LOANS AND LEASES

The Company’s loan and lease portfolio includes originated and purchased loans and leases. Originated loans and leases and purchased loans and leases, in each case, for which there was no evidence of credit deterioration at their acquisition date and it was probable that we would be able to collect all contractually required payments, are referred to collectively as non-purchased credit impaired loans, or "Non-PCI loans." Purchased loans for which there was, at the acquisition date, evidence of credit deterioration since their origination and it was probable that we would be unable to collect all contractually required payments are referred to as purchased credit impaired loans, or "PCI loans".

Non-PCI loans are carried at the principal amount outstanding, net of deferred fees and costs, and in the case of acquired loans, net of purchase discounts and premiums. Deferred fees and costs and purchase discounts and premiums on acquired non-impaired loans are recognized as an adjustment to interest income over the contractual life of the loans using the effective interest method or taken into income when the related loans are paid off or sold.

PCI loans are accounted for in accordance with ASC Subtopic 310‑30, “Loans and Debt Securities Acquired with Deteriorated Credit Quality.” For PCI loans, at the time of acquisition we (i) calculate the contractual amount and timing of undiscounted principal and interest payments (the "undiscounted contractual cash flows") and (ii) estimate the amount and timing of undiscounted expected principal and interest payments (the "undiscounted expected cash flows"). The difference between the undiscounted contractual cash flows and the undiscounted expected cash flows is the nonaccretable difference. The difference between the undiscounted cash flows expected to be collected and the estimated fair value of the acquired loans is the accretable yield. The nonaccretable difference represents an estimate of the loss exposure of principal and interest related to the PCI loan portfolios; such amount is subject to change over time based on the performance of such loans. The carrying value of PCI loans is reduced by payments received, both principal and interest, and increased by the portion of the accretable yield recognized as interest income.

In the CapitalSource Inc. merger, the estimated fair value of the loans and leases acquired, excluding PCI loans, was $6.8 billion, the related gross contractual cash flows was $9.4 billion, and the estimated contractual cash flows not expected to be collected was $839.8 million. The estimated fair value of loans acquired that were identified as PCI loans was $79.2 million.

The following table summarizes the composition of our loan and lease portfolio as of the dates indicated:



	December 31, 2014									December 31, 2013
	Non-PCI									Non-PCI
	Loans			PCI						Loans			PCI
	and Leases			Loans			Total			and Leases			Loans			Total
	(In thousands)
Real estate mortgage	$	5,350,827		$	256,489		$	5,607,316		$	2,424,864		$	371,134		$	2,795,998
Real estate construction	309,162			6,924			316,086			209,090			10,427			219,517
Commercial	5,852,420			27,155			5,879,575			1,241,776			974			1,242,750
Consumer	101,423			284			101,707			54,809			261			55,070
Total gross loans and leases	11,613,832			290,852			11,904,684			3,930,539			382,796			4,313,335
Deferred fees and costs	(22,191		)	(61		)	(22,252		)	(983		)	—			(983		)
Total loans and leases, net of unearned income	11,591,641			290,791			11,882,432			3,929,556			382,796			4,312,352
Allowance for loan and lease losses	(70,456		)	(13,999		)	(84,455		)	(60,241		)	(21,793		)	(82,034		)
Total net loans and leases	$	11,521,185		$	276,792		$	11,797,977		$	3,869,315		$	361,003		$	4,230,318

The following table presents a summary of the activity in the allowance for credit losses on Non‑PCI loans and leases for the years indicated:



	Components						Total
	Non-PCI			Non-PCI			Non-PCI
	Allowance for			Reserve for			Allowance
	Loan and lease			Unfunded Loan			for Credit
	Losses			Commitments			Losses
	(In thousands)
Balance, December 31, 2011	$	85,313		$	8,470		$	93,783
Charge-offs	(13,070		)	—			(13,070		)
Recoveries	3,406			—			3,406
Negative provision	(9,750		)	(2,250		)	(12,000		)
Balance, December 31, 2012	65,899			6,220			72,119
Charge-offs	(11,159		)	—			(11,159		)
Recoveries	6,856			—			6,856
(Negative provision ) provision	(1,355		)	1,355			—
Balance, December 31, 2013	60,241			7,575			67,816
Charge-offs	(11,875		)	—			(11,875		)
Recoveries	10,344			—			10,344
(Negative provision) provision	11,746			(1,264		)	10,482
Balance, December 31, 2014	$	70,456		$	6,311		$	76,767

