Stockholders' Equity

6 Months Ended

Jun. 30, 2019

8. Stockholders’ Equity

Common Shares Outstanding

Common shares outstanding excludes treasury shares totaling 0.8 million at June 30, 2019 and 0.9 million at December 31, 2018, with a first-in-first-out cost basis of $14.2 million and $18.5 million at June 30, 2019 and December 31, 2018, respectively. Shares outstanding also excludes unvested restricted share awards totaling 1.3 million at June 30, 2019 and December 31, 2018.

Stock Buyback Program

On May 24, 2018, the Company’s board of directors approved a stock buyback program that authorized the repurchase of up to 5%, or approximately 4.3 million shares, of its outstanding common stock. The approved program allows the Company to repurchase its common shares either in the open market in compliance with Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended, or in privately negotiated transactions with non-affiliated sellers or as otherwise determined by the Company in one or more transactions, from time to time until December 31, 2019. The Company is not obligated to purchase any shares under this program, and the board of directors may terminate or amend the program at any time prior to the expiration date. As of June 30, 2019, 200,000 shares of the Company’s common stock had been purchased at an average price of $41.30 per share under this program.

Accumulated Other Comprehensive Loss

The components of Accumulated Other Comprehensive Loss and changes in those components are presented in the following table.

	Available for Sale Securities			HTM Securities Transferred from AFS			Employee Benefit Plans			Cash Flow Hedges			Equity Method Investment		Total
(in thousands)
Balance, December 31, 2017	$	(29,512	)	$	(14,585	)	$	(79,078	)	$	(11,227	)	$	—	$	(134,402	)
Other comprehensive income/loss before income taxes:
Net change in unrealized loss		(71,759	)		—			—			(13,894	)		—		(85,653	)
Reclassification of net loss realized and included in earnings		—			—			2,448			1,565			—		4,013
Other Valuation adjustments for employee benefit plan		—			—			(9,039	)		—			—		(9,039	)
Amortization of unrealized net loss on securities transferred to HTM		—			1,680			—			—			—		1,680
Income tax expense (benefit)		(16,284	)		380			(1,494	)		(2,794	)		—		(20,192	)
Balance, June 30, 2018	$	(84,987	)	$	(13,285	)	$	(84,175	)	$	(20,762	)	$	—	$	(203,209	)
Balance, December 31, 2018	$	(50,125	)	$	(12,044	)	$	(110,247	)	$	(8,293	)	$	—	$	(180,709	)
Other comprehensive income (loss) before income taxes:
Net change in unrealized gain or loss		96,514			—			—			29,343			611		126,468
Reclassification of net loss realized and included in earnings		—			—			4,527			3,676			—		8,203
Amortization of unrealized net loss on securities transferred to HTM		—			1,481			—			—			—		1,481
Income tax expense		21,822			335			1,023			7,466			—		30,646
Balance, June 30, 2019	$	24,567		$	(10,898	)	$	(106,743	)	$	17,260		$	611	$	(75,203	)

Accumulated Other Comprehensive Income or Loss (“AOCI”) is reported as a component of stockholders’ equity. AOCI can include, among other items, unrealized holding gains and losses on securities available for sale (“AFS”), including the Company’s share of unrealized gains and losses reported by a partnership accounted for under the equity method, gains and losses associated with pension or other post-retirement benefits that are not recognized immediately as a component of net periodic benefit cost, and gains and losses on derivative instruments that are designated as, and qualify as, cash flow hedges. Net unrealized gains and losses on AFS securities reclassified as securities held to maturity (“HTM”) also continue to be reported as a component of AOCI and will be amortized over the estimated remaining life of the securities as an adjustment to interest income. Subject to certain thresholds, unrealized losses on employee benefit plans will be reclassified into income as pension and post-retirement costs are recognized over the remaining service period of plan participants. Accumulated gains or losses on the cash flow hedge of the variable rate loans described in Note 7 will be reclassified into income over the life of the hedge. Accumulated other comprehensive loss resulting from the terminated interest rate swaps will be amortized over the remaining maturities of the designated instruments. Gains and losses within AOCI are net of deferred income taxes, where applicable.

The following table shows the line items of the consolidated statements of income affected by amounts reclassified from AOCI.

	Six Months
Amount reclassified from AOCI (a)	June 30,						Affected line item on
(in thousands)	2019			2018			the statement of income
Amortization of unrealized net loss on securities transferred to HTM	$	(1,481	)	$	(1,680	)	Interest income
Tax effect		335			380		Income taxes
Net of tax		(1,146	)		(1,300	)	Net income
Amortization of defined benefit pension and post-retirement items		(4,527	)		(2,448	)	Other noninterest expense (b)
Tax effect		1,023			555		Income taxes
Net of tax		(3,504	)		(1,893	)	Net income
Reclassification of unrealized gain (loss) on cash flow hedges		(1,204	)		979		Interest income
Tax effect		272			(222	)	Income taxes
Net of tax		(932	)		757		Net income
Amortization of loss on terminated cash flow hedges		(2,472	)		(2,544	)	Interest income
Tax effect		559			577		Income taxes
Net of tax		(1,913	)		(1,967	)	Net income
Total reclassifications, net of tax	$	(7,495	)	$	(4,403	)	Net income

(a)	Amounts in parentheses indicate reduction in net income.

(b)	These AOCI components are included in the computation of net periodic pension and post-retirement cost that is reported with employee benefits expense (see Note 12 – Retirement Plans for additional details).