10-Q 1 snv-09302017x10q.htm 10-Q Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________
 
FORM 10-Q
 
______________________________
Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended September 30, 2017
Commission file number 1-10312
 
______________________________
financialappendix930a29.jpg
SYNOVUS FINANCIAL CORP.
(Exact name of registrant as specified in its charter)
______________________________
 
Georgia
 
58-1134883
(State or other jurisdiction of incorporation or organization)
 
   (I.R.S. Employer Identification No.)
1111 Bay Avenue
Suite 500, Columbus, Georgia
 
31901
(Address of principal executive offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (706) 649-2311
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Name of each exchange on which registered
Common Stock, $1.00 Par Value
Series B Participating Cumulative Preferred Stock Purchase Rights
Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: NONE
______________________________
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    YES x  NO ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   YES x  NO ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check One):
Large accelerated filer
x
Accelerated filer
¨
 
 
 
 
Non-accelerated filer
¨ (Do not check if a smaller reporting company)
Smaller reporting company
¨
 
 
 
 
 
 
Emerging growth company
¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 7(a)2(B) of the Securities Act.  ¨ 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ¨    NO x
Indicate the number of shares outstanding of each of the issuer’s class of common stock, as of the latest practicable date.
Class
 
 
 
November 2, 2017

Common Stock, $1.00 Par Value
 
 
 
119,514,829





Table of Contents
 
 
 
 
 
Page
Financial Information
 
 
 
Index of Defined Terms
 
Item 1.
Financial Statements (Unaudited)
 
 
 
Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016
 
 
Consolidated Statements of Income for the Nine and Three Months Ended September 30, 2017 and 2016
 
 
Consolidated Statements of Comprehensive Income for the Nine and Three Months Ended September 30, 2017 and 2016
 
 
Consolidated Statements of Changes in Shareholders' Equity for the Nine Months Ended September 30, 2017 and 2016
 
 
Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2017 and 2016
 
 
Notes to Unaudited Interim Consolidated Financial Statements
 
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
 
Item 3.
 
Item 4.
Controls and Procedures
 
 
 
 
 
Other Information
 
 
Item 1.
Legal Proceedings
 
Item 1A.
Risk Factors
 
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
 
Item 3.
Defaults Upon Senior Securities
 
Item 4.
Mine Safety Disclosures
 
Item 5.
Other Information
 
Item 6.
Exhibits
 
Signatures
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 






SYNOVUS FINANCIAL CORP.
INDEX OF DEFINED TERMS
ALCO – Synovus' Asset Liability Management Committee
ASC – Accounting Standards Codification
ASU – Accounting Standards Update
ATM – Automatic teller machine
Basel III – A global regulatory framework developed by the Basel Committee on Banking Supervision
BOLI – Bank-Owned Life Insurance
BOV – Broker’s opinion of value
bp – Basis point (bps - basis points)
C&I – Commercial and industrial loans
CET1 – Common Equity Tier 1 Capital defined by Basel III capital rules
CME – Chicago Mercantile Exchange
CMO – Collateralized Mortgage Obligation
Cabela’s Transaction – The transaction completed on September 25, 2017 whereby Synovus Bank acquired certain assets and assumed certain liabilities of WFB and then immediately thereafter sold WFB’s credit card assets and certain related liabilities to Capital One Bank (USA), National Association, a bank subsidiary of Capital One Financial Corporation.  As a part of this transaction, Synovus Bank retained WFB’s $1.10 billion brokered time deposit portfolio and received a $75.0 million fee from Cabela’s and Capital One.  Throughout this Report, we refer to this transaction as the “Cabela’s Transaction” and the associated $75.0 million fee received from Cabela’s and Capital One as the “Cabela’s Transaction Fee
Code – Internal Revenue Code of 1986, as amended
Company – Synovus Financial Corp. and its wholly-owned subsidiaries, except where the context requires otherwise
Covered Litigation – Certain Visa litigation for which Visa is indemnified by Visa USA members
CRE – Commercial real estate
DIF – Deposit Insurance Fund
Dodd-Frank Act – The Dodd-Frank Wall Street Reform and Consumer Protection Act
EVE – economic value of equity
Exchange Act – Securities Exchange Act of 1934, as amended
FASB – Financial Accounting Standards Board
FDIC – Federal Deposit Insurance Corporation
Federal Reserve Bank – The 12 banks that are the operating arms of the U.S. central bank. They implement the policies of the Federal Reserve Board and also conduct economic research
Federal Reserve Board – The 7-member Board of Governors that oversees the Federal Reserve System, establishes monetary policy, and monitors the economic health of the country. Its members are appointed by the President, subject to Senate confirmation, and serve 14-year terms
Federal Reserve System – The 12 Federal Reserve Banks, with each one serving member banks in its own district. This system, supervised by the Federal Reserve Board, has broad regulatory powers over the money supply and the credit structure
FFIEC – Federal Financial Institutions Examination Council
FHLB – Federal Home Loan Bank
FICO – Fair Isaac Corporation
GA DBF – Georgia Department of Banking and Finance

