XML 44 R33.htm IDEA: XBRL DOCUMENT v3.10.0.1
Fair value measurements (Tables)
 6 Months Ended
Jun. 30, 2018
Fair Value Disclosures [Abstract]  
Assets and Liabilities Measured at Estimated Fair Value on Recurring Basis

The following tables present assets and liabilities at June 30, 2018 and December 31, 2017 measured at estimated fair value on a recurring basis:

 

 

 

Fair Value Measurements

 

 

Level 1 (a)

 

 

Level 2 (a)

 

 

Level 3

 

 

 

(In thousands)

 

June 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trading account assets

 

$

148,303

 

 

$

46,502

 

 

$

101,801

 

 

$

—

 

Investment securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury and federal agencies

 

 

1,707,821

 

 

 

—

 

 

 

1,707,821

 

 

 

—

 

Obligations of states and political subdivisions

 

 

1,925

 

 

 

—

 

 

 

1,925

 

 

 

—

 

Mortgage-backed securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government issued or guaranteed

 

 

7,817,299

 

 

 

—

 

 

 

7,817,299

 

 

 

—

 

Privately issued

 

 

24

 

 

 

—

 

 

 

—

 

 

 

24

 

Other debt securities

 

 

131,777

 

 

 

—

 

 

 

131,777

 

 

 

—

 

 

 

 

9,658,846

 

 

 

—

 

 

 

9,658,822

 

 

 

24

 

Equity securities

 

 

86,482

 

 

 

65,748

 

 

 

20,734

 

 

 

—

 

Real estate loans held for sale

 

 

1,151,090

 

 

 

—

 

 

 

1,151,090

 

 

 

—

 

Other assets (b)

 

 

19,987

 

 

 

—

 

 

 

8,186

 

 

 

11,801

 

Total assets

 

$

11,064,708

 

 

$

112,250

 

 

$

10,940,633

 

 

$

11,825

 

Trading account liabilities

 

$

281,538

 

 

$

—

 

 

$

281,538

 

 

$

—

 

Other liabilities (b)

 

 

8,483

 

 

 

—

 

 

 

7,433

 

 

 

1,050

 

Total liabilities

 

$

290,021

 

 

$

—

 

 

$

288,971

 

 

$

1,050

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trading account assets

 

$

132,909

 

 

$

47,873

 

 

$

85,036

 

 

$

—

 

Investment securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury and federal agencies

 

 

1,947,487

 

 

 

—

 

 

 

1,947,487

 

 

 

—

 

Obligations of states and political subdivisions

 

 

2,589

 

 

 

—

 

 

 

2,589

 

 

 

—

 

Mortgage-backed securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government issued or guaranteed

 

 

8,716,392

 

 

 

—

 

 

 

8,716,392

 

 

 

—

 

Privately issued

 

 

28

 

 

 

—

 

 

 

—

 

 

 

28

 

Other debt securities

 

 

128,832

 

 

 

—

 

 

 

128,832

 

 

 

—

 

Equity securities

 

 

100,956

 

 

 

73,232

 

 

 

27,724

 

 

 

—

 

 

 

 

10,896,284

 

 

 

73,232

 

 

 

10,823,024

 

 

 

28

 

Real estate loans held for sale

 

 

378,047

 

 

 

—

 

 

 

378,047

 

 

 

—

 

Other assets (b)

 

 

12,696

 

 

 

—

 

 

 

3,899

 

 

 

8,797

 

Total assets

 

$

11,419,936

 

 

$

121,105

 

 

$

11,290,006

 

 

$

8,825

 

Trading account liabilities

 

$

137,390

 

 

$

—

 

 

$

137,390

 

 

$

—

 

Other liabilities (b)

 

 

1,796

 

 

 

—

 

 

 

1,302

 

 

 

494

 

Total liabilities

 

$

139,186

 

 

$

—

 

 

$

138,692

 

 

$

494

 

 

(a)

There were no significant transfers between Level 1 and Level 2 of the fair value hierarchy during the six months ended June 30, 2018 and the year ended December 31, 2017.                                        

(b)

