Loans, Allowance for Loan and Lease Losses, and Reserve for Off-Balance Sheet Credit Commitments (Tables)

9 Months Ended

Sep. 30, 2013

Loans, Allowance for Loan and Lease Losses, and Reserve for Off-Balance Sheet Credit Commitments

Summary of loans

Loans and Leases

	September 30,			December 31,
(in thousands)	2013			2012
Commercial	$	7,126,158		$	6,211,353
Commercial real estate mortgages	3,077,183			2,739,284
Residential mortgages	4,418,231			3,962,205
Real estate construction	380,489			313,190
Home equity loans and lines of credit	681,879			711,750
Installment	152,107			142,793
Lease financing	730,086			737,720
Loans and leases, excluding covered loans	16,566,133			14,818,295
Less: Allowance for loan and lease losses	(295,947		)	(277,888		)
Loans and leases, excluding covered loans, net	16,270,186			14,540,407
Covered loans	780,072			1,031,004
Less: Allowance for loan losses	(25,882		)	(44,781		)
Covered loans, net	754,190			986,223
Total loans and leases.	$	17,346,205		$	15,849,299
Total loans and leases, net	$	17,024,376		$	15,526,630

Summary of major categories of covered loans

	September 30,			December 31,
(in thousands)	2013			2012
Commercial	$	10,015		$	10,561
Commercial real estate mortgages	719,207			931,758
Residential mortgages	5,030			5,652
Real estate construction	41,625			78,554
Home equity loans and lines of credit	3,672			3,790
Installment	523			689
Covered loans	780,072			1,031,004
Less: Allowance for loan losses	(25,882		)	(44,781		)
Covered loans, net	$	754,190		$	986,223

Schedule of information on covered loans and loss-sharing terms by acquired entity

(in thousands)	Imperial Capital Bank		1st Pacific Bank		Sun West Bank		Nevada Commerce Bank		Total
Carrying value of covered loans as of:
September 30, 2013	$	680,427	$	45,123	$	25,948	$	28,574	$	780,072
December 31, 2012	$	893,031	$	70,240	$	34,803	$	32,930	$	1,031,004
Expiration date of FDIC loss sharing:
Commercial (1)	12/31/2016		6/30/2015		6/30/2015		6/30/2016
Residential	12/31/2019		5/30/2020		5/30/2020		4/30/2021
Termination date of FDIC loss-sharing agreements:
Commercial (1)	12/19/2017		5/8/2018		5/29/2018		6/30/2019
Residential	12/31/2019		5/30/2020		5/30/2020		4/30/2021

(1) The Company is subject to sharing 80% of its recoveries with the FDIC up to the termination dates of the commercial loss-sharing agreements.

Summary of accretable yield for acquired impaired loans

	For the nine months ended September 30,
(in thousands)	2013			2012
Balance, beginning of period	$	295,813		$	436,374
Accretion	(48,424		)	(62,189		)
Reclassifications from (to) nonaccretable yield	26,990			(4,042		)
Disposals and other	(41,930		)	(51,854		)
Balance, end of period	$	232,449		$	318,289

