þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||
For the quarterly period ended March 31, 2018 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||
For the transition period from to |
Wisconsin | 39-1098068 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
433 Main Street Green Bay, Wisconsin | 54301 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer þ | Accelerated filer ¨ |
Non-accelerated filer ¨ | Smaller reporting company ¨ |
(Do not check if a smaller reporting company) | |
Emerging growth company ¨ |
Page | ||
PART I - FINANCIAL INFORMATION | |
ITEM 1. | Financial Statements: |
March 31, 2018 | December 31, 2017 | ||||||
(Unaudited) | (Audited) | ||||||
(In Thousands, except share and per share data) | |||||||
Assets | |||||||
Cash and due from banks | $ | 328,260 | $ | 483,666 | |||
Interest-bearing deposits in other financial institutions | 94,918 | 199,702 | |||||
Federal funds sold and securities purchased under agreements to resell | 10,000 | 32,650 | |||||
Investment securities held to maturity, at amortized cost | 2,443,203 | 2,282,853 | |||||
Investment securities available for sale, at fair value | 4,485,875 | 4,043,446 | |||||
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost | 233,216 | 165,331 | |||||
Residential loans held for sale | 103,953 | 85,544 | |||||
Commercial loans held for sale | 6,091 | — | |||||
Loans | 22,810,491 | 20,784,991 | |||||
Allowance for loan losses | (257,058 | ) | (265,880 | ) | |||
Loans, net | 22,553,433 | 20,519,111 | |||||
Bank and corporate owned life insurance | 657,841 | 591,057 | |||||
Tax credit and other investments | 142,368 | 147,099 | |||||
Trading assets | 102,890 | 69,675 | |||||
Premises and equipment, net | 381,327 | 330,963 | |||||
Goodwill | 1,153,156 | 976,239 | |||||
Mortgage servicing rights, net | 66,407 | 58,384 | |||||
Other intangible assets, net | 79,714 | 15,580 | |||||
Other assets | 523,855 | 482,294 | |||||
Total assets | $ | 33,366,505 | $ | 30,483,594 | |||
Liabilities and Stockholders' Equity | |||||||
Noninterest-bearing demand deposits | $ | 5,458,473 | $ | 5,478,416 | |||
Interest-bearing deposits | 18,367,129 | 17,307,546 | |||||
Total deposits | 23,825,602 | 22,785,962 | |||||
Federal funds purchased and securities sold under agreements to repurchase | 283,954 | 324,815 | |||||
Other short-term funding | 1,862,420 | 351,467 | |||||
Long-term funding | 3,233,338 | 3,397,450 | |||||
Trading liabilities | 100,247 | 67,660 | |||||
Accrued expenses and other liabilities | 348,246 | 318,797 | |||||
Total liabilities | 29,653,806 | 27,246,151 | |||||
Stockholders’ Equity | |||||||
Preferred equity | 159,853 | 159,929 | |||||
Common equity | |||||||
Common stock | 1,741 | 1,618 | |||||
Surplus | 1,823,800 | 1,454,188 | |||||
Retained earnings | 1,859,068 | 1,819,230 | |||||
Accumulated other comprehensive income (loss) | (107,673 | ) | (62,758 | ) | |||
Treasury stock, at cost | (24,089 | ) | (134,764 | ) | |||
Total common equity | 3,552,847 | 3,077,514 | |||||
Total stockholders’ equity | 3,712,699 | 3,237,443 | |||||
Total liabilities and stockholders’ equity | $ | 33,366,505 | $ | 30,483,594 | |||
Preferred shares issued | 165,000 | 165,000 | |||||
Preferred shares authorized (par value $1.00 per share) | 750,000 | 750,000 | |||||
Common shares issued | 174,107,786 | 161,751,975 | |||||
Common shares authorized (par value $0.01 per share) | 250,000,000 | 250,000,000 | |||||
Treasury shares of common stock | 1,925,673 | 8,908,448 |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
(In Thousands, except per share data) | |||||||
Interest Income | |||||||
Interest and fees on loans | $ | 220,034 | $ | 173,649 | |||
Interest and dividends on investment securities: | |||||||
Taxable | 30,104 | 23,475 | |||||
Tax-exempt | 9,217 | 8,129 | |||||
Other interest | 2,177 | 1,536 | |||||
Total interest income | 261,532 | 206,789 | |||||
Interest Expense | |||||||
Interest on deposits | 33,412 | 16,924 | |||||
Interest on Federal funds purchased and securities sold under agreements to repurchase | 522 | 515 | |||||
Interest on other short-term funding | 3,005 | 1,080 | |||||
Interest on long-term funding | 14,722 | 7,996 | |||||
Total interest expense | 51,661 | 26,515 | |||||
Net Interest Income | 209,871 | 180,274 | |||||
Provision for credit losses | — | 9,000 | |||||
Net interest income after provision for credit losses | 209,871 | 171,274 | |||||
Noninterest Income | |||||||
Insurance commissions and fees | 22,648 | 21,620 | |||||
Service charges on deposit account fees | 16,420 | 16,356 | |||||
Card-based and loan fees | 13,422 | 12,465 | |||||
Trust and asset management fees | 13,369 | 11,935 | |||||
Brokerage commission and fees | 7,273 | 4,333 | |||||
Mortgage banking, net | 6,370 | 4,579 | |||||
Capital markets, net | 5,306 | 3,883 | |||||
Bank and corporate owned life insurance | 3,187 | 2,615 | |||||
Asset gains (losses), net | (107 | ) | (234 | ) | |||
Other | 2,492 | 2,279 | |||||
Total noninterest income | 90,380 | 79,831 | |||||
Noninterest Expense | |||||||
Personnel (1) | 117,685 | 106,782 | |||||
Occupancy | 15,357 | 15,219 | |||||
Technology | 17,715 | 14,420 | |||||
Equipment | 5,556 | 5,485 | |||||
Business development and advertising | 6,693 | 5,835 | |||||
Legal and professional | 5,413 | 4,166 | |||||
Card issuance and loan costs | 3,304 | 2,620 | |||||
Foreclosure / OREO expense, net | 723 | 1,505 | |||||
FDIC assessment | 8,250 | 8,000 | |||||
Other intangible amortization | 1,525 | 513 | |||||
Acquisition related costs(2) | 20,605 | — | |||||
Other(1) | 10,140 | 9,146 | |||||
Total noninterest expense | 212,965 | 173,691 | |||||
Income before income taxes | 87,285 | 77,414 | |||||
Income tax expense | 17,829 | 21,144 | |||||
Net Income | 69,456 | 56,270 | |||||
Preferred stock dividends | 2,339 | 2,330 | |||||
Net income available to common equity | $ | 67,117 | $ | 53,940 | |||
Earnings per common share: | |||||||
Basic | $ | 0.41 | $ | 0.36 | |||
Diluted | $ | 0.40 | $ | 0.35 | |||
Average common shares outstanding: | |||||||
Basic | 163,520 | 150,815 | |||||
Diluted | 166,432 | 153,869 |
(1) | During the first quarter of 2018, the Corporation adopted a new accounting standard related to the presentation of net periodic pension cost and net periodic postretirement benefit cost which required the disaggregation of the service cost component from the other components of net benefit cost and net periodic postretirement benefit cost. Under this new accounting standard, the other components of net benefit cost and net periodic postretirement benefit cost were reclassified from personnel expense to other noninterest expense. All prior periods have been adjusted to reflect this change in presentation. |
(2) | Includes Bank Mutual acquisition-related costs only. |
Three Months Ended March 31, | ||||||
2018 | 2017 | |||||
($ in Thousands) | ||||||
Net income | $ | 69,456 | $ | 56,270 | ||
Other comprehensive income, net of tax | ||||||
Investment securities available for sale | ||||||
Net unrealized gains (losses) | (41,834 | ) | 3,152 | |||
Net unrealized gain (loss) on available for sale securities transferred to held to maturity securities | — | (5,264 | ) | |||
Amortization of net unrealized gain (loss) on available for sale securities transferred to held to maturity securities | (297 | ) | (1,027 | ) | ||
Reclassification from OCI due to change in accounting principle | (84 | ) | — | |||
Reclassification of certain tax effects from OCI | (8,419 | ) | — | |||
Income tax (expense) benefit | 10,635 | 1,195 | ||||
Other comprehensive income (loss) on investment securities available for sale | (40,000 | ) | (1,944 | ) | ||
Defined benefit pension and postretirement obligations | ||||||
Amortization of prior service cost | (38 | ) | (38 | ) | ||
Amortization of actuarial loss (gains) | 465 | 488 | ||||
Reclassification of certain tax effects from OCI | (5,235 | ) | — | |||
Income tax (expense) benefit | (107 | ) | (171 | ) | ||
Other comprehensive income (loss) on pension and postretirement obligations | (4,915 | ) | 279 | |||
Total other comprehensive income (loss) | (44,915 | ) | (1,665 | ) | ||
Comprehensive income | $ | 24,541 | $ | 54,605 |
Preferred Equity | Common Stock | Surplus | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total | |||||||||||||||
(In Thousands, except per share data) | |||||||||||||||||||||
Balance, December 31, 2016 | $ | 159,929 | $ | 1,630 | $ | 1,459,498 | $ | 1,695,764 | $ | (54,679 | ) | $ | (170,830 | ) | $ | 3,091,312 | |||||
Comprehensive income | |||||||||||||||||||||
Net income | — | — | — | 56,270 | — | — | 56,270 | ||||||||||||||
Other comprehensive income | — | — | — | — | (1,665 | ) | — | (1,665 | ) | ||||||||||||
Comprehensive income | 54,605 | ||||||||||||||||||||
Common stock issued | |||||||||||||||||||||
Stock-based compensation plans, net | — | — | 868 | (21,822 | ) | — | 38,894 | 17,940 | |||||||||||||
Purchase of treasury stock | — | — | — | — | — | (7,743 | ) | (7,743 | ) | ||||||||||||
Cash dividends | |||||||||||||||||||||
Common stock, $0.12 per share | — | — | — | (18,368 | ) | — | — | (18,368 | ) | ||||||||||||
Preferred stock | — | — | — | (2,330 | ) | — | — | (2,330 | ) | ||||||||||||
Stock-based compensation expense, net | — | — | 8,344 | — | — | — | 8,344 | ||||||||||||||
Other | — | — | 1,034 | — | — | — | 1,034 | ||||||||||||||
Balance, March 31, 2017 | $ | 159,929 | $ | 1,630 | $ | 1,469,744 | $ | 1,709,514 | $ | (56,344 | ) | $ | (139,679 | ) | $ | 3,144,794 | |||||
Balance, December 31, 2017 | $ | 159,929 | $ | 1,618 | $ | 1,454,188 | $ | 1,819,230 | $ | (62,758 | ) | $ | (134,764 | ) | $ | 3,237,443 | |||||
Comprehensive income | |||||||||||||||||||||
Net income | — | — | — | 69,456 | — | — | 69,456 | ||||||||||||||
Other comprehensive income | — | — | — | — | (31,177 | ) | — | (31,177 | ) | ||||||||||||
Adoption of new accounting standards | — | — | — | — | (13,738 | ) | — | (13,738 | ) | ||||||||||||
Comprehensive income | 24,541 | ||||||||||||||||||||
Common stock issued | |||||||||||||||||||||
Stock-based compensation plans, net | — | — | 2,148 | (16,076 | ) | — | 24,619 | 10,691 | |||||||||||||
Acquisition of Bank Mutual | — | 134 | 390,258 | — | — | 91,296 | 481,688 | ||||||||||||||
Purchase of common stock returned to authorized but unissued | (11 | ) | (26,469 | ) | — | — | — | (26,480 | ) | ||||||||||||
Purchase of treasury stock | — | — | — | — | — | (5,240 | ) | (5,240 | ) | ||||||||||||
Cash dividends | |||||||||||||||||||||
Common stock, $0.15 per share | — | — | — | (25,710 | ) | — | — | (25,710 | ) | ||||||||||||
Preferred stock | — | — | — | (2,339 | ) | — | — | (2,339 | ) | ||||||||||||
Redemption of preferred stock | (76 | ) | — | — | (2 | ) | — | — | (78 | ) | |||||||||||
Stock-based compensation expense, net | — | — | 3,675 | — | — | — | 3,675 | ||||||||||||||
Tax Act reclassification | — | — | — | 13,654 | — | 13,654 | |||||||||||||||
Change in accounting principle | — | — | — | 84 | — | 84 | |||||||||||||||
Other | — | — | — | 771 | — | — | 771 | ||||||||||||||
Balance, March 31, 2018 | $ | 159,853 | $ | 1,741 | $ | 1,823,800 | $ | 1,859,068 | $ | (107,673 | ) | $ | (24,089 | ) | $ | 3,712,699 |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
($ in Thousands) | |||||||
Cash Flow From Operating Activities | |||||||
Net income | $ | 69,456 | $ | 56,270 | |||
Adjustments to reconcile net income to net cash provided by operating activities | |||||||
Provision for credit losses | — | 9,000 | |||||
Depreciation and amortization | 12,208 | 11,505 | |||||
Addition to (recovery of) valuation allowance on mortgage servicing rights, net | (474 | ) | 217 | ||||
Amortization of mortgage servicing rights | 2,324 | 2,477 | |||||
Amortization of other intangible assets | 1,525 | 513 | |||||
Amortization and accretion on earning assets, funding, and other, net | 2,188 | 8,215 | |||||
Net amortization of tax credit investments | 4,881 | 1,713 | |||||
Asset (gains) losses, net | 107 | 234 | |||||
(Gain) loss on mortgage banking activities, net | 624 | 5,171 | |||||
Mortgage loans originated and acquired for sale | (197,603 | ) | (101,280 | ) | |||
Proceeds from sales of mortgage loans held for sale | 187,624 | 196,578 | |||||
(Increase) decrease in interest receivable | (12,859 | ) | (761 | ) | |||
Increase (decrease) in interest payable | 1,206 | (185 | ) | ||||
Net change in other assets and other liabilities | (28,114 | ) | (27,968 | ) | |||
Net cash provided by operating activities | 43,093 | 161,699 | |||||
Cash Flow From Investing Activities | |||||||
Net increase in loans | (160,921 | ) | (113,051 | ) | |||
Purchases of | |||||||
Available for sale securities | (646,444 | ) | (163,442 | ) | |||
Held to maturity securities | (208,517 | ) | (2,655 | ) | |||
Federal Home Loan Bank and Federal Reserve Bank stocks | (144,515 | ) | (58,362 | ) | |||
Premises, equipment, and software, net of disposals | (9,892 | ) | (13,586 | ) | |||
Proceeds from | |||||||
Sales of available for sale securities | 452,866 | — | |||||
Sale of Federal Home Loan Bank and Federal Reserve Bank stocks | 96,656 | 59,090 | |||||
Prepayments, calls, and maturities of available for sale investment securities | 158,724 | 231,019 | |||||
Prepayments, calls, and maturities of held to maturity investment securities | 58,160 | 22,916 | |||||
Sales, prepayments, calls, and maturities of other assets | 1,182 | 3,293 | |||||
Net change in tax credit investments | (7,240 | ) | 2,621 | ||||
Net cash (paid) received in acquisition | 59,605 | (217 | ) | ||||
Net cash used in investing activities | (350,336 | ) | (32,374 | ) | |||
Cash Flow From Financing Activities | |||||||
Net increase (decrease) in deposits | (801,310 | ) | (60,413 | ) | |||
Net increase (decrease) in short-term funding | 1,124,869 | (11,168 | ) | ||||
Repayment of long-term funding | (250,000 | ) | (8 | ) | |||
Proceeds from issuance of common stock for stock-based compensation plans | 10,691 | 17,940 | |||||
Redemption of preferred shares | (78 | ) | — | ||||
Purchase of common stock returned to authorized but unissued | (26,480 | ) | — | ||||
Purchase of treasury stock for tax withholding | (5,240 | ) | (7,743 | ) | |||
Cash dividends on common stock | (25,710 | ) | (18,368 | ) | |||
Cash dividends on preferred stock | (2,339 | ) | (2,330 | ) | |||
Net cash provided by financing activities | 24,403 | (82,090 | ) | ||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | (282,840 | ) | 47,235 | ||||
Cash, cash equivalents, and restricted cash at beginning of period | 716,018 | 642,233 | |||||
Cash, cash equivalents, and restricted cash at end of period | $ | 433,178 | $ | 689,468 | |||
Supplemental disclosures of cash flow information | |||||||
Cash paid for interest | $ | 50,286 | $ | 26,531 | |||
Cash paid for income taxes | 926 | 1,052 | |||||
Loans and bank premises transferred to other real estate owned | 2,129 | 921 | |||||
Capitalized mortgage servicing rights | 9,873 | 1,920 | |||||
Loans transferred into held for sale from portfolio, net | 3,012 | 13,905 | |||||
Unsettled trades to purchase securities | 12,095 | — | |||||
Acquisition | |||||||
Fair value of assets acquired, including cash and cash equivalents | 2,567,123 | — | |||||
Fair value ascribed to goodwill and intangible assets | 242,576 | 217 | |||||
Fair value of liabilities assumed | 2,809,565 | — | |||||
Common stock issued in acquisition | 134 | — |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
($ in Thousands) | |||||||
Cash and cash equivalents | $ | 350,837 | $ | 618,903 | |||
Restricted cash | 82,341 | 70,565 | |||||
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | $ | 433,178 | $ | 689,468 |
Purchase Accounting Adjustments | February 1, 2018 | |||||
($ in Thousands) | ||||||
Assets | ||||||
Cash and cash equivalents | $ | — | $ | 78,052 | ||
Investment securities | (6,238 | ) | 452,867 | |||
Federal Home Loan Bank stock, at cost | — | 20,026 | ||||
Loans | (48,533 | ) | 1,875,386 | |||
Premises and equipment, net | 11,172 | 50,930 | ||||
Bank owned life insurance | (24 | ) | 65,390 | |||
Goodwill | 166,870 | |||||
Core deposit intangibles (included in other intangible assets, net on the face of the Consolidated Balance Sheet) | 58,100 | 58,100 | ||||
Other real estate owned | (246 | ) | 4,403 | |||
Others assets | $ | 5,098 | $ | 37,151 | ||
Total assets | $ | 2,809,175 | ||||
Liabilities | ||||||
Deposits | $ | 2,498 | $ | 1,840,950 | ||
Other borrowings | 935 | 430,946 | ||||
Other liabilities | $ | 2,148 | $ | 55,591 | ||
Total liabilities | $ | 2,327,487 | ||||
Total consideration paid | $ | 481,688 |
Standard | Description | Date of adoption | Effect on financial statements | |||
ASU 2018-02 Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income | The FASB issued the amendment to allow a reclassification from accumulated other comprehensive income to retained earnings, the stranded tax effects resulting from the Tax Cuts and Jobs Act. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the update is permitted and should be applied in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate related to the Act is recognized. | 1st Quarter 2018 | The Corporation has elected to early adopt this Update. During the quarter, the Corporation reclassified approximately $14 million from accumulated other comprehensive income to retained earnings as a result of the Tax Cuts and Jobs Act. No material impact to its results of operations, financial position, and liquidity. See Consolidated Statements of Comprehensive Income and the Statement of Changes in Stockholders' Equity. |
Standard | Description | Date of adoption | Effect on financial statements | |||
ASU 2017-12 Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities | The FASB issued the amendment to better align a company’s financial reporting for hedging activities with the economic objectives of those activities for both financial (e.g., interest rate) and commodity risks. The provisions create more transparency around how economic results are presented, both on the face of the financial statements and in the footnotes. It also contains targeted improvements to simplify the application of hedge accounting guidance. This amendment is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Entities should apply the amendment on a modified retrospective transition method in which the cumulative effect of the change will be recognized within equity in the consolidated balance sheet as of the date of adoption. Early adoption is permitted, including in an interim period. If an entity early adopts in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes the interim period. | 1st Quarter 2018 | The Corporation has elected to early adopt this Update. No material impact to its results of operations, financial position, and liquidity. See Note 10 for expanded disclosures. | |||
ASU 2017-07 Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost | The FASB issued the update to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost, including a requirement that employers disaggregate the service cost component from the other components of net benefit cost. In addition, the amendments provide explicit guidance on how to present the service cost component and the other components of net benefit cost in the income statement and allow only the service cost component of net benefit cost to be eligible for capitalization. This amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Entities should apply the amendment retrospectively to each period presented and prospectively only for the capitalization component. Early adoption is permitted, but should be within the first interim period if interim financial statements are issued. | 1st Quarter 2018 | No impact to its results of operations, financial position, and liquidity. The Update required retrospective restatement. For the full year 2017, the Corporation reclassified approximately $9 million from personnel expense to other noninterest expense for the non-service cost components of net periodic pension cost and net periodic postretirement benefit cost. See Note 14 for expanded disclosure. | |||
ASU 2017-01 Business Combinations (Topic 805): Clarifying the Definition of a Business | The FASB issued amendments to clarify the definition of a business in order to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets versus businesses. The new standard narrows the definition of a business by adding three principal clarifications if: (1) substantially all the fair value of the gross assets in the asset group is concentrated in either a single identifiable asset or group of similar identifiable assets the transaction does not involve a business (2) the asset group does not include a minimum of an input and a substantive process, it does not represent a business, and (3) the integrated set of activities (including its inputs and processes) does not create, or have the ability to create, goods or services to customers, investment income (e,g. dividends or interest) or other revenues, it is not a business. The overall intention is to provide consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable. | 1st Quarter 2018 | No material impact on results of operations, financial position, or liquidity. | |||
ASU 2016-18 Statement of Cash Flows (Topic 230): Restricted Cash | The FASB issued an amendment to improve GAAP by providing guidance on the presentation of restricted cash or restricted cash equivalents in the statement of cash flows, in order to reduce diversity in practice. The amendment requires that a statement of cash flow explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included in cash and cash equivalents when reconciling the beginning and end of period total amounts shown on the statement of cash flow. This amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Entities should apply the amendment retrospectively to each period presented. Early adoption is permitted, including in an interim period. | 1st Quarter 2018 | No impact to its results of operations, financial position, and liquidity. See Consolidated Statements of Cash Flows. | |||
ASU 2016-16 Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory | The FASB issued an amendment requiring an entity to recognize income tax consequences on an intra-entity transfer of an asset other than inventory at the time the transaction occurs. This amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Entities should apply the amendment by means of a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Early adoption is permitted for all entities in the first interim period if an entity issues interim financial statements. | 1st Quarter 2018 | No material impact on results of operations, financial position, or liquidity. | |||
ASU 2016-15 Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments | The FASB issued an amendment to provide clarification on where to classify cash flows involving certain cash receipts and cash payments. Under the new guidance, cash payments for debt prepayment or debt extinguishment costs should be classified as cash outflows for financing activities. The new guidance also details the specific classification of contingent consideration cash payments made after a business combination depending on the timing of payments. Lastly, cash proceeds received from corporate owned life insurance policies (including BOLI) should be classified as cash inflows from investing, while the cash payments for the premiums may be classified as cash outflows for investing, operating, or a combination of both. This amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Entities should apply the amendment retrospectively to each period presented. Early adoption is permitted, including in an interim period; however, all of the amendments must be adopted in the same period. | 1st Quarter 2018 | No material impact on results of operations, financial position, or liquidity. |
Standard | Description | Date of adoption | Effect on financial statements | |||
ASU 2016-01 Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities | The FASB issued an amendment to address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. This amendment supersedes the guidance to classify equity securities with readily determinable fair values into different categories, requires equity securities to be measured at fair value with changes in the fair value recognized through net income, and simplifies the impairment assessment of equity investments without readily determinable fair values. The amendment requires public business entities that are required to disclose the fair value of financial instruments measured at amortized cost on the balance sheet to measure that fair value using the exit price notion. The amendment requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option. The amendment requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or in the accompanying notes to the financial statements. The amendment reduces diversity in current practice by clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available for sale securities in combination with the entity’s other deferred tax assets. This amendment is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Entities are required to apply the amendment by means of a cumulative-effect adjustment as of the beginning of the fiscal year of adoption, with the exception of the amendment related to equity securities without readily determinable fair values, which should be applied prospectively to equity investments that exist as of the date of adoption. ASC 2018-04 supersedes previous SEC guidance in the Codification in SAB Topic 5 M. Other-Than-Temporary Impairment of certain investments in equity securities and special balance sheet requirements in Reg S-X rule 3A-05 for public utility Holding companies. | 1st Quarter 2018 | The Corporation has adopted with Update using the cumulative-effect adjustment as of the beginning of the fiscal year of adoption. Immaterial impact to the result of operations, financial position and liquidity. In 2008, the Corporation received Visa Class B restricted shares as part of Visa’s initial public offering. Based on the existing transfer restriction and the uncertainty of the covered litigation, the approximately 119 thousand Class B shares remaining that the Corporation owned as of March 31, 2018 are carried at a zero cost basis. See Consolidated Statements of Comprehensive Income and Note 13 Fair Value Measurements. | |||
ASU 2014-09 Revenue from Contracts with Customers (Topic 606) | The FASB issued an amendment to clarify the principles for recognizing revenue and to develop a common revenue standard. The standard outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that “an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” In applying the revenue model to contracts within its scope, an entity should apply the following steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The standard applies to all contracts with customers except those that are within the scope of other topics in the FASB Codification. The standard also requires significantly expanded disclosures about revenue recognition. The FASB continues to release new accounting guidance related to the adoption of this standard, which could impact the Corporation's preliminary materiality analysis and may change the conclusions reached as to the application of this new guidance. The amendment was originally to be effective for annual reporting periods beginning after December 15, 2016 (including interim reporting periods within those periods); however, in July 2015, the FASB approved a one year deferral of the effective date to December 31, 2017. | 1st Quarter 2018 | The Corporation chose to adopt this Update using the modified retrospective approach with no material impact on the Corporation's results of operations, financial position, or liquidity. See Note 17 for expanded disclosure requirements. |
For the Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
(In Thousands, except per share data) | |||||||
Net income | $ | 69,456 | $ | 56,270 | |||
Preferred stock dividends | (2,339 | ) | (2,330 | ) | |||
Net income available to common equity | $ | 67,117 | $ | 53,940 | |||
Common shareholder dividends | (25,572 | ) | (18,251 | ) | |||
Unvested share-based payment awards | (138 | ) | (117 | ) | |||
Undistributed earnings | $ | 41,407 | $ | 35,572 | |||
Undistributed earnings allocated to common shareholders | 41,225 | 35,294 | |||||
Undistributed earnings allocated to unvested share-based payment awards | 182 | 278 | |||||
Undistributed earnings | $ | 41,407 | $ | 35,572 | |||
Basic | |||||||
Distributed earnings to common shareholders | $ | 25,572 | $ | 18,251 | |||
Undistributed earnings allocated to common shareholders | 41,225 | 35,294 | |||||
Total common shareholders earnings, basic | $ | 66,797 | $ | 53,545 | |||
Diluted | |||||||
Distributed earnings to common shareholders | $ | 25,572 | $ | 18,251 | |||
Undistributed earnings allocated to common shareholders | 41,225 | 35,294 | |||||
Total common shareholders earnings, diluted | $ | 66,797 | $ | 53,545 | |||
Weighted average common shares outstanding | 163,520 | 150,815 | |||||
Effect of dilutive common stock awards | 2,038 | 2,216 | |||||
Effect of dilutive common stock warrants | 874 | 838 | |||||
Diluted weighted average common shares outstanding | 166,432 | 153,869 | |||||
Basic earnings per common share | $ | 0.41 | $ | 0.36 | |||
Diluted earnings per common share | $ | 0.40 | $ | 0.35 |
2018 | 2017 | ||||
Dividend yield | 2.50 | % | 2.00 | % | |
Risk-free interest rate | 2.60 | % | 2.00 | % | |
Weighted average expected volatility | 22.00 | % | 25.00 | % | |
Weighted average expected life | 5.75 years | 5.5 years | |||
Weighted average per share fair value of options | $4.47 | $5.30 |
Stock Options | Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term | Aggregate Intrinsic Value(a) | |||||
Outstanding at December 31, 2017 | 5,118,687 | $ | 18.02 | 6.48 | $ | 38,028 | |||
Granted | 938,740 | 24.50 | |||||||
Assumed from Bank Mutual acquisition | 370,051 | 14.35 | |||||||
Exercised | (529,869 | ) | 17.37 | ||||||
Forfeited or expired | (24,130 | ) | 23.35 | ||||||
Outstanding at March 31, 2018 | 5,873,479 | $ | 18.86 | 6.80 | $ | 35,879 | |||
Options Exercisable at March 31, 2018 | 3,659,277 | $ | 16.72 | 5.55 | $ | 30,009 |
(a) | $ in Thousands |
Restricted Stock | Shares | Weighted Average Grant Date Fair Value | ||||
Outstanding at December 31, 2017 | 2,026,071 | $ | 19.68 | |||
Granted | 570,341 | 24.63 | ||||
Vested | (498,988 | ) | 17.97 | |||
Forfeited | (5,799 | ) | 20.16 | |||
Outstanding at March 31, 2018 | 2,091,625 | $ | 21.86 |
March 31, 2018 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
($ in Thousands) | ||||||||||||||||
Investment securities available for sale | ||||||||||||||||
U. S. Treasury securities | $ | 1,002 | $ | — | $ | (7 | ) | $ | 995 | |||||||
Residential mortgage-related securities | ||||||||||||||||
FNMA / FHLMC | 427,480 | 7,331 | (4,738 | ) | 430,073 | |||||||||||
GNMA | 2,364,339 | 21 | (54,054 | ) | 2,310,306 | |||||||||||
Private-label | 1,051 | — | (7 | ) | 1,044 | |||||||||||
GNMA commercial mortgage-related securities | 1,497,573 | — | (49,204 | ) | 1,448,369 | |||||||||||
FFELP asset backed securities | 288,519 | 1,835 | (54 | ) | 290,300 | |||||||||||
Other debt securities | 3,200 | — | (12 | ) | 3,188 | |||||||||||
Other equity securities | 1,599 | — | — | 1,599 | ||||||||||||
Total investment securities available for sale | $ | 4,584,763 | $ | 9,186 | $ | (108,076 | ) | $ | 4,485,875 | |||||||
Investment securities held to maturity | ||||||||||||||||
Obligations of state and political subdivisions (municipal securities) | $ | 1,424,925 | $ | 4,110 | $ | (16,579 | ) | $ | 1,412,456 | |||||||
