Loans, Allowance for Loan Losses and Credit Quality (Tables)

9 Months Ended

Sep. 30, 2020

Financing Receivable, Allowance for Credit Loss [Line Items]

Tabular disclosure of financing receivables bifurcated by type of impairment evaluation [Table Text Block]

The following table bifurcates the amount of loans and the allowance allocated to each loan category based on the type of impairment analysis as of December 31, 2019:

	December 31, 2019
	Commercial and Industrial		Commercial Real Estate		Commercial Construction		Small Business		Residential Real Estate		Home Equity		Other Consumer		Total
	(Dollars in thousands)
Financing receivables ending balance:
Collectively evaluated for impairment	$	1,370,580	$	3,987,848	$	547,293	$	173,960	$	1,571,848	$	1,127,963	$	29,663	$	8,809,155
Individually evaluated for impairment	24,456		8,337		—		537		11,228		4,948		122		49,628
Purchased credit impaired loans	—		6,174		—		—		7,493		887		302		14,856
Total loans by group	$	1,395,036	$	4,002,359	$	547,293	$	174,497	$	1,590,569	$	1,133,798	$	30,087	$	8,873,639	(1)

(1)The amount of net deferred costs on originated loans included in the ending balance was $7.1 million at December 31, 2019. Net unamortized discounts on acquired loans not deemed to be purchased credit impaired ("PCI") included in the ending balance was $21.6 million at December 31, 2019.

Summary of changes in allowance for loan losses

The following table summarizes the change in allowance for credit losses by loan category, and bifurcates the amount of loans allocated to each loan category for the period indicated:

	Three Months Ended September 30, 2020
	(Dollars in thousands)
	Commercial and Industrial		Commercial Real Estate		Commercial Construction		Small Business		Residential Real Estate		Home  Equity		Other Consumer		Total
Allowance for credit losses
Beginning balance	$	25,662	$	36,956	$	4,501	$	4,561	$	15,046	$	24,860	$	590	$	112,176
Charge-offs	(185)		(3,885)		—		(49)		—		—		(185)		(4,304)
Recoveries	1		9		—		2		1		21		219		253
Provision for credit loss expense	2,741		6,306		709		79		(884)		(1,309)		(142)		7,500
Ending balance (1)	$	28,219	$	39,386	$	5,210	$	4,593	$	14,163	$	23,572	$	482	$	115,625
	Nine Months Ended September 30, 2020
	(Dollars in thousands)
	Commercial and Industrial		Commercial Real Estate		Commercial Construction		Small Business		Residential Real Estate		Home  Equity		Other Consumer		Total
Allowance for credit losses
Beginning balance, pre adoption of Topic 326	$	17,594	$	32,935	$	6,053	$	1,746	$	3,440	$	5,576	$	396	$	67,740
Cumulative effect accounting adjustment (2)	(1,984)		(13,048)		(3,652)		495		9,828		7,012		212		(1,137)
Cumulative effect accounting adjustment (3)	49		337		—		—		423		319		29		1,157
Charge-offs	(185)		(3,885)		—		(194)		—		(142)		(1,342)		(5,748)
Recoveries	47		9		—		8		2		174		873		1,113
Provision for credit loss expense	12,698		23,038		2,809		2,538		470		10,633		314		52,500
Ending balance (1)	$	28,219	$	39,386	$	5,210	$	4,593	$	14,163	$	23,572	$	482	$	115,625

(1)Balances of accrued interest receivable excluded from amortized cost and the calculation of allowance for credit losses amounted to $36.7 million as of September 30, 2020.

(2)Represents adjustment needed to reflect the cumulative day one impact pursuant to the Company's adoption of Accounting Standards Update 2016-13. The adjustment represents a $1.1 million decrease to the allowance attributable to the change in accounting methodology for estimating the allowance for credit losses resulting from the Company's adoption of the standard.

(3)Represents adjustment needed to reflect the day one reclassification of the Company's PCI loan balances to PCD and the associated gross-up, pursuant to the Company's adoption of Accounting Standards Update 2016-13. The adjustment represents a $1.2 million increase to the allowance resulting from the day one reclassification.

