Loans and leases and the allowance for credit losses (Tables)

9 Months Ended

Sep. 30, 2016

Outstanding Principal Balance and Carrying Amount of Loans that is Included in Consolidated Balance Sheet

The outstanding principal balance and the carrying amount of loans acquired at a discount that were recorded at fair value at the acquisition date and included in the consolidated balance sheet were as follows:

	September 30,		December 31,
	2016		2015
	(in thousands)
Outstanding principal balance	$	2,556,085		3,122,935
Carrying amount:
Commercial, financial, leasing, etc.		62,244		78,847
Commercial real estate		504,406		644,284
Residential real estate		845,976		1,016,129
Consumer		609,400		725,807
	$	2,022,026		2,465,067

Summary of Changes in Accretable Yield for Acquired Loans

A summary of changes in the accretable yield for loans acquired at a discount for the three months and nine months ended September 30, 2016 and 2015 follows:

	Three months ended September 30
	2016						2015
	Purchased			Other			Purchased			Other
	impaired			acquired			impaired			acquired
	(in thousands)
Balance at beginning of period	$	162,023			245,195		$	77,624			344,989
Interest income		(12,784	)		(26,540	)		(5,865	)		(37,396	)
Reclassifications from nonaccretable balance		2,256			12,050			47			769
Other (a)		—			(818	)		—			4,697
Balance at end of period	$	151,495			229,887		$	71,806			313,059

	Nine months ended September 30
	2016						2015
	Purchased			Other			Purchased			Other
	impaired			acquired			impaired			acquired
	(in thousands)
Balance at beginning of period	$	184,618			296,434		$	76,518			397,379
Interest income		(40,906	)		(97,300	)		(16,843	)		(118,697	)
Reclassifications from nonaccretable balance		7,783			20,647			12,131			27,792
Other (a)		—			10,106			—			6,585
Balance at end of period	$	151,495			229,887		$	71,806			313,059

(a)	Other changes in expected cash flows including changes in interest rates and prepayment assumptions.

Summary of Current, Past Due and Nonaccrual Loans

A summary of current, past due and nonaccrual loans as of September 30, 2016 and December 31, 2015 follows:

	Current		30-89 days past due		Accruing loans past due 90 days or more (a)		Accruing loans acquired at a discount past due 90 days or more (b)		Purchased impaired (c)		Nonaccrual		Total
September 30, 2016	(in thousands)
Commercial, financial, leasing, etc.	$	21,601,646		70,597		10,831		1,893		795		231,401	$	21,917,163
Real estate:
Commercial		24,283,146		116,651		15,926		13,292		32,775		157,527		24,619,317
Residential builder and developer		1,814,299		16,993		4,476		3,262		18,096		20,118		1,877,244
Other commercial construction		5,525,684		20,238		—		198		15,412		20,669		5,582,201
Residential		18,438,396		494,767		281,023		12,510		401,551		213,896		19,842,143
Residential-limited documentation		3,400,578		105,621		—		—		146,722		89,356		3,742,277
Consumer:
Home equity lines and loans		5,586,704		40,406		—		13,014		1,640		79,623		5,721,387
Automobile		2,805,779		46,347		—		4		—		14,453		2,866,583
Other		3,410,790		31,033		5,026		21,009		—		10,319		3,478,177
Total	$	86,867,022		942,653		317,282		65,182		616,991		837,362	$	89,646,492

December 31, 2015
Commercial, financial, leasing, etc.	$	20,122,648		52,868		2,310		693		1,902		241,917	$	20,422,338
Real estate:
Commercial (d)		23,111,673		172,439		12,963		8,790		46,790		179,606		23,532,261
Residential builder and developer		1,507,856		7,969		5,760		6,925		28,734		28,429		1,585,673
Other commercial construction (d)		3,962,620		65,932		7,936		2,001		24,525		16,363		4,079,377
Residential		20,507,551		560,312		284,451		16,079		488,599		153,281		22,010,273
Residential-limited documentation		3,885,073		137,289		—		—		175,518		61,950		4,259,830
Consumer:
Home equity lines and loans		5,805,222		45,604		—		15,222		2,261		84,467		5,952,776
Automobile		2,446,473		56,181		—		6		—		16,597		2,519,257
Other		3,051,435		36,702		4,021		18,757		—		16,799		3,127,714
Total	$	84,400,551		1,135,296		317,441		68,473		768,329		799,409	$	87,489,499

(a)	Excludes loans acquired at a discount.

