Allowance for Loan Losses, Allowance for Losses on Lending-Related Commitments and Impaired Loans

3 Months Ended

Mar. 31, 2014

Loans and Leases Receivable, Allowance [Abstract]

Allowance for Loan Losses, Allowance for Losses on Lending-Related Commitments and Impaired Loans

Allowance for Loan Losses, Allowance for Losses on Lending-Related Commitments and Impaired Loans

The tables below show the aging of the Company’s loan portfolio at March 31, 2014, December 31, 2013 and March 31, 2013:

As of March 31, 2014			90+ days and still accruing		60-89 days past due		30-59 days past due
(Dollars in thousands)	Nonaccrual								Current		Total Loans
Loan Balances:
Commercial
Commercial and industrial	$	11,112	$	387	$	2,235	$	16,150	$	1,965,425	$	1,995,309
Franchise	—		—		—		75		221,026		221,101
Mortgage warehouse lines of credit	—		—		—		—		60,809		60,809
Community Advantage—homeowners association	—		—		—		—		91,414		91,414
Aircraft	—		—		—		—		8,840		8,840
Asset-based lending	670		—		—		10,573		729,425		740,668
Tax exempt	—		—		—		—		177,973		177,973
Leases	—		—		—		—		121,986		121,986
Other	—		—		—		—		10,261		10,261
PCI - commercial (1)	—		1,079		—		865		8,892		10,836
Total commercial	11,782		1,466		2,235		27,663		3,396,051		3,439,197
Commercial real-estate:
Residential construction	—		—		680		27		35,690		36,397
Commercial construction	844		—		—		—		150,786		151,630
Land	2,405		—		2,682		3,438		99,445		107,970
Office	6,970		—		1,672		8,868		633,655		651,165
Industrial	6,101		—		1,114		2,706		615,139		625,060
Retail	9,540		—		217		3,089		664,584		677,430
Multi-family	1,327		—		—		3,820		570,616		575,763
Mixed use and other	6,546		—		6,626		10,744		1,337,320		1,361,236
PCI - commercial real-estate (1)	—		21,073		2,791		6,169		45,571		75,604
Total commercial real-estate	33,733		21,073		15,782		38,861		4,152,806		4,262,255
Home equity	7,311		—		1,650		4,972		693,815		707,748
Residential real estate	14,385		—		946		4,889		403,474		423,694
PCI - residential real estate (1)	—		1,414		—		248		1,413		3,075
Premium finance receivables
Commercial insurance loans	14,517		6,808		5,600		20,777		2,160,659		2,208,361
Life insurance loans	—		—		—		4,312		1,511,820		1,516,132
PCI - life insurance loans (1)	—		—		—		—		413,202		413,202
Consumer and other	1,144		57		213		550		157,290		159,254
PCI - consumer and other (1)	—		48		—		20		174		242
Total loans, net of unearned income, excluding covered loans	$	82,872	$	30,866	$	26,426	$	102,292	$	12,890,704	$	13,133,160
Covered loans	9,136		35,831		6,682		7,042		253,787		312,478
Total loans, net of unearned income	$	92,008	$	66,697	$	33,108	$	109,334	$	13,144,491	$	13,445,638

(1) PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30.Loan agings are based upon contractually required payments.

As of December 31, 2013			90+ days and still accruing		60-89 days past due		30-59 days past due
(Dollars in thousands)	Nonaccrual								Current		Total Loans
Loan Balances:
Commercial
Commercial and industrial	$	10,143	$	—	$	4,938	$	7,404	$	1,813,721	$	1,836,206
Franchise	—		—		400		—		219,983		220,383
Mortgage warehouse lines of credit	—		—		—		—		67,470		67,470
Community Advantage—homeowners association	—		—		—		—		90,894		90,894
Aircraft	—		—		—		—		10,241		10,241
Asset-based lending	637		—		388		1,878		732,190		735,093
Tax exempt	—		—		—		—		161,239		161,239
Leases	—		—		—		788		109,043		109,831
Other	—		—		—		—		11,147		11,147
PCI - commercial (1)	—		274		156		1,685		9,068		11,183
Total commercial	10,780		274		5,882		11,755		3,224,996		3,253,687
Commercial real-estate
Residential construction	149		—		—		—		38,351		38,500
Commercial construction	6,969		—		—		505		129,232		136,706
Land	2,814		—		4,224		619		99,128		106,785
Office	10,087		—		2,265		3,862		626,027		642,241
Industrial	5,654		—		585		914		626,785		633,938
Retail	10,862		—		837		2,435		642,125		656,259
Multi-family	2,035		—		—		348		564,154		566,537
Mixed use and other	8,088		230		3,943		15,949		1,344,244		1,372,454
PCI - commercial real-estate (1)	—		18,582		3,540		5,238		49,255		76,615
Total commercial real-estate	46,658		18,812		15,394		29,870		4,119,301		4,230,035
Home equity	10,071		—		1,344		3,060		704,662		719,137
Residential real-estate	14,974		—		1,689		5,032		410,430		432,125
PCI - residential real-estate (1)	—		1,988		—		—		879		2,867
Premium finance receivables
Commercial insurance loans	10,537		8,842		6,912		24,094		2,117,180		2,167,565
Life insurance loans	—		—		2,524		1,808		1,495,460		1,499,792
PCI - life insurance loans (1)	—		—		—		—		423,906		423,906
Consumer and other	1,137		105		76		1,010		163,956		166,284
PCI - consumer and other (1)	—		181		—		—		1,023		1,204
Total loans, net of unearned income, excluding covered loans	$	94,157	$	30,202	$	33,821	$	76,629	$	12,661,793	$	12,896,602
Covered loans	9,425		56,282		5,877		7,937		266,910		346,431
Total loans, net of unearned income	$	103,582	$	86,484	$	39,698	$	84,566	$	12,928,703	$	13,243,033

