Loans Held for Investment and Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2019

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Schedule of loans held for investments

Loans held for investment are summarized by portfolio segment as follows:

	December 31,
(in thousands)	2019			2018
Commercial	$	10,230,828		$	10,373,288
Mortgage finance(1)	8,169,849			5,877,524
Construction	2,563,339			2,120,966
Real estate	3,444,701			3,929,117
Consumer	71,463			63,438
Equipment leases	256,462			312,191
Gross loans held for investment	24,736,642			22,676,524
Deferred income (net of direct origination costs)	(90,380		)	(108,450		)
Allowance for loan losses	(195,047		)	(191,522		)
Total loans held for investment, net	$	24,451,215		$	22,376,552

Schedule of the credit risk profile of loan portfolio by internally assigned grades and nonaccrual status

The following tables summarize the credit risk profile of our loans held for investment by internally assigned grades and non-accrual status:

(in thousands)	Commercial		Mortgage Finance		Construction		Real Estate		Consumer		Equipment Leases		Total
December 31, 2019
Grade:
Pass	$	9,751,645	$	8,169,849	$	2,540,059	$	3,364,554	$	71,289	$	255,171	$	24,152,567
Special mention	198,269		—		6,590		52,919		140		1,062		258,980
Substandard-accruing	67,454		—		16,690		15,528		—		39		99,711
Non-accrual	213,460		—		—		11,700		34		190		225,384
Total loans held for investment	$	10,230,828	$	8,169,849	$	2,563,339	$	3,444,701	$	71,463	$	256,462	$	24,736,642
December 31, 2018
Grade:
Pass	$	10,034,597	$	5,877,524	$	2,099,955	$	3,850,811	$	61,815	$	309,775	$	22,234,477
Special mention	120,531		—		21,011		47,644		—		2,223		191,409
Substandard-accruing	140,297		—		—		28,205		1,568		193		170,263
Non-accrual	77,863		—		—		2,457		55		—		80,375
Total loans held for investment	$	10,373,288	$	5,877,524	$	2,120,966	$	3,929,117	$	63,438	$	312,191	$	22,676,524

Schedule of activity in the reserve for loan losses by portfolio segment

Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories.

(in thousands)	Commercial		Mortgage Finance		Construction			Real Estate			Consumer			Equipment Leases			Additional Qualitative Reserve			Total
Year ended December 31, 2019
Allowance for loan losses:
Beginning balance	$	129,442	$	—	$	19,242		$	33,353		$	425		$	1,829		$	7,231		$	191,522
Provision for loan losses	106,345		2,265		(4,469		)	(17,189		)	(441		)	(1,486		)	(7,231		)	77,794
Charge-offs	76,958		—		—			662			—			19			—			77,639
Recoveries	3,290		—		—			—			69			11			—			3,370
Net charge-offs (recoveries)	73,668		—		—			662			(69		)	8			—			74,269
Ending balance	$	162,119	$	2,265	$	14,773		$	15,502		$	53		$	335		$	—		$	195,047
Period end allowance for loan losses allocated to:
Loans individually evaluated for impairment	$	59,832	$	—	$	—		$	549		$	7		$	36		$	—		$	60,424
Loans collectively evaluated for impairment	102,287		2,265		14,773			14,953			46			299			—			134,623
Total	$	162,119	$	2,265	$	14,773		$	15,502		$	53		$	335		$	—		$	195,047
Period end loans allocated to:
Loans individually evaluated for impairment	$	213,460	$	—	$	—		$	11,700		$	34		$	190		$	—		$	225,384
Loans collectively evaluated for impairment	10,017,368		8,169,849		2,563,339			3,433,001			71,429			256,272			—			24,511,258
Total	$	10,230,828	$	8,169,849	$	2,563,339		$	3,444,701		$	71,463		$	256,462		$	—		$	24,736,642
Year ended December 31, 2018
Allowance for loan losses:
Beginning balance	$	118,806	$	—	$	19,273		$	34,287		$	357		$	3,542		$	8,390		$	184,655
Provision for loan losses	87,860		—		(31		)	(1,003		)	397			(1,427		)	(1,159		)	84,637
Charge-offs	79,692		—		—			—			767			319			—			80,778
Recoveries	2,468		—		—			69			438			33			—			3,008
Net charge-offs (recoveries)	77,224		—		—			(69		)	329			286			—			77,770
Ending balance	$	129,442	$	—	$	19,242		$	33,353		$	425		$	1,829		$	7,231		$	191,522
Period end allowance for loan losses allocated to:
Loans individually evaluated for impairment	$	8,252	$	—	$	—		$	48		$	10		$	—		$	—		$	8,310
Loans collectively evaluated for impairment	121,190		—		19,242			33,305			415			1,829			7,231			183,212
Total	$	129,442	$	—	$	19,242		$	33,353		$	425		$	1,829		$	7,231		$	191,522
Period end loans allocated to:
Loans individually evaluated for impairment	$	78,428	$	—	$	—		$	8,857		$	55		$	—		$	—		$	87,340
Loans collectively evaluated for impairment	10,294,860		5,877,524		2,120,966			3,920,260			63,383			312,191			—			22,589,184
Total	$	10,373,288	$	5,877,524	$	2,120,966		$	3,929,117		$	63,438		$	312,191		$	—		$	22,676,524

Schedule of impaired loans, by portfolio class

The following tables detail our impaired loans held for investment by portfolio segment. In accordance with ASC 310, Receivables, we have also included all restructured and formerly restructured loans in our impaired loan totals.

