Allowance for Credit Losses and Credit Quality (Tables)

6 Months Ended

Jun. 30, 2020

Rollforwards of the allowance for loan and lease losses

The rollforwards of the allowance for credit losses were as follows:



(In thousands)	Consumer Loan Portfolio			Commercial Loan and Lease Portfolio			Total Allowance for Loan and Lease Losses			Reserve for Unfunded Lending Commitments⁽¹⁾			Total Allowance for Credit Losses
At or For the Three Months Ended June 30, 2020
Balance, beginning of period	$	175,057		$	231,326		$	406,383		$	22,188		$	428,571
Charge-offs	(4,997		)	(4,961		)	(9,958		)	—			(9,958		)
Recoveries	3,629			2,934			6,563			—			6,563
Net (charge-offs) recoveries	(1,368		)	(2,027		)	(3,395		)	—			(3,395		)
Provision for credit losses⁽²⁾	(16,004		)	74,130			58,126			20,600			78,726
Balance, end of period	$	157,685		$	303,429		$	461,114		$	42,788		$	503,902
At or For the Three Months Ended June 30, 2019
Balance, beginning of period	$	74,297		$	73,675		$	147,972		$	1,941		$	149,913
Charge-offs	(12,958		)	(8,108		)	(21,066		)	—			(21,066		)
Recoveries	5,653			1,331			6,984			—			6,984
Net (charge-offs) recoveries	(7,305		)	(6,777		)	(14,082		)	—			(14,082		)
Provision for credit losses⁽²⁾	4,693			8,876			13,569			(5		)	13,564
Other⁽³⁾	(974		)	18			(956		)	—			(956		)
Balance, end of period	$	70,711		$	75,792		$	146,503		$	1,936		$	148,439
At or For the Six Months Ended June 30, 2020
Balance, beginning of period	$	28,572		$	84,480		$	113,052		$	3,528		$	116,580
Impact of CECL adoption	107,337			98,655			205,992			14,707			220,699
Adjusted balance, beginning of period	135,909			183,135			319,044			18,235			337,279
Charge-offs	(10,845		)	(13,842		)	(24,687		)	—			(24,687		)
Recoveries	8,337			7,478			15,815			—			15,815
Net (charge-offs) recoveries	(2,508		)	(6,364		)	(8,872		)	—			(8,872		)
Provision for credit losses⁽²⁾	24,284			126,832			151,116			24,553			175,669
Other⁽³⁾	—			(174		)	(174		)	—			(174		)
Balance, end of period	$	157,685		$	303,429		$	461,114		$	42,788		$	503,902
At or For the Six Months Ended June 30, 2019
Balance, beginning of period	$	80,017		$	77,429		$	157,446		$	1,428		$	158,874
Charge-offs	(29,824		)	(15,673		)	(45,497		)	—			(45,497		)
Recoveries	10,510			2,251			12,761			—			12,761
Net (charge-offs) recoveries	(19,314		)	(13,422		)	(32,736		)	—			(32,736		)
Provision for credit losses⁽²⁾	11,951			11,740			23,691			508			24,199
Other⁽³⁾	(1,943		)	45			(1,898		)	—			(1,898		)
Balance, end of period	$	70,711		$	75,792		$	146,503		$	1,936		$	148,439


(1)	RULC is recognized within other liabilities.


(2)	As a result of the adoption of CECL, effective January 1, 2020, the provision for credit losses includes the provision for unfunded lending commitments that was previously included within other noninterest expense.


(3)	Primarily includes the transfer of the allowance for credit losses to loans and leases held-for-sale.

