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Business Segment
 6 Months Ended
Jun. 30, 2015
Segment Reporting [Abstract]  
Segment Data
Business Segments
The Company’s reportable segments consist of “Community Banking," “National Lending,” and “Other.” The Community Banking and National Lending segments include all of the operations of Pacific Western Bank. The Other segment consists of holding company and non-bank subsidiary operations, and intercompany eliminations.
As a result of the CapitalSource Inc. merger, the Bank established the CapitalSource Division, which we also refer to as the National Lending segment. The National Lending segment includes the lending operations gained through the CapitalSource Inc. merger, Pacific Western Equipment Finance, and the CapitalSource Business Finance Group. We reorganized our asset-based lending and leasing operations when we established the CapitalSource Division.
The CapitalSource Division lends throughout the United States, providing middle-market businesses asset-secured loans, equipment-secured loans, cash flow loans, and real estate loans secured by various property types. The CapitalSource Division’s loan and lease origination efforts are conducted through offices located in Chevy Chase, Maryland; Los Angeles and San Jose, California; Phoenix, Arizona; St. Louis, Missouri; Denver, Colorado; Chicago, Illinois; New York, New York; and Midvale, Utah.
The Community Banking segment includes the operations of Pacific Western Bank, excluding the CapitalSource Division, and includes lending and deposit gathering activities conducted primarily through its California-based branch offices and the Bank’s treasury management function and corporate overhead.
The Other segment consists of holding company operations that result in expenses principally for compensation, facilities, professional services, interest on subordinated debentures, and the non-bank subsidiary operations including interest income from a loan portfolio and related loan servicing expense.
The accounting policies of the reported segments are the same as those of the Company described in Note 1, "Nature of Operations and Summary of Significant Accounting Policies," of our Form 10-K. Transactions between segments consist primarily of borrowed funds and expense allocations for interest, deposit gathering, corporate overhead and credit loss provisions. Intersegment interest expense is allocated from the Community Banking segment to the National Lending segment based upon National Lending’s average earning assets, net of a capital allocation, and the Bank’s total cost of deposits. The Community Banking segment further allocates to the National Lending segment noninterest expense for deposit gathering and maintenance costs and the Bank’s corporate overhead. The provision for credit losses is allocated based on actual charge‑offs for the period as well as net portfolio growth and credit quality trends. All costs associated with investing the Bank’s excess liquidity and acquisition, integration and reorganization costs are included in the Community Banking segment. Noninterest income and noninterest expense, including lending and loan servicing activity, directly attributable to a segment are assigned to such segment.
The following tables present information regarding our business segments as of and for the periods indicated:
 
June 30, 2015
 
Community
 
National
 
 
 
Consolidated
Balance Sheet Data:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Loans and leases, net of deferred fees
$
3,101,834

 
$
8,923,079

 
$
9,276

 
$
12,034,189

Allowance for loan and lease losses
(41,108
)
 
(58,260
)
 
(7
)
 
(99,375
)
Total loans and leases, net
$
3,060,726

 
$
8,864,819

 
$
9,269

 
$
11,934,814

Goodwill
$
333,979

 
$
1,394,401

 
$
—

 
$
1,728,380

Core deposit and customer relationship intangibles, net
13,528

 
673

 
—

 
14,201

Total assets
6,685,456

 
9,870,154

 
141,410

 
16,697,020

Total deposits(1)
12,962,905

 
35,420

 
(416,509
)
 
12,581,816

________________________
(1)
The negative balance for total deposits in the “Other” segment represents the elimination of holding company cash held in deposit accounts at the Bank.

 
June 30, 2014
 
Community
 
National
 
 
 
Consolidated
Balance Sheet Data:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Loans and leases, net of deferred fees
$
3,537,994

 
$
7,599,030

 
$
53,081

 
$
11,190,105

Allowance for loan and lease losses
(66,039
)
 
(16,110
)
 
—

 
(82,149
)
Total loans and leases, net
$
3,471,955

 
$
7,582,920

 
$
53,081

 
$
11,107,956

Goodwill
$
279,296

 
$
1,445,857

 
$
—

 
$
1,725,153

Core deposit and customer relationship intangibles, net
19,330

 
1,101

 
—

 
20,431

Total assets
6,100,744

 
9,275,500

 
308,427

 
15,684,671

Total deposits(1)
11,909,853

 
28,302

 
(270,358
)
 
11,667,797

________________________
(1)
The negative balance for total deposits in the “Other” segment represents the elimination of holding company cash held in deposit accounts at the Bank.
 