The following table summarizes changes in allowance for loan losses by loan category for the periods indicated:

	Three Months Ended September 30, 2019
	(Dollars in thousands)
	Commercial and Industrial		Commercial Real Estate		Commercial Construction		Small Business		Residential Real Estate		Home Equity		Other Consumer		Total
Allowance for loan losses
Beginning balance	$	16,857	$	32,660	$	5,593	$	1,768	$	3,296	$	5,547	$	239	$	65,960
Charge-offs	—		(82)		—		(125)		—		(28)		(472)		(707)
Recoveries	1,003		106		—		61		140		194		185		1,689
Provision (benefit)	(528)		(33)		240		48		(88)		36		325		—
Ending balance	$	17,332	$	32,651	$	5,833	$	1,752	$	3,348	$	5,749	$	277	$	66,942
	Nine Months Ended September 30, 2019
	(Dollars in thousands)
	Commercial and Industrial		Commercial Real Estate		Commercial Construction		Small Business		Residential Real Estate		Home Equity		Other Consumer		Total
Allowance for loan losses
Beginning balance	$	15,760	$	32,370	$	5,158	$	1,756	$	3,219	$	5,608	$	422	$	64,293
Charge-offs	—		(82)		—		(319)		—		(212)		(1,125)		(1,738)
Recoveries	1,127		152		—		108		141		278		581		2,387
Provision (benefit)	445		211		675		207		(12)		75		399		2,000
Ending balance	$	17,332	$	32,651	$	5,833	$	1,752	$	3,348	$	5,749	$	277	$	66,942
Ending balance: collectively evaluated for impairment	$	17,326	$	32,610	$	5,833	$	1,741	$	2,729	$	5,594	$	272	$	66,105
Ending balance: individually evaluated for impairment	$	6	$	41	$	—	$	11	$	619	$	155	$	5	$	837

Internal risk-rating categories for the Company's commercial portfolio

he following table details the amortized cost balances of the Company's loan portfolios, presented by credit quality indicator and origination year as of the date indicated below:

	September 30, 2020
	2020			2019		2018		2017		2016		Prior		Revolving Loans		Revolving converted to Term		Total
	(Dollars in thousands)
Commercial and industrial
Pass	$	1,012,974	(1)	$	153,137	$	107,318	$	34,826	$	23,065	$	22,334	$	601,937	$	2,577	$	1,958,168
Potential weakness	2,560			2,302		7,833		4,573		1,219		318		15,248		50		34,103
Definite weakness - loss unlikely	2,732			1,553		22,748		5,500		2,483		1,419		33,496		—		69,931
Partial loss probable	—			—		—		—		—		143		—		—		143
Definite loss	—			—		—		—		—		—		—		—		—
Total commercial and industrial	$	1,018,266		$	156,992	$	137,899	$	44,899	$	26,767	$	24,214	$	650,681	$	2,627	$	2,062,345
Commercial real estate
Pass	$	753,415		$	859,548	$	512,371	$	587,345	$	399,442	$	751,629	$	39,998	$	16,341	$	3,920,089
Potential weakness	20,639			15,957		20,313		7,941		27,253		47,875		—		—		139,978
Definite weakness - loss unlikely	4,261			2,265		10,092		21,081		2,170		6,605		—		—		46,474
Partial loss probable	—			—		18,923		—		—		—		—		—		18,923
Definite loss	—			—		—		—		—		—		—		—		—
Total commercial real estate	$	778,315		$	877,770	$	561,699	$	616,367	$	428,865	$	806,109	$	39,998	$	16,341	$	4,125,464
Commercial construction
Pass	$	182,291		$	196,420	$	73,298	$	66,406	$	—	$	6,750	$	31,372	$	1,077	$	557,614
Potential weakness	—			9,352		5,037		—		—		—		328		—		14,717
Definite weakness - loss unlikely	—			—		1,003		—		—		—		—		—		1,003
Partial loss probable	—			—		—		—		—		—		—		—		—
Definite loss	—			—		—		—		—		—		—		—		—
Total commercial construction	$	182,291		$	205,772	$	79,338	$	66,406	$	—	$	6,750	$	31,700	$	1,077	$	573,334
Small business
Pass	$	27,457		$	28,766	$	20,806	$	14,627	$	14,528	$	22,644	$	34,569	$	—	$	163,397
Potential weakness	—			10		16		10		755		232		736		—		1,759
Definite weakness - loss unlikely	184			408		78		170		98		723		786		—		2,447
Partial loss probable	—			—		—		—		—		—		29		—		29
Definite loss	—			—		—		—		—		—		—		—		—
Total small business	$	27,641		$	29,184	$	20,900	$	14,807	$	15,381	$	23,599	$	36,120	$	—	$	167,632
Residential real estate
Pass	$	131,691		$	167,901	$	187,194	$	168,048	$	241,638	$	449,219	$	—	$	—	$	1,345,691
Default	728			—		760		235		167		4,724		—		—		6,614
Total residential real estate	$	132,419		$	167,901	$	187,954	$	168,283	$	241,805	$	453,943	$	—	$	—	$	1,352,305
Home equity
Pass	$	60,274		$	66,238	$	59,534	$	59,387	$	44,817	$	122,397	$	681,784	$	4,057	$	1,098,488