Rollforwards of the allowance for loan and lease losses

The rollforwards of the allowance for credit losses were as follows:



(In thousands)	Consumer Loan Portfolio			Commercial Loan and Lease Portfolio			Total Allowance for Loan and Lease Losses			Reserve for Unfunded Lending Commitments⁽¹⁾			Total Allowance for Credit Losses
At or For the Three Months Ended June 30, 2020
Balance, beginning of period	$	175,057		$	231,326		$	406,383		$	22,188		$	428,571
Charge-offs	(4,997		)	(4,961		)	(9,958		)	—			(9,958		)
Recoveries	3,629			2,934			6,563			—			6,563
Net (charge-offs) recoveries	(1,368		)	(2,027		)	(3,395		)	—			(3,395		)
Provision for credit losses⁽²⁾	(16,004		)	74,130			58,126			20,600			78,726
Balance, end of period	$	157,685		$	303,429		$	461,114		$	42,788		$	503,902
At or For the Three Months Ended June 30, 2019
Balance, beginning of period	$	74,297		$	73,675		$	147,972		$	1,941		$	149,913
Charge-offs	(12,958		)	(8,108		)	(21,066		)	—			(21,066		)
Recoveries	5,653			1,331			6,984			—			6,984
Net (charge-offs) recoveries	(7,305		)	(6,777		)	(14,082		)	—			(14,082		)
Provision for credit losses⁽²⁾	4,693			8,876			13,569			(5		)	13,564
Other⁽³⁾	(974		)	18			(956		)	—			(956		)
Balance, end of period	$	70,711		$	75,792		$	146,503		$	1,936		$	148,439
At or For the Six Months Ended June 30, 2020
Balance, beginning of period	$	28,572		$	84,480		$	113,052		$	3,528		$	116,580
Impact of CECL adoption	107,337			98,655			205,992			14,707			220,699
Adjusted balance, beginning of period	135,909			183,135			319,044			18,235			337,279
Charge-offs	(10,845		)	(13,842		)	(24,687		)	—			(24,687		)
Recoveries	8,337			7,478			15,815			—			15,815
Net (charge-offs) recoveries	(2,508		)	(6,364		)	(8,872		)	—			(8,872		)
Provision for credit losses⁽²⁾	24,284			126,832			151,116			24,553			175,669
Other⁽³⁾	—			(174		)	(174		)	—			(174		)
Balance, end of period	$	157,685		$	303,429		$	461,114		$	42,788		$	503,902
At or For the Six Months Ended June 30, 2019
Balance, beginning of period	$	80,017		$	77,429		$	157,446		$	1,428		$	158,874
Charge-offs	(29,824		)	(15,673		)	(45,497		)	—			(45,497		)
Recoveries	10,510			2,251			12,761			—			12,761
Net (charge-offs) recoveries	(19,314		)	(13,422		)	(32,736		)	—			(32,736		)
Provision for credit losses⁽²⁾	11,951			11,740			23,691			508			24,199
Other⁽³⁾	(1,943		)	45			(1,898		)	—			(1,898		)
Balance, end of period	$	70,711		$	75,792		$	146,503		$	1,936		$	148,439


(1)	RULC is recognized within other liabilities.


(2)	As a result of the adoption of CECL, effective January 1, 2020, the provision for credit losses includes the provision for unfunded lending commitments that was previously included within other noninterest expense.


(3)	Primarily includes the transfer of the allowance for credit losses to loans and leases held-for-sale.

Allowance for loan and lease losses and balances by type of allowance methodology

The allowance for loan and lease losses and loans and leases outstanding by type of allowance methodology was as follows:



	At December 31, 2019
(In thousands)	Consumer Loan Portfolio		Commercial Loan and Lease Portfolio		Total Loans and Leases
Allowance for loan and lease losses
Collectively evaluated for impairment	$	26,430	$	75,756	$	102,186
Individually evaluated for impairment	1,468		5,769		7,237
Loans acquired with deteriorated credit quality	674		2,955		3,629
Total	$	28,572	$	84,480	$	113,052
Loans and leases outstanding
Collectively evaluated for impairment	$	11,087,534	$	22,986,607	$	34,074,141
Individually evaluated for impairment	60,694		115,843		176,537
Loans acquired with deteriorated credit quality	72,895		173,891		246,786
Total	$	11,221,123	$	23,276,341	$	34,497,464

