XML 69 R52.htm IDEA: XBRL DOCUMENT v3.8.0.1
Fair value measurements (Tables)
 12 Months Ended
Dec. 31, 2017
Fair Value Disclosures [Abstract]  
Assets and Liabilities Measured at Estimated Fair Value on Recurring Basis

The following tables present assets and liabilities at December 31, 2017 and 2016 measured at estimated fair value on a recurring basis:

 

 

 

Fair Value Measurements

 

 

Level 1 (a)

 

 

Level 2 (a)

 

 

Level 3

 

 

 

(In thousands)

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trading account assets

 

$

132,909

 

 

$

47,873

 

 

$

85,036

 

 

$

—

 

Investment securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury and federal agencies

 

 

1,947,487

 

 

 

—

 

 

 

1,947,487

 

 

 

—

 

Obligations of states and political subdivisions

 

 

2,589

 

 

 

—

 

 

 

2,589

 

 

 

—

 

Mortgage-backed securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government issued or guaranteed

 

 

8,716,392

 

 

 

—

 

 

 

8,716,392

 

 

 

—

 

Privately issued

 

 

28

 

 

 

—

 

 

 

—

 

 

 

28

 

Other debt securities

 

 

128,832

 

 

 

—

 

 

 

128,832

 

 

 

—

 

Equity securities

 

 

100,956

 

 

 

73,232

 

 

 

27,724

 

 

 

—

 

 

 

 

10,896,284

 

 

 

73,232

 

 

 

10,823,024

 

 

 

28

 

Real estate loans held for sale

 

 

378,047

 

 

 

—

 

 

 

378,047

 

 

 

—

 

Other assets (b)

 

 

12,696

 

 

 

—

 

 

 

3,899

 

 

 

8,797

 

Total assets

 

$

11,419,936

 

 

$

121,105

 

 

$

11,290,006

 

 

$

8,825

 

Trading account liabilities

 

$

137,390

 

 

$

—

 

 

$

137,390

 

 

$

—

 

Other liabilities (b)

 

 

1,796

 

 

 

—

 

 

 

1,302

 

 

 

494

 

Total liabilities

 

$

139,186

 

 

$

—

 

 

$

138,692

 

 

$

494

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trading account assets

 

$

323,867

 

 

$

46,135

 

 

$

277,732

 

 

$

—

 

Investment securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury and federal agencies

 

 

1,902,544

 

 

 

—

 

 

 

1,902,544

 

 

 

—

 

Obligations of states and political subdivisions

 

 

3,641

 

 

 

—

 

 

 

3,641

 

 

 

—

 

Mortgage-backed securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government issued or guaranteed

 

 

10,954,861

 

 

 

—

 

 

 

10,954,861

 

 

 

—

 

Privately issued

 

 

44

 

 

 

—

 

 

 

—

 

 

 

44

 

Other debt securities

 

 

118,516

 

 

 

—

 

 

 

118,516

 

 

 

—

 

Equity securities

 

 

352,466

 

 

 

301,711

 

 

 

50,755

 

 

 

—

 

 

 

 

13,332,072

 

 

 

301,711

 

 

 

13,030,317

 

 

 

44

 

Real estate loans held for sale

 

 

1,056,180

 

 

 

—

 

 

 

1,056,180

 

 

 

—

 

Other assets (b)

 

 

58,351

 

 

 

—

 

 

 

50,291

 

 

 

8,060

 

Total assets

 

$

14,770,470

 

 

$

347,846

 

 

$

14,414,520

 

 

$

8,104

 

Trading account liabilities

 

$

174,376

 

 

$

—

 

 

$

174,376

 

 

$

—

 

Other liabilities (b)

 

 

2,481

 

 

 

—

 

 

 

1,746

 

 

 

735

 

Total liabilities

 

$

176,857

 

 

$

—

 

 

$

176,122

 

 

$

735

 

 

 

(a)

There were no significant transfers between Level 1 and Level 2 of the fair value hierarchy during the years ended December 31, 2017 and 2016.

