Shareholders' Equity

12 Months Ended

Dec. 31, 2011

Shareholders' Equity

Shareholders' Equity

Note 11.    Shareholders' Equity

Regulatory Capital

The table below sets forth the minimum required capital amounts and ratios for well capitalized institutions and the actual capital amounts and ratios for the Company and the Bank as of December 31, 2011 and 2010:

(dollars in thousands)	Well Capitalized Minimum Ratio			Company			Bank
As of December 31, 2011:
Shareholders' Equity				$	1,002,667		$	926,673
Tier 1 Capital					903,173			841,308
Total Capital					971,797			909,838
Tier 1 Capital Ratio		6	%		16.68	%		15.56	%
Total Capital Ratio		10	%		17.95	%		16.83	%
Tier 1 Leverage Ratio		5	%		6.73	%		6.30	%
As of December 31, 2010:
Shareholders' Equity				$	1,011,133		$	901,141
Tier 1 Capital					928,158			832,295
Total Capital					992,722			896,770
Tier 1 Capital Ratio		6	%		18.28	%		16.42	%
Total Capital Ratio		10	%		19.55	%		17.69	%
Tier 1 Leverage Ratio		5	%		7.15	%		6.46	%

The Company and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can result in certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classifications are also subject to qualitative judgments by regulators about the components of regulatory capital, risk weightings, and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios of Tier 1 and Total Capital. Tier 1 Capital is common shareholders' equity, reduced by certain intangible assets, postretirement benefit liability adjustments, and unrealized gains and losses on investment securities. Total Capital is Tier 1 Capital plus an allowable amount of the reserve for credit losses. Three capital ratios are used to measure capital adequacy: Tier 1 Capital divided by risk-weighted assets, as defined; Total Capital divided by risk-weighted assets; and the Tier 1 Leverage ratio, which is Tier 1 Capital divided by quarterly average total assets.

As of December 31, 2011, the Company and the Bank were well capitalized as defined in the regulatory framework for prompt corrective action. There were no conditions or events since December 31, 2011 that management believes have changed the Company or the Bank's capital ratings.

Dividends

Dividends paid by the Parent are substantially funded from dividends received from the Bank. The Bank is subject to federal and state regulatory restrictions that limit cash dividends and loans to the Parent. These restrictions generally require advanced approval from the Bank's regulator for payment of dividends in excess of the sum of net income for the current calendar year and the retained net income of the prior two calendar years.

Common Stock Repurchase Program

The Parent has a common stock repurchase program in which shares repurchased are held in treasury stock for reissuance in connection with share-based compensation plans and for general corporate purposes. For the year ended December 31, 2011, the Parent repurchased 2.5 million shares of common stock at an average cost per share of $43.88 and a total cost of $109.9 million. From the beginning of the stock repurchase program in July 2001 through December 31, 2011, the Parent repurchased a total of 48.5 million shares of common stock and returned a total of $1.7 billion to its shareholders at an average cost of $35.98 per share. Remaining buyback authority under the common stock repurchase program was $74.0 million as of December 31, 2011. From January 1, 2012 through February 14, 2012, the Parent repurchased an additional 190,000 shares of common stock at an average cost of $46.41 per share for a total of $8.8 million. Remaining buyback authority under the common stock repurchase program was $65.2 million as of February 14, 2012. The actual amount and timing of future share repurchases, if any, will depend on market conditions, applicable SEC rules and various other factors.

Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss), net of tax, which is a component of shareholders' equity were as follows:

(dollars in thousands)	Net Unrealized Gains (Losses) on Investment Securities			Defined Benefit Plans			Accumulated Other Comprehensive Income (Loss)
Balance, December 31, 2008	$	(4,277	)	$	(24,611	)	$	(28,888	)
Net change		30,567			5,246			35,813
Balance, December 31, 2009		26,290			(19,365	)		6,925
Net change		20,231			(191	)		20,040
Balance, December 31, 2010		46,521			(19,556	)		26,965
Net change		16,411			(8,113	)		8,298
Balance, December 31, 2011	$	62,932		$	(27,669	)	$	35,263

The following table presents the components of other comprehensive income, net of tax:

(dollars in thousands)	Before Tax			Tax Effect			Net of Tax
December 31, 2011:
Net Unrealized Gains on Investment Securities:
Net Unrealized Gains Arising During the Period	$	40,645		$	16,037		$	24,608
Less: Reclassification Adjustment for Gains Realized in Net Income		(13,525	)		(5,328	)		(8,197	)
Net Unrealized Gains on Investment Securities		27,120			10,709			16,411
Defined Benefit Plans:
Prior Service Credit from Plan Amendment During the Period		917			361			556
Less: Amortization of Prior Service Credit Included in Net Periodic Benefit Cost		(322	)		(127	)		(195	)
Net Prior Service Credit Arising During the Period		595			234			361
Net Actuarial Losses Arising During the Period		(13,981	)		(5,507	)		(8,474	)
Defined Benefit Plans, Net		(13,386	)		(5,273	)		(8,113	)
Other Comprehensive Income	$	13,734		$	5,436		$	8,298
December 31, 2010:
Net Unrealized Gains on Investment Securities:
Net Unrealized Gains Arising During the Period	$	78,494		$	33,941		$	44,553
Less: Reclassification Adjustment for Gains Realized in Net Income		(42,848	)		(18,526	)		(24,322	)
Net Unrealized Gains on Investment Securities		35,646			15,415			20,231
Defined Benefit Plans:
Settlement Gain Related to Defined Benefit Plan		(951	)		(343	)		(608	)
Net Actuarial Losses Arising During the Period		(842	)		(1,388	)		546
Less: Amortization of Prior Service Credit Included in Net Periodic Benefit Cost		(213	)		(84	)		(129	)
Defined Benefit Plans, Net		(2,006	)		(1,815	)		(191	)
Other Comprehensive Income	$	33,640		$	13,600		$	20,040
December 31, 2009:
Net Unrealized Gains on Investment Securities:
Net Unrealized Gains Arising During the Period	$	73,528		$	26,470		$	47,058
Less: Reclassification Adjustment for Gains Realized in Net Income		(25,770	)		(9,279	)		(16,491	)
Net Unrealized Gains on Investment Securities		47,758			17,191			30,567
Defined Benefit Plans:
Net Actuarial Gains Arising During the Period		8,410			3,028			5,382
Less: Amortization of Prior Service Credit Included in Net Periodic Benefit Cost		(213	)		(77	)		(136	)
Defined Benefit Plans, Net		8,197			2,951			5,246
Other Comprehensive Income	$	55,955		$	20,142		$	35,813