Loans and leases and the allowance for credit losses

6 Months Ended

Jun. 30, 2022

Loans and leases and the allowance for credit losses

4. Loans and leases and the allowance for credit losses

A summary of current, past due and nonaccrual loans as of June 30, 2022 and December 31, 2021 follows:


	Current		30-89 Days Past Due		Accruing Loans Past Due 90 Days or More		Nonaccrual		Total
	(In thousands)
June 30, 2022
Commercial, financial, leasing, etc.	$	38,521,001		133,014		12,165		442,496	$	39,108,676
Real estate:
Commercial		35,601,423		243,578		34,815		1,476,658		37,356,474
Residential builder and developer		1,368,677		1,219		—		518		1,370,414
Other commercial construction		7,877,882		117,323		—		73,046		8,068,251
Residential		20,476,197		345,622		473,541		331,376		21,626,736
Residential — limited documentation		1,014,151		13,612		—		112,608		1,140,371
Consumer:
Home equity lines and loans		4,959,003		21,243		—		79,445		5,059,691
Recreational finance		8,403,078		32,654		—		33,414		8,469,146
Automobile		4,369,475		32,220		—		36,266		4,437,961
Other		1,786,347		11,734		3,141		47,178		1,848,400
Total	$	124,377,234		952,219		523,662		2,633,005	$	128,486,120


December 31, 2021
Commercial, financial, leasing, etc.	$	23,101,810	142,208	8,284	221,022	$	23,473,324
Real estate:
Commercial		24,712,643	319,099	31,733	1,069,280		26,132,755
Residential builder and developer		1,400,437	2,904	—	3,005		1,406,346
Other commercial construction		7,722,049	17,175	—	111,405		7,850,629
Residential		13,294,872	239,561	920,080	355,858		14,810,371
Residential — limited documentation		1,124,520	16,666	—	122,888		1,264,074
Consumer:
Home equity lines and loans		3,476,617	15,486	—	70,488		3,562,591
Recreational finance		7,985,173	40,544	—	27,811		8,053,528
Automobile		4,604,772	40,064	—	34,037		4,678,873
Other		1,620,147	12,223	3,302	44,289		1,679,961
Total	$	89,043,040	845,930	963,399	2,060,083	$	92,912,452

At June 30, 2022 and December 31, 2021, the Company had $109 million and $1.2 billion, respectively, of outstanding loan balances, consisting predominantly of residential real estate loans, for which COVID-19 related payment deferrals were granted. Those loans met the criteria described in note 1 of Notes to Financial Statements in the 2021 Annual Report and, accordingly, are not considered past due or otherwise in default of loan terms as of the date presented. Included in those loan balances were $55 million and $974 million of government-guaranteed loans at June 30, 2022 and December 31, 2021, respectively. Payment deferrals are generally scheduled to expire in 2022 and/or are in the process of formal modification of repayment terms for previously deferred payments.

One-to-four family residential mortgage loans held for sale were $65 million and $474 million at June 30, 2022 and December 31, 2021, respectively. Commercial real estate loans held for sale were $255 million at June 30, 2022 and $425 million at December 31, 2021.

4. Loans and leases and the allowance for credit losses, continued

Credit quality indicators

The Company utilizes a loan grading system to differentiate risk amongst its commercial loans and commercial real estate loans. Loans with a lower expectation of default are assigned one of ten possible “pass” loan grades and are generally ascribed lower loss factors when determining the allowance for credit losses. Loans with an elevated level of credit risk are classified as “criticized” and are ascribed a higher loss factor when determining the allowance for credit losses. Criticized loans may be classified as “nonaccrual” if the Company no longer expects to collect all amounts according to the contractual terms of the loan agreement or the loan is delinquent 90 days or more.