(1) PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30.Loan agings are based upon contractually required payments.

As of March 31, 2013			90+ days and still accruing		60-89 days past due		30-59 days past due
(Dollars in thousands)	Nonaccrual								Current		Total Loans
Loan Balances:
Commercial
Commercial and industrial	$	17,717	$	—	$	1,150	$	16,710	$	1,533,999	$	1,569,576
Franchise	125		—		—		76		194,310		194,511
Mortgage warehouse lines of credit	—		—		—		—		131,970		131,970
Community Advantage—homeowners association	—		—		—		—		82,763		82,763
Aircraft	—		—		—		—		14,112		14,112
Asset-based lending	531		—		483		5,518		680,723		687,255
Tax exempt	—		—		—		—		89,508		89,508
Leases	—		—		—		844		97,186		98,030
Other	—		—		—		—		127		127
PCI - commercial (1)	—		449		—		—		4,394		4,843
Total commercial	18,373		449		1,633		23,148		2,829,092		2,872,695
Commercial real-estate:
Residential construction	3,094		—		945		—		33,044		37,083
Commercial construction	1,086		—		9,521		—		151,751		162,358
Land	17,976		—		—		11,563		104,039		133,578
Office	3,564		—		8,990		4,797		567,333		584,684
Industrial	7,137		—		—		986		587,402		595,525
Retail	7,915		—		6,970		5,953		565,963		586,801
Multi-family	2,088		—		1,036		4,315		505,346		512,785
Mixed use and other	18,947		—		1,573		13,560		1,288,754		1,322,834
PCI - commercial real-estate (1)	—		1,866		251		3,333		49,367		54,817
Total commercial real-estate	61,807		1,866		29,286		44,507		3,852,999		3,990,465
Home equity	14,891		—		1,370		4,324		738,633		759,218
Residential real estate	9,606		—		782		8,680		340,751		359,819
PCI - residential real estate (1)	—		—		198		—		635		833
Premium finance receivables
Commercial insurance loans	12,068		7,677		4,647		19,323		1,953,445		1,997,160
Life insurance loans	20		2,256		—		1,340		1,250,165		1,253,781
PCI - life insurance loans (1)	—		—		—		—		499,731		499,731
Consumer and other	1,790		145		287		714		161,036		163,972
PCI - consumer and other (1)	—		—		—		20		2,618		2,638
Total loans, net of unearned income, excluding covered loans	$	118,555	$	12,393	$	38,203	$	102,056	$	11,629,105	$	11,900,312
Covered loans	1,820		115,482		1,454		12,268		387,637		518,661
Total loans, net of unearned income	$	120,375	$	127,875	$	39,657	$	114,324	$	12,016,742	$	12,418,973

(1) PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30.Loan agings are based upon contractually required payments.

Our ability to manage credit risk depends in large part on our ability to properly identify and manage problem loans. To do so, we operate a credit risk rating system under which our credit management personnel assign a credit risk rating (1 to 10 rating) to each loan at the time of origination and review loans on a regular basis.

Each loan officer is responsible for monitoring his or her loan portfolio, recommending a credit risk rating for each loan in his or her portfolio and ensuring the credit risk ratings are appropriate. These credit risk ratings are then ratified by the bank’s chief credit officer and/or concurrence credit officer. Credit risk ratings are determined by evaluating a number of factors including: a borrower’s financial strength, cash flow coverage, collateral protection and guarantees.