Comprised predominantly of interest rate swap agreements used for interest rate risk management (Level 2), commitments to sell real estate loans (Level 2) and commitments to originate real estate loans to be held for sale (Level 3).
Changes in Level 3 Assets and Liabilities Measured at Estimated Fair Value on Recurring Basis

The changes in Level 3 assets and liabilities measured at estimated fair value on a recurring basis during the three months ended June 30, 2018 were as follows:

 

 

 

Investment Securities

Available for Sale

 

 

 

 

 

 

 

 

Privately Issued

Mortgage-Backed

Securities

 

 

Other Assets

and Other

Liabilities

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Balance - March 31, 2018

 

$

27

 

 

 

8,760

 

 

Total gains (losses) realized/unrealized:

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

—

 

 

 

20,277

 

(b)

Settlements

 

 

(3

)

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

—

 

 

 

(18,286

)

(c)

Balance — June 30, 2018

 

$

24

 

 

 

10,751

 

 

Changes in unrealized gains included in earnings

   related to assets still held at June 30, 2018

 

$

—

 

 

 

10,686

 

(b)

 

The changes in Level 3 assets and liabilities measured at estimated fair value on a recurring basis during the three months ended June 30, 2017 were as follows:

 

 

 

Investment Securities

Available for Sale

 

 

 

 

 

 

 

 

Privately Issued

Mortgage-Backed

Securities

 

 

Other Assets

and Other

Liabilities

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Balance - March 31, 2017

 

$

41

 

 

 

16,202

 

 

Total gains (losses) realized/unrealized:

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

—

 

 

 

19,571

 

(b)

Settlements

 

 

(6

)

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

—

 

 

 

(23,348

)

(c)

Balance — June 30, 2017

 

$

35

 

 

 

12,425

 

 

Changes in unrealized gains included in earnings

   related to assets still held at June 30, 2017

 

$

—

 

 

 

10,892

 

(b)

 

11. Fair value measurements, continued

The changes in Level 3 assets and liabilities measured at estimated fair value on a recurring basis during the six months ended June 30, 2018 were as follows:

 

 

 

Investment securities

available for sale

 

 

 

 

 

 

 

 

Privately Issued

Mortgage-Backed

Securities

 

 

Other Assets

and Other

Liabilities

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Balance — January 1, 2018

 

$

28

 

 

 

8,303

 

 

Total gains (losses) realized/unrealized:

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

—

 

 

 

28,407

 

(b)

Settlements

 

 

(4

)

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

—

 

 

 

(25,959

)

(c)

Balance — June 30, 2018

 

$

24

 

 

 

10,751

 

 

Changes in unrealized gains included in earnings

   related to assets still held at June 30, 2018

 

$

—

 

 

 

10,686

 

(b)

 

The changes in Level 3 assets and liabilities measured at estimated fair value on a recurring basis during the six months ended June 30, 2017 were as follows:

 

 

 

Investment securities

available for sale

 

 

 

 

 

 

 

 

Privately Issued

Mortgage-Backed

Securities

 

 

Other Assets

and Other

Liabilities

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Balance — January 1, 2017

 

$

44

 

 

 

7,325

 

 

Total gains (losses) realized/unrealized:

 

 

 

 

 

 

 

 

 

Included in earnings

 

 

—

 

 

 

43,511

 

(b)

Settlements

 

 

(9

)

 

 

—

 

 

Transfers out of Level 3 (a)

 

 

—

 

 

 

(38,411

)

(c)

Balance — June 30, 2017

 

$

35

 

 

 

12,425

 

 

Changes in unrealized gains included in earnings

   related to assets still held at June 30, 2017

 

$

—

 

 

 

12,372

 

(b)

(a)

The Company’s policy for transfers between fair value levels is to recognize the transfer as of the actual date of the event or change in circumstances that caused the transfer.

(b)

Reported as mortgage banking revenues in the consolidated statement of income and includes the fair value of commitment issuances and expirations.