i


GAAP – Generally Accepted Accounting Principles in the United States of America
GGL – government guaranteed loans
Global One – Entaire Global Companies, Inc., the parent company of Global One Financial, Inc., as acquired by Synovus on October 1, 2016. Throughout this Report, we refer to this acquisition as "Global One"
HELOC – Home equity line of credit
LTV – Loan-to-collateral value ratio
NAICS – North American Industry Classification System
nm – not meaningful
NPA – Non-performing assets
NPL – Non-performing loans
NSF – Non-sufficient funds
OCI – Other comprehensive income
OTC– Over-the-counter
ORE – Other real estate
OTTI – Other-than-temporary impairment
Parent Company – Synovus Financial Corp.
SBA – Small Business Administration
SCM – State, county, and municipal
SEC – U.S. Securities and Exchange Commission
Securities Act – Securities Act of 1933, as amended
Series C Preferred Stock – Synovus' Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C, $25 liquidation preference
Synovus – Synovus Financial Corp.
Synovus Bank – A Georgia state-chartered bank and wholly-owned subsidiary of Synovus through which Synovus conducts its banking operations
Synovus' 2016 Form 10-K – Synovus' Annual Report on Form 10-K for the year ended December 31, 2016
Synovus Mortgage – Synovus Mortgage Corp., a wholly-owned subsidiary of Synovus Bank
Synovus Securities – Synovus Securities, Inc., a wholly-owned subsidiary of Synovus
Synovus Trust – Synovus Trust Company, N.A., a wholly-owned subsidiary of Synovus Bank
TDR – Troubled debt restructuring (as defined in ASC 310-40)
Treasury – United States Department of the Treasury
VIE – Variable interest entity, as defined in ASC 810-10
Visa – The Visa U.S.A., Inc. card association or its affiliates, collectively
Visa Class B shares – Class B shares of common stock issued by Visa which are subject to restrictions with respect to sale until all of the Covered Litigation has been settled
Visa Derivative – A derivative contract with the purchaser of Visa Class B shares which provides for settlements between the purchaser and Synovus based upon a change in the ratio for conversion of Visa Class B shares into Visa Class A shares
Warrant – A warrant issued to the Treasury by Synovus to purchase up to 2,215,820 shares of Synovus common stock at a per share exercise price of $65.52 expiring on December 19, 2018, as was issued by Synovus to Treasury in 2008 in connection with the Capital Purchase Program, promulgated under the Emergency Stabilization Act of 2008
WFB – World's Foremost Bank, a wholly-owned subsidiary of Cabela's Incorporated

ii



PART I. FINANCIAL INFORMATION
ITEM 1. - FINANCIAL STATEMENTS
SYNOVUS FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except share and per share data)
September 30, 2017
 
December 31, 2016
ASSETS
 
 
 
Cash and cash equivalents
$
386,459

 
395,175

Interest bearing funds with Federal Reserve Bank
1,297,581

 
527,090

Interest earning deposits with banks
6,047

 
18,720

Federal funds sold and securities purchased under resale agreements
48,820

 
58,060

Trading account assets, at fair value
12,329

 
9,314

Mortgage loans held for sale, at fair value
54,072

 
51,545

Other loans held for sale
31,253

 

Investment securities available for sale, at fair value
3,825,443

 
3,718,195

Loans, net of deferred fees and costs
24,487,360

 
23,856,391

Allowance for loan losses
(249,683
)
 
(251,758
)
Loans, net
$
24,237,677

 
23,604,633

Premises and equipment, net
423,245

 
417,485

Goodwill
57,315

 
59,678

Other intangible assets
11,548

 
13,223

Other real estate
10,551

 
22,308

Deferred tax asset, net
272,052

 
395,356

Other assets
967,731

 
813,220

Total assets
$
31,642,123

 
30,104,002

LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
Liabilities
 
 
 
Deposits:
 
 
 
Non-interest bearing deposits
$
7,302,682

 
7,085,804

Interest bearing deposits, excluding brokered deposits
16,420,319

 
16,183,273

Brokered deposits
2,463,227

 
1,378,983

Total deposits
26,186,228

 
24,648,060

Federal funds purchased and securities sold under repurchase agreements
141,539

 
159,699

Long-term debt
1,882,607

 
2,160,881

Other liabilities
434,671

 
207,438

Total liabilities
$
28,645,045

 
27,176,078

Shareholders' Equity
 
 
 
Series C Preferred Stock – no par value. Authorized 100,000,000 shares; 5,200,000 shares issued and outstanding at September 30, 2017 and December 31, 2016
$
125,980

 
125,980

Common stock - $1.00 par value. Authorized 342,857,143 shares; 142,525,139 issued at September 30, 2017 and 142,025,720 issued at December 31, 2016; 119,566,625 outstanding at September 30, 2017 and 122,266,106 outstanding at December 31, 2016
142,525

 
142,026

Additional paid-in capital
3,033,682

 
3,028,405

Treasury stock, at cost – 22,958,514 shares at September 30, 2017 and 19,759,614 shares at December 31, 2016
(800,509
)
 
(664,595
)
Accumulated other comprehensive loss
(39,596
)
 
(55,659
)
Retained earnings
534,996

 
351,767

Total shareholders’ equity
2,997,078

 
2,927,924

Total liabilities and shareholders' equity
$
31,642,123

 
30,104,002

 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

1


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
 
Nine Months Ended September 30,
 
Three Months Ended September 30,
(in thousands, except per share data)
2017
 
2016
 
2017
 
2016
Interest income:
 
 
 
 
 
 
 
      Loans, including fees
$
785,166

 
700,340

 
$
273,847

 
237,448

      Investment securities available for sale
60,112

 
49,926

 
20,014

 
16,269

      Trading account assets
90

 
46

 
41

 
13

      Mortgage loans held for sale
1,478

 
1,966

 
506

 
727

      Federal Reserve Bank balances
4,084

 
3,170

 
1,569

 
1,151

      Other earning assets
4,633

 
2,822

 
1,675

 
946

Total interest income
855,563

 
758,270

 
297,652

 
256,554

Interest expense:
 
 
 
 
 
 
 
Deposits
55,874

 
48,072

 
20,798

 
15,858

Federal funds purchased and securities sold under repurchase agreements
125

 
154

 
42

 
58

Long-term debt
45,967

 
44,394

 
14,240

 
14,631

Total interest expense
101,966

 
92,620

 
35,080

 
30,547

Net interest income
753,597

 
665,650

 
262,572

 
226,007

Provision for loan losses
58,620

 
21,741

 
39,686

 
5,671

Net interest income after provision for loan losses
694,977

 
643,909

 
222,886

 
220,336

Non-interest income:
 
 
 
 
 
 
 