The Company’s Problem Loan Reporting system automatically includes all loans with credit risk ratings of 6 through 9. This system is designed to provide an on-going detailed tracking mechanism for each problem loan. Once management determines that a loan has deteriorated to a point where it has a credit risk rating of 6 or worse, the Company’s Managed Asset Division performs an overall credit and collateral review. As part of this review, all underlying collateral is identified and the valuation methodology is analyzed and tracked. As a result of this initial review by the Company’s Managed Asset Division, the credit risk rating is reviewed and a portion of the outstanding loan balance may be deemed uncollectible or an impairment reserve may be established. The Company’s impairment analysis utilizes an independent re-appraisal of the collateral (unless such a third-party evaluation is not possible due to the unique nature of the collateral, such as a closely-held business or thinly traded securities). In the case of commercial real-estate collateral, an independent third party appraisal is ordered by the Company’s Real Estate Services Group to determine if there has been any change in the underlying collateral value. These independent appraisals are reviewed by the Real Estate Services Group and sometimes by independent third party valuation experts and may be adjusted depending upon market conditions.

Through the credit risk rating process, loans are reviewed to determine if they are performing in accordance with the original contractual terms. If the borrower has failed to comply with the original contractual terms, further action may be required by the Company, including a downgrade in the credit risk rating, movement to non-accrual status, a charge-off or the establishment of a specific impairment reserve. If we determine that a loan amount, or portion thereof, is uncollectible, the loan’s credit risk rating is immediately downgraded to an 8 or 9 and the uncollectible amount is charged-off. Any loan that has a partial charge-off continues to be assigned a credit risk rating of an 8 or 9 for the duration of time that a balance remains outstanding. The Company undertakes a thorough and ongoing analysis to determine if additional impairment and/or charge-offs are appropriate and to begin a workout plan for the credit to minimize actual losses.

If, based on current information and events, it is probable that the Company will be unable to collect all amounts due to it according to the contractual terms of the loan agreement, a specific impairment reserve is established. In determining the appropriate charge-off for collateral-dependent loans, the Company considers the results of appraisals for the associated collateral.

Non-performing loans include all non-accrual loans (8 and 9 risk ratings) as well as loans 90 days past due and still accruing interest, excluding PCI loans. The remainder of the portfolio is considered performing under the contractual terms of the loan agreement. The following table presents the recorded investment based on performance of loans by class, excluding covered loans, per the most recent analysis at March 31, 2014, December 31, 2013 and March 31, 2013:

	Performing						Non-performing						Total
(Dollars in thousands)	March 31, 2014		December 31, 2013		March 31, 2013		March 31, 2014		December 31, 2013		March 31, 2013		March 31, 2014		December 31, 2013		March 31, 2013
Loan Balances:
Commercial
Commercial and industrial	$	1,983,810	$	1,826,063	$	1,551,859	$	11,499	$	10,143	$	17,717	$	1,995,309	$	1,836,206	$	1,569,576
Franchise	221,101		220,383		194,386		—		—		125		221,101		220,383		194,511
Mortgage warehouse lines of credit	60,809		67,470		131,970		—		—		—		60,809		67,470		131,970
Community Advantage—homeowners association	91,414		90,894		82,763		—		—		—		91,414		90,894		82,763
Aircraft	8,840		10,241		14,112		—		—		—		8,840		10,241		14,112
Asset-based lending	739,998		734,456		686,724		670		637		531		740,668		735,093		687,255
Tax exempt	177,973		161,239		89,508		—		—		—		177,973		161,239		89,508
Leases	121,986		109,831		98,030		—		—		—		121,986		109,831		98,030
Other	10,261		11,147		127		—		—		—		10,261		11,147		127
PCI - commercial (1)	10,836		11,183		4,843		—		—		—		10,836		11,183		4,843
Total commercial	3,427,028		3,242,907		2,854,322		12,169		10,780		18,373		3,439,197		3,253,687		2,872,695
Commercial real-estate
Residential construction	36,397		38,351		33,989		—		149		3,094		36,397		38,500		37,083
Commercial construction	150,786		129,737		161,272		844		6,969		1,086		151,630		136,706		162,358
Land	105,565		103,971		115,602		2,405		2,814		17,976		107,970		106,785		133,578
Office	644,195		632,154		581,120		6,970		10,087		3,564		651,165		642,241		584,684
Industrial	618,959		628,284		588,388		6,101		5,654		7,137		625,060		633,938		595,525
Retail	667,890		645,397		578,886		9,540		10,862		7,915		677,430		656,259		586,801
Multi-family	574,436		564,502		510,697		1,327		2,035		2,088		575,763		566,537		512,785
Mixed use and other	1,354,690		1,364,136		1,303,887		6,546		8,318		18,947		1,361,236		1,372,454		1,322,834
PCI - commercial real-estate(1)	75,604		76,615		54,817		—		—		—		75,604		76,615		54,817
Total commercial real-estate	4,228,522		4,183,147		3,928,658		33,733		46,888		61,807		4,262,255		4,230,035		3,990,465
Home equity	700,437		709,066		744,327		7,311		10,071		14,891		707,748		719,137		759,218
Residential real-estate	409,309		417,151		350,213		14,385		14,974		9,606		423,694		432,125		359,819
PCI - residential real-estate (1)	3,075		2,867		833		—		—		—		3,075		2,867		833
Premium finance receivables
Commercial insurance loans	2,187,036		2,148,186		1,977,415		21,325		19,379		19,745		2,208,361		2,167,565		1,997,160
Life insurance loans	1,516,132		1,499,792		1,251,505		—		—		2,276		1,516,132		1,499,792		1,253,781
PCI - life insurance loans (1)	413,202		423,906		499,731		—		—		—		413,202		423,906		499,731
Consumer and other	158,053		165,042		162,037		1,201		1,242		1,935		159,254		166,284		163,972
PCI - consumer and other(1)	242		1,204		2,638		—		—		—		242		1,204		2,638
Total loans, net of unearned income, excluding covered loans	$	13,043,036	$	12,793,268	$	11,771,679	$	90,124	$	103,334	$	128,633	$	13,133,160	$	12,896,602	$	11,900,312