Line of business personnel in different geographic locations with support from and review by the Company’s credit risk personnel review and reassign loan grades based on their detailed knowledge of individual borrowers and their judgment of the impact on such borrowers resulting from changing conditions in their respective regions. Factors considered in assigning loan grades include borrower-specific information related to expected future cash flows and operating results, collateral values, geographic location, financial condition and performance, payment status, and other information. The Company’s policy is that at least annually, updated financial information be obtained from commercial borrowers associated with pass grade loans and additional analysis performed. On a quarterly basis, the Company’s centralized credit risk department reviews all criticized commercial loans and commercial real estate loans greater than $1 million to determine the appropriateness of the assigned loan grade, including whether the loan should be reported as accruing or nonaccruing.

The following table summarizes the loan grades applied at June 30, 2022 to the various classes of the Company’s commercial loans and commercial real estate loans by origination year.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
	2022		2021		2020		2019		2018		Prior		Loans		Loans		Total
	(In thousands)
Commercial, financial, leasing, etc.:
Loan grades:
Pass	$	4,040,770		5,910,000		2,707,274		2,245,712		1,185,986		2,423,902		18,131,082		96,966	$	36,741,692
Criticized accrual		104,872		308,238		174,456		161,455		89,976		301,823		763,106		20,562		1,924,488
Criticized nonaccrual		8,108		32,438		43,509		48,561		43,645		67,201		181,671		17,363		442,496
Total commercial, financial, leasing, etc.	$	4,153,750		6,250,676		2,925,239		2,455,728		1,319,607		2,792,926		19,075,859		134,891	$	39,108,676

Real estate:
Commercial:
Loan grades:
Pass	$	1,968,740		3,517,917		3,331,058		4,713,994		3,623,085		12,157,321		909,783		42,152	$	30,264,050
Criticized accrual		9,416		292,974		610,198		1,016,273		1,185,485		2,474,002		26,295		1,123		5,615,766
Criticized nonaccrual		—		12,474		170,587		255,973		187,443		819,543		30,297		341		1,476,658
Total commercial real estate	$	1,978,156		3,823,365		4,111,843		5,986,240		4,996,013		15,450,866		966,375		43,616	$	37,356,474

Residential builder and developer:
Loan grades:
Pass	$	359,601		533,300		49,295		44,867		45,839		13,118		184,013		—	$	1,230,033
Criticized accrual		—		651		7,302		109,851		14,351		7,038		670		—		139,863
Criticized nonaccrual		—		—		—		518		—		—		—		—		518
Total residential builder and developer	$	359,601		533,951		56,597		155,236		60,190		20,156		184,683		—	$	1,370,414

Other commercial construction:
Loan grades:
Pass	$	296,748		1,362,467		1,727,216		1,749,121		447,298		421,217		41,528		9,890	$	6,055,485
Criticized accrual		1,987		76,778		197,643		868,248		529,883		257,535		7,646		—		1,939,720
Criticized nonaccrual		—		2,068		96		17,896		12,827		35,700		4,459		—		73,046
Total other commercial construction	$	298,735		1,441,313		1,924,955		2,635,265		990,008		714,452		53,633		9,890	$	8,068,251

4. Loans and leases and the allowance for credit losses, continued

The Company considers repayment performance a significant indicator of credit quality for its residential real estate loan and consumer loan portfolios. A summary of loans in accrual and nonaccrual status at June 30, 2022 for the various classes of the Company’s residential real estate loans and consumer loans by origination year follows.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
	2022		2021		2020		2019		2018		Prior		Loans		Loans		Total
	(In thousands)
Residential:
Current	$	2,774,781		4,133,015		2,824,197		1,469,655		819,846		8,410,042		44,082		579	$	20,476,197
30-89 days past due		19,586		31,097		19,219		11,035		13,304		251,381		—		—		345,622
Accruing loans past due 90 days or more		1,573		35,314		35,571		12,747		18,253		368,243		1,840		—		473,541
Nonaccrual		267		5,913		7,586		13,513		5,442		297,888		767		—		331,376
Total residential	$	2,796,207		4,205,339		2,886,573		1,506,950		856,845		9,327,554		46,689		579	$	21,626,736