The following tables present a summary of the activity in the allowance for loan and lease losses on Non‑PCI loans and leases by portfolio segment and PCI loans for the years indicated:



	Year Ended December 31, 2014
	Real Estate Mortgage			Real Estate Construction			Commercial			Consumer			Total Non-PCI			Total PCI			Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of year	$	26,078		$	4,298		$	26,921		$	2,944		$	60,241		$	21,793		$	82,034
Charge-offs	(2,080		)	—			(9,463		)	(332		)	(11,875		)	(9,577		)	(21,452		)
Recoveries	2,640			156			6,265			1,283			10,344			766			11,110
Provision (negative provision)	(1,541		)	(206		)	16,135			(2,642		)	11,746			1,017			12,763
Balance, end of year	$	25,097		$	4,248		$	39,858		$	1,253		$	70,456		$	13,999		$	84,455

Amount of the allowance applicable to loans and leases:
Individually evaluated for impairment	$	693		$	69		$	9,975		$	37		$	10,774
Collectively evaluated for impairment	$	24,404		$	4,179		$	29,883		$	1,216		$	59,682
Acquired loans with deteriorated credit quality																$	13,999
Loan and Leases:
Ending balance⁽¹⁾	$	5,340,560		$	307,135		$	5,842,463		$	101,483		$	11,591,641		$	290,791		$	11,882,432
The ending balance of the loan and lease portfolio is composed of loans and leases:
Individually evaluated for impairment	$	57,857		$	10,555		$	46,709		$	3,744		$	118,865
Collectively evaluated for impairment	$	5,282,703		$	296,580		$	5,795,754		$	97,739		$	11,472,776
Acquired loans with deteriorated credit quality																$	290,791

_________________________


(1)	As of December 31, 2014, the amounts of loans covered by loss sharing provisions of FDIC loss sharing agreements in the Non-PCI and PCI categories were $61.5 million and $100.4 million.



	Year Ended December 31, 2013
	Real Estate Mortgage			Real Estate Construction			Commercial			Consumer			Total Non-PCI			Total PCI			Total
	(In thousands)
Allowance for loan and lease losses:
Balance, beginning of year	$	38,700		$	3,221		$	22,252		$	1,726		$	65,899		$	26,069		$	91,968
Charge-offs	(4,552		)	—			(6,409		)	(198		)	(11,159		)	(66		)	(11,225		)
Recoveries	2,507			1,654			2,621			74			6,856			—			6,856
Provision (negative provision)	(10,577		)	(577		)	8,457			1,342			(1,355		)	(4,210		)	(5,565		)
Balance, end of year	$	26,078		$	4,298		$	26,921		$	2,944		$	60,241		$	21,793		$	82,034

Amount of the allowance applicable to loans and leases:
Individually evaluated for impairment	$	2,188		$	169		$	5,003		$	240		$	7,600
Collectively evaluated for impairment	$	23,890		$	4,129		$	21,918		$	2,704		$	52,641
Acquired loans with deteriorated credit quality																$	21,793
Loan and Leases:
Ending balance⁽¹⁾	$	2,422,107		$	207,779		$	1,244,785		$	54,885		$	3,929,556		$	382,796		$	4,312,352
The ending balance of the loan and lease portfolio is composed of loans and leases:
Individually evaluated for impairment	$	62,276		$	7,512		$	17,932		$	702		$	88,422
Collectively evaluated for impairment	$	2,359,831		$	200,267		$	1,226,853		$	54,183		$	3,841,134
Acquired loans with deteriorated credit quality																$	382,796

_________________________


(1)	As of December 31, 2013, the amounts of loans covered by loss sharing provisions of FDIC loss sharing agreements in the Non-PCI and PCI categories were $85.9 million and $362.5 million.

Non‑Purchased Credit Impaired (Non‑PCI) Loans and Leases

The following table presents the credit risk rating categories for Non‑PCI loans and leases by portfolio segment and class as of the dates indicated. Nonclassified loans and leases are those with a credit risk rating of either pass or special mention, while classified loans and leases are those with a credit risk rating of either substandard or doubtful.



