Stock-Based Compensation

9 Months Ended

Sep. 30, 2011

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The fair value of equity awards granted to employees is recognized as compensation expense over the period during which employees are required to provide service in exchange for such awards. The Corporation grants equity awards to employees, consisting of stock options and restricted stock, under its Stock Option and Compensation Plan (Employee Option Plan). In addition, employees may purchase stock under the Corporation’s Employee Stock Purchase Plan.

The following table presents compensation expense and the related tax benefits for equity awards recognized in the consolidated statements of income:

	Three Months Ended September 30						Nine Months Ended September 30
	2011			2010			2011			2010
	(in thousands)
Stock-based compensation expense	$	2,372		$	817		$	3,473		$	1,428
Tax benefit	(746		)	(192		)	(1,001		)	(320		)
Stock-based compensation expense, net of tax	$	1,626		$	625		$	2,472		$	1,108

Stock option fair values are estimated on the date of grant through the use of the Black-Scholes valuation methodology. Restricted stock fair values are equal to the average trading price of the Corporation’s stock on the date of grant. Restricted stock awards earn dividends during the vesting period, which are forfeitable if the awards do not vest. Stock options and restricted stock have historically been granted annually on July 1, 2011st and become fully vested over or after a three-year vesting period. Certain events, as defined in the Employee Option Plan, result in the acceleration of the vesting of both stock options and restricted stock. As of September 30, 2011, the Employee Option Plan had 12.2 million shares reserved for future grants through 2013. On July 1, 2011, the Corporation granted approximately 616,000 stock options and 317,000 shares of restricted stock under its Employee

Option Plan.

On July 1, 2011, the Corporation also granted approximately 11,000 shares of restricted stock to non-employee directors of the holding company under its 2011 Directors’ Equity Participation Plan (Directors’ Plan) that become fully vested after one year. Under the Directors’ Plan, the Corporation can grant equity awards to non-employee holding company and affiliate directors in the form of stock options, restricted stock or common stock. As of September 30, 2011, the Directors’ Plan had 489,000 shares reserved for future grants through 2021.