(1) PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. See Note 6 - Loans for further discussion of these purchased loans.

A summary of activity in the allowance for credit losses by loan portfolio (excluding covered loans) for the three ended March 31, 2014 and 2013 is as follows:

Three months ended March 31, 2014				Commercial Real-estate						Residential Real-estate			Premium Finance Receivable			Consumer and Other			Total, Excluding Covered Loans
(Dollars in thousands)	Commercial						Home Equity
Allowance for credit losses
Allowance for loan losses at beginning of period	$	23,092		$	48,658		$	12,611		$	5,108		$	5,583		$	1,870		$	96,922
Other adjustments	(15		)	(121		)	(1		)	(2		)	(9		)	—			(148		)
Reclassification from (to) allowance for unfunded lending-related commitments	—			(18		)	—			—			—			—			(18		)
Charge-offs	(648		)	(4,493		)	(2,267		)	(226		)	(1,210		)	(173		)	(9,017		)
Recoveries	317			145			257			131			321			61			1,232
Provision for credit losses	1,943			434			366			(320		)	897			(16		)	3,304
Allowance for loan losses at period end	$	24,689		$	44,605		$	10,966		$	4,691		$	5,582		$	1,742		$	92,275
Allowance for unfunded lending-related commitments at period end	$	—		$	737		$	—		$	—		$	—		$	—		$	737
Allowance for credit losses at period end	$	24,689		$	45,342		$	10,966		$	4,691		$	5,582		$	1,742		$	93,012
Individually evaluated for impairment	3,107			4,041			596			455			—			95			8,294
Collectively evaluated for impairment	21,512			41,301			10,370			4,147			5,582			1,647			84,559
Loans acquired with deteriorated credit quality	70			—			—			89			—			—			159
Loans at period end
Individually evaluated for impairment	$	18,350		$	99,480		$	7,537		$	18,026		$	—		$	1,592		$	144,985
Collectively evaluated for impairment	3,410,011			4,087,171			700,211			405,668			3,724,493			157,662			12,485,216
Loans acquired with deteriorated credit quality	10,836			75,604			—			3,075			413,202			242			502,959

Three months ended March 31, 2013				Commercial Real-estate						Residential Real-estate			Premium Finance Receivable			Consumer and Other			Total, Excluding Covered Loans
(Dollars in thousands)	Commercial						Home Equity
Allowance for credit losses
Allowance for loan losses at beginning of period	$	28,794		$	52,135		$	12,734		$	5,560		$	6,096		$	2,032		$	107,351
Other adjustments	(3		)	(217		)	—			(9		)	—			—			(229		)
Reclassification from (to) allowance for unfunded lending-related commitments	—			(213		)	—			—			—			—			(213		)
Charge-offs	(4,540		)	(3,299		)	(2,397		)	(1,728		)	(1,068		)	(129		)	(13,161		)
Recoveries	295			368			162			5			294			109			1,233
Provision for credit losses	4,406			7,634			1,623			1,312			749			(357		)	15,367
Allowance for loan losses at period end	$	28,952		$	56,408		$	12,122		$	5,140		$	6,071		$	1,655		$	110,348
Allowance for unfunded lending-related commitments at period end	$	—		$	15,287		$	—		$	—		$	—		$	—		$	15,287
Allowance for credit losses at period end	$	28,952		$	71,695		$	12,122		$	5,140		$	6,071		$	1,655		$	125,635
Individually evaluated for impairment	3,682			23,089			1,748			598			—			156			29,273
Collectively evaluated for impairment	25,270			48,409			10,374			4,532			6,071			1,499			96,155
Loans acquired with deteriorated credit quality	—			197			—			10			—			—			207
Loans at period end
Individually evaluated for impairment	$	27,447		$	145,203		$	16,057		$	12,984		$	—		$	1,863		$	203,554
Collectively evaluated for impairment	2,840,405			3,790,445			743,161			346,835			3,250,941			162,109			11,133,896
Loans acquired with deteriorated credit quality	4,843			54,817			—			833			499,731			2,638			562,862

A summary of activity in the allowance for covered loan losses for the three months ended March 31, 2014 and 2013 is as follows:

