Loans and the Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2021

Schedule of Recorded Investment in Loans by Category

The recorded investment in loans is presented in the Consolidated Balance Sheets net of deferred loan fees and costs, and discounts on purchased loans. Net deferred loan income was $13.3 million and $6.2 million at March 31, 2021 and December 31, 2020, respectively. At March 31, 2021 and December 31, 2020, respectively, the balance included $21.4 and $13.8 million of net deferred income from PPP loans. The un-accreted discount on purchased loans from acquisitions was $35.9 million at March 31, 2021 and $39.4 million at December 31, 2020.

	March 31,		December 31,
(unaudited, in thousands)	2021		2020
Commercial real estate:
Land and construction	$	642,017	$	668,277
Improved property		5,070,725		5,037,115
Total commercial real estate		5,712,742		5,705,392
Commercial and industrial		1,598,921		1,681,182
Commercial and industrial - PPP		823,814		726,256
Residential real estate		1,644,422		1,720,961
Home equity		634,018		646,387
Consumer		289,395		309,055
Total portfolio loans		10,703,312		10,789,233
Loans held for sale		153,520		168,378
Total loans	$	10,856,832	$	10,957,611

Summary of Changes in Allowance for Credit Losses

The following tables summarize changes in the allowance for credit losses applicable to each category of the loan portfolio:

	Allowance for Credit Losses By Category
	For the Three Months Ended March 31, 2021 and 2020
(unaudited, in thousands)	Commercial Real Estate - Land and Construction			Commercial Real Estate- Improved Property			Commercial & Industrial			Residential Real Estate			Home Equity			Consumer			Deposit Overdrafts			Total
Balance at December 31, 2020
Allowance for credit losses - loans	$	10,841		$	110,652		$	37,850		$	17,851		$	1,487		$	6,507		$	639		$	185,827
Allowance for credit losses - loan commitments		6,508			712			1,275			955			45			19			—			9,514
Total beginning allowance for credit losses - loans and loan commitments		17,349			111,364			39,125			18,806			1,532			6,526			639			195,341
Provision for credit losses:
Provision for loan losses		(3,538	)		(11,420	)		(4,256	)		(4,177	)		(394	)		(1,510	)		156			(25,139	)
Provision for loan commitments		(2,508	)		(504	)		308			(86	)		5			2			—			(2,783	)
Total provision for credit losses - loans and loan commitments		(6,046	)		(11,924	)		(3,948	)		(4,263	)		(389	)		(1,508	)		156			(27,922	)
Charge-offs		(18	)		(19	)		(750	)		(371	)		(174	)		(927	)		(201	)		(2,460	)
Recoveries		55			528			440			135			79			462			113			1,812
Net charge-offs		37			509			(310	)		(236	)		(95	)		(465	)		(88	)		(648	)
Balance at March 31, 2021
Allowance for credit losses - loans		7,340			99,741			33,284			13,438			998			4,532			707			160,040
Allowance for credit losses - loan commitments		4,000			208			1,583			869			50			21			—			6,731
Total ending allowance for credit losses - loans and loan commitments	$	11,340		$	99,949		$	34,867		$	14,307		$	1,048		$	4,553		$	707		$	166,771

Balance at December 31, 2019
Allowance for credit losses - loans	$	4,949		$	20,293		$	14,116		$	4,311		$	4,422		$	2,951		$	1,387		$	52,429
Allowance for credit losses - loan commitments		235			22			311			15			250			41			—			874
Total beginning allowance for credit losses - loans and loan commitments		5,184			20,315			14,427			4,326			4,672			2,992			1,387			53,303
Impact of adopting ASC 326		1,524			13,078			22,357			5,630			(3,936	)		2,576			213			41,442
Provision for credit losses:
Provision for loan losses		2,564			20,585			5,632			237			646			(1,241	)		(351	)		28,072
Provision for loan commitments		2,274			—			(582	)		49			2			—			—			1,743
Total provision for credit losses - loans and loan commitments		4,838			20,585			5,050			286			648			(1,241	)		(351	)		29,815
Charge-offs		(1	)		(1,398	)		(2,714	)		(386	)		(443	)		(856	)		(328	)		(6,126	)
Recoveries		8			293			107			272			172			415			143			1,410
Net charge-offs		7			(1,105	)		(2,607	)		(114	)		(271	)		(441	)		(185	)		(4,716	)
Balance at March 31, 2020
Allowance for credit losses - loans		6,442			52,873			39,227			9,684			1,096			3,886			1,064			114,272
Allowance for credit losses - loan commitments		5,111			—			—			444			17			—			—			5,572
Total ending allowance for credit losses - loans and loan commitments	$	11,553		$	52,873		$	39,227		$	10,128		$	1,113		$	3,886		$	1,064		$	119,844