Information on impaired loans

Information on impaired loans and leases at December 31, 2019 was as follows:



	At December 31, 2019
(In thousands)	Unpaid Contractual Balance		Loan and Lease Balance		Related Allowance Recorded
Impaired loans and leases with an allowance recorded:
Commercial loan and lease portfolio:
Commercial and industrial	$	20,069	$	20,090	$	2,844
Commercial real estate	4,225		3,962		333
Lease financing	10,956		10,956		2,592
Total commercial loan and lease portfolio	35,250		35,008		5,769
Consumer loan portfolio:
Residential mortgage	24,297		22,250		1,030
Home equity	9,418		8,791		438
Total consumer loan portfolio	33,715		31,041		1,468
Total impaired loans and leases with an allowance recorded	68,965		66,049		7,237
Impaired loans and leases without an allowance recorded:
Commercial loan and lease portfolio:
Commercial and industrial	55,889		39,098		—
Commercial real estate	69,143		41,737		—
Total commercial loan and lease portfolio	125,032		80,835		—
Consumer loan portfolio:
Residential mortgage	31,142		22,594		—
Consumer installment	2,095		880		—
Home equity	24,709		6,179		—
Total consumer loan portfolio	57,946		29,653		—
Total impaired loans and leases without an allowance recorded	182,978		110,488		—
Total impaired loans and leases	$	251,943	$	176,537	$	7,237

The average balance of nonaccrual loans and leases and interest income recognized on nonaccrual loans and leases were as follows:



	Three Months Ended June 30,								Six Months Ended June 30,
	2020				2019				2020				2019
(In thousands)	Average Loan and Lease Balance⁽¹⁾		Interest Income Recognized⁽¹⁾		Average Loan and Lease Balance		Interest Income Recognized		Average Loan and Lease Balance		Interest Income Recognized		Average Loan and Lease Balance		Interest Income Recognized
Commercial loan and lease portfolio:
Commercial and industrial	$	91,171	$	1,959	$	17,816	$	51	$	75,998	$	3,668	$	22,272	$	122
Commercial real estate	52,277		1,746		576		63		43,628		3,530		2,531		63
Lease financing	15,963		20		11,932		27		14,856		71		10,440		61
Total commercial loan and lease portfolio	159,411		3,725		30,324		141		134,482		7,269		35,243		246
Consumer loan portfolio:
Residential mortgage	64,870		726		34,993		59		53,170		1,364		33,935		137
Consumer installment	1,328		41		8,833		—		1,191		66		8,607		—
Home equity	45,354		127		31,489		55		41,711		283		29,171		95
Total consumer loan portfolio	111,552		894		75,315		114		96,072		1,713		71,713		232
Total nonaccrual loans and leases	$	270,963	$	4,619	$	105,639	$	255	$	230,554	$	8,982	$	106,956	$	478

Schedule of accruing and non-accruing loans and leases

The Corporation's accruing and nonaccrual loans and leases were as follows:



(In thousands)	Current		30-89 Days Delinquent and Accruing		90 Days or More Delinquent and Accruing		Total Accruing		Nonaccrual⁽¹⁾		Total
At June 30, 2020
Commercial loan and lease portfolio:
Commercial and industrial	$	12,043,000	$	57,542	$	1,995	$	12,102,537	$	98,184	$	12,200,721
Commercial real estate	9,517,890		52,560		373		9,570,823		57,521		9,628,344
Lease financing	2,641,554		42,193		4,899		2,688,646		18,756		2,707,402
Total commercial loan and lease portfolio	24,202,444		152,295		7,267		24,362,006		174,461		24,536,467
Consumer loan portfolio:
Residential mortgage	6,037,390		17,217		749		6,055,356		67,762		6,123,118
Consumer installment	1,426,008		2,979		—		1,428,987		1,668		1,430,655
Home equity	3,385,539		12,485		—		3,398,024		47,560		3,445,584
Total consumer loan portfolio	10,848,937		32,681		749		10,882,367		116,990		10,999,357
Total	$	35,051,381	$	184,976	$	8,016	$	35,244,373	$	291,451	$	35,535,824
At December 31, 2019
Commercial loan and lease portfolio:
Commercial and industrial	$	11,283,832	$	29,780	$	331	$	11,313,943	$	53,812	$	11,367,755
Commercial real estate	8,993,360		10,291		1,440		9,005,091		29,735		9,034,826
Lease financing	2,662,354		24,657		1,901		2,688,912		10,957		2,699,869
Total commercial loan and lease portfolio	22,939,546		64,728		3,672		23,007,946		94,504		23,102,450
Consumer loan portfolio:
Residential mortgage	6,056,817		17,245		559		6,074,621		38,577		6,113,198
Consumer installment	1,536,714		4,292		108		1,541,114		714		1,541,828
Home equity	3,434,771		22,568		—		3,457,339		35,863		3,493,202
Total consumer loan portfolio	11,028,302		44,105		667		11,073,074		75,154		11,148,228
Purchased credit impaired loans⁽¹⁾	217,206		3,843		25,737		246,786		—		246,786
Total	$	34,185,054	$	112,676	$	30,076	$	34,327,806	$	169,658	$	34,497,464

(1)

Prior to the adoption of CECL as of January 1, 2020, purchased credit impaired loans were not classified as nonaccrual loans because they were recorded at their net realizable value based on the principal and interest expected to be collected on the loans. At January 1, 2020, $73.4 million of previous purchased credit impaired loans were reclassified to nonaccrual loans as a result of the adoption of CECL.

Financing receivable credit quality indicators

The amortized cost basis of loans and leases by credit risk classifications and year of origination was as follows:



	Amortized Cost Basis
(In thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases⁽¹⁾		Revolving Loans and Leases Converted to Term Loans and Leases⁽²⁾
At June 30, 2020	2020		2019		2018		2017		2016		2015 and Prior						Total
Commercial loan and lease portfolio:
Commercial and industrial
Pass	$	2,870,840	$	2,324,427	$	1,178,500	$	701,249	$	401,396	$	358,937	$	3,786,856	$	41,929	$	11,664,134
Special mention	21,404		30,925		68,788		20,061		6,686		8,298		129,718		—		285,880
Substandard	2,980		30,502		33,139		29,763		23,800		23,587		106,927		9		250,707
Total commercial and industrial	2,895,224		2,385,854		1,280,427		751,073		431,882		390,822		4,023,501		41,938		12,200,721
Commercial real estate
Pass	947,705		2,333,832		2,105,250		1,557,798		791,144		1,274,833		109,791		—		9,120,353
Special mention	1,994		40,041		42,127		98,648		42,644		77,196		261		—		302,911
Substandard	—		34,172		9,398		74,172		16,386		70,952		—		—		205,080
Total commercial real estate	949,699		2,408,045		2,156,775		1,730,618		850,174		1,422,981		110,052		—		9,628,344
Lease financing
Pass	492,516		869,060		504,714		314,348		177,670		67,231		34,276		176,789		2,636,604
Special mention	1,390		10,818		4,742		5,201		3,270		2,120		3,837		6,173		37,551
Substandard	3,761		6,218		5,696		6,519		3,463		3,478		900		3,212		33,247
Total lease financing	497,667		886,096		515,152		326,068		184,403		72,829		39,013		186,174		2,707,402
Total commercial	4,342,590		5,679,995		3,952,354		2,807,759		1,466,459		1,886,632		4,172,566		228,112		24,536,467
Consumer loan portfolio:
Residential mortgage
Pass	814,910		1,360,556		870,577		582,465		562,440		1,842,690		—		15,799		6,049,437
Special mention	—		391		—		—		—		1,531		—		—		1,922
Substandard	269		1,922		3,271		3,998		2,406		58,808		—		1,085		71,759
Total residential mortgage	815,179		1,362,869		873,848		586,463		564,846		1,903,029		—		16,884		6,123,118
Consumer installment
Pass	149,212		447,414		236,490		239,163		164,156		159,931		32,334		73		1,428,773
Substandard	54		365		243		329		217		567		107		—		1,882
Total consumer installment	149,266		447,779		236,733		239,492		164,373		160,498		32,441		73		1,430,655
Home equity
Pass	20,297		63,096		61,983		50,597		36,899		143,980		2,981,806		37,149		3,395,807
Special mention	—		266		—		37		—		372		30		—		705
Substandard	953		1,973		701		354		207		3,761		39,117		2,006		49,072
Total home equity	21,250		65,335		62,684		50,988		37,106		148,113		3,020,953		39,155		3,445,584
Total consumer	985,695		1,875,983		1,173,265		876,943		766,325		2,211,640		3,053,394		56,112		10,999,357
Total loans and leases	$	5,328,285	$	7,555,978	$	5,125,619	$	3,684,702	$	2,232,784	$	4,098,272	$	7,225,960	$	284,224	$	35,535,824


