % | 0.63 | % | 2.53 |
Notional | Asset derivatives Fair value | Liability derivatives Fair value | ||||||||||||||||||||||
(in thousands) | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | ||||||||||||||||||
Mortgage banking derivatives: | ||||||||||||||||||||||||
Forward commitments to sell loans | $ | 406,350 | $ | 311,852 | $ | — | $ | 3 | $ | 1,209 | $ | 459 | ||||||||||||
Interest rate lock commitments | 188,088 | 126,194 | 2,384 | 2,105 | — | — | ||||||||||||||||||
Mortgage servicing | 420,000 | 330,000 | 2,887 | 193 | 15,214 | 2,092 | ||||||||||||||||||
Total mortgage banking risk management | 1,014,438 | 768,046 | 5,271 | 2,301 | 16,423 | 2,551 | ||||||||||||||||||
Customer related derivatives: | ||||||||||||||||||||||||
Swaps receive fixed | 10,638,573 | 9,328,079 | 30,822 | 72,912 | 189,772 | 70,348 | ||||||||||||||||||
Swaps pay fixed | 10,935,332 | 9,576,893 | 247,558 | 110,109 | 23,340 | 51,380 | ||||||||||||||||||
Other | 2,018,242 | 1,834,962 | 14,487 | 19,971 | 12,523 | 18,308 | ||||||||||||||||||
Total customer related derivatives | 23,592,147 | 20,739,934 | 292,867 | 202,992 | 225,635 | 140,036 | ||||||||||||||||||
Other derivative activities: | ||||||||||||||||||||||||
Foreign exchange contracts | 3,524,342 | 2,764,999 | 50,331 | 24,932 | 38,434 | 25,521 | ||||||||||||||||||
Interest rate swap agreements | 2,625,796 | 1,749,349 | 19,596 | 9,596 | 1,243 | 1,631 | ||||||||||||||||||
Interest rate cap agreements | 9,225,194 | 10,932,707 | 199,053 | 135,942 | — | 32,109 | ||||||||||||||||||
Options for interest rate cap agreements | 9,207,853 | 10,906,081 | — | 32,165 | 199,131 | 135,824 | ||||||||||||||||||
Other | 967,997 | 824,786 | 5,321 | 5,874 | 8,024 | 5,228 | ||||||||||||||||||
Total | $ | 50,157,767 | $ | 48,685,902 | $ | 572,439 | $ | 413,802 | $ | 488,890 | $ | 342,900 |
(in thousands) | Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | ||||||||||||||
Derivative Activity(1) | Line Item | 2018 | 2017 | 2018 | 2017 | |||||||||||
Fair value hedges: | ||||||||||||||||
Interest rate swaps | Net Interest Income | — | (2,162 | ) | — | (2,162 | ) | |||||||||
Cash flow hedges: | ||||||||||||||||
Pay fixed-receive variable interest rate swaps | Interest expense on borrowings | 7,925 | (4,084 | ) | $ | 10,689 | $ | (6,471 | ) | |||||||
Pay variable receive-fixed interest rate swap | Interest income on loans | (5,023 | ) | (3,506 | ) | (7,043 | ) | (6,287 | ) | |||||||
Other derivative activities: | ||||||||||||||||
Forward commitments to sell loans | Miscellaneous income, net | (239 | ) | 3,625 | (753 | ) | (7,315 | ) | ||||||||
Interest rate lock commitments | Miscellaneous income, net | 131 | (1,414 | ) | 279 | 580 | ||||||||||
Mortgage servicing | Miscellaneous income, net | (3,532 | ) | 1,503 | (10,427 | ) | 2,000 | |||||||||
Customer related derivatives | Miscellaneous income, net | 5,360 | (1,124 | ) | 7,946 | (2,737 | ) | |||||||||
Foreign exchange | Miscellaneous income, net | 4,520 | 886 | 5,808 | 3,146 | |||||||||||
Interest rate swaps, caps, and options | Miscellaneous income, net | 193 | 4 | 10,232 | 1,511 | |||||||||||
Interest expense | — | (1,068 | ) | — | 3,662 | |||||||||||
Total return settlement | Other administrative expenses | — | — | — | (505 | ) | ||||||||||
Other | Miscellaneous income, net | (392 | ) | 557 | (3,545 | ) | (944 | ) |
(1) | Gains are disclosed as positive numbers while losses are shown as a negative number regardless of the line item being affected. |
Offsetting of Financial Assets | ||||||||||||||||||||||||
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||||
(in thousands) | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Condensed Consolidated Balance Sheet | Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheet | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
June 30, 2018 | ||||||||||||||||||||||||
Cash flow hedges | $ | 80,966 | $ | — | $ | 80,966 | $ | — | $ | 43,921 | $ | 37,045 | ||||||||||||
Other derivative activities(1) | 570,055 | 7,739 | 562,316 | 1,987 | 145,171 | 415,158 | ||||||||||||||||||
Total derivatives subject to a master netting arrangement or similar arrangement | 651,021 | 7,739 | 643,282 | 1,987 | 189,092 | 452,203 | ||||||||||||||||||
Total derivatives not subject to a master netting arrangement or similar arrangement(2) | 2,384 | — | 2,384 | — | — | 2,384 | ||||||||||||||||||
Total Derivative Assets | $ | 653,405 | $ | 7,739 | $ | 645,666 | $ | 1,987 | $ | 189,092 | $ | 454,587 | ||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
Cash flow hedges | $ | 49,442 | $ | — | $ | 49,442 | $ | — | $ | 3,076 | $ | 46,366 | ||||||||||||
Other derivative activities(1) | 411,697 | 6,731 | 404,966 | 2,021 | 77,975 | 324,970 | ||||||||||||||||||
Total derivatives subject to a master netting arrangement or similar arrangement | 461,139 | 6,731 | 454,408 | 2,021 | 81,051 | 371,336 | ||||||||||||||||||
Total derivatives not subject to a master netting arrangement or similar arrangement(2) | 2,105 | — | 2,105 | — | — | 2,105 | ||||||||||||||||||
Total Derivative Assets | $ | 463,244 | $ | 6,731 | $ | 456,513 | $ | 2,021 | $ | 81,051 | $ | 373,441 |
(1) | Includes customer-related and other derivatives. |
(2) | Includes mortgage banking derivatives. |
Offsetting of Financial Liabilities | ||||||||||||||||||||||||
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||||
(in thousands) | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Condensed Consolidated Balance Sheet | Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet | Financial Instruments | Cash Collateral Pledged | Net Amount | ||||||||||||||||||
June 30, 2018 | ||||||||||||||||||||||||
Cash flow hedges | $ | 128,999 | $ | — | $ | 128,999 | $ | — | $ | — | $ | 128,999 | ||||||||||||
Other derivative activities(1) | 487,681 | 20,187 | 467,494 | — | 353,640 | 113,854 | ||||||||||||||||||
Total derivatives subject to a master netting arrangement or similar arrangement | 616,680 | 20,187 | 596,493 | — | 353,640 | 242,853 | ||||||||||||||||||
Total derivatives not subject to a master netting arrangement or similar arrangement(2) | 1,209 | — | 1,209 | — | — | 1,209 | ||||||||||||||||||
Total Derivative Liabilities | $ | 617,889 | $ | 20,187 | $ | 597,702 | $ | — | $ | 353,640 | $ | 244,062 | ||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
Cash flow hedges | $ | 84,911 | $ | — | $ | 84,911 | $ | — | $ | 622 | $ | 84,289 | ||||||||||||
Other derivative activities(1) | 342,752 | 16,236 | 326,516 | — | 165,716 | 160,800 | ||||||||||||||||||
Total derivatives subject to a master netting arrangement or similar arrangement | 427,663 | 16,236 | 411,427 | — | 166,338 | 245,089 | ||||||||||||||||||
Total derivatives not subject to a master netting arrangement or similar arrangement(2) | 148 | — | 148 | — | — | 148 | ||||||||||||||||||
Total Derivative Liabilities | $ | 427,811 | $ | 16,236 | $ | 411,575 | $ | — | $ | 166,338 | $ | 245,237 |
(1) | Includes customer-related and other derivatives. |
(2) | Includes mortgage banking derivatives. |
(in thousands) | Level 1 | Level 2 | Level 3 | Balance at June 30, 2018 | Level 1 | Level 2 | Level 3 | Balance at December 31, 2017 | ||||||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||||||||||
U.S. Treasury securities | $ | 342,021 | $ | 1,275,781 | $ | — | $ | 1,617,802 | $ | 139,615 | $ | 858,497 | $ | — | $ | 998,112 | ||||||||||||||||
Corporate debt | — | 6,453 | — | 6,453 | — | 11,660 | — | 11,660 | ||||||||||||||||||||||||
ABS | — | 130,621 | 346,856 | 477,477 | — | 156,910 | 350,252 | 507,162 | ||||||||||||||||||||||||
State and municipal securities | — | 20 | — | 20 | — | 23 | — | 23 | ||||||||||||||||||||||||
MBS | — | 10,963,121 | — | 10,963,121 | — | 12,885,412 | — | 12,885,412 | ||||||||||||||||||||||||
Investment in debt securities AFS(3)(6) | 342,021 | 12,375,996 | 346,856 | 13,064,873 | 139,615 | 13,912,502 | 350,252 | 14,402,369 | ||||||||||||||||||||||||
Other investments - trading securities | 1 | 1,873 | — | 1,874 | 1 | — | — | 1 | ||||||||||||||||||||||||
RICs HFI(4) | — | — | 152,082 | 152,082 | — | — | 186,471 | 186,471 | ||||||||||||||||||||||||
LHFS (1)(5) | — | 238,864 | — | 238,864 | — | 197,691 | — | 197,691 | ||||||||||||||||||||||||
MSRs (2) | — | — | 158,470 | 158,470 | — | — | 145,993 | 145,993 | ||||||||||||||||||||||||
Other assets - derivatives (3) | — | 651,021 | 2,384 | 653,405 | — | 461,139 | 2,105 | 463,244 | ||||||||||||||||||||||||
Total financial assets | $ | 342,022 | $ | 13,267,754 | $ | 659,792 | $ | 14,269,568 | $ | 139,616 | $ | 14,571,332 | $ | 684,821 | $ | 15,395,769 | ||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||||||||||
Other liabilities - derivatives (3) | — | 616,050 | 1,839 | 617,889 | — | 427,217 | 594 | 427,811 | ||||||||||||||||||||||||
Total financial liabilities | $ | — | $ | 616,050 | $ | 1,839 | $ | 617,889 | $ | — | $ | 427,217 | $ | 594 | $ | 427,811 |
(1) | LHFS disclosed on the Condensed Consolidated Balance Sheets also includes LHFS that are held at the lower of cost or fair value and are not presented within this table. |
(2) | The Company has total MSRs of $161.3 million and $149.2 million as of June 30, 2018.and December 31, 2017, respectively. The Company has elected to account for the majority of its MSR balance using the FVO, while the remainder of the MSRs are accounted for using the lower of cost or fair value and are not presented within this table. |
(3) | Refer to Note 3 for the fair value of investment securities and to Note 12 for the fair values of derivative assets and liabilities, on a further disaggregated basis. |
(in thousands) | Level 1 | Level 2 | Level 3 | Balance at June 30, 2018 | Level 1 | Level 2 | Level 3 | Balance at December 31, 2017 | ||||||||||||||||||||||||
Impaired commercial LHFI | $ | — | $ | 127,803 | $ | 324,816 | $ | 452,619 | $ | — | $ | 226,832 | $ | 356,343 | $ | 583,175 | ||||||||||||||||
Foreclosed assets | — | 11,951 | 98,241 | 110,192 | — | 20,011 | 106,581 | 126,592 | ||||||||||||||||||||||||
Vehicle inventory | — | 255,361 | — | 255,361 | — | 325,203 | — | 325,203 | ||||||||||||||||||||||||
LHFS(1) | — | — | 1,320,960 | 1,320,960 | — | — | 2,324,830 | 2,324,830 | ||||||||||||||||||||||||
Auto loans impaired due to bankruptcy | — | 162,184 | — | 162,184 | — | 121,578 | — | 121,578 | ||||||||||||||||||||||||
MSRs | — | — | 9,358 | 9,358 | — | — | 9,273 | 9,273 |
(1) | These amounts include $956.4 million and $1.1 billion of personal loans held for sale that are impaired as of June 30, 2018 and December 31, 2017, respectively. |
Three-Month Period Ended June 30, 2018 | Six-Month Period Ended June 30, | ||||||||||||||||
(in thousands) | Statement of Operations Location | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Impaired LHFI | Provision for credit losses | $ | 29,891 | $ | 12,969 | $ | 579 | $ | (32,803 | ) | |||||||
Foreclosed assets | Miscellaneous income(1) | (2,129 | ) | (2,929 | ) | (4,601 | ) | (4,671 | ) | ||||||||
LHFS | Provision for credit losses | (6 | ) | (13,200 | ) | (387 | ) | (13,200 | ) | ||||||||
LHFS | Miscellaneous income(1) | (79,221 | ) | (95,921 | ) | (149,711 | ) | (162,042 | ) | ||||||||
Auto loans impaired due to bankruptcy | Provision for credit losses | (6,667 | ) | (24,513 | ) | (88,812 | ) | (48,113 | ) | ||||||||
MSRs | Miscellaneous income, net | 929 | 102 | 380 | 197 |
(1) | These amounts reduce Miscellaneous income. |
Three-Month Period Ended June 30, 2018 | Three-Month Period Ended June 30, 2017 | |||||||||||||||||||||||||||||||||||||||
(in thousands) | Investments AFS | RICs Held for Investment | MSRs | Derivatives | Total | Investments AFS | RICs Held for Investment | MSRs | Derivatives | Total | ||||||||||||||||||||||||||||||
Balances, beginning of period | $ | 348,634 | $ | 167,597 | $ | 160,130 | $ | 1,746 | $ | 678,107 | $ | 573,454 | $ | 202,473 | $ | 149,455 | $ | (27,709 | ) | $ | 897,673 | |||||||||||||||||||
Losses in other comprehensive income | (1,275 | ) | — | — | — | (1,275 | ) | (2,059 | ) | — | — | — | (2,059 | ) | ||||||||||||||||||||||||||
Gains/(losses) in earnings | — | 4,760 | (1,274 | ) | (1,299 | ) | 2,187 | — | 4,742 | (1,194 | ) | (1,409 | ) | 2,139 | ||||||||||||||||||||||||||
Additions/Issuances | — | 1,927 | 2,841 | — | 4,768 | — | 6,396 | 2,867 | — | 9,263 | ||||||||||||||||||||||||||||||
Settlements(1) | (503 | ) | (22,202 | ) | (3,227 | ) | 98 | (25,834 | ) | 16,176 | (6,395 | ) | (5,037 | ) | 98 | 4,842 | ||||||||||||||||||||||||
Balances, end of period | $ | 346,856 | $ | 152,082 | $ | 158,470 | $ | 545 | $ | 657,953 | $ | 587,571 | $ | 207,216 | $ | 146,091 | $ | (29,020 | ) | $ | 911,858 | |||||||||||||||||||
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | $ | — | $ | 4,760 | $ | (1,274 | ) | $ | (1,430 | ) | $ | 2,056 | $ | — | $ | 4,742 | $ | (1,194 | ) | $ | 5 | $ | 3,553 | |||||||||||||||||
Six-Month Period Ended June 30, 2018 | Six-Month Period Ended June 30, 2017 | |||||||||||||||||||||||||||||||||||||||
(in thousands) | Investments AFS | RICs HFI | MSRs | Derivatives | Total | Investments AFS | RICs HFI | MSRs | Derivatives | Total | ||||||||||||||||||||||||||||||
Balances, beginning of period | $ | 350,252 | $ | 186,471 | $ | 145,993 | $ | 1,514 | $ | 684,230 | $ | 814,567 | $ | 217,170 | $ | 146,589 | $ | (29,000 | ) | $ | 1,149,326 | |||||||||||||||||||
Losses in other comprehensive income | (1,774 | ) | — | — | — | (1,774 | ) | (2,678 | ) | — | — | — | (2,678 | ) | ||||||||||||||||||||||||||
Gains/(losses) in earnings | — | 10,036 | 13,769 | (1,165 | ) | 22,640 | — | 21,633 | 263 | (215 | ) | 21,681 | ||||||||||||||||||||||||||||
Additions/Issuances | — | 3,276 | 5,597 | — | 8,873 | — | 19,727 | 8,597 | — | 28,324 | ||||||||||||||||||||||||||||||
Settlements(1) | (1,622 | ) | (47,701 | ) | (6,889 | ) | 196 | (56,016 | ) | (224,318 | ) | (51,314 | ) | (9,358 | ) | 195 | (284,795 | ) | ||||||||||||||||||||||
Balances, end of period | $ | 346,856 | $ | 152,082 | $ | 158,470 | $ | 545 | $ | 657,953 | $ | 587,571 | $ | 207,216 | $ | 146,091 | $ | (29,020 | ) | $ | 911,858 | |||||||||||||||||||
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | $ | — | $ | 10,036 | $ | 13,769 | $ | (1,444 | ) | $ | 22,361 | $ | — | $ | 21,633 | $ | 263 | $ | (795 | ) | $ | 21,101 |
(1) | Settlements include charge-offs, prepayments, paydowns and maturities. |
• | A 10% and 20% increase in the CPR speed would decrease the fair value of the residential servicing asset by $5.2 million and $10.0 million, respectively, at June 30, 2018. |
• | A 10% and 20% increase in the discount rate would decrease the fair value of the residential servicing asset by $5.9 million and $11.3 million, respectively, at June 30, 2018. |
(dollars in thousands) | Fair Value at June 30, 2018 | Valuation Technique | Unobservable Inputs | Range (Weighted Average) | |||||||
Financial Assets: | |||||||||||
ABS | |||||||||||
Financing bonds | $ | 304,382 | DCF | Discount Rate (1) | 3.00% - 3.20% (3.03%) | ||||||
Sale-leaseback securities | $ | 42,474 | Consensus Pricing (2) | Offered quotes (3) | 113.61 | % | |||||
RICs HFI | $ | 152,082 | DCF | Prepayment rate (CPR) (4) | 6.66 | % | |||||
Discount Rate (5) | 9.50% - 14.50% (12.47% ) | ||||||||||
Recovery Rate (6) | 25.00% - 43.00% (41.6% ) | ||||||||||
Personal LHFS | $ | 956,455 | Lower of Market or Income Approach | Market Participant View | 70.00% - 80.00% | ||||||
Discount Rate | 15.00% - 25.00% | ||||||||||
Default Rate | 30.00% - 40.00% | ||||||||||
Net Principal Payment Rate | 50.00% - 70.00% | ||||||||||
Loss Severity Rate | 90.00% - 95.00% | ||||||||||
RICs HFS | $ | 280,113 | Income Approach | Expected Yield | 1.00% - 2.00% | ||||||
Expected Life Time Cumulative Loss | 4.00% - 6.00% | ||||||||||
Weighted Average Life | 2 -3 years | ||||||||||
MSRs (11) | $ | 158,470 | DCF | Prepayment rate ("CPR") (7) | 6.91% - 100.00% (8.49%) | ||||||
Discount Rate (8) | 9.75 | % | |||||||||
Mortgage banking interest rate lock commitments | $ | 2,384 | DCF | Pull through percentage (9) | 77.52 | % | |||||
MSR value (10) | 0.73% - 1.03% (1.14%) |
(1) | Based on the applicable term and discount index. |
(2) | Consensus pricing refers to fair value estimates that are generally developed using information such as dealer quotes or other third-party valuations or comparable asset prices. |
(3) | Based on the nature of the input, a range or weighted average does not exist. For sale-leaseback securities, the Company owns one security. |
(4) | Based on the analysis of available data from a comparable market securitization of similar assets. |
(5) | Based on the cost of funding of debt issuance and recent historical equity yields. |
(6) | Based on the average severity utilizing reported severity rates and loss severity utilizing available market data from a comparable securitized pool. |
(7) | Average CPR projected from collateral stratified by loan type and note rate. |
(8) | Average discount rate from collateral stratified by loan type and note rate. |
(9) | Historical weighted average based on principal balance calculated as the percentage of loans originated for sale divided by total commitments less outstanding commitments. |
(10) | MSR value is the estimated value of the servicing right embedded in the underlying loan, expressed in basis points of outstanding unpaid principal balance. |
(11) | Excludes MSR valued on a non-recurring basis for which we do not consider there to be significant unobservable assumptions. |
(dollars in thousands) | Fair Value at December 31, 2017 | Valuation Technique | Unobservable Inputs | Range (Weighted Average) | ||||||
Financing bonds | ||||||||||
ABS | ||||||||||
Financing bonds | $ | 304,727 | DCF | Discount Rate (1) | 2.16% - 2.90% (2.28%) | |||||
Sale-leaseback securities | $ | 45,525 | Consensus Pricing (2) | Offered Quotes (3) | 120.19 | % | ||||
RICs HFI | $ | 186,471 | DCF | CPR (4) | 6.66 | % | ||||
Discount Rate (5) | 9.50% - 14.50% (12.37%) | |||||||||
Recovery Rate (6) | 25.00% - 43.00% (41.51%) | |||||||||
Personal LHFS | $ | 1,062,090 | Lower of Market or Income Approach | Market Participant View | 70.00% - 80.00% | |||||
Discount Rate | 15.00% - 20.00% | |||||||||
Default Rate | 30.00% - 40.00% | |||||||||
Net Principal Payment Rate | 50.00% - 70.00% | |||||||||
Loss Severity Rate | 90.00% - 95.00% | |||||||||
RICs HFS | $ | 1,101,049 | DCF | Discount Rate | 3.00% - 6.00% | |||||
Default Rate | 3.00% - 4.00% | |||||||||
Prepayment Rate | 15.00% - 20.00% | |||||||||
Loss Severity Rate | 50.00% - 60.00% | |||||||||
MSRs (11) | $ | 145,993 | DCF | CPR (7) | 0.06% - 46.95% (9.80%) | |||||
Discount Rate (8) | 9.90 | % | ||||||||
Mortgage banking interest rate lock commitments | $ | 2,105 | DCF | Pull through percentage (9) | 76.98 | % | ||||
MSR Value (10) | 0.73% - 1.03% (0.95%) |
(1) | Based on the applicable term and discount index. |
(2) | Consensus pricing refers to fair value estimates that are generally developed using information such as dealer quotes or other third-party valuations or comparable asset prices. |
(3) | Based on the nature of the input, a range or weighted average does not exist. For sale-leaseback securities, the Company owns one security. |
(4) | Based on the analysis of available data from a comparable market securitization of similar assets. |
(5) | Based on the cost of funding of debt issuance and recent historical equity yields. |
(6) | Based on the average severity utilizing reported severity rates and loss severity utilizing available market data from a comparable securitized pool. |
(7) | Average CPR projected from collateral stratified by loan type and note rate. |
(8) | Average discount rate from collateral stratified by loan type and note rate. |
(9) | Historical weighted average based on principal balance calculated as the percentage of loans originated for sale divided by total commitments less outstanding commitments. |
(10) | MSR value is the estimated value of the servicing right embedded in the underlying loan, expressed in basis points of outstanding unpaid principal balance. |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||||||||||
(in thousands) | Carrying Value | Fair Value | Level 1 | Level 2 | Level 3 | Carrying Value | Fair Value | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||||
Financial assets: | ||||||||||||||||||||||||||||||||||||||||
Cash and amounts due from depository institutions | $ | 6,127,604 | $ | 6,127,604 | $ | 6,127,604 | $ | — | $ | — | $ | 6,519,967 | $ | 6,519,967 | $ | 6,519,967 | $ | — | $ | — | ||||||||||||||||||||
Investment in debt securities AFS (2) | 13,064,873 | 13,064,873 | 342,021 | 12,375,996 | 346,856 | 14,402,369 | 14,402,369 | 139,615 | 13,912,502 | 350,252 | ||||||||||||||||||||||||||||||
Investment in debt securities HTM | 2,920,087 | 2,826,499 | — | 2,826,499 | — | 1,799,808 | 1,773,938 | — | 1,773,938 | — | ||||||||||||||||||||||||||||||
Other investments - trading securities | 1,874 | 1,874 | 1 | 1,873 | — | 1 | 1 | 1 | — | — | ||||||||||||||||||||||||||||||
LHFI, net | 79,326,170 | 79,833,705 | — | 37,803 | 79,795,902 | 76,829,277 | 78,579,144 | — | 136,832 | 78,442,312 | ||||||||||||||||||||||||||||||
LHFS | 1,559,799 | 1,559,824 | — | 238,864 | 1,320,960 | 2,522,486 | 2,522,521 | — | 197,691 | 2,324,830 | ||||||||||||||||||||||||||||||
Restricted cash | 3,123,208 | 3,123,208 | 3,123,208 | — | — | 3,818,807 | 3,818,807 | 3,818,807 | — | — | ||||||||||||||||||||||||||||||
MSRs(1) | 161,294 | 167,828 | — | — | 167,828 | 149,197 | 155,266 | — | — | 155,266 | ||||||||||||||||||||||||||||||
Derivatives | 653,405 | 653,405 | — | 651,021 | 2,384 | 463,244 | 463,244 | — | 461,139 | 2,105 | ||||||||||||||||||||||||||||||
Financial liabilities: | ||||||||||||||||||||||||||||||||||||||||
Deposits | 61,556,548 | 61,556,508 | 55,757,515 | 5,798,993 | — | 60,831,103 | 60,864,110 | 55,456,511 | 5,407,599 | — | ||||||||||||||||||||||||||||||
Borrowings and other debt obligations | 38,771,378 | 38,907,770 | — | 26,351,342 | 12,556,428 | 39,003,313 | 39,335,087 | — | 23,281,166 | 16,053,921 | ||||||||||||||||||||||||||||||
Derivatives | 617,889 | 617,889 | — | 616,050 | 1,839 | 427,811 | 427,811 | — | 427,217 | 594 |
(1) | The Company has elected to account for the majority of its MSR balance using the FVO, while the remainder of the MSRs are accounted for using the lower of cost or fair value. |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||
(in thousands) | Fair Value | Aggregate UPB | Difference | Fair Value | Aggregate UPB | Difference | ||||||||||||||||||
LHFS(1) | $ | 238,864 | $ | 231,327 | $ | 7,537 | $ | 197,691 | $ | 194,928 | $ | 2,763 | ||||||||||||
RICs HFI | 152,082 | 172,448 | (20,366 | ) | 186,471 | 211,580 | (25,109 | ) | ||||||||||||||||
Nonaccrual loans | 8,523 | 11,863 | (3,340 | ) | 15,023 | 19,836 | (4,813 | ) |
(1) | LHFS disclosed on the Condensed Consolidated Balance Sheets also includes LHFS that are held at the lower of cost or fair value that are not presented within this table. There were no nonaccrual loans related to the LHFS measured using the FVO. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | |||||||||||||||
(in thousands) | 2018 | 2017 (1) | 2018 | 2017 (1) | ||||||||||||
Non-interest income: | ||||||||||||||||
Consumer and commercial fees | $ | 136,165 | $ | 162,334 | $ | 276,337 | $ | 316,702 | ||||||||
Lease income | 569,306 | 489,043 | 1,110,202 | 985,087 | ||||||||||||
Miscellaneous income, net | ||||||||||||||||
Mortgage banking income, net | 2,933 | 15,092 | 19,278 | 28,266 | ||||||||||||
BOLI | 14,816 | 14,052 | 29,384 | 31,351 | ||||||||||||
Capital market revenue | 41,083 | 39,771 | 97,696 | 85,587 | ||||||||||||
Net gain on sale of operating leases | 65,742 | 39,810 | 118,941 | 62,525 | ||||||||||||
Asset and wealth management fees | 43,922 | 39,438 | 87,259 | 75,939 | ||||||||||||
Loss on sale of non-mortgage loans | (74,872 | ) | (87,837 | ) | (118,782 | ) | (157,604 | ) | ||||||||
Other miscellaneous income, net | 19,659 | 9,057 | 309 | 18,462 | ||||||||||||
Net (losses)/gains on sale of investment securities | 419 | 9,049 | (244 | ) | 9,569 | |||||||||||
Total non-interest income | $ | 819,173 | $ | 729,809 | $ | 1,620,380 | $ | 1,455,884 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | |||||||||||||||
(in thousands) | 2018 | 2017 (1) | 2018 | 2017 (1) | ||||||||||||
Non-interest income: | ||||||||||||||||
In-scope of revenue from contracts with customers: | ||||||||||||||||
Depository services(2) | $ | 57,432 | $ | 62,415 | $ | 115,778 | $ | 122,855 | ||||||||
Commission and trailer fees(3) | 31,982 | 30,179 | 61,432 | 61,347 | ||||||||||||
Interchange income, net(3) | 16,170 | 16,745 | 29,643 | 29,394 | ||||||||||||
Underwriting service fees(3) | 24,840 | 17,962 | 49,344 | 42,562 | ||||||||||||
Asset and wealth management fees(3) | 42,151 | 30,816 | 80,354 | 59,061 | ||||||||||||
Other revenue from contracts with customers(3) | 7,684 | 7,559 | 17,686 | 20,870 | ||||||||||||
Total in-scope of revenue from contracts with customers | 180,259 | 165,676 | 354,237 | 336,089 | ||||||||||||
Out-of-scope of revenue from contracts with customers: | ||||||||||||||||
Consumer and commercial fees(4) | 70,971 | 94,403 | 144,175 | 181,499 | ||||||||||||
Lease income | 569,306 | 489,043 | 1,110,202 | 985,087 | ||||||||||||
Miscellaneous income/(loss)(4) | (1,782 | ) | (28,362 | ) | 12,010 | (56,360 | ) | |||||||||
Net (losses)/gains on sale of investment securities | 419 | 9,049 | (244 | ) | 9,569 | |||||||||||
Total out-of-scope of revenue from contracts with customers | 638,914 | 564,133 | 1,266,143 | 1,119,795 | ||||||||||||
Total non-interest income | $ | 819,173 | $ | 729,809 | $ | 1,620,380 | $ | 1,455,884 |
Other Commitments | June 30, 2018 | December 31, 2017 | ||||||
(in thousands) | ||||||||
Commitments to extend credit | $ | 29,713,289 | $ | 29,475,864 | ||||
Letters of credit | 1,460,244 | 1,559,297 | ||||||
Unsecured revolving lines of credit | 28,002 | 27,938 | ||||||
Recourse exposure on sold loans | 36,981 | 46,572 | ||||||
Commitments to sell loans | 50,011 | 19,477 | ||||||
Total commitments | $ | 31,288,527 | $ | 31,129,148 |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
1 year or less | $ | 4,785,053 | $ | 5,858,236 | ||||
Over 1 year to 3 years | 4,476,079 | 5,381,113 | ||||||
Over 3 years to 5 years | 5,981,334 | 4,478,320 | ||||||
Over 5 years (1) | 14,470,823 | 13,758,195 | ||||||
Total | $ | 29,713,289 | $ | 29,475,864 |
(1) | Includes certain commitments to extend credit that do not have a contractual maturity date, but are expected to be outstanding more than 5 years. |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
1 year or less | $ | 753,852 | $ | 918,191 | ||||
Over 1 year to 3 years | 308,273 | 286,505 | ||||||
Over 3 years to 5 years | 313,009 | 312,881 | ||||||
Over 5 years | 85,110 | 41,720 | ||||||
Total | $ | 1,460,244 | $ | 1,559,297 |
• | SC received a civil subpoena from the DOJ under Financial Institutions Reform, Recovery and Enforcement Act, requesting the production of documents and communications that, among other things, relate to the underwriting and securitization of nonprime vehicle loans, and also from the SEC requesting the production of documents and communications that, among other things, relate to the underwriting and securitization of nonprime vehicle loans. SC has responded to these requests within the deadlines specified in the subpoenas and has otherwise cooperated with the DOJ and the SEC with respect to these matters. |
• | In October 2014, May 2015, July 2015 and February 2017, SC received subpoenas and/or CIDs from the attorneys general of California, Illinois, Oregon, New Jersey, Maryland and Washington under the authority of each state's consumer protection statutes. SC has been informed that these states will serve as an executive committee on behalf of a group of 31 state Attorneys General. The subpoenas and/or CIDs from the executive committee states contain broad requests for information and the production of documents related to SC’s underwriting, securitization, servicing and collection of nonprime vehicle loans. SC has responded to these requests within the deadlines specified in the subpoenas and/or CIDs, and has otherwise cooperated with the Attorneys General with respect to this matter. |
• | In February 2016, the CFPB issued a supervisory letter relating to its investigation of SC’s compliance systems, Board and senior management oversight, consumer complaint handling, marketing of guaranteed auto protection ("GAP") coverage and loan deferral disclosure practices. SC subsequently received a series of CIDs from the CFPB requesting information and testimony regarding SC’s marketing of GAP coverage and loan deferral disclosure practices. SC has responded to these requests within the deadlines specified in the CIDs, and has otherwise cooperated with the CFPB with respect to this matter. |
• | In August 2017, SC received a CID from the CFPB. The stated purpose of the CID is to determine whether SC has complied with the Fair Credit Reporting Act and related regulations. SC has responded to these requests within the deadlines specified in the CID and has otherwise cooperated with the CFPB with respect to this matter. |
Six-Month Period Ended June 30, | ||||||||
(in thousands) | 2018 | 2017 | ||||||
Cash contribution | $ | 5,741 | $ | 9,000 | ||||
Adjustment to book value of assets purchased on January 1 | 277 | — | ||||||
Deferred tax asset on purchased assets | 3,156 | — | ||||||
Contribution from shareholder | $ | 9,174 | $ | 9,000 |
• | The Commercial Banking and the CRE reportable segments were combined into the Commercial Banking reportable segment. |
• | SIS, a subsidiary of SHUSA, that was formerly located within the Other category was moved to the GCB reportable segment. |
• | The Company's internal funds transfer pricing ("FTP") methodologies and cost allocations were updated to align with Santander corporate criteria for internal management reporting. These FTP and cost allocation changes impact how certain costs are allocated for all reporting segments, excluding SC. |
• | The Consumer and Business Banking segment includes the products and services provided to Bank customers through the Bank's branch locations, including consumer deposit, business banking, residential mortgage, unsecured lending and investment services. The branch locations offer a wide range of products and services to consumers and business banking customers, including demand and interest-bearing demand deposit accounts, money market and savings accounts, CDs and retirement savings products. The branch locations also offer lending products such as credit cards, mortgages, home equity lines of credit, and business loans such as commercial lines of credit and business credit cards. In addition, the Bank provides investment services to its retail customers, including annuities, mutual funds, and insurance products. Santander Universities, which provides grants and scholarships to universities and colleges as a way to foster education through research, innovation and entrepreneurship, is the last component of this segment. |
• | The Commercial Banking segment currently provides commercial lines, loans, and deposits to medium and large business banking customers, as well as financing and deposits for government entities, commercial real estate loans and multifamily loans to customers, commercial loans to dealers and financing for equipment and commercial vehicles. This segment also provides financing and deposits for government entities and niche product financing for specific industries. |
• | The CIB segment serves the needs of global commercial and institutional customers by leveraging the international footprint of Santander to provide financing and banking services to corporations with over $500 million in annual revenues. CIB also includes SIS, a registered broker-dealer located in New York that provides services in investment banking, institutional sales, and trading and offering research reports of Latin American and European equity and fixed-income securities. CIB's offerings and strategy are based on Santander's local and global capabilities in wholesale banking. |
• | SC is a specialized consumer finance company focused on vehicle finance and third-party servicing. SC’s primary business is the indirect origination of RICs, principally through manufacturer-franchised dealers in connection with their sale of new and used vehicles to retail consumers. In conjunction with a ten-year private label financing agreement with FCA that became effective May 1, 2013, SC offers a full spectrum of auto financing products and services to FCA customers and dealers under the Chrysler Capital brand. These products and services include consumer RICs and leases, as well as dealer loans for inventory, construction, real estate, working capital and revolving lines of credit. SC also originates vehicle loans through a web-based direct lending program, purchases vehicle RICs from other lenders, and services automobile, recreational and marine vehicle portfolios for other lenders. During 2015, SC announced its intention to exit the personal lending business. |
For the Three-Month Period Ended | SHUSA Reportable Segments | |||||||||||||||||||||||||
June 30, 2018 | Consumer & Business Banking | Commercial Banking | CIB | Other(2) | SC(3) | SC Purchase Price Adjustments(4) | Eliminations(4) | Total | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Net interest income | $ | 316,223 | $ | 160,824 | $ | 30,901 | $ | 66,267 | $ | 946,572 | $ | 7,693 | $ | 9,136 | $ | 1,537,616 | ||||||||||
Non-interest income | 69,647 | 16,120 | 64,740 | 110,271 | 567,693 | 2,869 | (12,167 | ) | 819,173 | |||||||||||||||||
Provision for / (release of) credit losses | 18,283 | (13,001 | ) | 3,764 | 8,621 | 352,575 | 9,592 | — | 379,834 | |||||||||||||||||
Total expenses | 367,235 | 84,769 | 58,507 | 217,368 | 713,045 | 11,683 | (2,858 | ) | 1,449,749 | |||||||||||||||||
Income/(loss) before income taxes | 352 | 105,176 | 33,370 | (49,451 | ) | 448,645 | (10,713 | ) | (173 | ) | 527,206 | |||||||||||||||
Intersegment revenue/(expense)(1) | 521 | 2,562 | (3,527 | ) | 444 | — | — | — | — | |||||||||||||||||
Total assets | 19,088,997 | 25,124,793 | 7,832,197 | 36,919,571 | 41,173,136 | — | — | 130,138,694 |
For the Six-Month Period Ended | SHUSA Reportable Segments | |||||||||||||||||||||||||
June 30, 2018 | Consumer & Business Banking | Commercial Banking | CIB | Other(2) | SC(3) | SC Purchase Price Adjustments(4) | Eliminations(4) | Total | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Net interest income | $ | 621,045 | $ | 315,759 | $ | 63,591 | $ | 129,070 | $ | 1,868,311 | $ | 17,588 | $ | 18,194 | $ | 3,033,558 | ||||||||||
Non-interest income | 152,465 | 49,708 | 115,378 | 221,540 | 1,099,429 | 5,555 | (23,695 | ) | 1,620,380 | |||||||||||||||||
Provision for / (release of) credit losses | 56,672 | (22,742 | ) | 1,709 | 14,958 | 811,570 | 20,201 | — | 882,368 | |||||||||||||||||
Total expenses | 738,303 | 167,407 | 116,574 | 442,975 | 1,407,915 | 23,412 | (5,479 | ) | 2,891,107 | |||||||||||||||||
Income/(loss) before income taxes | (21,465 | ) | 220,802 | 60,686 | (107,323 | ) | 748,255 | (20,470 | ) | (22 | ) | 880,463 | ||||||||||||||
Intersegment revenue/(expense)(1) | 1,198 | 4,093 | (5,808 | ) | 517 | — | — | — | — | |||||||||||||||||
Total assets | 19,088,997 | 25,124,793 | 7,832,197 | 36,919,571 | 41,173,136 | — | — | 130,138,694 |
(1) | Intersegment revenue/(expense) represents charges or credits for funds used or provided by each of the segments and is included in net interest income. |
(2) | Other includes the results of the entities transferred to the IHC, earnings from non-strategic assets, the investment portfolio, interest expense on the Bank’s and the Company's borrowings and other debt obligations, amortization of intangible assets and certain unallocated corporate income and indirect expenses. |
(3) | Management of SHUSA manages SC by analyzing the pre-Change in Control results of SC as disclosed in this column. |
(4) | Purchase Price Adjustments represents the impact that SC purchase marks had on the results of SC included within the consolidated operations of SHUSA, while eliminations eliminate intercompany transactions. |
For the Three-Month Period Ended | SHUSA Reportable Segments | |||||||||||||||||||||||||
June 30, 2017 | Consumer & Business Banking | Commercial Banking | CIB | Other(2) | SC(3) | SC Purchase Price Adjustments(4) | Eliminations(4) | Total | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Net interest income | $ | 277,069 | $ | 162,953 | $ | 40,860 | $ | 65,273 | $ | 1,053,673 | $ | 34,095 | $ | 7,826 | $ | 1,641,749 | ||||||||||
Non-interest income | 94,285 | 18,858 | 42,375 | 155,855 | 432,373 | (3,719 | ) | (10,218 | ) | 729,809 | ||||||||||||||||
Provision for / (release of) credit losses | 21,410 | (1,089 | ) | 13,635 | 16,051 | 520,555 | 34,206 | — | 604,768 | |||||||||||||||||
Total expenses | 381,844 | 78,753 | 59,454 | 244,249 | 617,383 | 11,508 | (6,147 | ) | 1,387,044 | |||||||||||||||||
Income/(loss) before income taxes | (31,900 | ) | 104,147 | 10,146 | (39,172 | ) | 348,108 | (15,338 | ) | 3,755 | 379,746 | |||||||||||||||
Intersegment revenue/(expense)(1) | 329 | 1,750 | (2,089 | ) | 10 | — | — | — | — | |||||||||||||||||
Total assets | 18,077,481 | 25,776,884 | 8,949,566 | 42,444,282 | 39,507,482 | — | — | 134,755,695 |
For the Six-Month Period Ended | SHUSA Reportable Segments | |||||||||||||||||||||||||
June 30, 2017 | Consumer & Business Banking | Commercial Banking | CIB | Other(2) | SC(3) | SC Purchase Price Adjustments(4) | Eliminations(4) | Total | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Net interest income | $ | 539,800 | $ | 315,259 | $ | 83,088 | $ | 122,000 | $ | 2,096,600 | $ | 71,399 | $ | 16,167 | $ | 3,244,313 | ||||||||||
Non-interest income | 176,819 | 33,781 | 93,711 | 304,619 | 867,221 | 1,735 | (22,002 | ) | 1,455,884 | |||||||||||||||||
Provision for / (release of) credit losses | 43,861 | 4,297 | 12,271 | 31,663 | 1,155,568 | 92,554 | — | 1,340,214 | ||||||||||||||||||
Total expenses | 756,864 | 157,092 | 106,062 | 467,939 | 1,238,717 | 23,380 | (12,463 | ) | 2,737,591 | |||||||||||||||||
Income/(loss) before income taxes | (84,106 | ) | 187,651 | 58,466 | (72,983 | ) | 569,536 | (42,800 | ) | 6,628 | 622,392 | |||||||||||||||
Intersegment revenue/(expense)(1) | 1,206 | 3,052 | (4,486 | ) | 228 | — | — | — | — | |||||||||||||||||
Total assets | 18,077,481 | 25,776,884 | 8,949,566 | 42,444,282 | 39,507,482 | — | — | 134,755,695 |
(1) | Intersegment revenue/(expense) represents charges or credits for funds used or provided by each of the segments and is included in net interest income. |
(2) | Other includes the results of the entities transferred to the IHC, earnings from non-strategic assets, the investment portfolio, interest expense on the Bank’s and the Company's borrowings and other debt obligations, amortization of intangible assets and certain unallocated corporate income and indirect expenses. |
(3) | Management of SHUSA manages SC by analyzing the pre-Change in Control results of SC as disclosed in this column. |
(4) | Purchase Price Adjustments represents the impact that SC purchase marks had on the results of SC included within the consolidated operations of SHUSA, while eliminations eliminate intercompany transactions. |
June 30, 2018 | ||
Dow Jones Industrial Average | (1.8)% | |
S&P 500 | 1.7% | |
NASDAQ Composite | 8.8% |
BANK | BSPR(1) | SHUSA | ||||||||||
Moody's | S&P | Fitch (2) | Moody's | S&P | Fitch (2) | Moody's | S&P | Fitch | ||||
Long-Term | Baa1 | A- | BBB+ | Baa1 | N/A | BBB+ | Baa3 | BBB+ | BBB+ | |||
Short-Term | P-1 | A-2 | F-2 | P-1/P-2 | N/A | F-2 | n/a | A-2 | F-2 | |||
Outlook | Stable | Stable | Stable | Stable | N/A | Stable | Stable | Stable | Stable |
SANTANDER | SPAIN | ||||||||
Moody's | S&P | Fitch | Moody's | S&P | Fitch | ||||
Long-Term | A2 | A | A | Baa1 | A- | A- | |||
Short-Term | P-1 | A-1 | F-1 | P-2 | A-2 | F-1 | |||
Outlook | Stable | Stable | Stable | Stable | Positive | Stable |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
Net interest income | $ | 1,537,616 | $ | 1,641,749 | $ | 3,033,558 | $ | 3,244,313 | $ | (104,133 | ) | (6.3 | )% | $ | (210,755 | ) | (6.5 | )% | |||||||||||
Provision for credit losses | (379,834 | ) | (604,768 | ) | (882,368 | ) | (1,340,214 | ) | (224,934 | ) | (37.2 | )% | (457,846 | ) | (34.2 | )% | |||||||||||||
Total non-interest income | 819,173 | 729,809 | 1,620,380 | 1,455,884 | 89,364 | 12.2 | % | 164,496 | 11.3 | % | |||||||||||||||||||
General and administrative expenses | (1,416,948 | ) | (1,341,636 | ) | (2,822,608 | ) | (2,651,475 | ) | 75,312 | 5.6 | % | 171,133 | 6.5 | % | |||||||||||||||
Other expenses | (32,801 | ) | (45,408 | ) | (68,499 | ) | (86,116 | ) | (12,607 | ) | (27.8 | )% | (17,617 | ) | (20.5 | )% | |||||||||||||
Income before income taxes | 527,206 | 379,746 | 880,463 | 622,392 | 147,460 | 38.8 | % | 258,071 | 41.5 | % | |||||||||||||||||||
Income tax provision | (168,035 | ) | (91,983 | ) | (263,356 | ) | (170,920 | ) | 76,052 | 82.7 | % | 92,436 | 54.1 | % | |||||||||||||||
Net income | $ | 359,171 | $ | 287,763 | 617,107 | 451,472 | $ | 71,408 | 24.8 | % | $ | 165,635 | 36.7 | % | |||||||||||||||
Net income attributable to NCI | $ | 104,018 | $ | 104,724 | 178,416 | 155,352 | $ | (706 | ) | (0.7 | )% | $ | 23,064 | 14.8 | % | ||||||||||||||
Net income attributable to SHUSA | $ | 255,153 | $ | 183,039 | $ | 438,691 | $ | 296,120 | $ | 72,114 | 39.4 | % | $ | 142,571 | 48.1 | % |
• | Net interest income decreased $104.1 million and $210.8 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This decrease was primarily due to a decrease in interest income earned on loans due to a decrease in the average loan portfolio and declining yields on RIC loans. Interest expense on deposit customer accounts increased due to yield increases and promotional rates offered to customers to attract new customers and grow the existing customer base. |
• | The provision for credit losses decreased $224.9 million and $457.8 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This decrease was primarily due to decreases in the overall loan portfolio resulting in a decreased ALLL and a decline in originations, stabilizing credit performance for non-troubled debt restructuring ("TDR") loans, and recovery rates for the RIC and auto loan portfolio. |
• | Total non-interest income increased $89.4 million and $164.5 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This increase was primarily due to lease income associated with the continued growth of the lease portfolio and an increase in gain on sale of assets coming off lease.These were offset by a decrease in consumer and commercial loan fees primarily related to SC for the three-month and six-month periods ended June 30, 2018. |
• | Total general and administrative expenses increased $75.3 million and $171.1 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This increase was primarily due to an increase in lease depreciation expense due to the growth of the Company's leased vehicle portfolio and increases in operational risk and other miscellaneous expenses. These increases were offset by a decrease in compensation and benefits expense for the three-month and six-month periods ended June 30, 2018. |
• | Other expenses decreased $12.6 million and $17.6 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This was primarily due to a decrease in expenses associated with restructuring charges and loss on debt repurchases. |
• | The income tax provision increased $76.1 million and $92.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. There was an increase in the income tax provision as a result of the increase in income before income tax provision and due to the tax benefit recognized during the |
CONSOLIDATED AVERAGE BALANCE SHEET / NET INTEREST MARGIN ANALYSIS | |||||||||||||||||||||||||||||||
THREE-MONTH PERIODS ENDED June 30, 2018 AND 2017 | |||||||||||||||||||||||||||||||
2018 (1) | 2017 (1) | Interest | Change due to | ||||||||||||||||||||||||||||
Average Balance | Interest | Yield/ Rate(2) | Average Balance | Interest | Yield/ Rate(2) | Increase/(Decrease) | Volume | Rate | |||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||
EARNING ASSETS | |||||||||||||||||||||||||||||||
INVESTMENTS AND INTEREST EARNING DEPOSITS | $ | 21,992,405 | $ | 132,750 | 2.41 | % | $ | 26,612,518 | $ | 130,527 | 1.96 | % | $ | 2,223 | $ | (6,893 | ) | $ | 9,116 | ||||||||||||
LOANS(3): | |||||||||||||||||||||||||||||||
Commercial loans | 30,545,599 | 323,748 | 4.24 | % | 33,236,428 | 307,791 | 3.70 | % | 15,957 | (19,879 | ) | 35,836 | |||||||||||||||||||
Multifamily | 8,145,794 | 82,385 | 4.05 | % | 8,337,231 | 81,807 | 3.92 | % | 578 | (1,301 | ) | 1,879 | |||||||||||||||||||
Total commercial loans | 38,691,393 | 406,133 | 4.20 | % | 41,573,659 | 389,598 | 3.75 | % | 16,535 | (21,180 | ) | 37,715 | |||||||||||||||||||
Consumer loans: | |||||||||||||||||||||||||||||||
Residential mortgages | 9,599,348 | 96,997 | 4.04 | % | 8,123,344 | 81,519 | 4.01 | % | 15,478 | 14,867 | 611 | ||||||||||||||||||||
Home equity loans and lines of credit | 5,654,406 | 65,482 | 4.63 | % | 5,929,744 | 57,417 | 3.87 | % | 8,065 | (2,498 | ) | 10,563 | |||||||||||||||||||
Total consumer loans secured by real estate | 15,253,754 | 162,479 | 4.26 | % | 14,053,088 | 138,936 | 3.95 | % | 23,543 | 12,369 | 11,174 | ||||||||||||||||||||
RICs and auto loans | 27,265,842 | 1,084,002 | 15.90 | % | 27,007,022 | 1,169,140 | 17.32 | % | (85,138 | ) | 11,272 | (96,410 | ) | ||||||||||||||||||
Personal unsecured | 2,286,103 | 151,484 | 26.51 | % | 2,427,266 | 155,043 | 25.55 | % | (3,559 | ) | (10,056 | ) | 6,497 | ||||||||||||||||||
Other consumer(4) | 545,404 | 9,755 | 7.15 | % | 716,140 | 16,201 | 9.05 | % | (6,446 | ) | (3,427 | ) | (3,019 | ) | |||||||||||||||||
Total consumer | 45,351,103 | 1,407,720 | 12.42 | % | 44,203,516 | 1,479,320 | 13.39 | % | (71,600 | ) | 10,158 | (81,758 | ) | ||||||||||||||||||
Total loans | 84,042,496 | 1,813,853 | 8.63 | % | 85,777,175 | 1,868,918 | 8.72 | % | (55,065 | ) | (11,022 | ) | (44,043 | ) | |||||||||||||||||
Intercompany investments | 4,640 | 47 | 4.05 | % | 14,640 | 232 | 6.34 | % | (185 | ) | (121 | ) | (64 | ) | |||||||||||||||||
TOTAL EARNING ASSETS | 106,039,541 | 1,946,650 | 7.34 | % | 112,404,333 | 1,999,677 | 7.12 | % | (53,027 | ) | (18,036 | ) | (34,991 | ) | |||||||||||||||||
Allowance for loan losses (5) | (3,840,811 | ) | (3,937,680 | ) | |||||||||||||||||||||||||||
Other assets(6) | 27,745,607 | 26,096,475 | |||||||||||||||||||||||||||||
TOTAL ASSETS | $ | 129,944,337 | $ | 134,563,128 | |||||||||||||||||||||||||||
INTEREST BEARING FUNDING LIABILITIES | |||||||||||||||||||||||||||||||
Deposits and other customer related accounts: | |||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 8,918,715 | $ | 7,863 | 0.35 | % | $ | 10,121,592 | $ | 4,846 | 0.19 | % | $ | 3,017 | $ | (496 | ) | $ | 3,513 | ||||||||||||
Savings | 5,917,881 | 2,933 | 0.20 | % | 6,025,607 | 2,815 | 0.19 | % | 118 | (61 | ) | 179 | |||||||||||||||||||
Money market | 25,441,565 | 62,135 | 0.98 | % | 25,789,677 | 31,675 | 0.49 | % | 30,460 | (417 | ) | 30,877 | |||||||||||||||||||
CDs | 5,663,216 | 19,402 | 1.37 | % | 7,003,835 | 19,488 | 1.11 | % | (86 | ) | (434 | ) | 348 | ||||||||||||||||||
TOTAL INTEREST-BEARING DEPOSITS | 45,941,377 | 92,333 | 0.80 | % | 48,940,711 | 58,824 | 0.48 | % | 33,509 | (1,408 | ) | 34,917 | |||||||||||||||||||
BORROWED FUNDS: | |||||||||||||||||||||||||||||||
FHLB advances, federal funds, and repurchase agreements | 989,011 | 6,894 | 2.79 | % | 4,292,308 | 17,637 | 1.64 | % | (10,743 | ) | (120,933 | ) | 110,190 | ||||||||||||||||||
Other borrowings | 37,895,935 | 309,760 | 3.27 | % | 37,780,229 | 281,235 | 2.98 | % | 28,525 | 870 | 27,655 | ||||||||||||||||||||
TOTAL BORROWED FUNDS (7) | 38,884,946 | 316,654 | 3.26 | % | 42,072,537 | 298,872 | 2.84 | % | 17,782 | (120,063 | ) | 137,845 | |||||||||||||||||||
TOTAL INTEREST-BEARING FUNDING LIABILITIES | 84,826,323 | 408,987 | 1.93 | % | 91,013,248 | 357,696 | 1.57 | % | 51,291 | (121,471 | ) | 172,762 | |||||||||||||||||||
Noninterest bearing demand deposits | 15,315,727 | 15,572,982 | |||||||||||||||||||||||||||||
Other liabilities(8) | 5,503,143 | 4,960,554 | |||||||||||||||||||||||||||||
TOTAL LIABILITIES | 105,645,193 | 111,546,784 | |||||||||||||||||||||||||||||
STOCKHOLDER’S EQUITY | 24,299,144 | 23,016,344 | |||||||||||||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY | $ | 129,944,337 | $ | 134,563,128 | |||||||||||||||||||||||||||
NET INTEREST SPREAD (9) | 5.41 | % | 5.55 | % | |||||||||||||||||||||||||||
NET INTEREST MARGIN (10) | 5.80 | % | 5.84 | % | |||||||||||||||||||||||||||
NET INTEREST INCOME (11) | $ | 1,537,616 | $ | 1,641,749 |
CONSOLIDATED AVERAGE BALANCE SHEET / NET INTEREST MARGIN ANALYSIS | |||||||||||||||||||||||||||||||
SIX-MONTH PERIODS ENDED JUNE 30, 2018 AND 2017 | |||||||||||||||||||||||||||||||
2018 (1) | 2017 (1) | Change due to | |||||||||||||||||||||||||||||
(dollars in thousands) | Average Balance | Interest | Yield/ Rate(2) | Average Balance | Interest | Yield/ Rate(2) | Increase/(Decrease) | Volume | Rate | ||||||||||||||||||||||
EARNING ASSETS | |||||||||||||||||||||||||||||||
INVESTMENTS AND INTEREST EARNING DEPOSITS | $ | 22,315,370 | $ | 261,081 | 2.34 | % | $ | 27,258,866 | $ | 247,182 | 1.81 | % | $ | 13,899 | $ | (22,614 | ) | $ | 36,513 | ||||||||||||
LOANS(3): | |||||||||||||||||||||||||||||||
Commercial loans | 30,507,771 | 629,146 | 4.12 | % | 33,936,472 | 605,400 | 3.57 | % | 23,746 | (45,241 | ) | 68,987 | |||||||||||||||||||
Multifamily | 8,155,884 | 161,618 | 3.96 | % | 8,441,496 | 158,005 | 3.74 | % | 3,613 | (4,892 | ) | 8,505 | |||||||||||||||||||
Total commercial loans | 38,663,655 | 790,764 | 4.09 | % | 42,377,968 | 763,405 | 3.60 | % | 27,359 | (50,133 | ) | 77,492 | |||||||||||||||||||
Consumer loans: | |||||||||||||||||||||||||||||||
Residential mortgages | 9,440,060 | 189,564 | 4.02 | % | 8,141,769 | 162,254 | 3.99 | % | 27,310 | 26,081 | 1,229 | ||||||||||||||||||||
Home equity loans and lines of credit | 5,711,733 | 126,773 | 4.44 | % | 5,949,926 | 111,898 | 3.76 | % | 14,875 | (4,229 | ) | 19,104 | |||||||||||||||||||
Total consumer loans secured by real estate | 15,151,793 | 316,337 | 4.18 | % | 14,091,695 | 274,152 | 3.89 | % | 42,185 | 21,852 | 20,333 | ||||||||||||||||||||
RICs and auto loans | 26,692,304 | 2,122,887 | 15.91 | % | 26,957,954 | 2,318,294 | 17.20 | % | (195,407 | ) | (22,687 | ) | (172,720 | ) | |||||||||||||||||
Personal unsecured | 2,317,612 | 311,321 | 26.87 | % | 2,360,993 | 318,566 | 26.99 | % | (7,245 | ) | (5,834 | ) | (1,411 | ) | |||||||||||||||||
Other consumer(4) | 570,764 | 20,270 | 7.10 | % | 743,321 | 33,439 | 9.00 | % | (13,169 | ) | (6,897 | ) | (6,272 | ) | |||||||||||||||||
Total consumer | 44,732,473 | 2,770,815 | 12.39 | % | 44,153,963 | 2,944,451 | 13.34 | % | (173,636 | ) | (13,566 | ) | (160,070 | ) | |||||||||||||||||
Total loans | 83,396,128 | 3,561,579 | 8.54 | % | 86,531,931 | 3,707,856 | 8.57 | % | (146,277 | ) | (63,699 | ) | (82,578 | ) | |||||||||||||||||
Intercompany investments | 4,640 | 90 | 3.88 | % | 14,640 | 464 | 6.34 | % | (374 | ) | (238 | ) | (136 | ) | |||||||||||||||||
TOTAL EARNING ASSETS | 105,716,138 | 3,822,750 | 7.23 | % | 113,805,437 | 3,955,502 | 6.95 | % | (132,752 | ) | (86,551 | ) | (46,201 | ) | |||||||||||||||||
Allowance for loan losses(5) | (3,871,012 | ) | (3,887,986 | ) | |||||||||||||||||||||||||||
Other assets(6) | 27,824,679 | 26,067,158 | |||||||||||||||||||||||||||||
TOTAL ASSETS | $ | 129,669,805 | $ | 135,984,609 | |||||||||||||||||||||||||||
INTEREST-BEARING FUNDING LIABILITIES | |||||||||||||||||||||||||||||||
Deposits and other customer related accounts: | |||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 9,101,849 | $ | 15,205 | 0.33 | % | $ | 10,482,158 | $ | 10,072 | 0.19 | % | $ | 5,133 | $ | (1,117 | ) | $ | 6,250 | ||||||||||||
Savings | 5,873,931 | 5,556 | 0.19 | % | 6,014,245 | 5,719 | 0.19 | % | (163 | ) | (163 | ) | — | ||||||||||||||||||
Money market | 25,384,655 | 109,886 | 0.87 | % | 25,880,004 | 64,084 | 0.50 | % | 45,802 | (1,218 | ) | 47,020 | |||||||||||||||||||
Certificates of deposit ("CDs") | 5,581,930 | 37,111 | 1.33 | % | 7,699,288 | 40,943 | 1.06 | % | (3,832 | ) | (51,938 | ) | 48,106 | ||||||||||||||||||
TOTAL INTEREST-BEARING DEPOSITS | 45,942,365 | 167,758 | 0.73 | % | 50,075,695 | 120,818 | 0.48 | % | 46,940 | (54,436 | ) | 101,376 | |||||||||||||||||||
BORROWED FUNDS: | |||||||||||||||||||||||||||||||
Federal Home Loan Bank ("FHLB") advances, federal funds, and repurchase agreements | 1,349,724 | 16,475 | 2.44 | % | 4,707,459 | 34,055 | 1.45 | % | (17,580 | ) | (410,846 | ) | 393,266 | ||||||||||||||||||
Other borrowings | 37,603,320 | 604,869 | 3.22 | % | 37,958,104 | 555,852 | 2.93 | % | 49,017 | (5,112 | ) | 54,129 | |||||||||||||||||||
TOTAL BORROWED FUNDS (7) | 38,953,044 | 621,344 | 3.19 | % | 42,665,563 | 589,907 | 2.77 | % | 31,437 | (415,958 | ) | 447,395 | |||||||||||||||||||
TOTAL INTEREST-BEARING FUNDING LIABILITIES | 84,895,409 | 789,102 | 1.86 | % | 92,741,258 | 710,725 | 1.53 | % | 78,377 | (470,394 | ) | 548,771 | |||||||||||||||||||
Noninterest bearing demand deposits | 15,326,602 | 15,504,562 | |||||||||||||||||||||||||||||
Other liabilities(8) | 5,337,348 | 4,889,538 | |||||||||||||||||||||||||||||
TOTAL LIABILITIES | 105,559,359 | 113,135,358 | |||||||||||||||||||||||||||||
STOCKHOLDER’S EQUITY | 24,110,446 | 22,849,251 | |||||||||||||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY | $ | 129,669,805 | $ | 135,984,609 | |||||||||||||||||||||||||||
NET INTEREST SPREAD (9) | 5.37 | % | 5.42 | % | |||||||||||||||||||||||||||
NET INTEREST MARGIN (10) | 5.74 | % | 5.70 | % | |||||||||||||||||||||||||||
NET INTEREST INCOME (11) | $ | 3,033,558 | $ | 3,244,313 |
(1) | Average balances are based on daily averages when available. When daily averages are unavailable, mid-month averages are substituted. |
(2) | Yields calculated using taxable equivalent net interest income. |
(3) | Interest on loans includes amortization of premiums and discounts on purchased loan portfolios and amortization of deferred loan fees, net of origination costs. Average loan balances includes non-accrual loans and loans held for sale ("LHFS"). |
(4) | Other consumer primarily includes recreational vehicle ("RV") and marine loans. |
(5) | Refer to Note 4 to the Condensed Consolidated Financial Statements for further discussion. |