Residential mortgage-related securities | ||||||||||||||||
FNMA / FHLMC | 76,069 | 227 | (1,665 | ) | 74,631 | |||||||||||
GNMA | 410,275 | 2,210 | (11,624 | ) | 400,861 | |||||||||||
GNMA commercial mortgage-related securities | 531,934 | 9,008 | (21,694 | ) | 519,248 | |||||||||||
Total investment securities held to maturity | $ | 2,443,203 | $ | 15,555 | $ | (51,561 | ) | $ | 2,407,197 |
December 31, 2017 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
($ in Thousands) | ||||||||||||||||
Investment securities available for sale | ||||||||||||||||
U. S. Treasury securities | $ | 1,003 | $ | — | $ | (7 | ) | $ | 996 | |||||||
Residential mortgage-related securities | ||||||||||||||||
FNMA / FHLMC | 457,680 | 9,722 | (2,634 | ) | 464,768 | |||||||||||
GNMA | 1,944,453 | 275 | (31,378 | ) | 1,913,350 | |||||||||||
Private-label | 1,067 | — | (8 | ) | 1,059 | |||||||||||
GNMA commercial mortgage-related securities | 1,547,173 | 5 | (33,901 | ) | 1,513,277 | |||||||||||
FFELP asset backed securities | 144,322 | 867 | (13 | ) | 145,176 | |||||||||||
Other debt securities | 3,200 | — | (12 | ) | 3,188 | |||||||||||
Other equity securities | 1,519 | 127 | (14 | ) | 1,632 | |||||||||||
Total investment securities available for sale | $ | 4,100,417 | $ | 10,996 | $ | (67,967 | ) | $ | 4,043,446 | |||||||
Investment securities held to maturity | ||||||||||||||||
Obligations of state and political subdivisions (municipal securities) | $ | 1,281,320 | $ | 13,899 | $ | (3,177 | ) | $ | 1,292,042 | |||||||
Residential mortgage-related securities | ||||||||||||||||
FNMA / FHLMC | 40,995 | 398 | (489 | ) | 40,904 | |||||||||||
GNMA | 414,440 | 2,700 | (6,400 | ) | 410,740 | |||||||||||
GNMA commercial mortgage-related securities | 546,098 | 9,546 | (15,756 | ) | 539,888 | |||||||||||
Total investment securities held to maturity | $ | 2,282,853 | $ | 26,543 | $ | (25,822 | ) | $ | 2,283,574 |
Available for Sale | Held to Maturity | ||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||
($ in Thousands) | |||||||||||||||
Due in one year or less | $ | 2,002 | $ | 1,995 | $ | 44,019 | $ | 44,261 | |||||||
Due after one year through five years | 2,200 | 2,188 | 221,411 | 219,411 | |||||||||||
Due after five years through ten years | — | — | 346,521 | 341,147 | |||||||||||
Due after ten years | — | — | 812,974 | 807,638 | |||||||||||
Total debt securities | 4,202 | 4,183 | 1,424,925 | 1,412,456 | |||||||||||
Residential mortgage-related securities | |||||||||||||||
FNMA / FHLMC | 427,480 | 430,073 | 76,069 | 74,631 | |||||||||||
GNMA | 2,364,339 | 2,310,306 | 410,275 | 400,861 | |||||||||||
Private-label | 1,051 | 1,044 | — | — | |||||||||||
GNMA commercial mortgage-related securities | 1,497,573 | 1,448,369 | 531,934 | 519,248 | |||||||||||
FFELP asset backed securities | 288,519 | 290,300 | — | — | |||||||||||
Equity securities | 1,599 | 1,599 | — | — | |||||||||||
Total investment securities | $ | 4,584,763 | $ | 4,485,875 | $ | 2,443,203 | $ | 2,407,197 | |||||||
Ratio of Fair Value to Amortized Cost | 97.8 | % | 98.5 | % |
Less than 12 months | 12 months or more | Total | |||||||||||||||||||||||||||
March 31, 2018 | Number of Securities | Unrealized Losses | Fair Value | Number of Securities | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | |||||||||||||||||||||
($ in Thousands) | |||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||
U.S. Treasury securities | 1 | $ | (7 | ) | $ | 995 | — | $ | — | $ | — | $ | (7 | ) | $ | 995 | |||||||||||||
Residential mortgage-related securities | |||||||||||||||||||||||||||||
FNMA / FHLMC | 12 | (1,389 | ) | 94,231 | 9 | (3,349 | ) | 135,316 | (4,738 | ) | 229,547 | ||||||||||||||||||
GNMA | 65 | (25,956 | ) | 1,590,545 | 26 | (28,098 | ) | 718,971 | (54,054 | ) | 2,309,516 | ||||||||||||||||||
Private-label | — | — | — | 1 | (7 | ) | 1,044 | (7 | ) | 1,044 | |||||||||||||||||||
GNMA commercial mortgage-related securities | 28 | (9,895 | ) | 385,319 | 76 | (39,309 | ) | 1,063,082 | (49,204 | ) | 1,448,401 | ||||||||||||||||||
FFELP asset backed securities | 6 | (54 | ) | 86,988 | — | — | — | (54 | ) | 86,988 | |||||||||||||||||||
Other debt securities | 1 | (12 | ) | 188 | — | — | — | (12 | ) | 188 | |||||||||||||||||||
Total | 113 | $ | (37,313 | ) | $ | 2,158,266 | 112 | $ | (70,763 | ) | $ | 1,918,413 | $ | (108,076 | ) | $ | 4,076,679 | ||||||||||||
Investment securities held to maturity | |||||||||||||||||||||||||||||
Obligations of state and political subdivisions (municipal securities) | 821 | $ | (9,876 | ) | $ | 523,716 | 132 | $ | (6,703 | ) | $ | 122,632 | $ | (16,579 | ) | $ | 646,348 | ||||||||||||
Residential mortgage-related securities | |||||||||||||||||||||||||||||
FNMA / FHLMC | 19 | (939 | ) | 54,122 | 10 | (725 | ) | 15,230 | (1,665 | ) | 69,352 | ||||||||||||||||||
GNMA | 58 | (7,239 | ) | 279,707 | 18 | (4,385 | ) | 113,561 | (11,624 | ) | 393,268 | ||||||||||||||||||
GNMA commercial mortgage-related securities | 2 | (837 | ) | 49,711 | 23 | (20,857 | ) | 469,538 | (21,694 | ) | 519,249 | ||||||||||||||||||
Total | 900 | $ | (18,891 | ) | $ | 907,256 | 183 | $ | (32,670 | ) | $ | 720,961 | $ | (51,561 | ) | $ | 1,628,217 |
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||||||||
December 31, 2017 | Number of Securities | Unrealized Losses | Fair Value | Number of Securities | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | ||||||||||||||||||||||
($ in Thousands) | ||||||||||||||||||||||||||||||
Investment securities available for sale | ||||||||||||||||||||||||||||||
U.S. Treasury securities | 1 | $ | (7 | ) | $ | 996 | — | $ | — | $ | — | $ | (7 | ) | $ | 996 | ||||||||||||||
Residential mortgage-related securities | ||||||||||||||||||||||||||||||
FNMA / FHLMC | 9 | (572 | ) | 69,939 | 9 | (2,062 | ) | 142,093 | (2,634 | ) | 212,032 | |||||||||||||||||||
GNMA | 44 | (8,927 | ) | 1,028,221 | 25 | (22,451 | ) | 737,198 | (31,378 | ) | 1,765,419 | |||||||||||||||||||
Private-label | — | — | — | 1 | (8 | ) | 1,059 | (8 | ) | 1,059 | ||||||||||||||||||||
GNMA commercial mortgage-related securities | 33 | (5,554 | ) | 480,514 | 70 | (28,347 | ) | 1,026,642 | (33,901 | ) | 1,507,156 | |||||||||||||||||||
FFELP asset backed securities | 1 | (13 | ) | 12,158 | — | — | — | — | (13 | ) | 12,158 | |||||||||||||||||||
Other debt securities | 1 | (12 | ) | 188 | — | — | — | (12 | ) | 188 | ||||||||||||||||||||
Other equity securities | 3 | (14 | ) | 1,487 | — | — | — | (14 | ) | 1,487 | ||||||||||||||||||||
Total | 92 | $ | (15,099 | ) | $ | 1,593,503 | 105 | $ | (52,868 | ) | $ | 1,906,992 | $ | (67,967 | ) | $ | 3,500,495 | |||||||||||||
Investment securities held to maturity | ||||||||||||||||||||||||||||||
Obligations of state and political subdivisions (municipal securities) | 157 | $ | (746 | ) | $ | 122,761 | 132 | $ | (2,431 | ) | $ | 127,043 | $ | (3,177 | ) | $ | 249,804 | |||||||||||||
Residential mortgage-related securities | ||||||||||||||||||||||||||||||
FNMA / FHLMC | 8 | (73 | ) | 13,143 | 10 | (417 | ) | 16,262 | (490 | ) | 29,405 | |||||||||||||||||||
GNMA | 35 | (3,373 | ) | 268,388 | 18 | (3,026 | ) | 120,892 | (6,399 | ) | 389,280 | |||||||||||||||||||
GNMA commercial mortgage-related securities | 2 | (299 | ) | 52,997 | 23 | (15,457 | ) | 486,891 | (15,756 | ) | 539,888 | |||||||||||||||||||
Total | 202 | $ | (4,491 | ) | $ | 457,289 | 183 | $ | (21,331 | ) | $ | 751,088 | $ | (25,822 | ) | $ | 1,208,377 |
March 31, 2018(a) | December 31, 2017 | ||||||
($ in Thousands) | |||||||
Commercial and industrial | $ | 6,756,983 | $ | 6,399,693 | |||
Commercial real estate — owner occupied | 900,913 | 802,209 | |||||
Commercial and business lending | 7,657,896 | 7,201,902 | |||||
Commercial real estate — investor | 4,077,671 | 3,315,254 | |||||
Real estate construction | 1,579,778 | 1,451,684 | |||||
Commercial real estate lending | 5,657,449 | 4,766,938 | |||||
Total commercial | 13,315,345 | 11,968,840 | |||||
Residential mortgage | 8,197,223 | 7,546,534 | |||||
Home equity | 923,470 | 883,804 | |||||
Other consumer | 374,453 | 385,813 | |||||
Total consumer | 9,495,146 | 8,816,151 | |||||
Total loans | $ | 22,810,491 | $ | 20,784,991 | |||
(a) Includes $15 million of purchased credit-impaired loans |
Pass | Special Mention | Potential Problem | Nonaccrual | Total | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Commercial and industrial | $ | 6,325,258 | $ | 132,292 | $ | 196,766 | $ | 102,667 | $ | 6,756,983 | |||||||||
Commercial real estate - owner occupied | 830,489 | 15,378 | 34,410 | 20,636 | 900,913 | ||||||||||||||
Commercial and business lending | 7,155,747 | 147,670 | 231,176 | 123,303 | 7,657,896 | ||||||||||||||
Commercial real estate - investor | 3,960,155 | 54,972 | 46,970 | 15,574 | 4,077,671 | ||||||||||||||
Real estate construction | 1,547,443 | 29,421 | 1,695 | 1,219 | 1,579,778 | ||||||||||||||
Commercial real estate lending | 5,507,598 | 84,393 | 48,665 | 16,793 | 5,657,449 | ||||||||||||||
Total commercial | 12,663,345 | 232,063 | 279,841 | 140,096 | 13,315,345 | ||||||||||||||
Residential mortgage | 8,134,387 | 5,580 | 2,155 | 55,100 | 8,197,223 | ||||||||||||||
Home equity | 908,682 | 1,383 | 188 | 13,218 | 923,470 | ||||||||||||||
Other consumer | 373,714 | 600 | — | 139 | 374,453 | ||||||||||||||
Total consumer | 9,416,783 | 7,563 | 2,343 | 68,456 | 9,495,146 | ||||||||||||||
Total | $ | 22,080,128 | $ | 239,626 | $ | 282,184 | $ | 208,553 | $ | 22,810,491 |
Pass | Special Mention | Potential Problem | Nonaccrual | Total | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Commercial and industrial | $ | 6,015,884 | $ | 157,245 | $ | 113,778 | $ | 112,786 | $ | 6,399,693 | |||||||||
Commercial real estate - owner occupied | 723,291 | 14,181 | 41,997 | 22,740 | 802,209 | ||||||||||||||
Commercial and business lending | 6,739,175 | 171,426 | 155,775 | 135,526 | 7,201,902 | ||||||||||||||
Commercial real estate - investor | 3,266,389 | 24,845 | 19,291 | 4,729 | 3,315,254 | ||||||||||||||
Real estate construction | 1,421,504 | 29,206 | — | 974 | 1,451,684 | ||||||||||||||
Commercial real estate lending | 4,687,893 | 54,051 | 19,291 | 5,703 | 4,766,938 | ||||||||||||||
Total commercial | 11,427,068 | 225,477 | 175,066 | 141,229 | 11,968,840 | ||||||||||||||
Residential mortgage | 7,490,860 | 426 | 1,616 | 53,632 | 7,546,534 | ||||||||||||||
Home equity | 868,958 | 1,137 | 195 | 13,514 | 883,804 | ||||||||||||||
Other consumer | 384,990 | 652 | — | 171 | 385,813 | ||||||||||||||
Total consumer | 8,744,808 | 2,215 | 1,811 | 67,317 | 8,816,151 | ||||||||||||||
Total | $ | 20,171,876 | $ | 227,692 | $ | 176,877 | $ | 208,546 | $ | 20,784,991 |
Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days or More Past Due(a) | Nonaccrual(b) | Total | ||||||||||||||||||
($ in Thousands) | |||||||||||||||||||||||
Commercial and industrial | $ | 6,653,188 | $ | 793 | $ | 87 | $ | 248 | $ | 102,667 | $ | 6,756,983 | |||||||||||
Commercial real estate - owner occupied | 879,766 | 511 | — | — | 20,636 | 900,913 | |||||||||||||||||
Commercial and business lending | 7,532,954 | 1,304 | 87 | 248 | 123,303 | 7,657,896 | |||||||||||||||||
Commercial real estate - investor | 4,061,600 | 240 | — | 257 | 15,574 | 4,077,671 | |||||||||||||||||
Real estate construction | 1,578,069 | 220 | 270 | — | 1,219 | 1,579,778 | |||||||||||||||||
Commercial real estate lending | 5,639,669 | 460 | 270 | 257 | 16,793 | 5,657,449 | |||||||||||||||||
Total commercial | 13,172,623 | 1,764 | 357 | 505 | 140,096 | 13,315,345 | |||||||||||||||||
Residential mortgage | 8,125,707 | 9,876 | 5,257 | 1,283 | 55,100 | 8,197,223 | |||||||||||||||||
Home equity | 904,305 | 4,485 | 1,383 | 79 | 13,218 | 923,470 | |||||||||||||||||
Other consumer | 370,977 | 1,058 | 753 | 1,526 | 139 | 374,453 | |||||||||||||||||
Total consumer | 9,400,989 | 15,419 | 7,393 | 2,888 | 68,456 | 9,495,146 | |||||||||||||||||
Total | $ | 22,573,612 | $ | 17,184 | $ | 7,750 | $ | 3,393 | $ | 208,553 | $ | 22,810,491 |
(a) | The recorded investment in loans past due 90 days or more and still accruing totaled $3 million at March 31, 2018 (the same as the reported balances for the accruing loans noted above). |
(b) | Of the total nonaccrual loans, $159 million or 76% were current with respect to payment at March 31, 2018. |
Current | 30-59 Days Past Due | 60-89 Days Past Due | 90 Days or More Past Due(a) | Nonaccrual(b) | Total | ||||||||||||||||||
($ in Thousands) | |||||||||||||||||||||||
Commercial and industrial | $ | 6,286,369 | $ | 170 | $ | 101 | $ | 267 | $ | 112,786 | $ | 6,399,693 | |||||||||||
Commercial real estate - owner occupied | 779,421 | 48 | — | — | 22,740 | 802,209 | |||||||||||||||||
Commercial and business lending | 7,065,790 | 218 | 101 | 267 | 135,526 | 7,201,902 | |||||||||||||||||
Commercial real estate - investor | 3,310,000 | 374 | — | 151 | 4,729 | 3,315,254 | |||||||||||||||||
Real estate construction | 1,450,459 | 168 | 83 | — | 974 | 1,451,684 | |||||||||||||||||
Commercial real estate lending | 4,760,459 | 542 | 83 | 151 | 5,703 | 4,766,938 | |||||||||||||||||
Total commercial | 11,826,249 | 760 | 184 | 418 | 141,229 | 11,968,840 | |||||||||||||||||
Residential mortgage | 7,483,350 | 9,186 | 366 | — | 53,632 | 7,546,534 | |||||||||||||||||
Home equity | 863,465 | 5,688 | 1,137 | — | 13,514 | 883,804 | |||||||||||||||||
Other consumer | 382,186 | 1,227 | 780 | 1,449 | 171 | 385,813 | |||||||||||||||||
Total consumer | 8,729,001 | 16,101 | 2,283 | 1,449 | 67,317 | 8,816,151 | |||||||||||||||||
Total | $ | 20,555,250 | $ | 16,861 | $ | 2,467 | $ | 1,867 | $ | 208,546 | $ | 20,784,991 |
(a) | The recorded investment in loans past due 90 days or more and still accruing totaled $2 million at December 31, 2017 (the same as the reported balances for the accruing loans noted above). |
(b) | Of the total nonaccrual loans, $135 million or 65% were current with respect to payment at December 31, 2017. |
Recorded Investment | Unpaid Principal Balance | Related Allowance | Average Recorded Investment | Interest Income Recognized | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Loans with a related allowance | |||||||||||||||||||
Commercial and industrial | $ | 76,452 | $ | 81,091 | $ | 18,778 | $ | 77,130 | $ | 312 | |||||||||
Commercial real estate — owner occupied | 16,264 | 16,617 | 2,043 | 22,978 | 47 | ||||||||||||||
Commercial and business lending | 92,716 | 97,708 | 20,821 | 100,108 | 359 | ||||||||||||||
Commercial real estate — investor | 18,582 | 18,619 | 2,721 | 16,559 | 464 | ||||||||||||||
Real estate construction | 458 | 532 | 82 | 461 | 7 | ||||||||||||||
Commercial real estate lending | 19,040 | 19,151 | 2,803 | 17,020 | 471 | ||||||||||||||
Total commercial | 111,756 | 116,859 | 23,624 | 117,128 | 830 | ||||||||||||||
Residential mortgage | 38,438 | 40,851 | 6,635 | 40,475 | 431 | ||||||||||||||
Home equity | 10,762 | 11,383 | 3,719 | 10,238 | 136 | ||||||||||||||
Other consumer | 1,066 | 1,069 | 116 | 1,067 | 1 | ||||||||||||||
Total consumer | 50,266 | 53,303 | 10,470 | 51,780 | 568 | ||||||||||||||
Total loans(a) | $ | 162,022 | $ | 170,162 | $ | 34,094 | $ | 168,908 | $ | 1,398 | |||||||||
Loans with no related allowance | |||||||||||||||||||
Commercial and industrial | $ | 52,389 | $ | 76,720 | $ | — | $ | 55,897 | $ | (348 | ) | ||||||||
Commercial real estate — owner occupied | 6,225 | 7,276 | — | 2,403 | — | ||||||||||||||
Commercial and business lending | 58,614 | 83,996 | — | 58,300 | (348 | ) | |||||||||||||
Commercial real estate — investor | 1,805 | 1,853 | — | — | — | ||||||||||||||
Real estate construction | — | — | — | — | — | ||||||||||||||
Commercial real estate lending | 1,805 | 1,853 | — | — | — | ||||||||||||||
Total commercial | 60,419 | 85,849 | — | 58,300 | (348 | ) | |||||||||||||
Residential mortgage | 10,425 | 10,871 | — | 6,317 | 39 | ||||||||||||||
Home equity | 212 | 212 | — | 639 | 1 | ||||||||||||||
Other consumer | — | — | — | — | — | ||||||||||||||
Total consumer | 10,637 | 11,083 | — | 6,956 | 40 | ||||||||||||||
Total loans(a) | $ | 71,056 | $ | 96,932 | $ | — | $ | 65,256 | $ | (308 | ) | ||||||||
Total | |||||||||||||||||||
Commercial and industrial | $ | 128,841 | $ | 157,811 | $ | 18,778 | $ | 133,027 | $ | (36 | ) | ||||||||
Commercial real estate — owner occupied | 22,489 | 23,893 | 2,043 | 25,381 | 47 | ||||||||||||||
Commercial and business lending | 151,330 | 181,704 | 20,821 | 158,408 | 11 | ||||||||||||||
Commercial real estate — investor | 20,387 | 20,472 | 2,721 | 16,559 | 464 | ||||||||||||||
Real estate construction | 458 | 532 | 82 | 461 | 7 | ||||||||||||||
Commercial real estate lending | 20,845 | 21,004 | 2,803 | 17,020 | 471 | ||||||||||||||
Total commercial | 172,175 | 202,708 | 23,624 | 175,428 | 482 | ||||||||||||||
Residential mortgage | 48,863 | 51,722 | 6,635 | 46,792 | 470 | ||||||||||||||
Home equity | 10,974 | 11,595 | 3,719 | 10,877 | 137 | ||||||||||||||
Other consumer | 1,066 | 1,069 | 116 | 1,067 | 1 | ||||||||||||||
Total consumer | 60,903 | 64,386 | 10,470 | 58,736 | 608 | ||||||||||||||
Total loans(a) | $ | 233,078 | $ | 267,094 | $ | 34,094 | $ | 234,164 | $ | 1,090 |
(a) | The net recorded investment (defined as recorded investment, net of the related allowance) of the impaired loans represented 74% of the unpaid principal balance at March 31, 2018. |
Recorded Investment | Unpaid Principal Balance | Related Allowance | Average Recorded Investment | Interest Income Recognized | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Loans with a related allowance | |||||||||||||||||||
Commercial and industrial | $ | 81,649 | $ | 83,579 | $ | 10,838 | $ | 58,494 | $ | 2,629 | |||||||||
Commercial real estate — owner occupied | 23,796 | 23,937 | 2,973 | 12,124 | 736 | ||||||||||||||
Commercial and business lending | 105,445 | 107,516 | 13,811 | 70,618 | 3,365 | ||||||||||||||
Commercial real estate — investor | 17,823 | 17,862 | 1,597 | 16,924 | 1,694 | ||||||||||||||
Real estate construction | 467 | 578 | 86 | 484 | 29 | ||||||||||||||
Commercial real estate lending | 18,290 | 18,440 | 1,683 | 17,408 | 1,723 | ||||||||||||||
Total commercial | 123,735 | 125,956 | 15,494 | 88,026 | 5,088 | ||||||||||||||
Residential mortgage | 40,561 | 42,922 | 6,512 | 40,411 | 1,614 | ||||||||||||||
Home equity | 10,250 | 10,986 | 3,718 | 10,521 | 549 | ||||||||||||||
Other consumer | 1,135 | 1,138 | 122 | 1,140 | 3 | ||||||||||||||
Total consumer | 51,946 | 55,046 | 10,352 | 52,072 | 2,166 | ||||||||||||||
Total loans(a) | $ | 175,681 | $ | 181,002 | $ | 25,846 | $ | 140,098 | $ | 7,254 | |||||||||
Loans with no related allowance | |||||||||||||||||||
Commercial and industrial | $ | 60,595 | $ | 82,839 | $ | — | $ | 89,275 | $ | 492 | |||||||||
Commercial real estate — owner occupied | 2,438 | 2,829 | — | 1,948 | 36 | ||||||||||||||
Commercial and business lending | 63,033 | 85,668 | — | 91,223 | 528 | ||||||||||||||
Commercial real estate — investor | 1,295 | 1,295 | — | — | 45 | ||||||||||||||
Real estate construction | — | — | — | — | — | ||||||||||||||
Commercial real estate lending | 1,295 | 1,295 | — | — | 45 | ||||||||||||||
Total commercial | 64,328 | 86,963 | — | 91,223 | 573 | ||||||||||||||
Residential mortgage | 6,925 | 7,204 | — | 4,999 | 217 | ||||||||||||||
Home equity | 641 | 645 | — | 540 | 7 | ||||||||||||||
Other consumer | — | — | — | — | — | ||||||||||||||
Total consumer | 7,566 | 7,849 | — | 5,539 | 224 | ||||||||||||||
Total loans(a) | $ | 71,894 | $ | 94,812 | $ | — | $ | 96,762 | $ | 797 | |||||||||
Total | |||||||||||||||||||
Commercial and industrial | $ | 142,244 | $ | 166,418 | $ | 10,838 | $ | 147,769 | $ | 3,121 | |||||||||
Commercial real estate — owner occupied | 26,234 | 26,766 | 2,973 | 14,072 | 772 | ||||||||||||||
Commercial and business lending | 168,478 | 193,184 | 13,811 | 161,841 | 3,893 | ||||||||||||||
Commercial real estate — investor | 19,118 | 19,157 | 1,597 | 16,924 | 1,739 | ||||||||||||||
Real estate construction | 467 | 578 | 86 | 484 | 29 | ||||||||||||||
Commercial real estate lending | 19,585 | 19,735 | 1,683 | 17,408 | 1,768 | ||||||||||||||
Total commercial | 188,063 | 212,919 | 15,494 | 179,249 | 5,661 | ||||||||||||||
Residential mortgage | 47,486 | 50,126 | 6,512 | 45,410 | 1,831 | ||||||||||||||
Home equity | 10,891 | 11,631 | 3,718 | 11,061 | 556 | ||||||||||||||
Other consumer | 1,135 | 1,138 | 122 | 1,140 | 3 | ||||||||||||||
Total consumer | 59,512 | 62,895 | 10,352 | 57,611 | 2,390 | ||||||||||||||
Total loans(a) | $ | 247,575 | $ | 275,814 | $ | 25,846 | $ | 236,860 | $ | 8,051 |
(a) | The net recorded investment (defined as recorded investment, net of the related allowance) of the impaired loans represented 80% of the unpaid principal balance at December 31, 2017. |
March 31, 2018 | December 31, 2017 | ||||||||||||||
Performing Restructured Loans | Nonaccrual Restructured Loans(a) | Performing Restructured Loans | Nonaccrual Restructured Loans(a) | ||||||||||||
($ in Thousands) | |||||||||||||||
Commercial and industrial | $ | 29,580 | $ | 886 | $ | 30,047 | $ | 1,776 | |||||||
Commercial real estate — owner occupied | 3,892 | — | 3,989 | — | |||||||||||
Commercial real estate — investor | 13,683 | 1,007 | 14,389 | — | |||||||||||
Real estate construction | 305 | 152 | 310 | 157 | |||||||||||
Residential mortgage | 19,902 | 18,640 | 17,068 | 18,991 | |||||||||||
Home equity | 8,098 | 3,117 | 7,705 | 2,537 | |||||||||||
Other consumer | 1,041 | 25 | 1,110 | 25 | |||||||||||
Total | $ | 76,501 | $ | 23,827 | $ | 74,618 | $ | 23,486 |
(a) | Nonaccrual restructured loans have been included within nonaccrual loans. |
Three Months Ended March 31, 2018 | Three Months Ended March 31, 2017 | ||||||||||||||||||||
Number of Loans | Recorded Investment(a) | Unpaid Principal Balance(b) | Number of Loans | Recorded Investment(a) | Unpaid Principal Balance(b) | ||||||||||||||||
($ in Thousands) | |||||||||||||||||||||
Commercial and industrial | 2 | $ | 92 | $ | 92 | 20 | $ | 52,326 | $ | 60,546 | |||||||||||
Commercial real estate — owner occupied | — | — | — | 1 | 204 | 204 | |||||||||||||||
Commercial real estate — investor | 1 | 1,007 | 1,037 | 1 | 733 | 744 | |||||||||||||||
Residential mortgage | 11 | 1,807 | 1,807 | 16 | 1,301 | 1,322 | |||||||||||||||
Home equity | 17 | 1,044 | 1,060 | 15 | 347 | 347 | |||||||||||||||
Other consumer | 2 | 8 | 11 | — | — | — | |||||||||||||||
Total | 33 | $ | 3,958 | $ | 4,007 | 53 | $ | 54,911 | $ | 63,163 |
(a) | Represents post-modification outstanding recorded investment. |
(b) | Represents pre-modification outstanding recorded investment. |
Three Months Ended March 31, 2018 | Three Months Ended March 31, 2017 | ||||||||||||
Number of Loans | Recorded Investment | Number of Loans | Recorded Investment | ||||||||||
($ in Thousands) | |||||||||||||
Residential mortgage | 4 | 467 | 6 | 383 | |||||||||
Home equity | 12 | 954 | 2 | 26 | |||||||||
Total | 16 | $ | 1,421 | 8 | $ | 409 |
($ 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, 2017 | $ | 123,068 | $ | 10,352 | $ | 41,059 | $ | 34,370 | $ | 29,607 | $ | 22,126 | $ | 5,298 | $ | 265,880 | ||||||||
Charge offs | (8,067 | ) | (1,042 | ) | — | (47 | ) | (493 | ) | (1,250 | ) | (1,256 | ) | (12,155 | ) | |||||||||
Recoveries | 1,468 | 17 | 8 | 236 | 362 | 573 | 168 | 2,832 | ||||||||||||||||
Net Charge offs | (6,599 | ) | (1,025 | ) | 8 | 189 | (131 | ) | (677 | ) | (1,088 | ) | (9,323 | ) | ||||||||||
Provision for loan losses | 1,377 | 2,520 | 1,215 | (6,125 | ) | 536 | 241 | 736 | 500 | |||||||||||||||
March 31, 2018 | $ | 117,847 | $ | 11,847 | $ | 42,282 | $ | 28,434 | $ | 30,012 | $ | 21,690 | $ | 4,946 | $ | 257,058 | ||||||||
Allowance for loan losses | ||||||||||||||||||||||||
Individually evaluated for impairment | $ | 18,778 | $ | 2,043 | $ | 2,721 | $ | 82 | $ | 6,635 | $ | 3,719 | $ | 116 | $ | 34,094 | ||||||||
Collectively evaluated for impairment | 99,069 | 9,804 | 39,561 | 28,352 | 23,377 | 17,971 | 4,830 | 222,964 | ||||||||||||||||
Acquired and accounted for under ASC 310-30(a) | — | — | — | — | — | — | — | — | ||||||||||||||||
Total allowance for loan losses | $ | 117,847 | $ | 11,847 | $ | 42,282 | $ | 28,434 | $ | 30,012 | $ | 21,690 | $ | 4,946 | $ | 257,058 | ||||||||
Loans | ||||||||||||||||||||||||
Individually evaluated for impairment | $ | 128,841 | $ | 22,489 | $ | 20,387 | $ | 458 | $ | 48,863 | $ | 10,974 | $ | 1,066 | $ | 233,078 | ||||||||
Collectively evaluated for impairment | 6,625,314 | 876,631 | 4,048,532 | 1,579,065 | 8,147,224 | 912,421 | 373,388 | 22,562,575 | ||||||||||||||||
Acquired and accounted for under ASC 310-30(a) | 2,828 | 1,793 | 8,752 | 255 | 1,136 | 74 | — | 14,838 | ||||||||||||||||
Total loans | $ | 6,756,983 | $ | 900,913 | $ | 4,077,671 | $ | 1,579,778 | $ | 8,197,223 | $ | 923,470 | $ | 374,453 | $ | 22,810,491 |
(a) | Loans acquired in business combinations and accounted for under ASC Subtopic 310-30 "Receivables — Loans and Debt Securities Acquired with Deteriorated Credit Quality." |
($ 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, 2016 | $ | 140,126 | $ | 14,034 | $ | 45,285 | $ | 26,932 | $ | 27,046 | $ | 20,364 | $ | 4,548 | $ | 278,335 | ||||||||
Charge offs | (44,533 | ) | (344 | ) | (991 | ) | (604 | ) | (2,611 | ) | (2,724 | ) | (4,439 | ) | (56,246 | ) | ||||||||
Recoveries | 11,465 | 173 | 242 | 74 | 927 | 3,194 | 716 | 16,791 | ||||||||||||||||
Net Charge offs | (33,068 | ) | (171 | ) | (749 | ) | (530 | ) | (1,684 | ) | 470 | (3,723 | ) | (39,455 | ) | |||||||||
Provision for loan losses | 16,010 | (3,511 | ) | (3,477 | ) | 7,968 | 4,245 | 1,292 | 4,473 | 27,000 | ||||||||||||||
December 31, 2017 | $ | 123,068 | $ | 10,352 | $ | 41,059 | $ | 34,370 | $ | 29,607 | $ | 22,126 | $ | 5,298 | $ | 265,880 | ||||||||
Allowance for loan losses | ||||||||||||||||||||||||
Individually evaluated for impairment | $ | 10,838 | $ | 2,973 | $ | 1,597 | $ | 86 | $ | 6,512 | $ | 3,718 | $ | 122 | $ | 25,846 | ||||||||
Collectively evaluated for impairment | 112,230 | 7,379 | 39,462 | 34,284 | 23,095 | 18,408 | 5,176 | 240,034 | ||||||||||||||||
Total allowance for loan losses | $ | 123,068 | $ | 10,352 | $ | 41,059 | $ | 34,370 | $ | 29,607 | $ | 22,126 | $ | 5,298 | $ | 265,880 | ||||||||
Loans | ||||||||||||||||||||||||
Individually evaluated for impairment | $ | 142,244 | $ | 26,234 | $ | 19,118 | $ | 467 | $ | 47,486 | $ | 10,891 | $ | 1,135 | $ | 247,575 | ||||||||
Collectively evaluated for impairment | 6,257,449 | 775,975 | 3,296,136 | 1,451,217 | 7,499,048 | 872,913 | 384,678 | 20,537,416 | ||||||||||||||||
Total loans | $ | 6,399,693 | $ | 802,209 | $ | 3,315,254 | $ | 1,451,684 | $ | 7,546,534 | $ | 883,804 | $ | 385,813 | $ | 20,784,991 |
($ in Millions) | Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | |||||
Balance at beginning of period | $ | 27 | $ | 38 | |||
Charge offs | (4 | ) | (25 | ) | |||
Recoveries | — | — | |||||
Net Charge offs | (4 | ) | (25 | ) | |||
Provision for loan losses | (4 | ) | 14 | ||||
Balance at end of period | $ | 19 | $ | 27 | |||
Allowance for loan losses | |||||||
Individually evaluated for impairment | $ | 10 | $ | 5 | |||
Collectively evaluated for impairment | 9 | 22 | |||||
Total allowance for loan losses | $ | 19 | $ | 27 | |||
Loans | |||||||
Individually evaluated for impairment | $ | 69 | $ | 77 | |||
Collectively evaluated for impairment | 588 | 523 | |||||
Total loans | $ | 657 | $ | 600 |
Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | ||||||
($ in Thousands) | |||||||
Allowance for Unfunded Commitments | |||||||
Balance at beginning of period | $ | 24,400 | $ | 25,400 | |||
Provision for unfunded commitments | (500 | ) | (1,000 | ) | |||
Amount recorded at acquisition | 2,436 | — | |||||
Balance at end of period | $ | 26,336 | $ | 24,400 |
• | Performing loans are accounted for in accordance with ASC Topic 310-20 "Nonrefundable Fees and Other Costs" as these loans do not have evidence of credit deterioration since origination. |
• | Nonperforming loans are accounted for in accordance with ASC Topic 310-30 as they display significant credit deterioration since origination. |
Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | ||||||
($ in Thousands) | |||||||
Changes in Accretable Yield | |||||||
Balance at beginning of period | $ | — | $ | — | |||
Purchases | 4,244 | — | |||||
Accretion | — | — | |||||
Other (a) | — | — | |||||
Balance at end of period | $ | 4,244 | $ | — |
(a) | Represents the accretable difference that is relieved when a loan exits the PCI population due to full payoff, full charge-off, or transfer to repossessed assets, etc. |
Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | ||||||
($ in Thousands) | |||||||
Core deposit intangibles | |||||||
Gross carrying amount | $ | 58,100 | $ | 4,385 | |||
Accumulated amortization | (968 | ) | (4,385 | ) | |||
Net book value | $ | 57,132 | $ | — | |||
Additions during the periods | $ | 58,100 | $ | — | |||
Amortization during the year | $ | 968 | $ | 112 | |||
Other intangibles | |||||||
Gross carrying amount | $ | 42,131 | $ | 34,572 | |||
Accumulated amortization | (19,549 | ) | (18,992 | ) | |||
Net book value | $ | 22,582 | $ | 15,580 | |||
Additions during the period | $ | 7,559 | $ | 2,162 | |||
Amortization during the year | $ | 557 | $ | 1,847 |
Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | ||||||
($ in Thousands) | |||||||
Mortgage servicing rights | |||||||
Mortgage servicing rights at beginning of period | $ | 59,168 | $ | 62,085 | |||
Additions from acquisition | 8,136 | — | |||||
Additions | 1,737 | 7,167 | |||||
Amortization | (2,324 | ) | (10,084 | ) | |||
Mortgage servicing rights at end of period | $ | 66,717 | $ | 59,168 | |||
Valuation allowance at beginning of period | (784 | ) | (609 | ) | |||
(Additions) recoveries, net | 474 | (175 | ) | ||||
Valuation allowance at end of period | (310 | ) | (784 | ) | |||
Mortgage servicing rights, net | $ | 66,407 | $ | 58,384 | |||
Fair value of mortgage servicing rights | $ | 81,810 | $ | 64,387 | |||
Portfolio of residential mortgage loans serviced for others (“servicing portfolio”) | $ | 8,507,294 | $ | 7,646,846 | |||
Mortgage servicing rights, net to servicing portfolio | 0.78 | % | 0.76 | % | |||
Mortgage servicing rights expense (a) | $ | 1,849 | $ | 10,259 |
(a) | Includes the amortization of mortgage servicing rights and additions / recoveries to the valuation allowance of mortgage servicing rights, and is a component of mortgage banking, net in the consolidated statements of income. |
Estimated Amortization Expense | Core Deposit Intangibles | Other Intangibles | Mortgage Servicing Rights | ||||||||
($ in Thousands) | |||||||||||
Nine Months Ended December 31, 2018 | $ | 4,358 | $ | 2,045 | $ | 7,115 | |||||
2019 | 5,810 | 2,428 | 9,324 | ||||||||
2020 | 5,810 | 2,311 | 8,078 | ||||||||
2021 | 5,810 | 2,287 | 6,977 | ||||||||
2022 | 5,810 | 2,263 | 6,035 | ||||||||
2023 | 5,810 | 2,244 | 5,234 | ||||||||
Beyond 2023 | 23,724 | 9,004 | 23,954 | ||||||||
Total Estimated Amortization Expense | $ | 57,132 | $ | 22,582 | $ | 66,717 |
March 31, 2018 | December 31, 2017 | ||||||
($ in Thousands) | |||||||
Short-Term Funding | |||||||
Federal funds purchased | $ | 69,085 | $ | 141,950 | |||
Securities sold under agreements to repurchase | 214,869 | 182,865 | |||||
Federal funds purchased and securities sold under agreements to repurchase | 283,954 | 324,815 | |||||
FHLB advances | 1,780,000 | 284,000 | |||||
Commercial paper | 82,420 | 67,467 | |||||
Other short-term funding | 1,862,420 | 351,467 | |||||
Total short-term funding | $ | 2,146,374 | $ | 676,282 | |||
Long-Term Funding | |||||||
FHLB advances | $ | 2,735,887 | $ | 2,900,168 | |||
Senior notes, at par | 250,000 | 250,000 | |||||
Subordinated notes, at par | 250,000 | 250,000 | |||||
Other long-term funding and capitalized costs | (2,549 | ) | (2,718 | ) | |||