	Three Months Ended
	March 31,			March 31,
(Dollars in thousands)	2014			2013
Balance at beginning of period	$	10,092		$	13,454
Provision for covered loan losses before benefit attributable to FDIC loss share agreements	(7,121		)	1,600
Benefit attributable to FDIC loss share agreements	5,697			(1,280		)
Net provision for covered loan losses	(1,424		)	320
(Decrease) increase in FDIC indemnification asset	(5,697		)	1,280
Loans charged-off	(2,864		)	(2,791		)
Recoveries of loans charged-off	3,340			9
Net recoveries (charge-offs)	476			(2,782		)
Balance at end of period	$	3,447		$	12,272

In conjunction with FDIC-assisted transactions, the Company entered into loss share agreements with the FDIC. Additional expected losses, to the extent such expected losses result in the recognition of an allowance for loan losses, will increase the FDIC indemnification asset. The allowance for loan losses for loans acquired in FDIC-assisted transactions is determined without giving consideration to the amounts recoverable through loss share agreements (since the loss share agreements are separately accounted for and thus presented “gross” on the balance sheet). On the Consolidated Statements of Income, the provision for credit losses related to covered loans is reported net of changes in the amount recoverable under the loss share agreements. Reductions to expected losses, to the extent such reductions to expected losses are the result of an improvement to the actual or expected cash flows from the covered assets, will reduce the FDIC indemnification asset. Additions to expected losses will require an increase to the allowance for loan losses, and a corresponding increase to the FDIC indemnification asset. See “FDIC-Assisted Transactions” within Note 3 – Business Combinations for more detail.

Impaired Loans

A summary of impaired loans, including troubled debt restructurings ("TDRs"), is as follows:

	March 31,		December 31,		March 31,
(Dollars in thousands)	2014		2013		2013
Impaired loans (included in non-performing and TDRs):
Impaired loans with an allowance for loan loss required (1)	$	86,381	$	92,184	$	101,565
Impaired loans with no allowance for loan loss required	56,596		70,045		101,989
Total impaired loans (2)	$	142,977	$	162,229	$	203,554
Allowance for loan losses related to impaired loans	$	8,197	$	8,265	$	14,607
TDRs	$	92,517	$	107,103	$	116,345

(1) These impaired loans require an allowance for loan losses because the estimated fair value of the loans or related collateral is less than the recorded investment in the loans.

(2) Impaired loans are considered by the Company to be non-accrual loans, TDRs or loans with principal and/or interest at risk, even if theloan is current with all payments of principal and interest.

The following tables present impaired loans evaluated for impairment by loan class for the periods ended as follows:

							For the Three Months Ended
	As of March 31, 2014						March 31, 2014
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
(Dollars in thousands)
Impaired loans with a related ASC 310 allowance recorded
Commercial
Commercial and industrial	$	9,167	$	10,029	$	2,459	$	9,340	$	120
Franchise	—		—		—		—		—
Mortgage warehouse lines of credit	—		—		—		—		—
Community Advantage—homeowners association	—		—		—		—		—
Aircraft	—		—		—		—		—
Asset-based lending	670		2,465		620		677		31
Tax exempt	—		—		—		—		—
Leases	—		—		—		—		—
Other	—		—		—		—		—
Commercial real-estate
Residential construction	—		—		—		—		—
Commercial construction	3,099		3,099		24		3,099		28
Land	9,260		9,625		174		9,688		79
Office	8,712		9,398		1,069		8,767		90
Industrial	6,597		6,765		513		5,985		81
Retail	12,763		12,903		826		12,819		132
Multi-family	2,053		2,143		122		2,057		23
Mixed use and other	25,420		25,591		1,272		25,853		291
Home equity	2,109		2,534		596		2,117		24
Residential real-estate	6,222		6,362		427		6,094		68
Premium finance receivables
Commercial insurance	—		—		—		—		—
Life insurance	—		—		—		—		—
PCI - life insurance	—		—		—		—		—
Consumer and other	309		367		95		290		5
Impaired loans with no related ASC 310 allowance recorded
Commercial
Commercial and industrial	$	7,789	$	14,415	$	—	$	8,179	$	208
Franchise	—		—		—		—		—
Mortgage warehouse lines of credit	—		—		—		—		—
Community Advantage—homeowners association	—		—		—		—		—
Aircraft	—		—		—		—		—
Asset-based lending	—		—		—		—		—
Tax exempt	—		—		—		—		—
Leases	—		—		—		—		—
Other	—		—		—		—		—
Commercial real-estate
Residential construction	891		891		—		1,245		12
Commercial construction	1,466		1,471		—		1,418		17
Land	4,982		8,764		—		4,985		109
Office	6,260		6,301		—		6,266		83
Industrial	2,298		2,470		—		2,314		47
Retail	10,419		12,273		—		11,006		140
Multi-family	1,078		2,013		—		1,201		23
Mixed use and other	3,161		5,044		—		3,096		67
Home equity	5,428		7,044		—		5,777		73
Residential real-estate	11,541		14,427		—		11,699		137
Premium finance receivables
Commercial insurance	—		—		—		—		—
Life insurance	—		—		—		—		—
PCI - life insurance	—		—		—		—		—
Consumer and other	1,283		1,809		—		1,285		27
Total loans, net of unearned income, excluding covered loans	$	142,977	$	168,203	$	8,197	$	145,257	$	1,915