(b)

Comprised predominantly of interest rate swap agreements used for interest rate risk management (Level 2), commitments to sell real estate loans (Level 2) and commitments to originate real estate loans to be held for sale (Level 3).
Changes in Level 3 Assets and Liabilities Measured at Estimated Fair Value on Recurring Basis

The changes in Level 3 assets and liabilities measured at estimated fair value on a recurring basis during the years ended December 31, 2017, 2016 and 2015 were as follows:

 

 

 

 

 

 

 

Investment

Securities

Available for Sale

 

 

 

 

 

 

 

 

 

 

 

 

 

Privately Issued Mortgage-Backed Securities

 

 

 

Other Assets and Other Liabilities

 

 

 

 

 

 

 

 

(In thousands)

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance — January 1, 2017

 

 

 

 

 

$

44

 

 

 

$

7,325

 

 

Total gains (losses) realized/unrealized:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

 

 

 

 

—

 

 

 

 

77,832

 

(b)

Sales

 

 

 

 

 

 

—

 

 

 

 

—

 

 

Settlements

 

 

 

 

 

 

(16

)

 

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

 

 

 

 

—

 

 

 

 

(76,854

)

(e)

Balance — December 31, 2017

 

 

 

 

 

$

28

 

 

 

 

8,303

 

 

Changes in unrealized gains included in earnings

   related to assets still held at December 31, 2017

 

 

 

 

 

$

—

 

 

 

 

7,978

 

(b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment Securities Available for Sale

 

 

 

 

 

 

 

 

 

Privately Issued Mortgage-Backed Securities

 

 

Collateralized Debt Obligations

 

 

 

Other Assets and Other Liabilities

 

 

 

 

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance — January 1, 2016

 

$

74

 

 

 

47,393

 

 

 

 

9,879

 

 

Total gains (losses) realized/unrealized:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

—

 

 

 

30,041

 

(c)

 

 

110,937

 

(b)

Included in other comprehensive income

 

 

—

 

 

 

(18,268

)

(d)

 

 

—

 

 

Sales

 

 

—

 

 

 

(58,296

)

 

 

 

—

 

 

Settlements

 

 

(30

)

 

 

(870

)

 

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

—

 

 

 

—

 

 

 

 

(113,491

)

(e)

Balance — December 31, 2016

 

$

44

 

 

 

—

 

 

 

 

7,325

 

 

Changes in unrealized gains included in earnings

   related to assets still held at December 31, 2016

 

$

—

 

 

 

—

 

 

 

 

7,256

 

(b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance — January 1, 2015

 

$

103

 

 

 

50,316

 

 

 

 

17,347

 

 

Total gains realized/unrealized:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

—

 

 

 

—

 

 

 

 

87,061

 

(b)

Included in other comprehensive income

 

 

—

 

 

 

3,254

 

(d)

 

 

—

 

 

Settlements

 

 

(29

)

 

 

(6,177

)

 

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

—

 

 

 

—

 

 

 

 

(94,529

)

(e)

Balance — December 31, 2015

 

$

74

 

 

 

47,393

 

 

 

 

9,879

 

 

Changes in unrealized gains included in earnings

   related to assets still held at December 31, 2015

 

$

—

 

 

 

—

 

 

 

 

8,850

 

(b)

 

(a)

The Company’s policy for transfers between fair value levels is to recognize the transfer as of the actual date of the event or change in circumstances that caused the transfer.

(b)

Reported as mortgage banking revenues in the consolidated statement of income and includes the fair value of commitment issuances and expirations.

(c)

Reported as gain on bank investment securities in the consolidated statement of income.

(d)

Reported as net unrealized gains (losses) on investment securities in the consolidated statement of comprehensive income.