Residential - limited documentation:
Current	$	—		—		—		—		—		1,014,151		—		—	$	1,014,151
30-89 days past due		—		—		—		—		—		13,612		—		—		13,612
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		112,608		—		—		112,608
Total residential - limited documentation	$	—		—		—		—		—		1,140,371		—		—	$	1,140,371

Consumer:
Home equity lines and loans:
Current	$	12,764		3,567		4,086		21,813		40,687		175,799		3,319,575		1,380,712	$	4,959,003
30-89 days past due		—		—		—		488		76		1,779		708		18,192		21,243
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		15		58		—		357		6,531		4,681		67,803		79,445
Total home equity lines and loans	$	12,764		3,582		4,144		22,301		41,120		184,109		3,324,964		1,466,707	$	5,059,691

Recreational finance:
Current	$	1,486,689		2,545,464		1,790,423		1,090,205		555,622		934,675		—		—	$	8,403,078
30-89 days past due		1,792		6,019		6,605		6,373		4,398		7,467		—		—		32,654
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		101		3,646		7,195		6,395		5,177		10,900		—		—		33,414
Total recreational finance	$	1,488,582		2,555,129		1,804,223		1,102,973		565,197		953,042		—		—	$	8,469,146

Automobile:
Current	$	712,715		1,867,711		873,582		501,358		244,089		170,020		—		—	$	4,369,475
30-89 days past due		1,686		7,833		5,534		6,587		4,816		5,764		—		—		32,220
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		193		5,425		6,912		8,213		6,879		8,644		—		—		36,266
Total automobile	$	714,594		1,880,969		886,028		516,158		255,784		184,428		—		—	$	4,437,961

Other:
Current	$	130,873		204,244		75,125		53,379		15,123		61,664		1,244,637		1,302	$	1,786,347
30-89 days past due		1,537		1,326		409		268		137		1,027		6,539		491		11,734
Accruing loans past due 90 days or more		—		—		—		—		—		147		2,994		—		3,141
Nonaccrual		1,368		522		310		278		112		278		44,200		110		47,178
Total other	$	133,778		206,092		75,844		53,925		15,372		63,116		1,298,370		1,903	$	1,848,400

Total loans and leases at June 30, 2022	$	11,936,167		20,900,416		14,675,446		14,434,776		9,100,136		30,831,020		24,950,573		1,657,586	$	128,486,120

4. Loans and leases and the allowance for credit losses, continued

The following table summarizes the loan grades applied at December 31, 2021 to the various classes of the Company’s commercial loans and commercial real estate loans by origination year.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
	2021		2020		2019		2018		2017		Prior		Loans		Loans		Total
	(In thousands)
Commercial, financial, leasing, etc.:
Loan grades:
Pass	$	4,798,052		1,916,072		1,476,786		951,881		500,615		1,398,775		10,993,461		18,699	$	22,054,341
Criticized accrual		196,680		98,595		107,010		73,126		36,232		185,935		484,755		15,628		1,197,961
Criticized nonaccrual		19,462		23,229		17,114		39,908		20,927		33,698		60,175		6,509		221,022
Total commercial, financial, leasing, etc.	$	5,014,194		2,037,896		1,600,910		1,064,915		557,774		1,618,408		11,538,391		40,836	$	23,473,324

Real estate:
Commercial:
Loan grades:
Pass	$	3,413,587		2,662,999		3,682,178		2,648,388		2,076,155		5,232,790		728,948		—	$	20,445,045
Criticized accrual		133,133		480,146		685,701		1,068,552		468,530		1,743,798		38,570		—		4,618,430
Criticized nonaccrual		21,587		133,560		195,084		83,857		76,628		520,473		38,091		—		1,069,280
Total commercial real estate	$	3,568,307		3,276,705		4,562,963		3,800,797		2,621,313		7,497,061		805,609		—	$	26,132,755

