Shareholders' Equity

12 Months Ended

Dec. 31, 2013

Shareholders' Equity

Shareholders' Equity

Note 12. Shareholders' Equity

        On November 7, 2013, the Corporation issued 4 million depositary shares, each representing a 1/40^th interest in a share of 6.75 percent Series D fixed-to-floating rate non-cumulative perpetual preferred stock with a liquidation preference of $1,000 per share (equivalent to $25.00 per depositary share). Net proceeds, after issuance cost, were approximately $97.7 million. Dividends on the preferred stock are payable quarterly, in arrears, if declared by the Corporation's Board of Directors at an annual rate of 6.75 percent beginning February 7, 2014. Effective for the February 7, 2024 dividend payment, the annual rate will adjust to three-month LIBOR plus 4.052 percent. The preferred stock has no maturity date and may be redeemed in whole or in part at the option of the Corporation on any dividend payment date after 10 years from the date of issuance.

        On November 13, 2012, the Corporation issued 7 million depositary shares, each representing a 1/40^th interest in a share of 5.50 percent Series C non-cumulative perpetual preferred stock with a liquidation preference of $1,000 per share (equivalent to $25.00 per depositary share). Net proceeds, after issuance cost, were approximately $169.9 million. Dividends are payable quarterly, in arrears, if declared by the Corporation's Board of Directors. The preferred stock has no maturity date and may be redeemed in whole or in part at the option of the Corporation on any dividend payment date after five years from the date of issuance.

        The components of AOCI at December 31, 2013 and 2012 are as follows:

	December 31,
(in thousands)	2013			2012
Net unrealized (loss) gain on securities available-for-sale	$	(15,641	)	$	86,526
Net unrealized gain on cash flow hedges		—			56
Total accumulated other comprehensive (loss) income	$	(15,641	)	$	86,582

        The following table presents the tax effects allocated to each component of other comprehensive income (loss) for the year ended December 31, 2013, 2012 and 2011:

(in thousands)	Pre-tax			Tax expense (benefit)			Net-of-tax
For the year ended December 31, 2013
Securities available-for-sale:
Net unrealized losses arising during the period	$	(168,824	)	$	(70,619	)	$	(98,205	)
Reclassification adjustment for net gains included in net income (1)		(6,811	)		(2,849	)		(3,962	)
Total securities available-for-sale		(175,635	)		(73,468	)		(102,167	)
Net change on cash flow hedges		(56	)		—			(56	)
Total other comprehensive losses	$	(175,691	)	$	(73,468	)	$	(102,223	)
For the year ended December 31, 2012
Securities available-for-sale:
Net unrealized gains arising during the period	$	24,020		$	10,047		$	13,973
Reclassification adjustment for net gains included in net income (1)		(183	)		(76	)		(107	)
Non-credit related impairment loss		(988	)		(413	)		(575	)
Total securities available-for-sale		22,849			9,558			13,291
Net change on cash flow hedges		(166	)		—			(166	)
Pension liability adjustment (2)		1,085			—			1,085
Total other comprehensive income	$	23,768		$	9,558		$	14,210
For the year ended December 31, 2011
Securities available-for-sale:
Net unrealized gains arising during the period	$	72,499		$	30,326		$	42,173
Reclassification adjustment for net gains included in net income (1)		(4,955	)		(2,073	)		(2,882	)
Non-credit related impairment loss		(4,198	)		(1,756	)		(2,442	)
Total securities available-for-sale		63,346			26,497			36,849
Net change on cash flow hedges		(962	)		—			(962	)
Pension liability adjustment (2)		(368	)		—			(368	)
Total other comprehensive income	$	62,016		$	26,497		$	35,519

(1)

Recognized in Gain on sale of securities in the consolidated statements of income.

(2)

Recognized in Salaries and employee benefits in the consolidated statements of income. See Note 19 for additional information.

        On January 24, 2008, the Board of Directors authorized the repurchase of 1 million shares of City National Corporation stock, following the completion of its previously approved stock buyback initiative. The Corporation did not repurchase any shares of its common stock in 2013, 2012 and 2011 under the repurchase program. As of December 31, 2013, there were 1,140,400 shares that may yet be purchased under the January 24, 2008 buyback initiative. The Corporation received no shares in payment for the exercise price of stock options.

        The following table summarizes the Company's share repurchases for the three months ended December 31, 2013. All repurchases relate to shares withheld or previously owned shares used to pay taxes due upon vesting of restricted stock.

Period	Total Number of Shares (or Units) Purchased		Average Price Paid per Share (or Unit)
October 1, 2013 to October 31, 2013		233	$	70.27
November 1, 2013 to November 30, 2013		28		74.39
December 1, 2013 to December 31, 2013		421		77.35
Total share repurchases		682		74.81