Service charges on deposit accounts
59,848

 
60,772

 
20,255

 
20,822

Fiduciary and asset management fees
37,290

 
34,691

 
12,615

 
11,837

Brokerage revenue
21,947

 
20,019

 
7,511

 
6,199

Mortgage banking income
17,151

 
18,755

 
5,603

 
7,329

Bankcard fees
24,339

 
24,988

 
7,901

 
8,269

Cabela's Transaction Fee
75,000

 

 
75,000

 

Investment securities (losses) gains, net
(289
)
 
126

 
(7,956
)
 
59

Decrease in fair value of private equity investments, net
(3,193
)
 
(527
)
 
(27
)
 
(249
)
Other fee income
16,127

 
15,255

 
5,094

 
5,171

Other non-interest income
27,754

 
25,109

 
9,439

 
8,718

Total non-interest income
275,974

 
199,188

 
135,435

 
68,155

Non-interest expense:
 
 
 
 
 
 
 
Salaries and other personnel expense
322,079

 
300,364

 
109,675

 
101,945

Net occupancy and equipment expense
89,837

 
81,480

 
30,573

 
28,120

Third-party processing expense
39,882

 
34,033

 
13,659

 
11,219

FDIC insurance and other regulatory fees
20,723

 
20,100

 
7,078

 
6,756

Professional fees
20,048

 
19,794

 
7,141

 
6,486

Advertising expense
14,868

 
15,358

 
3,610

 
5,597

Foreclosed real estate expense, net
10,847

 
9,998

 
7,265

 
2,725

Earnout liability adjustments
3,766

 

 
2,059

 

Merger-related expense
110

 
550

 
23

 
550

Loss on early extinguishment of debt, net

 
4,735

 

 

Fair value adjustment to Visa derivative

 
1,079

 

 
360

Restructuring charges, net
7,043

 
8,225

 
519

 
1,243

Other operating expenses
65,577

 
67,000

 
24,044

 
20,870

Total non-interest expense
594,780

 
562,716

 
205,646

 
185,871

Income before income taxes
376,171

 
280,381

 
152,675

 
102,620

Income tax expense
130,303

 
102,148

 
54,668

 
37,375

Net income
245,868

 
178,233

 
98,007

 
65,245

Dividends on preferred stock
7,678

 
7,678

 
2,559

 
2,559

Net income available to common shareholders
$
238,190

 
170,555

 
$
95,448

 
62,686

Net income per common share, basic
$
1.96

 
1.36

 
$
0.79

 
0.51

Net income per common share, diluted
1.94

 
1.36

 
0.78

 
0.51

Weighted average common shares outstanding, basic
121,796

 
125,076

 
120,900

 
122,924

Weighted average common shares outstanding, diluted
122,628

 
125,712

 
121,814

 
123,604

 
 
 
 
 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

2


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)

 
Nine Months Ended September 30,
 
2017
 
2016
(in thousands)
Before-tax Amount
 
Tax (Expense) Benefit
 
Net of Tax Amount
 
Before-tax Amount
 
Tax (Expense) Benefit
 
Net of Tax Amount
Net income
$
376,171

 
(130,303
)
 
245,868

 
280,381

 
(102,148
)
 
178,233

Net change related to cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for losses realized in net income
130

 
(50
)
 
80

 
402

 
(155
)
 
247

Net unrealized gains on investment securities available for sale:
 
 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for net losses (gains) realized in net income
289

 
(111
)
 
178

 
(126
)
 
49

 
(77
)
Net unrealized gains arising during the period
25,715

 
(9,903
)
 
15,812

 
56,648

 
(21,821
)
 
34,827

Net unrealized gains
26,004

 
(10,014
)
 
15,990

 
56,522

 
(21,772
)
 
34,750

Post-retirement unfunded health benefit:
 
 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for gains realized in net income
(74
)
 
29

 
(45
)
 
(124
)
 
48

 
(76
)
Actuarial gains arising during the period
61

 
(23
)

38

 
102

 
(39
)
 
63

Net unrealized (realized) gains
$
(13
)
 
6

 
(7
)
 
(22
)
 
9

 
(13
)
Other comprehensive income
$
26,121

 
(10,058
)
 
16,063

 
56,902

 
(21,918
)
 
34,984

Comprehensive income
 
 
 
 
$
261,931

 
 
 
 
 
213,217

 
 
 
 
 
 
 
 
 
 
 
 

 
Three Months Ended September 30,
 
2017
 
2016
(in thousands)
Before-tax Amount
 
Tax (Expense) Benefit
 
Net of Tax Amount
 
Before-tax Amount
 
Tax (Expense) Benefit
 
Net of Tax Amount
Net income
$
152,675

 
(54,668
)
 
98,007

 
102,620

 
(37,375
)
 
65,245

Net change related to cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for losses realized in net income

 

 

 
65

 
(25
)
 
40

Net unrealized gains (losses) on investment securities available for sale:


 


 
 
 
 
 
 
 
 
Reclassification adjustment for net losses (gains) realized in net income
7,956

 
(3,063
)
 
4,893

 
(59
)
 
23

 
(36
)
Net unrealized gains (losses) arising during the period
5,465

 
(2,106
)
 
3,359

 
(9,567
)
 
3,672

 
(5,895
)
Net unrealized gains (losses)
13,421

 
(5,169
)
 
8,252

 
(9,626
)
 
3,695

 
(5,931
)
Post-retirement unfunded health benefit:
 
 


 
 
 
 
 
 
 
 
Reclassification adjustment for gains realized in net income
(34
)
 
13

 
(21
)
 
(20
)
 
8

 
(12
)
Actuarial gains arising during the period
61

 
(23
)

38

 
102

 
(39
)
 
63

Net unrealized (realized) gains
$
27

 
(10
)
 
17

 
82

 
(31
)
 
51

Other comprehensive income (loss)
$
13,448

 
(5,179
)
 
8,269

 
(9,479
)
 