(6) | Other assets primarily includes goodwill and intangibles, premise and equipment, net deferred tax assets, equity method investments, BOLI, accrued interest receivable, derivative assets, miscellaneous receivables, prepaid expenses and mortgage servicing rights ("MSRs"). Refer to Note 8 to the Condensed Consolidated Financial Statements for further discussion. |
(7) | Refer to Note 10 to the Condensed Consolidated Financial Statements for further discussion. |
(8) | Other liabilities primarily includes accounts payable and accrued expenses, derivative liabilities, net deferred tax liabilities and the unfunded lending commitments liability. |
(9) | Represents the difference between the yield on total earning assets and the cost of total funding liabilities. |
(10) | Represents annualized, taxable equivalent net interest income divided by average interest-earning assets. |
(11) | Intercompany investment income is eliminated from this line item. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
INTEREST INCOME: | |||||||||||||||||||||||||||||
Interest-earning deposits | $ | 33,939 | $ | 20,476 | $ | 66,452 | $ | 38,910 | $ | 13,463 | 65.8 | % | $ | 27,542 | 70.8 | % | |||||||||||||
Investments available-for-sale ("AFS") | 77,031 | 95,015 | 150,536 | 176,441 | (17,984 | ) | (18.9 | )% | (25,905 | ) | (14.7 | )% | |||||||||||||||||
Investments held-to-maturity ("HTM") | 17,181 | 10,011 | 34,245 | 20,643 | 7,170 | 71.6 | % | 13,602 | 65.9 | % | |||||||||||||||||||
Other investments | 4,599 | 5,025 | 9,848 | 11,188 | (426 | ) | (8.5 | )% | (1,340 | ) | (12.0 | )% | |||||||||||||||||
Total interest income on investment securities and interest-earning deposits | 132,750 | 130,527 | 261,081 | 247,182 | 2,223 | 1.7 | % | 13,899 | 5.6 | % | |||||||||||||||||||
Interest on loans | 1,813,853 | 1,868,918 | 3,561,579 | 3,707,856 | (55,065 | ) | (2.9 | )% | (146,277 | ) | (3.9 | )% | |||||||||||||||||
Total interest income | 1,946,603 | 1,999,445 | 3,822,660 | 3,955,038 | (52,842 | ) | (2.6 | )% | (132,378 | ) | (3.3 | )% | |||||||||||||||||
INTEREST EXPENSE: | |||||||||||||||||||||||||||||
Deposits and customer accounts | 92,333 | 58,824 | 167,758 | 120,818 | 33,509 | 57.0 | % | 46,940 | 38.9 | % | |||||||||||||||||||
Borrowings and other debt obligations | 316,654 | 298,872 | 621,344 | 589,907 | 17,782 | 5.9 | % | 31,437 | 5.3 | % | |||||||||||||||||||
Total interest expense | 408,987 | 357,696 | 789,102 | 710,725 | 51,291 | 14.3 | % | 78,377 | 11.0 | % | |||||||||||||||||||
NET INTEREST INCOME | $ | 1,537,616 | $ | 1,641,749 | $ | 3,033,558 | $ | 3,244,313 | $ | (104,133 | ) | (6.3 | )% | $ | (210,755 | ) | (6.5 | )% |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||
(in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar | Percentage | Dollar | Percentage | |||||||||||||||||||
ALLL, beginning of period | $ | 3,853,209 | $ | 3,922,863 | $ | 3,911,575 | $ | 3,814,464 | $ | (69,654 | ) | (1.8 | )% | $ | 97,111 | 2.5 | % | ||||||||||
Charge-offs: | |||||||||||||||||||||||||||
Commercial | (16,665 | ) | (60,514 | ) | (49,625 | ) | (86,687 | ) | 43,849 | (72.5 | )% | 37,062 | (42.8 | )% | |||||||||||||
Consumer | (1,036,520 | ) | (1,128,919 | ) | (2,255,456 | ) | (2,366,199 | ) | 92,399 | (8.2 | )% | 110,743 | (4.7 | )% | |||||||||||||
Total charge-offs | (1,053,185 | ) | (1,189,433 | ) | (2,305,081 | ) | (2,452,886 | ) | 136,248 | (11.5 | )% | 147,805 | (6.0 | )% | |||||||||||||
Recoveries: | |||||||||||||||||||||||||||
Commercial | 14,624 | 9,056 | 24,629 | 19,635 | 5,568 | 61.5 | % | 4,994 | 25.4 | % | |||||||||||||||||
Consumer | 613,359 | 599,437 | 1,275,105 | 1,223,374 | 13,922 | 2.3 | % | 51,731 | 4.2 | % | |||||||||||||||||
Total recoveries | 627,983 | 608,493 | 1,299,734 | 1,243,009 | 19,490 | 3.2 | % | 56,725 | 4.6 | % | |||||||||||||||||
Charge-offs, net of recoveries | (425,202 | ) | (580,940 | ) | (1,005,347 | ) | (1,209,877 | ) | 155,738 | (26.8 | )% | 204,530 | (16.9 | )% | |||||||||||||
Provision for loan and lease losses (1) | 382,727 | 611,685 | 904,506 | 1,349,021 | (228,958 | ) | (37.4 | )% | (444,515 | ) | (33.0 | )% | |||||||||||||||
ALLL, end of period | $ | 3,810,734 | $ | 3,953,608 | $ | 3,810,734 | $ | 3,953,608 | $ | (142,874 | ) | (3.6 | )% | $ | (142,874 | ) | (3.6 | )% | |||||||||
Reserve for unfunded lending commitments, beginning of period | $ | 89,866 | $ | 120,396 | $ | 109,111 | $ | 122,419 | $ | (30,530 | ) | (25.4 | )% | $ | (13,308 | ) | (10.9 | )% | |||||||||
Release of reserves for unfunded lending commitments (1) | (2,893 | ) | (6,917 | ) | (22,138 | ) | (8,807 | ) | 4,024 | (58.2 | )% | (13,331 | ) | 151.4 | % | ||||||||||||
Loss on unfunded lending commitments | — | (1,668 | ) | — | (1,801 | ) | 1,668 | (100.0 | )% | 1,801 | (100.0 | )% | |||||||||||||||
Reserve for unfunded lending commitments, end of period | 86,973 | 111,811 | 86,973 | 111,811 | (24,838 | ) | (22.2 | )% | (24,838 | ) | (22.2 | )% | |||||||||||||||
Total allowance for credit losses ("ACL"), end of period | $ | 3,897,707 | $ | 4,065,419 | $ | 3,897,707 | $ | 4,065,419 | $ | (167,712 | ) | (4.1 | )% | $ | (167,712 | ) | (4.1 | )% |
(1) | The provision for credit losses in the Condensed Consolidated Statement of Operations is the sum of the total provision for loan and lease losses and the provision for unfunded lending commitments. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | |||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | ||||||||||||||||||||||
Consumer fees | $ | 96,846 | $ | 120,047 | $ | 199,745 | $ | 232,113 | $ | (23,201 | ) | (19.3 | )% | $ | (32,368 | ) | (13.9 | )% | ||||||||||||
Commercial fees | 39,319 | 42,287 | 76,592 | 84,589 | (2,968 | ) | (7.0 | )% | (7,997 | ) | (9.5 | )% | ||||||||||||||||||
Lease income | 569,306 | 489,043 | 1,110,202 | 985,087 | 80,263 | 16.4 | % | 125,115 | 12.7 | % | ||||||||||||||||||||
Miscellaneous income | 113,283 | 69,383 | 234,085 | 144,526 | 43,900 | 63.3 | % | 89,559 | 62.0 | % | ||||||||||||||||||||
Net (losses)/gains recognized in earnings | 419 | 9,049 | (244 | ) | 9,569 | (8,630 | ) | (95.4 | )% | (9,813 | ) | (102.5 | )% | |||||||||||||||||
Total non-interest income | $ | 819,173 | $ | 729,809 | $ | 1,620,380 | $ | 1,455,884 | $ | 89,364 | 12.2 | % | $ | 164,496 | 11.3 | % |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | |||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | ||||||||||||||||||||||
Mortgage banking income, net | 2,933 | 15,092 | 19,278 | 28,266 | (12,159 | ) | (80.6 | )% | (8,988 | ) | (31.8 | )% | ||||||||||||||||||
BOLI | 14,816 | 14,052 | 29,384 | 31,351 | 764 | 5.4 | % | (1,967 | ) | (6.3 | )% | |||||||||||||||||||
Capital market revenue | 41,083 | 39,771 | 97,696 | 85,587 | 1,312 | 3.3 | % | 12,109 | 14.1 | % | ||||||||||||||||||||
Net gain on sale of operating leases | 65,742 | 39,810 | 118,941 | 62,525 | 25,932 | 65.1 | % | 56,416 | 90.2 | % | ||||||||||||||||||||
Asset and wealth management fees | 43,922 | 39,438 | 87,259 | 75,939 | 4,484 | 11.4 | % | 11,320 | 14.9 | % | ||||||||||||||||||||
Loss on sale of non-mortgage loans | (74,872 | ) | (87,837 | ) | (118,782 | ) | (157,604 | ) | 12,965 | (14.8 | )% | 38,822 | (24.6 | )% | ||||||||||||||||
Other miscellaneous income, net | 19,659 | 9,057 | 309 | 18,462 | 10,602 | 117.1 | % | (18,153 | ) | (98.3 | )% | |||||||||||||||||||
Total miscellaneous income/(loss) | $ | 113,283 | $ | 69,383 | $ | 234,085 | $ | 144,526 | $ | 43,900 | 63.3 | % | $ | 89,559 | 62.0 | % |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | |||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | ||||||||||||||||||||||
Mortgage and multifamily servicing fees | $ | 9,769 | $ | 10,452 | $ | 19,963 | $ | 21,076 | $ | (683 | ) | (6.5 | )% | $ | (1,113 | ) | (5.3 | )% | ||||||||||||
Net gains on sales of residential mortgage loans and related securities | 2,329 | 1,324 | 8,553 | 5,676 | 1,005 | 75.9 | % | 2,877 | 50.7 | % | ||||||||||||||||||||
Net gains on sales of multifamily mortgage loans | (2,712 | ) | 900 | (2,312 | ) | 1,200 | (3,612 | ) | (401.3 | )% | (3,512 | ) | (292.7 | )% | ||||||||||||||||
Net gains/(losses) on hedging activities | (1,739 | ) | 8,900 | (13,367 | ) | 9,946 | (10,639 | ) | (119.5 | )% | (23,313 | ) | (234.4 | )% | ||||||||||||||||
Net gains/(losses) from changes in MSR fair value | (1,274 | ) | (1,193 | ) | 13,769 | 263 | (81 | ) | 6.8 | % | 13,506 | 5,135.4 | % | |||||||||||||||||
MSR principal reductions | (3,440 | ) | (5,291 | ) | (7,328 | ) | (9,895 | ) | 1,851 | (35.0 | )% | 2,567 | (25.9 | )% | ||||||||||||||||
Total mortgage banking income, net | $ | 2,933 | $ | 15,092 | $ | 19,278 | $ | 28,266 | $ | (12,159 | ) | (80.6 | )% | $ | (8,988 | ) | (31.8 | )% |
30-Year Fixed | 15-Year Fixed | ||||
December 31, 2016 | 4.38 | % | 3.63 | % | |
March 31, 2017 | 4.25 | % | 3.50 | % | |
June 30, 2017 | 4.13 | % | 3.38 | % | |
September 30, 2017 | 3.99 | % | 3.25 | % | |
December 31, 2017 | 4.13 | % | 3.63 | % | |
March 31, 2018 | 4.50 | % | 3.99 | % | |
June 30, 2018 | 4.63 | % | 4.13 | % |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar | Percentage | |||||||||||||||||||||
Compensation and benefits | $ | 427,728 | $ | 455,616 | $ | 896,505 | $ | 907,857 | $ | (27,888 | ) | (6.1 | )% | $ | (11,352 | ) | (1.3 | )% | |||||||||||
Occupancy and equipment expenses | 163,171 | 163,553 | 322,511 | 326,264 | (382 | ) | (0.2 | )% | (3,753 | ) | (1.2 | )% | |||||||||||||||||
Technology, outside services, and marketing expense | 156,010 | 162,259 | 308,292 | 297,771 | (6,249 | ) | (3.9 | )% | 10,521 | 3.5 | % | ||||||||||||||||||
Loan expense | 97,679 | 95,872 | 194,493 | 194,217 | 1,807 | 1.9 | % | 276 | 0.1 | % | |||||||||||||||||||
Lease expense | 436,795 | 369,240 | 861,061 | 728,032 | 67,555 | 18.3 | % | 133,029 | 18.3 | % | |||||||||||||||||||
Other administrative expenses | 135,565 | 95,096 | 239,746 | 197,334 | 40,469 | 42.6 | % | 42,412 | 21.5 | % | |||||||||||||||||||
Total general and administrative expenses | $ | 1,416,948 | $ | 1,341,636 | $ | 2,822,608 | $ | 2,651,475 | $ | 75,312 | 5.6 | % | $ | 171,133 | 6.5 | % |
• | Compensation and benefits expense decreased $27.9 million and $11.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These decreases were primarily the result of bonus expense decreasing $20.9 million and $12.5 million and other compensation and benefits decreasing $11.5 million and $31.5 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These decreases were offset by increases in salary expense of $12.0 million and $30.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The decrease in bonus and other compensation and benefits expense relates to decreases in bonus true-ups and a reduction in capitalized software development costs during the comparative periods. The increase in salary expense primarily relates to merit increases and an increase in employees. |
• | Occupancy and equipment expenses decreased $0.4 million and $3.8 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This was primarily due to a decrease in depreciation expense of $6.9 million and $9.3 million for the three-month and six-month periods ended June 30, 2018, respectively. The decrease in depreciation expense primarily related to depreciation on capitalized software assets, due to more disposals in the prior corresponding periods and minimal additions for the three-month and six-month periods ended June 30, 2018. These decreases were offset by an increase of $4.0 million and $5.8 million in maintenance and repair expense for the three-month and six-month periods ended June 30, 2018 compared to the corresponding periods in 2017. |
• | Technology, outside services, and marketing expenses decreased $6.2 million and increased $10.5 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. Technology service expenses increased $7.2 million and $25.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The increase relates to higher costs to IT vendors related to various initiatives. This was offset by decreases of $13.9 million and $15.0 million in marketing expenses for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These decreases were primarily due to decreases in expenses such as direct mail, advertising and outside marketing associated with corporate marketing campaigns. |
• | Loan expense increased $1.8 million and $0.3 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These increases were primarily due to increases of $6.4 million and $4.5 million in loan servicing expenses and $3.0 million and $3.4 million in loan origination expenses for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The increases were offset by decreases in collection expense of $5.0 million and $3.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
• | Lease expense increased $67.6 million and $133.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods 2017. These increases were primarily due to the continued growth of the Company's leased vehicle portfolio and depreciation associated with that portfolio. |
• | Other administrative expenses increased $40.5 million and $42.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This increase was primarily attributable to an increase in operational risk expenses of $17.6 million and $25.7 million and miscellaneous expenses of $15.6 million and $17.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These increases were offset by a decrease in legal expense of $4.3 million and $9.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017 |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar (decrease)/increase | Percentage | Dollar (decrease)/increase | Percentage | |||||||||||||||||||||
Amortization of intangibles | $ | 15,288 | $ | 15,424 | $ | 30,576 | $ | 30,915 | $ | (136 | ) | (0.9 | )% | $ | (339 | ) | (1.1 | )% | |||||||||||
Deposit insurance premiums and other expenses | 14,804 | 17,596 | 31,564 | 35,426 | (2,792 | ) | (15.9 | )% | (3,862 | ) | (10.9 | )% | |||||||||||||||||
Loss on debt extinguishment | 1,201 | 3,991 | 3,413 | 10,740 | (2,790 | ) | (69.9 | )% | (7,327 | ) | (68.2 | )% | |||||||||||||||||
Other miscellaneous expenses | 1,508 | 8,397 | 2,946 | 9,035 | (6,889 | ) | (82.0 | )% | (6,089 | ) | (67.4 | )% | |||||||||||||||||
Total other expenses | $ | 32,801 | $ | 45,408 | $ | 68,499 | $ | 86,116 | $ | (12,607 | ) | (27.8 | )% | $ | (17,617 | ) | (20.5 | )% |
• | Amortization of intangibles decreased $0.1 million and $0.3 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
• | Deposit insurance premiums and other expenses decreased $2.8 million and $3.9 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This decrease was primarily attributable to decreases in FDIC assessment rates as well as a decrease in the FDIC assessment base. |
• | Losses on debt extinguishment decreased $2.8 million and $7.3 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The Company recorded loss on debt extinguishment related to tender offers on Bank debt of $1.2 million and $3.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to $4.0 million and $10.7 million, for the three-month and six-month periods ended June 30, 2017. Non-recurring activity of a $4 million charge on the buy-back of real estate investment trust preferred stock for the three-month ended and a tender offer on bank debt resulted in a charge of $6.7 million during the six-month period ended June 30, 2017. |
• | Other miscellaneous expenses decreased $6.9 million and $6.1 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These decreases were primarily related to restructuring charges during the comparative periods. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
Net interest income | $ | 316,223 | $ | 277,069 | $ | 621,045 | $ | 539,800 | $ | 39,154 | 14.1 | % | $ | 81,245 | 15.1 | % | |||||||||||||
Total non-interest income | 69,647 | 94,285 | 152,465 | 176,819 | (24,638 | ) | (26.1 | )% | (24,354 | ) | (13.8 | )% | |||||||||||||||||
Provision for credit losses | 18,283 | 21,410 | 56,672 | 43,861 | (3,127 | ) | (14.6 | )% | 12,811 | 29.2 | % | ||||||||||||||||||
Total expenses | 367,235 | 381,844 | 738,303 | 756,864 | (14,609 | ) | (3.8 | )% | (18,561 | ) | (2.5 | )% | |||||||||||||||||
Income/(loss) before income taxes | 352 | (31,900 | ) | (21,465 | ) | (84,106 | ) | 32,252 | 101.1 | % | 62,641 | 74.5 | % | ||||||||||||||||
Intersegment revenue | 521 | 329 | 1,198 | 1,206 | 192 | 58.4 | % | (8 | ) | (0.7 | )% | ||||||||||||||||||
Total assets | 19,088,997 | 18,077,481 | 19,088,997 | 18,077,481 | 1,011,516 | 5.6 | % | 1,011,516 | 5.6 | % |
• | Net interest income increased $39.2 million and $81.2 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These increases were primarily driven by deposit product margin due to interest rate increases partially offset by increased cost of deposits. |
• | Total non-interest income decreased $24.6 million and $24.4 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017 driven by a change made in the second quarter of 2017 in the shared services agreement between the Bank and SSLLC, and also by non-recurring gains on sale from the of branches in Brooklyn, NY in 2017. |
• | The provision for credit losses decreased $3.1 million and increased $12.8 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The decrease for the three-month period reflects the reserve releases related to TDR portfolio in the month of June 2018. However, the increase of the provision for credit losses in the six-month period was driven by reserve releases in 2017 for home equity offset by reserve increases in 2018 for consumer loan portfolios to reflect the current upward trend of delinquencies. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
Net interest income | $ | 160,824 | $ | 162,953 | $ | 315,759 | $ | 315,259 | $ | (2,129 | ) | (1.3 | )% | $ | 500 | 0.2 | % | ||||||||||||
Total non-interest income | 16,120 | 18,858 | 49,708 | 33,781 | (2,738 | ) | (14.5 | )% | 15,927 | 47.1 | % | ||||||||||||||||||
(Release of) /provision for credit losses | (13,001 | ) | (1,089 | ) | (22,742 | ) | 4,297 | (11,912 | ) | (1,093.8 | )% | (27,039 | ) | (629.3 | )% | ||||||||||||||
Total expenses | 84,769 | 78,753 | 167,407 | 157,092 | 6,016 | 7.6 | % | 10,315 | 6.6 | % | |||||||||||||||||||
Income before income taxes | 105,176 | 104,147 | 220,802 | 187,651 | 1,029 | 1.0 | % | 33,151 | 17.7 | % | |||||||||||||||||||
Intersegment revenue | 2,562 | 1,750 | 4,093 | 3,052 | 812 | 46.4 | % | 1,041 | 34.1 | % | |||||||||||||||||||
Total assets | 25,124,793 | 25,776,884 | 25,124,793 | 25,776,884 | (652,091 | ) | (2.5 | )% | (652,091 | ) | (2.5 | )% |
• | Net interest income decreased $2.1 million and increased $0.5 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. Total average gross loans were $24.6 billion and $24.8 billion for the three-month and six-month periods ended June 30, 2018, respectively, compared to $25.8 billion and $25.9 billion for the corresponding periods in 2017. The decline in average gross loans is primarily related to the sale of the Mortgage Warehouse portfolio in March and decreases in the Real Estate and Energy Lending portfolios, partially offset by an increase in the C&I portfolio. |
• | The provision for credit losses decreased $11.9 million and decreased $27.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The decrease in provision for the three-month and six-month periods ended June 30, 2018 was due to releases totaling $6.2 million for the Mortgage Warehouse portfolio, $11.3 million in Energy Lending, $8.1 million in Asset Based Lending, as well as other general releases. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
Net interest income | $ | 30,901 | $ | 40,860 | $ | 63,591 | $ | 83,088 | $ | (9,959 | ) | (24.4 | )% | $ | (19,497 | ) | (23.5 | )% | |||||||||||
Total non-interest income | 64,740 | 42,375 | 115,378 | 93,711 | 22,365 | 52.8 | % | 21,667 | 23.1 | % | |||||||||||||||||||
(Release of) /provision for credit losses | 3,764 | 13,635 | 1,709 | 12,271 | (9,871 | ) | (72.4 | )% | (10,562 | ) | (86.1 | )% | |||||||||||||||||
Total expenses | 58,507 | 59,454 | 116,574 | 106,062 | (947 | ) | (1.6 | )% | 10,512 | 9.9 | % | ||||||||||||||||||
Income before income taxes | 33,370 | 10,146 | 60,686 | 58,466 | 23,224 | 228.9 | % | 2,220 | 3.8 | % | |||||||||||||||||||
Intersegment expense | (3,527 | ) | (2,089 | ) | (5,808 | ) | (4,486 | ) | (1,438 | ) | (68.8 | )% | (1,322 | ) | (29.5 | )% | |||||||||||||
Total assets | 7,832,197 | 8,949,566 | 7,832,197 | 8,949,566 | (1,117,369 | ) | (12.5 | )% | (1,117,369 | ) | (12.5 | )% |
• | Net interest income decreased $10.0 million and $19.5 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The average balance of this segment's gross loans was $4.9 billion and $4.7 billion for the three-month and six-month periods ended June 30, 2018, respectively, |
• | Total non-interest income increased $22.4 million and $21.7 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
• | The provision for credit losses decreased $9.9 million and $10.6 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. The provision decreased for the six-month period ended June 30, 2018 due to higher reserves required for oil and gas clients and higher reserves on a renewable energy investment that was substantially damaged by Hurricane Maria in 2017. |
• | Total expenses decreased $0.9 million and increased $10.5 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017, driven by higher support and personnel expenses. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
Net interest income | $ | 66,267 | $ | 65,273 | $ | 129,070 | $ | 122,000 | $ | 994 | 1.5 | % | $ | 7,070 | 5.8 | % | |||||||||||||
Total non-interest income | 110,271 | 155,855 | 221,540 | 304,619 | (45,584 | ) | (29.2 | )% | (83,079 | ) | (27.3 | )% | |||||||||||||||||
Provision for credit losses | 8,621 | 16,051 | 14,958 | 31,663 | (7,430 | ) | (46.3 | )% | (16,705 | ) | (52.8 | )% | |||||||||||||||||
Total expenses | 217,368 | 244,249 | 442,975 | 467,939 | (26,881 | ) | (11.0 | )% | (24,964 | ) | (5.3 | )% | |||||||||||||||||
Loss before income taxes | (49,451 | ) | (39,172 | ) | (107,323 | ) | (72,983 | ) | (10,279 | ) | (26.2 | )% | (34,340 | ) | (47.1 | )% | |||||||||||||
Intersegment revenue/(expense) | 444 | 10 | 517 | 228 | 434 | 4,340.0 | % | 289 | 126.8 | % | |||||||||||||||||||
Total assets | 36,919,571 | 42,444,282 | 36,919,571 | 42,444,282 | (5,524,711 | ) | (13.0 | )% | (5,524,711 | ) | (13.0 | )% |
• | Net interest income increased $1.0 million and $7.1 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
• | Total non-interest income decreased $45.6 million and $83.1 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
• | The provision for credit losses decreased $7.4 million and $16.7 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
• | Total expenses decreased $26.9 million and $25.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. |
Three-Month Period Ended June 30, | Six-Month Period Ended June 30, | QTD Change | YTD Change | ||||||||||||||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | Dollar increase/(decrease) | Percentage | Dollar increase/(decrease) | Percentage | |||||||||||||||||||||
Net interest income | $ | 946,572 | $ | 1,053,673 | $ | 1,868,311 | $ | 2,096,600 | $ | (107,101 | ) | (10.2 | )% | $ | (228,289 | ) | (10.9 | )% | |||||||||||
Total non-interest income | 567,693 | 432,373 | 1,099,429 | 867,221 | 135,320 | 31.3 | % | 232,208 | 26.8 | % | |||||||||||||||||||
Provision for credit losses | 352,575 | 520,555 | 811,570 | 1,155,568 | (167,980 | ) | (32.3 | )% | (343,998 | ) | (29.8 | )% | |||||||||||||||||
Total expenses | 713,045 | 617,383 | 1,407,915 | 1,238,717 | 95,662 | 15.5 | % | 169,198 | 13.7 | % | |||||||||||||||||||
Income before income taxes | 448,645 | 348,108 | 748,255 | 569,536 | 100,537 | 28.9 | % | 178,719 | 31.4 | % | |||||||||||||||||||
Intersegment revenue | — | — | — | — | — | 0% | — | 0.0% | |||||||||||||||||||||
Total assets | 41,173,136 | 39,507,482 | 41,173,136 | 39,507,482 | 1,665,654 | 4.2 | % | 1,665,654 | 4.2 | % |
• | Net interest income decreased $107.1 million and $228.3 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. These decreases were primarily related to an increase in interest expense during the periods. SC's cost of funds increased during the three- and six-month periods ended June 30, 2018 compared to the corresponding periods in 2017 due to higher market rates and increased spreads. In addition, net interest income decreased due a decline in the average outstanding balance of the RIC portfolio in 2018 compared to 2017. |
• | Total non-interest income increased $135.3 million and $232.2 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017, due to the continued growth in the operating lease vehicle portfolio since SC launched Chrysler Capital in 2013. |
• | The provision for credit losses decreased $168.0 million and $344.0 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017. This decrease was primarily due to lower net charge offs during the three-month and six-month periods ended June 30, 2018 compared to the corresponding periods in 2017. |
• | Total expenses increased $95.7 million and $169.2 million for the three-month and six-month periods ended June 30, 2018, respectively, compared to the corresponding periods in 2017, primarily due to the continued growth in the operating lease vehicle portfolio since SC launched Chrysler Capital in 2013. |
June 30, 2018 | December 31, 2017 | June 30, 2017 | |||||||||||||||||||
(dollars in thousands) | Amount | Percent | Amount | Percent | Amount | Percent | |||||||||||||||
Commercial LHFI: | |||||||||||||||||||||
Commercial real estate loans | $ | 9,053,402 | 10.9 | % | $ | 9,279,225 | 11.5 | % | $ | 9,799,724 | 11.8 | % | |||||||||
Commercial and industrial loans | 14,695,706 | 17.7 | % | 14,438,311 | 17.9 | % | 16,129,649 | 19.4 | % | ||||||||||||
Multifamily | 8,323,925 | 10.0 | % | 8,274,435 | 10.1 | % | 8,240,516 | 9.9 | % | ||||||||||||
Other commercial | 7,466,771 | 9.0 | % | 7,174,739 | 8.9 | % | 6,902,989 | 8.4 | % | ||||||||||||
Total Commercial Loans (1) | 39,539,804 | 47.6 | % | 39,166,710 | 48.4 | % | 41,072,878 | 49.5 | % | ||||||||||||
Consumer loans secured by real estate: | |||||||||||||||||||||
Residential mortgages | 9,464,713 | 11.4 | % | 8,846,765 | 11.0 | % | 8,040,363 | 9.7 | % | ||||||||||||
Home equity loans and lines of credit | 5,682,230 | 6.8 | % | 5,907,733 | 7.3 | % | 5,903,913 | 7.1 | % | ||||||||||||
Total consumer loans secured by real estate | 15,146,943 | 18.2 | % | 14,754,498 | 18.3 | % | 13,944,276 | 16.8 | % | ||||||||||||
Consumer loans not secured by real estate: | |||||||||||||||||||||
RICs and auto loans - originated | 25,404,300 | 30.6 | % | 23,081,424 | 28.6 | % | 23,466,768 | 28.3 | % | ||||||||||||
RICs and auto loans - purchased | 1,246,606 | 1.5 | % | 1,834,868 | 2.3 | % | 2,554,220 | 3.1 | % | ||||||||||||
Total RICs and auto loans | 26,650,906 | 32.1 | % | 24,916,292 | 30.9 | % | 26,020,988 | 31.4 | % | ||||||||||||
Personal unsecured loans | 1,277,301 | 1.5 | % | 1,285,677 | 1.6 | % | 1,229,497 | 1.5 | % | ||||||||||||
Other consumer | 521,950 | 0.6 | % | 617,675 | 0.8 | % | 689,140 | 0.8 | % | ||||||||||||
Total consumer loans | 43,597,100 | 52.4 | % | 41,574,142 | 51.6 | % | 41,883,901 | 50.5 | % | ||||||||||||
Total LHFI | $ | 83,136,904 | 100.0 | % | $ | 80,740,852 | 100.0 | % | $ | 82,956,779 | 100.0 | % | |||||||||
Total LHFI with: | |||||||||||||||||||||
Fixed | $ | 52,903,597 | 63.6 | % | $ | 50,653,790 | 62.7 | % | $ | 50,623,536 | 61.0 | % | |||||||||
Variable | 30,233,307 | 36.4 | % | 30,087,062 | 37.3 | % | 32,333,243 | 39.0 | % | ||||||||||||
Total LHFI | $ | 83,136,904 | 100.0 | % | $ | 80,740,852 | 100.0 | % | $ | 82,956,779 | 100.0 | % |
At June 30, 2018, Maturing | ||||||||||||||||
(in thousands) | In One Year Or Less | One to Five Years | After Five Years | Total(1) | ||||||||||||
CRE loans | $ | 2,284,651 | $ | 5,299,622 | $ | 1,469,129 | $ | 9,053,402 | ||||||||
Commercial and industrial loans and other | 9,107,096 | 11,236,436 | 1,884,473 | 22,228,005 | ||||||||||||
Multifamily loans | 728,804 | 6,284,777 | 1,310,344 | 8,323,925 | ||||||||||||
Total | $ | 12,120,551 | $ | 22,820,835 | $ | 4,663,946 | $ | 39,605,332 | ||||||||
Loans with: | ||||||||||||||||
Fixed rates | $ | 3,382,812 | $ | 11,315,772 | $ | 2,423,417 | $ | 17,122,001 | ||||||||
Variable rates | 8,737,739 | 11,505,063 | 2,240,529 | 22,483,331 | ||||||||||||
Total | $ | 12,120,551 | $ | 22,820,835 | $ | 4,663,946 | $ | 39,605,332 |
Period Ended | Change | ||||||||||||||
(dollars in thousands) | June 30, 2018 | December 31, 2017 | Dollar | Percentage | |||||||||||
Non-accrual loans: | |||||||||||||||
Commercial: | |||||||||||||||
CRE | $ | 123,305 | $ | 139,236 | $ | (15,931 | ) | (11.4 | )% | ||||||
Commercial and industrial loans | 162,134 | 230,481 | (68,347 | ) | (29.7 | )% | |||||||||
Multifamily | 28,501 | 11,348 | 17,153 | 151.2 | % | ||||||||||
Other commercial | 77,052 | 83,468 | (6,416 | ) | (7.7 | )% | |||||||||
Total commercial loans | 390,992 | 464,533 | (73,541 | ) | (15.8 | )% | |||||||||
Consumer loans secured by real estate: | |||||||||||||||
Residential mortgages | 241,886 | 265,436 | (23,550 | ) | (8.9 | )% | |||||||||
Home equity loans and lines of credit | 125,834 | 134,162 | (8,328 | ) | (6.2 | )% | |||||||||
Consumer loans not secured by real estate: | |||||||||||||||
RICs and auto loans - originated | 1,924,294 | 1,816,226 | 108,068 | 6.0 | % | ||||||||||
RICs - purchased | 203,346 | 256,617 | (53,271 | ) | (20.8 | )% | |||||||||
Total RICs and Auto loans | 2,127,640 | 2,072,843 | 54,797 | 2.6 | % | ||||||||||
Personal unsecured loans | 7,035 | 2,366 | 4,669 | 197.3 | % | ||||||||||
Other consumer | 8,570 | 10,657 | (2,087 | ) | (19.6 | )% | |||||||||
Total consumer loans | 2,510,965 | 2,485,464 | 25,501 | 1.0 | % | ||||||||||
Total non-accrual loans | 2,901,957 | 2,949,997 | (48,040 | ) | (1.6 | )% | |||||||||
Other real estate owned | 118,502 | 130,777 | (12,275 | ) | (9.4 | )% | |||||||||
Repossessed vehicles | 147,430 | 210,692 | (63,262 | ) | (30.0 | )% | |||||||||
Other repossessed assets | 1,212 | 2,190 | (978 | ) | (44.7 | )% | |||||||||
Total other real estate owned ("OREO") and other repossessed assets | 267,144 | 343,659 | (76,515 | ) | (22.3 | )% | |||||||||
Total non-performing assets | $ | 3,169,101 | $ | 3,293,656 | $ | (124,555 | ) | (3.8 | )% | ||||||
Past due 90 days or more as to interest or principal and accruing interest | $ | 88,162 | $ | 96,461 | n/a | n/a | |||||||||
Annualized net loan charge-offs to average loans (1) | 2.4 | % | 3.0 | % | n/a | n/a | |||||||||
Non-performing assets as a percentage of total assets | 2.4 | % | 2.6 | % | n/a | n/a | |||||||||
NPLs as a percentage of total loans | 3.4 | % | 3.5 | % | n/a | n/a | |||||||||
ALLL as a percentage of total NPLs | 131.3 | % | 132.6 | % | n/a | n/a |
June 30, 2018 | December 31, 2017 | |||||||||||||||
(dollars in thousands) | Residential mortgages | Home equity loans and lines of credit | Residential mortgages | Home equity loans and lines of credit | ||||||||||||
NPLs | $ | 241,886 | $ | 125,834 | $ | 265,436 | $ | 134,162 | ||||||||
Total LHFI | 9,464,713 | 5,682,230 | 8,846,765 | 5,907,733 | ||||||||||||
NPLs as a percentage of total LHFI | 2.6 | % | 2.2 | % | 3.0 | % | 2.3 | % | ||||||||
NPLs in foreclosure status | 43.2 | % | 51.5 | % | 48.8 | % | 52.2 | % |
June 30, 2018 | December 31, 2017 | |||
Puerto Rico | 58.0% | 53.5% | ||
New Jersey | 10.2% | 13.7% | ||
New York | 8.8% | 6.4% | ||
Pennsylvania | 4.9% | 10.9% | ||
Massachusetts | 8.3% | 5.8% | ||
All other states(1) | 9.8% | 9.7% |
(dollars in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Alt-A loans | $ | 349,054 | $ | 386,412 | ||||
Alt-A loans as a percentage of the residential mortgage portfolio(1) | 3.6 | % | 4.3 | % | ||||
Alt-A loans in NPL status | $ | 24,421 | $ | 33,534 | ||||
Alt-A loans in NPL status as a percentage of residential mortgage NPLs | 10.1 | % | 12.6 | % |
(1) | Includes residential mortgage held for sale. |
June 30, 2018 | December 31, 2017 | |||||||||||
(dollars in thousands) | Consumer Loans Secured by Real Estate | RICs and auto loans | Personal unsecured and Other Consumer Loans | Commercial Loans | Total | Consumer Loans Secured by Real Estate | RICs and auto loans | Personal unsecured and Other Consumer Loans | Commercial Loans | Total | ||
Total delinquencies | $509,364 | $3,590,357 | $216,637 | $285,219 | $4,601,577 | $571,229 | $4,225,517 | $229,547 | $295,138 | $5,321,431 | ||
Total loans(1) | $15,404,646 | $26,931,019 | $2,755,706 | $39,605,332 | $84,696,703 | $14,964,668 | $26,017,340 | $2,965,442 | $39,315,888 | $83,263,338 | ||
Delinquencies as a % of loans | 3.3% | 13.3% | 7.9% | 0.7% | 5.4% | 3.8% | 16.2% | 7.7% | 0.8% | 6.4% |
(1) | Includes LHFS. |
As of June 30, 2018 | ||||||||||||||||||||||||||||
(in thousands) | Commercial | % | Consumer loans secured by real estate | % | RICs and auto loans | % | Other consumer | % | Total TDRs | |||||||||||||||||||
Performing | $ | 149,934 | 51.8 | % | $ | 275,411 | 71.2 | % | $ | 5,261,972 | 91.1 | % | $ | 121,983 | 75.5 | % | $ | 5,809,300 | ||||||||||
Non-performing | 139,702 | 48.2 | % | 111,333 | 28.8 | % | 513,330 | 8.9 | % | 39,641 | 24.5 | % | 804,006 | |||||||||||||||
Total | $ | 289,636 | 100.0 | % | $ | 386,744 | 100.0 | % | $ | 5,775,302 | 100.0 | % | $ | 161,624 | 100.0 | % | $ | 6,613,306 | ||||||||||
% of loan portfolio | 0.7 | % | n/a | 2.5 | % | n/a | 21.4 | % | n/a | 5.9 | % | n/a | 7.8 | % | ||||||||||||||
(1) Includes LHFS | ||||||||||||||||||||||||||||
As of December 31, 2017 | ||||||||||||||||||||||||||||
(in thousands) | Commercial | % | Consumer loans secured by real estate | % | RICs and auto loans | % | Other consumer | % | Total TDRs | |||||||||||||||||||
Performing | $ | 146,808 | 54.4 | % | $ | 292,634 | 70.8 | % | $ | 5,270,507 | 88.3 | % | $ | 114,355 | 74.7 | % | $ | 5,824,304 | ||||||||||
Non-performing | 123,266 | 45.6 | % | 120,458 | 29.2 | % | 700,461 | 11.7 | % | 38,683 | 25.3 | % | 982,868 | |||||||||||||||
Total | $ | 270,074 | 100.0 | % | $ | 413,092 | 100.0 | % | $ | 5,970,968 | 100.0 | % | $ | 153,038 | 100.0 | % | $ | 6,807,172 | ||||||||||
% of loan portfolio | 0.7 | % | n/a | 2.8 | % | n/a | 22.9 | % | n/a | 5.2 | % | n/a | 8.2 | % |
Six-Month Period Ended June 30, 2018 | Six-Month Period Ended June 30, 2017 | |||||||||||||||
(in thousands) | RICs and auto loans | All other loans | RICs and auto loans | All other loans(1) | ||||||||||||
TDRs, beginning of period | $ | 5,975,512 | $ | 831,660 | $ | 5,161,935 | $ | 944,981 | ||||||||
New TDRs(1) | 283,688 | 82,000 | 2,062,608 | 163,156 | ||||||||||||
Charged-Off TDRs | (311,758 | ) | (7,088 | ) | (1,091,066 | ) | (132,541 | ) | ||||||||
Sold TDRs | — | — | — | (7,252 | ) | |||||||||||
Payments on TDRs | (172,140 | ) | (68,568 | ) | (556,121 | ) | (24,222 | ) | ||||||||
TDRs, end of period | $ | 5,775,302 | $ | 838,004 | $ | 5,577,356 | $ | 944,122 |
(1) | New TDRs includes drawdowns on lines of credit that have previously been classified as TDRs. |
June 30, 2018 | December 31, 2017 | |||||||||||||
(dollars in thousands) | Amount | % of Loans to Total LHFI | Amount | % of Loans to Total LHFI | ||||||||||
Allocated allowance: | ||||||||||||||
Commercial loans | $ | 426,820 | 47.6 | % | $ | 443,796 | 48.4 | % | ||||||
Consumer loans | 3,336,891 | 52.4 | % | 3,420,756 | 51.6 | % | ||||||||
Unallocated allowance | 47,023 | n/a | 47,023 | n/a | ||||||||||
Total ALLL | 3,810,734 | 100.0 | % | 3,911,575 | 100.0 | % | ||||||||
Reserve for unfunded lending commitments | 86,973 | 109,111 | ||||||||||||
Total ACL | $ | 3,897,707 | $ | 4,020,686 |
(in thousands) | June 30, 2018 | December 31, 2017 | ||||||
Investment securities AFS: | ||||||||
U.S. Treasury securities and government agencies | $ | 6,176,533 | $ | 7,042,828 | ||||
FNMA and FHLMC securities | 6,404,390 | 6,840,696 | ||||||
State and municipal securities | 20 | 23 | ||||||
Other securities (1) | 483,930 | 529,636 | ||||||
Total investment securities AFS | 13,064,873 | 14,413,183 | ||||||
Investment securities HTM: | ||||||||
U.S. government agencies | 2,920,087 | 1,799,808 | ||||||
Total investment securities HTM(2) | 2,920,087 | 1,799,808 | ||||||
Trading securities | — | — | ||||||
Other investments | 700,858 | 658,864 | ||||||
Total investment portfolio | $ | 16,685,818 | $ | 16,871,855 |
(1) | Other securities primarily include corporate debt securities and ABS. |
(2) | HTM securities are measured and presented at amortized cost. |
June 30, 2018 | ||||||||
(in thousands) | Amortized Cost | Fair Value | ||||||
FNMA | $ | 3,627,256 | $ | 3,498,765 | ||||
FHLMC | 3,035,095 | 2,905,625 | ||||||
GNMA (1) | 7,605,004 | 7,385,230 | ||||||
Government - Treasuries | 1,632,805 | 1,617,802 | ||||||
Total | $ | 15,900,160 | $ | 15,407,422 |
(1) | Includes U.S. government agency MBS. |
(in thousands) | Consumer and Business Banking | Commercial Banking | CIB | SC | Total | |||||||||||||||
Goodwill | $ | 1,880,304 | $ | 1,412,995 | $ | 131,130 | $ | 1,019,960 | $ | 4,444,389 |
SHUSA | |||||||||
June 30, 2018 | Well-capitalized Requirement(1) | Minimum Requirement(1) | |||||||
CET1 capital ratio | 16.28 | % | 6.50 | % | 4.50 | % | |||
Tier 1 capital ratio | 17.89 | % | 8.00 | % | 6.00 | % | |||
Total capital ratio | 19.55 | % | 10.00 | % | 8.00 | % | |||
Leverage ratio | 14.57 | % | 5.00 | % | 4.00 | % |
(1) | As defined by Federal Reserve regulations. The Company's ratios are presented under a Basel III phasing in basis. |
BANK | |||||||||
June 30, 2018 | Well-capitalized Requirement(2) | Minimum Requirement(2) | |||||||
CET1 capital ratio | 18.17 | % | 6.50 | % | 4.50 | % | |||
Tier 1 capital ratio | 18.17 | % | 8.00 | % | 6.00 | % | |||
Total capital ratio | 19.30 | % | 10.00 | % | 8.00 | % | |||
Leverage ratio | 14.43 | % | 5.00 | % | 4.00 | % |
(2) | As defined by OCC regulations. The Bank's ratios are presented under a Basel III phasing in basis. |
• | three securitization on its Santander Drive Auto Receivables Trust ("SDART") platform for approximately $3.3 billion; |
• | two securitization on its Drive Auto Receivables Trust (“DRIVE"), deeper subprime platform for approximately $2.1 billion; |
• | one private lease securitization for approximately $1.2 billion; |
• | one lease securitization on its Santander Retail Auto Lease Trust platform for approximately $1.0 billion; |
• | one private amortizing lease facility for approximately $1.0 billion; |
• | issuance of retained bonds on its SDART platform for approximately $304.0 million; and |
• | issuance of retained bonds on its DRIVE platform for $191.0 million. |
Six-Month Period Ended June 30, | ||||||||
(in thousands) | 2018 | 2017 | ||||||
Net cash flows from operating activities | $ | 3,909,460 | $ | 2,505,613 | ||||
Net cash flows from investing activities | (5,486,642 | ) | (304,670 | ) | ||||
Net cash flows from financing activities | 489,220 | (4,433,072 | ) |
• | The Bank declared and paid $100.0 million in dividends to SHUSA; |
• | The Bank has declared an ordinary dividend of $75 million and a special dividend of $250 million payable on August 15, 2018; |
• | BSI declared and paid $10.0 million in dividends to SHUSA; and |
• | SHUSA contributed $40.0 million to SSLLC. |
Payments Due by Period | ||||||||||||||||||||
(in thousands) | Total | Less than 1 year | Over 1 yr to 3 yrs | Over 3 yrs to 5 yrs | Over 5 yrs | |||||||||||||||
FHLB advances (1) | $ | 1,319,560 | $ | 1,017,339 | $ | 302,221 | $ | — | $ | — | ||||||||||
Notes payable - revolving facilities | 4,625,023 | 1,167,063 | 3,457,960 | — | — | |||||||||||||||
Notes payable - secured structured financings | 24,361,841 | 1,524,792 | 7,986,566 | 10,263,313 | 4,587,170 | |||||||||||||||
Other debt obligations (1) (2) | 13,377,474 | 2,266,784 | 3,712,148 | 3,454,952 | 3,943,590 | |||||||||||||||
Junior subordinated debentures due to capital trust entities (1) (2) | 280,125 | 6,435 | 14,277 | 14,197 | 245,216 | |||||||||||||||
CDs (1) | 6,067,615 | 3,310,846 | 2,356,778 | 392,314 | 7,677 | |||||||||||||||
Non-qualified pension and post-retirement benefits | 131,197 | 13,918 | 26,123 | 26,330 | 64,826 | |||||||||||||||
Operating leases(3) | 719,168 | 125,213 | 220,482 | 164,213 | 209,260 | |||||||||||||||
Total contractual cash obligations | $ | 50,882,003 | $ | 9,432,390 | $ | 18,076,555 | $ | 14,315,319 | $ | 9,057,739 |
(1) | Includes interest on both fixed and variable rate obligations. The interest associated with variable rate obligations is based on interest rates in effect at June 30, 2018. The contractual amounts to be paid on variable rate obligations are affected by changes in market interest rates. Future changes in market interest rates could materially affect the contractual amounts to be paid. |
(2) | Includes all carrying value adjustments, such as unamortized premiums and discounts and hedge basis adjustments. |
(3) | Does not include future expected sublease income. |
The following estimated percentage increase/(decrease) to net interest income would result | ||||||
If interest rates changed in parallel by the amounts below | June 30, 2018 | December 31, 2017 | ||||
Down 100 basis points | (3.44 | )% | (3.33 | )% | ||
Up 100 basis points | 3.20 | % | 2.88 | % | ||
Up 200 basis points | 6.22 | % | 5.48 | % |
The following estimated percentage increase/(decrease) to MVE would result | ||||||
If interest rates changed in parallel by the amounts below | June 30, 2018 | December 31, 2017 | ||||
Down 100 basis points | (1.01 | )% | (2.55 | )% | ||
Up 100 basis points | (1.39 | )% | (0.04 | )% | ||
Up 200 basis points | (3.60 | )% | (1.62 | )% |
1. | Control Environment |
2. | SC’s Control Environment, Risk Assessment, Control Activities and Monitoring |
• | Management did not effectively execute a strategy to hire and retain a sufficient complement of personnel with an appropriate level of knowledge, experience, and training in certain areas important to financial reporting. |
• | The tone at the top was insufficient to ensure there were adequate mechanisms and oversight to ensure accountability for the performance of internal control over financial reporting responsibilities and to ensure corrective actions were appropriately prioritized and implemented in a timely manner. |
• | There was not adequate management oversight of accounting and financial reporting activities in implementing certain accounting practices to conform to the Company’s policies and GAAP. |
• | There was not an adequate assessment of changes in risks by management that could significantly impact internal control over financial reporting or an adequate determination and prioritization of how those risks should be managed. |
• | There was not adequate management oversight and identification of models, spreadsheets and completeness and accuracy of data material to financial reporting. |
• | There were insufficiently documented Company accounting policies and insufficiently detailed Company procedures to put policies into effective action. |
• | There was a lack of appropriate tone at the top in establishing an effective control owner for the risk and controls self-assessment process, which contributed to a lack of clarity about ownership of risk assessments and control design and effectiveness. |
• | There was insufficient governance, oversight and monitoring of the credit loss allowance and accretion processes and a lack of defined roles and responsibilities in monitoring functions. |
• | Review controls over completeness and accuracy of data, inputs and assumptions in models and spreadsheets used for estimating credit loss allowance and related model changes were not effective and management did not adequately challenge significant assumptions. |
• | Review and approval controls over the development of new models to estimate credit loss allowance and related model changes were ineffective. |
• | Adequate and comprehensive performance monitoring over related model output results was not performed and we did not maintain adequate model documentation. |
• | Review controls over completeness and accuracy of data, inputs, calculation and assumptions in models and spreadsheets used for estimating accretion were not effective and management did not adequately challenge significant assumptions. |
• | Review and approval controls over the development of new models to estimate accretion and related model changes were ineffective. |
• | Adequate and comprehensive performance monitoring over related model output results was not performed and we did not maintain adequate model documentation. |
• | Established regular working group meetings, with appropriate oversight by management, to review and challenge complex accounting matters and strengthen accountability for performance of internal control over financial reporting responsibilities and prioritization of corrective actions. |
• | Appointed a Head of Internal Controls with significant public company financial reporting experience and the requisite skillsets in areas important to financial reporting. |
• | Developed a plan to enhance its risk assessment processes, control procedures and documentation, including the implementation of a Company-wide comprehensive risk assessment to identify the processes and financial statement areas with higher risks of misstatement. |
• | Established policies and procedures for the oversight of subsidiaries that includes accountability for each subsidiary for maintenance of accounting policies, evaluation of significant and unusual transactions, material estimates, and regular reporting and review of changes in the control environment and related accounting processes. |
• | Reallocated additional Company resources to improve the oversight of subsidiary operations and to ensure sufficient staffing to conduct enhanced financial reporting reviews. |
• | Collaborated with other departments, such as Accounting Policy and Legal, to ensure entity information/data is shared and reviewed accordingly. |
• | Appointed an additional independent director to the Audit Committee of the Board with extensive experience as a financial expert in our industry to provide further experience on the Committee. |
• | Established regular working group meetings, with appropriate oversight by management of both SC and SHUSA to strengthen accountability for performance of internal control over financial reporting responsibilities and prioritization of corrective actions. |
• | Hired a Chief Accounting Officer and other key personnel with significant public company financial reporting experience and the requisite skillsets in areas important to financial reporting. |
• | Developed and implemented a plan to enhance its risk assessment processes, control procedures and documentation. |
• | Reallocated additional Company resources to improve the oversight for certain financial models. |
• | Increased accounting resources with qualified permanent resources to ensure sufficient staffing to conduct enhanced financial reporting procedures and to continue the remediation efforts. |
• | Improved management documentation, review controls and oversight of accounting and financial reporting activities to ensure accounting practices conform to the Company’s policies and GAAP. |
• | Increased accounting participation in critical governance activities to ensure an adequate assessment of risk activities which may impact financial reporting or the related internal controls. |
• | Completed a comprehensive review and update of all accounting policies, process descriptions and control activities. |
• | Developed and implemented additional documentation, controls and governance for the credit loss allowance and accretion processes. |
• | Completed a comprehensive design effectiveness review and augmentation of the controls to ensure all critical risks are addressed. |
• | Implemented a more comprehensive monitoring plan for the credit loss allowance with a specific focus on model inputs, changes in model assumptions and model outputs to ensure an effective execution of the Company’s risk strategy. |
• | Implemented improved controls over the development of new models or changes to models used to estimate credit loss allowance. |
• | Implemented enhanced on-going performance monitoring procedures. |
• | Developed comprehensive model documentation. |
• | Enhanced the Company’s communication on related issues with its senior leadership team and the Board, including the Risk Committee and the Audit Committee. |
• | Increased resources dedicated to the analysis, review and documentation to ensure compliance with GAAP and the Company’s policies. |
• | Developed a comprehensive accretion model documentation manual and implemented on-going performance monitoring to ensure compliance with required standards. |
• | Automated the process for the application of the effective interest rate method for accreting discounts, subvention payments from manufacturers and other origination costs on individually acquired RICs. |
• | Implemented comprehensive review controls over data, inputs and assumptions used in the models. |
• | Strengthened review controls and change management procedures over the models used to estimate accretion. |
• | Increased accounting resources with qualified, permanent resources to ensure an adequate level of review and execution of control activities. |
• | Improved the review controls over financial statements and the related disclosures to include a more comprehensive disclosure checklist and improved review procedures from certain members of the management. |
• | Designed and implemented additional controls over the preparation and the review of the SCF and Notes to the Consolidated Financial Statements. |
• | Strengthening the review controls, reconciliations and supporting documentation related to the classification of cash flows between operating activities and investing activities in the SCF. |
• | Enhanced the risk assessment process to identify higher risk data provisioning processes. |
• | Implementing additional completeness and accuracy reviews at a detailed level at the statement preparation and data provider levels. |
(3.1 | ) | |
(3.2 | ) | |
(3.3 | ) | |
(3.4 | ) | |
(3.5 | ) | |
(3.6 | ) | |
(4.1 | ) | Santander Holdings USA, Inc. has certain debt obligations outstanding. None of the instruments evidencing such debt authorizes an amount of securities in excess of 10% of the total assets of Santander Holdings USA, Inc. and its subsidiaries on a consolidated basis; therefore, copies of such instruments are not included as exhibits to this Annual Report on Form 10-K. Santander Holdings USA, Inc. agrees to furnish copies to the SEC on request. |
(10.1 | ) | |
(10.2 | ) | |
(10.3 | ) | |
(31.1 | ) | |
(31.2 | ) | |
(32.1 | ) | |
(32.2 | ) | |
(101.INS) | XBRL Instance Document (Filed herewith) |
(101.SCH) | XBRL Taxonomy Extension Schema (Filed herewith) | |
(101.CAL) | XBRL Taxonomy Extension Calculation Linkbase (Filed herewith) | |
(101.DEF) | XBRL Taxonomy Extension Definition Linkbase (Filed herewith) | |
(101.LAB) | XBRL Taxonomy Extension Label Linkbase (Filed herewith) | |
(101.PRE) | XBRL Taxonomy Extension Presentation Linkbase (Filed herewith) |
SANTANDER HOLDINGS USA, INC. (Registrant) | |||
Date: | August 9, 2018 | /s/ Madhukar Dayal | |
Madhukar Dayal | |||
Chief Financial Officer and Senior Executive Vice President | |||
Date: | August 9, 2018 | /s/ David L. Cornish | |
David L. Cornish | |||
Chief Accounting Officer, Controller and Executive Vice President |
1. | I have reviewed this Quarterly Report on Form 10-Q of Santander Holdings USA, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ Scott E. Powell |
Name: Scott E. Powell |
Title: President and Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Santander Holdings USA, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ Madhukar Dayal |
Name: Madhukar Dayal |
Title: Chief Financial Officer and Senior Executive Vice President |
(1) | the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | the information contained in the Report fairly presents, in all in material respects, the financial condition and results of operations of the Company. |
/s/ Scott E. Powell |
Name: Scott E. Powell |
Title: President and Chief Executive Officer |
(1) | the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Madhukar Dayal |
Name: Madhukar Dayal |
Title: Chief Financial Officer and Senior Executive Vice President |
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Jul. 31, 2018 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Santander Holdings USA, Inc. | |
Entity Central Index Key | 0000811830 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 530,391,043 |
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
ASSETS | |||||||||||||||
Cash and cash equivalents | $ 6,127,604 | $ 6,519,967 | |||||||||||||
Investment securities: | |||||||||||||||
Available-for-sale (AFS) at fair value | 13,064,873 | 14,413,183 | |||||||||||||
Held-to-maturity (HTM) (fair value of $2,826,499 and $1,773,938 as of June 30, 2018 and December 31, 2017, respectively) | 2,920,087 | 1,799,808 | |||||||||||||
Other investments (includes Trading securities of $1,874 and $1 as of June 30, 2018 and December 31, 2017, respectively) | 700,858 | 658,864 | |||||||||||||
Loans held-for-investment (LHFI) | [1],[2] | 83,136,904 | 80,740,852 | ||||||||||||
Allowance for loan and lease losses (ALLL) | [2] | (3,810,734) | (3,911,575) | ||||||||||||
Net LHFI | 79,326,170 | 76,829,277 | |||||||||||||
Loans held-for-sale (LHFS) | [3] | 1,559,799 | 2,522,486 | ||||||||||||
Premises and equipment, net | [4] | 788,062 | 849,061 | ||||||||||||
Operating lease assets, net | [2],[5] | 11,834,222 | 10,474,308 | ||||||||||||
Goodwill | 4,444,389 | 4,444,389 | |||||||||||||
Intangible assets, net | 505,194 | 535,753 | |||||||||||||
Bank-owned life insurance (BOLI) | 1,813,977 | 1,795,700 | |||||||||||||
Restricted cash | [2] | 3,123,208 | 3,818,807 | ||||||||||||
Other assets | [2],[6] | 3,930,251 | 3,632,427 | ||||||||||||
TOTAL ASSETS | 130,138,694 | 128,294,030 | |||||||||||||
LIABILITIES | |||||||||||||||
Accrued expenses and payables | 3,238,550 | 2,825,263 | |||||||||||||
Deposits and other customer accounts | 61,556,548 | 60,831,103 | |||||||||||||
Borrowings and other debt obligations | [2] | 38,771,378 | 39,003,313 | ||||||||||||
Advance payments by borrowers for taxes and insurance | 190,604 | 159,321 | |||||||||||||
Deferred tax liabilities, net | 1,144,002 | 969,996 | |||||||||||||
Other liabilities | [2] | 1,085,133 | 799,403 | ||||||||||||
TOTAL LIABILITIES | 105,986,215 | 104,588,399 | |||||||||||||
Commitments and Contingencies (Note 16) | |||||||||||||||
STOCKHOLDER'S EQUITY | |||||||||||||||