(b)	Loans acquired at a discount that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.

(c)	Accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value.

(d)	The Company expanded its definition of construction loans in 2016 and, as a result, re-characterized certain commercial real estate loans as other commercial construction loans. The December 31, 2015 balances reflect such changes.

Changes in Allowance for Credit Losses

Changes in the allowance for credit losses for the three months ended September 30, 2016 were as follows:

	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Unallocated		Total
	(in thousands)
Beginning balance	$	316,079			349,674			69,660			157,361			77,722	$	970,496
Provision for credit losses		26,222			9,963			(6,232	)		16,539			508		47,000
Net charge-offs
Charge-offs		(21,075	)		(1,564	)		(6,754	)		(29,882	)		—		(59,275	)
Recoveries		6,958			1,704			1,919			7,319			—		17,900
Net charge-offs		(14,117	)		140			(4,835	)		(22,563	)		—		(41,375	)
Ending balance	$	328,184			359,777			58,593			151,337			78,230	$	976,121

Changes in the allowance for credit losses for the three months ended September 30, 2015 were as follows:

	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Unallocated			Total
	(in thousands)
Beginning balance	$	286,750			311,294			60,294			194,238			77,411		$	929,987
Provision for credit losses		21,507			1,879			(3,155	)		24,448			(679	)		44,000
Net charge-offs
Charge-offs		(26,912	)		(2,203	)		(3,268	)		(20,758	)		—			(53,141	)
Recoveries		5,322			2,119			1,125			4,386			—			12,952
Net charge-offs		(21,590	)		(84	)		(2,143	)		(16,372	)		—			(40,189	)
Ending balance	$	286,667			313,089			54,996			202,314			76,732		$	933,798

Changes in the allowance for credit losses for the nine months ended September 30, 2016 were as follows:

	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Unallocated		Total
	(in thousands)
Beginning balance	$	300,404			326,831			72,238			178,320			78,199	$	955,992
Provision for credit losses		39,667			29,799			(610	)		59,113			31		128,000
Net charge-offs
Charge-offs		(34,711	)		(3,569	)		(18,816	)		(107,761	)		—		(164,857	)
Recoveries		22,824			6,716			5,781			21,665			—		56,986
Net charge-offs		(11,887	)		3,147			(13,035	)		(86,096	)		—		(107,871	)
Ending balance	$	328,184			359,777			58,593			151,337			78,230	$	976,121

Changes in the allowance for credit losses for the nine months ended September 30, 2015 were as follows:

	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Unallocated		Total
	(in thousands)
Beginning balance	$	288,038			307,927			61,910			186,033			75,654	$	919,562
Provision for credit losses		32,686			13,769			(571	)		65,038			1,078		112,000
Net charge-offs
Charge-offs		(46,990	)		(12,352	)		(9,695	)		(64,542	)		—		(133,579	)
Recoveries		12,933			3,745			3,352			15,785			—		35,815
Net charge-offs		(34,057	)		(8,607	)		(6,343	)		(48,757	)		—		(97,764	)
Ending balance	$	286,667			313,089			54,996			202,314			76,732	$	933,798

Impaired Loans and Leases

The following tables provide information with respect to loans and leases that were considered impaired as of September 30, 2016 and December 31, 2015 and for the three-month and nine-month periods ended September 30, 2016 and 2015.

