Income taxes (Tables)

12 Months Ended

Dec. 31, 2019

The components of income tax expense were as follows:

	Year Ended December 31
	2019		2018			2017
	(In thousands)
Current
Federal	$	359,668	$	408,428		$	363,043
State and local		132,696		113,706			94,714
Total current		492,364		522,134			457,757
Deferred
Federal		40,769		(12,780	)		367,308
State and local		16,779		28,637			33,482
Total deferred		57,548		15,857			400,790
Amortization of investments in qualified affordable housing projects		68,200		52,169			57,009
Total income taxes applicable to pre-tax income	$	618,112	$	590,160		$	915,556

Total income taxes differed from the amount computed by applying the statutory federal income tax rate to pre-tax income as follows:

	Year Ended December 31
	2019			2018			2017
	(In thousands)

Income taxes at statutory federal income tax rate	$	534,925		$	526,730		$	813,352
Increase (decrease) in taxes:
Tax-exempt income		(27,319	)		(26,186	)		(40,778	)
State and local income taxes, net of federal income tax effect		118,085			112,451			83,327
Qualified affordable housing project federal tax credits, net		(15,324	)		(12,240	)		(16,015	)
Initial impact of enactment of Tax Act		—			—			85,431
Other		7,745			(10,595	)		(9,761	)
	$	618,112		$	590,160		$	915,556

Deferred tax assets (liabilities) were comprised of the following at December 31:

	2019			2018			2017
	(In thousands)

Losses on loans and other assets	$	309,523		$	322,818		$	345,609
Operating lease liabilities		128,178			—			—
Retirement benefits		55,048			30,057			45,322
Postretirement and other employee benefits		24,023			23,563			26,009
Incentive and other compensation plans		26,861			24,796			25,050
Interest on loans		—			—			37,900
Stock-based compensation		27,912			26,759			26,676
Unrealized losses		—			52,580			—
Losses on cash flow hedges		—			1,861			4,033
Other		69,863			43,880			66,247
Gross deferred tax assets		641,408			526,314			576,846
Right of use assets and other leasing transactions		(326,626	)		(186,787	)		(181,159	)
Unrealized gains		(13,322	)		—			(94,285	)
Capitalized servicing rights		(56,649	)		(54,894	)		(51,781	)
Depreciation and amortization		(66,925	)		(61,881	)		(52,733	)
Interest on loans		(23,552	)		(18,920	)		—
Gains on cash flow hedges		(36,845	)		—			—
Other		(40,472	)		(30,211	)		(25,632	)
Gross deferred tax liabilities		(564,391	)		(352,693	)		(405,590	)
Net deferred tax asset	$	77,017		$	173,621		$	171,256

A reconciliation of the beginning and ending amount of unrecognized tax benefits follows:

	Federal, State and Local Tax			Accrued Interest			Unrecognized Income Tax Benefits
	(In thousands)

Gross unrecognized tax benefits at January 1, 2017	$	35,889		$	7,915		$	43,804
Increases as a result of tax positions taken during 2017		13,019			—			13,019
Increases as a result of tax positions taken in prior years		—			1,379			1,379
Decreases as a result of settlements with taxing authorities		(332	)		(168	)		(500	)
Decreases as a result of tax positions taken in prior years		(3,144	)		(3,475	)		(6,619	)
Gross unrecognized tax benefits at December 31, 2017		45,432			5,651			51,083
Increases as a result of tax positions taken during 2018		13,426			—			13,426
Increases as a result of tax positions taken in prior years		—			1,969			1,969
Decreases as a result of settlements with taxing authorities		(664	)		(289	)		(953	)
Decreases as a result of tax positions taken in prior years		(1,920	)		(702	)		(2,622	)
Gross unrecognized tax benefits at December 31, 2018		56,274			6,629			62,903
Increases as a result of tax positions taken during 2019		6,996			—			6,996
Increases as a result of tax positions taken in prior years		3,265			3,255			6,520
Decreases as a result of tax positions taken in prior years		(7,566	)		(2,685	)		(10,251	)
Gross unrecognized tax benefits at December 31, 2019	$	58,969		$	7,199			66,168
Less: Federal, state and local income tax benefits								(13,208	)
Net unrecognized tax benefits at December 31, 2019 that, if recognized, would impact the effective income tax rate							$	52,960