10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________

FORM 10-Q

(Mark One)

☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 2020
	or
☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from _________ to __________.

Commission File Number 001-39320

______________________

(Exact name of registrant as specified in its charter)

Delaware	36-3161078
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

8750 West Bryn Mawr Avenue, Suite 1300

Chicago, Illinois 60631-3655

(Address of principal executive offices) (zip code)

______________________

Registrant's telephone number, including area code: (708) 831-7483

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.01 par value	FMBI	The NASDAQ Stock Market
Depositary shares, each representing a 1/40th interest in a share of 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A	FMBIP	The NASDAQ Stock Market
Depositary shares, each representing a 1/40th interest in a share of 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C	FMBIO	The NASDAQ Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒.

As of August 3, 2020, there were 114,305,540 shares of common stock, $0.01 par value, outstanding.

FIRST MIDWEST BANCORP, INC.

FORM 10-Q

TABLE OF CONTENTS

		Page
Part I.	FINANCIAL INFORMATION
ITEM 1.	Financial Statements (Unaudited)
	Consolidated Statements of Financial Condition	3
	Condensed Consolidated Statements of Income	4
	Consolidated Statements of Comprehensive Income	5
	Consolidated Statements of Changes in Stockholders' Equity	6
	Consolidated Statements of Cash Flows	8
	Notes to the Condensed Consolidated Financial Statements	10
ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	41
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	73
ITEM 4.	Controls and Procedures	74
Part II.	OTHER INFORMATION
ITEM 1.	Legal Proceedings	74
ITEM 1A.	Risk Factors	74
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	76
ITEM 6.	Exhibits	77

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (Unaudited)

FIRST MIDWEST BANCORP, INC.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Amounts in thousands, except per share data)

					June 30, 2020		December 31, 2019
Assets					(Unaudited)
Cash and due from banks					$	304,445	$	214,894
Interest-bearing deposits in other banks					637,856		84,327
Equity securities, at fair value					43,954		42,136
Securities available-for-sale, at fair value					3,435,862		2,873,386
Securities held-to-maturity, at amortized cost, net					19,628		21,997
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") stock, at cost					148,512		115,409
Loans					14,933,658		12,840,330
Allowance for loan losses					(240,052)		(108,022)
Net loans					14,693,606		12,732,308
Other real estate owned ("OREO")					9,947		8,750
Premises, furniture, and equipment, net					143,001		147,996
Investment in bank-owned life insurance ("BOLI")					299,649		296,351
Goodwill and other intangible assets					940,182		875,262
Accrued interest receivable and other assets					568,239		437,581
Total assets					$	21,244,881	$	17,850,397
Liabilities
Noninterest-bearing deposits					$	5,602,016	$	3,802,422
Interest-bearing deposits					10,055,640		9,448,856
Total deposits					15,657,656		13,251,278
Borrowed funds					2,305,195		1,658,758
Senior and subordinated debt					234,358		233,948
Accrued interest payable and other liabilities					391,461		335,620
Total liabilities					18,588,670		15,479,604
Stockholders' Equity
Preferred stock					230,500		—
Common stock					1,253		1,204
Additional paid-in capital					1,268,647		1,211,274
Retained earnings					1,359,407		1,380,612
Accumulated other comprehensive income (loss), net of tax					28,727		(1,954)
Treasury stock, at cost					(232,323)		(220,343)
Total stockholders' equity					2,656,211		2,370,793
Total liabilities and stockholders' equity					$	21,244,881	$	17,850,397
	June 30, 2020				December 31, 2019
	(Unaudited)
	Preferred		Common		Preferred		Common
	Shares		Shares		Shares		Shares
Par value per share	$	—	$	0.01	$	—	$	0.01
Shares authorized	1,000		250,000		1,000		250,000
Shares issued	231		125,355		—		120,415
Shares outstanding	231		114,276		—		109,972
Treasury shares	—		11,079		—		10,443

See accompanying unaudited notes to the condensed consolidated financial statements.

3

FIRST MIDWEST BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Amounts in thousands, except per share data)

(Unaudited)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Interest Income
Loans	$	140,819	$	157,680	$	288,605	$	302,484
Investment securities	20,386		18,005		40,624		34,011
Other short-term investments	839		1,997		3,042		3,677
Total interest income	162,044		177,682		332,271		340,172
Interest Expense
Deposits	10,077		19,316		27,194		35,918
Borrowed funds	3,156		4,459		8,997		8,010
Senior and subordinated debt	3,577		3,595		7,271		6,908
Total interest expense	16,810		27,370		43,462		50,836
Net interest income	145,234		150,312		288,809		289,336
Provision for loan losses	32,649		11,491		72,181		21,935
Net interest income after provision for loan losses	112,585		138,821		216,628		267,401
Noninterest Income
Wealth management fees	11,942		12,190		24,303		23,790
Service charges on deposit accounts	9,125		12,196		20,906		23,736
Mortgage banking income	3,477		1,901		5,265		2,905
Card-based fees	3,180		4,549		7,148		8,927
Other service charges, commissions, and fees	2,078		2,783		4,760		5,394
Capital market products income	694		2,154		5,416		3,433
Net securities losses	—		—		(1,005)		—
Other income	2,495		2,753		5,560		5,247
Total noninterest income	32,991		38,526		72,353		73,432
Noninterest Expense
Salaries and employee benefits	63,672		58,692		126,531		116,065
Net occupancy and equipment expense	15,116		12,294		29,343		26,091
Technology and related costs	9,853		7,128		18,401		13,398
Professional services	8,880		9,624		19,270		16,711
Net OREO expense	126		294		546		975
Other expenses	17,434		16,154		32,849		29,107
Acquisition and integration related expenses	5,249		9,514		10,721		13,205
Delivering Excellence implementation costs	—		442		—		700
Total noninterest expense	120,330		114,142		237,661		216,252
Income before income tax expense	25,246		63,205		51,320		124,581
Income tax expense	6,182		16,191		12,650		31,509
Net income	$	19,064	$	47,014	$	38,670	$	93,072
Preferred dividends	(1,037)		—		(1,037)		—
Net income applicable to unvested restricted shares	(187)		(389)		(379)		(792)
Net income applicable to common shareholders	$	17,840	$	46,625	$	37,254	$	92,280
Per Common Share Data
Basic earnings per common share	$	0.16	$	0.43	$	0.33	$	0.86
Diluted earnings per common share	$	0.16	$	0.43	$	0.33	$	0.86
Dividends declared per common share	$	0.14	$	0.14	$	0.28	$	0.26
Weighted-average common shares outstanding	113,145		108,467		111,533		107,126
Weighted-average diluted common shares outstanding	113,336		108,467		111,872		107,126

See accompanying unaudited notes to the condensed consolidated financial statements.

4

FIRST MIDWEST BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Dollar amounts in thousands)

(Unaudited)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Net income	$	19,064	$	47,014	$	38,670	$	93,072
Securities Available-for-Sale
Unrealized holding (losses) gains:
Before tax	(1,719)		38,237		60,835		64,989
Tax effect	381		(10,649)		(16,916)		(18,100)
Net of tax	(1,338)		27,588		43,919		46,889
Reclassification of net losses included in net income:
Before tax	—		—		(1,005)		—
Tax effect	—		—		282		—
Net of tax	—		—		(723)		—
Net unrealized holding (losses) gains	(1,338)		27,588		43,196		46,889
Derivative Instruments
Unrealized holding (losses) gains:
Before tax	(7,300)		2,441		(17,340)		3,899
Tax effect	2,042		(680)		4,825		(1,086)
Net of tax	(5,258)		1,761		(12,515)		2,813
Total other comprehensive (loss) income	(6,596)		29,349		30,681		49,702
Total comprehensive income	$	12,468	$	76,363	$	69,351	$	142,774

	Accumulated Unrealized (Loss) Gain on Securities Available- for-Sale		Accumulated Unrealized (Loss) Gain on Derivative Instruments		Unrecognized Net Pension Costs		Total Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2018	$	(28,792)	$	(2,550)	$	(21,170)	$	(52,512)
Other comprehensive income	46,889		2,813		—		49,702
Balance at June 30, 2019	$	18,097	$	263	$	(21,170)	$	(2,810)
Balance at December 31, 2019	$	15,808	$	819	$	(18,581)	$	(1,954)
Other comprehensive income	43,196		(12,515)		—		30,681
Balance at June 30, 2020	$	59,004	$	(11,696)	$	(18,581)	$	28,727

See accompanying unaudited notes to the condensed consolidated financial statements.

5

FIRST MIDWEST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(Amounts in thousands, except per share data)

(Unaudited)

	Common Shares Outstanding	Preferred Stock		Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total
Quarter Ended June 30, 2019
Beginning balance	106,900	$	—	$	1,157	$	1,103,991	$	1,273,245	$	(32,159)	$	(186,763)	$	2,159,471
Net income	—	—		—		—		47,014		—		—		47,014
Other comprehensive income	—	—		—		—		—		29,349		—		29,349
Common dividends declared   ($0.14 per common share)	—	—		—		—		(15,503)		—		—		(15,503)
Repurchases of common stock	(1,042)	—		—		—		—		—		(21,190)		(21,190)
Acquisitions, net of issuance costs	4,729	—		47		98,165		—		—		—		98,212
Common stock issued	3	—		—		68		—		—		—		68
Restricted stock activity	1	—		—		(7)		—		—		12		5
Treasury stock issued to benefit plans	(2)	—		—		(5)		—		—		(32)		(37)
Share-based compensation expense	—	—		—		3,184		—		—		—		3,184
Balance at June 30, 2019	110,589	$	—	$	1,204	$	1,205,396	$	1,304,756	$	(2,810)	$	(207,973)	$	2,300,573
Quarter Ended June 30, 2020
Beginning balance	114,213	$	—	$	1,253	$	1,274,935	$	1,357,395	$	35,323	$	(233,199)	$	2,435,707
Net income	—	—		—		—		19,064		—		—		19,064
Other comprehensive income	—	—		—		—		—		(6,596)		—		(6,596)
Preferred dividends	—	—		—		—		(1,037)		—		—		(1,037)
Common dividends declared   ($0.14 per common share)	—	—		—		—		(16,015)		—		—		(16,015)
Preferred stock issued	—	230,500		—		(9,188)		—		—		—		221,312
Common stock issued	6	—		—		79		—		—		—		79
Restricted stock activity	64	—		—		(912)		—		—		943		31
Treasury stock issued to benefit plans	(7)	—		—		(22)		—		—		(67)		(89)
Share-based compensation expense	—	—		—		3,755		—		—		—		3,755
Balance at June 30, 2020	114,276	$	230,500	$	1,253	$	1,268,647	$	1,359,407	$	28,727	$	(232,323)	$	2,656,211

6

FIRST MIDWEST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY – (Continued)

(Amounts in thousands, except per share data)

(Unaudited)

	Common Shares Outstanding	Preferred Stock		Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total
Six Months Ended June 30, 2019
Beginning balance	106,375	$	—	$	1,157	$	1,114,580	$	1,192,767	$	(52,512)	$	(200,994)	$	2,054,998
Adjustment to apply recent   accounting   pronouncements(1)	—	—		—		—		47,257		—		—		47,257
Net income	—	—		—		—		93,072		—		—		93,072
Other comprehensive loss	—	—		—		—		—		49,702		—		49,702
Common dividends declared   ($0.26 per common share)	—	—		—		—		(28,340)		—		—		(28,340)
Repurchases of common stock	(1,042)	—		—		—		—		—		(21,190)		(21,190)
Acquisitions, net of issuance costs	4,879	—		47		97,351		—		—		4,098		101,496
Common stock issued	30	—		—		(69)		—		—		674		605
Restricted stock activity	353	—		—		(13,320)		—		—		9,550		(3,770)
Treasury stock issued to benefit plans	(6)	—		—		(9)		—		—		(111)		(120)
Share-based compensation expense	—	—		—		6,863		—		—		—		6,863
Balance at June 30, 2019	110,589	$	—	$	1,204	$	1,205,396	$	1,304,756	$	(2,810)	$	(207,973)	$	2,300,573
Six Months Ended June 30, 2020
Beginning balance	109,972	$	—	$	1,204	$	1,211,274	$	1,380,612	$	(1,954)	$	(220,343)	$	2,370,793
Adjustment to apply recent   accounting   pronouncements(2)	—	—		—		—		(26,821)		—		—		(26,821)
Net income	—	—						38,670						38,670
Other comprehensive income	—	—		—		—		—		30,681		—		30,681
Preferred dividends	—	—		—		—		(1,037)		—		—		(1,037)
Common dividends declared   ($0.28 per common share)	—	—		—		—		(32,017)		—		—		(32,017)
Repurchases of common stock	(1,171)	—		—		—		—		—		(22,557)		(22,557)
Acquisition, net of issuance costs	4,930	—		49		71,834		—		—		—		71,883
Preferred stock issued	—	230,500		—		(9,188)		—		—		—		221,312
Common stock issued	43	—		—		251		—		—		679		930
Restricted stock activity	513	—		—		(13,180)		—		—		10,045		(3,135)
Treasury stock issued to benefit plans	(11)	—		—		(21)		—		—		(147)		(168)
Share-based compensation expense	—	—		—		7,677		—		—		—		7,677
Balance at June 30, 2020	114,276	$	230,500	$	1,253	$	1,268,647	$	1,359,407	$	28,727	$	(232,323)	$	2,656,211

⁽¹⁾As a result of accounting guidance adopted in the first quarter of 2019, the remaining deferred gain on a sale-leaseback transaction was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2019.

⁽²⁾As a result of accounting guidance adopted in the first quarter of 2020, a portion of the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

See accompanying unaudited notes to the condensed consolidated financial statements.

7

FIRST MIDWEST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollar amounts in thousands)

(Unaudited)

	Six Months Ended   June 30,
	2020		2019
Operating Activities
Net income	$	38,670	$	93,072
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	72,181		21,935
Depreciation of premises, furniture, and equipment	8,397		8,093
Net amortization of premium on securities	10,914		6,609
Net securities losses	1,005		—
Gains on sales of 1-4 family mortgages and corporate loans held-for-sale	(7,230)		(3,391)
Net losses (gains) on sales and valuation adjustments of OREO	128		(1,169)
Amortization of the FDIC indemnification asset	892		604
Net losses on sales and valuation adjustments of premises, furniture, and equipment	213		1,252
BOLI income	(3,798)		(3,645)
Share-based compensation expense	7,677		6,863
Tax benefit related to share-based compensation	148		160
Amortization of other intangible assets	5,590		4,987
Originations of mortgage loans held-for-sale	(297,019)		(164,398)
Proceeds from sales of mortgage loans held-for-sale	292,410		154,191
Net increase in equity securities	(1,818)		(2,918)
Net (increase) decrease in accrued interest receivable and other assets	(124,850)		19,027
Net increase (decrease) in accrued interest payables and other liabilities	12,871		(36,151)
Net cash provided by operating activities	16,381		105,121
Investing Activities
Proceeds from maturities, repayments, and calls of securities available-for-sale	497,430		167,502
Proceeds from sales of securities available-for-sale	39,095		93,332
Purchases of securities available-for-sale	(914,234)		(460,066)
Proceeds from maturities, repayments, and calls of securities held-to-maturity	2,467		3,162
Purchases of securities held-to-maturity	(18)		(2,837)
Net purchases of FHLB stock	(33,103)		(27,683)
Net increase in loans	(1,360,147)		(394,713)
Premiums paid on BOLI, net of proceeds from claims	2,997		3,260
Proceeds from sales of OREO	230		5,236
Proceeds from sales of premises, furniture, and equipment	—		2,291
Purchases of premises, furniture, and equipment	(4,647)		(10,360)
Net cash received from (paid for) acquisition	142,282		(13,532)
Net cash used in investing activities	(1,627,648)		(634,408)
Financing Activities
Net increase in deposit accounts	1,456,302		117,722
Net increase in borrowed funds	634,905		499,553
Net proceeds from the issuance of preferred stock	221,312		—
Repurchases of common stock	(22,557)		(21,190)
Cash dividends paid	(32,480)		(25,636)
Restricted stock activity	(3,135)		(3,770)
Net cash provided by financing activities	2,254,347		566,679
Net increase in cash and cash equivalents	643,080		37,392
Cash and cash equivalents at beginning of period	299,221		289,258
Cash and cash equivalents at end of period	$	942,301	$	326,650

8

FIRST MIDWEST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS – (Continued)

(Dollar amounts in thousands)

(Unaudited)

	Six Months Ended   June 30,
	2020		2019
Supplemental Disclosures of Cash Flow Information:
Income taxes paid	$	587	$	16,948
Interest paid to depositors and creditors	46,331		47,750
Dividends declared, but unpaid	15,857		15,377
Stock issued for acquisitions, net of issuance costs	71,883		101,496
Non-cash transfers of loans to OREO	121		322
Non-cash transfers of loans to other assets	—		13,175
Non-cash transfers of loans held-for-investment to loans held-for-sale	2,193		4,762
Non-cash recognition of right-of-use asset	—		143,561
Non-cash recognition of lease liability	—		143,561
See accompanying unaudited notes to the condensed consolidated financial statements.

9

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation – The accompanying unaudited condensed consolidated interim financial statements ("consolidated financial statements") of First Midwest Bancorp, Inc. (the "Company"), a Delaware corporation, were prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q and reflect all adjustments that management deems necessary for the fair presentation of the financial position and results of operations for the periods presented. The results of operations for the quarter and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.

The accounting and reporting policies of the Company and its subsidiaries conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. The accompanying consolidated financial statements do not include certain information and note disclosures required by GAAP for complete annual financial statements. Therefore, these financial statements should be read in conjunction with the Company's 2019 Annual Report on Form 10-K ("2019 10-K"). The Company uses the accrual basis of accounting for financial reporting purposes. Certain reclassifications were made to prior year amounts to conform to the current year presentation.

Use of Estimates – The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates and assumptions are based on the best available information, actual results could differ from those estimates.

Principles of Consolidation – The accompanying consolidated financial statements include the financial position and results of operations of the Company and its subsidiaries after elimination of all significant intercompany accounts and transactions. Assets held in a fiduciary or agency capacity are not assets of the Company or its subsidiaries and are not included in the consolidated financial statements.

The accounting policies related to business combinations, loans, the allowance for credit losses, lease obligations, and derivative financial instruments are presented below. For a summary of all other significant accounting policies, see Note 1, "Summary of Significant Accounting Policies," in the Company's 2019 10-K.

Business Combinations – Business combinations are accounted for under the acquisition method of accounting. Assets acquired and liabilities assumed are recorded at their estimated fair values as of the date of acquisition, with any excess of the purchase price of the acquisition over the fair value of the identifiable net tangible and intangible assets acquired recorded as goodwill. Alternatively, a gain is recorded if the fair value of assets purchased exceeds the fair value of liabilities assumed and consideration paid. The results of operations of the acquired business are included in the Condensed Consolidated Statements of Income from the effective date of the acquisition.

Allowance for Securities Held-to-Maturity – The Company maintains an allowance for securities held-to-maturity for the risk of loss inherent in these financial assets, which reflects the difference between the carrying value and the discounted expected future cash flows of these assets and is included in securities held-to-maturity, at amortized cost, net in the Consolidated Statements of Financial Condition.

Loans – Loans held-for-investment are loans that the Company intends to hold until they are paid in full and are carried at the principal amount outstanding, including certain net deferred loan origination fees. Loan origination fees, commitment fees, and certain direct loan origination costs are deferred, and the net amount is amortized as a yield adjustment over the contractual life of the related loans or commitments and included in interest income. Fees related to letters of credit are amortized into fee income over the contractual life of the commitment. Other credit-related fees are recognized as fee income when earned. The Company's net investment in direct financing leases is included in loans and consists of future minimum lease payments and estimated residual values, net of unearned income. Interest income on loans is accrued based on principal amounts outstanding. Loans held-for-sale are carried at the lower of aggregate cost or fair value and included in other assets in the Consolidated Statements of Financial Condition.

Acquired Loans – Acquired loans consist of all loans that were acquired in business combinations, including loans which are covered by Federal Deposit Insurance Corporation ("FDIC") Agreements. Acquired loans are included within loans held-for-investment.

Acquired loans are separated into (i) non-purchased credit deteriorated ("non-PCD") loans and (ii) purchased credit deteriorated ("PCD") loans. Non-PCD loans include loans that did not have evidence of more-than-insignificant credit deterioration since origination at the acquisition date. PCD loans include loans that had evidence of more-than-insignificant credit deterioration

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since origination. Evidence of credit deterioration was evaluated using various indicators, such as past due and non-accrual status. Leases and revolving loans do not qualify to be accounted for as PCD loans and are accounted for as non-PCD loans.

The acquisition adjustment related to non-PCD loans is amortized into interest income over the contractual life of the related loans. If an acquired non-PCD loan is renewed subsequent to the acquisition date, any remaining acquisition adjustment is accreted into interest income and the loan is considered a new loan that is no longer classified as an acquired loan.

PCD loans are generally accounted for based on estimates of expected future cash flows. The Company uses a discounted cash flow analysis involving significant unobservable inputs and assumptions to measure the fair value of PCD loans. The significant assumptions utilized in the cash flow analysis include the probability of default ("PD"), loss given default ("LGD"), and discount rate. PCD loans are recorded at fair value, excluding credit-related adjustments, for which an allowance for loan losses is established at the acquisition date through purchase accounting adjustments. Expected future cash flows in excess of the fair value of loans at the purchase date ("accretable yield") are recorded as interest income over the life of the loans if the timing and amount of the expected future cash flows can be reasonably estimated. Subsequent to the acquisition date, the allowance for loan losses on PCD loans is estimated as are the allowances for all other loans in the portfolio.

Prior to the adoption of the current expected credit losses ("CECL") accounting guidance on January 1, 2020, acquired loans were separated into (i) non-purchased credit impaired ("non-PCI") loans and (ii) purchased credit impaired ("PCI") loans. The significant accounting policies related to non-PCI and PCI acquired loans are presented in Note 1, "Summary of Significant Accounting Policies" to the Consolidated Financial Statements in the Company's 2019 10-K.

90-Days Past Due Loans – The Company's accrual of interest on loans is generally discontinued at the time the loan is 90 days past due unless the credit is sufficiently collateralized and in the process of renewal or collection.

Non-accrual Loans – Generally, corporate loans are placed on non-accrual status (i) when either principal or interest payments become 90 days or more past due unless the credit is sufficiently collateralized and in the process of renewal or collection, or (ii) when an individual analysis of a borrower's creditworthiness warrants a downgrade to non-accrual regardless of past due status. When a loan is placed on non-accrual status, unpaid interest credited to income in the current year is reversed, and unpaid interest accrued in prior years is charged against the allowance for loan losses. After the loan is placed on non-accrual status, all debt service payments are applied to the principal on the loan. Future interest income may only be recorded on a cash basis after recovery of principal is reasonably assured. Non-accrual loans are returned to accrual status when the financial position of the borrower and other relevant factors indicate that the Company will collect all principal and interest.

Non-accrual loans with balances under a specified threshold are not individually evaluated for impairment. For all other non-accrual loans, impairment is measured by comparing the estimated value of the loan to the recorded book value. The value of collateral-dependent loans is based on the fair value of the underlying collateral, less costs to sell. The value of other loans is measured using the present value of expected future cash flows discounted at the loan's effective interest rate.

Commercial loans and loans secured by real estate are charged-off when deemed uncollectible. A loss is recorded if the net realizable value of the underlying collateral is less than the outstanding principal and interest. Consumer loans that are not secured by real estate are subject to mandatory charge-off at a specified delinquency date and are usually not classified as non-accrual prior to being charged-off. Closed-end consumer loans, which include installment, automobile, and single payment loans, are usually charged-off no later than the end of the month in which the loan becomes 120 days past due.

Troubled Debt Restructurings ("TDRs") – A restructuring is considered a TDR when (i) the borrower is experiencing financial difficulties, and (ii) the creditor grants a concession, such as forgiveness of principal, reduction of the interest rate, changes in payments, or extension of the maturity date. Loans are not classified as TDRs when the modification is short-term or results in an insignificant delay in payments. The Company's TDRs are determined on a case-by-case basis.

The Company does not accrue interest on a TDR unless it believes collection of all principal and interest under the modified terms is reasonably assured. For a TDR to begin accruing interest, the borrower must demonstrate some level of past performance and the future capacity to perform under the modified terms. Generally, six months of consecutive payment performance under the restructured terms is required before a TDR is returned to accrual status. However, the period could vary depending on the individual facts and circumstances of the loan. An evaluation of the borrower's current creditworthiness is used to assess the borrower's capacity to repay the loan under the modified terms. This evaluation includes an estimate of expected future cash flows, evidence of strong financial position, and estimates of the value of collateral, if applicable. For TDRs to be removed from TDR status in the calendar year after the restructuring, the loans must (i) have an interest rate and terms that reflect market conditions at the time of restructuring, and (ii) be in compliance with the modified terms. If the loan was restructured at below market rates and terms, it continues to be separately reported as restructured until it is paid in full or charged-off.

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Allowance for Credit Losses – The allowance for credit losses is comprised of the allowance for loan losses and the allowance for unfunded commitments and is maintained by management at a level believed adequate to absorb current expected credit losses in the existing loan portfolio. Determination of the allowance for credit losses is subjective since it requires significant estimates and management judgment, including the amounts and timing of expected future cash flows, actual loss experience, consideration of current national, regional, and local economic trends and conditions, reasonable and supportable forecasts about the future, changes in interest rates and property values, various internal and external qualitative factors, and other factors.

Loans deemed to be uncollectible are charged-off against the allowance for loan losses, while recoveries of amounts previously charged-off are credited to the allowance for loan losses. Additions to the allowance for loan losses are charged to expense through the provision for loan losses. The amount of provision depends on a number of factors, including net charge-off levels, loan growth, changes in the composition of the loan portfolio, and the Company's assessment of the allowance for loan losses based on the methodology discussed below.

Allowance for Loan Losses – The allowance for loan losses consists of (i) specific allowance for individual loans where the recorded investment exceeds the value, (ii) an allowance based on historical credit loss experience with consideration of reasonable and supportable forecasts of economic conditions for each loan category, and (iii) an allowance based on other internal and external qualitative factors.

The allowance for individual loans is based on a periodic analysis of non-accrual loans individually exceeding a specific dollar amount. If the estimated value of a non-accrual loan is less than its recorded book value, the Company either (i) provides an allowance in the amount of the excess of the book value over the estimated value of the related loan or, (ii) if the loss is confirmed, charges off the loss.

The allowance by loan category is based on a discounted cash flows analysis as future cash flows are discounted at an effective rate of return. In addition, estimates of losses on future cash flows is forecasted by applying probability of default and loss given default factors as well as prepayment and curtailment assumptions to cash flows that are adjusted to a present value. This discounted cash flow analysis is updated quarterly, primarily using actual loss experience adjusted for current reasonable and supportable forecasts of economic conditions over a one-year forecast period. After the one-year forecast period, a one-year reversion period adjusts loss experience to the historical average on a straight-line basis. These forecasts consider multiple scenarios of key assumptions including national unemployment rates, housing price indices, and gross domestic product.

This general allowance component is then adjusted based on management's consideration of many internal and external qualitative factors, including:

•Changes in the composition of the loan portfolio, trends in the volume of loans, and trends in delinquent and non-accrual loans that could indicate that historical trends do not reflect current conditions.

•Changes in credit policies and procedures, such as underwriting standards and collection, charge-off, and recovery practices.

•Changes in the experience, ability, and depth of credit management and other relevant staff.

•Changes in the quality of the Company's loan review system and Board of Directors oversight.

•The effect of any concentration of credit and changes in the level of concentrations, such as loan type or risk rating.

•Changes in the value of the underlying collateral for collateral-dependent loans.

•Changes in the national, regional, and local economy that affect the collectability of various segments of the portfolio.

•The effect of other external factors, such as competition and legal and regulatory requirements, on the Company's loan portfolio.

The allowance for loan losses also includes an allowance on acquired non-PCD and PCD loans. An allowance for loan losses is recorded on acquired PCD loans at the acquisition date through purchase accounting adjustments. Subsequent to the acquisition date, the allowance for loan losses on PCD loans is estimated as are the allowances for all other loans in the portfolio. No allowance for loan losses is recorded on acquired non-PCD loans at the acquisition date through purchase accounting. Instead, an allowance is established on acquired non-PCD loans at the acquisition date in-line with all other loans in the portfolio as if the loans were originated at the acquisition date. On a periodic basis, the adequacy of this allowance is determined using either a PD/LGD methodology or a specific review methodology.

Allowance for Unfunded Commitments – The Company also maintains an allowance for unfunded commitments, including letters of credit, for the risk of loss inherent in these arrangements. The allowance for unfunded commitments is estimated using the historical credit loss experience with consideration of reasonable and supportable forecasts of economic conditions for each loan category. The allowance for unfunded commitments is included in other liabilities in the Consolidated Statements of Financial Condition.

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The establishment of the allowance for credit losses involves a high degree of judgment and estimation given the difficulty of assessing the factors impacting loan repayment and estimating the timing and amount of losses. While management utilizes its best judgment and information available, the adequacy of the allowance for credit losses depends on a variety of factors beyond the Company's control, including the performance of its loan portfolio, current national, regional, and local economic trends, reasonable and supportable forecasts about the future, changes in interest rates and property values, the amounts and timing of expected future cash flows on non-accrual loans, estimated losses on pools of homogenous loans, the interpretation of loan risk classifications by regulatory authorities, various internal and external qualitative factors, and other factors.

Lease Obligations – The Company leases certain premises under non-cancelable operating leases in the normal course of business operations. These lease obligations result in the recognition of right-of-use assets and associated lease liabilities. The amount of right-of-use assets and associated lease liabilities recorded is based on the present value of future minimum lease payments. Right-of-use assets are amortized on a straight-line basis over the estimated useful lives of the related premises, and interest associated with the net present value of future minimum lease payments is included in net occupancy and equipment expense in the consolidated financial statements.

Derivative Financial Instruments – To provide derivative products to customers and in the ordinary course of business, the Company enters into derivative transactions as part of its overall interest rate risk management strategy to minimize significant unplanned fluctuations in earnings and expected future cash flows caused by interest rate volatility. All derivative instruments are recorded at fair value as either other assets or other liabilities in the Consolidated Statements of Financial Condition. Subsequent changes in a derivative's fair value are recognized in earnings unless specific hedge accounting criteria are met.

On the date the Company enters into a derivative contract, the derivative is designated as a fair value hedge, a cash flow hedge, or a non-hedge derivative instrument. Fair value hedges are designed to mitigate exposure to changes in the fair value of an asset or liability attributable to a particular risk, such as interest rate risk. Cash flow hedges are designed to mitigate exposure to variability in expected future cash flows to be received or paid related to an asset, liability, or other type of forecasted transaction. The Company formally documents all relationships between hedging instruments and hedged items, including its risk management objective and strategy at inception.

At the hedge's inception, a formal assessment is performed to determine the effectiveness of the derivative in offsetting changes in the fair values or expected future cash flows of the hedged items in the current period and prospectively. If a derivative instrument designated as a hedge is terminated or ceases to be highly effective, hedge accounting is discontinued prospectively, and the gain or loss is amortized into earnings. For fair value hedges, the gain or loss is amortized over the remaining life of the hedged asset or liability. For cash flow hedges, the gain or loss is amortized over the same period that the forecasted hedged transactions impact earnings. If the hedged item is disposed of, any fair value adjustments are included in the gain or loss from the disposition of the hedged item. If the forecasted transaction is no longer probable, the gain or loss is included in earnings immediately.

For fair value hedges, changes in the fair value of the derivative instruments, as well as changes in the fair value of the hedged item, are recognized in earnings in the same income statement line item as the earnings effect of the hedged item. For cash flow hedges, the effective portion of the change in fair value of the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and is reclassified to earnings when the hedged transaction is reflected in earnings.

2. RECENT ACCOUNTING PRONOUNCEMENTS AND OTHER GUIDANCE

Adopted Accounting Pronouncements

Measurement of Credit Losses on Financial Instruments: In June of 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2016-13 that requires entities to present financial assets measured at amortized cost at the net amount expected to be collected, considering an entity's current estimate of all expected credit losses. In addition, credit losses relating to available-for-sale debt securities are required to be recorded through an allowance for credit losses, with changes in credit loss estimates recognized through current earnings. This guidance is effective for annual and interim periods beginning after December 15, 2019.

The Company adopted this guidance on January 1, 2020, which resulted in the recognition of $76.0 million of allowance for credit losses which includes $26.0 million attributable to loans, $5.6 million attributable to unfunded commitments, $35.7 million attributable to PCD loans, $8.5 million attributable to non-PCD acquired loans, and $220,000 attributable to securities held-to-maturity. The portion of the allowance for credit losses attributable to PCD loans did not have an impact on equity as the credit-related portion of acquisition adjustments on loans previously classified as PCI transitioned to PCD accounting treatment upon adoption. The amount of allowance for credit losses recognized upon adoption was based on the composition of the loan portfolio, as well as the economic conditions and forecasts as of the adoption date. The Company adopted this guidance using the modified retrospective approach which resulted in the recognition of a $26.8 million after-tax

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reduction to retained earnings as a cumulative-effect adjustment on January 1, 2020. Prior period amounts continue to be reported in accordance with previously applicable standards and the accounting policies described in the Company's 2019 10-K.

The Company has made the following elections upon adoption of ASU 2016-13:

•When determining the allowance and net carrying value amount for financial assets in which the repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty, the Company will use the fair value of collateral at the reporting date.

•The Company writes off uncollectible accrued interest in a timely manner and, therefore, will not measure an allowance for credit losses for accrued interest receivable.

•The Company uses a discounted cash flow approach for the majority of its applicable instruments. The change in the present value from one reporting period to the next may result from the passage of time, in addition to changes in estimates of the timing of the cash flows. The Company will report the entire change in the present value as provision for loan losses (or reversal of provision for loan losses) versus reporting the change related to the passage of time as interest income.

For additional discussion of the allowance for credit losses, see Note 7 "Past Due Loans, Allowance for Credit Losses, Non-Accrual Loans, and TDRs."

Accounting for Goodwill Impairment: In January of 2017, the FASB issued ASU 2017-04 that simplifies the accounting for goodwill impairment for all entities. The new guidance eliminates the requirement to calculate the implied fair value of goodwill using the second step of the quantitative two-step goodwill impairment model prescribed under current accounting guidance. Under the new guidance, if a reporting unit's carrying amount exceeds its fair value, an entity will record an impairment charge based on that difference. This guidance is effective for annual and interim goodwill impairment testing dates beginning after December 15, 2019. The adoption of this guidance on January 1, 2020 did not materially impact the Company's financial condition, results of operations, or liquidity.

Changes to the Disclosure Requirements for Fair Value Measurement: In August of 2018, the FASB issued ASU 2018-13 that eliminates, modifies, and adds to certain fair value measurement disclosure requirements associated with the three-tiered fair value hierarchy. This guidance is effective for annual and interim periods beginning after December 15, 2019. The adoption of this guidance on January 1, 2020 did not materially impact the Company's financial condition, results of operations, or liquidity.

Loan Modifications Due to COVID-19: In March of 2020, the CARES Act was enacted by the U.S. government in response to the economic disruption caused by the COVID-19 pandemic (the "pandemic"). The Company's banking regulators issued a statement titled the "Interagency Statement on Loan Modifications by Financial Institutions Working with Customers Affected by the Coronavirus" that encourages financial institutions to work prudently with borrowers who are or may be unable to meet their contractual payment obligations due to the effects of the pandemic. Additionally, the CARES Act provides that a qualified loan modification is exempt by law from classification as a TDR as defined by GAAP, from the period beginning March 1, 2020 until the earlier of December 31, 2020 or the date that is 60 days after the date on which the national emergency concerning the pandemic declared by the President of the United States terminates. Accordingly, the Company is offering short-term modifications made in response to the pandemic to borrowers who are current and otherwise not past due. These include short-term modifications in the form of payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. The total balance of loans with eligible modifications as of June 30, 2020 was $1.9 billion.

