Loans, Allowance for Loan and Lease Losses, and Reserve for Off-Balance Sheet Credit Commitments (Tables)

6 Months Ended

Jun. 30, 2014

Loans, Allowance for Loan and Lease Losses, and Reserve for Off-Balance Sheet Credit Commitments

Summary of loans

	June 30,			December 31,
(in thousands) (1)	2014			2013
Commercial	$	8,230,112		$	7,562,300
Commercial real estate mortgages	3,464,918			3,223,001
Residential mortgages	4,814,435			4,554,311
Real estate construction	457,557			367,004
Home equity loans and lines of credit	716,816			709,344
Installment	183,518			151,955
Lease financing	607,432			602,523
Loans and leases, excluding covered loans	18,474,788			17,170,438
Less: Allowance for loan and lease losses	(311,276		)	(302,584		)
Loans and leases, excluding covered loans, net	18,163,512			16,867,854
Covered loans	605,770			716,911
Less: Allowance for loan losses	(9,103		)	(15,922		)
Covered loans, net	596,667			700,989
Total loans and leases	$	19,080,558		$	17,887,349
Total loans and leases, net	$	18,760,179		$	17,568,843

(1)  Commercial loans as of December 31, 2013 have been corrected to include $158.2 million of loans that were previously reported as lease financing.

Summary of major categories of covered loans

	June 30,			December 31,
(in thousands)	2014			2013
Commercial	$	6,992		$	10,009
Commercial real estate mortgages	568,902			666,628
Residential mortgages	5,525			4,976
Real estate construction	20,742			31,184
Home equity loans and lines of credit	3,342			3,695
Installment	267			419
Covered loans	605,770			716,911
Less: Allowance for loan losses	(9,103		)	(15,922		)
Covered loans, net	$	596,667		$	700,989

Schedule of information on covered loans and loss-sharing terms by acquired entity

	Imperial						Nevada
	Capital		1st Pacific		Sun West		Commerce
(in thousands)	Bank		Bank		Bank		Bank		Total
Covered loans as of:
June 30, 2014	$	536,292	$	32,320	$	13,651	$	23,507	$	605,770
December 31, 2013	630,754		40,110		18,761		27,286		716,911
As of June 30, 2014:
FDIC indemnification asset	$	57,624	$	2,368	$	4,137	$	3,909	$	68,038
FDIC clawback liability	—		12,122		1,925		32		14,079
Expiration date of FDIC loss sharing:
Commercial (1)	12/31/2016		6/30/2015		6/30/2015		6/30/2016
Residential	12/31/2019		5/31/2020		5/31/2020		4/30/2021
Termination date of FDIC loss-sharing agreements:
Commercial (1)	12/19/2017		5/8/2018		5/29/2018		6/30/2019
Residential	12/31/2019		5/31/2020		5/31/2020		4/30/2021

(1)  The Company is subject to sharing 80 percent of its recoveries with the FDIC up to the last day of the quarter in which the termination dates of the commercial loss-sharing agreements occur.

Summary of accretable yield for acquired impaired loans

	For the six months ended June 30,
(in thousands)	2014			2013
Balance, beginning of period	$	219,018		$	295,813
Accretion	(24,907		)	(33,221		)
Reclassifications from nonaccretable difference	18,965			15,978
Disposals and other	(16,198		)	(24,605		)
Balance, end of period	$	196,878		$	253,965

