XML 40 R27.htm IDEA: XBRL DOCUMENT

Loans and Leases (Tables)

6 Months Ended

Jun. 30, 2019

Accounts, Notes, Loans and Financing Receivable [Line Items]

Schedule of composition of loans portfolio

The following table summarizes the composition of our loans and leases held for investment as of the dates indicated:



	June 30,			December 31,
	2019			2018
	(In thousands)
Real estate mortgage	$	8,087,586		$	7,933,859
Real estate construction and land	2,405,073			2,262,710
Commercial	7,593,728			7,428,500
Consumer	446,353			401,296
Total gross loans and leases held for investment	18,532,740			18,026,365
Deferred fees, net	(59,888		)	(68,652		)
Total loans and leases held for investment,
net of deferred fees	18,472,852			17,957,713
Allowance for loan and lease losses	(135,037		)	(132,472		)
Total loans and leases held for investment, net	$	18,337,815		$	17,825,241

Delinquent loans in loan portfolio

The following tables present an aging analysis of our loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of the dates indicated:



	June 30, 2019
	30 - 89		90 or More
	Days		Days		Total
	Past Due		Past Due		Past Due		Current		Total
	(In thousands)
Real estate mortgage:
Commercial	$	4,516	$	6,632	$	11,148	$	4,424,126	$	4,435,274
Income producing and other residential	3,692		422		4,114		3,636,638		3,640,752
Total real estate mortgage	8,208		7,054		15,262		8,060,764		8,076,026
Real estate construction and land:
Commercial	—		—		—		972,891		972,891
Residential	4,672		—		4,672		1,398,567		1,403,239
Total real estate construction and land	4,672		—		4,672		2,371,458		2,376,130
Commercial:
Asset-based	12,382		1,624		14,006		3,592,001		3,606,007
Venture capital	447		—		447		2,194,296		2,194,743
Other commercial	2,329		928		3,257		1,770,307		1,773,564
Total commercial	15,158		2,552		17,710		7,556,604		7,574,314
Consumer	964		169		1,133		445,249		446,382
Total	$	29,002	$	9,775	$	38,777	$	18,434,075	$	18,472,852



	December 31, 2018
	30 - 89		90 or More
	Days		Days		Total
	Past Due		Past Due		Past Due		Current		Total
	(In thousands)
Real estate mortgage:
Commercial	$	3,487	$	7,541	$	11,028	$	4,813,270	$	4,824,298
Income producing and other residential	1,557		476		2,033		3,091,810		3,093,843
Total real estate mortgage	5,044		8,017		13,061		7,905,080		7,918,141
Real estate construction and land:
Commercial	—		442		442		912,141		912,583
Residential	1,527		—		1,527		1,319,546		1,321,073
Total real estate construction and land	1,527		442		1,969		2,231,687		2,233,656
Commercial:
Asset-based	47		646		693		3,304,728		3,305,421
Venture capital	4,705		—		4,705		2,034,043		2,038,748
Other commercial	5,181		1,285		6,466		2,053,960		2,060,426
Total commercial	9,933		1,931		11,864		7,392,731		7,404,595
Consumer	581		333		914		400,407		401,321
Total	$	17,085	$	10,723	$	27,808	$	17,929,905	$	17,957,713

Schedule of non accrual and performing restructured impaired financing receivables

The following table presents our nonaccrual and performing loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of the dates indicated:



	June 30, 2019						December 31, 2018
	Nonaccrual		Performing		Total		Nonaccrual		Performing		Total
	(In thousands)
Real estate mortgage:
Commercial	$	17,012	$	4,418,262	$	4,435,274	$	15,321	$	4,808,977	$	4,824,298
Income producing and other residential	2,883		3,637,869		3,640,752		2,524		3,091,319		3,093,843
Total real estate mortgage	19,895		8,056,131		8,076,026		17,845		7,900,296		7,918,141
Real estate construction and land:
Commercial	390		972,501		972,891		442		912,141		912,583
Residential	—		1,403,239		1,403,239		—		1,321,073		1,321,073
Total real estate construction and land	390		2,375,740		2,376,130		442		2,233,214		2,233,656
Commercial:
Asset-based	32,236		3,573,771		3,606,007		32,324		3,273,097		3,305,421
Venture capital	22,501		2,172,242		2,194,743		20,299		2,018,449		2,038,748
Other commercial	5,799		1,767,765		1,773,564		7,380		2,053,046		2,060,426
Total commercial	60,536		7,513,778		7,574,314		60,003		7,344,592		7,404,595
Consumer	444		445,938		446,382		1,043		400,278		401,321
Total	$	81,265	$	18,391,587	$	18,472,852	$	79,333	$	17,878,380	$	17,957,713