Regulatory Capital Delay of CECL Impact: In February of 2019, the federal bank regulatory agencies issued a final rule, the 2019 CECL Rule, that revised certain capital regulations to account for changes to credit loss accounting under U.S. GAAP. The 2019 CECL Rule included a transition option that allows banking organizations to phase in, over a three-year period, the day-one adverse effects of CECL on their regulatory capital ratios (three-year transition option). In March of 2020, the federal bank regulatory agencies issued an interim final rule that maintains the three year transition option of the 2019 CECL Rule and also provides banking organizations that were required under GAAP (as of January 2020) to implement CECL before the end of 2020 the option to delay for two years an estimate of the effect of CECL on regulatory capital, relative to the incurred loss methodology's effect on regulatory capital, followed by a three-year transition period (five-year transition option). The Company elected to adopt the five-year transition option. This election of the transition option is applicable only to regulatory capital computations under federal banking regulations and does not otherwise impact the financial statements prepared in accordance with GAAP.

Accounting Pronouncements Pending Adoption

Changes to the Disclosure Requirements for Defined Benefit Plans: In August of 2018, the FASB issued ASU 2018-14 that makes minor changes and clarifications to the disclosure requirements for entities that sponsor defined benefit plans. This guidance is effective for annual and interim periods beginning after December 15, 2020. Early adoption is permitted.

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Management does not expect the adoption of this guidance will materially impact the Company's financial condition, results of operations, or liquidity.

Income Taxes: In December of 2019, the FASB issued ASU 2019-12 that removes certain exceptions to the general principles of accounting for income taxes. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. Management does not expect the adoption of this guidance will materially impact the Company's financial condition, results of operations, or liquidity.

Reference Rate Reform: In March of 2020, the FASB issued ASU 2020-04 that provides optional expedients and exceptions for applying GAAP to contracts and other transactions affected by reference rate reform, if certain criteria are met. This guidance is effective as of March 12, 2020 through December 31, 2022. Management is in the process of determining the impact on the Company's financial condition, results of operations, and liquidity.

3. ACQUISITIONS

Completed Acquisitions

Park Bank

On March 9, 2020, the Company completed its acquisition of Bankmanagers Corp. ("Bankmanagers"), the holding company for Park Bank, based in Milwaukee Wisconsin. At closing, the Company acquired $1.2 billion of assets, $1.0 billion of deposits, and $685.5 million of loans, net of fair value adjustments. Under the terms of the merger agreement, on March 9, 2020, each outstanding share of Bankmanagers common stock was exchanged for 29.9675 shares of Company common stock, plus $623.02 of cash (of which $346.00 per share was paid by Bankmanagers to its shareholders by a special cash dividend immediately prior to closing). This resulted in merger consideration of $174.4 million, which consisted of 4.9 million shares of Company common stock and $102.5 million of cash. Goodwill of $62.4 million associated with the acquisition was recorded by the Company. All Park Bank operating systems were converted to the Company's operating platform during the second quarter of 2020. The fair value adjustments, including goodwill, associated with the transaction remain preliminary and may change as the Company continues to finalize the fair value of the assets and liabilities acquired.

During the second quarter of 2020, the Company updated the fair value adjustments associated with the Bankmanagers transaction. These adjustments were recognized in the current period in accordance with accounting guidance applicable to business combinations.

Bridgeview Bank Group

On May 9, 2019, the Company completed its acquisition of Bridgeview Bancorp, Inc. ("Bridgeview"), the holding company for Bridgeview Bank Group. At closing, the Company acquired $1.2 billion of assets, $1.0 billion of deposits, and $709.4 million of loans, net of fair value adjustments. Under the terms of the merger agreement, on May 9, 2019, each outstanding share of Bridgeview common stock was exchanged for 0.2767 shares of Company common stock, plus $1.66 of cash. In addition, each outstanding Bridgeview stock option was exchanged for the right to receive cash. This resulted in merger consideration of $135.4 million, which consisted of 4.7 million shares of Company common stock and $37.1 million of cash. Goodwill of $63.2 million associated with the acquisition was recorded by the Company. All Bridgeview operating systems were converted to the Company's operating platform during the second quarter of 2019.

During the second quarter of 2020, the Company finalized the fair value adjustments associated with the Bridgeview transaction, which required measurement period adjustments to goodwill. These adjustments were recognized in the current period in accordance with accounting guidance applicable to business combinations.

Northern Oak Wealth Management, Inc.

On January 16, 2019, the Company completed its acquisition of Northern Oak Wealth Management, Inc., a registered investment adviser based in Milwaukee, Wisconsin with approximately $800.0 million of assets under management at closing. During the first quarter of 2020, the Company finalized the fair value adjustments associated with the Northern Oak transaction, which required a measurement period adjustment to goodwill. This adjustment was recognized in the current period in accordance with accounting guidance applicable to business combinations.

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The following table presents the assets acquired and liabilities assumed, net of the fair value adjustments, in the Park Bank and Bridgeview transactions as of the acquisition date. The assets acquired and liabilities assumed, both intangible and tangible, were recorded at their estimated fair values as of the acquisition date and have been accounted for under the acquisition method of accounting.

Acquisition Activity

(Dollar amounts in thousands, except share and per share data)

	Park Bank		Bridgeview
	March 9, 2020		May 9, 2019
Assets
Cash and due from banks and interest-bearing deposits in other banks	$	244,781	$	35,097
Equity securities	—		6,966
Securities available-for-sale	136,856		263,090
Securities held-to-maturity	300		13,426
FHLB and FRB stock	—		1,481
Loans	685,451		709,438
OREO	2,001		5,436
Goodwill	62,433		63,231
Other intangible assets	3,068		15,603
Premises, furniture, and equipment	2,550		16,138
Accrued interest receivable and other assets	13,796		35,909
Total assets	$	1,151,236	$	1,165,815
Liabilities
Noninterest-bearing deposits	$	356,050	$	179,267
Interest-bearing deposits	594,026		807,487
Total deposits	950,076		986,754
Borrowed funds	11,532		1,746
Senior and subordinated debt	—		29,360
Accrued interest payable and other liabilities	15,246		12,603
Total liabilities	976,854		1,030,463
Consideration Paid
Common stock (2020 – 4,930,231, shares issued at $14.58 per share, 2019 –   4,728,541, shares issued at $20.77 per share), net of issuance costs	71,883		98,212
Cash paid	102,499		37,140
Total consideration paid	174,382		135,352
	$	1,151,236	$	1,165,815

Expenses related to the acquisition and integration of completed and pending transactions are reported as a separate component within noninterest expense in the Condensed Consolidated Statements of Income. For the quarter and six months ended June 30, 2020, these expenses totaled $5.2 million and $10.7 million respectively, and for the same periods in 2019, these expenses totaled $9.5 million and $13.2 million, respectively.

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4. SECURITIES

The significant accounting policies related to securities are presented in Note 1, "Summary of Significant Accounting Policies" to the Consolidated Financial Statements in the Company's 2019 10-K.

A summary of the Company's securities portfolio by category and maturity is presented in the following tables.

Securities Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized				Fair Value		Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses						Gains		Losses
Securities Available-for-Sale
U.S. treasury securities	$	20,992	$	207	$	—	$	21,199	$	33,939	$	137	$	(1)	$	34,075
U.S. agency securities	640,253		4,166		(1,372)		643,047		249,502		758		(1,836)		248,424
Collateralized mortgage obligations ("CMOs")	1,624,609		49,059		(1,539)		1,672,129		1,547,805		14,893		(5,027)		1,557,671
Other mortgage-backed securities ("MBSs")	695,218		20,159		(237)		715,140		678,804		7,728		(1,848)		684,684
Municipal securities	229,414		10,410		(21)		239,803		228,632		5,898		(99)		234,431
Corporate debt securities	143,639		2,367		(1,462)		144,544		112,797		1,791		(487)		114,101
Total securities available-for-sale	$	3,354,125	$	86,368	$	(4,631)	$	3,435,862	$	2,851,479	$	31,205	$	(9,298)	$	2,873,386
Securities Held-to-Maturity
Municipal securities	$	19,848	$	48	$	—	$	19,896	$	21,997	$	—	$	(763)	$	21,234
Allowance for securities held-to-   maturity(1)	(220)						$	(220)
Total securities held-to-maturity, net	$	19,628	$	48	$	—	$	19,676
Equity Securities							$	43,954							$	42,136

⁽¹⁾The allowance for securities held-to-maturity was established upon adoption of CECL on January 1, 2020.

Accrued interest receivable on the securities portfolio totaled $13.6 million and $11.3 million as of June 30, 2020 and December 31, 2019, respectively, and is included in accrued interest receivable and other assets in the Consolidated Statements of Financial Condition.

Accounting guidance requires that the credit portion of a decline in fair value be recognized as an allowance for credit losses, established as a charge to expense through income. If a decline in fair value below carrying value is not attributable to credit deterioration and the Company does not intend to sell the security or believe it would not be more likely than not required to sell the security prior to recovery, the Company records the non-credit related portion of the decline in fair value in other comprehensive income (loss). In determining whether a decline in fair value of a security is credit related, the Company considers adverse conditions specific to the security, deterioration in economic conditions or market environment that may affect the value of the securities and related collateral, if any, events of default, changes to the credit rating of the security by a rating agency, and guarantees applicable to the security, among other factors.

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Remaining Contractual Maturity of Securities

(Dollar amounts in thousands)

	As of June 30, 2020
	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	270,623	$	274,363	$	8,070	$	8,089
After one year to five years	185,159		187,718		5,452		5,465
After five years to ten years	578,516		586,512		3,315		3,323
After ten years	—		—		2,791		2,799
Securities that do not have a single contractual maturity date	2,319,827		2,387,269		—		—
Total	$	3,354,125	$	3,435,862	$	19,628	$	19,676

The carrying value of securities available-for-sale that were pledged to secure deposits or for other purposes as permitted or required by law totaled $1.5 billion as of June 30, 2020 and $1.3 billion as of December 31, 2019. No securities held-to-maturity were pledged as of June 30, 2020 or December 31, 2019.

There were realized losses of $1.0 million on securities available-for-sale for six months ended June 30, 2020 and no realized gains (losses) for the quarters ended June 30, 2020 and 2019 and six months ended June 30, 2019.

The following table presents the aggregate amount of unrealized losses and the aggregate related fair values of securities with unrealized losses as of June 30, 2020 and December 31, 2019.

Securities in an Unrealized Loss Position

(Dollar amounts in thousands)

		Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
As of June 30, 2020
Securities Available-for-Sale
U.S. agency securities	23	$	73,659	$	1,149	$	13,927	$	223	$	87,586	$	1,372
CMOs	41	139,578		1,379		33,967		160		173,545		1,539
MBSs	14	64,778		223		3,805		14		68,583		237
Municipal securities	1	1,745		21		—		—		1,745		21
Corporate debt securities	11	39,949		154		38,199		1,308		78,148		1,462
Total	90	$	319,709	$	2,926	$	89,898	$	1,705	$	409,607	$	4,631
As of December 31, 2019
Securities Available-for-Sale
U.S. treasury securities	5	$	4,966	$	1	$	—	$	—	$	4,966	$	1
U.S. agency securities	52	97,729		1,200		49,387		636		147,116		1,836
CMOs	148	187,470		2,177		412,083		2,850		599,553		5,027
MBSs	59	66,340		996		121,861		852		188,201		1,848
Municipal securities	16	9,384		89		3,104		10		12,488		99
Corporate debt securities	6	9,719		281		21,955		206		31,674		487
Total	286	$	375,608	$	4,744	$	608,390	$	4,554	$	983,998	$	9,298

Substantially all of the Company's CMOs and other MBSs are either backed by U.S. government-owned agencies or issued by U.S. government-sponsored enterprises. Municipal securities are issued by municipal authorities, and the majority are supported by third-party insurance or some other form of credit enhancement. Management does not believe any of these securities with unrealized losses as of June 30, 2020 represent impairment related to credit deterioration. These unrealized losses are attributed to changes in interest rates and temporary market movements. The Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis, which may be at maturity.

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5. LOANS

Loans Held-for-Investment

The following table presents the Company's loans held-for-investment by class.

Loan Portfolio

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Commercial and industrial	$	4,789,556	$	4,481,525
Agricultural	381,124		405,616
Commercial real estate:
Office, retail, and industrial	2,020,318		1,848,718
Multi-family	874,861		856,553
Construction	687,063		593,093
Other commercial real estate	1,475,937		1,383,708
Total commercial real estate	5,058,179		4,682,072
Total corporate loans, excluding Paycheck Protection Program ("PPP") loans	10,228,859		9,569,213
PPP loans	1,179,403		—
Total corporate loans	11,408,262		9,569,213
Home equity	892,867		851,454
1-4 family mortgages	2,175,322		1,927,078
Installment	457,207		492,585
Total consumer loans	3,525,396		3,271,117
Total loans	$	14,933,658	$	12,840,330
Deferred loan fees included in total loans	$	9,691	$	7,972
Overdrawn demand deposits included in total loans	7,676		10,675

Accrued interest receivable on the loan portfolio totaled $49.5 million and $48.4 million as of June 30, 2020 and December 31, 2019, respectively and is included in accrued interest receivable and other assets in the Consolidated Statements of Financial Condition.

The Company primarily lends to community-based and mid-sized businesses, commercial real estate customers, and consumers in its markets. Within these areas, the Company diversifies its loan portfolio by loan type, industry, and borrower.

It is the Company's policy to review each prospective credit to determine the appropriateness and the adequacy of security or collateral prior to making a loan. In the event of borrower default, the Company seeks recovery in compliance with state lending laws, the Company's lending standards, and credit monitoring and remediation procedures. A discussion of risk characteristics relevant to each portfolio segment is presented in Note 5, "Loans" to the Consolidated Financial Statements in the Company's 2019 10-K.

19

Loan Sales

The following table presents loan sales and purchases for the quarters and six months ended June 30, 2020 and 2019.

Loan Sales and Purchases

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Corporate loan sales
Proceeds from sales	$	295	$	2,178	$	4,598	$	5,376
Less book value of loans sold	289		2,132		4,477		5,248
Net gains on corporate loan sales(1)	6		46		121		128
1-4 family mortgage loan sales
Proceeds from sales	173,251		95,408		292,410		154,191
Less book value of loans sold	168,656		93,473		285,301		150,928
Net gains on 1-4 family mortgage loan sales(2)	4,595		1,935		7,109		3,263
Total net gains on loan sales	$	4,601	$	1,981	$	7,230	$	3,391
Corporate loan purchases(3)
Commercial and industrial	$	22,894	$	128,891	$	168,716	$	181,610
Office, retail, and industrial	—		1,711		—		1,711
Construction	3,258		1,432		3,897		2,266
Other commercial real estate	10,000		—		10,000		3,986
Total corporate loan purchases	$	36,152	$	132,034	$	182,613	$	189,573
Consumer loan purchases
Home equity	$	—	$	39,159	$	144,967	$	77,411
1-4 family mortgages	179,410		231,533		249,585		304,463
Total consumer loan purchases	$	179,410	$	270,692	$	394,552	$	381,874

⁽¹⁾Net gains on corporate loan sales are included in other service charges, commissions, and fees in the Condensed Consolidated Statements of Income.

⁽²⁾Net gains on 1-4 family mortgage loan sales are included in mortgage banking income in the Condensed Consolidated Statements of Income.

⁽³⁾Consists of the Company's portion of loan participations purchased.

The Company retained servicing responsibilities for a portion of the 1-4 family mortgage loans sold and collects servicing fees equal to a percentage of the outstanding principal balance. For additional disclosure related to the Company's obligations resulting from the sale of certain 1-4 family mortgage loans, see Note 13, "Commitments, Guarantees, and Contingent Liabilities."

6. ACQUIRED LOANS

The significant accounting policies related to acquired loans, which are classified as PCD and non-PCD at June 30, 2020, are presented in Note 1, "Summary of Significant Accounting Policies."

The following table presents the carrying amount of acquired loans as of June 30, 2020 and December 31, 2019.

Acquired Loans⁽¹⁾⁽²⁾

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	PCD		Non-PCD		Total		PCI		Non-PCI		Total
Acquired loans	$	243,207	$	1,516,157	$	1,759,364	$	167,183	$	1,216,133	$	1,383,316

⁽¹⁾Included in loans in the Consolidated Statements of Financial Condition.

⁽²⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

The outstanding balance of PCD loans was $284.3 million as of June 30, 2020 and the outstanding balance of PCI loans was $243.0 million as of December 31, 2019.

20

Total accretion on acquired loans for the quarters and six months ended June 30, 2020 and 2019 was $7.0 million and $13.9 million, respectively, and $10.3 million and $16.7 million for the same periods in 2019.

7. PAST DUE LOANS, ALLOWANCE FOR CREDIT LOSSES, NON-ACCRUAL LOANS, AND TDRS

Past Due and Non-accrual Loans

The following table presents an aging analysis of the Company's past due loans as of June 30, 2020 and December 31, 2019 with balances presented on an amortized cost basis. The aging is determined without regard to accrual status. The table also presents non-performing loans, consisting of non-accrual loans (the majority of which are past due) and loans 90 days or more past due and still accruing interest, as of each balance sheet date.

Aging Analysis of Past Due Loans and Non-performing Loans by Class⁽¹⁾

(Dollar amounts in thousands)

	Aging Analysis (Accruing and Non-accrual)										Non-performing Loans
	Current		30-89 Days Past Due		90 Days or More Past Due		Total Past Due		Total Loans		Non- accrual		90 Days or More Past Due, Still Accruing Interest
As of June 30, 2020
Commercial and industrial	$	4,750,932	$	20,550	$	18,074	$	38,624	$	4,789,556	$	28,349	$	1,090
Agricultural	373,910		—		7,214		7,214		381,124		8,494		—
Commercial real estate:
Office, retail, and industrial	1,982,798		4,973		32,547		37,520		2,020,318		35,915		596
Multi-family	870,430		1,538		2,893		4,431		874,861		3,121		—
Construction	658,892		801		27,370		28,171		687,063		27,282		88
Other commercial real estate	1,458,874		5,145		11,918		17,063		1,475,937		18,372		25
Total commercial real estate	4,970,994		12,457		74,728		87,185		5,058,179		84,690		709
Total corporate loans, excluding PPP loans	10,095,836		33,007		100,016		133,023		10,228,859		121,533		1,799
PPP loans	1,179,403		—		—		—		1,179,403		—		—
Total corporate loans	11,275,239		33,007		100,016		133,023		11,408,262		121,533		1,799
Home equity	885,678		2,641		4,548		7,189		892,867		9,129		187
1-4 family mortgages	2,164,611		4,928		5,783		10,711		2,175,322		8,498		—
Installment	454,996		956		1,255		2,211		457,207		—		1,255
Total consumer loans	3,505,285		8,525		11,586		20,111		3,525,396		17,627		1,442
Total loans	$	14,780,524	$	41,532	$	111,602	$	153,134	$	14,933,658	$	139,160	$	3,241
As of December 31, 2019
Commercial and industrial	$	4,455,381	$	11,468	$	14,676	$	26,144	$	4,481,525	$	29,995	$	2,207
Agricultural	398,676		850		6,090		6,940		405,616		5,954		358
Commercial real estate:
Office, retail, and industrial	1,830,321		2,943		15,454		18,397		1,848,718		25,857		546
Multi-family	853,762		211		2,580		2,791		856,553		2,697		—
Construction	588,065		4,876		152		5,028		593,093		152		—
Other commercial real estate	1,377,678		3,233		2,797		6,030		1,383,708		4,729		529
Total commercial real estate	4,649,826		11,263		20,983		32,246		4,682,072		33,435		1,075
Total corporate loans	9,503,883		23,581		41,749		65,330		9,569,213		69,384		3,640
Home equity	841,908		4,992		4,554		9,546		851,454		8,443		146
1-4 family mortgages	1,917,648		5,452		3,978		9,430		1,927,078		4,442		1,203
Installment	491,406		1,167		12		1,179		492,585		—		12
Total consumer loans	3,250,962		11,611		8,544		20,155		3,271,117		12,885		1,361
Total loans	$	12,754,845	$	35,192	$	50,293	$	85,485	$	12,840,330	$	82,269	$	5,001

⁽¹⁾ Prior to the adoption of CECL on January 1, 2020, purchased credit impaired ("PCI") loans with an accretable yield were considered current and were not included in past due loan totals. In addition, PCI loans with an accretable yield were excluded from non-accrual loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals. In addition, an allowance for credit losses is established as of the acquisition date or upon the adoption of CECL for loans previously classified as PCI, as PCD loans are no longer recorded net of a credit-related acquisition adjustment.

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Allowance for Credit Losses

The Company maintains an allowance for credit losses at a level deemed adequate by management to absorb estimated losses expected in the existing loan portfolio. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for the allowance for credit losses. A rollforward of the allowance for credit losses by portfolio segment for the quarters and six months ended June 30, 2020 and 2019 is presented in the table below. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)

	Commercial, Industrial, and Agricultural		Office, Retail, and Industrial		Multi- family		Construction		Other Commercial Real Estate		Consumer		Allowance for Unfunded Commitments		Total Allowance for Credit Losses
Quarter Ended June 30, 2020
Beginning balance	$	113,733	$	25,856	$	3,689	$	11,297	$	18,554	$	46,819	$	6,753	$	226,701
Allowance established for acquired PCD loans	378		—		—		—		—		—		872		1,250
Charge-offs	(5,673)		(3,092)		(9)		(798)		(31)		(4,631)		—		(14,234)
Recoveries	820		6		—		—		12		473		—		1,311
Net charge-offs	(4,853)		(3,086)		(9)		(798)		(19)		(4,158)		—		(12,923)
Provision for loan losses and other	14,719		1,671		1,631		1,023		3,327		10,278		—		32,649
Ending balance	$	123,977	$	24,441	$	5,311	$	11,522	$	21,862	$	52,939	$	7,625	$	247,677
Quarter Ended June 30, 2019
Beginning balance	$	64,685	$	7,679	$	2,216	$	2,131	$	4,930	$	21,938	$	1,200	$	104,779
Charge-offs	(6,516)		(1,605)		—		—		(329)		(2,974)		—		(11,424)
Recoveries	1,258		151		—		10		45		619		—		2,083
Net charge-offs	(5,258)		(1,454)		—		10		(284)		(2,355)		—		(9,341)
Provision for loan losses and other	6,937		1,270		(57)		(279)		351		3,269		—		11,491
Ending balance	$	66,364	$	7,495	$	2,159	$	1,862	$	4,997	$	22,852	$	1,200	$	106,929
Six Months Ended June 30, 2020
Beginning balance	$	62,830	$	7,580	$	2,950	$	1,697	$	6,408	$	26,557	$	1,200	$	109,222
Adjustment to apply   recent accounting   pronouncements(1)	20,159		11,686		397		10,300		11,427		16,235		5,553		75,757
Allowance established for acquired PCD loans	12,640		2,003		—		—		—		39		872		15,554
Charge-offs	(12,739)		(3,430)		(19)		(2,606)		(339)		(9,031)		—		(28,164)
Recoveries	1,979		15		5		—		156		972		—		3,127
Net charge-offs	(10,760)		(3,415)		(14)		(2,606)		(183)		(8,059)		—		(25,037)
Provision for loan   losses and other	39,108		6,587		1,978		2,131		4,210		18,167		—		72,181
Ending balance	$	123,977	$	24,441	$	5,311	$	11,522	$	21,862	$	52,939	$	7,625	$	247,677
Six Months Ended June 30, 2019
Beginning balance	$	63,276	$	7,900	$	2,464	$	2,173	$	4,934	$	21,472	$	1,200	$	103,419
Charge-offs	(12,967)		(2,233)		(340)		(6)		(539)		(6,116)		—		(22,201)
Recoveries	2,559		161		1		16		66		973		—		3,776
Net charge-offs	(10,408)		(2,072)		(339)		10		(473)		(5,143)		—		(18,425)
Provision for loan   losses and other	13,496		1,667		34		(321)		536		6,523		—		21,935
Ending balance	$	66,364	$	7,495	$	2,159	$	1,862	$	4,997	$	22,852	$	1,200	$	106,929

⁽¹⁾ As a result of accounting guidance adopted in the first quarter of 2020, the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

22

The allowance for credit losses increased from December 31, 2019 primarily due to the adoption of CECL and the estimated impact of the pandemic on the allowance for credit losses, which considers multiple macroeconomic scenarios of stressed GDP, unemployment, and housing price index, detailed portfolio reviews of elevated risk sectors, and the effects of governmental responses to the pandemic.

The table below provides a breakdown of loans and the related allowance for credit losses by portfolio segment as of June 30, 2020 and December 31, 2019.

Loans and Related Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)

	Loans								Allowance for Credit Losses
	Individually Evaluated		Collectively Evaluated		PCD/PCI(1)		Total		Individually Evaluated		Collectively Evaluated		PCD/PCI(1)		Total
As of June 30, 2020
Commercial, industrial,  agricultural	$	25,190	$	5,049,876	$	95,614	$	5,170,680	$	4,805	$	102,735	$	16,437	$	123,977
Commercial real estate:
Office, retail, and industrial	25,165		1,956,597		38,556		2,020,318		885		14,964		8,592		24,441
Multi-family	1,785		871,545		1,531		874,861		—		5,126		185		5,311
Construction	18,611		646,355		22,097		687,063		—		4,624		6,898		11,522
Other commercial real estate	3,806		1,410,080		62,051		1,475,937		44		10,332		11,486		21,862
Total commercial real estate	49,367		4,884,577		124,235		5,058,179		929		35,046		27,161		63,136
Total corporate loans, excluding PPP loans	74,557		9,934,453		219,849		10,228,859		5,734		137,781		43,598		187,113
PPP loans	—		1,179,403		—		1,179,403		—		—		—		—
Total corporate loans	74,557		11,113,856		219,849		11,408,262		5,734		137,781		43,598		187,113
Consumer	23		3,502,015		23,358		3,525,396		—		52,103		836		52,939
Allowance for unfunded commitments	—		—		—		—		—		7,625		—		7,625
Total loans	$	74,580	$	14,615,871	$	243,207	$	14,933,658	$	5,734	$	197,509	$	44,434	$	247,677
As of December 31, 2019
Commercial, industrial, and   agricultural	$	34,142	$	4,807,114	$	45,885	$	4,887,141	$	3,414	$	59,108	$	308	$	62,830
Commercial real estate:
Office, retail, and industrial	24,820		1,795,557		28,341		1,848,718		578		6,899		103		7,580
Multi-family	1,995		851,857		2,701		856,553		—		2,854		96		2,950
Construction	123		581,747		11,223		593,093		—		1,681		16		1,697
Other commercial real estate	3,241		1,323,635		56,832		1,383,708		—		4,867		1,541		6,408
Total commercial real estate	30,179		4,552,796		99,097		4,682,072		578		16,301		1,756		18,635
Total corporate loans	64,321		9,359,910		144,982		9,569,213		3,992		75,409		2,064		81,465
Consumer	—		3,248,916		22,201		3,271,117		—		25,424		1,133		26,557
Allowance for unfunded commitments	—		—		—		—		—		1,200		—		1,200
Total loans	$	64,321	$	12,608,826	$	167,183	$	12,840,330	$	3,992	$	102,033	$	3,197	$	109,222

⁽¹⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

23

The following table presents collateral-dependent loans, including PCD loans, without regard to accrual status by primary collateral type and non-accrual loans with no related allowance as of June 30, 2020. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Collateral-dependent Loans and Non-accrual Loans With No Related Allowance by Class

(Dollar amounts in thousands)

	Type of Collateral						Non-accrual Loans With No Related Allowance
	Real Estate		Blanket Lien		Equipment
Commercial and industrial	$	6,870	$	45,235	$	3,169	$	6,338
Agricultural	3,417		4,719		—		4,485
Commercial real estate:
Office, retail, and industrial	44,538		—		—		17,293
Multi-family	2,606		—		—		1,785
Construction	28,779		—		—		19,043
Other commercial real estate	33,845		—		—		11,789
Total commercial real estate	109,768		—		—		49,910
Total corporate loans	120,055		49,954		3,169		60,733
Home equity	244		—		—		123
1-4 family mortgages	2,665		—		—		527
Installment	—		—		—		—
Total consumer loans	2,909		—		—		650
Total loans	$	122,964	$	49,954	$	3,169	$	61,383

Loans Individually Evaluated

The following table presents loans individually evaluated by class of loan as of June 30, 2020 and December 31, 2019. PCD and PCI loans are excluded from this disclosure.

Loans Individually Evaluated by Class

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Recorded Investment In								Recorded Investment In
	Loans with No Specific Allowance		Loans with a Specific Allowance		Unpaid Principal Balance		Specific Allowance		Loans with No Specific Allowance		Loans with a Specific Allowance		Unpaid Principal Balance		Specific Allowance
Commercial and industrial	$	4,884	$	12,170	$	37,153	$	3,018	$	12,885	$	15,516	$	52,559	$	2,456
Agricultural	4,485		3,651		13,032		1,787		1,889		3,852		9,293		958
Commercial real estate:
Office, retail, and industrial	15,839		9,326		28,730		885		14,111		10,709		37,007		578
Multi-family	1,785		—		1,785		—		1,995		—		1,995		—
Construction	18,611		—		18,611		—		123		—		123		—
Other commercial real estate	3,357		449		4,103		44		3,241		—		3,495		—
Total commercial real estate	39,592		9,775		53,229		929		19,470		10,709		42,620		578
Total corporate loans	48,961		25,596		103,414		5,734		34,244		30,077		104,472		3,992
Consumer	23		—		23		—		—		—		—		—
Total non-accrual loans individually evaluated	$	48,984	$	25,596	$	103,437	$	5,734	$	34,244	$	30,077	$	104,472	$	3,992

Interest income recognized on non-accrual loans using the cash basis of accounting for the quarters ended and six months ended June 30, 2020 and 2019 was $110,000 and $388,000, respectively, and $69,000 and $148,000 for the same periods in 2019.

24

Credit Quality Indicators

Corporate loans and commitments are assessed for credit risk and assigned ratings based on various characteristics, such as the borrower's cash flow, leverage, and collateral. Ratings for commercial credits are reviewed at least annually or more often if events or circumstances arise that could impact the rating. The following tables present credit quality indicators for corporate and consumer loans on an amortized cost basis as of June 30, 2020 and net loan charge-offs for the six months ended June 30, 2020. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Corporate Loan Portfolio by Origination Year

(Dollar amounts in thousands)

	2020(1)		2019		2018		2017		2016		Prior		Revolving Loans		Total
Commercial, industrial, agricultural:
Pass	$	461,644	$	887,292	$	924,776	$	519,875	$	238,751	$	469,442	$	1,364,316	$	4,866,096
Special Mention(2)	3,508		6,520		31,435		4,676		8,527		17,568		80,597		152,831
Substandard(3)	384		4,376		26,729		17,862		16,583		15,804		33,172		114,910
Non-accrual(4)	—		1,771		2,381		8,505		4,806		6,682		12,698		36,843
Total commercial, industrial, agricultural	$	465,536	$	899,959	$	985,321	$	550,918	$	268,667	$	509,496	$	1,490,783	$	5,170,680
Commercial, industrial, agricultural, net loan charge-offs	$	—	$	250	$	946	$	1,058	$	617	$	1,853	$	6,036	$	10,760
Office, retail, and industrial:
Pass	$	95,291	$	266,479	$	225,938	$	348,121	$	302,430	$	677,880	$	5,491	$	1,921,630
Special Mention(2)	1,173		655		3,280		5,091		15,439		12,914		—		38,552
Substandard(3)	—		—		—		337		1,514		22,370		—		24,221
Non-accrual(4)	—		—		132		—		10,238		25,545		—		35,915
Total office, retail, and industrial	$	96,464	$	267,134	$	229,350	$	353,549	$	329,621	$	738,709	$	5,491	$	2,020,318
Office, retail, and industrial net loan charge-offs	$	—	$	333	$	156	$	—	$	1,628	$	1,298	$	—	$	3,415
Multi-family:
Pass	$	125,328	$	174,802	$	84,791	$	101,492	$	101,846	$	239,713	$	36,111	$	864,083
Special Mention(2)	—		—		—		—		358		1,416		—		1,774
Substandard(3)	—		—		387		81		—		5,415		—		5,883
Non-accrual(4)	—		—		—		1,785		237		1,099		—		3,121
Total multi-family	$	125,328	$	174,802	$	85,178	$	103,358	$	102,441	$	247,643	$	36,111	$	874,861
Multi-family net loan charge-offs	$	—	$	3	$	—	$	1	$	—	$	10	$	—	$	14
Construction:
Pass	$	33,890	$	151,849	$	171,480	$	101,781	$	71,001	$	70,950	$	33,016	$	633,967
Special Mention(2)	—		—		45		3,032		14,221		1,228		—		18,526
Substandard(3)	—		—		—		—		—		7,288		—		7,288
Non-accrual(4)	—		—		—		—		—		25,591		1,691		27,282
Total construction	$	33,890	$	151,849	$	171,525	$	104,813	$	85,222	$	105,057	$	34,707	$	687,063
Construction net loan charge-offs	$	—	$	118	$	—	$	798	$	—	$	1,690	$	—	$	2,606
Other commercial real estate:
Pass	$	61,056	$	195,768	$	269,526	$	226,064	$	125,249	$	466,436	$	27,553	$	1,371,652
Special Mention(2)	—		3,532		7,589		6,887		11,219		15,463		—		44,690
Substandard(3)	—		—		—		1,400		4,224		35,599		—		41,223
Non-accrual(4)	—		—		674		4,150		1,078		12,377		93		18,372
Total other commercial real estate	$	61,056	$	199,300	$	277,789	$	238,501	$	141,770	$	529,875	$	27,646	$	1,475,937
Other commercial real estate net loan charge- offs	$	—	$	38	$	1	$	—	$	183	$	(39)	$	—	$	183

⁽¹⁾Represents year-to-date loans originated during 2020.

⁽²⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽³⁾Loans categorized as substandard exhibit well-defined weaknesses that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured, and collection of principal and interest is expected within a reasonable time.

⁽⁴⁾Loans categorized as non-accrual exhibit well-defined weaknesses that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.

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Consumer Loan Portfolio by Origination Year

(Dollar amounts in thousands)

	2020(1)		2019		2018		2017		2016		Prior		Revolving Loans		Total
Home equity:
Performing	$	8,231	$	48,696	$	27,783	$	13,809	$	11,878	$	57,053	$	716,288	$	883,738
Non-accrual	—		22		125		264		482		6,801		1,435		9,129
Total home equity	$	8,231	$	48,718	$	27,908	$	14,073	$	12,360	$	63,854	$	717,723	$	892,867
Home equity net loan charge-offs	$	—	$	—	$	1	$	—	$	1	$	42	$	(14)	$	30
1-4 family mortgages:
Performing	$	597,506	$	676,898	$	311,884	$	158,230	$	181,912	$	240,394	$	—	$	2,166,824
Non-accrual	—		—		438		83		63		7,914		—		8,498
Total 1-4 family mortgages	$	597,506	$	676,898	$	312,322	$	158,313	$	181,975	$	248,308	$	—	$	2,175,322
1-4 family mortgages net loan charge-offs	$	—	$	—	$	4	$	—	$	7	$	735	$	—	$	746
Installment:
Performing	$	59,971	$	185,919	$	107,220	$	45,108	$	17,563	$	20,662	$	20,764	$	457,207
Non-accrual	—		—		—		—		—		—		—		—
Total installment	$	59,971	$	185,919	$	107,220	$	45,108	$	17,563	$	20,662	$	20,764	$	457,207
Installment net loan charge-offs	$	44	$	3,757	$	2,200	$	775	$	85	$	393	$	29	$	7,283

⁽¹⁾Represents year-to-date loans originated during 2020.

During the quarter and six months ended June 30, 2020, $16.8 million and $23.8 million, respectively, of revolving loans converted to term loans.

The following tables present credit quality indicators by class for corporate and consumer loans on an amortized cost basis as of December 31, 2019.

Corporate Credit Quality Indicators by Class

(Dollar amounts in thousands)

	Pass		Special Mention(1)		Substandard(2)		Non-accrual(3)		Total
As of December 31, 2019
Commercial and industrial	$	4,324,709	$	47,665	$	79,156	$	29,995	$	4,481,525
Agricultural	350,827		32,764		16,071		5,954		405,616
Commercial real estate:
Office, retail, and industrial	1,747,287		42,230		33,344		25,857		1,848,718
Multi-family	839,615		8,279		5,962		2,697		856,553
Construction	564,495		17,977		10,469		152		593,093
Other commercial real estate	1,295,155		39,788		44,036		4,729		1,383,708
Total commercial real estate	4,446,552		108,274		93,811		33,435		4,682,072
Total corporate loans	$	9,122,088	$	188,703	$	189,038	$	69,384	$	9,569,213

⁽¹⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽²⁾Loans categorized as substandard exhibit a well-defined weakness that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured and collection of principal and interest is expected within a reasonable time.