Total long-term funding | 3,233,338 | 3,397,450 | |||||
Total short and long-term funding | $ | 5,379,712 | $ | 4,073,732 |
Remaining Contractual Maturity of the Agreements | |||||||||||||||||||
Overnight and Continuous | Up to 30 days | 30-90 days | Greater than 90 days | Total | |||||||||||||||
March 31, 2018 | ($ in Thousands) | ||||||||||||||||||
Repurchase agreements | |||||||||||||||||||
Agency mortgage-related securities | $ | 214,869 | $ | — | $ | — | $ | — | $ | 214,869 | |||||||||
Total | $ | 214,869 | $ | — | $ | — | $ | — | $ | 214,869 | |||||||||
December 31, 2017 | |||||||||||||||||||
Repurchase agreements | |||||||||||||||||||
Agency mortgage-related securities | $ | 182,865 | $ | — | $ | — | $ | — | $ | 182,865 | |||||||||
Total | $ | 182,865 | $ | — | $ | — | $ | — | $ | 182,865 |
March 31, 2018 | December 31, 2017 | ||||||||||||||||||
($ in Thousands) | Notional Amount | Fair Value | Balance Sheet Category | Notional Amount | Fair Value | Balance Sheet Category | |||||||||||||
Derivatives not designated as hedging instruments | |||||||||||||||||||
Interest rate-related instruments — customer and mirror | $ | 2,626,982 | $ | 53,189 | Trading assets | $ | 2,183,687 | $ | 28,494 | Trading assets | |||||||||
Interest rate-related instruments — customer and mirror | 2,626,982 | (52,238 | ) | Trading liabilities | 2,183,687 | (28,035 | ) | Trading liabilities | |||||||||||
Foreign currency exchange forwards | 140,554 | 2,612 | Trading assets | 124,851 | 2,495 | Trading assets | |||||||||||||
Foreign currency exchange forwards | 137,073 | (2,484 | ) | Trading liabilities | 118,094 | (2,339 | ) | Trading liabilities | |||||||||||
Commodity contracts | 467,979 | 47,089 | Trading assets | 457,868 | 38,686 | Trading assets | |||||||||||||
Commodity contracts | 467,957 | (45,525 | ) | Trading liabilities | 457,108 | (37,286 | ) | Trading liabilities | |||||||||||
Interest rate lock commitments (mortgage) | 312,567 | 3,032 | Other assets | 222,736 | 1,538 | Other assets | |||||||||||||
Forward commitments (mortgage) | 245,000 | (303 | ) | Other liabilities | 164,567 | (313 | ) | Other liabilities | |||||||||||
Purchased options (time deposit) | 26,389 | 951 | Other assets | 31,063 | 1,175 | Other assets | |||||||||||||
Written options (time deposit) | 26,389 | (951 | ) | Other liabilities | 31,063 | (1,175 | ) | Other liabilities | |||||||||||
Derivatives designated as hedging instruments | |||||||||||||||||||
Interest Rate Products | 250,000 | 258 | Other assets | — | — | Other assets |
Line Item in the Statement of Financial Position in Which the Hedged Item is Included | |||||||
Carrying Amount of the Hedged Assets/(Liabilities) | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | ||||||
($ in Thousands) | March 31, 2018 | ||||||
Loans and investment securities receivables (a) | 249,724 | 276 | |||||
Total | $ | 249,724 | $ | 276 |
(a) | These amounts include the amortized cost basis of closed portfolios used to designated hedging relationships in which the hedged item is the last layer expected to be remaining at the end of the hedging relationship. At March 31, 2018, the amortized cost basis of the closed portfolios used in these hedging relationships was $523 million; the cumulative basis adjustments associated with these hedging relationships was $275,767; and the amounts of the designated hedged items were $250 million. |
Location and Amount of Gain or (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships | ||||||||
Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | |||||||
($ in Thousands) | Interest Income | Other Income (Expense) | Interest Income | Other Income (Expense) | ||||
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded | 18 | — | — | — | ||||
The effects of fair value and cash flow hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20 | ||||||||
Interest contracts | ||||||||
Hedged items | 276 | — | — | — | ||||
Derivatives designated as hedging instruments | (258 | ) | — | — | — |
Income Statement Category of Gain / (Loss) Recognized in Income | For the Three Months Ended March 31, | |||||||
($ in Thousands) | 2018 | 2017 | ||||||
Derivative Instruments | ||||||||
Interest rate-related instruments — customer and mirror, net | Capital market fees, net | $ | 492 | $ | 245 | |||
Interest rate lock commitments (mortgage) | Mortgage banking, net | 1,494 | 1,597 | |||||
Forward commitments (mortgage) | Mortgage banking, net | 10 | (3,281 | ) | ||||
Foreign currency exchange forwards | Capital market fees, net | (28 | ) | (21 | ) | |||
Commodity contracts | Capital market fees, net | 164 | 226 |
Gross amounts recognized | Gross amounts not offset in the balance sheet | ||||||||||||||||||||||
Gross amounts offset in the balance sheet | Net amounts presented in the balance sheet | Financial instruments | Collateral | Net amount | |||||||||||||||||||
($ in Thousands) | |||||||||||||||||||||||
March 31, 2018 | |||||||||||||||||||||||
Derivative assets | |||||||||||||||||||||||
Interest and commodity agreements | $ | 47,528 | $ | — | $ | 47,528 | $ | (43,105 | ) | $ | (1,337 | ) | $ | 3,086 | |||||||||
Derivative liabilities | |||||||||||||||||||||||
Interest and commodity agreements | $ | 43,105 | $ | — | $ | 43,105 | $ | (43,105 | ) | $ | — | $ | — | ||||||||||
December 31, 2017 | |||||||||||||||||||||||
Derivative assets | |||||||||||||||||||||||
Interest and commodity agreements | $ | 29,503 | $ | — | $ | 29,503 | $ | (29,503 | ) | $ | — | $ | — | ||||||||||
Derivative liabilities | |||||||||||||||||||||||
Interest and commodity agreements | $ | 37,164 | $ | — | $ | 37,164 | $ | (29,503 | ) | $ | (7,661 | ) | $ | — |
March 31, 2018 | December 31, 2017 | |||||
($ in Thousands) | ||||||
Commitments to extend credit, excluding commitments to originate residential mortgage loans held for sale (a) (b) | $ | 8,481,563 | $ | 8,027,187 | ||
Commercial letters of credit (a) | 12,456 | 11,886 | ||||
Standby letters of credit (c) | 253,857 | 235,361 |
(a) | These off-balance sheet financial instruments are exercisable at the market rate prevailing at the date the underlying transaction will be completed and, thus, are deemed to have no current fair value, or the fair value is based on fees currently charged to enter into similar agreements and is not material at March 31, 2018 or December 31, 2017. |
(b) | Interest rate lock commitments to originate residential mortgage loans held for sale are considered derivative instruments and are disclosed in Note 10. |
(c) | The Corporation has established a liability of $2 million at March 31, 2018 and December 31, 2017, as an estimate of the fair value of these financial instruments. |
Three Months Ended March 31, 2018 | Year Ended December 31, 2017 | ||||||
($ in Thousands) | |||||||
Balance at beginning of period | $ | 987 | $ | 900 | |||
Repurchase provision expense | 56 | 246 | |||||
Charge offs, net | (48 | ) | (159 | ) | |||
Amount recorded at acquisition | 88 | — | |||||
Balance at end of period | $ | 1,083 | $ | 987 |
Fair Value Hierarchy | March 31, 2018 | December 31, 2017 | |||||||
($ in Thousands) | |||||||||
Assets | |||||||||
Investment securities available for sale | |||||||||
U.S. Treasury securities | Level 1 | $ | 995 | $ | 996 | ||||
Residential mortgage-related securities | |||||||||
FNMA / FHLMC | Level 2 | 430,073 | 464,768 | ||||||
GNMA | Level 2 | 2,310,306 | 1,913,350 | ||||||
Private-label | Level 2 | 1,044 | 1,059 | ||||||
GNMA commercial mortgage-related securities | Level 2 | 1,448,369 | 1,513,277 | ||||||
FFELP asset backed securities | Level 2 | 290,300 | 145,176 | ||||||
Other equity securities | Level 1 | 1,599 | 1,632 | ||||||
Other debt securities | Level 2 | 3,188 | 3,188 | ||||||
Total investment securities available for sale | Level 1 | 2,594 | 2,628 | ||||||
Total investment securities available for sale | Level 2 | 4,483,281 | 4,040,818 | ||||||
Residential loans held for sale | Level 2 | 103,953 | 85,544 | ||||||
Commercial loans held for sale | Level 2 | 6,091 | — | ||||||
Interest rate-related instruments | Level 2 | 53,189 | 28,494 | ||||||
Foreign currency exchange forwards | Level 2 | 2,612 | 2,495 | ||||||
Interest rate products (designated as hedging instruments) | Level 2 | 258 | — | ||||||
Interest rate lock commitments to originate residential mortgage loans held for sale | Level 3 | 3,032 | 1,538 | ||||||
Commodity contracts | Level 2 | 47,089 | 38,686 | ||||||
Purchased options (time deposit) | Level 2 | 951 | 1,175 | ||||||
Liabilities | |||||||||
Interest rate-related instruments | Level 2 | $ | 52,238 | $ | 28,035 | ||||
Foreign currency exchange forwards | Level 2 | 2,484 | 2,339 | ||||||
Forward commitments to sell residential mortgage loans | Level 3 | 303 | 313 | ||||||
Commodity contracts | Level 2 | 45,525 | 37,286 | ||||||
Written options (time deposit) | Level 2 | 951 | 1,175 |
Investment Securities Available for Sale | Derivative Financial Instruments | ||||||
($ in Thousands) | |||||||
Balance December 31, 2016 | $ | 200 | $ | 3,114 | |||
Total net gains (losses) included in income | |||||||
Mortgage derivative gain (loss) | — | (1,889 | ) | ||||
Transfer out of level 3 securities (a) | (200 | ) | — | ||||
Balance December 31, 2017 | $ | — | $ | 1,225 | |||
Total net gains (losses) included in income | |||||||
Mortgage derivative gain (loss) | — | 1,501 | |||||
Balance March 31, 2018 | $ | — | $ | 2,726 |
Income Statement Category of Adjustment Recognized in Income | Adjustment Recognized in Income | |||||||||
($ in Thousands) | Fair Value Hierarchy | Fair Value | ||||||||
March 31, 2018 | ||||||||||
Assets | ||||||||||
Commercial loans held for sale(a) | Level 2 | $ | 6,091 | Provision for credit losses | $ | — | ||||
Impaired loans(b) | Level 3 | 74,038 | Provision for credit losses(c) | (14,518 | ) | |||||
Other real estate owned | Level 2 | 2,088 | Foreclosure / OREO expense, net | (553 | ) | |||||
Mortgage servicing rights | Level 3 | 81,810 | Mortgage banking, net | 474 | ||||||
December 31, 2017 | ||||||||||
Assets | ||||||||||
Impaired loans(b) | Level 3 | $ | 92,534 | Provision for credit losses(c) | $ | (32,159 | ) | |||
Other real estate owned | Level 2 | 2,604 | Foreclosure / OREO expense, net | (939 | ) | |||||
Mortgage servicing rights | Level 3 | 64,387 | Mortgage banking, net | (175 | ) |
(a) | Commercial loans held for sale are carried at the lower of cost or estimated fair value. When the cost is less than or equal to the estimated fair value, no adjustment is recognized in income. |
(b) | Represents individually evaluated impaired loans, net of the related allowance for loan losses. |
(c) | Represents provision for credit losses on individually evaluated impaired loans. |
Valuation Technique | Significant Unobservable Input | Weighted Average Input Applied | |||
March 31, 2018 | |||||
Mortgage servicing rights | Discounted cash flow | Discount rate | 11% | ||
Mortgage servicing rights | Discounted cash flow | Constant prepayment rate | 9% | ||
Impaired Loans | Appraisals / Discounted cash flow | Collateral / Discount factor | 28% |
March 31, 2018 | December 31, 2017 | ||||||||||||||||
Fair Value Hierarchy Level | Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
($ in Thousands) | |||||||||||||||||
Financial assets | |||||||||||||||||
Cash and due from banks | Level 1 | $ | 328,260 | $ | 328,260 | $ | 483,666 | $ | 483,666 | ||||||||
Interest-bearing deposits in other financial institutions | Level 1 | 94,918 | 94,918 | 199,702 | 199,702 | ||||||||||||
Federal funds sold and securities purchased under agreements to resell | Level 1 | 10,000 | 10,000 | 32,650 | 32,650 | ||||||||||||
Investment securities held to maturity | Level 2 | 2,443,203 | 2,407,197 | 2,282,853 | 2,283,574 | ||||||||||||
Investment securities available for sale | Level 1 | 2,594 | 2,594 | 2,628 | 2,628 | ||||||||||||
Investment securities available for sale | Level 2 | 4,483,281 | 4,483,281 | 4,040,818 | 4,040,818 | ||||||||||||
FHLB and Federal Reserve Bank stocks | Level 2 | 233,216 | 233,216 | 165,331 | 165,331 | ||||||||||||
Residential loans held for sale | Level 2 | 103,953 | 103,953 | 85,544 | 85,544 | ||||||||||||
Commercial loans held for sale | Level 2 | 6,091 | 6,091 | — | — | ||||||||||||
Loans, net | Level 3 | 22,553,433 | 22,195,415 | 20,519,111 | 20,314,984 | ||||||||||||
Bank and corporate owned life insurance | Level 2 | 657,841 | 657,841 | 591,057 | 591,057 | ||||||||||||
Derivatives (trading and other assets) | Level 2 | 104,099 | 104,099 | 70,850 | 70,850 | ||||||||||||
Derivatives (trading and other assets) | Level 3 | 3,032 | 3,032 | 1,538 | 1,538 | ||||||||||||
Financial liabilities | |||||||||||||||||
Noninterest-bearing demand, savings, interest-bearing demand, and money market accounts | Level 3 | $ | 21,148,230 | $ | 21,148,230 | $ | 20,436,893 | $ | 20,436,893 | ||||||||
Brokered CDs and other time deposits | Level 2 | 2,677,372 | 2,677,372 | 2,349,069 | 2,349,069 | ||||||||||||
Short-term funding | Level 2 | 2,146,374 | 2,146,374 | 676,282 | 676,282 | ||||||||||||
Long-term funding | Level 2 | 3,233,338 | 3,242,517 | 3,397,450 | 3,411,368 | ||||||||||||
Standby letters of credit(a) | Level 2 | 2,468 | 2,468 | 2,402 | 2,402 | ||||||||||||
Derivatives (trading and other liabilities) | Level 2 | 101,198 | 101,198 | 68,835 | 68,835 | ||||||||||||
Derivatives (trading and other liabilities) | Level 3 | 303 | 303 | 313 | 313 |
(a) | The commitment on standby letters of credit was $254 million and $235 million at March 31, 2018 and December 31, 2017, respectively. See Note 12 for additional information on the standby letters of credit and for information on the fair value of lending-related commitments. |
Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
($ in Thousands) | |||||||
Components of Net Periodic Benefit Cost | |||||||
RAP | |||||||
Service cost | $ | 1,893 | $ | 1,781 | |||
Interest cost | 1,660 | 1,756 | |||||
Expected return on plan assets | (4,755 | ) | (4,881 | ) | |||
Amortization of prior service cost | (19 | ) | (19 | ) | |||
Amortization of actuarial loss | 463 | 488 | |||||
Total net pension cost | $ | (759 | ) | $ | (875 | ) | |
Bank Mutual Pension Plan (a) | |||||||
Interest cost | $ | 433 | N/A | ||||
Expected return on plan assets | (532 | ) | N/A | ||||
Total net pension cost | $ | (99 | ) | N/A | |||
Postretirement Plan (b) | |||||||
Interest cost | $ | 26 | $ | 24 | |||
Amortization of prior service cost | (19 | ) | (19 | ) | |||
Amortization of actuarial loss | 2 | — | |||||
Total net periodic benefit cost | $ | 9 | $ | 5 |
(a) | The reported figures for first quarter 2018 only include two months of expense due to the timing of the Bank Mutual acquisition. See Note 2 for additional information on the Bank Mutual acquisition. |
(b) | The portion of the Postretirement Plan attributed to Bank Mutual's Postretirement Plan only includes two months of expense due to the timing of the Bank Mutual acquisition. See Note 2 for additional information on the Bank Mutual acquisition. |
Segment Income Statement Data | |||||||||||||||
($ in Thousands) | Corporate and Commercial Specialty | Community, Consumer, and Business | Risk Management and Shared Services | Consolidated Total | |||||||||||
Three Months Ended March 31, 2018 | |||||||||||||||
Net interest income | $ | 95,958 | $ | 103,543 | $ | 10,370 | $ | 209,871 | |||||||
Noninterest income | 12,683 | 74,036 | 3,661 | 90,380 | |||||||||||
Total revenue | 108,641 | 177,579 | 14,031 | 300,251 | |||||||||||
Credit provision(a) | 10,598 | 4,966 | (15,563 | ) | — | ||||||||||
Noninterest expense | 39,250 | 127,144 | 46,571 | 212,965 | |||||||||||
Income (loss) before income taxes | 58,793 | 45,469 | (16,977 | ) | 87,285 | ||||||||||
Income tax expense (benefit) | 11,426 | 9,549 | (3,146 | ) | 17,829 | ||||||||||
Net income (loss) | $ | 47,367 | $ | 35,920 | $ | (13,831 | ) | $ | 69,456 | ||||||
Return on average allocated capital (ROCET1)(b) | 16.4 | % | 23.0 | % | (11.2 | )% | 11.4 | % | |||||||
Three Months Ended March 31, 2017 | |||||||||||||||
Net interest income | $ | 89,388 | $ | 88,928 | $ | 1,958 | $ | 180,274 | |||||||
Noninterest income | 11,993 | 64,870 | 2,968 | 79,831 | |||||||||||
Total revenue | 101,381 | 153,798 | 4,926 | 260,105 | |||||||||||
Credit provision(a) | 11,580 | 4,507 | (7,087 | ) | 9,000 | ||||||||||
Noninterest expense | 37,479 | 116,097 | 20,115 | 173,691 | |||||||||||
Income (loss) before income taxes | 52,322 | 33,194 | (8,102 | ) | 77,414 | ||||||||||
Income tax expense (benefit) | 17,649 | 11,618 | (8,123 | ) | 21,144 | ||||||||||
Net income | $ | 34,673 | $ | 21,576 | $ | 21 | $ | 56,270 | |||||||
Return on average allocated capital (ROCET1)(b) | 12.6 | % | 15.2 | % | (2.5 | )% | 10.6 | % |
Segment Balance Sheet Data | |||||||||||||||
($ in Thousands) | Corporate and Commercial Specialty | Community, Consumer, and Business | Risk Management and Shared Services | Consolidated Total | |||||||||||
Three Months Ended March 31, 2018 | |||||||||||||||
Average earning assets | $ | 11,389,211 | $ | 10,137,899 | $ | 7,755,022 | $ | 29,282,132 | |||||||
Average loans | 11,378,390 | 10,133,202 | 566,936 | 22,078,529 | |||||||||||
Average deposits | 8,057,246 | 13,096,782 | 2,496,870 | 23,650,898 | |||||||||||
Average allocated capital (CET1)(b) | $ | 1,171,038 | $ | 632,723 | $ | 586,172 | $ | 2,389,933 | |||||||
Three Months Ended March 31, 2017 | |||||||||||||||
Average earning assets | $ | 10,759,811 | $ | 9,130,457 | $ | 6,449,046 | $ | 26,339,314 | |||||||
Average loans | 10,753,314 | 9,128,656 | 190,755 | 20,072,725 | |||||||||||
Average deposits | 6,420,401 | 11,337,064 | 3,708,257 | 21,465,722 | |||||||||||
Average allocated capital (CET1)(b) | $ | 1,114,610 | $ | 576,464 | $ | 370,675 | $ | 2,061,749 |
(a) | The consolidated credit provision is equal to the actual reported provision for credit losses. |
(b) | The Federal Reserve establishes capital adequacy requirements for the Corporation, including common equity Tier 1. For segment reporting purposes, the ROCET1 reflects return on average allocated common equity Tier 1. The ROCET1 for the Risk Management and Shared Services segment and the Consolidated Total is inclusive of the annualized effect of the preferred stock dividends. |
($ in Thousands) | Investment Securities Available For Sale | Defined Benefit Pension and Post Retirement Obligations | Accumulated Other Comprehensive Income (Loss) | ||||||||
Balance January 1, 2018 | $ | (38,453 | ) | $ | (24,305 | ) | $ | (62,758 | ) | ||
Other comprehensive income (loss) before reclassifications | (41,834 | ) | — | (41,834 | ) | ||||||
Amounts reclassified from accumulated other comprehensive income (loss) | |||||||||||
Personnel expense | — | (38 | ) | (38 | ) | ||||||
Other expense | — | 465 | 465 | ||||||||
Adjustment for adoption of ASU 2016-01 | (84 | ) | — | (84 | ) | ||||||
Adjustment for adoption of ASU 2018-02 | (8,419 | ) | (5,235 | ) | (13,654 | ) | |||||
Interest income (amortization of net unrealized losses (gains) on available for sale securities transferred to held to maturity securities) | (297 | ) | — | (297 | ) | ||||||
Income tax (expense) benefit | 10,635 | (107 | ) | 10,528 | |||||||
Net other comprehensive income (loss) during period | (40,000 | ) | (4,915 | ) | (44,915 | ) | |||||
Balance March 31, 2018 | $ | (78,453 | ) | $ | (29,220 | ) | $ | (107,673 | ) | ||
Balance January 1, 2017 | $ | (20,079 | ) | $ | (34,600 | ) | $ | (54,679 | ) | ||
Other comprehensive income (loss) before reclassifications | (2,112 | ) | — | (2,112 | ) | ||||||
Amounts reclassified from accumulated other comprehensive income (loss) | |||||||||||
Investment securities gain (loss), net | — | — | — | ||||||||
Personnel expense | — | (38 | ) | (38 | ) | ||||||
Other expense | — | 488 | 488 | ||||||||
Interest income (amortization of net unrealized losses (gains) on available for sale securities transferred to held to maturity securities) | (1,027 | ) | — | (1,027 | ) | ||||||
Income tax (expense) benefit | 1,195 | (171 | ) | 1,024 | |||||||
Net other comprehensive income (loss) during period | (1,944 | ) | 279 | (1,665 | ) | ||||||
Balance March 31, 2017 | $ | (22,023 | ) | $ | (34,321 | ) | $ | (56,344 | ) |
Three Months Ended March 31, 2018 | |||||||||||||||
($ in Thousands) | Corporate and Commercial Specialty | Community, Consumer, and Business | Risk Management and Shared Services | Consolidated Total | |||||||||||
Insurance commissions and fees | $ | — | $ | 22,624 | $ | 24 | $ | 22,648 | |||||||
Service charges and deposit account fees | 4,225 | 12,183 | 12 | 16,420 | |||||||||||
Card-based and loan fees(1) | 315 | 9,529 | 25 | 9,869 | |||||||||||
Trust and asset management fees | — | 13,369 | — | 13,369 | |||||||||||
Brokerage commissions and fees | — | 7,032 | 241 | 7,273 | |||||||||||
Other revenue | 655 | 2,461 | 30 | 3,146 | |||||||||||
Noninterest Income (in-scope of Topic 606) | $ | 5,195 | $ | 67,198 | $ | 332 | $ | 72,725 | |||||||
Noninterest Income (out-of-scope of Topic 606) | 7,488 | 6,838 | 3,329 | 17,655 | |||||||||||
Total Noninterest Income | $ | 12,683 | $ | 74,036 | $ | 3,661 | $ | 90,380 | |||||||
(1) Loan fees are out-of-scope of Topic 606. | |||||||||||||||
Three Months Ended March 31, 2017 | |||||||||||||||
($ in Thousands) | Corporate and Commercial Specialty | Community, Consumer, and Business | Risk Management and Shared Services | Consolidated Total | |||||||||||
Insurance commissions and fees | $ | — | $ | 21,620 | $ | — | $ | 21,620 | |||||||
Service charges and deposit account fees | 4,441 | 11,889 | 26 | 16,356 | |||||||||||
Card-based and loan fees(1) | 272 | 8,144 | 5 | 8,421 | |||||||||||
Trust and asset management fees | — | 11,935 | — | 11,935 | |||||||||||
Brokerage commissions and fees | — | 4,333 | — | 4,333 | |||||||||||
Other revenue | 44 | 2,119 | 53 | 2,216 | |||||||||||
Noninterest Income (in-scope of Topic 606) | $ | 4,757 | $ | 60,040 | $ | 84 | $ | 64,881 | |||||||
Noninterest Income (out-of-scope of Topic 606) | 7,236 | 4,830 | 2,884 | 14,950 | |||||||||||
Total Noninterest Income | $ | 11,993 | $ | 64,870 | $ | 2,968 | $ | 79,831 | |||||||
(1) Loan fees are out-of-scope of Topic 606. |
Revenue Stream | Noninterest income in-scope of Topic 606 | |
Insurance commissions and fees | The Corporation's insurance revenue has two distinct performance obligations. The first performance obligation is the selling of the policy as an agent for the carrier. This performance obligation is satisfied upon binding of the policy. The second performance obligation is the ongoing servicing of the policy which is satisfied over the life of the policy. For employee benefits, the payment is typically received monthly. For property and casualty, payments can vary, but are typically received at, or in advance, of the policy period. | |
Service charges and deposit account fees | Service charges on deposit accounts consist of monthly service fees (i.e. business analysis fees and consumer service charges) and other deposit account related fees. The Corporation's performance obligation for monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Other deposit account related fees are largely transactional based, and therefore, the Corporation's performance obligation is satisfied, and related revenue recognized, at a point in time. Payment for service charges on deposit accounts is primarily received immediately or in the following month through a direct charge to customers’ accounts. | |
Card-based and loan fees(1) | Card-based and loan fees are primarily comprised of debit and credit card income, ATM fees, and merchant services income. Debit and credit card income is primarily comprised of interchange fees earned whenever the Corporation's debit and credit cards are processed through card payment networks. ATM and merchant fees are largely transactional based, and therefore, the Corporation's performance obligation is satisfied, and related revenue recognized, at a point in time. Payment is typically received immediately or in the following month. | |
Trust and asset management fees | Trust and asset management income is primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Corporation's performance obligation is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and the applicable fee rate. Payment is generally received a few days after month end through a direct charge to customers’ accounts. The Corporation's performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered. | |
Brokerage commissions and fees | Brokerage commissions and fees primarily consists of investment advisory, brokerage, retirement services, and annuities. The Corporation's performance obligation for investment advisory services and retirement services is generally satisfied, and the related revenue recognized, over the period in which the services are provided. The performance obligation for annuities is satisfied upon sale of the annuity, and therefore, the related revenue is primarily recognized at the time of sale. Payment for these services are typically received immediately or in advance of the service. |
ITEM 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations |
• | Average loans of 22.1 billion increased $2.0 billion, or 10%, from the first three months of 2017. Average deposits of $23.7 billion increased $2.2 billion, or 10%, from the first three months of 2017. For the remainder of 2018, the Corporation expects 1% to 2% quarterly loan growth and to maintain the loan to deposit ratio under 100%. |
• | Net interest income of $210 million increased $30 million, or 16%, from the first three months of 2017. Net interest margin was 2.92%, compared to 2.84% for the first three months of 2017. For the remainder of 2018, the Corporation expects an improving year over year net interest margin. |
• | Provision for credit losses was $0, down from $9 million the first three months of 2017. For the remainder of 2018, the Corporation expects the provision for loan losses will change based on changes in risk grade or other indicators of credit quality, and loan volume. |
• | Noninterest income of $90 million was up $11 million, or 13% from the first three months of 2017. For 2018, the Corporation expects noninterest income of approximately $365 million to $375 million. |
• | Noninterest expense of $213 million, including $21 million of acquisition related costs, was up $39 million, or 23% compared to the first three months 2017. For 2018, the Corporation expects noninterest expense to be approximately $825 million, which includes the $40 million of expected acquisition related costs. |
1Q18 | 4Q17 | 3Q17 | 2Q17 | 1Q17 | ||||||||||||||||
($ in Thousands, except per share data) | ||||||||||||||||||||
Net income | $ | 69,456 | $ | 50,010 | $ | 65,001 | $ | 57,983 | $ | 56,270 | ||||||||||
Net income available to common equity | 67,117 | 47,671 | 62,662 | 55,644 | 53,940 | |||||||||||||||
Earnings per common share - basic | 0.41 | 0.31 | 0.41 | 0.36 | 0.36 | |||||||||||||||
Earnings per common share - diluted | 0.40 | 0.31 | 0.41 | 0.36 | 0.35 | |||||||||||||||
Effective tax rate | 20.43 | % | 44.34 | % | 30.55 | % | 25.58 | % | 27.31 | % |
Quarter ended | ||||||||||||||||||||||||||
March 31, 2018 | December 31, 2017 | March 31, 2017 | ||||||||||||||||||||||||
Average Balance | Interest Income / Expense | Average Yield / Rate | Average Balance | Interest Income / Expense | Average Yield / Rate | Average Balance | Interest Income / Expense | Average Yield / Rate | ||||||||||||||||||
($ in Thousands) | ||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||
Earning assets | ||||||||||||||||||||||||||
Loans (1) (2) (3) | ||||||||||||||||||||||||||
Commercial and business lending | $ | 7,313,621 | $ | 74,706 | 4.14 | % | $ | 7,178,384 | $ | 68,440 | 3.79 | % | $ | 7,199,481 | $ | 60,680 | 3.42 | % | ||||||||
Commercial real estate lending | 5,399,429 | 61,504 | 4.62 | % | 4,873,889 | 49,744 | 4.05 | % | 4,999,994 | 45,135 | 3.66 | % | ||||||||||||||
Total commercial | 12,713,050 | 136,210 | 4.34 | % | 12,052,273 | 118,184 | 3.89 | % | 12,199,475 | 105,815 | 3.52 | % | ||||||||||||||
Residential mortgage | 8,010,381 | 66,402 | 3.32 | % | 7,546,288 | 59,979 | 3.18 | % | 6,564,600 | 53,306 | 3.25 | % | ||||||||||||||
Retail | 1,355,098 | 17,852 | 5.29 | % | 1,265,055 | 16,853 | 5.31 | % | 1,308,650 | 15,450 | 4.74 | % | ||||||||||||||
Total loans | 22,078,529 | 220,464 | 4.03 | % | 20,863,616 | 195,016 | 3.72 | % | 20,072,725 | 174,571 | 3.51 | % | ||||||||||||||
Investment securities | ||||||||||||||||||||||||||
Taxable | 5,576,826 | 30,104 | 2.16 | % | 4,986,279 | 25,614 | 2.05 | % | 4,830,421 | 23,475 | 1.94 | % | ||||||||||||||
Tax-exempt (1) | 1,312,913 | 11,613 | 3.54 | % | 1,206,078 | 12,909 | 4.28 | % | 1,138,010 | 12,438 | 4.37 | % | ||||||||||||||
Other short-term investments | 313,864 | 2,177 | 2.80 | % | 382,762 | 2,138 | 2.22 | % | 298,158 | 1,536 | 2.08 | % | ||||||||||||||
Investments and other | 7,203,603 | 43,894 | 2.44 | % | 6,575,119 | 40,661 | 2.47 | % | 6,266,589 | 37,449 | 2.39 | % | ||||||||||||||
Total earning assets | 29,282,132 | $ | 264,358 | 3.64 | % | 27,438,735 | $ | 235,677 | 3.42 | % | 26,339,314 | $ | 212,020 | 3.24 | % | |||||||||||
Other assets, net | 2,884,248 | 2,542,484 | 2,441,013 | |||||||||||||||||||||||
Total assets | $ | 32,166,380 | $ | 29,981,219 | $ | 28,780,327 | ||||||||||||||||||||
Liabilities and Stockholders' equity | ||||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||||||||||
Savings | $ | 1,722,665 | $ | 202 | 0.05 | % | $ | 1,554,639 | $ | 209 | 0.05 | % | $ | 1,465,811 | $ | 188 | 0.05 | % | ||||||||
Interest-bearing demand | 4,712,115 | 8,553 | 0.74 | % | 4,462,725 | 7,462 | 0.66 | % | 4,251,357 | 4,210 | 0.40 | % | ||||||||||||||
Money market | 9,415,869 | 17,827 | 0.77 | % | 8,743,614 | 14,274 | 0.65 | % | 9,169,141 | 9,388 | 0.42 | % | ||||||||||||||
Time deposits | 2,715,292 | 6,830 | 1.02 | % | 2,354,828 | 6,198 | 1.04 | % | 1,613,331 | 3,138 | 0.79 | % | ||||||||||||||
Total interest-bearing deposits | 18,565,941 | 33,412 | 0.73 | % | 17,115,806 | 28,143 | 0.65 | % | 16,499,640 | 16,924 | 0.42 | % | ||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 275,578 | 522 | 0.77 | % | 279,817 | 420 | 0.60 | % | 495,311 | 515 | 0.42 | % | ||||||||||||||
Other short-term funding | 884,633 | 3,005 | 1.38 | % | 600,492 | 1,731 | 1.14 | % | 683,306 | 1,080 | 0.64 | % | ||||||||||||||
Total short-term funding | 1,160,211 | 3,527 | 1.23 | % | 880,309 | 2,151 | 0.97 | % | 1,178,617 | 1,595 | 0.55 | % | ||||||||||||||
Long-term funding | 3,422,947 | 14,722 | 1.74 | % | 3,332,140 | 13,023 | 1.55 | % | 2,761,850 | 7,996 | 1.17 | % | ||||||||||||||
Total short and long-term funding | 4,583,158 | 18,249 | 1.61 | % | 4,212,449 | 15,174 | 1.43 | % | 3,940,467 | 9,591 | 0.98 | % | ||||||||||||||
Total interest-bearing liabilities | 23,149,099 | $ | 51,661 | 0.90 | % | 21,328,255 | $ | 43,317 | 0.81 | % | 20,440,107 | $ | 26,515 | 0.52 | % | |||||||||||
Noninterest-bearing demand deposits | 5,084,957 | 5,133,977 | 4,966,082 | |||||||||||||||||||||||
Other liabilities | 395,008 | 302,981 | 250,747 | |||||||||||||||||||||||
Stockholders’ equity | 3,537,316 | 3,216,006 | 3,123,391 | |||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 32,166,380 | $ | 29,981,219 | $ | 28,780,327 | ||||||||||||||||||||
Interest rate spread | 2.74 | % | 2.61 | % | 2.72 | % | ||||||||||||||||||||
Net free funds | 0.18 | % | 0.18 | % | 0.12 | % | ||||||||||||||||||||
Fully tax-equivalent net interest income and net interest margin | $ | 212,697 | 2.92 | % | $ | 192,360 | 2.79 | % | $ | 185,505 | 2.84 | % | ||||||||||||||
Fully tax-equivalent adjustment | 2,826 | 5,355 | 5,231 | |||||||||||||||||||||||
Net interest income | $ | 209,871 | $ | 187,005 | $ | 180,274 | ||||||||||||||||||||