Preferred stock (no par value; $25,000 liquidation preference; 7,500,000 shares authorized; 8,000 shares outstanding at both June 30, 2018 and December 31, 2017) | 195,445 | 195,445 | |||||||||||||
Common stock and paid-in capital (no par value; 800,000,000 shares authorized; 530,391,043 shares outstanding at both June 30, 2018 and December 31, 2017) | 17,732,184 | 17,723,010 | |||||||||||||
Accumulated other comprehensive loss | (409,449) | (198,431) | |||||||||||||
Retained earnings | 3,931,614 | 3,462,674 | |||||||||||||
TOTAL SHUSA STOCKHOLDER'S EQUITY | 21,449,794 | 21,182,698 | |||||||||||||
Noncontrolling interest (NCI) | 2,702,685 | 2,522,933 | |||||||||||||
TOTAL STOCKHOLDER'S EQUITY | 24,152,479 | 23,705,631 | |||||||||||||
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY | $ 130,138,694 | $ 128,294,030 | |||||||||||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - USD ($) |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
ASSETS | |||||||||||
Held-to-maturity securities, fair value | $ 2,826,499,000 | $ 1,773,938,000 | |||||||||
Trading securities | 1,874,000 | 1,000 | |||||||||
Loans held for investment, fair value | 152,100,000 | 186,500,000 | |||||||||
Accumulated depreciation | 1,500,000,000 | 1,400,000,000 | |||||||||
LHFI | [1] | 1,559,799,000 | 2,522,486,000 | ||||||||
Operating lease assets, net | [2],[3] | 11,834,222,000 | 10,474,308,000 | ||||||||
Restricted cash | [3] | 3,123,208,000 | 3,818,807,000 | ||||||||
Other assets | [3],[4] | 3,930,251,000 | 3,632,427,000 | ||||||||
Other liabilities | [3] | 1,085,133,000 | 799,403,000 | ||||||||
Operating leases, accumulated depreciation | $ (3,100,000,000) | $ (3,400,000,000) | |||||||||
STOCKHOLDER'S EQUITY | |||||||||||
Preferred stock, no par value (in usd per share) | |||||||||||
Preferred stock, liquidation preference | $ 25,000 | $ 25,000 | |||||||||
Preferred stock, shares authorized (in shares) | 7,500,000 | 7,500,000 | |||||||||
Preferred stock, shares outstanding (in shares) | 8,000 | 8,000 | |||||||||
Common stock, no par value (in usd per share) | |||||||||||
Common stock, shares authorized (in shares) | 800,000,000 | 800,000,000 | |||||||||
Common stock, shares outstanding (in shares) | 530,391,043 | 530,391,043 | |||||||||
VIE, Primary Beneficiary | |||||||||||
ASSETS | |||||||||||
LHFI | $ 23,095,829,000 | $ 22,712,864,000 | |||||||||
Operating lease assets, net | 11,729,482,000 | 10,160,327,000 | |||||||||
Restricted cash | 1,657,399,000 | 1,995,557,000 | |||||||||
Other assets | 701,267,000 | 733,123,000 | |||||||||
Borrowings and other debt obligations | 29,515,015,000 | 28,469,999,000 | |||||||||
Other liabilities | 221,065,000 | 197,969,000 | |||||||||
Residential mortgages | |||||||||||
ASSETS | |||||||||||
Mortgage servicing rights | 158,470,000 | 145,993,000 | |||||||||
Recurring | |||||||||||
ASSETS | |||||||||||
Trading securities | 1,874,000 | 1,000 | |||||||||
Loans held for investment, fair value | 152,082,000 | 186,471,000 | |||||||||
Loans held for sale | 238,864,000 | 197,691,000 | |||||||||
Mortgage servicing rights | $ 158,470,000 | $ 145,993,000 | |||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|||||
INTEREST INCOME: | ||||||||
Loans | $ 1,813,853 | $ 1,868,918 | $ 3,561,579 | $ 3,707,856 | ||||
Interest-earning deposits | 33,939 | 20,476 | 66,452 | 38,910 | ||||
Investment securities: | ||||||||
AFS | 77,031 | 95,015 | 150,536 | 176,441 | ||||
HTM | 17,181 | 10,011 | 34,245 | 20,643 | ||||
Other investments | 4,599 | 5,025 | 9,848 | 11,188 | ||||
TOTAL INTEREST INCOME | 1,946,603 | 1,999,445 | 3,822,660 | 3,955,038 | ||||
INTEREST EXPENSE: | ||||||||
Deposits and other customer accounts | 92,333 | 58,824 | 167,758 | 120,818 | ||||
Borrowings and other debt obligations | 316,654 | 298,872 | 621,344 | 589,907 | ||||
TOTAL INTEREST EXPENSE | 408,987 | 357,696 | 789,102 | 710,725 | ||||
NET INTEREST INCOME | 1,537,616 | 1,641,749 | 3,033,558 | 3,244,313 | ||||
Provision for credit losses | 379,834 | 604,768 | 882,368 | 1,340,214 | ||||
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES | 1,157,782 | 1,036,981 | 2,151,190 | 1,904,099 | ||||
NON-INTEREST INCOME: | ||||||||
Consumer and commercial fees | 136,165 | 162,334 | 276,337 | 316,702 | ||||
Lease income | 569,306 | 489,043 | 1,110,202 | 985,087 | ||||
Miscellaneous income, net | [1],[2] | 113,283 | 69,383 | 234,085 | 144,526 | |||
TOTAL FEES AND OTHER INCOME | 818,754 | 720,760 | 1,620,624 | 1,446,315 | ||||
Net gains/(losses) on sale of investment securities | 419 | 9,049 | (244) | 9,569 | ||||
TOTAL NON-INTEREST INCOME | 819,173 | 729,809 | 1,620,380 | 1,455,884 | ||||
GENERAL AND ADMINISTRATIVE EXPENSES: | ||||||||
Compensation and benefits | 427,728 | 455,616 | 896,505 | 907,857 | ||||
Occupancy and equipment expenses | 163,171 | 163,553 | 322,511 | 326,264 | ||||
Technology, outside service, and marketing expense | 156,010 | 162,259 | 308,292 | 297,771 | ||||
Loan expense | 97,679 | 95,872 | 194,493 | 194,217 | ||||
Lease expense | 436,795 | 369,240 | 861,061 | 728,032 | ||||
Other administrative expenses | 135,565 | 95,096 | 239,746 | 197,334 | ||||
TOTAL GENERAL AND ADMINISTRATIVE EXPENSES | 1,416,948 | 1,341,636 | 2,822,608 | 2,651,475 | ||||
OTHER EXPENSES: | ||||||||
Amortization of intangibles | 15,288 | 15,424 | 30,576 | 30,915 | ||||
Deposit insurance premiums and other expenses | 14,804 | 17,596 | 31,564 | 35,426 | ||||
Loss on debt extinguishment | 1,201 | 3,991 | 3,413 | 10,740 | ||||
Other miscellaneous expenses | 1,508 | 8,397 | 2,946 | 9,035 | ||||
TOTAL OTHER EXPENSES | 32,801 | 45,408 | 68,499 | 86,116 | ||||
INCOME BEFORE INCOME TAX PROVISION | 527,206 | 379,746 | 880,463 | 622,392 | ||||
Income tax provision | 168,035 | 91,983 | 263,356 | 170,920 | ||||
NET INCOME INCLUDING NCI | 359,171 | 287,763 | 617,107 | 451,472 | ||||
LESS: NET INCOME ATTRIBUTABLE TO NCI | 104,018 | 104,724 | 178,416 | 155,352 | ||||
NET INCOME ATTRIBUTABLE TO SANTANDER HOLDINGS USA, INC. | $ 255,153 | $ 183,039 | $ 438,691 | $ 296,120 | ||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Income Statement [Abstract] | ||||
Lower of cost or market adjustment on a portion of unsecured loan portfolio held for sale | $ 79.2 | $ 95.9 | $ 149.7 | $ 162.0 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) (unaudited) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||||
Statement of Comprehensive Income [Abstract] | |||||||||
NET INCOME INCLUDING NCI | $ 359,171 | $ 287,763 | $ 617,107 | $ 451,472 | |||||
OTHER COMPREHENSIVE INCOME, NET OF TAX | |||||||||
Net unrealized (losses) / gains on cash flow hedge derivative financial instruments, net of tax | [1] | (4,739) | 6,523 | (22,103) | 4,036 | ||||
Net unrealized (losses) / gains on AFS investment securities, net of tax | [2] | (35,054) | 15,349 | (145,984) | 36,318 | ||||
Pension and post-retirement actuarial gains / (losses), net of tax | 625 | 556 | (3,837) | 1,041 | |||||
TOTAL OTHER COMPREHENSIVE (LOSS) / GAIN, NET OF TAX | (39,168) | 22,428 | (171,924) | 41,395 | |||||
COMPREHENSIVE INCOME | 320,003 | 310,191 | 445,183 | 492,867 | |||||
NET INCOME ATTRIBUTABLE TO NCI | 104,018 | 104,724 | 178,416 | 155,352 | |||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO SHUSA | $ 215,985 | $ 205,467 | $ 266,767 | $ 337,515 | |||||
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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) (unaudited) (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Statement of Comprehensive Income [Abstract] | ||||
Other comprehensive income attributable to noncontrolling interest | $ (0.2) | $ 3.2 | $ 5.8 | $ 0.2 |
ASU 2018-02 | ||||
Reclassification of AOCI to retained earnings | $ 39.1 |
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDER’S EQUITY (Parenthetical) $ in Thousands |
6 Months Ended |
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Jun. 30, 2017
USD ($)
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Statement of Stockholders' Equity [Abstract] | |
Dividends paid on preferred stock | $ 7,300 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (Parenthetical) - USD ($) $ in Thousands |
6 Months Ended | ||||
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Jun. 30, 2017 |
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Statement of Cash Flows [Abstract] | |||||
Beginning restricted cash | $ 3,818,807 | [1] | $ 3,000,000 | ||
Net change in restricted cash | (695,600) | 264,100 | |||
Ending restricted cash | $ 3,123,208 | [1] | $ 3,300,000 | ||
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BASIS OF PRESENTATION AND ACCOUNTING POLICIES |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BASIS OF PRESENTATION AND ACCOUNTING POLICIES | BASIS OF PRESENTATION AND ACCOUNTING POLICIES Introduction Santander Holdings USA, Inc. ("SHUSA" or "the Company") is the parent company (the "Parent Company") of Santander Bank, National Association, (the "Bank" or "SBNA"), a national banking association; Santander Consumer USA Holdings Inc. (together with its subsidiaries, "SC"), a consumer finance company focused on vehicle finance; Santander BanCorp (together with its subsidiaries, "Santander BanCorp"), a financial holding company headquartered in Puerto Rico that offers a full range of financial services through its wholly-owned banking subsidiary, Banco Santander Puerto Rico ("BSPR"); Santander Securities LLC ("SSLLC"), a broker-dealer headquartered in Boston, Massachusetts; Banco Santander International ("BSI"), an Edge corporation located in Miami, Florida, that offers a full range of banking services to foreign individuals and corporations based primarily in Latin America; and Santander Investment Securities Inc. ("SIS"), a registered broker-dealer located in New York providing services in investment banking, institutional sales, and trading and offering research reports of Latin American and European equity and fixed income securities; as well as several other subsidiaries. SHUSA is headquartered in Boston and the Bank's home office is in Wilmington, Delaware. SHUSA is a wholly-owned subsidiary of Banco Santander, S.A. ("Santander"). The Parent Company's two largest subsidiaries by asset size and revenue are the Bank and SC. The Bank’s primary business consists of attracting deposits and providing other retail banking services through its network of retail branches, and originating small business loans, middle market, large and global commercial loans, multifamily loans, residential mortgage loans, home equity lines of credit, and auto and other consumer loans throughout the Mid-Atlantic and Northeastern areas of the United States, focused throughout Pennsylvania, New Jersey, New York, New Hampshire, Massachusetts, Connecticut, Rhode Island, and Delaware. The Bank uses its deposits, as well as other financing sources, to fund its loan and investment portfolios. SC is a specialized consumer finance company focused on vehicle finance and third-party servicing. SC's primary business is the indirect origination and securitization of retail installment contracts ("RICs") principally through manufacturer-franchised dealers in connection with their sale of new and used vehicles to subprime retail consumers. In conjunction with a ten-year private label financing agreement with Fiat Chrysler Automobiles US LLC ("FCA") that became effective May 1, 2013 (the "Chrysler Agreement"), SC offers a full spectrum of auto financing products and services to FCA customers and dealers under the Chrysler Capital brand. These products and services include consumer RICs and leases, as well as dealer loans for inventory, construction, real estate, working capital and revolving lines of credit. Refer to Note 16 for additional details. On June 1, 2018, SC announced that it is in exploratory discussions with FCA regarding the future of FCA's U.S. finance operations. FCA has announced its intention to establish a captive U.S. auto finance unit and indicated that acquiring Chrysler Capital is one option it will consider. Under the Chrysler Agreement, FCA has the option to acquire, for fair market value, an equity participation in the business offering and providing financial services contemplated by the Chrysler Agreement. The likelihood, timing and structure of any such transaction, and the likelihood that the Chrysler Agreement will terminate, cannot be reasonably determined. On July 11, 2018, in order to facilitate discussions regarding the Chrysler Agreement, FCA and the Company entered into a tolling agreement pursuant to which the parties agreed to preserve their respective rights, claims and defenses under the Chrysler Agreement as they existed on April 30, 2018. As of June 30, 2018, SC was owned approximately 68.0% by SHUSA and 32.0% by other shareholders. During 2017, SHUSA increased its ownership in SC; refer to additional details in Note 21 of the Company's Annual Report on Form 10-K as of December 31, 2017. Common shares of SC ("SC Common Stock") are listed on the New York Stock Exchange (the "NYSE") under the trading symbol "SC." Intermediate Holding Company ("IHC") The enhanced prudential standards mandated by Section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "DFA")(the “Final Rule") were enacted by the Federal Reserve System (the "Federal Reserve") to strengthen regulatory oversight of foreign banking organizations ("FBOs"). Under the Final Rule, FBOs with over $50 billion of U.S. non-branch assets, including Santander, were required to consolidate U.S. subsidiary activities under an IHC. Due to its U.S. non-branch total consolidated asset size, Santander is subject to the Final Rule. As a result of this rule, Santander transferred substantially all of its equity interests in U.S. bank and non-bank subsidiaries previously outside the Company to the Company, which became an IHC effective July 1, 2016. These subsidiaries included Santander BanCorp, BSI, SIS and SSLLC, as well as several other subsidiaries. On July 1, 2017, an additional Santander subsidiary, SFS, a finance company located in Puerto Rico, was transferred to the Company. Additionally, NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) effective July 2, 2018, Santander transferred Santander Asset Management, LLC ("SAM") to the IHC. The contribution of SAM to the Company transferred approximately $5.4 million of assets, $1.0 million of liabilities, and $4.4 million of equity to the Company. Although SAM is an entity under common control, its results of operations, financial condition, and cash flows are immaterial to the historical financial results of the Company. As a result, the Company will report the results of SAM on a prospective basis beginning July 2, 2018. Basis of Presentation These Condensed Consolidated Financial Statements include the assets, liabilities, revenues and expense accounts of the Company and its consolidated subsidiaries, including the Bank, SC, and certain special purpose financing trusts utilized in financing transactions that are considered VIEs. The Company generally consolidates VIEs for which it is deemed to be the primary beneficiary and voting interest entities ("VOEs") in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. These Consolidated Financial Statements have been prepared by the Company pursuant to Securities and Exchange Commission ("SEC") regulations. Additionally, where applicable, the Company's accounting policies conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. In the opinion of management, the accompanying Condensed Consolidated Financial Statements reflect all adjustments of a normal and recurring nature necessary for a fair statement of the Consolidated Balance Sheets, Statements of Operations, Statements of Comprehensive Income, Statements of Stockholder's Equity and Statements of Cash Flows ("SCF") for the periods indicated, and contain adequate disclosure for the fair statement of this interim financial information. Corrections to Previously Reported Amounts We have made certain corrections to previously disclosed amounts to correct for errors related to the classification of cash flows from the sale of automobiles returned to the Company at the end of a lease term. Operating Lease Cash Flow Classification Beginning June 30, 2014 through September 30, 2017, cash flows from the sale of automobiles returned to the Company at the end of a lease term were incorrectly recorded in the Consolidated SCF, resulting in an overstatement of cash flows from investing activities (Proceeds from the sale and termination of operating leases) and an understatement of cash flows from operating activities (Depreciation, amortization and accretion) in the amount of $288.0 million for the six-month period ended June 30, 2017. There was no net impact to cash provided by financing activities. The misclassification errors did not impact the net change in cash and cash equivalents, total cash and cash equivalents, net income, or any other operating measure. There was no impact to the Company's Consolidated Balance Sheets, Consolidated Statements of Operations, Consolidated Statements of Other Comprehensive Income, or Consolidated Statements of Equity for any period as a result of the Consolidated SCF error. Management has evaluated the errors and determined they are immaterial to previously issued financial statements. The Company has corrected the balance described above for the six months ended June 30, 2017 in its Consolidated SCF included herein. In future filings, the Company will correct the Consolidated SCF disclosures for the comparative periods when presented. Significant Accounting Policies Management has identified (i) the allowance for loan losses for originated and purchased loans and the reserve for unfunded lending commitments, (ii) valuation of automotive leases and residuals, (iii) accretion of discounts and subvention on RICs, (iv) goodwill, (vi) fair value of financial instruments, and (v) income taxes as the Company's significant accounting policies and estimates, in that they are important to the portrayal of the Company's financial condition, results of operations and cash flows and the accounting estimates related thereto require management's most difficult, subjective and complex judgments as a result of the need to make estimates about the effect of matters that are inherently uncertain. These Condensed Consolidated Financial Statements should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2017. As of June 30, 2018, with the exception of the items noted in the section captioned "Recently Adopted Accounting Standards" below, there have been no significant changes to the Company's accounting policies as disclosed in the Annual Report on Form 10-K for the year ended December 31, 2017. NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) Recently Adopted Accounting Standards Since January 1, 2018, the Company adopted the following Financial Accounting Standards Board ("FASB") Accounting Standards Updates (“ASUs"):
The Company adopted this ASU as of January 1, 2018 using the modified retrospective method of transition, resulting in an immaterial cumulative-effect adjustment recorded to opening retained earnings for the current period. The adoption of this ASU did not result in material changes in the timing of the Company's revenue recognition, but requires gross presentation of certain costs previously offset against revenue. This change in presentation is reflected in the current period and will increase both noninterest revenue and noninterest expense for the Company. The increase is predominantly associated with certain distribution costs on wealth management products (historically offset against Miscellaneous income), with the remainder of the increase associated with certain underwriting service costs (historically offset against Miscellaneous income). Refer to Note 15 for additional details. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue recognition standard, while prior period amounts have not been adjusted and continue to be reported in accordance with our historic accounting. The cumulative-effect of the changes made to our January 1, 2018 Condensed Consolidated Balance Sheet for the adoption of the new revenue recognition standard were as follows:
NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) The following discloses the impact on the Company's Condensed Balance Sheet at June 30, 2018 and the Condensed Statement of Operations for the three-month and six-month periods ended June 30, 2018 for the adoption of this new accounting standard:
NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) on the opening balance of retained earnings for the cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness. Refer to Note 12 for further discussion of the Company's derivatives.
Cumulative net impact to opening Retained earnings As a result of the adoption of the new accounting standards outlined above, the Company recorded a cumulative net increase to opening Retained earnings of $42.0 million. Those impacts were attributed to the following ASUs adopted during the period:
The adoption of the following ASUs did not have an impact on the Company's financial position or results of operations:
As required by the adoption of ASU 2016-18 and ASU 2014-09, the following additional accounting policy disclosures are required for the nature of cash restrictions and revenue recognized from contracts with customers from disclosures included in our Annual Report on Form 10-K for the year ended December 31, 2017: Cash, Cash Equivalents, and Restricted Cash Cash deposited to support securitization transactions, lockbox collections, and related required reserve accounts are recorded in the Company's Consolidated Balance Sheets as Restricted cash. Excess cash flows generated by Trusts are added to the restricted cash reserve account, creating additional over-collateralization until the contractual securitization requirement has been reached. Once the targeted reserve requirement is satisfied, additional excess cash flows generated by the Trusts are released to the Company as distributions from the Trusts. Lockbox collections are added to restricted cash and released when transferred to the appropriate warehouse line of credit or trust. The Company also maintains restricted cash primarily related to cash posted as collateral related to derivative agreements, cash restricted for investment purposes and cash advanced for loan purchases. NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) Revenue Recognized from Contracts with Customers Depository services Depository services are performed under an agreement with a customer, and those services include personal deposit account opening and maintaining, checking service, online banking service, debit card services, etc. Depository service fees related to customer deposits can generally be distinguished between monthly service fees and transactional fees within the single performance obligation of providing depository account services. Monthly account service and maintenance fees are provided over a period of time (usually a month), and revenue is recognized as the Company performs the service (usually at the end of the month). The services for transactional fees are performed at a point in time and revenue is recognized when the transaction occurs. Commissions and trailer fees Commission fees are earned from the selling of annuity contracts to customers on behalf of insurance companies, acting as the broker for certain equity trading, and sales of interests in mutual funds. The Company elected the expected value method for estimating commission fees due to the large number of customer contracts with similar characteristics. However, commissions and trailer fees are fully constrained as the Company cannot sufficiently estimate the consideration to which it could be entitled to earn. Commissions are generally associated with point-in-time transactions or agreements that are one year or less. The performance obligation is satisfied immediately and revenue is recognized as the Company performs the service. Interchange income, net The Company has entered into agreements with payment networks in which the Company will issue the payment network's credit card as part of the Company's credit card portfolio. Each time a cardholder makes a purchase at a merchant and the transaction is processed, the Company receives an interchange fee in exchange for the authorization and settlement services provided to the payment networks. The performance obligation for the Company is to provide authorization and settlement services to the payment network when the payment network submits a transaction for authorization. The Company considers the payment network to be the customer, and the Company is acting as a principal when performing the transaction authorization and settlement services. The performance obligation for authorization and settlement services is satisfied at a point in time, and revenue is recognized on the date when the Company authorizes and routes the payment to the merchant. The expenses paid to payment networks are accounted for as considerations payable to the customer and therefore reduce the transaction price. Therefore, interchange income is recorded net against the expenses paid to the payment network and the cost of rewards programs. The agreements also contain immaterial fixed consideration related to upfront sign-on bonuses and program development bonuses, which are amortized over the remainder of the agreement's life on a straight-line basis. Underwriting service fees SIS, as a registered broker-dealer, performs underwriting services by raising investment capital from investors on behalf of corporations that are issuing securities. Underwriting services have one performance obligation, which is satisfied on the day SIS purchases the securities. Underwriting services include multiple parties in delivering the performance obligation. The Company has evaluated whether it is the principal or agent when we provide underwriting services. The Company acts as the principal when performing underwriting services, and recognizes fees on a gross basis. Revenue is recorded as the difference between the price the Company pays the issuer of the securities and the public offering price, and expenses are recorded as the proportionate share of the underwriting costs incurred by SIS. The Company is the principal because we obtain control of the services provided by third-party vendors and combine them with other services as part of delivering on the underwriting service. Asset and wealth management fees Asset and wealth management fees includes fee income generated from discretionary investment management and non-discretionary investment advisory contracts with customers. Discretionary investment management fees are earned for the management of the assets in the customer's account and are are recognized as earned and charged to the customer on a quarterly basis. Non-discretionary NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) investment advisory fees are earned for providing investment advisory services to customers, such as recommending the re-balancing or restructuring of the assets in the customer’s account. The investment advisory fee is recognized as earned and charged to the customer on a quarterly basis. The fee for the discretionary and nondiscretionary contracts is based on a percentage of the average assets included in the customer’s account. |
RECENT ACCOUNTING DEVELOPMENTS |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||
RECENT ACCOUNTING DEVELOPMENTS | RECENT ACCOUNTING DEVELOPMENTS In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and ASU 2018-11 Targeted Improvements in August 2018. The guidance, as amended, in this update supersedes the current lease accounting guidance for both lessees and lessors under ASC 840, Leases. The new guidance requires lessees to evaluate whether a lease is a finance lease using criteria similar to what lessees use today to determine whether they have a capital lease. Leases not classified as finance leases are classified as operating leases. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. The lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similarly to today’s guidance for operating leases. The new guidance will require lessors to account for leases using an approach that is substantially similar to existing guidance. This new guidance will be effective for the Company for the first reporting period beginning after December 15, 2018, with earlier adoption permitted. The Company does not intend to early adopt this ASU. Entities may adopt the amendment retrospectively to each prior reporting period presented in the financial statements with the cumulative effect of initial application recognized at the beginning of the earliest comparative period presented. Alternatively, an entity may adopt the amendment using an optional method with initial application at the adoption date and recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption (comparative period financial statements and disclosures are presented in accordance with current GAAP). The Company is in the process of reviewing our existing property and equipment lease contracts, as well as service contracts that may include embedded leases. Upon adoption, the Company expects to report higher assets and liabilities from recording the present value of the future minimum lease payments of the leases. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This new guidance significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace today’s “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For AFS debt securities, entities will be required to record allowances rather than reduce the carrying amount, as they do today under the other-than-temporary impairment (“OTTI') model. The standard also simplifies the accounting model for purchased credit-impaired debt securities and loans. The new guidance will be effective for the Company for the first reporting period beginning after December 15, 2019, with earlier adoption permitted. Adoption of this new guidance can be applied only on a prospective basis as a cumulative-effect adjustment to retained earnings. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. It is expected that the new model will include different assumptions used in calculating credit losses, such as estimating losses over the estimated life of a financial asset, and will consider expected future changes in macroeconomic conditions. The adoption of this ASU may result in an increase to the Company’s allowance for credit losses ("ACL"), which will depend upon the nature and characteristics of the Company's portfolio at the adoption date, as well as the macroeconomic conditions and forecasts at that date. The Company currently does not intend to early adopt this new guidance. NOTE 2. RECENT ACCOUNTING DEVELOPMENTS (continued) In addition to those described in detail above, the Company is in the process of evaluating the following ASUs, and does not expect them to have a material impact on the Company's financial position, results of operations, or disclosures:
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INVESTMENT SECURITIES |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | INVESTMENT SECURITIES Summary of Investment in Debt Securities - AFS and HTM The following tables present the amortized cost, gross unrealized gains and losses and approximate fair values of debt securities AFS at the dates indicated:
(1) Reflects the reclassification of the Company's investments in equity securities to Other investments as a result of the adoption of ASU 2016-01 as of January 1, 2018. The following tables present the amortized cost, gross unrealized gains and losses and approximate fair values of debt securities HTM at the dates indicated:
NOTE 3. INVESTMENT SECURITIES (continued) The Company continuously evaluates its investment strategies in light of changes in the regulatory and market environments that could have an impact on capital and liquidity. Based on this evaluation, it is reasonably possible that the Company may elect to pursue other strategies relative to its investment securities portfolio. During the six-month period ended June 30, 2018, the Company transferred approximately $1.2 billion of MBS from AFS to HTM in conjunction with Santander's capital management strategy. As of June 30, 2018 and December 31, 2017, the Company had investments in debt securities AFS with an estimated fair value of $6.2 billion and $5.9 billion, respectively, pledged as collateral, which was comprised of the following: $3.1 billion and $3.0 billion, respectively, were pledged as collateral for the Company's borrowing capacity with the Federal Reserve Bank (the "FRB"); $2.3 billion and $2.3 billion, respectively, were pledged to secure public fund deposits; $82.2 million and $243.8 million, respectively, were pledged to various independent parties to secure repurchase agreements, support hedging relationships, and for recourse on loan sales; $423.9 million and $0.0 million, respectively, were pledged to deposits with clearing organizations; and $312.8 million and $387.9 million, respectively, were pledged to secure the Company's customer overnight sweep product. At June 30, 2018 and December 31, 2017, the Company had $47.0 million of accrued interest related to investment securities which is included in the Other assets line of the Company's Condensed Consolidated Balance Sheets. Contractual Maturity of Debt Securities Contractual maturities of the Company’s AFS debt securities at June 30, 2018 were as follows:
Contractual maturities of the Company’s HTM debt securities at June 30, 2018 were as follows:
Actual maturities may differ from contractual maturities when there is a right to call or prepay obligations with or without call or prepayment penalties. Gross Unrealized Loss and Fair Value of Debt Securities AFS and HTM The following tables present the aggregate amount of unrealized losses as of June 30, 2018 and December 31, 2017 on securities in the Company’s AFS investment portfolios classified according to the amount of time those securities have been in a continuous loss position:
(1) Reflects the reclassification of the Company's investments in equity securities to Other investments as a result of the adoption of ASU 2016-01 as of January 1, 2018. NOTE 3. INVESTMENT SECURITIES (continued) The following tables present the aggregate amount of unrealized losses as of June 30, 2018 and December 31, 2017 on debt securities in the Company’s HTM investment portfolios classified according to the amount of time those securities have been in a continuous loss position:
OTTI Management evaluates all investment securities in an unrealized loss position for OTTI on a quarterly basis. An unrealized loss exists when the current fair value of an individual security is less than its amortized cost basis. The OTTI assessment is a subjective process requiring the use of judgments and assumptions. During the securities-level assessments, consideration is given to (1) the intent not to sell and probability that the Company will not be required to sell the security before recovery of its cost basis to allow for any anticipated recovery in fair value, (2) the financial condition and near-term prospects of the issuer, as well as company news and current events, and (3) the ability to collect the future expected cash flows. Key assumptions utilized to forecast expected cash flows may include loss severity, expected cumulative loss percentage, cumulative loss percentage to date, weighted average Fair Isaac Corporation ("FICO") scores and weighted average loan-to-value ("LTV") ratio, rating or scoring, credit ratings and market spreads, as applicable. The Company assesses and recognizes OTTI in accordance with applicable accounting standards. Under these standards, if the Company determines that impairment on its debt securities exists and it has made the decision to sell the security or it is more likely than not that the Company will be required to sell the security prior to recovery of its amortized cost basis, it recognizes the entire portion of the unrealized loss in earnings. If the Company has not made a decision to sell the security and it does not expect that it will be required to sell the security prior to the recovery of the amortized cost basis but the Company has determined that OTTI exists, it recognizes the credit-related portion of the decline in value of the security in earnings. The Company recorded no OTTI related to its investment securities for the three-month and six-month periods ended June 30, 2018 and 2017. Management has concluded that the unrealized losses on its debt securities for which it has not recognized OTTI (which were comprised of 503 individual securities at June 30, 2018) are temporary in nature since (1) they reflect the increase in interest rates, which lowers the current fair value of the securities, (2) they are not related to the underlying credit quality of the issuers, (3) the entire contractual principal and interest due on these securities is currently expected to be recoverable, (4) the Company does not intend to sell these investments at a loss and (5) it is more likely than not that the Company will not be required to sell the investments before recovery of the amortized cost basis, which for the Company's debt securities may be at maturity. Accordingly, the Company has concluded that the impairment on these securities is not other than temporary. Gains (Losses) and Proceeds on Sales of Debt Securities Proceeds from sales of investments in debt securities and the realized gross gains and losses from those sales are as follows:
NOTE 3. INVESTMENT SECURITIES (continued) The Company uses the specific identification method to determine the cost of the securities sold and the gain or loss recognized. The Company recognized $18 thousand for the six-month period ended June 30, 2018 in net losses on the sale of AFS investment securities as a result of overall balance sheet and interest rate risk management. The net loss realized for the six-month period ended June 30, 2018 was primarily comprised of the sale of MBS, including FHLMC residential debt securities and collateralized mortgage obligations ("CMOs") with a fair value of $0.3 million for a loss of $18 thousand. The Company recognized $11.1 million for the three-month and six-month periods ended June 30, 2017 in net gains on the sale of AFS investment securities as a result of overall balance sheet and interest rate risk management. The net gain realized for the three-month and six-month periods ended June 30, 2017 was primarily comprised of the sale of U.S. Treasury securities with a book value of $739.4 million for a gain of $1.8 million, and the sale of MBS's, including FHLMC residential debt securities and CMOs with a book value of $555.6 million for a gain of $9.3 million. Other Investments Other Investments consisted of the following as of:
Other investments primarily include the Company's investment in the stock of the FHLB of Pittsburgh and the FRB. These stocks do not have readily determinable fair values because their ownership is restricted and they lack a market. The stocks can be sold back only at their par value of $100 per share, and FHLB stock can be sold back only to the FHLB or to another member institution. Accordingly, these stocks are carried at cost. During the three-month and six-month periods ended June 30, 2018, the Company purchased $23.9 million and $34.1 million of FHLB stock at par, respectively, and redeemed $37.1 million and $63.0 million of FHLB stock at par, respectively. There was no gain or loss associated with these redemptions. During the three-month and six-month periods ended June 30, 2018, the Company did not purchase any FRB stock. Other investments also includes LIHTC investments, time deposits with a maturity of greater than 90 days held at non-affiliated financial institutions, trading securities, and $10.9 million of equity securities measured at fair value as of June 30, 2018, with changes in fair value recognized in net income. These consist primarily of Community Reinvestment Act (“CRA") mutual fund investments reclassified as a result of the first quarter 2018 adoption of ASU 2016-01, discussed further in Note 1. These investments were included in Investments AFS at December 31, 2017. With the exception of equity and trading securities which are measured at fair value, the Company evaluates these other investments for impairment based on the ultimate recoverability of the carrying value, rather than by recognizing temporary declines in value. The Company held an immaterial amount of equity securities without readily determinable fair values at the reporting date. Realized and Unrealized Gains (Losses) on Equity Securities
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LOANS AND ALLOWANCE FOR CREDIT LOSSES |
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Loans and Leases Receivable Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS AND ALLOWANCE FOR CREDIT LOSSES | LOANS AND ALLOWANCE FOR CREDIT LOSSES Overall The Company's loans are reported at their outstanding principal balances net of any cumulative charge-offs, unamortized deferred fees and costs and unamortized premiums or discounts. The Company maintains an ACL to provide for losses inherent in its portfolios. Certain loans are pledged as collateral for borrowings, securitizations, or special purpose entities (“SPEs"). These loans totaled $48.3 billion at June 30, 2018 and $50.8 billion at December 31, 2017. Loans that the Company intends to sell are classified as LHFS. The LHFS portfolio balance at June 30, 2018 was $1.6 billion, compared to $2.5 billion at December 31, 2017. LHFS in the residential mortgage portfolio are reported at either estimated fair value (if the FVO is elected) or the lower of cost or fair value. For a discussion on the valuation of LHFS at fair value, see Note 14 to the Condensed Consolidated Financial Statements. Loans under SC’s personal lending platform have been classified as HFS and adjustments to lower of cost or market are recorded through Miscellaneous income, net on the Condensed Consolidated Statements of Operations. As of June 30, 2018, the carrying value of the personal unsecured HFS portfolio was $1.0 billion. Interest on loans is credited to income as it is earned. Loan origination fees and certain direct loan origination costs are deferred and recognized as adjustments to interest income in the Condensed Consolidated Statements of Operations over the contractual life of the loan utilizing the interest method. Loan origination costs and fees and premiums and discounts on RICs are deferred and recognized in interest income over their estimated lives using estimated prepayment speeds, which are updated on a monthly basis. At June 30, 2018 and December 31, 2017, accrued interest receivable on the Company's loans was $490.8 million and $515.9 million, respectively. During the six-month period ended June 30, 2018, the Company sold substantially all of its mortgage warehouse facilities, which had a book value of $499.2 million for net proceeds of $515.8 million. The $16.7 million gain on sale is recognized within Miscellaneous income, net on the Condensed Consolidated Statements of Operations. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Loan and Lease Portfolio Composition The following presents the composition of the gross loans and leases HFI by portfolio and by rate type:
(1)Total LHFI includes deferred loan fees, net of deferred origination costs and unamortized purchase premiums, net of discounts as well as purchase accounting adjustments. These items resulted in a net increase in the loan balances of $1.5 billion and $1.3 billion as of June 30, 2018 and December 31, 2017, respectively. (2)Other commercial includes commercial equipment vehicle financing ("CEVF") leveraged leases and loans. (3)Other consumer primarily includes recreational vehicle ("RV") and marine loans. Portfolio segments and classes Generally accepted accounting principles (“GAAP") require that entities disclose information about the credit quality of their financing receivables at disaggregated levels, specifically defined as “portfolio segments” and “classes,” based on management’s systematic methodology for determining the ACL. The Company utilizes similar categorization compared to the financial statement categorization of loans to model and calculate the ACL and track the credit quality, delinquency and impairment status of the underlying loan populations. In disaggregating its financing receivables portfolio, the Company’s methodology begins with the commercial and consumer segments. The commercial segmentation reflects line of business distinctions. The CRE line of business includes commercial and industrial owner-occupied real estate and specialized lending for investment real estate. The Company's allowance methodology further classifies loans in this line of business into construction and non-construction loans; however, the methodology for development and determination of the allowance is generally consistent between the two portfolios. "Commercial and industrial" includes non-real estate-related commercial and industrial loans. "Multifamily" represents loans for multifamily residential housing units. “Other commercial” includes loans to global customer relationships in Latin America which are not defined as commercial or consumer for regulatory purposes. The remainder of the portfolio primarily represents the CEVF business. The Company's portfolio classes are substantially the same as its financial statement categorization of loans for the consumer loan populations. “Residential mortgages” includes mortgages on residential property, including single family and 1-4 family units. "Home equity loans and lines of credit" include all organic home equity contracts and purchased home equity portfolios. "RICs and auto loans" includes the Company's direct automobile loan portfolios, but excludes recreational vehicle ("RV") and marine RICs. "Personal unsecured loans" includes personal revolving loans and credit cards. “Other consumer” includes an acquired portfolio of marine RICs and RV contracts as well as indirect auto loans. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) In accordance with the Company's accounting policy when establishing the collective ACL for originated loans, the Company's estimate of losses on recorded investment includes the estimate of the related net unaccreted discount balance that is expected at the time of charge-off, while it considers the entire unaccreted discount for loan portfolios purchased at a discount as available to absorb the credit losses when determining the ACL specific to these portfolios. This accounting policy is not applicable for the purchased loan portfolios acquired with evidence of credit deterioration, on which we elected to apply the FVO. The RIC and auto loan portfolio is comprised of: (1) RICs originated by SC prior to the first quarter 2014 consolidation and change in control of SC (the “Change in Control"), (2) RICs originated by SC after the Change in Control, and (3) auto loans originated by SBNA. The composition of the portfolio segment is as follows:
During the six-month periods ended June 30, 2018 and 2017, the Company originated $4.7 billion and $3.4 billion, respectively, in Chrysler Capital loans, which represented 49% and 43%, respectively, of the Company's total RIC originations (unpaid pricipal balance). As of June 30, 2018 and December 31, 2017, the Company's carrying value of auto RIC portfolio consisted of $8.0 billion and $8.2 billion, respectively, of Chrysler Capital loans, which represented 33% and 37%, respectively, of the Company's auto RIC portfolio. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) ACL Rollforward by Portfolio Segment The activity in the ACL by portfolio segment for the three-month and six-month periods ended June 30, 2018 and 2017 was as follows:
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued)
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) The following table presents the activity in the allowance for loan losses for the RICs acquired in the Change in Control and those originated by SC subsequent to the Change in Control.
Refer to Note 16 for discussion of contingencies and possible losses related to the impact of hurricane activity in regions where the Company has lending activities. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Non-accrual loans by Class of Financing Receivable The recorded investment in non-accrual loans disaggregated by class of financing receivables and other non-performing assets is summarized as follows:
Age Analysis of Past Due Loans The servicing practices for RICs originated after January 1, 2017 changed such that there is an increase in the minimum payment requirements. While this change does impact the measurement of customer delinquencies, we concluded that it does not have a significant impact on the amount or timing of the recognition of credit losses and allowance for loan losses. For reporting of past due loans, with respect to RICs originated through our "Chrysler Capital" channel, the required minimum payment is 90% of the scheduled payment. With respect to RICs originated by the Company or acquired from an unaffiliated third-party originator on or after January 1, 2017, the required minimum payment is 90% of the scheduled payment, whereas previous to January 1, 2017, the required minimum payment for certain RICs was 50% of the scheduled payment. The payment following the partial payment must be a full payment, or the account will move into delinquency status at that time. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) The age of recorded investments in past due loans and accruing loans 90 days or greater past due disaggregated by class of financing receivables is summarized as follows:
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Impaired Loans by Class of Financing Receivable Impaired loans are generally defined as all TDRs plus commercial non-accrual loans in excess of $1.0 million. Impaired loans disaggregated by class of financing receivables are summarized as follows:
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) The Company recognized interest income, not including the impact of purchase accounting adjustments, of $475.0 million for the six-month period ended June 30, 2018 on approximately $5.8 billion of TDRs that were in performing status as of June 30, 2018.
The Company recognized interest income, not including the impact of purchase accounting adjustments, of $795.4 million for the year ended December 31, 2017 on approximately $5.8 billion of TDRs that were in performing status as of December 31, 2017. Commercial Lending Asset Quality Indicators Commercial credit quality disaggregated by class of financing receivables is summarized according to standard regulatory classifications as follows: PASS. Asset is well-protected by the current net worth and paying capacity of the obligor or guarantors, if any, or by the fair value less costs to acquire and sell any underlying collateral in a timely manner. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) SPECIAL MENTION. Asset has potential weaknesses that deserve management’s close attention, which, if left uncorrected, may result in deterioration of the repayment prospects for an asset at some future date. Special mention assets are not adversely classified. SUBSTANDARD. Asset is inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. A well-defined weakness or weaknesses exist that jeopardize the liquidation of the debt. The loans are characterized by the distinct possibility that the Company will sustain some loss if deficiencies are not corrected. DOUBTFUL. Exhibits the inherent weaknesses of a substandard credit. Additional characteristics exist that make collection or liquidation in full highly questionable and improbable, on the basis of currently known facts, conditions and values. Possibility of loss is extremely high, but because of certain important and reasonable specific pending factors which may work to the advantage and strengthening of the credit, an estimated loss cannot yet be determined. LOSS. Credit is considered uncollectible and of such little value that it does not warrant consideration as an active asset. There may be some recovery or salvage value, but there is doubt as to whether, how much or when the recovery would occur. Commercial loan credit quality indicators by class of financing receivables are summarized as follows:
Consumer Lending Asset Quality Indicators-Credit Score Consumer financing receivables for which either an internal or external credit score is a core component of the allowance model are summarized by credit score as follows:
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Consumer Lending Asset Quality Indicators-FICO and LTV Ratio For both residential and home equity loans, loss severity assumptions are incorporated in the loan and lease loss reserve models to estimate loan balances that will ultimately charge off. These assumptions are based on recent loss experience within various current LTV bands within these portfolios. LTVs are refreshed quarterly by applying Federal Housing Finance Agency Home price index changes at a state-by-state level to the last known appraised value of the property to estimate the current LTV. The Company's ALLL incorporates the refreshed LTV information to update the distribution of defaulted loans by LTV as well as the associated loss given default for each LTV band. Reappraisals on a recurring basis at the individual property level are not considered cost-effective or necessary; however, reappraisals are performed on certain higher risk accounts to support line management activities, default servicing decisions, or when other situations arise for which the Company believes the additional expense is warranted. Residential mortgage and home equity financing receivables by LTV and FICO range are summarized as follows:
(1) Includes LHFS. (2) Residential mortgages and home equity loans and lines of credit in the "N/A" range for LTV or FICO score primarily represent the balance on loans serviced by others, in run-off portfolios or for which a current LTV or FICO score is unavailable. (3) Allowance model considers LTV for financing receivables in first lien position for the Company and combined LTV ("CLTV") for financing receivables in second lien position for the Company.