Default	—		—		—		—		—		455		2,044		67		2,566
Total home equity	$	60,274	$	66,238	$	59,534	$	59,387	$	44,817	$	122,852	$	683,828	$	4,124	$	1,101,054
Other consumer
Pass	$	679	$	450	$	209	$	739	$	696	$	7,737	$	12,493	$	—	$	23,003
Default	—		—		—		20		—		34		2		—		56
Total other consumer	$	679	$	450	$	209	$	759	$	696	$	7,771	$	12,495	$	—	$	23,059
Total	$	2,199,885	$	1,504,307	$	1,047,533	$	970,908	$	758,331	$	1,445,238	$	1,454,822	$	24,169	$	9,405,193

The following tables detail the amount of outstanding principal balances relative to each of the risk-rating categories for the Company’s loan portfolio as of December 31, 2019:

		December 31, 2019
Category	Risk Rating	Commercial  and Industrial		Commercial Real Estate		Commercial Construction		Small Business		Total
		(Dollars in thousands)
Pass	1 - 6	$	1,274,155	$	3,860,555	$	542,608	$	171,213	$	5,848,531
Potential weakness	7	63,485		97,268		2,247		1,416		164,416
Definite weakness-loss unlikely	8	57,396		44,536		2,438		1,868		106,238
Partial loss probable	9	—		—		—		—		—
Definite loss	10	—		—		—		—		—
Total		$	1,395,036	$	4,002,359	$	547,293	$	174,497	$	6,119,185

Weighted average FICO scores and the weighted average combined LTV ratio

The following table shows the weighted average FICO scores and the weighted average combined LTV ratios at the dates indicated below:

	September 30 2020		December 31 2019
Residential portfolio
FICO score (re-scored)(1)	749		749
LTV (re-valued)(2)	57.7	%	59.0	%
Home equity portfolio
FICO score (re-scored)(1)	770		767
LTV (re-valued)(2)(3)	46.6	%	46.6	%

(1)The average FICO scores at September 30, 2020 are based upon rescores available from August 2020 and origination score data for loans booked in September 2020.  The average FICO scores at December 31, 2019 were based upon rescores available from November 2019 and origination score data for loans booked in December 2019.

(2)The combined LTV ratios for September 30, 2020 are based upon updated automated valuations as of August 2020, when available, and/or the most current valuation data available.  The combined LTV ratios for December 31, 2019 were based upon updated automated valuations as of November 2019, when available, and/or the most current valuation data available as of such date.  The updated automated valuations provide new information on loans that may be available since the previous valuation was obtained.  If no new information is available, the valuation will default to the previously obtained data or most recent appraisal.

(3)For home equity loans and lines in a subordinate lien, the LTV data represents a combined LTV, taking into account the senior lien data for loans and lines.

Summary of nonaccrual loans

The following table shows information regarding nonaccrual loans as of the dates indicated:

	Nonaccrual Balances
	September 30, 2020						December 31, 2019
	With Allowance for Credit Losses		Without Allowance for Credit Losses		Total		Total
	(Dollars in thousands)
Commercial and industrial	$	17,816	$	19,035	$	36,851	$	22,574
Commercial real estate	17,501		20,663		38,164		3,016
Small business	542		—		542		311
Residential real estate	13,379		2,850		16,229		13,360
Home equity	6,052		107		6,159		6,570
Other consumer	79		—		79		61
Total nonaccrual loans (1)	$	55,369	$	42,655	$	98,024	$	45,892

