COVERED ASSETS AND FDIC INDEMNIFICATION ASSET (Tables)

3 Months Ended

Mar. 31, 2014

COVERED ASSETS AND FDIC INDEMNIFICATION ASSET

Carrying amounts and composition of covered loans

	March 31,			December 31,
	2014			2013
	(In thousands)
Real estate loans:
Residential single-family	$	276,330		$	290,095
Residential multifamily	374,252			403,508
Commercial and industrial real estate	1,031,161			1,103,530
Construction and land	110,130			163,833
Total real estate loans	1,791,873			1,960,966
Other loans:
Commercial business	395,718			426,621
Other consumer	72,368			73,973
Total other loans	468,086			500,594
Total principal balance	2,259,959			2,461,560
Covered discount	(224,635		)	(265,917		)
Net valuation of loans	2,035,324			2,195,643
Allowance on covered loans	(6,518		)	(7,745		)
Total covered loans, net	$	2,028,806		$	2,187,898

Schedule of covered loan portfolio by credit quality indicator

			Special
	Pass/Watch		Mention		Substandard		Doubtful		Total
	(In thousands)
March 31, 2014
Real estate loans:
Residential single-family	$	268,006	$	380	$	7,944	$	—	$	276,330
Residential multifamily	349,242		785		24,225		—		374,252
Commercial and industrial real estate	807,815		27,432		189,446		6,468		1,031,161
Construction and land	22,685		9,431		77,119		895		110,130
Total real estate loans	1,447,748		38,028		298,734		7,363		1,791,873
Other loans:
Commercial business	349,330		6,914		39,445		29		395,718
Other consumer	70,599		150		1,619		—		72,368
Total other loans	419,929		7,064		41,064		29		468,086
Total principal balance	$	1,867,677	$	45,092	$	339,798	$	7,392	$	2,259,959

			Special
	Pass/Watch		Mention		Substandard		Doubtful		Total
	(In thousands)
December 31, 2013
Real estate loans:
Residential single-family	$	281,246	$	733	$	8,116	$	—	$	290,095
Residential multifamily	373,024		785		29,699		—		403,508
Commercial and industrial real estate	857,376		27,851		211,835		6,468		1,103,530
Construction and land	41,847		9,472		111,616		898		163,833
Total real estate loans	1,553,493		38,841		361,266		7,366		1,960,966
Other loans:
Commercial business	378,086		4,635		43,797		103		426,621
Other consumer	72,053		128		1,792		—		73,973
Total other loans	450,139		4,763		45,589		103		500,594
Total principal balance	$	2,003,632	$	43,604	$	406,855	$	7,469	$	2,461,560

Covered nonperforming assets

	March 31,		December 31,
	2014		2013
	(In thousands)
Covered nonaccrual loans(1) (2) (3)	$	125,021	$	126,895
Covered loans past due 90 days or more but not on nonaccrual	—		—
Total nonperforming loans	125,021		126,895
Other real estate owned covered, net	30,610		21,373
Total covered nonperforming assets	$	155,631	$	148,268

(1)	Covered nonaccrual loans include loans that meet the criteria for nonaccrual but have a yield accreted through interest income under ASC 310-30 and all losses on covered loans are 80% reimbursed by the FDIC.
(2)	Represents principal balance net of discount.
(3)	Includes $12.8 million and $17.7 million of loans at March 31, 2014 and December 31, 2013, respectively, accounted for under ASC 310-10, of which some loans have additional partial balances accounted for under ASC 310-30.

Schedule of covered TDR loan activity

	Three Months Ended
	March 31,
	2014			2013
	(In thousands)
Balance at beginning of period	$	116,007		$	157,736
Additions	83			22,084
Sales	—			—
Transfers to covered OREO	(1,230		)	—
Charge-offs	(824		)	(3,704		)
Paydowns/ Reductions	(40,802		)	(34,193		)
Balance at end of period	$	73,234		$	141,923

Changes in the accretable yield for the covered loans

	Three Months Ended
	March 31,
	2014			2013
	(In thousands)
Balance at beginning of period	$	461,545		$	556,986
Additions	—			—
Accretion	(61,190		)	(81,627		)
Changes in expected cash flows	23,650			28,117
Balance at end of period	$	424,005		$	503,476

FDIC indemnification asset activity

	Three Months Ended
	March 31,
	2014			2013
	(In thousands)
Balance at beginning of period	$	74,708		$	316,313
Amortization	(28,490		)	(8,686		)
Reductions (1)	(11,842		)	(23,235		)
Estimate of FDIC repayment (2)	(6,824		)	(7,558		)
Balance at end of period	$	27,552		$	276,834

(1) Reductions relate to charge-offs, partial prepayments, loan payoffs and loan sales which result in a corresponding reduction of the indemnification asset.

(2) This represents the change in the calculated estimate the Company will be required to pay the FDIC at the end of the FDIC loss share agreements, due to lower thresholds of losses.

Schedule of FDIC receivable activity

	Three Months Ended
	March 31,
	2014			2013
	(In thousands)
Balance at beginning of period	$	30,261		$	73,091
Net (reduction) addition due to recovery or eligible expense/loss	(6,478		)	7,561
Payment received from the FDIC	(4,139		)	(33,890		)
Balance at end of period	$	19,644		$	46,762