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued)
TDR Loans The following table summarizes the Company’s performing and non-performing TDRs at the dates indicated:
Commercial Loan TDRs All of the Company’s commercial loan modifications are based on the circumstances of the individual customer, including specific customers' complete relationships with the Company. Loan terms are modified to meet each borrower’s specific circumstances at a point in time and may allow for modifications such as term extensions and interest rate reductions. Modifications for commercial loan TDRs generally, although not always, result in bifurcation of the original loan into A and B notes. The A note is restructured to allow for upgraded risk rating and return to accrual status after a sustained period of payment performance has been achieved (typically six months for monthly payment schedules). The B note, if any, is structured as a deficiency note; the balance is charged off but the debt is usually not forgiven. Commercial TDRs are generally placed on non-accrual status until the Company believes repayment under the revised terms is reasonably assured and a sustained period of repayment performance has been achieved (typically six months for a monthly amortizing loan). TDRs are subject to analysis for specific reserves by either calculating the present value of expected future cash flows or, if collateral-dependent, calculating the fair value of the collateral less its estimated cost to sell. The TDR classification will remain on the loan until it is paid in full or liquidated. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Consumer Loan TDRs The primary modification program for the Company’s residential mortgage and home equity portfolios is a proprietary program designed to keep customers in their homes and, when appropriate, prevent them from entering into foreclosure. The program is available to all customers facing a financial hardship regardless of their delinquency status. The main goal of the modification program is to review the customer’s entire financial condition to ensure that the proposed modified payment solution is affordable according to a specific debt-to-income (“DTI") ratio range. The main modification benefits of the program allow for term extensions, interest rate reductions, and/or deferment of principal. The Company reviews each customer on a case-by-case basis to determine which benefit or combination of benefits will be offered to achieve the target DTI range. For the Company’s other consumer portfolios, including RICs and auto loans, the terms of the modifications generally include one or a combination of: a reduction of the stated interest rate of the loan to a rate of interest lower than the current market rate for new debt with similar risk, an extension of the maturity date or principal forgiveness. Consumer TDRs excluding RICs are generally placed on non-accrual status until the Company believes repayment under the revised terms is reasonably assured and a sustained period of repayment performance has been achieved (typically six months for a monthly amortizing loan). Any loan that has remained current for the six months immediately prior to modification will remain on accrual status after the modification is implemented. RIC TDRs are placed on nonaccrual status when the Company believes repayment under the revised terms is not reasonably assured, and considered for return to accrual when a sustained period of repayment performance has been achieved. The TDR classification will remain on the loan until it is paid in full or liquidated. In addition to loans identified as TDRs above, the guidance also requires loans discharged under Chapter 7 bankruptcy proceedings to be considered TDRs and collateral-dependent, regardless of delinquency status. TDRs that are collateral-dependent loans must be written down to the fair market value of the collateral, less costs to sell and classified as non-accrual/non-performing loans (“NPLs") for the remaining life of the loan. TDR Impact to ALLL The ALLL is established to recognize losses inherent in funded loans intended to be HFI that are probable and can be reasonably estimated. Prior to loans being placed in TDR status, the Company generally measures its allowance under a loss contingency methodology in which consumer loans with similar risk characteristics are pooled and loss experience information is monitored for credit risk and deterioration with statistical tools considering factors such as delinquency, LTV and credit scores. Upon TDR modification, the Company generally measures impairment based on a present value of expected future cash flows methodology considering all available evidence, by discounting expected future cash flows using the original effective interest rate or fair value of collateral less costs to sell. The amount of the required ALLL is equal to the difference between the loan’s impaired value and the recorded investment. RIC TDRs that subsequently default continue to have impairment measured based on the difference between the recorded investment of the RIC and the present value of expected cash flows. For the Company's other consumer TDR portfolios, impairment on subsequent defaults is generally measured based on the fair value of the collateral, if applicable, less its estimated cost to sell. Typically, commercial loans whose terms are modified in a TDR will have been identified as impaired prior to modification and accounted for generally using a present value of expected future cash flows methodology, unless the loan is considered collateral-dependent. Loans considered collateral-dependent are measured for impairment based on their fair values of collateral less estimated cost to sell. Accordingly, upon TDR modification or if a TDR modification subsequently defaults, the allowance methodology remains unchanged. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Financial Impact and TDRs by Concession Type The following tables detail the activity of TDRs for the three-month and six-month periods ended June 30, 2018 and 2017, respectively:
(1) Pre-TDR modification outstanding recorded investment amount is the month-end balance prior to the month in which the modification occurred. (2) Post-TDR modification outstanding recorded investment amount is the month-end balance for the month in which the modification occurred. (3) The post-TDR modification outstanding recorded investment amounts for residential mortgages exclude interest reserves. (4) Other modifications may include modifications such as interest rate reductions, fee waivers, or capitalization of fees. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued)
(1) Pre-TDR modification outstanding recorded investment amount is the month-end balance prior to the month in which the modification occurred.
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) TDRs Which Have Subsequently Defaulted A TDR is generally considered to have subsequently defaulted if, after modification, the loan becomes 90 days past due. For RICs, a TDR is considered to have subsequently defaulted after modification at the earlier of the date of repossession or 120 days past due. The following table details period-end recorded investment balances of TDRs that became TDRs during the past twelve-month period and have subsequently defaulted during the three-month and six-month periods ended June 30, 2018 and June 30, 2017, respectively.
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OPERATING LEASE ASSETS, NET |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OPERATING LEASE ASSETS, NET | OPERATING LEASE ASSETS, NET The Company has operating leases which are included in the Company's Condensed Consolidated Balance Sheets as Operating lease assets, net. The leased vehicle portfolio consists primarily of leases originated under the Chrysler Agreement. Operating lease assets, net consisted of the following as of June 30, 2018 and December 31, 2017:
NOTE 5. OPERATING LEASE ASSETS, NET (continued) The following summarizes the future minimum rental payments due to the Company as lessor under operating leases as of June 30, 2018 (in thousands):
Lease income for the three-month and six-month periods ended June 30, 2018 was $569.3 million and $1.1 billion, respectively, compared to $489.0 million and $985.1 million, respectively, for the three-month and six-month periods ended June 30, 2017. During the three-month and six-month periods ended June 30, 2018, the Company recognized $65.7 million and $118.9 million, respectively, of net gains on the sale of operating lease assets that had been returned to the Company at the end of the lease term compared to $39.8 million and $62.5 million for the corresponding periods in 2017, respectively. These amounts are recorded within Miscellaneous income, net in the Company's Condensed Consolidated Statements of Operations. Lease expense for the three-month and six-month periods ended June 30, 2018 was $436.8 million and $861.1 million, respectively, compared to $369.2 million and $728.0 million respectively, for the three-month and six-month periods ended June 30, 2017. |
VIEs |
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Variable Interest Entity and Securitizations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
VIEs | VIEs The Company transfers RICs and vehicle leases into newly-formed Trusts that then issue one or more classes of notes payable backed by the collateral. The Company’s continuing involvement with these Trusts is in the form of servicing the assets and, generally, through holding residual interests in the Trusts. The Trusts are considered VIEs under GAAP, and the Company may or may not consolidate these VIEs in the Condensed Consolidated Financial Statements. For further description of the Company’s securitization activities, involvement with VIEs and accounting policies regarding consolidation of VIEs, see Note 7 of its Annual Report on Form 10-K for 2017. On-balance sheet VIEs The assets of consolidated VIEs that are included in the Company's Condensed Consolidated Financial Statements, presented reflecting the transfer of the underlying assets in order to reflect legal ownership, that can be used to settle obligations of the consolidated VIEs and the liabilities of these consolidated entities for which creditors (or beneficial interest holders) do not have recourse to our general credit were as follows:
(1) Includes $63.9 million and $1.1 billion of RICs HFS at June 30, 2018 and December 31, 2017, respectively. (2) Reflects the impacts of purchase accounting. NOTE 6. VIEs (continued) Certain amounts shown above are greater than the amounts shown in the corresponding line items in the accompanying Condensed Consolidated Balance Sheets due to intercompany eliminations between the VIEs and other entities consolidated by the Company. The amounts shown above are also impacted by purchase accounting marks from the Change in Control. For example, for most of its securitizations, the Company retains one or more of the lowest tranches of bonds. Rather than showing investment in bonds as an asset and the associated debt as a liability, these amounts are eliminated in consolidation as required by GAAP. The Company retains servicing responsibility for receivables transferred to the Trusts and receives a monthly servicing fee on the outstanding principal balance. Supplemental fees, such as late charges, for servicing the receivables are reflected in Miscellaneous income. As of June 30, 2018 and December 31, 2017, the Company was servicing $26.3 billion and $26.1 billion, respectively, of RICs that have been transferred to consolidated Trusts. The remainder of the Company’s RICs remains unpledged. Below is a summary of the cash flows received from the on-balance sheet Trusts for the periods indicated:
(1) Includes additional advances on existing securitizations. (2) These amounts are not reflected in the accompanying Condensed Consolidated SCF because the cash flows are between the VIEs and other entities included in the consolidation. Off-balance sheet VIEs During the three- and six-month periods ended June 30, 2018, the Company sold $1.2 billion and $2.6 billion of gross RICs to VIEs in off-balance sheet securitizations for a loss of $3.2 million and $20.1 million, respectively. During the three and six months ended June 30, 2017, the Company sold $0.5 billion and $1.2 billion of gross RICs to VIEs in off-balance sheet securitizations for a loss of $3.5 million and $6.2 million, respectively. The transactions were executed under securitization platforms with Santander. Santander holds eligible vertical interests in notes and certificates of not less than 5% to comply with the DFA's risk retention rules. As of June 30, 2018 and December 31, 2017, the Company was servicing $4.9 billion and $3.4 billion, respectively, of gross RICs that have been sold in off-balance sheet securitizations and were subject to an optional clean-up call. The portfolio was comprised as follows:
Other than repurchases of sold assets due to standard representations and warranties, the Company has no exposure to loss as a result of its involvement with these VIEs. NOTE 6. VIEs (continued) A summary of the cash flows received from the off-balance sheet Trusts for the periods indicated is as follows:
(1) Represents the UPB at the time of original securitization. |
GOODWILL AND OTHER INTANGIBLES |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLES | GOODWILL AND OTHER INTANGIBLES Goodwill The following table presents the Company's goodwill by its reporting units at June 30, 2018:
During the second quarter of 2018, Santander renamed its Global and Corporate Banking ("GCB") business to Corporate and Investment Banking (CIB) to more accurately reflect its business strategy and business proposition to clients, and to align with the name used by a majority of its competitors in the industry. There were no changes to composition of the reportable segment or reporting unit as a result of this change. There were no re-allocations of goodwill for the three-month period ended June 30, 2018. During the first quarter of 2018, the reportable segments (and reporting units) formerly known as Commercial Banking and CRE were combined and presented as Commercial Banking. Refer to Note 18 for further discussion on the change in reportable segments. There were no additions or removals of underlying lines of business in connection with this reporting change. As a result, goodwill assigned to these former reporting units of $542.6 million and $870.4 million, for Commercial Banking and CRE, respectively, have been combined. There were no additions or impairments of goodwill for the three-month and six-month periods ended June 30, 2018. There were no additions, impairments, or re-allocations of goodwill for the three-month or six-month periods ended June 30, 2017. The Company conducted its last annual goodwill impairment tests as of October 1, 2017 using generally accepted valuation methods. After conducting an analysis of the fair value of each reporting unit as of October 1, 2017, the Company determined that the full amount of goodwill attributed to Santander BanCorp of $10.5 million was impaired and, as a result, it was written-off, primarily due to the unfavorable economic environment in Puerto Rico and the additional adverse effects of Hurricane Maria. No impairments of goodwill attributed to other reporting units were identified. Other Intangible Assets The following table details amounts related to the Company's intangible assets subject to amortization for the dates indicated. NOTE 7. GOODWILL AND OTHER INTANGIBLES (continued)
At June 30, 2018 and December 31, 2017, the Company did not have any intangibles, other than goodwill, that were not subject to amortization. Amortization expense on intangible assets was $15.3 million and $30.6 million and for the three-month and six-month periods ended June 30, 2018, respectively, and $15.4 million and $30.9 million for the three-month and six-month periods ended June 30, 2017, respectively. The estimated aggregate amortization expense related to intangibles, excluding any impairment charges, for each of the five succeeding calendar years ending December 31 is:
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OTHER ASSETS |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OTHER ASSETS | OTHER ASSETS The following is a detail of items that comprise other assets at June 30, 2018 and December 31, 2017:
Income tax receivables Income tax receivables consists primarily of accrued federal tax receivables. NOTE 8. OTHER ASSETS (continued) Derivative assets at fair value Derivative assets at fair value represent the net amount of derivatives presented in the Condensed Consolidated Financial Statements, including the impact of amounts offsetting recognized assets. Refer to the offsetting of financial assets table in Note 12 to these Condensed Consolidated Financial Statements for the detail of these amounts. Other repossessed assets and OREO Other repossessed assets primarily consist of leased assets that have been terminated and are included as grounded inventory, which is obtained through repossession. OREO consists primarily of the Company's foreclosed properties. MSRs The Company maintains an MSR asset for sold residential real estate loans serviced for others. At June 30, 2018 and December 31, 2017, the balance of these loans serviced for others accounted for at fair value was $14.6 billion and $14.9 billion, respectively. The Company accounts for a majority of its residential MSRs using the FVO. Changes in fair value are recorded through Miscellaneous income, net on the Condensed Consolidated Statements of Operations. The fair value of the MSRs at June 30, 2018 and December 31, 2017 were $158.5 million and $146.0 million, respectively. See further discussion on the valuation of the MSRs in Note 14. As deemed appropriate, the Company economically hedges MSRs using interest rate swaps and forward contracts to purchase MBS. See further discussion on these derivative activities in Note 12 to these Condensed Consolidated Financial Statements. The remainder of MSRs not accounted for using the FVO are accounted for at lower of cost or market. For the three-month and six-month periods ended June 30, 2018, the Company recorded net changes in the fair value of MSRs due to valuation totaling $(1.3) million and $13.8 million, respectively, compared to $(1.2) million and $0.3 million for the corresponding periods in 2017. The following table presents a summary of activity for the Company's residential MSRs that are included in the Condensed Consolidated Balance Sheets:
Deferred tax assets, net The Company generates deferred tax assets from its normal operating and investing activities. These include deferred tax assets arising from business credits and carryforwards as well as timing difference related to the mark-to-market adjustments on investments recorded at fair value and recording of the allowance for loan losses. Refer to Note 13 of these Condensed Consolidated Financial Statements for more information on tax-related activities. Equity method investments The Company makes certain equity investments in various limited partnerships, some of which are considered VIEs, that invest in and lend to qualified community development entities, such as renewable energy investments, through the New Market Tax Credits ("NMTC") and CRA programs. The Company acts only in a limited partner capacity in connection with these partnerships, so the Company has determined that it is not the primary beneficiary of the partnerships because it does not have the power to direct the activities of the partnerships that most significantly impact the partnerships' economic performance. NOTE 8. OTHER ASSETS (continued) Miscellaneous assets and receivables Miscellaneous assets and receivables includes subvention receivables in connection with the Chrysler Agreement, investment and capital market receivables, derivatives trading receivables and unapplied payments. The second quarter increase is due to increases in subvention receivables and due from others, primarily at SIS, offset by decreases in investment receivables and wire transfer clearing. |
DEPOSITS AND OTHER CUSTOMER ACCOUNTS |
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Deposits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEPOSITS AND OTHER CUSTOMER ACCOUNTS | DEPOSITS AND OTHER CUSTOMER ACCOUNTS Deposits and other customer accounts are summarized as follows:
Deposits collateralized by investment securities, loans, and other financial instruments totaled $2.3 billion and $2.3 billion at June 30, 2018 and December 31, 2017, respectively. Demand deposit overdrafts that have been reclassified as loan balances were $107.6 million and $38.9 million at June 30, 2018 and December 31, 2017, respectively. At June 30, 2018 and December 31, 2017, the Company had $1.6 billion and $1.3 billion of CDs greater than $250 thousand. |
BORROWINGS |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BORROWINGS | BORROWINGS Total borrowings and other debt obligations at June 30, 2018 were $38.8 billion, compared to $39.0 billion at December 31, 2017. The Company's debt agreements impose certain limitations on dividends other payments and transactions. The Company is currently in compliance with these limitations. Periodically, as part of the Company's wholesale funding management, it opportunistically repurchases outstanding borrowings in the open market and subsequently retires the obligations. Bank The Bank had no new securities issuances and did not repurchase any outstanding borrowings in the open market during the three-month and six-month periods ended June 30, 2018. SHUSA During the first quarter of 2018, the Company repurchased $63.2 million of its 3.45% senior notes due 2018 and $336.8 million of its 2.70% senior notes due 2019. During the second quarter of 2018, the Company issued $427.9 million of senior floating rate notes in a private offering. These notes have a floating rate equal to the three-month London Interbank Offered Rate ("LIBOR") plus 100 basis points. The proceeds of these notes will be used for general corporate purposes. NOTE 10. BORROWINGS (continued) The Company recorded loss on debt extinguishment of $1.2 million and $3.4 million for the three-month and six-month periods ended June 30, 2018, respectively, which include amounts related to debt repurchases and early repayments at SHUSA and the Bank, compared to $4.0 million and $10.7 million for the three-month and six-month periods ended June 30, 2017, respectively. On July 2, 2018, the Company completed a cash tender offer for $484.5 million of its outstanding $663.2 million 2.700% Senior Notes Due 2019. On July 19, 2018, SHUSA's Board of Directors approved the redemption of Sovereign Capital Trust IX junior subordinated debentures and common securities. The redemption is expect to occur in October 2018 consistent with the terms of the trust. Parent Company and other IHC Entities Borrowings and Debt Obligations The following table presents information regarding the Parent Company and its subsidiaries' borrowings and other debt obligations at the dates indicated:
(1) These notes bear interest at a rate equal to the three-month LIBOR plus 100 basis points per annum. (2) These notes will bear interest at a rate equal to the three-month LIBOR plus 105 basis points per annum. NOTE 10. BORROWINGS (continued) Bank Borrowings and Debt Obligations The following table presents information regarding the Bank's borrowings and other debt obligations at the dates indicated:
The Bank had outstanding irrevocable letters of credit totaling $560.5 million from the FHLB of Pittsburgh at June 30, 2018, used to secure uninsured deposits placed with the Bank by state and local governments and their political subdivisions. Revolving Credit Facilities The following tables present information regarding SC's credit facilities as of June 30, 2018 and December 31, 2017:
(3) The maturity of this repurchase facility ranges from July 2018 to September 2018. Approximately 38% of this matured and settled in July 2018.
(5) This repurchase facility was settled on maturity in July 2018.
NOTE 10. BORROWINGS (continued)
Secured Structured Financings The following tables present information regarding SC's secured structured financings as of June 30, 2018 and December 31, 2017:
(1) Securitizations executed under Rule 144A of the Securities Act are included within this balance. (2) Secured structured financings may be collateralized by the SC's collateral overages of other issuances. NOTE 10. BORROWINGS (continued)
(1) SC has entered into various securitization transactions involving its retail automobile installment loans and leases. These transactions are accounted for as secured financings and therefore both the securitized RICs and the related securitization debt issued by SPEs remain on the Condensed Consolidated Balance Sheets. The maturity of this debt is based on the timing of repayments from the securitized assets. (2) Securitizations executed under Rule 144A of the Securities Act are included within this balance. Most of SC's secured structured financings are in the form of public, SEC-registered securitizations. SC also executes private securitizations under Rule 144A of the Securities Act, and periodically issues private term amortizing notes, which are structured similarly to securitizations but are acquired by banks and conduits. SC's securitizations and private issuances are collateralized by RICs or vehicle leases. As of June 30, 2018 and December 31, 2017, SC had private issuances of notes backed by vehicle leases outstanding totaling $6.0 billion and $3.7 billion, respectively. |
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) The following table presents the components of accumulated other comprehensive income/(loss), net of related tax, for the three-month and six-month periods ended June 30, 2018 and 2017, respectively.
(4) Includes impact of other comprehensive income reclassified to Retained earnings as a result of the adoption of ASU 2018-02. Refer to Note 1 for further discussion. NOTE 11. ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (continued)
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DERIVATIVES |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVES | DERIVATIVES General The Company uses derivative financial instruments primarily to manage exposure to interest rate, foreign exchange, equity and credit risk, as well as to manage the effects that changes in interest rates may have on net income, the fair value of assets and liabilities, and cash flows. The Company also enters into derivatives with customers to facilitate their risk management activities, and often sells commercial loan customers derivative products to hedge interest rate risk associated with loans made to them by the Bank. The Company uses derivative financial instruments as risk management tools and not for speculative trading purposes for its own account. The fair value of all derivative balances is recorded within Other assets and Other liabilities on the Condensed Consolidated Balance Sheets. See Note 14 for discussion of the valuation methodology for derivative instruments. Derivatives represent contracts between parties that usually require little or no initial net investment and result in one or both parties delivering cash or another type of asset to the other party based on a notional amount and an underlying asset, index, interest rate or future purchase commitment or option as specified in the contract. Derivative transactions are often measured in terms of notional amount, but this amount is generally not exchanged, is not recorded on the balance sheet, and does not represent the Company`s exposure to credit loss. The notional amount is the basis on which the financial obligation of each party to the derivative contract is calculated to determine required payments under the contract. The Company controls the credit risk of its derivative contracts through credit approvals, limits and monitoring procedures. The underlying asset is typically a referenced interest rate (commonly the Overnight Indexed Swap ("OIS") rate or LIBOR), security, credit spread or index. The Company’s capital markets and mortgage banking activities are subject to price risk. The Company employs various tools to measure and manage price risk in its portfolios. In addition, the Board of Directors has established certain limits relative to positions and activities. The level of price risk exposure at any given time depends on the market environment and expectations of future price and market movements and will vary from period to period. Credit Risk Contingent Features The Company has entered into certain derivative contracts that require the posting of collateral to counterparties when those contracts are in a net liability position. The amount of collateral to be posted is based on the amount of the net liability and thresholds generally related to the Company's long-term senior unsecured credit ratings. In a limited number of instances, counterparties also have the right to terminate their International Swaps and Derivatives Association, Inc. ("ISDA") Master Agreements if the Company's ratings fall below a specified level, typically investment grade. As of June 30, 2018, derivatives in this category had a fair value of $1.5 million. The credit ratings of the Company and the Bank are currently considered investment grade. During the second quarter of 2018, no additional collateral would be required if there were a further 1- or 2- notch downgrade by either Standard & Poor's ("S&P") or Moody's Investor Services ("Moody's"). As of June 30, 2018 and December 31, 2017, the aggregate fair value of all derivative contracts with credit risk contingent features (i.e., those containing collateral posting or termination provisions based on the Company's ratings) that were in a net liability position totaled $10.6 million and $10.4 million, respectively. The Company had $11.9 million and $15.7 million in cash and securities collateral posted to cover those positions as of June 30, 2018 and December 31, 2017, respectively. NOTE 12. DERIVATIVES (continued) Hedge Accounting Management uses derivative instruments designated as hedges to mitigate the impact of interest rate and foreign exchange rate movements on the fair value of certain assets and liabilities and on highly probable forecasted cash flows. These instruments primarily include interest rate swaps that have underlying interest rates based on key benchmark indices. The nature and volume of the derivative instruments used to manage interest rate risk depend on the level and type of assets and liabilities on the balance sheet and the risk management strategies for the current and anticipated interest rate environment. Interest rate swaps are generally used to convert fixed-rate assets and liabilities to variable rate assets and liabilities and vice versa. The Company utilizes interest rate swaps that have a high degree of correlation to the related financial instrument. Cash Flow Hedges The Company has outstanding interest rate swap agreements designed to hedge a portion of the Company’s floating rate assets and liabilities (including its borrowed funds). All of these swaps have been deemed highly effective cash flow hedges. The gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings and is presented in the same Consolidated Statements of Operations line item as the earnings effect of the hedged item. The last of the hedges is scheduled to expire in December 2030. The Company includes all components of each derivative's gain or loss in the assessment of hedge effectiveness. As of June 30, 2018, the Company expected $41.5 million of gains/losses recorded in accumulated other comprehensive loss to be reclassified to earnings during the subsequent twelve months as the future cash flows occur. Derivatives Designated in Hedge Relationships – Notional and Fair Values Derivatives designated as accounting hedges at June 30, 2018 and December 31, 2017 included:
Other Derivative Activities The Company also enters into derivatives that are not designated as accounting hedges under GAAP. The majority of these derivatives are customer-related derivatives relating to foreign exchange and lending arrangements, as well as derivatives to hedge interest rate risk on SC's secured structured financings and the borrowings under its revolving credit facilities. SC uses both interest rate swaps and interest rate caps to satisfy these requirements and to hedge the variability of cash flows on securities issued by Trusts and borrowings under its warehouse facilities. In addition, derivatives are used to manage risks related to residential and commercial mortgage banking and investing activities. Although these derivatives are used to hedge risk and are considered economic hedges, they are not designated as accounting hedges because the contracts they are hedging are carried at fair value on the balance sheet, resulting in generally symmetrical accounting treatment for the hedging instrument and the hedged item. NOTE 12. DERIVATIVES (continued) Mortgage Banking Derivatives The Company's derivatives portfolio includes mortgage banking interest rate lock commitments, forward sale commitments and interest rate swaps. As part of its overall business strategy, the Company originates fixed-rate and adjustable rate residential mortgages. It sells a portion of this production to the FHLMC, FNMA, and private investors. The Company uses forward sales as a means of hedging against the economic impact of changes in interest rates on the mortgages that are originated for sale and on interest rate lock commitments. The Company typically retains the servicing rights related to residential mortgage loans that are sold. Most of the Company`s residential MSRs are accounted for at fair value. As deemed appropriate, the Company economically hedges MSRs using interest rate swaps and forward contracts to purchase MBS. Customer-related derivatives The Company offers derivatives to its customers in connection with their risk management needs and requirements. These financial derivative transactions primarily consist of interest rate swaps, caps, floors and foreign exchange contracts. Risk exposure from customer positions is managed through transactions with other dealers, including Santander. Other derivative activities The Company uses foreign exchange contracts to manage the foreign exchange risk associated with certain foreign currency-denominated assets and liabilities. Foreign exchange contracts, which include spot and forward contracts as well as cross-currency swaps, represent agreements to exchange the currency of one country for the currency of another country at an agreed-upon price on an agreed-upon settlement date and may or may not be physically settled depending on the Company’s needs. Exposure to gains and losses on these contracts will increase or decrease over their respective lives as currency exchange and interest rates fluctuate. Other derivative instruments primarily include forward contracts related to certain investment securities sales, an overnight indexed swap, a total return swap on Visa, Inc. Class B common shares, and equity options, which manage the Company's market risk associated with certain investments and customer deposit products. NOTE 12. DERIVATIVES (continued) Derivatives Not Designated in Hedge Relationships – Notional and Fair Values Other derivative activities at June 30, 2018 and December 31, 2017 included:
NOTE 12. DERIVATIVES (continued) Gains (Losses) on All Derivatives The following Condensed Consolidated Statement of Operations line items were impacted by the Company’s derivative activities for the three-month and six-month periods ended June 30, 2018 and 2017:
The net amount of change recognized in Other comprehensive income for cash flow hedge derivatives were losses of $15.2 million and $31.4 million, net of tax, for the three-month and six-month periods ended June 30, 2018, respectively, and gains of $9.6 million and $8.7 million for the three-month and six-month periods ended June 30, 2017. The amount of gain reclassified from Other comprehensive income into earnings for cash flow hedge derivatives was $10.4 million and $9.3 million, net of tax, for the three-month and six-month periods ended June 30, 2018, respectively, and the amount of loss reclassified from Other comprehensive income into earnings for cash flow hedge derivatives was $3.1 million and $4.7 million, net of tax, for the three-month and six-month periods ended June 30, 2017. Disclosures about Offsetting Assets and Liabilities The Company enters into legally enforceable master netting agreements, which reduce risk by permitting netting of transactions with the same counterparty on the occurrence of certain events. A master netting agreement allows two counterparties the ability to net-settle amounts under all contracts, including any related collateral posted, through a single payment and in a single currency. The right to offset and certain terms regarding the collateral process, such as valuation, credit events and settlement, are contained in the ISDA Master Agreement. The Company's financial instruments, including resell and repurchase agreements, securities lending arrangements, derivatives and cash collateral, may be eligible for offset on its Condensed Consolidated Balance Sheets. The Company has elected to present derivative balances on a gross basis even if the derivative is subject to a legally enforceable nettable ISDA Master Agreement for all trades executed after April 1, 2013. Collateral that is received or pledged for these transactions is disclosed within the “Gross amounts not offset in the Condensed Consolidated Balance Sheets” section of the tables below. Prior to April 1, 2013, the Company had elected to net all caps, floors, and interest rate swaps when it had an ISDA Master Agreement with the counterparty. The collateral received or pledged in connection with these transactions is disclosed within the “Gross amounts offset in the Condensed Consolidated Balance Sheets" section of the tables below. NOTE 12. DERIVATIVES (continued) Information about financial assets and liabilities that are eligible for offset on the Condensed Consolidated Balance Sheet as of June 30, 2018 and December 31, 2017, respectively, is presented in the following tables:
NOTE 12. DERIVATIVES (continued)
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INCOME TAXES |
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Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES An income tax provision of $168.0 million and $263.4 million was recorded for the three-month and six-month periods ended June 30, 2018, respectively, compared to $92.0 million and $170.9 million for the corresponding periods in 2017. This resulted in an effective tax rate ("ETR") of 31.9% and 29.9% for the three-month and six-month periods ended June 30, 2018, respectively, compared to 24.2% and 27.5% for the corresponding periods in 2017. The increase in the ETR for the three-month and six-month periods ended June 30, 2018 is primarily due to the tax benefit recognized during the three month period ended June 30, 2017 upon the assertion that undistributed earnings of a Puerto Rico subsidiary would be indefinitely reinvested outside the U.S. During the three months ended December 31, 2017, the Company changed its assertion to reflect a change in management’s strategic objective to no longer permanently reinvest the earnings. The increase was partially offset by the reduction in the federal corporate income tax rate as a result of the TCJA. The Company is subject to the income tax laws of the U.S., its states and municipalities and certain foreign countries. These tax laws are complex and are potentially subject to different interpretations by the taxpayer and the relevant governmental taxing authorities. In establishing a provision for income tax expense, the Company must make judgments and interpretations about the application of these inherently complex tax laws. NOTE 13. INCOME TAXES (continued) Actual income taxes paid may vary from estimates depending upon changes in income tax laws, actual results of operations, and the final audit of tax returns by taxing authorities. Tax assessments may arise several years after tax returns have been filed. The Company reviews its tax balances quarterly and, as new information becomes available, the balances are adjusted as appropriate. The Company is subject to ongoing tax examinations and assessments in various jurisdictions. As noted above, the TCJA, among other things, reduced the federal corporate income tax rate from 35% to 21%. Due to the complexities involved in accounting for the enactment of the TCJA, SEC Staff Accounting Bulletin (“SAB”) 118 specifies, among other things, that reasonable estimates of the income tax effects of the TCJA should be used, if determinable. Further, SAB 118 clarifies accounting for income taxes under ASC Topic 740, Income Taxes (ASC 740), if information is not yet available or complete and provides for up to a one-year period in which to complete the required analyses and accounting (the measurement period). The Company has obtained and analyzed all currently available information to record the effect of the change in tax law. While we were able to make a reasonable estimate of the impact of the reduction in the corporate tax rate and the other provisions of the TCJA, the accounting may be impacted by other analyses related to the TCJA, technical corrections or other amendments to the TCJA, and further accounting or administrative tax guidance. The Company filed a lawsuit against the United States in 2009 in Federal District Court in Massachusetts relating to the proper tax consequences of two financing transactions with an international bank through which the Company borrowed $1.2 billion. As a result of these financing transactions, the Company paid foreign taxes of $264.0 million during the years 2003 through 2007 and claimed a corresponding foreign tax credit for foreign taxes paid during those years, which the Internal Revenue Service ("IRS") disallowed. The IRS also disallowed the Company's deductions for interest expense and transaction costs, totaling $74.6 million in tax liability, and assessed penalties and interest totaling approximately $92.5 million. The Company has paid the taxes, penalties and interest associated with the IRS adjustments for all tax years, and the lawsuit will determine whether the Company is entitled to a refund of the amounts paid. In November 2015, the Federal District Court granted the Company's motions for summary judgment and later ordered amounts assessed by the IRS for the years 2003 through 2005 to be refunded to the Company. The IRS appealed that judgment, and the U.S. Court of Appeals for the First Circuit partially reversed the judgment of the Federal District Court, finding that the Company is not entitled to claim the foreign tax credits it claimed but will be allowed to exclude from income $132.0 million (representing half of the U.K. taxes the Company paid) and will be allowed to claim the interest expense deductions. The case was remanded to the Federal District Court for further proceedings to determine, among other issues, whether penalties should be sustained. Upon remand, the Company filed motions for summary judgment regarding the remaining issues; however, on July 17, 2018, the Court denied the Company’s motions. The Company is currently assessing its legal options. In response to the First Circuit's decision, at December 31, 2016, the Company used its previously established $230.1 million tax reserve to write off deferred tax assets and a portion of the receivable that would not be realized under the Court's decision. Additionally, the Company established a $36.8 million tax reserve in relation to items that have not yet been determined by the courts, including potential penalties. Over the next 12 months, it is reasonably possible that changes in the reserve for uncertain tax positions could range from a decrease of $36.8 million to no change. With few exceptions, the Company is no longer subject to federal, state and non-U.S. income tax examinations by tax authorities for years prior to 2006. The Company applies an aggregate portfolio approach whereby income tax effects from accumulated other comprehensive income are released only when an entire portfolio (i.e., all related units of account) of a particular type is liquidated, sold or extinguished. The Company had a net deferred tax liability balance of $382.8 million at June 30, 2018 (consisting of a deferred tax asset balance of $761.2 million and a deferred tax liability balance of $1.1 billion), compared to a net deferred tax liability balance of $198.3 million at December 31, 2017 (consisting of a deferred tax asset balance of $771.7 million and a deferred tax liability balance of $970.0 million). The $184.5 million increase in net deferred liabilities for the six-month period ended June 30, 2018 was primarily due to an increase in deferred tax liabilities related to accelerated depreciation from leasing transactions; an increase in the deferred tax asset valuation allowance; and a decrease in deferred tax assets on loans marked to market for income tax purposes partially offset by an increase in deferred tax assets related to net operating losses. |
FAIR VALUE |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE | FAIR VALUE General A portion of the Company’s assets and liabilities are carried at fair value, including AFS investment securities and derivative instruments. In addition, the Company elects to account for its residential mortgages HFS and a portion of its MSRs at fair value. Fair value is also used on a nonrecurring basis to evaluate certain assets for impairment or for disclosure purposes. Examples of nonrecurring uses of fair value include impairments for certain loans and foreclosed assets. As of June 30, 2018, $14.3 billion of the Company’s total assets consisted of financial instruments measured at fair value on a recurring basis, including financial instruments for which the Company elected the FVO. Approximately $342.0 million of these financial assets were measured using quoted market prices for identical instruments, or Level 1 inputs. Approximately $13.3 billion of these financial assets were measured using valuation methodologies involving market-based and market-derived information, or Level 2 inputs. Approximately $659.8 million of these financial assets were measured using model-based techniques, or Level 3 inputs, and represented approximately 4.6% of total assets measured at fair value on a recurring basis and approximately 0.5% of total consolidated assets. Fair value is defined in GAAP as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard focuses on the exit price in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. GAAP establishes a fair value reporting hierarchy to maximize the use of observable inputs when measuring fair value and defines the three levels of inputs as noted below: •Level 1 - Assets or liabilities for which the identical item is traded on an active exchange, such as publicly-traded instruments. •Level 2 - Assets and liabilities valued based on observable market data for similar instruments. Fair value is estimated using inputs other than quoted prices included within Level 1 that are observable for assets or liabilities, either directly or indirectly. •Level 3 - Assets or liabilities for which significant valuation assumptions are not readily observable in the market, and instruments valued based on the best available data, some of which is internally developed and considers risk premiums that a market participant would require. Fair value is estimated using unobservable inputs that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities may include financial instruments whose value is determined using pricing services, pricing models with internally developed assumptions, discounted cash flow ("DCF") methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Assets and liabilities measured at fair value, by their nature, result in a higher degree of financial statement volatility. When available, the Company uses quoted market prices or matrix pricing in active markets to determine fair value and classifies such items as Level 1 or Level 2 assets or liabilities. If quoted market prices in active markets are not available, fair value is determined using third-party broker quotes and/or DCF models incorporating various assumptions including interest rates, prepayment speeds and credit losses. Assets and liabilities valued using broker quotes and/or DCF models are classified as either Level 2 or Level 3, depending on the lowest level classification of an input that is considered significant to the overall valuation. The Company values assets and liabilities based on the principal market in which each would be sold (in the case of assets) or transferred (in the case of liabilities). The principal market is the forum with the greatest volume and level of activity. In the absence of a principal market, the valuation is based on the most advantageous market. In the absence of observable market transactions, the Company considers liquidity valuation adjustments to reflect the uncertainty in pricing the instruments. The fair value of a financial asset is measured on a stand-alone basis and cannot be measured as a group, with the exception of certain financial instruments held and managed on a net portfolio basis. In measuring the fair value of a nonfinancial asset, the Company assumes the highest and best use of the asset by a market participant, not just the intended use, to maximize the value of the asset. The Company also considers whether any credit valuation adjustments are necessary based on the counterparty's credit quality. Any models used to determine fair values or validate dealer quotes based on the descriptions below are subject to review and testing as part of the Company's model validation and internal control testing processes. The Bank's Market Risk Department is responsible for determining and approving the fair values of all assets and liabilities valued at fair value, including the Company's Level 3 assets and liabilities. Price validation procedures are performed and the results are reviewed for Level 3 assets and liabilities by the Market Risk Department. Price validation procedures performed for these assets and liabilities can include comparing current prices to historical pricing trends by collateral type and vintage, comparing prices by product type to indicative pricing grids published by market makers, and obtaining corroborating dealer prices for significant securities. NOTE 14. FAIR VALUE (continued) The Company reviews the assumptions utilized to determine fair value on a quarterly basis. Any changes in methodologies or significant inputs used in determining fair values are further reviewed to determine if a change in fair value level hierarchy has occurred. Transfers in and out of Levels 1, 2 and 3 are considered to be effective as of the end of the quarter in which they occur. There were no transfers between Levels 1, 2 or 3 during the six-month periods ended June 30, 2018 and 2017 for any assets or liabilities valued at fair value on a recurring basis. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables present the assets and liabilities that are measured at fair value on a recurring basis by major product category and fair value hierarchy as of June 30, 2018 and December 31, 2017.
(4) RICs collateralized by vehicle titles at SC and RV/marine loans at SBNA. (5) Residential mortgage loans (6) Investment in debt securities AFS disclosed on the Consolidated Balance Sheets at December 31, 2017 included $10.8 million of equity securities valued using the net asset value as a practical expedient that are not presented within this table. NOTE 14. FAIR VALUE (continued) Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis The Company may be required to measure certain assets and liabilities at fair value on a nonrecurring basis in accordance with GAAP from time to time. These adjustments to fair value usually result from application of lower-of-cost-or-fair value accounting or certain impairment measures. Assets measured at fair value on a nonrecurring basis that were still held on the balance sheet were as follows:
Valuation Processes and Techniques Impaired commercial LHFI in the table above represents the recorded investment of impaired commercial loans for which the Company measures impairment during the period based on the fair value of the underlying collateral supporting the loan. Written offers to purchase a specific impaired loan are considered observable market inputs, which are considered Level 1 inputs. Appraisals are obtained to support the fair value of the collateral and incorporate measures such as recent sales prices for comparable properties and are considered Level 2 inputs. Loans for which the value of the underlying collateral is determined using a combination of real estate appraisals, field examinations and internal calculations are classified as Level 3. The inputs in the internal calculations may include the loan balance, estimation of the collectability of the underlying receivables held by the customer used as collateral, sale and liquidation value of the inventory held by the customer used as collateral and historical loss-given-default parameters. In cases in which the carrying value exceeds the fair value of the collateral less cost to sell, an impairment charge is recognized. The net carrying value of these loans was $402.5 million and $491.5 million at June 30, 2018 and December 31, 2017, respectively. Loans previously impaired which were not marked to fair value during the periods presented are excluded from this table. Foreclosed assets represent the recorded investment in assets taken during the period presented in foreclosure of defaulted loans, and are primarily comprised of commercial and residential real properties and generally measured at fair value less costs to sell. The fair value of the real property is generally determined using appraisals or other indications of market value based on recent comparable sales of similar properties or assumptions generally observable in the marketplace. The Company estimates the fair value of its vehicles, which are obtained either through repossession or lease termination, using historical auction rates and current market values of used cars. The Company's LHFS portfolios that are measured at fair value on a nonrecurring basis primarily consist of personal, commercial, and RICs LHFS. The estimated fair value for these LHFS is calculated based on a combination of estimated market rates for similar loans with similar credit risks and a DCF analysis in which the Company uses significant unobservable inputs on key assumptions, including historical default rates and adjustments to reflect voluntary prepayments, prepayment rates, discount rates reflective of the cost of funding, and credit loss expectations. The lower of cost or fair value adjustment for personal LHFS includes customer default activity and adjustments related to the net change in the portfolio balance during the reporting period. For loans that are considered collateral-dependent, such as certain bankruptcy loans, impairment is measured based on the fair value of the collateral less its estimated cost to sell. For the underlying collateral, the estimated fair value is obtained using historical auction rates and current market levels of used car prices. A portion of the Company's MSRs are measured at fair value on a nonrecurring basis. These MSRs are priced internally using a DCF model. The DCF model incorporates assumptions that market participants would use in estimating future net servicing income, including portfolio characteristics, prepayments assumptions, discount rates, delinquency and foreclosure rates, late charges, other ancillary revenues, cost to service and other economic factors. Due to the unobservable nature of certain valuation inputs, these MSRs are classified as Level 3. NOTE 14. FAIR VALUE (continued) Fair Value Adjustments The following table presents the increases and decreases in value of certain assets that are measured at fair value on a nonrecurring basis for which a fair value adjustment has been included in the Condensed Consolidated Statements of Operations relating to assets held at period-end:
Level 3 Rollforward for Assets and Liabilities Measured at Fair Value on a Recurring Basis The tables below present the changes in Level 3 balances for the three-month and six-month periods ended June 30, 2018 and 2017, respectively, for those assets and liabilities measured at fair value on a recurring basis.
NOTE 14. FAIR VALUE (continued) The gains in earnings reported in the table above related to the RICs HFI for which the Company elected the FVO are driven by three primary factors: 1) the recognition of interest income, 2) recoveries of previously charged-off RICs, and 3) actual performance of the portfolio since the Change in Control. Recoveries from RICs that were charged off at the Change in Control date are a direct increase to the gain recognized within the portfolio. In accordance with ASC 805, Business Combinations, the Company did not ascribe a fair value to the portfolio of sub-prime charged-off RICs at the Change in Control date. Recoveries of previously charged off loans are usually recorded as a reduction to charge-offs in the period in which the recovery is made; however, in instances where the FVO is elected, it will flow through the fair value mark. At the Change in Control date, the UPB of the previously charged-off RIC portfolio was approximately $3.0 billion. Valuation Processes and Techniques - Recurring Fair Value Assets and Liabilities The following is a description of the valuation techniques used for instruments measured at fair value on a recurring basis: Debt Securities Classified as AFS and Trading Securities Debt securities accounted for at fair value include both the AFS and trading securities portfolios. The Company utilizes a third-party pricing service to value its investment securities portfolios on a global basis. Its primary pricing service has consistently proved to be a high quality third-party pricing provider. For those investments not valued by pricing vendors, other trusted market sources are utilized. The Company monitors and validates the reliability of vendor pricing on an ongoing basis, which can include pricing methodology reviews, performing detailed reviews of the assumptions and inputs used by the vendor to price individual securities, and price validation testing. Price validation testing is performed independently of the risk-taking function and can include corroborating the prices received from third-party vendors with prices from another third-party source, reviewing valuations of comparable instruments, comparison to internal valuations, or by reference to recent sales of similar securities. The classification of securities within the fair value hierarchy is based upon the activity level in the market for the security type and the observability of the inputs used to determine their fair values. Trading securities and certain of the Company's U.S. Treasury securities are valued utilizing observable market quotes. The Company obtains vendor trading platform data (actual prices) from a number of live data sources, including active market makers and interdealer brokers. These certain investment securities are, therefore, classified as Level 1. Actively traded quoted market prices for the majority of the debt securities AFS, such as U.S. Treasury and government agency securities, corporate debt, state and municipal securities, and MBS, are not readily available. The Company's principal markets for its investment securities are the secondary institutional markets with an exit price that is predominantly reflective of bid-level pricing in these markets. These investment securities are priced by third-party pricing vendors. The third-party vendors use a variety of methods when pricing these securities that incorporate relevant observable market data to arrive at an estimate of what a buyer in the marketplace would pay for a security under current market conditions. These investment securities are, therefore, considered Level 2. Certain ABS are valued using DCF models. The DCF models are obtained from a third-party pricing vendor who uses observable market data and therefore are classified as Level 2. Other ABS that could not be valued using a third-party pricing service are valued using an internally-developed DCF model. When estimating the fair value using this model, the Company uses its best estimate of the key assumptions, which include the discount rates and forward yield curves. The Company uses comparable bond indices based on industry, term, and rating to discount the expected future cash flows. Determining the comparability of assets involves significant subjectivity related to asset type differences, cash flows, performance and other inputs. The inability of the Company to corroborate the fair value of the ABS due to the limited available observable data on these ABS resulted in a fair value classification of Level 3. Realized gains and losses on investments in debt securities are recognized in the Condensed Consolidated Statements of Operations through Net gains/(losses) on sale of investment securities NOTE 14. FAIR VALUE (continued) RICs HFI For certain RICs HFI, the Company has elected the FVO. The fair values of RICs are estimated using the DCF model. In estimating the fair value using this model, the Company uses significant unobservable inputs on key assumptions, which includes historical default rates and adjustments to reflect voluntary prepayments, prepayment rates based on available data from a comparable market securitization of similar assets, discount rates reflective of the cost of funding debt issuance and recent historical equity yields, recovery rates based on the average severity utilizing reported severity rates and loss severity utilizing available market data from a comparable securitized pool. Accordingly, RICs HFI for which the Company has elected the FVO are classified as Level 3. LHFS The Company's LHFS portfolios that are measured at fair value on a recurring basis consists primarily of residential mortgage LHFS. The fair values of LHFS are estimated using published forward agency prices to agency buyers such as FNMA and FHLMC. The majority of the residential mortgage LHFS portfolio is sold to these two agencies. The fair value is determined using current secondary market prices for portfolios with similar characteristics, adjusted for servicing values and market conditions. These loans are regularly traded in active markets, and observable pricing information is available from market participants. The prices are adjusted as necessary to include the embedded servicing value in the loans as well as the specific characteristics of certain loans that are priced based on the pricing of similar loans. These adjustments represent unobservable inputs to the valuation, and are not significant given the relative insensitivity of the value to changes in these inputs to the fair value of the loans. Accordingly, residential mortgage LHFS are classified as Level 2. Gains and losses on residential mortgage LHFS are recognized in the Condensed Consolidated Statements of Operations through Miscellaneous income. See further discussion below in the section captioned "FVO for Financial Assets and Financial Liabilities." MSRs The model to value MSRs estimates the present value of the future net cash flows from mortgage servicing activities based on various assumptions. These cash flows include servicing and ancillary revenue, offset by the estimated costs of performing servicing activities. Significant assumptions used in the valuation of residential MSRs include changes in anticipated loan prepayment rates ("CPRs") and the discount rate, reflective of a market participant's required return on an investment for similar assets. Other important valuation assumptions include market-based servicing costs and the anticipated earnings on escrow and similar balances held by the Company in the normal course of mortgage servicing activities. All of these assumptions are considered to be unobservable inputs. Historically, servicing costs and discount rates have been less volatile than CPR and earnings rates, both of which are directly correlated with changes in market interest rates. Increases in prepayment speeds, discount rates and servicing costs result in lower valuations of MSRs. Decreases in the anticipated earnings rate on escrow and similar balances result in lower valuations of MSRs. For each of these items, the Company makes assumptions based on current market information and future expectations. All of the assumptions are based on standards that the Company believes would be utilized by market participants in valuing MSRs and are derived and/or benchmarked against independent public sources. Accordingly, MSRs are classified as Level 3. Gains and losses on MSRs are recognized on the Condensed Consolidated Statements of Operations through Miscellaneous income, net. See further discussion on MSRs in Note 8. Listed below are the most significant inputs that are utilized by the Company in the evaluation of residential MSRs:
NOTE 14. FAIR VALUE (continued) Significant increases/(decreases) in any of those inputs in isolation would result in significantly (lower)/higher fair value measurements, respectively. These sensitivity calculations are hypothetical and should not be considered to be predictive of future performance. Changes in fair value based on adverse changes in assumptions generally cannot be extrapolated because the relationship of the change in assumption to the change in fair value may not be linear. Also, the effect of an adverse variation in a particular assumption on the fair value of the MSRs is calculated without changing any other assumption, while in reality changes in one factor may result in changes in another, which may either magnify or counteract the effect of the change. Prepayment estimates generally increase when market interest rates decline and decrease when market interest rates rise. Discount rates typically increase when market interest rates increase and/or credit and liquidity risks increase, and decrease when market interest rates decline and/or credit and liquidity conditions improve. Derivatives The valuation of these instruments is determined using commonly accepted valuation techniques, including DCF analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable and unobservable market-based inputs. The fair value represents the estimated amount the Company would receive or pay to terminate the contract or agreement, taking into account current interest rates, foreign exchange rates, equity prices and, when appropriate, the current creditworthiness of the counterparties. The Company incorporates credit valuation adjustments in the fair value measurement of its derivatives to reflect the counterparty's nonperformance risk in the fair value measurement of its derivatives, except for those derivative contracts with associated credit support annexes which provide credit enhancements, such as collateral postings and guarantees. The Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy. Certain of the Company's derivatives utilize Level 3 inputs, which are primarily related to mortgage banking derivatives-interest rate lock commitments and total return settlement derivative contracts. The DCF model is utilized to determine the fair value of the mortgage banking derivatives-interest rate lock commitments and the total return settlement derivative contracts. The significant unobservable inputs for mortgage banking derivatives used in the fair value measurement of the Company's loan commitments are "pull through" percentage and the MSR value that is inherent in the underlying loan value. The pull through percentage is an estimate of loan commitments that will result in closed loans. The significant unobservable inputs for total return settlement derivative contracts used in the fair value measurement of the Company's liabilities are discount percentages, which are based on comparable financial instruments. Significant increases (decreases) in any of these inputs in isolation would result in significantly higher (lower) fair value measurements. Significant increases (decreases) in the fair value of a mortgage banking derivative asset (liability) results when the probability of funding increases (decreases). Significant increases (decreases) in the fair value of a mortgage loan commitment result when the embedded servicing value increases (decreases). Gains and losses related to derivatives affect various line items in the Condensed Consolidated Statements of Operations. See Note 12 for a discussion of derivatives activity. NOTE 14. FAIR VALUE (continued) Level 3 Inputs - Significant Recurring and Nonrecurring Fair Value Assets and Liabilities The following table presents quantitative information about the significant unobservable inputs within significant Level 3 recurring and nonrecurring assets and liabilities at June 30, 2018 and December 31, 2017:
NOTE 14. FAIR VALUE (continued)
(11) Excludes MSR valued on a non-recurring basis for which we do not consider there to be significant unobservable assumptions. NOTE 14. FAIR VALUE (continued) Fair Value of Financial Instruments The carrying amounts and estimated fair values, as well as the level within the fair value hierarchy, of the Company's financial instruments are as follows:
(2) Investment in debt securities AFS disclosed on the Consolidated Balance Sheets at December 31, 2017 included $10.8 million of equity securities valued using net asset value as a practical expedient that are not presented within this table. The balance of these equity securities at June 30, 2018 is $10.9 million and is included in the Other investments line item on the Condensed Consolidated Balance Sheets. Valuation Processes and Techniques - Financial Instruments The preceding tables present disclosures about the fair value of the Company's financial instruments. Those fair values for certain instruments are presented based upon subjective estimates of relevant market conditions at a specific point in time and information about each financial instrument. In cases in which quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. These techniques involve uncertainties resulting in variability in estimates affected by changes in assumptions and risks of the financial instruments at a certain point in time. Therefore, the derived fair value estimates presented above for certain instruments cannot be substantiated by comparison to independent markets. In addition, the fair values do not reflect any premium or discount that could result from offering for sale at one time an entity’s entire holding of a particular financial instrument, nor does it reflect potential taxes and the expenses that would be incurred in an actual sale or settlement. Accordingly, the aggregate fair value amounts presented above do not represent the underlying value of the Company. FVO for Financial Assets and Financial Liabilities LHFS The Company's LHFS portfolios that are measured using the FVO consist of residential mortgage LHFS. The adoption of the FVO for residential mortgage loans classified as HFS allows the Company to record the mortgage LHFS portfolio at fair market value compared to the lower of cost, net of deferred fees, deferred origination costs, or market. The Company economically hedges its residential LHFS portfolio, which is reported at fair value. A lower of cost or market accounting treatment would not allow the Company to record the excess of the fair market value over book value, but would require the Company to record the corresponding reduction in value on the hedges. Both the loans and related hedges are carried at fair value, which reduces earnings volatility, as the amounts more closely offset. NOTE 14. FAIR VALUE (continued) RICs HFI To reduce accounting and operational complexity, the Company elected the FVO for certain of its RICs HFI. These loans consisted primarily of SC’s RICs accounted for by SC under ASC 310-30, as well as all of SC’s RICs that were more than 60 days past due at the date of the Change in Control, which collectively had an aggregate outstanding UPB of $2.6 billion with a fair value of $1.9 billion at that date. The balance also includes non-performing loans acquired by SC under optional clean up calls from its non-consolidated Trusts. The following table summarizes the differences between the fair value and the principal balance of LHFS and RICs measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017:
Interest income on the Company’s LHFS and RICs HFI is recognized when earned based on their respective contractual rates in Interest income on loans in the Condensed Consolidated Statements of Operations. The accrual of interest is discontinued and reversed once the loans become more than 90 days past due for LHFS and more than 60 days past due for RICs HFI. Residential MSRs The Company elected to account for the majority of its existing portfolio of MSRs at fair value. This election created greater flexibility with regard to risk management of the asset by aligning the accounting for the MSRs with the accounting for risk management instruments, which are also generally carried at fair value. The remainder of the MSRs are accounted for using the lower of cost or fair value and are presented above in the section captioned "Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis." The Company's residential MSRs that are accounted for at fair value had an aggregate fair value of $158.5 million at June 30, 2018. Changes in fair value totaling a loss of $1.3 million and a gain of $13.8 million were recorded in Miscellaneous income, net in the Condensed Consolidated Statements of Operations during the three-month and six-month periods ended June 30, 2018, respectively. |
NON-INTEREST INCOME |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NON-INTEREST INCOME | NON-INTEREST INCOME The following table presents the details of the Company's Non-interest income for the following periods:
(1) - Prior period amounts have not been adjusted under the modified retrospective method. For further information, see Note 1. Disaggregation of Revenue from Contracts with Customers Beginning January 1, 2018 the Company adopted the new accounting standard, "Revenue from Contracts with Customers", which requires the Company to disclose a disaggregation of revenue from contracts with customers that falls within the scope of this new accounting standard. The scope of the guidance explicitly excludes net interest income as well as many other revenues for financial assets and liabilities including loans, leases, securities, and derivatives. Therefore, the Company has evaluated the revenue streams within our Non-interest income line items to determine whether they are in-scope or out-of-scope. The following table presents the Company's Non-interest income disaggregated by revenue source.