3,639

 
(5,840
)
Comprehensive income
 
 
 
 
$
106,276

 
 
 
 
 
59,405

 
 
 
 
 
 
 
 
 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

3


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited)
(in thousands, except per share data)
Series C Preferred Stock
 
Common
Stock
 
Additional
Paid-in
Capital
 
Treasury
Stock
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Retained Earnings
 
Total
Balance at December 31, 2015
$
125,980

 
140,592

 
2,989,981

 
(401,511
)
 
(29,819
)
 
174,973

 
3,000,196

Net income

 

 

 

 

 
178,233

 
178,233

Other comprehensive income, net of income taxes

 

 

 

 
34,984

 

 
34,984

Cash dividends declared on common stock -$0.36 per share

 

 

 

 

 
(44,737
)
 
(44,737
)
Cash dividends paid on Series C Preferred Stock

 

 

 

 

 
(7,678
)
 
(7,678
)
Repurchases of common stock

 

 
(10,581
)
 
(252,503
)
 

 

 
(263,084
)
Restricted share unit activity

 
301

 
(4,860
)
 

 

 
(89
)
 
(4,648
)
Stock options exercised

 
173

 
2,808

 

 

 

 
2,981

Share-based compensation net tax benefit

 

 
199

 

 

 

 
199

Share-based compensation expense

 

 
10,213

 

 

 

 
10,213

Balance at September 30, 2016
$
125,980

 
141,066

 
2,987,760

 
(654,014
)
 
5,165

 
300,702

 
2,906,659

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at December 31, 2016
$
125,980

 
142,026

 
3,028,405

 
(664,595
)
 
(55,659
)
 
351,767

 
2,927,924

Net income

 

 

 

 

 
245,868

 
245,868

Other comprehensive income, net of income taxes

 

 

 

 
16,063

 

 
16,063

Cash dividends declared on common stock - $0.45 per share

 

 

 

 

 
(54,671
)
 
(54,671
)
Cash dividends paid on Series C Preferred Stock

 

 

 

 

 
(7,678
)
 
(7,678
)
Repurchases of common stock

 

 

 
(135,914
)
 

 

 
(135,914
)
Restricted share unit activity

 
335

 
(8,007
)
 

 

 
(290
)
 
(7,962
)
Stock options exercised

 
164

 
2,708

 

 

 

 
2,872

Share-based compensation expense

 

 
10,576

 

 

 

 
10,576

Balance at September 30, 2017
$
125,980

 
$
142,525

 
3,033,682

 
(800,509
)
 
(39,596
)
 
534,996

 
2,997,078

 
 
 
 
 
 
 
 
 
 
 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

4


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
 
Nine Months Ended September 30,
(in thousands)
2017
 
2016
Operating Activities
 
 
 
Net income
$
245,868

 
178,233

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Provision for loan losses
58,620

 
21,741

Depreciation, amortization, and accretion, net
44,786

 
43,615

Deferred income tax expense
114,205

 
94,436

Decrease in trading account assets
(3,014
)
 
(2,212
)
Originations of mortgage loans held for sale
(490,202
)
 
(512,572
)
Proceeds from sales of mortgage loans held for sale
500,786

 
486,690

Gain on sales of mortgage loans held for sale, net
(10,587
)
 
(10,828
)
Increase in other assets
(18,598
)
 
(38,577
)
Increase in other liabilities
17,718

 
37,068

Investment securities losses (gains), net
289

 
(126
)
Losses and write-downs on other real estate, net
9,869

 
8,194

Decrease in fair value of private equity investments, net
3,193

 
527

Losses and write-downs on other assets held for sale, net
1,872

 
7,205

Loss on early extinguishment of debt, net

 
4,735

Share-based compensation expense
10,576

 
10,213

Net cash provided by operating activities
$
485,381

 
328,342

 
 
 
 
Investing Activities
 
 
 
Net decrease (increase) in interest earning deposits with banks
12,673

 
(988
)
Net decrease (increase) in federal funds sold and securities purchased under resale agreements
9,240

 
(1,934
)
Net increase in interest bearing funds with Federal Reserve Bank
(770,491
)
 
(155,889
)
Proceeds from maturities and principal collections of investment securities available for sale
483,307

 
711,882

Proceeds from sales of investment securities available for sale
812,293

 
596,824

Purchases of investment securities available for sale
(1,195,302
)
 
(1,233,236
)
Proceeds from sales of loans
26,386

 
8,433

Proceeds from sales of other real estate
8,359

 
25,415

Net increase in loans
(755,231
)
 
(879,200
)
Purchases of bank-owned life insurance policies
(150,000
)
 

Net increase in premises and equipment
(34,717
)
 
(24,491
)
Proceeds from sales of other assets held for sale
3,158

 
5,673

Net cash used in investing activities
$
(1,550,325
)
 
(947,511
)
 
 
 
 
Financing Activities
 
 
 
Net increase in demand and savings deposits
335,438

 
1,054,389

Net increase (decrease) in certificates of deposit
1,202,926

 
(105,698
)
Net (decrease) increase in federal funds purchased and securities sold under repurchase agreements
(18,160
)
 
18,000

Repayments on long-term debt
(1,653,613
)
 
(1,730,106
)
Proceeds from issuance of long-term debt
1,375,000

 
1,700,000

Dividends paid to common shareholders
(36,681
)
 
(44,737
)
Dividends paid to preferred shareholders
(7,678
)
 
(7,678
)
Stock options exercised
2,872

 
2,981

Repurchases of common stock
(135,914
)
 
(263,084
)
Restricted stock activity
(7,962
)
 
(4,648
)
Net cash provided by financing activities
$
1,056,228

 
619,419

(Decrease) increase in cash and cash equivalents
(8,716
)
 
250

Cash and cash equivalents at beginning of period
395,175

 
367,092

Cash and cash equivalents at end of period
$
386,459

 
367,342

 
 