Bank Mutual net accreted purchase loan discount | $ | 6,076 | $ | — | $ | — |
(1) | Beginning in 2018, the yield on tax-exempt loans and securities is computed on a fully tax-equivalent basis using a tax rate of 21% and is net of the effects of certain disallowed interest deductions. Prior to 2018, the yield on tax-exempt loans and securities was computed on a fully tax-equivalent basis using a tax rate of 35% and was net of the effects of certain disallowed interest deductions. |
(2) | Nonaccrual loans and loans held for sale have been included in the average balances. |
(3) | Interest income includes amortization of net deferred loan origination costs and net accreted purchase loan discount. |
• | Net interest income in the consolidated statements of income (which excludes the fully tax-equivalent adjustment) was $210 million for the first three months of 2018 compared to $180 million for the first three months of 2017. The primary reason for increased net interest income and earning assets from last year was the acquisition of Bank Mutual in February 2018. See sections Interest Rate Risk and Quantitative and Qualitative Disclosures about Market Risk, for a discussion of interest rate risk and market risk. |
• | Fully tax-equivalent net interest income of $213 million for the first three months of 2018 was $27 million higher than the first three months of 2017. |
• | Accreted income from the acquisition of the Bank Mutual loan portfolio contributed $6 million to net interest income for the first quarter of 2018. Approximately $2 million of the accreted income was from prepayments and other adjustments. |
• | Average earning assets of $29.3 billion for the first three months of 2018 were $2.9 billion, or 11%, higher than the first three months of 2017. Average loans increased $2.0 billion, or 10% primarily due to an increase of $1.4 billion, or 22% in residential mortgage loans. |
• | Average interest-bearing liabilities of $23.1 billion for the first three months of 2018 were up $2.7 billion, or 13% versus the first three months of 2017. On average, interest-bearing deposits increased $2.1 billion and long-term funding increased $661 million from the first three months of 2017. |
• | The net interest margin for the first three months of 2018 was 2.92%, compared to 2.84% for the first three months of 2017. |
• | The cost of interest-bearing liabilities was 0.90% for the first three months of 2018, which was 38 bps higher than the first three months of 2017. The increase was primarily due to a 31 bp increase in the cost of average interest-bearing deposits (to 0.73%) and a 68 bp increase in the cost of short-term funding (to 1.23%), both primarily due to increases in the Federal Reserve interest rate. |
• | The Federal Reserve increased the targeted federal funds rate on March 21, 2018, to a range of 1.50% to 1.75% which compares to a range of 0.75% to 1.00% at the end of the first quarter of 2017. The Federal Reserve has indicated that it expects gradual increases in the Federal Funds rate. However, the timing and magnitude of any such increases are uncertain and will depend on domestic and global economic conditions. |
1Q18 Change vs | |||||||||||||||||||
($ in Thousands) | 1Q18 | 4Q17 | 3Q17 | 2Q17 | 1Q17 | 4Q17 | 1Q17 | ||||||||||||
Insurance commissions and fees | $ | 22,648 | $ | 19,186 | $ | 19,815 | $ | 20,853 | $ | 21,620 | 18 | % | 5 | % | |||||
Service charges and deposit account fees | 16,420 | 15,773 | 16,268 | 16,030 | 16,356 | 4 | % | — | % | ||||||||||
Card-based and loan fees | 13,422 | 13,840 | 12,619 | 13,764 | 12,465 | (3 | )% | 8 | % | ||||||||||
Trust and asset management fees | 13,369 | 13,125 | 12,785 | 12,346 | 11,935 | 2 | % | 12 | % | ||||||||||
Brokerage commissions and fees | 7,273 | 6,864 | 4,392 | 4,346 | 4,333 | 6 | % | 68 | % | ||||||||||
Total core fee-based revenue | 73,132 | 68,788 | 65,879 | 67,339 | 66,709 | 6 | % | 10 | % | ||||||||||
Mortgage banking income | 8,219 | 5,507 | 9,147 | 7,692 | 7,273 | 49 | % | 13 | % | ||||||||||
Mortgage servicing rights (expense) | 1,849 | 2,337 | 2,563 | 2,665 | 2,694 | (21 | )% | (31 | )% | ||||||||||
Mortgage banking, net | 6,370 | 3,169 | 6,585 | 5,027 | 4,579 | 101 | % | 39 | % | ||||||||||
Capital markets, net | 5,306 | 7,107 | 4,610 | 4,042 | 3,883 | (25 | )% | 37 | % | ||||||||||
Bank and corporate owned life insurance | 3,187 | 3,156 | 6,580 | 3,899 | 2,615 | 1 | % | 22 | % | ||||||||||
Other | 2,492 | 2,777 | 2,254 | 2,213 | 2,279 | (10 | )% | 9 | % | ||||||||||
Subtotal | 90,487 | 84,997 | 85,908 | 82,520 | 80,065 | 6 | % | 13 | % | ||||||||||
Asset gains(losses), net | (107 | ) | (528 | ) | (16 | ) | (466 | ) | (234 | ) | (80 | )% | (54 | )% | |||||
Investment securities gains(losses), net | — | 75 | 3 | 356 | — | (100 | )% | N/M | |||||||||||
Total noninterest income | $ | 90,380 | $ | 84,544 | $ | 85,895 | $ | 82,410 | $ | 79,831 | 7 | % | 13 | % | |||||
Mortgage loans originated for sale during period | $ | 197,603 | $ | 249,222 | $ | 245,851 | $ | 119,004 | $ | 101,280 | (21 | )% | 95 | % | |||||
Mortgage loan settlements during period | $ | 187,624 | $ | 268,254 | $ | 187,568 | $ | 167,550 | $ | 196,578 | (30 | )% | (5 | )% | |||||
Assets under management, at market value (a) | $ | 10,540 | $ | 10,555 | $ | 9,243 | $ | 8,997 | $ | 8,716 | 0% | 21 | % |
• | Fee-based revenue was $73 million, an increase of $6 million (10%) compared to the first three months of 2017. Within fee based revenue, brokerage commissions and fees increased $3 million (68%), primarily due to the acquisition of Whitnell & Co in the fourth quarter of 2017. In addition, trust and asset management fees increased $1 million (12%), primarily due to an increase in assets under management. |
• | Net mortgage banking income for the first three months of 2018 was $6 million, up $2 million (39%) from the first three months of 2017, primarily due to the Corporation's strategy to hold mortgages on balance sheet during the first quarter of 2017. |
1Q18 Change vs | |||||||||||||||||||
($ in Thousands) | 1Q18 | 4Q17 | 3Q17 | 2Q17 | 1Q17 | 4Q17 | 1Q17 | ||||||||||||
Personnel(2) | $ | 117,685 | $ | 107,031 | $ | 108,098 | $ | 107,066 | $ | 106,782 | 10 | % | 10 | % | |||||
Occupancy | 15,357 | 13,497 | 12,294 | 12,832 | 15,219 | 14 | % | 1 | % | ||||||||||
Technology | 17,715 | 17,878 | 15,233 | 15,473 | 14,420 | (1 | )% | 23 | % | ||||||||||
Equipment | 5,556 | 5,250 | 5,232 | 5,234 | 5,485 | 6 | % | 1 | % | ||||||||||
Business development and advertising | 6,693 | 8,195 | 7,764 | 7,152 | 5,835 | (18 | )% | 15 | % | ||||||||||
Legal and professional | 5,413 | 6,384 | 6,248 | 5,711 | 4,166 | (15 | )% | 30 | % | ||||||||||
Card Issuance and loan costs | 3,304 | 2,836 | 3,330 | 2,974 | 2,620 | 17 | % | 26 | % | ||||||||||
Foreclosure / OREO expense, net | 723 | 1,285 | 906 | 1,182 | 1,505 | (44 | )% | (52 | )% | ||||||||||
FDIC assessment | 8,250 | 7,500 | 7,800 | 8,000 | 8,000 | 10 | % | 3 | % | ||||||||||
Other intangible amortization | 1,525 | 500 | 450 | 496 | 513 | 205 | % | 197 | % | ||||||||||
Acquisition related costs (1) | 20,605 | — | — | — | — | N/M | N/M | ||||||||||||
Other(2) | 10,140 | 11,343 | 10,072 | 10,196 | 9,146 | (11 | )% | 11 | % | ||||||||||
Total noninterest expense | $ | 212,965 | $ | 181,699 | $ | 177,427 | $ | 176,316 | $ | 173,691 | 17 | % | 23 | % |
• | Personnel expense (which includes salary-related expenses and fringe benefit expenses) was $118 million for the first three months of 2018, up $11 million (10%) from the first three months of 2017, primarily driven by the additional cost of Bank Mutual staff. |
• | All other nonpersonnel noninterest expense on a combined basis was $95 million, up $25 million compared to the first three months of 2017. The increase was primarily driven by $21 million of acquisition related costs pertaining to Bank Mutual. In addition, technology expense increased $3 million (23%) from the first three months of 2017, driven by investments in technology solutions that meet evolving customer needs and improve operational efficiency. |
• | At March 31, 2018, total assets were $33.4 billion, up $2.9 billion (9%) from December 31, 2017 and up $4.3 billion (15%) from March 31, 2017. On February 1, 2018, the Corporation added $2.8 billion of assets as a result of the Bank Mutual acquisition. |
• | Loans of $22.8 billion at March 31, 2018 were up $2.0 billion (10%) from December 31, 2017 and were up $2.7 billion (13%) from March 31, 2017. On February 1, 2018, the Corporation added $1.9 billion of loans as a result of the Bank Mutual acquisition. See section Loans for additional information on loans. |
• | At March 31, 2018, total deposits of $23.8 billion were up $1.0 billion (5%) from December 31, 2017 and were up $2.0 billion (9%) from March 31, 2017. On February 1, 2018, the Corporation assumed $1.8 billion of deposits as a result of the Bank Mutual acquisition. These inflows were partially offset by seasonal deposit outflows. See section Deposits and Customer Funding for additional information on deposits. |
• | Short and long-term funding of $5.4 billion increased $1.3 billion (32%) from December 31, 2017 and increased $1.5 billion (40%) from March 31, 2017. During the quarter, the Corporation reduced network transaction deposits with lower costs, fixed rate, short-term FHLB advances. |
March 31, 2018(a) | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | ||||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | |||||||||||||||||||||||||
($ in Thousands) | ||||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 6,756,983 | 30 | % | $ | 6,399,693 | 31 | % | $ | 6,534,660 | 31 | % | $ | 6,571,000 | 32 | % | $ | 6,300,646 | 31 | % | ||||||||||||||
Commercial real estate — owner occupied | 900,913 | 4 | % | 802,209 | 4 | % | 827,064 | 4 | % | 845,336 | 4 | % | 878,391 | 4 | % | |||||||||||||||||||
Commercial and business lending | 7,657,896 | 34 | % | 7,201,902 | 35 | % | 7,361,724 | 35 | % | 7,416,336 | 36 | % | 7,179,037 | 35 | % | |||||||||||||||||||
Commercial real estate — investor | 4,077,671 | 18 | % | 3,315,254 | 16 | % | 3,345,536 | 16 | % | 3,329,585 | 16 | % | 3,415,355 | 17 | % | |||||||||||||||||||
Real estate construction | 1,579,778 | 7 | % | 1,451,684 | 7 | % | 1,552,135 | 8 | % | 1,651,805 | 8 | % | 1,553,205 | 8 | % | |||||||||||||||||||
Commercial real estate lending | 5,657,449 | 25 | % | 4,766,938 | 23 | % | 4,897,671 | 24 | % | 4,981,390 | 24 | % | 4,968,560 | 25 | % | |||||||||||||||||||
Total commercial | 13,315,345 | 58 | % | 11,968,840 | 58 | % | 12,259,395 | 59 | % | 12,397,726 | 60 | % | 12,147,597 | 60 | % | |||||||||||||||||||
Residential mortgage | 8,197,223 | 36 | % | 7,546,534 | 36 | % | 7,408,471 | 35 | % | 7,115,457 | 34 | % | 6,715,282 | 33 | % | |||||||||||||||||||
Home equity | 923,470 | 4 | % | 883,804 | 4 | % | 890,130 | 4 | % | 897,111 | 4 | % | 911,969 | 5 | % | |||||||||||||||||||
Other consumer | 374,453 | 2 | % | 385,813 | 2 | % | 373,464 | 2 | % | 372,775 | 2 | % | 372,835 | 2 | % | |||||||||||||||||||
Total consumer | 9,495,146 | 42 | % | 8,816,151 | 42 | % | 8,672,065 | 41 | % | 8,385,343 | 40 | % | 8,000,086 | 40 | % | |||||||||||||||||||
Total loans | $ | 22,810,491 | 100 | % | $ | 20,784,991 | 100 | % | $ | 20,931,460 | 100 | % | $ | 20,783,069 | 100 | % | $ | 20,147,683 | 100 | % | ||||||||||||||
(a) Includes $15 million of purchased credit-impaired loans |
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||||||
($ in Millions) | |||||||||||||||||||
Pass | $ | 548 | $ | 483 | $ | 446 | $ | 411 | $ | 405 | |||||||||
Special mention | — | — | — | 39 | 8 | ||||||||||||||
Potential problem | 40 | 40 | 39 | 37 | 78 | ||||||||||||||
Nonaccrual | 69 | 77 | 92 | 114 | 134 | ||||||||||||||
Total oil and gas related loans | $ | 657 | $ | 600 | $ | 577 | $ | 601 | $ | 625 | |||||||||
Quarter net charge offs | $ | 4 | $ | 25 | $ | 8 | $ | 12 | $ | 6 | |||||||||
Oil and gas related allowance | $ | 19 | $ | 27 | $ | 30 | $ | 33 | $ | 42 | |||||||||
Oil and gas related allowance ratio | 2.9 | % | 4.5 | % | 5.2 | % | 5.4 | % | 6.7 | % |
March 31, 2018 | Within 1 Year (a) | 1-5 Years | After 5 Years | Total | % of Total | |||||||||||||
($ in Thousands) | ||||||||||||||||||
Commercial and industrial | $ | 5,998,575 | $ | 555,894 | $ | 202,514 | $ | 6,756,983 | 51 | % | ||||||||
Commercial real estate — investor | 3,217,012 | 762,322 | 98,338 | 4,077,671 | 31 | % | ||||||||||||
Commercial real estate — owner occupied | 458,193 | 296,889 | 145,832 | 900,913 | 7 | % | ||||||||||||
Real estate construction | 1,428,741 | 113,082 | 37,954 | 1,579,778 | 12 | % | ||||||||||||
Total | $ | 11,102,520 | $ | 1,728,186 | $ | 484,638 | $ | 13,315,345 | 100 | % | ||||||||
Fixed rate | $ | 4,604,032 | $ | 983,927 | $ | 371,720 | $ | 5,959,679 | 45 | % | ||||||||
Floating or adjustable rate | 6,498,490 | 744,259 | 112,917 | 7,355,666 | 55 | % | ||||||||||||
Total | $ | 11,102,522 | $ | 1,728,186 | $ | 484,637 | $ | 13,315,345 | 100 | % | ||||||||
Percent by maturity distribution | 83 | % | 13 | % | 4 | % | 100 | % |
(a) | Demand loans, past due loans, and overdrafts are reported in the “Within 1 Year” category. |
$ in Thousands | % to Total | ||||
2018 | $ | 388,772 | 7 | % | |
2019 | 584,096 | 11 | % | ||
2020 | 636,717 | 12 | % | ||
2021 | 741,288 | 14 | % | ||
2022 | 813,785 | 15 | % | ||
Thereafter | 2,106,599 | 41 | % | ||
Total adjustable rate mortgages | $ | 5,271,257 | 100 | % |
(a) | Based on contractual loan terms for 3/1, 5/1, 7/1, and 10/1 adjustable rate mortgages; does not factor in early prepayments or amortization. |
$ in Thousands | % of Total | |||||
Less than 5 years | $ | 93,578 | 9 | % | ||
5 to 10 years | 287,038 | 29 | % | |||
Over 10 years | 617,525 | 62 | % | |||
Total home equity revolving lines of credit | $ | 998,141 | 100 | % |
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Nonperforming assets | |||||||||||||||||||
Commercial and industrial | $ | 102,667 | $ | 112,786 | $ | 122,284 | $ | 141,475 | $ | 164,891 | |||||||||
Commercial real estate — owner occupied | 20,636 | 22,740 | 15,598 | 15,800 | 17,925 | ||||||||||||||
Commercial and business lending | 123,303 | 135,526 | 137,882 | 157,275 | 182,816 | ||||||||||||||
Commercial real estate — investor | 15,574 | 4,729 | 3,543 | 7,206 | 8,273 | ||||||||||||||
Real estate construction | 1,219 | 974 | 1,540 | 1,717 | 1,247 | ||||||||||||||
Commercial real estate lending | 16,793 | 5,703 | 5,083 | 8,923 | 9,520 | ||||||||||||||
Total commercial | 140,096 | 141,229 | 142,965 | 166,198 | 192,336 | ||||||||||||||
Residential mortgage | 55,100 | 53,632 | 54,654 | 51,975 | 54,183 | ||||||||||||||
Home equity | 13,218 | 13,514 | 12,639 | 13,482 | 13,212 | ||||||||||||||
Other consumer | 139 | 171 | 259 | 233 | 260 | ||||||||||||||
Total consumer | 68,456 | 67,317 | 67,552 | 65,690 | 67,655 | ||||||||||||||
Total nonaccrual loans | 208,553 | 208,546 | 210,517 | 231,888 | 259,991 | ||||||||||||||
Commercial real estate owned | 7,511 | 6,735 | 5,098 | 4,825 | 5,599 | ||||||||||||||
Residential real estate owned | 5,806 | 5,873 | 3,385 | 2,957 | 1,941 | ||||||||||||||
Bank properties real estate owned | 3,601 | — | — | — | — | ||||||||||||||
Other real estate owned (“OREO”) | 16,919 | 12,608 | 8,483 | 7,782 | 7,540 | ||||||||||||||
Other nonperforming assets | 7,117 | 7,418 | 7,418 | 7,418 | 7,418 | ||||||||||||||
Total nonperforming assets (“NPAs”) | $ | 232,589 | $ | 228,572 | $ | 226,418 | $ | 247,088 | $ | 274,949 | |||||||||
Accruing loans past due 90 days or more | |||||||||||||||||||
Commercial | $ | 505 | $ | 418 | $ | 308 | $ | 248 | $ | 258 | |||||||||
Consumer | 2,888 | 1,449 | 1,303 | 1,287 | 1,462 | ||||||||||||||
Total accruing loans past due 90 days or more | $ | 3,393 | $ | 1,867 | $ | 1,611 | $ | 1,535 | $ | 1,720 | |||||||||
Restructured loans (accruing) | |||||||||||||||||||
Commercial | $ | 47,460 | $ | 48,735 | $ | 51,259 | $ | 50,634 | $ | 51,274 | |||||||||
Consumer | 29,041 | 25,883 | 25,919 | 26,691 | 27,785 | ||||||||||||||
Total restructured loans (accruing) | $ | 76,501 | $ | 74,618 | $ | 77,178 | $ | 77,325 | $ | 79,059 | |||||||||
Nonaccrual restructured loans (included in nonaccrual loans) | $ | 23,827 | $ | 23,486 | $ | 33,520 | $ | 51,715 | $ | 78,902 | |||||||||
Ratios | |||||||||||||||||||
Nonaccrual loans to total loans | 0.91 | % | 1.00 | % | 1.01 | % | 1.12 | % | 1.29 | % | |||||||||
NPAs to total loans plus OREO | 1.02 | % | 1.10 | % | 1.08 | % | 1.19 | % | 1.36 | % | |||||||||
NPAs to total assets | 0.70 | % | 0.75 | % | 0.75 | % | 0.83 | % | 0.94 | % | |||||||||
Allowance for loan losses to nonaccrual loans | 123.26 | % | 127.49 | % | 131.37 | % | 121.22 | % | 108.72 | % |
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Accruing loans 30-89 days past due | |||||||||||||||||||
Commercial and industrial | $ | 880 | $ | 271 | $ | 1,378 | $ | 1,255 | $ | 1,675 | |||||||||
Commercial real estate — owner occupied | 511 | 48 | 1,522 | 1,284 | 970 | ||||||||||||||
Commercial and business lending | 1,391 | 319 | 2,900 | 2,539 | 2,645 | ||||||||||||||
Commercial real estate — investor | 240 | 374 | 1,109 | 899 | 1,122 | ||||||||||||||
Real estate construction | 490 | 251 | 700 | 135 | 431 | ||||||||||||||
Commercial real estate lending | 730 | 625 | 1,809 | 1,034 | 1,553 | ||||||||||||||
Total commercial | 2,121 | 944 | 4,709 | 3,573 | 4,198 | ||||||||||||||
Residential mortgage | 15,133 | 9,552 | 8,870 | 9,165 | 7,243 | ||||||||||||||
Home equity | 5,868 | 6,825 | 7,191 | 5,924 | 4,512 | ||||||||||||||
Other consumer | 1,811 | 2,007 | 1,686 | 1,746 | 1,658 | ||||||||||||||
Total consumer | 22,812 | 18,384 | 17,747 | 16,835 | 13,413 | ||||||||||||||
Total accruing loans 30-89 days past due | $ | 24,934 | $ | 19,328 | $ | 22,456 | $ | 20,408 | $ | 17,611 | |||||||||
Potential problem loans | |||||||||||||||||||
Commercial and industrial | $ | 196,766 | $ | 113,778 | $ | 153,779 | $ | 142,607 | $ | 218,930 | |||||||||
Commercial real estate — owner occupied | 34,410 | 41,997 | 57,468 | 60,724 | 58,994 | ||||||||||||||
Commercial and business lending | 231,176 | 155,775 | 211,247 | 203,331 | 277,924 | ||||||||||||||
Commercial real estate — investor | 46,970 | 19,291 | 46,770 | 48,569 | 49,217 | ||||||||||||||
Real estate construction | 1,695 | — | 118 | 8,901 | 10,141 | ||||||||||||||
Commercial real estate lending | 48,665 | 19,291 | 46,888 | 57,470 | 59,358 | ||||||||||||||
Total commercial | 279,841 | 175,066 | 258,135 | 260,801 | 337,282 | ||||||||||||||
Residential mortgage | 2,155 | 1,616 | 650 | 1,576 | 2,155 | ||||||||||||||
Home equity | 188 | 195 | 124 | 208 | 220 | ||||||||||||||
Total consumer | 2,343 | 1,811 | 774 | 1,784 | 2,375 | ||||||||||||||
Total potential problem loans | $ | 282,184 | $ | 176,877 | $ | 258,909 | $ | 262,585 | $ | 339,657 |
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||
($ in Thousands) | |||||||||||||||
Allowance for Loan Losses | |||||||||||||||
Balance at beginning of period | $ | 265,880 | $ | 276,551 | $ | 281,101 | $ | 282,672 | $ | 278,335 | |||||
Provision for loan losses | 500 | — | 6,000 | 11,000 | 10,000 | ||||||||||
Charge offs | (12,155 | ) | (14,289 | ) | (14,727 | ) | (15,376 | ) | (11,854 | ) | |||||
Recoveries | 2,832 | 3,618 | 4,177 | 2,805 | 6,191 | ||||||||||
Net charge offs | (9,323 | ) | (10,671 | ) | (10,550 | ) | (12,571 | ) | (5,663 | ) | |||||
Balance at end of period | $ | 257,058 | $ | 265,880 | $ | 276,551 | $ | 281,101 | $ | 282,672 | |||||
Allowance for Unfunded Commitments | |||||||||||||||
Balance at beginning of period | $ | 24,400 | $ | 24,400 | $ | 25,400 | $ | 24,400 | $ | 25,400 | |||||
Provision for unfunded commitments | (500 | ) | — | (1,000 | ) | 1,000 | (1,000 | ) | |||||||
Amount recorded at acquisition | 2,436 | — | — | — | — | ||||||||||
Balance at end of period | $ | 26,336 | $ | 24,400 | $ | 24,400 | $ | 25,400 | $ | 24,400 | |||||
Allowance for credit losses(a) | $ | 283,394 | $ | 290,280 | $ | 300,951 | $ | 306,501 | $ | 307,072 | |||||
Provision for credit losses(b) | — | — | 5,000 | 12,000 | 9,000 | ||||||||||
Net loan (charge offs) recoveries | |||||||||||||||
Commercial and industrial | $ | (6,599 | ) | $ | (8,212 | ) | $ | (9,442 | ) | $ | (11,046 | ) | $ | (4,368 | ) |
Commercial real estate — owner occupied | (1,025 | ) | (246 | ) | 13 | 43 | 19 | ||||||||
Commercial and business lending | (7,624 | ) | (8,458 | ) | (9,429 | ) | (11,003 | ) | (4,349 | ) | |||||
Commercial real estate — investor | 8 | (164 | ) | 55 | (126 | ) | (514 | ) | |||||||
Real estate construction | 189 | (365 | ) | (150 | ) | (26 | ) | 11 | |||||||
Commercial real estate lending | 197 | (529 | ) | (95 | ) | (152 | ) | (503 | ) | ||||||
Total commercial | (7,427 | ) | (8,987 | ) | (9,524 | ) | (11,155 | ) | (4,852 | ) | |||||
Residential mortgage | (131 | ) | (966 | ) | (26 | ) | (564 | ) | (128 | ) | |||||
Home equity | (677 | ) | 330 | (87 | ) | 54 | 173 | ||||||||
Other consumer | (1,088 | ) | (1,048 | ) | (913 | ) | (906 | ) | (856 | ) | |||||
Total consumer | (1,896 | ) | (1,684 | ) | (1,026 | ) | (1,416 | ) | (811 | ) | |||||
Total net charge offs | $ | (9,323 | ) | $ | (10,671 | ) | $ | (10,550 | ) | $ | (12,571 | ) | $ | (5,663 | ) |
Ratios | |||||||||||||||
Allowance for loan losses to total loans | 1.13 | % | 1.28 | % | 1.32 | % | 1.35 | % | 1.40 | % | |||||
Allowance for loan losses to net charge offs (annualized) | 6.8x | 6.3x | 6.6x | 5.6x | 12.3x |
(a) | Includes the allowance for loan losses and the allowance for unfunded commitments. |
(b) | Includes the provision for loan losses and the provision for unfunded commitments. |
(in basis points) | March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||
Net loan (charge offs) recoveries | ||||||||||
Commercial and industrial | (41 | ) | (51 | ) | (58 | ) | (69 | ) | (28 | ) |
Commercial real estate — owner occupied | (48 | ) | (12 | ) | 1 | 2 | 1 | |||
Commercial and business lending | (42 | ) | (47 | ) | (51 | ) | (60 | ) | (24 | ) |
Commercial real estate — investor | N/M | (2 | ) | 1 | (2 | ) | (6 | ) | ||
Real estate construction | 5 | (10 | ) | (4 | ) | (1 | ) | N/M | ||
Commercial real estate lending | 1 | (4 | ) | (1 | ) | (1 | ) | (4 | ) | |
Total commercial | (24 | ) | (30 | ) | (31 | ) | (36 | ) | (16 | ) |
Residential mortgage | (1 | ) | (5 | ) | N/M | (3 | ) | (1 | ) | |
Home equity | (28 | ) | 15 | (4 | ) | 2 | 8 | |||
Other consumer | (115 | ) | (109 | ) | (97 | ) | (98 | ) | (90 | ) |
Total consumer | (8 | ) | (8 | ) | (5 | ) | (7 | ) | (4 | ) |
Total net charge offs | (17 | ) | (20 | ) | (20 | ) | (25 | ) | (11 | ) |
(a) | Annualized ratio of net charge offs to average loans by loan type. |
• | Total loans increased $2.0 billion (10%) for the first three months of 2018, including a $679 million (8%) increase in total consumer. Compared to March 31, 2017, total loans increased $2.7 billion (13%), including a $1.5 billion (19%) increase in total consumer, a $689 million (14%) increase in commercial real estate lending, and a $479 million (7%) increase in commercial and business lending. See section Loans for additional information on the changes in the loan portfolio and see section Credit Risk for discussion about credit risk management for each loan type. |
• | Total nonaccrual loans were relatively unchanged for the first three months of 2018, but decreased $51 million from March 31, 2017, primarily due to migration in the oil and gas related credits. See also Note 7 Loans, of the notes to consolidated financial statements and section Nonperforming Assets for additional disclosures on the changes in asset quality. |
• | Potential problem loans increased $105 million from December 31, 2017 primarily due to the downward migration of general commercial related credits and the addition of Bank Mutual loans. However, potential problem loans decreased $57 million from March 31, 2017, primarily due to improvements in general commercial related credits and migration in oil and gas related credits, respectively. See Table 10, for additional information on the changes in potential problem loans. |
• | Net charge offs decreased $1 million from December 31, 2017, but increased $4 million from the first three months of 2017, primarily due to an increase in charge offs outside the oil and gas portfolio. See Table 12 and Table 13 for additional information regarding the activity in the allowance for loan losses. |
• | The allowance for loan losses attributable to oil and gas related credits (included within the commercial and industrial allowance for loan losses) was $19 million at March 31, 2018, compared to $27 million at December 31, 2017 and $42 million at March 31, 2017. See also Oil and gas lending within the Credit Risk section for additional disclosure. |
($ in Thousands) | March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||||||||||||||||||||
Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | |||||||||||||||||||||||||
Noninterest-bearing demand | $ | 5,458,473 | 23 | % | $ | 5,478,416 | 24 | % | $ | 5,177,734 | 23 | % | $ | 5,038,162 | 23 | % | $ | 5,338,212 | 25 | % | ||||||||||||||
Savings | 1,883,638 | 8 | % | 1,524,992 | 7 | % | 1,544,037 | 7 | % | 1,552,820 | 7 | % | 1,530,155 | 7 | % | |||||||||||||||||||
Interest-bearing demand | 4,719,566 | 20 | % | 4,603,157 | 20 | % | 4,990,891 | 22 | % | 3,858,739 | 18 | % | 4,736,236 | 22 | % | |||||||||||||||||||
Money market | 9,086,553 | 38 | % | 8,830,328 | 39 | % | 8,299,512 | 37 | % | 9,228,129 | 43 | % | 8,608,523 | 39 | % | |||||||||||||||||||
Brokered CDs | 44,503 | — | % | 18,609 | — | % | 3,554 | — | % | 131,184 | 1 | % | 54,993 | — | % | |||||||||||||||||||
Other time | 2,632,869 | 11 | % | 2,330,460 | 10 | % | 2,317,723 | 11 | % | 1,809,146 | 8 | % | 1,559,916 | 7 | % | |||||||||||||||||||
Total deposits | $ | 23,825,602 | 100 | % | $ | 22,785,962 | 100 | % | $ | 22,333,451 | 100 | % | $ | 21,618,180 | 100 | % | $ | 21,828,035 | 100 | % | ||||||||||||||
Customer funding(a) | 297,289 | 250,332 | 324,042 | 360,131 | 448,502 | |||||||||||||||||||||||||||||
Total deposits and customer funding | $ | 24,122,891 | $ | 23,036,294 | $ | 22,657,493 | $ | 21,978,311 | $ | 22,276,537 | ||||||||||||||||||||||||
Network transaction deposits(b) | $ | 2,244,739 | $ | 2,520,968 | $ | 2,622,787 | $ | 3,220,956 | $ | 3,417,380 | ||||||||||||||||||||||||
Net deposits and customer funding (total deposits and customer funding, excluding Brokered CDs and network transaction deposits) | $ | 21,833,649 | $ | 20,496,717 | $ | 20,031,152 | $ | 18,626,171 | $ | 18,804,164 | ||||||||||||||||||||||||
Time deposits of more than $250,000 | $ | 906,727 | $ | 1,056,172 | $ | 1,009,097 | $ | 477,043 | $ | 244,641 |
• | Deposits are the Corporation’s largest source of funds. |
• | Total deposits increased $1.0 billion (5%) from December 31, 2017 primarily due to the acquisition of Bank Mutual partially offset by seasonal deposit outflows and increased $2.0 billion (9%) from March 31, 2017. |
• | Non-maturity deposit accounts, comprised of savings, money market, and demand (both interest and noninterest-bearing demand) accounts accounted for 89% of our total deposits at March 31, 2018. |
• | Included in the above amounts were $2.2 billion of network deposits, primarily sourced from other financial institutions and intermediaries. These represented 9% of our total deposits at March 31, 2018. |
• | Investment securities are an important tool to the Corporation’s liquidity objective, and can be pledged or sold to enhance liquidity, if necessary. See Note 6 Investment Securities of the notes to consolidated financial statements for additional information on the Corporation's investment securities portfolio, including investment securities pledged. |
• | The Bank pledges eligible loans to both the Federal Reserve Bank and the FHLB as collateral to establish lines of credit and borrow from these entities. Based on the amount of collateral pledged, the FHLB established a collateral value from which the Bank may draw advances against the collateral. Also, the collateral is used to enable the FHLB to issue letters of credit in favor of public fund depositors of the Bank. As of March 31, 2018, the Bank had $2.4 billion available for future advances. The Federal Reserve Bank also establishes a collateral value of assets to support borrowings from the discount window. As of March 31, 2018, the Bank had $2.2 billion available for discount window borrowings. |
• | The Parent Company has a $200 million commercial paper program, of which, $82 million was outstanding as of March 31, 2018. |
• | Dividends and service fees from subsidiaries, as well as the proceeds from issuance of capital, are funding sources for the Parent Company. |
• | The Parent Company has filed a shelf registration statement with the SEC under which the Parent Company may, from time to time, offer shares of the Corporation’s common stock in connection with acquisitions of businesses, assets or securities of other companies. |
• | The Parent Company also has filed a universal shelf registration statement with the SEC, under which the Parent Company may offer the following securities, either separately or in units: debt securities, preferred stock, depositary shares, common stock, and warrants. |
• | The Bank may also issue institutional certificates of deposit, network transaction deposits, and brokered certificates of deposit. |
Moody’s | S&P(a) | ||
Associated Bank short-term deposits | P-1 | - | |
Associated Bank long-term | A1 | BBB+ | |
Corporation short-term | P-2 | - | |
Corporation long-term | Baa1 | BBB | |
Outlook | Stable | Stable |
Estimated % Change in Rate Sensitive Earnings at Risk (EAR) Over 12 Months | |||||||||||
Dynamic Forecast March 31, 2018 | Static Forecast March 31, 2018 | Dynamic Forecast December 31, 2017 | Static Forecast December 31, 2017 | ||||||||
Instantaneous Rate Change | |||||||||||
100 bp increase in interest rates | 2.6 | % | 1.7 | % | 2.5 | % | 2.7 | % | |||
200 bp increase in interest rates | 5.0 | % | 3.3 | % | 4.6 | % | 4.9 | % |
March 31, 2018 | December 31, 2017 | ||||
Instantaneous Rate Change | |||||
100 bp increase in interest rates | (3.4 | )% | (3.1 | )% | |
200 bp increase in interest rates | (6.9 | )% | (6.7 | )% |
March 31, 2018 | One Year or Less | One to Three Years | Three to Five Years | Over Five Years | Total | ||||||||||||||
($ in Thousands) | |||||||||||||||||||
Time deposits | $ | 1,893,417 | $ | 643,818 | $ | 138,198 | $ | 1,939 | $ | 2,677,372 | |||||||||
Short-term funding | 2,146,374 | — | — | — | 2,146,374 | ||||||||||||||
Long-term funding | 1,500,010 | 499,987 | 150,451 | 1,082,890 | 3,233,338 | ||||||||||||||
Operating leases | 9,815 | 18,572 | 13,881 | 22,447 | 64,715 | ||||||||||||||
Commitments to extend credit | 4,589,376 | 2,654,980 | 1,381,952 | 167,822 | 8,794,130 | ||||||||||||||
Total | $ | 10,138,992 | $ | 3,817,357 | $ | 1,684,482 | $ | 1,275,098 | $ | 16,915,929 |
1Q18 | 4Q17 | 3Q17 | 2Q17 | 1Q17 | |||||||||||||||
($ in Thousands) | |||||||||||||||||||
Risk-based Capital (a) | |||||||||||||||||||
Common equity Tier 1 | $ | 2,473,677 | $ | 2,171,508 | $ | 2,144,325 | $ | 2,130,238 | $ | 2,085,309 | |||||||||
Tier 1 capital | 2,632,912 | 2,331,245 | 2,304,037 | 2,289,831 | 2,244,863 | ||||||||||||||
Total capital | 3,164,362 | 2,848,851 | 2,823,097 | 2,808,049 | 2,757,310 | ||||||||||||||
Total risk-weighted assets | 23,535,483 | 21,544,463 | 21,657,286 | 21,590,134 | 21,128,672 | ||||||||||||||
Common equity Tier 1 capital ratio | 10.51 | % | 10.08 | % | 9.90 | % | 9.87 | % | 9.87 | % | |||||||||
Tier 1 capital ratio | 11.19 | % | 10.82 | % | 10.64 | % | 10.61 | % | 10.62 | % | |||||||||
Total capital ratio | 13.45 | % | 13.22 | % | 13.04 | % | 13.01 | % | 13.05 | % | |||||||||
Tier 1 leverage ratio | 8.48 | % | 8.02 | % | 7.93 | % | 8.09 | % | 8.05 | % | |||||||||