							For the Twelve Months Ended
	As of December 31, 2013						December 31, 2013
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
(Dollars in thousands)
Impaired loans with a related ASC 310 allowance recorded
Commercial
Commercial and industrial	$	6,297	$	7,001	$	1,078	$	6,611	$	354
Franchise	—		—		—		—		—
Mortgage warehouse lines of credit	—		—		—		—		—
Community Advantage—homeowners association	—		—		—		—		—
Aircraft	—		—		—		—		—
Asset-based lending	282		294		282		295		14
Tax exempt	—		—		—		—		—
Leases	—		—		—		—		—
Other	—		—		—		—		—
Commercial real-estate
Residential construction	—		—		—		—		—
Commercial construction	3,099		3,099		18		3,098		115
Land	10,518		11,871		259		10,323		411
Office	7,792		8,444		1,253		8,148		333
Industrial	3,385		3,506		193		3,638		179
Retail	17,511		17,638		1,253		17,678		724
Multi-family	3,237		3,730		235		2,248		139
Mixed use and other	28,935		29,051		1,366		26,792		1,194
Home equity	3,985		5,238		1,593		4,855		236
Residential real-estate	6,876		7,023		626		6,335		273
Premium finance receivables
Commercial insurance	—		—		—		—		—
Life insurance	—		—		—		—		—
Purchased life insurance	—		—		—		—		—
Consumer and other	267		269		109		273		11
Impaired loans with no related ASC 310 allowance recorded
Commercial
Commercial and industrial	$	9,890	$	16,333	$	—	$	13,928	$	1,043
Franchise	—		—		—		—		—
Mortgage warehouse lines of credit	—		—		—		—		—
Community Advantage—homeowners association	—		—		—		—		—
Aircraft	—		—		—		—		—
Asset-based lending	354		2,311		—		2,162		121
Tax exempt	—		—		—		—		—
Leases	—		—		—		—		—
Other	—		—		—		—		—
Commercial real-estate
Residential construction	1,463		1,530		—		1,609		64
Commercial construction	7,710		13,227		—		9,680		722
Land	5,035		8,813		—		5,384		418
Office	10,379		11,717		—		10,925		610
Industrial	5,087		5,267		—		5,160		328
Retail	7,047		8,610		—		8,462		400
Multi-family	608		1,030		—		903		47
Mixed use and other	4,077		6,213		—		5,046		352
Home equity	6,312		7,790		—		6,307		324
Residential real-estate	10,761		13,585		—		9,443		393
Premium finance receivables
Commercial insurance	—		—		—		—		—
Life insurance	—		—		—		—		—
Purchased life insurance	—		—		—		—		—
Consumer and other	1,322		1,865		—		1,355		115
Total loans, net of unearned income, excluding covered loans	$	162,229	$	195,455	$	8,265	$	170,658	$	8,920

							For the Three Months Ended
	As of March 31, 2013						March 31, 2013
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
(Dollars in thousands)
Impaired loans with a related ASC 310 allowance recorded
Commercial
Commercial and industrial	$	12,827	$	14,544	$	3,627	$	13,034	$	230
Franchise	—		—		—		—		—
Mortgage warehouse lines of credit	—		—		—		—		—
Community Advantage—homeowners association	—		—		—		—		—
Aircraft	—		—		—		—		—
Asset-based lending	511		511		55		511		7
Tax exempt	—		—		—		—		—
Leases	—		—		—		—		—
Other	—		—		—		—		—
Commercial real-estate
Residential construction	1,881		2,007		405		1,976		23
Commercial construction	8,682		8,682		49		8,983		86
Land	17,851		19,070		2,380		17,861		104
Office	5,792		5,996		659		5,853		61
Industrial	4,229		4,286		1,241		4,244		65
Retail	16,734		17,316		674		16,773		194
Multi-family	3,966		4,063		152		4,044		42
Mixed use and other	18,910		20,337		2,863		19,317		232
Home equity	5,160		5,751		1,748		5,488		57
Residential real-estate	4,357		4,974		598		4,365		49
Premium finance receivables
Commercial insurance	—		—		—		—		—
Life insurance	—		—		—		—		—
Purchased life insurance	—		—		—		—		—
Consumer and other	665		665		156		665		8
Impaired loans with no related ASC 310 allowance recorded
Commercial
Commercial and industrial	$	13,963	$	17,153	$	—	$	14,344	$	226
Franchise	125		1,544		—		1,189		26
Mortgage warehouse lines of credit	—		—		—		—		—
Community Advantage—homeowners association	—		—		—		—		—
Aircraft	—		—		—		—		—
Asset-based lending	21		1,358		—		23		18
Tax exempt	—		—		—		—		—
Leases	—		—		—		—		—
Other	—		—		—		—		—
Commercial real-estate
Residential construction	3,208		3,579		—		3,708		42
Commercial construction	3,970		4,450		—		4,016		49
Land	11,305		16,304		—		12,048		203
Office	8,283		8,357		—		8,306		95
Industrial	5,541		5,653		—		5,563		74
Retail	14,483		15,095		—		14,628		172
Multi-family	2,200		4,541		—		2,618		54
Mixed use and other	18,168		19,483		—		18,345		269
Home equity	10,897		13,179		—		11,395		131
Residential real-estate	8,627		9,053		—		8,703		94
Premium finance receivables
Commercial insurance	—		—		—		—		—
Life insurance	—		—		—		—		—
Purchased life insurance	—		—		—		—		—
Consumer and other	1,198		1,664		—		1,208		25
Total loans, net of unearned income, excluding covered loans	$	203,554	$	229,615	$	14,607	$	209,208	$	2,636

