Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Total Notional or Contractual Amounts, Fair Value, Collateral and Net Exposure of Derivative Financial Instruments

The total notional or contractual amounts, fair value, collateral and net exposure of our derivative financial instruments at March 31, 2014 and December 31, 2013 were as follows:

		March 31, 2014										December 31, 2013
(Dollars in thousands)	Balance Sheet Location	Notional or Contractual Amount		Fair Value			Collateral (1)		Net Exposure (2)			Notional or Contractual Amount		Fair Value			Collateral (1)		Net Exposure (2)
Derivatives designated as hedging instruments:
Interest rate risks:
Interest rate swaps	Other assets	$	45,964	$	6,025		$	4,810	$	1,215		$	45,964	$	6,492		$	5,080	$	1,412
Derivatives not designated as hedging instruments:
Currency exchange risks:
Foreign exchange forwards	Other assets	7,746		294			—		294			140,760		1,423			—		1,423
Foreign exchange forwards	Other liabilities	236,943		(674		)	—		(674		)	62,649		(634		)	—		(634		)
Net exposure				(380		)	—		(380		)			789			—		789
Other derivative instruments:
Equity warrant assets	Other assets	180,471		91,135			—		91,135			179,934		103,513			—		103,513
Other derivatives:
Client foreign exchange forwards	Other assets	376,095		10,881			—		10,881			424,983		13,673			—		13,673
Client foreign exchange forwards	Other liabilities	346,376		(9,369		)	—		(9,369		)	367,079		(11,549		)	—		(11,549		)
Client foreign currency options	Other assets	85,977		213			—		213			91,854		434			—		434
Client foreign currency options	Other liabilities	85,977		(213		)	—		(213		)	91,854		(434		)	—		(434		)
Loan conversion options	Other assets	3,282		290			—		290			3,455		314			—		314
Client interest rate derivatives	Other assets	263,927		1,471			—		1,471			216,773		1,265			—		1,265
Client interest rate derivatives	Other liabilities	263,927		(1,638		)	—		(1,638		)	216,773		(1,396		)	—		(1,396		)
Net exposure				1,635			—		1,635					2,307			—		2,307
Net				$	98,415		$	4,810	$	93,605				$	113,101		$	5,080	$	108,021

(1) Cash collateral received from our counterparty for our interest rate swap agreement is recorded as a component of “short-term borrowings” on our consolidated balance sheets.

(2) Net exposure for contracts in a gain position reflects the replacement cost in the event of nonperformance by all such counterparties. The credit ratings of our institutional counterparties as of March 31, 2014 remain at investment grade or higher and there were no material changes in their credit ratings during the three months ended March 31, 2014.

Summary of Derivative Activity and Related Impact on Consolidated Statements of Income

A summary of our derivative activity and the related impact on our consolidated statements of income for the three months ended March 31, 2014 and 2013 is as follows:

		Three months ended March 31,
(Dollars in thousands)	Statement of income location	2014			2013
Derivatives designated as hedging instruments:
Interest rate risks:
Net cash benefit associated with interest rate swaps	Interest expense—borrowings	$	639		$	634
Changes in fair value of interest rate swaps	Net gains on derivative instruments	(12		)	60
Net gains associated with interest rate risk derivatives		$	627		$	694
Derivatives not designated as hedging instruments:
Currency exchange risks:
Gains (losses) on revaluations of foreign currency instruments	Other noninterest income	$	978		$	(7,064	)
(Losses) gains on internal foreign exchange forward contracts, net	Net gains on derivative instruments	(1,029		)	6,200
Net (losses) gains associated with currency risk		$	(51	)	$	(864	)
Other derivative instruments:
Net gains on equity warrant assets	Net gains on derivative instruments	$	25,373		$	3,505
Gains on client foreign exchange forward contracts, net	Net gains on derivative instruments	$	302		$	49
Net (losses) gains on other derivatives (1)	Net gains on derivative instruments	$	(467	)	$	478

(1) Primarily represents the change in fair value of loan conversion options.

Offsetting Assets

The following table summarizes our assets subject to enforceable master netting arrangements as of March 31, 2014 and December 31, 2013:

								Gross Amounts Not Offset in the Statement of Financial Position But Subject to Master Netting Arrangements
(Dollars in thousands)	Gross Amounts of Recognized Assets		Gross Amounts offset in the Statement of Financial Position			Net Amounts of Assets Presented in the Statement of Financial Position		Financial Instruments			Cash Collateral Received			Net Amount
March 31, 2014
Derivative Assets:
Interest rate swaps	$	6,025	$	—		$	6,025	$	(1,215	)	$	(4,810	)	$	—
Foreign exchange forwards	11,175		—			11,175		(4,879		)	—			6,296
Foreign currency options	233		(20		)	213		(124		)	—			89
Client interest rate derivatives	1,471		—			1,471		(193		)	—			1,278
Total derivative assets:	18,904		(20		)	18,884		(6,411		)	(4,810		)	7,663
Reverse repurchase, securities borrowing, and similar arrangements	117,036		—			117,036		(117,036		)	—			—
Total	$	135,940	$	(20	)	$	135,920	$	(123,447	)	$	(4,810	)	$	7,663
December 31, 2013
Derivative Assets:
Interest rate swaps	$	6,492	$	—		$	6,492	$	(1,412	)	$	(5,080	)	$	—
Foreign exchange forwards	15,096		—			15,096		(6,735		)	—			8,361
Foreign currency options	504		(70		)	434		(155		)	—			279
Client interest rate derivatives	1,265		—			1,265		(256		)	—			1,009
Total derivative assets:	23,357		(70		)	23,287		(8,558		)	(5,080		)	9,649
Reverse repurchase, securities borrowing, and similar arrangements	172,989		—			172,989		(172,989		)	—			—
Total	$	196,346	$	(70	)	$	196,276	$	(181,547	)	$	(5,080	)	$	9,649

Offsetting Liabilities

The following table summarizes our liabilities subject to enforceable master netting arrangements as of March 31, 2014 and December 31, 2013:

								Gross Amounts Not Offset in the Statement of Financial Position But Subject to Master Netting Arrangements
(Dollars in thousands)	Gross Amounts of Recognized Liabilities		Gross Amounts offset in the Statement of Financial Position			Net Amounts of Liabilities Presented in the Statement of Financial Position		Financial Instruments			Cash Collateral Pledged		Net Amount
March 31, 2014
Derivative Liabilities:
Foreign exchange forwards	$	10,043	$	—		$	10,043	$	(5,880	)	$	—	$	4,163
Foreign currency options	233		(20		)	213		(89		)	—		124
Client interest rate derivatives	1,638		—			1,638		(1,445		)	—		193
Total derivative liabilities:	11,914		(20		)	11,894		(7,414		)	—		4,480
Repurchase, securities lending, and similar arrangements	—		—			—		—			—		—
Total	$	11,914	$	(20	)	$	11,894	$	(7,414	)	$	—	$	4,480
December 31, 2013
Derivative Liabilities:
Foreign exchange forwards	$	12,183	$	—		$	12,183	$	(8,282	)	$	—	$	3,901
Foreign currency options	504		(70		)	434		(279		)	—		155
Client interest rate derivatives	1,396		—			1,396		(1,087		)	—		309
Total derivative liabilities:	14,083		(70		)	14,013		(9,648		)	—		4,365
Repurchase, securities lending, and similar arrangements	—		—			—		—			—		—
Total	$	14,083	$	(70	)	$	14,013	$	(9,648	)	$	—	$	4,365