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Loans and Leases
 3 Months Ended
Mar. 31, 2020
Loans and Leases Receivable Disclosure [Abstract]  
Loans and Leases Loans and Leases
The following table summarizes loans and leases:
(In thousands)At March 31,
2020		At December 31, 2019
Commercial non-mortgage$5,838,673  $5,296,611  
Asset-based1,180,328  1,046,886  
Commercial real estate6,122,474  5,949,339  
Equipment financing546,946  537,341  
Total commercial portfolio13,688,421  12,830,177  
Residential4,991,512  4,972,685  
Home equity1,992,372  2,014,544  
Other consumer219,219  219,580  
Total consumer portfolio7,203,103  7,206,809  
Loans and leases (1) (2) (3)
$20,891,524  $20,036,986  
(1)Loan balances include net deferred fees/costs and net premiums/discounts of $19.7 million and $17.6 million at March 31, 2020 and December 31, 2019, respectively.
(2)At March 31, 2020 the Company had pledged $7.7 billion of eligible loans as collateral to support borrowing capacity at the Federal Home Loan Bank (FHLB) of Boston and the Federal Reserve Bank (FRB) of Boston.
(3)Loan balances exclude accrued interest receivable of $61.5 million and $59.0 million at March 31, 2020 and December 31, 2019, respectively, which is included in accrued interest and other assets in the consolidated balance sheet.
Equipment financing includes net investment in leases of $179.1 million at March 31, 2020. Total undiscounted cash flows to be received from the Company's net investment in leases are $194.5 million at March 31, 2020 and are primarily due within the next five years. The Company's lessor activity has recognized interest income of $1.5 million and $1.4 million for the three months ended March 31, 2020 and 2019, respectively.
Loans and Leases Aging
The following tables summarize the aging of loans and leases:
 At March 31, 2020
(In thousands)30-59 Days
Past Due and
Accruing		60-89 Days
Past Due and
Accruing		90 or More Days Past Due
and Accruing		Non-accrualTotal Past Due and Non-accrualCurrentTotal Loans
and Leases
Commercial non-mortgage$3,303  $515  $75  $65,139  $69,032  $5,769,641  $5,838,673  
Asset-based—  —  —  137  137  1,180,191  1,180,328  
Commercial real estate2,222  —  —  12,910  15,132  6,107,342  6,122,474  
Equipment financing3,922  483  —  8,950  13,355  533,591  546,946  
Residential7,603  4,232  —  42,465  54,300  4,937,212  4,991,512  
Home equity8,230  4,462  —  31,796  44,488  1,947,884  1,992,372  
Other consumer1,230  791  —  1,033  3,054  216,165  219,219  
Total$26,510  $10,483  $75  $162,430  $199,498  $20,692,026  $20,891,524  

 At December 31, 2019
(In thousands)30-59 Days
Past Due and
Accruing		60-89 Days
Past Due and
Accruing		90 or More Days Past Due
and Accruing		Non-accrualTotal Past Due and Non-accrualCurrentTotal Loans
and Leases
Commercial non-mortgage$2,094  $617  $—  $59,369  $62,080  $5,234,531  $5,296,611  
Asset-based—  —  —  139  139  1,046,747  1,046,886  
Commercial real estate1,256  454  —  11,563  13,273  5,936,066  5,949,339  
Equipment financing5,493  292  —  5,433  11,218  526,123  537,341  
Residential7,166  6,441  —  43,193  56,800  4,915,885  4,972,685  
Home equity8,267  5,551  —  30,170  43,988  1,970,556  2,014,544  
Other consumer4,269  807  —  1,192  6,268  213,312  219,580  
Total$28,545  $14,162  $—  $151,059  $193,766  $19,843,220  $20,036,986  
The following table provides additional detail related to loans and leases on non-accrual status:
At March 31, 2020At December 31, 2019
(In thousands)NonaccrualNonaccrual With No AllowanceNonaccrualNonaccrual With No Allowance
Commercial non-mortgage$65,139  $33,604  $59,369  $13,584  
Asset-based137  —  139  —  
Commercial real estate12,910  5,654  11,563  4,717  
Equipment financing8,950  564  5,433  2,159  
Total commercial portfolio87,136  39,822  76,504  20,460  
Residential42,465  33,779  43,193  19,271  
Home equity31,796  24,159  30,170  15,195  
Other consumer1,033  65  1,192  —  
Total consumer portfolio75,294  58,003  74,555  34,466  
Total $162,430  $97,825  $151,059  $54,926  
Interest income on non-accrual loans for the three months ended March 31, 2020 and the three months ended March 31, 2019 for residential was $0.3 million for both periods and for home equity was $0.5 million and $0.4 million, respectively.