Residential builder and developer:
Loan grades:
Pass	$	786,983		106,510		75,287		47,587		4,680		12,450		230,017		—	$	1,263,514
Criticized accrual		2,055		5,356		117,258		13,637		630		—		891		—		139,827
Criticized nonaccrual		—		—		2,910		—		—		95		—		—		3,005
Total residential builder and developer	$	789,038		111,866		195,455		61,224		5,310		12,545		230,908		—	$	1,406,346

Other commercial construction:
Loan grades:
Pass	$	957,947		1,781,603		2,022,276		832,547		152,669		273,556		38,781		—	$	6,059,379
Criticized accrual		24,103		54,191		675,226		583,428		228,739		114,158		—		—		1,679,845
Criticized nonaccrual		—		—		71,613		3,303		12,263		19,970		4,256		—		111,405
Total other commercial construction	$	982,050		1,835,794		2,769,115		1,419,278		393,671		407,684		43,037		—	$	7,850,629

4. Loans and leases and the allowance for credit losses, continued

A summary of loans in accrual and nonaccrual status at December 31, 2021 for the various classes of the Company’s residential real estate loans and consumer loans by origination year follows.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
	2021		2020		2019		2018		2017		Prior		Loans		Loans		Total
	(In thousands)
Residential:
Current	$	3,057,118		1,672,090		1,075,896		466,040		1,037,958		5,913,461		72,309		—	$	13,294,872
30-89 days past due		15,245		12,535		9,886		6,132		33,097		162,666		—		—		239,561
Accruing loans past due 90 days or more		10,924		100,581		28,512		31,996		205,318		542,749		—		—		920,080
Nonaccrual		3,359		19,858		7,119		4,577		5,890		314,792		263		—		355,858
Total residential	$	3,086,646		1,805,064		1,121,413		508,745		1,282,263		6,933,668		72,572		—	$	14,810,371

Residential - limited documentation:
Current	$	—		—		—		—		—		1,124,520		—		—	$	1,124,520
30-89 days past due		—		—		—		—		—		16,666		—		—		16,666
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		122,888		—		—		122,888
Total residential - limited documentation	$	—		—		—		—		—		1,264,074		—		—	$	1,264,074

Consumer:
Home equity lines and loans:
Current	$	304		777		2,793		1,730		1,944		38,015		2,348,279		1,082,775	$	3,476,617
30-89 days past due		—		—		—		21		—		698		346		14,421		15,486
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		5,750		4,951		59,787		70,488
Total home equity lines and loans	$	304		777		2,793		1,751		1,944		44,463		2,353,576		1,156,983	$	3,562,591

Recreational finance:
Current	$	2,890,111		2,088,342		1,267,929		646,883		445,868		646,040		—		—	$	7,985,173
30-89 days past due		5,929		8,912		8,317		5,074		5,189		7,123		—		—		40,544
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		1,341		4,646		4,871		4,918		4,039		7,996		—		—		27,811
Total recreational finance	$	2,897,381		2,101,900		1,281,117		656,875		455,096		661,159		—		—	$	8,053,528

Automobile:
Current	$	2,220,061		1,097,684		662,000		341,655		211,774		71,598		—		—	$	4,604,772
30-89 days past due		8,508		6,615		8,936		7,161		5,715		3,129		—		—		40,064
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		1,588		4,390		7,847		7,867		6,882		5,463		—		—		34,037
Total automobile	$	2,230,157		1,108,689		678,783		356,683		224,371		80,190		—		—	$	4,678,873

Other:
Current	$	244,346		96,945		73,586		24,424		16,924		14,321		1,148,096		1,505	$	1,620,147
30-89 days past due		2,937		404		472		255		101		5,712		1,908		434		12,223
Accruing loans past due 90 days or more		—		—		—		—		—		3,302		—		—		3,302
Nonaccrual		2,051		326		326		193		104		353		40,807		129		44,289
Total other	$	249,334		97,675		74,384		24,872		17,129		23,688		1,190,811		2,068	$	1,679,961