(1)Included in these amounts were $23.8 million and $24.8 million of nonaccruing TDRs at September 30, 2020 and December 31, 2019, re

Foreclosed Residential Real Estate Property [Table Text Block]

The following table shows information regarding foreclosed residential real estate property at the dates indicated:

	September 30, 2020		December 31, 2019
	(Dollars in thousands)
Foreclosed residential real estate property held by the creditor	$	—	$	—
Recorded investment in mortgage loans collateralized by residential real estate property that are in the process of foreclosure	$	2,113	$	3,294

Age analysis of past due financing receivables

The following tables show the age analysis of past due financing receivables as of the dates indicated:

	September 30, 2020
	30-59 days			60-89 days			90 days or more			Total Past Due					Total Financing Receivables		Amortized Cost >90 Days and  Accruing
	Number of Loans	Principal Balance		Number of Loans	Principal Balance		Number of Loans	Principal Balance		Number of Loans	Principal Balance		Current
	(Dollars in thousands)
Loan Portfolio
Commercial and industrial	1	$	52	6	$	3,608	5	$	930	12	$	4,590	$	2,057,755	$	2,062,345	$	—
Commercial real estate	1	99		2	8,269		5	1,355		8	9,723		4,115,741		4,125,464		—
Commercial construction	—	—		—	—		—	—		—	—		573,334		573,334		—
Small business	6	514		4	455		12	124		22	1,093		166,539		167,632		—
Residential real estate	11	1,792		7	1,631		37	5,870		55	9,293		1,343,012		1,352,305		—
Home equity	18	1,581		8	468		36	2,566		62	4,615		1,096,439		1,101,054		—
Other consumer (1)	237	217		3	1		12	57		252	275		22,784		23,059		1
Total	274	$	4,255	30	$	14,432	107	$	10,902	411	$	29,589	$	9,375,604	$	9,405,193	$	1

	December 31, 2019
	30-59 days			60-89 days			90 days or more			Total Past Due					Total Financing Receivables		Recorded Investment >90 Days and  Accruing
	Number of Loans	Principal Balance		Number of Loans	Principal Balance		Number of Loans	Principal Balance		Number of Loans	Principal Balance		Current
	(Dollars in thousands)
Loan Portfolio
Commercial and industrial	1	$	253	2	$	323	5	$	760	8	$	1,336	$	1,393,700	$	1,395,036	$	—
Commercial real estate	7	1,690		1	194		8	2,038		16	3,922		3,998,437		4,002,359		218		(2)
Commercial construction	1	560		—	—		—	—		1	560		546,733		547,293		—
Small business	11	837		3	15		6	115		20	967		173,530		174,497		—
Residential real estate	17	2,237		17	3,055		38	7,020		72	12,312		1,578,257		1,590,569		1,652		(2)
Home equity	23	1,689		8	524		40	3,854		71	6,067		1,127,731		1,133,798		265		(2)
Other consumer (1)	387	245		12	44		16	32		415	321		29,766		30,087		22
Total	447	$	7,511	43	$	4,155	113	$	13,819	603	$	25,485	$	8,848,154	$	8,873,639	$	2,157

(1)Other consumer portfolio is inclusive of deposit account overdrafts recorded as loan balances.

(2)Represents purchased credit impaired ("PCI") loans that were accruing interest due to expectations of future cash collections.

Summary of Troubled Debt Restructuring and other pertinent information

The following table shows the Company’s total TDRs and other pertinent information as of the dates indicated:

		September 30, 2020		December 31, 2019
	(Dollars in thousands)
TDRs on accrual status		$	17,521	$	19,599
TDRs on nonaccrual		23,810		24,766
Total TDRs		$	41,331	$	44,365
Amount of specific reserves associated with TDRs		n/a		$	855
Additional commitments to lend to a borrower who has been a party to a TDR		$	158	$	63

Change in investment recorded subsequent to modifications

The following table shows the troubled debt restructurings which occurred during the periods indicated and the change in the recorded investment subsequent to the modifications occurring:

	Three Months Ended					Nine Months Ended
	September 30, 2020					September 30, 2020
	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(Dollars in thousands)
Troubled debt restructurings
Commercial and industrial	2	$	83	$	83	5	$	391	$	391
Commercial real estate	3	744		744		8	2,518		2,518
Small business	—	—		—		2	112		88
Residential real estate	—	—		—		2	559		642
Total	5	$	827	$	827	17	$	3,580	$	3,639