Allowance for Credit Losses and Recorded Investments in Loans

The following tables present the allowance for credit losses and recorded investments in loans by category, as of each period-end:

	Allowance for Credit Losses and Recorded Investment in Loans
(unaudited, in thousands)	Commercial Real Estate- Land and Construction		Commercial Real Estate- Improved Property		Commercial and Industrial		Residential Real Estate		Home Equity		Consumer		Deposit Over- drafts		Total
March 31, 2021
Allowance for credit losses:
Loans individually-evaluated	$	503	$	4,035	$	1,501	$	—	$	—	$	—	$	—	$	6,039
Loans collectively-evaluated		6,837		95,706		31,783		13,438		998		4,532		707		154,001
Loan commitments		4,000		208		1,583		869		50		21		—		6,731
Total allowance for credit losses - loans and commitments	$	11,340	$	99,949	$	34,867	$	14,307	$	1,048	$	4,553	$	707	$	166,771

Portfolio loans:
Individually-evaluated for credit losses⁽¹⁾	$	1,125	$	40,158	$	1,838	$	—	$	—	$	—	$	—	$	43,121
Collectively-evaluated for credit losses		640,892		5,030,567		2,420,897		1,644,422		634,018		289,395		—		10,660,191
Total portfolio loans	$	642,017	$	5,070,725	$	2,422,735	$	1,644,422	$	634,018	$	289,395	$	—	$	10,703,312

December 31, 2020
Allowance for credit losses:
Loans individually-evaluated	$	602	$	4,196	$	1,484	$	—	$	—	$	—	$	—	$	6,282
Loans collectively-evaluated		10,239		106,456		36,366		17,851		1,487		6,507		639		179,545
Loan commitments		6,508		712		1,275		955		45		19		—		9,514
Total allowance for credit losses - loans and commitments	$	17,349	$	111,364	$	39,125	$	18,806	$	1,532	$	6,526	$	639	$	195,341

Portfolio loans:
Individually-evaluated for credit losses⁽¹⁾	$	1,455	$	40,372	$	2,863	$	—	$	—	$	—	$	—	$	44,690
Collectively-evaluated for credit losses		666,822		4,996,743		2,404,575		1,720,961		646,387		309,055		—		10,744,543
Total portfolio loans	$	668,277	$	5,037,115	$	2,407,438	$	1,720,961	$	646,387	$	309,055	$	—	$	10,789,233

⁽¹⁾	^{Commercial loans greater than $1 million that are reported as non-accrual or as a TDR are individually evaluated for credit loss.}

Summary of Commercial Loans by Risk Grade

The following tables summarize commercial loans by their assigned risk grade:

	Commercial Loans by Internally Assigned Risk Grade
(unaudited, in thousands)	Commercial Real Estate- Land and Construction		Commercial Real Estate- Improved Property		Commercial & Industrial		Total Commercial Loans
As of March 31, 2021
Pass	$	634,835	$	4,679,257	$	2,365,558	$	7,679,650
Criticized - compromised		5,360		297,801		37,782		340,943
Classified - substandard		1,822		93,667		19,395		114,884
Classified - doubtful		—		—		—		—
Total	$	642,017	$	5,070,725	$	2,422,735	$	8,135,477

As of December 31, 2020
Pass	$	657,435	$	4,609,726	$	2,350,724	$	7,617,885
Criticized - compromised		7,397		320,301		34,597		362,295
Classified - substandard		3,445		107,088		22,117		132,650
Classified - doubtful		—		—		—		—
Total	$	668,277	$	5,037,115	$	2,407,438	$	8,112,830