Total loans and leases at December 31, 2021	$	18,817,411		12,376,366		12,286,933		7,895,140		5,558,871		18,542,940		16,234,904		1,199,887	$	92,912,452

4. Loans and leases and the allowance for credit losses, continued

Allowance for credit losses

For purposes of determining the level of the allowance for credit losses, the Company evaluates its loan and lease portfolio by type. Changes in the allowance for credit losses for the three months ended June 30, 2022 and 2021 were as follows:


	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Total
	(In thousands)
Three Months Ended June 30, 2022
Beginning balance	$	307,055			539,444			72,581			553,279		$	1,472,359
Allowance on acquired PCD loans		41,003			55,812			1,833			352			99,000
Provision for credit losses (a)		95,917			120,277			50,168			35,638			302,000
Net charge-offs
Charge-offs (b)		(37,925	)		(8,796	)		(2,863	)		(26,030	)		(75,614	)
Recoveries		8,423			1,656			2,607			13,359			26,045
Net charge-offs		(29,502	)		(7,140	)		(256	)		(12,671	)		(49,569	)
Ending balance	$	414,473			708,393			124,326			576,598		$	1,823,790


	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Total
	(In thousands)
Three Months Ended June 30, 2021
Beginning balance	$	328,994			716,098			89,789			501,325		$	1,636,206
Provision for credit losses		15,100			(24,805	)		(12,069	)		6,774			(15,000	)
Net charge-offs
Charge-offs		(40,095	)		(12,523	)		(2,262	)		(25,489	)		(80,369	)
Recoveries		10,853			1,193			2,411			19,834			34,291
Net (charge-offs) recoveries		(29,242	)		(11,330	)		149			(5,655	)		(46,078	)
Ending balance	$	314,852			679,963			77,869			502,444		$	1,575,128

(a)

Includes $242 million related to non-PCD acquired loans for the three months ended June 30, 2022.

(b)

For the three months ended June 30, 2022, net charge-offs do not reflect $33 million of charge-offs related to PCD acquired loans.

Changes in the allowance for credit losses for the six months ended June 30, 2022 and 2021 were as follows:


	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Total
	(In thousands)
Six Months Ended June 30, 2022
Beginning balance	$	283,899			557,239			71,726			556,362		$	1,469,226
Allowance on acquired PCD loans		41,003			55,812			1,833			352			99,000
Provision for credit losses (a)		124,642			89,339			51,888			46,131			312,000
Net charge-offs
Charge-offs (b)		(57,159	)		(10,596	)		(6,835	)		(52,062	)		(126,652	)
Recoveries		22,088			16,599			5,714			25,815			70,216
Net (charge-offs) recoveries		(35,071	)		6,003			(1,121	)		(26,247	)		(56,436	)
Ending balance	$	414,473			708,393			124,326			576,598		$	1,823,790

4. Loans and leases and the allowance for credit losses, continued


	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Total
	(In thousands)
Six Months Ended June 30, 2021
Beginning balance	$	405,846			670,719			103,590			556,232		$	1,736,387
Provision for credit losses		(57,318	)		74,666			(25,504	)		(31,844	)		(40,000	)
Net charge-offs
Charge-offs		(67,040	)		(73,175	)		(4,661	)		(58,418	)		(203,294	)
Recoveries		33,364			7,753			4,444			36,474			82,035
Net charge-offs		(33,676	)		(65,422	)		(217	)		(21,944	)		(121,259	)
Ending balance	$	314,852			679,963			77,869			502,444		$	1,575,128

(a)

Includes $242 million related to non-PCD acquired loans for the six months ended June 30, 2022.

(b)

For the six months ended June 30, 2022, net charge-offs do not reflect $33 million of charge-offs related to PCD acquired loans.