(c)

Transfers out of Level 3 consist of interest rate locks transferred to closed loans.
Quantitative Information Related to Significant Unobservable Inputs

The following tables present quantitative information about significant unobservable inputs used in the fair value measurements for certain Level 3 assets and liabilities at June 30, 2018 and December 31, 2017:

 

 

 

Fair Value

 

 

Valuation

Technique

 

Unobservable

Inputs/Assumptions

 

 

Range

(Weighted-

Average)

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

June 30, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring fair value measurements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Privately issued mortgage-backed

   securities

 

$

24

 

 

Two independent pricing quotes

 

 

—

 

 

 

—

 

Net other assets (liabilities) (a)

 

 

10,751

 

 

Discounted cash flow

 

Commitment expirations

 

 

0%-90% (20%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring fair value measurements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Privately issued mortgage-backed

   securities

 

$

28

 

 

Two independent pricing quotes

 

 

—

 

 

 

—

 

Net other assets (liabilities) (a)

 

 

8,303

 

 

Discounted cash flow

 

Commitment expirations

 

 

0%-78% (22%)

 

 

(a)

Other Level 3 assets (liabilities) consist of commitments to originate real estate loans.
Carrying Amounts and Estimated Fair Value for Financial Instrument Assets (Liabilities)

The carrying amounts and estimated fair value for financial instrument assets (liabilities) are presented in the following table:

 

 

 

June 30, 2018

 

 

 

Carrying

Amount

 

 

Estimated

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(In thousands)

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,369,094

 

 

 

1,369,094

 

 

 

1,258,614

 

 

 

110,480

 

 

 

—

 

Interest-bearing deposits at banks

 

 

6,669,985

 

 

 

6,669,985

 

 

 

—

 

 

 

6,669,985

 

 

 

—

 

Trading account assets

 

 

148,303

 

 

 

148,303

 

 

 

46,502

 

 

 

101,801

 

 

 

—

 

Investment securities

 

 

13,283,002

 

 

 

13,204,236

 

 

 

65,748

 

 

 

13,027,717

 

 

 

110,771

 

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans and leases

 

 

21,894,857

 

 

 

21,465,594

 

 

 

—

 

 

 

—

 

 

 

21,465,594

 

Commercial real estate loans

 

 

34,137,937

 

 

 

33,579,305

 

 

 

—

 

 

 

868,392

 

 

 

32,710,913

 

Residential real estate loans

 

 

18,310,712

 

 

 

18,110,823

 

 

 

—

 

 

 

4,128,794

 

 

 

13,982,029

 

Consumer loans

 

 

13,453,944

 

 

 

13,257,759

 

 

 

—

 

 

 

—

 

 

 

13,257,759

 

Allowance for credit losses

 

 

(1,019,248

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Loans and leases, net

 

 

86,778,202

 

 

 

86,413,481

 

 

 

—

 

 

 

4,997,186

 

 

 

81,416,295

 

Accrued interest receivable

 

 

333,549

 

 

 

333,549

 

 

 

—

 

 

 

333,549

 

 

 

—

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

$

(32,086,191

)

 

 

(32,086,191

)

 

 

—

 

 

 

(32,086,191

)

 

 

—

 

Savings and interest-checking deposits

 

 

(51,107,290

)

 

 

(51,107,290

)

 

 

—

 

 

 

(51,107,290

)

 

 

—

 

Time deposits

 

 

(5,817,680

)

 

 

(5,865,067

)

 

 

—

 

 

 

(5,865,067

)

 

 

—

 

Deposits at Cayman Islands office

 

 

(261,427

)

 

 

(261,427

)

 

 

—

 

 

 

(261,427

)

 

 

—

 

Short-term borrowings

 

 

(3,239,416

)

 

 

(3,239,416

)

 

 

—

 

 

 

(3,239,416

)

 

 

—

 

Long-term borrowings

 

 

(8,382,316

)

 

 

(8,392,684

)

 

 

—

 

 

 

(8,392,684

)

 

 

—

 

Accrued interest payable

 

 

(87,779

)

 

 

(87,779

)

 

 

—

 

 

 

(87,779

)

 

 

—

 

Trading account liabilities

 

 

(281,538

)

 

 

(281,538

)

 

 

—

 

 

 

(281,538

)

 

 

