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FAIR VALUE MEASUREMENT AND FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)
 6 Months Ended
Jun. 30, 2015
FAIR VALUE MEASUREMENT AND FAIR VALUE OF FINANCIAL INSTRUMENTS  
Assets (Liabilities) Measured at Fair Value on a Recurring Basis
Assets (Liabilities) Measured at Fair Value on a Recurring Basis
as of June 30, 2015
($ in thousands)
Fair Value Measurements June 30, 2015
Quoted Prices in Active Markets for Identical Assets
(Level 1)
Significant
Other Observable Inputs
(Level 2)
Significant
Unobservable Inputs
(Level 3)
Available-for-sale investment securities:
 

 

 

 

U.S. Treasury securities
$
1,200,111

$
1,200,111

$
—

$
—

U.S. government agency and U.S. government sponsored enterprise debt securities
424,863

—

424,863

—

U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities:
 

 

 

Commercial mortgage-backed securities
187,388

—

187,388

—

Residential mortgage-backed securities
688,712

—

688,712

—

Municipal securities
206,422

—

206,422

—

Other residential mortgage-backed securities:
 

 

 

Investment grade
61,908

—

61,908

—

Corporate debt securities:
 

 

 

Investment grade
156,978

—

156,978

—

Non-investment grade
10,025

—

10,025

—

Other securities
45,739

35,534

10,205

—

Total available-for-sale investment securities
$
2,982,146

$
1,235,645

$
1,746,501

$
—

Derivative assets:
Interest rate swaps and caps
$
44,424

$
—

$
44,424

$
—

Foreign exchange contracts
$
11,044

$
—

$
11,044

$
—

Derivative liabilities:
Interest rate swaps on certificates of deposit
$
(8,177
)
$
—

$
(8,177
)
$
—

Interest rate swaps and caps
$
(43,810
)
$
—

$
(43,810
)
$
—

Foreign exchange contracts
$
(10,186
)
$
—

$
(10,186
)
$
—



Assets (Liabilities) Measured at Fair Value on a Recurring Basis
as of December 31, 2014
($ in thousands)
Fair Value Measurements December 31, 2014
Quoted Prices in Active Markets for Identical Assets
(Level 1)
Significant
Other Observable Inputs
(Level 2)
Significant
Unobservable Inputs
(Level 3)
Available-for-sale investment securities:
 

 

 

 

U.S. Treasury securities
$
873,435

$
873,435

$
—

$
—

U.S. government agency and U.S. government sponsored enterprise debt securities
311,024

—

311,024

—

U.S. government agency and U.S. government sponsored enterprise mortgage-backed securities:
 

 

 

Commercial mortgage-backed securities
141,420

—

141,420

—

Residential mortgage-backed securities
791,088

—

791,088

—

Municipal securities
250,448

—

250,448

—

Other residential mortgage-backed securities:
 

 

 

Investment grade
53,918

—

53,918

—

Other commercial mortgage-backed securities:
 

 

 

Investment grade
34,053

—

34,053

—

Corporate debt securities:
 

 

 

Investment grade
115,182

—

115,182

—

Non-investment grade
14,681

—

8,153

6,528

Other securities
41,116

32,105

9,011

—

Total available-for-sale investment securities
$
2,626,365

$
905,540

$
1,714,297

$
6,528

Derivative assets:
Foreign exchange options
$
6,136

$
—

$
6,136

$
—

Interest rate swaps and caps
$
41,534

$
—

$
41,534

$
—

Foreign exchange contracts
$
8,118

$
—

$
8,118

$
—

Derivative liabilities:
Interest rate swaps on certificates of deposit
$
(9,922
)
$
—

$
(9,922
)
$
—

Interest rate swaps and caps
$
(41,779
)
$
—

$
(41,779
)
$
—

Foreign exchange contracts
$
(9,163
)
$
—

$
(9,163
)
$
—

Embedded derivative liabilities
$
(3,392
)
$
—

$
—

$
(3,392
)

Reconciliation of assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs
Three Months Ended June 30,
2015
2014
($ in thousands)
Corporate Debt Securities:
Non-Investment Grade
Embedded Derivative
Liabilities
Corporate Debt Securities:
Non-Investment Grade
Embedded Derivative
Liabilities
Beginning balance, April 1
$
—

$
(3,412
)
$
6,717

$
(3,398
)
Total gains for the period:
 

 

 

 

Included in earnings(1)
—

—

—

36

Included in other comprehensive income (unrealized)(2)
—

—

1,209

—

Purchases, issues, sales, settlements:
 

 