The following table presents the composition of our impaired loans and leases held for investment, net of deferred fees, by loan portfolio segment as of the dates indicated:



	June 30, 2019						December 31, 2018
					Total						Total
	Nonaccrual				Impaired		Nonaccrual				Impaired
	Loans				Loans		Loans				Loans
	and		Performing		and		and		Performing		and
	Leases		TDRs		Leases		Leases		TDRs		Leases
	(In thousands)
Real estate mortgage	$	19,895	$	10,457	$	30,352	$	17,845	$	11,484	$	29,329
Real estate construction and land	390		4,986		5,376		442		5,420		5,862
Commercial	60,536		931		61,467		60,003		692		60,695
Consumer	444		90		534		1,043		105		1,148
Total	$	81,265	$	16,464	$	97,729	$	79,333	$	17,701	$	97,034

CV of loans held for investment by class by performing and nonperforming

The following tables present the credit risk rating categories for loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of the dates indicated. Classified loans and leases are those with a credit risk rating of either substandard or doubtful.



	June 30, 2019
	Classified		Special Mention		Pass		Total
	(In thousands)
Real estate mortgage:
Commercial	$	32,926	$	52,477	$	4,349,871	$	4,435,274
Income producing and other residential	8,693		355		3,631,704		3,640,752
Total real estate mortgage	41,619		52,832		7,981,575		8,076,026
Real estate construction and land:
Commercial	390		—		972,501		972,891
Residential	—		5,268		1,397,971		1,403,239
Total real estate construction and land	390		5,268		2,370,472		2,376,130
Commercial:
Asset-based	41,151		48,324		3,516,532		3,606,007
Venture capital	42,105		68,426		2,084,212		2,194,743
Other commercial	65,139		63,591		1,644,834		1,773,564
Total commercial	148,395		180,341		7,245,578		7,574,314
Consumer	575		863		444,944		446,382
Total	$	190,979	$	239,304	$	18,042,569	$	18,472,852



	December 31, 2018
	Classified		Special Mention		Pass		Total
	(In thousands)
Real estate mortgage:
Commercial	$	57,734	$	74,785	$	4,691,779	$	4,824,298
Income producing and other residential	10,521		968		3,082,354		3,093,843
Total real estate mortgage	68,255		75,753		7,774,133		7,918,141
Real estate construction and land:
Commercial	442		7,041		905,100		912,583
Residential	—		1,527		1,319,546		1,321,073
Total real estate construction and land	442		8,568		2,224,646		2,233,656
Commercial:
Asset-based	45,957		48,338		3,211,126		3,305,421
Venture capital	28,731		77,588		1,932,429		2,038,748
Other commercial	92,526		50,136		1,917,764		2,060,426
Total commercial	167,214		176,062		7,061,319		7,404,595
Consumer	1,199		1,015		399,107		401,321
Total	$	237,110	$	261,398	$	17,459,205	$	17,957,713

Impaired financing receivables, average balances and interest income recognized

The following tables present information regarding our impaired loans and leases held for investment, net of deferred fees, by loan portfolio segment and class as of and for the dates indicated:



	June 30, 2019						December 31, 2018
			Unpaid						Unpaid
	Recorded		Principal		Related		Recorded		Principal		Related
Impaired Loans and Leases	Investment		Balance		Allowance		Investment		Balance		Allowance
	(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Commercial	$	493	$	493	$	69	$	1,736	$	1,648	$	170
Income producing and other residential	2,066		2,061		191		2,569		2,563		247
Commercial:
Asset based	—		—		—		—		—		—
Venture capital	22,265		24,353		4,482		11,621		13,255		3,141
Other commercial	618		618		—		473		482		473
With No Related Allowance Recorded:
Real estate mortgage:
Commercial	$	19,994	$	34,694			$	17,783	$	32,035
Income producing and other residential	7,799		10,234				7,241		9,425
Real estate construction and land:
Commercial	5,376		5,419				5,862		5,870
Commercial:
Asset-based	32,236		49,853				32,324		38,100
Venture capital	237		26,531				8,678		41,335
Other commercial	6,111		26,562				7,599		25,740
Consumer	534		702				1,148		1,470
Total Loans and Leases With and
Without an Allowance Recorded:
Real estate mortgage	$	30,352	$	47,482	$	260	$	29,329	$	45,671	$	417
Real estate construction and land	5,376		5,419		—		5,862		5,870		—
Commercial	61,467		127,917		4,482		60,695		118,912		3,614
Consumer	534		702		—		1,148		1,470		—
Total	$	97,729	$	181,520	$	4,742	$	97,034	$	171,923	$	4,031