(1) - Prior period amounts have not been adjusted under the modified retrospective method. For further information, see Note 1. (2) - Primarily recorded in the Company's Condensed Consolidated Statements of Operations within Consumer and commercial fees. (3) - Primarily recorded in the Company's Condensed Consolidated Statements of Operations within Miscellaneous income, net. (4) - The balance presented excludes certain revenue streams that are considered in-scope and presented above. NOTE 15. NON-INTEREST INCOME (continued) Arrangements with Multiple Performance Obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the prices charged to customers or using expected cost plus margin. Practical Expedients In instances where incremental costs, such as commission expenses, are incurred and the period of benefit is equal to or less than one year, the Company has elected to apply the practical expedient where the Company expenses such amounts as incurred. These costs are recorded within Compensation and benefits, within the Condensed Consolidated Statements of Operations. In instances where contracts with customers contain a financing component and the Company expects the customer to pay for the goods or services within one year or less, the Company has elected to apply the practical expedient where the Company does not adjust the contracted amount of consideration for the effects of financing components. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less or (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. As a result of the practical expedient and for the Company's material revenue streams, there are no unperformed performance obligations. As a result of the practical expedient and the Company's revenue recognition for contracts with customers, there are no material contract assets or liabilities. |
COMMITMENTS, CONTINGENCIES AND GUARANTEES |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS, CONTINGENCIES AND GUARANTEES | COMMITMENTS, CONTINGENCIES AND GUARANTEES Off-Balance Sheet Risk - Financial Instruments In the normal course of business, the Company utilizes a variety of financial instruments with off-balance sheet risk to meet the financing needs of its customers and manage its exposure to fluctuations in interest rates. These financial instruments include commitments to extend credit, letters of credit, loans sold with recourse, forward contracts, and interest rate and cross currency swaps, caps and floors. These financial instruments may involve, to varying degrees, elements of credit, liquidity, and interest rate risk in excess of the amount recognized on the Condensed Consolidated Balance Sheets. The contractual or notional amounts of these financial instruments reflect the extent of involvement the Company has in particular classes of financial instruments. The Company’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for commitments to extend credit, letters of credit and loans sold with recourse is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. For forward contracts and interest rate swaps, caps and floors, the contract or notional amounts do not represent exposure to credit loss. The Company controls the credit risk of its forward contracts and interest rate swaps, caps and floors through credit approvals, limits and monitoring procedures. See Note 12 to these Condensed Consolidated Financial Statements for discussion of all derivative contract commitments. The following table details the amount of commitments at the dates indicated:
Commitments to Extend Credit Commitments to extend credit generally have fixed expiration dates, are variable rate, and contain provisions that permit the Company to terminate or otherwise renegotiate the contracts in the event of a significant deterioration in the customer’s credit quality. These arrangements normally require payment of a fee by the customer, the pricing of which is based on prevailing market conditions, credit quality, probability of funding, and other relevant factors. Since many of these commitments are expected to expire without being drawn upon, the contract amounts are not necessarily indicative of future cash requirements. Included within the reported balances for Commitments to extend credit at June 30, 2018 and December 31, 2017 are $6.7 billion and $6.4 billion, respectively, of commitments that can be canceled by the Company without notice. The following table details the amount of commitments to extend credit expiring per period as of the dates indicated:
Unsecured Revolving Lines of Credit Such commitments, included in the Commitments to extend credit table above, arise primarily from agreements with customers for unused lines of credit on unsecured revolving accounts and credit cards, provided there is no violation of conditions in the underlying agreement. These commitments, substantially all of which the Company can terminate at any time and which do not necessarily represent future cash requirements, are periodically reviewed based on account usage, customer creditworthiness and loan qualifications. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) Letters of Credit The Company’s letters of credit meet the definition of a guarantee. Letters of credit commit the Company to make payments on behalf of its customers if specified future events occur. The guarantees are primarily issued to support public and private borrowing arrangements. The weighted average term of these commitments at June 30, 2018 was 15.5 months. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. In the event of a requested draw by the beneficiary that complies with the terms of the letter of credit, the Company would be required to honor the commitment. The Company has various forms of collateral for these letters of credit, including real estate assets and other customer business assets. The maximum undiscounted exposure related to these commitments at June 30, 2018 was $1.5 billion. The fees related to letters of credit are deferred and amortized over the life of the respective commitments, and were immaterial to the Company’s financial statements at June 30, 2018. Management believes that the utilization rate of these letters of credit will continue to be substantially less than the amount of the commitments, as has been the Company’s experience to date. As of June 30, 2018 and December 31, 2017, the liability related to these letters of credit was $2.4 million and $18.2 million, respectively, which is recorded within the reserve for unfunded lending commitments in Other liabilities on the Condensed Consolidated Balance Sheets. The credit risk associated with letters of credit is monitored using the same risk rating system utilized within the loan and financing lease portfolio. Also included within the reserve for unfunded lending commitments at June 30, 2018 and December 31, 2017 were lines of credit outstanding of $84.6 million and $90.9 million, respectively. The following table details the amount of letters of credit expiring per period as of the dates indicated:
Loans Sold with Recourse The Company has loans sold with recourse that meet the definition of a guarantee. For loans sold with recourse under the terms of its multifamily sales program with FNMA, the Company retained a portion of the associated credit risk. The UPB outstanding of loans sold in these programs was $52.4 million as of June 30, 2018 and $136.0 million as of December 31, 2017. As a result of its agreement with FNMA, the Company retained a 100% first loss position on each multifamily loan sold to FNMA until the earlier to occur of (i) the aggregate approved losses on multifamily loans sold to FNMA reaching the maximum loss exposure for the portfolio as a whole of $12.2 million as of June 30, 2018 and $12.2 million as of December 31, 2017 or (ii) the time when such loans sold to FNMA under this program are fully paid off. Any losses sustained as a result of impediments in standard representations and warranties would be in addition to the maximum loss exposure. At the time of the sale, the Company established a liability which represented the fair value of the retained credit exposure and the amount the Company estimates it would have to pay a third party to assume the retained recourse obligation. The estimated liability is calculated as the present value of losses that the portfolio is projected to incur based upon specific internal information and an industry-based default curve with a range of estimated losses. At June 30, 2018 and December 31, 2017, the Company had zero and $1.3 million, respectively, of reserves classified in Accrued expenses and payables on the Condensed Consolidated Balance Sheets related to the retained credit exposure for loans sold to the FNMA under this program. The Company's commitment will expire in March 2039 based on the maturity of the loans sold with recourse. Losses sustained by the Company may be offset, or partially offset, by proceeds resulting from the disposition of the underlying mortgaged properties. Approval from the FNMA is required for all transactions related to the liquidation of properties underlying the mortgages. Commitments to Sell Loans The Company enters into forward contracts relating to its mortgage banking business to hedge the exposures from commitments to make new residential mortgage loans with existing customers and from mortgage loans classified as LHFS. These contracts mature in less than one year. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) SC Commitments SC is party to agreements with Bluestem whereby SC is committed to purchase certain new advances on personal revolving financings originated by a third-party retailer, along with existing balances on accounts with new advances, for an initial term ending in April 2020 and renewing through April 2022 at Bluestem's option. As of June 30, 2018 and December 31, 2017, the total unused credit available to customers was $3.8 billion and $3.9 billion, respectively. In 2017, the Company purchased $1.2 billion of receivables out of the $4.0 billion of unused credit available to customers at December 31, 2016. During the six months ended June 30, 2018, the Company purchased $0.5 billion of receivables out of the $3.9 billion unused credit available to customers as of December 31, 2017. In addition, SC purchased $83.8 million of receivables related to newly-opened customer accounts during the six months ended June 30, 2018. Each customer account generated under the agreements generally is approved with a credit limit higher than the amount of the initial purchase, with each subsequent purchase automatically approved as long as it does not cause the account to exceed its limit and the customer is in good standing. As of June 30, 2018 and December 31, 2017, SC was obligated to purchase $15.7 million and $11.5 million, respectively, in receivables that had been originated by the retailer but not yet purchased by SC. SC also is required to make a profit-sharing payment to the retailer each month if performance exceeds a specified return threshold. During the year ended December 31, 2015, SC and the third-party retailer executed an amendment that, among other provisions, increases the profit-sharing percentage retained by SC, gives the retailer the right to repurchase up to 9.99% of the existing portfolio at any time during the term of the agreement, and, provided that the repurchase right is exercised, gives the retailer the right to retain up to 20% of new accounts subsequently originated. Under terms of an application transfer agreement with an original equipment manufacturer (“OEM") other than FCA, SC has the first opportunity to review for its own portfolio any credit applications turned down by the OEM's captive finance company. The agreement does not require SC to originate any loans, but for each loan originated SC will pay the OEM a referral fee. In connection with the sale of RICs through securitizations and other sales, SC has made standard representations and warranties customary to the consumer finance industry. Violations of these representations and warranties may require SC to repurchase loans previously sold to on- or off-balance sheet Trusts or other third parties. As of June 30, 2018, there were no loans that were the subject of a demand to repurchase or replace for breach of representations or warranties for SC's ABS or other sales. In the opinion of management, the potential exposure of other recourse obligations related to SC’s RIC sales agreements will not have a material adverse effect on SC’s consolidated financial position, results of operations, or cash flows. Santander has provided guarantees on the covenants, agreements, and obligations of SC under the governing documents of its warehouse facilities and privately issued amortizing notes. These guarantees are limited to the obligations of SC as servicer. Chrysler Agreement Under terms of the Chrysler Agreement, SC must make revenue-sharing payments to FCA and also must make gain-sharing payments to FCA when residual gains on leased vehicles exceed a specified threshold. SC had accrued $11.1 million and $6.6 million at June 30, 2018 and December 31, 2017, respectively, related to these obligations. The Chrysler Agreement requires, among other things, that SC bears the risk of loss on loans originated pursuant to the agreement, but also that FCA shares in any residual gains and losses from consumer leases. The agreement also requires that SC maintains at least $5.0 billion in funding available for dealer inventory financing and $4.5 billion of financing dedicated to FCA retail financing. In turn, FCA must provide designated minimum threshold percentages of its subvention business to SC. The Chrysler Agreement is subject to early termination in certain circumstances, including the failure by either party to comply with certain of its ongoing obligations under the agreement. These obligations include SC's meeting specified escalating penetration rates for the first five years of the agreement. SC did not meet these penetration rates. Also, FCA has the option to acquire, for fair market value, an equity participation in the business offering and providing the financial services contemplated by the Chrysler Agreement. If FCA exercises its purchase option, the Chrysler Agreement were to terminate, or the Company otherwise is unable to realize the expected benefits of its relationship with FCA, there could be a materially adverse impact to the Company's and SC's business, financial condition, results of operations, profitability, loan and lease volume, the credit quality of its portfolio, liquidity, funding and growth, and the Company's or SC's ability to implement its business strategy could be materially adversely affected. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) Agreement with Bank of America Until January 31, 2017, SC had a flow agreement with Bank of America whereby SC was committed to sell up to $300.0 million of eligible loans to the bank each month. On October 27, 2016, Bank of America notified SC that it was terminating the flow agreement effective January 31, 2017 and, accordingly, the flow agreement has terminated. SC retains servicing on all sold loans and may receive or pay a servicer performance payment based on an agreed-upon formula if performance on the sold loans is better or worse, respectively, than expected performance at the time of sale. Servicer payments are due six years from the cut-off date of each loan sale. SC had accrued $7.0 million and $8.1 million at June 30, 2018 and December 31, 2017, respectively, related to this obligation. Agreement with Citizens Bank of Pennsylvania ("CBP") Until May 1, 2017, SC sold loans to CBP under terms of a flow agreement and predecessor sale agreements. Under the flow agreement, as amended, CBP's committed purchases of Chrysler Capital prime loans were a maximum of $200.0 million and a minimum of $50.0 million per quarter. SC retains servicing on the sold loans and will owe CBP a loss-sharing payment capped at 0.5% of the original pool balance if losses exceed a specified threshold, established on a pool-by-pool basis. Loss-sharing payments are due the month in which net losses exceed the established threshold of each loan sale. The Company had accrued $5.0 million and $5.6 million at June 30, 2018 and December 31, 2017, respectively, related to this obligation. Other Agreements As of June 30, 2018, SC was party to a forward flow asset sale agreement with a third party under the terms of which SC is committed to sell charged-off loan receivables in bankruptcy status on a quarterly basis until sales total at least $350.0 million. However, any sale of more than $275.0 million is subject to a market price check. As of June 30, 2018 and December 31, 2017, the remaining aggregate commitments were $78.5 million and $98.9 million, respectively. Other Contingencies SC is or may be subject to potential liability under various other contingent exposures. SC had accrued $14.3 million and $6.3 million at June 30, 2018 and December 31, 2017, respectively, for other miscellaneous contingencies. Impact from Hurricanes Our footprint was impacted by three significant hurricanes during the third quarter of 2017, Hurricane Harvey, which struck the State of Texas and the surrounding region, Hurricane Irma, which primarily struck the State of Florida, and Hurricane Maria, which struck the island of Puerto Rico. Each of these hurricanes resulted in widespread flooding, power outages and associated damage to real and personal property in the affected areas SC, headquartered in Dallas, Texas, BSI, headquartered in Miami, Florida, and Santander BanCorp, BSPR and SSLLC in Puerto Rico were most directly affected by these hurricanes. In Puerto Rico, there was significant damage to the infrastructure and the power grid on the entire island, which resulted in extended delays in BSPR returning to normal operations. The Company assessed the potential additional credit losses related to its consumer and commercial lending exposures in the greater Texas, Florida and Puerto Rico regions. As a result, the Company's ALLL had approximately $95 million of reserves at June 30, 2018 related to the hurricanes. However, for credit exposures in Puerto Rico, given the current state of the region, the Company has had limited information with which to estimate probable credit losses. As of June 30, 2018, the Company has approximately $3.4 billion of loan exposures in Puerto Rico, consisting of $1.6 billion in consumer loans and $1.8 billion in commercial loans including $220 million in loans to municipalities. The Company will continue to monitor and assess the impact of these hurricanes on our subsidiaries’ businesses, and may make adjustments to reserves for losses in future periods as additional information related to these potential exposures becomes available. See discussion under the "Puerto Rico FINRA Arbitrations" section of Note 16 below for further discussion. Other Off-Balance Sheet Risk Other off-balance sheet risk stems from financial instruments that do not meet the definition of guarantees under applicable accounting guidance, and from other relationships that include items such as indemnifications provided in the ordinary course of business and intercompany guarantees. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) Legal and Regulatory Proceedings Periodically, the Company is party to, or otherwise involved in, various lawsuits, investigations, regulatory matters and other legal proceedings that arise in the ordinary course of business. In view of the inherent difficulty of predicting the outcome of any such lawsuit, investigation, regulatory matter and/or legal proceeding, particularly where the claimants seek very large or indeterminate damages or where the matters present novel legal theories or involve a large number of parties, the Company generally cannot predict the eventual outcome of the pending matters, the timing of the ultimate resolution of the matters, or the eventual loss, fines or penalties related to the matter. Accordingly, except as provided below, the Company is unable to reasonably estimate a range of its potential exposure, if any, to these lawsuits, investigations, regulatory matters and other legal proceedings at this time. However, it is reasonably possible that actual outcomes or losses may differ materially from the Company's current assessments and estimates and any adverse resolution of any of these matters against it could have a material adverse effect on the Company's financial position, liquidity, and results of operations. In accordance with applicable accounting guidance, the Company establishes an accrued liability for litigation, investigation, regulatory matters and other legal proceedings when those matters present material loss contingencies that are both probable and estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. As a litigation, investigation or regulatory matter develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether the matter presents a material loss contingency that is probable and estimable. If a determination is made during a given quarter that a material loss contingency is probable and estimable, an accrued liability is established during such quarter with respect to such loss contingency; the Company continues to monitor the matter for further developments that could affect the amount of the accrued liability previously established. As of June 30, 2018 and December 31, 2017, the Company accrued aggregate legal and regulatory liabilities of $176.9 million and $161.8 million, respectively. Further, the Company estimates the aggregate range of reasonably possible losses for legal and regulatory proceedings in excess of reserves of up to $273 million and $255 million as of June 30, 2018 and December 31, 2017, respectively. Descriptions of the material lawsuits, regulatory matters and other legal proceedings to which the Company is subject are set forth below. OCC Identity Theft Protection Product ("SIP") Matter On March 26, 2015, the Bank entered into a Cease and Desist Order (the "SIP Consent Order") with the OCC regarding identified deficiencies in SBNA's billing practices with regard to SIP, an identity theft protection product from the Bank's third party vendor. Pursuant to the SIP Consent Order, the Bank paid a civil monetary penalty ("CMP") of $6 million and agreed to remediate customers who paid for but may not have received certain benefits of SIP. Prior to entering into the SIP Consent Order, the Bank made $37.3 million in remediation payments to customers, representing the total amount paid for product enrollment. Subsequently, the Bank commenced a further review in order to remediate checking account customers who may have been charged an overdraft fee and credit card customers who may have been charged an over limit fee and/or finance charge related to SIP product fees. The Bank is currently implementing the actions and remediation set forth in the Bank’s action plans to reimburse customers. CFPB Overdraft Coverage Consent Order On April 1, 2014, the Bank received a civil investigative demand ("CID") from the CFPB requesting information and documents in connection with the Bank’s marketing to consumers of overdraft coverage for ATM and onetime debit card transactions through a third-party vendor. On July 14, 2016, the Bank entered into a consent order with the CFPB regarding these practices. Pursuant to the terms of the consent order, the Bank paid a CMP of $10.0 million and agreed to validate the elections made by customers who opted in to overdraft coverage for ATM and onetime debit card transactions in connection with telemarketing by the third-party vendor. The Bank was also required to make certain changes to its third-party vendor oversight policy and its customer complaint policy. The Bank implemented a remediation plan and believes it has met the consent order requirements. It is possible that additional litigation could be filed as a result of these issues. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) Other Matters On July 2, 2015, the Company entered into a written agreement with the FRB of Boston. Under the terms of that written agreement, the Company is required to make enhancements with respect to, among other matters, Board oversight of the consolidated organization, risk management, capital planning and liquidity risk management. On March 21, 2017, SC and SHUSA entered into a written agreement with the FRB of Boston. Under the terms of that agreement, SC is required to enhance its compliance risk management program, board oversight of risk management and senior management oversight of risk management, and SHUSA is required to enhance its oversight of SC's management and operations. SC Matters Periodically, SC is party to, or otherwise involved in, various lawsuits and other legal proceedings that arise in the ordinary course of business. Securities Class Action and Shareholder Derivative Lawsuits Deka Lawsuit: SC is a defendant in a purported securities class action lawsuit (the "Deka Lawsuit") in the United States District Court, Northern District of Texas, captioned Deka Investment GmbH et al. v. Santander Consumer USA Holdings Inc. et al., No. 3:15-cv-2129-K. The Deka Lawsuit is against SC, certain of its current and former directors and executive officers and certain institutions that served as underwriters in SC's initial public offering (the "IPO") , including SIS, on behalf of a class consisting of those who purchased or otherwise acquired SC securities between January 23, 2014 and June 12, 2014. The amended class action complaint alleges, among other things, that the IPO registration statement and prospectus and certain subsequent public disclosures violated federal securities laws by containing misleading statements concerning SC’s ability to pay dividends and the adequacy of SC’s compliance systems and oversight. On December 18, 2015, SC and the individual defendants moved to dismiss the lawsuit, which was denied. On December 2, 2016, the plaintiffs moved to certify the proposed classes. On July 11, 2017, the court entered an order staying the Deka Lawsuit pending the resolution of the appeal of a class certification order in In re Cobalt Int’l Energy, Inc. Sec. Litig., No. H-14-3428, 2017 U.S. Dist. LEXIS 91938 (S.D. Tex. June 15, 2017). Feldman Lawsuit: On October 15, 2015, a shareholder derivative complaint was filed in the Court of Chancery of the State of Delaware, captioned Feldman v. Jason A. Kulas, et al., C.A. No. 11614 (the "Feldman Lawsuit"). The Feldman Lawsuit names as defendants certain current and former members of SC’s Board of Directors, and names SC as a nominal defendant. The complaint alleges, among other things, that the current and former director defendants breached their fiduciary duties in connection with overseeing SC’s nonprime auto lending practices, resulting in harm to SC. The complaint seeks unspecified damages and equitable relief. On December 29, 2015, the Feldman Lawsuit was stayed pending the resolution of the Deka Lawsuit. Jackie888 Lawsuit: On September 27, 2016, a shareholder derivative complaint was filed in the Court of Chancery of the State of Delaware captioned Jackie888, Inc. v. Jason Kulas, et al., C.A. # 12775 (the "Jackie888 Lawsuit"). The Jackie888 Lawsuit names as defendants current and former members of SC’s Board of Directors, and names SC as a nominal defendant. The complaint alleges, among other things, that the defendants breached their fiduciary duties in connection with SC’s accounting practices and controls. The complaint seeks unspecified damages and equitable relief. On April 13, 2017, the Jackie888 Lawsuit was stayed pending the resolution of the Deka Lawsuit. Parmelee Lawsuits: Two purported securities class action lawsuits filed in March and April 2016 in the United States District Court, Northern District of Texas, were consolidated and are now captioned Parmelee v. Santander Consumer USA Holdings Inc. et al., No. 3:16-cv-783 (the "Parmelee Lawsuits"). The Parmelee Lawsuits were filed against SC and certain of its current and former directors and executive officers on behalf of a class consisting of all those who purchased or otherwise acquired SC securities between February 3, 2015 and March 15, 2016. The complaint alleges, among other things, that SC violated federal securities laws by making false or misleading statements, as well as failing to disclose material adverse facts, in its periodic reports filed under the Exchange Act and certain other public disclosures, in connection with, among other things, SC’s change in its methodology for estimating its ACL and the correction of such ACL for prior periods. On January 3, 2018, the court granted SC’s motion to dismiss the lawsuit as to defendant Ismail Dawood (SC’s former Chief Financial Officer) and denied the motion as to all other defendants. In July 2018, plaintiffs filed a motion seeking preliminary court approval of a class-wide settlement calling for total payment of $9.5 million to the class and its lawyers. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) Consumer Lending Cases SC is also party to various lawsuits pending in federal and state courts alleging violations of state and federal consumer lending laws, including, without limitation, the Equal Credit Opportunity Act (the “ECOA”), the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, Section 5 of the Federal Trade Commission Act, the Telephone Consumer Protection Act, the Truth in Lending Act, wrongful repossession laws, usury laws and laws related to unfair and deceptive acts or practices. In general, these cases seek damages and equitable and/or other relief. Regulatory Proceedings SC is party to, or is periodically otherwise involved in, reviews, investigations, examinations and proceedings (both formal and informal), and information-gathering requests, by government and self-regulatory agencies, including the FRB of Boston, the CFPB, the Department of Justice (the “DOJ”), the SEC, the Federal Trade Commission and various state regulatory and enforcement agencies. Currently, such matters include, but are not limited to, the following:
Mississippi Attorney General Lawsuit On January 10, 2017, the Attorney General of the State of Mississippi (the "Mississippi AG") filed a lawsuit against SC in the Chancery Court of the First Judicial District of Hinds County, State of Mississippi, captioned State of Mississippi ex rel. Jim Hood, Attorney General of the State of Mississippi v. Santander Consumer USA Inc., C.A. # G-2017-28. The complaint alleges that SC engaged in unfair and deceptive business practices to induce Mississippi consumers to apply for loans that they could not afford. The complaint asserts claims under the Mississippi Consumer Protection Act (the "MCPA") and seeks unspecified civil penalties, equitable relief and other relief. On March 31, 2017, SC filed motions to dismiss the Mississippi AG’s lawsuit, and subsequently filed a motion to stay the lawsuit pending the resolution of an interlocutory appeal relating to the MCPA before the Mississippi Supreme Court in Purdue Pharma, L.P., et al. v. State, No. 2017-IA- 00300-SCT. On September 25, 2017, the court granted the motion to stay and ordered a stay of all proceedings, excluding discovery and final briefing on motions to dismiss. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) Servicemembers’ Civil Relief Act (“SCRA') Consent Order In February 2015, SC entered into a consent order with the DOJ, approved by the United States District Court for the Northern District of Texas, which resolves the DOJ's claims against SC that certain of its repossession and collection activities during the period between January 2008 and February 2013 violated the SCRA. The consent order requires SC to pay a civil fine in the amount of $55,000, as well as at least $9.4 million to affected servicemembers consisting of $10,000 per servicemember plus compensation for any lost equity (with interest) for each repossession by SC, and $5,000 per servicemember for each instance where SC sought to collect repossession-related fees on accounts where a repossession was conducted by a prior account holder. The consent order also provides for monitoring by the DOJ of the SC’s SCRA compliance for a period of five years and requires SC to undertake certain additional remedial measures. Intermediate Holding Company (“IHC') Matters Periodically, SSLLC is party to pending and threatened legal actions and proceedings, including Financial Industry Regulatory Authority (“FINRA”) arbitration actions and class action claims. Puerto Rico FINRA Arbitrations As of June 30, 2018, SSLLC had received 458 FINRA arbitration cases related to Puerto Rico bonds and Puerto Rico closed-end funds ("CEFs"). Most of these cases are based upon concerns regarding the local Puerto Rico securities market. The statements of claims allege, among other things, fraud, negligence, breach of fiduciary duty, breach of contract, unsuitability, over-concentration and failure to supervise. There were 327 arbitration cases that remained pending as of June 30, 2018. As a result of Hurricane Maria impacting the Puerto Rico market including declines in Puerto Rico bond and CEF prices, it is possible that additional arbitration claims and/or increased claim amounts may be asserted in future periods. Puerto Rico CEF Shareholder Derivative and Class Actions Santander, Santander BanCorp, BSPR, SSLLC, Santander Asset Management, LLC and several directors and members of senior management of these entities are defendants in a purported class action and shareholder derivative suit pending in the United States District Court for the District of the Commonwealth of Puerto Rico captioned Dionisio Trigo Gonzalez et al. v. Banco Santander, S.A. et al., No. 3:2016cv02868. Brought by customers of certain CEFs, the complaint alleges misconduct including that the entities and individuals created, controlled, managed and advised certain CEFs within the First Puerto Rico Family of Funds (the “Funds”) from March 1, 2012 through the present to the detriment of the Funds and their shareholders. Brought on behalf of the Funds and Puerto Rico-based investors, the complaint seeks unspecified damages but alleges damages to be at least tens of millions of dollars. The court denied plaintiffs’ motion to reconsider its earlier decision not to remand the case to Puerto Rico state court. SSLLC, Santander BanCorp, BSPR, the Company and Santander are defendants in a putative class action alleging federal securities and common law claims relating to the solicitation and purchase of more than $180 million of Puerto Rico bonds and $101 million of CEFs during the period from December 2012 to October 2013. The case is pending in the United States District Court for the District of Puerto Rico and is captioned Jorge Ponsa-Rabell, et. al. v. SSLLC, Civ. No. 3:17-cv-02243. The amended complaint alleges that defendants acted in concert to defraud purchasers in connection with the underwriting and sale of Puerto Rico municipal bonds, CEFs and open-end funds. Mexican Government Bonds Consolidated Purported Antitrust Class Action: A consolidated purported antitrust class action is pending in the United States District Court, Southern District of New York, captioned In re Mexican Government Bonds Antitrust Litigation, No. 1:18-cv-02830-JPO (the “MGB Lawsuit”). The MGB Lawsuit is against the Company, SIS, Santander, Banco Santander (Mexico), S.A. Institucion de Banca Multiple, Grupo Financiero Santander and Santander Investment Bolsa, Sociedad de Valores, S.A. on behalf of a class of persons who entered into Mexican government bond (“MGB”) transactions between January 1, 2006 and April 19, 2017, where such persons were either domiciled in the United States or, if domiciled outside the United States, transacted in the United States. The complaint alleges, among other things, that the Santander defendants and the other defendants violated U.S. antitrust laws by conspiring to rig auctions and/or fix prices of MGBs. NOTE 16. COMMITMENTS, CONTINGENCIES AND GUARANTEES (continued) These matters are ongoing and could in the future result in the imposition of damages, fines or other penalties. No assurance can be given that the ultimate outcome of these matters or any resulting proceedings would not materially and adversely affect the Company's business, financial condition and results of operations. |
RELATED PARTY TRANSACTIONS |
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RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The Company has various debt agreements with Santander. For a listing of these debt agreements, see Note 11 to the Consolidated Financial Statements of the Company's Annual Report on Form 10-K for the year ended December 31, 2017. The Company and its affiliates also entered into or were subject to various service agreements with Santander and its affiliates. Each of these agreements was made in the ordinary course of business and on market terms. Contributions from Santander that impact common stock and paid in capital within the Condensed Consolidated Statements of Stockholder's Equity are disclosed within the table below:
On January 1, 2018, the Company purchased certain assets and assumed certain liabilities of Produban Servicios Informaticos Generales S.L. and Ingenieria De Software Bancario S.L., both affiliates of Santander. The book value and fair value of the net assets acquired was $2.8 million and $15.3 million, respectively. Related to this transaction, in 2017, the Company received a net capital contribution from Santander of $2.8 million, representing cash received of $15.3 million and a return of capital of $12.5 million for the difference between the fair value of the assets purchased and the book value on the balance sheets of the affiliates. The Company re-evaluated the assets received on January 1, 2018 and recorded an additional $0.3 million to additional paid-in capital. The Company contributed these assets at book value of $3.1 million to SBNA, a subsidiary of the Company, on January 1, 2018. During the six-month period ended June 30, 2018, the Company recorded a $3.2 million deferred tax asset on the assets purchased by the Company to establish the intangible under Section 197 of the Internal Revenue Code. On March 29, 2017, SC entered into a Master Securities Purchase Agreement ("MSPA") with Santander, under which it has the option to sell a contractually determined amount of eligible prime loans to Santander through the SPAIN trust securitization platform, for a term ending in December 2018. SC will provide servicing on all loans originated under this arrangement. For the three-month and six-month periods ended June 30, 2017, the Company sold $0.5 billion and $1.2 billion, respectively, of loans at fair value under this MSPA. The MSPA was amended in March 2018 and, under this amended agreement, SC sold $1.2 billion and $2.6 billion, respectively, of prime loans to Santander at fair value during the three-month and six-month periods ended June 30, 2018. Total losses of $3.2 million and $20.1 million, respectively were recognized for the three-month and six-month periods ended June 30, 2018, respectively, compared to losses of $3.5 million and $6.2 million, respectively, during the comparable periods in 2017, which are included in Miscellaneous income, net in the Condensed Consolidated Statements of Operations. SC had $70.5 million and $13.0 million of collections due to Santander as of June 30, 2018 and December 31, 2017, respectively. Beginning in 2018, SC agreed to provide SBNA with origination support services in connection with the processing, underwriting, and purchase of RICs, primarily from Chrysler dealers. In addition, SC agreed to perform the servicing for any RICs originated on SBNA's behalf. During the three-month and six-month periods ended June 30, 2018, SC facilitated SBNA's purchase of $29 million and $53 million of RICs, respectively. SC recognizes referral fee income and servicing fee income related to this agreement that eliminates in the consolidation of SHUSA. |
BUSINESS SEGMENT INFORMATION |
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BUSINESS SEGMENT INFORMATION | BUSINESS SEGMENT INFORMATION Business Segment Products and Services The Company’s reportable segments are focused principally around the customers the Company serves. During the first quarter of 2018, the Chief Operating Decision Maker ("CODM") made certain changes in its business lines that drove a reorganization of its business leadership to provide enhanced customer service to its clients and to better align management teams and resources with the manner in which the CODM allocates resources and assesses business performance. Accordingly, the following changes were made within the Company's reportable segments:
During the second quarter of 2018, Santander renamed its Global and Corporate Banking ("GCB") business to Corporate and Investment Banking ("CIB") to more accurately reflect its business strategy and business proposition to clients, and to align with the name used by a majority of its competitors in the industry. There were no changes to composition of the reportable segment or reporting unit as a result of this change. All prior period results have been recast to conform to the new composition of reportable segments. The Company has identified the following reportable segments:
SC has entered into a number of intercompany agreements with the Bank as described above as part of the Other segment. All intercompany revenue and fees between the Bank and SC are eliminated in the consolidated results of the Company. NOTE 18. BUSINESS SEGMENT INFORMATION (continued) The Other category includes certain immaterial subsidiaries such as BSI, BSPR, SSLLC, and SFS, the unallocated interest expense on the Company's borrowings and other debt obligations and certain unallocated corporate income and indirect expenses. The Company’s segment results, excluding SC and the entities that have become part of the IHC, are derived from the Company’s business unit profitability reporting system by specifically attributing managed balance sheet assets, deposits and other liabilities and their related interest income or expense to each of the segments. FTP methodologies are utilized to allocate a cost for funds used or a credit for funds provided to business line deposits, loans and selected other assets using a matched funding concept. The methodology includes a liquidity premium adjustment, which considers an appropriate market participant spread for commercial loans and deposits by analyzing the mix of borrowings available to the Company with comparable maturity periods. Other income and expenses are managed directly by each reportable segment, including fees, service charges, salaries and benefits, and other direct expenses, as well as certain allocated corporate expenses, and are accounted for within each segment’s financial results. Accounting policies for the lines of business are the same as those used in preparation of the Condensed Consolidated Financial Statements with respect to activities specifically attributable to each business line. However, the preparation of business line results requires management to establish methodologies to allocate funding costs and benefits, expenses and other financial elements to each line of business. Where practical, the results are adjusted to present consistent methodologies for the segments. The application and development of management reporting methodologies is a dynamic process and is subject to periodic enhancements. The implementation of these enhancements to the internal management reporting methodology may materially affect the results disclosed for each segment with no impact on consolidated results. Whenever significant changes to management reporting methodologies take place, prior period information is reclassified wherever practicable. The CODM manages SC on a historical basis by reviewing the results of SC on a pre-Change in Control basis. The Results of Segments table discloses SC's operating information on the same basis that it is reviewed by the CODM. The adjustments column includes adjustments to reconcile SC's GAAP results to SHUSA's consolidated results. Results of Segments The following tables present certain information regarding the Company’s segments. NOTE 18. BUSINESS SEGMENT INFORMATION (continued)
NOTE 18. BUSINESS SEGMENT INFORMATION (continued)
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BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Policies) |
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Basis of Presentation | Basis of Presentation These Condensed Consolidated Financial Statements include the assets, liabilities, revenues and expense accounts of the Company and its consolidated subsidiaries, including the Bank, SC, and certain special purpose financing trusts utilized in financing transactions that are considered VIEs. The Company generally consolidates VIEs for which it is deemed to be the primary beneficiary and voting interest entities ("VOEs") in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. These Consolidated Financial Statements have been prepared by the Company pursuant to Securities and Exchange Commission ("SEC") regulations. Additionally, where applicable, the Company's accounting policies conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. In the opinion of management, the accompanying Condensed Consolidated Financial Statements reflect all adjustments of a normal and recurring nature necessary for a fair statement of the Consolidated Balance Sheets, Statements of Operations, Statements of Comprehensive Income, Statements of Stockholder's Equity and Statements of Cash Flows ("SCF") for the periods indicated, and contain adequate disclosure for the fair statement of this interim financial information. |
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Recently Adopted Accounting Standards and Recent Accounting Developments | Recently Adopted Accounting Standards Since January 1, 2018, the Company adopted the following Financial Accounting Standards Board ("FASB") Accounting Standards Updates (“ASUs"):
The Company adopted this ASU as of January 1, 2018 using the modified retrospective method of transition, resulting in an immaterial cumulative-effect adjustment recorded to opening retained earnings for the current period. The adoption of this ASU did not result in material changes in the timing of the Company's revenue recognition, but requires gross presentation of certain costs previously offset against revenue. This change in presentation is reflected in the current period and will increase both noninterest revenue and noninterest expense for the Company. The increase is predominantly associated with certain distribution costs on wealth management products (historically offset against Miscellaneous income), with the remainder of the increase associated with certain underwriting service costs (historically offset against Miscellaneous income). Refer to Note 15 for additional details. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue recognition standard, while prior period amounts have not been adjusted and continue to be reported in accordance with our historic accounting. The cumulative-effect of the changes made to our January 1, 2018 Condensed Consolidated Balance Sheet for the adoption of the new revenue recognition standard were as follows:
NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) The following discloses the impact on the Company's Condensed Balance Sheet at June 30, 2018 and the Condensed Statement of Operations for the three-month and six-month periods ended June 30, 2018 for the adoption of this new accounting standard:
NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) on the opening balance of retained earnings for the cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness. Refer to Note 12 for further discussion of the Company's derivatives.
Cumulative net impact to opening Retained earnings As a result of the adoption of the new accounting standards outlined above, the Company recorded a cumulative net increase to opening Retained earnings of $42.0 million. Those impacts were attributed to the following ASUs adopted during the period:
The adoption of the following ASUs did not have an impact on the Company's financial position or results of operations:
As required by the adoption of ASU 2016-18 and ASU 2014-09, the following additional accounting policy disclosures are required for the nature of cash restrictions and revenue recognized from contracts with customers from disclosures included in our Annual Report on Form 10-K for the year ended December 31, 2017: Cash, Cash Equivalents, and Restricted Cash Cash deposited to support securitization transactions, lockbox collections, and related required reserve accounts are recorded in the Company's Consolidated Balance Sheets as Restricted cash. Excess cash flows generated by Trusts are added to the restricted cash reserve account, creating additional over-collateralization until the contractual securitization requirement has been reached. Once the targeted reserve requirement is satisfied, additional excess cash flows generated by the Trusts are released to the Company as distributions from the Trusts. Lockbox collections are added to restricted cash and released when transferred to the appropriate warehouse line of credit or trust. The Company also maintains restricted cash primarily related to cash posted as collateral related to derivative agreements, cash restricted for investment purposes and cash advanced for loan purchases. NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) Revenue Recognized from Contracts with Customers Depository services Depository services are performed under an agreement with a customer, and those services include personal deposit account opening and maintaining, checking service, online banking service, debit card services, etc. Depository service fees related to customer deposits can generally be distinguished between monthly service fees and transactional fees within the single performance obligation of providing depository account services. Monthly account service and maintenance fees are provided over a period of time (usually a month), and revenue is recognized as the Company performs the service (usually at the end of the month). The services for transactional fees are performed at a point in time and revenue is recognized when the transaction occurs. Commissions and trailer fees Commission fees are earned from the selling of annuity contracts to customers on behalf of insurance companies, acting as the broker for certain equity trading, and sales of interests in mutual funds. The Company elected the expected value method for estimating commission fees due to the large number of customer contracts with similar characteristics. However, commissions and trailer fees are fully constrained as the Company cannot sufficiently estimate the consideration to which it could be entitled to earn. Commissions are generally associated with point-in-time transactions or agreements that are one year or less. The performance obligation is satisfied immediately and revenue is recognized as the Company performs the service. Interchange income, net The Company has entered into agreements with payment networks in which the Company will issue the payment network's credit card as part of the Company's credit card portfolio. Each time a cardholder makes a purchase at a merchant and the transaction is processed, the Company receives an interchange fee in exchange for the authorization and settlement services provided to the payment networks. The performance obligation for the Company is to provide authorization and settlement services to the payment network when the payment network submits a transaction for authorization. The Company considers the payment network to be the customer, and the Company is acting as a principal when performing the transaction authorization and settlement services. The performance obligation for authorization and settlement services is satisfied at a point in time, and revenue is recognized on the date when the Company authorizes and routes the payment to the merchant. The expenses paid to payment networks are accounted for as considerations payable to the customer and therefore reduce the transaction price. Therefore, interchange income is recorded net against the expenses paid to the payment network and the cost of rewards programs. The agreements also contain immaterial fixed consideration related to upfront sign-on bonuses and program development bonuses, which are amortized over the remainder of the agreement's life on a straight-line basis. Underwriting service fees SIS, as a registered broker-dealer, performs underwriting services by raising investment capital from investors on behalf of corporations that are issuing securities. Underwriting services have one performance obligation, which is satisfied on the day SIS purchases the securities. Underwriting services include multiple parties in delivering the performance obligation. The Company has evaluated whether it is the principal or agent when we provide underwriting services. The Company acts as the principal when performing underwriting services, and recognizes fees on a gross basis. Revenue is recorded as the difference between the price the Company pays the issuer of the securities and the public offering price, and expenses are recorded as the proportionate share of the underwriting costs incurred by SIS. The Company is the principal because we obtain control of the services provided by third-party vendors and combine them with other services as part of delivering on the underwriting service. Asset and wealth management fees Asset and wealth management fees includes fee income generated from discretionary investment management and non-discretionary investment advisory contracts with customers. Discretionary investment management fees are earned for the management of the assets in the customer's account and are are recognized as earned and charged to the customer on a quarterly basis. Non-discretionary NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) investment advisory fees are earned for providing investment advisory services to customers, such as recommending the re-balancing or restructuring of the assets in the customer’s account. The investment advisory fee is recognized as earned and charged to the customer on a quarterly basis. The fee for the discretionary and nondiscretionary contracts is based on a percentage of the average assets included in the customer’s account. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and ASU 2018-11 Targeted Improvements in August 2018. The guidance, as amended, in this update supersedes the current lease accounting guidance for both lessees and lessors under ASC 840, Leases. The new guidance requires lessees to evaluate whether a lease is a finance lease using criteria similar to what lessees use today to determine whether they have a capital lease. Leases not classified as finance leases are classified as operating leases. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. The lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similarly to today’s guidance for operating leases. The new guidance will require lessors to account for leases using an approach that is substantially similar to existing guidance. This new guidance will be effective for the Company for the first reporting period beginning after December 15, 2018, with earlier adoption permitted. The Company does not intend to early adopt this ASU. Entities may adopt the amendment retrospectively to each prior reporting period presented in the financial statements with the cumulative effect of initial application recognized at the beginning of the earliest comparative period presented. Alternatively, an entity may adopt the amendment using an optional method with initial application at the adoption date and recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption (comparative period financial statements and disclosures are presented in accordance with current GAAP). The Company is in the process of reviewing our existing property and equipment lease contracts, as well as service contracts that may include embedded leases. Upon adoption, the Company expects to report higher assets and liabilities from recording the present value of the future minimum lease payments of the leases. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This new guidance significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace today’s “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For AFS debt securities, entities will be required to record allowances rather than reduce the carrying amount, as they do today under the other-than-temporary impairment (“OTTI') model. The standard also simplifies the accounting model for purchased credit-impaired debt securities and loans. The new guidance will be effective for the Company for the first reporting period beginning after December 15, 2019, with earlier adoption permitted. Adoption of this new guidance can be applied only on a prospective basis as a cumulative-effect adjustment to retained earnings. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. It is expected that the new model will include different assumptions used in calculating credit losses, such as estimating losses over the estimated life of a financial asset, and will consider expected future changes in macroeconomic conditions. The adoption of this ASU may result in an increase to the Company’s allowance for credit losses ("ACL"), which will depend upon the nature and characteristics of the Company's portfolio at the adoption date, as well as the macroeconomic conditions and forecasts at that date. The Company currently does not intend to early adopt this new guidance. NOTE 2. RECENT ACCOUNTING DEVELOPMENTS (continued) In addition to those described in detail above, the Company is in the process of evaluating the following ASUs, and does not expect them to have a material impact on the Company's financial position, results of operations, or disclosures:
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Commercial Lending Asset Quality Indicators | Commercial Lending Asset Quality Indicators Commercial credit quality disaggregated by class of financing receivables is summarized according to standard regulatory classifications as follows: PASS. Asset is well-protected by the current net worth and paying capacity of the obligor or guarantors, if any, or by the fair value less costs to acquire and sell any underlying collateral in a timely manner. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) SPECIAL MENTION. Asset has potential weaknesses that deserve management’s close attention, which, if left uncorrected, may result in deterioration of the repayment prospects for an asset at some future date. Special mention assets are not adversely classified. SUBSTANDARD. Asset is inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. A well-defined weakness or weaknesses exist that jeopardize the liquidation of the debt. The loans are characterized by the distinct possibility that the Company will sustain some loss if deficiencies are not corrected. DOUBTFUL. Exhibits the inherent weaknesses of a substandard credit. Additional characteristics exist that make collection or liquidation in full highly questionable and improbable, on the basis of currently known facts, conditions and values. Possibility of loss is extremely high, but because of certain important and reasonable specific pending factors which may work to the advantage and strengthening of the credit, an estimated loss cannot yet be determined. LOSS. Credit is considered uncollectible and of such little value that it does not warrant consideration as an active asset. There may be some recovery or salvage value, but there is doubt as to whether, how much or when the recovery would occur. |
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Troubled Debt Restructurings | Commercial Loan TDRs All of the Company’s commercial loan modifications are based on the circumstances of the individual customer, including specific customers' complete relationships with the Company. Loan terms are modified to meet each borrower’s specific circumstances at a point in time and may allow for modifications such as term extensions and interest rate reductions. Modifications for commercial loan TDRs generally, although not always, result in bifurcation of the original loan into A and B notes. The A note is restructured to allow for upgraded risk rating and return to accrual status after a sustained period of payment performance has been achieved (typically six months for monthly payment schedules). The B note, if any, is structured as a deficiency note; the balance is charged off but the debt is usually not forgiven. Commercial TDRs are generally placed on non-accrual status until the Company believes repayment under the revised terms is reasonably assured and a sustained period of repayment performance has been achieved (typically six months for a monthly amortizing loan). TDRs are subject to analysis for specific reserves by either calculating the present value of expected future cash flows or, if collateral-dependent, calculating the fair value of the collateral less its estimated cost to sell. The TDR classification will remain on the loan until it is paid in full or liquidated. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) Consumer Loan TDRs The primary modification program for the Company’s residential mortgage and home equity portfolios is a proprietary program designed to keep customers in their homes and, when appropriate, prevent them from entering into foreclosure. The program is available to all customers facing a financial hardship regardless of their delinquency status. The main goal of the modification program is to review the customer’s entire financial condition to ensure that the proposed modified payment solution is affordable according to a specific debt-to-income (“DTI") ratio range. The main modification benefits of the program allow for term extensions, interest rate reductions, and/or deferment of principal. The Company reviews each customer on a case-by-case basis to determine which benefit or combination of benefits will be offered to achieve the target DTI range. For the Company’s other consumer portfolios, including RICs and auto loans, the terms of the modifications generally include one or a combination of: a reduction of the stated interest rate of the loan to a rate of interest lower than the current market rate for new debt with similar risk, an extension of the maturity date or principal forgiveness. Consumer TDRs excluding RICs are generally placed on non-accrual status until the Company believes repayment under the revised terms is reasonably assured and a sustained period of repayment performance has been achieved (typically six months for a monthly amortizing loan). Any loan that has remained current for the six months immediately prior to modification will remain on accrual status after the modification is implemented. RIC TDRs are placed on nonaccrual status when the Company believes repayment under the revised terms is not reasonably assured, and considered for return to accrual when a sustained period of repayment performance has been achieved. The TDR classification will remain on the loan until it is paid in full or liquidated. In addition to loans identified as TDRs above, the guidance also requires loans discharged under Chapter 7 bankruptcy proceedings to be considered TDRs and collateral-dependent, regardless of delinquency status. TDRs that are collateral-dependent loans must be written down to the fair market value of the collateral, less costs to sell and classified as non-accrual/non-performing loans (“NPLs") for the remaining life of the loan. TDR Impact to ALLL The ALLL is established to recognize losses inherent in funded loans intended to be HFI that are probable and can be reasonably estimated. Prior to loans being placed in TDR status, the Company generally measures its allowance under a loss contingency methodology in which consumer loans with similar risk characteristics are pooled and loss experience information is monitored for credit risk and deterioration with statistical tools considering factors such as delinquency, LTV and credit scores. Upon TDR modification, the Company generally measures impairment based on a present value of expected future cash flows methodology considering all available evidence, by discounting expected future cash flows using the original effective interest rate or fair value of collateral less costs to sell. The amount of the required ALLL is equal to the difference between the loan’s impaired value and the recorded investment. RIC TDRs that subsequently default continue to have impairment measured based on the difference between the recorded investment of the RIC and the present value of expected cash flows. For the Company's other consumer TDR portfolios, impairment on subsequent defaults is generally measured based on the fair value of the collateral, if applicable, less its estimated cost to sell. Typically, commercial loans whose terms are modified in a TDR will have been identified as impaired prior to modification and accounted for generally using a present value of expected future cash flows methodology, unless the loan is considered collateral-dependent. Loans considered collateral-dependent are measured for impairment based on their fair values of collateral less estimated cost to sell. Accordingly, upon TDR modification or if a TDR modification subsequently defaults, the allowance methodology remains unchanged. |
BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Tables) |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Those impacts were attributed to the following ASUs adopted during the period:
The cumulative-effect of the changes made to our January 1, 2018 Condensed Consolidated Balance Sheet for the adoption of the new revenue recognition standard were as follows:
NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (continued) The following discloses the impact on the Company's Condensed Balance Sheet at June 30, 2018 and the Condensed Statement of Operations for the three-month and six-month periods ended June 30, 2018 for the adoption of this new accounting standard:
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INVESTMENT SECURITIES (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Debt Securities, Available-for-sale | The following tables present the amortized cost, gross unrealized gains and losses and approximate fair values of debt securities AFS at the dates indicated:
(1) Reflects the reclassification of the Company's investments in equity securities to Other investments as a result of the adoption of ASU 2016-01 as of January 1, 2018. |
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Summary of Held-to-maturity Securities | The following tables present the amortized cost, gross unrealized gains and losses and approximate fair values of debt securities HTM at the dates indicated:
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Investments Classified by Contractual Maturity Date | Contractual maturities of the Company’s AFS debt securities at June 30, 2018 were as follows:
Contractual maturities of the Company’s HTM debt securities at June 30, 2018 were as follows:
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Gross Unrealized Loss and Fair Value of Debt Securities Available-for-Sale | The following tables present the aggregate amount of unrealized losses as of June 30, 2018 and December 31, 2017 on securities in the Company’s AFS investment portfolios classified according to the amount of time those securities have been in a continuous loss position:
(1) Reflects the reclassification of the Company's investments in equity securities to Other investments as a result of the adoption of ASU 2016-01 as of January 1, 2018. |
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Gross Unrealized Loss and Fair Value of Debt Securities Held-to-maturity | The following tables present the aggregate amount of unrealized losses as of June 30, 2018 and December 31, 2017 on debt securities in the Company’s HTM investment portfolios classified according to the amount of time those securities have been in a continuous loss position:
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Gains (Losses) and Proceeds on Sales of Securities | Proceeds from sales of investments in debt securities and the realized gross gains and losses from those sales are as follows:
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Schedule of Other Investments | Other Investments consisted of the following as of:
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Realized and Unrealized Gains (Losses) on Equity Securities |
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LOANS AND ALLOWANCE FOR CREDIT LOSSES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans and Leases Receivable Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Receivable | The following presents the composition of the gross loans and leases HFI by portfolio and by rate type:
(1)Total LHFI includes deferred loan fees, net of deferred origination costs and unamortized purchase premiums, net of discounts as well as purchase accounting adjustments. These items resulted in a net increase in the loan balances of $1.5 billion and $1.3 billion as of June 30, 2018 and December 31, 2017, respectively. (2)Other commercial includes commercial equipment vehicle financing ("CEVF") leveraged leases and loans. (3)Other consumer primarily includes recreational vehicle ("RV") and marine loans. The composition of the portfolio segment is as follows:
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Allowance for Credit Losses by Portfolio Segment | The activity in the ACL by portfolio segment for the three-month and six-month periods ended June 30, 2018 and 2017 was as follows:
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued)
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) The following table presents the activity in the allowance for loan losses for the RICs acquired in the Change in Control and those originated by SC subsequent to the Change in Control.
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Schedule of Non-accrual Loans | The recorded investment in non-accrual loans disaggregated by class of financing receivables and other non-performing assets is summarized as follows:
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Aging Analysis of Loan Portfolio | The age of recorded investments in past due loans and accruing loans 90 days or greater past due disaggregated by class of financing receivables is summarized as follows:
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Schedule of Impaired Loans by Class | Impaired loans disaggregated by class of financing receivables are summarized as follows:
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued) The Company recognized interest income, not including the impact of purchase accounting adjustments, of $475.0 million for the six-month period ended June 30, 2018 on approximately $5.8 billion of TDRs that were in performing status as of June 30, 2018.
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Schedule of Loans by Credit Quality Indicators | Commercial loan credit quality indicators by class of financing receivables are summarized as follows:
Consumer Lending Asset Quality Indicators-Credit Score Consumer financing receivables for which either an internal or external credit score is a core component of the allowance model are summarized by credit score as follows:
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Schedule of Financing Receivable by LTV | Residential mortgage and home equity financing receivables by LTV and FICO range are summarized as follows:
(1) Includes LHFS. (2) Residential mortgages and home equity loans and lines of credit in the "N/A" range for LTV or FICO score primarily represent the balance on loans serviced by others, in run-off portfolios or for which a current LTV or FICO score is unavailable. (3) Allowance model considers LTV for financing receivables in first lien position for the Company and combined LTV ("CLTV") for financing receivables in second lien position for the Company.
NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued)
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Summary of Performing and Non-performing TDRs | The following table summarizes the Company’s performing and non-performing TDRs at the dates indicated:
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Schedule of Troubled Debt Restructurings | The following tables detail the activity of TDRs for the three-month and six-month periods ended June 30, 2018 and 2017, respectively:
(1) Pre-TDR modification outstanding recorded investment amount is the month-end balance prior to the month in which the modification occurred. (2) Post-TDR modification outstanding recorded investment amount is the month-end balance for the month in which the modification occurred. (3) The post-TDR modification outstanding recorded investment amounts for residential mortgages exclude interest reserves. (4) Other modifications may include modifications such as interest rate reductions, fee waivers, or capitalization of fees. NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES (continued)
(1) Pre-TDR modification outstanding recorded investment amount is the month-end balance prior to the month in which the modification occurred.
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Schedule of Troubled Debt Restructurings Subsequently Defaulted | The following table details period-end recorded investment balances of TDRs that became TDRs during the past twelve-month period and have subsequently defaulted during the three-month and six-month periods ended June 30, 2018 and June 30, 2017, respectively.
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OPERATING LEASE ASSETS, NET (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Operating Lease Assets, Net | Operating lease assets, net consisted of the following as of June 30, 2018 and December 31, 2017:
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Schedule of Future Minimum Rental Payments Due to the Company Under Operating Leases | The following summarizes the future minimum rental payments due to the Company as lessor under operating leases as of June 30, 2018 (in thousands):
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VIEs (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity and Securitizations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Variable Interest Entities | The assets of consolidated VIEs that are included in the Company's Condensed Consolidated Financial Statements, presented reflecting the transfer of the underlying assets in order to reflect legal ownership, that can be used to settle obligations of the consolidated VIEs and the liabilities of these consolidated entities for which creditors (or beneficial interest holders) do not have recourse to our general credit were as follows:
(1) Includes $63.9 million and $1.1 billion of RICs HFS at June 30, 2018 and December 31, 2017, respectively. (2) Reflects the impacts of purchase accounting. |
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Summary of Cash Flows Received | Below is a summary of the cash flows received from the on-balance sheet Trusts for the periods indicated:
(1) Includes additional advances on existing securitizations. (2) These amounts are not reflected in the accompanying Condensed Consolidated SCF because the cash flows are between the VIEs and other entities included in the consolidation. A summary of the cash flows received from the off-balance sheet Trusts for the periods indicated is as follows:
(1) Represents the UPB at the time of original securitization. |
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Schedule of Off-balance Sheet Variable Interest Entities Portfolio | The portfolio was comprised as follows:
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GOODWILL AND OTHER INTANGIBLES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | The following table presents the Company's goodwill by its reporting units at June 30, 2018:
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Schedule of Finite-Lived Intangible Assets | The following table details amounts related to the Company's intangible assets subject to amortization for the dates indicated. NOTE 7. GOODWILL AND OTHER INTANGIBLES (continued)
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Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated aggregate amortization expense related to intangibles, excluding any impairment charges, for each of the five succeeding calendar years ending December 31 is:
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OTHER ASSETS (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Assets | The following is a detail of items that comprise other assets at June 30, 2018 and December 31, 2017:
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Schedule of Servicing Assets at Fair Value | The following table presents a summary of activity for the Company's residential MSRs that are included in the Condensed Consolidated Balance Sheets:
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DEPOSITS AND OTHER CUSTOMER ACCOUNTS (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Deposits and Other Customer Accounts | Deposits and other customer accounts are summarized as follows:
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BORROWINGS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Borrowings and Other Debt Obligation | The following table presents information regarding the Bank's borrowings and other debt obligations at the dates indicated:
The following table presents information regarding the Parent Company and its subsidiaries' borrowings and other debt obligations at the dates indicated:
(1) These notes bear interest at a rate equal to the three-month LIBOR plus 100 basis points per annum. (2) These notes will bear interest at a rate equal to the three-month LIBOR plus 105 basis points per annum. |
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SC | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Borrowings and Other Debt Obligation | The following tables present information regarding SC's secured structured financings as of June 30, 2018 and December 31, 2017:
(1) Securitizations executed under Rule 144A of the Securities Act are included within this balance. (2) Secured structured financings may be collateralized by the SC's collateral overages of other issuances. NOTE 10. BORROWINGS (continued)
(1) SC has entered into various securitization transactions involving its retail automobile installment loans and leases. These transactions are accounted for as secured financings and therefore both the securitized RICs and the related securitization debt issued by SPEs remain on the Condensed Consolidated Balance Sheets. The maturity of this debt is based on the timing of repayments from the securitized assets. (2) Securitizations executed under Rule 144A of the Securities Act are included within this balance. The following tables present information regarding SC's credit facilities as of June 30, 2018 and December 31, 2017:
(3) The maturity of this repurchase facility ranges from July 2018 to September 2018. Approximately 38% of this matured and settled in July 2018.