	Three Months Ended					Nine Months Ended
	September 30, 2019					September 30, 2019
	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(Dollars in thousands)
Troubled debt restructurings
Commercial and industrial	1	$	87	$	87	2	$	184	$	184
Commercial real estate	1	133		133		2	283		283
Small business	1	19		19		2	33		33
Residential real estate	1	163		168		1	163		168
Home equity	1	46		46		2	121		121
Total	5	$	448	$	453	9	$	784	$	789

Post modification balance of Troubled Debt Restructuring

	Three Months Ended					Nine Months Ended
	September 30, 2019					September 30, 2019
	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(Dollars in thousands)
Troubled debt restructurings
Commercial and industrial	1	$	87	$	87	2	$	184	$	184
Commercial real estate	1	133		133		2	283		283
Small business	1	19		19		2	33		33
Residential real estate	1	163		168		1	163		168
Home equity	1	46		46		2	121		121
Total	5	$	448	$	453	9	$	784	$	789

The following table shows the Company’s post-modification balance of TDRs listed by type of modification for the periods indicated:

	Three Months Ended		Nine Months Ended
	September 30		September 30
	2020	2019	2020		2019
	(Dollars in thousands)
Adjusted interest rate	218	—	$	822	$	150
Court ordered concession	—	—	25		75
Extended maturity	609	453	2,792		606
Total	827	453	$	3,639	$	831

Impaired loans by loan portfolio

The table below sets forth information regarding the Company’s impaired loans by loan portfolio at the date indicated:

	December 31, 2019
	Recorded Investment		Unpaid Principal Balance		Related Allowance
	(Dollars in thousands)
With no related allowance recorded
Commercial and industrial	$	23,786	$	34,970	$	—
Commercial real estate	6,213		12,101		—
Small business	469		484		—
Residential real estate	4,976		5,123		—
Home equity	3,764		3,893		—
Other consumer	34		34		—
Subtotal	39,242		56,605		—
With an allowance recorded
Commercial and industrial	$	670	$	670	$	126
Commercial real estate	2,124		2,124		48
Small business	68		105		8
Residential real estate	6,252		7,163		637
Home equity	1,184		1,382		156
Other consumer	88		91		5
Subtotal	10,386		11,535		980
Total	$	49,628	$	68,140	$	980

Interest income recognized on impaired loans

The following table sets forth information regarding interest income recognized on impaired loans, by portfolio, for the periods indicated:

	Three Months Ended				Nine Months Ended
	September 30, 2019				September 30, 2019
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
	(Dollars in thousands)
With no related allowance recorded
Commercial and industrial	$	25,694	$	35	$	27,937	$	108
Commercial real estate	12,987		149		13,261		478
Small business	235		3		266		10
Residential real estate	5,031		57		5,061		175
Home equity	4,417		50		4,479		151
Other consumer	39		1		43		2
Subtotal	48,403		295		51,047		924
With an allowance recorded
Commercial and industrial	$	353	$	4	$	360	$	13
Commercial real estate	1,402		20		1,415		60
Small business	92		—		95		2
Residential real estate	6,047		61		6,115		179
Home equity	959		11		972		33
Other consumer	107		1		116		3
Subtotal	8,960		97		9,073		290
Total	$	57,363	$	392	$	60,120	$	1,214

Certain Loans Acquired In Transfer Accounted For As Debt Securities Acquired During Period

The following table displays certain information pertaining to PCI loans at the date indicated:

	December 31, 2019
	(Dollars in thousands)
Outstanding balance	$	18,358
Carrying amount	$	14,856

Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule

The following table summarizes activity in the accretable yield for the PCI loan portfolio for the periods indicated:

	Three Months Ended September 30		Nine Months Ended September 30
	2019		2019
	(Dollars in thousands)
Beginning balance	$	2,238	$	1,191
Acquisition	—		1,464
Accretion	(412)		(1,215)
Other change in expected cash flows (1)	237		623
Reclassification from nonaccretable difference for loans which have paid off	227		227
Ending balance	$	2,290	$	2,290

(1) Represents changes in cash flows expected to be collected and resulting in increased interest income as a prospective yield adjustment over the remaining life of the loan(s).