(in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
December 31, 2019
With no related allowance recorded:
Commercial
Business loans	$	35,932	$	51,172	$	—	$	20,074	$	—
Energy loans	57,722		58,519		—		15,692		—
Real estate
Market risk	8,500		8,806		—		4,980		—
Commercial	881		881		—		5,100		—
Secured by 1-4 family	1,218		1,218		—		1,226		—
Consumer	—		—		—		—		—
Equipment leases	—		—		—		—		—
Total impaired loans with no allowance recorded	$	104,253	$	120,596	$	—	$	47,072	$	—
With an allowance recorded:
Commercial
Business loans	$	52,479	$	55,422	$	29,467	$	27,288	$	—
Energy loans	67,327		87,067		30,365		51,232		—
Real estate
Market risk	870		870		499		2,257		—
Commercial	—		—		—		—		—
Secured by 1-4 family	231		231		50		621		—
Consumer	34		34		7		63		—
Equipment leases	190		190		36		16		—
Total impaired loans with an allowance recorded	$	121,131	$	143,814	$	60,424	$	81,477	$	—
Combined:
Commercial
Business loans	$	88,411	$	106,594	$	29,467	$	47,362	$	—
Energy loans	125,049		145,586		30,365		66,924		—
Real estate
Market risk	9,370		9,676		499		7,237		—
Commercial	881		881		—		5,100		—
Secured by 1-4 family	1,449		1,449		50		1,847		—
Consumer	34		34		7		63		—
Equipment leases	190		190		36		16		—
Total impaired loans	$	225,384	$	264,410	$	60,424	$	128,549	$	—

(in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
December 31, 2018
With no related allowance recorded:
Commercial
Business loans	$	23,367	$	55,008	$	—	$	16,426	$	133
Energy loans	12,188		13,363		—		17,135		—
Real estate
Market risk	—		—		—		—		—
Commercial	7,388		7,388		—		3,215		—
Secured by 1-4 family	1,233		1,233		—		734		—
Consumer	—		—		—		—		—
Equipment leases	—		—		—		—		—
Total impaired loans with no allowance recorded	$	44,176	$	76,992	$	—	$	37,510	$	133
With an allowance recorded:
Commercial
Business loans	$	17,529	$	17,564	$	4,679	$	41,307	$	—
Energy loans	25,344		28,105		3,573		25,672		—
Real estate
Market risk	—		—		—		49		—
Commercial	—		—		—		83		—
Secured by 1-4 family	236		236		48		188		—
Consumer	55		55		10		54		—
Equipment leases	—		—		—		275		—
Total impaired loans with an allowance recorded	$	43,164	$	45,960	$	8,310	$	67,628	$	—
Combined:
Commercial
Business loans	$	40,896	$	72,572	$	4,679	$	57,733	$	133
Energy loans	37,532		41,468		3,573		42,807		—
Real estate
Market risk	—		—		—		49		—
Commercial	7,388		7,388		—		3,298		—
Secured by 1-4 family	1,469		1,469		48		922		—
Consumer	55		55		10		54		—
Equipment leases	—		—		—		275		—
Total impaired loans	$	87,340	$	122,952	$	8,310	$	105,138	$	133

Schedule of an age analysis of accruing past due loans

The table below provides an age analysis of our loans held for investment:

(in thousands)	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due(1)		Total Past Due		Non-accrual		Current		Total
December 31, 2019
Commercial
Business loans	$	8,746	$	9,299	$	17,285	$	35,330	$	88,411	$	8,681,989	$	8,805,730
Energy	—		—		—		—		125,049		1,300,049		1,425,098
Mortgage finance loans	—		—		—		—		—		8,169,849		8,169,849
Construction
Market risk	—		—		—		—		—		2,457,986		2,457,986
Commercial	—		—		—		—		—		93,764		93,764
Secured by 1-4 family	—		—		—		—		—		11,589		11,589
Real estate
Market risk	10,786		—		—		10,786		9,370		2,238,384		2,258,540
Commercial	—		495		193		688		881		810,149		811,718
Secured by 1-4 family	104		179		106		389		1,449		372,605		374,443
Consumer	—		212		—		212		34		71,217		71,463
Equipment leases	304		—		—		304		190		255,968		256,462
Total loans held for investment	$	19,940	$	10,185	$	17,584	$	47,709	$	225,384	$	24,463,549	$	24,736,642

(1)

Loans past due 90 days and still accruing includes premium finance loans of $8.5 million. These loans are generally secured by obligations of insurance carriers to refund premiums on canceled insurance policies. The receipt of the refund of premiums from the insurance carriers can take 180 days or longer from the cancellation date.

Schedule of loans that have been restructured

The following table details the recorded investment at December 31, 2019 and 2018 of loans that have been restructured during the years ended December 31, 2019 and 2018 by type of modification:

	Extended Maturity			Adjusted Payment Schedule			Total
(in thousands, except number of contracts)	Number of Contracts	Balance at Period End		Number of Contracts	Balance at Period End		Number of Contracts		Balance at Period End
Year Ended December 31, 2019
Commercial
Business loans	1	$	1,753	3	$	21,193	4		$	22,946
Energy loans	1	3,935		—	—		1		3,935
Total	2	$	5,688	3	$	21,193	$	5	$	26,881
Year Ended December 31, 2018
Commercial
Business loans	—	$	—	2	$	2,411	$	2	$	2,411
Energy loans	—	—		5	10,047		5		10,047
Total	—	$	—	7	$	12,458	$	7	$	12,458