(5) This repurchase facility was settled on maturity in July 2018.
NOTE 10. BORROWINGS (continued)
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ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (Tables) |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income / (Loss) | The following table presents the components of accumulated other comprehensive income/(loss), net of related tax, for the three-month and six-month periods ended June 30, 2018 and 2017, respectively.
(4) Includes impact of other comprehensive income reclassified to Retained earnings as a result of the adoption of ASU 2018-02. Refer to Note 1 for further discussion. NOTE 11. ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (continued)
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DERIVATIVES (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impact of Derivative Activities in the Condensed Consolidated Statement of Operations | The following Condensed Consolidated Statement of Operations line items were impacted by the Company’s derivative activities for the three-month and six-month periods ended June 30, 2018 and 2017:
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Offsetting of Financial Assets |
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Offsetting of Financial Liabilities |
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Designated as hedging instrument | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments | Derivatives designated as accounting hedges at June 30, 2018 and December 31, 2017 included:
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Not designated as hedging instrument | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Derivative Activities | Other derivative activities at June 30, 2018 and December 31, 2017 included:
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FAIR VALUE (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables present the assets and liabilities that are measured at fair value on a recurring basis by major product category and fair value hierarchy as of June 30, 2018 and December 31, 2017.
(4) RICs collateralized by vehicle titles at SC and RV/marine loans at SBNA. (5) Residential mortgage loans (6) Investment in debt securities AFS disclosed on the Consolidated Balance Sheets at December 31, 2017 included $10.8 million of equity securities valued using the net asset value as a practical expedient that are not presented within this table. |
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Fair Value Measurements, Nonrecurring | Assets measured at fair value on a nonrecurring basis that were still held on the balance sheet were as follows:
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Increases and Decreases in Value of Certain Assets Measured at Fair Value on Nonrecurring Basis | The following table presents the increases and decreases in value of certain assets that are measured at fair value on a nonrecurring basis for which a fair value adjustment has been included in the Condensed Consolidated Statements of Operations relating to assets held at period-end:
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Rollforward for Recurring Assets and Liabilities | The tables below present the changes in Level 3 balances for the three-month and six-month periods ended June 30, 2018 and 2017, respectively, for those assets and liabilities measured at fair value on a recurring basis.
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Quantitative Information on Level 3 Recurring Assets and Liabilities | The following table presents quantitative information about the significant unobservable inputs within significant Level 3 recurring and nonrecurring assets and liabilities at June 30, 2018 and December 31, 2017:
NOTE 14. FAIR VALUE (continued)
(11) Excludes MSR valued on a non-recurring basis for which we do not consider there to be significant unobservable assumptions. |
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Schedule of Fair Value of Financial Instruments | The carrying amounts and estimated fair values, as well as the level within the fair value hierarchy, of the Company's financial instruments are as follows:
(2) Investment in debt securities AFS disclosed on the Consolidated Balance Sheets at December 31, 2017 included $10.8 million of equity securities valued using net asset value as a practical expedient that are not presented within this table. The balance of these equity securities at June 30, 2018 is $10.9 million and is included in the Other investments line item on the Condensed Consolidated Balance Sheets. |
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Summary of Difference Between Fair Value and Principal Balance of LHFS | The following table summarizes the differences between the fair value and the principal balance of LHFS and RICs measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017:
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NON-INTEREST INCOME (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Details of Non-Interest Income | The following table presents the details of the Company's Non-interest income for the following periods:
(1) - Prior period amounts have not been adjusted under the modified retrospective method. For further information, see Note 1. |
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Disaggregation of Revenue from Contracts with Customers | The following table presents the Company's Non-interest income disaggregated by revenue source.
(1) - Prior period amounts have not been adjusted under the modified retrospective method. For further information, see Note 1. (2) - Primarily recorded in the Company's Condensed Consolidated Statements of Operations within Consumer and commercial fees. (3) - Primarily recorded in the Company's Condensed Consolidated Statements of Operations within Miscellaneous income, net. (4) - The balance presented excludes certain revenue streams that are considered in-scope and presented above. |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Commitments Amount | The following table details the amount of commitments at the dates indicated:
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Schedule of Commitments to Extend Credit, Expiration Periods | The following table details the amount of commitments to extend credit expiring per period as of the dates indicated:
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Schedule of Letters of Credit, Expiration Periods | The following table details the amount of letters of credit expiring per period as of the dates indicated:
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RELATED PARTY TRANSACTIONS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Contributions from Santander | Contributions from Santander that impact common stock and paid in capital within the Condensed Consolidated Statements of Stockholder's Equity are disclosed within the table below:
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BUSINESS SEGMENT INFORMATION (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information | The following tables present certain information regarding the Company’s segments. NOTE 18. BUSINESS SEGMENT INFORMATION (continued)
NOTE 18. BUSINESS SEGMENT INFORMATION (continued)
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BASIS OF PRESENTATION AND ACCOUNTING POLICIES (General) (Details) - SC |
6 Months Ended |
---|---|
Jun. 30, 2018 | |
Noncontrolling Interest [Line Items] | |
Financing contract term | 10 years |
Ownership percentage by parent | 68.00% |
Percentage owned by noncontrolling shareholders | 32.00% |
BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Intermediate Holding Company) (Details) - USD ($) $ in Thousands |
Jul. 02, 2018 |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|---|---|---|
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||
Total assets | $ 130,138,694 | $ 128,295,952 | $ 128,294,030 | $ 134,755,695 | ||
Total liabilities | 105,986,215 | 104,587,021 | 104,588,399 | |||
Total stockholders' equity | $ 24,152,479 | $ 23,708,931 | $ 23,705,631 | $ 22,897,254 | $ 22,378,758 | |
SAM | Subsequent Event | ||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||
Total assets | $ 5,400 | |||||
Total liabilities | 1,000 | |||||
Total stockholders' equity | $ 4,400 |
BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Operating Lease Cash Flow Classification) (Details) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Net cash from investing activities | $ (5,486,642) | $ (304,670) |
Net cash from operating activities | $ 3,909,460 | 2,505,613 |
Correction of error in operating lease cash flow classification | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Net cash from investing activities | 288,000 | |
Net cash from operating activities | $ 288,000 |
BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Cumulative Effect of Changes) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Assets - LHFI | $ 83,136,904 | [1],[2] | $ 80,746,366 | $ 80,740,852 | [1],[2] | ||||||||
Other assets | 3,930,251 | [2],[3] | 3,628,835 | 3,632,427 | [2],[3] | ||||||||
Total assets | 130,138,694 | 128,295,952 | 128,294,030 | $ 134,755,695 | |||||||||
Liabilities - other liabilities | 1,085,133 | [2] | 798,025 | 799,403 | [2] | ||||||||
Total liabilities | 105,986,215 | 104,587,021 | 104,588,399 | ||||||||||
Stockholders' equity - retained earnings | 3,931,614 | 3,465,974 | 3,462,674 | ||||||||||
Total stockholders' equity | $ 24,152,479 | 23,708,931 | $ 23,705,631 | $ 22,897,254 | $ 22,378,758 | ||||||||
Difference between Revenue Guidance in Effect before and after Topic 606 | ASU 2014-09 | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Assets - LHFI | 5,514 | ||||||||||||
Other assets | (3,592) | ||||||||||||
Total assets | 1,922 | ||||||||||||
Liabilities - other liabilities | (1,378) | ||||||||||||
Total liabilities | (1,378) | ||||||||||||
Stockholders' equity - retained earnings | 3,300 | ||||||||||||
Total stockholders' equity | $ 3,300 | ||||||||||||
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BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Impact on Balance Sheet) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Assets - LHFI | $ 83,136,904 | [1],[2] | $ 80,746,366 | $ 80,740,852 | [1],[2] | ||||||||
Other assets | 3,930,251 | [2],[3] | 3,628,835 | 3,632,427 | [2],[3] | ||||||||
Total assets | 130,138,694 | 128,295,952 | 128,294,030 | $ 134,755,695 | |||||||||
Liabilities - other liabilities | 1,085,133 | [2] | 798,025 | 799,403 | [2] | ||||||||
Total liabilities | 105,986,215 | 104,587,021 | 104,588,399 | ||||||||||
Stockholders' equity - retained earnings | 3,931,614 | 3,465,974 | 3,462,674 | ||||||||||
Total stockholders' equity | 24,152,479 | $ 23,708,931 | $ 23,705,631 | $ 22,897,254 | $ 22,378,758 | ||||||||
Calculated under Revenue Guidance in Effect before Topic 606 | |||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||
Assets - LHFI | 83,131,949 | ||||||||||||
Other assets | 3,933,647 | ||||||||||||
Total assets | 130,137,135 | ||||||||||||
Liabilities - other liabilities | 1,086,511 | ||||||||||||
Total liabilities | 105,987,593 | ||||||||||||
Stockholders' equity - retained earnings | 3,928,677 | ||||||||||||
Total stockholders' equity | $ 24,149,542 | ||||||||||||
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BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Impact on Statements of Operations) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Consumer and commercial fees | $ 136,165 | $ 162,334 | $ 276,337 | $ 316,702 | ||||
Miscellaneous income/(loss) | [1],[2] | 113,283 | 69,383 | 234,085 | 144,526 | |||
Total non-interest income | 819,173 | 729,809 | 1,620,380 | 1,455,884 | ||||
Technology, outside service, and marketing expense | 156,010 | 162,259 | 308,292 | 297,771 | ||||
Loan expense | 97,679 | 95,872 | 194,493 | 194,217 | ||||
Other administrative expenses | 135,565 | 95,096 | 239,746 | 197,334 | ||||
Total general and administrative expenses | 1,416,948 | 1,341,636 | 2,822,608 | 2,651,475 | ||||
Income before income tax provision | 527,206 | 379,746 | 880,463 | 622,392 | ||||
Income tax provision | 168,035 | 91,983 | 263,356 | 170,920 | ||||
Net income | 359,171 | 287,763 | 617,107 | 451,472 | ||||
Calculated under Revenue Guidance in Effect before Topic 606 | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Consumer and commercial fees | 137,051 | 162,334 | 274,944 | 316,702 | ||||
Miscellaneous income/(loss) | 105,241 | 224,123 | ||||||
Total non-interest income | 812,017 | $ 729,809 | 1,609,025 | $ 1,455,884 | ||||
Technology, outside service, and marketing expense | 154,284 | 304,395 | ||||||
Loan expense | 100,197 | 199,390 | ||||||
Other administrative expenses | 130,050 | 226,832 | ||||||
Total general and administrative expenses | 1,411,596 | 2,810,694 | ||||||
Income before income tax provision | 527,558 | 881,022 | ||||||
Income tax provision | 168,158 | 263,552 | ||||||
Net income | $ 359,400 | $ 617,470 | ||||||
|
BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Recently Adopted Accounting Standards, Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Equity securities from Investments AFS | $ (10,814) | ||
Equity securities in other investments | $ 10,917 | $ 0 | |
ASU 2016-01 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Equity securities from Investments AFS | $ 10,000 | ||
Equity securities in other investments | $ 10,000 | ||
ASU 2018-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Reclassification of AOCI to retained earnings | $ 39,100 |
BASIS OF PRESENTATION AND ACCOUNTING POLICIES (Cumulative Net Impact to Opening Retained Earnings) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | $ 8,455 | $ 25,709 |
Retained Earnings | ||
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | 47,549 | $ 14,764 |
Retained Earnings | Subsidiary | ||
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | 5,573 | |
Retained Earnings | Cumulative-effect adjustment upon adoption of new accounting standards | ||
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | 41,976 | |
Retained Earnings | Adoption of ASU 2014-09, Revenue Recognition | ||
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | 3,300 | |
Retained Earnings | Adoption of ASU 2016-1, Financial Instruments | ||
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | (418) | |
Retained Earnings | Adoption of ASU 2018-02, Statement of Comprehensive Income | ||
Retained Earnings Adjustments [Line Items] | ||
Impact to Retained earnings | $ 39,094 |
INVESTMENT SECURITIES (Available-for-sale Securities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
---|---|---|---|
Debt Securities: | |||
Amortized Cost | $ 13,461,826 | $ 14,635,767 | |
Gross Unrealized Gains | 11,351 | 11,725 | |
Gross Unrealized Loss | (408,304) | (234,309) | |
Fair Value | 13,064,873 | 14,413,183 | |
Equity Securities: | |||
Amortized Cost | 11,428 | ||
Gross Unrealized Gains | 0 | ||
Gross Unrealized Loss | (614) | ||
Fair Value | 10,814 | ||
U.S. Treasury securities | |||
Debt Securities: | |||
Amortized Cost | 1,632,805 | 1,006,219 | |
Gross Unrealized Gains | 171 | 0 | |
Gross Unrealized Loss | (15,174) | (8,107) | |
Fair Value | 1,617,802 | 998,112 | $ 739,400 |
Corporate debt securities | |||
Debt Securities: | |||
Amortized Cost | 6,454 | 11,639 | |
Gross Unrealized Gains | 0 | 21 | |
Gross Unrealized Loss | (1) | 0 | |
Fair Value | 6,453 | 11,660 | |
Asset-backed securities (“ABS”) | |||
Debt Securities: | |||
Amortized Cost | 475,279 | 501,575 | |
Gross Unrealized Gains | 5,066 | 6,901 | |
Gross Unrealized Loss | (2,868) | (1,314) | |
Fair Value | 477,477 | 507,162 | |
State and municipal securities | |||
Debt Securities: | |||
Amortized Cost | 20 | 23 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Loss | 0 | 0 | |
Fair Value | 20 | 23 | |
Government National Mortgage Association (GNMA) - Residential | |||
Debt Securities: | |||
Amortized Cost | 3,818,120 | 4,745,998 | |
Gross Unrealized Gains | 5,752 | 3,531 | |
Gross Unrealized Loss | (109,410) | (62,524) | |
Fair Value | 3,714,462 | 4,687,005 | |
GNMA - Commercial | |||
Debt Securities: | |||
Amortized Cost | 866,797 | 1,377,449 | |
Gross Unrealized Gains | 0 | 179 | |
Gross Unrealized Loss | (22,528) | (19,917) | |
Fair Value | 844,269 | 1,357,711 | |
Federal Home Loan Mortgage Corporation (FHLMC) and Federal National Mortage Association (FNMA) - Residential | |||
Debt Securities: | |||
Amortized Cost | 6,610,005 | 6,958,433 | |
Gross Unrealized Gains | 237 | 1,093 | |
Gross Unrealized Loss | (257,435) | (141,393) | |
Fair Value | 6,352,807 | 6,818,133 | |
FHLMC and FNMA - Commercial | |||
Debt Securities: | |||
Amortized Cost | 52,346 | 23,003 | |
Gross Unrealized Gains | 125 | 0 | |
Gross Unrealized Loss | (888) | (440) | |
Fair Value | $ 51,583 | $ 22,563 |
INVESTMENT SECURITIES (Held-to-maturity Debt Securities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | $ 2,920,087 | $ 1,799,808 |
Gross Unrealized Gains | 622 | 1,047 |
Gross Unrealized Loss | (94,210) | (26,917) |
Fair Value | 2,826,499 | 1,773,938 |
Government National Mortgage Association (GNMA) - Residential | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 1,866,434 | 1,447,669 |
Gross Unrealized Gains | 0 | 722 |
Gross Unrealized Loss | (69,059) | (26,150) |
Fair Value | 1,797,375 | 1,422,241 |
GNMA - Commercial | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 1,053,653 | 352,139 |
Gross Unrealized Gains | 622 | 325 |
Gross Unrealized Loss | (25,151) | (767) |
Fair Value | $ 1,029,124 | $ 351,697 |
INVESTMENT SECURITIES (Securities Pledged as Collateral) (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | $ 6,200.0 | $ 5,900.0 |
Collateral with Federal Reserve Bank | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | 3,100.0 | 3,000.0 |
Public fund deposits | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | 2,300.0 | 2,300.0 |
Repurchase agreements, hedging activities and recourse on loan sales | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | 82.2 | 243.8 |
Deposits with Clearing Organizations | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | 423.9 | 0.0 |
Overnight customer deposits | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | $ 312.8 | $ 387.9 |
INVESTMENT SECURITIES (Other Investments) (Details) - USD ($) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
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Investments, Debt and Equity Securities [Abstract] | ||||
AFS investment securities transferred to HTM investment securities | $ 1,167,189,000 | $ 0 | ||
Accrued investment income receivable | $ 47,000,000 | $ 47,000,000 | $ 47,000,000 | |
FHLB Stock, par value (in usd per share) | $ 100 | $ 100 | ||
Purchases of FHLB stock | $ 23,900,000 | $ 34,100,000 | ||
FHLB stock redeemed | 37,100,000 | 63,000,000 | ||
Gain (loss) on redemption of FHLB stock | 0 | |||
Purchase of FRB stock | 0 | 0 | ||
Equity securities | $ 10,917,000 | $ 10,917,000 | $ 0 |
INVESTMENT SECURITIES (Contractual Maturity of Available-for-sale Debt Securities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Amortized Cost | ||
Due within one year | $ 788,156 | |
Due after 1 year but within 5 years | 1,211,917 | |
Due after 5 years but within 10 years | 181,937 | |
Due after 10 years | 11,279,816 | |
Amortized Cost | 13,461,826 | $ 14,635,767 |
Fair Value | ||
Due within one year | 573,700 | |
Due after 1 year but within 5 years | 1,416,164 | |
Due after 5 years but within 10 years | 246,373 | |
Due after 10 years | 10,828,636 | |
Fair Value | $ 13,064,873 | $ 14,413,183 |
INVESTMENT SECURITIES (Contractual Maturity of Held-to-maturity Debt Securities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Amortized Cost | ||
Due after 10 years | $ 2,920,087 | |
Amortized Cost | 2,920,087 | $ 1,799,808 |
Fair Value | ||
Due after 10 years | 2,826,499 | |
Fair Value | $ 2,826,499 | $ 1,773,938 |
INVESTMENT SECURITIES (Gross Unrealized Loss and Fair Value of Available-for-sale Debt Securities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Fair Value | ||
Less than 12 months | $ 6,030,746 | $ 6,702,254 |
12 months or longer | 5,282,205 | 5,982,268 |
Unrealized Losses | ||
Less than 12 months | (151,003) | (61,328) |
12 months or longer | (257,301) | (172,981) |
U.S. Treasury securities | ||
Fair Value | ||
Less than 12 months | 788,943 | 998,112 |
12 months or longer | 246,895 | 0 |
Unrealized Losses | ||
Less than 12 months | (10,459) | (8,107) |
12 months or longer | (4,715) | 0 |
Corporate debt securities | ||
Fair Value | ||
Less than 12 months | 6,439 | 0 |
12 months or longer | 13 | 0 |
Unrealized Losses | ||
Less than 12 months | (1) | 0 |
12 months or longer | 0 | 0 |
ABS | ||
Fair Value | ||
Less than 12 months | 43,740 | 8,013 |
12 months or longer | 86,900 | 103,559 |
Unrealized Losses | ||
Less than 12 months | (440) | (125) |
12 months or longer | (2,428) | (1,189) |
GNMA - Residential | ||
Fair Value | ||
Less than 12 months | 1,132,254 | 1,236,716 |
12 months or longer | 1,812,027 | 2,583,955 |
Unrealized Losses | ||
Less than 12 months | (29,533) | (8,600) |
12 months or longer | (79,877) | (53,924) |
GNMA - Commercial | ||
Fair Value | ||
Less than 12 months | 805,131 | 1,022,452 |
12 months or longer | 39,138 | 251,209 |
Unrealized Losses | ||
Less than 12 months | (21,818) | (11,492) |
12 months or longer | (710) | (8,425) |
FHLMC and FNMA - Residential | ||
Fair Value | ||
Less than 12 months | 3,247,620 | 3,429,678 |
12 months or longer | 3,082,057 | 3,017,533 |
Unrealized Losses | ||
Less than 12 months | (88,401) | (32,899) |
12 months or longer | (169,034) | (108,494) |
FHLMC and FNMA - Commercial | ||
Fair Value | ||
Less than 12 months | 6,619 | 6,948 |
12 months or longer | 15,175 | 15,614 |
Unrealized Losses | ||
Less than 12 months | (351) | (103) |
12 months or longer | $ (537) | (337) |
Equity securities | ||
Equity Securities: | ||
Fair Value, Less than 12 months | 335 | |
Unrealized Losses, Less than 12 months | (2) | |
Fair Value, 12 months or longer | 10,398 | |
Unrealized Losses, 12 months or longer | $ (612) |
INVESTMENT SECURITIES (Gross Unrealized Loss and Fair Value of Held-to-maturity Debt Securities) (Details) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Fair Value | ||
Less than 12 months | $ 1,091,172 | $ 553,273 |
12 months or longer | 1,649,842 | 739,612 |
Unrealized Losses | ||
Less than 12 months | (31,328) | (7,186) |
12 months or longer | (62,882) | (19,731) |
GNMA - Residential | ||
Fair Value | ||
Less than 12 months | 464,230 | 434,322 |
12 months or longer | 1,333,145 | 739,612 |
Unrealized Losses | ||
Less than 12 months | (14,342) | (6,419) |
12 months or longer | (54,717) | (19,731) |
GNMA - Commercial | ||
Fair Value | ||
Less than 12 months | 626,942 | 118,951 |
12 months or longer | 316,697 | 0 |
Unrealized Losses | ||
Less than 12 months | (16,986) | (767) |
12 months or longer | $ (8,165) | $ 0 |
INVESTMENT SECURITIES (Other-Than-Temporary Impairment) (Details) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018
USD ($)
security
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
security
|
Jun. 30, 2017
USD ($)
|
|
Investments, Debt and Equity Securities [Abstract] | ||||
OTTI in earnings related to investment securities | $ | $ 0 | $ 0 | $ 0 | $ 0 |
Number of securities in unrealized loss position | security | 503 | 503 |
INVESTMENT SECURITIES (Gains (Losses) and Proceeds on Sale of Securities) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Debt Securities, Available-for-sale [Line Items] | |||||
Proceeds from the sales of debt securities AFS | $ 0 | $ 1,306,125 | $ 39,446 | $ 1,306,125 | |
Gross realized gains | 419 | 11,125 | 0 | 11,125 | |
Gross realized losses | 0 | (2,076) | (244) | (1,556) | |
OTTI | 0 | 0 | 0 | 0 | |
Net realized gains/(losses) | 419 | 9,049 | (244) | 9,569 | |
Net realized gains/(losses) on trading securities | 400 | (2,100) | (200) | (1,600) | |
Losses on sale of AFS investment securities | 18 | ||||
Book value | 13,064,873 | 13,064,873 | $ 14,413,183 | ||
Gains on sale of AFS investment securities | 11,100 | 11,100 | |||
MBS | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Losses on sale of AFS investment securities | 18 | ||||
Book value | 300 | 555,600 | 300 | 555,600 | |
Gains on sale of AFS investment securities | 9,300 | 9,300 | |||
U.S. Treasury securities | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Book value | $ 1,617,802 | 739,400 | $ 1,617,802 | 739,400 | $ 998,112 |
Gains on sale of AFS investment securities | $ 1,800 | $ 1,800 |
INVESTMENT SECURITIES (Schedule of Other Investments) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Investments, Debt and Equity Securities [Abstract] | ||
FHLB of Pittsburgh and Federal Reserve Bank stock | $ 488,134 | $ 516,693 |
Low Income Housing Tax Credit investments (LIHTC) | 115,933 | 88,170 |
Equity securities not held for trading | 10,917 | 0 |
CDs with a maturity greater than 90 days | 84,000 | 54,000 |
Trading securities | 1,874 | 1 |
Total | $ 700,858 | $ 658,864 |
INVESTMENT SECURITIES (Realized and Unrealized Gains (Losses) on Equity Securities (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Investments, Debt and Equity Securities [Abstract] | ||||
Net gains/(losses) on equity securities | $ (78) | $ 36 | $ (31) | $ 18 |
Less: net gains/(losses) recognized during the period on equity securities sold during the period | 0 | 0 | 0 | 0 |
Unrealized gains/(losses) recognized during the reporting period on equity securities still held at the reporting period date | $ (78) | $ 36 | $ (31) | $ 18 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Narrative) (Details) - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Jan. 01, 2018 |
|||||||||
Loans Receivable [Line Items] | |||||||||||||
Loans pledged as collateral | $ 48,300,000 | $ 50,800,000 | |||||||||||
Loans held-for-sale (LHFS) | [1] | 1,559,799 | 2,522,486 | ||||||||||
Accrued interest receivable | 535,773 | 563,607 | |||||||||||
Loans and leases receivable | 83,136,904 | [2],[3] | 80,740,852 | [2],[3] | $ 80,746,366 | ||||||||
Financing receivable | $ 84,696,703 | 83,263,338 | |||||||||||
Percentage of payment needed on past due loans for qualification | 90.00% | ||||||||||||
Minimum amount for commercial non-accrual loans (in excess of) | $ 1,000 | ||||||||||||
Troubled debt restructurings | $ 6,613,306 | 6,807,172 | |||||||||||
TDR, threshold period of sustained repayment performance | 6 months | ||||||||||||
TDR, threshold period loan needed to remain current prior to modification to remain on accrual status | 6 months | ||||||||||||
TDRs, number of days past due after modification considered to have subsequently defaulted | 90 days | ||||||||||||
Performing | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Interest income | $ 475,000 | 795,400 | |||||||||||
Troubled debt restructurings | 5,809,300 | 5,824,304 | |||||||||||
SC | Chrysler Capital Loans | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Loan originations | $ 4,700,000 | $ 3,400,000 | |||||||||||
SC | Chrysler Capital Loans | Accounts Receivable | Credit Concentration Risk | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Percentage of loan origination | 49.00% | 43.00% | |||||||||||
Loans receivable | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Accrued interest receivable | $ 490,800 | 515,900 | |||||||||||
Mortgage warehouse facilities | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Loans and leases receivable | 499,200 | ||||||||||||
Proceeds from sale of receivables | 515,800 | ||||||||||||
Gain from sale of receivables | 16,700 | ||||||||||||
Retail installment contracts and auto loans | SC | Chrysler Capital Leases | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Financing receivable | $ 8,000,000 | $ 8,200,000 | |||||||||||
Retail installment contracts and auto loans | SC | Chrysler Capital Leases | Accounts Receivable | Credit Concentration Risk | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Percentage of loan origination | 33.00% | 37.00% | |||||||||||
Retail installment contracts, originated | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Percentage of payment needed on past due loans for qualification | 90.00% | 50.00% | |||||||||||
Retail installment contracts | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
TDRs, number of days past due after modification considered to have subsequently defaulted | 120 days | ||||||||||||
Consumer | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Loans and leases receivable | $ 43,597,100 | $ 41,574,142 | |||||||||||
Consumer | Personal unsecured loans | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
LHFS | 956,455 | 1,100,000 | |||||||||||
Financing receivable | 2,233,756 | 2,347,767 | |||||||||||
Consumer | Retail installment contracts and auto loans | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Loans and leases receivable | 59,568 | 18,142 | |||||||||||
Consumer | Retail installment contracts, originated | |||||||||||||
Loans Receivable [Line Items] | |||||||||||||
Loans and leases receivable | $ 25,344,732 | $ 23,063,282 | |||||||||||
|
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Loan and Lease Portfolio Composition) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
||||||
---|---|---|---|---|---|---|---|---|---|
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 83,136,904 | [1],[2] | $ 80,746,366 | $ 80,740,852 | [1],[2] | ||||
Loans held for investment with fixed rate of interest | 52,903,597 | 50,653,790 | |||||||
Loans held for investment with variable rate of interest | $ 30,233,307 | $ 30,087,062 | |||||||
Loans held for investment, percent of total loans | 100.00% | 100.00% | |||||||
Loans held for investment with fixed rate of interest, percent of total loans | 63.60% | 62.70% | |||||||
Loans held for investment with variable rate of interest, percent of total loans | 36.40% | 37.30% | |||||||
Net increase in loan balances | $ 1,500,000 | $ 1,300,000 | |||||||
Commercial | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 39,539,804 | $ 39,166,710 | |||||||
Loans held for investment, percent of total loans | 47.60% | 48.40% | |||||||
Commercial | Commercial real estate (CRE) loans | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 9,053,402 | $ 9,279,225 | |||||||
Loans held for investment, percent of total loans | 10.90% | 11.50% | |||||||
Commercial | Commercial and industrial loans | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 14,695,706 | $ 14,438,311 | |||||||
Loans held for investment, percent of total loans | 17.70% | 17.90% | |||||||
Commercial | Multifamily loans | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 8,323,925 | $ 8,274,435 | |||||||
Loans held for investment, percent of total loans | 10.00% | 10.10% | |||||||
Commercial | Other commercial | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 7,466,771 | $ 7,174,739 | |||||||
Loans held for investment, percent of total loans | 9.00% | 8.90% | |||||||
Consumer | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 43,597,100 | $ 41,574,142 | |||||||
Loans held for investment, percent of total loans | 52.40% | 51.60% | |||||||
Consumer | RICs and auto loans - originated | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 25,404,300 | $ 23,081,424 | |||||||
Consumer loans secured by real estate | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 15,146,943 | $ 14,754,498 | |||||||
Loans held for investment, percent of total loans | 18.20% | 18.30% | |||||||
Consumer loans secured by real estate | Residential mortgages | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 9,464,713 | $ 8,846,765 | |||||||
Loans held for investment, percent of total loans | 11.40% | 11.00% | |||||||
Consumer loans secured by real estate | Home equity loans and lines of credit | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 5,682,230 | $ 5,907,733 | |||||||
Loans held for investment, percent of total loans | 6.80% | 7.30% | |||||||
Consumer loans not secured by real estate | RICs and auto loans - originated | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 25,404,300 | $ 23,081,424 | |||||||
Loans held for investment, percent of total loans | 30.60% | 28.60% | |||||||
Consumer loans not secured by real estate | RICs and auto loans - purchased | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 1,246,606 | $ 1,834,868 | |||||||
Loans held for investment, percent of total loans | 1.50% | 2.30% | |||||||
Consumer loans not secured by real estate | Personal unsecured loans | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 1,277,301 | $ 1,285,677 | |||||||
Loans held for investment, percent of total loans | 1.50% | 1.60% | |||||||
Consumer loans not secured by real estate | Other consumer | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 521,950 | $ 617,675 | |||||||
Loans held for investment, percent of total loans | 0.60% | 0.80% | |||||||
|
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Retail Installment Contracts and Auto Loans) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
||||||
---|---|---|---|---|---|---|---|---|---|
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 83,136,904 | [1],[2] | $ 80,746,366 | $ 80,740,852 | [1],[2] | ||||
Consumer | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | 43,597,100 | 41,574,142 | |||||||
Consumer | Retail installment contracts and auto loans | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | 26,650,906 | 24,916,292 | |||||||
Consumer | RICs - Purchased HFI | |||||||||
Loans Receivable [Line Items] | |||||||||
Unpaid principal balance (UPB) | 1,310,800 | 1,929,548 | |||||||
UPB, FVO | 15,756 | 24,926 | |||||||
Total UPB | 1,326,556 | 1,954,474 | |||||||
Purchase marks | (79,950) | (119,606) | |||||||
Total loans held for investment | 1,246,606 | 1,834,868 | |||||||
Purchase marks, FVO | 3,500 | 5,500 | |||||||
Consumer | RICs - Originated HFI | |||||||||
Loans Receivable [Line Items] | |||||||||
Total UPB | 25,540,231 | 23,373,202 | |||||||
Net discount | (195,499) | (309,920) | |||||||
Total loans held for investment | 25,344,732 | 23,063,282 | |||||||
Consumer | Auto loans | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | 59,568 | 18,142 | |||||||
Consumer | RICs - originated | |||||||||
Loans Receivable [Line Items] | |||||||||
Total loans held for investment | $ 25,404,300 | $ 23,081,424 | |||||||
|
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Rollforward of Allowance for Credit Losses) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | $ 3,853,209 | $ 3,922,863 | $ 3,911,575 | $ 3,814,464 |
(Release of) / Provision for loan and lease losses | 382,727 | 611,685 | 904,506 | 1,349,021 |
Charge-offs | (1,053,185) | (1,189,433) | (2,305,081) | (2,452,886) |
Recoveries | 627,983 | 608,493 | 1,299,734 | 1,243,009 |
Charge-offs, net of recoveries | (425,202) | (580,940) | (1,005,347) | (1,209,877) |
ALLL, end of period | 3,810,734 | 3,953,608 | 3,810,734 | 3,953,608 |
Reserve for Unfunded Lending Commitments Roll Forward [Roll Forward] | ||||
Reserve for unfunded lending commitments, beginning of period | 89,866 | 120,396 | 109,111 | 122,419 |
(Release of) / Provision for reserve for unfunded lending commitments | (2,893) | (6,917) | (22,138) | (8,807) |
Loss on unfunded lending commitments | (1,668) | (1,801) | ||
Reserve for unfunded lending commitments, end of period | 86,973 | 111,811 | 86,973 | 111,811 |
Total ACL, end of period | 3,897,707 | 4,065,419 | 3,897,707 | 4,065,419 |
Ending balance, individually evaluated for impairment | 1,617,535 | 1,710,716 | 1,617,535 | 1,710,716 |
Ending balance, collectively evaluated for impairment | 2,193,199 | 2,242,892 | 2,193,199 | 2,242,892 |
Financing receivables: | ||||
Ending balance | 84,696,703 | 85,460,590 | 84,696,703 | 85,460,590 |
Ending balance, evaluated under the FVO or lower of cost or fair value | 1,587,331 | 2,537,429 | 1,587,331 | 2,537,429 |
Ending balance, individually evaluated for impairment | 6,842,616 | 6,842,685 | 6,842,616 | 6,842,685 |
Ending balance, collectively evaluated for impairment | 76,266,756 | 76,080,476 | 76,266,756 | 76,080,476 |
Commercial | ||||
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | 462,074 | 453,019 | 443,796 | 449,835 |
(Release of) / Provision for loan and lease losses | (33,213) | 26,687 | 8,020 | 45,465 |
Charge-offs | (16,665) | (60,514) | (49,625) | (86,687) |
Recoveries | 14,624 | 9,056 | 24,629 | 19,635 |
Charge-offs, net of recoveries | (2,041) | (51,458) | (24,996) | (67,052) |
ALLL, end of period | 426,820 | 428,248 | 426,820 | 428,248 |
Reserve for Unfunded Lending Commitments Roll Forward [Roll Forward] | ||||
Reserve for unfunded lending commitments, beginning of period | 89,543 | 119,620 | 108,805 | 121,613 |
(Release of) / Provision for reserve for unfunded lending commitments | (2,885) | (6,937) | (22,147) | (8,797) |
Loss on unfunded lending commitments | (1,668) | (1,801) | ||
Reserve for unfunded lending commitments, end of period | 86,658 | 111,015 | 86,658 | 111,015 |
Total ACL, end of period | 513,478 | 539,263 | 513,478 | 539,263 |
Ending balance, individually evaluated for impairment | 83,148 | 73,946 | 83,148 | 73,946 |
Ending balance, collectively evaluated for impairment | 343,672 | 354,302 | 343,672 | 354,302 |
Financing receivables: | ||||
Ending balance | 39,605,332 | 41,233,130 | 39,605,332 | 41,233,130 |
Ending balance, evaluated under the FVO or lower of cost or fair value | 65,528 | 160,252 | 65,528 | 160,252 |
Ending balance, individually evaluated for impairment | 509,693 | 640,255 | 509,693 | 640,255 |
Ending balance, collectively evaluated for impairment | 39,030,111 | 40,432,623 | 39,030,111 | 40,432,623 |
Consumer | ||||
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | 3,344,112 | 3,422,821 | 3,420,756 | 3,317,606 |
(Release of) / Provision for loan and lease losses | 415,940 | 584,998 | 896,486 | 1,303,556 |
Charge-offs | (1,036,520) | (1,128,919) | (2,255,456) | (2,366,199) |
Recoveries | 613,359 | 599,437 | 1,275,105 | 1,223,374 |
Charge-offs, net of recoveries | (423,161) | (529,482) | (980,351) | (1,142,825) |
ALLL, end of period | 3,336,891 | 3,478,337 | 3,336,891 | 3,478,337 |
Reserve for Unfunded Lending Commitments Roll Forward [Roll Forward] | ||||
Reserve for unfunded lending commitments, beginning of period | 323 | 776 | 306 | 806 |
(Release of) / Provision for reserve for unfunded lending commitments | (8) | 20 | 9 | (10) |
Loss on unfunded lending commitments | 0 | 0 | ||
Reserve for unfunded lending commitments, end of period | 315 | 796 | 315 | 796 |
Total ACL, end of period | 3,337,206 | 3,479,133 | 3,337,206 | 3,479,133 |
Ending balance, individually evaluated for impairment | 1,534,387 | 1,636,770 | 1,534,387 | 1,636,770 |
Ending balance, collectively evaluated for impairment | 1,802,504 | 1,841,567 | 1,802,504 | 1,841,567 |
Financing receivables: | ||||
Ending balance | 45,091,371 | 44,227,460 | 45,091,371 | 44,227,460 |
Ending balance, evaluated under the FVO or lower of cost or fair value | 1,521,803 | 2,377,177 | 1,521,803 | 2,377,177 |
Ending balance, individually evaluated for impairment | 6,332,923 | 6,202,430 | 6,332,923 | 6,202,430 |
Ending balance, collectively evaluated for impairment | 37,236,645 | 35,647,853 | 37,236,645 | 35,647,853 |
Consumer | Total | ||||
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | 3,105,366 | 3,203,105 | 3,163,211 | 3,097,219 |
(Release of) / Provision for loan and lease losses | 367,402 | 557,397 | 838,732 | 1,244,045 |
Charge-offs | (998,013) | (1,089,471) | (2,182,038) | (2,286,210) |
Recoveries | 606,678 | 590,306 | 1,261,528 | 1,206,283 |
Charge-offs, net of recoveries | (391,335) | (499,165) | (920,510) | (1,079,927) |
ALLL, end of period | 3,081,433 | 3,261,337 | 3,081,433 | 3,261,337 |
Consumer | Purchased | ||||
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | 322,726 | 495,221 | 384,167 | 559,092 |
(Release of) / Provision for loan and lease losses | (30,031) | 55,141 | (45,861) | 81,266 |
Charge-offs | (76,265) | (150,143) | (181,775) | (338,829) |
Recoveries | 49,791 | 68,452 | 109,690 | 167,142 |
Charge-offs, net of recoveries | (26,474) | (81,691) | (72,085) | (171,687) |
ALLL, end of period | 266,221 | 468,671 | 266,221 | 468,671 |
Consumer | Originated | ||||
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | 2,782,640 | 2,707,884 | 2,779,044 | 2,538,127 |
(Release of) / Provision for loan and lease losses | 397,433 | 502,256 | 884,593 | 1,162,779 |
Charge-offs | (921,748) | (939,328) | (2,000,263) | (1,947,381) |
Recoveries | 556,887 | 521,854 | 1,151,838 | 1,039,141 |
Charge-offs, net of recoveries | (364,861) | (417,474) | (848,425) | (908,240) |
ALLL, end of period | 2,815,212 | 2,792,666 | 2,815,212 | 2,792,666 |
Unallocated | ||||
Allowance for Loan Losses [Roll Forward] | ||||
Allowance for loan and lease losses (ALLL), beginning of period | 47,023 | 47,023 | 47,023 | 47,023 |
(Release of) / Provision for loan and lease losses | 0 | 0 | 0 | 0 |
Charge-offs | 0 | 0 | 0 | 0 |
Recoveries | 0 | 0 | 0 | 0 |
Charge-offs, net of recoveries | 0 | 0 | 0 | 0 |
ALLL, end of period | 47,023 | 47,023 | 47,023 | 47,023 |
Reserve for Unfunded Lending Commitments Roll Forward [Roll Forward] | ||||
Reserve for unfunded lending commitments, beginning of period | 0 | 0 | 0 | 0 |
(Release of) / Provision for reserve for unfunded lending commitments | 0 | 0 | 0 | 0 |
Loss on unfunded lending commitments | 0 | 0 | ||
Reserve for unfunded lending commitments, end of period | 0 | 0 | 0 | 0 |
Total ACL, end of period | 47,023 | 47,023 | 47,023 | 47,023 |
Ending balance, individually evaluated for impairment | 0 | 0 | 0 | 0 |
Ending balance, collectively evaluated for impairment | 47,023 | 47,023 | 47,023 | 47,023 |
Financing receivables: | ||||
Ending balance | 0 | 0 | 0 | 0 |
Ending balance, evaluated under the FVO or lower of cost or fair value | 0 | 0 | 0 | 0 |
Ending balance, individually evaluated for impairment | 0 | 0 | 0 | 0 |
Ending balance, collectively evaluated for impairment | $ 0 | $ 0 | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Non-accrual Loans) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | $ 2,901,957 | $ 2,949,997 |
Foreclosed and other repossessed assets | 148,641 | 212,882 |
Nonperforming | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Other real estate owned (OREO) | 118,502 | 130,777 |
Repossessed vehicles | 147,430 | 210,692 |
Foreclosed and other repossessed assets | 1,212 | 2,190 |
Total OREO and other repossessed assets | 267,144 | 343,659 |
Total non-performing assets | 3,169,101 | 3,293,656 |
Commercial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 390,992 | 464,533 |
Commercial | CRE | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 123,305 | 139,236 |
Commercial | Commercial and industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 162,134 | 230,481 |
Commercial | Multifamily | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 28,501 | 11,348 |
Commercial | Other commercial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 77,052 | 83,468 |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 2,510,965 | 2,485,464 |
Consumer | Residential mortgages | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 241,886 | 265,436 |
Consumer | Home equity loans and lines of credit | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 125,834 | 134,162 |
Consumer | RICs and auto loans - originated | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 1,924,294 | 1,816,226 |
Consumer | RICs and auto loans - purchased | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 203,346 | 256,617 |
Consumer | Personal unsecured loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | 7,035 | 2,366 |
Consumer | Other consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans | $ 8,570 | $ 10,657 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Age Analysis of Past Due Loans) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 4,601,577 | $ 5,321,431 |
Current | 80,095,126 | 77,941,907 |
Total Financing Receivables | 84,696,703 | 83,263,338 |
Recorded Investment Greater than 90 Days and Accruing | 88,162 | 96,461 |
30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 3,787,412 | 4,349,047 |
90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 814,165 | 972,384 |
Commercial | CRE | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 97,369 | 125,698 |
Current | 8,956,033 | 9,153,527 |
Total Financing Receivables | 9,053,402 | 9,279,225 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Commercial | CRE | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 15,236 | 25,174 |
Commercial | CRE | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 82,133 | 100,524 |
Commercial | Commercial and industrial loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 147,249 | 125,508 |
Current | 14,613,986 | 14,461,981 |
Total Financing Receivables | 14,761,235 | 14,587,489 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
LHFS | 65,500 | 149,200 |
Commercial | Commercial and industrial loans | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 66,136 | 49,584 |
Commercial | Commercial and industrial loans | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 81,113 | 75,924 |
Commercial | Multifamily | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 13,907 | 6,552 |
Current | 8,310,018 | 8,267,883 |
Total Financing Receivables | 8,323,925 | 8,274,435 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Commercial | Multifamily | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 5,538 | 3,562 |
Commercial | Multifamily | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 8,369 | 2,990 |
Commercial | Other commercial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 26,694 | 37,380 |
Current | 7,440,076 | 7,137,359 |
Total Financing Receivables | 7,466,770 | 7,174,739 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Commercial | Other commercial | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 23,740 | 34,021 |
Commercial | Other commercial | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 2,954 | 3,359 |
Consumer | Residential mortgages | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 384,320 | 428,335 |
Current | 9,338,096 | 8,628,600 |
Total Financing Receivables | 9,722,416 | 9,056,935 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
LHFS | 257,700 | 210,200 |
Consumer | Residential mortgages | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 189,762 | 217,558 |
Consumer | Residential mortgages | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 194,558 | 210,777 |
Consumer | Home equity loans and lines of credit | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 125,044 | 142,894 |
Current | 5,557,186 | 5,764,839 |
Total Financing Receivables | 5,682,230 | 5,907,733 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Consumer | Home equity loans and lines of credit | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 42,235 | 50,919 |
Consumer | Home equity loans and lines of credit | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 82,809 | 91,975 |
Consumer | RICs and auto loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
LHFS | 280,113 | 1,100,000 |
Consumer | RICs and auto loans - originated | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 3,268,296 | 3,732,766 |
Current | 22,416,117 | 20,449,706 |
Total Financing Receivables | 25,684,413 | 24,182,472 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Consumer | RICs and auto loans - originated | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 3,038,768 | 3,405,721 |
Consumer | RICs and auto loans - originated | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 229,528 | 327,045 |
Consumer | RICs and auto loans - purchased | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 322,061 | 492,751 |
Current | 924,545 | 1,342,117 |
Total Financing Receivables | 1,246,606 | 1,834,868 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Consumer | RICs and auto loans - purchased | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 300,474 | 452,235 |
Consumer | RICs and auto loans - purchased | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 21,587 | 40,516 |
Consumer | Personal unsecured loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 191,907 | 190,448 |
Current | 2,041,849 | 2,157,319 |
Total Financing Receivables | 2,233,756 | 2,347,767 |
Recorded Investment Greater than 90 Days and Accruing | 88,162 | 96,461 |
LHFS | 956,455 | 1,100,000 |
Consumer | Personal unsecured loans | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 91,172 | 85,394 |
Consumer | Personal unsecured loans | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 100,735 | 105,054 |
Consumer | Other consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 24,730 | 39,099 |
Current | 497,220 | 578,576 |
Total Financing Receivables | 521,950 | 617,675 |
Recorded Investment Greater than 90 Days and Accruing | 0 | 0 |
Consumer | Other consumer | 30-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 14,351 | 24,879 |
Consumer | Other consumer | 90 Days or Greater | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 10,379 | $ 14,220 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Impaired Loans) (Details) - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable, recorded investment | $ 6,870,042 | $ 7,164,184 |
Impaired financing receivable, UPB | 7,189,160 | 7,601,163 |
Impaired financing receivable, related specific reserves | 1,617,535 | 1,854,154 |
Impaired financing receivables, average recorded investment | 7,017,117 | 6,778,426 |
Commercial | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable, recorded investment | 494,651 | 577,963 |
Impaired financing receivable, UPB | 551,124 | 685,000 |
Impaired financing receivable, related specific reserves | 83,148 | 102,326 |
Impaired financing receivables, average recorded investment | 536,308 | 587,630 |
Commercial | CRE | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 123,390 | 126,406 |
Impaired financing receivable with related allowance recorded, recorded investment | 88,132 | 97,680 |
Impaired financing receivable with no related allowance recorded, UPB | 131,958 | 174,842 |
Impaired financing receivable with related allowance recorded, UPB | 101,985 | 117,730 |
Impaired financing receivable, related specific reserves | 12,762 | 18,523 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 124,898 | 139,063 |
Impaired financing receivable with related allowance recorded, average recorded investment | 92,906 | 118,492 |
Commercial | Commercial and industrial | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 42,551 | 82,541 |
Impaired financing receivable with related allowance recorded, recorded investment | 152,889 | 176,769 |
Impaired financing receivable with no related allowance recorded, UPB | 56,786 | 96,324 |
Impaired financing receivable with related allowance recorded, UPB | 171,757 | 200,382 |
Impaired financing receivable, related specific reserves | 47,874 | 59,696 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 62,546 | 75,338 |
Impaired financing receivable with related allowance recorded, average recorded investment | 164,829 | 196,674 |
Commercial | Multifamily | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 15,051 | 9,887 |
Impaired financing receivable with related allowance recorded, recorded investment | 0 | 6,201 |
Impaired financing receivable with no related allowance recorded, UPB | 15,984 | 10,838 |
Impaired financing receivable with related allowance recorded, UPB | 0 | 6,201 |
Impaired financing receivable, related specific reserves | 0 | 313 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 12,469 | 10,129 |
Impaired financing receivable with related allowance recorded, average recorded investment | 3,101 | 4,566 |
Commercial | Other commercial | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 2,143 | 767 |
Impaired financing receivable with related allowance recorded, recorded investment | 70,495 | 77,712 |
Impaired financing receivable with no related allowance recorded, UPB | 2,159 | 911 |
Impaired financing receivable with related allowance recorded, UPB | 70,495 | 77,772 |
Impaired financing receivable, related specific reserves | 22,512 | 23,794 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 1,455 | 903 |
Impaired financing receivable with related allowance recorded, average recorded investment | 74,104 | 42,465 |
Consumer | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable, recorded investment | 6,375,391 | 6,586,221 |
Impaired financing receivable, UPB | 6,638,036 | 6,916,163 |
Impaired financing receivable, related specific reserves | 1,534,387 | 1,751,828 |
Impaired financing receivables, average recorded investment | 6,480,809 | 6,190,796 |
Consumer | Residential mortgages | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 149,804 | 107,320 |
Impaired financing receivable with related allowance recorded, recorded investment | 272,569 | 322,092 |
Impaired financing receivable with no related allowance recorded, UPB | 202,187 | 128,458 |
Impaired financing receivable with related allowance recorded, UPB | 312,075 | 392,833 |
Impaired financing receivable, related specific reserves | 30,277 | 40,963 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 128,562 | 141,195 |
Impaired financing receivable with related allowance recorded, average recorded investment | 297,331 | 303,361 |
Consumer | Home equity loans and lines of credit | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 52,375 | 52,397 |
Impaired financing receivable with related allowance recorded, recorded investment | 62,999 | 64,827 |
Impaired financing receivable with no related allowance recorded, UPB | 54,442 | 54,421 |
Impaired financing receivable with related allowance recorded, UPB | 75,158 | 77,435 |
Impaired financing receivable, related specific reserves | 5,221 | 4,770 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 52,386 | 50,635 |
Impaired financing receivable with related allowance recorded, average recorded investment | 63,913 | 57,345 |
Consumer | RICs and auto loans - originated | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 8 | |
Impaired financing receivable with related allowance recorded, recorded investment | 4,886,182 | 4,788,299 |
Impaired financing receivable with no related allowance recorded, UPB | 8 | |
Impaired financing receivable with related allowance recorded, UPB | 4,921,618 | 4,847,929 |
Impaired financing receivable, related specific reserves | 1,243,143 | 1,350,022 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 4 | |
Impaired financing receivable with related allowance recorded, average recorded investment | 4,837,241 | 4,029,808 |
Consumer | RICs and auto loans - purchased | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 11,091 | 16,192 |
Impaired financing receivable with related allowance recorded, recorded investment | 878,021 | 1,166,476 |
Impaired financing receivable with no related allowance recorded, UPB | 14,249 | 20,783 |
Impaired financing receivable with related allowance recorded, UPB | 992,305 | 1,318,306 |
Impaired financing receivable, related specific reserves | 247,611 | 347,663 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 13,642 | 25,283 |
Impaired financing receivable with related allowance recorded, average recorded investment | 1,022,249 | 1,511,212 |
Consumer | Personal unsecured loans | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 31,380 | 30,992 |
Impaired financing receivable with related allowance recorded, recorded investment | 16,473 | 16,477 |
Impaired financing receivable with no related allowance recorded, UPB | 31,380 | 30,992 |
Impaired financing receivable with related allowance recorded, UPB | 16,860 | 16,661 |
Impaired financing receivable, related specific reserves | 7,005 | 6,259 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 31,186 | 28,500 |
Impaired financing receivable with related allowance recorded, average recorded investment | 16,475 | 16,668 |
Consumer | Other consumer | ||
Financing Receivable, Impaired [Line Items] | ||
Impaired financing receivable with no related allowance recorded, recorded investment | 4,138 | 9,557 |
Impaired financing receivable with related allowance recorded, recorded investment | 10,351 | 11,592 |
Impaired financing receivable with no related allowance recorded, UPB | 4,138 | 13,055 |
Impaired financing receivable with related allowance recorded, UPB | 13,616 | 15,290 |
Impaired financing receivable, related specific reserves | 1,130 | 2,151 |
Impaired financing receivable with no related allowance recorded, average recorded investment | 6,848 | 14,446 |
Impaired financing receivable with related allowance recorded, average recorded investment | $ 10,972 | $ 12,343 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Lending Asset Quality Indicators) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | $ 39,605,332 | $ 39,315,888 |
Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 37,111,188 | 36,641,228 |
Special mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 1,583,162 | 1,722,400 |
Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 745,812 | 783,065 |
Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 165,170 | 169,195 |
CRE | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 9,053,402 | 9,279,225 |
CRE | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 8,083,421 | 8,281,626 |
CRE | Special mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 622,906 | 645,835 |
CRE | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 318,542 | 317,510 |
CRE | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 28,533 | 34,254 |
Commercial and industrial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 14,761,235 | 14,587,489 |
Commercial and industrial loans | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 13,542,599 | 13,176,248 |
Commercial and industrial loans | Special mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 786,928 | 941,683 |
Commercial and industrial loans | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 357,163 | 398,325 |
Commercial and industrial loans | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 74,545 | 71,233 |
Multifamily | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 8,323,925 | 8,274,435 |
Multifamily | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 8,153,959 | 8,123,727 |
Multifamily | Special mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 116,139 | 105,225 |
Multifamily | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 53,827 | 45,483 |
Multifamily | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 0 | 0 |
Remaining commercial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 7,466,770 | 7,174,739 |
Remaining commercial | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 7,331,209 | 7,059,627 |
Remaining commercial | Special mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 57,189 | 29,657 |
Remaining commercial | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | 16,280 | 21,747 |
Remaining commercial | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial loans | $ 62,092 | $ 63,708 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Consumer Lending Asset Quality Indicators - Credit Score) (Details) - Consumer - RICs and auto loans - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Loans Receivable [Line Items] | ||
Financing receivable | $ 26,931,019 | $ 26,017,340 |
Percent, RICs and auto loans | 100.00% | 100.00% |
LHFS | $ 280,113 | $ 1,100,000 |
FICO score not applicable | ||
Loans Receivable [Line Items] | ||
Financing receivable | $ 3,403,051 | $ 4,530,238 |
Percent, RICs and auto loans | 12.60% | 17.40% |
FICO score less than 600 | ||
Loans Receivable [Line Items] | ||
Financing receivable | $ 14,547,771 | $ 13,395,203 |
Percent, RICs and auto loans | 54.00% | 51.40% |
FICO score of 600 to 639 | ||
Loans Receivable [Line Items] | ||
Financing receivable | $ 4,812,533 | $ 4,332,278 |
Percent, RICs and auto loans | 17.90% | 16.70% |
FICO score of 640 or greater | ||
Loans Receivable [Line Items] | ||
Financing receivable | $ 4,167,664 | $ 3,759,621 |
Percent, RICs and auto loans | 15.50% | 14.50% |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Consumer Lending Asset Quality Indicators - FICO and CLTV Range) (Details) - Consumer - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | $ 9,722,416 | $ 9,056,935 |
Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,682,230 | 5,907,733 |
LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 322,097 | 372,997 |
LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 227,400 | 210,736 |
LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,574,494 | 5,229,768 |
LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 3,739,217 | 3,789,095 |
LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 2,197,763 | 1,977,764 |
LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,492,565 | 1,613,086 |
LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 805,329 | 740,731 |
LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 767,681 | 663,899 |
LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 142,443 | 174,109 |
LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 19,796 | 25,345 |
LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 35,256 | 46,431 |
LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 80,605 | 120,707 |
FICO score not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 328,525 | 380,089 |
FICO score not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 185,201 | 155,464 |
FICO score not applicable | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 321,527 | 372,116 |
FICO score not applicable | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 182,480 | 154,690 |
FICO score not applicable | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 6,177 | 6,759 |
FICO score not applicable | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,754 | 536 |
FICO score not applicable | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 696 | 1,214 |
FICO score not applicable | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 967 | 238 |
FICO score not applicable | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 125 | 0 |
FICO score not applicable | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 0 |
FICO score not applicable | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 0 |
FICO score not applicable | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 0 |
FICO score not applicable | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 0 |
FICO score not applicable | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 0 |
FICO score less than 600 | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 345,678 | 343,842 |
FICO score less than 600 | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 291,148 | 302,863 |
FICO score less than 600 | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 122 | 21 |
FICO score less than 600 | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 7,595 | 8,064 |
FICO score less than 600 | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 225,222 | 220,737 |
FICO score less than 600 | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 194,995 | 190,657 |
FICO score less than 600 | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 57,160 | 55,108 |
FICO score less than 600 | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 66,231 | 64,554 |
FICO score less than 600 | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 36,241 | 35,617 |
FICO score less than 600 | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 23,164 | 23,834 |
FICO score less than 600 | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 16,682 | 16,634 |
FICO score less than 600 | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 2,478 | 2,505 |
FICO score less than 600 | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,291 | 6,020 |
FICO score less than 600 | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,645 | 22,954 |
FICO score of 600 to 639 | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 275,519 | 276,680 |
FICO score of 600 to 639 | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 234,546 | 244,325 |
FICO score of 600 to 639 | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 45 |
FICO score of 600 to 639 | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,127 | 6,276 |
FICO score of 600 to 639 | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 165,555 | 155,920 |
FICO score of 600 to 639 | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 161,678 | 158,461 |
FICO score of 600 to 639 | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 40,221 | 42,420 |
FICO score of 600 to 639 | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 53,759 | 61,250 |
FICO score of 600 to 639 | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 32,254 | 35,009 |
FICO score of 600 to 639 | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 32,891 | 34,331 |
FICO score of 600 to 639 | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 7,206 | 9,236 |
FICO score of 600 to 639 | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 723 | 2,696 |
FICO score of 600 to 639 | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 3,875 | 6,259 |
FICO score of 600 to 639 | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 6,776 | 9,102 |
FICO Score of 640 to 679 | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 607,848 | 597,986 |
FICO Score of 640 to 679 | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 436,512 | 464,618 |
FICO Score of 640 to 679 | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 0 | 37 |
FICO Score of 640 to 679 | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 3,788 | 6,745 |
FICO Score of 640 to 679 | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 303,105 | 320,248 |
FICO Score of 640 to 679 | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 289,718 | 297,003 |
FICO Score of 640 to 679 | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 110,602 | 94,601 |
FICO Score of 640 to 679 | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 120,930 | 127,347 |
FICO Score of 640 to 679 | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 84,804 | 90,708 |
FICO Score of 640 to 679 | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 100,378 | 86,740 |
FICO Score of 640 to 679 | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 14,430 | 19,465 |
FICO Score of 640 to 679 | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,733 | 3,011 |
FICO Score of 640 to 679 | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 7,226 | 2,641 |
FICO Score of 640 to 679 | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 7,646 | 14,058 |
FICO Score of 680 to 719 | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,159,477 | 1,089,764 |
FICO Score of 680 to 719 | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 785,070 | 812,329 |
FICO Score of 680 to 719 | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 51 | 98 |
FICO Score of 680 to 719 | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 7,299 | 8,875 |
FICO Score of 680 to 719 | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 584,346 | 554,058 |
FICO Score of 680 to 719 | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 511,686 | 500,234 |
FICO Score of 680 to 719 | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 263,437 | 236,602 |
FICO Score of 680 to 719 | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 229,819 | 258,284 |
FICO Score of 680 to 719 | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 137,239 | 136,980 |
FICO Score of 680 to 719 | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 166,263 | 147,754 |
FICO Score of 680 to 719 | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 22,310 | 24,675 |
FICO Score of 680 to 719 | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 2,900 | 3,955 |
FICO Score of 680 to 719 | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,241 | 10,317 |
FICO Score of 680 to 719 | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 13,956 | 20,261 |
FICO Score of 720 to 759 | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,996,702 | 1,809,287 |
FICO Score of 720 to 759 | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,116,669 | 1,115,571 |
FICO Score of 720 to 759 | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 89 | 92 |
FICO Score of 720 to 759 | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 7,402 | 8,587 |
FICO Score of 720 to 759 | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,041,861 | 952,532 |
FICO Score of 720 to 759 | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 749,367 | 724,831 |
FICO Score of 720 to 759 | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 534,160 | 480,900 |
FICO Score of 720 to 759 | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 319,806 | 332,508 |
FICO Score of 720 to 759 | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 193,645 | 178,876 |
FICO Score of 720 to 759 | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 215,346 | 183,527 |
FICO Score of 720 to 759 | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 25,554 | 30,526 |
FICO Score of 720 to 759 | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,038 | 4,760 |
FICO Score of 720 to 759 | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 6,563 | 8,600 |
FICO Score of 720 to 759 | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 14,540 | 19,119 |
FICO Score Equal to or Greater than 760 | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 5,008,667 | 4,559,287 |
FICO Score Equal to or Greater than 760 | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 2,633,084 | 2,812,563 |
FICO Score Equal to or Greater than 760 | LTV not applicable | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 308 | 588 |
FICO Score Equal to or Greater than 760 | LTV not applicable | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 13,709 | 17,499 |
FICO Score Equal to or Greater than 760 | LTV less than or equal to 70% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 3,248,228 | 3,019,514 |
FICO Score Equal to or Greater than 760 | LTV less than or equal to 70% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,830,019 | 1,917,373 |
FICO Score Equal to or Greater than 760 | LTV of 70.01% to 80% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 1,191,487 | 1,066,919 |
FICO Score Equal to or Greater than 760 | LTV of 70.01% to 90% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 701,053 | 768,905 |
FICO Score Equal to or Greater than 760 | LTV of 80.01% to 90% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 321,021 | 263,541 |
FICO Score Equal to or Greater than 760 | LTV of 90.01% to 100% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 229,639 | 187,713 |
FICO Score Equal to or Greater than 760 | LTV of 90.01% to 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | 56,261 | 73,573 |
FICO Score Equal to or Greater than 760 | LTV of 100.01% to 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 6,924 | 8,418 |
FICO Score Equal to or Greater than 760 | LTV greater than 110% | Residential Mortgages | ||
Loans Receivable [Line Items] | ||
Financing receivables | 11,060 | 12,594 |
FICO Score Equal to or Greater than 760 | LTV greater than 110% | Home Equity Loans and Lines of Credit | ||
Loans Receivable [Line Items] | ||
Financing receivables | $ 32,042 | $ 35,213 |
LOANS AND ALLOWANCE FOR CREDIT LOSSES (Troubled Debt Restructuring Activity) (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018
USD ($)
contract
|
Jun. 30, 2017
USD ($)
contract
|
Jun. 30, 2018
USD ($)
contract
|
Jun. 30, 2017
USD ($)
contract
|
Dec. 31, 2017
USD ($)
|
|
Financing Receivable, Modifications [Line Items] | |||||
Troubled debt restructurings | $ 6,613,306 | $ 6,613,306 | $ 6,807,172 | ||
Number of Contracts | contract | 47,156 | 49,740 | 85,653 | 105,456 | |
Pre-TDR Recorded Investment | $ 744,787 | $ 953,219 | $ 1,385,183 | $ 1,924,787 | |
Post-TDR Recorded Investment | $ 742,641 | $ 924,563 | $ 1,380,008 | $ 1,895,310 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 8,933 | 12,081 | 23,405 | 25,410 | |
Recorded Investment | $ 152,103 | $ 208,219 | $ 368,248 | $ 431,644 | |
Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (588) | (15,054) | (1,220) | (15,999) | |
Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (1,735) | 127 | (1,735) | 260 | |
Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 1,313 | (13,482) | 1,283 | (13,481) | |
Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (1,136) | $ (247) | $ (3,503) | $ (257) | |
Commercial | CRE | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 24 | 31 | 51 | 55 | |
Pre-TDR Recorded Investment | $ 12,384 | $ 129,322 | $ 46,892 | $ 159,323 | |
Post-TDR Recorded Investment | $ 11,380 | $ 101,029 | $ 44,746 | $ 131,369 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 2 | 3 | 4 | 5 | |
Recorded Investment | $ 309 | $ 217 | $ 593 | $ 439 | |
Commercial | CRE | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 347 | (14,269) | 336 | (14,271) | |
Commercial | CRE | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (1,771) | 127 | (1,771) | 127 | |
Commercial | CRE | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 1,313 | (13,482) | 1,283 | (13,481) | |
Commercial | CRE | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (893) | $ (669) | $ (1,994) | $ (329) | |
Commercial | Commercial and industrial | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 68 | 145 | 149 | 387 | |
Pre-TDR Recorded Investment | $ 2,111 | $ 4,373 | $ 5,895 | $ 12,407 | |
Post-TDR Recorded Investment | $ 2,108 | $ 4,366 | $ 5,758 | $ 12,396 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 42 | 45 | 94 | 102 | |
Recorded Investment | $ 1,275 | $ 1,699 | $ 2,795 | $ 3,632 | |
Commercial | Commercial and industrial | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (1) | (3) | (4) | (7) | |
Commercial | Commercial and industrial | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Commercial | Commercial and industrial | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Commercial | Commercial and industrial | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (2) | $ (4) | $ (133) | $ (4) | |
Consumer | Residential mortgages | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 54 | 60 | 115 | 149 | |
Pre-TDR Recorded Investment | $ 8,403 | $ 12,981 | $ 18,330 | $ 28,974 | |
Post-TDR Recorded Investment | $ 8,394 | $ 13,103 | $ 17,601 | $ 28,913 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 32 | 67 | 96 | 120 | |
Recorded Investment | $ 3,967 | $ 10,306 | $ 12,835 | $ 15,065 | |
Consumer | Residential mortgages | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 6 | 0 | 6 | |
Consumer | Residential mortgages | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 133 | |
Consumer | Residential mortgages | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Residential mortgages | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (9) | $ 116 | $ (729) | $ (200) | |
Consumer | Home equity loans and lines of credit | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 44 | 17 | 138 | 36 | |
Pre-TDR Recorded Investment | $ 2,840 | $ 1,411 | $ 8,944 | $ 2,843 | |
Post-TDR Recorded Investment | $ 2,865 | $ 1,828 | $ 8,737 | $ 3,381 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 13 | 2 | 20 | 4 | |
Recorded Investment | $ 608 | $ 37 | $ 1,159 | $ 210 | |
Consumer | Home equity loans and lines of credit | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 13 | 0 | 13 | 0 | |
Consumer | Home equity loans and lines of credit | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 36 | 0 | 36 | 0 | |
Consumer | Home equity loans and lines of credit | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Home equity loans and lines of credit | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (24) | $ 417 | $ (256) | $ 538 | |
Consumer | Retail installment contracts and auto loans | |||||
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 8,786 | 10,940 | 20,808 | 23,221 | |
Recorded Investment | $ 145,373 | $ 193,280 | $ 347,042 | $ 407,282 | |
Consumer | Retail installment contracts and auto loans, originated | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 41,833 | 45,843 | 74,783 | 96,753 | |
Pre-TDR Recorded Investment | $ 704,222 | $ 797,572 | $ 1,271,621 | $ 1,704,171 | |
Post-TDR Recorded Investment | 703,294 | 796,745 | 1,270,052 | 1,702,303 | |
Consumer | Retail installment contracts and auto loans, originated | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (920) | (787) | (1,489) | (1,721) | |
Consumer | Retail installment contracts and auto loans, originated | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Retail installment contracts and auto loans, originated | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Retail installment contracts and auto loans, originated | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (8) | $ (40) | $ (80) | $ (147) | |
Consumer | Retail installment contracts and auto loans, purchased | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 1,223 | 24 | 2,842 | 79 | |
Pre-TDR Recorded Investment | $ 7,915 | $ 101 | $ 20,239 | $ 390 | |
Post-TDR Recorded Investment | 7,888 | 100 | 20,141 | 382 | |
Consumer | Retail installment contracts and auto loans, purchased | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (27) | (1) | (76) | (6) | |
Consumer | Retail installment contracts and auto loans, purchased | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Retail installment contracts and auto loans, purchased | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Retail installment contracts and auto loans, purchased | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ 0 | $ 0 | $ (22) | $ (2) | |
Consumer | Personal unsecured loans | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 3,906 | 3,572 | 7,568 | 7,890 | |
Pre-TDR Recorded Investment | $ 6,697 | $ 6,038 | $ 13,038 | $ 13,140 | |
Post-TDR Recorded Investment | $ 6,498 | $ 5,970 | $ 12,754 | $ 13,027 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 57 | 1,013 | 2,381 | 1,936 | |
Recorded Investment | $ 566 | $ 2,522 | $ 3,809 | $ 4,740 | |
Consumer | Personal unsecured loans | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Personal unsecured loans | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Personal unsecured loans | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Personal unsecured loans | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | $ (199) | $ (68) | $ (284) | $ (113) | |
Consumer | Other consumer | |||||
Financing Receivable, Modifications [Line Items] | |||||
Number of Contracts | contract | 4 | 48 | 7 | 107 | |
Pre-TDR Recorded Investment | $ 215 | $ 1,421 | $ 224 | $ 3,539 | |
Post-TDR Recorded Investment | $ 214 | $ 1,422 | $ 219 | $ 3,539 | |
TDRs which Subsequently Defaulted | |||||
Number of Contracts | contract | 1 | 11 | 2 | 22 | |
Recorded Investment | $ 5 | $ 158 | $ 15 | $ 276 | |
Consumer | Other consumer | Term Extension | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Other consumer | Rate Reduction | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Other consumer | Principal Forbearance | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | 0 | 0 | 0 | 0 | |
Consumer | Other consumer | Other | |||||
Financing Receivable, Modifications [Line Items] | |||||
Restructuring Modifications | (1) | $ 1 | (5) | $ 0 | |
Performing | |||||
Financing Receivable, Modifications [Line Items] | |||||
Troubled debt restructurings | 5,809,300 | 5,809,300 | 5,824,304 | ||
Non-performing | |||||
Financing Receivable, Modifications [Line Items] | |||||
Troubled debt restructurings | $ 804,006 | $ 804,006 | $ 982,868 |
OPERATING LEASE ASSETS, NET (Components of Leased Vehicles, Net) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
||||
---|---|---|---|---|---|---|
Operating Leased Assets [Line Items] | ||||||
Less: accumulated depreciation | $ (3,100,000) | $ (3,400,000) | ||||
Total operating lease assets, net | [1],[2] | 11,834,222 | 10,474,308 | |||
Vehicles | ||||||
Operating Leased Assets [Line Items] | ||||||
Operating leases | 15,885,554 | 14,751,568 | ||||
Origination fees and other costs | 45,685 | 27,246 | ||||
Manufacturer subvention payments | (1,152,531) | (1,047,113) | ||||
Leased vehicles, gross | 14,778,708 | 13,731,701 | ||||
Less: accumulated depreciation | (3,051,322) | (3,333,125) | ||||
Total operating lease assets, net | 11,727,386 | 10,398,576 | ||||
Commercial Equipment Vehicles and Aircraft | ||||||
Operating Leased Assets [Line Items] | ||||||
Operating leases | 133,142 | 93,981 | ||||
Less: accumulated depreciation | (26,306) | (18,249) | ||||
Total operating lease assets, net | $ 106,836 | $ 75,732 | ||||
|
OPERATING LEASE ASSETS, NET (Future Minimum Rental Receivables) (Details) $ in Thousands |
Jun. 30, 2018
USD ($)
|
---|---|
Leases [Abstract] | |
2018 | $ 1,065,036 |
2019 | 1,676,115 |
2020 | 991,768 |
2021 | 175,753 |
2022 | 10,655 |
Thereafter | 16,679 |
Total | $ 3,936,006 |
OPERATING LEASE ASSETS, NET (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Leases [Abstract] | ||||
Lease income | $ 569,306 | $ 489,043 | $ 1,110,202 | $ 985,087 |
Lease expense | 436,795 | 369,240 | 861,061 | 728,032 |
Operating Leased Assets [Line Items] | ||||
Net gain on sale of operating leases | 65,742 | 118,941 | ||
Operating lease assets returned to the Company at end of lease term | ||||
Operating Leased Assets [Line Items] | ||||
Net gain on sale of operating leases | $ 65,700 | $ 39,800 | $ 118,900 | $ 62,500 |
VIEs (Assets and Liabilities of VIEs) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Assets | ||||||||||||||||
Restricted cash | $ 3,123,208 | [1] | $ 3,818,807 | [1] | $ 3,300,000 | $ 3,000,000 | ||||||||||
Loans | [2] | 1,559,799 | 2,522,486 | |||||||||||||
Operating lease assets, net | [1],[3] | 11,834,222 | 10,474,308 | |||||||||||||
Various other assets | 3,930,251 | [1],[4] | $ 3,628,835 | 3,632,427 | [1],[4] | |||||||||||
TOTAL ASSETS | 130,138,694 | 128,295,952 | 128,294,030 | $ 134,755,695 | ||||||||||||
Liabilities | ||||||||||||||||
Various other liabilities | 1,085,133 | [1] | 798,025 | 799,403 | [1] | |||||||||||
TOTAL LIABILITIES | 105,986,215 | $ 104,587,021 | 104,588,399 | |||||||||||||
VIEs, Primary Beneficiary | ||||||||||||||||
Assets | ||||||||||||||||
Restricted cash | 1,657,399 | 1,995,557 | ||||||||||||||
Loans | 23,095,829 | 22,712,864 | ||||||||||||||
Operating lease assets, net | 11,729,482 | 10,160,327 | ||||||||||||||
Various other assets | 701,267 | 733,123 | ||||||||||||||
TOTAL ASSETS | 37,183,977 | 35,601,871 | ||||||||||||||
Liabilities | ||||||||||||||||
Notes payable | 29,515,015 | 28,469,999 | ||||||||||||||
Various other liabilities | 221,065 | 197,969 | ||||||||||||||
TOTAL LIABILITIES | 29,736,080 | 28,667,968 | ||||||||||||||
VIEs, Primary Beneficiary | RICs held for sale | ||||||||||||||||
Assets | ||||||||||||||||
RICs held for sale | $ 63,900 | $ 1,100,000 | ||||||||||||||
|
VIEs (Narrative) (Details) - USD ($) |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
VIE, Not Primary Beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Sales of receivables securitization | $ 1,200,000,000 | $ 500,000,000 | $ 2,600,000,000 | $ 1,200,000,000 | |
Gain (loss) on retail installment contracts | (3,200,000) | $ (3,500,000) | (20,100,000) | $ (6,200,000) | |
VIE, maximum exposure to loss | 0 | 0 | |||
Trusts | VIE, Not Primary Beneficiary | |||||
Variable Interest Entity [Line Items] | |||||
Gross retail installment contracts transferred to consolidated Trusts | $ 26,300,000,000 | 26,300,000,000 | $ 26,100,000,000 | ||
Off-balance Securitization Trusts | |||||
Variable Interest Entity [Line Items] | |||||
Proceeds from securitization of retail installment contracts | $ 4,900,000,000 | $ 3,400,000,000 |
VIEs (Cash Flow Summary) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
VIE, Primary Beneficiary | Trusts | ||||
Variable Interest Entity [Line Items] | ||||
Assets securitized | $ 6,511,953 | $ 4,750,103 | $ 13,752,897 | $ 12,396,728 |
Net proceeds from new securitizations | 4,581,874 | 3,485,091 | 8,058,196 | 9,061,892 |
Net proceeds from sale of retained bonds | 382,022 | 157,763 | 593,632 | 273,733 |
Cash received for servicing fees | 213,900 | 215,994 | 429,690 | 424,917 |
Net distributions from Trusts | 780,834 | 729,557 | 1,325,986 | 1,407,786 |
Total cash received from Trusts | 5,958,630 | 4,588,405 | 10,407,504 | 11,168,328 |
VIE, Not Primary Beneficiary | Off-balance Securitization Trusts | ||||
Variable Interest Entity [Line Items] | ||||
Assets securitized | 1,156,060 | 536,309 | 2,631,313 | 1,236,331 |
Net proceeds from new securitizations | 1,160,119 | 538,478 | 2,634,919 | 1,240,797 |
Cash received for servicing fees | 12,616 | 11,970 | 20,694 | 13,368 |
Total cash received from Trusts | $ 1,172,735 | $ 550,448 | $ 2,655,613 | $ 1,254,165 |
VIEs (Off-balance Sheet Portfolio) (Details) - VIE, Not Primary Beneficiary - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Variable Interest Entity [Line Items] | ||
Total serviced for other portfolio | $ 4,927,722 | $ 3,428,248 |
Chrysler Capital securitizations | ||
Variable Interest Entity [Line Items] | ||
Total serviced for other portfolio | 960,057 | 1,404,232 |
Third parties | ||
Variable Interest Entity [Line Items] | ||
Total serviced for other portfolio | 960,057 | 1,404,232 |
SC | ||
Variable Interest Entity [Line Items] | ||
Total serviced for other portfolio | $ 3,967,665 | $ 2,024,016 |
GOODWILL AND OTHER INTANGIBLES (Goodwill) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Goodwill [Line Items] | ||
Goodwill | $ 4,444,389 | $ 4,444,389 |
Consumer and Business Banking | ||
Goodwill [Line Items] | ||
Goodwill | 1,880,304 | |
Commercial Banking | ||
Goodwill [Line Items] | ||
Goodwill | 1,412,995 | |
CIB | ||
Goodwill [Line Items] | ||
Goodwill | 131,130 | |
SC | ||
Goodwill [Line Items] | ||
Goodwill | $ 1,019,960 |
GOODWILL AND OTHER INTANGIBLES (Goodwill) (Narrative) (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Jun. 30, 2018 |
|
Goodwill [Line Items] | ||
Goodwill | $ 4,444,389,000 | $ 4,444,389,000 |
Impairment of goodwill | 0 | |
Commercial Banking | ||
Goodwill [Line Items] | ||
Goodwill | 542,600,000 | |
CRE | ||
Goodwill [Line Items] | ||
Goodwill | $ 870,400,000 | |
Santander BanCorp | ||
Goodwill [Line Items] | ||
Impairment of goodwill | $ 10,500,000 |
GOODWILL AND OTHER INTANGIBLES (Finite-lived Intangibles) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 505,194 | $ 535,753 |
Accumulated Amortization | (300,891) | (270,460) |
Dealer networks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 406,804 | 426,411 |
Accumulated Amortization | (173,196) | (153,589) |
Chrysler relationship | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 72,500 | 80,000 |
Accumulated Amortization | (66,250) | (58,750) |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 15,300 | 15,900 |
Accumulated Amortization | (2,700) | (2,100) |
Other intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | 10,590 | 13,442 |
Accumulated Amortization | $ (58,745) | $ (56,021) |
GOODWILL AND OTHER INTANGIBLES (Other Intangible Assets) (Narrative) (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Intangibles not subject to amortization | $ 0 | $ 0 | $ 0 | ||
Amortization of intangibles | $ 15,288,000 | $ 15,424,000 | $ 30,576,000 | $ 30,915,000 |
GOODWILL AND OTHER INTANGIBLES (Future Amortization Expense) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Remaining Amount To Record | ||||
2018, Calendar Year Amount | $ 60,649 | $ 60,649 | ||
2018, Recorded To Date | 15,288 | $ 15,424 | 30,576 | $ 30,915 |
2018, Remaining Amount To Record | 30,073 | 30,073 | ||
2019 | 58,978 | 58,978 | ||
2020 | 58,645 | 58,645 | ||
2021 | 39,892 | 39,892 | ||
2022 | 39,892 | 39,892 | ||
Thereafter | $ 277,714 | $ 277,714 |
OTHER ASSETS (Other Assets Schedule) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Jan. 01, 2018 |
Dec. 31, 2017 |
||||||
---|---|---|---|---|---|---|---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||
Income tax receivables | $ 301,206 | $ 292,220 | |||||||
Derivative assets at fair value | 645,608 | 448,977 | |||||||
Other repossessed assets | 148,641 | 212,882 | |||||||
MSRs | 161,294 | 149,197 | |||||||
Prepaid expenses | 156,800 | 172,547 | |||||||
OREO | 118,503 | 130,777 | |||||||
Deferred tax asset, net | 761,171 | 771,652 | |||||||
Accrued interest receivable | 535,773 | 563,607 | |||||||
Equity method investments | 204,116 | 194,434 | |||||||
Miscellaneous assets and receivables | 897,139 | 696,134 | |||||||
Total other assets | $ 3,930,251 | [1],[2] | $ 3,628,835 | $ 3,632,427 | [1],[2] | ||||
|
OTHER ASSETS (MSRs) (Details) - Residential MSRs - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
|
Servicing Assets at Fair Value [Line Items] | ||||||||
Principal balance of loans serviced for others | $ 14,600,000 | $ 14,600,000 | $ 14,900,000 | |||||
MSRs | 158,470 | $ 146,091 | 158,470 | $ 146,091 | $ 160,130 | $ 145,993 | $ 149,455 | $ 146,589 |
Net changes in the fair value of MSRs | $ (1,300) | $ (1,200) | $ 13,800 | $ 300 |
OTHER ASSETS (Servicing Assets Rollforward) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Servicing Asset at Amortized Value, Balance [Roll Forward] | |||||
MSRs | $ 161,294 | $ 161,294 | $ 149,197 | ||
Residential MSRs | |||||
Servicing Asset at Amortized Value, Balance [Roll Forward] | |||||
Fair value at beginning of period | 160,130 | $ 149,455 | 145,993 | $ 146,589 | |
Mortgage servicing assets recognized | 2,841 | 2,866 | 5,597 | 8,597 | |
Principal reductions | (3,227) | (5,037) | (6,889) | (9,358) | |
Change in fair value due to valuation assumptions | (1,274) | (1,193) | 13,769 | 263 | |
Fair value at end of period | 158,470 | $ 146,091 | 158,470 | $ 146,091 | |
MSRs | $ 161,300 | $ 161,300 | $ 149,200 |
DEPOSITS AND OTHER CUSTOMER ACCOUNTS (Summary of Deposits and Other Customer Accounts) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Balance | ||
Interest-bearing demand deposits | $ 8,439,484 | $ 8,784,597 |
Non-interest-bearing demand deposits | 15,430,518 | 15,402,235 |
Savings | 5,914,126 | 5,903,897 |
Customer repurchase accounts | 580,451 | 802,119 |
Money market | 25,392,936 | 24,530,661 |
CDs | 5,799,033 | 5,407,594 |
Total Deposits | 61,556,548 | 60,831,103 |
Foreign deposits | $ 8,600,000 | $ 9,100,000 |
Percent of total deposits | ||
Interest-bearing demand deposits (as a percent) | 13.70% | 14.40% |
Non-interest-bearing demand deposits (as a percent) | 25.10% | 25.30% |
Savings (as a percent) | 9.60% | 9.70% |
Customer repurchase accounts (as a percent) | 0.90% | 1.40% |
Money market (as a percent) | 41.30% | 40.30% |
CDs (as a percent) | 9.40% | 8.90% |
Total Deposits (as a percent) | 100.00% | 100.00% |
DEPOSITS AND OTHER CUSTOMER ACCOUNTS (Narrative) (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | $ 6,200.0 | $ 5,900.0 |
Demand deposit overdrafts that have been reclassified as loan balances | 107.6 | 38.9 |
CD in denominations greater than $250,000 | 1,600.0 | 1,300.0 |
Public fund deposits | ||
Financial Instruments Owned and Pledged as Collateral [Line Items] | ||
Securities pledged as collateral, fair value | $ 2,300.0 | $ 2,300.0 |
BORROWINGS (Narrative) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
||
---|---|---|---|---|
Debt Disclosure [Abstract] | ||||
Total borrowings and other debt obligations | [1] | $ 38,771,378 | $ 39,003,313 | |
|
BORROWINGS (Bank) (Narrative) (Details) |
Jun. 30, 2018
USD ($)
|
---|---|
Bank | |
Debt Instrument [Line Items] | |
Debt repurchased | $ 0 |
BORROWINGS (SHUSA) (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jul. 02, 2018 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Mar. 31, 2018 |
|
Debt Instrument [Line Items] | ||||||
Loss on debt extinguishment | $ 1,201 | $ 3,991 | $ 3,413 | $ 10,740 | ||
Cash payment of debt | $ 22,560,831 | $ 26,829,907 | ||||
Senior Notes | 3.45% senior notes, due August 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Debt repurchased | $ 63,200 | |||||
Stated interest rate | 3.45% | 3.45% | 3.45% | |||
Senior Notes | 2.70% senior notes, due May 2019 | ||||||
Debt Instrument [Line Items] | ||||||
Debt repurchased | $ 336,800 | |||||
Stated interest rate | 2.70% | 2.70% | 2.70% | |||
Senior Notes | 2.70% senior notes, due May 2019 | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate | 2.70% | |||||
Debt amount | $ 663,200 | |||||
Cash payment of debt | $ 484,500 | |||||
Senior Notes | Senior floating rate notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt amount | $ 427,900 | $ 427,900 | ||||
Senior Notes | Senior floating rate notes | 3-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on LIBOR (as a percent) | 1.00% |
BORROWINGS (Parent Company and Other IHC Entities) (Details) - USD ($) $ in Thousands |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
|||
Debt Instrument [Line Items] | |||||
Total borrowings and other debt obligations | [1] | $ 38,771,378 | $ 39,003,313 | ||
Subsidiaries | 2.00% subordinated debt, maturing through 2042 | |||||
Debt Instrument [Line Items] | |||||
Subordinated debt, Balance | $ 40,761 | $ 40,842 | |||
Effective Rate | 2.00% | 2.00% | |||
Stated interest rate | 2.00% | ||||
Subsidiaries | Short-term borrowings, due within one year, maturing July 2018 | |||||
Debt Instrument [Line Items] | |||||
Short-term borrowings, Balance | $ 4,857 | $ 24,000 | |||
Effective Rate | 0.67% | 1.38% | |||
Subsidiaries | Total due to others overnight, due within one year, due July 2018 | |||||
Debt Instrument [Line Items] | |||||
Short-term borrowings, Balance | $ 23,600 | $ 10,000 | |||
Effective Rate | 1.90% | 1.38% | |||
Subsidiaries | Short-term borrowings, due within one year, maturing July 2018 | |||||
Debt Instrument [Line Items] | |||||
Short-term borrowings, Balance | $ 21,357 | $ 37,546 | |||
Effective Rate | 0.25% | 0.25% | |||
Subsidiaries | Short-term borrowings, due within one year, maturing through 2018 | |||||
Debt Instrument [Line Items] | |||||
Short-term borrowings, Balance | $ 7,123 | ||||
Effective Rate | 0.00% | 0.83% | |||
Parent Company and Other Subsidiaries | |||||
Debt Instrument [Line Items] | |||||
Total borrowings and other debt obligations | $ 8,268,453 | $ 8,269,076 | |||
Effective Rate | 3.59% | 3.45% | |||
Senior Notes | 3.45% senior notes, due August 2018 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 181,305 | $ 244,317 | |||
Effective Rate | 3.62% | 3.62% | |||
Stated interest rate | 3.45% | 3.45% | |||
Senior Notes | 2.70% senior notes, due May 2019 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 662,531 | $ 998,349 | |||
Effective Rate | 2.82% | 2.82% | |||
Stated interest rate | 2.70% | 2.70% | |||
Senior Notes | 2.65% senior notes, due April 2020 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 997,037 | $ 996,238 | |||
Effective Rate | 2.82% | 2.82% | |||
Stated interest rate | 2.65% | ||||
Senior Notes | 3.70% senior notes, due March 2022 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 1,440,053 | $ 1,440,044 | |||
Effective Rate | 3.74% | 3.74% | |||
Stated interest rate | 3.70% | ||||
Senior Notes | 3.40% senior notes, due January 2023 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 994,241 | $ 993,662 | |||
Effective Rate | 3.54% | 3.54% | |||
Stated interest rate | 3.40% | ||||
Senior Notes | 4.50% senior notes, due July 2025 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 1,095,705 | $ 1,095,449 | |||
Effective Rate | 4.56% | 4.56% | |||
Stated interest rate | 4.50% | ||||
Senior Notes | 4.40% senior notes, due July 2027 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 1,049,793 | $ 1,049,787 | |||
Effective Rate | 4.40% | 4.40% | |||
Stated interest rate | 4.40% | ||||
Senior Notes | Junior subordinated debentures - Sovereign Capital Trust IX, due July 2036 | |||||
Debt Instrument [Line Items] | |||||
Subordinated debt, Balance | $ 149,477 | $ 149,462 | |||
Effective Rate | 4.13% | 3.14% | |||
Senior Notes | Common securities - Sovereign Capital Trust IX | |||||
Debt Instrument [Line Items] | |||||
Common securities, Balance | $ 4,640 | $ 4,640 | |||
Effective Rate | 4.13% | 3.14% | |||
Senior Notes | Senior notes, due July 2019 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 388,698 | $ 388,565 | |||
Effective Rate | 2.98% | 2.31% | |||
Senior Notes | Senior notes, due July 2019 | 3-month LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on LIBOR (as a percent) | 1.00% | ||||
Senior Notes | Senior notes, due September 2019 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 370,923 | $ 370,754 | |||
Effective Rate | 2.89% | 2.34% | |||
Senior Notes | Senior notes, due January 2020 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 302,607 | $ 302,494 | |||
Effective Rate | 2.98% | 2.40% | |||
Senior Notes | Senior notes, due September 2020 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 113,030 | $ 115,804 | |||
Effective Rate | 3.27% | 3.32% | |||
Senior Notes | Senior notes, due September 2020 | 3-month LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on LIBOR (as a percent) | 1.05% | ||||
Senior Notes | Senior notes, due June 2022 | |||||
Debt Instrument [Line Items] | |||||
Senior notes, Balance | $ 427,838 | $ 0 | |||
Effective Rate | 3.67% | 0.00% | |||
|
BORROWINGS (Santander Bank) (Details) - SBNA - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Debt Instrument [Line Items] | ||
Total borrowings and other debt obligations | $ 1,577,001 | $ 2,575,980 |
Effective Rate | 3.81% | 3.07% |
8.750% subordinated debentures, due May 2018 | ||
Debt Instrument [Line Items] | ||
Subordinated debt, Balance | $ 0 | $ 192,019 |
Effective Rate | 0.00% | 8.92% |
Stated interest rate | 8.75% | |
Subordinated term loan, due February 2019 | ||
Debt Instrument [Line Items] | ||
Subordinated term loan, Balance | $ 104,912 | $ 111,883 |
Effective Rate | 7.63% | 7.12% |
FHLB advances, maturing through July 2019 | ||
Debt Instrument [Line Items] | ||
FHLB advances, Balance | $ 1,300,000 | $ 1,950,000 |
Effective Rate | 2.34% | 1.53% |
Securities sold under repurchase agreements | ||
Debt Instrument [Line Items] | ||
Securities sold under repurchase agreements, Balance | $ 0 | $ 150,000 |
Effective Rate | 0.00% | 1.56% |
Real estate investment trust preferred, due May 2020 | ||
Debt Instrument [Line Items] | ||
REIT preferred | $ 144,877 | $ 144,167 |
Effective Rate | 13.21% | 13.35% |
Subordinated term loan, due August 2022 | ||
Debt Instrument [Line Items] | ||
Subordinated term loan, Balance | $ 27,212 | $ 27,911 |
Effective Rate | 9.29% | 8.89% |
FHLB advances | ||
Debt Instrument [Line Items] | ||
Letters of credit | $ 560,500 |
BORROWINGS (SC) (Details) - USD ($) |
1 Months Ended | 6 Months Ended | |
---|---|---|---|
Jul. 31, 2018 |
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | $ 84,600,000 | $ 90,900,000 | |
SC | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 52,821,071,000 | 49,078,924,000 | |
Restricted Cash Pledged | 1,615,267,000 | 1,847,759,000 | |
Private issuances of notes backed by vehicle leases | $ 6,000,000,000 | $ 3,700,000,000 | |
SC | Maximum | |||
Debt Instrument [Line Items] | |||
Effective Rate | 3.53% | 4.09% | |
SC | Repurchase facility, maturing on various dates | Subsequent Event | |||
Debt Instrument [Line Items] | |||
Percentage of line of credit that matured and settled | 38.00% | ||
SC | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | $ 4,625,023,000 | $ 5,598,316,000 | |
Committed Amount | $ 12,156,090,000 | $ 12,444,483,000 | |
Effective Rate | 3.76% | 2.73% | |
Assets Pledged | $ 6,279,384,000 | $ 6,703,767,000 | |
Restricted Cash Pledged | $ 60,155,000 | 132,024,000 | |
SC | Revolving Credit Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Facility rolling maturity period | 1 year | ||
SC | Revolving Credit Facility | Warehouse line, maturing on various dates | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | $ 518,345,000 | 339,145,000 | |
Committed Amount | $ 1,250,000,000 | $ 1,250,000,000 | |
Effective Rate | 3.36% | 2.53% | |
Assets Pledged | $ 780,594,000 | $ 461,353,000 | |
Restricted Cash Pledged | 5,068,000 | 12,645,000 | |
SC | Revolving Credit Facility | Warehouse line, due November 2019 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 78,620,000 | 435,220,000 | |
Committed Amount | $ 500,000,000 | $ 500,000,000 | |
Effective Rate | 5.06% | 1.92% | |
Assets Pledged | $ 89,182,000 | $ 521,365,000 | |
Restricted Cash Pledged | 411,000 | 16,866,000 | |
SC | Revolving Credit Facility | Warehouse line, due August 2019 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 1,832,943,000 | 2,044,843,000 | |
Committed Amount | $ 3,900,000,000 | $ 3,900,000,000 | |
Effective Rate | 3.86% | 2.96% | |
Assets Pledged | $ 2,310,677,000 | $ 2,929,890,000 | |
Restricted Cash Pledged | 10,261,000 | 53,639,000 | |
SC | Revolving Credit Facility | Warehouse line, due October 2019 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 364,777,000 | 226,577,000 | |
Committed Amount | $ 1,800,000,000 | $ 1,800,000,000 | |
Effective Rate | 4.44% | 4.95% | |
Assets Pledged | $ 529,183,000 | $ 311,336,000 | |
Restricted Cash Pledged | 180,000 | 6,772,000 | |
SC | Revolving Credit Facility | Warehouse line, due October 2019 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 217,465,000 | 81,865,000 | |
Committed Amount | $ 400,000,000 | $ 400,000,000 | |
Effective Rate | 3.45% | 4.09% | |
Assets Pledged | $ 328,840,000 | $ 114,021,000 | |
Restricted Cash Pledged | 158,000 | 3,057,000 | |
SC | Revolving Credit Facility | Warehouse line, due August 2019 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 287,484,000 | ||
Committed Amount | $ 500,000,000 | ||
Effective Rate | 3.56% | ||
Assets Pledged | $ 410,567,000 | ||
Restricted Cash Pledged | 24,525,000 | ||
SC | Revolving Credit Facility | Warehouse line, due November 2020 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 417,499,000 | 403,999,000 | |
Committed Amount | $ 1,000,000,000 | $ 1,000,000,000 | |
Effective Rate | 3.17% | 2.66% | |
Assets Pledged | $ 632,984,000 | $ 546,782,000 | |
Restricted Cash Pledged | 8,000 | 14,729,000 | |
SC | Revolving Credit Facility | Warehouse line, due October 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 214,500,000 | 235,700,000 | |
Committed Amount | $ 300,000,000 | $ 300,000,000 | |
Effective Rate | 3.66% | 2.84% | |
Assets Pledged | $ 248,608,000 | $ 289,634,000 | |
Restricted Cash Pledged | 333,000 | 10,474,000 | |
SC | Revolving Credit Facility | Warehouse line, due December 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 115,100,000 | 0 | |
Committed Amount | $ 300,000,000 | $ 300,000,000 | |
Effective Rate | 4.01% | 1.49% | |
Assets Pledged | $ 181,621,000 | $ 0 | |
Restricted Cash Pledged | 855,000 | 0 | |
SC | Revolving Credit Facility | Warehouse line, due January 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 336,484,000 | ||
Committed Amount | $ 500,000,000 | ||
Effective Rate | 2.87% | ||
Assets Pledged | $ 473,208,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Repurchase facility, maturing on various dates | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 179,934,000 | 325,775,000 | |
Committed Amount | $ 179,934,000 | $ 325,775,000 | |
Effective Rate | 3.78% | 3.24% | |
Assets Pledged | $ 259,860,000 | $ 474,188,000 | |
Restricted Cash Pledged | 17,818,000 | 13,842,000 | |
SC | Revolving Credit Facility | Repurchase facility, due July 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 92,167,000 | ||
Committed Amount | $ 92,167,000 | ||
Effective Rate | 3.51% | ||
Assets Pledged | $ 129,440,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Repurchase facility, due September 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 68,682,000 | ||
Committed Amount | $ 68,682,000 | ||
Effective Rate | 3.56% | ||
Assets Pledged | $ 92,358,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Repurchase facility, due December 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 115,307,000 | ||
Committed Amount | $ 115,307,000 | ||
Effective Rate | 3.58% | ||
Assets Pledged | $ 156,202,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Repurchase facility, due April 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 202,311,000 | ||
Committed Amount | $ 202,311,000 | ||
Effective Rate | 2.67% | ||
Assets Pledged | $ 264,120,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Repurchase facility, due March 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 147,500,000 | ||
Committed Amount | $ 147,500,000 | ||
Effective Rate | 3.91% | ||
Assets Pledged | $ 222,108,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Repurchase facility, due March 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 68,897,000 | ||
Committed Amount | $ 68,897,000 | ||
Effective Rate | 3.04% | ||
Assets Pledged | $ 95,762,000 | ||
Restricted Cash Pledged | 0 | ||
SC | Revolving Credit Facility | Line of credit with related party, due December 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 0 | 0 | |
Committed Amount | $ 1,000,000,000 | $ 1,000,000,000 | |
Effective Rate | 3.09% | 3.09% | |
Assets Pledged | $ 0 | $ 0 | |
Restricted Cash Pledged | 0 | 0 | |
SC | Revolving Credit Facility | Line of credit with related party, due December 2018 | |||
Debt Instrument [Line Items] | |||
Initial Note Amounts Issued | 122,200,000 | 750,000,000 | |
Committed Amount | $ 750,000,000 | $ 750,000,000 | |
Effective Rate | 4.60% | 1.33% | |
Assets Pledged | $ 129,268,000 | $ 0 | |
Restricted Cash Pledged | 538,000 | $ 0 | |
SC | Revolving Credit Facility | Line of credit with related party | |||
Debt Instrument [Line Items] | |||
Unsecured debt | $ 0 |
BORROWINGS (Secured Structured Financings) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Debt Instrument [Line Items] | ||
Initial Note Amounts Issued | $ 84,600 | $ 90,900 |
SC | ||
Debt Instrument [Line Items] | ||
Balance | 24,300,901 | 22,559,941 |
Initial Note Amounts Issued | 52,821,071 | 49,078,924 |
Collateral | 30,829,806 | 29,106,279 |
Restricted Cash | $ 1,615,267 | $ 1,847,759 |
SC | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate Range | 0.88% | 0.88% |
SC | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate Range | 3.53% | 4.09% |
SC | SC public securitizations, maturing on various dates | ||
Debt Instrument [Line Items] | ||
Balance | $ 18,596,271 | $ 14,995,304 |
Initial Note Amounts Issued | 39,882,682 | 36,800,642 |
Collateral | 23,831,801 | 19,873,621 |
Restricted Cash | $ 1,588,592 | $ 1,470,459 |
SC | SC public securitizations, maturing on various dates | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate Range | 1.16% | 0.89% |
SC | SC public securitizations, maturing on various dates | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate Range | 3.53% | 2.80% |
SC | SC privately issued amortizing notes, maturing on various dates | ||
Debt Instrument [Line Items] | ||
Balance | $ 5,704,630 | $ 7,564,637 |
Initial Note Amounts Issued | 12,938,389 | 12,278,282 |
Collateral | 6,998,005 | 9,232,658 |
Restricted Cash | $ 26,675 | $ 377,300 |
SC | SC privately issued amortizing notes, maturing on various dates | Minimum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate Range | 0.88% | 0.88% |
SC | SC privately issued amortizing notes, maturing on various dates | Maximum | ||
Debt Instrument [Line Items] | ||
Initial Weighted Average Interest Rate Range | 2.89% | 4.09% |
ACCUMULATED OTHER COMPREHENSIVE INCOME / (LOSS) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total other comprehensive income/(loss), pretax activity | $ (52,399) | $ 32,399 | $ (186,286) | $ 64,319 |
Total other comprehensive income/(loss), tax effect | 13,231 | (9,971) | 14,362 | (22,924) |
TOTAL OTHER COMPREHENSIVE (LOSS) / GAIN, NET OF TAX | (39,168) | 22,428 | (171,924) | 41,395 |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Equity, Beginning balance | 23,705,631 | 22,378,758 | ||
Net Activity | (39,168) | 22,428 | (171,924) | 41,395 |
Net Activity, upon adoption | (211,018) | |||
Equity, Ending balance | 24,152,479 | 22,897,254 | 24,152,479 | 22,897,254 |
Net unrealized (losses) on cash flow hedge derivative financial instruments | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Other comprehensive income/(loss), pretax activity | (21,956) | 10,205 | (33,417) | 12,151 |
Other comprehensive income/(loss), tax effect | 6,772 | (596) | 2,018 | (3,430) |
Other comprehensive income/(loss), net activity | (15,184) | 9,609 | (31,399) | 8,721 |
Reclassification adjustment, pretax activity | 15,332 | (4,072) | 13,645 | (6,459) |
Reclassification adjustment, tax effect | (4,887) | 986 | (4,349) | 1,774 |
Reclassification adjustment, net activity | 10,445 | (3,086) | 9,296 | (4,685) |
Total other comprehensive income/(loss), pretax activity | (6,624) | 6,133 | (19,772) | 5,692 |
Total other comprehensive income/(loss), tax effect | 1,885 | 390 | (2,331) | (1,656) |
TOTAL OTHER COMPREHENSIVE (LOSS) / GAIN, NET OF TAX | (4,739) | 6,523 | (22,103) | 4,036 |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Equity, Beginning balance | (23,752) | (9,212) | (6,388) | (6,725) |
Net Activity | (4,739) | 6,523 | (22,103) | 4,036 |
Equity, Ending balance | (28,491) | (2,689) | (28,491) | (2,689) |
Net unrealized (losses) on investments in debt securities AFS | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Other comprehensive income/(loss), pretax activity | (46,198) | 36,480 | (168,442) | 67,928 |
Other comprehensive income/(loss), tax effect | 11,459 | (14,369) | 22,246 | (24,477) |
Other comprehensive income/(loss), net activity | (34,739) | 22,111 | (146,196) | 43,451 |
Total other comprehensive income/(loss), pretax activity | (46,617) | 25,355 | (168,198) | 56,803 |
Total other comprehensive income/(loss), tax effect | 11,563 | (10,006) | 22,214 | (20,485) |
TOTAL OTHER COMPREHENSIVE (LOSS) / GAIN, NET OF TAX | (35,054) | 15,349 | (145,984) | 36,318 |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Equity, Beginning balance | (290,522) | (109,785) | (140,498) | (130,754) |
Net Activity | (35,054) | 15,349 | (145,984) | 36,318 |
Cumulative effect of adoption of new ASUs | (39,094) | |||
Net Activity, upon adoption | (185,078) | |||
Equity, Ending balance | (325,576) | (94,436) | (325,576) | (94,436) |
Reclassification adjustment for net (gains)/losses included in net income/(expense) on non-OTTI securities | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Reclassification adjustment, pretax activity | (419) | (11,125) | 244 | (11,125) |
Reclassification adjustment, tax effect | 104 | 4,363 | (32) | 3,992 |
Reclassification adjustment, net activity | (315) | (6,762) | 212 | (7,133) |
Pension and post-retirement actuarial gains/(losses) | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total other comprehensive income/(loss), pretax activity | 842 | 911 | 1,684 | 1,824 |
Total other comprehensive income/(loss), tax effect | (217) | (355) | (5,521) | (783) |
TOTAL OTHER COMPREHENSIVE (LOSS) / GAIN, NET OF TAX | 625 | 556 | (3,837) | 1,041 |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Equity, Beginning balance | (56,007) | (55,244) | (51,545) | (55,729) |
Net Activity | 625 | 556 | (3,837) | 1,041 |
Equity, Ending balance | (55,382) | (54,688) | (55,382) | (54,688) |
Accumulated other comprehensive (loss)/income | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Equity, Beginning balance | (370,281) | (174,241) | (198,431) | (193,208) |
Equity, Ending balance | $ (409,449) | $ (151,813) | $ (409,449) | $ (151,813) |
DERIVATIVES (Narrative) (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Credit Risk Contingent Features | |||||
Fair value of derivatives with credit risk contingent feature associated with credit ratings | $ 1,500,000 | $ 1,500,000 | |||
Additional collateral required | 0 | 0 | |||
Fair value of derivatives with credit risk contingent features | 10,600,000 | 10,600,000 | $ 10,400,000 | ||
Collateral posted | 11,900,000 | 11,900,000 | $ 15,700,000 | ||
Cash Flow Hedges | |||||
Cash flow hedge gains to be reclassified within next twelve months | 41,500,000 | ||||
Net unrealized (losses) on cash flow hedge derivative financial instruments | |||||
Derivative [Line Items] | |||||
Loss recognized in Other Comprehensive Income for cash flow hedge derivatives | (15,184,000) | $ 9,609,000 | (31,399,000) | $ 8,721,000 | |
Amount reclassified from Other Comprehensive Income into earnings for cash flow hedge derivatives | $ 10,445,000 | $ (3,086,000) | $ 9,296,000 | $ (4,685,000) |
DERIVATIVES (Derivatives Designated in Hedge Relationships) (Details) - Designated as hedging instrument - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Derivative [Line Items] | ||
Notional Amount | $ 10,046,114 | $ 10,183,511 |
Asset, Total | 80,966 | 49,442 |
Liability, Total | $ 128,999 | $ 84,911 |
Weighted Average Receive Rate | 1.20% | 0.58% |
Weighted Average Pay Rate | 1.82% | 0.63% |
Weighted Average | ||
Derivative [Line Items] | ||
Weighted Average Life (Years) | 2 years 1 month 27 days | 2 years 6 months 10 days |
Cash flow hedges | Pay fixed — receive variable interest rate swaps | ||
Derivative [Line Items] | ||
Notional Amount | $ 4,446,114 | $ 5,183,511 |
Asset, Cash flow hedges | 74,833 | 46,422 |
Liability, Cash flow hedges | $ 1,794 | $ 4,458 |
Weighted Average Receive Rate | 1.44% | 0.05% |
Weighted Average Pay Rate | 2.30% | 0.14% |
Cash flow hedges | Pay fixed — receive variable interest rate swaps | Weighted Average | ||
Derivative [Line Items] | ||
Weighted Average Life (Years) | 1 year 9 months 22 days | 2 years 1 month 13 days |
Cash flow hedges | Pay variable - receive fixed interest rate swaps | ||
Derivative [Line Items] | ||
Notional Amount | $ 4,000,000 | $ 4,000,000 |
Asset, Cash flow hedges | 0 | 0 |
Liability, Cash flow hedges | $ 127,205 | $ 80,453 |
Weighted Average Receive Rate | 1.41% | 1.41% |
Weighted Average Pay Rate | 2.02% | 1.42% |
Cash flow hedges | Pay variable - receive fixed interest rate swaps | Weighted Average | ||
Derivative [Line Items] | ||
Weighted Average Life (Years) | 2 years 6 months 10 days | 3 years 7 days |
Cash flow hedges | Interest rate floor | ||
Derivative [Line Items] | ||
Notional Amount | $ 1,600,000 | $ 1,000,000 |
Asset, Cash flow hedges | 6,133 | 3,020 |