	September 30, 2016						December 31, 2015
	Recorded investment		Unpaid principal balance		Related allowance		Recorded investment		Unpaid principal balance		Related allowance
	(in thousands)
With an allowance recorded:
Commercial, financial, leasing, etc.	$	192,805		212,009		55,020		179,037		195,821		44,752
Real estate:
Commercial		75,749		85,137		14,939		85,974		95,855		18,764
Residential builder and developer		8,142		8,923		714		3,316		5,101		196
Other commercial construction		2,729		3,092		1,103		3,548		3,843		348
Residential		79,036		97,466		3,144		79,558		96,751		4,727
Residential-limited documentation		83,296		97,984		6,200		90,356		104,251		8,000
Consumer:
Home equity lines and loans		42,862		46,844		7,697		25,220		26,195		3,777
Automobile		18,033		19,218		3,737		22,525		22,525		4,709
Other		4,122		5,122		864		17,620		17,620		4,820
		506,774		575,795		93,418		507,154		567,962		90,093
With no related allowance recorded:
Commercial, financial, leasing, etc.		72,429		80,757		—		93,190		110,735		—
Real estate:
Commercial		90,425		104,508		—		101,340		116,230		—
Residential builder and developer		17,346		23,617		—		27,651		47,246		—
Other commercial construction		18,265		37,432		—		13,221		31,477		—
Residential		18,079		26,127		—		19,621		30,940		—
Residential-limited documentation		17,611		27,936		—		18,414		31,113		—
		234,155		300,377		—		273,437		367,741		—
Total:
Commercial, financial, leasing, etc.		265,234		292,766		55,020		272,227		306,556		44,752
Real estate:
Commercial		166,174		189,645		14,939		187,314		212,085		18,764
Residential builder and developer		25,488		32,540		714		30,967		52,347		196
Other commercial construction		20,994		40,524		1,103		16,769		35,320		348
Residential		97,115		123,593		3,144		99,179		127,691		4,727
Residential-limited documentation		100,907		125,920		6,200		108,770		135,364		8,000
Consumer:
Home equity lines and loans		42,862		46,844		7,697		25,220		26,195		3,777
Automobile		18,033		19,218		3,737		22,525		22,525		4,709
Other		4,122		5,122		864		17,620		17,620		4,820
Total	$	740,929		876,172		93,418		780,591		935,703		90,093

Interest Income Recognized on Impaired Loans

	Three months ended September 30, 2016						Three months ended September 30, 2015
			Interest income recognized						Interest income recognized
	Average recorded investment		Total		Cash basis		Average recorded investment		Total		Cash basis
	(in thousands)
Commercial, financial, leasing, etc.	$	262,796		744		744		242,157		1,017		1,017
Real estate:
Commercial		175,256		1,806		1,806		179,327		2,327		2,327
Residential builder and developer		26,996		405		405		53,009		81		81
Other commercial construction		21,500		190		190		17,236		1,943		1,943
Residential		96,961		1,572		570		99,939		1,835		1,316
Residential-limited documentation		101,877		1,501		378		116,191		1,539		618
Consumer:
Home equity lines and loans		41,740		368		112		21,952		231		66
Automobile		18,571		303		19		24,429		391		39
Other		4,077		72		11		19,238		188		23
Total	$	749,774		6,961		4,235		773,478		9,552		7,430

	Nine months ended September 30, 2016						Nine months ended September 30, 2015
			Interest income recognized						Interest income recognized
	Average recorded investment		Total		Cash basis		Average recorded investment		Total		Cash basis
	(in thousands)
Commercial, financial, leasing, etc.	$	283,783		7,055		7,055		226,243		2,123		2,123
Real estate:
Commercial		177,579		3,891		3,891		161,834		4,433		4,433
Residential builder and developer		30,832		488		488		64,165		275		275
Other commercial construction		19,774		563		563		22,130		2,166		2,166
Residential		97,229		4,778		2,591		101,997		4,639		3,011
Residential-limited documentation		104,382		4,580		1,648		120,710		4,799		1,962
Consumer:
Home equity lines and loans		33,998		937		295		20,619		656		179
Automobile		20,358		964		83		26,521		1,257		136
Other		10,987		371		74		19,053		547		86
Total	$	778,922		23,627		16,688		763,272		20,895		14,371

Summary of Loan Grades

			Real Estate
	Commercial,				Residential		Other
	Financial,				Builder and		Commercial
	Leasing, etc.		Commercial		Developer		Construction
	(in thousands)
September 30, 2016
Pass	$	20,825,301		23,540,787		1,699,263		5,405,719
Criticized accrual		860,461		921,003		157,863		155,813
Criticized nonaccrual		231,401		157,527		20,118		20,669
Total	$	21,917,163		24,619,317		1,877,244		5,582,201
December 31, 2015
Pass	$	19,442,183		22,697,398		1,497,465		3,834,137
Criticized accrual		738,238		655,257		59,779		228,877
Criticized nonaccrual		241,917		179,606		28,429		16,363
Total	$	20,422,338		23,532,261		1,585,673		4,079,377

Allocation of Allowance for Credit Losses on Basis of Company's Impairment Methodology