 
 

5


Supplemental Cash Flow Information
 
 
 
Cash paid during the period for:
 
 
 
Income tax payments, net
$
11,195

 
6,828

Interest paid
101,632

 
93,479

Non-cash Activities
 
 
 
Premises and equipment transferred to other assets held for sale
1,063

 
23,667

Other assets held for sale transferred to premises and equipment
4,450

 

Loans foreclosed and transferred to other real estate
6,571

 
15,017

Loans transferred to other loans held for sale at fair value
77,774

 
10,482

   Securities purchased during the period but settled after period-end
193,286

 
49,479

   Dividends declared on common stock during the period but paid after period-end
17,990

 

 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

6



Notes to Unaudited Interim Consolidated Financial Statements
Note 1 - Significant Accounting Policies
Business Operations
The accompanying unaudited interim consolidated financial statements of Synovus Financial Corp. include the accounts of the Parent Company and its consolidated subsidiaries. Synovus Financial Corp. is a financial services company based in Columbus, Georgia. Through its wholly-owned subsidiary, Synovus Bank, a Georgia state-chartered bank that is a member of the Federal Reserve System, the company provides commercial and retail banking in addition to a full suite of specialized products and services including private banking, treasury management, wealth management, premium finance and international banking.
Synovus Bank is positioned in some of the highest growth markets in the Southeast, with 249 branches and 328 ATMs in Georgia, Alabama, South Carolina, Florida, and Tennessee.
Basis of Presentation
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions to the SEC Form 10-Q and Article 10 of Regulation S-X; therefore, they do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, comprehensive income, and cash flows in conformity with GAAP. All adjustments consisting of normally recurring accruals that, in the opinion of management, are necessary for a fair presentation of the consolidated financial position and results of operations for the periods covered by this Report have been included. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes appearing in Synovus' 2016 Form 10-K. There have been no significant changes to the accounting policies as disclosed in Synovus' 2016 Form 10-K.
In preparing the unaudited interim consolidated financial statements in accordance with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the respective consolidated balance sheets and the reported amounts of revenues and expenses for the periods presented. Actual results could differ significantly from those estimates.
Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, the fair value of investment securities, and the fair value of private equity investments.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and due from banks. At December 31, 2016, $533 thousand of the due from banks balance was restricted as to withdrawal. There were no cash and cash equivalents restricted as to withdrawal at September 30, 2017.
Short-term Investments
Short-term investments consist of interest bearing funds with the Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements. At September 30, 2017 and December 31, 2016, interest bearing funds with the Federal Reserve Bank included $57.7 million and $130.0 million, respectively, on deposit to meet Federal Reserve Bank requirements. Interest earning deposits with banks include $6.0 million and $5.6 million at September 30, 2017 and December 31, 2016, respectively, which are pledged as collateral in connection with certain letters of credit. Federal funds sold include $45.8 million and $56.1 million at September 30, 2017 and December 31, 2016, respectively, which are pledged to collateralize certain derivative financial instruments. Federal funds sold and securities purchased under resale agreements, and federal funds purchased and securities sold under repurchase agreements, generally mature in one day.
Recently Adopted Accounting Standards Updates
During 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 simplified various aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. This accounting standard update included a requirement to record all tax effects associated with share-based compensation through the income statement. Prior to 2017, tax benefits in excess of compensation cost (“windfalls”) and tax deficiencies (“shortfalls”) were recorded in equity. During the nine and three months ended September 30, 2017, Synovus recognized $4.7 million and $211 thousand, respectively, of income tax benefits from excess tax benefits that occurred during the nine months ended September 30, 2017 from the vesting of restricted share units and exercise of stock options. As of January 1, 2017, Synovus had no previously unrecognized excess tax benefits. Additionally, beginning January 1, 2017, Synovus modified the denominator in the diluted earnings per common share calculation under the treasury stock method to exclude future excess tax benefits as part of the assumed proceeds. Synovus elected to retain its existing accounting policy election to estimate award forfeitures.

7


During 2015, the FASB issued ASU 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes, which became effective January 1, 2017. ASU 2015-17 required deferred income tax liabilities and assets be classified as noncurrent in the statement of financial position instead of separating deferred taxes into current and noncurrent amounts. Also, valuation allowances will no longer be classified between current and noncurrent because these allowances will be required to be classified as noncurrent under the new standard. This ASU only impacts classification in the balance sheet, and has no impact on required deferred tax footnote disclosures (i.e., required presentation of “gross” deferred tax assets and “gross” deferred tax liabilities). The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by this ASU. There is no impact to our balance sheet as a result of this standard because Synovus has not historically distinguished deferred taxes on the balance sheet as current vs. non-current.
Reclassifications
Prior periods' consolidated financial statements are reclassified whenever necessary to conform to the current periods' presentation.