Summary of Age Analysis of Loan Categories

The following tables summarize the age analysis of all categories of loans:

	Age Analysis of Loans
(unaudited, in thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Total Loans		90 Days or More Past Due and Accruing (1)
As of March 31, 2021
Commercial real estate:
Land and construction	$	639,378	$	1,120	$	759	$	760	$	2,639	$	642,017	$	641
Improved property		5,055,419		4,041		1,984		9,281		15,306		5,070,725		1,955
Total commercial real estate		5,694,797		5,161		2,743		10,041		17,945		5,712,742		2,596
Commercial and industrial		2,408,663		4,823		2,657		6,592		14,072		2,422,735		5,314
Residential real estate		1,625,328		2,713		1,589		14,792		19,094		1,644,422		4,007
Home equity		628,773		1,213		197		3,835		5,245		634,018		784
Consumer		287,395		1,428		340		232		2,000		289,395		123
Total portfolio loans		10,644,956		15,338		7,526		35,492		58,356		10,703,312		12,824
Loans held for sale		153,520		—		—		—		—		153,520		—
Total loans	$	10,798,476	$	15,338	$	7,526	$	35,492	$	58,356	$	10,856,832	$	12,824

Nonperforming loans included above are as follows:
Non-accrual loans	$	9,960	$	940	$	1,100	$	22,575	$	24,615	$	34,575
TDRs accruing interest ⁽¹⁾		3,248		63		159		93		315		3,563
Total nonperforming loans	$	13,208	$	1,003	$	1,259	$	22,668	$	24,930	$	38,138

As of December 31, 2020
Commercial real estate:
Land and construction	$	664,990	$	582	$	2,276	$	429	$	3,287	$	668,277	$	288
Improved property		5,016,812		4,876		4,118		11,309		20,303		5,037,115		2,713
Total commercial real estate		5,681,802		5,458		6,394		11,738		23,590		5,705,392		3,001
Commercial and industrial		2,395,844		4,372		2,197		5,025		11,594		2,407,438		1,899
Residential real estate		1,698,636		2,614		5,654		14,057		22,325		1,720,961		2,863
Home equity		639,319		2,414		775		3,879		7,068		646,387		706
Consumer		305,483		1,998		1,031		543		3,572		309,055		377
Total portfolio loans		10,721,084		16,856		16,051		35,242		68,149		10,789,233		8,846
Loans held for sale		168,378		—		—		—		—		168,378		—
Total loans	$	10,889,462	$	16,856	$	16,051	$	35,242	$	68,149	$	10,957,611	$	8,846

Nonperforming loans included above are as follows:
Non-accrual loans	$	9,560	$	630	$	466	$	26,224	$	27,320	$	36,880
TDRs accruing interest ⁽¹⁾		3,540		63		152		172		387		3,927
Total nonperforming loans	$	13,100	$	693	$	618	$	26,396	$	27,707	$	40,807

⁽¹⁾	Loans 90 days or more past due and accruing interest exclude TDRs 90 days or more past due and accruing interest.

Summary of Nonperforming Loans

The following tables summarize nonperforming loans:

	Nonperforming Loans
	March 31, 2021						December 31, 2020
	Unpaid						Unpaid
	Principal		Recorded		Related		Principal		Recorded		Related
(unaudited, in thousands)	Balance (1)		Investment		Allowance		Balance (1)		Investment		Allowance
With no related specific allowance recorded:
Commercial real estate:
Land and construction	$	138	$	120	$	—	$	469	$	469	$	—
Improved property		8,719		7,349		—		9,597		8,055	—
Commercial and industrial		1,860		1,675		—		4,401		3,413	—
Residential real estate		23,605		20,990		—		23,055		20,704	—
Home equity		6,518		5,569		—		6,635		5,708	—
Consumer		593		351		—		602		364	—
Total nonperforming loans without a specific allowance		41,433		36,054		—		44,759		38,713		—
With a specific allowance recorded:
Commercial real estate:
Land and construction		—		—		—	—		—		—
Improved property		2,094		2,084		175		2,094		2,094		136
Commercial and industrial		—		—		—	—		—		—
Residential real estate		—		—		—	—		—		—
Home equity		—		—		—	—		—		—
Consumer		—		—		—	—		—		—
Total nonperforming loans with a specific allowance		2,094		2,084		175		2,094		2,094		136
Total nonperforming loans	$	43,527	$	38,138	$	175	$	46,853	$	40,807	$	136