Summary of allowance for loan and lease losses on non-covered loans

(in thousands)	Commercial (1)			Commercial Real Estate Mortgages			Residential Mortgages			Real Estate Construction			Home Equity Loans and Lines of Credit			Installment			Unallocated		Total
Three months ended September 30, 2013
Allowance for loan and lease losses:
Beginning balance	$	116,619		$	53,339		$	8,004		$	8,335		$	5,400		$	1,355		$	96,862	$	289,914
Provision (reduction) for credit losses (2)	(14,173		)	(2,829		)	5,070			(1,589		)	3,092			317			9,363		(749		)
Charge-offs	(488		)	(1,270		)	—			—			(225		)	(18		)	—		(2,001		)
Recoveries	4,863			686			40			2,945			31			218			—		8,783
Net recoveries (charge-offs)	4,375			(584		)	40			2,945			(194		)	200			—		6,782
Ending balance	$	106,821		$	49,926		$	13,114		$	9,691		$	8,298		$	1,872		$	106,225	$	295,947
Nine months ended September 30, 2013
Allowance for loan and lease losses:
Beginning balance	$	104,731		$	48,901		$	10,558		$	11,784		$	7,283		$	1,858		$	92,773	$	277,888
Provision (reduction) for credit losses (2)	(7,313		)	572			2,547			(10,386		)	946			(854		)	13,452		(1,036		)
Charge-offs	(4,719		)	(1,315		)	(106		)	(100		)	(500		)	(370		)	—		(7,110		)
Recoveries	14,122			1,768			115			8,393			569			1,238			—		26,205
Net recoveries (charge-offs)	9,403			453			9			8,293			69			868			—		19,095
Ending balance	$	106,821		$	49,926		$	13,114		$	9,691		$	8,298		$	1,872		$	106,225	$	295,947
Ending balance of allowance:
Individually evaluated for impairment	$	344		$	602		$	232		$	—		$	—		$	—		$	—	$	1,178
Collectively evaluated for impairment	106,477			49,324			12,882			9,691			8,298			1,872			106,225		294,769
Loans and leases, excluding covered loans
Ending balance of loans and leases:
Loans and leases, excluding covered loans	$	7,856,244		$	3,077,183		$	4,418,231		$	380,489		$	681,879		$	152,107		$	—	$	16,566,133
Individually evaluated for impairment	32,727			38,546			6,767			30,190			2,350			—			—		110,580
Collectively evaluated for impairment	7,823,517			3,038,637			4,411,464			350,299			679,529			152,107			—		16,455,553

(1) Includes lease financing loans.

(2) Provision for credit losses in the allowance rollforward for the three months ended September 30, 2013 includes total transfers to the reserve for off-balance sheet credit commitments of $0.7 million. Provision for credit losses in the allowance rollforward for the nine months ended September 30, 2013 includes total transfers to the reserve for off-balance sheet credit commitments of $1.0 million. There was no other provision for credit losses recognized for the three and nine months ended September 30, 2013.

(in thousands)	Commercial (1)			Commercial Real Estate Mortgages			Residential Mortgages			Real Estate Construction			Home Equity Loans and Lines of Credit			Installment			Unallocated			Total
Three months ended September 30, 2012
Allowance for loan and lease losses:
Beginning balance	$	93,981		$	49,715		$	12,490		$	14,810		$	7,656		$	1,774		$	89,108		$	269,534
Provision (reduction) for credit losses (2)	6,333			(1,298		)	1,327			(3,898		)	47			(314		)	(1,106		)	1,091
Charge-offs	(12,163		)	(444		)	(1,030		)	(310		)	(43		)	(134		)	—			(14,124		)
Recoveries	7,227			203			495			3,415			11			588			—			11,939
Net (charge-offs) recoveries	(4,936		)	(241		)	(535		)	3,105			(32		)	454			—			(2,185		)
Ending balance	$	95,378		$	48,176		$	13,282		$	14,017		$	7,671		$	1,914		$	88,002		$	268,440
Nine months ended September 30, 2012
Allowance for loan and lease losses:
Beginning balance	$	83,514		$	48,451		$	14,122		$	20,155		$	8,077		$	1,972		$	86,266		$	262,557
Provision (reduction) for credit losses (2)	3,425			(481		)	732			(4,508		)	588			(655		)	1,736			837
Charge-offs	(22,382		)	(1,318		)	(2,333		)	(9,769		)	(1,077		)	(959		)	—			(37,838		)
Recoveries	30,821			1,524			761			8,139			83			1,556			—			42,884
Net (charge-offs) recoveries	8,439			206			(1,572		)	(1,630		)	(994		)	597			—			5,046
Ending balance	$	95,378		$	48,176		$	13,282		$	14,017		$	7,671		$	1,914		$	88,002		$	268,440
Ending balance of allowance:
Individually evaluated for impairment	$	1,167		$	1,874		$	185		$	1,467		$	138		$	—		$	—		$	4,831
Collectively evaluated for impairment	94,211			46,302			13,097			12,550			7,533			1,914			88,002			263,609
Loans and leases, excluding covered loans
Ending balance of loans and leases:
Loans and leases, excluding covered loans	$	6,264,562		$	2,436,218		$	3,897,690		$	269,583		$	718,966		$	137,632		$	—		$	13,724,651
Individually evaluated for impairment	34,731			58,217			11,342			56,582			4,496			449			—			165,817
Collectively evaluated for impairment	6,229,831			2,378,001			3,886,348			213,001			714,470			137,183			—			13,558,834