Summary of allowance for loan and lease losses on non-covered loans

(in thousands)	Commercial (1)			Commercial Real Estate Mortgages			Residential Mortgages			Real Estate Construction			Home Equity Loans and Lines of Credit			Installment			Qualitative			Total
Three months ended June 30, 2014
Allowance for loan and lease losses:
Beginning balance	$	121,574		$	51,361		$	11,595		$	6,468		$	6,419		$	1,824		$	106,549		$	305,790
Charge-offs	(12,862		)	—			—			—			(149		)	(142		)	—			(13,153		)
Recoveries	7,503			27			190			687			43			1,068			—			9,518
Net (charge-offs) recoveries	(5,359		)	27			190			687			(106		)	926			—			(3,635		)
(Reversal of) provision for credit losses	711			(737		)	(1,489		)	36			262			(466		)	683			(1,000		)
Transfers from reserve for off-balance sheet credit commitments	9,353			—			—			—			—			—			768			10,121
Ending balance	$	126,279		$	50,651		$	10,296		$	7,191		$	6,575		$	2,284		$	108,000		$	311,276
Six months ended June 30, 2014
Allowance for loan and lease losses:
Beginning balance	$	117,103		$	50,678		$	11,540		$	6,351		$	6,677		$	1,842		$	108,393		$	302,584
Charge-offs	(14,821		)	(5		)	(482		)	—			(165		)	(188		)	—			(15,661		)
Recoveries	9,235			127			225			5,075			202			1,332			—			16,196
Net (charge-offs) recoveries	(5,586		)	122			(257		)	5,075			37			1,144			—			535
(Reversal of) provision for credit losses	5,409			(149		)	(987		)	(4,235		)	(139		)	(702		)	(197		)	(1,000		)
Transfers from (to) reserve for off-balance sheet credit commitments	9,353			—			—			—			—			—			(196		)	9,157
Ending balance	$	126,279		$	50,651		$	10,296		$	7,191		$	6,575		$	2,284		$	108,000		$	311,276
Ending balance of allowance:
Individually evaluated for impairment	$	8,477		$	301		$	5		$	—		$	—		$	50		$	—		$	8,833
Collectively evaluated for impairment	117,802			50,350			10,291			7,191			6,575			2,234			108,000			302,443
Loans and leases, excluding covered loans
Ending balance of loans and leases:
Loans and leases, excluding covered loans	$	8,837,544		$	3,464,918		$	4,814,435		$	457,557		$	716,816		$	183,518		$	—		$	18,474,788
Individually evaluated for impairment	29,231			33,456			10,596			12,846			3,436			50			—			89,615
Collectively evaluated for impairment	8,808,313			3,431,462			4,803,839			444,711			713,380			183,468			—			18,385,173

(1) Includes lease financing loans.

(in thousands) (2)	Commercial (1)			Commercial Real Estate Mortgages			Residential Mortgages			Real Estate Construction			Home Equity Loans and Lines of Credit			Installment			Qualitative			Total
Three months ended June 30, 2013
Allowance for loan and lease losses:
Beginning balance	$	112,748		$	52,016		$	7,253		$	9,962		$	4,843		$	1,225		$	94,281		$	282,328
Charge-offs	(2,869		)	—			(1		)	(100		)	(35		)	(81		)	—			(3,086		)
Recoveries	5,724			1,034			38			2,782			410			603			—			10,591
Net recoveries (charge-offs)	2,855			1,034			37			2,682			375			522			—			7,505
(Reversal of) provision for credit losses	1,016			289			714			(4,309		)	182			(392		)	2,500			—
Transfers from reserve for off-balance sheet credit commitments	—			—			—			—			—			—			81			81
Ending balance	$	116,619		$	53,339		$	8,004		$	8,335		$	5,400		$	1,355		$	96,862		$	289,914
Six months ended June 30, 2013
Allowance for loan and lease losses:
Beginning balance	$	104,731		$	48,901		$	10,558		$	11,784		$	7,283		$	1,858		$	92,773		$	277,888
Charge-offs	(4,231		)	(45		)	(106		)	(100		)	(275		)	(352		)	—			(5,109		)
Recoveries	9,259			1,082			75			5,448			538			1,020			—			17,422
Net recoveries (charge-offs)	5,028			1,037			(31		)	5,348			263			668			—			12,313
(Reversal of) provision for credit losses	6,860			3,401			(2,523		)	(8,797		)	(2,146		)	(1,171		)	4,376			—
Transfers to reserve for off-balance sheet credit commitments	—			—			—			—			—			—			(287		)	(287		)
Ending balance	$	116,619		$	53,339		$	8,004		$	8,335		$	5,400		$	1,355		$	96,862		$	289,914
Ending balance of allowance:
Individually evaluated for impairment	$	478		$	2,252		$	230		$	—		$	—		$	—		$	—		$	2,960
Collectively evaluated for impairment	116,141			51,087			7,774			8,335			5,400			1,355			96,862			286,954
Loans and leases, excluding covered loans
Ending balance of loans and leases:
Loans and leases, excluding covered loans	$	7,497,105		$	2,978,975		$	4,153,051		$	340,002		$	700,681		$	149,438		$	—		$	15,819,252
Individually evaluated for impairment	34,915			41,932			7,979			30,446			3,257			—			—			118,529
Collectively evaluated for impairment	7,462,190			2,937,043			4,145,072			309,556			697,424			149,438			—			15,700,723

(1) Includes lease financing loans.

(2) Certain balances for the three and six months ended June 30, 2013 have been revised as a result of correcting the real estate construction loan balance to include loans that were previously reported as commercial real estate mortgages.