Three Months Ended June 30, 2015
 
Community
 
National
 
 
 
Consolidated
Results of Operations:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Interest income
$
63,392

 
$
154,816

 
$
247

 
$
218,455

Interest expense
(11,273
)
 
(48
)
 
(4,582
)
 
(15,903
)
Intersegment interest income (expense)
7,140

 
(7,140
)
 
—

 
—

Net interest income (expense)
59,259

 
147,628

 
(4,335
)
 
202,552

Negative provision (provision) for credit losses
734

 
(7,263
)
 
—

 
(6,529
)
Loss on securities
(186
)
 
—

 
—

 
(186
)
FDIC loss sharing expense, net
(5,107
)
 
—

 
—

 
(5,107
)
Other noninterest income
4,235

 
14,465

 
6,216

 
24,916

Total noninterest income
(1,058
)
 
14,465

 
6,216

 
19,623

Foreclosed assets (expense) income, net
(351
)
 
(22
)
 
2,713

 
2,340

Intangible asset amortization
(1,390
)
 
(112
)
 
—

 
(1,502
)
Acquisition, integration and reorganization costs
(806
)
 
—

 
(94
)
 
(900
)
Other noninterest expense
(58,304
)
 
(24,164
)
 
(2,746
)
 
(85,214
)
Total noninterest expense
(60,851
)
 
(24,298
)
 
(127
)
 
(85,276
)
Intersegment noninterest income (expense)
28,857

 
(28,857
)
 
—

 
—

Total noninterest expense - adjusted
(31,994
)
 
(53,155
)
 
(127
)
 
(85,276
)
Earnings before taxes
26,941

 
101,675

 
1,754

 
130,370

Income tax (expense) benefit
(10,484
)
 
(39,566
)
 
4,763

 
(45,287
)
Net earnings
$
16,457

 
$
62,109

 
$
6,517

 
$
85,083

 
Three Months Ended March 31, 2015
 
Community
 
National
 
 
 
Consolidated
Results of Operations:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Interest income
$
62,956

 
$
151,219

 
$
139

 
$
214,314

Interest expense
(10,661
)
 
(53
)
 
(4,525
)
 
(15,239
)
Intersegment interest income (expense)
6,721

 
(6,721
)
 
—

 
—

Net interest income (expense)
59,016

 
144,445

 
(4,386
)
 
199,075

Negative provision (provision) for credit losses
8,064

 
(24,406
)
 
(92
)
 
(16,434
)
Gain on securities
3,275

 
—

 
—

 
3,275

FDIC loss sharing expense, net
(4,399
)
 
—

 
—

 
(4,399
)
Other noninterest income
9,575

 
5,142

 
7,278

 
21,995

Total noninterest income
8,451

 
5,142

 
7,278

 
20,871

Foreclosed assets expense, net
(44
)
 
(61
)
 
(231
)
 
(336
)
Intangible asset amortization
(1,389
)
 
(112
)
 
—

 
(1,501
)
Acquisition, integration and reorganization costs
(1,890
)
 
—

 
(110
)
 
(2,000
)
Other noninterest expense
(55,205
)
 
(22,837
)
 
(2,481
)
 
(80,523
)
Total noninterest expense
(58,528
)
 
(23,010
)
 
(2,822
)
 
(84,360
)
Intersegment noninterest income (expense)
26,563

 
(26,563
)
 
—

 
—

Total noninterest expense - adjusted
(31,965
)
 
(49,573
)
 
(2,822
)
 
(84,360
)
Earnings (loss) before taxes
43,566

 
75,608

 
(22
)
 
119,152

Income tax (expense) benefit
(16,873
)
 
(29,282
)
 
82

 
(46,073
)
Net earnings
$
26,693

 
$
46,326

 
$
60

 
$
73,079

 
Three Months Ended June 30, 2014
 
Community
 
National
 
 
 
Consolidated
Results of Operations:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Interest income
$
69,977

 
$
132,742

 
$
1,644

 
$
204,363

Interest expense
(7,450
)
 
(62
)
 
(4,318
)
 
(11,830
)
Intersegment interest income (expense)
4,071

 
(4,071
)
 
—

 
—

Net interest income (expense)
66,598

 
128,609

 
(2,674
)
 
192,533

Negative provision (provision) for credit losses
4,418

 
(9,448
)
 
—

 
(5,030
)
Gain on securities
89

 
—

 
—

 
89

FDIC loss sharing expense, net
(8,525
)
 
—

 
—

 
(8,525
)
Other noninterest income
3,681

 
12,487

 
747

 
16,915

Total noninterest income
(4,755
)
 
12,487

 
747

 
8,479

Foreclosed assets income (expense), net
(633
)
 
38

 
98

 
(497
)
Intangible asset amortization
(1,530
)
 
(147
)
 
—

 
(1,677
)
Acquisition, integration and reorganization costs
(77,713
)
 
(7,474
)
 
(1,055
)
 
(86,242
)
Other noninterest expense
(50,801
)
 
(24,484
)
 
(5,499
)
 
(80,784
)
Total noninterest expense
(130,677
)
 
(32,067
)
 
(6,456
)
 
(169,200
)
Intersegment noninterest income (expense)
23,533

 
(23,533
)
 
—

 
—

Total noninterest expense - adjusted
(107,144
)
 
(55,600
)
 
(6,456
)
 
(169,200
)
(Loss) earnings from continuing operations before taxes
(40,883
)
 