	December 31, 2014						December 31, 2013
	Classified		Nonclassified		Total		Classified		Nonclassified		Total
	(In thousands)
Real estate mortgage:
Hospitality	$	17,761	$	542,458	$	560,219	$	12,337	$	168,216	$	180,553
SBA	11,141		364,786		375,927		5,297		39,869		45,166
Other	68,084		4,336,330		4,404,414		64,279		2,132,109		2,196,388
Total real estate mortgage	96,986		5,243,574		5,340,560		81,913		2,340,194		2,422,107
Real estate construction:
Residential	402		96,326		96,728		750		58,131		58,881
Commercial	3,346		207,061		210,407		6,291		142,607		148,898
Total real estate construction	3,748		303,387		307,135		7,041		200,738		207,779
Commercial:
Collateralized	22,433		416,754		439,187		18,838		567,643		586,481
Unsecured	1,323		130,501		131,824		1,856		151,896		153,752
Asset-based	11,547		1,783,304		1,794,851		6,859		195,569		202,428
Cash flow	83,321		2,376,530		2,459,851		—		—		—
Equipment finance	15,973		953,516		969,489		632		272,851		273,483
SBA	3,207		44,054		47,261		5,761		22,880		28,641
Total commercial	137,804		5,704,659		5,842,463		33,946		1,210,839		1,244,785
Consumer	4,073		97,410		101,483		4,411		50,474		54,885
Total Non-PCI loans and leases	$	242,611	$	11,349,030	$	11,591,641	$	127,311	$	3,802,245	$	3,929,556

In addition to our internal risk rating process, our federal and state banking regulators, as an integral part of their examination process, periodically review the Company’s loan risk rating classifications. Our regulators may require the Company to recognize rating downgrades based on their judgments related to information available to them at the time of their examinations. Risk rating downgrades generally result in increases in the provisions for credit losses and the allowance for credit losses.

The following tables present an aging analysis of our Non‑PCI loans and leases by portfolio segment and class as of the dates indicated:



	December 31, 2014
	30-89 Days Past Due		90 or More Days Past Due		Total Past Due		Current		Total Loans
	(In thousands)
Real estate mortgage:
Hospitality	$	—	$	—	$	—	$	560,219	$	560,219
SBA	5,530		4,357		9,887		366,040		375,927
Other	6,098		7,630		13,728		4,390,686		4,404,414
Total real estate mortgage	11,628		11,987		23,615		5,316,945		5,340,560
Real estate construction:
Residential	—		—		—		96,728		96,728
Commercial	—		715		715		209,692		210,407
Total real estate construction	—		715		715		306,420		307,135
Commercial:
Collateralized	878		965		1,843		437,344		439,187
Unsecured	69		45		114		131,710		131,824
Asset-based	—		—		—		1,794,851		1,794,851
Cash flow	—		232		232		2,459,619		2,459,851
Equipment finance	6,525		366		6,891		962,598		969,489
SBA	205		1,362		1,567		45,694		47,261
Total commercial	7,677		2,970		10,647		5,831,816		5,842,463
Consumer	101		3,146		3,247		98,236		101,483
Total Non-PCI loans and leases	$	19,406	$	18,818	$	38,224	$	11,553,417	$	11,591,641



	December 31, 2013
	30-89 Days Past Due		90 or More Days Past Due		Total Past Due		Current		Total Loans
	(In thousands)
Real estate mortgage:
Hospitality	$	—	$	—	$	—	$	180,553	$	180,553
SBA	2,564		—		2,564		42,602		45,166
Other	13,026		2,406		15,432		2,180,956		2,196,388
Total real estate mortgage	15,590		2,406		17,996		2,404,111		2,422,107
Real estate construction:
Residential	—		—		—		58,881		58,881
Commercial	—		2,013		2,013		146,885		148,898
Total real estate construction	—		2,013		2,013		205,766		207,779
Commercial:
Collateralized	473		259		732		585,749		586,481
Unsecured	83		68		151		153,601		153,752
Asset-based	—		—		—		202,428		202,428
Equipment finance	2,662		244		2,906		270,577		273,483
SBA	1,770		243		2,013		26,628		28,641
Total commercial	4,988		814		5,802		1,238,983		1,244,785
Consumer	3,319		—		3,319		51,566		54,885
Total Non-PCI loans and leases	$	23,897	$	5,233	$	29,130	$	3,900,426	$	3,929,556

At December 31, 2014 and 2013, the Company had no loans and leases (excluding PCI loans) that were greater than 90 days past due and still accruing interest. It is the Company’s policy to discontinue accruing interest when principal or interest payments are past due 90 days or more unless the loan is both well secured and in the process of collection or when, in the opinion of management, there is a reasonable doubt as to the collectability of a loan or lease in the normal course of business. For 2014, the amount of interest income that would have been recorded on nonaccrual loans and leases at December 31, 2014 had such loans and leases been current in accordance with their original terms was $7.5 million.