Summary of activity in the reserve for off-balance sheet credit commitments

	For the three months ended June 30,						For the six months ended June 30,
(in thousands)	2014			2013			2014			2013
Balance, beginning of period	$	34,908		$	25,205		$	33,944		$	24,837
Transfers (to) from allowance for loan and lease losses	(10,121		)	(81		)	(9,157		)	287
Balance, end of period	$	24,787		$	25,124		$	24,787		$	25,124

Schedule of impaired loans, excluding covered loans

			Unpaid				For the three months ended June 30, 2014				For the six months ended June 30, 2014
(in thousands)	Recorded Investment		Contractual Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
June 30, 2014
With no related allowance recorded:
Commercial	$	6,980	$	7,713	$	—	$	9,118	$	30	$	11,986	$	167
Commercial real estate mortgages	28,233		30,829		—		32,398		246		32,522		684
Residential mortgages:
Fixed	4,796		5,012		—		4,842		10		3,940		20
Variable	1,799		1,922		—		2,408		14		3,406		28
Total residential mortgages	6,595		6,934		—		7,250		24		7,346		48
Real estate construction:
Construction	—		—		—		2,742		21		3,656		76
Land	12,846		26,520		—		13,075		35		13,254		69
Total real estate construction	12,846		26,520		—		15,817		56		16,910		145
Home equity loans and lines of credit	3,436		4,505		—		3,442		—		3,071		—
Installment:
Consumer	—		—		—		—		—		5		—
Total installment	—		—		—		—		—		5		—
Total with no related allowance	$	58,090	$	76,501	$	—	$	68,025	$	356	$	71,840	$	1,044
With an allowance recorded:
Commercial	$	22,251	$	28,454	$	8,477	$	19,839	$	—	$	17,938	$	—
Commercial real estate mortgages	5,223		5,586		301		5,293		74		5,323		118
Residential mortgages:
Variable	4,001		3,993		5		2,001		11		1,892		11
Total residential mortgages	4,001		3,993		5		2,001		11		1,892		11
Installment:
Consumer	50		50		50		25		1		17		1
Total installment	50		50		50		25		1		17		1
Total with an allowance	$	31,525	$	38,083	$	8,833	$	27,158	$	86	$	25,170	$	130
Total impaired loans by type:
Commercial	$	29,231	$	36,167	$	8,477	$	28,957	$	30	$	29,924	$	167
Commercial real estate mortgages	33,456		36,415		301		37,691		320		37,845		802
Residential mortgages	10,596		10,927		5		9,251		35		9,238		59
Real estate construction	12,846		26,520		—		15,817		56		16,910		145
Home equity loans and lines of credit	3,436		4,505		—		3,442		—		3,071		—
Installment	50		50		50		25		1		22		1
Total impaired loans	$	89,615	$	114,584	$	8,833	$	95,183	$	442	$	97,010	$	1,174

(in thousands)	Recorded Investment		Unpaid Contractual Principal Balance		Related Allowance
Year ended December 31, 2013
With no related allowance recorded:
Commercial	$	17,721	$	18,041	$	—
Commercial real estate mortgages	32,770		37,555		—
Residential mortgages:
Fixed	2,135		2,295		—
Variable	5,402		5,783		—
Total residential mortgages	7,537		8,078		—
Real estate construction:
Construction	5,485		6,766		—
Land	13,612		26,928		—
Total real estate construction	19,097		33,694		—
Home equity loans and lines of credit	2,329		3,375		—
Installment:
Consumer	16		24		—
Total installment	16		24		—
Total with no related allowance	$	79,470	$	100,767	$	—
With an allowance recorded:
Commercial	$	14,136	$	18,156	$	1,961
Commercial real estate mortgages	5,384		5,764		586
Residential mortgages:
Variable	1,674		1,687		478
Total residential mortgages	1,674		1,687		478
Total with an allowance	$	21,194	$	25,607	$	3,025
Total impaired loans by type:
Commercial	$	31,857	$	36,197	$	1,961
Commercial real estate mortgages	38,154		43,319		586
Residential mortgages	9,211		9,765		478
Real estate construction	19,097		33,694		—
Home equity loans and lines of credit	2,329		3,375		—
Installment	16		24		—
Total impaired loans	$	100,664	$	126,374	$	3,025