The allocation of the allowance for credit losses summarized on the basis of the Company’s impairment methodology was as follows:

	Commercial, Financial,		Real Estate
	Leasing, etc.		Commercial		Residential		Consumer		Total
	(in thousands)
September 30, 2016
Individually evaluated for impairment	$	55,020		16,608		9,344		12,298	$	93,270
Collectively evaluated for impairment		273,164		340,737		48,500		138,193		800,594
Purchased impaired		—		2,432		749		846		4,027
Allocated	$	328,184		359,777		58,593		151,337		897,891
Unallocated										78,230
Total									$	976,121
December 31, 2015
Individually evaluated for impairment	$	44,752		19,175		12,727		13,306	$	89,960
Collectively evaluated for impairment		255,615		307,000		57,624		163,511		783,750
Purchased impaired		37		656		1,887		1,503		4,083
Allocated	$	300,404		326,831		72,238		178,320		877,793
Unallocated										78,199
Total									$	955,992

Recorded Investment in Loans and Leases on Basis of Company's Impairment Methodology

The recorded investment in loans and leases summarized on the basis of the Company’s impairment methodology was as follows:

	Commercial, Financial,		Real Estate
	Leasing, etc.		Commercial		Residential		Consumer		Total
	(in thousands)
September 30, 2016
Individually evaluated for impairment	$	265,234		211,730		198,022		65,017	$	740,003
Collectively evaluated for impairment		21,651,134		31,800,749		22,838,125		11,999,490		88,289,498
Purchased impaired		795		66,283		548,273		1,640		616,991
Total	$	21,917,163		32,078,762		23,584,420		12,066,147	$	89,646,492
December 31, 2015
Individually evaluated for impairment	$	272,227		234,132		207,949		65,365	$	779,673
Collectively evaluated for impairment		20,148,209		28,863,130		25,398,037		11,532,121		85,941,497
Purchased impaired		1,902		100,049		664,117		2,261		768,329
Total	$	20,422,338		29,197,311		26,270,103		11,599,747	$	87,489,499

Loan Modification Activities that were Considered Troubled Debt Restructurings

The tables that follow summarize the Company’s loan modification activities that were considered troubled debt restructurings for the three months ended September 30, 2016 and 2015:

			Recorded investment				Financial effects of modification
Three months ended September 30, 2016	Number		Pre- modification		Post- modification		Recorded investment (a)			Interest (b)
	(dollars in thousands)
Commercial, financial, leasing, etc.
Principal deferral		30	$	41,652	$	40,183	$	(1,469	)	$	—
Combination of concession types		13		27,834		19,802		(8,032	)		(6	)
Real estate:
Commercial
Principal deferral		14		12,302		11,644		(658	)		—
Combination of concession types		4		2,623		2,614		(9	)		(172	)
Residential
Principal deferral		21		4,489		4,714		225			—
Combination of concession types		9		1,149		1,214		65			(120	)
Residential-limited documentation
Principal deferral		3		435		470		35			—
Combination of concession types		3		392		493		101			(123	)
Consumer:
Home equity lines and loans
Principal deferral		4		251		251		—			—
Combination of concession types		22		2,301		2,301		—			(178	)
Automobile
Principal deferral		10		186		186		—			—
Other
Principal deferral		1		26		26		—			—
Total		134	$	93,640	$	83,898	$	(9,742	)	$	(599	)

(a)	Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages.

(b)	Represents the present value of interest rate concessions discounted at the effective rate of the original loan.

			Recorded investment				Financial effects of modification
Three months ended September 30, 2015	Number		Pre- modification		Post- modification		Recorded investment (a)			Interest (b)
	(dollars in thousands)
Commercial, financial, leasing, etc.
Principal deferral		36	$	7,893	$	7,419	$	(474	)	$	—
Combination of concession types		1		31		31		—			(6	)
Real estate:
Commercial
Principal deferral		15		4,230		4,208		(22	)		—
Combination of concession types		1		1,156		1,169		13			(54	)
Other commercial construction
Principal deferral		3		296		390		94			—
Residential
Principal deferral		31		3,540		3,743		203			—
Other		1		267		267		—			—
Combination of concession types		10		1,296		1,380		84			(178	)
Residential-limited documentation
Principal deferral		1		265		276		11			—
Combination of concession types		4		605		662		57			(91	)
Consumer:
Home equity lines and loans
Principal deferral		4		727		727		—			—
Combination of concession types		22		2,003		2,003		—			(199	)
Automobile
Principal deferral		35		316		316		—			—
Other		15		93		93		—			—
Combination of concession types		25		471		471		—			(17	)
Other
Principal deferral		24		352		352		—			—
Other		5		33		33		—			—
Combination of concession types		12		117		117		—			(12	)
Total		245	$	23,691	$	23,657	$	(34	)	$	(557	)

(a)	Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages.