⁽³⁾Loans categorized as non-accrual exhibit a well-defined weakness that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.

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Consumer Credit Quality Indicators by Class

(Dollar amounts in thousands)

	Performing		Non-accrual		Total
As of December 31, 2019
Home equity	$	843,011	$	8,443	$	851,454
1-4 family mortgages	1,922,636		4,442		1,927,078
Installment	492,585		—		492,585
Total consumer loans	$	3,258,232	$	12,885	$	3,271,117

TDRs

TDRs are generally performed at the request of the individual borrower and may include forgiveness of principal, reduction in interest rates, changes in payments, and maturity date extensions. The table below presents TDRs by class as of June 30, 2020 and December 31, 2019. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for TDRs.

TDRs by Class

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Accruing		Non-accrual(1)		Total		Accruing		Non-accrual(1)		Total
Commercial and industrial	$	188	$	9,336	$	9,524	$	227	$	16,420	$	16,647
Agricultural	—		—		—		—		—		—
Commercial real estate:
Office, retail, and industrial	—		2,340		2,340		—		3,600		3,600
Multi-family	160		—		160		163		—		163
Construction	—		—		—		—		—		—
Other commercial real estate	198		—		198		170		—		170
Total commercial real estate	358		2,340		2,698		333		3,600		3,933
Total corporate loans	546		11,676		12,222		560		20,020		20,580
Home equity	31		179		210		36		240		276
1-4 family mortgages	624		238		862		637		—		637
Installment	—		—		—		—		254		254
Total consumer loans	655		417		1,072		673		494		1,167
Total loans	$	1,201	$	12,093	$	13,294	$	1,233	$	20,514	$	21,747

⁽¹⁾These TDRs are included in non-accrual loans in the preceding tables.

TDRs are included in the calculation of the allowance for credit losses in the same manner as non-accrual loans. As of June 30, 2020 and December 31, 2019, there were $2.4 million and $2.2 million of specific allowances, respectively, related to TDRs.

There were no material restructurings during the quarters and six months ended June 30, 2020 and 2019.

Accruing TDRs that do not perform in accordance with their modified terms are transferred to non-accrual. There were no material TDRs that defaulted within twelve months of the restructure date during the quarters and six months ended June 30, 2020 and 2019.

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A rollforward of the carrying value of TDRs for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

TDR Rollforward

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Accruing
Beginning balance	$	1,216	$	1,844	$	1,233	$	1,866
Additions	—		—		—		12
Net payments	(15)		(20)		(32)		(54)
Net transfers to non-accrual	—		(383)		—		(383)
Ending balance	1,201		1,441		1,201		1,441
Non-accrual
Beginning balance	17,917		9,375		20,514		6,612
Additions	—		—		934		—
Net (payments) advances	(2,595)		(1,447)		(3,253)		1,474
Charge-offs	(3,229)		(470)		(6,102)		(628)
Net transfers from accruing	—		383		—		383
Ending balance	12,093		7,841		12,093		7,841
Total TDRs	$	13,294	$	9,282	$	13,294	$	9,282

There were $813,000 and $530,000 of commitments to lend additional funds to borrowers with TDRs as of June 30, 2020 and December 31, 2019, respectively.

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8. LEASE OBLIGATIONS

The Company has the right to utilize certain premises under non-cancelable operating leases with varying maturity dates through the year ending December 31, 2059. As of June 30, 2020, the weighted-average remaining lease term on these leases was 10.70 years. Various leases contain renewal or termination options controlled by the Company or options to purchase the leased property during or at the expiration of the lease period at specific prices. Some leases contain escalation clauses calling for rentals to be adjusted for increased real estate taxes and other operating expenses or proportionately adjusted for increases in consumer or other price indices. Variable payments for real estate taxes and other operating expenses are considered to be non-lease components and are excluded from the determination of the lease liability. In addition, the Company leases or subleases certain real estate to third-parties. The following summary reflects the future minimum payments by year required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year and a reconciliation of those payments to the Company's lease liability as of June 30, 2020.

Lease Liability

(Dollar amounts in thousands)

	As of    June 30, 2020
Year Ending December 31,
2020	$	9,466
2021	18,785
2022	18,711
2023	18,811
2024	18,530
2025 and thereafter	105,995
Total minimum lease payments	190,298
Discount(1)	(28,752)
Lease liability(2)	$	161,546

⁽¹⁾Represents the net present value adjustment related to minimum lease payments.

⁽²⁾Included in accrued interest payable and other liabilities in the Consolidated Statements of Financial Condition.

The discount rate for the Company's operating leases is the rate implicit in the lease and, if that rate cannot be readily determined, the Company's incremental borrowing rate. The weighted-average discount rate on the Company's operating leases was 2.96% as of June 30, 2020.

As of June 30, 2020, right-of-use assets of $141.2 million associated with lease liabilities were included in accrued interest receivable and other assets in the Consolidated Statements of Financial Condition.

The following table presents net operating lease expense for the quarters and six months ended June 30, 2020 and 2019.

Net Operating Lease Expense

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Lease expense charged to operations	$	4,839	$	4,426	$	9,514	$	8,486
Rental income from premises leased to others (1)	(183)		(165)		(398)		(322)
Net operating lease expense	$	4,656	$	4,261	$	9,116	$	8,164

⁽¹⁾Included as reductions to net occupancy and equipment expense in the Condensed Consolidated Statements of Income.

During 2016, the Bank completed a sale-leaseback transaction, whereby the Bank sold to a third-party 55 branches and concurrently entered into triple net lease agreements with certain affiliates of the third-party for each of the branches sold. The sale-leaseback transaction resulted in a pre-tax gain of $88.0 million, net of transaction related expenses, of which $5.5 million was immediately recognized in earnings. Remaining deferred pre-tax gains were $65.5 million as of December 31, 2018. Upon adoption of new lease guidance on January 1, 2019, the remaining after-tax gain of $47.3 million was recognized as a cumulative-effect adjustment to equity in the Consolidated Statements of Financial Condition.

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9.  BORROWED FUNDS

The following table summarizes the Company's borrowed funds by funding source.

Summary of Borrowed Funds

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Securities sold under agreements to repurchase	$	130,667	$	103,515
Federal funds purchased	200,000		160,000
FHLB advances	1,974,528		1,395,243
Total borrowed funds	$	2,305,195	$	1,658,758

Securities sold under agreements to repurchase are treated as financings and the obligations to repurchase securities sold are included as a liability in the Consolidated Statements of Financial Condition. Repurchase agreements are secured by U.S. treasury and agency securities which are held in third-party pledge accounts if required. The securities underlying the agreements remain in the respective asset accounts. As of June 30, 2020, the Company did not have amounts at risk under repurchase agreements with any individual counterparty or group of counterparties that exceeded 10% of stockholders' equity.

The Bank is a member of the FHLB and has access to term financing from the FHLB. These advances are secured by designated assets that may include qualifying commercial real estate, residential and multi-family mortgages, home equity loans, and certain municipal and mortgage-backed securities. As of June 30, 2020, the Company held various short-term FHLB advances with fixed interest rates that range from 0.00% to 1.97% and maturity dates that range from July 1, 2020 to March 4, 2030.

The Company hedges interest rates on borrowed funds using interest rate swaps through which the Company receives variable amounts and pays fixed amounts. See Note 12 "Derivative Instruments and Hedging Activities" for a detailed discussion of interest rate swaps.

The following table presents short-term credit lines available for use, for which the Company did not have an outstanding balance as of June 30, 2020 and December 31, 2019.

Short-Term Credit Lines Available for Use

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
FRB's Discount Window Primary Credit Program	$	803,068	$	874,256
Available federal funds lines	814,000		718,000
Correspondent bank line of credit	50,000		50,000

On September 27, 2016, the Company entered into a loan agreement with U.S. Bank National Association providing for a $50.0 million short-term, unsecured revolving credit facility. On September 26, 2019, the Company entered into a third amendment to this credit facility, which extends the maturity to September 26, 2020. Advances will bear interest at a rate equal to one-month LIBOR plus 1.75%, adjusted on a monthly basis, and the Company must pay an unused facility fee equal to 0.35% per annum on a quarterly basis. Management expects to use this line of credit for general corporate purposes. As of June 30, 2020, no amount was outstanding under the facility.

A discussion of terms relevant to senior and subordinated debt is presented in Note 13, "Senior and Subordinated Debt" to the Consolidated Financial Statements in the Company's 2019 10-K.

10. MATERIAL TRANSACTIONS AFFECTING STOCKHOLDERS' EQUITY

Issuance of Common Stock

On March 9, 2020, the Company issued 4.9 million shares of its common stock with a market value of $14.58 per share at issuance as part of the consideration in the Park Bank acquisition. Additional information regarding the Park Bank acquisition is presented in Note 3, "Acquisitions".

30

Issuance of Preferred Stock

During the second quarter of 2020, the Company issued 4.3 million depositary shares, each representing a 1/40th interest in a share of the Company's 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, and 4.9 million depositary shares, each representing a 1/40th interest in a share of the Company's Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, for an aggregate of $230.5 million. The Company received proceeds of $221.3 million, net of underwriting discounts and commissions and issuance costs and expects to use the proceeds for general corporate purposes.

Stock Repurchases

On March 19, 2019, the Company announced a stock repurchase program that authorized the Company to repurchase up to $180 million of its common stock from time to time on the open market or in privately negotiated transactions, at the discretion of the Company. 

On February 26, 2020, the Company announced a new stock repurchase program authorizing the discretionary repurchase of up to $200 million of its outstanding common stock through December 31, 2021. This program replaced the Company's prior $180 million stock repurchase program, which was set to expire in March 2020. The Company suspended repurchases in March as it shifted its capital deployment strategy in response to the pandemic. Prior to the suspension, the Company had repurchased 1.2 million shares of its common stock at a total cost of $22.6 million during the six months ended June 30, 2020.

11. EARNINGS PER COMMON SHARE

The table below displays the calculation of basic and diluted earnings per common share ("EPS").

Basic and Diluted EPS

(Amounts in thousands, except per share data)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Net income	$	19,064	$	47,014	$	38,670	$	93,072
Preferred dividends	(1,037)		—		(1,037)		—
Net income applicable to unvested restricted shares	(187)		(389)		(379)		(792)
Net income applicable to common shares	$	17,840	$	46,625	$	37,254	$	92,280
Weighted-average common shares outstanding:
Weighted-average common shares outstanding (basic)	113,145		108,467		111,533		107,126
Dilutive effect of common stock equivalents	191		—		339		—
Weighted-average diluted common shares outstanding	113,336		108,467		111,872		107,126
Basic EPS	$	0.16	$	0.43	$	0.33	$	0.86
Diluted EPS	$	0.16	$	0.43	$	0.33	$	0.86

12. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

In the ordinary course of business, the Company enters into derivative transactions as part of its overall interest rate risk management strategy. The significant accounting policies related to derivative instruments and hedging activities are presented in Note 1, "Summary of Significant Accounting Policies."

Cash Flow Hedges

As of June 30, 2020, the Company hedged $430.0 million of certain corporate variable rate loans using interest rate swaps through which the Company receives fixed amounts and pays variable amounts. The Company also hedged $1.6 billion of borrowed funds using interest rate swaps through which the Company receives variable amounts and pays fixed amounts. These transactions allow the Company to add stability to net interest income and manage its exposure to interest rate movements.

Interest rate swaps totaling $1.1 billion began on various dates between December of 2018 and April of 2020 and mature between October of 2021 and March of 2025. The remaining forward starting interest rate swaps totaling $485.0 million begin at various dates between July of 2020 and February of 2021 and mature between July of 2022 and August of 2024. The weighted-average fixed interest rate to be paid on these interest rate swaps that have not yet begun was 1.86% as of June 30, 2020. These derivative contracts are designated as cash flow hedges.

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Cash Flow Hedges

(Dollar amounts in thousands)

	As of
	June 30, 2020			December 31, 2019
Gross notional amount outstanding	$	2,035,000		$	1,905,000
Derivative asset fair value in other assets(1)	6,053			727
Derivative liability fair value in other liabilities(1)	198			(119)
Weighted-average interest rate received	0.96		%	1.88		%
Weighted-average interest rate paid	0.77		%	1.74		%
Weighted-average maturity (in years)	2.30			1.18

⁽¹⁾Certain cash flow hedges are transacted through a clearinghouse ("centrally cleared") and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

Changes in the fair value of cash flow hedges are recorded in accumulated other comprehensive income (loss) on an after-tax basis and are subsequently reclassified to interest income or expense in the period that the forecasted hedged item impacts earnings. As of June 30, 2020, the Company estimates that $4.3 million will be reclassified from accumulated other comprehensive income (loss) as a decrease to interest income over the next twelve months.

Other Derivative Instruments

The Company also enters into derivative transactions through capital market products with its commercial customers and simultaneously enters into an offsetting interest rate derivative transaction with third-parties. This transaction allows the Company's customers to effectively convert a variable rate loan into a fixed rate loan. Due to the offsetting nature of these transactions, the Company does not apply hedge accounting treatment. The Company's credit exposure on these derivative transactions results primarily from counterparty credit risk. The credit valuation adjustment ("CVA") is a fair value adjustment to the derivative to account for this risk. As of June 30, 2020 and December 31, 2019, the Company's credit exposure was fully secured by the underlying collateral on customer loans and mitigated through netting arrangements with third-parties; therefore, no CVA was recorded. Capital market products income related to commercial customer derivative instruments totaled $694,000 and $5.4 million for the quarter and six months ended June 30, 2020, respectively, and were $2.2 million and $3.4 million for the quarter and six months ended June 30, 2019, respectively.

Other Derivative Instruments

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Gross notional amount outstanding	$	4,589,018	$	4,340,384
Derivative asset fair value in other assets(1)	183,938		61,709
Derivative liability fair value in other liabilities(1)	(55,026)		(18,416)
Fair value of derivative(2)	56,025		18,856

⁽¹⁾Certain other derivative instruments are centrally cleared and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

⁽²⁾This amount represents the fair value if credit risk related contingent features were triggered.

The Company occasionally enters into risk participation agreements with counterparty banks to transfer or assume a portion of the credit risk related to customer transactions. The amounts of these instruments were not material for any periods presented. The Company had no other derivative instruments as of June 30, 2020 and December 31, 2019. The Company does not enter into derivative transactions for purely speculative purposes.

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The following table presents the impact of derivative instruments on comprehensive income (loss) and the reclassification of gains (losses) from accumulated other comprehensive income (loss) to net interest income for the quarters and six months ended June 30, 2020 and 2019.

Cash Flow Hedge Accounting on AOCI

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Gains (losses) recognized in other comprehensive income
Interest rate swaps in interest income	$	5,951	$	5,944	$	27,955	$	9,297
Interest rate swaps in interest expense	(1,276)		(7,816)		(13,685)		(11,996)
Reclassification of gains (losses) included in net income
Interest rate swaps in interest income	$	2,624	$	1,355	$	3,069	$	2,748
Interest rate swaps in interest expense	—		(1,924)		—		(3,948)

The following table presents the impact of derivative instruments on net interest income for the quarters and six months ended June 30, 2020 and 2019.

Hedge Income

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Cash Flow Hedges
Interest rate swaps in interest income	$	2,624	$	1,355	$	3,069	$	2,748
Interest rate swaps in interest expense	—		(1,924)		—		(3,948)
Total cash flow hedges	$	2,624	$	(569)	$	3,069	$	(1,200)

Credit Risk

Derivative instruments are inherently subject to credit risk, which represents the Company's risk of loss when the counterparty to a derivative contract fails to perform according to the terms of the agreement. Credit risk is managed by limiting and collateralizing the aggregate amount of net unrealized losses by transaction, monitoring the size and the maturity structure of the derivatives, and applying uniform credit standards. Company policy establishes limits on credit exposure to any single counterparty. In addition, the Company established bilateral collateral agreements with derivative counterparties that provide for exchanges of marketable securities or cash to collateralize either party's net losses above a stated minimum threshold. As of June 30, 2020 and December 31, 2019, these collateral agreements covered 100% of the fair value of the Company's outstanding derivatives. Derivative assets and liabilities are presented gross, rather than net, of pledged collateral amounts.

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Certain derivative instruments are subject to master netting agreements with counterparties. The Company records these transactions at their gross fair values and does not offset derivative assets and liabilities in the Consolidated Statements of Financial Condition. The following table presents the fair value of the Company's derivatives and offsetting positions as of June 30, 2020 and December 31, 2019.

Fair Value of Offsetting Derivatives

(Dollar amounts in thousands)

	As of June 30, 2020				As of December 31, 2019
	Assets		Liabilities		Assets		Liabilities
Gross amounts recognized	$	189,991	$	54,828	$	62,436	$	18,535
Less: amounts offset in the Consolidated Statements of Financial Condition	—		—		—		—
Net amount presented in the Consolidated Statements of   Financial Condition(1)	189,991		54,828		62,436		18,535
Gross amounts not offset in the Consolidated Statements of Financial Condition:
Offsetting derivative positions	(7,495)		(7,495)		(2,674)		(2,674)
Cash collateral pledged	—		(48,430)		—		(15,861)
Net credit exposure	$	182,496	$	(1,097)	$	59,762	$	—

⁽¹⁾Included in other assets or other liabilities in the Consolidated Statements of Financial Condition.

As of June 30, 2020 and December 31, 2019, the Company's derivative instruments generally contained provisions that require the Company's debt to remain above a certain credit rating by each of the major credit rating agencies or that the Company maintain certain capital levels. If the Company's debt were to fall below that credit rating or the Company's capital were to fall below the required levels, it would be in violation of those provisions, and the counterparties to the derivative instruments could terminate the swap transaction and demand cash settlement of the derivative instrument in an amount equal to the derivative liability fair value. As of June 30, 2020 and December 31, 2019 the Company was in compliance with these provisions.

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13. COMMITMENTS, GUARANTEES, AND CONTINGENT LIABILITIES

Credit Commitments and Guarantees

In the normal course of business, the Company enters into a variety of financial instruments with off-balance sheet risk to meet the financing needs of its customers and to conduct lending activities, including commitments to extend credit as well as standby and commercial letters of credit. These instruments involve elements of credit and interest rate risk in excess of the amount recognized in the Consolidated Statements of Financial Condition.

Contractual or Notional Amounts of Financial Instruments

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Commitments to extend credit:
Commercial, industrial, and agricultural	$	2,276,196	$	1,852,040
Commercial real estate	324,659		296,053
Home equity	578,920		576,956
Other commitments(1)	251,716		251,093
Total commitments to extend credit	$	3,431,491	$	2,976,142
Letters of credit	$	100,827	$	103,684

⁽¹⁾Other commitments includes installment and overdraft protection program commitments.

Commitments to extend credit are agreements to lend funds to a customer, subject to contractual terms and covenants. Commitments generally have fixed expiration dates or other termination clauses, variable interest rates, and fee requirements, when applicable. Since many of the commitments are expected to expire without being drawn, the total commitment amounts do not necessarily represent future cash flow requirements.

In the event of a customer's non-performance, the Company's credit loss exposure is equal to the contractual amount of the commitments. The credit risk is essentially the same as extending loans to customers for the full contractual amount. The Company uses the same credit policies for credit commitments as its loans and minimizes exposure to credit loss through various collateral requirements.

Letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third-party. Letters of credit generally are contingent on the failure of the customer to perform according to the terms of the contract with the third-party and are often issued in favor of a municipality where construction is taking place to ensure the borrower adequately completes the construction. Commercial letters of credit are issued to facilitate transactions between a customer and a third-party based on agreed upon terms.

The maximum potential future payments guaranteed by the Company under letters of credit arrangements are equal to the contractual amount of the commitment. If a commitment is funded, the Company may seek recourse through the liquidation of the underlying collateral, including real estate, production plants and property, marketable securities, or receipt of cash.

As a result of the sale of certain 1-4 family mortgage loans, the Company is contractually obligated to repurchase early payment default loans or loans that do not meet underwriting requirements at recorded value. In accordance with the sales agreements, there is no limitation to the maximum potential future payments or expiration of the Company's recourse obligation. There were no material loan repurchases during the quarters and six months ended June 30, 2020 and 2019.

Legal Proceedings

In the ordinary course of business, there were certain legal proceedings pending against the Company and its subsidiaries at June 30, 2020. While the outcome of any legal proceeding is inherently uncertain, based on information currently available, the Company's management does not expect that any liabilities arising from pending legal matters will have a material adverse effect on the Company's business, financial position, or results of operations.

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14. FAIR VALUE

Fair value represents the amount expected to be received to sell an asset or paid to transfer a liability in its principal or most advantageous market in an orderly transaction between market participants at the measurement date. In accordance with fair value accounting guidance, the Company measures, records, and reports various types of assets and liabilities at fair value on either a recurring or non-recurring basis in the Consolidated Statements of Financial Condition. Those assets and liabilities are presented below in the sections titled "Assets and Liabilities Required to be Measured at Fair Value on a Recurring Basis" and "Assets and Liabilities Required to be Measured at Fair Value on a Non-Recurring Basis."

Other assets and liabilities are not required to be measured at fair value in the Consolidated Statements of Financial Condition, but must be disclosed at fair value. See the "Fair Value Measurements of Other Financial Instruments" section of this note. Any aggregation of the estimated fair values presented in this note does not represent the value of the Company.

Depending on the nature of the asset or liability, the Company uses various valuation methodologies and assumptions to estimate fair value. GAAP provides a three-tiered fair value hierarchy based on the inputs used to measure fair value. The hierarchy is defined as follows:

•Level 1 – Quoted prices in active markets for identical assets or liabilities.

•Level 2 – Observable inputs other than level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

•Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These inputs require significant management judgment or estimation, some of which use model-based techniques and may be internally developed.

Assets and liabilities are assigned to a level within the fair value hierarchy based on the lowest level of significant input used to measure fair value. Assets and liabilities may change levels within the fair value hierarchy due to market conditions or other circumstances. Those transfers are recognized on the date of the event that prompted the transfer. There were no transfers of assets or liabilities required to be measured at fair value on a recurring basis between levels of the fair value hierarchy during the periods presented.

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Assets and Liabilities Required to be Measured at Fair Value on a Recurring Basis

The following table provides the fair value for assets and liabilities required to be measured at fair value on a recurring basis in the Consolidated Statements of Financial Condition by level in the fair value hierarchy.

Recurring Fair Value Measurements

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Equity securities	$	24,075	$	14,879	$	—	$	23,703	$	13,400	$	—
Securities available-for-sale
U.S. treasury securities	21,199		—		—		34,075		—		—
U.S. agency securities	—		643,047		—		—		248,424		—
CMOs	—		1,672,129		—		—		1,557,671		—
MBSs	—		715,140		—		—		684,684		—
Municipal securities	—		239,803		—		—		234,431		—
Corporate debt securities	—		144,544		—		—		114,101		—
Total securities available-for-sale	21,199		3,414,663		—		34,075		2,839,311		—
Mortgage servicing rights ("MSRs")(1)	—		—		4,464		—		—		5,858
Derivative assets(1)	—		189,991		—		—		62,436		—
Liabilities
Derivative liabilities(2)	$	—	$	54,828	$	—	$	—	$	18,535	$	—

⁽¹⁾Included in other assets in the Consolidated Statements of Financial Condition.

⁽²⁾Included in other liabilities in the Consolidated Statements of Financial Condition.

The following sections describe the specific valuation techniques and inputs used to measure financial assets and liabilities at fair value.

Equity Securities

The Company's equity securities consist primarily of community development investments and certain diversified investment securities held in a grantor trust for participants in the Company's nonqualified deferred compensation plan that are invested in money market and mutual funds. The fair value of certain community development investments is based on quoted prices in active markets or market prices for similar securities obtained from external pricing services or dealer market participants and is classified in level 2 of the fair value hierarchy. As of June 30, 2020, the fair value of certain community development investments totaling $5.0 million was based on the net asset value per share ("NAV") practical expedient and can be redeemed at any month end with 30 days notice. Since these investments are measured at fair value using the NAV practical expedient, they are not classified in the fair value hierarchy. The fair value of the money market and mutual funds is based on quoted market prices in active exchange markets and is classified in level 1 of the fair value hierarchy.

Securities Available-for-Sale

The Company's securities available-for-sale are primarily fixed income instruments that are not quoted on an exchange but may be traded in active markets. The fair values for these securities are based on quoted prices in active markets or market prices for similar securities obtained from external pricing services or dealer market participants and are classified in level 2 of the fair value hierarchy. The fair value of U.S. treasury securities is based on quoted market prices in active exchange markets and is classified in level 1 of the fair value hierarchy. Quarterly, the Company evaluates the methodologies used by its external pricing services to estimate the fair value of these securities in order to determine whether the valuations represent an exit price in the Company's principal markets.

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MSRs

The Company services loans for others totaling $675.6 million and $653.7 million as of June 30, 2020 and December 31, 2019, respectively. These loans are owned by third-parties and are not included in the Consolidated Statements of Financial Condition. The Company determines the fair value of MSRs by estimating the present value of expected future cash flows associated with the mortgage loans being serviced and classifies them in level 3 of the fair value hierarchy. The following table presents the ranges of significant, unobservable inputs used by the Company to determine the fair value of MSRs as of June 30, 2020 and December 31, 2019.

Significant Unobservable Inputs Used in the Valuation of MSRs

	As of
	June 30, 2020				December 31, 2019
Prepayment speed	7.6	%	-	14.9%	6.7	%	-	12.0%
Maturity (months)	16		-	88	18		-	94
Discount rate	9.4	%	-	12.0%	9.3	%	-	12.0%

The impact of changes in these key inputs could result in a significantly higher or lower fair value measurement for MSRs. Significant increases in expected prepayment speeds and discount rates have negative impacts on the valuation. Higher maturity assumptions have a favorable effect on the estimated fair value.

A rollforward of the carrying value of MSRs for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

Carrying Value of MSRs

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Beginning balance	$	4,874	$	6,228	$	5,858	$	6,730
New MSRs	745		204		901		457
Total gains (losses) included in earnings(1):
Changes in valuation inputs and assumptions	(750)		(389)		(1,658)		(989)
Other changes in fair value(2)	(405)		(212)		(637)		(367)
Ending balance(3)	$	4,464	$	5,831	$	4,464	$	5,831
Contractual servicing fees earned(1)	$	394	$	390	$	797	$	771

⁽¹⁾Included in mortgage banking income in the Condensed Consolidated Statements of Income and related to assets held as of June 30, 2020 and 2019.

⁽²⁾Primarily represents changes in expected future cash flows due to payoffs and paydowns.

⁽³⁾Included in other assets in the Consolidated Statements of Financial Condition.

Derivative Assets and Derivative Liabilities

The Company enters into interest rate swaps and derivative transactions with commercial customers. These derivative transactions are executed in the dealer market, and pricing is based on market quotes obtained from the counterparties. The market quotes were developed using market observable inputs, which primarily include LIBOR. Therefore, derivatives are classified in level 2 of the fair value hierarchy. For its derivative assets and liabilities, the Company also considers non-performance risk, including the likelihood of default by itself and its counterparties, when evaluating whether the market quotes from the counterparty are representative of an exit price.

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Assets and Liabilities Required to be Measured at Fair Value on a Non-Recurring Basis

The following table provides the fair value for each class of assets and liabilities required to be measured at fair value on a non-recurring basis in the Consolidated Statements of Financial Condition by level in the fair value hierarchy.

Non-Recurring Fair Value Measurements

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Collateral-dependent non-accrual loans(1)	$	—	$	—	$	53,608	$	—	$	—	$	41,326
OREO(2)	—		—		530		—		—		3,325
Loans held-for-sale(3)	—		—		45,466		—		—		36,032
Assets held-for-sale(4)	—		—		5,180		—		—		6,824

⁽¹⁾Includes non-accrual loans with charge-offs and non-accrual loans with a specific allowance during the periods presented.

⁽²⁾Includes OREO with fair value adjustments subsequent to initial transfer that occurred during the periods presented.

⁽³⁾Included in other assets in the Consolidated Statements of Financial Condition.

⁽⁴⁾Included in premises, furniture, and equipment in the Consolidated Statements of Financial Condition.

Collateral-Dependent Non-accrual Loans

Certain collateral-dependent non-accrual loans are subject to fair value adjustments to reflect the difference between the carrying value of the loan and the fair value of the underlying collateral. The fair values of collateral-dependent non-accrual loans are primarily determined by current appraised values of the underlying collateral. Based on the age and/or type, appraisals may be adjusted in the range of 0% to 15%. In certain cases, an internal valuation may be used when the underlying collateral is located in areas where comparable sales data is limited or unavailable. Accordingly, collateral-dependent non-accrual loans are classified in level 3 of the fair value hierarchy.

Collateral-dependent non-accrual loans for which the fair value is greater than the recorded investment are not measured at fair value in the Consolidated Statements of Financial Condition and are not included in this disclosure.

OREO

The fair value of OREO is measured using the current appraised value of the properties. In certain circumstances, a current appraisal may not be available or may not represent an accurate measurement of the property's fair value due to outdated market information or other factors. In these cases, the fair value is determined based on the lower of the (i) most recent appraised value, (ii) broker price opinion, (iii) current listing price, or (iv) signed sales contract, all less estimated costs to sell. Given these valuation methods, OREO is classified in level 3 of the fair value hierarchy.

Loans Held-for-Sale

As of June 30, 2020 and December 31, 2019, loans held-for-sale consists of 1-4 family mortgage loans, which were originated with the intent to sell. These loans were recorded in the held-for-sale category at the contract price and, accordingly, are classified in level 3 of the fair value hierarchy.

Assets Held-for-Sale

Assets held-for-sale as of June 30, 2020 and December 31, 2019 consists of former branches that are no longer in operation and parcels of land previously purchased for expansion. These properties are being actively marketed and were transferred into the held-for-sale category at their fair value as determined by current appraisals. Based on these valuation methods, they are classified in level 3 of the fair value hierarchy.

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Financial Instruments Not Required to be Measured at Fair Value

For certain financial instruments that are not required to be measured at fair value in the Consolidated Statements of Financial Condition, the Company must disclose the estimated fair values and the level within the fair value hierarchy as shown in the following table.

Fair Value Measurements of Other Financial Instruments

(Dollar amounts in thousands)

		As of
		June 30, 2020				December 31, 2019
	Fair Value Hierarchy Level	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Cash and due from banks	1	$	304,445	$	304,445	$	214,894	$	214,894
Interest-bearing deposits in other banks	2	637,856		637,856		84,327		84,327
Securities held-to-maturity	2	19,628		19,676		21,997		21,234
FHLB and FRB stock	2	148,512		148,512		115,409		115,409
Loans	3	14,693,606		14,739,129		12,733,200		12,535,848
Investment in BOLI	3	299,649		299,649		296,351		296,351
Accrued interest receivable	3	63,162		63,162		59,716		59,716
Liabilities
Deposits	2	$	15,657,656	$	15,667,051	$	13,251,278	$	13,247,871
Borrowed funds	2	2,305,195		2,305,195		1,658,758		1,658,758
Senior and subordinated debt	2	234,358		266,003		233,948		277,203
Accrued interest payable	2	7,633		7,633		10,502		10,502

Management uses various methodologies and assumptions to determine the estimated fair values of the financial instruments in the table above. The fair value estimates are made at a discrete point in time based on relevant market information and consider management's judgments regarding future expected economic conditions, loss experience, and specific risk characteristics of the financial instruments. Loans include the FDIC indemnification asset and net loans, which consists of loans held-for-investment, acquired loans, and the allowance for loan losses. As of both June 30, 2020 and December 31, 2019, the Company estimated the fair value of lending commitments outstanding to be immaterial.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

INTRODUCTION

First Midwest Bancorp, Inc. is a bank holding company headquartered in Chicago, Illinois, with operations in metropolitan Chicago, southeast Wisconsin, northwest Indiana, central and western Illinois, eastern Iowa, and other markets in the Midwest. Our principal subsidiary, First Midwest Bank, and other affiliates provide a full range of commercial, treasury management, equipment leasing, consumer, wealth management, trust, and private banking products and services through 132 banking locations. We are committed to meeting the financial needs of the people and businesses in the communities where we live and work by providing banking and wealth management solutions, quality products, and innovative services that fulfill those financial needs.

The following discussion and analysis is intended to address the significant factors affecting our Condensed Consolidated Statements of Income for the quarters and six months ended June 30, 2020 and 2019 and Consolidated Statements of Financial Condition as of June 30, 2020 and December 31, 2019. When we use the terms "First Midwest," the "Company," "we," "us," and "our," we mean First Midwest Bancorp, Inc. and its consolidated subsidiaries. When we use the term "Bank," we are referring to our wholly-owned banking subsidiary, First Midwest Bank. Management's discussion and analysis should be read in conjunction with the consolidated financial statements, accompanying notes thereto, and other information presented in Item 1 of this Quarterly Report on Form 10-Q ("Form 10-Q"), as well as in our 2019 Annual Report on Form 10-K ("2019 10-K"). The results of operations for the quarter and six months ended June 30, 2020 are not necessarily indicative of future results.

Our results of operations are affected by various factors, many of which are beyond our control, including interest rates, local, regional, and national economic conditions, business spending, consumer confidence, legislative and regulatory changes, certain seasonal factors, and changes in real estate and securities markets. Our management evaluates performance using a variety of qualitative and quantitative metrics. The primary quantitative metrics used by management include:

•Net Interest Income – Net interest income, our primary source of revenue, equals the difference between interest income and fees earned on interest-earning assets and interest expense incurred on interest-bearing liabilities.

•Net Interest Margin – Net interest margin equals tax-equivalent net interest income divided by total average interest-earning assets.

•Noninterest Income – Noninterest income is the income we earn from fee-based revenues, investment in bank-owned life insurance ("BOLI"), other income, and non-operating revenues.

•Noninterest Expense – Noninterest expense is the expense we incur to operate the Company, which includes salaries and employee benefits, net occupancy and equipment, professional services, and other costs.

•Asset Quality – Asset quality represents an estimation of the quality of our loan portfolio, including an assessment of the credit risk related to existing and potential loss exposure, and can be evaluated using a number of quantitative measures, such as non-performing loans to total loans.

•Regulatory Capital – Our regulatory capital is classified in one of the following tiers: (i) Common Equity Tier 1 capital ("CET1"), which consists of common equity and retained earnings, less goodwill and other intangible assets and a portion of disallowed deferred tax assets ("DTAs"), (ii) Tier 1 capital, which consists of CET1 and the remaining portion of disallowed DTAs, and (iii) Tier 2 capital, which includes qualifying subordinated debt, qualifying trust-preferred securities, and the allowance for credit losses, subject to limitations.

Some of these metrics may be presented on a basis not in accordance with U.S. generally accepted accounting principles ("non-GAAP"). For detail on our non-GAAP metrics, see the discussion in the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations." Unless otherwise stated, all earnings per common share data included in this section and throughout the remainder of this discussion are presented on a fully diluted basis.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Form 10-Q, as well as any oral statements made by or on behalf of First Midwest, may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by the use of words such as "may," "might," "will," "would," "should," "could," "expect," "plan," "intend," "anticipate," "believe," "estimate," "outlook," "predict," "project," "probable," "potential," "possible," "target," "continue," "look forward," or "assume" and words of similar import. Forward-looking statements are not historical facts or guarantees of future performance but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and events may differ, possibly materially, from the anticipated results or events indicated in these forward-looking statements. First

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Midwest cautions you not to place undue reliance on these statements. Forward-looking statements speak only as of the date made, and First Midwest undertakes no obligation to update any forward-looking statements.

Forward-looking statements may be deemed to include, among other things, statements relating to First Midwest's future financial performance, including the related outlook for 2020, the performance of First Midwest's loan or securities portfolio, the expected amount of future credit allowances or charge-offs, corporate strategies or objectives, including the impact of certain actions and initiatives, anticipated trends in First Midwest's business, regulatory developments, acquisition transactions, estimated synergies, cost savings and financial benefits of announced and completed transactions, growth strategies, including possible future acquisitions, and the continued effects of the COVID-19 pandemic (the "pandemic") on our business, financial condition, liquidity, loans, asset quality and results of operations. These statements are subject to certain risks, uncertainties and assumptions, including the duration, extent and severity of the pandemic, including the continued effects on our business, operations and employees, as well as on our customers and service providers, and on economies and markets more generally and other risks, uncertainties and assumptions that are discussed under the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this report and in First Midwest's 2019 10-K, and in First Midwest's subsequent filings made with the Securities and Exchange Commission ("SEC"). These risks and uncertainties are not exhaustive, and other sections of these reports describe additional factors that could adversely impact First Midwest's business and financial performance.

