CORRESP 1 filename1.htm Document


433 Main Street
Green Bay, Wisconsin 54301
920-491-7007 PHONE
seccorrespondencelett_image1.jpg

September 6, 2017

Mr. David Irving
United States Securities and Exchange Commission
Washington, D.C. 20549

Re: Associated Banc-Corp
Form 10-K for the Fiscal Year Ended December 31, 2016
Filed February 6, 2017
File No. 001-31343

Dear Mr. Irving:

Associated Banc-Corp (the “Corporation” or “Associated”) respectfully submits the following information to provide additional clarity to the changes included in the original response letter filed with the Securities and Exchange Commission (the “SEC” or “Commission”) on July 25, 2017 concerning the Corporation’s annual report on Form 10-K for the fiscal year ended December 31, 2016 (the “2016 Form 10-K”). For reference purposes, the text of the Comment Letter has been reproduced below in bold followed by Associated’s clarification to the original response. Proposed disclosures for future filings are included in the responses.

Form 10-K for the Fiscal Year Ended December 31, 2016

Item 8: Financial Statements and Supplementary Data, page 71














Note 4 (Indicated as Note 5 of the original SEC comment letter), Loans, page 97

1.
We note on page 97 that you present impaired loans with and without a related allowance of $221.0 million and $134.1 million, respectively, and a related allowance of $46.5 million. We also note on page 101, that you present loans individually evaluated for impairment and the related allowance of $214.4 million and $24.1 million, respectively. Please explain this difference in your response, as well as any differences in the impaired loan disclosures in subsequent 10-Q’s, and revise future filings as necessary.

Clarification to the Original Response to Item #1:

The Corporation acknowledges the tables included in the original response letter over-disclosed the loans individually evaluated for impairment in accordance with ASC Topic 310 and the loans collectively evaluated for impairment in accordance with ASC Topic 450. In accordance with ASC 310-10-35-13a, the Corporation evaluates smaller-balance homogeneous impaired loans collectively for impairment. In future filings, the Corporation will revise the Allowance for Loan Losses and Impaired Loans tables to clearly reflect this distinction. Presented below are the revised Allowance for Loan Losses and Impaired Loans Tables the Corporation proposes to include in future filings utilizing financial information as of December 31, 2016.




























Allowance for Loan Losses Table, Page 101
A summary of the changes in the allowance for loan losses by portfolio segment for the year ended December 31, 2016, was as follows.
$ in Thousands
Commercial
and
industrial
 
Commercial
real estate
— owner
occupied
 
Commercial
real
estate —
investor
 
Real estate
construction
 
Residential
mortgage
 
Home
equity
 
Other consumer
 
Total
December 31, 2015
$
129,959

 
$
18,680

 
$
43,018

 
$
25,266

 
$
28,261

 
$
23,555

 
$
5,525

 
$
274,264

Charge offs
(71,016
)
 
(512
)
 
(1,504
)
 
(558
)
 
(4,332
)
 
(4,686
)
 
(3,831
)
 
(86,439
)
Recoveries
14,543

 
74

 
1,624

 
203

 
755

 
3,491

 
820

 
21,510

Net charge offs
(56,473
)
 
(438
)
 
120

 
(355
)
 
(3,577
)
 
(1,195
)
 
(3,011
)
 
(64,929
)
Provision for loan losses
66,640

 
(4,208
)
 
2,147

 
2,021

 
2,362

 
(1,996
)
 
2,034

 
69,000

December 31, 2016
$
140,126

 
$
14,034

 
$
45,285

 
$
26,932

 
$
27,046

 
$
20,364

 
$
4,548

 
$
278,335

Allowance for loan losses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
21,047

 
$
23

 
$
3,410

 
$
84

 
$
6,438

 
$
3,943

 
$
109

 
$
35,054

Collectively evaluated for impairment
119,079

 
14,011

 
41,875

 
26,848

 
20,608

 
16,421

 
4,439

 
243,281

Total allowance for loan losses
$
140,126

 
$
14,034

 
$
45,285

 
$
26,932

 
$
27,046

 
$
20,364

 
$
4,548

 
$
278,335

Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
213,271

 
$
13,983

 
$
32,908

 
$
509

 
$
43,876

 
$
11,176

 
$
1,012

 
$
316,735

Collectively evaluated for impairment
6,275,743

 
883,741

 
3,541,824

 
1,431,988

 
6,288,451

 
923,267

 
392,967

 
19,737,981

Total loans
$
6,489,014

 
$
897,724

 
$
3,574,732

 
$
1,432,497

 
$
6,332,327

 
$
934,443

 
$
393,979

 
$
20,054,716






















Impaired Loans Table, Page 97
The following table presents impaired loans individually evaluated under ASC Topic 310 at December 31, 2016.
 