Despite the allocation in the preceding tables, the allowance for credit losses is general in nature and is available to absorb losses from any loan or lease type. In determining the allowance for credit losses, accruing loans with similar risk characteristics are generally evaluated collectively. The Company utilizes statistically developed models to project principal balances over the remaining contractual lives of the loan portfolios and to determine estimated credit losses through a reasonable and supportable forecast period. Individual loan credit quality indicators including loan grade and borrower repayment performance, can inform the models, which have been statistically developed based on historical correlations of credit losses with prevailing economic metrics, including unemployment, gross domestic product and real estate prices. Model forecasts may be adjusted for inherent limitations or biases that have been identified through independent validation and back-testing of model performance to actual realized results. At each of June 30, 2022 and December 31, 2021, the Company utilized a reasonable and supportable forecast period of two years. Subsequent to this forecast period the Company reverted, ratably over a one-year period, to historical loss experience to inform its estimate of losses for the remaining contractual life of each portfolio. The Company also estimates losses attributable to specific troubled credits identified through both normal and targeted credit review processes. The amounts of specific loss components in the Company’s loan and lease portfolios are determined through a loan-by-loan analysis of larger balance commercial loans and commercial real estate loans that are in nonaccrual status. Such loss estimates are typically based on expected future cash flows, collateral values and other factors that may impact the borrower’s ability to pay. To the extent that those loans are collateral-dependent, they are evaluated based on the fair value of the loan’s collateral as estimated at or near the financial statement date. As the quality of a loan deteriorates to the point of classifying the loan as “criticized,” the process of obtaining updated collateral valuation information is usually initiated, unless it is not considered warranted given factors such as the relative size of the loan, the characteristics of the collateral or the age of the last valuation. In those cases where current appraisals may not yet be available, prior appraisals are utilized with adjustments, as deemed necessary, for estimates of subsequent declines in values as determined by line of business and/or loan workout personnel. Those adjustments are reviewed and assessed for reasonableness by the Company’s credit risk personnel. Accordingly, for real estate collateral securing larger nonaccrual commercial loans and commercial real estate loans, estimated collateral values are based on current appraisals and estimates of value. For non-real estate loans, collateral is assigned a discounted estimated liquidation value and, depending on the nature of the collateral, is verified through field exams or other procedures. In assessing collateral, real estate and non-real estate values are reduced by an estimate of selling costs.

4. Loans and leases and the allowance for credit losses, continued

For residential real estate loans, including home equity loans and lines of credit, the excess of the loan balance over the net realizable value of the property collateralizing the loan is charged-off when the loan becomes 150 days delinquent. That charge-off is based on recent indications of value from external parties that are generally obtained shortly after a loan becomes nonaccrual. Loans to consumers that file for bankruptcy are generally charged-off to estimated net collateral value shortly after the Company is notified of such filings. When evaluating individual home equity loans and lines of credit for charge off and for purposes of estimating losses in determining the allowance for credit losses, the Company gives consideration to the required repayment of any first lien positions related to collateral property. Modified loans, including smaller balance homogenous loans, that are considered to be troubled debt restructurings are evaluated for impairment giving consideration to the impact of the modified loan terms on the present value of the loan’s expected cash flows.

Changes in the amount of the allowance for credit losses reflect the outcome of the procedures described herein, including the impact of changes in macroeconomic forecasts as compared with previous forecasts, as well as the impact of portfolio concentrations, imprecision in economic forecasts, geopolitical conditions and other risk factors that might influence the loss estimation process.

The Company’s reserve for off-balance sheet credit exposures was not material at June 30, 2022 and December 31, 2021.

Information with respect to loans and leases that were considered nonaccrual at the beginning and end of the reporting period and the interest income recognized on such loans for the three-month and six-month periods ended June 30, 2022 and 2021 follows.