The following table presents our nonaccrual and performing Non‑PCI loans and leases by portfolio segment and class as of the dates indicated:



	December 31, 2014						December 31, 2013
	Nonaccrual		Performing		Total		Nonaccrual		Performing		Total
	(In thousands)
Real estate mortgage:
Hospitality	$	6,366	$	553,853	$	560,219	$	6,723	$	173,830	$	180,553
SBA	11,141		364,786		375,927		2,602		42,564		45,166
Other	20,105		4,384,309		4,404,414		18,648		2,177,740		2,196,388
Total real estate mortgage	37,612		5,302,948		5,340,560		27,973		2,394,134		2,422,107
Real estate construction:
Residential	381		96,347		96,728		389		58,492		58,881
Commercial	1,178		209,229		210,407		2,830		146,068		148,898
Total real estate construction	1,559		305,576		307,135		3,219		204,560		207,779
Commercial:
Collateralized	5,450		433,737		439,187		9,991		576,490		586,481
Unsecured	639		131,185		131,824		458		153,294		153,752
Asset-based	4,574		1,790,277		1,794,851		1,070		201,358		202,428
Cash flow	15,964		2,443,887		2,459,851		—		—		—
Equipment finance	11,131		958,358		969,489		632		272,851		273,483
SBA	3,207		44,054		47,261		3,037		25,604		28,641
Total commercial	40,965		5,801,498		5,842,463		15,188		1,229,597		1,244,785
Consumer	3,485		97,998		101,483		394		54,491		54,885
Total Non-PCI loans and leases	$	83,621	$	11,508,020	$	11,591,641	$	46,774	$	3,882,782	$	3,929,556

At December 31, 2014, nonaccrual loans and leases totaled $83.6 million. Nonaccrual loans and leases included all loans and leases 90 or more days past due of $18.8 million, $8.7 million of loans 30 to 89 days past due and $56.1 million of current loans that were placed on nonaccrual status based on management’s judgment regarding their collectability. Nonaccrual loans and leases totaled $46.8 million at December 31, 2013, including all loans and leases 90 or more days past due of $5.2 million, $4.2 million of loans 30 to 89 days past due and $37.3 million of current loans that were placed on nonaccrual status based on management’s judgment regarding their collectability.

Non‑PCI nonaccrual loans and leases and performing restructured loans are considered impaired for reporting purposes. The following table presents the composition of our impaired loans and leases as of the dates indicated:



	December 31, 2014						December 31, 2013
			Performing		Total				Performing		Total
	Nonaccrual		Restructured		Impaired		Nonaccrual		Restructured		Impaired
	Loans/Leases		Loans		Loans/Leases		Loans/Leases		Loans		Loans/Leases
	(In thousands)
Real estate mortgage	$	37,612	$	20,245	$	57,857	$	27,973	$	34,303	$	62,276
Real estate construction	1,559		8,996		10,555		3,219		4,293		7,512
Commercial	40,965		5,744		46,709		15,188		2,744		17,932
Consumer	3,485		259		3,744		394		308		702
Total	$	83,621	$	35,244	$	118,865	$	46,774	$	41,648	$	88,422

At December 31, 2014 and 2013, we had unfunded commitments related to Non-PCI performing restructured loans of $214,000 and $7,000.

The following tables present information regarding our Non‑PCI impaired loans and leases by portfolio segment and class as of and for the years indicated:



	December 31, 2014						December 31, 2013
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Recorded Investment		Unpaid Principal Balance		Related Allowance
	(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Hospitality	$	1,946	$	1,945	$	47	$	5,717	$	6,215	$	198
SBA	—		—		—		1,642		1,643		230
Other	9,136		9,233		646		15,937		16,571		1,760
Real estate construction:
Residential	763		763		46		778		778		168
Commercial	1,128		4,934		23		1,250		1,250		1
Commercial:
Collateralized	4,630		5,246		3,771		4,377		4,692		4,270
Unsecured	912		924		799		801		829		375
Asset-based	137		247		137		1,070		1,070		180
Cash flow	15,578		17,970		2,667		—		—		—
Equipment finance	6,956		7,268		2,601		—		—		—
SBA	—		—		—		1,136		1,136		178
Consumer	143		142		37		424		471		240
With No Related Allowance Recorded:
Real estate mortgage:
Hospitality	$	6,366	$	7,593	$	—	$	3,013	$	3,385	$	—
SBA	11,141		14,708		—		2,602		3,646		—
Other	29,268		40,643		—		33,365		46,062		—
Real estate construction:
Residential	21		19		—		—		—		—
Commercial	8,643		8,749		—		5,484		9,923		—
Commercial:
Collateralized	5,566		6,877		—		6,700		9,924		—
Unsecured	725		809		—		179		247		—
Asset-based	4,436		5,415		—		—		—		—
Cash flow	387		919		—		—		—		—
Equipment finance	4,175		7,528		—		632		632		—
SBA	3,207		4,920		—		3,037		4,945		—
Consumer	3,601		3,768		—		278		394		—
Total Non-PCI Loans and Leases With and Without an Allowance Recorded:
Real estate mortgage	$	57,857	$	74,122	$	693	$	62,276	$	77,522	$	2,188
Real estate construction	10,555		14,465		69		7,512		11,951		169
Commercial	46,709		58,123		9,975		17,932		23,475		5,003
Consumer	3,744		3,910		37		702		865		240
Total	$	118,865	$	150,620	$	10,774	$	88,422	$	113,813	$	7,600



	Year Ended December 31,
	2014				2013				2012
	Weighted Average Balance⁽¹⁾		Interest Income Recognized		Weighted Average Balance⁽¹⁾		Interest Income Recognized		Weighted Average Balance⁽¹⁾		Interest Income Recognized
	(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Hospitality	$	1,946	$	67	$	5,717	$	81	$	8,954	$	80
SBA	—		—		1,642		90		827		41
Other	9,136		409		13,205		509		51,441		2,070
Real estate construction:
Residential	763		15		778		14		1,303		11
Commercial	1,027		17		1,250		63		6,723		231
Commercial:
Collateralized	4,077		27		3,281		29		2,219		48
Unsecured	661		21		772		33		2,273		20
Asset-based	137		—		569		—		—		—
Cash flow	7,837		—		—		—		—		—
Equipment finance	3,802		—		—		—		—		—
SBA	—		—		1,136		56		2,593		53
Consumer	132		8		425		10		389		7
With No Related Allowance Recorded:
Real estate mortgage:
Hospitality	$	6,366	$	—	$	3,013	$	—	$	—	$	—
SBA	6,610		77		2,601		—		1,472		—
Other	21,652		315		27,912		1,060		29,316		1,523
Real estate construction:
Residential	4		—		—		—		—		—
Commercial	8,642		244		4,866		11		17,424		589
Commercial:
Collateralized	2,869		170		3,410		20		1,657		27
Unsecured	126		1		157		—		148		—
Asset-based	3,270		—		—		—		132		—
Cash flow	1		—		—		—		—		—
Equipment finance	2,534		—		245		—		224		—
SBA	2,162		98		2,571		—		2,601		24
Consumer	3,027		2		161		—		136		—
Total Non-PCI Loans and Leases With and Without an Allowance Recorded:
Real estate mortgage	$	45,710	$	868	$	54,090	$	1,740	$	92,010	$	3,714
Real estate construction	10,436		276		6,894		88		25,450		831
Commercial	27,476		317		12,141		138		11,847		172
Consumer	3,159		10		586		10		525		7
Total	$	86,781	$	1,471	$	73,711	$	1,976	$	129,832	$	4,724

_________________________


(1)	For the loans and leases (excluding PCI loans) reported as impaired at December 31, 2014, 2013 and 2012, amounts were calculated based on the period of time such loans and leases were impaired during the reported period.

Troubled debt restructurings are a result of rate reductions, term extensions, fee concessions and debt forgiveness or a combination thereof. The following table presents new and defaulted troubled debt restructurings of Non-PCI loans for the years indicated:



	Troubled Debt Restructurings					Troubled Debt Restructurings That Subsequently Defaulted⁽¹⁾
	Number of Loans	Pre- Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Recorded Investment
	(Dollars In thousands)
Year Ended December 31, 2014
Real estate mortgage:
Hospitality	1	$	1,946	$	1,946	—	$	—
SBA	1	64		64		1	55
Other	23	17,443		17,444		—	—
Real estate construction - Commercial	4	5,507		4,965		—	—
Commercial:
Collateralized	22	12,368		6,336		1	390
Unsecured	10	752		752		—	—
Equipment finance	1	518		518		—	—
SBA	3	1,965		1,965		1	1,144
Consumer	7	467		467		—	—
Total	72	$	41,030	$	34,457	3	$	1,589	(2)
Year Ended December 31, 2013
Real estate mortgage - Other	14	$	16,223	$	16,223	2	$	1,844
Real estate construction - Residential	1	390		390		—	—
Commercial:
Collateralized	11	5,618		5,618		1	419
Unsecured	5	521		521		2	66
Asset-based	1	2,032		2,032		1	1,070
SBA	4	137		137		—	—
Consumer	2	125		125		—	—
Total	38	$	25,046	$	25,046	6	$	3,399	(3)
Year Ended December 31, 2012
Real estate mortgage:
SBA	2	$	1,680	$	1,680	—	$	—
Other	8	14,861		13,840		—	—
Real estate construction - Other	3	6,919		6,919		—	—
Commercial:
Collateralized	7	1,652		1,652		2	458
Unsecured	5	317		317		—	—
SBA	4	1,216		1,216		1	873
Consumer	1	206		206		—	—
Total	30	$	26,851	$	25,830	3	$	1,331	(4)

_________________________


(1)	The population of defaulted restructured loans for the period indicated includes only those loans restructured during the preceding 12-month period. The table excludes defaulted troubled restructurings in those classes for which the recorded investment was zero at the end of the period.


(2)	Represents the balance at December 31, 2014, and is net of charge-offs of $129,000.


(3)	Represents the balance at December 31, 2013, and is net of charge-offs of $1.6 million.


(4)	Represents the balance at December 31, 2012, and is net of charge-offs of $921,000.

Purchased Credit Impaired (PCI) Loans

The following table reflects the PCI loans by portfolio segment as of the dates indicated:



	December 31, 2014			December 31, 2013
	(In thousands)
Real estate mortgage	$	299,660		$	412,791
Real estate construction	7,743			12,015
Commercial	32,904			3,021
Consumer	332			424
Total gross PCI loans	340,639			428,251
Less:
Discount	(49,848		)	(45,455		)
Allowance for loan losses	(13,999		)	(21,793		)
Total net PCI loans	$	276,792		$	361,003

The following table summarizes the changes in the carrying amount of PCI loans and accretable yield on those loans for the years indicated:



	Carrying Amount			Accretable Yield
	(In thousands)
Balance, December 31, 2011	$	674,058		$	(259,265	)
Accretion	49,562			49,562
Payments received	(232,623		)	—
Decrease in expected cash flows, net	—			13,681
Negative provision for credit losses	819			—
Balance, December 31, 2012	491,816			(196,022		)
Addition from the FCAL acquisition	44,146			(8,096		)
Accretion	46,680			46,680
Payments received	(225,849		)	—
Decrease in expected cash flows, net	—			17,870
Negative provision for credit losses	4,210			—
Balance, December 31, 2013	361,003			(139,568		)
Addition from the CapitalSource merger	79,234			(13,728		)
Accretion	57,213			57,213
Payments received	(219,641		)	—
Increase in expected cash flows, net	—			(10,773		)
Provision for credit losses	(1,017		)	—
Balance, December 31, 2014	$	276,792		$	(106,856	)

The following table summarizes the accretable yield on the PCI loans acquired in the CapitalSource Inc. merger as of April 7, 2014:



	April 7, 2014 Accretable Yield
	(In thousands)
Undiscounted contractual cash flows	$	231,832
Undiscounted cash flows not expected to be collected (nonaccretable difference)	(138,870		)
Undiscounted cash flows expected to be collected	92,962
Estimated fair value of PCI loans acquired	(79,234		)
Accretable yield	$	13,728

The following table presents the credit risk rating categories for PCI loans by portfolio segment as of the dates indicated. Nonclassified loans are those with a credit risk rating of either pass or special mention, while classified loans are those with a credit risk rating of either substandard or doubtful.



	December 31, 2014						December 31, 2013
	Nonclassified		Classified		Total		Nonclassified		Classified		Total
	(In thousands)
Real estate mortgage	$	155,281	$	101,161	$	256,442	$	216,092	$	155,042	$	371,134
Real estate construction	3,010		3,901		6,911		4,399		6,028		10,427
Commercial	212		26,942		27,154		569		405		974
Consumer	—		284		284		—		261		261
Total PCI loans	$	158,503	$	132,288	$	290,791	$	221,060	$	161,736	$	382,796