Recorded
Investment
 
Unpaid
Principal
Balance
 
Related
Allowance
 
Average
Recorded
Investment
 
Interest
Income
Recognized
 
($ in Thousands)
Loans with a related allowance
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
99,786

 
$
105,175

 
$
21,047

 
$
104,808

 
$
2,345

Commercial real estate — owner occupied
5,544

 
5,568

 
23

 
5,840

 
263

Commercial and business lending
105,330

 
110,743

 
21,070

 
110,648

 
2,608

Commercial real estate — investor
26,764

 
27,031

 
3,410

 
30,665

 
2,120

Real estate construction
509

 
648

 
84

 
529

 
31

Commercial real estate lending
27,273

 
27,679

 
3,494

 
31,194

 
2,151

Total commercial
132,603

 
138,422

 
24,564

 
141,842

 
4,759

Residential mortgage
37,902

 
39,979

 
6,438

 
38,608

 
1,551

Home equity
11,070

 
11,909

 
3,943

 
11,420

 
627

Other consumer
1,012

 
1,023

 
109

 
1,021

 
2

Total consumer
49,984

 
52,911

 
10,490

 
51,049

 
2,180

Total loans
$
182,587

 
$
191,333

 
$
35,054

 
$
192,891

 
$
6,939

Loans with no related allowance
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
113,485

 
$
134,863

 
$
—

 
$
117,980

 
$
1,519

Commercial real estate — owner occupied
8,439

 
9,266

 
—

 
8,759

 
138

Commercial and business lending
121,924

 
144,129

 
—

 
126,739

 
1,657

Commercial real estate — investor
6,144

 
6,478

 
—

 
7,092

 
—

Real estate construction
—

 
—

 
—

 
—

 
—

Commercial real estate lending
6,144

 
6,478

 
—

 
7,092

 
—

Total commercial
128,068

 
150,607

 
—

 
133,831

 
1,657

Residential mortgage
5,974

 
6,998

 
—

 
6,610

 
184

Home equity
106

 
107

 
—

 
107

 
4

Other consumer
—

 
—

 
—

 
—

 
—

Total consumer
6,080

 
7,105

 
—

 
6,717

 
188

Total loans
$
134,148

 
$
157,712

 
$
—

 
$
140,548

 
$
1,845

Total
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
213,271

 
$
240,038

 
$
21,047

 
$
222,788

 
$
3,864

Commercial real estate — owner occupied
13,983

 
14,834

 
23

 
14,599

 
401

Commercial and business lending
227,254

 
254,872

 
21,070

 
237,387

 
4,265

Commercial real estate — investor
32,908

 
33,509

 
3,410

 
37,757

 
2,120

Real estate construction
509

 
648

 
84

 
529

 
31

Commercial real estate lending
33,417

 
34,157

 
3,494

 
38,286

 
2,151

Total commercial
260,671

 
289,029

 
24,564

 
275,673

 
6,416

Residential mortgage
43,876

 
46,977

 
6,438

 
45,218

 
1,735

Home equity
11,176

 
12,016

 
3,943

 
11,527

 
631

Other consumer
1,012

 
1,023

 
109

 
1,021

 
2

Total consumer
56,064

 
60,016

 
10,490

 
57,766

 
2,368

Total loans
$
316,735

 
$
349,045

 
$
35,054

 
$
333,439

 
$
8,784





Note 18, Fair Value Measurements, page 127

2.
You noted provision for credit losses of $75.2 million from non-recurring changes in the fair value of impaired loans of $79.3 million in the table on page 131 disclosing details concerning assets and liabilities measured at fair value on a nonrecurring basis. Please address the following:

•
Revise future filings to enhance your description of the inputs used in the fair value measurement, including quantitative information about the significant unobservable inputs. Refer to ASC 820-10-50-2.bbb; and
•
Explain how the provision for credit losses of $75.2 million reconciles with the total provision for credit losses of $70.0 million included in the Consolidated Statements of Income.

Clarification to the Original Response to Item #2:

The provision for credit losses figure of $75.2 million on impaired loans included in the 2016 Form 10-K and the original response letter primarily relate to nonaccrual oil and gas loan relationships, as reflected in Table 8 on page 44 of the 2016 Form 10-K. In future filings, the Corporation will expand the Fair Value Measurements Note to include additional information regarding the impaired loans included in the fair value disclosures.






On behalf of Associated, and as requested in your letter, the Corporation acknowledges that:

•
Associated is responsible for the adequacy and accuracy of the disclosure in its filings;
•
Staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and
•
Associated may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

We believe this letter is responsive to your comments. Please feel free to contact me at 920-491-7007 if you have any questions or need further information.

Sincerely,

/s/ Christopher J. Del Moral-Niles

Christopher J. Del Moral-Niles
Chief Financial Officer
Associated Banc-Corp

/s/ Tammy C. Stadler

Tammy C. Stadler
Principal Accounting Officer
Associated Banc-Corp