Stockholders' Equity

9 Months Ended

Sep. 30, 2019

8. Stockholders’ Equity

Common Shares Outstanding

Common shares outstanding excludes treasury shares totaling 0.8 million at September 30, 2019 and 0.9 million at December 31, 2018, with a first-in-first-out cost basis of $14.9 million and $18.5 million at September 30, 2019 and December 31, 2018, respectively. Shares outstanding also excludes unvested restricted share awards totaling 1.3 million at September 30, 2019 and December 31, 2018.

Shares Issued as Consideration in Business Combination

On September 20, 2019, the Company issued approximately 5.0 million shares of common stock at $38.42 as consideration in its acquisition of MidSouth. Refer to Note 2 – Business Combinations for further information.

Stock Buyback Program

On May 24, 2018, the Company’s board of directors approved a stock buyback program whereby the Company was authorized to repurchase up to 5%, or 4.3 million shares, of its 85.3 million shares common stock then outstanding. The program was set to expire on December 31, 2019. Under this program, 200,000 shares of the Company’s common stock were repurchased at an average price of $41.30 per share.

On September 23, 2019, the Company’s board of directors approved a new amended stock buyback program that authorizes the Company to repurchase up to 5.5 million shares of its common stock through the expiration date of December 31, 2020. The program, as amended, allows the Company to repurchase its common shares in the open market, by block purchase, through accelerated share repurchase programs, in privately negotiated transactions, or as otherwise determined by the Company in one or more transactions. 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. Refer to Note 17 – Subsequent Event for information about the accelerated share repurchase agreement the Company entered into subsequent to the balance sheet date.

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		(92,477	)		—			—			(18,418	)		—			(110,895	)
Reclassification of net loss realized and included in earnings		—			—			3,719			2,841			—			6,560
Other Valuation adjustments for employee benefit plan		—			—			(9,039	)		—			—			(9,039	)
Amortization of unrealized net loss on securities transferred to HTM		—			2,427			—			—			—			2,427
Income tax expense (benefit)		(20,985	)		550			(1,205	)		(3,530	)		—			(25,170	)
Balance, September 30, 2018	$	(101,004	)	$	(12,708	)	$	(83,193	)	$	(23,274	)	$	—		$	(220,179	)
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		125,589			—			—			35,472			(434	)		160,627
Reclassification of net loss realized and included in earnings		—			—			6,851			4,632			—			11,483
Valuation adjustment employee benefit plan		—			—			(7,015	)		—			—			(7,015	)
Amortization of unrealized net loss on securities transferred to HTM		—			2,435			—			—			—			2,435
Income tax expense (benefit)		28,395			551			(37	)		9,068			—			37,977
Balance, September 30, 2019	$	47,069		$	(10,160	)	$	(110,374	)	$	22,743		$	(434	)	$	(51,156	)

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.

	Nine Months
Amount reclassified from AOCI (a)	September 30,						Affected line item on
(in thousands)	2019			2018			the statement of income
Amortization of unrealized net loss on securities transferred to HTM	$	(2,435	)	$	(2,427	)	Interest income
Tax effect		551			550		Income taxes
Net of tax		(1,884	)		(1,877	)	Net income
Amortization of defined benefit pension and post-retirement items		(6,851	)		(3,719	)	Other noninterest expense (b)
Tax effect		1,546			842		Income taxes
Net of tax		(5,305	)		(2,877	)	Net income
Reclassification of unrealized gain (loss) on cash flow hedges		(1,200	)		1,264		Interest income
Tax effect		271			(286	)	Income taxes
Net of tax		(929	)		978		Net income
Amortization of loss on terminated cash flow hedges		(3,432	)		(4,105	)	Interest income
Tax effect		776			930		Income taxes
Net of tax		(2,656	)		(3,175	)	Net income
Total reclassifications, net of tax	$	(10,774	)	$	(6,951	)	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).