Selected Equity and Performance Ratios | |||||||||||||||||||
Total stockholders’ equity / assets | 11.13 | % | 10.62 | % | 10.66 | % | 10.72 | % | 10.80 | % | |||||||||
Dividend payout ratio (b) | 36.59 | % | 45.16 | % | 29.27 | % | 33.33 | % | 33.33 | % |
(a) | The Federal Reserve establishes regulatory capital requirements, including well-capitalized standards for the Corporation. The Corporation follows Basel III, subject to certain transition provisions. These regulatory capital measurements are used by management, regulators, investors, and analysts to assess, monitor and compare the quality and composition of our capital with the capital of other financial services companies. See Table 20 for a reconciliation of common equity Tier 1 and average common equity Tier 1. |
(b) | Ratio is based upon basic earnings per common share. |
Quarter Ended | |||||||||||||||
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||
($ in Thousands) | |||||||||||||||
Selected Equity and Performance Ratios (a) (b) | |||||||||||||||
Tangible common equity / tangible assets | 7.22 | % | 7.07 | % | 7.08 | % | 7.11 | % | 7.10 | % | |||||
Return on average equity | 7.96 | % | 6.17 | % | 8.10 | % | 7.35 | % | 7.31 | % | |||||
Return on average tangible common equity | 11.99 | % | 9.16 | % | 12.20 | % | 11.06 | % | 11.07 | % | |||||
Return on average Common equity Tier 1 | 11.39 | % | 8.77 | % | 11.73 | % | 10.63 | % | 10.61 | % | |||||
Return on average assets | 0.88 | % | 0.66 | % | 0.86 | % | 0.80 | % | 0.79 | % | |||||
Average stockholders' equity / average assets | 11.00 | % | 10.73 | % | 10.63 | % | 10.84 | % | 10.85 | % | |||||
Tangible Common Equity and Common Equity Tier 1 Reconciliation (a) (b) | |||||||||||||||
Common equity | $ | 3,552,846 | $ | 3,077,514 | $ | 3,043,672 | $ | 3,031,573 | $ | 2,984,865 | |||||
Goodwill and other intangible assets, net | (1,232,870 | ) | (991,819 | ) | (986,086 | ) | (986,536 | ) | (987,032 | ) | |||||
Tangible common equity | 2,319,977 | 2,085,695 | 2,057,586 | 2,045,037 | 1,997,833 | ||||||||||
Less: Accumulated other comprehensive income / loss | 107,673 | 62,758 | 54,288 | 53,470 | 56,344 | ||||||||||
Less: Deferred tax assets/deferred tax liabilities, net | 46,027 | 23,055 | 32,451 | 31,731 | 31,132 | ||||||||||
Common equity Tier 1 | $ | 2,473,677 | $ | 2,171,508 | $ | 2,144,325 | $ | 2,130,238 | $ | 2,085,309 | |||||
Tangible Assets Reconciliation (a) | |||||||||||||||
Total assets | $ | 33,366,505 | $ | 30,483,594 | $ | 30,064,547 | $ | 29,769,025 | $ | 29,109,857 | |||||
Goodwill and other intangible assets, net | (1,232,870 | ) | (991,819 | ) | (986,086 | ) | (986,536 | ) | (987,032 | ) | |||||
Tangible assets | $ | 32,133,636 | $ | 29,491,775 | $ | 29,078,461 | $ | 28,782,489 | $ | 28,122,825 | |||||
Average Tangible Common Equity and Average Common Equity Tier 1 Reconciliation (a) (b) | |||||||||||||||
Common equity | $ | 3,377,388 | $ | 3,056,077 | $ | 3,024,918 | $ | 3,005,209 | $ | 2,963,462 | |||||
Goodwill and other intangible assets, net | (1,107,503 | ) | (991,955 | ) | (986,342 | ) | (986,826 | ) | (987,135 | ) | |||||
Tangible common equity | 2,269,885 | 2,064,121 | 2,038,576 | 2,018,383 | 1,976,327 | ||||||||||
Less: Accumulated other comprehensive income / loss | 89,105 | 61,937 | 49,164 | 50,148 | 54,234 | ||||||||||
Less: Deferred tax assets/deferred tax liabilities, net | 30,943 | 29,386 | 31,935 | 31,294 | 31,188 | ||||||||||
Average common equity Tier 1 | $ | 2,389,933 | $ | 2,155,444 | $ | 2,119,675 | $ | 2,099,825 | $ | 2,061,749 | |||||
Efficiency Ratio Reconciliation (c) | |||||||||||||||
Federal Reserve efficiency ratio | 70.76 | % | 66.93 | % | 63.92 | % | 66.69 | % | 66.39 | % | |||||
Fully tax-equivalent adjustment | (0.66 | )% | (1.30 | )% | (1.21 | )% | (1.30 | )% | (1.30 | )% | |||||
Other intangible amortization | (0.51 | )% | (0.18 | )% | (0.16 | )% | (0.18 | )% | (0.20 | )% | |||||
Fully tax-equivalent efficiency ratio | 69.60 | % | 65.45 | % | 62.55 | % | 65.21 | % | 64.89 | % |
(a) | The ratio tangible common equity to tangible assets excludes goodwill and other intangible assets, net, which is a non-GAAP financial measure. This financial measure has been included as it is considered to be a critical metric with which to analyze and evaluate financial condition and capital strength. |
(b) | The Federal Reserve establishes regulatory capital requirements, including well-capitalized standards for the Corporation. The Corporation follows Basel III, subject to certain transition provisions. These regulatory capital measurements are used by management, regulators, investors, and analysts to assess, monitor and compare the quality and composition of our capital with the capital of other financial services companies. |
(c) | The efficiency ratio as defined by the Federal Reserve guidance is noninterest expense (which includes the provision for unfunded commitments) divided by the sum of net interest income plus noninterest income, excluding investment securities gains / losses, net. The fully tax-equivalent efficiency ratio is noninterest expense (which includes the provision for unfunded commitments), excluding other intangible amortization, divided by the sum of fully tax-equivalent net interest income plus noninterest income, excluding investment securities gains / losses, net. Management believes the fully tax-equivalent efficiency ratio, which adjusts net interest income for the tax-favored status of certain loans and investment securities, to be the preferred industry measurement as it enhances the comparability of net interest income arising from taxable and tax-exempt sources. |
Standard | Description | Date of adoption | Effect on financial statements | |||
ASU 2017-04 Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment | The FASB issued an amendment to simplify the subsequent quantitative measurement of goodwill by eliminating step two from the goodwill impairment test. Instead, an entity will perform only step one of its quantitative goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and then recognizing an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity will still have the option to perform a qualitative assessment for a reporting unit to determine if the quantitative step one impairment test is necessary. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Entities should apply the amendment prospectively. Early adoption is permitted, including in an interim period, for impairment tests performed after January 1, 2017. The Corporation has not had to perform a step one quantitative analysis since 2012, which concluded no impairment was necessary. | 2nd Quarter 2020, consistent with the Corporation's annual impairment test in May of each year. | The Corporation is currently evaluating the impact on its results of operations, financial position, and liquidity. | |||
ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments | The FASB issued an amendment to replace the current incurred loss impairment methodology. Under the new guidance, entities will be required to measure expected credit losses by utilizing forward-looking information to assess an entity's allowance for credit losses. The guidance also requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. This amendment is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities should apply the amendment by means of a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Early adoption is permitted. | 1st Quarter 2020 | The Corporation is currently evaluating the impact on its results of operations, financial position, and liquidity. A cross-functional team has been established to assess and implement the standard. | |||
ASU 2016-02 Leases (Topic 842) | The FASB issued an amendment to provide transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This amendment will require lessees to recognize the following for all leases (with the exception of short-term leases) at the commencement date: 1) a lease liability, which is a lessee's obligation to make lease payments arising from a lease, measured on a discounted basis; and 2) a right-of-use asset, which is an asset that represents the lessee's right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. This amendment is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018. Entities are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes a number of optional practical expedients that entities may elect to apply. These practical expedients relate to the identification and classification of leases that commenced before the effective date, initial direct costs for leases that commenced before the effective date, and the ability to use hindsight in evaluating lessee options to extend or terminate a lease or to purchase the underlying asset. Early adoption is permitted. ASU 2018-01 amendment permits an entity to elect an optional transition practical expedient to not evaluate under Topic 842 land easements that exist or expired before the entity's adoption of Topic 842. | 1st Quarter 2019 | The Corporation is currently evaluating the impact on its results of operations, financial position, and liquidity. A cross-functional team has been established to assess and implement the standard. |
ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk |
ITEM 4. | Controls and Procedures |
PART II - OTHER INFORMATION |
ITEM 1. | Legal Proceedings |
ITEM 1A. | Risk Factors |
ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Total Number of Shares Purchased(a) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs(b) | |||||||||
Period | ||||||||||||
January 1, 2018 - January 31, 2018 | — | $ | — | — | — | |||||||
February 1, 2018 - February 28, 2018 | 1,108,000 | 23.90 | 1,108,000 | — | ||||||||
March 1, 2018 - March 31, 2018 | — | — | — | — | ||||||||
Total | 1,108,000 | $ | 23.90 | 1,108,000 | 977,867 |
(a) | During the first quarter of 2018, the Corporation repurchased approximately 214,000 common shares for minimum tax withholding settlements on equity compensation. These purchases do not count against the maximum number of shares that may yet be purchased under the Board of Directors’ authorization. |
(b) | On April 21, 2015, the Board of Directors authorized the repurchase of up to $125 million of the Corporation's common stock, of which approximately $24 million remained available to repurchase as of March 31, 2018. Using the closing stock price on March 31, 2018 of $24.85, a total of approximately 1 million shares of common stock remained available to be repurchased under the previously approved Board authorizations as of March 31, 2018. |
Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs(a) | |||||||||
Period | ||||||||||||
January 1, 2018 - January 31, 2018 | — | $ | — | — | — | |||||||
February 1, 2018 - February 28, 2018 | — | — | — | — | ||||||||
March 1, 2018 - March 31, 2018 | 3,140 | 24.89 | 3,140 | — | ||||||||
Total | 3,140 | $ | 24.89 | 3,140 | 597,591 |
(a) | On July 25, 2017, the Board of Directors authorized the repurchase of up to $15 million of the depository shares of the Series D Preferred Stock, of which approximately $14.9 million remained available to repurchase as of March 31, 2018. Using the closing stock price on March 31, 2018 of $24.97, a total of approximately 598,000 shares of Series D Preferred stock remained available to be repurchased under the previously approved Board authorizations as of March 31, 2018. |
ITEM 6. | Exhibits |
Exhibit (11), Statement regarding computation of per share earnings. The information required by this item is set forth in Part I, Item 1 under Note 4 Earnings Per Common Share. |
Exhibit (101), Interactive data files pursuant to Rule 405 of Regulation S-T: (i) Unaudited Consolidated Balance Sheets, (ii) Unaudited Consolidated Statements of Income, (iii) Unaudited Consolidated Statements of Comprehensive Income, (iv) Unaudited Consolidated Statements of Changes in Stockholders’ Equity, (v) Unaudited Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements. |
ASSOCIATED BANC-CORP | ||
(Registrant) | ||
Date: April 30, 2018 | /s/ Philip B. Flynn | |
Philip B. Flynn | ||
President and Chief Executive Officer | ||
Date: April 30, 2018 | /s/ Christopher J. Del Moral-Niles | |
Christopher J. Del Moral-Niles | ||
Chief Financial Officer | ||
Date: April 30, 2018 | /s/ Tammy C. Stadler | |
Tammy C. Stadler | ||
Principal Accounting Officer |
Date: April 30, 2018 | /s/ Philip B. Flynn | |
Philip B. Flynn | ||
President and Chief Executive Officer |
Date: April 30, 2018 | /s/ Christopher J. Del Moral-Niles | |
Christopher J. Del Moral-Niles | ||
Chief Financial Officer |
/s/ Philip B. Flynn | |
Philip B. Flynn | |
Chief Executive Officer | |
April 30, 2018 |
/s/ Christopher J. Del Moral-Niles | |
Christopher J. Del Moral-Niles | |
Chief Financial Officer | |
April 30, 2018 |
Document and Entity Information - shares |
3 Months Ended | |
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Mar. 31, 2018 |
Apr. 27, 2018 |
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Document And Entity Information [Abstract] | ||
Trading Symbol | ASB | |
Entity Registrant Name | ASSOCIATED BANC-CORP | |
Entity Central Index Key | 0000007789 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 170,794,622 |
Consolidated Balance Sheets (Parenthetical) - $ / shares |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred shares, par value | $ 1.00 | $ 1.00 |
Common shares, par value | $ 0.01 | $ 0.01 |
Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands |
Total |
Preferred Equity |
Common Stock |
Surplus |
Retained Earnings |
Accumulated Other Comprehensive Income (Loss) |
Treasury Stock |
---|---|---|---|---|---|---|---|
Beginning balance at Dec. 31, 2016 | $ 3,091,312 | $ 159,929 | $ 1,630 | $ 1,459,498 | $ 1,695,764 | $ (54,679) | $ (170,830) |
Comprehensive income: | |||||||
Net income | 56,270 | 0 | 0 | 0 | 56,270 | 0 | 0 |
Other comprehensive income | (1,665) | 0 | 0 | 0 | 0 | 1,665 | 0 |
Comprehensive income | 54,605 | ||||||
Common stock issued: | |||||||
Stock-based compensation plans, net | 17,940 | 0 | 0 | 868 | (21,822) | 0 | 38,894 |
Purchase of treasury stock | (7,743) | 0 | 0 | 0 | 0 | 0 | (7,743) |
Cash dividends: | |||||||
Common stock dividends ($0.12 per share in 2016 and $0.15 per share in 2017) | (18,368) | 0 | 0 | 0 | (18,368) | 0 | 0 |
Preferred stock dividends | (2,330) | 0 | 0 | 0 | (2,330) | 0 | 0 |
Stock-based compensation expense, net | 8,344 | 0 | 0 | 8,344 | 0 | 0 | 0 |
Other | 1,034 | 0 | 0 | 1,034 | 0 | 0 | 0 |
Ending balance at Mar. 31, 2017 | 3,144,794 | 159,929 | 1,630 | 1,469,744 | 1,709,514 | (56,344) | (139,679) |
Beginning balance at Dec. 31, 2017 | 3,237,443 | 159,929 | 1,618 | 1,454,188 | 1,819,230 | (62,758) | (134,764) |
Comprehensive income: | |||||||
Net income | 69,456 | 0 | 0 | 0 | 69,456 | 0 | 0 |
Other comprehensive income | (44,915) | 0 | 0 | 0 | 0 | 0 | |
AOCI Loss Net of ASU Adoption and Tax | (31,177) | (31,177) | |||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | (13,738) | 0 | 0 | 0 | 0 | (13,738) | 0 |
Comprehensive income | 24,541 | ||||||
Common stock issued: | |||||||
Stock-based compensation plans, net | 10,691 | 0 | 0 | 2,148 | (16,076) | 0 | 24,619 |
Stock Issued for Bank Mutual Acquisitions | 481,688 | 0 | 134 | 390,258 | 0 | 0 | 91,296 |
Purchase of common stock returned to authorized but unissued | (26,480) | (11) | (26,469) | 0 | 0 | 0 | |
Purchase of treasury stock | (5,240) | 0 | 0 | 0 | 0 | 0 | (5,240) |
Cash dividends: | |||||||
Common stock dividends ($0.12 per share in 2016 and $0.15 per share in 2017) | (25,710) | 0 | 0 | 0 | (25,710) | 0 | 0 |
Preferred stock dividends | (2,339) | 0 | 0 | 0 | (2,339) | 0 | 0 |
Preferred Stock Redemption Premium | (78) | (76) | 0 | 0 | (2) | 0 | 0 |
Stock-based compensation expense, net | 3,675 | 0 | 0 | 3,675 | 0 | 0 | 0 |
Tax Act Reclassification (2018-2) | 13,654 | 0 | 0 | 0 | 13,654 | 0 | |
Change in Equity Securities(2016-01) | 84 | 0 | 0 | 0 | 84 | 0 | |
Other | 771 | 0 | 0 | 0 | 771 | 0 | 0 |
Ending balance at Mar. 31, 2018 | $ 3,712,699 | $ 159,853 | $ 1,741 | $ 1,823,800 | $ 1,859,068 | $ (107,673) | $ (24,089) |
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares |
3 Months Ended | |
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Mar. 31, 2018 |
Mar. 31, 2017 |
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Common Stock | ||
Cash dividends: | ||
Common stock dividends (usd per share) | $ 0.50 | $ 0.33 |
Basis of Presentation |
3 Months Ended |
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Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the financial position, results of operations and comprehensive income, changes in stockholders’ equity, and cash flows of Associated Banc-Corp (individually referred to herein as the “Parent Company,” and together with all of its subsidiaries and affiliates, collectively referred to herein as the “Corporation”) for the periods presented, and all such adjustments are of a normal recurring nature. The consolidated financial statements include the accounts of all subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period. Actual results could differ significantly from those estimates. Estimates that are particularly susceptible to significant change include the determination of the allowance for loan losses, goodwill impairment assessment, mortgage servicing rights valuation, and income taxes. Management has evaluated subsequent events for potential recognition or disclosure. Within the tables presented, certain columns and rows may not sum due to the use of rounded numbers for disclosure purposes. |
Acquisitions |
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Business Combinations [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | Acquisitions Bank Mutual Acquisition On February 1, 2018, the Corporation completed its acquisition of Bank Mutual Corporation ("Bank Mutual") in a stock transaction valued at approximately $482 million. Bank Mutual was a diversified financial services company headquartered in Milwaukee, Wisconsin. The merger resulted in a combined company with a larger market presence in markets the Corporation currently operates in, as well as expansion into nearly a dozen new markets. The merger is also expected to provide significant efficiency opportunities and economies of scale associated with a larger financial institution. Under the terms of the Merger Agreement, Bank Mutual’s shareholders received 0.422 shares of the Corporation's common stock for each share of Bank Mutual common stock. The Corporation issued approximately 19.5 million shares for a total deal value of approximately $482 million based on the closing sale price of a share of Associated common stock on January 31, 2018. The acquisition of Bank Mutual constituted a business combination. The merger has been accounted for using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration exchanged were recorded at estimated fair value on the acquisition date. The determination of estimated fair values required management to make certain estimates that are subjective in nature and may require adjustments upon the availability of new information regarding facts and circumstances which existed at the date of acquisition (i.e. appraisals) for up to a year following the acquisition. The Corporation continues to review information relating to events or circumstances existing at the acquisition date. Management anticipates that this review could result in adjustments to the acquisition date valuation amounts presented herein but does not anticipate that these adjustments would be material. The following table presents the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date related to Bank Mutual.
The Corporation recorded approximately $167 million of goodwill, which is not tax deductible, related to the Bank Mutual acquisition. See Note 8 for additional information on goodwill, as well as the carrying amount and amortization of core deposit and other intangible assets related to the Bank Mutual acquisition. The following is a description of the methods used to determine the fair value of significant assets and liabilities presented on the balance sheet above. Loans: Fair values for loans were based on a discounted cash flow methodology that considered factors including the type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, amortization status and current discount rates. Loans were grouped together according to similar characteristics when applying various valuation techniques. Core deposit intangible ("CDI"): This intangible asset represents the value of the relationships with deposit customers. The fair value was estimated based on a discounted cash flow methodology that gave appropriate consideration to expected customer attrition rates, net maintenance cost of the deposit base, alternative cost of funds, and the interest costs associated with customer deposits. The CDI is being amortized on a straight-line basis over 10 years. Time deposits: The fair values for time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered to the contractual interest rates on such time deposits. Federal Home Loan Bank ("FHLB") borrowings: The fair values of FHLB advances are estimated based on quoted market prices for the instrument if available, or for similar instruments if not available, or by using discounted cash flow analyses, based on current incremental borrowing rates for similar types of instruments. See Note 13 for additional information on fair value measurements. Other Acquisitions During the first quarter of 2018, the Corporation completed the acquisition of Diversified Insurance Solutions ("Diversified"). The acquisition improved Associated Benefits and Risk Consulting's ("ABRC") ability to achieve greater scale in the Metro Milwaukee market and to further expand its Wisconsin employee benefits and property and casualty market position and capabilities. The transaction was valued at approximately $19 million. As a result of the acquisition, the Corporation recorded goodwill of approximately $10 million and other intangibles of approximately $8 million. The other intangibles related to the acquisition are being amortized on a straight-line basis over 10 years. See Note 8 for more information on goodwill and other intangible assets. |
Summary of Significant Accounting Policies |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The accounting and reporting policies of the Corporation conform to U.S. generally accepted accounting principles and to general practice within the financial services industry. A discussion of these policies can be found in Note 1 Summary of Significant Accounting Policies section included in the Corporation’s 2017 Annual Report on Form 10-K. There have been two changes to the Corporation's significant accounting policies since December 31, 2017. Business combinations The Corporation accounts for its acquisitions using the purchase accounting method. Purchase accounting requires the total purchase price to be allocated to the estimated fair values of assets acquired and liabilities assumed, including certain intangible assets that must be recognized. Typically, this allocation results in the purchase price exceeding the fair value of net assets acquired, which is recorded as goodwill. Core deposit intangibles are a measure of the value of checking, money market and savings deposits acquired in business combinations accounted for under the purchase method. Core deposit intangibles and other identified intangibles with finite useful lives are amortized using the straight line method over their estimated useful lives of up to ten years. Loans that the Corporation acquires in connection with acquisitions are recorded at fair value with no carryover of the related allowance for credit losses. Fair value of the loans involves estimating the amount and timing of principal and interest cash flows expected to be collected on the loans and discounting those cash flows at a market rate of interest. The excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loan. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the non-accretable discount. The non-accretable discount includes estimated future credit losses expected to be incurred over the life of the loan. Subsequent decreases to the expected cash flows will require the Corporation to evaluate the need for an additional allowance for credit losses. Subsequent improvement in expected cash flows will result in the reversal of a corresponding amount of the non-accretable discount which the Corporation will then reclassify as accretable discount that will be recognized into interest income over the remaining life of the loan. The Corporation accounts for performing loans acquired in business combinations using the contractual cash flows method of recognizing discount accretion based on the acquired loans’ contractual cash flows. Purchased performing loans are recorded at fair value, including credit, interest, and liquidity discounts. The fair value discount is accreted as an adjustment to yield over the estimated lives of the loans. There is no allowance for loan losses established at the acquisition date for purchased performing loans. A provision for loan losses is recorded for any further deterioration in these loans subsequent to the acquisition. Revenue Recognition The Corporation recognizes revenue in accordance with ASC 606, "Revenue from Contracts with Customers". ASC 606 requires the Corporation to follow a five step process: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation. Revenue recognition under ASC 606 depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for the goods or services. New Accounting Pronouncements Adopted
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Earnings Per Common Share |
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Earnings Per Common Share | Earnings Per Common Share Earnings per common share are calculated utilizing the two-class method. Basic earnings per common share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per common share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding adjusted for the dilutive effect of common stock awards (outstanding stock options and unvested restricted stock awards) and common stock warrants. Presented below are the calculations for basic and diluted earnings per common share.
Non-dilutive common stock options of approximately 1 million and 500,000 for the three months ended March 31, 2018 and 2017, respectively, were excluded from the earnings per common share calculation |
Stock-Based Compensation |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation The fair value of stock options granted is estimated on the date of grant using a Black-Scholes option pricing model, while the fair value of restricted stock awards is their fair market value on the date of grant. The fair values of stock options and restricted stock awards are amortized as compensation expense on a straight-line basis over the vesting period of the grants. For retirement eligible colleagues, expenses related to stock options and restricted stock awards are fully recognized on the date the colleague meets the definition of normal or early retirement. Compensation expense recognized is included in personnel expense in the consolidated statements of income. Assumptions are used in estimating the fair value of stock options granted. The weighted average expected life of the stock option represents the period of time stock options are expected to be outstanding and is estimated using historical data of stock option exercises and forfeitures. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The expected volatility is based on the implied volatility of the Corporation’s stock. The following assumptions were used in estimating the fair value for options granted in the first three months of 2018 and full year 2017.
A summary of the Corporation’s stock option activity for the three months ended March 31, 2018 is presented below.
Intrinsic value represents the amount by which the fair market value of the underlying stock exceeds the exercise price of the stock option. For the three months ended March 31, 2018, the intrinsic value of stock options exercised was approximately $5 million. For the three months ended March 31, 2017, the intrinsic value of the stock options exercised was $10 million. The total fair value of stock options vested was $3 million for the three months ended March 31, 2018 and March 31, 2017. The Corporation recognized compensation expense for the vesting of stock options of $1 million for both the three months ended March 31, 2018 and March 31, 2017. Included in compensation expense for 2018 was approximately $450,000 of expense for the accelerated vesting of stock options granted to retirement eligible colleagues. At March 31, 2018, the Corporation had approximately $8 million of unrecognized compensation expense related to stock options that is expected to be recognized over the remaining requisite service periods that extend through first quarter 2022. The following table summarizes information about the Corporation’s restricted stock activity for the three months ended March 31, 2018.
The Corporation amortizes the expense related to restricted stock awards as compensation expense over the vesting period specified in the grant's award agreement. Performance-based restricted stock awards granted during 2017 and 2018 will vest ratably over a three year period, while service-based restricted stock awards granted during 2017 and 2018 will vest ratably over a four year period. Expense for restricted stock awards of approximately $3 million was recorded the three months ended March 31, 2018 and $7 million was recorded for the three months ended March 31, 2017. Included in compensation expense for 2018 was approximately $1 million of expense for the accelerated vesting of restricted stock awards granted to retirement eligible colleagues. The Corporation had $29 million of unrecognized compensation costs related to restricted stock awards at March 31, 2018, that is expected to be recognized over the remaining requisite service periods that extend through first quarter 2022. The Corporation has the ability to issue shares from treasury or new shares upon the exercise of stock options or the granting of restricted stock awards. The Board of Directors has authorized management to repurchase shares of the Corporation’s common stock in the market, to be made available for issuance in connection with the Corporation’s employee incentive plans and for other corporate purposes. The repurchase of shares will be based on market and investment opportunities, capital levels, growth prospects, and regulatory constraints. Such repurchases may occur from time to time in open market purchases, block transactions, private transactions, accelerated share repurchase programs, or similar facilities. |
Investment Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment Securities | Investment Securities Investment securities are generally classified as available for sale or held to maturity at the time of purchase. The majority of the Corporation's investment securities are mortgage-related securities issued by the Government National Mortgage Association (“GNMA”) or government-sponsored enterprises ("GSE") such as the Federal National Mortgage Association (“FNMA”) and the Federal Home Loan Mortgage Corporation (“FHLMC”). A portion of the portfolio is also comprised of asset-backed securities backed by student loans made under the Federal Family Education Loan Program ("FFELP"). The amortized cost and fair values of securities available for sale and held to maturity were as follows.