TDRs

At March 31, 2014, the Company had $92.5 million in loans modified in TDRs. The $92.5 million in TDRs represents 143 credits in which economic concessions were granted to certain borrowers to better align the terms of their loans with their current ability to pay.

The Company’s approach to restructuring loans, excluding PCI loans, is built on its credit risk rating system which requires credit management personnel to assign a credit risk rating to each loan. In each case, the loan officer is responsible for recommending a credit risk rating for each loan and ensuring the credit risk ratings are appropriate. These credit risk ratings are then reviewed and approved by the bank’s chief credit officer and/or concurrence credit officer. Credit risk ratings are determined by evaluating a number of factors including a borrower’s financial strength, cash flow coverage, collateral protection and guarantees. The Company’s credit risk rating scale is one through ten with higher scores indicating higher risk. In the case of loans rated six or worse following modification, the Company’s Managed Assets Division evaluates the loan and the credit risk rating and determines that the loan has been restructured to be reasonably assured of repayment and of performance according to the modified terms and is supported by a current, well-documented credit assessment of the borrower’s financial condition and prospects for repayment under the revised terms.

A modification of a loan, excluding PCI loans, with an existing credit risk rating of six or worse or a modification of any other credit which will result in a restructured credit risk rating of six or worse, must be reviewed for possible TDR classification. In that event, our Managed Assets Division conducts an overall credit and collateral review. A modification of these loans is considered to be a TDR if both (1) the borrower is experiencing financial difficulty and (2) for economic or legal reasons, the bank grants a concession to a borrower that it would not otherwise consider. The modification of a loan, excluding PCI loans, where the credit risk rating is five or better both before and after such modification is not considered to be a TDR. Based on the Company’s credit risk rating system, it considers that borrowers whose credit risk rating is five or better are not experiencing financial difficulties and therefore, are not considered TDRs.

All credits determined to be a TDR will continue to be classified as a TDR in all subsequent periods, unless the borrower has been in compliance with the loan’s modified terms for a period of six months (including over a calendar year-end) and the modified interest rate represented a market rate at the time of a restructuring. The Managed Assets Division, in consultation with the respective loan officer, determines whether the modified interest rate represented a current market rate at the time of restructuring. Using knowledge of current market conditions and rates, competitive pricing on recent loan originations, and an assessment of various characteristics of the modified loan (including collateral position and payment history), an appropriate market rate for a new borrower with similar risk is determined. If the modified interest rate meets or exceeds this market rate for a new borrower with similar risk, the modified interest rate represents a market rate at the time of restructuring. Additionally, before removing a loan from TDR classification, a review of the current or previously measured impairment on the loan and any concerns related to future performance by the borrower is conducted. If concerns exist about the future ability of the borrower to meet its obligations under the loans based on a credit review by the Managed Assets Division, the TDR classification is not removed from the loan. Loans classified as TDRs that are re-modified subsequent to the initial determination will continue to be classified as TDRs following the re-modification, unless the requirements for removal from TDR classification discussed above are satisfied at the time of the re-modification.

TDRs are reviewed at the time of the modification and on a quarterly basis to determine if a specific reserve is necessary. The carrying amount of the loan is compared to the expected payments to be received, discounted at the loan's original rate, or for collateral dependent loans, to the fair value of the collateral. Any shortfall is recorded as a specific reserve. The Company, in accordance with ASC 310-10, continues to individually measure impairment of these loans after the TDR classification is removed.