(1) Includes lease financing loans.

(2) Provision for credit losses in the allowance rollforward for the three months ended September 30, 2012 includes total provision expense of $2.0 million, net of total transfers to the reserve for off-balance sheet credit commitments of $0.9 million. Provision for credit losses for the nine months ended September 30, 2012 includes total provision expense of $3.0 million, net of total transfers to the reserve for off-balance sheet credit commitments of $2.2 million.

Summary of activity in the reserve for off-balance sheet credit commitments

	For the three months ended September 30,				For the nine months ended September 30,
(in thousands)	2013		2012		2013		2012
Balance, beginning of period	$	25,124	$	24,351	$	24,837	$	23,097
Transfers from allowance for loan and lease losses	749		909		1,036		2,163
Balance, end of period	$	25,873	$	25,260	$	25,873	$	25,260

Schedule of impaired loans, excluding covered loans

							For the three months ended				For the nine months ended
			Unpaid				September 30, 2013				September 30, 2013
			Contractual				Average		Interest		Average		Interest
	Recorded		Principal		Related		Recorded		Income		Recorded		Income
(in thousands)	Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
September 30, 2013
With no related allowance recorded:
Commercial	$	25,233	$	25,488	$	—	$	26,255	$	593	$	22,584	$	1,440
Commercial real estate mortgages	33,133		37,754		—		29,977		440		33,060		1,102
Residential mortgages:
Fixed	2,031		2,155		—		2,019		33		2,860		75
Variable	3,062		3,418		—		3,670		47		4,062		116
Total residential mortgages	5,093		5,573		—		5,689		80		6,922		191
Real estate construction:
Construction	16,259		21,064		—		16,262		233		17,904		791
Land	13,931		27,092		—		14,056		224		16,506		511
Total real estate construction	30,190		48,156		—		30,318		457		34,410		1,302
Home equity loans and lines of credit	2,350		3,375		—		2,803		47		2,827		81
Installment:
Consumer	—		—		—		—		—		112		—
Total installment	—		—		—		—		—		112		—
Total with no related allowance	$	95,999	$	120,346	$	—	$	95,042	$	1,617	$	99,915	$	4,116
With an allowance recorded:
Commercial	$	7,494	$	9,168	$	344	$	7,567	$	156	$	7,556	$	513
Commercial real estate mortgages	5,413		5,810		602		10,262		45		11,018		361
Residential mortgages:
Fixed	—		—		—		—		—		116		—
Variable	1,674		1,688		232		1,684		14		842		55
Total residential mortgages	1,674		1,688		232		1,684		14		958		55
Real estate construction:
Land	—		—		—		—		—		3,213		213
Total real estate construction	—		—		—		—		—		3,213		213
Home equity loans and lines of credit	—		—		—		—		—		225		—
Total with an allowance	$	14,581	$	16,666	$	1,178	$	19,513	$	215	$	22,970	$	1,142
Total impaired loans by type:
Commercial	$	32,727	$	34,656	$	344	$	33,822	$	749	$	30,140	$	1,953
Commercial real estate mortgages	38,546		43,564		602		40,239		485		44,078		1,463
Residential mortgages	6,767		7,261		232		7,373		94		7,880		246
Real estate construction	30,190		48,156		—		30,318		457		37,623		1,515
Home equity loans and lines of credit	2,350		3,375		—		2,803		47		3,052		81
Installment	—		—		—		—		—		112		—
Total impaired loans	$	110,580	$	137,012	$	1,178	$	114,555	$	1,832	$	122,885	$	5,258