⁽¹⁾	^{The difference between the unpaid principal balance and the recorded investment generally reflects amounts that have been previously charged-off and fair market value adjustments on acquired nonperforming loans.}

	Nonperforming Loans
	For the Three Months Ended
	March 31, 2021				March 31, 2020
	Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income
(unaudited, in thousands)	Investment		Recognized		Investment		Recognized
With no related specific allowance recorded:
Commercial real estate:
Land and construction	$	295	$	—	$	393	$	—
Improved property		7,702		9		5,501		20
Commercial and industrial		2,544		1		8,570		3
Residential real estate		20,847		39		18,470		55
Home equity		5,639		6		5,811		6
Consumer		358		—		390		1
Total nonperforming loans without a specific allowance		37,385		55		39,135		85
With a specific allowance recorded:
Commercial real estate:
Land and construction		—		—		—		—
Improved property		2,089		—		3,270		—
Commercial and industrial		—		—		96		—
Residential real estate		—		—		2,196		—
Home equity		—		—		352		—
Consumer		—		—		27		—
Total nonperforming loans with a specific allowance		2,089		—		5,941		—
Total nonperforming loans	$	39,474	$	55	$	45,076	$	85

Recorded Investment in Non-Accrual Loans and TDRs

The following tables present the recorded investment in non-accrual loans and TDRs:

	Non-accrual Loans ⁽¹⁾
	March 31,		December 31,
(unaudited, in thousands)	2021		2020
Commercial real estate:
Land and construction	$	120	$	469
Improved property		9,007		9,494
Total commercial real estate		9,127		9,963
Commercial and industrial		1,571		3,302
Residential real estate		18,358		17,925
Home equity		5,181		5,345
Consumer		338		345
Total	$	34,575	$	36,880

⁽¹⁾	At March 31, 2021 and December 31, 2020, there was one borrower with a loan balance greater than $1.0 million totaling $2.1 million. Total non-accrual loans include loans that are also restructured. Such loans are also set forth in the following table as non-accrual TDRs.

	TDRs
	March 31, 2021						December 31, 2020
(unaudited, in thousands)	Accruing		Non-Accrual		Total		Accruing		Non-Accrual		Total
Commercial real estate:
Land and construction	$	—	$	—	$	—	$	—	$	—	$	—
Improved property		426		157		583		655		165		820
Total commercial real estate		426		157		583		655		165		820
Commercial and industrial		104		—		104		111		—		111
Residential real estate		2,632		1,353		3,985		2,779		1,354		4,133
Home equity		388		253		641		363		300		663
Consumer		13		5		18		19		9		28
Total	$	3,563	$	1,768	$	5,331	$	3,927	$	1,828	$	5,755

Loans Identified as TDRs

The following tables present details related to loans identified as TDRs during the three months ended March 31, 2021 and 2020, respectively:

	New TDRs (1)
	For the Three Months Ended
	March 31, 2021						March 31, 2020
			Pre-		Post-				Pre-		Post-
			Modification		Modification				Modification		Modification
			Outstanding		Outstanding				Outstanding		Outstanding
	Number of		Recorded		Recorded		Number of		Recorded		Recorded
(unaudited, dollars in thousands)	Modifications		Investment		Investment		Modifications		Investment		Investment
Commercial real estate:
Land and construction		—	$	—	$	—		—	$	—	$	—
Improved Property		—		—		—		—		—		—
Total commercial real estate		—		—		—		—		—		—
Commercial and industrial		—		—		—		—		—		—
Residential real estate		—		—		—		2		332		330
Home equity		—		—		—		—		—		—
Consumer		—		—		—		—		—		—
Total		—	$	—	$	—		2	$	332	$	330

(1) Excludes loans that were either paid off or charged-off by period end. The pre-modification balance represents the balance outstanding at the beginning of the period. The post-modification balance represents the outstanding balance at period end.