	Three Months Ended June 30,
	2019				2018
	Weighted		Interest		Weighted		Interest
	Average		Income		Average		Income
Impaired Loans and Leases	Balance⁽¹⁾		Recognized		Balance⁽¹⁾		Recognized
	(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Commercial	$	493	$	8	$	7,786	$	103
Income producing and other residential	2,066		15		2,419		21
Commercial:
Venture capital	19,242		—		18,449		—
Other commercial	619		9		688		—
With No Related Allowance Recorded:
Real estate mortgage:
Commercial	$	16,716	$	54	$	58,733	$	725
Income producing and other residential	7,738		57		8,293		44
Real estate construction and land:
Commercial	5,376		98		5,549		93
Residential	—		—		10,450		—
Commercial:
Asset-based	31,148		—		29,677		—
Venture capital	237		—		2,800		—
Other commercial	6,111		20		8,508		335
Consumer	511		1		355		2
Total Loans and Leases With and
Without an Allowance Recorded:
Real estate mortgage	$	27,013	$	134	$	77,231	$	893
Real estate construction and land	5,376		98		15,999		93
Commercial	57,357		29		60,122		335
Consumer	511		1		355		2
Total	$	90,257	$	262	$	153,707	$	1,323

_________________________


(1)	For loans and leases reported as impaired at June 30, 2019 and 2018, amounts were calculated based on the period of time such loans and leases were impaired during the reported period.



	Six Months Ended June 30,
	2019				2018
	Weighted		Interest		Weighted		Interest
	Average		Income		Average		Income
Impaired Loans and Leases	Balance⁽¹⁾		Recognized		Balance⁽¹⁾		Recognized
	(In thousands)
With An Allowance Recorded:
Real estate mortgage:
Commercial	$	493	$	16	$	7,786	$	204
Income producing and other residential	2,066		29		2,419		42
Commercial:
Venture capital	15,359		—		15,715		—
Other commercial	619		18		346		—
With No Related Allowance Recorded:
Real estate mortgage:
Commercial	$	16,016	$	106	$	55,214	$	1,378
Income producing and other residential	7,647		110		8,277		88
Real estate construction and land:
Commercial	5,376		196		5,549		184
Commercial:
Asset-based	30,881		—		29,677		—
Venture capital	237		—		2,645		—
Other commercial	6,052		51		7,946		1,377
Consumer	485		3		341		4
Total Loans and Leases With and
Without an Allowance Recorded:
Real estate mortgage	$	26,222	$	261	$	73,696	$	1,712
Real estate construction and land	5,376		196		10,803		184
Commercial	53,148		69		56,329		1,377
Consumer	485		3		341		4
Total	$	85,231	$	529	$	141,169	$	3,277

_________________________


(1)	For loans and leases reported as impaired at June 30, 2019 and 2018, amounts were calculated based on the period of time such loans and leases were impaired during the reported period.

Troubled debt restructurings on financing receivables

The following table presents our troubled debt restructurings of loans held for investment by loan portfolio segment and class for the periods indicated:



	Three Months Ended June 30,
	2019					2018
		Pre-		Post-			Pre-		Post-
		Modification		Modification			Modification		Modification
	Number	Outstanding		Outstanding		Number	Outstanding		Outstanding
	of	Recorded		Recorded		of	Recorded		Recorded
Troubled Debt Restructurings	Loans	Investment		Investment		Loans	Investment		Investment
	(Dollars in thousands)
Real estate mortgage:
Income producing and other residential	3	$	456	$	456	3	$	1,704	$	645
Commercial:
Asset-based	1	620		620		—	—		—
Venture capital	4	13,971		14,972		4	5,236		5,236
Other commercial	3	107		107		2	31		31
Consumer	—	—		—		1	27		27
Total	11	$	15,154	$	16,155	10	$	6,998	$	5,939