(1)	This balance includes $39.0 million of leased equipment that has been provided to lessees under certain master lease agreements. Under these agreements, the total amount of equipment included in each lease is provided over time, and additional amounts are required to be provided to the respective lessees in future accounting periods.

(2)

This balance includes $228.1 million of leased equipment that has been provided to lessees under certain master lease agreements. Under these agreements, the total amount of equipment included in each lease was provided over time, and all equipment required by the lease has been provided to the respective lessees in current or previous accounting periods.

The recorded investment of loans and leases by credit risk categories as of December 31, 2019 was as follows:



(In thousands)	Pass		Special Mention		Substandard		Total
At December 31, 2019
Commercial loan and lease portfolio:
Commercial and industrial	$	10,930,939	$	315,097	$	193,566	$	11,439,602
Commercial real estate	8,891,361		170,114		75,395		9,136,870
Lease financing	2,646,874		28,091		24,904		2,699,869
Total commercial loan and lease portfolio	22,469,174		513,302		293,865		23,276,341
Consumer loan portfolio:
Residential mortgage	6,135,096		565		44,144		6,179,805
Consumer installment	1,541,524		—		887		1,542,411
Home equity	3,457,292		456		41,159		3,498,907
Total consumer loan portfolio	11,133,912		1,021		86,190		11,221,123
Total loans and leases	$	33,603,086	$	514,323	$	380,055	$	34,497,464

Loans and leases that are 90 days or more delinquent and accruing by year of origination were as follows:



			Amortized Cost Basis
(In thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Revolving Loans and Leases Converted to Term Loans and Leases
At June 30, 2020	2020		2019		2018		2017		2016		2015 and Prior		Revolving Loans and Leases				Total
Commercial loan and lease portfolio:
Commercial and industrial	$	—	$	1,322	$	3	$	97	$	15	$	284	$	274	$	—	$	1,995
Commercial real estate	—		—		—		—		—		373		—		—		373
Lease financing	835		1,631		1,199		802		218		214		—		—		4,899
Total commercial loan and lease portfolio	835		2,953		1,202		899		233		871		274		—		7,267
Consumer loan portfolio:
Residential mortgage	—		—		—		—		—		749		—		—		749
Total consumer loan portfolio	—		—		—		—		—		749		—		—		749
Total 90 days or more delinquent and accruing	$	835	$	2,953	$	1,202	$	899	$	233	$	1,620	$	274	$	—	$	8,016

Nonaccrual loans and leases by year of origination were as follows:



			Amortized Cost Basis
(In thousands)	Term Loans and Leases by Origination Year												Revolving Loans and Leases		Revolving Loans and Leases Converted to Term Loans and Leases
At June 30, 2020	2020		2019		2018		2017		2016		2015 and Prior		Revolving Loans and Leases				Total
Commercial loan and lease portfolio:
Commercial and industrial	$	1,190	$	19,942	$	13,183	$	12,758	$	8,493	$	16,854	$	25,764	$	—	$	98,184
Commercial real estate	—		219		5,057		7,427		9,158		35,660		—		—		57,521
Lease financing	309		3,941		4,239		4,489		2,461		2,350		—		967		18,756
Total commercial loan and lease portfolio	1,499		24,102		22,479		24,674		20,112		54,864		25,764		967		174,461
Consumer loan portfolio:
Residential mortgage	269		1,788		3,271		3,865		1,966		55,518		—		1,085		67,762
Consumer installment	18		196		243		329		217		566		99		—		1,668
Home equity	729		1,757		629		354		207		3,729		38,159		1,996		47,560
Total consumer loan portfolio	1,016		3,741		4,143		4,548		2,390		59,813		38,258		3,081		116,990
Total nonaccrual loans and leases	$	2,515	$	27,843	$	26,622	$	29,222	$	22,502	$	114,677	$	64,022	$	4,048	$	291,451

Schedule of TDR loans

The following table presents the recorded investment of loan modifications first classified as TDRs during the periods presented:



	Three Months Ended June 30,								Six Months Ended June 30,
	2020				2019				2020				2019
(In thousands)	Pre-modification Investment		Post-modification Investment		Pre-modification Investment		Post-modification Investment		Pre-modification Investment		Post-modification Investment		Pre-modification Investment		Post-modification Investment
Commercial loan and lease portfolio:
Commercial and industrial	$	4,875	$	4,875	$	31,311	$	31,311	$	7,346	$	7,346	$	32,505	$	32,505
Commercial real estate	2,629		2,629		—		—		2,735		2,735		—		—
Total commercial loan and lease portfolio	7,504		7,504		31,311		31,311		10,081		10,081		32,505		32,505
Consumer loan portfolio:
Residential mortgage	2,373		2,373		1,107		1,107		5,581		5,580		2,360		2,353
Consumer installment	134		67		257		257		511		420		630		630
Home equity	1,099		1,041		877		877		2,066		2,008		2,515		2,503
Total consumer loan portfolio	3,606		3,481		2,241		2,241		8,158		8,008		5,505		5,486
Total	$	11,110	$	10,985	$	33,552	$	33,552	$	18,239	$	18,089	$	38,010	$	37,991

The following table presents TDR loans:



	At June 30, 2020						At December 31, 2019
(In thousands)	Accruing TDR Loans		Nonaccrual TDR Loans		Total TDR Loans		Accruing TDR Loans		Nonaccrual TDR Loans		Total TDR Loans
Commercial loan and lease portfolio	$	13,707	$	10,630	$	24,337	$	12,986	$	5,356	$	18,342
Consumer loan portfolio	14,507		18,476		32,983		12,403		14,875		27,278
Total	$	28,214	$	29,106	$	57,320	$	25,389	$	20,231	$	45,620

The following table summarizes the TDR loans that defaulted during the periods presented that were modified during the respective reporting period or within one year of the beginning of the respective reporting period. The Corporation considers a loan to have defaulted when under the modified terms it becomes 90 or more days delinquent, has been transferred to nonaccrual status, has been charged down or has been transferred to other real estate owned or repossessed and returned assets.



	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2020		2019		2020		2019
Defaulted TDR loan balances modified during the applicable period
Commercial loan and lease portfolio:
Commercial and industrial	$	223	$	297	$	223	$	297
Consumer loan portfolio:
Residential mortgage	509		432		1,139		622
Consumer installment	15		447		15		1,017
Home equity	197		282		256		376
Total consumer loan portfolio	721		1,161		1,410		2,015
Defaulted TDR loan balances	$	944	$	1,458	$	1,633	$	2,312

Schedule of other real estate owned and repossessed and returned assets

Other real estate owned and repossessed and returned assets were as follows:



(In thousands)	At June 30, 2020		At December 31, 2019
Other real estate owned	$	42,744	$	34,256
Repossessed and returned assets	10,060		8,045
Consumer loans in process of foreclosure	17,709		17,758