(in thousands)	Recorded Investment		Unpaid Contractual Principal  Balance		Related Allowance
December 31, 2012
With no related allowance recorded:
Commercial	$	18,761	$	24,135	$	—
Commercial real estate mortgages	42,882		49,110		—
Residential mortgages:
Fixed	3,482		3,757		—
Variable	4,865		5,437		—
Total residential mortgages	8,347		9,194		—
Real estate construction:
Construction	19,762		33,267		—
Land	25,748		41,016		—
Total real estate construction	45,510		74,283		—
Home equity loans and lines of credit	3,562		4,660		—
Installment:
Consumer	449		927		—
Total installment	449		927		—
Total with no related allowance	$	119,511	$	162,309	$	—
With an allowance recorded:
Commercial	$	7,516	$	8,038	$	952
Commercial real estate mortgages	10,203		10,783		1,326
Residential mortgages:
Fixed	463		507		9
Total residential mortgages	463		507		9
Home equity loans and lines of credit	899		965		116
Total with an allowance	$	19,081	$	20,293	$	2,403
Total impaired loans by type:
Commercial	$	26,277	$	32,173	$	952
Commercial real estate mortgages	53,085		59,893		1,326
Residential mortgages	8,810		9,701		9
Real estate construction	45,510		74,283		—
Home equity loans and lines of credit	4,461		5,625		116
Installment	449		927		—
Total impaired loans	$	138,592	$	182,602	$	2,403

							For the three months ended				For the nine months ended
			Unpaid				September 30, 2012				September 30, 2012
			Contractual				Average		Interest		Average		Interest
	Recorded		Principal		Related		Recorded		Income		Recorded		Income
(in thousands)	Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
September 30, 2012
With no related allowance recorded:
Commercial	$	28,575	$	39,624	$	—	$	30,476	$	—	$	24,732	$	—
Commercial real estate mortgages	40,825		46,081		—		34,597		34		25,767		158
Residential mortgages:
Fixed	4,199		4,613		—		3,014		—		3,047		—
Variable	3,528		3,968		—		4,893		9		5,010		48
Total residential mortgages	7,727		8,581		—		7,907		9		8,057		48
Real estate construction:
Construction	29,446		42,870		—		34,137		245		29,189		487
Land	19,038		23,606		—		18,987		35		22,763		35
Total real estate construction	48,484		66,476		—		53,124		280		51,952		522
Home equity loans and lines of credit	3,297		4,370		—		3,252		—		4,470		—
Installment:													—
Consumer	449		927		—		500		—		552		—
Total installment	449		927		—		500		—		552		—
Lease financing	—		—		—		—		—		7		—
Total with no related allowance	$	129,357	$	166,059	$	—	$	129,856	$	323	$	115,537	$	728
With an allowance recorded:
Commercial	$	6,156	$	6,922	$	1,167	$	8,461	$	—	$	11,286	$	—
Commercial real estate mortgages	17,392		18,962		1,874		17,257		—		13,406		—
Residential mortgages:
Fixed	2,229		2,336		181		2,260		—		1,844		—
Variable	1,386		1,476		4		2,321		4		1,879		4
Total residential mortgages	3,615		3,812		185		4,581		4		3,723		4
Real estate construction:
Land	8,098		18,362		1,467		8,432		—		14,700		—
Total real estate construction	8,098		18,362		1,467		8,432		—		14,700		—
Home equity loans and lines of credit	1,199		1,406		138		1,213		—		1,166		—
Total with an allowance	$	36,460	$	49,464	$	4,831	$	39,944	$	4	$	44,281	$	4
Total impaired loans by type:
Commercial	$	34,731	$	46,546	$	1,167	$	38,937	$	—	$	36,018	$	—
Commercial real estate mortgages	58,217		65,043		1,874		51,854		34		39,173		158
Residential mortgages	11,342		12,393		185		12,488		13		11,780		52
Real estate construction	56,582		84,838		1,467		61,556		280		66,652		522
Home equity loans and lines of credit	4,496		5,776		138		4,465		—		5,636		—
Installment	449		927		—		500		—		552		—
Lease financing	—		—		—		—		—		7		—
Total impaired loans	$	165,817	$	215,523	$	4,831	$	169,800	$	327	$	159,818	$	732