	Six Months Ended June 30,
	2019					2018
		Pre-		Post-			Pre-		Post-
		Modification		Modification			Modification		Modification
	Number	Outstanding		Outstanding		Number	Outstanding		Outstanding
	of	Recorded		Recorded		of	Recorded		Recorded
Troubled Debt Restructurings	Loans	Investment		Investment		Loans	Investment		Investment
	(Dollars in thousands)
Real estate mortgage:
Commercial	1	$	37	$	—	—	$	—	$	—
Income producing and other residential	6	1,245		1,245		3	1,704		645
Commercial:
Asset-based	1	620		620		—	—		—
Venture capital	10	16,076		16,214		4	5,236		5,236
Other commercial	11	692		692		4	11,814		11,814
Consumer	—	—		—		1	27		27
Total	29	$	18,670	$	18,771	12	$	18,781	$	17,722

During the three months ended June 30, 2019, two venture capital loans totaling $447,000 and one other commercial loan of $81,000 were restructured in the preceding 12-month period and subsequently defaulted after being restructured. During the six months ended June 30, 2019, two venture capital loans totaling $447,000 and three other commercial loans totaling $140,000 were restructured in the preceding 12-month period and subsequently defaulted after being restructured.

During the three months ended June 30, 2018, there were no loans restructured in the preceding 12-month period that subsequently defaulted after being restructured. Due the six months ended June 30, 2018, one other commercial loan of $2.1 million was restructured in the preceding 12-month period and subsequently defaulted after being restructured.

Allowance for credit losses on financing receivables

The following tables present a summary of the activity in the allowance for loan and lease losses and reserve for unfunded loan commitments for the periods indicated:



	Three Months Ended June 30, 2019
	Allowance for			Reserve for			Total
	Loan and			Unfunded Loan			Allowance for
	Lease Losses			Commitments			Credit Losses
	(In thousands)
Balance, beginning of period	$	136,281		$	36,861		$	173,142
Charge-offs	(17,637		)	—			(17,637		)
Recoveries	6,393			—			6,393
Net charge-offs	(11,244		)	—			(11,244		)
Provision (negative provision)	10,000			(2,000		)	8,000
Balance, end of period	$	135,037		$	34,861		$	169,898



	Six Months Ended June 30, 2019
	Allowance for			Reserve for			Total
	Loan and			Unfunded Loan			Allowance for
	Lease Losses			Commitments			Credit Losses
	(In thousands)
Balance, beginning of period	$	132,472		$	36,861		$	169,333
Charge-offs	(21,102		)	—			(21,102		)
Recoveries	9,667			—			9,667
Net charge-offs	(11,435		)	—			(11,435		)
Provision (negative provision)	14,000			(2,000		)	12,000
Balance, end of period	$	135,037		$	34,861		$	169,898



	Three Months Ended June 30, 2018
	Allowance for			Reserve for		Total
	Loan and			Unfunded Loan		Allowance for
	Lease Losses			Commitments		Credit Losses
	(In thousands)
Balance, beginning of period	$	134,275		$	32,861	$	167,136
Charge-offs	(18,235		)	—		(18,235		)
Recoveries	1,099			—		1,099
Net charge-offs	(17,136		)	—		(17,136		)
Provision	15,000			2,500		17,500
Balance, end of period	$	132,139		$	35,361	$	167,500



	Six Months Ended June 30, 2018
	Allowance for			Reserve for		Total
	Loan and			Unfunded Loan		Allowance for
	Lease Losses			Commitments		Credit Losses
	(In thousands)
Balance, beginning of period ⁽¹⁾	$	139,456		$	28,635	$	168,091
Charge-offs	(30,388		)	—		(30,388		)
Recoveries	8,297			—		8,297
Net charge-offs	(22,091		)	—		(22,091		)
Provision	14,774			6,726		21,500
Balance, end of period	$	132,139		$	35,361	$	167,500

The following tables present a summary of the activity in the allowance for loan and lease losses on loans and leases held for investment by loan portfolio segment for the periods indicated:



	Three Months Ended June 30, 2019
				Real Estate
	Real Estate			Construction
	Mortgage			and Land			Commercial			Consumer			Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	45,754		$	27,208		$	61,496		$	1,823		$	136,281
Charge-offs	(534		)	—			(16,927		)	(176		)	(17,637		)
Recoveries	240			—			6,080			73			6,393
Net charge-offs	(294		)	—			(10,847		)	(103		)	(11,244		)
Provision (negative provision)	1,366			(830		)	8,752			712			10,000
Balance, end of period	$	46,826		$	26,378		$	59,401		$	2,432		$	135,037



