Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Components of Income Tax Expense (Benefit)

The components of income tax expense included in the consolidated statements of income for the years ended December 31, 2015, 2014, and 2013 are presented below:



(in thousands)	2015		2014	2013
Current
Federal	$	6,163	5,140	5,460
State	4,424		150	(2,630	)
Total current income tax expense	10,587		5,290	2,830
Deferred
Federal	108,877		92,360	78,870
State	13,027		9,660	11,545
Total deferred income tax expense	121,904		102,020	90,415
Total income tax expense	$	132,491	107,310	93,245

Note: The table above does not reflect amounts relating to share-based compensation transactions that were charged or credited directly to shareholders' equity. The amounts charged or credited to shareholder's equity for the years ended December 31, 2015, 2014, and 2013 were an increase of $1.7 million, a decrease of $3.2 million, and an increase of $317 thousand, respectively.

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the differences for the years ended December 31, 2015, 2014 and 2013 is shown below:



	Years Ended December 31,
(in thousands)	2015			2014		2013
Income tax expense at statutory federal income tax rate	$	125,501		105,896		88,420
Increase (decrease) resulting from:
State income tax expense, net of federal income tax effect	12,870			8,014		9,877
Tax-exempt income	(835		)	(1,076	)	(1,407	)
Tax credits	(1,173		)	(1,123	)	(1,473	)
Cash surrender value of life insurance	(2,885		)	(2,928	)	(2,932	)
Change in valuation allowance, federal and state	(589		)	(2,273	)	(4,083	)
Other, net	(398		)	800		4,843
Total income tax expense	$	132,491		107,310		93,245

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and liabilities at December 31, 2015 and 2014 are presented below.



(in thousands)	2015			2014
Deferred tax assets
Net operating loss carryforwards	$	308,617		422,968
Allowance for loan losses	103,884			111,814
Tax credit carryforwards	59,434			52,194
Deferred revenue	16,529			18,770
Share-based compensation	10,800			12,152
Non-performing loan interest	16,604			20,366
Net unrealized losses on investment securities available for sale	3,072			—
Other	28,950			34,576
Total gross deferred tax assets	547,890			672,840
Less valuation allowance	(11,713		)	(12,303	)
Total deferred tax assets	536,177			660,537
Deferred tax liabilities
Excess tax over financial statement depreciation	(8,564		)	(10,546	)
Net unrealized gains on investment securities available for sale	—			(7,893	)
Ownership interest in partnership	(4,537		)	(5,933	)
Fixed assets held for sale	(5,985		)	(7,287	)
Other	(5,143		)	(6,414	)
Total gross deferred tax liabilities	(24,229		)	(38,073	)
Net deferred tax asset	$	511,948		622,464

Schedule of Net Operating Loss and Tax Credit Carryforward

Federal and state NOL and tax credit carryforwards as of December 31, 2015 are summarized in the following table.



Tax Carryforwards	As of December 31, 2015
(in thousands)	Expiration Dates	Deferred Tax Asset Balance		Valuation Allowance		Net Deferred Tax Asset Balance	Pre-Tax Earnings Necessary to Realize
Net operating losses - federal	2030-2032	$	256,807	—		256,807	733,734
General business credits - federal	2028-2035	11,667		—		11,667	N/A⁽¹⁾
Net operating losses - states	2016-2019	10		—		10	689,362
Net operating losses - states	2024-2028	4,031		—		4,031	660,830
Net operating losses - states	2029-2035	54,674		—		54,674	1,744,165
Other credits - states	2016-2019	11,800		(11,713	)	87	N/A⁽¹⁾
Other credits - states	2020-2025	2,777		—		2,777	N/A⁽¹⁾
Alternative minimum tax credits - federal	None	31,745		—		31,745	N/A⁽²⁾
Other credits - states	None	1,445		—		1,445	N/A⁽¹⁾

⁽¹⁾N/A indicates credits are not measured on a pre-tax earnings basis

⁽²⁾Alternative minimum tax credits can be carried forward indefinitely.

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized income tax benefits is as follows (unrecognized state income tax benefits are not adjusted for the federal income tax impact).



	Years Ended December 31,
(in thousands)	2015			2014
Balance at January 1,	$	13,023		912
Additions based on income tax positions related to current year	—			—
Additions for income tax positions of prior years *	8			12,318
Deductions for income tax positions of prior years	—			(52	)
Statute of limitation expirations	(286		)	(155	)
Settlements	—			—
Balance at December 31,	$	12,745		13,023

* Includes deferred tax benefits that could reduce future tax liabilities.