(b)	Represents the present value of interest rate concessions discounted at the effective rate of the original loan.

The tables below summarize the Company’s loan modification activities that were considered troubled debt restructurings for the nine months ended September 30, 2016 and 2015:

			Recorded investment				Financial effects of modification
Nine months ended September 30, 2016	Number		Pre- modification		Post- modification		Recorded investment (a)			Interest (b)
	(dollars in thousands)
Commercial, financial, leasing, etc.
Principal deferral		87	$	98,956	$	98,561	$	(395	)	$	—
Combination of concession types		25		49,248		39,971		(9,277	)		(6	)
Real estate:
Commercial
Principal deferral		40		18,511		17,802		(709	)		—
Interest rate reduction		1		129		129		—			(25	)
Other		1		4,723		4,447		(276	)		—
Combination of concession types		13		13,621		13,546		(75	)		(238	)
Residential builder and developer
Principal deferral		3		23,905		22,958		(947	)		—
Other commercial construction
Principal deferral		1		250		250		—			—
Combination of concession types		1		124		124		—			—
Residential
Principal deferral		46		7,433		7,945		512			—
Combination of concession types		27		4,513		4,705		192			(120	)
Residential-limited documentation
Principal deferral		6		711		803		92			—
Combination of concession types		8		1,704		1,872		168			(462	)
Consumer:
Home equity lines and loans
Principal deferral		8		655		655		—			—
Combination of concession types		76		8,534		8,534		—			(741	)
Automobile
Principal deferral		102		865		865		—			—
Other		38		55		55		—			—
Combination of concession types		8		85		85		—			(3	)
Other
Principal deferral		56		951		951		—			—
Other		5		45		45		—			—
Combination of concession types		17		196		196		—			(32	)
Total		569	$	235,214	$	224,499	$	(10,715	)	$	(1,627	)

(a)	Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages.

(b)	Represents the present value of interest rate concessions discounted at the effective rate of the original loan.

			Recorded investment				Financial effects of modification
Nine months ended September 30, 2015	Number		Pre- modification		Post- modification		Recorded investment (a)			Interest (b)
	(dollars in thousands)
Commercial, financial, leasing, etc.
Principal deferral		87	$	25,483	$	24,331	$	(1,152	)	$	—
Interest rate reduction		1		99		99		—			(19	)
Other		2		8,991		8,883		(108	)		—
Combination of concession types		6		25,075		24,884		(191	)		(245	)
Real estate:
Commercial
Principal deferral		37		47,005		45,569		(1,436	)		—
Combination of concession types		6		3,238		3,242		4			(159	)
Residential builder and developer
Principal deferral		2		10,650		10,598		(52	)		—
Other commercial construction
Principal deferral		3		296		390		94			—
Residential
Principal deferral		50		4,954		5,239		285			—
Other		1		267		267		—			—
Combination of concession types		22		2,551		2,795		244			(356	)
Residential-limited documentation
Principal deferral		2		426		437		11			—
Combination of concession types		7		1,239		1,298		59			(121	)
Consumer:
Home equity lines and loans
Principal deferral		6		1,946		1,946		—			—
Combination of concession types		41		3,555		3,555		—			(424	)
Automobile
Principal deferral		133		1,234		1,234		—			—
Interest rate reduction		7		137		137		—			(10	)
Other		38		134		134		—			—
Combination of concession types		42		693		693		—			(28	)
Other
Principal deferral		73		1,418		1,418		—			—
Other		12		113		113		—			—
Combination of concession types		35		384		384		—			(44	)
Total		613	$	139,888	$	137,646	$	(2,242	)	$	(1,406	)

(a)	Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages.

(b)	Represents the present value of interest rate concessions discounted at the effective rate of the original loan.