Interest on non-accrual loans and leases that would have been recorded as additional interest income had the loans and leases been current in accordance with the original terms totaled $3.3 million and $3.0 million for the three months ended March 31, 2020 and 2019, respectively.
Refer to Note 1 to the Consolidated Financial Statements included in the Company's Form 10-K, for the year ended December 31, 2019, for details of non-accrual policies.
Allowance for Credit Losses on Loans and Leases
The following tables summarize the activity in, as well as the loan and lease balances that were evaluated for, ACL on loans and leases:
 At or for the three months ended March 31, 2020At or for the three months ended March 31, 2019
(In thousands)Commercial PortfolioConsumer PortfolioTotalCommercial PortfolioConsumer PortfolioTotal
ACL on loans and leases:
Balance, beginning of period$161,669  $47,427  $209,096  $164,073  $48,280  $212,353  
Adoption of ASU No. 2016-13 (CECL)34,024  23,544  57,568  —  —  —  
Provision charged to expense71,243  4,842  76,085  7,990  610  8,600  
Charge-offs(5,574) (4,587) (10,161) (8,810) (4,223) (13,033) 
Recoveries564  1,779  2,343  804  2,665  3,469  
Balance, end of period$261,926  $73,005  $334,931  $164,057  $47,332  $211,389  
Individually evaluated for impairment$8,235  $4,777  $13,012  $8,262  $5,543  $13,805  
Collectively evaluated for impairment$253,691  $68,228  $321,919  $155,795  $41,789  $197,584  
Loan and lease balances:
Individually evaluated for impairment$177,012  $155,105  $332,117  $133,203  $141,173  $274,376  
Collectively evaluated for impairment13,511,409  7,047,998  20,559,407  11,709,564  6,830,350  18,539,914  
Loans and leases$13,688,421  $7,203,103  $20,891,524  $11,842,767  $6,971,523  $18,814,290  
Credit Quality Indicators. To measure credit risk for the commercial, commercial real estate, and equipment financing portfolios, the Company employs a dual grade credit risk grading system for estimating the PD and the LGD. The Company's credit risk grading system has not changed with the adoption of CECL. The credit risk grade system assigns a rating to each borrower and to the facility, which together form a Composite Credit Risk Profile. The credit risk grade system categorizes borrowers by common financial characteristics that measure the credit strength of borrowers and facilities by common structural characteristics. The Composite Credit Risk Profile has ten grades, with each grade corresponding to a progressively greater risk of loss. Grades (1)-(6) are considered pass ratings, and (7)-(10) are considered criticized as defined by the regulatory agencies. Risk ratings, assigned to differentiate risk within the portfolio, are reviewed on an ongoing basis and revised to reflect changes in a borrowers’ current financial position and outlook, risk profile, and the related collateral and structural position. Loan officers review updated financial information on at least an annual basis for all pass rated loans to assess the accuracy of the risk grade. Criticized loans undergo more frequent reviews and enhanced monitoring.
A (7) "Special Mention" credit has the potential weakness that, if left uncorrected, may result in deterioration of the repayment prospects for the asset. A (8) "Substandard" asset has a well-defined weakness that jeopardizes the full repayment of the debt. An asset rated (9) "Doubtful" has all of the same weaknesses as a substandard credit with the added characteristic that the weakness makes collection or liquidation in full, given current facts, conditions, and values, improbable. Assets classified as (10) "Loss" in accordance with regulatory guidelines are considered uncollectible and charged off.
For residential and consumer loans, the most relevant credit characteristic is FICO score. FICO scores are a widely used credit score and range from 300 to 850. A lower FICO score is indicative of higher credit risk. FICO scores are updated at least quarterly.