The expected maturities of investment securities available for sale and held to maturity at March 31, 2018, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
Investment securities with a carrying value of approximately $3.0 billion and $3.1 billion at March 31, 2018, and December 31, 2017, respectively, were pledged to secure certain deposits or for other purposes as required or permitted by law. On the acquisition date, the Corporation sold Bank Mutual's entire securities portfolio. The following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position, at March 31, 2018.
For comparative purposes, the following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2017.
The Corporation reviews the investment securities portfolio on a quarterly basis to monitor its exposure to other-than-temporary impairment. A determination as to whether a security’s decline in fair value is other-than-temporary takes into consideration numerous factors and the relative significance of any single factor can vary by security. Some factors the Corporation may consider in the other-than-temporary impairment analysis include the length of time and extent to which the security has been in an unrealized loss position, changes in security ratings, financial condition and near-term prospects of the issuer, as well as security and industry specific economic conditions. Based on the Corporation’s evaluation, management does not believe any unrealized loss at March 31, 2018 represents an other-than-temporary impairment as these unrealized losses are primarily attributable to changes in interest rates and the current market conditions, and not credit deterioration. The unrealized losses reported for municipal securities relate to various state and local political subdivisions and school districts. The unrealized losses at March 31, 2018 for mortgage-related securities is due to the increase in overall interest rates. The U.S. Treasury 3 year and 5 year rates increased by 41 bp and 36 bp, respectively, from December 31, 2017. The Corporation does not intend to sell nor does it believe that it will be required to sell the securities contained in the above unrealized losses table before recovery of their amortized cost basis. Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank stocks: The Corporation is required to maintain Federal Reserve stock and FHLB stock as a member of both the Federal Reserve System and the FHLB, and in amounts as required by these institutions. These equity securities are “restricted” in that they can only be sold back to the respective institutions or another member institution at par. Therefore, they are less liquid than other marketable equity securities and their fair value is equal to amortized cost. At March 31, 2018, and December 31, 2017, the Corporation had FHLB stock of $157 million and $89 million, respectively. The Corporation had Federal Reserve Bank stock of $76 million at both March 31, 2018 and December 31, 2017. |
Loans |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans | Loans The period end loan composition was as follows.
The following table presents commercial and consumer loans by credit quality indicator at March 31, 2018.
The following table presents commercial and consumer loans by credit quality indicator at December 31, 2017.
Factors that are important to managing overall credit quality are sound loan underwriting and administration, systematic monitoring of existing loans and commitments, effective loan review on an ongoing basis, early identification of potential problems, and appropriate allowance for loan losses, allowance for unfunded commitments, nonaccrual, and charge off policies. For commercial loans, management has determined the pass credit quality indicator to include credits that exhibit acceptable financial statements, cash flow, and leverage. If any risk exists, it is mitigated by the loan structure, collateral, monitoring, or control. For consumer loans, performing loans include credits that are performing in accordance with the original contractual terms. Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Special mention credits have potential weaknesses that deserve management’s attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the credit. Potential problem loans are considered inadequately protected by the current net worth and paying capacity of the obligor or the collateral pledged. These loans generally have a well-defined weakness, or weaknesses, that may jeopardize liquidation of the debt and are characterized by the distinct possibility that the Corporation will sustain some loss if the deficiencies are not corrected. Lastly, management considers a loan to be impaired when it is probable that the Corporation will be unable to collect all amounts due according to the original contractual terms of the note agreement, including both principal and interest. Management has determined that commercial and consumer loan relationships that have nonaccrual status or have had their terms restructured in a troubled debt restructuring meet this impaired loan definition. Commercial loans classified as special mention, potential problem, and nonaccrual are reviewed at a minimum on a quarterly basis, while pass and performing rated credits are reviewed on an annual basis or more frequently if the loan renewal is less than one year or if otherwise warranted. The following table presents loans by past due status at March 31, 2018.
The following table presents loans by past due status at December 31, 2017.
The following table presents impaired loans individually evaluated under ASC Topic 310, excluding purchased credit-impaired loans, at March 31, 2018.
The following table presents impaired loans individually evaluated under ASC Topic 310 at December 31, 2017.
Troubled Debt Restructurings (“Restructured Loans”) Loans are considered restructured loans if concessions have been granted to borrowers that are experiencing financial difficulty. The Corporation had a recorded investment of approximately $4 million in loans modified in troubled debt restructurings for the three months ended March 31, 2018, of which approximately $1 million were in accrual status and $3 million were in nonaccrual pending a sustained period of repayment. The following table presents nonaccrual and performing restructured loans by loan portfolio.
The following table provides the number of loans modified in a troubled debt restructuring by loan portfolio during the three months ended March 31, 2018 and 2017, respectively, and the recorded investment and unpaid principal balance as of March 31, 2018 and 2017, respectively.
Restructured loan modifications may include payment schedule modifications, interest rate concessions, maturity date extensions, modification of note structure (A/B Note), non-reaffirmed Chapter 7 bankruptcies, principal reduction, or some combination of these concessions. During the three months ended March 31, 2018, restructured loan modifications of commercial and industrial, commercial real estate, and real estate construction loans primarily included maturity date extensions and payment schedule modifications. Restructured loan modifications of home equity and residential mortgage loans primarily included maturity date extensions, interest rate concessions, non-reaffirmed Chapter 7 bankruptcies, or a combination of these concessions for the three months ended March 31, 2018. The following table provides the number of loans modified in a troubled debt restructuring during the previous twelve months which subsequently defaulted during the three months ended March 31, 2018 and 2017, respectively, as well as the recorded investment in these restructured loans as of March 31, 2018 and 2017, respectively.
All loans modified in a troubled debt restructuring are evaluated for impairment. The nature and extent of the impairment of restructured loans, including those which have experienced a subsequent payment default, is considered in the determination of an appropriate level of the allowance for loan losses. Allowance for Credit Losses The allowance for credit losses is comprised of the allowance for loan losses and the allowance for unfunded commitments. The level of the allowance for loan losses represents management’s estimate of an amount appropriate to provide for probable credit losses in the loan portfolio at the balance sheet date. The allowance for unfunded commitments is maintained at a level believed by management to be sufficient to absorb estimated probable losses related to unfunded credit facilities (including unfunded loan commitments and letters of credit) and is included in accrued expenses and other liabilities on the consolidated balance sheets. See Note 12 for additional information on the allowance for unfunded commitments. The following table presents a summary of the changes in the allowance for loan losses by portfolio segment for the three months ended March 31, 2018.
For comparison purposes, a summary of the changes in the allowance for loan losses by portfolio segment for the year ended December 31, 2017, was as follows.
The allowance related to the oil and gas portfolio was $19 million at March 31, 2018 and represented 3% of total oil and gas loans.
The following table presents a summary of the changes in the allowance for unfunded commitments.
Loans Acquired in Acquisition Loans acquired in a business combination are recorded at estimated fair value on their purchase date without a carryover of the related allowance for loan and lease losses. Acquired loans are segregated into two types:
For performing loans the difference between the estimated fair value of the loans and the principal outstanding is accreted over the remaining life of the loans. In accordance with ASC 310-30, purchased credit-impaired loans are pooled by loan type and the difference between contractually required payments at acquisition and the cash flows expected to be collected is referred to as the non-accretable difference. Further, any excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable yield and is recognized into interest income over the remaining life of the loan pools when there is a reasonable expectation about the amount and timing of such cash flows. Changes in the accretable yield for loans acquired and accounted for under ASC Topic 310-30 were as follows for the three months ended March 31, 2018 and for the year ended December 31, 2017
For loans acquired, the fair value of purchased credit-impaired loans, on the acquisition date, was determined based on assigned risk ratings, expected cash flows and the fair value of loan collateral. The fair value of loans that were non-impaired was determined based on estimates of losses on defaults and other market factors. |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets | Goodwill and Other Intangible Assets Goodwill Goodwill is not amortized but, instead, is subject to impairment tests on at least an annual basis, and more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Corporation conducted its most recent annual impairment testing in May 2017, utilizing a qualitative assessment. Factors that management considered in this assessment included macroeconomic conditions, industry and market considerations, overall financial performance of the Corporation and each reporting unit (both current and projected), changes in management strategy, and changes in the composition or carrying amount of net assets. In addition, management considered the changes in both the Corporation’s common stock price and in the overall bank common stock index (based on the S&P 400 Regional Bank Sub-Industry Index), as well as the Corporation’s earnings per common share trend over the past year. Based on these assessments, management concluded that the 2017 annual qualitative impairment assessment indicated that it is more likely than not that the estimated fair value exceeded the carrying value (including goodwill) for each reporting unit. Therefore, a step one quantitative analysis was not required. There have been no events since the May 2017 impairment testing that have changed the Corporation's impairment assessment conclusion. There were no impairment charges recorded in 2017 or the first three months of 2018. At March 31, 2018, the Corporation had goodwill of $1.2 billion, compared to $976 million at December 31, 2017. Goodwill increased $167 million related to the Bank Mutual acquisition and $10 million related to the acquisition of Diversified Insurance Solutions. See Note 2 for additional information on the Corporation's acquisitions. Other Intangible Assets The Corporation has other intangible assets that are amortized, consisting of core deposit intangibles, other intangibles (primarily related to customer relationships acquired in connection with the Corporation’s insurance agency acquisitions), and mortgage servicing rights. During the first quarter of 2018, the Corporation added approximately $58 million of core deposit intangibles as a result of the Bank Mutual acquisition. In addition, the Corporation added approximately $8 million of other intangibles relating to customer relationships associated with the Diversified acquisition. See Note 2 for additional information on the Corporation's acquisitions. For core deposit intangibles and other intangibles, changes in the gross carrying amount, accumulated amortization, and net book value were as follows.
The Corporation sells residential mortgage loans in the secondary market and typically retains the right to service the loans sold. Mortgage servicing rights are amortized in proportion to and over the period of estimated net servicing income and assessed for impairment at each reporting date. The Corporation evaluates its mortgage servicing rights asset for impairment at minimum on a quarterly basis. Impairment is assessed based on fair value at each reporting date using estimated prepayment speeds of the underlying mortgage loans serviced and stratifications based on the risk characteristics of the underlying loans (predominantly loan type and note interest rate). As mortgage interest rates fall, prepayment speeds are usually faster and the value of the mortgage servicing rights asset generally decreases, requiring additional valuation reserve. Conversely, as mortgage interest rates rise, prepayment speeds are usually slower and the value of the mortgage servicing rights asset generally increases, requiring less valuation reserve. A valuation allowance is established, through a charge to earnings, to the extent the amortized cost of the mortgage servicing rights exceeds the estimated fair value by stratification. If it is later determined that all or a portion of the temporary impairment no longer exists for a stratification, the valuation is reduced through a recovery to earnings. An other-than-temporary impairment (i.e., recoverability is considered remote when considering interest rates and loan pay off activity) is recognized as a write-down of the mortgage servicing rights asset and the related valuation allowance (to the extent a valuation allowance is available) and then against earnings. A direct write-down permanently reduces the carrying value of the mortgage servicing rights asset and valuation allowance, precluding subsequent recoveries. See Note 12 for a discussion of the recourse provisions on sold residential mortgage loans. See Note 13 which further discusses fair value measurement relative to the mortgage servicing rights asset. A summary of changes in the balance of the mortgage servicing rights asset and the mortgage servicing rights valuation allowance was as follows.
The following table shows the estimated future amortization expense for amortizing intangible assets. The projections of amortization expense are based on existing asset balances, the current interest rate environment, and prepayment speeds as of March 31, 2018. The actual amortization expense the Corporation recognizes in any given period may be significantly different depending upon acquisition or sale activities, changes in interest rates, prepayment speeds, market conditions, regulatory requirements, and events or circumstances that indicate the carrying amount of an asset may not be recoverable.
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Short and Long-Term Funding |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Short and Long-Term Funding | Short and Long-Term Funding The following table presents the components of short-term funding (funding with original contractual maturities of one year or less) and long-term funding (funding with original contractual maturities greater than one year).
Securities Sold Under Agreements to Repurchase ("Repurchase Agreements") The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Corporation may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Corporation to repurchase the assets. The obligation to repurchase the securities is reflected as a liability on the Corporation’s consolidated balance sheets, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts (i.e., there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities). See Note 11 for additional disclosures on balance sheet offsetting. The Corporation utilizes securities sold under agreements to repurchase to facilitate the needs of its customers. As of March 31, 2018, the Corporation pledged agency mortgage-related securities with a fair value of $288 million as collateral for the repurchase agreements. Securities pledged as collateral under repurchase agreements are maintained with the Corporation's safekeeping agents and are monitored on a daily basis due to the market risk of fair value changes in the underlying securities. The Corporation generally pledges excess securities to ensure there is sufficient collateral to satisfy short-term fluctuations in both the repurchase agreement balances and the fair value of the underlying securities. The remaining contractual maturity of the securities sold under agreements to repurchase in the consolidated balance sheets as of March 31, 2018 and December 31, 2017 are presented in the following table.
Long-Term Funding FHLB advances: At March 31, 2018, the long-term FHLB advances had maturity or call dates primarily ranging from 2018 through 2019, and had a weighted average interest rate of 1.50%, compared to 1.26% at December 31, 2017. The majority of FHLB advances are indexed to the FHLB discount note and re-price at varying intervals. The advances offer flexible, low cost, long-term funding that improves the Corporation’s liquidity profile. Senior notes: In November 2014, the Corporation issued $250 million of senior notes, due November 2019, and callable October 2019. The senior notes have a fixed coupon interest rate of 2.75% and were issued at a discount. Subordinated notes: In November 2014, the Corporation issued $250 million of 10-year subordinated notes, due January 2025, and callable October 2024. The subordinated notes have a fixed coupon interest rate of 4.25% and were issued at a discount. |
Derivative and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative and Hedging Activities | Derivative and Hedging Activities The Corporation is exposed to certain risk arising from both its business operations and economic conditions. The Corporation principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Corporation enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Corporation's derivative financial instruments are used to manage differences in the amount, timing, and duration of the Corporation's known or expected cash receipts and its known or expected cash payments principally related to the Corporation's assets. The contract or notional amount of a derivative is used to determine, along with the other terms of the derivative, the amounts to be exchanged between the counterparties. The Corporation is exposed to credit risk in the event of nonperformance by counterparties to financial instruments. To mitigate the counterparty risk, interest rate and commodity-related instruments generally contain language outlining collateral pledging requirements for each counterparty. Collateral must be posted when the market value exceeds certain mutually agreed upon threshold limits. The Corporation pledged $28 million of investment securities as collateral at March 31, 2018, and pledged $24 million of investment securities as collateral at December 31, 2017. Federal regulations require the Corporation to clear all LIBOR interest rate swaps through a clearing house if it can be cleared. As such, the Corporation is required to pledge cash collateral for the margin. At March 31, 2018 the Corporation posted $29 million of cash collateral for the margin compared to $22 million at December 31, 2017. Fair Value Hedges of Interest Rate Risk The Corporation is exposed to changes in the fair value of certain of its pools of prepayable fixed-rate assets due to changes in benchmark interest rates. The Corporation uses interest rate swaps to manage its exposure to changes in fair value on these instruments attributable to changes in the designated benchmark interest rate. Interest rate swaps designated as fair value hedges involve the payment of fixed-rate amounts to a counterparty in exchange for the Corporation receiving variable-rate payments over the life of the agreements without the exchange of the underlying notional amount. For derivatives designated and that qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in interest income. Derivatives to Accommodate Customer Needs The Corporation also facilitates customer borrowing activity by entering into various derivative contracts which are designated as free standing derivative contracts. Free standing derivative products are entered into primarily for the benefit of commercial customers seeking to manage their exposures to interest rate risk, foreign currency, and commodity prices. These derivative contracts are not designated against specific assets and liabilities on the balance sheet or forecasted transactions and, therefore, do not qualify for hedge accounting treatment. Such derivative contracts are carried at fair value on the consolidated balance sheets with changes in the fair value recorded as a component of Capital market fees, net, and typically include interest rate-related instruments (swaps and caps), foreign currency exchange forwards, and commodity contracts. See Note 11 for additional information and disclosures on balance sheet offsetting. Interest rate-related instruments: The Corporation provides interest rate risk management services to commercial customers, primarily forward interest rate swaps and caps. The Corporation’s market risk from unfavorable movements in interest rates related to these derivative contracts is generally economically hedged by concurrently entering into offsetting derivative contracts. The offsetting derivative contracts have identical notional values, terms and indices. Foreign currency exchange forwards: The Corporation provides foreign currency exchange services to customers, primarily forward contracts. Our customers enter into a foreign currency exchange forward with the Corporation as a means for them to mitigate exchange rate risk. The Corporation mitigates its risk by then entering into an offsetting foreign currency exchange derivative contract. Commodity contracts: Commodity contracts are entered into primarily for the benefit of commercial customers seeking to manage their exposure to fluctuating commodity prices. The Corporation mitigates its risk by then entering into an offsetting commodity derivative contract. Mortgage Derivatives Interest rate lock commitments to originate residential mortgage loans held for sale and forward commitments to sell residential mortgage loans are considered derivative instruments, and the fair value of these commitments is recorded on the consolidated balance sheets with the changes in fair value recorded as a component of mortgage banking, net. Written and Purchased Options (Time Deposit) Historically, the Corporation had entered into written and purchased option derivative instruments to facilitate an equity linked time deposit product (the “Power CD”), which the Corporation ceased offering in September 2013. The Power CD was a time deposit that provided the purchaser a guaranteed return of principal at maturity plus a potential equity return (a written option), while the Corporation received a known stream of funds based on the equity return (a purchased option). The written and purchased options are mirror derivative instruments, which are carried at fair value on the consolidated balance sheets. The table below identifies the balance sheet category and fair values of the Corporation’s derivative instruments.
The following table presents amounts that were recorded on the balance sheet related to cumulative basis adjustment for fair value hedges.
The table below identifies the effect of fair value hedge accounting on the Corporation's statement of performance during the three months ended March 31, 2018.
The table below identifies the effect of derivatives not designated as hedging instruments on the Corporation's statement of performance during the three months ended March 31, 2018.
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Balance Sheet Offsetting |
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Offsetting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Corporation recognizes revenue in accordance with ASC 606, "Revenue from Contracts with Customers". ASC 606 requires the Corporation to follow a five step process: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation. Revenue recognition under ASC 606 depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for the goods or services. |
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Balance Sheet Offsetting | Balance Sheet Offsetting Interest Rate-Related Instruments and Commodity Contracts (“Interest and Commodity Agreements”) The Corporation enters into interest rate-related instruments to facilitate the interest rate risk management strategies of commercial customers. The Corporation also enters into commodity contracts to manage commercial customers' exposure to fluctuating commodity prices. The Corporation mitigates these risks by entering into equal and offsetting interest and commodity agreements with highly rated third party financial institutions. The Corporation is party to master netting arrangements with its financial institution counterparties that creates a single net settlement of all legal claims or obligations to pay or receive the net amount of settlement of the individual interest and commodity agreements. Collateral, usually in the form of investment securities and cash, is posted by the counterparty with net liability positions in accordance with contract thresholds. The Corporation does not offset assets and liabilities under these arrangements for financial statement presentation purposes. See Note 10 for additional information on the Corporation’s derivative and hedging activities. Securities Sold Under Agreements to Repurchase (“Repurchase Agreements”) The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. These repurchase agreements are accounted for as collateralized financing arrangements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities (i.e., there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities). The right of set-off for a repurchase agreement resembles a secured borrowing, whereby the collateral would be used to settle the fair value of the repurchase agreement should the Corporation be in default (e.g., fails to make an interest payment to the counterparty). In addition, the Corporation does not enter into reverse repurchase agreements; therefore, there is no such offsetting to be done with the repurchase agreements. See Note 9 for additional disclosures on repurchase agreements. The following table presents the assets and liabilities subject to an enforceable master netting arrangement. The interest and commodity agreements we have with our commercial customers are not subject to an enforceable master netting arrangement, and therefore, are excluded from this table.
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Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters |
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Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments, Off-Balance Sheet Arrangements, and Legal Proceedings | Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters The Corporation utilizes a variety of financial instruments in the normal course of business to meet the financial needs of its customers and to manage its own exposure to fluctuations in interest rates. These financial instruments include lending-related and other commitments (see below) as well as derivative instruments (see Note 10). The following is a summary of lending-related commitments.
Lending-related Commitments As a financial services provider, the Corporation routinely enters into commitments to extend credit. Such commitments are subject to the same credit policies and approval process accorded to loans made by the Corporation, with each customer’s creditworthiness evaluated on a case-by-case basis. The commitments generally have fixed expiration dates or other termination clauses and may require the payment of a fee. The Corporation’s exposure to credit loss in the event of nonperformance by the other party to these financial instruments is represented by the contractual amount of those instruments. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the customer. Since a significant portion of commitments to extend credit are subject to specific restrictive loan covenants or may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash flow requirements. An allowance for unfunded commitments is maintained at a level believed by management to be sufficient to absorb estimated probable losses related to unfunded commitments (including unfunded loan commitments and letters of credit). The allowance for unfunded commitments totaled $26 million at March 31, 2018 and $24 million at December 31, 2017, and is included in accrued expenses and other liabilities on the consolidated balance sheets. Lending-related commitments include commitments to extend credit, commitments to originate residential mortgage loans held for sale, commercial letters of credit, and standby letters of credit. Commitments to extend credit are legally binding agreements to lend to customers at predetermined interest rates, as long as there is no violation of any condition established in the contracts. Interest rate lock commitments to originate residential mortgage loans held for sale and forward commitments to sell residential mortgage loans are considered derivative instruments, and the fair value of these commitments is recorded on the consolidated balance sheets. The Corporation’s derivative and hedging activity is further described in Note 10. Commercial and standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. Commercial letters of credit are issued specifically to facilitate commerce and typically result in the commitment being drawn on when the underlying transaction is consummated between the customer and the third party, while standby letters of credit generally are contingent upon the failure of the customer to perform according to the terms of the underlying contract with the third party. Other Commitments The Corporation invests in unconsolidated projects including low-income housing, new market tax credit projects, and historic tax credit projects to promote the revitalization of primarily low-to-moderate-income neighborhoods throughout the local communities of its bank subsidiary. As a limited partner in these unconsolidated projects, the Corporation is allocated tax credits and deductions associated with the underlying projects. The aggregate carrying value of these investments at March 31, 2018 was $142 million, compared to $147 million at December 31, 2017. The Corporation has principal investment commitments to provide capital-based financing to private and public companies through either direct investments in specific companies or through investment funds and partnerships. The timing of future cash requirements to fund such commitments is generally dependent on the investment cycle, whereby privately held companies are funded by private equity investors and ultimately sold, merged, or taken public through an initial offering, which can vary based on overall market conditions, as well as the nature and type of industry in which the companies operate. The aggregate carrying value of these investments at March 31, 2018 was $24 million, compared to $23 million at December 31, 2017, included in other assets on the consolidated balance sheets. Related to these investments, the Corporation had remaining commitments to fund $111 million at March 31, 2018, and $119 million at December 31, 2017. Legal Proceedings The Corporation is party to various pending and threatened claims and legal proceedings arising in the normal course of business activities, some of which involve claims for substantial amounts. Although there can be no assurance as to the ultimate outcomes, the Corporation believes it has meritorious defenses to the claims asserted against it in its currently outstanding matters, including the matters described below, and with respect to such legal proceedings, intends to continue to defend itself vigorously. The Corporation will consider settlement of cases when, in management’s judgment, it is in the best interests of both the Corporation and its shareholders. On at least a quarterly basis, the Corporation assesses its liabilities and contingencies in connection with all pending or threatened claims and litigation, utilizing the most recent information available. On a matter by matter basis, an accrual for loss is established for those matters which the Corporation believes it is probable that a loss may be incurred and that the amount of such loss can be reasonably estimated. Once established, each accrual is adjusted as appropriate to reflect any subsequent developments. Accordingly, management’s estimate will change from time to time, and actual losses may be more or less than the current estimate. For matters where a loss is not probable, or the amount of the loss cannot be estimated, no accrual is established. Resolution of legal claims is inherently unpredictable, and in many legal proceedings various factors exacerbate this inherent unpredictability, including where the damages sought are unsubstantiated or indeterminate, it is unclear whether a case brought as a class action will be allowed to proceed on that basis, discovery is not complete, the proceeding is not yet in its final stages, the matters present legal uncertainties, there are significant facts in dispute, there are a large number of parties (including where it is uncertain how liability, if any, will be shared among multiple defendants), or there is a wide range of potential results. A lawsuit, R.J. ZAYED v. Associated Bank, N.A., was filed in the United States District Court for the District of Minnesota on January 29, 2013. The lawsuit relates to a Ponzi scheme perpetrated by Oxford Global Partners and related entities (“Oxford”) and individuals and was brought by the receiver for Oxford. Oxford was a depository customer of Associated Bank (the "Bank"). The lawsuit claims that the Bank is liable for failing to uncover the Oxford Ponzi scheme, and specifically alleges the Bank aided and abetted (1) the fraudulent scheme; (2) a breach of fiduciary duty; (3) conversion; and (4) false representations and omissions. The lawsuit seeks unspecified consequential and punitive damages. The District Court granted the Bank’s motion to dismiss the complaint on September 30, 2013. On March 2, 2015, the U.S. Court of Appeals for the Eighth Circuit reversed the District Court and remanded the case back to the District Court for further proceedings. On January 31, 2017, the District Court granted the Bank’s motion for summary judgment. The receiver has appealed the District Court’s summary judgment decision to the Eighth Circuit Court of Appeals. On January 23, 2018, the District Court approved a settlement agreement between the parties. Based on the terms of the settlement agreement, the Bank expects that the litigation will not have a material adverse impact on the Bank regardless of the outcome of the appeal to the Eighth Circuit Court of Appeals. A lawsuit by investors in the same Ponzi scheme, Herman Grad, et al v. Associated Bank, N.A., brought in Brown County, Wisconsin in October 2009 was dismissed by the circuit court, and the dismissal was affirmed by the Wisconsin Court of Appeals in June 2011 in an unpublished opinion. Two complaints were filed against the Bank on January 11, 2016 in the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division in connection with the In re: World Marketing Chicago, LLC, et al Chapter 11 bankruptcy proceeding. In the first complaint, The Official Committee of Unsecured Creditors of World Marketing Chicago, LLC, et al v. Associated Bank, N.A., the plaintiff seeks to avoid guarantees and pledges of collateral given by the debtors to secure a revolving financing commitment of $6 million to the debtors’ parent company from the Bank. The plaintiff alleges a variety of legal theories under federal and state law, including fraudulent conveyance, preferential transfer and conversion, in support of its position. The plaintiff seeks return of approximately $4 million paid to the Bank and the avoidance of the security interest in the collateral securing the remaining indebtedness to the Bank. In the second complaint, American Funds Service Company v. Associated Bank, N.A., the plaintiff alleges that approximately $600,000 of funds it had advanced to the World Marketing entities to apply towards future postage fees was swept by the Bank from World Marketing’s bank accounts. Plaintiff seeks the return of such funds from the Bank under several theories, including Sec. 541(d) of the Bankruptcy Code, the creation of a resulting trust, and unjust enrichment. On February 7, 2018, both cases were settled, and the Bank received approximately $540,000 from the proceeds of the liquidation of its collateral. Both cases were dismissed on February 16, 2018. Subsequent to the announcement on July 20, 2017, of the Merger Agreement between the Corporation and Bank Mutual, several lawsuits were filed in connection with the proposed merger. On July 28, 2017, two substantially identical purported class action complaints, each by various individual plaintiffs, were filed with the Wisconsin Circuit Court for Milwaukee County on behalf of the respective named plaintiffs and other Bank Mutual shareholders against Bank Mutual, the members of the Bank Mutual board, and the Corporation. The lawsuits are captioned Schumel et al v. Bank Mutual Corporation et al. and Paquin et al. v. Bank Mutual Corporation et al. Both complaints allege state law breach of fiduciary duty claims against the Bank Mutual board for, among other things, seeking to sell Bank Mutual through an allegedly defective process, for an allegedly unfair price and on allegedly unfair terms. On August 30, 2017, a third purported class action complaint, captioned Wollenburg et al. v. Bank Mutual Corporation et al., was filed in the Wisconsin Circuit Court for Milwaukee County, on behalf of the same class of shareholders and against the same defendants as the prior two complaints. The Wollenburg complaint asserts similar allegations as the prior two complaints, and further alleges that the preliminary proxy statement/prospectus filed with the SEC contains various alleged misstatements or omissions under federal securities law. The Paquin, Schumel and Wollenburg complaints allege that the Corporation aided and abetted Bank Mutual's directors' alleged breaches of fiduciary duty. The parties have entered into a stipulation seeking to consolidate the three actions. On September 13, 2017, the Corporation filed a notice of removal of the Paquin, Schumel and Wollenburg actions to the United States District Court for the Eastern District of Wisconsin. On September 15, 2017, the plaintiffs in the Paquin, Schumel and Wollenburg actions filed identical motions to remand the three cases back to state court, and on September 27, 2017, the defendants filed oppositions to the motions to remand. On October 3, 2017, the defendants filed motions to dismiss the three actions. On September 6, 2017, a fourth purported class action complaint, captioned Parshall et al., v. Bank Mutual Corporation et al., was filed in the U.S. District Court for the Eastern District of Wisconsin, on behalf of the same class of shareholders and against the same defendants as the prior complaints. The Parshall complaint criticizes the adequacy of the merger consideration and alleges that Bank Mutual, the members of the Bank Mutual board and the Corporation allegedly omitted and/or misrepresented certain information in the registration statement on Form S-4 filed in connection with the proposed merger in violation of the federal securities laws. The lawsuits seek, among other things, to enjoin the consummation of the transaction and damages. The Corporation believes the allegations are without merit. On October 13, 2017, Bank Mutual and the Corporation reached agreement with the plaintiffs in each of the four cases whereby Bank Mutual issued certain additional disclosures in a Form 8-K, and each of the plaintiffs have agreed to dismiss their actions with prejudice as to the named plaintiffs and without prejudice as to the rest of the purported class members. Regulatory Matters On May 22, 2015, the Bank entered into a Conciliation Agreement ("Conciliation Agreement") with the U.S. Department of Housing and Urban Development ("HUD") which resolved the HUD investigation into the Bank's lending practices during the years 2008-2010. The Bank's commitments under the Conciliation Agreement are spread over 3 years and include commitments to do the following in minority communities: make mortgage loans of approximately $196 million; open one branch and four loan production offices; establish special financing programs; make affordable home repair grants; engage in affirmative marketing outreach; provide financial education programs; and make grants to support community reinvestment training and education. The cost of these commitments will be spread over four calendar years and is not expected to have a material impact on the Corporation's financial condition or results of operation. A variety of consumer products, including mortgage and deposit products, and certain fees and charges related to such products, have come under increased regulatory scrutiny. It is possible that regulatory authorities could bring enforcement actions, including civil money penalties, or take other actions against the Corporation and the Bank in regard to these consumer products. The Bank could also determine of its own accord, or be required by regulators, to refund or otherwise make remediation payments to customers in connection with these products. It is not possible at this time for management to assess the probability of a material adverse outcome or reasonably estimate the amount of any potential loss related to such matters. Mortgage Repurchase Reserve The Corporation sells residential mortgage loans to investors in the normal course of business. Residential mortgage loans sold to others are predominantly conventional residential first lien mortgages originated under our usual underwriting procedures, and are most often sold on a nonrecourse basis, primarily to the GSEs. The Corporation’s agreements to sell residential mortgage loans in the normal course of business usually require certain representations and warranties on the underlying loans sold, related to credit information, loan documentation, collateral, and insurability. Subsequent to being sold, if a material underwriting deficiency or documentation defect is discovered, the Corporation may be obligated to repurchase the loan or reimburse the GSEs for losses incurred (collectively, “make whole requests”). The make whole requests and any related risk of loss under the representations and warranties are largely driven by borrower performance. As a result of make whole requests, the Corporation has repurchased loans with principal balances of approximately $394 thousand and $1 million during the three months ended March 31, 2018 and the year ended December 31, 2017, respectively. The loss reimbursement and settlement claims paid for the three months ended March 31, 2018 were zero and negligible for the year ended December 31, 2017. Make whole requests during 2017 and the first three months of 2018 generally arose from loans sold during the period of January 1, 2012 to December 31, 2017, which totaled $10.0 billion at the time of sale, and consisted primarily of loans sold to GSEs. As of March 31, 2018, approximately $6.0 billion of these sold loans remain outstanding. The balance in the mortgage repurchase reserve at the balance sheet date reflects the estimated amount of potential loss the Corporation could incur from repurchasing a loan, as well as loss reimbursements, indemnifications, and other settlement resolutions. The following summarizes the changes in the mortgage repurchase reserve.