			Unpaid				For the three months ended June 30, 2013				For the six months ended June 30, 2013
(in thousands)	Recorded Investment		Contractual Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
June 30, 2013
With no related allowance recorded:
Commercial	$	27,276	$	28,029	$	—	$	23,171	$	428	$	21,701	$	847
Commercial real estate mortgages	26,821		31,116		—		28,112		427		33,035		662
Residential mortgages:
Fixed	2,008		2,356		—		2,963		24		3,136		42
Variable	4,277		4,619		—		4,161		55		4,396		69
Total residential mortgages	6,285		6,975		—		7,124		79		7,532		111
Real estate construction:
Construction	16,265		21,064		—		17,799		228		18,453		558
Land	14,181		27,156		—		13,172		253		17,364		287
Total real estate construction	30,446		48,220		—		30,971		481		35,817		845
Home equity loans and lines of credit	3,257		4,310		—		2,698		34		2,986		34
Installment:
Consumer	—		—		—		—		—		150		—
Total installment	—		—		—		—		—		150		—
Total with no related allowance	$	94,085	$	118,650	$	—	$	92,076	$	1,449	$	101,221	$	2,499
With an allowance recorded:
Commercial	$	7,639	$	9,170	$	478	$	7,606	$	311	$	7,576	$	357
Commercial real estate mortgages	15,111		15,963		2,252		14,228		148		12,886		316
Residential mortgages:
Fixed	—		—		—		—		—		154		—
Variable	1,694		1,688		230		847		41		565		41
Total residential mortgages	1,694		1,688		230		847		41		719		41
Real estate construction:
Land	—		—		—		6,425		—		4,283		213
Total real estate construction	—		—		—		6,425		—		4,283		213
Home equity loans and lines of credit	—		—		—		—		—		300		—
Total with an allowance	$	24,444	$	26,821	$	2,960	$	29,106	$	500	$	25,764	$	927
Total impaired loans by type:
Commercial	$	34,915	$	37,199	$	478	$	30,777	$	739	$	29,277	$	1,204
Commercial real estate mortgages	41,932		47,079		2,252		42,340		575		45,921		978
Residential mortgages	7,979		8,663		230		7,971		120		8,251		152
Real estate construction	30,446		48,220		—		37,396		481		40,100		1,058
Home equity loans and lines of credit	3,257		4,310		—		2,698		34		3,286		34
Installment	—		—		—		—		—		150		—
Total impaired loans	$	118,529	$	145,471	$	2,960	$	121,182	$	1,949	$	126,985	$	3,426

Schedule of troubled debt restructured loans

(in thousands)	Number of Contracts	Pre-Modification Outstanding Principal		Period-End Outstanding Principal		Financial Effects (1)
Three months ended June 30, 2014
Residential mortgages:
Variable	1	$	4,000	$	3,993	$	5
Installment:
Consumer	1	50		50		50
Total troubled debt restructured loans	2	$	4,050	$	4,043	$	55
Three months ended June 30, 2013
Commercial	6	$	6,956	$	6,926	$	—
Commercial real estate mortgages	1	547		547		—
Total troubled debt restructured loans	7	$	7,503	$	7,473	$	—

(1) Financial effects are comprised of charge-offs and specific reserves recognized on TDR loans at modification date.

(in thousands)	Number of Contracts	Pre-Modification Outstanding Principal		Period-End Outstanding Principal		Financial Effects (1)
Six months ended June 30, 2014
Commercial	2	$	4,098	$	3,967	$	—
Residential mortgages:
Variable	2	4,676		4,669		5
Installment:
Consumer	1	50		50		50
Total troubled debt restructured loans	5	$	8,824	$	8,686	$	55
Six months ended June 30, 2013
Commercial	10	$	8,683	$	8,336	$	—
Commercial real estate mortgages	1	547		547
Home equity loans and lines of credit	1	345		—		—
Total troubled debt restructured loans	12	$	9,575	$	8,883	$	—

(1) Financial effects are comprised of charge-offs and specific reserves recognized on TDR loans at modification date.

Schedule of troubled debt restructured loans that have subsequently defaulted

	For three months ended June 30, 2013					For six months ended June 30, 2013
(in thousands)	Number of Contracts	Period-End Outstanding Principal		Period-End Specific Reserve		Number of Contracts	Period-End Outstanding Principal		Period-End Specific Reserve
Commercial	2	$	427	$	—	4	$	1,487	$	—
Real estate construction:
Land	1	7,491		—		1	7,491		—
Home equity loans and lines of credit	—	—		—		1	141		—
Total loans that subsequently defaulted	3	$	7,918	$	—	6	$	9,119	$	—

Summary of past due loans, excluding covered loans, based upon the length of time the loans have been past due