CRITICAL ACCOUNTING ESTIMATES

Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and are consistent with general practices within the banking industry. Application of GAAP requires management to make estimates, assumptions, and judgments based on the best available information as of the date of the financial statements that affect the amounts reported in the consolidated financial statements and accompanying notes. Critical accounting estimates are those estimates that management believes are the most important to our financial position and results of operations. Future changes in information may impact these estimates, assumptions, and judgments, which may have a material effect on the amounts reported in the financial statements. For additional information regarding critical accounting estimates, see the "Summary of Significant Accounting Policies," presented in Note 1 to the Consolidated Financial Statements and the section titled "Critical Accounting Estimates" in "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our 2019 10-K.

Upon adoption of Accounting Standards Updated ("ASU") 2016-13 on January 1, 2020, there were material changes to the Company's application of critical accounting estimates related to the allowance for credit losses and valuation of securities since December 31, 2019.

Allowance for Credit Losses

The determination of the allowance for credit losses is inherently subjective since it requires significant estimates and management judgment, including the amounts and timing of expected future cash flows, actual loss experience, consideration of current national, regional, and local economic trends and conditions, reasonable and supportable forecasts about the future, changes in interest rates and property values, various internal and external qualitative factors, and other factors, all of which are susceptible to significant change. Credit exposures deemed to be uncollectible are charged-off against the allowance for loan losses, while recoveries of amounts previously charged-off are credited to the allowance for credit losses. Additions to the allowance for credit losses are established through the provision for credit losses charged to expense. The amount charged to operating expense depends on a number of factors, including historic loan growth, changes in the composition of the loan portfolio, net charge-off levels, and our assessment of the allowance for credit losses, including our estimate of the impact of the pandemic. For additional discussion of the allowance for credit losses, see Notes 1 and 7 of "Notes to the Condensed Consolidated Financial Statements" in Part 1, Item 1 of this Form 10-Q.

Valuation of Securities

The fair values of securities are based on quoted prices obtained from third-party pricing services or dealer market participants where a ready market for such securities exists. In the absence of quoted prices or where a market for the security does not exist, management judgment and estimation is used, which may include modeling-based techniques. The use of different judgments and estimates to determine the fair value of securities could result in a different fair value estimate.

On a quarterly basis, the Company assesses securities with unrealized losses to determine whether impairment has occurred. In evaluating impairment, management considers many factors, including the severity of the impairment, the financial condition and near-term prospects of the issuer, including external credit ratings and recent downgrades for debt securities, intent to hold the security until its value recovers, and the likelihood that the Company would be required to sell the securities before a recovery in value, which may be at maturity. Securities for which there is an unrealized loss that is deemed to be a credit-related impairment are recorded as an allowance through a charge to expense through noninterest expense, limited to the difference

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between amortized cost and fair value. Securities for which there is an unrealized loss that is not deemed to be a credit-related impairment are recorded through other comprehensive income (loss). The determination of impairment is subjective and different judgments and assumptions could affect the timing and amount of loss realization. For additional discussion of securities, see Notes 1 and 4 of "Notes to the Condensed Consolidated Financial Statements" in Part 1, Item 1 of this Form 10-Q.

There have been no material changes in the Company's application of critical accounting estimates related to income taxes and goodwill and other intangible assets since December 31, 2019.

ADOPTION OF THE CURRENT EXPECTED CREDIT LOSSES STANDARD

On January 1, 2020, the Company adopted the current expected credit losses accounting standard ("CECL"), which requires the Company to present financial assets measured at amortized cost at the net amount expected to be collected considering our current estimate of all expected credit losses. Adoption of this standard on January 1, 2020 increased the allowance for credit losses by $76 million, which includes $32 million attributable to loans and unfunded commitments and $44 million attributable to purchased credit deteriorated ("PCD") and non-PCD acquired loans. For additional discussion of adopted accounting pronouncements, see Note 2 of "Notes to the Condensed Consolidated Financial Statements" in Part 1, Item 1 of this Form 10-Q.

COVID-19 PANDEMIC

The pandemic and the resulting governmental responses continue to impact our business and operations, as well as the business and operations of our clients. A variety of restrictions have been placed on companies and individuals throughout our primary operating footprint of Illinois, Wisconsin, Indiana and Iowa. In Illinois, where we are headquartered and conduct the substantial majority of our operations, the shelter-in-place order that was previously in place since March 2020, was lifted during the second quarter of 2020, although ongoing business restrictions are still in place as Illinois, Chicago, and other regions proceed through a phased reopening. The pandemic and these governmental measures have created and are expected to continue to create significant economic disruption and decreased economic activity.

We have experienced, and are likely to continue to experience in the future, a number of financial impacts as a result of the pandemic and governmental responses to it, including a higher provision for loan losses and lower net interest and noninterest income. Additionally, we are actively participating in the U.S. Small Business Association's Paycheck Protection Program ("PPP"), and have funded approximately $1.2 billion of these loans. PPP loans are being funded by a combination of deposits and borrowings, with the related processing fees earned being recognized as a yield adjustment over the terms of these loans. We are also committed to using our strong capital levels and ample liquidity to support our clients and communities as they navigate the pandemic. We are offering several programs and services to support our clients, including:

•Consumer, mortgage, and auto loan payment deferrals;

•Small business payment deferrals;

•Consumer and small business fee assistance programs;

•A suspension of foreclosure and repossession actions; and

•A wide range of financial accommodations for our commercial clients based on individual circumstances.

We have included additional disclosure throughout this Item 2 in this Form 10-Q regarding the impact of the pandemic, including with respect to our loan portfolio, income, and funding and liquidity.

We have modified our operations to comply with governmental restrictions and public health authority guidelines. Substantially all non-client facing colleagues are working remotely. A majority of our branches remain open for business through drive-up services and lobbies by appointment only, with certain branches open for walk-in lobby traffic. For those colleagues who work on-site, they are subject to enhanced health and safety protocols.

Additionally, we have implemented a variety of policies and programs to support our colleagues during the pandemic. We have expanded our paid time off programs for all colleagues and added health and welfare benefits for all colleagues, including emergency medical and hardship loans, enhanced health insurance programs, and access to retirement benefits under certain pandemic-related circumstances.

Consistent with our long-standing emphasis on community engagement, we are actively supporting the communities we serve during the pandemic. We have committed $2.5 million from the First Midwest Charitable Foundation to support the immediate and long-term needs of our communities. This commitment does not impact current or future expense. We also recently introduced enhanced matching gift programs to support colleague donations to eligible 501(c)(3) organizations.

For additional information regarding the risks associated with the pandemic and its expected impact on the Company, refer to the section entitled "Risk Factors" in Part II, Item 1A of this Form 10-Q.

43

PARK BANK ACQUISITION

On March 9, 2020, the Company completed its acquisition of Bankmanagers Corp. ("Bankmanagers"), the holding company for Park Bank, based in Milwaukee Wisconsin. At closing, the Company acquired $1.2 billion of assets, $1.0 billion of deposits, and $685.5 million of loans, net of fair value adjustments. Under the terms of the merger agreement, on March 9, 2020, each outstanding share of Bankmanagers common stock was exchanged for 29.9675 shares of Company common stock, plus $623.02 of cash (of which $346.00 per share was paid by Bankmanagers to its shareholders by a special cash dividend immediately prior to closing). This resulted in merger consideration of $174.4 million, which consisted of 4.9 million shares of Company common stock and $102.5 million of cash. Goodwill of $62.4 million associated with the acquisition was recorded by the Company. Park Bank merged into First Midwest Bank and all operating systems were converted in the second quarter of 2020.

ISSUANCE OF PREFERRED STOCK

During the second quarter of 2020, the Company issued 4.3 million depositary shares, each representing a 1/40th interest in a share of the Company's 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, and 4.9 million depositary shares, each representing a 1/40th interest in a share of the Company's Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, for an aggregate of $230.5 million. The Company received proceeds of $221.3 million, net of underwriting discounts and commissions and issuance costs and expects to use the proceeds for general corporate purposes.

STOCK REPURCHASES

On February 26, 2020, the Company announced a stock repurchase program, under which the Company is authorized to repurchase up to $200 million of its outstanding common stock through December 31, 2021. This stock repurchase program replaces the prior $180 million program, which was scheduled to expire in March 2020. The stock repurchase program does not obligate the Company to repurchase a specific dollar amount or number of shares, and the program may be extended, modified, or discontinued at any time. Repurchases under the Company's repurchase programs are made at prices determined by the Company.

The Company suspended repurchases in March as it shifted its capital deployment strategy in response to the pandemic. Prior to this action, the Company repurchased 1.2 million shares of its common stock at a total cost of $22.6 million during the six months ended June 30, 2020.

44

PERFORMANCE OVERVIEW

Table 1

Selected Financial Data

(Amounts in thousands, except per share data)

	Quarters Ended   June 30,						Six Months Ended   June 30,
	2020			2019			2020			2019
Operating Results
Interest income	$	162,044		$	177,682		$	332,271		$	340,172
Interest expense	16,810			27,370			43,462			50,836
Net interest income	145,234			150,312			288,809			289,336
Provision for loan losses	32,649			11,491			72,181			21,935
Noninterest income	32,991			38,526			72,353			73,432
Noninterest expense	120,330			114,142			237,661			216,252
Income before income tax expense	25,246			63,205			51,320			124,581
Income tax expense	6,182			16,191			12,650			31,509
Net income	$	19,064		$	47,014		$	38,670		$	93,072
Preferred dividends	(1,037)			—			(1,037)			—
Net income applicable to non-vested restricted shares	(187)			(389)			(379)			(792)
Net income applicable to common shares	$	17,840		$	46,625		$	37,254		$	92,280
Weighted-average diluted common shares outstanding	113,336			108,467			111,872			107,126
Diluted earnings per common share	$	0.16		$	0.43		$	0.33		$	0.86
Diluted earnings per common share, adjusted(1)	$	0.19		$	0.50		$	0.41		$	0.96
Performance Ratios
Return on average common equity(2)	2.94		%	8.34		%	3.08		%	8.50		%
Return on average common equity, adjusted(1)(2)	3.58		%	9.68		%	3.81		%	9.46		%
Return on average tangible common equity(2)	5.32		%	13.83		%	5.49		%	14.11		%
Return on average tangible common equity, adjusted(1)(2)	6.37		%	15.95		%	6.65		%	15.64		%
Return on average assets(2)	0.37		%	1.13		%	0.40		%	1.16		%
Return on average assets, adjusted(1)(2)	0.44		%	1.31		%	0.49		%	1.29		%
Tax-equivalent net interest margin(1)(2)(3)	3.13		%	4.06		%	3.16		%	4.05		%
Tax-equivalent net interest margin, adjusted(1)(2)(3)	2.98		%	3.78		%	3.05		%	3.82		%
Efficiency ratio(1)	64.08		%	54.67		%	62.12		%	55.16		%

⁽¹⁾This item is a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

⁽²⁾These ratios are presented on an annualized basis.

⁽³⁾See the section of this Item 2 titled "Earnings Performance" below for additional discussion and calculation of this financial measure.

45

	As of									June 30, 2020   Change From
	June 30, 2020			December 31, 2019			June 30, 2019			December 31, 2019		June 30, 2019
Balance Sheet Highlights
Total assets	$	21,244,881		$	17,850,397		$	17,462,233		$	3,394,484	$	3,782,648
Total loans	14,933,658			12,840,330			12,519,604			2,093,328		2,414,054
Total deposits	15,657,656			13,251,278			13,188,588			2,406,378		2,469,068
Core deposits	13,301,389			10,217,824			10,236,783			3,083,565		3,064,606
Loans to deposits	95.4		%	96.9		%	94.9		%
Core deposits to total deposits	85.0		%	77.1		%	77.6		%
Asset Quality Highlights
Non-accrual loans, excluding PCD   loans(1)(2)	$	94,044		$	82,269		$	63,477		$	11,775	$	30,567
Non-accrual PCD loans(1)	45,116			—			—			45,116		45,116
Total non-accrual loans	139,160			82,269			63,477			56,891		75,683
90 days or more past due loans, still   accruing interest(1)	3,241			5,001			2,615			(1,760)		626
Total non-performing loans	142,401			87,270			66,092			55,131		76,309
Accruing troubled debt restructurings ("TDRs")	1,201			1,233			1,441			(32)		(240)
Foreclosed assets(3)	19,024			20,458			28,488			(1,434)		(9,464)
Total non-performing assets	$	162,626		$	108,961		$	96,021		$	53,665	$	66,605
30-89 days past due loans(1)	$	36,342		$	31,958		$	34,460		$	4,384	$	1,882
Non-performing assets to total loans plus foreclosed assets	1.09		%	0.85		%	0.77		%
Non-performing assets to total loans plus   foreclosed assets, excluding PCD and   PPP loans(1)(2)(5)	0.87		%	0.85		%	0.77		%
Allowance for Credit Losses
Allowance for credit losses	$	247,677		$	109,222		$	106,929		$	138,455	$	140,748
Allowance for credit losses to total loans(4)	1.66		%	0.85		%	0.85		%
Allowance for credit losses to   total loans, excluding PPP loans(4)(5)	1.80		%	0.85		%	0.85		%
Allowance for credit losses to non-accrual loans	177.98		%	132.76		%	168.45		%

⁽¹⁾Prior to the adoption of CECL on January 1, 2020, purchased credit impaired ("PCI") loans with an accretable yield were considered current and were not included in past due loan totals. In addition, PCI loans with an accretable yield were excluded from non-accrual loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals. In addition, an allowance for credit losses is established as of the acquisition date or upon the adoption of CECL for loans previously classified as PCI, as PCD loans are no longer recorded net of a credit-related acquisition adjustment.

⁽²⁾This item is a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

⁽³⁾Foreclosed assets consists of other real estate owned ("OREO") and other foreclosed assets acquired in partial or total satisfaction of defaulted loans. Other foreclosed assets are included in other assets in the Consolidated Statements of Financial Condition.

⁽⁴⁾Prior to the adoption of CECL on January 1, 2020, this ratio included acquired loans that were recorded at fair value through an acquisition adjustment netted in loans. Subsequent to adoption, an allowance for credit losses on acquired loans is established as of the acquisition date and the acquired loans are no longer recorded net of a credit-related acquisition adjustment.

⁽⁵⁾This ratio excludes PPP loans that are expected to be forgiven. As a result, no allowance for credit losses is associated with these loans. See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.

46

EARNINGS PERFORMANCE

Net Interest Income

Net interest income is our primary source of revenue and is impacted by interest rates and the volume and mix of interest-earning assets and interest-bearing liabilities. The accounting policies for the recognition of interest income on loans, securities, and other interest-earning assets are presented in Note 1 to the Consolidated Financial Statements included in our 2019 10-K.

Our accounting and reporting policies conform to GAAP and general practices within the banking industry. For purposes of this discussion, both net interest income and net interest margin have been adjusted to a fully tax-equivalent basis to more appropriately compare the returns on certain tax-exempt loans and securities to those on taxable interest-earning assets. The effect of this adjustment is shown at the bottom of Table 2 below. Although we believe that these non-GAAP financial measures enhance investors' understanding of our business and performance, they should not be considered an alternative to GAAP. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

Table 2 summarizes our average interest-earning assets and interest-bearing liabilities for the quarters ended June 30, 2020 and 2019, the related interest income and interest expense for each earning asset category and funding source, and the average interest rates earned and paid. Table 2 also details differences in interest income and expense from the prior quarter and the extent to which any changes are attributable to volume and rate fluctuations. Table 3 below presents this same information for the six months ended June 30, 2020 and 2019.

47

Table 2

Net Interest Income and Margin Analysis

(Dollar amounts in thousands)

	Quarters Ended June 30,										Attribution of Change in Net Interest Income
	2020					2019
	Average Balance		Interest		Yield/ Rate (%)	Average Balance		Interest		Yield/ Rate (%)	Volume		Yield/ Rate		Total
Assets
Other interest-earning assets	$	646,887	$	471	0.29	$	210,322	$	1,240	2.36	$	2,574	$	(3,343)	$	(769)
Securities(1)	3,357,984		21,040		2.51	2,631,437		18,423		2.80	4,234		(1,617)		2,617
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") stock	154,678		368		0.95	87,815		757		3.45	577		(966)		(389)
Loans, excluding PPP loans(1)	13,729,250		135,952		3.98	12,022,470		158,442		5.29	70,752		(93,242)		(22,490)
PPP loans(1)	887,997		5,368		2.43	—		—		—	2,326		3,042		5,368
Total loans(1)(2)	14,617,247		141,320		3.89	12,022,470		158,442		5.29	73,078		(90,200)		(17,122)
Total interest-earning assets(1)(2)	18,776,796		163,199		3.49	14,952,044		178,862		4.80	80,463		(96,126)		(15,663)
Cash and due from banks	275,696					215,464
Allowance for loan losses	(224,519)					(108,698)
Other assets	2,040,133					1,681,240
Total assets	$	20,868,106				$	16,740,050
Liabilities and Stockholders' Equity
Savings deposits	$	2,246,643	99		0.02	$	2,079,852	346		0.07	31		(278)		(247)
NOW accounts	2,549,088		637		0.10	2,261,103		2,776		0.49	408		(2,547)		(2,139)
Money market deposits	2,663,622		1,157		0.17	1,907,766		3,041		0.64	2,254		(4,138)		(1,884)
Time deposits	2,539,996		8,184		1.30	2,849,930		13,153		1.85	(1,316)		(3,653)		(4,969)
Borrowed funds	2,466,300		3,156		0.51	1,025,351		4,459		1.74	6,268		(7,571)		(1,303)
Senior and subordinated debt	234,259		3,577		6.14	220,756		3,595		6.53	251		(269)		(18)
Total interest-bearing liabilities	12,699,908		16,810		0.53	10,344,758		27,370		1.06	7,896		(18,456)		(10,560)
Demand deposits	5,305,109					3,835,567
Total funding sources	18,005,017				0.38	14,180,325				0.77
Other liabilities	361,311					318,156
Stockholders' equity	2,501,778					2,241,569
Total liabilities and stockholders' equity	$	20,868,106				$	16,740,050
Tax-equivalent net interest   income/margin(1)			146,389		3.13			151,492		4.06	$	72,567	$	(77,670)	$	(5,103)
Tax-equivalent adjustment			(1,155)					(1,180)
Net interest income (GAAP)			$	145,234				$	150,312
Impact of acquired loan   accretion(1)			$	6,999	0.15			$	10,308	0.28
Tax-equivalent net interest income/   margin, adjusted(1)			$	139,390	2.98			$	141,184	3.78

⁽¹⁾Interest income and yields on tax-exempt securities and loans are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%. The corresponding income tax impact related to tax-exempt items is recorded in income tax expense. These adjustments have no impact on net income. See the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations" for a discussion of this non-GAAP financial measure.

⁽²⁾Non-accrual loans, which totaled $139.2 million as of June 30, 2020 and $63.5 million as of June 30, 2019, are included in loans for purposes of this analysis. Additional detail regarding non-accrual loans is presented in the following section of this Item 2 titled "Non-performing Assets and Corporate Performing Potential Problem Loans."

48

Table 3

Net Interest Income and Margin Analysis

(Dollar amounts in thousands)

	Six Months Ended June 30,										Attribution of Change in Net Interest Income
	2020					2019
	Average Balance		Interest		Yield/ Rate (%)	Average Balance		Interest		Yield/ Rate (%)	Volume		Yield/ Rate		Total
Assets
Other interest-earning assets	$	405,619	$	1,287	0.64	$	168,203	$	1,968	2.36	$	2,778	$	(3,459)	$	(681)
Securities(1)	3,212,279		41,797		1.73	2,502,282		34,810		2.78	9,060		(2,073)		6,987
FHLB and FRB stock	140,661		1,755		1.66	83,840		1,709		4.08	108		(62)		46
Loans, excluding PPP loans(1)	13,401,500		284,372		4.27	11,741,910		303,973		5.22	201,538		(221,160)		(19,622)
PPP loans(1)	443,999		5,368		2.43	—		—		—	2,593		2,775		5,368
Total loans(1)(2)	13,845,499		289,740		4.21	11,741,910		303,973		5.22	204,131		(218,385)		(14,254)
Total interest-earning assets(1)(2)	17,604,058		334,579		3.65	14,496,235		342,460		4.76	216,077		(223,979)		(7,902)
Cash and due from banks	268,516					208,819
Allowance for loan losses	(201,956)					(108,112)
Other assets	1,965,845					1,609,964
Total assets	$	19,636,463				$	16,206,906
Liabilities and Stockholders' Equity
Savings deposits	$	2,157,903	262		0.02	$	2,058,958	692		0.07	35		(465)		(430)
NOW accounts	2,411,122		2,267		0.19	2,172,725		4,938		0.46	615		(3,286)		(2,671)
Money market deposits	2,445,664		4,257		0.35	1,858,772		5,390		0.58	4,259		(5,392)		(1,133)
Time deposits	2,736,231		20,408		1.50	2,749,182		24,898		1.83	(116)		(4,374)		(4,490)
Borrowed funds	2,237,000		8,997		0.81	952,080		8,010		1.70	1,609		(622)		987
Senior and subordinated debt	234,157		7,271		6.24	212,375		6,908		6.56	651		(288)		363
Total interest-bearing liabilities	12,222,077		43,462		0.72	10,004,092		50,836		1.02	7,053		(14,427)		(7,374)
Demand deposits	4,594,562					3,712,209
Total funding sources	16,816,639				0.52	13,716,301				0.75
Other liabilities	361,357					300,395
Stockholders' equity	2,458,467					2,190,210
Total liabilities and stockholders' equity	$	19,636,463				$	16,206,906
Tax-equivalent net interest   income/margin(1)			291,117		3.16			291,624		4.05	$	209,024	$	(209,552)	$	(528)
Tax-equivalent adjustment			(2,308)					(2,288)
Net interest income (GAAP)			$	288,809				$	289,336
Impact of acquired loan   accretion(1)			$	13,945	0.11			$	16,677	0.23
Tax-equivalent net interest income/   margin, adjusted(1)			$	277,172	3.05			$	274,947	3.82

⁽¹⁾Interest income and yields on tax-exempt securities and loans are presented on a tax-equivalent basis, assuming a federal income tax rate of 21%. The corresponding income tax impact related to tax-exempt items is recorded in income tax expense. These adjustments have no impact on net income. See the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations" for a discussion of this non-GAAP financial measure.

⁽²⁾Non-accrual loans, which totaled $139.2 million as of June 30, 2020 and $63.5 million as of June 30, 2019, are included in loans for purposes of this analysis. Additional detail regarding non-accrual loans is presented in the following section of this Item 2 titled "Non-performing Assets and Corporate Performing Potential Problem Loans."

Net interest income for the second quarter and first six months of 2020 was down 3.4% compared to the second quarter of 2019 and consistent with the first six months of 2019. Compared to both prior periods, net interest income was impacted by lower interest rates, partially offset by growth in loans and securities, the acquisition of interest-earning assets from the Park Bank and Bridgeview Bank ("Bridgeview") transactions that closed in March 2020 and May 2019, respectively, and lower cost of funds.

49

Acquired loan accretion contributed $7.0 million and $13.9 million for the second quarter and first six months of 2020, respectively, lower than the $10.3 million and $16.7 million for the same periods in 2019.

Tax-equivalent net interest margin for the second quarter and first six months of 2020 was 3.13% and 3.16%, respectively, decreasing 93 basis points and 89 basis points from the same periods in 2019. Excluding the impact of acquired loan accretion, tax-equivalent net interest margin was 2.98% and 3.05% for the second quarter and first six months of 2020, down 80 basis points and 77 basis points from the same periods in 2019. Compared to both prior periods, tax-equivalent net interest margin decreased as a result of lower interest rates on loans and securities, origination of PPP loans, actions taken to reduce rate sensitivity, as well as a higher balance of other interest-earning assets due to higher demand deposits as a result of PPP loan funds and other government stimuli, partially offset by lower cost of funds.

For the second quarter and first six months of 2020, total average interest-earning assets rose by $3.8 billion and $3.1 billion from the same periods in 2019. The increase resulted primarily from the Park Bank and Bridgeview transactions, PPP loans and other loan growth, securities purchases, and a higher balance of other interest-earning assets.

Total average funding sources for the second quarter and first six months of 2020 increased by $3.8 billion and $2.2 billion from the same periods in 2019, due primarily to the Park Bank and Bridgeview transactions, FHLB advances, and higher customer balances resulting from PPP funds and other government stimulus.

Noninterest Income

A summary of noninterest income for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

Table 4

Noninterest Income Analysis

(Dollar amounts in thousands)

	Quarters Ended   June 30,					Six Months Ended   June 30,
	2020		2019		% Change	2020		2019		% Change
Wealth management fees	$	11,942	$	12,190	(2.0)	$	24,303	$	23,790	2.2
Service charges on deposit accounts	9,125		12,196		(25.2)	20,906		23,736		(11.9)
Mortgage banking income	3,477		1,901		82.9	5,265		2,905		81.2
Card-based fees, net (1)	3,180		4,549		(30.1)	7,148		8,927		(19.9)
Capital market products income	694		2,154		(67.8)	5,416		3,433		57.8
Other service charges, commissions, and fees	2,078		2,783		(25.3)	4,760		5,394		(11.8)
Total fee-based revenues	30,496		35,773		(14.8)	67,798		68,185		(0.6)
Other income(2)	2,495		2,753		(9.4)	5,560		5,247		6.0
Net securities losses	—		—		—	(1,005)		—		—
Total noninterest income	$	32,991	$	38,526	(14.4)	$	72,353	$	73,432	(1.5)

⁽¹⁾Card-based fees, net consists of debit and credit card interchange fees for processing transactions, various fees on both consumer and non-customer automated teller machine ("ATM") and point-of-sale transactions processed through the ATM and point-of-sale networks, as well as the related cardholder expense.

⁽²⁾Other income consists of various items, including BOLI income, safe deposit box rentals, miscellaneous recoveries, and gains on the sales of various assets.

Total noninterest income of $33.0 million and $72.4 million for the second quarter and first six months of 2020, respectively, was down 14.4% and 1.5% from the same periods in 2019. The decrease in services charges on deposit accounts, net card-based fees, and other service charges, commissions and fees compared to both prior periods was due primarily to the impact of lower transaction volumes and the fee assistance programs offered to our clients as a result of the pandemic.

Mortgage banking income for the second quarter and first six months of 2020 resulted from sales of $168.7 million and $285.3 million of 1-4 family mortgage loans in the secondary market, compared to $93.5 million and $150.9 million for the same periods in 2019. Capital market products income for the second quarter of 2020 decreased compared to the second quarter of 2019 as a result of lower levels of sales to corporate clients in light of market conditions. Compared to the first six months of 2019, capital market products income increased as a result of higher sales to corporate clients during the first quarter of 2020 reflecting the lower long-term rate environment.

50

Net securities losses of $1.0 million were recognized during the first six months of 2020 as a result of repositioning of the Company's securities portfolio due to market conditions.

Noninterest Expense

A summary of noninterest expense for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

Table 5

Noninterest Expense Analysis

(Dollar amounts in thousands)

	Quarters Ended   June 30,					Six Months Ended   June 30,
	2020		2019		% Change	2020		2019		% Change
Salaries and employee benefits:
Salaries and wages	$	52,592	$	47,776	10.1	$	102,582	$	93,911	9.2
Retirement and other employee benefits	11,080		10,916		1.5	23,949		22,154		8.1
Total salaries and employee benefits	63,672		58,692		8.5	126,531		116,065		9.0
Net occupancy and equipment expense	15,116		12,294		23.0	29,343		26,091		12.5
Technology and related costs	9,853		7,128		38.2	18,401		13,398		37.3
Professional services	8,880		9,624		(7.7)	19,270		16,711		15.3
Advertising and promotions	2,810		3,167		(11.3)	5,571		5,539		0.6
Net OREO expense	126		294		57.1	546		975		(44.0)
Other expenses	14,624		12,987		12.6	27,278		23,568		15.7
Acquisition and integration related expenses	5,249		9,514		(44.8)	10,721		13,205		(18.8)
Delivering Excellence implementation costs	—		442		(100.0)	—		700		(100.0)
Total noninterest expense	$	120,330	$	114,142	5.4	$	237,661	$	216,252	9.9
Acquisition and integration related expenses	(5,249)		(9,514)		(44.8)	(10,721)		(13,205)		(18.8)
Delivering Excellence implementation costs	—		(442)		(100.0)	—		(700)		(100.0)
Total noninterest expense, adjusted(1)	$	115,081	$	104,186	10.5	$	226,940	$	202,347	12.2

⁽¹⁾This item is a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

Total noninterest expense increased 5.4% and 9.9% from the second quarter and first six months of 2019, respectively. Noninterest expense for all periods presented was impacted by acquisition and integration related expenses. The second quarter and first six months of 2019 was impacted by costs related to implementation of the Company's Delivering Excellence initiative. Excluding these items, noninterest expense for the second quarter and first six months of 2020, respectively, was $115.1 million and $226.9 million, up 10.5% and 12.2% from the same periods in 2019. Overall, noninterest expense, adjusted, to average assets, excluding PPP loans was well controlled at 2.32% and 2.38% for the second quarter and first six months of 2020, respectively, down 18 basis points and 14 basis points from the second quarter and first six months of 2019, respectively.

Operating costs associated with the Park Bank and Bridgeview transactions contributed to the increase in noninterest expense for the second quarter and first six months of 2020. These costs primarily occurred in salaries and employee benefits, net occupancy and equipment expense, professional services, technology and related costs, and other expenses.

Compared to both prior periods, the increase in salaries and employee benefits was also impacted by merit increases, commissions resulting from sales of 1-4 family mortgage loans in the secondary market, and expanded health and welfare benefits related to the pandemic, partially offset by lower incentive compensation expenses and equity compensation valuations. Expenses from the pandemic contributed to the increase in occupancy and equipment costs compared to both prior periods. Compared to both prior periods, the increase in technology and related costs was impacted by investments in technology, including certain costs associated with the origination of PPP loans. Professional services was positively impacted by lower loan remediation expenses compared to both prior periods. For the first six months of 2020, professional services were impacted by process enhancements and expenses associated with higher capital market products income. Compared to both prior periods, other expenses increased as a result of a valuation adjustment on a foreclosed asset, higher servicing fees from purchases of consumer loans and other miscellaneous expenses associated with organizational growth.

51

Acquisition and integration related expenses for the second quarter and first six months of 2020 resulted primarily from the Park Bank and Bridgeview acquisitions. For the second quarter and first six months of 2019, acquisition and integration related expenses resulted from the Northern States, Northern Oak, and Bridgeview acquisitions.

Income Taxes

Our provision for income taxes includes both federal and state income tax expense. An analysis of the provision for income taxes for the quarters and six months ended June 30, 2020 and 2019 is detailed in the following table.

Table 6

Income Tax Expense Analysis

(Dollar amounts in thousands)

	Quarters Ended   June 30,						Six Months Ended   June 30,
	2020			2019			2020			2019
Income before income tax expense	$	25,246		$	63,205		$	51,320		$	124,581
Income tax expense:
Federal income tax expense	$	4,963		$	11,932		$	10,300		$	22,998
State income tax expense	1,219			4,259			2,350			8,511
Total income tax expense	$	6,182		$	16,191		$	12,650		$	31,509
Effective income tax rate	24.5		%	25.6		%	24.6		%	25.3		%

Federal income tax expense and the related effective income tax rate are influenced by the amount of tax-exempt income derived from investment securities and BOLI in relation to pre-tax income as well as state income taxes. State income tax expense and the related effective income tax rate are driven by the amount of state tax-exempt income in relation to pre-tax income and state tax rules related to consolidated/combined reporting and sourcing of income and expense.

The decrease in income tax expense and effective tax rate for the second quarter and six months ended June 30, 2020 was driven primarily by lower levels of income subject to tax at statutory rates.

Our accounting policies regarding the recognition of income taxes in the Consolidated Statements of Financial Condition and Income are described in Notes 1 and 16 to the Consolidated Financial Statements of our 2019 10-K.

FINANCIAL CONDITION

Investment Portfolio Management

Securities that we have the intent and ability to hold until maturity are classified as securities held-to-maturity and are accounted for using historical cost, adjusted for amortization of premiums and accretion of discounts. Equity securities are carried at fair value and consist primarily of community development investments and certain diversified investment securities held in a grantor trust for participants in the Company's nonqualified deferred compensation plan that are invested in money market and mutual funds. All other securities are classified as securities available-for-sale and are carried at fair value with unrealized gains and losses, net of related deferred income taxes, recorded in stockholders' equity as a separate component of accumulated other comprehensive income (loss).

We manage our investment portfolio to maximize the return on invested funds within acceptable risk guidelines, to meet pledging and liquidity requirements, and to adjust balance sheet interest rate sensitivity to mitigate the impact of changes in interest rates on net interest income.

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From time to time, we adjust the size and composition of our securities portfolio based on a number of factors, including expected loan growth, anticipated changes in collateralized public funds on account, the interest rate environment, and the related value of various segments of the securities markets. The following table provides a valuation summary of our investment portfolio.

Table 7

Investment Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020							As of December 31, 2019
	Amortized Cost		Net Unrealized Gains (Losses)		Fair Value		% of Total	Amortized Cost		Net Unrealized Gains (Losses)		Fair Value		% of Total
Securities Available-for-Sale
U.S. treasury securities	$	20,992	$	207	$	21,199	0.6	$	33,939	$	136	$	34,075	1.2
U.S. agency securities	640,253		2,794		643,047		18.7	249,502		(1,078)		248,424		8.6
Collateralized mortgage obligations ("CMOs")	1,624,609		47,520		1,672,129		48.7	1,547,805		9,866		1,557,671		54.2
Other mortgage-backed securities ("MBSs")	695,218		19,922		715,140		20.8	678,804		5,880		684,684		23.8
Municipal securities	229,414		10,389		239,803		7.0	228,632		5,799		234,431		8.2
Corporate debt securities	143,639		905		144,544		4.2	112,797		1,304		114,101		4.0
Total securities available-for-sale	$	3,354,125	$	81,737	$	3,435,862	100.0	$	2,851,479	$	21,907	$	2,873,386	100.0
Securities Held-to-Maturity
Municipal securities(1)	$	19,628	$	48	$	19,676		$	21,997	$	(763)	$	21,234
Equity Securities					$	43,954						$	42,136

⁽¹⁾Net of $220,000 of allowance for securities held-to-maturity as of June 30, 2020 which was established upon adoption of CECL on January 1, 2020.

Portfolio Composition

As of June 30, 2020, our securities available-for-sale portfolio totaled $3.4 billion, increasing $562.5 million, or 19.6%, from December 31, 2019. The increase from December 31, 2019 was driven primarily by purchases, consisting primarily of U.S. agency securities and CMOs, as well as $136.9 million of securities acquired in the Park Bank transaction and a change in unrealized gains (losses) due to lower market interest rates, which were partially offset by maturities, calls, and prepayments.

Investments in municipal securities consist of general obligations of local municipalities in multiple states. Our municipal securities portfolio has historically experienced very low default rates and provides a predictable cash flow.

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The following table presents the effective duration, average life, and yield to maturity for the Company's securities portfolio by category as of June 30, 2020 and December 31, 2019.

Table 8

Securities Effective Duration Analysis

	As of June 30, 2020					As of December 31, 2019
	Effective		Average	Yield to		Effective		Average	Yield to
	Duration(1)		Life(2)	Maturity(3)		Duration(1)		Life(2)	Maturity(3)
Securities Available-for-Sale
U.S. treasury securities	0.48	%	0.50	2.14	%	0.66	%	0.69	2.27	%
U.S. agency securities	3.51	%	3.14	2.53	%	3.07	%	5.50	2.56	%
CMOs	2.39	%	3.53	2.38	%	2.98	%	4.59	2.55	%
MBSs	2.89	%	3.53	2.46	%	4.05	%	4.94	2.79	%
Municipal securities	4.32	%	4.48	2.85	%	4.35	%	4.58	2.77	%
Corporate debt securities	2.01	%	5.24	2.66	%	1.39	%	5.63	3.15	%
Total securities available-for-sale	2.81	%	3.57	2.47	%	3.26	%	4.75	2.65	%
Securities Held-to-Maturity
Municipal securities	3.47	%	4.09	4.31	%	3.24	%	4.09	4.52	%

⁽¹⁾The effective duration represents the estimated percentage change in the fair value of the securities portfolio given a 100 basis point increase or decrease in interest rates. This measure is used to evaluate the portfolio's price volatility at a single point in time and is not intended to be a precise predictor of future fair values since those values will be influenced by a number of factors.