The following table summarizes commercial, commercial real estate, and equipment financing loans and leases segregated by origination year and risk rating exposure under the Composite Credit Risk Profile grades as of March 31, 2020:
(In thousands)20202019201820172016PriorRevolving Loans Amortized Cost BasisTotal
Commercial non-mortgage
Pass$430,104  $1,385,259  $1,117,948  $608,794  $324,107  $334,448  $1,322,658  $5,523,318  
Special mention—  12,935  7,306  15,837  —  9,014  3,703  48,795  
Substandard1,014  35,271  40,267  55,992  22,609  40,292  67,257  262,702  
Doubtful—  3,378  —  480  —  —  —  3,858  
Total commercial non-mortgage431,118  1,436,843  1,165,521  681,103  346,716  383,754  1,393,618  5,838,673  
Asset-based
Pass—  24,171  21,757  14,218  11,445  24,754  1,011,753  1,108,098  
Special mention—  2,333  850  —  —  1,613  32,686  37,482  
Substandard—  —  —  —  —  —  34,748  34,748  
Total asset-based—  26,504  22,607  14,218  11,445  26,367  1,079,187  1,180,328  
Commercial real estate
Pass319,742  1,493,595  1,304,836  671,838  678,616  1,521,662  41,126  6,031,415  
Special mention—  —  22,684  3,865  567  3,240  —  30,356  
Substandard—  —  529  23,053  2,178  34,943  —  60,703  
Total commercial real estate319,742  1,493,595  1,328,049  698,756  681,361  1,559,845  41,126  6,122,474  
Equipment financing
Pass58,694  195,860  104,696  46,139  70,410  38,836  —  514,635  
Special mention45  4,209  4,515  —  302  262  —  9,333  
Substandard163  1,324  6,358  3,014  5,232  6,887  —  22,978  
Total equipment financing58,902  201,393  115,569  49,153  75,944  45,985  —  546,946  
Total commercial portfolio$809,762  $3,158,335  $2,631,746  $1,443,230  $1,115,466  $2,015,951  $2,513,931  $13,688,421  
The following table summarizes residential and consumer loans segregated by origination year and risk rating exposure under FICO score groupings as of March 31, 2020:
(In thousands)20202019201820172016PriorRevolving Loans Amortized Cost BasisTotal
Residential
800+$22,988  $317,512  $84,511  $246,445  $342,342  $1,024,460  $—  $2,038,258  
740-79985,134  477,768  106,474  223,136  234,160  667,180  —  1,793,852  
670-73933,038  199,222  64,161  106,085  108,279  334,075  —  844,860  
580-669856  32,110  11,471  13,141  19,061  121,294  —  197,933  
579 and below—  24,367  412  4,967  4,684  82,179  —  116,609  
Total residential142,016  1,050,979  267,029  593,774  708,526  2,229,188  —  4,991,512  
Home equity
800+3,447  17,876  32,108  19,123  18,729  73,163  548,752  713,198  
740-7995,357  20,881  27,965  16,554  17,693  55,972  481,738  626,160  
670-7394,416  13,677  16,389  12,336  10,556  56,375  337,893  451,642  
580-669341  2,938  3,474  3,038  2,943  21,931  104,333  138,998  
579 and below49  738  1,303  1,108  732  13,607  44,837  62,374  
Total home equity13,610  56,110  81,239  52,159  50,653  221,048  1,517,553  1,992,372  
Other consumer
800+1,293  3,920  2,689  791  197  238  7,329  16,457  
740-7997,752  23,298  14,404  2,638  956  681  3,472  53,201  
670-73918,745  62,579  29,506  7,793  3,425  2,239  6,993  131,280  
580-6691,839  5,395  2,798  1,212  578  581  2,227  14,630  
579 and below410  613  425  121  84  262  1,736  3,651  
Total other consumer30,039  95,805  49,822  12,555  5,240  4,001  21,757  219,219  
Total consumer portfolio185,665  1,202,894  398,090  658,488  764,419  2,454,237  1,539,310  7,203,103  
Total commercial portfolio809,762  3,158,335  2,631,746  1,443,230  1,115,466  2,015,951  2,513,931  13,688,421  
Total loans and leases$995,427  $4,361,229  $3,029,836  $2,101,718  $1,879,885  $4,470,188  $4,053,241  $20,891,524  
Individually Assessed Loans and Leases
The following tables summarize individually assessed loans and leases (At December 31, 2019, partially charged-off consumer loans and leases were included in collectively evaluated for impairment):
 At March 31, 2020
(In thousands)Unpaid
Principal
Balance		Amortized CostAmortized Cost No AllowanceAmortized Cost With AllowanceRelated
Valuation
Allowance
Commercial non-mortgage$188,458  $143,415  $53,032  $90,383  $6,527  
Asset-based463  137  —  137  3  
Commercial real estate30,540  24,509  15,699  8,810  1,044  
Equipment financing9,063  8,951  549  8,402  661  
Residential119,579  105,460  68,788  36,672  3,438  
Home equity114,212  48,612  35,606  13,006  1,137  
Other consumer2,675  1,033  65  968  202  
Total$464,990  $332,117  $173,739  $158,378  $13,012  

 At December 31, 2019
(In thousands)Unpaid
Principal
Balance		Amortized CostAmortized Cost No AllowanceAmortized Cost With AllowanceRelated
Valuation
Allowance
Commercial non-mortgage$140,096  $102,254  $29,739  $72,515  $7,862  
