Commitments and Guarantees

Commitments to Extend Credit

To accommodate the financial needs its customers, the Corporation issues off-balance sheet financial instruments in connection with commercial and consumer lending activities. The credit risk associated with these instruments is essentially the same as that involved in extending loans to customers and is subject to the Corporation's normal credit approval policies. The Corporation maintains an allowance to cover probable credit losses inherent in lending-related commitments. The reserve for unfunded lending commitments at March 31, 2015, December 31, 2014, and March 31, 2014, included in “accrued expenses and other liabilities” on the Consolidated Balance Sheets, was $4.3 million, $5.8 million, and $7.5 million, respectively.

The Corporation's credit risk associated with these instruments is represented by the contractual amounts indicated in the following table.



Unused commitments to extend credit
(In thousands)		March 31, 2015		December 31, 2014		March 31, 2014
	Commercial	$	3,691,193	$	3,748,690	$	3,394,877
	Consumer	2,343,677		2,387,623		2,237,324
	Total unused commitments to extend credit	$	6,034,870	$	6,136,313	$	5,632,201

Unused Commitments to Extend Credit. Commitments to extend credit are legally binding agreements to lend to a customer, provided there is no violation of any condition established in the contract. These commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties. Since many commitments expire without being drawn upon, the total contractual amount of commitments does not necessarily represent future cash requirements of the Corporation.

Loan commitments to originate residential mortgage loans held for sale and forward commitments to sell residential mortgage loans are considered derivative instruments, and the fair value of these commitments is recorded on the consolidated balance sheets. Additional information is provided in Note 8 (Derivatives and Hedging Activities).

Guarantees

The Corporation is a guarantor in certain agreements with third parties. The Corporation's maximum credit risk associated with these instruments is represented by the contractual amounts indicated in the following table.



Financial guarantees
(In thousands)		March 31, 2015		December 31, 2014		March 31, 2014
	Standby letters of credit	$	275,736	$	242,390	$	194,118
	Loans sold with recourse	39,996		45,071		38,072
	Total financial guarantees	$	315,732	$	287,461	$	232,190

Standby Letters of Credit. Standby letters of credit obligate the Corporation to pay a specified third party when a customer fails to repay an outstanding loan or debt instrument, or fails to perform some contractual nonfinancial obligation. The Corporation has recourse against the customer for any amount required to be paid to a third party under a standby letter of credit. Collateral held varies, but may include marketable securities, equipment, inventory, and real estate. Except for short-term guarantees of $199.8 million at March 31, 2015, the remaining guarantees extend in varying amounts through 2019.

Loans Sold with Recourse. The Corporation regularly sells service retained residential mortgage loans to GSEs as part of its mortgage banking activities. The Corporation provides customary representation and warranties to the GSEs in conjunction with these sales. These representations and warranties generally require the Corporation to repurchase assets if it is subsequently determined that a loan did not meet specified criteria, such as a documentation deficiency or rescission of mortgage insurance. If the Corporation is unable to cure or refute a repurchase request, the Corporation is generally obligated to repurchase the loan or otherwise reimburse the counterparty for losses. The Corporation also sells service released residential mortgage loans to other investors which contain early payment default recourse provisions. As of March 31, 2015, December 31, 2014, and March 31, 2014, the Corporation had sold $33.1 million, $38.1 million, and $27.5 million, respectively, of outstanding residential mortgage loans to GSEs and other investors with recourse provisions. The Corporation had reserved $6.7 million, $7.3 million, and $8.2 million as of March 31, 2015, December 31, 2014, and March 31, 2014, respectively, for estimated losses from representation and warranty obligations and early payment default recourse provisions.

Due to prior acquisitions, as of March 31, 2015, the Corporation continued to service approximately $3.7 million in manufactured housing loans that were sold with recourse compared to $3.7 million and $6.4 million as of December 31, 2014 and March 31, 2014. As of March 31, 2015, the Corporation had reserved $1.1 million for potential losses from these manufactured housing loans, consistent with the reserve balance at December 31, 2014 and March 31, 2014.

The total reserve associated with loans sold with recourse was approximately $7.8 million, $8.4 million, and $9.3 million as of March 31, 2015, December 31, 2014, and March 31, 2014, respectively, and is included in accrued taxes, expenses and other liabilities on the Consolidated Balance Sheets. The Corporation's reserve reflects Management's best estimate of losses. The Corporation's reserving methodology uses current information about investor repurchase requests, and assumptions about repurchase mix and loss severity, based upon the Corporation's most recent loss trends. The Corporation also considers qualitative factors that may result in anticipated losses differing from historical loss trends, such as loan vintage, underwriting characteristics and macroeconomic trends.

Changes in the amount of the repurchase reserve for the three months ended March 31, 2015 and 2014 are as follows:



	Three Months Ended March 31, 2015
(In thousands)	Reserve on residential mortgage loans			Reserve on manufactured housing loans		Total repurchase reserve
Balance at beginning of period	$	7,250		$	1,124	$	8,374
Net realized losses	(198		)	—		(198		)
Net increase (decrease) to reserve	(402		)	2		(400		)
Balance at end of period	$	6,650		$	1,126	$	7,776



	Three Months Ended March 31, 2014
(In thousands)	Reserve on residential mortgage loans			Reserve on manufactured housing loans		Total repurchased reserve
Balance at beginning of period	$	8,737		$	1,114	$	9,851
Net realized losses	(2,593		)	—		(2,593		)
Net increase to reserve	2,056			3		2,059
Balance at end of period	$	8,200		$	1,117	$	9,317