	Six Months Ended June 30, 2019
				Real Estate
	Real Estate			Construction
	Mortgage			and Land			Commercial			Consumer			Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	46,021		$	28,209		$	56,360		$	1,882		$	132,472
Charge-offs	(730		)	—			(19,930		)	(442		)	(21,102		)
Recoveries	383			—			9,186			98			9,667
Net charge-offs	(347		)	—			(10,744		)	(344		)	(11,435		)
Provision (negative provision)	1,152			(1,831		)	13,785			894			14,000
Balance, end of period	$	46,826		$	26,378		$	59,401		$	2,432		$	135,037

Ending Allowance by
Impairment Methodology:
Individually evaluated for impairment	$	260		$	—		$	4,482		$	—		$	4,742
Collectively evaluated for impairment	$	46,566		$	26,378		$	54,919		$	2,432		$	130,295

Ending Loans and Leases by
Impairment Methodology:
Individually evaluated for impairment	$	27,594		$	5,376		$	60,380		$	—		$	93,350
Collectively evaluated for impairment	8,048,432			2,370,754			7,513,934			446,382			18,379,502
Ending balance	$	8,076,026		$	2,376,130		$	7,574,314		$	446,382		$	18,472,852



	Three Months Ended June 30, 2018
				Real Estate
	Real Estate			Construction
	Mortgage			and Land		Commercial			Consumer			Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period	$	40,158		$	18,190	$	73,780		$	2,147		$	134,275
Charge-offs	(4,747		)	—		(13,425		)	(63		)	(18,235		)
Recoveries	120			17		912			50			1,099
Net (charge-offs) recoveries	(4,627		)	17		(12,513		)	(13		)	(17,136		)
Provision (negative provision)	9,936			8,003		(2,461		)	(478		)	15,000
Balance, end of period	$	45,467		$	26,210	$	58,806		$	1,656		$	132,139



	Six Months Ended June 30, 2018
				Real Estate
	Real Estate			Construction
	Mortgage			and Land		Commercial			Consumer			Total
	(In thousands)
Allowance for Loan and Lease Losses:
Balance, beginning of period ⁽¹⁾	$	40,051		$	13,055	$	84,022		$	2,328		$	139,456
Charge-offs	(7,345		)	—		(22,949		)	(94		)	(30,388		)
Recoveries	1,777			26		6,399			95			8,297
Net (charge-offs) recoveries	(5,568		)	26		(16,550		)	1			(22,091		)
Provision (negative provision)	10,984			13,129		(8,666		)	(673		)	14,774
Balance, end of period	$	45,467		$	26,210	$	58,806		$	1,656		$	132,139

Ending Allowance by
Impairment Methodology:
Individually evaluated for impairment	$	472		$	—	$	8,480		$	—		$	8,952
Collectively evaluated for impairment	$	44,995		$	26,210	$	50,326		$	1,656		$	123,187

Ending Loans and Leases by
Impairment Methodology:
Individually evaluated for impairment	$	83,931		$	15,998	$	67,228		$	—		$	167,157
Collectively evaluated for impairment	7,482,443			1,858,028		6,998,884			378,680			16,718,035
Ending balance	$	7,566,374		$	1,874,026	$	7,066,112		$	378,680		$	16,885,192

_______________________________________

(1)

The allowance for loan losses related to PCI loans of $6.4 million as of December 31, 2017 is reflected in the beginning balance of the allowance for loan and lease losses for the six months ended June 30, 2018.

Lease Income of Direct Financing Leases

The following table provides the components of leases receivable income for the period indicated:



	Three Months Ended		Six Months Ended
	June 30, 2019		June 30, 2019
	(In thousands)
Component of leases receivable income:
Interest income on net investments in leases	$	2,886	$	6,026

Assets and Liabilities, Lessor

The following table presents the components of leases receivable as of the date indicated:



	June 30, 2019
	(In thousands)
Net investment in direct financing leases:
Lease payments receivable	$	180,179
Unguaranteed residual assets	26,238
Deferred fees and other	849
Aggregate net investment in leases	$	207,266

Sales-type and Direct Financing Leases, Lease Receivable, Maturity

The following table presents maturities of leases receivable as of the date indicated:



	June 30, 2019
	(In thousands)
Period Ending December 31,
2019	$	35,758
2020	71,453
2021	50,719
2022	19,333
2023	11,265
Thereafter	8,763
Total undiscounted cash flows	197,291
Less: Unearned income	(17,112		)
Present value of lease payments	$	180,179