⁽²⁾Average life is presented in years and represents the weighted-average time to receive half of all expected future cash flows using the dollar amount of principal paydowns, including estimated principal prepayments, as the weighting factor.

⁽³⁾Yields on municipal securities are reflected on a tax-equivalent basis, assuming the applicable federal income tax rate for each period presented.

Effective Duration

The average life and effective duration of our securities available-for-sale portfolio was 3.57 years and 2.81%, respectively, as of June 30, 2020, down from 4.75 years and 3.26% as of December 31, 2019. The decrease resulted primarily from higher expected future prepayments of CMOs and MBSs due to lower market interest rates.

Realized Gains and Losses

There were no net securities losses for the second quarter of 2020 and net securities losses of $1.0 million for the first six months of 2020, as a result of repositioning of the securities portfolio due to market conditions. There were no securities gains (losses) or impairment charges recognized during the second quarter and first six months of 2019.

Unrealized Gains and Losses

Unrealized gains and losses on securities available-for-sale represent the difference between the aggregate cost and fair value of the portfolio. These amounts are presented in the Consolidated Statements of Comprehensive Income and reported as a separate component of stockholders' equity in accumulated other comprehensive income (loss), net of deferred income taxes. This balance sheet component will fluctuate as interest rates and conditions change and affect the aggregate fair value of the portfolio. Lower market interest rates drove the change to $81.7 million of unrealized gains as of June 30, 2020 compared to $21.9 million of unrealized gains as of December 31, 2019.

LOAN PORTFOLIO AND CREDIT QUALITY

Portfolio Composition

Our loan portfolio is comprised of both corporate and consumer loans, with corporate loans representing 76.3% of total loans as of June 30, 2020. Consistent with our emphasis on relationship banking, the majority of our corporate loans are made to our core, multi-relationship customers. The customers usually maintain deposit relationships and utilize certain of our other banking services, such as treasury or wealth management services.

To maximize loan income within an acceptable level of risk, we have certain lending policies and procedures that management reviews on a regular basis. In addition, management receives periodic reporting related to loan production, loan quality, credit concentrations, loan delinquencies, and non-performing and corporate performing potential problem loans to monitor and mitigate potential and current risks in the portfolio.

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Table 9

Loan Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020		% of Total Loans	As of December 31, 2019		% of Total Loans	% Change
Commercial and industrial	$	4,789,556	32.1	$	4,481,525	34.9	6.9
Agricultural	381,124		2.5	405,616		3.2	(6.0)
Commercial real estate:
Office, retail, and industrial	2,020,318		13.5	1,848,718		14.4	9.3
Multi-family	874,861		5.8	856,553		6.7	2.1
Construction	687,063		4.6	593,093		4.6	15.8
Other commercial real estate	1,475,937		9.9	1,383,708		10.8	6.7
Total commercial real estate	5,058,179		33.8	4,682,072		36.5	8.0
Total corporate loans, excluding PPP loans	10,228,859		68.4	9,569,213		74.6	6.9
PPP loans	1,179,403		7.9	—		—	N/M
Total corporate loans	11,408,262		76.3	9,569,213		74.5	16.6
Home equity	892,867		6.0	851,454		6.6	4.9
1-4 family mortgages	2,175,322		14.6	1,927,078		15.0	12.9
Installment	457,207		3.1	492,585		3.8	(7.2)
Total consumer loans	3,525,396		23.7	3,271,117		25.4	7.8
Total loans	$	14,933,658	100.0	$	12,840,330	100.0	16.3

N/M – Not meaningful.

Loan growth was positively impacted by the PPP loan program in the second quarter of 2020, which added $1.2 billion as of June 30, 2020, as well as loans acquired in the Park Bank acquisition in the first quarter of 2020, which totaled $726.2 million as of June 30, 2020. Excluding these loans, total loans grew 2.9% annualized from December 31, 2019. In addition, total corporate loans benefited from growth in commercial and industrial loans as a result of both new production and existing line draws, primarily within our sector-based lending businesses. Overall, corporate loans, excluding PPP loans, were impacted by lower production and line usage and higher paydowns due to current economic conditions as a result of the ongoing pandemic. Growth in consumer loans resulted primarily from strong production and purchases of home equity loans and 1-4 family mortgages, which more than offset prepayments.

Commercial, Industrial, and Agricultural Loans

Commercial, industrial, and agricultural loans represented 34.7% of total loans, and totaled $5.2 billion at June 30, 2020, an increase of $283.5 million, or 5.8%, from December 31, 2019. Our commercial and industrial loans are a diverse group of loans generally located in the Chicago metropolitan area with purposes that include supporting working capital needs, accounts receivable financing, inventory and equipment financing, and select sector-based lending, such as healthcare, asset-based lending, structured finance, and syndications. Most commercial and industrial loans are secured by the assets being financed or other business assets, such as accounts receivable or inventory. The underlying collateral securing commercial and industrial loans may fluctuate in value due to the success of the business or economic conditions. For loans secured by accounts receivable, the availability of funds for repayment and economic conditions may impact the cash flow of the borrower. Accordingly, the underwriting for these loans is based primarily on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower and may incorporate a personal guarantee.

Agricultural loans are generally provided to meet seasonal production, equipment, and farm real estate borrowing needs of individual and corporate crop and livestock producers. Seasonal crop production loans are repaid by the liquidation of the financed crop that is typically covered by crop insurance. Equipment and real estate term loans are repaid through cash flows of the farming operation. Risks uniquely inherent in agricultural loans relate to weather conditions, agricultural product pricing, and loss of crops or livestock due to disease or other factors. Therefore, as part of the underwriting process, the Company examines projected future cash flows, financial statement stability, and the value of the underlying collateral.

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Commercial Real Estate Loans

Commercial real estate loans are subject to underwriting standards and processes similar to commercial and industrial loans. The repayment of commercial real estate loans depends on the successful operation of the property securing the loan or the business conducted on the property securing the loan. This category of loans may be more adversely affected by conditions in real estate markets. In addition, many commercial real estate loans do not fully amortize over the term of the loan but have balloon payments due at maturity. The borrower's ability to make a balloon payment may depend on the availability of long-term financing or their ability to complete a timely sale of the underlying property. Management monitors and evaluates commercial real estate loans based on cash flow, collateral, geography, and risk rating criteria.

Construction loans are generally made based on estimates of costs and values associated with the completed projects and are underwritten utilizing feasibility studies, independent appraisal reviews, sensitivity analyses of absorption and lease rates, and financial analyses of the developers and property owners. Sources of repayment may be permanent long-term financing, sales of developed property, or an interim loan commitment until permanent financing is obtained. Generally, construction loans have a higher risk profile than other real estate loans since repayment is impacted by real estate values, interest rate changes, governmental regulation of real property, demand and supply of alternative real estate, the availability of long-term financing, and changes in general economic conditions.

The following table presents commercial real estate loan detail as of June 30, 2020 and December 31, 2019.

Table 10

Commercial Real Estate Loans

(Dollar amounts in thousands)

	As of    June 30, 2020		% of Total	As of    December 31, 2019		% of Total
Office, retail, and industrial:
Office	$	710,177	14.0	$	643,575	13.7
Retail	620,199		12.3	607,712		13.0
Industrial	689,942		13.6	597,431		12.8
Total office, retail, and industrial	2,020,318		39.9	1,848,718		39.5
Multi-family	874,861		17.3	856,553		18.3
Construction	687,063		13.6	593,093		12.7
Other commercial real estate:
Multi-use properties	344,377		6.8	300,488		6.4
Rental properties	316,398		6.3	277,350		5.9
Warehouses and storage	193,453		3.8	166,750		3.6
Hotels	110,891		2.2	127,213		2.7
Service stations and truck stops	110,111		2.2	114,205		2.4
Restaurants	107,283		2.1	102,341		2.2
Recreational	96,398		1.9	89,246		1.9
Other	197,026		3.9	206,115		4.4
Total other commercial real estate	1,475,937		29.2	1,383,708		29.5
Total commercial real estate	$	5,058,179	100.0	$	4,682,072	100.0

Commercial real estate loans represent 33.8% of total loans, and totaled $5.1 billion at June 30, 2020, increasing $376.1 million, or 8.0%, from December 31, 2019.

The mix of properties securing the loans in our commercial real estate portfolio is balanced between owner-occupied and investor categories and is diverse in terms of type and geographic location, generally within the Company's markets. Approximately 47% of the commercial real estate portfolio, excluding multi-family and construction loans, is owner-occupied as of June 30, 2020. Using outstanding loan balances, non-owner-occupied commercial real estate loans to total capital was 179% and construction loans to total capital was 31% as of June 30, 2020. Non-owner-occupied (investor) commercial real estate is calculated in accordance with federal banking agency guidelines and includes construction, multi-family, non-farm non-residential property, and commercial real estate loans that are not secured by real estate collateral.

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As a result of the pandemic, the Company identified certain elevated risk segments in the corporate loan portfolio including franchises, recreation and entertainment, restaurants, hotels, and commercial retailers. As of June 30, 2020, these elevated risk segments approximate 5% of our granular and diverse total loan portfolio.

Consumer Loans

Consumer loans represented 23.7% of total loans, and totaled $3.5 billion at June 30, 2020, an increase of $254.3 million, or 7.8%, from December 31, 2019. Consumer loans are centrally underwritten using a credit scoring model developed by the Fair Isaac Corporation ("FICO"), which employs a risk-based system to determine the probability that a borrower may default. Underwriting standards for home equity loans are heavily influenced by statutory requirements, which include loan-to-value and affordability ratios, risk-based pricing strategies, and documentation requirements. The home equity category consists mainly of revolving lines of credit secured by junior liens on owner-occupied real estate. Loan-to-value ratios on home equity loans and 1-4 family mortgages are based on the current appraised value of the collateral. Repayment for these loans is dependent on the borrower's continued financial stability and is more likely to be impacted by adverse personal circumstances.

As a result of the pandemic, the Company identified unsecured installment loans, which was less than 2% of our total loan portfolio as of June 30, 2020, as an elevated risk segment in the consumer loan portfolio. These loans are high credit quality, geographically dispersed, and have average loan sizes of less than $9,000, which reduces our risk exposure.

Allowance for Credit Losses

Methodology for the Allowance for Credit Losses

On January 1, 2020, the Company adopted CECL, which requires the Company to present financial assets measured at amortized cost at the net amount expected to be collected considering an entity's current estimate of all expected credit losses. Prior to the adoption of CECL, the allowance for credit losses was estimated using an incurred loss model based on historical loss experience. The adoption of CECL impacted both the level of allowance for credit loss reserves as well as other asset quality metrics due to the change in accounting for acquired PCD loans. As a result, certain metrics are presented excluding PCD loans to provide comparability to prior periods.

The allowance for credit losses is comprised of the allowance for loan losses and the allowance for unfunded commitments and is maintained by management at a level believed adequate to absorb current expected credit losses inherent in the existing loan portfolio. The determination of the allowance for credit losses is inherently subjective since it requires significant estimates and management judgment, including the amounts and timing of expected future cash flows on non-accrual loans, actual loss experience, consideration of current national, regional, and local economic trends and conditions, reasonable and supportable forecasts about the future, changes in interest rates and property values, various internal and external qualitative factors, and other factors.

While management utilizes its best judgment and information available, the ultimate adequacy of the allowance for credit losses depends on a variety of factors beyond the Company's control, including the performance of its loan portfolio, the economy, changes in interest rates and property values, and the interpretation of loan risk ratings by regulatory authorities. Management believes that the allowance for credit losses is an appropriate estimate of current expected credit losses inherent in the existing loan portfolio as of June 30, 2020.

The accounting policy for the allowance for credit losses is discussed in Note 1 of "Notes to the Condensed Consolidated Financial Statements" in Part I, Item 1 of this Form 10-Q.

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Table 11

Allowance for Credit Losses and

Summary of Credit Loss Experience

(Dollar amounts in thousands)

	Quarters Ended
	June 30, 2020			March 31,   2020			December 31, 2019			September 30, 2019			June 30, 2019
Change in allowance for credit losses
Beginning balance	$	226,701		$	109,222		$	110,228		$	106,929		$	104,779
Adjustment to apply recent accounting   pronouncements(1)	—			75,757			—			—			—
Allowance established for acquired PCD loans	1,250			14,304			—			—			—
Loan charge-offs:
Commercial, industrial, and agricultural	5,673			7,066			7,865			7,176			6,516
Office, retail, and industrial	3,092			338			274			293			1,605
Multi-family	9			10			—			—			—
Construction	798			1,808			4			—			—
Other commercial real estate	31			308			77			184			329
Consumer	4,631			4,400			4,515			3,619			2,974
Total loan charge-offs	14,234			13,930			12,735			11,272			11,424
Recoveries of loan charge-offs:
Commercial, industrial, and agricultural	820			1,159			1,051			1,205			1,258
Office, retail, and industrial	6			9			18			74			151
Multi-family	—			5			439			38			—
Construction	—			—			1			2			10
Other commercial real estate	12			144			64			227			45
Consumer	473			499			562			527			619
Total recoveries of loan charge-offs	1,311			1,816			2,135			2,073			2,083
Net loan charge-offs	12,923			12,114			10,600			9,199			9,341
Provision for loan losses	32,649			39,532			9,594			12,498			11,491
Ending balance	$	247,677		$	226,701		$	109,222		$	110,228		$	106,929
Total net loan charge-offs, excluding   PCD loans(2)	$	9,090		$	10,394		$	10,600		$	9,199		$	9,341
Allowance for credit losses
Allowance for loan losses	$	240,052		$	219,948		$	108,022		$	109,028		$	105,729
Allowance for unfunded commitments	7,625			6,753			1,200			1,200			1,200
Total allowance for credit losses	$	247,677		$	226,701		$	109,222		$	110,228		$	106,929
Allowance for credit losses to loans	1.66		%	1.62		%	0.85		%	0.86		%	0.85		%
Allowance for credit losses to loans, excluding   PPP loans(3)	1.80		%	1.62		%	0.85		%	0.86		%	0.85		%
Allowance for credit losses to non-accrual loans	177.98		%	154.64		%	132.76		%	141.88		%	168.45		%
Net loan charge-offs to average loans,   annualized	0.36		%	0.37		%	0.33		%	0.29		%	0.31		%
Net loan charge-offs to average loans, excluding   PCD and PPP loans, annualized(2)(3)	0.27		%	0.32		%	0.33		%	0.29		%	0.31		%

⁽¹⁾As a result of accounting guidance adopted in the first quarter of 2020, the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

⁽²⁾Prior to the adoption of CECL on January 1, 2020, the portion of PCI loans deemed to be uncollectible was recorded as a reduction of the credit-related acquisition adjustment, which was netted within loans. Subsequent to adoption, an allowance for credit losses on PCD loans, including those previously identified as PCI, is established as of the acquisition date and the PCD loans are no longer recorded net of a credit-related acquisition adjustment. PCD loans deemed to be uncollectible are recorded as a charge-off through the allowance for credit losses. This item is a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

⁽³⁾This ratio excludes PPP loans that are expected to be forgiven. As a result, no allowance for credit losses is associated with these loans. See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.

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Activity in the Allowance for Credit Losses

The allowance for credit losses was $247.7 million or 1.66% of total loans as of June 30, 2020, increasing $137.4 million and $140.7 million compared to December 31, 2019 and June 30, 2019, respectively. Excluding the impact of PPP loans, allowance for credit losses to total loans was 1.80% as of June 30, 2020. Adoption of the CECL standard on January 1, 2020 increased the allowance for credit losses by $75.8 million, which includes $31.6 million attributable to loans and unfunded commitments, $35.7 million for PCD acquired loans, and $8.5 million for non-PCD acquired loans. As a result of the pandemic, a provision for loan losses of $28.0 million and $25.0 million was recorded in the first and second quarters of 2020, respectively. In addition, $14.3 million in allowance for credit losses was established through acquisition accounting adjustments for PCD loans acquired in the Park Bank acquisition in the first quarter of 2020 along with an additional $1.7 million in provision for loan losses on non-PCD loans subsequent to acquisition.

The provision for loan losses was $32.6 million for the quarter ended June 30, 2020, up from $9.6 million for the quarter ended December 31, 2019 and from $11.5 million for the quarter ended June 30, 2019. The increase compared to both prior periods was driven primarily by a provision for loan losses of $25.0 million recorded as a result of the estimated impact of the pandemic.

Net loan charge-offs to average loans, annualized, were 0.36%, or $12.9 million, for the second quarter of 2020, compared to 0.29% for the fourth quarter of 2019 and 0.31% for the second quarter of 2019. Excluding charge-offs on PCD loans, net loan charge-offs to average loans of 0.27% was lower than both prior periods.

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Non-performing Assets and Corporate Performing Potential Problem Loans

The following table presents our loan portfolio by performing and non-performing status. A discussion of our accounting policies for non-accrual loans, TDRs, and loans 90 days or more past due can be found in Note 1 of "Notes to the Condensed Consolidated Financial Statements" in Part 1, Item 1 of this Form 10-Q.

Table 12

Loan Portfolio by Performing/Non-performing Status ⁽¹⁾

(Dollar amounts in thousands)

	Accruing
	Current		30-89 Days Past Due		90 Days Past Due		Non-accrual		Total Loans
As of June 30, 2020
Commercial and industrial	$	4,740,392	$	19,725	$	1,090	$	28,349	$	4,789,556
Agricultural	372,630		—		—		8,494		381,124
Commercial real estate:
Office, retail, and industrial	1,981,444		2,363		596		35,915		2,020,318
Multi-family	870,202		1,538		—		3,121		874,861
Construction	658,892		801		88		27,282		687,063
Other commercial real estate	1,452,885		4,655		25		18,372		1,475,937
Total commercial real estate	4,963,423		9,357		709		84,690		5,058,179
Total corporate loans, excluding PPP loans	10,076,445		29,082		1,799		121,533		10,228,859
PPP loans	1,179,403		—		—		—		1,179,403
Total corporate loans	11,255,848		29,082		1,799		121,533		11,408,262
Home equity	881,540		2,011		187		9,129		892,867
1-4 family mortgages	2,162,531		4,293		—		8,498		2,175,322
Installment	454,996		956		1,255		—		457,207
Total consumer loans	3,499,067		7,260		1,442		17,627		3,525,396
Total loans	$	14,754,915	$	36,342	$	3,241	$	139,160	$	14,933,658
As of December 31, 2019
Commercial and industrial	$	4,438,063	$	11,260	$	2,207	$	29,995	$	4,481,525
Agricultural	398,676		628		358		5,954		405,616
Commercial real estate:
Office, retail, and industrial	1,820,502		1,813		546		25,857		1,848,718
Multi-family	853,762		94		—		2,697		856,553
Construction	588,065		4,876		—		152		593,093
Other commercial real estate	1,375,712		2,738		529		4,729		1,383,708
Total commercial real estate	4,638,041		9,521		1,075		33,435		4,682,072
Total corporate loans	9,474,780		21,409		3,640		69,384		9,569,213
Home equity	838,575		4,290		146		8,443		851,454
1-4 family mortgages	1,916,341		5,092		1,203		4,442		1,927,078
Installment	491,406		1,167		12		—		492,585
Total consumer loans	3,246,322		10,549		1,361		12,885		3,271,117
Total loans	$	12,721,102	$	31,958	$	5,001	$	82,269	$	12,840,330

⁽¹⁾ Prior to the adoption of CECL on January 1, 2020, PCI loans with an accretable yield were considered current and were not included in past due loan totals. In addition, PCI loans with an accretable yield were excluded from non-accrual loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals. In addition, an allowance for credit losses is established as of the acquisition date or upon the adoption of CECL for loans previously classified as PCI, as PCD loans are no longer recorded net of a credit-related acquisition adjustment.

60

The following table provides a comparison of our non-performing assets and past due loans to prior periods.

Table 13

Non-Performing Assets and Past Due Loans

(Dollar amounts in thousands)

	As of
	June 30, 2020			March 31, 2020			December 31, 2019			September 30, 2019			June 30, 2019
Non-accrual loans, excluding PCD   loans(1)(2)	$	94,044		$	97,649		$	82,269		$	77,692		$	63,477
Non-accrual PCD loans(1)	45,116			48,950			—			—			—
Total non-accrual loans	139,160			146,599			82,269			77,692			63,477
90 days or more past due loans, still   accruing interest(1)	3,241			5,052			5,001			4,657			2,615
Total non-performing loans	142,401			151,651			87,270			82,349			66,092
Accruing TDRs	1,201			1,216			1,233			1,422			1,441
Foreclosed assets(3)	19,024			21,027			20,458			25,266			28,488
Total non-performing assets	$	162,626		$	173,894		$	108,961		$	109,037		$	96,021
30-89 days past due loans(1)	$	36,342		$	81,127		$	31,958		$	46,171		$	34,460
30-89 days past due loans, excluding PCD   loans(1)(2)	$	34,872		$	75,581		$	31,958		$	46,171		$	34,460
Non-accrual loans to total loans:
Non-accrual loans to total loans	0.93		%	1.05		%	0.64		%	0.61		%	0.51		%
Non-accrual loans to total loans, excluding   PPP loans(1)(2)(4)	1.01		%	1.05		%	0.64		%	0.61		%	0.51		%
Non-accrual loans to total loans, excluding   PCD and PPP loans(1)(2)(4)	0.70		%	0.71		%	0.64		%	0.61		%	0.51		%
Non-performing loans to total loans:
NPLs to total loans	0.95		%	1.09		%	0.68		%	0.64		%	0.53		%
NPLs to total loans, excluding PPP   loans(1)(2)(4)	1.04		%	1.09		%	0.68		%	0.64		%	0.53		%
NPLs to total loans, excluding PCD and   PPP loans(1)(2)(4)	0.72		%	0.75		%	0.68		%	0.64		%	0.53		%
Non-performing assets to total loans plus foreclosed assets:
NPAs to total loans plus foreclosed assets	1.09		%	1.24		%	0.85		%	0.85		%	0.77		%
NPAs to total loans plus foreclosed assets,   excluding PPP loans(1)(2)(4)	1.18		%	1.24		%	0.85		%	0.85		%	0.77		%
NPAs to total loans plus foreclosed assets,   excluding PCD and PPP loans(1)(2)(4)	0.87		%	0.91		%	0.85		%	0.85		%	0.77		%

⁽¹⁾Prior to the adoption of CECL on January 1, 2020, PCI loans with an accretable yield were considered current and were not included in past due loan totals. In addition, PCI loans with an accretable yield were excluded from non-accrual loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals. In addition, an allowance for credit losses is established as of the acquisition date or upon the adoption of CECL for loans previously classified as PCI, as PCD loans are no longer recorded net of a credit-related acquisition adjustment.

⁽²⁾This item is a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

⁽³⁾Foreclosed assets consists of OREO and other foreclosed assets acquired in partial or total satisfaction of defaulted loans. Other foreclosed assets are included in other assets in the Consolidated Statements of Financial Condition.

⁽⁴⁾This ratio excludes PPP loans that are expected to be forgiven. As a result, no allowance for credit losses is associated with these loans. See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.

Total non-performing assets represented 1.09% of total loans and foreclosed assets at June 30, 2020, compared to 0.85% and 0.77% at December 31, 2019 and June 30, 2019, respectively. Excluding the impact of PCD and PPP loans, non-performing assets to total loans plus foreclosed assets was 0.87% at June 30, 2020, consistent with December 31, 2019 and up 10 basis points from June 30, 2019, reflective of normal fluctuations that occur on a quarterly basis. These fluctuations occurred within non-accrual loans and are isolated to certain credits for which the Company has remediation plans in place.

61

Total 30-89 days past due loans, excluding PCD loans of $34.9 million were consistent with December 31, 2019 and June 30, 2019.

TDRs

Loan modifications may be performed at the request of an individual borrower and may include reductions in interest rates, changes in payments, and extensions of maturity dates. We occasionally restructure loans at other than market rates or terms to enable the borrower to work through financial difficulties for a period of time, and these restructured loans remain classified as TDRs for the remaining term of these loans.

Table 14

TDRs by Type

(Dollar amounts in thousands)

	As of
	June 30, 2020			December 31, 2019			June 30, 2019
	Number of Loans	Amount		Number of Loans	Amount		Number of Loans	Amount
Commercial and industrial	7	$	9,524	9	$	16,647	5	$	7,164
Commercial real estate:
Office, retail, and industrial	1	2,340		1	3,600		1	383
Multi-family	1	160		1	163		1	167
Other commercial real estate	2	198		1	170		1	176
Total commercial real estate	4	2,698		3	3,933		3	726
Total corporate loans	11	12,222		12	20,580		8	7,890
Home equity	7	210		8	276		9	366
1-4 family mortgages	9	862		6	637		11	1,026
Installment	—	—		4	254		—	—
Total consumer loans	16	1,072		18	1,167		20	1,392
Total TDRs	27	$	13,294	30	$	21,747	28	$	9,282
Accruing TDRs	12	$	1,201	12	$	1,233	14	$	1,441
Non-accrual TDRs	15	12,093		18	20,514		14	7,841
Total TDRs	27	$	13,294	30	$	21,747	28	$	9,282
Year-to-date charge-offs on TDRs		$	6,102		$	3,557		$	628
Specific allowances related to TDRs		2,385			2,245			670

In March of 2020, the CARES Act was enacted by the U.S. government in response to the economic disruption caused by the pandemic. The Company's banking regulators issued a statement titled the "Interagency Statement on Loan Modifications by Financial Institutions Working with Customers Affected by the Coronavirus" that encourages financial institutions to work prudently with borrowers who are or may be unable to meet their contractual payment obligations due to the effects of the pandemic. Additionally, the CARES Act provides that a qualified loan modification is exempt by law from classification as a TDR as defined by GAAP, from the period beginning March 1, 2020 until the earlier of December 31, 2020 or the date that is 60 days after the date on which the national emergency concerning the pandemic declared by the President of the United States terminates. Accordingly, we are offering short-term modifications made in response to the pandemic to borrowers who are current and otherwise not past due. These include short-term modifications in the form of payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. The total balance of loans with eligible modifications as of June 30, 2020 was $1.9 billion.

62

Adverse Loans

Adverse loans consist of corporate special mention loans and substandard loans, excluding accruing TDRs. These loans are performing in accordance with their contractual terms, but we have concerns about the ability of the borrower to continue to comply with loan terms due to the borrower's operating or financial difficulties.

Table 15

Adverse Loans

(Dollar amounts in thousands)

	As of June 30, 2020									As of December 31, 2019
	Special Mention(1)			Substandard(2)			Total(3)			Special Mention(1)			Substandard(2)			Total(3)
Commercial and industrial	$	131,677		$	92,349		$	224,026		$	47,665		$	78,929		$	126,594
Agricultural	21,154			22,373			43,527			32,764			16,071			48,835
Commercial real estate	103,542			78,615			182,157			108,274			93,811			202,085
Total adverse loans(4)	256,373			193,337			449,710			188,703			188,811			377,514
PCD and PCI adverse loans   included in the totals above(4)	(48,028)			(29,870)			(77,898)			(21,892)			(46,207)			(68,099)
Adverse loans to corporate loans	2.25		%	1.69		%	3.94		%	1.97		%	1.97		%	3.95		%
Adverse loans, excluding PPP   loans to corporate loans(5)(6)	2.51		%	1.89		%	4.40		%	1.97		%	1.97		%	3.95		%

⁽¹⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽²⁾Loans categorized as substandard exhibit well-defined weaknesses that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured, and collection of principal and interest is expected within a reasonable time.

⁽³⁾Total adverse loans excludes accruing TDRs.

⁽⁴⁾Includes PCD adverse loans, subsequent to the adoption of CECL on January 1, 2020. Prior to the adoption of CECL, included PCI adverse loans.

⁽⁵⁾This ratio excludes PPP loans that are expected to be forgiven. As a result, no allowance for credit losses is associated with these loans.

⁽⁶⁾This item is a non-GAAP financial measure. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

Adverse loans to corporate loans was 3.94% at June 30, 2020. Excluding the impact of PPP loans on this metric, adverse loans to corporate loans was 4.40% compared to 3.95% at December 31, 2019. The increase resulted primarily from higher levels of commercial and industrial loans classified as special mention and substandard. Management has specific monitoring and remediation plans associated with these loans. The increase in PCD and PCI adverse loans was driven primarily by loans acquired in the Park Bank transaction, partially offset by the transition of certain loans previously classified as PCI to non-accrual PCD status upon adoption of CECL.

63

Foreclosed Assets

Foreclosed assets consists of OREO and other foreclosed assets acquired in partial or total satisfaction of defaulted loans.

Table 16

Foreclosed Assets by Type

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019		June 30, 2019
Single-family homes	$	1,639	$	1,636	$	3,671
Land parcels:
Raw land	—		—		—
Commercial lots	4,253		5,178		6,086
Single-family lots	1,543		1,543		2,190
Total land parcels	5,796		6,721		8,276
Multi-family units	117		—		139
Commercial properties	2,395		393		3,227
Total OREO	9,947		8,750		15,313
Other foreclosed assets(1)	9,077		11,708		13,175
Total	$	19,024	$	20,458	$	28,488

⁽¹⁾Other foreclosed assets are included in other assets in the Consolidated Statements of Financial Condition.

Other foreclosed assets as of June 30, 2020 includes one corporate loan relationship for which the Company has remediation plans in place.

A rollforward of foreclosed assets balances for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

Table 17

Foreclosed Assets Rollforward

(Dollar amounts in thousands)

	Quarters Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Beginning balance	$	21,027	$	10,818	$	20,458	$	12,821
Transfers from loans	—		13,497		121		13,497
Acquisitions	133		6,237		2,001		6,237
Acquisition accounting adjustment	—		—		(567)		—
Proceeds from sales	(328)		(2,441)		(1,053)		(5,236)
Gains on sales of foreclosed assets	—		246		142		353
Valuation adjustments	(1,808)		131		(2,078)		816
Ending balance	$	19,024	$	28,488	$	19,024	$	28,488

64

FUNDING AND LIQUIDITY MANAGEMENT

The following table provides a comparison of average funding sources. We believe that average balances, rather than period-end balances, are more meaningful in analyzing funding sources because of the normal fluctuations that may occur on a daily or monthly basis within funding categories.

Table 18

Funding Sources – Average Balances

(Dollar amounts in thousands)

	Quarters Ended									June 30, 2020 % Change From
	June 30, 2020			December 31, 2019			June 30, 2019			December 31, 2019	June 30, 2019
Demand deposits	$	5,305,109		$	3,862,157		$	3,835,567		37.4	38.3
Savings deposits	2,246,643			2,044,386			2,079,852			9.9	8.0
NOW accounts	2,549,088			2,291,667			2,261,103			11.2	12.7
Money market accounts	2,663,622			2,178,518			1,907,766			22.3	39.6
Core deposits	12,764,462			10,376,728			10,084,288			23.0	26.6
Time deposits	2,431,312			2,792,343			2,707,950			(12.9)	(10.2)
Brokered deposits	108,684			241,560			141,980			(55.0)	(23.5)
Total time deposits	2,539,996			3,033,903			2,849,930			(16.3)	(10.9)
Total deposits	15,304,458			13,410,631			12,934,218			14.1	18.3
Securities sold under agreements to   repurchase	130,122			97,843			107,751			33.0	20.8
Federal funds purchased	68,057			114,180			26,263			(40.4)	159.1
FHLB advances	2,268,121			1,347,303			891,337			68.3	154.5
Total borrowed funds	2,466,300			1,559,326			1,025,351			58.2	140.5
Senior and subordinated debt	234,259			233,848			220,756			0.2	6.1
Total funding sources	$	18,005,017		$	15,203,805		$	14,180,325		18.4	27.0
Average interest rate paid on   borrowed funds	0.51		%	1.17		%	1.74		%
Weighted-average maturity of FHLB   advances	60.4 months			52.4 months			19.0 months
Weighted-average interest rate of   FHLB advances	0.76		%	1.34		%	2.23		%

Total average funding sources for the second quarter of 2020 increased $2.8 billion, or 18.4% from the fourth quarter of 2019 and $3.8 billion, or 27.0%, compared to the second quarter of 2019. The increase in total average funding sources compared to both prior periods resulted primarily from the Park Bank transaction in the first quarter of 2020, FHLB advances, and higher customer balances resulting from PPP loan funds and other government stimulus. In addition, the rise in average funding sources compared to the second quarter of 2019 was impacted by deposits assumed in the Bridgeview transactions. The increase in the weighted-average maturity of FHLB advances compared to June 30, 2019 was driven by the addition of putable FHLB advances during the first six months of 2020 that mature between April of 2020 and March of 2030.

As of June 30, 2020, the Company had $7.5 billion of additional funding sources to provide ample capacity to support its clients, colleagues, and communities, with $4.2 billion of the additional funding comprised of $2.4 billion of unencumbered securities and cash, $807.0 million of Federal Reserve availability, and $1.0 billion of available FHLB capacity. In addition, the Company has the ability to utilize the Paycheck Protection Program Liquidity Facility ("PPPLF") to fund PPP demand for loans. As of June 30, 2020, no amount was outstanding under the PPPLF.

65

Table 19

Borrowed Funds

(Dollar amounts in thousands)

	June 30, 2020			June 30, 2019
	Amount		Weighted- Average Rate (%)	Amount		Weighted- Average Rate (%)
At period-end:
Securities sold under agreements to repurchase	$	130,667	0.05	$	97,378	0.09
Federal funds purchased	200,000		0.05	—		—
FHLB advances	1,974,528		0.76	1,310,000		2.23
Total borrowed funds	$	2,305,195	0.65	$	1,407,378	2.08
Average for the year-to-date period:
Securities sold under agreements to repurchase	$	117,255	0.11	$	110,220	0.08
Federal funds purchased	163,178		1.09	13,564		2.51
FHLB advances	1,956,567		0.83	828,296		1.90
Total borrowed funds	$	2,237,000	0.81	$	952,080	1.70
Maximum amount outstanding at the end of any day during the period:
Securities sold under agreements to repurchase	$	159,751		$	122,441
Federal funds purchased	400,000			295,000
FHLB advances	2,420,528			1,310,000

Average borrowed funds totaled $2.2 billion for the second quarter of 2020, increasing by $1.3 billion compared to the same period in 2019. This increase was due primarily to higher levels of FHLB advances and federal funds purchased. The weighted-average rate on borrowed funds for both periods presented was impacted by the hedging of $1.1 billion and $685.0 million of borrowed funds as of June 30, 2020 and 2019, respectively, using interest rate swaps through which the Company receives variable amounts and pays fixed amounts. The weighted-average interest rate paid on these interest rate swaps was 1.00% and 1.92% as of June 30, 2020 and 2019, respectively. For a detailed discussion of interest rate swaps, see Note 12 of "Notes to the Condensed Consolidated Financial Statements" in Part I, Item 1 of this Form 10-Q.

The Company has a loan agreement with U.S. Bank National Association providing for a $50.0 million short-term, unsecured revolving credit facility that matures on September 26, 2020. Advances will bear interest at a rate equal to one-month LIBOR plus 1.75%, adjusted on a monthly basis, and the Company must pay an unused facility fee equal to 0.35% per annum on a quarterly basis. As of June 30, 2020, no amount was outstanding under the facility.

We make interchangeable use of repurchase agreements, FHLB advances, and federal funds purchased to supplement deposits. Securities sold under agreements to repurchase generally mature within 1 to 90 days from the transaction date.

MANAGEMENT OF CAPITAL

Capital Measurements

A strong capital structure is required under applicable banking regulations and is crucial in maintaining investor confidence, accessing capital markets, and enabling us to take advantage of future growth opportunities. Our capital policy requires that the Company and the Bank maintain capital ratios in excess of the minimum regulatory guidelines. It serves as an internal discipline in analyzing business risks and internal growth opportunities and sets targeted levels of return on equity. Under regulatory capital adequacy guidelines, the Company and the Bank are subject to various capital requirements set and administered by the federal banking agencies. The Company and the Bank are subject to the Basel III Capital rules, a comprehensive capital framework for U.S. banking organizations published by the Federal Reserve. These rules are discussed in the "Supervision and Regulation" section in Item 1, "Business" in the Company's 2019 10-K.

The following table presents the Company's and the Bank's measures of capital as of the dates presented and the capital guidelines established by the Federal Reserve for the Company and the Bank. We manage our capital levels for both the Company and the Bank to consistently maintain these measurements in excess of the Federal Reserve's minimum levels. All regulatory mandated ratios for characterization of the Bank as "well-capitalized" were exceeded as of June 30, 2020 and December 31, 2019.