76,048

 
(8,383
)
 
26,782

Income tax (expense) benefit
11,375

 
(30,259
)
 
3,332

 
(15,552
)
Net (loss) earnings from continuing operations
(29,508
)
 
45,789

 
(5,051
)
 
11,230

Loss from discontinued operations before taxes
(1,151
)
 
—

 
—

 
(1,151
)
Income tax benefit
476

 
—

 
—

 
476

Net loss from discontinued operations
(675
)
 
—

 
—

 
(675
)
Net (loss) earnings
$
(30,183
)
 
$
45,789

 
$
(5,051
)
 
$
10,555

 
Six Months Ended June 30, 2015
 
Community
 
National
 
 
 
Consolidated
Results of Operations:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Interest income
$
126,348

 
$
306,035

 
$
386

 
$
432,769

Interest expense
(21,934
)
 
(101
)
 
(9,107
)
 
(31,142
)
Intersegment interest income (expense)
13,861

 
(13,861
)
 
—

 
—

Net interest income (expense)
118,275

 
292,073

 
(8,721
)
 
401,627

Negative provision (provision) for credit losses
8,798

 
(31,669
)
 
(92
)
 
(22,963
)
Gain on securities
3,089

 
—

 
—

 
3,089

FDIC loss sharing expense, net
(9,506
)
 
—

 
—

 
(9,506
)
Other noninterest income
13,810

 
19,607

 
13,494

 
46,911

Total noninterest income (expense)
7,393

 
19,607

 
13,494

 
40,494

Foreclosed assets (expense) income, net
(395
)
 
(83
)
 
2,482

 
2,004

Intangible asset amortization
(2,779
)
 
(224
)
 
—

 
(3,003
)
Acquisition, integration and reorganization costs
(2,696
)
 
—

 
(204
)
 
(2,900
)
Other noninterest expense
(113,509
)
 
(47,001
)
 
(5,227
)
 
(165,737
)
Total noninterest expense
(119,379
)
 
(47,308
)
 
(2,949
)
 
(169,636
)
Intersegment noninterest income (expense)
55,420

 
(55,420
)
 
—

 
—

Total noninterest expense - adjusted
(63,959
)
 
(102,728
)
 
(2,949
)
 
(169,636
)
Earnings (loss) from continuing operations before taxes
70,507

 
177,283

 
1,732

 
249,522

Income tax (expense) benefit
(27,357
)
 
(68,848
)
 
4,845

 
(91,360
)
Net earnings
$
43,150

 
$
108,435

 
$
6,577

 
$
158,162

 
Six Months Ended June 30, 2014
 
Community
 
National
 
 
 
Consolidated
Results of Operations:
Banking
 
Lending
 
Other
 
Company
 
(In thousands)
Interest income
$
147,572

 
$
143,507

 
$
1,644

 
$
292,723

Interest expense
(8,677
)
 
(139
)
 
(5,359
)
 
(14,175
)
Intersegment interest income (expense)
4,293

 
(4,293
)
 
—

 
—

Net interest income (expense)
143,188

 
139,075

 
(3,715
)
 
278,548

Negative provision (provision) for credit losses
5,244

 
(9,630
)
 
—

 
(4,386
)
Gain on securities
4,841

 
—

 
—

 
4,841

FDIC loss sharing expense, net
(19,955
)
 
—

 
—

 
(19,955
)
Other noninterest income
10,578

 
16,932

 
774

 
28,284

Total noninterest income
(4,536
)
 
16,932

 
774

 
13,170

Foreclosed assets income, net
1,228

 
38

 
98

 
1,364

Intangible asset amortization
(2,721
)
 
(320
)
 
—

 
(3,041
)
Acquisition, integration and reorganization costs
(79,913
)
 
(7,474
)
 
(1,055
)
 
(88,442
)
Other noninterest expense
(91,086
)
 
(31,057
)
 
(7,102
)
 
(129,245
)
Total noninterest expense
(172,492
)
 
(38,813
)
 
(8,059
)
 
(219,364
)
Intersegment noninterest income (expense)
23,533

 
(23,533
)
 
—

 
—

Total noninterest expense - adjusted
(148,959
)
 
(62,346
)
 
(8,059
)
 
(219,364
)
(Loss) earnings from continuing operations before taxes
(5,063
)
 
84,031

 
(11,000
)
 
67,968

Income tax (expense) benefit
(1,664
)
 
(33,590
)
 
4,421

 
(30,833
)
Net (loss) earnings from continuing operations
(6,727
)
 
50,441

 
(6,579
)
 
37,135

Loss from discontinued operations before taxes
(2,564
)
 
—

 
—

 
(2,564
)
Income tax benefit
1,064

 
—

 
—

 
1,064

Net loss from discontinued operations
(1,500
)
 
—

 
—

 
(1,500
)
Net (loss) earnings
$
(8,227
)
 
$
50,441

 
$
(6,579
)
 
$
35,635