Schedule of troubled debt restructured loans

The following table provides a summary of loans modified in a troubled debt restructuring during the three months ended September 30, 2013 and 2012:

(in thousands)	Number of Contracts	Pre-Modification Outstanding Principal		Period-End Outstanding Principal		Financial Effects (1)
Three months ended September 30, 2013
Commercial	2	$	7,575	$	7,486	$	344
Total troubled debt restructured loans	2	$	7,575	$	7,486	$	344
Three months ended September 30, 2012
Commercial	6	$	1,624	$	1,538	$	10,528
Residential mortgages:
Fixed	3	1,578		1,078		485
Real estate construction:
Land	1	8,420		8,098		264
Home equity loans and lines of credit	1	257		149		—
Total troubled debt restructured loans	11	$	11,879	$	10,863	$	11,277

(1) Financial effects are comprised of charge-offs and specific reserves recognized on TDR loans at modification date.

The following table provides a summary of loans modified in a troubled debt restructuring during the nine months ended September 30, 2013 and 2012:

(in thousands)	Number of Contracts	Pre-Modification Outstanding Principal		Period-End Outstanding Principal		Financial Effects (1)
Nine months ended September 30, 2013
Commercial	12	$	16,258	$	13,624	$	344
Commercial real estate mortgages	1	547		533		—
Home equity loans and lines of credit	1	345		—		—
Total troubled debt restructured loans	14	$	17,150	$	14,157	$	344
Nine months ended September 30, 2012
Commercial	15	$	36,785	$	23,219	$	10,528
Commercial real estate mortgages	2	15,832		16,353		—
Residential mortgages:
Fixed	4	2,233		1,078		485
Real estate construction:
Construction	3	14,857		14,226		—
Land	1	8,420		8,098		264
Total real estate construction	4	23,277		22,324		264
Home equity loans and lines of credit	1	257		149		—
Total troubled debt restructured loans	26	$	78,384	$	63,123	$	11,277

(1) Financial effects are comprised of charge-offs and specific reserves recognized on TDR loans at modification date.

Schedule of troubled debt restructured loans that have subsequently defaulted

	For three months ended September 30, 2013					For nine months ended September 30, 2013
(in thousands)	Number of Contracts	Period-End Outstanding Principal		Period-End Specific Reserve		Number of Contracts	Period-End Outstanding Principal		Period-End  Specific Reserve
Commercial	—	$	—	$	—	4	$	896	$	—
Real estate construction:
Land	—	—		—		1	7,244		—
Home equity loans and lines of credit	—	—		—		1	139		—
Total loans that subsequently defaulted	—	$	—	$	—	6	$	8,279	$	—

	For three months ended September 30, 2012					For nine months ended September 30, 2012
(in thousands)	Number of Contracts	Period-End Outstanding Principal		Period-End Specific Reserve		Number of Contracts	Period-End Outstanding Principal		Period-End Specific Reserve
Commercial	1	$	688	$	—	5	$	4,581	$	277
Real estate construction:
Land	—	—		—		2	1,372		—
Total loans that subsequently defaulted	1	$	688	$	—	7	$	5,953	$	277

Summary of past due loans, excluding covered loans, based upon the length of time the loans have been past due