(in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days and Accruing		Nonaccrual		Total Past Due and Nonaccrual Loans		Current		Total Loans and Leases
June 30, 2014
Commercial	$	6,924	$	2,702	$	—	$	27,314	$	36,940	$	8,193,172	$	8,230,112
Commercial real estate mortgages	1,101		—		1,418		9,216		11,735		3,453,183		3,464,918
Residential mortgages:
Fixed	—		819		379		6,748		7,946		1,419,517		1,427,463
Variable	—		1,176		—		2,283		3,459		3,383,513		3,386,972
Total residential mortgages	—		1,995		379		9,031		11,405		4,803,030		4,814,435
Real estate construction:
Construction	—		—		—		—		—		432,934		432,934
Land	—		—		—		12,834		12,834		11,789		24,623
Total real estate construction	—		—		—		12,834		12,834		444,723		457,557
Home equity loans and lines of credit	388		—		—		6,090		6,478		710,338		716,816
Installment:
Commercial	1		—		4		—		5		310		315
Consumer	533		—		—		125		658		182,545		183,203
Total installment	534		—		4		125		663		182,855		183,518
Lease financing	—		—		—		172		172		607,260		607,432
Total	$	8,947	$	4,697	$	1,801	$	64,782	$	80,227	$	18,394,561	$	18,474,788

(in thousands) (1)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days and Accruing		Nonaccrual		Total Past Due and Nonaccrual Loans		Current		Total Loans and Leases
December 31, 2013
Commercial	$	6,582	$	362	$	—	$	14,248	$	21,192	$	7,541,108	$	7,562,300
Commercial real estate mortgages	1,197		1,633		—		18,449		21,279		3,201,722		3,223,001
Residential mortgages:
Fixed	—		—		379		3,789		4,168		1,436,283		1,440,451
Variable	—		—		—		7,872		7,872		3,105,988		3,113,860
Total residential mortgages	—		—		379		11,661		12,040		4,542,271		4,554,311
Real estate construction:
Construction	—		—		—		5,467		5,467		332,131		337,598
Land	—		797		—		13,600		14,397		15,009		29,406
Total real estate construction	—		797		—		19,067		19,864		347,140		367,004
Home equity loans and lines of credit	—		—		74		5,144		5,218		704,126		709,344
Installment:
Commercial	1		—		—		—		1		361		362
Consumer	10		7		—		32		49		151,544		151,593
Total installment	11		7		—		32		50		151,905		151,955
Lease financing	401		126		—		50		577		601,946		602,523
Total	$	8,191	$	2,925	$	453	$	68,651	$	80,220	$	17,090,218	$	17,170,438

(1) Commercial loans as of December 31, 2013 have been corrected to include $158.2 million of loans that were previously reported as lease financing.

Summary of the loan and lease portfolio, excluding covered loans, by loan type and credit quality classification

	June 30, 2014						December 31, 2013
(in thousands) (1)	Nonclassified		Classified		Total		Nonclassified		Classified		Total
Commercial	$	8,148,482	$	81,630	$	8,230,112	$	7,416,487	$	145,813	$	7,562,300
Commercial real estate mortgages	3,416,709		48,209		3,464,918		3,139,707		83,294		3,223,001
Residential mortgages:
Fixed	1,407,809		19,654		1,427,463		1,425,087		15,364		1,440,451
Variable	3,357,979		28,993		3,386,972		3,087,636		26,224		3,113,860
Total residential mortgages	4,765,788		48,647		4,814,435		4,512,723		41,588		4,554,311
Real estate construction:
Construction	432,934		—		432,934		332,131		5,467		337,598
Land	11,788		12,835		24,623		15,522		13,884		29,406
Total real estate construction	444,722		12,835		457,557		347,653		19,351		367,004
Home equity loans and lines of credit	687,909		28,907		716,816		687,732		21,612		709,344
Installment:
Commercial	315		—		315		362		—		362
Consumer	182,090		1,113		183,203		151,468		125		151,593
Total installment	182,405		1,113		183,518		151,830		125		151,955
Lease financing	602,693		4,739		607,432		598,821		3,702		602,523
Total	$	18,248,708	$	226,080	$	18,474,788	$	16,854,953	$	315,485	$	17,170,438

(1) Commercial loans as of December 31, 2013 have been corrected to include $158.2 million of loans that were previously reported as lease financing.

Summary of the allowance for loan losses on covered loans

	For the three months ended June 30,						For the six months ended June 30,
(in thousands)	2014			2013			2014			2013
Balance, beginning of period	$	18,439		$	42,354		$	15,922		$	44,781
(Reversal of) provision for losses	(1,461		)	(11,927		)	3,194			(2,035		)
Reduction in allowance due to loan removals	(7,875		)	(6,013		)	(10,013		)	(18,332		)
Balance, end of period	$	9,103		$	24,414		$	9,103		$	24,414