Asset-based465  139  —  139  5  
Commercial real estate29,292  23,297  14,818  8,479  1,143  
Equipment financing5,591  5,433  2,159  3,274  418  
Residential98,790  90,096  56,231  33,865  3,618  
Home equity38,503  35,191  27,672  7,519  1,203  
Other consumer—  —  —  —  —  
Total$312,737  $256,410  $130,619  $125,791  $14,249  
The following table summarizes the average amortized cost and interest income recognized for individually assessed loans and leases:
Three months ended March 31,
20202019
(In thousands)Average
Amortized Cost		Accrued
Interest
Income		Cash Basis Interest Income Average
Amortized Cost		Accrued
Interest
Income		Cash Basis Interest Income
Commercial non-mortgage$122,835  $1,053  $—  $107,529  $920  $—  
Asset-based138  —  —  222  —  —  
Commercial real estate23,903  146  —  11,544  73  —  
Equipment financing7,192  —  —  5,634  —  —  
Residential97,778  830  630  102,926  908  264  
Home equity41,902  391  830  38,998  269  280  
Other consumer512  17  —  —  —  —  
Total$294,260  $2,437  $1,460  $266,853  $2,170  $544  
Collateral Dependent Loans and Leases. The ACL on loans and leases specific to collateral dependent loans is individually assessed based on the fair value of the collateral, less costs to sell, as of the reporting date. A loan is considered collateral dependent when the borrower is experiencing financial difficulty and when the loan is expected to be repaid substantially through the sale or operation of the collateral. Commercial non-mortgage, asset based, and equipment financing are collateralized by equipment, inventory, receivables, or other non-real estate assets. Commercial real estate, residential, and home equity are collateralized by real estate.
The following table summarizes whether, or not, individually assessed loans and leases are collateral dependent:
March 31, 2020December 31, 2019
(In thousands)Collateral DependentNot Considered Collateral DependentTotalCollateral DependentNot Considered Collateral DependentTotal
Commercial non-mortgage$21,219  $122,196  $143,415  $10,682  $91,572  $102,254  
Asset-based—  137  137  —  139  139  
Commercial real estate20,157  4,352  24,509  14,097  9,200  23,297  
Equipment financing—  8,951  8,951  —  5,433  5,433  
Residential36,663  68,797  105,460  17,635  72,461  90,096  
Home equity27,987  20,625  48,612  17,136  18,055  35,191  
Other consumer—  1,033  1,033  —  —  —  
Total amortized cost of CDA$106,026  $226,091  $332,117  $59,550  $196,860  $256,410  
Collateral value$362,368  $362,368  $109,810  $109,810  
Troubled Debt Restructurings
The following table summarizes information for TDRs:
(In thousands)At March 31,
2020		At December 31, 2019
Accrual status$157,235  $136,449  
Non-accrual status100,892  100,989  
Total TDRs$258,127  $237,438  
Specific reserves for TDRs included in the balance of ACL on loans and leases$11,984  $12,956  
Additional funds committed to borrowers in TDR status6,949  4,856  
For the portion of TDRs deemed to be uncollectible, Webster charged off $1.2 million and $1.4 million for the three months ended March 31, 2020 and 2019, respectively.
The following table provides information on the type of concession for loans and leases modified as TDRs:
Three months ended March 31,
20202019
Number of
Loans and
Leases
Post-
Modification
Recorded
Investment(1)
Number of
Loans and
Leases
Post-
Modification
Recorded
Investment(1)
(Dollars in thousands)
Commercial non-mortgage
Extended Maturity2$104  2$124  
Maturity/Rate Combined5274  125  
Other (2)
1027,137  1522,027  
Commercial real estate
Extended Maturity——  ——  
Maturity/Rate Combined1278  ——  
Other (2)
——  22,636  
Residential
Extended Maturity1264  1519  
Maturity/Rate Combined3443  5451  
Other (2)
3613  2261  
Consumer
Extended Maturity——  2145  
Maturity/Rate Combined113  ——  
Other (2)
111,113  13754  
Total TDRs37$30,239  43$26,942  
(1)Post-modification balances approximate pre-modification balances. The aggregate amount of charge-offs as a result of the restructurings was not significant.
(2)Other includes covenant modifications, forbearance, loans discharged under Chapter 7 bankruptcy, or other concessions.
There were no significant amounts of loans and leases modified as TDRs within the previous 12 months and for which there was a payment default for the three months ended March 31, 2020 and 2019, respectively.
TDRs in commercial, commercial real estate, and equipment financing segregated by risk rating exposure is as follows:
(In thousands)At March 31, 2020At December 31, 2019
(1) - (6) Pass$4,125  $3,952  
(7) Special Mention59  63  
(8) Substandard129,525  104,277  
(9) Doubtful3,857  3,860  
Total$137,566  $112,152