NOTE 13 — STOCKHOLDERS’ EQUITY

Series A Preferred Stock Offering — In April 2008, the Company issued 200,000 shares of 8% Non-Cumulative Perpetual Convertible Preferred Stock, Series A (“Series A”), with a liquidation preference of $1,000 per share. The Company received $194.1 million of additional Tier 1 qualifying capital, after deducting stock issuance costs. On May 1, 2013, the Company exercised its mandatory conversion right related to all the outstanding shares of its Series A preferred stock. At the conversion date, the remaining 85,710 shares of outstanding Series A Preferred Stock were converted to 5,594,080 shares of common stock.

Stock Repurchase Program — On January 23, 2013, the Company’s Board of Directors authorized a stock repurchase program to buy back up to $200.0 million of the Company’s common stock. As of June 30, 2013, the Company completed the authorized repurchase program, repurchasing 8,026,807 shares at a weighted average price of $24.89 per share and a total cost of $200.0 million. In comparison, the Company repurchased 9,068,105 shares at a weighted average price of $22.02 per share and a total cost of $199.9 million during the nine months ended September 30, 2012.

In addition, on July 17, 2013, the Company’s Board of Directors authorized a stock repurchase program to buy back up to $100.0 million of the Company’s common stock. The Company did not repurchase any shares during the three months ended September 30, 2013.

Quarterly Dividends — In July 2013, the Company’s Board of Directors also declared quarterly common stock cash dividends of $0.15 per share payable on or about August 15, 2013 to shareholders on record on July 31, 2013. Cash dividends totaling $20.8 million and $62.5 million were paid to the Company’s common shareholders during the three and nine months ended September 30, 2013.

Earnings Per Share (“EPS”) — The number of shares outstanding at September 30, 2013 was 137,739,423. The Company applies the two-class method of computing basic EPS. Under the two-class method, EPS is determined for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. The Company’s restricted stocks, which receive dividends as declared, qualify as participating securities. Restricted stock units issued by the Company are not considered participating securities, as they do not have dividend distribution rights during the vesting period. Diluted EPS is calculated on the basis of the weighted average number of shares outstanding during the period plus potential dilutive shares.

The following table sets forth earnings per share calculations for the three and nine months ended September 30, 2013 and 2012:

	Three Months Ended September 30, 2013
	Net Income			Number of Shares	Per Share Amounts
	(In thousands, except per share data)
Net income	$	73,157
Less:
Preferred stock dividends	—
Earnings allocated to participating securities	(372		)
Basic EPS — income allocated to common stockholders	$	72,785		137,036	$	0.53
Effect of dilutive securities:
Stock options	—			71
Restricted stock units	54			360
Convertible preferred stock	—			—
Diluted EPS — income allocated to common stockholders	$	72,839		137,467	$	0.53

	Three Months Ended September 30, 2012
	Net Income			Number of Shares	Per Share Amounts
	(In thousands, except per share data)
Net income	$	71,110
Less:
Preferred stock dividends	(1,714		)
Earnings allocated to participating securities	(798		)
Basic EPS — income available to common stockholders	$	68,598		139,621	$	0.49
Effect of dilutive securities:
Stock options	—			28
Restricted stock units	14			138
Convertible preferred stock	1,714			5,571
Diluted EPS — income available to common stockholders	$	70,326		145,358	$	0.48

	Nine Months Ended September 30, 2013
	Net Income			Number of Shares	Per Share Amounts
	(In thousands, except per share data)
Net income	$	219,263
Less:
Preferred stock dividends	(3,428		)
Earnings allocated to participating securities	(1,361		)
Basic EPS — income allocated to common stockholders	$	214,474		137,404	$	1.56
Effect of dilutive securities:
Stock options	—			66
Restricted stock units	124			276
Convertible preferred stock	3,428			2,453
Diluted EPS — income allocated to common stockholders	$	218,026		140,199	$	1.56

	Nine Months Ended September 30, 2012
	Net Income			Number of Shares	Per Share Amounts
	(In thousands, except per share data)
Net income	$	209,750
Less:
Preferred stock dividends	(5,142		)
Earnings allocated to participating securities	(2,518		)
Basic EPS — income available to common stockholders	$	202,090		142,348	$	1.42
Effect of dilutive securities:
Stock options	—			36
Restricted stock units	29			96
Convertible preferred stock	5,142			5,571
Diluted EPS — income available to common stockholders	$	207,261		148,051	$	1.40

The following average outstanding stock options and restricted stock units for the three and nine months ended September 30, 2013 and 2012, respectively, were excluded from the computation of diluted EPS because including them would have had an antidilutive effect.

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2013	2012	2013	2012
	(In thousands)
Stock options	145	320	191	350
Restricted stock units	3	5	10	5

Accumulated Other Comprehensive (Loss) Income — As of September 30, 2013, total accumulated other comprehensive loss was $25.2 million which includes the following components: net unrealized loss on securities available for sale of $25.2 million and unrealized gain on other investments of $48 thousand. As of December 31, 2012, total accumulated other comprehensive income was $4.7 million which includes the following components: net unrealized gain on securities available for sale of $4.6 million and unrealized gain on other asset investment of $26 thousand.