(e)

Transfers out of Level 3 consist of interest rate locks transferred to closed loans.
Quantitative Information Related to Significant Unobservable Inputs

The following tables present quantitative information about significant unobservable inputs used in the fair value measurements for Level 3 assets and liabilities at December 31, 2017 and 2016:

 

 

 

Fair Value

 

 

Valuation

Technique

 

Unobservable

Inputs/Assumptions

 

 

Range

(Weighted-

Average)

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring fair value measurements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Privately issued mortgage-backed

   securities

 

$

28

 

 

Two independent pricing quotes

 

 

—

 

 

 

—

 

Net other assets (liabilities) (a)

 

 

8,303

 

 

Discounted cash flow

 

Commitment expirations

 

 

0%-78% (22%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring fair value measurements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Privately issued mortgage-backed

   securities

 

$

44

 

 

Two independent pricing quotes

 

 

—

 

 

 

—

 

Net other assets (liabilities) (a)

 

 

7,325

 

 

Discounted cash flow

 

Commitment expirations

 

 

0%-77% (30%)

 

 

(a)

Other Level 3 assets (liabilities) consist of commitments to originate real estate loans.
Carrying Amounts and Estimated Fair Value for Financial Instrument Assets (Liabilities)

The carrying amounts and estimated fair value for financial instrument assets (liabilities) are presented in the following table:

 

 

 

December 31, 2017

 

 

 

Carrying

Amount

 

 

Estimated

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(In thousands)

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,420,888

 

 

 

1,420,888

 

 

 

1,352,035

 

 

 

68,853

 

 

 

—

 

Interest-bearing deposits at banks

 

 

5,078,903

 

 

 

5,078,903

 

 

 

—

 

 

 

5,078,903

 

 

 

—

 

Trading account assets

 

 

132,909

 

 

 

132,909

 

 

 

47,873

 

 

 

85,036

 

 

 

—

 

Investment securities

 

 

14,664,525

 

 

 

14,653,074

 

 

 

73,232

 

 

 

14,469,127

 

 

 

110,715

 

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans and leases

 

 

21,742,651

 

 

 

21,321,282

 

 

 

—

 

 

 

—

 

 

 

21,321,282

 

Commercial real estate loans

 

 

33,366,373

 

 

 

32,950,724

 

 

 

—

 

 

 

22,130

 

 

 

32,928,594

 

Residential real estate loans

 

 

19,613,344

 

 

 

19,596,826

 

 

 

—

 

 

 

4,440,645

 

 

 

15,156,181

 

Consumer loans

 

 

13,266,615

 

 

 

13,161,517

 

 

 

—

 

 

 

—

 

 

 

13,161,517

 

Allowance for credit losses

 

 

(1,017,198

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Loans and leases, net

 

 

86,971,785

 

 

 

87,030,349

 

 

 

—

 

 

 

4,462,775

 

 

 

82,567,574

 

Accrued interest receivable

 

 

327,170

 

 

 

327,170

 

 

 

—

 

 

 

327,170

 

 

 

—

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

$

(33,975,180

)

 

 

(33,975,180

)

 

 

—

 

 

 

(33,975,180

)

 

 

—

 

Savings and interest-checking deposits

 

 

(51,698,008

)

 

 

(51,698,008

)

 

 

—

 

 

 

(51,698,008

)

 

 

—

 

Time deposits

 

 

(6,580,962

)

 

 

(6,635,048

)

 

 

—

 

 

 

(6,635,048

)

 

 

—

 

Deposits at Cayman Islands office

 

 

(177,996

)

 

 

(177,996

)

 

 

—

 

 

 

(177,996

)

 

 

—

 

Short-term borrowings

 

 

(175,099

)

 

 

(175,099

)

 

 

—

 

 

 

(175,099

)

 

 

—

 

Long-term borrowings

 

 

(8,141,430

)

 

 

(8,193,783

)

 

 

—

 

 

 

(8,193,783

)

 

 

—

 

Accrued interest payable

 

 

(75,641

)

 

 

(75,641

)

 

 

—

 

 

 

(75,641

)

 

 

—

 

Trading account liabilities

 

 

(137,390

)

 

 

(137,390

)

 

 

—

 

 

 

(137,390

)

 

 

—

 

Other financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments to originate real estate

   loans for sale

 