The following table summarizes TDRs which defaulted (defined as past due 90 days) during the three months ended March 31, 2021 and 2020, respectively, that were restructured within the last twelve months prior to March 31, 2021 and 2020, respectively:

	Defaulted TDRs ⁽¹⁾
	For the Three Months Ended
	March 31, 2021				March 31, 2020
	Number of		Recorded		Number of		Recorded
(unaudited, dollars in thousands)	Defaults		Investment		Defaults		Investment
Commercial real estate:
Land and construction		—	$	—		—	$	—
Improved property		—		—		—		—
Total commercial real estate		—		—		—		—
Commercial and industrial		—		—		1		13
Residential real estate		—		—		1		155
Home equity		—		—		—		—
Consumer		—		—		—		—
Total		—	$	—		2	$	168

⁽¹⁾	^{Excludes loans that were either charged-off or cured by period end. The recorded investment is as of March 31, 2021 and 2020, respectively.}

Summary of Amortized Cost Basis Loan Balances by Year of Origination and Credit Quality Indicator

	Loans As of March 31, 2021
	Amortized Cost Basis by Origination Year
(unaudited, in thousands)	2021		2020		2019		2018		2017		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
Commercial real estate: land and construction
Risk rating:
Pass	$	30,840	$	164,939	$	296,600	$	49,749	$	27,064	$	43,143	$	22,500	$	—	$	634,835
Criticized - compromised		—		875		—		39		228		3,618		600		—		5,360
Classified - substandard		—		—		—		74		40		1,708		—		—		1,822
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	30,840	$	165,814	$	296,600	$	49,862	$	27,332	$	48,469	$	23,100	$	—	$	642,017

Commercial real estate: improved property
Risk rating:
Pass	$	156,789	$	787,296	$	690,398	$	639,915	$	472,801	$	1,864,909	$	67,149	$	—	$	4,679,257
Criticized - compromised		—		1,892		53,807		17,473		53,576		150,704		20,349		—		297,801
Classified - substandard		—		222		28,603		1,860		7,171		55,811		—		—		93,667
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	156,789	$	789,410	$	772,808	$	659,248	$	533,548	$	2,071,424	$	87,498	$	—	$	5,070,725

Commercial and industrial
Risk rating:
Pass	$	401,323	$	685,632	$	232,322	$	185,484	$	135,856	$	320,788	$	404,023	$	130	$	2,365,558
Criticized - compromised		26		3,290		2,746		4,236		2,651		10,841		13,992		—		37,782
Classified - substandard		985		—		2,518		1,668		3,567		5,179		5,478		—		19,395
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	402,334	$	688,922	$	237,586	$	191,388	$	142,074	$	336,808	$	423,493	$	130	$	2,422,735

Residential real estate
Loan delinquency:
Current	$	66,997	$	392,577	$	209,234	$	130,435	$	94,237	$	731,848	$	—	$	—	$	1,625,328
30-59 days past due		—		—		—		79		—		2,634		—		—		2,713
60-89 days past due		—		—		—		272		113		1,204		—		—		1,589
90 days or more past due		—		—		379		784		761		12,868		—		—		14,792
Total	$	66,997	$	392,577	$	209,613	$	131,570	$	95,111	$	748,554	$	—	$	—	$	1,644,422

Home equity
Loan delinquency:
Current	$	4,724	$	15,055	$	3,290	$	2,959	$	857	$	16,995	$	573,653	$	11,240	$	628,773
30-59 days past due		—		—		—		—		—		400		783		30		1,213
60-89 days past due		—		—		—		—		—		121		76		—		197
90 days or more past due		—		—		—		19		150		1,565		1,355		746		3,835
Total	$	4,724	$	15,055	$	3,290	$	2,978	$	1,007	$	19,081	$	575,867	$	12,016	$	634,018