Each TDR was reviewed for impairment at March 31, 2014 and approximately $4.0 million of impairment was present and appropriately reserved for through the Company’s normal reserving methodology in the Company’s allowance for loan losses. For TDRs in which impairment is calculated by the present value of future cash flows, the Company records interest income representing the decrease in impairment resulting from the passage of time during the respective period, which differs from interest income from contractually required interest on these specific loans.  During the three months ended March 31, 2014 and 2013, the Company recorded $132,000 and $229,000, respectively, in interest income representing this decrease in impairment.

The tables below present a summary of the post-modification balance of loans restructured during the three months ended March 31, 2014 and 2013, respectively, which represent TDRs:

Three months ended March 31, 2014 (Dollars in thousands)	Total (1)(2)			Extension at Below Market Terms (2)			Reduction of Interest Rate (2)			Modification to  Interest-only Payments (2)			Forgiveness of Debt(2)
	Count	Balance		Count	Balance		Count	Balance		Count	Balance		Count	Balance
Commercial
Commercial and industrial	1	$	88	1	$	88	—	$	—	1	$	88	—	$	—
Commercial real-estate
Land	—	—		—	—		—	—		—	—		—	—
Industrial	1	1,078		1	1,078		—	—		1	1,078		—	—
Retail	1	202		1	202		—	—		—	—		—	—
Multi-family	—	—		—	—		—	—		—	—		—	—
Mixed use and other	3	3,877		2	2,604		3	3,877		1	1,273		—	—
Residential real estate and other	—	—		—	—		—	—		—	—		—	—
Total loans	6	$	5,245	5	$	3,972	3	$	3,877	3	$	2,439	—	$	—

Three months ended March 31, 2013 (Dollars in thousands)	Total (1)(2)			Extension at Below Market Terms (2)			Reduction of Interest Rate (2)			Modification to  Interest-only Payments (2)			Forgiveness of Debt(2)
	Count	Balance		Count	Balance		Count	Balance		Count	Balance		Count	Balance
Commercial
Commercial and industrial	6	$	708	5	$	573	4	$	553	2	$	185	—	$	—
Commercial real-estate
Land	2	287		2	287		2	287		—	—		1	73
Industrial	—	—		—	—		—	—		—	—		—	—
Retail	1	200		1	200		1	200		—	—		—	—
Multi-family	1	705		1	705		1	705		—	—		—	—
Mixed use and other	—	—		—	—		—	—		—	—		—	—
Residential real estate and other	4	377		2	70		3	361		1	123		—	—
Total loans	14	$	2,277	11	$	1,835	11	$	2,106	3	$	308	1	$	73

(1) TDRs may have more than one modification representing a concession. As such, TDRs during the period may be represented in more than one of the categories noted above.

(2) Balances represent the recorded investment in the loan at the time of the restructuring.

During the three months ended March 31, 2014, six loans totaling $5.2 million were determined to be TDRs, compared to 14 loans totaling $2.3 million in the same period of 2013. Of these loans extended at below market terms, the weighted average extension had a term of approximately 13 months during the three months ended March 31, 2014 compared to 21 months for the same period of 2013. Further, the weighted average decrease in the stated interest rate for loans with a reduction of interest rate during the period was approximately 176 basis points and 153 basis points during the three months ending March 31, 2014 and 2013, respectively. Interest-only payment terms were approximately nine months during the three months ending March 31, 2014 compared to approximately eight months during the three months ending March 31, 2013. Additionally, no principal balances were forgiven in the first quarter of 2014 compared to $50,000 of principal balances forgiven during the same period of 2013.

The following table presents a summary of all loans restructured in TDRs during the twelve months ended March 31, 2014 and 2013, and such loans which were in payment default under the restructured terms during the respective periods below:

(Dollars in thousands)	Three Months Ended March 31, 2014						Three Months Ended March 31, 2013
	Total (1)(3)			Payments in Default  (2)(3)			Total (1)(3)			Payments in Default  (2)(3)
	Count	Balance		Count	Balance		Count	Balance		Count	Balance
Commercial
Commercial and industrial	1	$	88	—	$	—	21	$	14,901	6	$	10,377
Commercial real-estate
Residential construction	—	—		—	—		3	2,147		—	—
Commercial construction	3	6,120		3	6,120		—	—		—	—
Land	1	2,352		—	—		5	4,131		1	651
Office	4	4,021		3	3,465		—	—		—	—
Industrial	2	2,027		—	—		1	727		—	—
Retail	1	202		—	—		4	5,085		—	—
Multi-family	—	—		—	—		2	1,085		1	705
Mixed use and other	9	8,919		2	399		12	6,061		4	2,603
Residential real estate and other	6	1,919		—	—		10	969		2	221
Total loans	27	$	25,648	8	$	9,984	58	$	35,106	14	$	14,557

(1) Total TDRs represent all loans restructured in TDRs during the previous twelve months from the date indicated.

(2) TDRs considered to be in payment default are over 30 days past-due subsequent to the restructuring.

(3) Balances represent the recorded investment in the loan at the time of the restructuring.