66

Table 20

Capital Measurements

(Dollar amounts in thousands)

					As of June 30, 2020
					Minimum Requirement Plus Capital Conservation Buffer				Well-Capitalized(1)
	As of				Minimum		Excess Over Minimums		Minimum		Excess Over Minimums
	June 30,   2020		December 31, 2019
Bank regulatory capital ratios
Total capital to risk-weighted assets	11.12	%	11.28	%	10.50	%	$	95,407	10.00	%	$	172,513
Tier 1 capital to risk-weighted assets	10.15	%	10.51	%	8.50	%	$	253,914	8.00	%	$	331,020
CET1 to risk-weighted assets	10.15	%	10.51	%	7.00	%	$	485,232	6.50	%	$	562,338
Tier 1 capital to average assets	8.24	%	8.79	%	4.00	%	$	804,735	5.00	%	$	614,740
Company regulatory capital ratios
Total capital to risk-weighted assets	13.70	%	12.96	%	10.50	%	$	495,182	10.00	%	$	572,474
Tier 1 capital to risk-weighted assets	11.19	%	10.52	%	8.50	%	$	415,927	6.00	%	$	802,386
CET1 to risk-weighted assets	9.70	%	10.52	%	7.00	%	$	417,940	N/A		N/A
Tier 1 capital to average assets	8.70	%	8.81	%	4.00	%	$	704,664	N/A		N/A
Company tangible common equity ratios(2)(3)
Tangible common equity to tangible assets	7.32	%	8.81	%	N/A		N/A		N/A		N/A
Tangible common equity to tangible assets, excluding PPP loans	7.77	%	8.81	%	N/A		N/A		N/A		N/A
Tangible common equity, excluding accumulated other comprehensive income (loss), to tangible assets	7.17	%	8.82	%	N/A		N/A		N/A		N/A
Tangible common equity, excluding accumulated other comprehensive income (loss), to tangible assets, excluding PPP loans	7.62	%	8.82	%	N/A		N/A		N/A		N/A
Tangible common equity to risk-weighted assets	9.61	%	10.51	%	N/A		N/A		N/A		N/A

N/A – Not applicable.

⁽¹⁾"Well-capitalized" minimum CET1 to risk-weighted assets and Tier 1 capital to average assets ratios are not formally defined under applicable banking regulations for bank holding companies.

⁽²⁾Ratios are not subject to formal Federal Reserve regulatory guidance.

⁽³⁾Tangible common equity ratios are non-GAAP financial measures. For a discussion of non-GAAP financial measures, see the section of this Item 2 titled "Non-GAAP Financial Information and Reconciliations."

Total and Tier 1 capital ratios increased compared to December 31, 2019 as earnings and the issuance of preferred stock more than offset the impact of loan growth and securities purchases on risk-weighted assets. In addition, all capital ratios were impacted by the approximately 50 basis point decrease due to the Park Bank acquisition, and 15 basis point decrease due to stock repurchases in the first quarter of 2020. The Company elected CECL transition relief for regulatory capital which retained approximately 25 basis points of CET1 and Tier 1 capital as of June 30, 2020.

In February of 2019, the federal bank regulatory agencies issued a final rule, the 2019 CECL Rule, that revised certain capital regulations to account for changes to credit loss accounting under U.S. GAAP. The 2019 CECL Rule included a transition option that allows banking organizations to phase in, over a three-year period, the day-one adverse effects of CECL on their regulatory capital ratios (three-year transition option). In March of 2020, the federal bank regulatory agencies issued an interim final rule that maintains the three year transition option of the 2019 CECL Rule and also provides banking organizations that were required under GAAP (as of January 2020) to implement CECL before the end of 2020 the option to delay for two years an estimate of the effect of CECL on regulatory capital, relative to the incurred loss methodology's effect on regulatory capital, followed by a three-year transition period (five-year transition option). The Company elected to adopt the five-year transition option, which retained approximately 25 basis points of CET1 and Tier 1 capital as of June 30, 2020. This election of the transition option is applicable only to regulatory capital computations under federal banking regulations and does not otherwise impact the financial statements prepared in accord with GAAP.

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The Company's Board of Directors (the "Board") reviews the Company's capital plan each quarter, considering the current and expected operating environment as well as evaluating various capital alternatives.

Issuance of Preferred Stock

During the second quarter of 2020, the Company issued 4.3 million depositary shares, each representing a 1/40th interest in a share of the Company's 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, and 4.9 million depositary shares, each representing a 1/40th interest in a share of the Company's Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, for an aggregate of $230.5 million. The Company received proceeds of $221.3 million, net of underwriting discounts and commissions and issuance costs and expects to use the proceeds for general corporate purposes.

Stock Repurchase Program

On February 26, 2020, the Company announced a new stock repurchase program authorizing the discretionary repurchase of up to $200 million of its common stock. This program replaced the Company's prior $180 million stock repurchase program, which was set to expire in March 2020. The Company suspended repurchases in March as it shifted its capital deployment strategy in response to the pandemic. Prior to the suspension, the Company repurchased 1.2 million shares of its common stock at a total cost of $22.6 million during the six months ended June 30, 2020.

Dividends

The Board approved a quarterly cash dividend of $0.14 per common share during the second quarter of 2020, which is consistent with the first quarter of 2020 and second quarter of 2019. This dividend represents the 150^th consecutive cash dividend paid by the Company since its inception in 1983.

NON-GAAP FINANCIAL INFORMATION AND RECONCILIATIONS

The Company's accounting and reporting policies conform to GAAP and general practices within the banking industry. As a supplement to GAAP, the Company provides non-GAAP performance results, which the Company believes are useful because they assist investors in assessing the Company's operating performance. These non-GAAP financial measures include earnings per share ("EPS"), adjusted, the efficiency ratio, return on average assets, adjusted, tax-equivalent net interest income (including its individual components), tax-equivalent net interest margin, tax-equivalent net interest margin, adjusted, noninterest expense, adjusted, return on average common equity, adjusted, tangible common equity to tangible assets, tangible common equity, excluding accumulated other comprehensive income (loss) ("AOCI"), to tangible assets, tangible common equity to risk-weighted assets, return on average tangible common equity, return on average tangible common equity, adjusted, non-accrual loans, excluding PCD loans, 30-89 days past due loans, excluding PCD loans, non-accrual loans to total loans, excluding PPP loans, non-accrual loans to total loans, excluding PCD and PPP loans, non-performing loans to total loans, excluding PPP loans, non-performing loans to total loans, excluding PCD and PPP loans, non-performing assets to total loans plus foreclosed assets, excluding PPP loans, non-performing assets to total loans plus foreclosed assets, excluding PCD and PPP loans, net loan charge-offs, excluding PCD loans, and net loan charge-offs to average loans, excluding PPP loans, net loan charge-offs to average loans, excluding PCD and PPP loans., excluding PCD loans, adverse loans to average corporate loans, excluding PPP loans, and adverse loans to average corporate loans, excluding PCD and PCI loans.

The Company presents its EPS, efficiency ratio, return on average assets, return on average common equity, and return on average tangible common equity, all adjusted for certain significant transactions. These transactions include Delivering Excellence implementation costs (six months ended June 30, 2019), net securities losses (six months ended June 30, 2020), and acquisition and integration related expenses associated with completed and pending acquisitions (all periods). In addition, net OREO expense is excluded from the calculation of the efficiency ratio. Management believes excluding these transactions from our EPS, efficiency ratio, return on average assets, return on average common equity, and return on average tangible common equity may be useful in assessing the Company's underlying operational performance since these transactions do not pertain to its core business operations and their exclusion may facilitate better comparability between periods. Management believes that excluding acquisition and integration related expenses from these metrics may be useful to the Company, as well as analysts and investors, since these expenses can vary significantly based on the size, type, and structure of each acquisition. Additionally, management believes excluding these transactions from these metrics may enhance comparability for peer comparison purposes.

The Company presents noninterest expense, adjusted, which excludes Delivering Excellence implementation costs and acquisition and integration related expenses. Management believes that excluding these items from noninterest expense may be useful in assessing the Company's underlying operational performance as these items either do not pertain to its core business operations or their exclusion may facilitate better comparability between periods and for peer comparison purposes.

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The tax-equivalent adjustment to net interest income and net interest margin recognizes the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes. In addition, management believes that presenting tax-equivalent net interest margin, adjusted, may enhance comparability for peer comparison purposes and may be useful to the Company, as well as analysts and investors, since acquired loan accretion income may fluctuate based on the size of each acquisition, as well as from period to period.

In management's view, tangible common equity measures are capital adequacy metrics that may be meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with peers. These non-GAAP measures are valuable indicators of a financial institution's capital strength since they eliminate intangible assets from stockholders' equity and retain the effect of accumulated other comprehensive income (loss) in stockholders' equity.

The Company presents non-accrual loans, 30-89 days past due loans, non-accrual loans to total loans, non-performing loans to total loans, non-performing assets to total loans plus foreclosed assets, net loan charge-offs, net loan charge-offs to average loans, and CPPPLs to average corporate loans, all excluding PCD and/or PPP loans. Management believes excluding PCD and PPP loans is useful as it facilitates better comparability between periods as prior to the adoption of CECL on January 1, 2020, PCI loans with an accretable yield were considered current and were not included in past due and non-accrual loan totals and the portion of PCI loans deemed to be uncollectible was recorded as a reduction of the credit-related acquisition adjustment, which was netted within loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals and an allowance for credit losses on PCD loans is established as of the acquisition date and the PCD loans are no longer recorded net of a credit-related acquisition adjustment. PCD loans deemed to be uncollectible are recorded as a charge-off through the allowance for credit losses. The Company began originating PPP loans during the second quarter of 2020 and the loans are expected to be forgiven by the Small Business Administration ("SBA") if the applicable criteria are met. Additionally, management believes excluding PCD loans from these metrics may enhance comparability for peer comparison purposes.

Although intended to enhance investors' understanding of the Company's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. In addition, these non-GAAP financial measures may differ from those used by other financial institutions to assess their business and performance. See the previously provided tables and the following reconciliations for details on the calculation of these measures to the extent presented herein.

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Non-GAAP Reconciliations

(Amounts in thousands, except per share data)

	Quarters Ended   June 30,						Six Months Ended   June 30,
	2020			2019			2020			2019
EPS
Net income	$	19,064		$	47,014		$	38,670		$	93,072
Preferred dividends	(1,037)			—			(1,037)			—
Net income applicable to non-vested restricted shares	(187)			(389)			(379)			(792)
Net income applicable to common shares	17,840			46,625			37,254			92,280
Adjustments to net income:
Acquisition and integration related expenses	5,249			9,514			10,721			13,205
Tax effect of acquisition and integration related expenses	(1,312)			(2,379)			(2,680)			(3,301)
Net securities losses	—			—			1,005			—
Tax effect of net securities losses	—			—			(251)			—
Delivering Excellence implementation costs	—			442			—			700
Tax effect of Delivering Excellence implementation costs	—			(111)			—			(175)
Total adjustments to net income, net of tax	3,937			7,466			8,795			10,429
Net income applicable to common shares, adjusted	$	21,777		$	54,091		$	46,049		$	102,709
Weighted-average common shares outstanding:
Weighted-average common shares outstanding (basic)	113,145			108,467			111,533			107,126
Dilutive effect of common stock equivalents	191			—			339			—
Weighted-average diluted common shares outstanding	113,336			108,467			111,872			107,126
Basic EPS	$	0.16		$	0.43		$	0.33		$	0.86
Diluted EPS	$	0.16		$	0.43		$	0.33		$	0.86
Diluted EPS, adjusted	$	0.19		$	0.50		$	0.41		$	0.96
Return on Average Assets
Net income	$	19,064		$	47,014		$	38,670		$	93,072
Total adjustments to net income, net of tax(1)	3,937			7,466			8,795			10,429
Net income, adjusted	$	23,001		$	54,480		$	47,465		$	103,501
Average assets	$	20,868,106		$	16,740,050		$	19,636,463		$	16,206,906
Return on average assets(2)(3)	0.37		%	1.13		%	0.40		%	1.16		%
Return on average assets, adjusted(1)(2)(3)	0.44		%	1.31		%	0.49		%	1.29		%
Note: Non-GAAP Reconciliations footnotes are located at the end of this section.

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	Quarters Ended   June 30,						Six Months Ended   June 30,
	2020			2019			2020			2019
Return on Average Common and Tangible Common Equity
Net income applicable to common shares	$	17,840		$	46,625		$	37,254		$	92,280
Intangibles amortization	2,820			2,624			5,590			4,987
Tax effect of intangibles amortization	(705)			(656)			(1,398)			(1,247)
Net income applicable to common shares, excluding intangibles amortization	19,955			48,593			41,446			96,020
Total adjustments to net income, net of tax(1)	3,937			7,466			8,795			10,429
Net income applicable to common shares, excluding   intangibles amortization, adjusted(1)	$	23,892		$	56,059		$	50,241		$	106,449
Average stockholders' common equity	$	2,443,212		$	2,241,569		2,429,184			$	2,190,210
Less: average intangible assets	(934,022)			(832,263)			(910,811)			(817,915)
Average tangible common equity	$	1,509,190		$	1,409,306		$	1,518,373		$	1,372,295
Return on average common equity(2)(3)	2.94		%	8.34		%	3.08		%	8.50		%
Return on average common equity, adjusted(1)(2)(3)	3.58		%	9.68		%	3.81		%	9.46		%
Return on average tangible common equity(2)(3)	5.32		%	13.83		%	5.49		%	14.11		%
Return on average tangible common equity, adjusted(1)(2)(3)	6.37		%	15.95		%	6.65		%	15.64		%
Note: Non-GAAP Reconciliations footnotes are located at the end of this section.

	Quarters Ended   June 30,						Six Months Ended   June 30,
	2020			2019			2020			2019
Efficiency Ratio Calculation
Noninterest expense	$	120,330		$	114,142		$	237,661		$	216,252
Less:
Net OREO expense	(126)			(294)			(546)			(975)
Acquisition and integration related expenses	(5,249)			(9,514)			(10,721)			(13,205)
Delivering Excellence implementation costs	—			(442)			—			(700)
Total	$	114,955		$	103,892		$	226,394		$	201,372
Tax-equivalent net interest income(2)	$	146,389		$	151,492		$	291,117		$	291,624
Noninterest income	32,991			38,526			72,353			73,432
Less: net securities losses	—			—			1,005			—
Total	$	179,380		$	190,018		$	364,475		$	365,056
Efficiency ratio	64.08		%	54.67		%	62.12		%	55.16		%
Note: Non-GAAP Reconciliations footnotes are located at the end of this section.

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	As of
	June 30, 2020			December 31, 2019
Tangible Common Equity
Stockholders' equity	$	2,425,711		$	2,370,793
Less: goodwill and other intangible assets	(940,182)			(875,262)
Tangible common equity	1,485,529			1,495,531
Less: AOCI	(28,727)			1,954
Tangible common equity, excluding AOCI	$	1,456,802		$	1,497,485
Total assets	$	21,244,881		$	17,850,397
Less: goodwill and other intangible assets	(940,182)			(875,262)
Tangible assets	$	20,304,699		$	16,975,135
Less: PPP loans	(1,179,403)			$	—
Tangible assets	$	19,125,296		$	16,975,135
Risk-weighted assets	$	15,458,361		$	14,225,444
Tangible common equity to tangible assets	7.32		%	8.81		%
Tangible common equity to tangible assets, excluding PPP loans	7.77		%	8.81		%
Tangible common equity, excluding AOCI, to tangible assets	7.17		%	8.82		%
Tangible common equity, excluding AOCI, to tangible assets, excluding PPP loans	7.62		%	8.82		%
Tangible common equity to risk-weighted assets	9.61		%	10.51		%

Footnotes for non-GAAP reconciliations

⁽¹⁾Adjustments to net income for each period presented are detailed in the EPS non-GAAP reconciliation above.

⁽²⁾Presented on a tax-equivalent basis, assuming the federal income tax rate of 21%.

⁽³⁾Annualized based on the actual number of days for each period presented.

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ITEM 3. QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

Market risk is the risk of loss arising from adverse changes in the fair value of financial instruments due to changes in interest rates, exchange rates, and equity prices. Interest rate risk is our primary market risk and is the result of repricing, basis, and option risk. A description and analysis of our interest rate risk management policies is included in Part II, Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," in our 2019 10-K.

We seek to achieve consistent growth in net interest income and net income while managing volatility that arises from shifts in interest rates. The Bank's Asset Liability Committee ("ALCO") oversees financial risk management by developing programs to measure and manage interest rate risks within authorized limits set by the Bank's Board of Directors. ALCO also approves the Bank's asset and liability management policies, oversees the formulation and implementation of strategies to improve balance sheet positioning and earnings, and reviews the Bank's interest rate sensitivity position. Management uses net interest income simulation modeling to analyze and capture exposure of earnings to changes in interest rates.

Net Interest Income Sensitivity

The analysis of net interest income sensitivity assesses the magnitude of changes in net interest income over a twelve-month measurement period resulting from immediate changes in interest rates using multiple rate scenarios. These scenarios include, but are not limited to, a flat or unchanged rate environment, immediate increases of 100, 200, and 300 basis points, and an immediate decrease of 100 basis points.

This simulation analysis is based on expected future cash flows and repricing characteristics for balance sheet and off-balance sheet instruments and incorporates market-based assumptions regarding the effect of changing interest rates on the prepayment rates of certain assets and liabilities. In addition, this sensitivity analysis examines assets and liabilities at the beginning of the measurement period and does not assume any changes from growth or business plans over the next twelve months. Interest-earning assets and interest-bearing liabilities are assumed to re-price based on contractual terms over the twelve-month measurement period assuming an instantaneous parallel shift in interest rates in effect at the beginning of the measurement period. The simulation analysis also incorporates assumptions based on the historical behavior of deposit rates in relation to interest rates. Because these assumptions are inherently uncertain, the simulation analysis cannot definitively measure net interest income or predict the impact of the fluctuation in interest rates on net interest income, but does provide an indication of the Company's sensitivity to changes in interest rates. Actual results may differ from simulated results due to the timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies.

The Company's current simulation analysis indicates we would benefit from rising interest rates. Interest-earning assets consist of short and long-term products. Excluding non-accrual loans, and including the impact of hedging certain corporate variable rate loans using interest rate swaps through which the Company receives fixed amounts and pays variable amounts, 47% of the loan portfolio consisted of fixed rate loans and 53% were floating rate loans as of June 30, 2020, compared to 49% and 51% at December 31, 2019. See Note 12 of "Notes to the Condensed Consolidated Financial Statements" in Part I, Item 1 of this Form 10-Q for additional detail regarding interest rate swaps.

As of June 30, 2020, investments, consisting of securities and interest-bearing deposits in other banks, are more heavily weighted toward fixed rate securities at 85% of the total compared to 15% for floating rate interest-bearing deposits in other banks, compared to 97% of the total compared to 3% for the floating rate interest-bearing deposits in other banks at December 31, 2019. Fixed rate loans are most sensitive to the 3-5 year portion of the yield curve and the Company limits its loans with maturities that extend beyond 5 years. The majority of floating rate loans are indexed to the short-term LIBOR or Prime rates. The amount of floating rate loans with active interest rate floors was $608.0 million, or 8%, of the floating rate loan portfolio as of June 30, 2020 and was not meaningful as of December 31, 2019. On the liability side of the balance sheet, 85% and 77% of deposits as of June 30, 2020 and December 31, 2019 were demand deposits or interest-bearing core deposits, which either do not pay interest or the interest rates are expected to change at a slower pace than short-term interest rates.

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Analysis of Net Interest Income Sensitivity

(Dollar amounts in thousands)

	Immediate Change in Rates
	+300			+200			+100			-100
As of June 30, 2020
Dollar change	$	135,337		$	90,232		$	45,205		$	(21,147)
Percent change	25.6		%	17.0		%	8.5		%	(4.0)		%
As of December 31, 2019
Dollar change	$	59,842		$	40,687		$	21,525		$	(32,217)
Percent change	10.3		%	7.0		%	3.7		%	(5.6)		%

The sensitivity of estimated net interest income to an instantaneous parallel shift in interest rates is reflected as both dollar and percentage changes. This table illustrates that an instantaneous 100 basis point rise in interest rates as of June 30, 2020 would increase net interest income by $45.2 million, or 8.5%, over the next twelve months compared to no change in interest rates. This same measure was $21.5 million, or 3.7%, as of December 31, 2019.

Overall, interest rate risk volatility as of June 30, 2020 compared to December 31, 2019 was higher due to an increase in balance sheet liquidity and reduced funding needs, as well as the impact of recently declining market interest rates which limits our capacity to lower interest-bearing deposit rates further.

ITEM 4. CONTROLS AND PROCEDURES

As of the end of the period covered by this report (the "Evaluation Date"), the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chairman of the Board and Chief Executive Officer and its Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Based on that evaluation, the Chairman of the Board and Chief Executive Officer and Executive Vice President and Chief Financial Officer concluded that as of the Evaluation Date, the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms. There were no changes in the Company's internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In the ordinary course of business, there were certain legal proceedings pending against the Company and its subsidiaries at June 30, 2020. While the outcome of any legal proceeding is inherently uncertain, based on information currently available, the Company's management does not expect that any liabilities arising from pending legal matters will have a material adverse effect on the Company's business, financial condition, or results of operations.

ITEM 1A. RISK FACTORS

A discussion of certain risks and uncertainties faced by the Company is provided in the section entitled "Risk Factors" in the Company's 2019 10-K. These risks and uncertainties are not exhaustive. Additional risks and uncertainties are discussed in the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this report, the 2019 10-K, and the Company's other filings made with the SEC, as well as in other sections of such reports. The following risk factor represents material updates and additions to, and should be read together with, the risk factors previously disclosed in the 2019 10-K.

The Company's business, financial condition, liquidity, capital and results of operations have been, and will likely continue to be, adversely affected by the pandemic.

The pandemic has created economic and financial disruptions that have adversely affected, and are likely to continue to adversely affect, the Company's business, financial condition, liquidity, capital and results of operations. The extent to which the pandemic will continue to negatively affect the Company's business, financial condition, liquidity, capital and results of operations will depend on future developments, which are highly uncertain and cannot be predicted and many of which are outside of the Company's control, including the scope and duration of the pandemic, including the possibility of resurgence of

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after initial abatement, the continued effectiveness of the Company's business continuity plan including work-from-home arrangements and staffing in operational facilities, the direct and indirect impact of the pandemic on the Company's employees, clients, counterparties and service providers, as well as other market participants, and actions taken, or that may yet be taken, by governmental authorities and other third parties in response to the pandemic.

Among other things, the pandemic has contributed to, and is likely to continue to contribute to:

•Increased unemployment and decreased consumer and business confidence and economic activity, leading to an increased risk of loan delinquencies, defaults and foreclosures.

•Ratings downgrades, credit deterioration and defaults in many industries, including, but not limited to, hospitality, transportation and commercial real estate.

•A decrease in the rates and yields on U.S. Treasury securities, which may lead to further decreased net interest income.

•Volatility in financial and capital markets, interest rates and exchange rates.

•Significant draws on credit lines, including syndicated credit lines, as customers and clients seek to increase liquidity.

•Declines in collateral values.

•Increased demands on capital and liquidity, leading the Company to suspend purchases of its common stock in order to meet client needs.

•A reduction in the value of the assets that the Company manages or otherwise administers or services for others, affecting related fee income and demand for the Company's services.

•Heightened cybersecurity, information security and operational risks as cybercriminals attempt to profit from the disruption resulting from the pandemic given increased online and remote activity, including as a result of work-from-home arrangements.

•Disruptions to business operations at counterparties and service providers.

•Decreased demands for our products and services.

As a result, our credit, operational and other risks are generally expected to increase until the pandemic subsides.

In addition, our own business operations are at risk of disruption if significant portions of our workforce are unable to work effectively, including because of illness, quarantines, government actions, failures in systems or technology that disrupt work-from-home arrangements or other effects of the pandemic, or if we are unable to keep our branches open, including because of risk of infection. We have already taken action to reduce operating hours and lobby services at our branches.

Governmental authorities have taken unprecedented measures both to contain the spread of the pandemic, including shelter in place orders, business limitations and other shutdowns, which have severely restricted economic activity, and to provide economic assistance to individuals and businesses, stabilize the markets and support economic growth. The success of these measures is unknown and they may not be sufficient to fully mitigate the negative impact of the pandemic. Additionally, some measures, such as payment deferrals on mortgage and other loans, suspension of certain foreclosures, repossessions and other loan collection activity, continuation of certain fee assistance programs and other client accommodations may have a negative impact on the Company's business, financial condition, liquidity and results of operations. If such measures are not effective in mitigating the effects of the pandemic on our borrowers, or if such measures exacerbate the effects of the pandemic on our borrowers, we may also experience higher rates of default and increased credit losses in future periods. The Company also faces an increased risk of litigation and governmental and regulatory scrutiny as a result of the effects of the pandemic on market and economic conditions and actions governmental authorities take in response to those conditions. Furthermore, various government programs such as the Paycheck Protection Program are complex and our participation may lead to litigation and governmental, regulatory and third party scrutiny, negative publicity and damage to our reputation.

The length of the pandemic and the efficacy of the extraordinary measures being put in place to address it are unknown. There are no comparable recent events that provide guidance as to the economic recovery from the effects of the pandemic or the effect the spread of COVID-19 as a global pandemic may have. As a result of the pandemic, the Company has experienced and expects to continue to experience draws on lines of credit, reduced net interest income and net interest margin, reduced revenues in its fee-based businesses, and increased client defaults, including defaults on unsecured loans, resulting in overall declines in credit quality and higher credit loss expense. Even after the pandemic subsides, the U.S. economy may continue to experience a recession, and the Company anticipates that its businesses would be materially and adversely affected by a prolonged recession. To the extent the pandemic adversely affects the Company's business, financial condition, liquidity, capital or results of operations, it may also have the effect of heightening many of the other risks described in the section entitled "Risk Factors" in the 2019 10-K and the Company's other filings made with the SEC, as well as in other sections of those reports.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table summarizes the Company's monthly common stock repurchases during the second quarter of 2020. On February 19, 2020, the Board approved a stock repurchase program, under which the Company is authorized to repurchase up to $200 million of its outstanding common stock through December 31, 2021. The Company suspended repurchases in March as it shifted its capital deployment strategy in response to the pandemic.

Issuer Purchases of Equity Securities

	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan or Program
April 1 - April 30, 2020	366	$	13.80	—	$	188,458,427
May 1 - May 31, 2020	280	12.76		—	188,458,427
June 1 - June 30, 2020	359	14.77		—	188,458,427
Total	1,005	$	13.86	—

⁽¹⁾Consists of shares acquired pursuant to the Company's Board-approved stock repurchase program and the Company's share-based compensation plans. Under the terms of the Company's share-based compensation plans, the Company accepts previously owned shares of common stock surrendered to satisfy tax withholding obligations associated with the vesting of restricted stock.

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ITEM 6. EXHIBITS

Exhibit Number	Description of Documents
3.1	Certificate of Designations of the Company’s 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, dated May 18, 2020, is incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 20, 2020.
3.2	Certificate of Designations of the Company’s 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, dated June 23, 2020, is incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 24, 2020.
4.1	Deposit Agreement, dated May 20, 2020, among the Company, Computershare, Inc. and Computershare Trust Company, N.A., acting jointly as depositary, and the holders from time to time of the depositary receipts evidencing the depositary shares representing interests in the Company’s 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, described therein is incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 20, 2020.
4.2	Form of depositary receipt evidencing the depositary shares representing interests in the Company’s 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A (included as Exhibit A to Exhibit 4.1).
4.3	Deposit Agreement, dated June 24, 2020, among the Company, Computershare, Inc. and Computershare Trust Company, N.A., acting jointly as depositary, and the holders from time to time of the depositary receipts evidencing the depositary shares representing interests in the Company’s 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, described therein is incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 24, 2020.
4.4	Form of depositary receipt evidencing the depositary shares representing interests in the Company’s 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C (included as Exhibit A to Exhibit 4.3).
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1(1)	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2(1)	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as inline XBRL and included in Exhibit 101)

⁽¹⁾Furnished, not filed.

77

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

                      First Midwest Bancorp, Inc.
 

                         /s/ PATRICK S. BARRETT

                               Patrick S. Barrett
    Executive Vice President and Chief Financial Officer*

Date: August 6, 2020

* Duly authorized to sign on behalf of the registrant.

78

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Michael L. Scudder, certify that:

1.I have reviewed this report on Form 10-Q of First Midwest Bancorp, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

1.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2020	/s/ MICHAEL L. SCUDDER
	Chairman of the Board and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Patrick S. Barrett, certify that:

1.I have reviewed this report on Form 10-Q of First Midwest Bancorp, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

1.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2020	/s/ PATRICK S. BARRETT
	Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, the undersigned officer of First Midwest Bancorp, Inc. (the "Company"), hereby certifies that:

1.The Company's Report on Form 10-Q for the quarter ended June 30, 2020 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities and Exchange Act of 1934, as amended; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ MICHAEL L. SCUDDER
Name:	Michael L. Scudder
Title:	Chairman of the Board and Chief Executive Officer
Dated:	August 6, 2020

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, the undersigned officer of First Midwest Bancorp, Inc. (the "Company"), hereby certifies that:

1.The Company's Report on Form 10-Q for the quarter ended June 30, 2020 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities and Exchange Act of 1934, as amended; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ PATRICK S. BARRETT
Name:	Patrick S. Barrett
Title:	Executive Vice President and Chief Financial Officer
Dated:	August 6, 2020

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover - shares	6 Months Ended
	Jun. 30, 2020	Aug. 03, 2020
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-39320
Entity Registrant Name	First Midwest Bancorp, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-3161078
Entity Address, Address Line One	8750 West Bryn Mawr Avenue
Entity Address, Address Line Two	Suite 1300
Entity Address, City or Town	Chicago
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60631-3655
City Area Code	708
Local Phone Number	831-7483
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		114,305,540
Amendment Flag	false
Entity Central Index Key	0000702325
Document Period End Date	Jun. 30, 2020
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q2
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common stock, $0.01 par value
Trading Symbol	FMBI
Security Exchange Name	NASDAQ
Series A Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	Depositary shares, each representing a 1/40th interest in a share of 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A
Trading Symbol	FMBIP
Security Exchange Name	NASDAQ
Series C Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	Depositary shares, each representing a 1/40th interest in a share of 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C
Trading Symbol	FMBIO
Security Exchange Name	NASDAQ

XML

Consolidated Statements of Financial Condition - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Assets
Cash and due from banks	$ 304,445	$ 214,894
Interest-bearing deposits in other banks	637,856	84,327
Equity securities, at fair value	43,954	42,136
Securities available-for-sale, at fair value	3,435,862	2,873,386
Securities held-to-maturity, at amortized cost, net	19,628	21,997
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") stock, at cost	148,512	115,409
Loans	14,933,658	12,840,330
Allowance for loan losses	(240,052)	(108,022)
Net loans	14,693,606	12,732,308
Other real estate owned ("OREO")	9,947	8,750
Premises, furniture, and equipment, net	143,001	147,996
Investment in bank-owned life insurance ("BOLI")	299,649	296,351
Goodwill and other intangible assets	940,182	875,262
Accrued interest receivable and other assets	568,239	437,581
Total assets	21,244,881	17,850,397
Liabilities
Noninterest-bearing deposits	5,602,016	3,802,422
Interest-bearing deposits	10,055,640	9,448,856
Total deposits	15,657,656	13,251,278
Short-term Debt	2,305,195	1,658,758
Senior and subordinated debt	234,358	233,948
Accrued interest payable and other liabilities	391,461	335,620
Total liabilities	18,588,670	15,479,604
Stockholders' Equity
Preferred stock	230,500	0
Common stock	1,253	1,204
Additional paid-in capital	1,268,647	1,211,274
Retained earnings	1,359,407	1,380,612
Accumulated other comprehensive income (loss), net of tax	28,727	(1,954)
Treasury stock, at cost	(232,323)	(220,343)
Total stockholders' equity	2,656,211	2,370,793
Total liabilities and stockholders' equity	$ 21,244,881	$ 17,850,397
Stockholders' Equity, Number of Shares, Par Value, and Other Disclosures
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	1,000,000	1,000,000
Common stock, shares authorized (in shares)	250,000,000	250,000,000
Preferred stock, shares issued (in shares)	231,000
Common stock, shares issued (in shares)	125,355,000	120,415,000
Preferred stock, shares outstanding (in shares)	231,000
Common stock, shares outstanding (in shares)	114,276,000	109,972,000
Treasury stock, shares (in shares)	11,079,000	10,443,000

XML

Condensed Consolidated Statements of Income - USD ($) shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Interest Income
Loans	$ 140,819,000	$ 157,680,000	$ 288,605,000	$ 302,484,000
Investment securities	20,386,000	18,005,000	40,624,000	34,011,000
Other short-term investments	839,000	1,997,000	3,042,000	3,677,000
Total interest income	162,044,000	177,682,000	332,271,000	340,172,000
Interest Expense
Deposits	10,077,000	19,316,000	27,194,000	35,918,000
Borrowed funds	3,156,000	4,459,000	8,997,000	8,010,000
Senior and subordinated debt	3,577,000	3,595,000	7,271,000	6,908,000
Total interest expense	16,810,000	27,370,000	43,462,000	50,836,000
Net interest income	145,234,000	150,312,000	288,809,000	289,336,000
Provision for loan losses	32,649,000	11,491,000	72,181,000	21,935,000
Net interest income after provision for loan losses	112,585,000	138,821,000	216,628,000	267,401,000
Noninterest Income
Wealth management fees	11,942,000	12,190,000	24,303,000	23,790,000
Service charges on deposit accounts	9,125,000	12,196,000	20,906,000	23,736,000
Mortgage banking income	3,477,000	1,901,000	5,265,000	2,905,000
Card-based fees	3,180,000	4,549,000	7,148,000	8,927,000
Other service charges, commissions, and fees	2,078,000	2,783,000	4,760,000	5,394,000
Capital market products income	694,000	2,154,000	5,416,000	3,433,000
Net securities losses	0	0	(1,005,000)	0
Other income	2,495,000	2,753,000	5,560,000	5,247,000
Total noninterest income	32,991,000	38,526,000	72,353,000	73,432,000
Noninterest Expense
Salaries and employee benefits	63,672,000	58,692,000	126,531,000	116,065,000
Net occupancy and equipment expense	15,116,000	12,294,000	29,343,000	26,091,000
Technology and related costs	9,853,000	7,128,000	18,401,000	13,398,000
Professional services	8,880,000	9,624,000	19,270,000	16,711,000
Net OREO expense	126,000	294,000	546,000	975,000
Other expenses	17,434,000	16,154,000	32,849,000	29,107,000
Acquisition and integration related expenses	5,249,000	9,514,000	10,721,000	13,205,000
Delivering Excellence implementation costs	0	442,000	0	700,000
Total noninterest expense	120,330,000	114,142,000	237,661,000	216,252,000
Income before income tax expense	25,246,000	63,205,000	51,320,000	124,581,000
Income tax expense	6,182,000	16,191,000	12,650,000	31,509,000
Net income	19,064,000	47,014,000	38,670,000	93,072,000
Preferred dividends	(1,037,000)	0	(1,037,000)	0
Net income applicable to unvested restricted shares	(187,000)	(389,000)	(379,000)	(792,000)
Net income applicable to common shares	$ 17,840,000	$ 46,625,000	$ 37,254,000	$ 92,280,000
Per Common Share Data
Basic earnings per common share (in dollars per share)	$ 0.16	$ 0.43	$ 0.33	$ 0.86
Diluted earnings per common share (in dollars per share)	0.16	0.43	0.33	0.86
Dividends declared per common share (in dollars per share)	$ 0.14	$ 0.14	$ 0.28	$ 0.26
Weighted-average common shares outstanding (in Shares)	113,145	108,467	111,533	107,126
Weighted-average diluted common shares outstanding (in Shares)	113,336	108,467	111,872	107,126

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Comprehensive Income [Abstract]
Net income	$ 19,064	$ 47,014	$ 38,670	$ 93,072
Unrealized holding (losses) gains:
Before tax	(1,719)	38,237	60,835	64,989
Tax effect	381	(10,649)	(16,916)	(18,100)
Net of tax	(1,338)	27,588	43,919	46,889
Reclassification of net losses included in net income:
Before tax	0	0	(1,005)	0
Tax effect	0	0	282	0
Net of tax	0	0	(723)	0
Net unrealized holding (losses) gains	(1,338)	27,588	43,196	46,889
Derivative Instruments
Before tax	(7,300)	2,441	(17,340)	3,899
Tax effect	2,042	(680)	4,825	(1,086)
Net of tax	(5,258)	1,761	(12,515)	2,813
Total other comprehensive (loss) income	(6,596)	29,349	30,681	49,702
Total comprehensive income	$ 12,468	$ 76,363	$ 69,351	$ 142,774