Consumer
Loan delinquency:
Current	$	18,121	$	65,802	$	79,045	$	33,586	$	18,773	$	51,313	$	20,589	$	166	$	287,395
30-59 days past due		37		444		413		68		114		352		—		—		1,428
60-89 days past due		—		45		50		31		64		148		2		—		340
90 days or more past due		—		8		—		54		29		125		16		—		232
Total	$	18,158	$	66,299	$	79,508	$	33,739	$	18,980	$	51,938	$	20,607	$	166	$	289,395

	Loans As of December 31, 2020
	Amortized Cost Basis by Origination Year
(unaudited, in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
Commercial real estate: land and construction
Risk rating:
Pass	$	133,720	$	314,614	$	109,232	$	27,483	$	16,404	$	29,685	$	26,297	$	—	$	657,435
Criticized - compromised		459		—		1,532		233		79		3,778		1,316		—		7,397
Classified - substandard		—		—		403		58		291		2,693		—		—		3,445
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	134,179	$	314,614	$	111,167	$	27,774	$	16,774	$	36,156	$	27,613	$	—	$	668,277

Commercial real estate: improved property
Risk rating:
Pass	$	809,516	$	670,554	$	646,629	$	474,622	$	572,733	$	1,346,552	$	89,120	$	—	$	4,609,726
Criticized - compromised		2,693		67,261		16,793		59,251		42,284		130,247		1,772		—		320,301
Classified - substandard		102		16,366		4,946		11,647		18,460		55,567		—		—		107,088
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	812,311	$	754,181	$	668,368	$	545,520	$	633,477	$	1,532,366	$	90,892	$	—	$	5,037,115

Commercial and industrial
Risk rating:
Pass	$	977,085	$	240,262	$	193,712	$	160,924	$	85,379	$	265,890	$	427,336	$	136	$	2,350,724
Criticized - compromised		453		2,726		4,206		2,795		324		11,640		12,453		—		34,597
Classified - substandard		—		3,817		1,947		3,771		1,603		5,073		5,906		—		22,117
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	977,538	$	246,805	$	199,865	$	167,490	$	87,306	$	282,603	$	445,695	$	136	$	2,407,438

Residential real estate
Loan delinquency:
Current	$	385,541	$	242,770	$	149,603	$	108,090	$	170,967	$	641,665	$	—	$	—	$	1,698,636
30-59 days past due		—		—		320		533		—		1,761		—		—		2,614
60-89 days past due		—		—		823		—		185		4,646		—		—		5,654
90 days or more past due		—		483		166		761		819		11,828		—		—		14,057
Total	$	385,541	$	243,253	$	150,912	$	109,384	$	171,971	$	659,900	$	—	$	—	$	1,720,961

Home equity
Loan delinquency:
Current	$	18,191	$	3,611	$	3,334	$	975	$	1,110	$	16,477	$	583,486	$	12,135	$	639,319
30-59 days past due		124		—		34		—		—		882		1,247		127		2,414
60-89 days past due		—		—		—		—		—		14		749		12		775
90 days or more past due		—		—		8		156		88		1,786		1,075		766		3,879
Total	$	18,315	$	3,611	$	3,376	$	1,131	$	1,198	$	19,159	$	586,557	$	13,040	$	646,387

Consumer
Loan delinquency:
Current	$	72,847	$	89,637	$	39,584	$	22,118	$	13,144	$	45,735	$	22,253	$	165	$	305,483
30-59 days past due		481		408		210		311		194		379		15		—		1,998
60-89 days past due		273		147		84		100		163		253		11		—		1,031
90 days or more past due		113		72		73		31		12		242		—		—		543
Total	$	73,714	$	90,264	$	39,951	$	22,560	$	13,513	$	46,609	$	22,279	$	165	$	309,055

Summary of Other Real Estate Owned and Repossessed Assets

The following table summarizes other real estate owned and repossessed assets included in other assets:

	March 31,		December 31,
(unaudited, in thousands)	2021		2020
Other real estate owned	$	375	$	504
Repossessed assets		18		45
Total other real estate owned and repossessed assets	$	393	$	549