Liability, Cash flow hedges | $ 0 | $ 0 |
Weighted Average Receive Rate | 0.00% | 0.00% |
Weighted Average Pay Rate | 0.00% | 0.00% |
Cash flow hedges | Interest rate floor | Weighted Average | ||
Derivative [Line Items] | ||
Weighted Average Life (Years) | 2 years 2 months 12 days | 2 years 7 months 20 days |
DERIVATIVES (Derivatives Not Designated in Hedge Relationships) (Details) - Not designated as hedging instrument - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | $ 50,157,767 | $ 48,685,902 |
Asset derivatives Fair value | 572,439 | 413,802 |
Liability derivatives Fair value | 488,890 | 342,900 |
Other | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 967,997 | 824,786 |
Asset derivatives Fair value | 5,321 | 5,874 |
Liability derivatives Fair value | 8,024 | 5,228 |
Foreign exchange contracts | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 3,524,342 | 2,764,999 |
Asset derivatives Fair value | 50,331 | 24,932 |
Liability derivatives Fair value | 38,434 | 25,521 |
Interest rate swap agreements | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 2,625,796 | 1,749,349 |
Asset derivatives Fair value | 19,596 | 9,596 |
Liability derivatives Fair value | 1,243 | 1,631 |
Interest rate cap agreements | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 9,225,194 | 10,932,707 |
Asset derivatives Fair value | 199,053 | 135,942 |
Liability derivatives Fair value | 0 | 32,109 |
Options for interest rate cap agreements | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 9,207,853 | 10,906,081 |
Asset derivatives Fair value | 0 | 32,165 |
Liability derivatives Fair value | 199,131 | 135,824 |
Mortgage banking derivatives | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 1,014,438 | 768,046 |
Asset derivatives Fair value | 5,271 | 2,301 |
Liability derivatives Fair value | 16,423 | 2,551 |
Mortgage banking derivatives | Forward commitments to sell loans | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 406,350 | 311,852 |
Asset derivatives Fair value | 0 | 3 |
Liability derivatives Fair value | 1,209 | 459 |
Mortgage banking derivatives | Interest rate lock commitments | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 188,088 | 126,194 |
Asset derivatives Fair value | 2,384 | 2,105 |
Liability derivatives Fair value | 0 | 0 |
Mortgage banking derivatives | Mortgage servicing | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 420,000 | 330,000 |
Asset derivatives Fair value | 2,887 | 193 |
Liability derivatives Fair value | 15,214 | 2,092 |
Customer related derivatives | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 23,592,147 | 20,739,934 |
Asset derivatives Fair value | 292,867 | 202,992 |
Liability derivatives Fair value | 225,635 | 140,036 |
Customer related derivatives | Swaps receive fixed | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 10,638,573 | 9,328,079 |
Asset derivatives Fair value | 30,822 | 72,912 |
Liability derivatives Fair value | 189,772 | 70,348 |
Customer related derivatives | Swaps pay fixed | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 10,935,332 | 9,576,893 |
Asset derivatives Fair value | 247,558 | 110,109 |
Liability derivatives Fair value | 23,340 | 51,380 |
Customer related derivatives | Other | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional | 2,018,242 | 1,834,962 |
Asset derivatives Fair value | 14,487 | 19,971 |
Liability derivatives Fair value | $ 12,523 | $ 18,308 |
DERIVATIVES (Gains (Losses on All Derivatives) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Interest rate swaps | Net Interest Income | Fair value hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | $ 0 | $ (2,162) | $ 0 | $ (2,162) |
Pay fixed-receive variable interest rate swaps | Interest expense on borrowings | Cash flow hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 7,925 | (4,084) | 10,689 | (6,471) |
Pay variable receive-fixed interest rate swap | Interest income on loans | Cash flow hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | (5,023) | (3,506) | (7,043) | (6,287) |
Forward commitments to sell loans | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | (239) | 3,625 | (753) | (7,315) |
Interest rate lock commitments | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 131 | (1,414) | 279 | 580 |
Mortgage servicing | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | (3,532) | 1,503 | (10,427) | 2,000 |
Customer related derivatives | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 5,360 | (1,124) | 7,946 | (2,737) |
Foreign exchange | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 4,520 | 886 | 5,808 | 3,146 |
Interest rate swaps, caps, and options | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 193 | 4 | 10,232 | 1,511 |
Interest rate swaps, caps, and options | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 0 | (1,068) | 0 | 3,662 |
Total return settlement | Other administrative expenses | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | 0 | 0 | 0 | (505) |
Other | Miscellaneous income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized on all derivatives | $ (392) | $ 557 | $ (3,545) | $ (944) |
DERIVATIVES (Offsetting of Financial Assets) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Offsetting Assets [Line Items] | ||
Gross Amounts of Recognized Assets, Total derivatives subject to a master netting arrangement or similar arrangement | $ 651,021 | $ 461,139 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet, Total Derivative Assets | 7,739 | 6,731 |
Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheet, Total derivatives subject to a master netting arrangement or similar arrangement | 643,282 | 454,408 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Financial Instruments, Total Derivative Assets | 1,987 | 2,021 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Cash Collateral Received, Total Derivative Assets | 189,092 | 81,051 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total derivatives subject to a master netting arrangement or similar arrangement | 452,203 | 371,336 |
Total derivatives not subject to a master netting arrangement or similar arrangement | 2,384 | 2,105 |
Gross Amounts of Recognized Assets, Total Derivative Assets | 653,405 | 463,244 |
Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheet, Total Derivative Assets | 645,666 | 456,513 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet - Net Amount, Total Derivative Assets | 454,587 | 373,441 |
Other derivative activities | ||
Offsetting Assets [Line Items] | ||
Gross Amounts of Recognized Assets, Total derivatives subject to a master netting arrangement or similar arrangement | 570,055 | 411,697 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet, Total Derivative Assets | 7,739 | 6,731 |
Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheet, Total derivatives subject to a master netting arrangement or similar arrangement | 562,316 | 404,966 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Financial Instruments, Total Derivative Assets | 1,987 | 2,021 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Cash Collateral Received, Total Derivative Assets | 145,171 | 77,975 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total derivatives subject to a master netting arrangement or similar arrangement | 415,158 | 324,970 |
Cash flow hedges | ||
Offsetting Assets [Line Items] | ||
Gross Amounts of Recognized Assets, Total derivatives subject to a master netting arrangement or similar arrangement | 80,966 | 49,442 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet, Total Derivative Assets | 0 | 0 |
Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheet, Total derivatives subject to a master netting arrangement or similar arrangement | 80,966 | 49,442 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Financial Instruments, Total Derivative Assets | 0 | 0 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Cash Collateral Received, Total Derivative Assets | 43,921 | 3,076 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total derivatives subject to a master netting arrangement or similar arrangement | $ 37,045 | $ 46,366 |
DERIVATIVES (Offsetting of Financial Liabilities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Offsetting Liabilities [Line Items] | ||
Gross Amounts of Recognized Liabilities, Total derivatives subject to a master netting arrangement or similar arrangement | $ 616,680 | $ 427,663 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet | 20,187 | 16,236 |
Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet, Total derivatives subject to a master netting arrangement or similar arrangement | 596,493 | 411,427 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Financial Instruments | 0 | 0 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Cash Collateral Pledged | 353,640 | 166,338 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total derivatives subject to a master netting arrangement or similar arrangement | 242,853 | 245,089 |
Total derivatives not subject to a master netting arrangement or similar arrangement | 1,209 | 148 |
Gross Amounts of Recognized Liabilities, Total Derivative Liabilities | 617,889 | 427,811 |
Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet, Total Derivative Liabilities | 597,702 | 411,575 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total Derivatives Liabilities | 244,062 | 245,237 |
Other derivative activities | ||
Offsetting Liabilities [Line Items] | ||
Gross Amounts of Recognized Liabilities, Total derivatives subject to a master netting arrangement or similar arrangement | 487,681 | 342,752 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet | 20,187 | 16,236 |
Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet, Total derivatives subject to a master netting arrangement or similar arrangement | 467,494 | 326,516 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Financial Instruments | 0 | 0 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Cash Collateral Pledged | 353,640 | 165,716 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total derivatives subject to a master netting arrangement or similar arrangement | 113,854 | 160,800 |
Cash flow hedges | ||
Offsetting Liabilities [Line Items] | ||
Gross Amounts of Recognized Liabilities, Total derivatives subject to a master netting arrangement or similar arrangement | 128,999 | 84,911 |
Gross Amounts Offset in the Condensed Consolidated Balance Sheet | 0 | 0 |
Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheet, Total derivatives subject to a master netting arrangement or similar arrangement | 128,999 | 84,911 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Financial Instruments | 0 | 0 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Cash Collateral Pledged | 0 | 622 |
Gross Amounts Not Offset in the Condensed Consolidated Balance Sheet, Net Amount, Total derivatives subject to a master netting arrangement or similar arrangement | $ 128,999 | $ 84,289 |
INCOME TAXES (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | 36 Months Ended | 60 Months Ended | ||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2017
USD ($)
|
Dec. 31, 2009
USD ($)
transaction
|
Dec. 31, 2005
USD ($)
|
Dec. 31, 2007
USD ($)
|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
|
|
Income Tax Disclosure [Abstract] | |||||||||
Income tax provision | $ 168,035 | $ 91,983 | $ 263,356 | $ 170,920 | |||||
Effective tax rate | 31.90% | 24.20% | 29.90% | 27.50% | |||||
Income Tax Contingency [Line Items] | |||||||||
Number of financing transactions related to lawsuit | transaction | 2 | ||||||||
Transaction amount related to lawsuit seeking refund of taxes paid | $ 1,200,000 | ||||||||
Disallowed interest expense and transaction costs deductions | 74,600 | ||||||||
Penalties and interest expense | $ 92,500 | ||||||||
Tax reserve | $ 36,800 | ||||||||
Reasonably possible decrease in reserve for uncertain tax positions | $ 36,800 | $ 36,800 | |||||||
Net deferred tax liability | 382,800 | 382,800 | $ 198,300 | ||||||
Deferred tax asset | 761,171 | 761,171 | 771,652 | ||||||
Deferred tax liability | $ 1,144,002 | 1,144,002 | $ 969,996 | ||||||
Increase in net deferred liabilities | $ 184,500 | ||||||||
Settled Litigation | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Tax reserve | $ 230,100 | ||||||||
Foreign | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Foreign taxes paid | $ 264,000 | ||||||||
U.K. | Settled Litigation | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Foreign taxes paid | $ 132,000 |
FAIR VALUE (General) (Details) - Recurring - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 14,269,568 | $ 15,395,769 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 342,022 | 139,616 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 13,267,754 | 14,571,332 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 659,792 | $ 684,821 |
Percentage of level 3 assets to total assets held at fair value | 4.60% | |
Percentage of level 3 assets to total assets | 0.50% |
FAIR VALUE (Fair Value Measurements, Recurring) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|---|---|---|---|
Financial assets: | ||||||
AFS investment securities | $ 13,064,873 | $ 14,413,183 | ||||
Other investments - trading securities | 1,874 | 1 | ||||
RICs held-for-investment | 152,100 | 186,500 | ||||
Other assets - derivatives | 645,666 | 456,513 | ||||
Total MSRs | 161,294 | 149,197 | ||||
Financial liabilities: | ||||||
Other liabilities - derivatives | 597,702 | 411,575 | ||||
Residential MSRs | ||||||
Financial assets: | ||||||
MSRs | 158,470 | $ 160,130 | 145,993 | $ 146,091 | $ 149,455 | $ 146,589 |
Total MSRs | 161,300 | 149,200 | ||||
Recurring | ||||||
Financial assets: | ||||||
AFS investment securities | 13,064,873 | 14,402,369 | ||||
Other investments - trading securities | 1,874 | 1 | ||||
RICs held-for-investment | 152,082 | 186,471 | ||||
LHFS | 238,864 | 197,691 | ||||
MSRs | 158,470 | 145,993 | ||||
Other assets - derivatives | 653,405 | 463,244 | ||||
Total financial assets | 14,269,568 | 15,395,769 | ||||
Financial liabilities: | ||||||
Other liabilities - derivatives | 617,889 | 427,811 | ||||
Total financial liabilities | 617,889 | 427,811 | ||||
Recurring | U.S. Treasury securities | ||||||
Financial assets: | ||||||
AFS investment securities | 1,617,802 | 998,112 | ||||
Recurring | Corporate debt | ||||||
Financial assets: | ||||||
AFS investment securities | 6,453 | 11,660 | ||||
Recurring | ABS | ||||||
Financial assets: | ||||||
AFS investment securities | 477,477 | 507,162 | ||||
Recurring | State and municipal securities | ||||||
Financial assets: | ||||||
AFS investment securities | 20 | 23 | ||||
Recurring | MBS | ||||||
Financial assets: | ||||||
AFS investment securities | 10,963,121 | 12,885,412 | ||||
Recurring | Equity securities | ||||||
Financial assets: | ||||||
Equity securities | 10,800 | |||||
Recurring | Level 1 | ||||||
Financial assets: | ||||||
AFS investment securities | 342,021 | 139,615 | ||||
Other investments - trading securities | 1 | 1 | ||||
RICs held-for-investment | 0 | 0 | ||||
LHFS | 0 | 0 | ||||
MSRs | 0 | 0 | ||||
Other assets - derivatives | 0 | 0 | ||||
Total financial assets | 342,022 | 139,616 | ||||
Financial liabilities: | ||||||
Other liabilities - derivatives | 0 | 0 | ||||
Total financial liabilities | 0 | 0 | ||||
Recurring | Level 1 | U.S. Treasury securities | ||||||
Financial assets: | ||||||
AFS investment securities | 342,021 | 139,615 | ||||
Recurring | Level 1 | Corporate debt | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 1 | ABS | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 1 | State and municipal securities | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 1 | MBS | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 2 | ||||||
Financial assets: | ||||||
AFS investment securities | 12,375,996 | 13,912,502 | ||||
Other investments - trading securities | 1,873 | 0 | ||||
RICs held-for-investment | 0 | 0 | ||||
LHFS | 238,864 | 197,691 | ||||
MSRs | 0 | 0 | ||||
Other assets - derivatives | 651,021 | 461,139 | ||||
Total financial assets | 13,267,754 | 14,571,332 | ||||
Financial liabilities: | ||||||
Other liabilities - derivatives | 616,050 | 427,217 | ||||
Total financial liabilities | 616,050 | 427,217 | ||||
Recurring | Level 2 | U.S. Treasury securities | ||||||
Financial assets: | ||||||
AFS investment securities | 1,275,781 | 858,497 | ||||
Recurring | Level 2 | Corporate debt | ||||||
Financial assets: | ||||||
AFS investment securities | 6,453 | 11,660 | ||||
Recurring | Level 2 | ABS | ||||||
Financial assets: | ||||||
AFS investment securities | 130,621 | 156,910 | ||||
Recurring | Level 2 | State and municipal securities | ||||||
Financial assets: | ||||||
AFS investment securities | 20 | 23 | ||||
Recurring | Level 2 | MBS | ||||||
Financial assets: | ||||||
AFS investment securities | 10,963,121 | 12,885,412 | ||||
Recurring | Level 3 | ||||||
Financial assets: | ||||||
AFS investment securities | 346,856 | 350,252 | ||||
Other investments - trading securities | 0 | 0 | ||||
RICs held-for-investment | 152,082 | 186,471 | ||||
LHFS | 0 | 0 | ||||
MSRs | 158,470 | 145,993 | ||||
Other assets - derivatives | 2,384 | 2,105 | ||||
Total financial assets | 659,792 | 684,821 | ||||
Financial liabilities: | ||||||
Other liabilities - derivatives | 1,839 | 594 | ||||
Total financial liabilities | 1,839 | 594 | ||||
Recurring | Level 3 | U.S. Treasury securities | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 3 | Corporate debt | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 3 | ABS | ||||||
Financial assets: | ||||||
AFS investment securities | 346,856 | 350,252 | ||||
Recurring | Level 3 | State and municipal securities | ||||||
Financial assets: | ||||||
AFS investment securities | 0 | 0 | ||||
Recurring | Level 3 | MBS | ||||||
Financial assets: | ||||||
AFS investment securities | $ 0 | $ 0 |
FAIR VALUE (Fair Value Measurements, Non-recurring) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ 152,100 | $ 186,500 |
Total carrying value of the loans | 6,870,042 | 7,164,184 |
Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed assets | 110,192 | 126,592 |
Vehicle inventory | 255,361 | 325,203 |
LHFS | 1,320,960 | 2,324,830 |
MSRs | 9,358 | 9,273 |
Nonrecurring | Impaired commercial LHFI | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 452,619 | 583,175 |
Total carrying value of the loans | 402,500 | 491,500 |
Nonrecurring | Auto loans impaired due to bankruptcy | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 162,184 | 121,578 |
Nonrecurring | Impaired personal loans held for sale | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
LHFS | 956,400 | 1,100,000 |
Nonrecurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed assets | 0 | 0 |
Vehicle inventory | 0 | 0 |
LHFS | 0 | 0 |
MSRs | 0 | 0 |
Nonrecurring | Level 1 | Impaired commercial LHFI | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Nonrecurring | Level 1 | Auto loans impaired due to bankruptcy | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Nonrecurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed assets | 11,951 | 20,011 |
Vehicle inventory | 255,361 | 325,203 |
LHFS | 0 | 0 |
MSRs | 0 | 0 |
Nonrecurring | Level 2 | Impaired commercial LHFI | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 127,803 | 226,832 |
Nonrecurring | Level 2 | Auto loans impaired due to bankruptcy | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 162,184 | 121,578 |
Nonrecurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreclosed assets | 98,241 | 106,581 |
Vehicle inventory | 0 | 0 |
LHFS | 1,320,960 | 2,324,830 |
MSRs | 9,358 | 9,273 |
Nonrecurring | Level 3 | Impaired commercial LHFI | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 324,816 | 356,343 |
Nonrecurring | Level 3 | Auto loans impaired due to bankruptcy | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ 0 | $ 0 |
FAIR VALUE (Fair Value Adjustments) (Details) - Nonrecurring - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Impaired LHFI | Provision for credit losses | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value adjustment | $ 29,891 | $ 12,969 | $ 579 | $ (32,803) |
Foreclosed assets | Miscellaneous income, net | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value adjustment | (2,129) | (2,929) | (4,601) | (4,671) |
LHFS | Provision for credit losses | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value adjustment | (6) | (13,200) | (387) | (13,200) |
LHFS | Miscellaneous income, net | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value adjustment | (79,221) | (95,921) | (149,711) | (162,042) |
Auto loans impaired due to bankruptcy | Provision for credit losses | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value adjustment | (6,667) | (24,513) | (88,812) | (48,113) |
MSRs | Miscellaneous income, net | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value adjustment | $ 929 | $ 102 | $ 380 | $ 197 |
FAIR VALUE (Reconciliation of Assets and Liabilities Using Level 3 Inputs) (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
factor
|
Jun. 30, 2017
USD ($)
|
Jan. 28, 2014
USD ($)
|
|
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Number of primary factors driving gains | factor | 3 | ||||
RICs HFI | |||||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Unpaid principal balance on previously charged-off RIC portfolio | $ 3,000,000 | ||||
Level 3 | Recurring | |||||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Balances, beginning of period | $ 678,107 | $ 897,673 | $ 684,230 | $ 1,149,326 | |
Losses in other comprehensive income | (1,275) | (2,059) | (1,774) | (2,678) | |
Gains/(losses) in earnings | 2,187 | 2,139 | 22,640 | 21,681 | |
Additions/Issuances | 4,768 | 9,263 | 8,873 | 28,324 | |
Settlements | (25,834) | 4,842 | (56,016) | (284,795) | |
Balances, end of period | 657,953 | 911,858 | 657,953 | 911,858 | |
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | 2,056 | 3,553 | 22,361 | 21,101 | |
Level 3 | Recurring | Investments AFS | |||||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Balances, beginning of period | 348,634 | 573,454 | 350,252 | 814,567 | |
Losses in other comprehensive income | (1,275) | (2,059) | (1,774) | (2,678) | |
Gains/(losses) in earnings | 0 | 0 | 0 | 0 | |
Additions/Issuances | 0 | 0 | 0 | 0 | |
Settlements | (503) | 16,176 | (1,622) | (224,318) | |
Balances, end of period | 346,856 | 587,571 | 346,856 | 587,571 | |
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | 0 | 0 | 0 | 0 | |
Level 3 | Recurring | RICs HFI | |||||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Balances, beginning of period | 167,597 | 202,473 | 186,471 | 217,170 | |
Losses in other comprehensive income | 0 | 0 | 0 | 0 | |
Gains/(losses) in earnings | 4,760 | 4,742 | 10,036 | 21,633 | |
Additions/Issuances | 1,927 | 6,396 | 3,276 | 19,727 | |
Settlements | (22,202) | (6,395) | (47,701) | (51,314) | |
Balances, end of period | 152,082 | 207,216 | 152,082 | 207,216 | |
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | 4,760 | 4,742 | 10,036 | 21,633 | |
Level 3 | Recurring | MSRs | |||||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Balances, beginning of period | 160,130 | 149,455 | 145,993 | 146,589 | |
Losses in other comprehensive income | 0 | 0 | 0 | 0 | |
Gains/(losses) in earnings | (1,274) | (1,194) | 13,769 | 263 | |
Additions/Issuances | 2,841 | 2,867 | 5,597 | 8,597 | |
Settlements | (3,227) | (5,037) | (6,889) | (9,358) | |
Balances, end of period | 158,470 | 146,091 | 158,470 | 146,091 | |
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | (1,274) | (1,194) | 13,769 | 263 | |
Level 3 | Recurring | Derivatives | |||||
Fair Value, Assets, Unobservable Input Reconciliation [Roll Forward] | |||||
Balances, beginning of period | 1,746 | (27,709) | 1,514 | (29,000) | |
Losses in other comprehensive income | 0 | 0 | 0 | 0 | |
Gains/(losses) in earnings | (1,299) | (1,409) | (1,165) | (215) | |
Additions/Issuances | 0 | 0 | 0 | 0 | |
Settlements | 98 | 98 | 196 | 195 | |
Balances, end of period | 545 | (29,020) | 545 | (29,020) | |
Changes in unrealized gains (losses) included in earnings related to balances still held at end of period | $ (1,430) | $ 5 | $ (1,444) | $ (795) |
FAIR VALUE (Sensitivity Analysis of Fair Value, Mortgage Servicing Rights) (Details) - MSRs $ in Millions |
Jun. 30, 2018
USD ($)
|
---|---|
Sensitivity Analysis of Fair Value of Interests Continued to be Held by Transferor, Servicing Assets or Liabilities, Impact of Adverse Change in Assumption [Line Items] | |
Sensitivity analysis of fair value, impact of 10 percent adverse change in prepayment speed | $ (5.2) |
Sensitivity analysis of fair value, impact of 20 percent adverse change in prepayment speed | (10.0) |
Sensitivity analysis of fair value, impact of 10 percent adverse change in discount rate | (5.9) |
Sensitivity analysis of fair value, impact of 20 percent adverse change in discount rate | $ (11.3) |
FAIR VALUE (Quantitative Information) (Details) $ in Thousands |
Jun. 30, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
---|---|---|
Financial Assets: | ||
RICs held-for-investment | $ 152,100 | $ 186,500 |
MSRs | 161,294 | 149,197 |
Derivatives | 645,666 | 456,513 |
Level 3 | Mortgage banking interest rate lock commitments | ||
Financial Assets: | ||
Derivatives | $ 2,384 | $ 2,105 |
Level 3 | Mortgage banking interest rate lock commitments | Minimum | ||
Financial Assets: | ||
Embedded Derivatives, Unobservable Inputs (as a percent) | 0.0073 | 0.0073 |
Level 3 | Mortgage banking interest rate lock commitments | Maximum | ||
Financial Assets: | ||
Embedded Derivatives, Unobservable Inputs (as a percent) | 0.0103 | 0.0103 |
Level 3 | Mortgage banking interest rate lock commitments | Weighted Average | ||
Financial Assets: | ||
Embedded Derivatives, Unobservable Inputs (as a percent) | 0.0114 | 0.0095 |
Level 3 | Mortgage banking interest rate lock commitments | Pull through percentage | ||
Financial Assets: | ||
Derivatives, Unobservable Inputs (as a percent) | 0.7752 | 0.7698 |
Level 3 | Financing bonds | ||
Financial Assets: | ||
ABS | $ 304,382 | $ 304,727 |
Level 3 | Financing bonds | Discount Rate | Minimum | ||
Financial Assets: | ||
ABS, Unobservable Inputs (as a percent) | 0.0300 | 0.0216 |
Level 3 | Financing bonds | Discount Rate | Maximum | ||
Financial Assets: | ||
ABS, Unobservable Inputs (as a percent) | 0.0320 | 0.0290 |
Level 3 | Financing bonds | Discount Rate | Weighted Average | ||
Financial Assets: | ||
ABS, Unobservable Inputs (as a percent) | 0.0303 | 0.0228 |
Level 3 | Sale-leaseback securities | ||
Financial Assets: | ||
ABS | $ 42,474 | $ 45,525 |
Level 3 | Sale-leaseback securities | Offered quotes | ||
Financial Assets: | ||
ABS, Unobservable Inputs (as a percent) | 1.1361 | 1.2019 |
Level 3 | RICs HFI | ||
Financial Assets: | ||
RICs held-for-investment | $ 152,082 | $ 186,471 |
Level 3 | RICs HFI | Discount Rate | Minimum | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.0950 | 0.0950 |
Level 3 | RICs HFI | Discount Rate | Maximum | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.1450 | 0.1450 |
Level 3 | RICs HFI | Discount Rate | Weighted Average | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.1247 | 0.1237 |
Level 3 | RICs HFI | Prepayment rate (CPR) | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.0666 | 0.0666 |
Level 3 | RICs HFI | Recovery Rate | Minimum | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.2500 | 0.2500 |
Level 3 | RICs HFI | Recovery Rate | Maximum | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.4300 | 0.4300 |
Level 3 | RICs HFI | Recovery Rate | Weighted Average | ||
Financial Assets: | ||
RICs HFI, Unobservable Inputs (as a percent) | 0.4160 | 0.4151 |
Level 3 | Personal LHFS | ||
Financial Assets: | ||
LHFS | $ 956,455 | $ 1,062,090 |
Level 3 | Personal LHFS | Discount Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.1500 | 0.1500 |
Level 3 | Personal LHFS | Discount Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.2500 | 0.2000 |
Level 3 | Personal LHFS | Market Participant View | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.7000 | 0.7000 |
Level 3 | Personal LHFS | Market Participant View | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.8000 | 0.8000 |
Level 3 | Personal LHFS | Default Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.3000 | 0.3000 |
Level 3 | Personal LHFS | Default Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.4000 | 0.4000 |
Level 3 | Personal LHFS | Net Principal Payment Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.5000 | 0.5000 |
Level 3 | Personal LHFS | Net Principal Payment Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.7000 | 0.7000 |
Level 3 | Personal LHFS | Loss Severity Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.9000 | 0.9000 |
Level 3 | Personal LHFS | Loss Severity Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.9500 | 0.9500 |
Level 3 | RICs HFS | ||
Financial Assets: | ||
LHFS | $ 280,113 | $ 1,101,049 |
Level 3 | RICs HFS | Minimum | ||
Financial Assets: | ||
Weighted Average Life | 2 years | |
Level 3 | RICs HFS | Maximum | ||
Financial Assets: | ||
Weighted Average Life | 3 years | |
Level 3 | RICs HFS | Discount Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0300 | |
Level 3 | RICs HFS | Discount Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0600 | |
Level 3 | RICs HFS | Default Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0300 | |
Level 3 | RICs HFS | Default Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0400 | |
Level 3 | RICs HFS | Loss Severity Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.5000 | |
Level 3 | RICs HFS | Loss Severity Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.6000 | |
Level 3 | RICs HFS | Expected Yield | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0100 | |
Level 3 | RICs HFS | Expected Yield | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0200 | |
Level 3 | RICs HFS | Expected Life Time Cumulative Loss | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0400 | |
Level 3 | RICs HFS | Expected Life Time Cumulative Loss | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.0600 | |
Level 3 | RICs HFS | Prepayment Rate | Minimum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.1500 | |
Level 3 | RICs HFS | Prepayment Rate | Maximum | ||
Financial Assets: | ||
LHFS, Unobservable Inputs (as a percent) | 0.2000 | |
Level 3 | MSRs | ||
Financial Assets: | ||
MSRs | $ 158,470 | $ 145,993 |
Level 3 | MSRs | Discount Rate | ||
Financial Assets: | ||
MSRs, Unobservable Inputs (as a percent) | 0.0975 | 0.0990 |
Level 3 | MSRs | Prepayment rate (CPR) | Minimum | ||
Financial Assets: | ||
MSRs, Unobservable Inputs (as a percent) | 0.0691 | 0.0006 |
Level 3 | MSRs | Prepayment rate (CPR) | Maximum | ||
Financial Assets: | ||
MSRs, Unobservable Inputs (as a percent) | 1.0000 | 0.4695 |
Level 3 | MSRs | Prepayment rate (CPR) | Weighted Average | ||
Financial Assets: | ||
MSRs, Unobservable Inputs (as a percent) | 0.0849 | 0.0980 |
FAIR VALUE (Fair Value of Financial Instruments) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Financial assets: | ||
Investment in debt securities AFS | $ 13,064,873 | $ 14,413,183 |
Investment in debt securities HTM | 2,826,499 | 1,773,938 |
Other investments - trading securities | 1,874 | 1 |
LHFI, net | 79,326,170 | 76,829,277 |
Derivatives | 645,666 | 456,513 |
Equity securities in other investments | 10,917 | 0 |
Financial liabilities: | ||
Derivatives | 597,702 | 411,575 |
Recurring | ||
Financial assets: | ||
Investment in debt securities AFS | 13,064,873 | 14,402,369 |
Other investments - trading securities | 1,874 | 1 |
LHFS | 238,864 | 197,691 |
MSRs | 158,470 | 145,993 |
Derivatives | 653,405 | 463,244 |
Financial liabilities: | ||
Derivatives | 617,889 | 427,811 |
Recurring | Equity securities | ||
Financial assets: | ||
Equity securities | 10,800 | |
Level 1 | Recurring | ||
Financial assets: | ||
Investment in debt securities AFS | 342,021 | 139,615 |
Other investments - trading securities | 1 | 1 |
LHFS | 0 | 0 |
MSRs | 0 | 0 |
Derivatives | 0 | 0 |
Financial liabilities: | ||
Derivatives | 0 | 0 |
Level 2 | Recurring | ||
Financial assets: | ||
Investment in debt securities AFS | 12,375,996 | 13,912,502 |
Other investments - trading securities | 1,873 | 0 |
LHFS | 238,864 | 197,691 |
MSRs | 0 | 0 |
Derivatives | 651,021 | 461,139 |
Financial liabilities: | ||
Derivatives | 616,050 | 427,217 |
Level 3 | Recurring | ||
Financial assets: | ||
Investment in debt securities AFS | 346,856 | 350,252 |
Other investments - trading securities | 0 | 0 |
LHFS | 0 | 0 |
MSRs | 158,470 | 145,993 |
Derivatives | 2,384 | 2,105 |
Financial liabilities: | ||
Derivatives | 1,839 | 594 |
Carrying Value | ||
Financial assets: | ||
Cash and amounts due from depository institutions | 6,127,604 | 6,519,967 |
Investment in debt securities AFS | 13,064,873 | 14,402,369 |
Investment in debt securities HTM | 2,920,087 | 1,799,808 |
Other investments - trading securities | 1,874 | 1 |
LHFI, net | 79,326,170 | 76,829,277 |
LHFS | 1,559,799 | 2,522,486 |
Restricted cash | 3,123,208 | 3,818,807 |
MSRs | 161,294 | 149,197 |
Derivatives | 653,405 | 463,244 |
Financial liabilities: | ||
Deposits | 61,556,548 | 60,831,103 |
Borrowings and other debt obligations | 38,771,378 | 39,003,313 |
Derivatives | 617,889 | 427,811 |
Fair Value | ||
Financial assets: | ||
Cash and amounts due from depository institutions | 6,127,604 | 6,519,967 |
Investment in debt securities AFS | 13,064,873 | 14,402,369 |
Investment in debt securities HTM | 2,826,499 | 1,773,938 |
Other investments - trading securities | 1,874 | 1 |
LHFI, net | 79,833,705 | 78,579,144 |
LHFS | 1,559,824 | 2,522,521 |
Restricted cash | 3,123,208 | 3,818,807 |
MSRs | 167,828 | 155,266 |
Derivatives | 653,405 | 463,244 |
Financial liabilities: | ||
Deposits | 61,556,508 | 60,864,110 |
Borrowings and other debt obligations | 38,907,770 | 39,335,087 |
Derivatives | 617,889 | 427,811 |
Fair Value | Level 1 | ||
Financial assets: | ||
Cash and amounts due from depository institutions | 6,127,604 | 6,519,967 |
Investment in debt securities AFS | 342,021 | 139,615 |
Investment in debt securities HTM | 0 | 0 |
Other investments - trading securities | 1 | 1 |
LHFI, net | 0 | 0 |
LHFS | 0 | 0 |
Restricted cash | 3,123,208 | 3,818,807 |
MSRs | 0 | 0 |
Derivatives | 0 | 0 |
Financial liabilities: | ||
Deposits | 55,757,515 | 55,456,511 |
Borrowings and other debt obligations | 0 | 0 |
Derivatives | 0 | 0 |
Fair Value | Level 2 | ||
Financial assets: | ||
Cash and amounts due from depository institutions | 0 | 0 |
Investment in debt securities AFS | 12,375,996 | 13,912,502 |
Investment in debt securities HTM | 2,826,499 | 1,773,938 |
Other investments - trading securities | 1,873 | 0 |
LHFI, net | 37,803 | 136,832 |
LHFS | 238,864 | 197,691 |
Restricted cash | 0 | 0 |
MSRs | 0 | 0 |
Derivatives | 651,021 | 461,139 |
Financial liabilities: | ||
Deposits | 5,798,993 | 5,407,599 |
Borrowings and other debt obligations | 26,351,342 | 23,281,166 |
Derivatives | 616,050 | 427,217 |
Fair Value | Level 3 | ||
Financial assets: | ||
Cash and amounts due from depository institutions | 0 | 0 |
Investment in debt securities AFS | 346,856 | 350,252 |
Investment in debt securities HTM | 0 | 0 |
Other investments - trading securities | 0 | 0 |
LHFI, net | 79,795,902 | 78,442,312 |
LHFS | 1,320,960 | 2,324,830 |
Restricted cash | 0 | 0 |
MSRs | 167,828 | 155,266 |
Derivatives | 2,384 | 2,105 |
Financial liabilities: | ||
Deposits | 0 | 0 |
Borrowings and other debt obligations | 12,556,428 | 16,053,921 |
Derivatives | $ 1,839 | $ 594 |
FAIR VALUE (Fair Value Option for Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jan. 28, 2014 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
|
Fair Value | |||||||||
Nonaccrual loans | $ 8,523 | $ 8,523 | $ 15,023 | ||||||
Aggregate UPB | |||||||||
Nonaccrual loans | 11,863 | 11,863 | 19,836 | ||||||
Difference | |||||||||
Nonaccrual loans | (3,340) | (3,340) | (4,813) | ||||||
Residential mortgages | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
MSRs | 158,470 | $ 146,091 | 158,470 | $ 146,091 | $ 160,130 | 145,993 | $ 149,455 | $ 146,589 | |
Change in fair value due to valuation assumptions | (1,300) | $ (1,200) | $ 13,800 | $ 300 | |||||
LHFS | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Threshold period for discontinuing and reversing accrual of interest (more than) | 90 days | ||||||||
Fair Value | |||||||||
LHFS | 238,864 | $ 238,864 | 197,691 | ||||||
Aggregate UPB | |||||||||
LHFS | 231,327 | 231,327 | 194,928 | ||||||
Difference | |||||||||
LHFS | 7,537 | 7,537 | 2,763 | ||||||
RICs HFI | |||||||||
Fair Value | |||||||||
RICs HFI | 152,082 | 152,082 | 186,471 | ||||||
Aggregate UPB | |||||||||
RICs HFI | 172,448 | 172,448 | 211,580 | ||||||
Difference | |||||||||
RICs HFI | $ (20,366) | $ (20,366) | $ (25,109) | ||||||
SC | RICs HFI | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||
Threshold period for discontinuing and reversing accrual of interest (more than) | 60 days | 60 days | |||||||
Fair Value | |||||||||
RICs HFI | $ 1,900,000 | ||||||||
Aggregate UPB | |||||||||
RICs HFI | $ 2,600,000 |
NON-INTEREST INCOME (Schedule of Non-Interest Income) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Disaggregation of Revenue [Line Items] | ||||
Consumer and commercial fees | $ 136,165 | $ 162,334 | $ 276,337 | $ 316,702 |
Lease income | 569,306 | 489,043 | 1,110,202 | 985,087 |
Mortgage banking income, net | 2,933 | 19,278 | ||
BOLI | 14,816 | 29,384 | ||
Capital market revenue | 41,083 | 97,696 | ||
Net gain on sale of operating leases | 65,742 | 118,941 | ||
Asset and wealth management fees | 43,922 | 87,259 | ||
Loss on sale of non-mortgage loans | (74,872) | (118,782) | ||
Other miscellaneous income, net | 19,659 | 309 | ||
Net (losses)/gains on sale of investment securities | 419 | 9,049 | (244) | 9,569 |
TOTAL NON-INTEREST INCOME | 819,173 | 729,809 | 1,620,380 | 1,455,884 |
Calculated under Revenue Guidance in Effect before Topic 606 | ||||
Disaggregation of Revenue [Line Items] | ||||
Consumer and commercial fees | 137,051 | 162,334 | 274,944 | 316,702 |
Lease income | 489,043 | 985,087 | ||
Mortgage banking income, net | 15,092 | 28,266 | ||
BOLI | 14,052 | 31,351 | ||
Capital market revenue | 39,771 | 85,587 | ||
Net gain on sale of operating leases | 39,810 | 62,525 | ||
Asset and wealth management fees | 39,438 | 75,939 | ||
Loss on sale of non-mortgage loans | (87,837) | (157,604) | ||
Other miscellaneous income, net | 9,057 | 18,462 | ||
Net (losses)/gains on sale of investment securities | 9,049 | 9,569 | ||
TOTAL NON-INTEREST INCOME | $ 812,017 | $ 729,809 | $ 1,609,025 | $ 1,455,884 |
NON-INTEREST INCOME (Disaggregation by Revenue Source) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Disaggregation of Revenue [Line Items] | ||||
Lease income | $ 569,306 | $ 489,043 | $ 1,110,202 | $ 985,087 |
Miscellaneous income/(loss) | (1,782) | (28,362) | 12,010 | (56,360) |
Net (losses)/gains on sale of investment securities | 419 | 9,049 | (244) | 9,569 |
Out-of-scope of revenue from contracts with customers | 638,914 | 564,133 | 1,266,143 | 1,119,795 |
Non-interest income | 819,173 | 729,809 | 1,620,380 | 1,455,884 |
Depository services | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 57,432 | 115,778 | ||
Non-interest income | 62,415 | 122,855 | ||
Commission and trailer fees | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 31,982 | 61,432 | ||
Non-interest income | 30,179 | 61,347 | ||
Interchange income, net | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 16,170 | 29,643 | ||
Non-interest income | 16,745 | 29,394 | ||
Underwriting service fees | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 24,840 | 49,344 | ||
Non-interest income | 17,962 | 42,562 | ||
Asset and wealth management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 42,151 | 80,354 | ||
Non-interest income | 30,816 | 59,061 | ||
Other revenue from contracts with customers | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 7,684 | 17,686 | ||
Non-interest income | 7,559 | 20,870 | ||
Total in-scope of revenue from contracts with customers | ||||
Disaggregation of Revenue [Line Items] | ||||
In-scope of revenue from contracts with customers | 180,259 | 354,237 | ||
Non-interest income | 165,676 | 336,089 | ||
Consumer and commercial fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Out-of-scope of revenue from contracts with customers | $ 70,971 | $ 94,403 | $ 144,175 | $ 181,499 |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Other Commitments) (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Other Commitments [Line Items] | ||
Lines of credit outstanding | $ 84,600 | $ 90,900 |
Total commitments | 31,288,527 | 31,129,148 |
Commitments to extend credit | ||
Other Commitments [Line Items] | ||
Other commitments | 29,713,289 | 29,475,864 |
Letters of credit | ||
Other Commitments [Line Items] | ||
Other commitments | 1,460,244 | 1,559,297 |
Letters of credit | 1,460,244 | 1,559,297 |
Unsecured revolving lines of credit | ||
Other Commitments [Line Items] | ||
Lines of credit outstanding | 28,002 | 27,938 |
Recourse exposure on sold loans | ||
Other Commitments [Line Items] | ||
Other commitments | 36,981 | 46,572 |
Commitments to sell loans | ||
Other Commitments [Line Items] | ||
Other commitments | $ 50,011 | $ 19,477 |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Commitments to Extend Credit) (Details) - Commitments to extend credit - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Other Commitments [Line Items] | ||
Commitments that can be canceled without notice | $ 6,700,000 | $ 6,400,000 |
Commitments to extend credit expiring per period: | ||
1 year or less | 4,785,053 | 5,858,236 |
Over 1 year to 3 years | 4,476,079 | 5,381,113 |
Over 3 years to 5 years | 5,981,334 | 4,478,320 |
Over 5 years | 14,470,823 | 13,758,195 |
Total | $ 29,713,289 | $ 29,475,864 |
Commitment period | 5 years |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Letters of Credit) (Details) - USD ($) $ in Thousands |
6 Months Ended | |||||
---|---|---|---|---|---|---|
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
|
Other Commitments [Line Items] | ||||||
Reserve for unfunded lending commitments | $ 86,973 | $ 89,866 | $ 109,111 | $ 111,811 | $ 120,396 | $ 122,419 |
Lines of credit outstanding | $ 84,600 | 90,900 | ||||
Letters of credit | ||||||
Other Commitments [Line Items] | ||||||
Commitments, weighted average term | 1 year 3 months 15 days | |||||
Commitment amount | $ 1,460,244 | 1,559,297 | ||||
Reserve for unfunded lending commitments | 2,400 | 18,200 | ||||
Letters of credit expiring per period: | ||||||
1 year or less | 753,852 | 918,191 | ||||
Over 1 year to 3 years | 308,273 | 286,505 | ||||
Over 3 years to 5 years | 313,009 | 312,881 | ||||
Over 5 years | 85,110 | 41,720 | ||||
Total | $ 1,460,244 | $ 1,559,297 |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Loans Sold with Recourse and Commitments to Sell Loans) (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Recourse exposure on sold loans | ||
Other Commitments [Line Items] | ||
Retained credit risk, multifamily servicing | $ 0 | $ 1,300,000 |
Recourse exposure on sold loans | FNMA | Multifamily loans | ||
Other Commitments [Line Items] | ||
Loans sold with recourse, unpaid principal balance | $ 52,400,000 | 136,000,000 |
Loans sold with recourse, portion of first credit loss position retained, percent | 100.00% | |
Value of underlying collateral | $ 12,200,000 | $ 12,200,000 |
Commitments to sell loans | ||
Other Commitments [Line Items] | ||
Forward contracts maturity period (less than) | 1 year |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (SC Commitments) (Details) - USD ($) |
6 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
Dec. 31, 2015 |
May 01, 2017 |
Jan. 31, 2017 |
Dec. 31, 2016 |
|
Long-term Purchase Commitment [Line Items] | ||||||
Accrued legal and regulatory liabilities | $ 176,900,000 | $ 161,800,000 | ||||
SC | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Purchase obligation | 15,700,000 | 11,500,000 | ||||
Loans subject of a demand to repurchase | 0 | |||||
Minimum sales commitment, charged off loan receivables | 350,000,000 | |||||
Threshold for sales subject to market price check (over) | 275,000,000 | |||||
Minimum sales commitment, loans receivable, written off, remaining | 78,500,000 | 98,900,000 | ||||
SC | Other miscellaneous contingencies | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Accrued legal and regulatory liabilities | 14,300,000 | 6,300,000 | ||||
SC | Maximum | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Purchase commitment, repurchase rate (up to) (as a percent) | 9.99% | |||||
Purchase commitment, exercise of repurchase rights, retainer rate (up to) (as a percent) | 20.00% | |||||
SC | Bluestem | Purchase new advances on personal revolving financing receivable | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Accrued commitments | 3,800,000,000 | 3,900,000,000 | $ 4,000,000,000 | |||
Purchases of receivables | 500,000,000 | 1,200,000,000 | ||||
SC | Bluestem | Purchase of receivables related to new opened customer account | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Purchases of receivables | 83,800,000 | |||||
SC | Chrysler | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Financing dedicated to FCA retail financing | $ 4,500,000,000 | |||||
Commitment to meet escalating penetration rates, period | 5 years | |||||
SC | Chrysler | Minimum | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Funding available for dealer inventory financing | $ 5,000,000,000 | |||||
SC | Chrysler | Revenue sharing payments and gain-sharing payments to FCA | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Accrued commitments | $ 11,100,000 | 6,600,000 | ||||
SC | Bank of America | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Total commitments | $ 300,000,000.0 | |||||
Servicer payments period | 6 years | |||||
SC | Bank of America | Service performance fee | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Accrued commitments | $ 7,000,000 | 8,100,000 | ||||
SC | CBP | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Loss-sharing payment percentage | 0.50% | |||||
SC | CBP | Maximum | Chrysler | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Purchase amount committed | $ 200,000,000 | |||||
SC | CBP | Minimum | Chrysler | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Purchase amount committed | $ 50,000,000 | |||||
SC | CBP | Loss sharing payment | ||||||
Long-term Purchase Commitment [Line Items] | ||||||
Accrued commitments | $ 5,000,000 | $ 5,600,000 |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Impact From Hurricanes) (Details) - Hurricanes $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Sep. 30, 2017
hurricane
|
Jun. 30, 2018
USD ($)
|
|
Greater Texas, Florida and Puerto Rico | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Number of significant hurricanes | hurricane | 3 | |
Increase in allowance for loan losses | $ 95 | |
Puerto Rico | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Maximum loan exposure | 3,400 | |
Puerto Rico | Loans to Municipalities | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Maximum loan exposure | 220 | |
Puerto Rico | Consumer | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Maximum loan exposure | 1,600 | |
Puerto Rico | Commercial | ||
Unusual or Infrequent Item, or Both [Line Items] | ||
Maximum loan exposure | $ 1,800 |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Legal and Regulatory Proceedings) (Details) $ in Thousands |
1 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|---|
Jan. 03, 2018
claim
|
Jul. 14, 2016
USD ($)
|
Mar. 26, 2015
USD ($)
|
Feb. 28, 2015
USD ($)
|
Jun. 30, 2018
USD ($)
claim
|
Dec. 31, 2014
USD ($)
|
Jul. 31, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
Oct. 31, 2013
USD ($)
|
|
Loss Contingencies [Line Items] | |||||||||
Accrued legal and regulatory liabilities | $ 176,900 | $ 161,800 | |||||||
Puerto Rico FINRA Arbitrations | |||||||||
Loss Contingencies [Line Items] | |||||||||
Number of FINRA arbitration cases | claim | 458 | ||||||||
Number of claims that remain pending | claim | 327 | ||||||||
Puerto Rico Closed-End Funds Shareholder Derivative and Class Action | Puerto Rico | |||||||||
Loss Contingencies [Line Items] | |||||||||
Bonds (more than) | $ 180,000 | ||||||||
Closed-end funds | $ 101,000 | ||||||||
SBNA | Identity Theft Protection Product Matter | |||||||||
Loss Contingencies [Line Items] | |||||||||
Identity theft protection payments returned to customers | $ 6,000 | $ 37,300 | |||||||
SBNA | Overdraft Coverage Consent Order | |||||||||
Loss Contingencies [Line Items] | |||||||||
Remediation payment | $ 10,000 | ||||||||
SC | Parmelee Lawsuit | |||||||||
Loss Contingencies [Line Items] | |||||||||
Number of claims dismissed | claim | 2 | ||||||||
SC | Parmelee Lawsuit | Subsequent Event | |||||||||
Loss Contingencies [Line Items] | |||||||||
Estimate of possible loss | $ 9,500 | ||||||||
SC | Violation of Service Members Civil Relief Act | |||||||||
Loss Contingencies [Line Items] | |||||||||
SCRA compliance period | 5 years | ||||||||
SC | Violation of Service Members Civil Relief Act | Civil Fine | |||||||||
Loss Contingencies [Line Items] | |||||||||
Damages sought, value | $ 55 | ||||||||
SC | Violation of Service Members Civil Relief Act | Lost Equity for Each Repossession | |||||||||
Loss Contingencies [Line Items] | |||||||||
Damages sought, value | 10 | ||||||||
SC | Violation of Service Members Civil Relief Act | Sought to Collect Repossession-related Fees | |||||||||
Loss Contingencies [Line Items] | |||||||||
Damages sought, value | 5 | ||||||||
Maximum | |||||||||
Loss Contingencies [Line Items] | |||||||||
Estimate of possible loss | $ 273,000 | $ 255,000 | |||||||
Minimum | SC | Violation of Service Members Civil Relief Act | Civil Fine to Affected Service Members | |||||||||
Loss Contingencies [Line Items] | |||||||||
Damages sought, value | $ 9,400 |
RELATED PARTY TRANSACTIONS (Contributions from Santander) (Details) - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Jan. 01, 2018 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Related Party Transaction [Line Items] | ||||
Contribution from shareholder | $ 5,741 | $ 9,000 | ||
Affiliated Entity | Santander | ||||
Related Party Transaction [Line Items] | ||||
Cash contribution | 5,741 | 9,000 | $ 15,300 | |
Adjustment to book value of assets purchased on January 1 | $ 300 | 277 | 0 | |
Deferred tax asset on purchased assets | 3,156 | 0 | ||
Contribution from shareholder | $ 9,174 | $ 9,000 |
RELATED PARTY TRANSACTIONS (Narrative) (Details) - Affiliated Entity - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|---|
Jan. 01, 2018 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Santander | ||||||
Related Party Transaction [Line Items] | ||||||
Net capital contribution | $ 2,800 | |||||
Cash contribution | $ 5,741 | $ 9,000 | 15,300 | |||
Return of capital | 12,500 | |||||
Adjustment to book value of assets purchased on January 1 | $ 300 | 277 | 0 | |||
Deferred tax asset on purchased assets | 3,156 | 0 | ||||
SBNA | ||||||
Related Party Transaction [Line Items] | ||||||
Assets contributed | 3,100 | |||||
Produban Servicios Informaticos Generales S.L. And Ingenieria De Software Bancario S.L. | Net Book Value, Net Assets Acquired | Santander | ||||||
Related Party Transaction [Line Items] | ||||||
Amount of related party transactions | 2,800 | |||||
Produban Servicios Informaticos Generales S.L. And Ingenieria De Software Bancario S.L. | Fair Value, Net Assets Acquired | Santander | ||||||
Related Party Transaction [Line Items] | ||||||
Amount of related party transactions | $ 15,300 | |||||
SC | Santander | ||||||
Related Party Transaction [Line Items] | ||||||
Sale of loans securitized | $ 1,200,000 | $ 500,000 | 2,600,000 | 1,200,000 | ||
Loss from sale of loans | 3,200 | $ 3,500 | 20,100 | $ 6,200 | ||
Servicing fee income | 70,500 | $ 13,000 | ||||
SC | Purchase of Retail Installment Contracts | SBNA | ||||||
Related Party Transaction [Line Items] | ||||||
Additions to servicing asset | $ 29,000 | $ 53,000 |
BUSINESS SEGMENT INFORMATION (Narrative) (Details) - USD ($) |
May 01, 2013 |
Jun. 30, 2018 |
---|---|---|
FCA | ||
Segment Reporting Information [Line Items] | ||
Private label financing agreement, term | 10 years | |
CIB | ||
Segment Reporting Information [Line Items] | ||
Minimum annual revenue to service corporations | $ 500,000,000 |
BUSINESS SEGMENT INFORMATION (Segment Information) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jan. 01, 2018 |
Dec. 31, 2017 |
|
Segment Reporting Information [Line Items] | ||||||
Net interest income | $ 1,537,616 | $ 1,641,749 | $ 3,033,558 | $ 3,244,313 | ||
Non-interest income | 819,173 | 729,809 | 1,620,380 | 1,455,884 | ||
Provision for / (release of) credit losses | 379,834 | 604,768 | 882,368 | 1,340,214 | ||
Total expenses | 1,449,749 | 1,387,044 | 2,891,107 | 2,737,591 | ||
INCOME BEFORE INCOME TAX PROVISION | 527,206 | 379,746 | 880,463 | 622,392 | ||
Intersegment revenue/(expense) | 0 | 0 | 0 | 0 | ||
Total assets | 130,138,694 | 134,755,695 | 130,138,694 | 134,755,695 | $ 128,295,952 | $ 128,294,030 |
Reportable Segments | Consumer & Business Banking | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 316,223 | 277,069 | 621,045 | 539,800 | ||
Non-interest income | 69,647 | 94,285 | 152,465 | 176,819 | ||
Provision for / (release of) credit losses | 18,283 | 21,410 | 56,672 | 43,861 | ||
Total expenses | 367,235 | 381,844 | 738,303 | 756,864 | ||
INCOME BEFORE INCOME TAX PROVISION | 352 | (31,900) | (21,465) | (84,106) | ||
Intersegment revenue/(expense) | 521 | 329 | 1,198 | 1,206 | ||
Total assets | 19,088,997 | 18,077,481 | 19,088,997 | 18,077,481 | ||
Reportable Segments | Commercial Banking | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 160,824 | 162,953 | 315,759 | 315,259 | ||
Non-interest income | 16,120 | 18,858 | 49,708 | 33,781 | ||
Provision for / (release of) credit losses | (13,001) | (1,089) | (22,742) | 4,297 | ||
Total expenses | 84,769 | 78,753 | 167,407 | 157,092 | ||
INCOME BEFORE INCOME TAX PROVISION | 105,176 | 104,147 | 220,802 | 187,651 | ||
Intersegment revenue/(expense) | 2,562 | 1,750 | 4,093 | 3,052 | ||
Total assets | 25,124,793 | 25,776,884 | 25,124,793 | 25,776,884 | ||
Reportable Segments | CIB | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 30,901 | 40,860 | 63,591 | 83,088 | ||
Non-interest income | 64,740 | 42,375 | 115,378 | 93,711 | ||
Provision for / (release of) credit losses | 3,764 | 13,635 | 1,709 | 12,271 | ||
Total expenses | 58,507 | 59,454 | 116,574 | 106,062 | ||
INCOME BEFORE INCOME TAX PROVISION | 33,370 | 10,146 | 60,686 | 58,466 | ||
Intersegment revenue/(expense) | (3,527) | (2,089) | (5,808) | (4,486) | ||
Total assets | 7,832,197 | 8,949,566 | 7,832,197 | 8,949,566 | ||
Reportable Segments | Other | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 66,267 | 65,273 | 129,070 | 122,000 | ||
Non-interest income | 110,271 | 155,855 | 221,540 | 304,619 | ||
Provision for / (release of) credit losses | 8,621 | 16,051 | 14,958 | 31,663 | ||
Total expenses | 217,368 | 244,249 | 442,975 | 467,939 | ||
INCOME BEFORE INCOME TAX PROVISION | (49,451) | (39,172) | (107,323) | (72,983) | ||
Intersegment revenue/(expense) | 444 | 10 | 517 | 228 | ||
Total assets | 36,919,571 | 42,444,282 | 36,919,571 | 42,444,282 | ||
Reportable Segments | SC | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 946,572 | 1,053,673 | 1,868,311 | 2,096,600 | ||
Non-interest income | 567,693 | 432,373 | 1,099,429 | 867,221 | ||
Provision for / (release of) credit losses | 352,575 | 520,555 | 811,570 | 1,155,568 | ||
Total expenses | 713,045 | 617,383 | 1,407,915 | 1,238,717 | ||
INCOME BEFORE INCOME TAX PROVISION | 448,645 | 348,108 | 748,255 | 569,536 | ||
Intersegment revenue/(expense) | 0 | 0 | 0 | 0 | ||
Total assets | 41,173,136 | 39,507,482 | 41,173,136 | 39,507,482 | ||
SC Purchase Price Adjustments | SC | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 7,693 | 34,095 | 17,588 | 71,399 | ||
Non-interest income | 2,869 | (3,719) | 5,555 | 1,735 | ||
Provision for / (release of) credit losses | 9,592 | 34,206 | 20,201 | 92,554 | ||
Total expenses | 11,683 | 11,508 | 23,412 | 23,380 | ||
INCOME BEFORE INCOME TAX PROVISION | (10,713) | (15,338) | (20,470) | (42,800) | ||
Intersegment revenue/(expense) | 0 | 0 | 0 | 0 | ||
Total assets | 0 | 0 | 0 | 0 | ||
Eliminations | ||||||
Segment Reporting Information [Line Items] | ||||||
Net interest income | 9,136 | 7,826 | 18,194 | 16,167 | ||
Non-interest income | (12,167) | (10,218) | (23,695) | (22,002) | ||
Provision for / (release of) credit losses | 0 | 0 | 0 | 0 | ||
Total expenses | (2,858) | (6,147) | (5,479) | (12,463) | ||
INCOME BEFORE INCOME TAX PROVISION | (173) | 3,755 | (22) | 6,628 | ||
Intersegment revenue/(expense) | 0 | 0 | 0 | 0 | ||
Total assets | $ 0 | $ 0 | $ 0 | $ 0 |
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