The Corporation may also sell residential mortgage loans with limited recourse (limited in that the recourse period ends prior to the loan’s maturity, usually after certain time and / or loan paydown criteria have been met), whereby repurchase could be required if the loan had defined delinquency issues during the limited recourse periods. At March 31, 2018, and December 31, 2017, there were approximately $36 million and $44 million, respectively, of residential mortgage loans sold with such recourse risk. There have been limited instances and immaterial historical losses on repurchases for recourse under the limited recourse criteria. The Corporation has a subordinate position to the FHLB in the credit risk on residential mortgage loans it sold to the FHLB in exchange for a monthly credit enhancement fee. The Corporation has not sold loans to the FHLB with such credit risk retention since February 2005. At March 31, 2018 and December 31, 2017, there were $69 million and $73 million, respectively, of such residential mortgage loans with credit risk recourse, upon which there have been negligible historical losses to the Corporation. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements Fair value represents the estimated price at which an orderly transaction to sell an asset or to transfer a liability would take place between market participants at the measurement date under current market conditions (i.e., an exit price concept). Following is a description of the valuation methodologies used for the Corporation’s more significant instruments measured on a recurring basis at fair value, including the general classification of such instruments pursuant to the valuation hierarchy. Assets and Liabilities Measured at Fair Value on a Recurring Basis Investment Securities Available for Sale: Where quoted prices are available in an active market, investment securities are classified in Level 1 of the fair value hierarchy. If quoted market prices are not available for the specific security, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flows, with consideration given to the nature of the quote and the relationship of recently evidenced market activity to the fair value estimate, and are classified in Level 2 of the fair value hierarchy. Lastly, in certain cases where there is limited activity or less transparency around inputs to the estimated fair value, securities are classified within Level 3 of the fair value hierarchy. To validate the fair value estimates, assumptions, and controls, the Corporation looks to transactions for similar instruments and utilizes independent pricing provided by third party vendors or brokers and relevant market indices. While none of these sources are solely indicative of fair value, they serve as directional indicators for the appropriateness of the Corporation’s fair value estimates. The Corporation has determined that the fair value measures of its investment securities are classified predominantly within Level 1 or 2 of the fair value hierarchy. See Note 6 for additional disclosure regarding the Corporation’s investment securities. Residential Loans Held for Sale: Loans held for sale, which consist generally of current production of certain fixed-rate, first-lien residential mortgage loans, are carried at estimated fair value. Management has elected the fair value option to account for all newly originated mortgage loans held for sale which results in the financial impact of changing market conditions being reflected currently in earnings as opposed to being dependent upon the timing of sales. Therefore, the continually adjusted values better reflect the price the Corporation expects to receive from the sale of such loans. The estimated fair value was based on what secondary markets are currently offering for portfolios with similar characteristics, which the Corporation classifies as a Level 2 fair value measurement. Derivative Financial Instruments (Interest Rate-Related Instruments): The Corporation utilizes interest rate swaps to hedge exposure to interest rate risk and variability of fair value associated to changes in the underlying interest rate of the hedged item. These hedged interest rate swaps are classified as fair value hedges. See Note 10 for additional disclosure regarding the Corporation’s fair value hedges. In addition, the Corporation offers interest rate-related instruments (swaps and caps) to service our customers’ needs, for which the Corporation simultaneously enters into offsetting derivative financial instruments (i.e., mirror interest rate-related instruments) with third parties to manage its interest rate risk associated with these financial instruments. The valuation of the Corporation’s derivative financial instruments is determined using discounted cash flow analysis on the expected cash flows of each derivative and also includes a nonperformance / credit risk component (credit valuation adjustment). See Note 10 for additional disclosure regarding the Corporation’s interest rate-related instruments. The discounted cash flow analysis component in the fair value measurement reflects the contractual terms of the derivative financial instruments, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. More specifically, the fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) with the variable cash payments (or receipts) based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. Likewise, the fair values of interest rate options (i.e., interest rate caps) are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates fall below (or rise above) the strike rate of the floors (or caps), with the variable interest rates used in the calculation of projected receipts on the floor (or cap) based on an expectation of future interest rates derived from observable market interest rate curves and volatilities. The Corporation also incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative financial instruments for the effect of nonperformance risk, the Corporation has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. While the Corporation has determined that the majority of the inputs used to value its derivative financial instruments fall within Level 2 of the fair value hierarchy, the credit valuation adjustments utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. The Corporation has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions as of March 31, 2018, and December 31, 2017, and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivative financial instruments. Therefore, the Corporation has determined that the fair value measures of its derivative financial instruments in their entirety are classified within Level 2 of the fair value hierarchy. Derivative Financial Instruments (Foreign Currency Exchange Forwards): The Corporation provides foreign currency exchange services to customers. In addition, the Corporation may enter into a foreign currency exchange forward to mitigate the exchange rate risk attached to the cash flows of a loan or as an offsetting contract to a forward entered into as a service to our customer. The valuation of the Corporation’s foreign currency exchange forwards is determined using quoted prices of foreign currency exchange forwards with similar characteristics, with consideration given to the nature of the quote and the relationship of recently evidenced market activity to the fair value estimate, and are classified in Level 2 of the fair value hierarchy. See Note 10 for additional disclosures regarding the Corporation’s foreign currency exchange forwards. Derivative Financial Instruments (Commodity Contracts): The Corporation enters into commodity contracts to manage commercial customers' exposure to fluctuating commodity prices, for which the Corporation simultaneously enters into offsetting derivative financial instruments (i.e., mirror commodity contracts) with third parties to manage its risk associated with these financial instruments. The valuation of the Corporation’s commodity contracts is determined using quoted prices of the underlying instruments, and are classified in Level 2 of the fair value hierarchy. See Note 10 for additional disclosures regarding the Corporation’s commodity contracts. The table below presents the Corporation’s financial instruments measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017, aggregated by the level in the fair value hierarchy within which those measurements fall.
The table below presents a rollforward of the balance sheet amounts for the three months ended March 31, 2018 and the year ended December 31, 2017, for financial instruments measured on a recurring basis and classified within Level 3 of the fair value hierarchy.
(a) During the first quarter of 2017, the $200,000 level 3 investment security was transferred to level 2 based upon new pricing information. For Level 3 assets and liabilities measured at fair value on a recurring basis as of March 31, 2018, the Corporation utilized the following valuation techniques and significant unobservable inputs. Derivative Financial Instruments (Mortgage Derivative — Interest Rate Lock Commitments to Originate Residential Mortgage Loans Held for Sale): The fair value is determined by the change in value from each loan’s rate lock date to the expected rate lock expiration date based on the underlying loan attributes, estimated closing ratios, and investor price matrix determined to be reasonably applicable to each loan commitment. The closing ratio calculation takes into consideration historical experience and loan-level attributes, particularly the change in the current interest rates from the time of initial rate lock. The closing ratio is periodically reviewed for reasonableness and reported to the Associated Mortgage Risk Management Committee. At March 31, 2018, the closing ratio was 85%. Derivative Financial Instruments (Mortgage Derivative—Forward Commitments to Sell Mortgage Loans): Mortgage derivatives include forward commitments to deliver closed end residential mortgage loans into conforming Agency Mortgage Backed Securities (To be Announced, "TBA") or conforming Cash Forward sales. The fair value of such instruments is determined by the difference of current market prices for such traded instruments or available from forward cash delivery commitments and the original traded price for such commitments. The Corporation also relies on an internal valuation model to estimate the fair value of its forward commitments to sell residential mortgage loans (i.e., an estimate of what the Corporation would receive or pay to terminate the forward delivery contract based on market prices for similar financial instruments), which includes matching specific terms and maturities of the forward commitments against applicable investor pricing available. While there are Level 2 and 3 inputs used in the valuation models, the Corporation has determined that the majority of the inputs significant in the valuation of both of the mortgage derivatives fall within Level 3 of the fair value hierarchy. See Note 10 for additional disclosure regarding the Corporation’s mortgage derivatives. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Following is a description of the valuation methodologies used for the Corporation’s more significant instruments measured on a nonrecurring basis at the lower of amortized cost or estimated fair value, including the general classification of such instruments pursuant to the valuation hierarchy. Commercial Loans Held for Sale: Loans held for sale are carried at the lower of cost or estimated fair value. The estimated fair value is based on a discounted cash flow analysis, which the Corporation classifies as a Level 2 nonrecurring fair value measurement. Other Real Estate Owned: Certain other real estate owned, upon initial recognition, was re-measured and reported at fair value through a charge off to the allowance for loan losses based upon the estimated fair value of the other real estate owned, less estimated selling costs. The fair value of other real estate owned, upon initial recognition or subsequent impairment, was estimated using appraised values, which the Corporation classifies as a Level 2 nonrecurring fair value measurement. For Level 3 assets and liabilities measured at fair value on a nonrecurring basis as of March 31, 2018, the Corporation utilized the following valuation techniques and significant unobservable inputs. Impaired Loans: The Corporation considers a loan impaired when it is probable that the Corporation will be unable to collect all amounts due according to the original contractual terms of the note agreement, including both principal and interest. Management has determined that commercial and consumer loan relationships that have nonaccrual status or have had their terms restructured in a troubled debt restructuring meet this impaired loan definition. For individually evaluated impaired loans, the amount of impairment is based upon the present value of expected future cash flows discounted at the loan’s effective interest rate, the estimated fair value of the underlying collateral for collateral-dependent loans, or the estimated liquidity of the note. See Note 7 for additional information regarding the Corporation’s impaired loans. Mortgage Servicing Rights: Mortgage servicing rights do not trade in an active, open market with readily observable prices. While sales of mortgage servicing rights do occur, the precise terms and conditions typically are not readily available to allow for a “quoted price for similar assets” comparison. Accordingly, the Corporation utilizes an independent valuation from a third party which uses a discounted cash flow model to estimate the fair value of its mortgage servicing rights. The valuation model incorporates prepayment assumptions to project mortgage servicing rights cash flows based on the current interest rate scenario, which is then discounted to estimate an expected fair value of the mortgage servicing rights. The valuation model considers portfolio characteristics of the underlying mortgages, contractually specified servicing fees, prepayment assumptions, discount rate assumptions, delinquency rates, late charges, other ancillary revenue, costs to service, and other economic factors. The Corporation periodically reviews and assesses the underlying inputs and assumptions used in the model. In addition, the Corporation compares its fair value estimates and assumptions to observable market data for mortgage servicing rights, where available, and to recent market activity and actual portfolio experience. Due to the nature of the valuation inputs, mortgage servicing rights are classified within Level 3 of the fair value hierarchy. The Corporation uses the amortization method (i.e., lower of amortized cost or estimated fair value measured on a nonrecurring basis), not fair value measurement accounting, for its mortgage servicing rights assets. The discounted cash flow analyses that generate expected market prices utilize the observable characteristics of the mortgage servicing rights portfolio, as well as certain unobservable valuation parameters. The significant unobservable inputs used in the fair value measurement of the Corporation’s mortgage servicing rights are the weighted average constant prepayment rate and weighted average discount rate. Significant increases (decreases) in any of those inputs in isolation could result in a significantly lower (higher) fair value measurement. These parameter assumptions fall within a range that the Corporation, in consultation with an independent third party, believes purchasers of servicing would apply to such portfolios sold into the current secondary servicing market. Discussions are held with members from Treasury and the Community, Consumer, and Business segment to reconcile the fair value estimates and the key assumptions used by the respective parties in arriving at those estimates. The Associated Mortgage Risk Management Committee is responsible for providing control over the valuation methodology and key assumptions. To assess the reasonableness of the fair value measurement, the Corporation also compares the fair value and constant prepayment rate to a value calculated by an independent third party on an annual basis. See Note 8 for additional disclosure regarding the Corporation’s mortgage servicing rights. The table below presents the Corporation’s assets measured at fair value on a nonrecurring basis, aggregated by the level in the fair value hierarchy within which those measurements fall.
Certain nonfinancial assets and nonfinancial liabilities measured at fair value on a nonrecurring basis include the fair value analysis in the second step of a goodwill impairment test, and intangible assets and other nonfinancial long-lived assets measured at fair value for impairment assessment. The Corporation's significant Level 3 measurements which employ unobservable inputs that are readily quantifiable pertain to mortgage servicing rights and impaired loans. The table below presents information about these inputs and further discussion is found above.
Fair Value of Financial Instruments The Corporation is required to disclose estimated fair values for its financial instruments. Fair value estimates are set forth below for the Corporation’s financial instruments.
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Retirement Plans |
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Defined Benefit Plan [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Plans | Retirement Plans The Corporation has a noncontributory defined benefit retirement plan (the Retirement Account Plan (“RAP”)) covering substantially all employees who meet participation requirements. The benefits are based primarily on years of service and the employee’s compensation paid. Employees of acquired entities generally participate in the RAP after consummation of the business combinations. Any retirement plans of acquired entities are typically merged into the RAP after completion of the mergers, and credit is usually given to employees for years of service at the acquired institution for vesting and eligibility purposes. The Corporation also provides legacy healthcare access to a limited group of retired employees from a previous acquisition in the Postretirement Plan. There are no other active retiree healthcare plans. Bank Mutual was acquired on February 1, 2018. The Bank Mutual Pension Plan has not yet been merged into the Corporation's Retirement Account Plan. However, Bank Mutual's Postretirement Plan was merged into the Corporation's Postretirement Plan during the first quarter of 2018. The components of net periodic benefit cost for the RAP, Bank Mutual Pension Plan, and \Postretirement Plan for three months ended March 31, 2018 and 2017 were as follows.
The components of net periodic benefit cost other than the service cost component are included in the line item "other" of noninterest expense in the Consolidated Statements of Income. |
Segment Reporting |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | Segment Reporting The Corporation utilizes a risk-based internal profitability measurement system to provide strategic business unit reporting. The profitability measurement system is based on internal management methodologies designed to produce consistent results and reflect the underlying economics of the units. Certain strategic business units have been combined for segment information reporting purposes where the nature of the products and services, the type of customer and the distribution of those products and services are similar. The three reportable segments are Corporate and Commercial Specialty; Community, Consumer, and Business; and Risk Management and Shared Services. The financial information of the Corporation’s segments has been compiled utilizing the accounting policies described in the Corporation’s 2017 Annual Report on Form 10-K, with certain exceptions. The more significant of these exceptions are described herein. The Corporation allocates net interest income using an internal funds transfer pricing ("FTP") methodology that charges users of funds (assets) and credits providers of funds (liabilities, primarily deposits) based on the maturity, prepayment and / or repricing characteristics of the assets and liabilities. The net effect of this allocation is recorded in the Risk Management and Shared Services segment. A credit provision is allocated to segments based on the expected long-term annual net charge off rates attributable to the credit risk of loans managed by the segment during the period. In contrast, the level of the consolidated provision for credit losses is determined based on an incurred loss model using the methodologies described in the Corporation’s 2017 Annual Report on Form 10-K to assess the overall appropriateness of the allowance for loan losses. The net effect of the credit provision is recorded in Risk Management and Shared Services. Indirect expenses incurred by certain centralized support areas are allocated to segments based on actual usage (for example, volume measurements) and other criteria. Certain types of administrative expense and bank-wide expense accruals (including amortization of core deposit and other intangible assets associated with acquisitions) are generally not allocated to segments. Income taxes are allocated to segments based on the Corporation’s estimated effective tax rate, with certain segments adjusted for any tax-exempt income or non-deductible expenses. Equity is allocated to the segments based on regulatory capital requirements and in proportion to an assessment of the inherent risks associated with the business of the segment (including interest, credit and operating risk). The management accounting policies and processes utilized in compiling segment financial information are highly subjective and, unlike financial accounting, are not based on authoritative guidance similar to U.S. generally accepted accounting principles. As a result, reported segments and the financial information of the reported segments are not necessarily comparable with similar information reported by other financial institutions. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in previously reported segment financial data. A brief description of each business segment is presented below. A more in-depth discussion of these segments can be found in the Segment Reporting footnote in the Corporation’s 2017 Annual Report on Form 10-K. The Corporate and Commercial Specialty segment serves a wide range of customers including larger businesses, developers, not-for-profits, municipalities, and financial institutions. The Community, Consumer, and Business segment serves individuals, as well as small and mid-sized businesses. The Risk Management and Shared Services segment includes key shared operational functions and also includes residual revenue and expenses, representing the difference between actual amounts incurred and the amounts allocated to operating segments, including interest rate risk residuals (FTP mismatches) and credit risk and provision residuals (long-term credit charge mismatches). In addition, the Risk Management and Shared Services segment includes certain unallocated expenses related to Bank Mutual's shared services and operations prior to system conversion in late June 2018. Information about the Corporation’s segments is presented below.
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Accumulated Other Comprehensive Income (Loss) |
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Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The following tables summarize the components of accumulated other comprehensive income (loss) at March 31, 2018 and 2017, changes during the three month periods then ended, and reclassifications out of accumulated other comprehensive income (loss) during the three month periods ended March 31, 2018 and 2017, respectively.
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Revenues |
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Revenue Recognition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition 606 [Text Block] | Below is a listing of performance obligations for our main revenue streams.
(1) Loan fees are out-of-scope of Topic 606. Arrangements with Multiple Performance Obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the expected cost plus margin. Practical Expedients We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Using the practical expedient, for contracts with a term of one year or less, the Corporation recognizes incremental costs of obtaining those contracts as an expense when incurred. |
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Revenues | Revenues On January 1, 2018, the Corporation adopted Topic 606 using the modified retrospective method. As stated in Note 3, the implementation of the new standard had an immaterial impact to the Corporation. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606. Revenue is recognized when obligations under the terms of a contract with our customer are satisfied. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. We do not have any material significant payment terms as payment is received at or shortly after the satisfaction of the performance obligation. The following table disaggregates our revenue by major source for the three months ended March 31, 2018 and March 31, 2017.
During the first quarter of 2018, the Corporation acquired Bank Mutual. This acquisition resulted in increased service charges and deposit account fees and card-based and loan fees. In addition, the Corporation acquired Diversified Investment Solutions and Whitnell & Co. since the first quarter of 2017, which resulted in increased trust and asset management fees and brokerage commissions and fees. Below is a listing of performance obligations for our main revenue streams.
(1) Loan fees are out-of-scope of Topic 606. Arrangements with Multiple Performance Obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the expected cost plus margin. Practical Expedients We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. Using the practical expedient, for contracts with a term of one year or less, the Corporation recognizes incremental costs of obtaining those contracts as an expense when incurred. |
Summary of Significant Accounting Policies (Policies) |
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New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Corporation recognizes revenue in accordance with ASC 606, "Revenue from Contracts with Customers". ASC 606 requires the Corporation to follow a five step process: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation. Revenue recognition under ASC 606 depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for the goods or services. |
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Finance, Loan and Lease Receivables, Held-for-sale, Policy | Business combinations The Corporation accounts for its acquisitions using the purchase accounting method. Purchase accounting requires the total purchase price to be allocated to the estimated fair values of assets acquired and liabilities assumed, including certain intangible assets that must be recognized. Typically, this allocation results in the purchase price exceeding the fair value of net assets acquired, which is recorded as goodwill. Core deposit intangibles are a measure of the value of checking, money market and savings deposits acquired in business combinations accounted for under the purchase method. Core deposit intangibles and other identified intangibles with finite useful lives are amortized using the straight line method over their estimated useful lives of up to ten years. Loans that the Corporation acquires in connection with acquisitions are recorded at fair value with no carryover of the related allowance for credit losses. Fair value of the loans involves estimating the amount and timing of principal and interest cash flows expected to be collected on the loans and discounting those cash flows at a market rate of interest. The excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loan. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the non-accretable discount. The non-accretable discount includes estimated future credit losses expected to be incurred over the life of the loan. Subsequent decreases to the expected cash flows will require the Corporation to evaluate the need for an additional allowance for credit losses. Subsequent improvement in expected cash flows will result in the reversal of a corresponding amount of the non-accretable discount which the Corporation will then reclassify as accretable discount that will be recognized into interest income over the remaining life of the loan. The Corporation accounts for performing loans acquired in business combinations using the contractual cash flows method of recognizing discount accretion based on the acquired loans’ contractual cash flows. Purchased performing loans are recorded at fair value, including credit, interest, and liquidity discounts. The fair value discount is accreted as an adjustment to yield over the estimated lives of the loans. There is no allowance for loan losses established at the acquisition date for purchased performing loans. A provision for loan losses is recorded for any further deterioration in these loans subsequent to the acquisition. |
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New Accounting Pronouncements, Policy | New Accounting Pronouncements Adopted
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Acquisitions (Tables) |
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Business Combinations [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table presents the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date related to Bank Mutual.
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Earnings Per Common Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Calculations for basic and diluted earnings per common share | Presented below are the calculations for basic and diluted earnings per common share.
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Stock-Based Compensation (Tables) |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value assumptions of stock options | The following assumptions were used in estimating the fair value for options granted in the first three months of 2018 and full year 2017.
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Summary of Company's Stock Option Activities | A summary of the Corporation’s stock option activity for the three months ended March 31, 2018 is presented below.
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Summary of Restricted Stock Awards Activity (Excluding Salary Shares) | The following table summarizes information about the Corporation’s restricted stock activity for the three months ended March 31, 2018.
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Investment Securities (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment securities available for sale | A portion of the portfolio is also comprised of asset-backed securities backed by student loans made under the Federal Family Education Loan Program ("FFELP"). The amortized cost and fair values of securities available for sale and held to maturity were as follows.
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Investment securities held to maturity | A portion of the portfolio is also comprised of asset-backed securities backed by student loans made under the Federal Family Education Loan Program ("FFELP"). The amortized cost and fair values of securities available for sale and held to maturity were as follows.
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Amortized cost and fair values of investment securities by contractual maturity | The expected maturities of investment securities available for sale and held to maturity at March 31, 2018, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
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Realized gains and losses and proceeds from sale | The following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position, at March 31, 2018.
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Unrealized losses and fair value of available for sale and held to maturity securities, by investment category and time length | The following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position, at March 31, 2018.
For comparative purposes, the following represents gross unrealized losses and the related fair value of investment securities available for sale and held to maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2017.
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Loans (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan composition | The period end loan composition was as follows.
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Commercial and consumer loans by credit quality indicator | The following table presents commercial and consumer loans by credit quality indicator at March 31, 2018.
The following table presents commercial and consumer loans by credit quality indicator at December 31, 2017.
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Summarized details of Loans | The following table presents loans by past due status at March 31, 2018.
The following table presents loans by past due status at December 31, 2017.
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Summarized details of impaired Loans | The following table presents impaired loans individually evaluated under ASC Topic 310, excluding purchased credit-impaired loans, at March 31, 2018.
The following table presents impaired loans individually evaluated under ASC Topic 310 at December 31, 2017.
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Nonaccrual and performing restructured loans | The following table presents nonaccrual and performing restructured loans by loan portfolio.
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Summary of restructured loans | The following table provides the number of loans modified in a troubled debt restructuring by loan portfolio during the three months ended March 31, 2018 and 2017, respectively, and the recorded investment and unpaid principal balance as of March 31, 2018 and 2017, respectively.
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Troubled debt restructurings subsequent redefault | The following table provides the number of loans modified in a troubled debt restructuring during the previous twelve months which subsequently defaulted during the three months ended March 31, 2018 and 2017, respectively, as well as the recorded investment in these restructured loans as of March 31, 2018 and 2017, respectively.
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Changes in the allowance for loan losses by portfolio segment |
The following table presents a summary of the changes in the allowance for loan losses by portfolio segment for the three months ended March 31, 2018.
For comparison purposes, a summary of the changes in the allowance for loan losses by portfolio segment for the year ended December 31, 2017, was as follows.
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Changes in the allowance for unfunded commitments | The following table presents a summary of the changes in the allowance for unfunded commitments.
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Changes In Accretable Yield For Purchased Credit Impaired | Changes in the accretable yield for loans acquired and accounted for under ASC Topic 310-30 were as follows for the three months ended March 31, 2018 and for the year ended December 31, 2017
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Goodwill and Other Intangible Assets (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of core deposit intangibles and other intangibles | For core deposit intangibles and other intangibles, changes in the gross carrying amount, accumulated amortization, and net book value were as follows.
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Summary of changes in balance of mortgage servicing rights asset and mortgage servicing rights valuation allowance | A summary of changes in the balance of the mortgage servicing rights asset and the mortgage servicing rights valuation allowance was as follows.
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Summary of estimated future amortization expense | The following table shows the estimated future amortization expense for amortizing intangible assets. The projections of amortization expense are based on existing asset balances, the current interest rate environment, and prepayment speeds as of March 31, 2018. The actual amortization expense the Corporation recognizes in any given period may be significantly different depending upon acquisition or sale activities, changes in interest rates, prepayment speeds, market conditions, regulatory requirements, and events or circumstances that indicate the carrying amount of an asset may not be recoverable.
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Short and Long-Term Funding (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Breakdown of short & long-term debt balances | he components of short-term funding (funding with original contractual maturities of one year or less) and long-term funding (funding with original contractual maturities greater than one year).
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Remaining contractual maturity of securities sold under agreements to repurchase | The remaining contractual maturity of the securities sold under agreements to repurchase in the consolidated balance sheets as of March 31, 2018 and December 31, 2017 are presented in the following table.
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Derivative and Hedging Activities (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary Of Other derivative instruments not designated as hedging instruments | The table below identifies the balance sheet category and fair values of the Corporation’s derivative instruments.
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Cumulative Basis Adjustment for Fair Value Hedges | The following table presents amounts that were recorded on the balance sheet related to cumulative basis adjustment for fair value hedges.
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Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block] | The table below identifies the effect of fair value hedge accounting on the Corporation's statement of performance during the three months ended March 31, 2018.
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Gain (loss) on derivative instruments not designated as hedging instruments | The table below identifies the effect of derivatives not designated as hedging instruments on the Corporation's statement of performance during the three months ended March 31, 2018.
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Balance Sheet Offsetting (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Offsetting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Offsetting of Derivative Assets and Liabilities | The following table presents the assets and liabilities subject to an enforceable master netting arrangement. The interest and commodity agreements we have with our commercial customers are not subject to an enforceable master netting arrangement, and therefore, are excluded from this table.
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Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of lending-related and other commitments | The following is a summary of lending-related commitments.
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Summary of changes in the residential mortgage repurchase reserve | The following summarizes the changes in the mortgage repurchase reserve.
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Fair Value Measurements (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities Measured on Recurring Basis at Fair Value | The table below presents the Corporation’s financial instruments measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017, aggregated by the level in the fair value hierarchy within which those measurements fall.
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Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | The table below presents a rollforward of the balance sheet amounts for the three months ended March 31, 2018 and the year ended December 31, 2017, for financial instruments measured on a recurring basis and classified within Level 3 of the fair value hierarchy.
(a) During the first quarter of 2017, the $200,000 level 3 investment security was transferred to level 2 based upon new pricing information. |
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Assets and Liabilities Measured on Nonrecurring Basis at Fair Value | The table below presents the Corporation’s assets measured at fair value on a nonrecurring basis, aggregated by the level in the fair value hierarchy within which those measurements fall.
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Schedule of Assumptions for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Table Text Block] | The table below presents information about these inputs and further discussion is found above.
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Estimated fair values of financial instruments | Fair value estimates are set forth below for the Corporation’s financial instruments.
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Retirement Plans (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Defined Benefit Plan [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net period benefit cost for the pension and postretirement plans | The components of net periodic benefit cost for the RAP, Bank Mutual Pension Plan, and \Postretirement Plan for three months ended March 31, 2018 and 2017 were as follows.
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Segment Reporting (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Selected segment information | Information about the Corporation’s segments is presented below.
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Accumulated Other Comprehensive Income (Loss) (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of activity in accumulated other comprehensive income (loss) | The following tables summarize the components of accumulated other comprehensive income (loss) at March 31, 2018 and 2017, changes during the three month periods then ended, and reclassifications out of accumulated other comprehensive income (loss) during the three month periods ended March 31, 2018 and 2017, respectively.
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Revenues (Tables) |
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Revenue Recognition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue by Major Source | The following table disaggregates our revenue by major source for the three months ended March 31, 2018 and March 31, 2017.