—

 

Other financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments to originate real estate loans for sale

 

$

10,751

 

 

 

10,751

 

 

 

—

 

 

 

—

 

 

 

10,751

 

Commitments to sell real estate loans

 

 

882

 

 

 

882

 

 

 

—

 

 

 

882

 

 

 

—

 

Other credit-related commitments

 

 

(127,898

)

 

 

(127,898

)

 

 

—

 

 

 

—

 

 

 

(127,898

)

Interest rate swap agreements used for interest

   rate risk management

 

 

(129

)

 

 

(129

)

 

 

—

 

 

 

(129

)

 

 

—

 

 

 

 

December 31, 2017

 

 

 

Carrying

Amount

 

 

Estimated

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

 

 

 

 

(In thousands)

 

 

 

 

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,420,888

 

 

 

1,420,888

 

 

 

1,352,035

 

 

 

68,853

 

 

—

 

Interest-bearing deposits at banks

 

 

5,078,903

 

 

 

5,078,903

 

 

 

—

 

 

 

5,078,903

 

 

—

 

Trading account assets

 

 

132,909

 

 

 

132,909

 

 

 

47,873

 

 

 

85,036

 

 

—

 

Investment securities

 

 

14,664,525

 

 

 

14,653,074

 

 

 

73,232

 

 

 

14,469,127

 

 

 

110,715

 

Loans and leases:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans and leases

 

 

21,742,651

 

 

 

21,321,282

 

 

—

 

 

—

 

 

 

21,321,282

 

Commercial real estate loans

 

 

33,366,373

 

 

 

32,950,724

 

 

—

 

 

 

22,130

 

 

 

32,928,594

 

Residential real estate loans

 

 

19,613,344

 

 

 

19,596,826

 

 

—

 

 

 

4,440,645

 

 

 

15,156,181

 

Consumer loans

 

 

13,266,615

 

 

 

13,161,517

 

 

—

 

 

 

—

 

 

 

13,161,517

 

Allowance for credit losses

 

 

(1,017,198

)

 

 

—

 

 

—

 

 

 

—

 

 

 

—

 

Loans and leases, net

 

 

86,971,785

 

 

 

87,030,349

 

 

—

 

 

 

4,462,775

 

 

 

82,567,574

 

Accrued interest receivable

 

 

327,170

 

 

 

327,170

 

 

—

 

 

 

327,170

 

 

 

—

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

$

(33,975,180

)

 

 

(33,975,180

)

 

—

 

 

 

(33,975,180

)

 

—

 

Savings and interest-checking deposits

 

 

(51,698,008

)

 

 

(51,698,008

)

 

—

 

 

 

(51,698,008

)

 

—

 

Time deposits

 

 

(6,580,962

)

 

 

(6,635,048

)

 

—

 

 

 

(6,635,048

)

 

—

 

Deposits at Cayman Islands office

 

 

(177,996

)

 

 

(177,996

)

 

—

 

 

 

(177,996

)

 

—

 

Short-term borrowings

 

 

(175,099

)

 

 

(175,099

)

 

—

 

 

 

(175,099

)

 

—

 

Long-term borrowings

 

 

(8,141,430

)

 

 

(8,193,783

)

 

—

 

 

 

(8,193,783

)

 

—

 

Accrued interest payable

 

 

(75,641

)

 

 

(75,641

)

 

—

 

 

 

(75,641

)

 

—

 

Trading account liabilities

 

 

(137,390

)

 

 

(137,390

)

 

—

 

 

 

(137,390

)

 

—

 

Other financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments to originate real estate loans for sale

 

$

8,303

 

 

 

8,303

 

 

—

 

 

 

—

 

 

 

8,303

 

Commitments to sell real estate loans

 

 

1,958

 

 

 

1,958

 

 

—

 

 

 

1,958

 

 

—

 

Other credit-related commitments

 

 

(125,281

)

 

 

(125,281

)

 

—

 

 

 

—

 

 

 

(125,281

)

Interest rate swap agreements used for interest

   rate risk management

 

 

639

 

 

 

639

 

 

—

 

 

 

639

 

 

—