$

8,303

 

 

 

8,303

 

 

 

—

 

 

 

—

 

 

 

8,303

 

Commitments to sell real estate loans

 

 

1,958

 

 

 

1,958

 

 

 

—

 

 

 

1,958

 

 

 

—

 

Other credit-related commitments

 

 

(125,281

)

 

 

(125,281

)

 

 

—

 

 

 

—

 

 

 

(125,281

)

Interest rate swap agreements used for interest

   rate risk management

 

 

639

 

 

 

639

 

 

 

—

 

 

 

639

 

 

 

—

 

 

 

 

December 31, 2016

 

 

 

Carrying

Amount

 

 

Estimated

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(In thousands)

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,320,549

 

 

 

1,320,549

 

 

 

1,249,654

 

 

 

70,895

 

 

—

 

Interest-bearing deposits at banks

 

 

5,000,638

 

 

 

5,000,638

 

 

 

—

 

 

 

5,000,638

 

 

—

 

Trading account assets

 

 

323,867

 

 

 

323,867

 

 

 

46,135

 

 

 

277,732

 

 

—

 

Investment securities

 

 

16,250,468

 

 

 

16,244,412

 

 

 

301,711

 

 

 

15,821,176

 

 

 

121,525

 

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans and leases

 

 

22,610,047

 

 

 

22,239,428

 

 

—

 

 

—

 

 

 

22,239,428

 

Commercial real estate loans

 

 

33,506,394

 

 

 

33,129,428

 

 

—

 

 

 

642,590

 

 

 

32,486,838

 

Residential real estate loans

 

 

22,590,912

 

 

 

22,638,167

 

 

—

 

 

 

4,912,488

 

 

 

17,725,679

 

Consumer loans

 

 

12,146,063

 

 

 

12,061,590

 

 

—

 

 

 

—

 

 

 

12,061,590

 

Allowance for credit losses

 

 

(988,997

)

 

 

—

 

 

—

 

 

 

—

 

 

 

—

 

Loans and leases, net

 

 

89,864,419

 

 

 

90,068,613

 

 

—

 

 

 

5,555,078

 

 

 

84,513,535

 

Accrued interest receivable

 

 

308,805

 

 

 

308,805

 

 

—

 

 

 

308,805

 

 

—

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

$

(32,813,896

)

 

 

(32,813,896

)

 

—

 

 

 

(32,813,896

)

 

—

 

Savings and interest-checking deposits

 

 

(52,346,207

)

 

 

(52,346,207

)

 

—

 

 

 

(52,346,207

)

 

—

 

Time deposits

 

 

(10,131,846

)

 

 

(10,222,585

)

 

—

 

 

 

(10,222,585

)

 

—

 

Deposits at Cayman Islands office

 

 

(201,927

)

 

 

(201,927

)

 

—

 

 

 

(201,927

)

 

—

 

Short-term borrowings

 

 

(163,442

)

 

 

(163,442

)

 

—

 

 

 

(163,442

)

 

—

 

Long-term borrowings

 

 

(9,493,835

)

 

 

(9,473,844

)

 

—

 

 

 

(9,473,844

)

 

—

 

Accrued interest payable

 

 

(75,172

)

 

 

(75,172

)

 

—

 

 

 

(75,172

)

 

—

 

Trading account liabilities

 

 

(174,376

)

 

 

(174,376

)

 

—

 

 

 

(174,376

)

 

—

 

Other financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments to originate real estate

   loans for sale

 

$

7,325

 

 

 

7,325

 

 

—

 

 

 

—

 

 

 

7,325

 

Commitments to sell real estate loans

 

 

36,653

 

 

 

36,653

 

 

—

 

 

 

36,653

 

 

—

 

Other credit-related commitments

 

 

(136,295

)

 

 

(136,295

)

 

—

 

 

 

—

 

 

 

(136,295

)

Interest rate swap agreements used for interest

   rate risk management

 

 

11,892

 

 

 

11,892

 

 

—

 

 

 

11,892

 

 

—