	June 30, 2022						March 31, 2022		January 1, 2022		Three Months Ended June 30, 2022		Six Months Ended June 30, 2022
	Amortized Cost with Allowance		Amortized Cost without Allowance		Total		Amortized Cost		Amortized Cost		Interest Income Recognized		Interest Income Recognized
	(In thousands)

Commercial, financial, leasing, etc.	$	278,396	$	164,100	$	442,496	$	275,146	$	221,022	$	2,121	$	15,715
Real estate:
Commercial		397,536		1,079,122		1,476,658		1,157,686		1,069,280		1,754		7,885
Residential builder and developer		518		—		518		2,916		3,005		259		1,687
Other commercial construction		36,345		36,701		73,046		50,855		111,405		2,750		3,376
Residential		175,019		156,357		331,376		341,671		355,858		6,797		13,338
Residential — limited documentation		70,718		41,890		112,608		123,512		122,888		31		227
Consumer:
Home equity lines and loans		30,328		49,117		79,445		71,489		70,488		1,813		2,622
Recreational finance		26,530		6,884		33,414		31,546		27,811		161		322
Automobile		31,970		4,296		36,266		35,350		34,037		37		75
Other		47,040		138		47,178		44,060		44,289		92		184
Total	$	1,094,400	$	1,538,605	$	2,633,005	$	2,134,231	$	2,060,083	$	15,815	$	45,431

4. Loans and leases and the allowance for credit losses, continued


	June 30, 2021						March 31, 2021		January 1, 2021		Three Months Ended June 30, 2021		Six Months Ended June 30, 2021
	Amortized Cost with Allowance		Amortized Cost without Allowance		Total		Amortized Cost		Amortized Cost		Interest Income Recognized		Interest Income Recognized
	(In thousands)

Commercial, financial, leasing, etc.	$	210,294	$	119,746	$	330,040	$	295,069	$	306,827	$	2,930	$	6,015
Real estate:
Commercial		366,166		715,380		1,081,546		824,079		775,894		604		2,262
Residential builder and developer		1,093		13,459		14,552		1,224		1,094		—		33
Other commercial construction		20,717		113,041		133,758		126,225		114,039		274		315
Residential		191,965		180,179		372,144		385,508		365,729		6,296		10,794
Residential — limited documentation		85,683		51,000		136,683		143,069		147,170		157		236
Consumer:
Home equity lines and loans		38,860		37,851		76,711		79,188		79,392		993		1,945
Recreational finance		16,620		6,656		23,276		27,218		25,519		159		314
Automobile		27,609		3,481		31,090		38,219		39,404		48		97
Other		42,096		161		42,257		37,307		38,231		143		323
Total	$	1,001,103	$	1,240,954	$	2,242,057	$	1,957,106	$	1,893,299	$	11,604	$	22,334

4. Loans and leases and the allowance for credit losses, continued

Loan modifications

During the normal course of business, the Company modifies loans to maximize recovery efforts. If the borrower is experiencing financial difficulty and a concession is granted, the Company considers such modifications as troubled debt restructurings and classifies those loans as either nonaccrual loans or renegotiated loans. The types of concessions that the Company grants typically include principal deferrals and interest rate concessions, but may also include other types of concessions.

The tables that follow summarize the Company’s loan modification activities that were considered troubled debt restructurings for the three-month and six-month periods ended June 30, 2022 and 2021:


					Post-modification (a)
	Number		Pre- modification Recorded Investment		Principal Deferral		Interest Rate Reduction		Other		Combination of Concession Types		Total
Three Months Ended June 30, 2022	(Dollars in thousands)

Commercial, financial, leasing, etc.		40	$	36,983	$	31,514	$	9	$	700	$	5,963	$	38,186
Real estate:
Commercial		13		2,816		1,454		—		—		1,330		2,784
Residential		67		18,481		14,284		—		—		5,038		19,322
Residential — limited documentation		—		—		—		—		—		—		—
Consumer:
Home equity lines and loans		33		2,633		2,597		—		—		93		2,690
Recreational finance		170		6,204		6,204		—		—		—		6,204
Automobile		529		9,771		9,771		—		—		—		9,771
Other		65		465		465		—		—		—		465
Total		917	$	77,353	$	66,289	$	9	$	700	$	12,424	$	79,422


