Commitments and Guarantees

Commitments to Extend Credit

To accommodate the financial needs of 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 June 30, 2015, December 31, 2014, and June 30, 2014, included in “accrued expenses and other liabilities” on the Consolidated Balance Sheets, was $3.9 million, $5.8 million, and $7.1 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)		June 30, 2015		December 31, 2014		June 30, 2014
	Commercial	$	3,746,824	$	3,748,690	$	3,386,052
	Consumer	2,397,353		2,387,623		2,280,431
	Total unused commitments to extend credit	$	6,144,177	$	6,136,313	$	5,666,483

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)		June 30, 2015		December 31, 2014		June 30, 2014
	Standby letters of credit	$	255,418	$	242,390	$	201,212
	Loans sold with recourse	28,891		45,071		34,662
	Total financial guarantees	$	284,309	$	287,461	$	235,874

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 $145.8 million at June 30, 2015, the remaining guarantees extend in varying amounts through 2022.

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 June 30, 2015, December 31, 2014, and June 30, 2014, the Corporation had sold $22.2 million, $38.1 million, and $24.1 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 $7.9 million as of June 30, 2015, December 31, 2014, and June 30, 2014, respectively, for estimated losses from representation and warranty obligations and early payment default recourse provisions.

Due to prior acquisitions, as of June 30, 2015, the Corporation continued to service approximately $3.7 million in manufactured housing loans that were sold with recourse and had reserved $1.1 million for potential losses from these manufactured housing loans.

The total reserve associated with loans sold with recourse was approximately $7.8 million, $8.4 million, and $9.0 million as of June 30, 2015, December 31, 2014, and June 30, 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 repurchase reserves for the three and six months ended June 30, 2015 and 2014 are as follows:



	Three Months Ended June 30, 2015
(In thousands)	Reserve on residential mortgage loans			Reserve on manufactured housing loans		Total repurchase reserve
Balance at beginning of period	$	6,650		$	1,126	$	7,776
Net increase/(decrease) to reserve	363			—		363
Net realized (losses)/gains	(363		)	2		(361		)
Balance at end of period	$	6,650		$	1,128	$	7,778



	Three Months Ended June 30, 2014
(In thousands)	Reserve on residential mortgage loans			Reserve on manufactured housing loans		Total repurchased reserve
Balance at beginning of period	$	8,200		$	1,117	$	9,317
Net increase/(decrease) to reserve	164			—		164
Net realized (losses)/gains	(464		)	5		(459		)
Balance at end of period	$	7,900		$	1,122	$	9,022



	Six Months Ended June 30, 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 increase/(decrease) to reserve	(39		)	—		(39		)
Net realized (losses) /gains	(561		)	4		(557		)
Balance at end of period	$	6,650		$	1,128	$	7,778



	Six Months Ended June 30, 2014
(In thousands)	Reserve on residential mortgage loans			Reserve on manufactured housing loans		Total repurchase reserve
Balance at beginning of period	$	8,737		$	1,114	$	9,851
Net increase/(decrease) to reserve	2,757			—		2,757
Net realized (losses)/gains	(3,594		)	8		(3,586		)
Balance at end of period	$	7,900		$	1,122	$	9,022