XML

Consolidated Statements of Comprehensive Income - AOCI - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	$ 2,370,793	$ 2,054,998
Ending balance	2,656,211	2,300,573
Accumulated Unrealized (Loss) Gain on Securities Available- for-Sale
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	15,808	(28,792)
Other comprehensive income (loss)	43,196	46,889
Ending balance	59,004	18,097
Accumulated Unrealized (Loss) Gain on Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	819	(2,550)
Other comprehensive income (loss)	(12,515)	2,813
Ending balance	(11,696)	263
Unrecognized Net Pension Costs
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(18,581)	(21,170)
Other comprehensive income (loss)	0	0
Ending balance	(18,581)	(21,170)
Total Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(1,954)	(52,512)
Other comprehensive income (loss)	30,681	49,702
Ending balance	$ 28,727	$ (2,810)

XML

Consolidated Statements of Changes In Stockholders' Equity - USD ($) $ in Thousands	Total	Cumulative Effect, Period Of Adoption, Adjustment		Common Stock	Preferred Stock	Additional Paid-in Capital	Retained Earnings	Retained Earnings Cumulative Effect, Period Of Adoption, Adjustment		Accumulated Other Comprehensive Income (Loss)	Treasury Stock
Beginning balance (in shares) at Dec. 31, 2018				106,375,000
Beginning balance at Dec. 31, 2018	$ 2,054,998	$ 47,257	[1]	$ 1,157	$ 0	$ 1,114,580	$ 1,192,767	$ 47,257	[1]	$ (52,512)	$ (200,994)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	93,072						93,072
Other comprehensive income (loss)	49,702									49,702
Common dividends declared	(28,340)						(28,340)
Repurchases of common stock (in shares)				(1,042,000)
Repurchases of common stock	(21,190)										(21,190)
Acquisitions, net of issuance costs (in shares)				4,879,000
Acquisition, net of issuance costs	101,496			$ 47		97,351					4,098
Common stock issued (in shares)				30,000
Common stock issued	605					(69)					674
Restricted stock activity (in shares)				353,000
Restricted stock activity	(3,770)					(13,320)					9,550
Treasury stock issued to benefit plans (in shares)				(6,000)
Treasury stock issued to benefit plans	(120)					(9)					(111)
Share-based compensation expense	6,863					6,863
Ending balance (in shares) at Jun. 30, 2019				110,589,000
Ending balance at Jun. 30, 2019	2,300,573			$ 1,204	0	1,205,396	1,304,756			(2,810)	(207,973)
Beginning balance (in shares) at Mar. 31, 2019				106,900,000
Beginning balance at Mar. 31, 2019	2,159,471			$ 1,157	0	1,103,991	1,273,245			(32,159)	(186,763)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	47,014						47,014
Other comprehensive income (loss)	29,349									29,349
Common dividends declared	(15,503)						(15,503)
Repurchases of common stock (in shares)				(1,042,000)
Repurchases of common stock	(21,190)										(21,190)
Acquisitions, net of issuance costs (in shares)				4,729,000
Acquisition, net of issuance costs	98,212			$ 47		98,165					0
Common stock issued (in shares)				3,000
Common stock issued	68					68					0
Restricted stock activity (in shares)				1,000
Restricted stock activity	5					(7)					12
Treasury stock issued to benefit plans (in shares)				(2,000)
Treasury stock issued to benefit plans	(37)					(5)					(32)
Share-based compensation expense	3,184					3,184
Ending balance (in shares) at Jun. 30, 2019				110,589,000
Ending balance at Jun. 30, 2019	$ 2,300,573			$ 1,204	0	1,205,396	1,304,756			(2,810)	(207,973)
Beginning balance (in shares) at Dec. 31, 2019	109,972,000			109,972,000
Beginning balance at Dec. 31, 2019	$ 2,370,793	$ (26,821)	[2]	$ 1,204	0	1,211,274	1,380,612	$ (26,821)	[2]	(1,954)	(220,343)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	38,670						38,670
Other comprehensive income (loss)	30,681									30,681
Preferred dividends	(1,037)						(1,037)
Common dividends declared	(32,017)						(32,017)
Preferred stock issued	221,312				230,500	(9,188)
Repurchases of common stock (in shares)				(1,171,000)
Repurchases of common stock	(22,557)										(22,557)
Acquisitions, net of issuance costs (in shares)				4,930,000
Acquisition, net of issuance costs	71,883			$ 49		71,834
Common stock issued (in shares)				43,000
Common stock issued	930			$ 0		251					679
Restricted stock activity (in shares)				513,000
Restricted stock activity	(3,135)					(13,180)					10,045
Treasury stock issued to benefit plans (in shares)				(11,000)
Treasury stock issued to benefit plans	(168)					(21)					(147)
Share-based compensation expense	$ 7,677					7,677
Ending balance (in shares) at Jun. 30, 2020	114,276,000			114,276,000
Ending balance at Jun. 30, 2020	$ 2,656,211			$ 1,253	230,500	1,268,647	1,359,407			28,727	(232,323)
Beginning balance (in shares) at Mar. 31, 2020				114,213,000
Beginning balance at Mar. 31, 2020	2,435,707			$ 1,253	0	1,274,935	1,357,395			35,323	(233,199)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	19,064						19,064
Other comprehensive income (loss)	(6,596)									(6,596)
Preferred dividends	(1,037)						(1,037)
Common dividends declared	(16,015)						(16,015)
Preferred stock issued	221,312				230,500	(9,188)
Common stock issued (in shares)				6,000
Common stock issued	79					79					0
Restricted stock activity (in shares)				64,000
Restricted stock activity	31					(912)					943
Treasury stock issued to benefit plans (in shares)				(7,000)
Treasury stock issued to benefit plans	(89)					(22)					(67)
Share-based compensation expense	$ 3,755					3,755
Ending balance (in shares) at Jun. 30, 2020	114,276,000			114,276,000
Ending balance at Jun. 30, 2020	$ 2,656,211			$ 1,253	$ 230,500	$ 1,268,647	$ 1,359,407			$ 28,727	$ (232,323)

[1] As a result of accounting guidance adopted in the first quarter of 2019, the remaining deferred gain on a sale-leaseback transaction was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2019.

[2] As a result of accounting guidance adopted in the first quarter of 2020, a portion of the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

XML

Consolidated Statements of Changes In Stockholders' Equity (Parentheticals) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Statement of Stockholders' Equity [Abstract]
Dividends declared per common share (in dollars per share)	$ 0.14	$ 0.14	$ 0.28	$ 0.26

XML

Consolidated Statements of Cash Flows - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Operating Activities
Net income	$ 38,670,000	$ 93,072,000
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	72,181,000	21,935,000
Depreciation of premises, furniture, and equipment	8,397,000	8,093,000
Net amortization of premium on securities	10,914,000	6,609,000
Net securities losses	1,005,000	0
Gains on sales of 1-4 family mortgages and corporate loans held-for-sale	(7,230,000)	(3,391,000)
Net losses (gains) on sales and valuation adjustments of OREO	128,000	(1,169,000)
Amortization of the FDIC indemnification asset	892,000	604,000
Net losses on sales and valuation adjustments of premises, furniture, and equipment	213,000	1,252,000
BOLI income	(3,798,000)	(3,645,000)
Share-based compensation expense	7,677,000	6,863,000
Tax benefit related to share-based compensation	148,000	160,000
Amortization of other intangible assets	5,590,000	4,987,000
Originations of mortgage loans held-for-sale	(297,019,000)	(164,398,000)
Proceeds from sales of mortgage loans held-for-sale	292,410,000	154,191,000
Net increase in equity securities	(1,818,000)	(2,918,000)
Net (increase) decrease in accrued interest receivable and other assets	(124,850,000)	19,027,000
Net increase (decrease) in accrued interest payables and other liabilities	12,871,000	(36,151,000)
Net cash provided by operating activities	16,381,000	105,121,000
Investing Activities
Proceeds from maturities, repayments, and calls of securities available-for-sale	497,430,000	167,502,000
Proceeds from sales of securities available-for-sale	39,095,000	93,332,000
Purchases of securities available-for-sale	(914,234,000)	(460,066,000)
Proceeds from maturities, repayments, and calls of securities held-to-maturity	2,467,000	3,162,000
Purchases of securities held-to-maturity	(18,000)	(2,837,000)
Net purchases of FHLB stock	(33,103,000)	(27,683,000)
Net increase in loans	(1,360,147,000)	(394,713,000)
Premiums paid on BOLI, net of proceeds from claims	2,997,000	3,260,000
Proceeds from sales of OREO	230,000	5,236,000
Proceeds from sales of premises, furniture, and equipment	0	2,291,000
Purchases of premises, furniture, and equipment	(4,647,000)	(10,360,000)
Net cash received from (paid for) acquisition	142,282,000	(13,532,000)
Net cash used in investing activities	(1,627,648,000)	(634,408,000)
Financing Activities
Net increase in deposit accounts	1,456,302,000	117,722,000
Net increase in borrowed funds	634,905,000	499,553,000
Net proceeds from the issuance of preferred stock	221,312,000	0
Repurchases of common stock	(22,557,000)	(21,190,000)
Cash dividends paid	(32,480,000)	(25,636,000)
Restricted stock activity	(3,135,000)	(3,770,000)
Net cash provided by financing activities	2,254,347,000	566,679,000
Net increase in cash and cash equivalents	643,080,000	37,392,000
Cash and cash equivalents at beginning of period	299,221,000	289,258,000
Cash and cash equivalents at end of period	942,301,000	326,650,000
Supplemental Disclosures of Cash Flow Information:
Income taxes paid	587,000	16,948,000
Interest paid to depositors and creditors	46,331,000	47,750,000
Dividends declared, but unpaid	15,857,000	15,377,000
Stock issued for acquisitions, net of issuance costs	71,883,000	101,496,000
Non-cash transfers of loans to OREO	121,000	322,000
Non-cash transfers of loans to other assets	0	13,175,000
Non-cash transfers of loans held-for-investment to loans held-for-sale	2,193,000	4,762,000
Non-cash recognition of right-of-use asset/liability	$ 0	$ 143,561,000

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation – The accompanying unaudited condensed consolidated interim financial statements ("consolidated financial statements") of First Midwest Bancorp, Inc. (the "Company"), a Delaware corporation, were prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q and reflect all adjustments that management deems necessary for the fair presentation of the financial position and results of operations for the periods presented. The results of operations for the quarter and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.

The accounting and reporting policies of the Company and its subsidiaries conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. The accompanying consolidated financial statements do not include certain information and note disclosures required by GAAP for complete annual financial statements. Therefore, these financial statements should be read in conjunction with the Company's 2019 Annual Report on Form 10-K ("2019 10-K"). The Company uses the accrual basis of accounting for financial reporting purposes. Certain reclassifications were made to prior year amounts to conform to the current year presentation.

Use of Estimates – The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates and assumptions are based on the best available information, actual results could differ from those estimates.

Principles of Consolidation – The accompanying consolidated financial statements include the financial position and results of operations of the Company and its subsidiaries after elimination of all significant intercompany accounts and transactions. Assets held in a fiduciary or agency capacity are not assets of the Company or its subsidiaries and are not included in the consolidated financial statements.

The accounting policies related to business combinations, loans, the allowance for credit losses, lease obligations, and derivative financial instruments are presented below. For a summary of all other significant accounting policies, see Note 1, "Summary of Significant Accounting Policies," in the Company's 2019 10-K.

Business Combinations – Business combinations are accounted for under the acquisition method of accounting. Assets acquired and liabilities assumed are recorded at their estimated fair values as of the date of acquisition, with any excess of the purchase price of the acquisition over the fair value of the identifiable net tangible and intangible assets acquired recorded as goodwill. Alternatively, a gain is recorded if the fair value of assets purchased exceeds the fair value of liabilities assumed and consideration paid. The results of operations of the acquired business are included in the Condensed Consolidated Statements of Income from the effective date of the acquisition.

Allowance for Securities Held-to-Maturity – The Company maintains an allowance for securities held-to-maturity for the risk of loss inherent in these financial assets, which reflects the difference between the carrying value and the discounted expected future cash flows of these assets and is included in securities held-to-maturity, at amortized cost, net in the Consolidated Statements of Financial Condition.

Loans – Loans held-for-investment are loans that the Company intends to hold until they are paid in full and are carried at the principal amount outstanding, including certain net deferred loan origination fees. Loan origination fees, commitment fees, and certain direct loan origination costs are deferred, and the net amount is amortized as a yield adjustment over the contractual life of the related loans or commitments and included in interest income. Fees related to letters of credit are amortized into fee income over the contractual life of the commitment. Other credit-related fees are recognized as fee income when earned. The Company's net investment in direct financing leases is included in loans and consists of future minimum lease payments and estimated residual values, net of unearned income. Interest income on loans is accrued based on principal amounts outstanding. Loans held-for-sale are carried at the lower of aggregate cost or fair value and included in other assets in the Consolidated Statements of Financial Condition.

Acquired Loans – Acquired loans consist of all loans that were acquired in business combinations, including loans which are covered by Federal Deposit Insurance Corporation ("FDIC") Agreements. Acquired loans are included within loans held-for-investment.

Acquired loans are separated into (i) non-purchased credit deteriorated ("non-PCD") loans and (ii) purchased credit deteriorated ("PCD") loans. Non-PCD loans include loans that did not have evidence of more-than-insignificant credit deterioration since origination at the acquisition date. PCD loans include loans that had evidence of more-than-insignificant credit deterioration

since origination. Evidence of credit deterioration was evaluated using various indicators, such as past due and non-accrual status. Leases and revolving loans do not qualify to be accounted for as PCD loans and are accounted for as non-PCD loans.

The acquisition adjustment related to non-PCD loans is amortized into interest income over the contractual life of the related loans. If an acquired non-PCD loan is renewed subsequent to the acquisition date, any remaining acquisition adjustment is accreted into interest income and the loan is considered a new loan that is no longer classified as an acquired loan.

PCD loans are generally accounted for based on estimates of expected future cash flows. The Company uses a discounted cash flow analysis involving significant unobservable inputs and assumptions to measure the fair value of PCD loans. The significant assumptions utilized in the cash flow analysis include the probability of default ("PD"), loss given default ("LGD"), and discount rate. PCD loans are recorded at fair value, excluding credit-related adjustments, for which an allowance for loan losses is established at the acquisition date through purchase accounting adjustments. Expected future cash flows in excess of the fair value of loans at the purchase date ("accretable yield") are recorded as interest income over the life of the loans if the timing and amount of the expected future cash flows can be reasonably estimated. Subsequent to the acquisition date, the allowance for loan losses on PCD loans is estimated as are the allowances for all other loans in the portfolio.

Prior to the adoption of the current expected credit losses ("CECL") accounting guidance on January 1, 2020, acquired loans were separated into (i) non-purchased credit impaired ("non-PCI") loans and (ii) purchased credit impaired ("PCI") loans. The significant accounting policies related to non-PCI and PCI acquired loans are presented in Note 1, "Summary of Significant Accounting Policies" to the Consolidated Financial Statements in the Company's 2019 10-K.

90-Days Past Due Loans – The Company's accrual of interest on loans is generally discontinued at the time the loan is 90 days past due unless the credit is sufficiently collateralized and in the process of renewal or collection.

Non-accrual Loans – Generally, corporate loans are placed on non-accrual status (i) when either principal or interest payments become 90 days or more past due unless the credit is sufficiently collateralized and in the process of renewal or collection, or (ii) when an individual analysis of a borrower's creditworthiness warrants a downgrade to non-accrual regardless of past due status. When a loan is placed on non-accrual status, unpaid interest credited to income in the current year is reversed, and unpaid interest accrued in prior years is charged against the allowance for loan losses. After the loan is placed on non-accrual status, all debt service payments are applied to the principal on the loan. Future interest income may only be recorded on a cash basis after recovery of principal is reasonably assured. Non-accrual loans are returned to accrual status when the financial position of the borrower and other relevant factors indicate that the Company will collect all principal and interest.

Non-accrual loans with balances under a specified threshold are not individually evaluated for impairment. For all other non-accrual loans, impairment is measured by comparing the estimated value of the loan to the recorded book value. The value of collateral-dependent loans is based on the fair value of the underlying collateral, less costs to sell. The value of other loans is measured using the present value of expected future cash flows discounted at the loan's effective interest rate.

Commercial loans and loans secured by real estate are charged-off when deemed uncollectible. A loss is recorded if the net realizable value of the underlying collateral is less than the outstanding principal and interest. Consumer loans that are not secured by real estate are subject to mandatory charge-off at a specified delinquency date and are usually not classified as non-accrual prior to being charged-off. Closed-end consumer loans, which include installment, automobile, and single payment loans, are usually charged-off no later than the end of the month in which the loan becomes 120 days past due.

Troubled Debt Restructurings ("TDRs") – A restructuring is considered a TDR when (i) the borrower is experiencing financial difficulties, and (ii) the creditor grants a concession, such as forgiveness of principal, reduction of the interest rate, changes in payments, or extension of the maturity date. Loans are not classified as TDRs when the modification is short-term or results in an insignificant delay in payments. The Company's TDRs are determined on a case-by-case basis.

The Company does not accrue interest on a TDR unless it believes collection of all principal and interest under the modified terms is reasonably assured. For a TDR to begin accruing interest, the borrower must demonstrate some level of past performance and the future capacity to perform under the modified terms. Generally, six months of consecutive payment performance under the restructured terms is required before a TDR is returned to accrual status. However, the period could vary depending on the individual facts and circumstances of the loan. An evaluation of the borrower's current creditworthiness is used to assess the borrower's capacity to repay the loan under the modified terms. This evaluation includes an estimate of expected future cash flows, evidence of strong financial position, and estimates of the value of collateral, if applicable. For TDRs to be removed from TDR status in the calendar year after the restructuring, the loans must (i) have an interest rate and terms that reflect market conditions at the time of restructuring, and (ii) be in compliance with the modified terms. If the loan was restructured at below market rates and terms, it continues to be separately reported as restructured until it is paid in full or charged-off.

Allowance for Credit Losses – The allowance for credit losses is comprised of the allowance for loan losses and the allowance for unfunded commitments and is maintained by management at a level believed adequate to absorb current expected credit losses in the existing loan portfolio. Determination of the allowance for credit losses is subjective since it requires significant estimates and management judgment, including the amounts and timing of expected future cash flows, actual loss experience, consideration of current national, regional, and local economic trends and conditions, reasonable and supportable forecasts about the future, changes in interest rates and property values, various internal and external qualitative factors, and other factors.

Loans deemed to be uncollectible are charged-off against the allowance for loan losses, while recoveries of amounts previously charged-off are credited to the allowance for loan losses. Additions to the allowance for loan losses are charged to expense through the provision for loan losses. The amount of provision depends on a number of factors, including net charge-off levels, loan growth, changes in the composition of the loan portfolio, and the Company's assessment of the allowance for loan losses based on the methodology discussed below.

Allowance for Loan Losses – The allowance for loan losses consists of (i) specific allowance for individual loans where the recorded investment exceeds the value, (ii) an allowance based on historical credit loss experience with consideration of reasonable and supportable forecasts of economic conditions for each loan category, and (iii) an allowance based on other internal and external qualitative factors.

The allowance for individual loans is based on a periodic analysis of non-accrual loans individually exceeding a specific dollar amount. If the estimated value of a non-accrual loan is less than its recorded book value, the Company either (i) provides an allowance in the amount of the excess of the book value over the estimated value of the related loan or, (ii) if the loss is confirmed, charges off the loss.

The allowance by loan category is based on a discounted cash flows analysis as future cash flows are discounted at an effective rate of return. In addition, estimates of losses on future cash flows is forecasted by applying probability of default and loss given default factors as well as prepayment and curtailment assumptions to cash flows that are adjusted to a present value. This discounted cash flow analysis is updated quarterly, primarily using actual loss experience adjusted for current reasonable and supportable forecasts of economic conditions over a one-year forecast period. After the one-year forecast period, a one-year reversion period adjusts loss experience to the historical average on a straight-line basis. These forecasts consider multiple scenarios of key assumptions including national unemployment rates, housing price indices, and gross domestic product.

This general allowance component is then adjusted based on management's consideration of many internal and external qualitative factors, including:

•Changes in the composition of the loan portfolio, trends in the volume of loans, and trends in delinquent and non-accrual loans that could indicate that historical trends do not reflect current conditions.

•Changes in credit policies and procedures, such as underwriting standards and collection, charge-off, and recovery practices.

•Changes in the experience, ability, and depth of credit management and other relevant staff.

•Changes in the quality of the Company's loan review system and Board of Directors oversight.

•The effect of any concentration of credit and changes in the level of concentrations, such as loan type or risk rating.

•Changes in the value of the underlying collateral for collateral-dependent loans.

•Changes in the national, regional, and local economy that affect the collectability of various segments of the portfolio.

•The effect of other external factors, such as competition and legal and regulatory requirements, on the Company's loan portfolio.

The allowance for loan losses also includes an allowance on acquired non-PCD and PCD loans. An allowance for loan losses is recorded on acquired PCD loans at the acquisition date through purchase accounting adjustments. Subsequent to the acquisition date, the allowance for loan losses on PCD loans is estimated as are the allowances for all other loans in the portfolio. No allowance for loan losses is recorded on acquired non-PCD loans at the acquisition date through purchase accounting. Instead, an allowance is established on acquired non-PCD loans at the acquisition date in-line with all other loans in the portfolio as if the loans were originated at the acquisition date. On a periodic basis, the adequacy of this allowance is determined using either a PD/LGD methodology or a specific review methodology.

Allowance for Unfunded Commitments – The Company also maintains an allowance for unfunded commitments, including letters of credit, for the risk of loss inherent in these arrangements. The allowance for unfunded commitments is estimated using the historical credit loss experience with consideration of reasonable and supportable forecasts of economic conditions for each loan category. The allowance for unfunded commitments is included in other liabilities in the Consolidated Statements of Financial Condition.

The establishment of the allowance for credit losses involves a high degree of judgment and estimation given the difficulty of assessing the factors impacting loan repayment and estimating the timing and amount of losses. While management utilizes its best judgment and information available, the adequacy of the allowance for credit losses depends on a variety of factors beyond the Company's control, including the performance of its loan portfolio, current national, regional, and local economic trends, reasonable and supportable forecasts about the future, changes in interest rates and property values, the amounts and timing of expected future cash flows on non-accrual loans, estimated losses on pools of homogenous loans, the interpretation of loan risk classifications by regulatory authorities, various internal and external qualitative factors, and other factors.

Lease Obligations – The Company leases certain premises under non-cancelable operating leases in the normal course of business operations. These lease obligations result in the recognition of right-of-use assets and associated lease liabilities. The amount of right-of-use assets and associated lease liabilities recorded is based on the present value of future minimum lease payments. Right-of-use assets are amortized on a straight-line basis over the estimated useful lives of the related premises, and interest associated with the net present value of future minimum lease payments is included in net occupancy and equipment expense in the consolidated financial statements.

Derivative Financial Instruments – To provide derivative products to customers and in the ordinary course of business, the Company enters into derivative transactions as part of its overall interest rate risk management strategy to minimize significant unplanned fluctuations in earnings and expected future cash flows caused by interest rate volatility. All derivative instruments are recorded at fair value as either other assets or other liabilities in the Consolidated Statements of Financial Condition. Subsequent changes in a derivative's fair value are recognized in earnings unless specific hedge accounting criteria are met.

On the date the Company enters into a derivative contract, the derivative is designated as a fair value hedge, a cash flow hedge, or a non-hedge derivative instrument. Fair value hedges are designed to mitigate exposure to changes in the fair value of an asset or liability attributable to a particular risk, such as interest rate risk. Cash flow hedges are designed to mitigate exposure to variability in expected future cash flows to be received or paid related to an asset, liability, or other type of forecasted transaction. The Company formally documents all relationships between hedging instruments and hedged items, including its risk management objective and strategy at inception.

At the hedge's inception, a formal assessment is performed to determine the effectiveness of the derivative in offsetting changes in the fair values or expected future cash flows of the hedged items in the current period and prospectively. If a derivative instrument designated as a hedge is terminated or ceases to be highly effective, hedge accounting is discontinued prospectively, and the gain or loss is amortized into earnings. For fair value hedges, the gain or loss is amortized over the remaining life of the hedged asset or liability. For cash flow hedges, the gain or loss is amortized over the same period that the forecasted hedged transactions impact earnings. If the hedged item is disposed of, any fair value adjustments are included in the gain or loss from the disposition of the hedged item. If the forecasted transaction is no longer probable, the gain or loss is included in earnings immediately.

For fair value hedges, changes in the fair value of the derivative instruments, as well as changes in the fair value of the hedged item, are recognized in earnings in the same income statement line item as the earnings effect of the hedged item. For cash flow hedges, the effective portion of the change in fair value of the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and is reclassified to earnings when the hedged transaction is reflected in earnings.

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Recent Accounting Pronouncements and Other Guidance

6 Months Ended

Jun. 30, 2020

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements and Other Guidance

RECENT ACCOUNTING PRONOUNCEMENTS AND OTHER GUIDANCE

Adopted Accounting Pronouncements

Measurement of Credit Losses on Financial Instruments: In June of 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2016-13 that requires entities to present financial assets measured at amortized cost at the net amount expected to be collected, considering an entity's current estimate of all expected credit losses. In addition, credit losses relating to available-for-sale debt securities are required to be recorded through an allowance for credit losses, with changes in credit loss estimates recognized through current earnings. This guidance is effective for annual and interim periods beginning after December 15, 2019.

The Company adopted this guidance on January 1, 2020, which resulted in the recognition of $76.0 million of allowance for credit losses which includes $26.0 million attributable to loans, $5.6 million attributable to unfunded commitments, $35.7 million attributable to PCD loans, $8.5 million attributable to non-PCD acquired loans, and $220,000 attributable to securities held-to-maturity. The portion of the allowance for credit losses attributable to PCD loans did not have an impact on equity as the credit-related portion of acquisition adjustments on loans previously classified as PCI transitioned to PCD accounting treatment upon adoption. The amount of allowance for credit losses recognized upon adoption was based on the composition of the loan portfolio, as well as the economic conditions and forecasts as of the adoption date. The Company adopted this guidance using the modified retrospective approach which resulted in the recognition of a $26.8 million after-tax

reduction to retained earnings as a cumulative-effect adjustment on January 1, 2020. Prior period amounts continue to be reported in accordance with previously applicable standards and the accounting policies described in the Company's 2019 10-K.

The Company has made the following elections upon adoption of ASU 2016-13:

•When determining the allowance and net carrying value amount for financial assets in which the repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty, the Company will use the fair value of collateral at the reporting date.

•The Company writes off uncollectible accrued interest in a timely manner and, therefore, will not measure an allowance for credit losses for accrued interest receivable.

•The Company uses a discounted cash flow approach for the majority of its applicable instruments. The change in the present value from one reporting period to the next may result from the passage of time, in addition to changes in estimates of the timing of the cash flows. The Company will report the entire change in the present value as provision for loan losses (or reversal of provision for loan losses) versus reporting the change related to the passage of time as interest income.

For additional discussion of the allowance for credit losses, see Note 7 "Past Due Loans, Allowance for Credit Losses, Non-Accrual Loans, and TDRs."

Accounting for Goodwill Impairment: In January of 2017, the FASB issued ASU 2017-04 that simplifies the accounting for goodwill impairment for all entities. The new guidance eliminates the requirement to calculate the implied fair value of goodwill using the second step of the quantitative two-step goodwill impairment model prescribed under current accounting guidance. Under the new guidance, if a reporting unit's carrying amount exceeds its fair value, an entity will record an impairment charge based on that difference. This guidance is effective for annual and interim goodwill impairment testing dates beginning after December 15, 2019. The adoption of this guidance on January 1, 2020 did not materially impact the Company's financial condition, results of operations, or liquidity.

Changes to the Disclosure Requirements for Fair Value Measurement: In August of 2018, the FASB issued ASU 2018-13 that eliminates, modifies, and adds to certain fair value measurement disclosure requirements associated with the three-tiered fair value hierarchy. This guidance is effective for annual and interim periods beginning after December 15, 2019. The adoption of this guidance on January 1, 2020 did not materially impact the Company's financial condition, results of operations, or liquidity.

Loan Modifications Due to COVID-19: In March of 2020, the CARES Act was enacted by the U.S. government in response to the economic disruption caused by the COVID-19 pandemic (the "pandemic"). The Company's banking regulators issued a statement titled the "Interagency Statement on Loan Modifications by Financial Institutions Working with Customers Affected by the Coronavirus" that encourages financial institutions to work prudently with borrowers who are or may be unable to meet their contractual payment obligations due to the effects of the pandemic. Additionally, the CARES Act provides that a qualified loan modification is exempt by law from classification as a TDR as defined by GAAP, from the period beginning March 1, 2020 until the earlier of December 31, 2020 or the date that is 60 days after the date on which the national emergency concerning the pandemic declared by the President of the United States terminates. Accordingly, the Company is offering short-term modifications made in response to the pandemic to borrowers who are current and otherwise not past due. These include short-term modifications in the form of payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. The total balance of loans with eligible modifications as of June 30, 2020 was $1.9 billion.

Regulatory Capital Delay of CECL Impact: In February of 2019, the federal bank regulatory agencies issued a final rule, the 2019 CECL Rule, that revised certain capital regulations to account for changes to credit loss accounting under U.S. GAAP. The 2019 CECL Rule included a transition option that allows banking organizations to phase in, over a three-year period, the day-one adverse effects of CECL on their regulatory capital ratios (three-year transition option). In March of 2020, the federal bank regulatory agencies issued an interim final rule that maintains the three year transition option of the 2019 CECL Rule and also provides banking organizations that were required under GAAP (as of January 2020) to implement CECL before the end of 2020 the option to delay for two years an estimate of the effect of CECL on regulatory capital, relative to the incurred loss methodology's effect on regulatory capital, followed by a three-year transition period (five-year transition option). The Company elected to adopt the five-year transition option. This election of the transition option is applicable only to regulatory capital computations under federal banking regulations and does not otherwise impact the financial statements prepared in accordance with GAAP.

Accounting Pronouncements Pending Adoption

Changes to the Disclosure Requirements for Defined Benefit Plans: In August of 2018, the FASB issued ASU 2018-14 that makes minor changes and clarifications to the disclosure requirements for entities that sponsor defined benefit plans. This guidance is effective for annual and interim periods beginning after December 15, 2020. Early adoption is permitted.

Management does not expect the adoption of this guidance will materially impact the Company's financial condition, results of operations, or liquidity.

Income Taxes: In December of 2019, the FASB issued ASU 2019-12 that removes certain exceptions to the general principles of accounting for income taxes. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. Management does not expect the adoption of this guidance will materially impact the Company's financial condition, results of operations, or liquidity.

Reference Rate Reform: In March of 2020, the FASB issued ASU 2020-04 that provides optional expedients and exceptions for applying GAAP to contracts and other transactions affected by reference rate reform, if certain criteria are met. This guidance is effective as of March 12, 2020 through December 31, 2022. Management is in the process of determining the impact on the Company's financial condition, results of operations, and liquidity.

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Acquisitions

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Acquisitions

ACQUISITIONS

Completed Acquisitions

Park Bank

On March 9, 2020, the Company completed its acquisition of Bankmanagers Corp. ("Bankmanagers"), the holding company for Park Bank, based in Milwaukee Wisconsin. At closing, the Company acquired $1.2 billion of assets, $1.0 billion of deposits, and $685.5 million of loans, net of fair value adjustments. Under the terms of the merger agreement, on March 9, 2020, each outstanding share of Bankmanagers common stock was exchanged for 29.9675 shares of Company common stock, plus $623.02 of cash (of which $346.00 per share was paid by Bankmanagers to its shareholders by a special cash dividend immediately prior to closing). This resulted in merger consideration of $174.4 million, which consisted of 4.9 million shares of Company common stock and $102.5 million of cash. Goodwill of $62.4 million associated with the acquisition was recorded by the Company. All Park Bank operating systems were converted to the Company's operating platform during the second quarter of 2020. The fair value adjustments, including goodwill, associated with the transaction remain preliminary and may change as the Company continues to finalize the fair value of the assets and liabilities acquired.

During the second quarter of 2020, the Company updated the fair value adjustments associated with the Bankmanagers transaction. These adjustments were recognized in the current period in accordance with accounting guidance applicable to business combinations.

Bridgeview Bank Group

On May 9, 2019, the Company completed its acquisition of Bridgeview Bancorp, Inc. ("Bridgeview"), the holding company for Bridgeview Bank Group. At closing, the Company acquired $1.2 billion of assets, $1.0 billion of deposits, and $709.4 million of loans, net of fair value adjustments. Under the terms of the merger agreement, on May 9, 2019, each outstanding share of Bridgeview common stock was exchanged for 0.2767 shares of Company common stock, plus $1.66 of cash. In addition, each outstanding Bridgeview stock option was exchanged for the right to receive cash. This resulted in merger consideration of $135.4 million, which consisted of 4.7 million shares of Company common stock and $37.1 million of cash. Goodwill of $63.2 million associated with the acquisition was recorded by the Company. All Bridgeview operating systems were converted to the Company's operating platform during the second quarter of 2019.

During the second quarter of 2020, the Company finalized the fair value adjustments associated with the Bridgeview transaction, which required measurement period adjustments to goodwill. These adjustments were recognized in the current period in accordance with accounting guidance applicable to business combinations.

Northern Oak Wealth Management, Inc.

On January 16, 2019, the Company completed its acquisition of Northern Oak Wealth Management, Inc., a registered investment adviser based in Milwaukee, Wisconsin with approximately $800.0 million of assets under management at closing. During the first quarter of 2020, the Company finalized the fair value adjustments associated with the Northern Oak transaction, which required a measurement period adjustment to goodwill. This adjustment was recognized in the current period in accordance with accounting guidance applicable to business combinations.

The following table presents the assets acquired and liabilities assumed, net of the fair value adjustments, in the Park Bank and Bridgeview transactions as of the acquisition date. The assets acquired and liabilities assumed, both intangible and tangible, were recorded at their estimated fair values as of the acquisition date and have been accounted for under the acquisition method of accounting.

Acquisition Activity

(Dollar amounts in thousands, except share and per share data)

	Park Bank		Bridgeview
	March 9, 2020		May 9, 2019
Assets
Cash and due from banks and interest-bearing deposits in other banks	$	244,781	$	35,097
Equity securities	—		6,966
Securities available-for-sale	136,856		263,090
Securities held-to-maturity	300		13,426
FHLB and FRB stock	—		1,481
Loans	685,451		709,438
OREO	2,001		5,436
Goodwill	62,433		63,231
Other intangible assets	3,068		15,603
Premises, furniture, and equipment	2,550		16,138
Accrued interest receivable and other assets	13,796		35,909
Total assets	$	1,151,236	$	1,165,815
Liabilities
Noninterest-bearing deposits	$	356,050	$	179,267
Interest-bearing deposits	594,026		807,487
Total deposits	950,076		986,754
Borrowed funds	11,532		1,746
Senior and subordinated debt	—		29,360
Accrued interest payable and other liabilities	15,246		12,603
Total liabilities	976,854		1,030,463
Consideration Paid
Common stock (2020 – 4,930,231, shares issued at $14.58 per share, 2019 –   4,728,541, shares issued at $20.77 per share), net of issuance costs	71,883		98,212
Cash paid	102,499		37,140
Total consideration paid	174,382		135,352
	$	1,151,236	$	1,165,815

Expenses related to the acquisition and integration of completed and pending transactions are reported as a separate component within noninterest expense in the Condensed Consolidated Statements of Income. For the quarter and six months ended June 30, 2020, these expenses totaled $5.2 million and $10.7 million respectively, and for the same periods in 2019, these expenses totaled $9.5 million and $13.2 million, respectively.

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Securities

6 Months Ended

Jun. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Securities

SECURITIES

The significant accounting policies related to securities are presented in Note 1, "Summary of Significant Accounting Policies" to the Consolidated Financial Statements in the Company's 2019 10-K.

A summary of the Company's securities portfolio by category and maturity is presented in the following tables.