Purchases
—

—

—

—

Issues
—

—

—

—

Sales
—

—

—

—

Settlements
—

3,412

(9
)
—

Transfer from investment grade to non-investment grade
—

—

—

—

Transfers in and/or out of Level 3
—

—

—

—

Ending balance, June 30
$
—

$
—

$
7,917

$
(3,362
)
Changes in unrealized gains included in earnings relating to assets and liabilities held at the end of June 30
$
—

$
—

$
—

$
(36
)
Six Months Ended June 30,
2015
2014
($ in thousands)
Corporate Debt Securities:
Non-Investment Grade
Embedded Derivative
Liabilities
Corporate Debt Securities:
Non-Investment Grade
Embedded Derivative
Liabilities
Beginning balance, January 1
$
6,528

$
(3,392
)
$
6,371

$
(3,655
)
Total gains or (losses) for the period:
 

 

 

Included in earnings(1)
960

(20
)


293

Included in other comprehensive income (unrealized)(2)
922

—

1,643

—

Purchases, issues, sales, settlements:
 

 

Purchases
—

—

—

—

Issues
—

—

—

—

Sales
(7,219
)
—

—

—

Settlements
(98
)
3,412

(97
)
—

Transfer from investment grade to non-investment grade
—

—

—

—

Transfers in and/or out of Level 3
(1,093
)
—

—

—

Ending balance, June 30
$
—

$
—

$
7,917

$
(3,362
)
Changes in unrealized gains included in earnings relating to assets and liabilities held at the end of June 30
$
—

$
—

$
—

$
(293
)
(1)
Realized gains or losses of corporate debt securities and embedded derivative liabilities are included in net gains on sales of investment securities and other operating expense, respectively, in the consolidated statements of income.
(2)
Unrealized gains or losses on available-for-sale investment securities are reported in other comprehensive income, net of tax, in the consolidated statements of comprehensive income.
 
Assets Measured at Fair Value on a Nonrecurring Basis
 
Assets Measured at Fair Value on a Nonrecurring Basis
as of June 30, 2015
($ in thousands)
Fair Value
Measurements
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
Significant
Other Observable Inputs
(Level 2)
Significant Unobservable Inputs
(Level 3)
Non-PCI impaired loans:
 

 

 

 

Commercial Real Estate (“CRE”)
$
14,641

$
—

$
—

$
14,641

Commercial and Industrial (“C&I”)
43,138

—

—

43,138

Residential
15,104

—

—

15,104

Consumer
608

—

—

608

Total non-PCI impaired loans
$
73,491

$
—

$
—

$
73,491

OREO
$
3,848

$
—

$
—

$
3,848

Loans held for sale
$
33,719

$
—

$
33,719

$
—


 
Assets Measured at Fair Value on a Nonrecurring Basis
as of December 31, 2014
($ in thousands)
Fair Value
Measurements
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Non-PCI impaired loans:
 

 

 

 

CRE
$
26,089

$
—

$
—

$
26,089

C&I
16,581

—

—

16,581

Residential
25,034

—

—

25,034

Consumer
107

—

—

107

Total non-PCI impaired loans
$
67,811

$
—

$
—

$
67,811

OREO
$
17,521

$
—

$
—

$
17,521


Summary of increase (decrease) in value of certain assets for which a nonrecurring fair value adjustment has been recognized
Three Months Ended June 30,
Six Months Ended June 30,
($ in thousands)
2015
2014
2015
2014
Non-PCI impaired loans:
 

 

 

 

CRE
$
(445
)
$
1,865

$
(905
)
$
1,376

C&I
(6,454
)
(9,642
)
(9,303
)
(11,705
)
Residential
(216
)
413

(341
)
27

Consumer
(1
)
—

(1
)
—

Total non-PCI impaired loans
$
(7,116
)
$
(7,364
)
$
(10,550
)
$
(10,302
)
OREO
$
(200
)
$
(69
)
$
(258
)
$
(595
)
Loans held for sale
$
(517
)
$
—

$
(517
)
$
—


Carrying amounts and fair values of financial instruments
 
June 30, 2015
($ in thousands)
Carrying
Amount
Level 1
Level 2
Level 3
Estimated
Fair Value
Financial Assets:
 

 

 

 

 

Cash and cash equivalents
$
1,877,914

$
1,877,914

$
—

$
—

$
1,877,914

Short-term investments
$
274,838

$
—

$
274,838

$
—

$
274,838

Securities purchased under resale agreements (“resale agreements”)
$
1,100,000

$
—

$
1,091,775

$
—

$
1,091,775

Loans held for sale
$
195,427

$
—

$
197,813

$
—

$
197,813

Loans receivable, net
$
21,697,435

$
—

$
—

$
21,460,209

$
21,460,209

Investment in Federal Home Loan Bank (“FHLB”) stock
$
18,155

$
—

$
18,155

$
—

$
18,155

Investment in Federal Reserve Bank stock
$
54,675

$
—

$
54,675

$
—

$
54,675

Accrued interest receivable
$
81,575

$
—

$
81,575

$
—

$
81,575

Financial Liabilities:
 