Activity in accumulated other comprehensive (loss) income, net of tax, for the nine months ended September 30, 2013 and 2012, was as follows:

	Unrealized (loss) gain on
	investment securities			Foreign currency			Unrealized gain on
	available-for-sale			translation adjustments			other investments		Total
	(In thousands)
Balance, December 31, 2011	$	(34,848	)	$	900		$	8	$	(33,940	)
Period Change	33,314			(900		)	9		32,423
Balance, September 30, 2012	$	(1,534	)	$	—		$	17	$	(1,517	)

Balance, December 31, 2012	$	4,643		$	—		$	26	$	4,669
Other comprehensive income before reclassifications	(22,905		)	—			22		(22,883		)
Amounts reclassified from AOCI	(6,964		)	—			—		(6,964		)
Net current period other comprehensive loss	(29,869		)	—			22		(29,847		)
Balance, September 30, 2013	$	(25,226	)	$	—		$	48	$	(25,178	)

Reclassifications out of accumulated other comprehensive income for the three and nine months ended September 30, 2013 was as follows:

	Amount Reclassified from
Details about Accumulated Other	Accumulated Other			Affected Line Item in the Statement
Comprehensive Income Components	Comprehensive Income			Where Net Income is Presented
	(In thousands)
Three Months Ended September 30, 2013
Investment securities available for sale
Realized net gains on sale of securities	$	1,084		Net gain on sales of investment securities
	1,084
	(455		)	Tax expense
Total reclassifications	$	629

Nine Months Ended September 30, 2013
Investment securities available for sale
Realized net gains on sale of securities	$	12,006		Net gain on sales of investment securities
	12,006
	(5,042		)	Tax expense
Total reclassifications	$	6,964

The following table sets forth the tax effects allocated to each component of other comprehensive income for the three and nine months ended September 30, 2013 and 2012:

				Tax
	Before-Tax			Expense			Net-of-Tax
	Amount			or Benefit			Amount
	(In thousands)
Three Months Ended September 30, 2013
Unrealized loss on investment securities available-for-sale:
Unrealized holding losses arising during period	$	(4,959	)	$	2,083		$	(2,876	)
Less: reclassification adjustment for gains included in income	(1,084		)	455			(629		)
Net unrealized loss	(6,043		)	2,538			(3,505		)
Noncredit-related impairment loss on securities	—			—			—
Unrealized gain on other investments	9			(4		)	5
Less: reclassification adjustment for gains included in income	—			—			—
Other comprehensive loss	$	(6,034	)	$	2,534		$	(3,500	)

				Tax
	Before-Tax			Expense			Net-of-Tax
	Amount			or Benefit			Amount
	(In thousands)
Three Months Ended September 30, 2012
Unrealized gain on investment securities available-for-sale:
Unrealized holding gains arising during period	$	26,474		$	(11,119	)	$	15,355
Less: reclassification adjustment for gains included in income	(93		)	39			(54		)
Net unrealized gain	26,381			(11,080		)	15,301
Noncredit-related impairment loss on securities	—			—			—
Foreign currency translation adjustments	(1,552		)	652			(900		)
Unrealized gain on other investments	9			(4		)	5
Less: reclassification adjustment for gains included in income	—			—			—
Other comprehensive income	$	24,838		$	(10,432	)	$	14,406

				Tax
	Before-Tax			Expense			Net-of-Tax
	Amount			or Benefit			Amount
	(In thousands)
Nine Months Ended September 30, 2013
Unrealized loss on investment securities available-for-sale:
Unrealized holding losses arising during period	$	(39,491	)	$	16,586		$	(22,905	)
Less: reclassification adjustment for gains included in income	(12,006		)	5,042			(6,964		)
Net unrealized loss	(51,497		)	21,628			(29,869		)
Noncredit-related impairment loss on securities	—			—			—
Unrealized gain on other investments	38			(16		)	22
Less: reclassification adjustment for gains included in income	—			—			—
Other comprehensive loss	$	(51,459	)	$	21,612		$	(29,847	)

				Tax
	Before-Tax			Expense			Net-of-Tax
	Amount			or Benefit			Amount
	(In thousands)
Nine Months Ended September 30, 2012
Unrealized gain on investment securities available-for-sale:
Unrealized gain on holding gains arising during period	$	63,150		$	(26,523	)	$	36,627
Less: reclassification adjustment for gains included in income	(647		)	272			(375		)
Net unrealized gain	62,503			(26,251		)	36,252
Noncredit-related impairment loss on securities	(5,066		)	2,128			(2,938		)
Foreign currency translation adjustments	(1,552		)	652			(900		)
Unrealized gain on other investments	41			(17		)	24
Less: reclassification adjustment for gains included in income	(25		)	10			(15		)
Other comprehensive income	$	55,901		$	(23,478	)	$	32,423