Three Months Ended June 30, 2021

Commercial, financial, leasing, etc.		89	$	70,749	$	11,439	$	—	$	222	$	58,787	$	70,448
Real estate:
Commercial		35		143,141		7,370		—		28,356		106,435		142,161
Other commercial construction		3		542		532		—		—		—		532
Residential		117		34,041		29,573		—		—		4,290		33,863
Residential — limited documentation		3		405		405		—		—		—		405
Consumer:
Home equity lines and loans		16		1,970		1,970		—		—		—		1,970
Recreational finance		34		1,119		1,119		—		—		—		1,119
Automobile		94		1,502		1,502		—		—		—		1,502
Other		101		836		836		—		—		—		836
Total		492	$	254,305	$	54,746	$	—	$	28,578	$	169,512	$	252,836

(a)

Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages. The present value of interest rate concessions, discounted at the effective rate of the original loan, was not material.

4. Loans and leases and the allowance for credit losses, continued


					Post-modification (a)
	Number		Pre- modification Recorded Investment		Principal Deferral		Interest Rate Reduction		Other		Combination of Concession Types		Total
Six Months Ended June 30, 2022	(Dollars in thousands)

Commercial, financial, leasing, etc.		77	$	46,986	$	38,434	$	9	$	754	$	8,743	$	47,940
Real estate:
Commercial		30		10,398		5,830		—		2,101		2,185		10,116
Residential		164		42,532		29,727		—		—		14,999		44,726
Residential — limited documentation		5		1,076		894		—		—		193		1,087
Consumer:
Home equity lines and loans		68		4,783		4,585		—		—		265		4,850
Recreational finance		347		12,201		12,194		—		—		—		12,194
Automobile		1,063		20,034		20,004		—		—		—		20,004
Other		98		799		799		—		—		—		799
Total		1,852	$	138,809	$	112,467	$	9	$	2,855	$	26,385	$	141,716

Six Months Ended June 30, 2021

Commercial, financial, leasing, etc.		182	$	124,482	$	36,092	$	—	$	222	$	87,291	$	123,605
Real estate:
Commercial		68		170,011		18,530		—		30,570		118,857		167,957
Other commercial construction		3		542		532		—		—		—		532
Residential		240		73,624		68,130		—		—		5,407		73,537
Residential — limited documentation		13		1,521		1,464		—		—		—		1,464
Consumer:
Home equity lines and loans		42		3,685		3,456		—		—		174		3,630
Recreational finance		106		3,331		3,331		—		—		—		3,331
Automobile		370		6,471		6,457		—		—		14		6,471
Other		323		2,270		2,270		—		—		—		2,270
Total		1,347	$	385,937	$	140,262	$	—	$	30,792	$	211,743	$	382,797

(a)

Troubled debt restructurings are evaluated for impairment giving consideration to the impact of the modified loan terms on the present value of the loan’s expected cash flows. Impairment of troubled debt restructurings that have subsequently defaulted may also be measured based on the loan’s observable market price or the fair value of collateral if the loan is collateral-dependent. Charge-offs may also be recognized on troubled debt restructurings that have subsequently defaulted. Loans that were modified as troubled debt restructurings during the twelve months ended June 30, 2022 and 2021 and for which there was a subsequent payment default during the six-month periods ended June 30, 2022 and 2021, respectively, were not material.

The amount of foreclosed residential real estate property held by the Company was $27 million and $24 million at June 30, 2022 and December 31, 2021, respectively. There were $207 million and $151 million at June 30, 2022 and December 31, 2021, respectively, of loans secured by residential real estate that were in the process of foreclosure. Of all loans in the process of foreclosure at June 30, 2022, approximately 46% were government guaranteed.