Other Real Estate

6 Months Ended

Jun. 30, 2012

Other Real Estate and Foreclosed Assets [Abstract]

Other Real Estate

Other Real Estate

ORE consists of properties obtained through a foreclosure proceeding or through an in-substance foreclosure in satisfaction of loans. In accordance with provisions of ASC 310-10-35 regarding subsequent measurement of loans for impairment and ASC 310-40-15 regarding accounting for troubled debt restructurings by a creditor, a loan is classified as an in-substance foreclosure when Synovus has taken possession of the collateral regardless of whether formal foreclosure proceedings have taken place.

ORE is reported at the lower of cost or fair value determined on the basis of current appraisals, comparable sales, and other estimates of fair value obtained principally from independent sources, adjusted for estimated selling costs. Management also considers other factors or recent developments such as changes in absorption rates or market conditions from the time of valuation and anticipated sales values considering management’s plans for disposition, which could result in adjustment to lower the collateral value estimates indicated in the appraisals. At the time of foreclosure or initial possession of collateral, any excess of the loan balance over the fair value of the real estate held as collateral, less costs to sell, is recorded as a charge against the allowance for loan losses. Revenue and expenses from ORE operations as well as gains or losses on sales and any subsequent declines in fair value are recorded as foreclosed real estate expense, net, a component of non-interest expense on the consolidated statements of operations.

The carrying value of ORE was $174.9 million and $204.2 million at June 30, 2012 and December 31, 2011, respectively. During the six months ended June 30, 2012 and 2011, $75.1 million and $133.5 million respectively,of loans and other loans held for sale were foreclosed and transferred to other real estate at fair value. During the six months ended June 30, 2012 and 2011, Synovus recognized foreclosed real estate expense, net, of $43.7 million and $64.6 million, respectively. Synovus recognized foreclosed real estate expenses of $20.7 million and $39.9 million during the three months ended June 30, 2012 and 2011, respectively. These expenses included write-downs for declines in fair value of ORE subsequent to the date of foreclosure and net realized gains or losses resulting from sales transactions totaling $33.9 million and $54.5 million, for the six months ended June 30, 2012 and 2011, respectively, and $16.5 million and $35.9 million for the three months ended June 30, 2012 and 2011, respectively.