|
Acquisitions - Narrative (Details) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Feb. 01, 2018 |
Jan. 31, 2018 |
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Business Acquisition [Line Items] | ||||
Value of stock transaction | $ 134,000 | $ 0 | ||
Bank Mutual | ||||
Business Acquisition [Line Items] | ||||
Value of stock transaction | $ 482,000,000 | |||
Number of shares received by shareholders (in shares) | 0.422 | |||
Number of shares issued | 19,500,000 | |||
Goodwill acquired | $ 167,000,000 | |||
Amortization period | 10 years | |||
Additions to finite-lived intangible assets | 58,000,000 | |||
Diversified Insurance Solutions | ||||
Business Acquisition [Line Items] | ||||
Goodwill acquired | 10,000,000 | |||
Value of acquisition | 19,000,000 | |||
Additions to finite-lived intangible assets | $ 8,000,000 |
Summary of Significant Accounting Policies textuals (Details) shares in Thousands, $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2018
USD ($)
shares
| |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Expense Relcass (asu 2017-07) | $ 9,000 |
Visa Restricted Stock Owned | shares | 119 |
AOCI Attributable to Parent [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Reporting Comprehensive Income(2018-02) | $ 13,654 |
Earnings Per Common Share (Textual) (Details) - shares shares in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,000 | 4,000 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | ||
Employee Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 500 |
Investment Securities (Details Textual) - USD ($) $ in Millions |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Investment Securities (Textuals) [Abstract] | ||
Securities pledged as collateral | $ 3,000 | $ 3,100 |
Federal Home Loan Bank Stock | 157 | 89 |
Federal Reserve Bank Stock | $ 76 | $ 76 |
Loans, Troubled Debt Restructurings Subsequent Default (Details) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018
USD ($)
loan
|
Mar. 31, 2017
USD ($)
loan
|
|
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 16 | 8 |
Recorded Investment | $ | $ 1,421 | $ 409 |
Residential mortgage | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 4 | 6 |
Recorded Investment | $ | $ 467 | $ 383 |
Home equity | ||
Financing Receivable, Modifications [Line Items] | ||
Number of Loans | loan | 12 | 2 |
Recorded Investment | $ | $ 954 | $ 26 |
Loans, Changes in the Allowance for Loan Losses (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Change in the allowance for unfunded commitments | ||
Balance at beginning of period | $ 24,000 | |
Balance at end of period | 26,000 | $ 24,000 |
Allowance for Unfunded Commitments: | ||
Change in the allowance for unfunded commitments | ||
Balance at beginning of period | 24,400 | 25,400 |
Provision for unfunded commitments | (500) | (1,000) |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Provision for Loan Losses | 2,436 | 0 |
Balance at end of period | $ 26,336 | $ 24,400 |
Loans - Changes to Accretable Yield (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | ||
Balance at beginning of period | $ 0 | $ 0 |
Purchases | 4,244 | 0 |
Accretion | 0 | 0 |
Other | 0 | 0 |
Balance at end of period | $ 4,244 | $ 0 |
Loans - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Receivables [Abstract] | ||||
Financing Receivable, Modifications, Post-Modification Recorded Investment | $ 3,958 | $ 54,911 | ||
Restructured Loans Subsequently Accruing | 1,000 | |||
Ytd Restructured Loans Still On Nonaccrual | 3,000 | |||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for loan losses | 257,058 | $ 265,880 | $ 278,335 | |
Oil and Gas Portfolio Segment | ||||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||||
Allowance for loan losses | $ 19,000 | $ 27,000 | $ 38,000 | |
Percent of loans | 3.00% |
Goodwill and Other Intangible Assets, Summary of Core Deposit and Other Intangibles (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Summary of core deposit intangibles and other intangibles | |||
Amortization of other intangible assets | $ 1,525 | $ 513 | |
Core Deposit Intangibles | |||
Summary of core deposit intangibles and other intangibles | |||
Gross carrying amount | 58,100 | $ 4,385 | |
Accumulated amortization | (968) | (4,385) | |
Total Estimated Amortization Expense | 57,132 | 0 | |
Amortization of other intangible assets | 968 | 112 | |
Adjustments to Core Deposits [Member] | |||
Summary of core deposit intangibles and other intangibles | |||
Total Estimated Amortization Expense | 58,100 | 0 | |
Other Intangible Assets | |||
Summary of core deposit intangibles and other intangibles | |||
Gross carrying amount | 42,131 | 34,572 | |
Accumulated amortization | (19,549) | (18,992) | |
Total Estimated Amortization Expense | 22,582 | $ 15,580 | |
Additions during the period | 7,559 | 2,162 | |
Amortization of other intangible assets | $ 557 | $ 1,847 |
Goodwill and Other Intangible Assets, Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Other Intangible Assets | ||
Estimated future amortization expense | ||
Nine Months Ended December 31, 2018 | $ 2,045 | |
Year ending December 31, 2018 | 2,428 | |
Year ending December 31, 2019 | 2,311 | |
Year ending December 31, 2020 | 2,287 | |
Year ending December 31, 2021 | 2,263 | |
Year ending December 31, 2022 | 2,244 | |
Beyond 2022 | 9,004 | |
Total Estimated Amortization Expense | 22,582 | $ 15,580 |
Mortgage Servicing Rights | ||
Estimated future amortization expense | ||
Nine Months Ended December 31, 2018 | 7,115 | |
Year ending December 31, 2018 | 9,324 | |
Year ending December 31, 2019 | 8,078 | |
Year ending December 31, 2020 | 6,977 | |
Year ending December 31, 2021 | 6,035 | |
Year ending December 31, 2022 | 5,234 | |
Beyond 2022 | 23,954 | |
Total Estimated Amortization Expense | 66,717 | |
Core Deposit Intangibles | ||
Estimated future amortization expense | ||
Nine Months Ended December 31, 2018 | 4,358 | |
Year ending December 31, 2018 | 5,810 | |
Year ending December 31, 2019 | 5,810 | |
Year ending December 31, 2020 | 5,810 | |
Year ending December 31, 2021 | 5,810 | |
Year ending December 31, 2022 | 5,810 | |
Beyond 2022 | 23,724 | |
Total Estimated Amortization Expense | $ 57,132 | $ 0 |
Goodwill and Other Intangible Assets (Details Textuals) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Feb. 01, 2018 |
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Business Acquisition [Line Items] | ||||
Goodwill | $ 1,153,156,000 | $ 976,239,000 | ||
Goodwill, Impairment Loss | 0 | $ 0 | ||
Bank Mutual | ||||
Business Acquisition [Line Items] | ||||
Goodwill acquired | $ 167,000,000 | |||
Additions to finite-lived intangible assets | 58,000,000 | |||
Diversified Insurance Solutions | ||||
Business Acquisition [Line Items] | ||||
Goodwill acquired | 10,000,000 | |||
Additions to finite-lived intangible assets | $ 8,000,000 |
Short and Long-Term Funding (Components of Short-term and Long-term Funding) (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Short-term Funding [Abstract] | ||
Federal funds purchased | $ 69,085 | $ 141,950 |
Securities sold under agreements to repurchase | 214,869 | 182,865 |
Federal funds purchased and securities sold under agreements to repurchase | 283,954 | 324,815 |
FHLB advances | 1,780,000 | 284,000 |
Commercial paper | 82,420 | 67,467 |
Other short-term funding | 1,862,420 | 351,467 |
Total short-term funding | 2,146,374 | 676,282 |
Long-term Funding | ||
FHLB advances | 2,735,887 | 2,900,168 |
Senior notes, at par | 250,000 | 250,000 |
Subordinated notes, at par | 250,000 | 250,000 |
Other long-term funding and capitalized costs | (2,549) | (2,718) |
Total long-term funding | 3,233,338 | 3,397,450 |
Total short and long-term funding | $ 5,379,712 | $ 4,073,732 |
Short and Long-Term Funding (Remaining Contractual Maturity of the Securities Sold Under Agreements to Repurchase) (Details) - USD ($) |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | $ 214,869,000 | $ 182,865,000 |
Overnight and Continuous | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 214,869,000 | 182,865,000 |
Up to 30 days | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 0 | 0 |
30-90 days | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 0 | 0 |
Greater than 90 days | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 0 | 0 |
Agency mortgage-related securities | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 214,869,000 | 182,865,000 |
Agency mortgage-related securities | Overnight and Continuous | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 214,869,000 | 182,865,000 |
Agency mortgage-related securities | Up to 30 days | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 0 | 0 |
Agency mortgage-related securities | 30-90 days | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | 0 | 0 |
Agency mortgage-related securities | Greater than 90 days | ||
RemainingContractualMaturityoftheSecuritiesSoldUnderAgreementtoRepurchase [Line Items] | ||
Repurchase agreements | $ 0 | $ 0 |
Short and Long-Term Funding (Long-term Funding Narrative) (Details) - USD ($) $ in Millions |
1 Months Ended | ||
---|---|---|---|
Nov. 30, 2014 |
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Subordinated Borrowing [Line Items] | |||
Carrying Value of Securities Purchased under Agreements to Resell and Deposits Paid for Securities Borrowed | $ 288 | ||
Federal Home Loan Bank, Advances, Weighted Average Interest Rate | 1.50% | 1.26% | |
Two Thousand Fourteen Senior Notes | |||
Subordinated Borrowing [Line Items] | |||
New Senior Debt Issued | $ 250 | ||
Debt Instrument, Interest Rate, Stated Percentage | 2.75% | ||
Two Thousand Fourteen Subordinated Notes | |||
Subordinated Borrowing [Line Items] | |||
Junior Subordinated Debentures Issued | $ 250 | ||
Debt Instrument, Term | 10 years | ||
Subordinated Borrowing, Interest Rate | 4.25% |
Derivative and Hedging Activities, Derivative Instruments Not Designated as Hedging Instruments (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Not Designated as Hedging Instrument | Trading assets | Interest rate-related instruments — customer and mirror | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | $ 2,626,982 | $ 2,183,687 |
Derivative, Fair Value, Net | 53,189 | 28,494 |
Not Designated as Hedging Instrument | Trading assets | Foreign currency exchange forwards | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 140,554 | 124,851 |
Derivative, Fair Value, Net | 2,612 | 2,495 |
Not Designated as Hedging Instrument | Trading assets | Commodity contracts | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 467,979 | 457,868 |
Derivative, Fair Value, Net | 47,089 | 38,686 |
Not Designated as Hedging Instrument | Trading liabilities | Interest rate-related instruments — customer and mirror | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 2,626,982 | 2,183,687 |
Derivative, Fair Value, Net | (52,238) | (28,035) |
Not Designated as Hedging Instrument | Trading liabilities | Foreign currency exchange forwards | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 137,073 | 118,094 |
Derivative, Fair Value, Net | (2,484) | (2,339) |
Not Designated as Hedging Instrument | Trading liabilities | Commodity contracts | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 467,957 | 457,108 |
Derivative, Fair Value, Net | (45,525) | (37,286) |
Not Designated as Hedging Instrument | Other assets | Interest rate lock commitments (mortgage) | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 312,567 | 222,736 |
Derivative, Fair Value, Net | 3,032 | 1,538 |
Not Designated as Hedging Instrument | Other assets | Purchased options (time deposit) | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 26,389 | 31,063 |
Derivative, Fair Value, Net | 951 | 1,175 |
Not Designated as Hedging Instrument | Other liabilities | Forward commitments (mortgage) | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 245,000 | 164,567 |
Derivative, Fair Value, Net | (303) | (313) |
Not Designated as Hedging Instrument | Other liabilities | Written options (time deposit) | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 26,389 | 31,063 |
Derivative, Fair Value, Net | (951) | (1,175) |
Designated as Hedging Instrument | Other assets | interest rate product [Member] | ||
Derivative Instruments Not Designated as Hedging Instruments [Abstract] | ||
Notional Amount | 250,000 | 0 |
Derivative, Fair Value, Net | $ 258 | $ 0 |
Derivative and Hedging Activities - Cumulative Basis Adjustment for Fair Value Hedges (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Balance Sheet Recording of Fair Value Hedge [Line Items] | ||
Carrying Amount of the Hedged Assets/(Liabilities) | $ 102,890 | $ 69,675 |
Designated as Hedging Instrument | ||
Balance Sheet Recording of Fair Value Hedge [Line Items] | ||
Carrying Amount of the Hedged Assets/(Liabilities) | 250,000 | |
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | 276 | |
Amortized cost basis of hedged asset | 523,000 | |
adjustment [Member] | Designated as Hedging Instrument | ||
Balance Sheet Recording of Fair Value Hedge [Line Items] | ||
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | 276 | |
Carrying Value [Member] | Designated as Hedging Instrument | ||
Balance Sheet Recording of Fair Value Hedge [Line Items] | ||
Carrying Amount of the Hedged Assets/(Liabilities) | $ 249,724 |
Derivative and Hedging Activities Income impact of Fair Value and Cash Flow Hedge (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
|
Interest Income [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge | $ 18 | $ 0 |
Other Operating Income (Expense) [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge | 0 | 0 |
Not Designated as Hedging Instrument, Economic Hedge [Member] | Interest Income [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge | 276 | 0 |
Not Designated as Hedging Instrument, Economic Hedge [Member] | Other Operating Income (Expense) [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge | 0 | 0 |
Designated as Hedging Instrument | Interest Income [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge | (258) | 0 |
Designated as Hedging Instrument | Other Operating Income (Expense) [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Change in Unrealized Gain (Loss) on Hedged Item in Fair Value Hedge | $ 0 | $ 0 |
Derivative and Hedging Activities Derivative Impact on Perfomance (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Capital Market Fees [Member] | Interest Rate Related Instruments Customer and Mirror [Member] | ||
Derivative Impact on Performance [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 492 | $ 245 |
Capital Market Fees [Member] | Foreign Exchange Forward [Member] | ||
Derivative Impact on Performance [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (28) | (21) |
Capital Market Fees [Member] | Commodity Contract [Member] | ||
Derivative Impact on Performance [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 164 | 226 |
Mortgage Banking [Member] | Interest Rate Lock Commitments [Member] | ||
Derivative Impact on Performance [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 1,494 | 1,597 |
Mortgage Banking [Member] | Forward Contracts [Member] | ||
Derivative Impact on Performance [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 10 | $ (3,281) |
Derivative and Hedging Activities (Details Textuals) - USD ($) $ in Millions |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Investment securities and cash equivalents pledged as collateral | $ 28 | $ 24 |
Derivative collateral right to reclaim cash | $ 29 | $ 22 |
Balance Sheet Offsetting (Details) - Interest and commodity agreements - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Offsetting Derivative Assets [Abstract] | ||
Gross amounts recognized | $ 47,528 | $ 29,503 |
Gross amounts offset in the balance sheet | 0 | 0 |
Net amounts presented in the balance sheet | 47,528 | 29,503 |
Financial instruments | (43,105) | (29,503) |
Collateral | (1,337) | 0 |
Net amount | 3,086 | 0 |
Offsetting Derivative Liabilities [Abstract] | ||
Gross amounts recognized | 43,105 | 37,164 |
Gross amounts offset in the balance sheet | 0 | 0 |
Net amounts presented in the balance sheet | 43,105 | 37,164 |
Financial instruments | (43,105) | (29,503) |
Collateral | 0 | (7,661) |
Net amount | $ 0 | $ 0 |
Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters, Summary of Lending Related and Other Commitments (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Schedule of lending-related and other commitments [Line Items] | ||
Lending related commitments, fair value | $ 0 | $ 0 |
Commitments to extend credit, excluding commitments to originate residential mortgage loans held for sale | ||
Summary of lending-related and other commitments | ||
Lending related commitments | 8,481,563 | 8,027,187 |
Commercial Letters Of Credit | ||
Summary of lending-related and other commitments | ||
Lending related commitments | 12,456 | 11,886 |
Standby Letters of Credit | ||
Summary of lending-related and other commitments | ||
Lending related commitments | 253,857 | 235,361 |
Standby letters of credit, fair value | $ 2,000 | $ 2,000 |
Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters Residential Mortgage Repurchase Reserve (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Residential mortgage repurchase reserve | ||
Balance at beginning of period | $ 24,000 | |
Balance at end of period | 26,000 | |
Mortgage Repurchase Reserve | ||
Residential mortgage repurchase reserve | ||
Balance at beginning of period | 987 | $ 900 |
Repurchase provision expense | 56 | 246 |
Charge offs, net | (48) | (159) |
Valuation Allowances and Reserves, Reserves of Businesses Acquired | 88 | $ 0 |
Balance at end of period | $ 1,083 |
Commitments, Off-Balance Sheet Arrangements, Legal Proceedings and Regulatory Matters (Details Textuals) |
Jan. 11, 2016
USD ($)
complaint
|
May 22, 2015
USD ($)
branch
loan_production_office
|
Mar. 31, 2018
USD ($)
|
Dec. 31, 2017
USD ($)
|
Sep. 06, 2017
complaint
|
Aug. 30, 2017
complaint
|
Jul. 28, 2017
complaint
|
---|---|---|---|---|---|---|---|
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Valuation Allowances and Reserves, Balance | $ 26,000,000 | $ 24,000,000 | |||||
Number of complaints filed under legal proceedings | complaint | 2 | ||||||
Conciliation Agreement, Commitment Term | 3 years | ||||||
Conciliation Agreement, Mortgage Loan Commitment | $ 196,000,000 | ||||||
Conciliation Agreement, Number of Branch Opening Commitments | branch | 1 | ||||||
Conciliation Agreement, Number of Loan Production Offices, Commitment | loan_production_office | 4 | ||||||
Loans Repurchased Under Make Whole Requests | 0 | 1,000,000 | |||||
Loans Sold To Outside Investors Original Amount | 10,000,000,000 | ||||||
Loans Sold To Outside Investors Remaining Outstanding Amount | 6,000,000,000 | ||||||
Residential Mortgage Loans Sold With Recourse Risk | 36,000,000 | 44,000,000 | |||||
Residential Mortgage Loans Sold With Credit Recourse Risk | 69,000,000 | 73,000,000 | |||||
The Official Committee of Unsecured Creditors of World Marketing Chicago LLC v Associated Bank [Member] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Loss Contingency, Damages Sought, Value | $ 6,000,000 | ||||||
Loss Contingency, Damages Sought, Value, Cash | 4,000,000 | ||||||
American Funds Service Company v Associated Bank [Member] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Loss Contingency, Damages Sought, Value | 600,000 | ||||||
Loss Contingency, Damages Sought, Value, Cash | $ 540,000 | ||||||
Schumel et al v. Bank Mutual Corporation et al, and Paquin et al v. Bank Mutual Corporation et al [Domain] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Number of complaints filed under legal proceedings | complaint | 2 | ||||||
Wollenburg et al. v. Bank Mutual Corporation et al. [Member] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Number of complaints filed under legal proceedings | complaint | 1 | ||||||
Parshall et al. v. Bank Mutual Corporation et al. [Member] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Number of complaints filed under legal proceedings | complaint | 1 | ||||||
UnconsolidatedProjectsLowIncomeHousing [Member] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Other Investments | 142,000,000 | 147,000,000 | |||||
Commitments Under Unconsolidated Projects | 111,000,000 | 119,000,000 | |||||
PrincipalInvestmentCommitment [Member] | |||||||
Commitments, Off-Balance Sheet Arrangements, and Contingent Liabilities (Textuals) [Line Items] | |||||||
Other Investments | $ 24,000,000 | $ 23,000,000 |
Fair Value Measurements, Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Investment securities available for sale: | ||
Investment securities available for sale | $ 4,485,875 | $ 4,043,446 |
Trading assets | 102,890 | 69,675 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 100,247 | 67,660 |
Fair Value, Inputs, Level 1 | ||
Investment securities available for sale: | ||
Investment securities available for sale | 2,594 | 2,628 |
Fair Value, Inputs, Level 2 | ||
Investment securities available for sale: | ||
Investment securities available for sale | 4,483,281 | 4,040,818 |
Trading assets | 104,099 | 70,850 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 101,198 | 68,835 |
Fair Value, Inputs, Level 3 | ||
Investment securities available for sale: | ||
Trading assets | 3,032 | 1,538 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 303 | 313 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | US Treasury Securities | ||
Investment securities available for sale: | ||
Investment securities available for sale | 995 | 996 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | Other Debt And Other Equity Securities | ||
Investment securities available for sale: | ||
Investment securities available for sale | 1,599 | 1,632 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | Total investment securities available for sale | ||
Investment securities available for sale: | ||
Investment securities available for sale | 2,594 | 2,628 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | FNMA / FHLMC | ||
Investment securities available for sale: | ||
Investment securities available for sale | 430,073 | 464,768 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | GNMA | ||
Investment securities available for sale: | ||
Investment securities available for sale | 2,310,306 | 1,913,350 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Private Label | ||
Investment securities available for sale: | ||
Investment securities available for sale | 1,044 | 1,059 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | GNMA Commercial Mortgage-Related Securities | ||
Investment securities available for sale: | ||
Investment securities available for sale | 1,448,369 | 1,513,277 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Federal Family Education Loan Program (FFELP) Guaranteed Loans [Member] | ||
Investment securities available for sale: | ||
Investment securities available for sale | 290,300 | 145,176 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Other Debt And Other Equity Securities | ||
Investment securities available for sale: | ||
Investment securities available for sale | 3,188 | 3,188 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Total investment securities available for sale | ||
Investment securities available for sale: | ||
Investment securities available for sale | 4,483,281 | 4,040,818 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Residential Loans Held For Sale Member | ||
Investment securities available for sale: | ||
Trading assets | 103,953 | 85,544 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Interest rate-related instruments — customer and mirror | ||
Investment securities available for sale: | ||
Trading assets | 53,189 | 28,494 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 52,238 | 28,035 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Foreign currency exchange forwards | ||
Investment securities available for sale: | ||
Trading assets | 2,612 | 2,495 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 2,484 | 2,339 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Commodity contracts | ||
Investment securities available for sale: | ||
Trading assets | 47,089 | 38,686 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 45,525 | 37,286 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2 | Purchased options (time deposit) | ||
Investment securities available for sale: | ||
Trading assets | 951 | 1,175 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 951 | 1,175 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Interest rate lock commitments (mortgage) | ||
Investment securities available for sale: | ||
Trading assets | 3,032 | 1,538 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Forward commitments (mortgage) | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Trading liabilities | 303 | 313 |
Total commercial | Fair Value, Inputs, Level 2 | ||
Investment securities available for sale: | ||
Loans Held-for-sale, Fair Value Disclosure | 6,091 | 0 |
Designated as Hedging Instrument | ||
Investment securities available for sale: | ||
Trading assets | 250,000 | |
Designated as Hedging Instrument | Fair Value, Inputs, Level 2 | ||
Investment securities available for sale: | ||
Interest Rate Fair Value Hedge Derivative at Fair Value, Net | $ 258 | $ 0 |
Fair Value Measurements - Financial Instruments Classified Within Level 3 (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
Mar. 31, 2017 |
|
Total investment securities available for sale | |||
Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | |||
Beginning Balance | $ 0 | $ 200 | |
Ending Balance | 0 | 0 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | |||
Mortgage derivative loss | 0 | 0 | |
Total investment securities available for sale | Fair Value, Measurements, Recurring | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Transfer of level 3 to level 2 based on new pricing information | 200 | ||
Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | |||
Transfer out of level 3 securities | (200) | ||
Derivative Financial Instruments | |||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | |||
Beginning Balance | 1,225 | 3,114 | |
Mortgage derivative loss | 1,501 | (1,889) | |
Ending Balance | $ 2,726 | 1,225 | |
Derivative Financial Instruments | Fair Value, Measurements, Recurring | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Transfer of level 3 to level 2 based on new pricing information | 0 | ||
Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | |||
Transfer out of level 3 securities | $ 0 | ||
Investment security | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Transfer of level 3 to level 2 based on new pricing information | $ 200 | ||
Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | |||
Transfer out of level 3 securities | $ (200) |
Fair Value Measurements, Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Assets and Liabilities Measured at Fair Value on a Non-recurring Basis | |||
Commercial Loans Held-for-sale, Fair Value Disclosure | $ 6,091 | $ 0 | |
Mortgage servicing rights | 66,407 | 58,384 | |
Mortgage Servicing Rights (MSR) Impairment (Recovery) | (474) | $ 217 | |
Fair Value, Inputs, Level 2 | |||
Assets and Liabilities Measured at Fair Value on a Non-recurring Basis | |||
Commercial Loans Held-for-sale, Fair Value Disclosure | 6,091 | 0 | |
Residential Held-for-sale, Fair Value Disclosure | 103,953 | 85,544 | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 | |||
Assets and Liabilities Measured at Fair Value on a Non-recurring Basis | |||
Commercial Loans Held-for-sale, Fair Value Disclosure | 6,091 | ||
Provision for Credit Losses, Commercial Loans held-for-sale | 0 | ||
Other Real Estate Owned Fair Value Disclosure | 2,088 | 2,604 | |
Foreclosure / OREO expense, net | (553) | (939) | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 | |||
Assets and Liabilities Measured at Fair Value on a Non-recurring Basis | |||
Impaired loans | 74,038 | 92,534 | |
Provision for Credit Losses, Impaired Loans | 14,518 | 32,159 | |
Mortgage servicing rights | 81,810 | 64,387 | |
Mortgage Servicing Rights (MSR) Impairment (Recovery) | $ 474 | $ (175) |
Fair Value Measurements Fair Value Unobservable Level 3 Measurements (Details) - Fair Value, Inputs, Level 3 |
3 Months Ended |
---|---|
Mar. 31, 2018 | |
Discounted Cash Flow | Servicing Contracts | |
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items] | |
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Discount Rate | 11.00% |
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Prepayment Speed | 9.00% |
Appraisals/Discounted Cash Flow | Impaired Finance Receivable | |
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items] | |
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Discount Rate | 28.00% |
Fair Value Measurements, Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Financial assets | ||
Cash and due from banks | $ 328,260 | $ 483,666 |
Interest-bearing deposits in other financial institutions | 94,918 | 199,702 |
Federal funds sold and securities purchased under agreements to resell | 10,000 | 32,650 |
Investment securities held to maturity | 2,443,203 | 2,282,853 |
Investment securities held to maturity, fair value | 2,407,197 | 2,283,574 |
Investment securities available for sale | 4,485,875 | 4,043,446 |
FHLB and Federal Reserve Bank stocks | 233,216 | 165,331 |
Commercial Loans Held-for-sale, Fair Value Disclosure | 6,091 | 0 |
Loans, net | 22,553,433 | 20,519,111 |
Bank and Corporate Owned Life Insurance | 657,841 | 591,057 |
Derivatives (trading and other assets) | 102,890 | 69,675 |
Financial liabilities | ||
Short-term funding | 2,146,374 | 676,282 |
Long-term funding | 3,233,338 | 3,397,450 |
Derivatives (trading and other liabilities) | 100,247 | 67,660 |
Letters of Credit Outstanding, Amount | 254,000 | 235,000 |
Fair Value, Inputs, Level 1 | ||
Financial assets | ||
Cash and due from banks | 328,260 | 483,666 |
Cash and due from banks, Fair Value | 328,260 | 483,666 |
Interest-bearing deposits in other financial institutions | 94,918 | 199,702 |
Interest-bearing deposits in other financial institutions, fair value | 94,918 | 199,702 |
Federal funds sold and securities purchased under agreements to resell | 10,000 | 32,650 |
Federal funds sold and securities purchased under agreements to resell, fair value | 10,000 | 32,650 |
Investment securities available for sale | 2,594 | 2,628 |
Investment securities available for sale, fair value | 2,594 | 2,628 |
Fair Value, Inputs, Level 2 | ||
Financial assets | ||
Investment securities held to maturity | 2,443,203 | 2,282,853 |
Investment securities held to maturity, fair value | 2,407,197 | 2,283,574 |
Investment securities available for sale | 4,483,281 | 4,040,818 |
Investment securities available for sale, fair value | 4,483,281 | 4,040,818 |
FHLB and Federal Reserve Bank stocks | 233,216 | 165,331 |
FHLB and Federal Reserve Bank stocks, fair value | 233,216 | 165,331 |
Commercial loans held for sale | 6,091 | 0 |
Commercial Loans Held-for-sale, Fair Value Disclosure | 6,091 | 0 |
Loans Receivable Held-for-sale, Net, Not Part of Disposal Group, Mortgage | 103,953 | 85,544 |
Residential Held-for-sale, Fair Value Disclosure | 103,953 | 85,544 |
Bank and Corporate Owned Life Insurance | 657,841 | 591,057 |
Bank owned life insurance, fair value | 657,841 | 591,057 |
Derivatives (trading and other assets) | 104,099 | 70,850 |
Derivatives (trading and other assets), fair value | 104,099 | 70,850 |
Financial liabilities | ||
Brokered CDs and other time deposits | 2,677,372 | 2,349,069 |
Brokered CDs and other time deposits, fair value | 2,677,372 | 2,349,069 |
Short-term funding | 2,146,374 | 676,282 |
Short-term funding, fair value | 2,146,374 | 676,282 |
Long-term funding | 3,233,338 | 3,397,450 |
Long-term funding, fair value | 3,242,517 | 3,411,368 |
Standby letters of credit | 2,468 | 2,402 |
Standby letters of credit, fair value | 2,468 | 2,402 |
Derivatives (trading and other liabilities) | 101,198 | 68,835 |
Derivatives (trading and other liabilities), fair value | 101,198 | 68,835 |
Fair Value, Inputs, Level 3 | ||
Financial assets | ||
Loans, net | 22,553,433 | 20,519,111 |
Loans, net, fair value | 22,195,415 | 20,314,984 |
Derivatives (trading and other assets) | 3,032 | 1,538 |
Derivatives (trading and other assets), fair value | 3,032 | 1,538 |
Financial liabilities | ||
Noninterest-bearing demand, savings, interest-bearing demand, and money market accounts | 21,148,230 | 20,436,893 |
Noninterest-bearing demand, savings, interest-bearing demand, and money market deposits, fair value | 21,148,230 | 20,436,893 |
Derivatives (trading and other liabilities) | 303 | 313 |
Derivatives (trading and other liabilities), fair value | $ 303 | $ 313 |
Fair Value Measurements (Details Textuals) |
3 Months Ended |
---|---|
Mar. 31, 2018 | |
Fair Value of Assets and Liabilities [Line Items] | |
Closing ratio | 85.00% |
Retirement Plans, Components of Net Periodic Benefit Cost for the Pension and Postretirement Tables (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
RAP | ||
Net period benefit cost for the pension and postretirement plans | ||
Service cost | $ 1,893 | $ 1,781 |
Interest cost | 1,660 | 1,756 |
Expected return on plan assets | (4,755) | (4,881) |
Amortization of prior service cost | (19) | (19) |
Amortization of actuarial loss | 463 | 488 |
Total net pension and periodic benefit cost | (759) | (875) |
Other Pension Plan [Member] | ||
Net period benefit cost for the pension and postretirement plans | ||
Interest cost | 433 | |
Expected return on plan assets | (532) | |
Total net pension and periodic benefit cost | (99) | |
Postretirement Plan (b) | ||
Net period benefit cost for the pension and postretirement plans | ||
Interest cost | 26 | 24 |
Amortization of prior service cost | (19) | (19) |
Amortization of actuarial loss | 2 | 0 |
Total net pension and periodic benefit cost | $ 9 | $ 5 |
Segment Reporting (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Segment Income Statement Data Abstract | ||
Net interest income | $ 209,871 | $ 180,274 |
Noninterest income | 90,380 | 79,831 |
Total revenue | 300,251 | 260,105 |
Credit provision | 0 | 9,000 |
Noninterest expense | 212,965 | 173,691 |
Income (loss) before income taxes | 87,285 | 77,414 |
Income tax expense (benefit) | 17,829 | 21,144 |
Net income | $ 69,456 | $ 56,270 |
Return on average allocated capital (ROCET1) | 11.40% | 10.60% |
Segment Balance Sheet Data | ||
Average earning assets | $ 29,282,132 | $ 26,339,314 |
Average loans | 22,078,529 | 20,072,725 |
Average deposits | 23,650,898 | 21,465,722 |
Average allocated capital (CET1) | 2,389,933 | 2,061,749 |
Operating Segments | Corporate and Commercial Specialty | ||
Segment Income Statement Data Abstract | ||
Net interest income | 95,958 | 89,388 |
Noninterest income | 12,683 | 11,993 |
Total revenue | 108,641 | 101,381 |
Credit provision | 10,598 | 11,580 |
Noninterest expense | 39,250 | 37,479 |
Income (loss) before income taxes | 58,793 | 52,322 |
Income tax expense (benefit) | 11,426 | 17,649 |
Net income | $ 47,367 | $ 34,673 |
Return on average allocated capital (ROCET1) | 16.40% | 12.60% |
Segment Balance Sheet Data | ||
Average earning assets | $ 11,389,211 | $ 10,759,811 |
Average loans | 11,378,390 | 10,753,314 |
Average deposits | 8,057,246 | 6,420,401 |
Average allocated capital (CET1) | 1,171,038 | 1,114,610 |
Operating Segments | Community, Consumer, and Business | ||
Segment Income Statement Data Abstract | ||
Net interest income | 103,543 | 88,928 |
Noninterest income | 74,036 | 64,870 |
Total revenue | 177,579 | 153,798 |
Credit provision | 4,966 | 4,507 |
Noninterest expense | 127,144 | 116,097 |
Income (loss) before income taxes | 45,469 | 33,194 |
Income tax expense (benefit) | 9,549 | 11,618 |
Net income | $ 35,920 | $ 21,576 |
Return on average allocated capital (ROCET1) | 23.00% | 15.20% |
Segment Balance Sheet Data | ||
Average earning assets | $ 10,137,899 | $ 9,130,457 |
Average loans | 10,133,202 | 9,128,656 |
Average deposits | 13,096,782 | 11,337,064 |
Average allocated capital (CET1) | 632,723 | 576,464 |
Operating Segments | Risk Management and Shared Services | ||
Segment Income Statement Data Abstract | ||
Net interest income | 10,370 | 1,958 |
Noninterest income | 3,661 | 2,968 |
Total revenue | 14,031 | 4,926 |
Credit provision | (15,563) | (7,087) |
Noninterest expense | 46,571 | 20,115 |
Income (loss) before income taxes | (16,977) | (8,102) |
Income tax expense (benefit) | (3,146) | (8,123) |
Net income | $ (13,831) | $ 21 |
Return on average allocated capital (ROCET1) | (11.20%) | (2.50%) |
Segment Balance Sheet Data | ||
Average earning assets | $ 7,755,022 | $ 6,449,046 |
Average loans | 566,936 | 190,755 |
Average deposits | 2,496,870 | 3,708,257 |
Average allocated capital (CET1) | $ 586,172 | $ 370,675 |
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | $ (62,758) | |
Personnel expense | 117,685 | $ 106,782 |
Change in Equity Securities(2016-01) | 84 | |
Interest income (amortization of net unrealized losses (gains) on available for sale securities transferred to held to maturity securities) | (297) | (1,027) |
Total other comprehensive income (loss) | 44,915 | 1,665 |
Ending Balance | (107,673) | |
Investment Securities Available For Sale | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | (38,453) | (20,079) |
Other comprehensive income (loss) before reclassifications | 41,834 | (2,112) |
Investment securities gain, net | 0 | |
Personnel expense | 0 | 0 |
Other Expenses | 0 | 0 |
Change in Equity Securities(2016-01) | (84) | |
Reporting Comprehensive Income(2018-02) | (8,419) | |
Interest income (amortization of net unrealized losses (gains) on available for sale securities transferred to held to maturity securities) | (297) | 1,027 |
Income tax (expense) benefit | 10,635 | (1,195) |
Total other comprehensive income (loss) | (40,000) | 1,944 |
Ending Balance | (78,453) | (22,023) |
Defined Benefit Pension and Post Retirement Obligations | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | (24,305) | (34,600) |
Other comprehensive income (loss) before reclassifications | 0 | 0 |
Investment securities gain, net | 0 | |
Personnel expense | (38) | 38 |
Other Expenses | 465 | (488) |
Change in Equity Securities(2016-01) | 0 | |
Reporting Comprehensive Income(2018-02) | (5,235) | |
Interest income (amortization of net unrealized losses (gains) on available for sale securities transferred to held to maturity securities) | 0 | 0 |
Income tax (expense) benefit | (107) | 171 |
Total other comprehensive income (loss) | (4,915) | (279) |
Ending Balance | (29,220) | (34,321) |
Accumulated Other Comprehensive Income (Loss) | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning Balance | (62,758) | (54,679) |
Other comprehensive income (loss) before reclassifications | 41,834 | (2,112) |
Investment securities gain, net | 0 | |
Personnel expense | (38) | 38 |
Other Expenses | 465 | (488) |
Change in Equity Securities(2016-01) | (84) | |
Reporting Comprehensive Income(2018-02) | (13,654) | |
Interest income (amortization of net unrealized losses (gains) on available for sale securities transferred to held to maturity securities) | (297) | 1,027 |
Income tax (expense) benefit | 10,528 | (1,024) |
Total other comprehensive income (loss) | (44,915) | (1,665) |
Ending Balance | $ (107,673) | $ (56,344) |
Revenues (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | $ 72,725 | $ 64,881 |
Noninterest Income (out-of-scope of Topic 606) | 17,655 | 14,950 |
Total noninterest income | 90,380 | 79,831 |
Insurance commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 22,648 | 21,620 |
Service charges and deposit account fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 16,420 | 16,356 |
Card-based and loan fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 9,869 | 8,421 |
Trust and asset management fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 13,369 | 11,935 |
Brokerage commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 7,273 | 4,333 |
Other revenue | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 3,146 | 2,216 |
Corporate and Commercial Specialty | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 5,195 | 4,757 |
Noninterest Income (out-of-scope of Topic 606) | 7,488 | 7,236 |
Total noninterest income | 12,683 | 11,993 |
Corporate and Commercial Specialty | Insurance commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 0 | 0 |
Corporate and Commercial Specialty | Service charges and deposit account fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 4,225 | 4,441 |
Corporate and Commercial Specialty | Card-based and loan fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 315 | 272 |
Corporate and Commercial Specialty | Trust and asset management fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 0 | 0 |
Corporate and Commercial Specialty | Brokerage commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 0 | 0 |
Corporate and Commercial Specialty | Other revenue | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 655 | 44 |
Community, Consumer, and Business | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 67,198 | 60,040 |
Noninterest Income (out-of-scope of Topic 606) | 6,838 | 4,830 |
Total noninterest income | 74,036 | 64,870 |
Community, Consumer, and Business | Insurance commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 22,624 | 21,620 |
Community, Consumer, and Business | Service charges and deposit account fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 12,183 | 11,889 |
Community, Consumer, and Business | Card-based and loan fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 9,529 | 8,144 |
Community, Consumer, and Business | Trust and asset management fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 13,369 | 11,935 |
Community, Consumer, and Business | Brokerage commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 7,032 | 4,333 |
Community, Consumer, and Business | Other revenue | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 2,461 | 2,119 |
Risk Management and Shared Services | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 332 | 84 |
Noninterest Income (out-of-scope of Topic 606) | 3,329 | 2,884 |
Total noninterest income | 3,661 | 2,968 |
Risk Management and Shared Services | Insurance commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 24 | 0 |
Risk Management and Shared Services | Service charges and deposit account fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 12 | 26 |
Risk Management and Shared Services | Card-based and loan fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 25 | 5 |
Risk Management and Shared Services | Trust and asset management fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 0 | 0 |
Risk Management and Shared Services | Brokerage commissions and fees | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | 241 | 0 |
Risk Management and Shared Services | Other revenue | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Noninterest Income (in-scope of Topic 606) | $ 30 | $ 53 |
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