(in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days and Accruing		Nonaccrual		Total Past  Due and Nonaccrual Loans		Current		Total Loans and Leases
September 30, 2013
Commercial	$	8,052	$	964	$	3	$	10,073	$	19,092	$	7,107,066	$	7,126,158
Commercial real estate mortgages	2,631		—		—		19,020		21,651		3,055,532		3,077,183
Residential mortgages:
Fixed	—		1,238		379		3,901		5,518		1,457,866		1,463,384
Variable	—		2,375		—		5,773		8,148		2,946,699		2,954,847
Total residential mortgages	—		3,613		379		9,674		13,666		4,404,565		4,418,231
Real estate construction:
Construction	—		—		—		11,553		11,553		339,138		350,691
Land	—		—		—		13,918		13,918		15,880		29,798
Total real estate construction	—		—		—		25,471		25,471		355,018		380,489
Home equity loans and lines of credit	274		—		—		5,289		5,563		676,316		681,879
Installment:
Commercial	—		—		—		—		—		379		379
Consumer	24		—		—		21		45		151,683		151,728
Total installment	24		—		—		21		45		152,062		152,107
Lease financing	—		12		1		54		67		730,019		730,086
Total	$	10,981	$	4,589	$	383	$	69,602	$	85,555	$	16,480,578	$	16,566,133
December 31, 2012
Commercial	$	6,207	$	4,219	$	602	$	9,087	$	20,115	$	6,191,238	$	6,211,353
Commercial real estate mortgages	16,968		3,249		—		33,198		53,415		2,685,869		2,739,284
Residential mortgages:
Fixed	—		1,969		379		4,902		7,250		1,458,224		1,465,474
Variable	—		—		—		4,701		4,701		2,492,030		2,496,731
Total residential mortgages	—		1,969		379		9,603		11,951		3,950,254		3,962,205
Real estate construction:
Construction	—		—		—		15,067		15,067		239,740		254,807
Land	—		859		—		25,815		26,674		31,709		58,383
Total real estate construction	—		859		—		40,882		41,741		271,449		313,190
Home equity loans and lines of credit	3,407		480		—		6,424		10,311		701,439		711,750
Installment:
Commercial	—		—		—		—		—		437		437
Consumer	58		35		—		473		566		141,790		142,356
Total installment	58		35		—		473		566		142,227		142,793
Lease financing	2,633		2		—		120		2,755		734,965		737,720
Total	$	29,273	$	10,813	$	981	$	99,787	$	140,854	$	14,677,441	$	14,818,295

Summary of the loan and lease portfolio, excluding covered loans, by loan type and credit quality classification

	September 30, 2013						December 31, 2012
(in thousands)	Nonclassified		Classified		Total		Nonclassified		Classified		Total
Commercial	$	7,011,906	$	114,252	$	7,126,158	$	6,073,459	$	137,894	$	6,211,353
Commercial real estate mortgages	2,961,319		115,864		3,077,183		2,597,863		141,421		2,739,284
Residential mortgages:
Fixed	1,443,459		19,925		1,463,384		1,449,270		16,204		1,465,474
Variable	2,931,433		23,414		2,954,847		2,479,449		17,282		2,496,731
Total residential mortgages	4,374,892		43,339		4,418,231		3,928,719		33,486		3,962,205
Real estate construction:
Construction	324,908		25,783		350,691		225,577		29,230		254,807
Land	15,589		14,209		29,798		28,710		29,673		58,383
Total real estate construction	340,497		39,992		380,489		254,287		58,903		313,190
Home equity loans and lines of credit	653,349		28,530		681,879		685,011		26,739		711,750
Installment:
Commercial	379		—		379		437		—		437
Consumer	151,370		358		151,728		141,662		694		142,356
Total installment	151,749		358		152,107		142,099		694		142,793
Lease financing	727,500		2,586		730,086		733,803		3,917		737,720
Total	$	16,221,212	$	344,921	$	16,566,133	$	14,415,241	$	403,054	$	14,818,295

Summary of the allowance for loan losses on covered loans

	For the three months ended September 30,						For the nine months ended September 30,
(in thousands)	2013			2012			2013			2012
Balance, beginning of period	$	24,414		$	43,147		$	44,781		$	64,565
Provision for losses	2,496			18,089			461			38,848
Reduction in allowance due to loan removals	(1,028		)	(16,258		)	(19,360		)	(58,435		)
Balance, end of period	$	25,882		$	44,978		$	25,882		$	44,978