 

 

 

 

Customer deposit accounts:
 

 

 

 

 

Demand, savings and money market deposits
$
18,872,270

$
—

$
18,872,270

$
—

$
18,872,270

Time deposits
$
6,655,950

$
—

$
6,640,165

$
—

$
6,640,165

Short-term borrowings
$
3,271

$
—

$
3,271

$
—

$
3,271

FHLB advances
$
318,322

$
—

$
334,284

$
—

$
334,284

Securities sold under repurchase agreements (“repurchase agreements”)
$
400,000

$
—

$
388,498

$
—

$
388,498

Accrued interest payable
$
10,762

$
—

$
10,762

$
—

$
10,762

Long-term debt
$
215,964

$
—

$
193,157

$
—

$
193,157



 
December 31, 2014
($ in thousands)
Carrying
Amount
Level 1
Level 2
Level 3
Estimated
Fair Value
Financial Assets:
 

 

 

 

 

Cash and cash equivalents
$
1,039,885

$
1,039,885

$
—

$
—

$
1,039,885

Short-term investments
$
338,714

$
—

$
338,714

$
—

$
338,714

Resale agreements
$
1,225,000

$
—

$
1,191,060

$
—

$
1,191,060

Loans held for sale
$
45,950

$
—

$
45,950

$
—

$
45,950

Loans receivable, net
$
21,468,270

$
—

$
—

$
20,997,379

$
20,997,379

Investment in FHLB stock
$
31,239

$
—

$
31,239

$
—

$
31,239

Investment in Federal Reserve Bank stock
$
54,451

$
—

$
54,451

$
—

$
54,451

Accrued interest receivable
$
88,303

$
—

$
88,303

$
—

$
88,303

Financial Liabilities:
 

 

 

 

 

Customer deposit accounts:
 

 

 

 

 

Demand, savings and money market deposits
$
17,896,035

$
—

$
17,896,035

$
—

$
17,896,035

Time deposits
$
6,112,739

$
—

$
6,095,217

$
—

$
6,095,217

FHLB advances
$
317,241

$
—

$
336,302

$
—

$
336,302

Repurchase agreements
$
795,000

$
—

$
870,434

$
—

$
870,434

Accrued interest payable
$
11,303

$
—

$
11,303

$
—

$
11,303

Long-term debt
$
225,848

$
—

$
205,777

$
—

$
205,777


Fair Value, Measurements, Recurring  
Quantitative information  
Schedule of quantitative information about significant unobservable inputs used in the valuation of assets and liabilities classified as Level 3
($ in thousands)
Fair Value
Measurements
(Level 3)
Valuation
Technique(s)
Unobservable
Input(s)
Range of 
Inputs
Weighted
 Average
December 31, 2014
 

 
 
 
 
Available-for-sale investment securities:
 
 
 
 
Corporate debt securities:
 

 
 
 
 
Non-investment grade
$
6,528

Discounted cash flow
Constant prepayment rate
0.00% - 1.00%
0.73%
 
 

 
Constant default rate
0.75% - 1.20%
0.87%
 
 

 
Loss severity
85.00%
85.00%
 
 

 
Discount margin
4.50% - 7.50%
6.94%
Embedded derivative liabilities
$
(3,392
)
Discounted cash flow
Credit risk
0.12% - 0.14%
0.13%

Fair Value, Measurements, Nonrecurring  
Quantitative information  
Schedule of quantitative information about significant unobservable inputs used in the valuation of assets and liabilities classified as Level 3
($ in thousands)
Fair Value
Measurements
(Level 3)
Valuation
Technique(s)
Unobservable
Input(s)
Range of 
Inputs
Weighted 
Average
June 30, 2015
 

 
 
 
 
Non-PCI impaired loans
$
34,095

Discounted cash flow
Discount rate
0% - 89%
33%
$
39,396

Market comparables
Discount rate (1)
0% - 100%
17%
OREO
$
3,848

Appraisal
Selling cost
8%
8%
December 31, 2014
 

 
 
 
 
Non-PCI impaired loans
$
11,499

Discounted cash flow
Discount rate
0% - 81%
49%
$
56,312

Market comparables
Discount rate (1)
0% - 100%
4%
OREO
$
17,521

Appraisal
Selling cost
8%
8%
(1)
Discount rate is adjusted for factors such as liquidation cost of collateral and selling costs.