Note 2 - Acquisitions
Cabela's Transaction
On September 25, 2017, Synovus' wholly owned subsidiary, Synovus Bank, completed the acquisition of certain assets and assumption of certain liabilities of WFB. Immediately following the closing of this transaction, Synovus Bank sold WFB’s credit card assets and related liabilities to Capital One Bank (USA), National Association, a bank subsidiary of Capital One Financial Corporation.
Synovus retained WFB’s $1.10 billion brokered time deposits portfolio, which had a weighted average remaining maturity of approximately 2.53 years and a weighted average rate of 1.83% as of September 25, 2017. The transaction was accounted for as an assumption of a liability (accounted for under the asset acquisition model). In accordance with ASC 820, Fair Value Measurements and Disclosures, the brokered time deposit portfolio was recorded at $1.10 billion, which was the amount of cash received for the deposits and represented the estimated fair value of the deposits at the transaction date. Additionally, Synovus received a $75.0 million transaction fee from Cabela’s and Capital One, which was recognized into earnings upon closing of the transaction, based on having achieved the recognition criteria outlined in SEC SAB Topic 13.A, Revenue Recognition.
Acquisition of Global One
On October 1, 2016, Synovus completed its acquisition of all of the outstanding stock of Global One. Prior to its acquisition, Global One was an Atlanta-based private specialty financial services company that lended primarily to commercial entities, with all loans fully collateralized by cash value life insurance policies and/or annuities issued by investment grade life insurance companies. Under the terms of the merger agreement, Synovus acquired Global One for an up-front payment of $30 million, consisting of the issuance of 821 thousand shares of Synovus common stock valued at $26.6 million and $3.4 million in cash, with additional payments to Global One's former shareholders over the next three to five years based on earnings from the Global One business as further discussed below.
The acquisition of Global One constituted a business combination. Accordingly, the assets acquired and liabilities assumed were recorded at their estimated fair values as shown in the following table. The determination of fair value required management to make estimates about discount rates, future expected earnings and cash flows, market conditions, future loan growth, and other future events that are highly subjective in nature and subject to change. These fair value estimates reflect measurement period adjustments to the amounts reported as of December 31, 2016, the most significant of which consist of a reduction in goodwill of $2.4 million and a decrease in the estimated fair value of contingent consideration of $1.8 million (the income statement impact of such adjustments was insignificant).

8


Global One
 
October 1, 2016
(in thousands)
 
Fair Value
Assets acquired:
 
 
Cash and due from banks
 
$
9,554

      Commercial and industrial loans(1)
 
357,307

Goodwill(2)
 
32,884

Other intangible assets
 
12,500

Other assets
 
3,681

Total assets acquired
 
$
415,926

 
 
 
Liabilities assumed:
 
 
Notes payable(3)
 
$
358,560

Contingent consideration
 
12,234

Deferred tax liability, net
 
3,229

Other liabilities
 
11,903

Total liabilities assumed
 
$
385,926

Consideration paid
 
$
30,000

 
 
 
Cash paid
 
$
3,408

Fair value of common stock issued
 
26,592

 
 
 
(1) The unpaid principal balance of the loans was $356.7 million.  
(2) The goodwill is not expected to be deductible for tax purposes.
(3) The unpaid principal balance of the notes payable was $357.0 million.
Under the terms of the merger agreement, the purchase price includes additional annual payments ("Earnout Payments") to Global One's former shareholders over the next three to five years, with amounts based on a percentage of "Global One Earnings," as defined in the merger agreement. The Earnout Payments will consist of shares of Synovus common stock as well as a smaller cash consideration component.
Other intangible assets consist of existing borrower relationships (11 years useful life), trade name (10 years useful life), and distribution network (8 years useful life) with September 30, 2017 net carrying values of $9.8 million, $990 thousand, and $525 thousand, respectively.
The following is a description of the methods used to determine the fair values of significant assets and liabilities:
Commercial and industrial loans: The fair value of loans was determined based on a discounted cash flow approach. The most significant assumptions used in the valuation of the loan portfolio consisted of the prepayment rate, the probability of extension at maturity, the interest rates on extended loans, and the discount rates. All loans are fully collateralized by cash value life insurance policies and/or annuities issued by investment grade insurance companies. Based on a history of no principal losses on the loan portfolio since inception as well as the collateral position, no losses were estimated in the event of default.
Notes payable: The notes payable were extinguished immediately after the closing of the acquisition. Accordingly, the fair value of notes payable was determined based on the amounts paid to extinguish such notes, inclusive of applicable prepayment penalties, which is consistent with the perspective of a market participant.
Contingent consideration: The fair value of the contingent consideration, which represents the fair value of the above referenced Earnout Payments, was determined based on option pricing methods and a Monte Carlo simulation. The most significant assumptions used in the valuation of the contingent consideration were the expected cash flows, volatility, and discount rates. Subsequent changes in the fair value of the contingent consideration are recognized in earnings until the contingent consideration arrangement is settled.
Note 3 - Share Repurchase Program
Synovus' Board of Directors authorized an up to $200 million share repurchase program that will expire at the end of 2017. This program was announced on January 17, 2017. As of September 30, 2017, Synovus had repurchased under this program a total of $135.9 million, or 3.2 million shares, at an average price of $42.47 per share.

9


Note 4 - Investment Securities
The amortized cost, gross unrealized gains and losses, and estimated fair values of investment securities available for sale at September 30, 2017 and December 31, 2016 are summarized below.
 
 
September 30, 2017
(in thousands)
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
 Fair Value
U.S. Treasury securities
 
$
83,550

 

 
(369
)
 
83,181

U.S. Government agency securities
 
10,772

 
266

 

 
11,038

Mortgage-backed securities issued by U.S. Government agencies
 
127,521

 
715

 
(852
)
 
127,384

Mortgage-backed securities issued by U.S. Government sponsored enterprises
 
2,663,959

 
7,917

 
(20,024
)
 
2,651,852

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
 
943,583

 

 
(12,143
)
 
931,440

State and municipal securities
 
180

 
1

 

 
181

Corporate debt and other securities
 
20,297

 
286

 
(216
)
 
20,367

Total investment securities available for sale
 
$
3,849,862

 
9,185

 
(33,604
)
 
3,825,443

 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
(in thousands)
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Fair Value
U.S. Treasury securities
 
$
108,221

 
225

 
(644
)
 
107,802

U.S. Government agency securities
 
12,727

 
266

 

 
12,993

Mortgage-backed securities issued by U.S. Government agencies
 
174,440

 
1,116

 
(1,354
)
 
174,202

Mortgage-backed securities issued by U.S. Government sponsored enterprises
 
2,543,495

 
5,416

 
(42,571
)
 
2,506,340

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
 
905,789

 
1,214

 
(16,561
)
 
890,442

State and municipal securities
 
2,780

 
14

 

 
2,794

Equity securities
 
919

 
2,863

 

 
3,782

Corporate debt and other securities
 
20,247

 

 
(407
)
 
19,840

Total investment securities available for sale
 
$
3,768,618

 
11,114

 
(61,537
)
 
3,718,195

 
 
 
 
 
 
 
 
 
At September 30, 2017 and December 31, 2016, investment securities with a carrying value of $1.69 billion and $2.04 billion, respectively, were pledged to secure certain deposits and securities sold under repurchase agreements as required by law and contractual agreements.
Synovus has reviewed investment securities that are in an unrealized loss position as of September 30, 2017 and December 31, 2016 for OTTI and does not consider any securities in an unrealized loss position to be other-than-temporarily impaired. If Synovus intended to sell a security in an unrealized loss position, the entire unrealized loss would be reflected in earnings. Synovus does not intend to sell investment securities in an unrealized loss position prior to the recovery of the unrealized loss, which may not be until maturity, and has the ability and intent to hold those securities for that period of time. Additionally, Synovus is not currently aware of any circumstances which will require it to sell any of the securities that are in an unrealized loss position prior to the respective securities' recovery of all such unrealized losses.
Declines in the fair value of available for sale securities below their cost that are deemed to have OTTI are reflected in earnings as realized losses to the extent the impairment is related to credit losses. The amount of the impairment related to other factors is recognized in other comprehensive income. Currently, unrealized losses on debt securities are attributable to increases in interest rates on comparable securities from the date of purchase. Synovus regularly evaluates its investment securities portfolio to ensure that there are no conditions that would indicate that unrealized losses represent OTTI. These factors include the length of time the security has been in a loss position, the extent that the fair value is below amortized cost, and the credit standing of the issuer. As of September 30, 2017, Synovus had 75 investment securities in a loss position for less than twelve months and 13 investment securities in a loss position for twelve months or longer.

10


Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2017 and December 31, 2016 are presented below.
 
September 30, 2017
 
Less than 12 Months
 
12 Months or Longer
 
Total
(in thousands)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
U.S. Treasury securities
$
64,351

 
369

 

 

 
64,351

 
369

Mortgage-backed securities issued by U.S. Government agencies
80,303

 
552

 
7,636

 
300

 
87,939

 
852

Mortgage-backed securities issued by U.S. Government sponsored enterprises
1,696,906

 
19,128

 
48,596

 
896

 
1,745,502

 
20,024

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
569,191

 
5,617

 
240,355

 
6,526

 
809,546

 
12,143

Corporate debt and other securities

 

 
5,081

 
216

 
5,081

 
216

    Total
$
2,410,751

 
25,666

 
301,668

 
7,938

 
2,712,419

 
33,604

 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
Less than 12 Months
 
12 Months or Longer
 
Total
(in thousands)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
U.S. Treasury securities
$
64,023

 
644

 

 

 
64,023

 
644

Mortgage-backed securities issued by U.S. Government agencies
128,121

 
1,240

 
3,626

 
114

 
131,747

 
1,354

Mortgage-backed securities issued by U.S. Government sponsored enterprises
2,123,181

 
42,571

 

 

 
2,123,181

 
42,571

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
682,492

 
15,653

 
24,801

 
908

 
707,293

 
16,561

Corporate debt and other securities
14,952

 
48

 
4,888

 
359

 
19,840

 
407

Total
$
3,012,769

 
60,156

 
33,315

 
1,381

 
3,046,084

 
61,537

 
 
 
 
 
 
 
 
 
 
 
 

11


The amortized cost and fair value by contractual maturity of investment securities available for sale at September 30, 2017 are shown below. The expected life of mortgage-backed securities or CMOs may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. For purposes of the maturity table, mortgage-backed securities and CMOs, which are not due at a single maturity date, have been classified based on the final contractual maturity date.
 
Distribution of Maturities at September 30, 2017
(in thousands)
Within One
Year
 
1 to 5
Years
 
5 to 10
Years
 
More Than
10 Years
 
No Stated
Maturity
 
Total
Amortized Cost
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
$
18,830

 
64,720

 

 

 

 
83,550

U.S. Government agency securities
2,331

 
6,437

 
2,004

 

 

 
10,772

Mortgage-backed securities issued by U.S. Government agencies

 

 
32,956

 
94,565

 

 
127,521

Mortgage-backed securities issued by U.S. Government sponsored enterprises
44

 
2,015

 
446,255

 
2,215,645

 

 
2,663,959

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises

 

 
20,910

 
922,673

 

 
943,583

State and municipal securities
180

 

 

 

 

 
180

Corporate debt and other securities

 

 
15,000

 
2,000

 
3,297

 
20,297

Total amortized cost
$
21,385

 
73,172

 
517,125

 
3,234,883

 
3,297

 
3,849,862

 
 
 
 
 
 
 
 
 
 
 
 
Fair Value
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
$
18,830

 
64,351

 

 

 

 
83,181

U.S. Government agency securities
2,385

 
6,529

 
2,124

 

 

 
11,038

Mortgage-backed securities issued by U.S. Government agencies

 

 
33,073

 
94,311

 

 
127,384

Mortgage-backed securities issued by U.S. Government sponsored enterprises
45

 
2,127

 
444,701

 
2,204,979

 

 
2,651,852

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises

 

 
20,666

 
910,774

 

 
931,440

State and municipal securities
181

 

 

 

 

 
181

Corporate debt and other securities

 

 
15,286

 
1,919

 
3,162

 
20,367

Total fair value
$
21,441

 
73,007

 
515,850

 
3,211,983

 
3,162

 
3,825,443

 
 
 
 
 
 
 
 
 
 
 
 
Proceeds from sales, gross gains, and gross losses on sales of securities available for sale for the nine and three months ended September 30, 2017 and 2016 are presented below. The specific identification method is used to reclassify gains and losses out of other comprehensive income at the time of sale.
 
 
Nine Months Ended September 30,
 
Three Months Ended September 30,
(in thousands)
 
2017
 
2016
 
2017
 
2016
Proceeds from sales of investment securities available for sale
 
$
812,293

 
596,824

 
$
473,912

 
353,215

Gross realized gains on sales
 
7,942

 
2,590

 

 
1,635

Gross realized losses on sales
 
(8,231
)
 
(2,464
)
 
(7,956
)
 
(1,576
)
Investment securities (losses) gains, net
 
$
(289
)
 
126

 
$
(7,956
)
 
59

 
 
 
 
 
 
 
 
 

12


Note 5 - Restructuring Charges
For the nine and three months ended September 30, 2017 and 2016, total restructuring charges consist of the following components:
 
Nine Months Ended September 30,
 
Three Months Ended September 30,
(in thousands)
2017
 
2016
 
2017
 
2016
Severance charges
$
6,428

 

 
$
(24
)
 

Asset impairment charges
511

 
8,120

 
515

 
1,240

Other charges
104

 
105

 
28

 
3

Total restructuring charges, net
$
7,043

 
8,225

 
$
519

 
1,243

 
 
 
 
 
 
 
 
Restructuring charges of $7.0 million were recorded during the nine months ended September 30, 2017 consisting primarily of severance charges of $6.4 million recorded during the first quarter of 2017. Severance charges included $6.2 million for termination benefits incurred in conjunction with a voluntary early retirement program offered during the first quarter of 2017. This program was part of Synovus' ongoing efficiency initiatives. The $6.2 million accrual was based on the benefits to be paid to employees who accepted the early retirement offer on or prior to the expiration of the program on March 30, 2017. The accrual balance for severance charges associated with the voluntary early retirement program was $1.2 million at September 30, 2017. For the three months ended September 30, 2017, Synovus recorded restructuring charges of $519 thousand due to additional asset impairment charges of $515 thousand on properties previously identified for disposition. During the nine months ended September 30, 2016, Synovus recorded restructuring charges of $8.2 million with $4.8 million of those charges related to corporate real estate optimization activities and $3.3 million associated with branch closures.
The following tables present aggregate activity within the accrual for restructuring charges for the nine and three months ended September 30, 2017 and 2016:
(in thousands)
Severance Charges
 
Lease Termination Charges
 
Total
Balance at December 31, 2016
$
81

 
3,968

 
4,049

Accruals for voluntary and involuntary termination benefits
6,428

 

 
6,428

Payments
(5,304
)
 
(540
)
 
(5,844
)
Balance at September 30, 2017
$
1,205

 
3,428

 
4,633

 
 
 
 
 
 
Balance at July 1, 2017
3,731

 
3,530

 
7,261

Accruals for voluntary and involuntary termination benefits
(24
)
 

 
(24
)
Payments
(2,502
)
 
(102
)
 
(2,604
)
Balance at September 30, 2017
$
1,205

 
3,428

 
4,633

 
 
 
 
 
 
(in thousands)
Severance Charges
 
Lease Termination Charges
 
Total
Balance at December 31, 2015
$
1,930

 
4,687

 
6,617

Accruals for lease terminations

 
6

 
6

Payments
(1,702
)
 
(533
)
 
(2,235
)
Balance at September 30, 2016
$
228

 
4,160

 
4,388

 
 
 
 
 
 
Balance at July 1, 2016
593

 
4,375

 
4,968

Accruals for lease terminations

 
(25
)
 
(25
)
Payments
(365
)
 
(190
)
 
(555
)
Balance at September 30, 2016
$
228

 
4,160

 
4,388

 
 
 
 
 
 
All other charges were paid in the quarters that they were incurred. No other restructuring charges resulted in payment accruals.

13


Note 6 - Loans and Allowance for Loan Losses
The following is a summary of current, accruing past due, and non-accrual loans by portfolio class as of September 30, 2017 and December 31, 2016.
Current, Accruing Past Due, and Non-accrual Loans
 
 
September 30, 2017
 
(in thousands)
Current
 
Accruing 30-89 Days Past Due
 
Accruing 90 Days or Greater Past Due
 
Total Accruing Past Due
 
Non-accrual
 
 Total
 
Investment properties
$
5,919,393

 
3,454

 
186

 
3,640

 
2,063

 
5,925,096

 
1-4 family properties
784,520

 
6,588

 
796

 
7,384

 
2,712

 
794,616

 
Land and development
494,488

 
5,732

 
65

 
5,797

 
6,927

 
507,212

 
Total commercial real estate
7,198,401

 
15,774

 
1,047

 
16,821

 
11,702

 
7,226,924

 
Commercial, financial and agricultural
6,871,204

 
30,010

 
2,356

 
32,366

 
58,139

 
6,961,709

 
Owner-occupied
4,751,269

 
9,586

 
618

 
10,204

 
3,960

 
4,765,433

 
Total commercial and industrial
11,622,473

 
39,596

 
2,974

 
42,570

 
62,099

 
11,727,142

 
Home equity lines
1,505,556

 
7,535

 
160

 
7,695

 
15,638

 
1,528,889

 
Consumer mortgages
2,545,986

 
5,225

 
137

 
5,362

 
6,332

 
2,557,680

 
Credit cards
222,176

 
2,312

 
1,237

 
3,549

 

 
225,725

 
Other consumer loans
1,234,355

 
8,726

 
130

 
8,856

 
2,067

 
1,245,278

 
Total consumer
5,508,073

 
23,798

 
1,664

 
25,462

 
24,037

 
5,557,572

 
Total loans
$
24,328,947

 
79,168

 
5,685

 
84,853

 
97,838

 
24,511,638

(1 
) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
(in thousands)
Current
 
Accruing 30-89 Days Past Due
 
Accruing 90 Days or Greater Past Due
 
Total Accruing Past Due
 
Non-accrual
 
 Total
 
Investment properties
$
5,861,198

 
2,795

 

 
2,795

 
5,268

 
5,869,261

 
1-4 family properties
873,231

 
4,801

 
161

 
4,962

 
9,114