Securities Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized				Fair Value		Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses						Gains		Losses
Securities Available-for-Sale
U.S. treasury securities	$	20,992	$	207	$	—	$	21,199	$	33,939	$	137	$	(1)	$	34,075
U.S. agency securities	640,253		4,166		(1,372)		643,047		249,502		758		(1,836)		248,424
Collateralized mortgage obligations ("CMOs")	1,624,609		49,059		(1,539)		1,672,129		1,547,805		14,893		(5,027)		1,557,671
Other mortgage-backed securities ("MBSs")	695,218		20,159		(237)		715,140		678,804		7,728		(1,848)		684,684
Municipal securities	229,414		10,410		(21)		239,803		228,632		5,898		(99)		234,431
Corporate debt securities	143,639		2,367		(1,462)		144,544		112,797		1,791		(487)		114,101
Total securities available-for-sale	$	3,354,125	$	86,368	$	(4,631)	$	3,435,862	$	2,851,479	$	31,205	$	(9,298)	$	2,873,386
Securities Held-to-Maturity
Municipal securities	$	19,848	$	48	$	—	$	19,896	$	21,997	$	—	$	(763)	$	21,234
Allowance for securities held-to-   maturity(1)	(220)						$	(220)
Total securities held-to-maturity, net	$	19,628	$	48	$	—	$	19,676
Equity Securities							$	43,954							$	42,136

⁽¹⁾The allowance for securities held-to-maturity was established upon adoption of CECL on January 1, 2020.

Accrued interest receivable on the securities portfolio totaled $13.6 million and $11.3 million as of June 30, 2020 and December 31, 2019, respectively, and is included in accrued interest receivable and other assets in the Consolidated Statements of Financial Condition.

Accounting guidance requires that the credit portion of a decline in fair value be recognized as an allowance for credit losses, established as a charge to expense through income. If a decline in fair value below carrying value is not attributable to credit deterioration and the Company does not intend to sell the security or believe it would not be more likely than not required to sell the security prior to recovery, the Company records the non-credit related portion of the decline in fair value in other comprehensive income (loss). In determining whether a decline in fair value of a security is credit related, the Company considers adverse conditions specific to the security, deterioration in economic conditions or market environment that may affect the value of the securities and related collateral, if any, events of default, changes to the credit rating of the security by a rating agency, and guarantees applicable to the security, among other factors.

Remaining Contractual Maturity of Securities

(Dollar amounts in thousands)

	As of June 30, 2020
	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	270,623	$	274,363	$	8,070	$	8,089
After one year to five years	185,159		187,718		5,452		5,465
After five years to ten years	578,516		586,512		3,315		3,323
After ten years	—		—		2,791		2,799
Securities that do not have a single contractual maturity date	2,319,827		2,387,269		—		—
Total	$	3,354,125	$	3,435,862	$	19,628	$	19,676

The carrying value of securities available-for-sale that were pledged to secure deposits or for other purposes as permitted or required by law totaled $1.5 billion as of June 30, 2020 and $1.3 billion as of December 31, 2019. No securities held-to-maturity were pledged as of June 30, 2020 or December 31, 2019.

There were realized losses of $1.0 million on securities available-for-sale for six months ended June 30, 2020 and no realized gains (losses) for the quarters ended June 30, 2020 and 2019 and six months ended June 30, 2019.

The following table presents the aggregate amount of unrealized losses and the aggregate related fair values of securities with unrealized losses as of June 30, 2020 and December 31, 2019.

Securities in an Unrealized Loss Position

(Dollar amounts in thousands)

		Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
As of June 30, 2020
Securities Available-for-Sale
U.S. agency securities	23	$	73,659	$	1,149	$	13,927	$	223	$	87,586	$	1,372
CMOs	41	139,578		1,379		33,967		160		173,545		1,539
MBSs	14	64,778		223		3,805		14		68,583		237
Municipal securities	1	1,745		21		—		—		1,745		21
Corporate debt securities	11	39,949		154		38,199		1,308		78,148		1,462
Total	90	$	319,709	$	2,926	$	89,898	$	1,705	$	409,607	$	4,631
As of December 31, 2019
Securities Available-for-Sale
U.S. treasury securities	5	$	4,966	$	1	$	—	$	—	$	4,966	$	1
U.S. agency securities	52	97,729		1,200		49,387		636		147,116		1,836
CMOs	148	187,470		2,177		412,083		2,850		599,553		5,027
MBSs	59	66,340		996		121,861		852		188,201		1,848
Municipal securities	16	9,384		89		3,104		10		12,488		99
Corporate debt securities	6	9,719		281		21,955		206		31,674		487
Total	286	$	375,608	$	4,744	$	608,390	$	4,554	$	983,998	$	9,298

Substantially all of the Company's CMOs and other MBSs are either backed by U.S. government-owned agencies or issued by U.S. government-sponsored enterprises. Municipal securities are issued by municipal authorities, and the majority are supported by third-party insurance or some other form of credit enhancement. Management does not believe any of these securities with unrealized losses as of June 30, 2020 represent impairment related to credit deterioration. These unrealized losses are attributed to changes in interest rates and temporary market movements. The Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis, which may be at maturity.

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Loans

6 Months Ended

Jun. 30, 2020

Loans and Leases Receivable Disclosure [Abstract]

Loans

LOANS

Loans Held-for-Investment

The following table presents the Company's loans held-for-investment by class.

Loan Portfolio

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Commercial and industrial	$	4,789,556	$	4,481,525
Agricultural	381,124		405,616
Commercial real estate:
Office, retail, and industrial	2,020,318		1,848,718
Multi-family	874,861		856,553
Construction	687,063		593,093
Other commercial real estate	1,475,937		1,383,708
Total commercial real estate	5,058,179		4,682,072
Total corporate loans, excluding Paycheck Protection Program ("PPP") loans	10,228,859		9,569,213
PPP loans	1,179,403		—
Total corporate loans	11,408,262		9,569,213
Home equity	892,867		851,454
1-4 family mortgages	2,175,322		1,927,078
Installment	457,207		492,585
Total consumer loans	3,525,396		3,271,117
Total loans	$	14,933,658	$	12,840,330
Deferred loan fees included in total loans	$	9,691	$	7,972
Overdrawn demand deposits included in total loans	7,676		10,675

Accrued interest receivable on the loan portfolio totaled $49.5 million and $48.4 million as of June 30, 2020 and December 31, 2019, respectively and is included in accrued interest receivable and other assets in the Consolidated Statements of Financial Condition.

The Company primarily lends to community-based and mid-sized businesses, commercial real estate customers, and consumers in its markets. Within these areas, the Company diversifies its loan portfolio by loan type, industry, and borrower.

It is the Company's policy to review each prospective credit to determine the appropriateness and the adequacy of security or collateral prior to making a loan. In the event of borrower default, the Company seeks recovery in compliance with state lending laws, the Company's lending standards, and credit monitoring and remediation procedures. A discussion of risk characteristics relevant to each portfolio segment is presented in Note 5, "Loans" to the Consolidated Financial Statements in the Company's 2019 10-K.

Loan Sales

The following table presents loan sales and purchases for the quarters and six months ended June 30, 2020 and 2019.

Loan Sales and Purchases

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Corporate loan sales
Proceeds from sales	$	295	$	2,178	$	4,598	$	5,376
Less book value of loans sold	289		2,132		4,477		5,248
Net gains on corporate loan sales(1)	6		46		121		128
1-4 family mortgage loan sales
Proceeds from sales	173,251		95,408		292,410		154,191
Less book value of loans sold	168,656		93,473		285,301		150,928
Net gains on 1-4 family mortgage loan sales(2)	4,595		1,935		7,109		3,263
Total net gains on loan sales	$	4,601	$	1,981	$	7,230	$	3,391
Corporate loan purchases(3)
Commercial and industrial	$	22,894	$	128,891	$	168,716	$	181,610
Office, retail, and industrial	—		1,711		—		1,711
Construction	3,258		1,432		3,897		2,266
Other commercial real estate	10,000		—		10,000		3,986
Total corporate loan purchases	$	36,152	$	132,034	$	182,613	$	189,573
Consumer loan purchases
Home equity	$	—	$	39,159	$	144,967	$	77,411
1-4 family mortgages	179,410		231,533		249,585		304,463
Total consumer loan purchases	$	179,410	$	270,692	$	394,552	$	381,874

⁽¹⁾Net gains on corporate loan sales are included in other service charges, commissions, and fees in the Condensed Consolidated Statements of Income.

⁽²⁾Net gains on 1-4 family mortgage loan sales are included in mortgage banking income in the Condensed Consolidated Statements of Income.

⁽³⁾Consists of the Company's portion of loan participations purchased.

The Company retained servicing responsibilities for a portion of the 1-4 family mortgage loans sold and collects servicing fees equal to a percentage of the outstanding principal balance. For additional disclosure related to the Company's obligations resulting from the sale of certain 1-4 family mortgage loans, see Note 13, "Commitments, Guarantees, and Contingent Liabilities."

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Acquired Loans

6 Months Ended

Jun. 30, 2020

Transfers and Servicing [Abstract]

Acquired Loans

ACQUIRED LOANS

The significant accounting policies related to acquired loans, which are classified as PCD and non-PCD at June 30, 2020, are presented in Note 1, "Summary of Significant Accounting Policies."

The following table presents the carrying amount of acquired loans as of June 30, 2020 and December 31, 2019.

Acquired Loans⁽¹⁾⁽²⁾

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	PCD		Non-PCD		Total		PCI		Non-PCI		Total
Acquired loans	$	243,207	$	1,516,157	$	1,759,364	$	167,183	$	1,216,133	$	1,383,316

⁽¹⁾Included in loans in the Consolidated Statements of Financial Condition.

⁽²⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

The outstanding balance of PCD loans was $284.3 million as of June 30, 2020 and the outstanding balance of PCI loans was $243.0 million as of December 31, 2019.

Total accretion on acquired loans for the quarters and six months ended June 30, 2020 and 2019 was $7.0 million and $13.9 million, respectively, and $10.3 million and $16.7 million for the same periods in 2019.

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Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS

6 Months Ended

Jun. 30, 2020

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS

PAST DUE LOANS, ALLOWANCE FOR CREDIT LOSSES, NON-ACCRUAL LOANS, AND TDRS

Past Due and Non-accrual Loans

The following table presents an aging analysis of the Company's past due loans as of June 30, 2020 and December 31, 2019 with balances presented on an amortized cost basis. The aging is determined without regard to accrual status. The table also presents non-performing loans, consisting of non-accrual loans (the majority of which are past due) and loans 90 days or more past due and still accruing interest, as of each balance sheet date.

Aging Analysis of Past Due Loans and Non-performing Loans by Class⁽¹⁾

(Dollar amounts in thousands)

	Aging Analysis (Accruing and Non-accrual)										Non-performing Loans
	Current		30-89 Days Past Due		90 Days or More Past Due		Total Past Due		Total Loans		Non- accrual		90 Days or More Past Due, Still Accruing Interest
As of June 30, 2020
Commercial and industrial	$	4,750,932	$	20,550	$	18,074	$	38,624	$	4,789,556	$	28,349	$	1,090
Agricultural	373,910		—		7,214		7,214		381,124		8,494		—
Commercial real estate:
Office, retail, and industrial	1,982,798		4,973		32,547		37,520		2,020,318		35,915		596
Multi-family	870,430		1,538		2,893		4,431		874,861		3,121		—
Construction	658,892		801		27,370		28,171		687,063		27,282		88
Other commercial real estate	1,458,874		5,145		11,918		17,063		1,475,937		18,372		25
Total commercial real estate	4,970,994		12,457		74,728		87,185		5,058,179		84,690		709
Total corporate loans, excluding PPP loans	10,095,836		33,007		100,016		133,023		10,228,859		121,533		1,799
PPP loans	1,179,403		—		—		—		1,179,403		—		—
Total corporate loans	11,275,239		33,007		100,016		133,023		11,408,262		121,533		1,799
Home equity	885,678		2,641		4,548		7,189		892,867		9,129		187
1-4 family mortgages	2,164,611		4,928		5,783		10,711		2,175,322		8,498		—
Installment	454,996		956		1,255		2,211		457,207		—		1,255
Total consumer loans	3,505,285		8,525		11,586		20,111		3,525,396		17,627		1,442
Total loans	$	14,780,524	$	41,532	$	111,602	$	153,134	$	14,933,658	$	139,160	$	3,241
As of December 31, 2019
Commercial and industrial	$	4,455,381	$	11,468	$	14,676	$	26,144	$	4,481,525	$	29,995	$	2,207
Agricultural	398,676		850		6,090		6,940		405,616		5,954		358
Commercial real estate:
Office, retail, and industrial	1,830,321		2,943		15,454		18,397		1,848,718		25,857		546
Multi-family	853,762		211		2,580		2,791		856,553		2,697		—
Construction	588,065		4,876		152		5,028		593,093		152		—
Other commercial real estate	1,377,678		3,233		2,797		6,030		1,383,708		4,729		529
Total commercial real estate	4,649,826		11,263		20,983		32,246		4,682,072		33,435		1,075
Total corporate loans	9,503,883		23,581		41,749		65,330		9,569,213		69,384		3,640
Home equity	841,908		4,992		4,554		9,546		851,454		8,443		146
1-4 family mortgages	1,917,648		5,452		3,978		9,430		1,927,078		4,442		1,203
Installment	491,406		1,167		12		1,179		492,585		—		12
Total consumer loans	3,250,962		11,611		8,544		20,155		3,271,117		12,885		1,361
Total loans	$	12,754,845	$	35,192	$	50,293	$	85,485	$	12,840,330	$	82,269	$	5,001

⁽¹⁾ Prior to the adoption of CECL on January 1, 2020, purchased credit impaired ("PCI") loans with an accretable yield were considered current and were not included in past due loan totals. In addition, PCI loans with an accretable yield were excluded from non-accrual loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals. In addition, an allowance for credit losses is established as of the acquisition date or upon the adoption of CECL for loans previously classified as PCI, as PCD loans are no longer recorded net of a credit-related acquisition adjustment.

Allowance for Credit Losses

The Company maintains an allowance for credit losses at a level deemed adequate by management to absorb estimated losses expected in the existing loan portfolio. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for the allowance for credit losses. A rollforward of the allowance for credit losses by portfolio segment for the quarters and six months ended June 30, 2020 and 2019 is presented in the table below. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)

	Commercial, Industrial, and Agricultural		Office, Retail, and Industrial		Multi- family		Construction		Other Commercial Real Estate		Consumer		Allowance for Unfunded Commitments		Total Allowance for Credit Losses
Quarter Ended June 30, 2020
Beginning balance	$	113,733	$	25,856	$	3,689	$	11,297	$	18,554	$	46,819	$	6,753	$	226,701
Allowance established for acquired PCD loans	378		—		—		—		—		—		872		1,250
Charge-offs	(5,673)		(3,092)		(9)		(798)		(31)		(4,631)		—		(14,234)
Recoveries	820		6		—		—		12		473		—		1,311
Net charge-offs	(4,853)		(3,086)		(9)		(798)		(19)		(4,158)		—		(12,923)
Provision for loan losses and other	14,719		1,671		1,631		1,023		3,327		10,278		—		32,649
Ending balance	$	123,977	$	24,441	$	5,311	$	11,522	$	21,862	$	52,939	$	7,625	$	247,677
Quarter Ended June 30, 2019
Beginning balance	$	64,685	$	7,679	$	2,216	$	2,131	$	4,930	$	21,938	$	1,200	$	104,779
Charge-offs	(6,516)		(1,605)		—		—		(329)		(2,974)		—		(11,424)
Recoveries	1,258		151		—		10		45		619		—		2,083
Net charge-offs	(5,258)		(1,454)		—		10		(284)		(2,355)		—		(9,341)
Provision for loan losses and other	6,937		1,270		(57)		(279)		351		3,269		—		11,491
Ending balance	$	66,364	$	7,495	$	2,159	$	1,862	$	4,997	$	22,852	$	1,200	$	106,929
Six Months Ended June 30, 2020
Beginning balance	$	62,830	$	7,580	$	2,950	$	1,697	$	6,408	$	26,557	$	1,200	$	109,222
Adjustment to apply   recent accounting   pronouncements(1)	20,159		11,686		397		10,300		11,427		16,235		5,553		75,757
Allowance established for acquired PCD loans	12,640		2,003		—		—		—		39		872		15,554
Charge-offs	(12,739)		(3,430)		(19)		(2,606)		(339)		(9,031)		—		(28,164)
Recoveries	1,979		15		5		—		156		972		—		3,127
Net charge-offs	(10,760)		(3,415)		(14)		(2,606)		(183)		(8,059)		—		(25,037)
Provision for loan   losses and other	39,108		6,587		1,978		2,131		4,210		18,167		—		72,181
Ending balance	$	123,977	$	24,441	$	5,311	$	11,522	$	21,862	$	52,939	$	7,625	$	247,677
Six Months Ended June 30, 2019
Beginning balance	$	63,276	$	7,900	$	2,464	$	2,173	$	4,934	$	21,472	$	1,200	$	103,419
Charge-offs	(12,967)		(2,233)		(340)		(6)		(539)		(6,116)		—		(22,201)
Recoveries	2,559		161		1		16		66		973		—		3,776
Net charge-offs	(10,408)		(2,072)		(339)		10		(473)		(5,143)		—		(18,425)
Provision for loan   losses and other	13,496		1,667		34		(321)		536		6,523		—		21,935
Ending balance	$	66,364	$	7,495	$	2,159	$	1,862	$	4,997	$	22,852	$	1,200	$	106,929

⁽¹⁾ As a result of accounting guidance adopted in the first quarter of 2020, the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

The allowance for credit losses increased from December 31, 2019 primarily due to the adoption of CECL and the estimated impact of the pandemic on the allowance for credit losses, which considers multiple macroeconomic scenarios of stressed GDP, unemployment, and housing price index, detailed portfolio reviews of elevated risk sectors, and the effects of governmental responses to the pandemic.

The table below provides a breakdown of loans and the related allowance for credit losses by portfolio segment as of June 30, 2020 and December 31, 2019.

Loans and Related Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)

	Loans								Allowance for Credit Losses
	Individually Evaluated		Collectively Evaluated		PCD/PCI(1)		Total		Individually Evaluated		Collectively Evaluated		PCD/PCI(1)		Total
As of June 30, 2020
Commercial, industrial,  agricultural	$	25,190	$	5,049,876	$	95,614	$	5,170,680	$	4,805	$	102,735	$	16,437	$	123,977
Commercial real estate:
Office, retail, and industrial	25,165		1,956,597		38,556		2,020,318		885		14,964		8,592		24,441
Multi-family	1,785		871,545		1,531		874,861		—		5,126		185		5,311
Construction	18,611		646,355		22,097		687,063		—		4,624		6,898		11,522
Other commercial real estate	3,806		1,410,080		62,051		1,475,937		44		10,332		11,486		21,862
Total commercial real estate	49,367		4,884,577		124,235		5,058,179		929		35,046		27,161		63,136
Total corporate loans, excluding PPP loans	74,557		9,934,453		219,849		10,228,859		5,734		137,781		43,598		187,113
PPP loans	—		1,179,403		—		1,179,403		—		—		—		—
Total corporate loans	74,557		11,113,856		219,849		11,408,262		5,734		137,781		43,598		187,113
Consumer	23		3,502,015		23,358		3,525,396		—		52,103		836		52,939
Allowance for unfunded commitments	—		—		—		—		—		7,625		—		7,625
Total loans	$	74,580	$	14,615,871	$	243,207	$	14,933,658	$	5,734	$	197,509	$	44,434	$	247,677
As of December 31, 2019
Commercial, industrial, and   agricultural	$	34,142	$	4,807,114	$	45,885	$	4,887,141	$	3,414	$	59,108	$	308	$	62,830
Commercial real estate:
Office, retail, and industrial	24,820		1,795,557		28,341		1,848,718		578		6,899		103		7,580
Multi-family	1,995		851,857		2,701		856,553		—		2,854		96		2,950
Construction	123		581,747		11,223		593,093		—		1,681		16		1,697
Other commercial real estate	3,241		1,323,635		56,832		1,383,708		—		4,867		1,541		6,408
Total commercial real estate	30,179		4,552,796		99,097		4,682,072		578		16,301		1,756		18,635
Total corporate loans	64,321		9,359,910		144,982		9,569,213		3,992		75,409		2,064		81,465
Consumer	—		3,248,916		22,201		3,271,117		—		25,424		1,133		26,557
Allowance for unfunded commitments	—		—		—		—		—		1,200		—		1,200
Total loans	$	64,321	$	12,608,826	$	167,183	$	12,840,330	$	3,992	$	102,033	$	3,197	$	109,222

⁽¹⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

The following table presents collateral-dependent loans, including PCD loans, without regard to accrual status by primary collateral type and non-accrual loans with no related allowance as of June 30, 2020. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Collateral-dependent Loans and Non-accrual Loans With No Related Allowance by Class

(Dollar amounts in thousands)

	Type of Collateral						Non-accrual Loans With No Related Allowance
	Real Estate		Blanket Lien		Equipment
Commercial and industrial	$	6,870	$	45,235	$	3,169	$	6,338
Agricultural	3,417		4,719		—		4,485
Commercial real estate:
Office, retail, and industrial	44,538		—		—		17,293
Multi-family	2,606		—		—		1,785
Construction	28,779		—		—		19,043
Other commercial real estate	33,845		—		—		11,789
Total commercial real estate	109,768		—		—		49,910
Total corporate loans	120,055		49,954		3,169		60,733
Home equity	244		—		—		123
1-4 family mortgages	2,665		—		—		527
Installment	—		—		—		—
Total consumer loans	2,909		—		—		650
Total loans	$	122,964	$	49,954	$	3,169	$	61,383

Loans Individually Evaluated

The following table presents loans individually evaluated by class of loan as of June 30, 2020 and December 31, 2019. PCD and PCI loans are excluded from this disclosure.

Loans Individually Evaluated by Class

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Recorded Investment In								Recorded Investment In
	Loans with No Specific Allowance		Loans with a Specific Allowance		Unpaid Principal Balance		Specific Allowance		Loans with No Specific Allowance		Loans with a Specific Allowance		Unpaid Principal Balance		Specific Allowance
Commercial and industrial	$	4,884	$	12,170	$	37,153	$	3,018	$	12,885	$	15,516	$	52,559	$	2,456
Agricultural	4,485		3,651		13,032		1,787		1,889		3,852		9,293		958
Commercial real estate:
Office, retail, and industrial	15,839		9,326		28,730		885		14,111		10,709		37,007		578
Multi-family	1,785		—		1,785		—		1,995		—		1,995		—
Construction	18,611		—		18,611		—		123		—		123		—
Other commercial real estate	3,357		449		4,103		44		3,241		—		3,495		—
Total commercial real estate	39,592		9,775		53,229		929		19,470		10,709		42,620		578
Total corporate loans	48,961		25,596		103,414		5,734		34,244		30,077		104,472		3,992
Consumer	23		—		23		—		—		—		—		—
Total non-accrual loans individually evaluated	$	48,984	$	25,596	$	103,437	$	5,734	$	34,244	$	30,077	$	104,472	$	3,992

Interest income recognized on non-accrual loans using the cash basis of accounting for the quarters ended and six months ended June 30, 2020 and 2019 was $110,000 and $388,000, respectively, and $69,000 and $148,000 for the same periods in 2019.

Credit Quality Indicators

Corporate loans and commitments are assessed for credit risk and assigned ratings based on various characteristics, such as the borrower's cash flow, leverage, and collateral. Ratings for commercial credits are reviewed at least annually or more often if events or circumstances arise that could impact the rating. The following tables present credit quality indicators for corporate and consumer loans on an amortized cost basis as of June 30, 2020 and net loan charge-offs for the six months ended June 30, 2020. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Corporate Loan Portfolio by Origination Year

(Dollar amounts in thousands)

	2020(1)		2019		2018		2017		2016		Prior		Revolving Loans		Total
Commercial, industrial, agricultural:
Pass	$	461,644	$	887,292	$	924,776	$	519,875	$	238,751	$	469,442	$	1,364,316	$	4,866,096
Special Mention(2)	3,508		6,520		31,435		4,676		8,527		17,568		80,597		152,831
Substandard(3)	384		4,376		26,729		17,862		16,583		15,804		33,172		114,910
Non-accrual(4)	—		1,771		2,381		8,505		4,806		6,682		12,698		36,843
Total commercial, industrial, agricultural	$	465,536	$	899,959	$	985,321	$	550,918	$	268,667	$	509,496	$	1,490,783	$	5,170,680
Commercial, industrial, agricultural, net loan charge-offs	$	—	$	250	$	946	$	1,058	$	617	$	1,853	$	6,036	$	10,760
Office, retail, and industrial:
Pass	$	95,291	$	266,479	$	225,938	$	348,121	$	302,430	$	677,880	$	5,491	$	1,921,630
Special Mention(2)	1,173		655		3,280		5,091		15,439		12,914		—		38,552
Substandard(3)	—		—		—		337		1,514		22,370		—		24,221
Non-accrual(4)	—		—		132		—		10,238		25,545		—		35,915
Total office, retail, and industrial	$	96,464	$	267,134	$	229,350	$	353,549	$	329,621	$	738,709	$	5,491	$	2,020,318
Office, retail, and industrial net loan charge-offs	$	—	$	333	$	156	$	—	$	1,628	$	1,298	$	—	$	3,415
Multi-family:
Pass	$	125,328	$	174,802	$	84,791	$	101,492	$	101,846	$	239,713	$	36,111	$	864,083
Special Mention(2)	—		—		—		—		358		1,416		—		1,774
Substandard(3)	—		—		387		81		—		5,415		—		5,883
Non-accrual(4)	—		—		—		1,785		237		1,099		—		3,121
Total multi-family	$	125,328	$	174,802	$	85,178	$	103,358	$	102,441	$	247,643	$	36,111	$	874,861
Multi-family net loan charge-offs	$	—	$	3	$	—	$	1	$	—	$	10	$	—	$	14
Construction:
Pass	$	33,890	$	151,849	$	171,480	$	101,781	$	71,001	$	70,950	$	33,016	$	633,967
Special Mention(2)	—		—		45		3,032		14,221		1,228		—		18,526
Substandard(3)	—		—		—		—		—		7,288		—		7,288
Non-accrual(4)	—		—		—		—		—		25,591		1,691		27,282
Total construction	$	33,890	$	151,849	$	171,525	$	104,813	$	85,222	$	105,057	$	34,707	$	687,063
Construction net loan charge-offs	$	—	$	118	$	—	$	798	$	—	$	1,690	$	—	$	2,606
Other commercial real estate:
Pass	$	61,056	$	195,768	$	269,526	$	226,064	$	125,249	$	466,436	$	27,553	$	1,371,652
Special Mention(2)	—		3,532		7,589		6,887		11,219		15,463		—		44,690
Substandard(3)	—		—		—		1,400		4,224		35,599		—		41,223
Non-accrual(4)	—		—		674		4,150		1,078		12,377		93		18,372
Total other commercial real estate	$	61,056	$	199,300	$	277,789	$	238,501	$	141,770	$	529,875	$	27,646	$	1,475,937
Other commercial real estate net loan charge- offs	$	—	$	38	$	1	$	—	$	183	$	(39)	$	—	$	183

⁽¹⁾Represents year-to-date loans originated during 2020.

⁽²⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽³⁾Loans categorized as substandard exhibit well-defined weaknesses that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured, and collection of principal and interest is expected within a reasonable time.

⁽⁴⁾Loans categorized as non-accrual exhibit well-defined weaknesses that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.

Consumer Loan Portfolio by Origination Year

(Dollar amounts in thousands)

	2020(1)		2019		2018		2017		2016		Prior		Revolving Loans		Total
Home equity:
Performing	$	8,231	$	48,696	$	27,783	$	13,809	$	11,878	$	57,053	$	716,288	$	883,738
Non-accrual	—		22		125		264		482		6,801		1,435		9,129
Total home equity	$	8,231	$	48,718	$	27,908	$	14,073	$	12,360	$	63,854	$	717,723	$	892,867
Home equity net loan charge-offs	$	—	$	—	$	1	$	—	$	1	$	42	$	(14)	$	30
1-4 family mortgages:
Performing	$	597,506	$	676,898	$	311,884	$	158,230	$	181,912	$	240,394	$	—	$	2,166,824
Non-accrual	—		—		438		83		63		7,914		—		8,498
Total 1-4 family mortgages	$	597,506	$	676,898	$	312,322	$	158,313	$	181,975	$	248,308	$	—	$	2,175,322
1-4 family mortgages net loan charge-offs	$	—	$	—	$	4	$	—	$	7	$	735	$	—	$	746
Installment:
Performing	$	59,971	$	185,919	$	107,220	$	45,108	$	17,563	$	20,662	$	20,764	$	457,207
Non-accrual	—		—		—		—		—		—		—		—
Total installment	$	59,971	$	185,919	$	107,220	$	45,108	$	17,563	$	20,662	$	20,764	$	457,207
Installment net loan charge-offs	$	44	$	3,757	$	2,200	$	775	$	85	$	393	$	29	$	7,283

⁽¹⁾Represents year-to-date loans originated during 2020.

During the quarter and six months ended June 30, 2020, $16.8 million and $23.8 million, respectively, of revolving loans converted to term loans.

The following tables present credit quality indicators by class for corporate and consumer loans on an amortized cost basis as of December 31, 2019.

Corporate Credit Quality Indicators by Class

(Dollar amounts in thousands)

	Pass		Special Mention(1)		Substandard(2)		Non-accrual(3)		Total
As of December 31, 2019
Commercial and industrial	$	4,324,709	$	47,665	$	79,156	$	29,995	$	4,481,525
Agricultural	350,827		32,764		16,071		5,954		405,616
Commercial real estate:
Office, retail, and industrial	1,747,287		42,230		33,344		25,857		1,848,718
Multi-family	839,615		8,279		5,962		2,697		856,553
Construction	564,495		17,977		10,469		152		593,093
Other commercial real estate	1,295,155		39,788		44,036		4,729		1,383,708
Total commercial real estate	4,446,552		108,274		93,811		33,435		4,682,072
Total corporate loans	$	9,122,088	$	188,703	$	189,038	$	69,384	$	9,569,213

⁽¹⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽²⁾Loans categorized as substandard exhibit a well-defined weakness that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured and collection of principal and interest is expected within a reasonable time.

⁽³⁾Loans categorized as non-accrual exhibit a well-defined weakness that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.

Consumer Credit Quality Indicators by Class

(Dollar amounts in thousands)

	Performing		Non-accrual		Total
As of December 31, 2019
Home equity	$	843,011	$	8,443	$	851,454
1-4 family mortgages	1,922,636		4,442		1,927,078
Installment	492,585		—		492,585
Total consumer loans	$	3,258,232	$	12,885	$	3,271,117

TDRs

TDRs are generally performed at the request of the individual borrower and may include forgiveness of principal, reduction in interest rates, changes in payments, and maturity date extensions. The table below presents TDRs by class as of June 30, 2020 and December 31, 2019. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for TDRs.

TDRs by Class

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Accruing		Non-accrual(1)		Total		Accruing		Non-accrual(1)		Total
Commercial and industrial	$	188	$	9,336	$	9,524	$	227	$	16,420	$	16,647
Agricultural	—		—		—		—		—		—
Commercial real estate:
Office, retail, and industrial	—		2,340		2,340		—		3,600		3,600
Multi-family	160		—		160		163		—		163
Construction	—		—		—		—		—		—
Other commercial real estate	198		—		198		170		—		170
Total commercial real estate	358		2,340		2,698		333		3,600		3,933
Total corporate loans	546		11,676		12,222		560		20,020		20,580
Home equity	31		179		210		36		240		276
1-4 family mortgages	624		238		862		637		—		637
Installment	—		—		—		—		254		254
Total consumer loans	655		417		1,072		673		494		1,167
Total loans	$	1,201	$	12,093	$	13,294	$	1,233	$	20,514	$	21,747

⁽¹⁾These TDRs are included in non-accrual loans in the preceding tables.

TDRs are included in the calculation of the allowance for credit losses in the same manner as non-accrual loans. As of June 30, 2020 and December 31, 2019, there were $2.4 million and $2.2 million of specific allowances, respectively, related to TDRs.

There were no material restructurings during the quarters and six months ended June 30, 2020 and 2019.

Accruing TDRs that do not perform in accordance with their modified terms are transferred to non-accrual. There were no material TDRs that defaulted within twelve months of the restructure date during the quarters and six months ended June 30, 2020 and 2019.

A rollforward of the carrying value of TDRs for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

TDR Rollforward

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Accruing
Beginning balance	$	1,216	$	1,844	$	1,233	$	1,866
Additions	—		—		—		12
Net payments	(15)		(20)		(32)		(54)
Net transfers to non-accrual	—		(383)		—		(383)
Ending balance	1,201		1,441		1,201		1,441
Non-accrual
Beginning balance	17,917		9,375		20,514		6,612
Additions	—		—		934		—
Net (payments) advances	(2,595)		(1,447)		(3,253)		1,474
Charge-offs	(3,229)		(470)		(6,102)		(628)
Net transfers from accruing	—		383		—		383
Ending balance	12,093		7,841		12,093		7,841
Total TDRs	$	13,294	$	9,282	$	13,294	$	9,282

There were $813,000 and $530,000 of commitments to lend additional funds to borrowers with TDRs as of June 30, 2020 and December 31, 2019, respectively.

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Lease Obligations

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Lease Obligations

LEASE OBLIGATIONS

The Company has the right to utilize certain premises under non-cancelable operating leases with varying maturity dates through the year ending December 31, 2059. As of June 30, 2020, the weighted-average remaining lease term on these leases was 10.70 years. Various leases contain renewal or termination options controlled by the Company or options to purchase the leased property during or at the expiration of the lease period at specific prices. Some leases contain escalation clauses calling for rentals to be adjusted for increased real estate taxes and other operating expenses or proportionately adjusted for increases in consumer or other price indices. Variable payments for real estate taxes and other operating expenses are considered to be non-lease components and are excluded from the determination of the lease liability. In addition, the Company leases or subleases certain real estate to third-parties. The following summary reflects the future minimum payments by year required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year and a reconciliation of those payments to the Company's lease liability as of June 30, 2020.

Lease Liability

(Dollar amounts in thousands)

	As of    June 30, 2020
Year Ending December 31,
2020	$	9,466
2021	18,785
2022	18,711
2023	18,811
2024	18,530
2025 and thereafter	105,995
Total minimum lease payments	190,298
Discount(1)	(28,752)
Lease liability(2)	$	161,546

⁽¹⁾Represents the net present value adjustment related to minimum lease payments.

⁽²⁾Included in accrued interest payable and other liabilities in the Consolidated Statements of Financial Condition.

The discount rate for the Company's operating leases is the rate implicit in the lease and, if that rate cannot be readily determined, the Company's incremental borrowing rate. The weighted-average discount rate on the Company's operating leases was 2.96% as of June 30, 2020.

As of June 30, 2020, right-of-use assets of $141.2 million associated with lease liabilities were included in accrued interest receivable and other assets in the Consolidated Statements of Financial Condition.

The following table presents net operating lease expense for the quarters and six months ended June 30, 2020 and 2019.

Net Operating Lease Expense

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Lease expense charged to operations	$	4,839	$	4,426	$	9,514	$	8,486
Rental income from premises leased to others (1)	(183)		(165)		(398)		(322)
Net operating lease expense	$	4,656	$	4,261	$	9,116	$	8,164

⁽¹⁾Included as reductions to net occupancy and equipment expense in the Condensed Consolidated Statements of Income.

During 2016, the Bank completed a sale-leaseback transaction, whereby the Bank sold to a third-party 55 branches and concurrently entered into triple net lease agreements with certain affiliates of the third-party for each of the branches sold. The sale-leaseback transaction resulted in a pre-tax gain of $88.0 million, net of transaction related expenses, of which $5.5 million was immediately recognized in earnings. Remaining deferred pre-tax gains were $65.5 million as of December 31, 2018. Upon adoption of new lease guidance on January 1, 2019, the remaining after-tax gain of $47.3 million was recognized as a cumulative-effect adjustment to equity in the Consolidated Statements of Financial Condition.

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Borrowed Funds

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Borrowed Funds

BORROWED FUNDS

The following table summarizes the Company's borrowed funds by funding source.

Summary of Borrowed Funds

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Securities sold under agreements to repurchase	$	130,667	$	103,515
Federal funds purchased	200,000		160,000
FHLB advances	1,974,528		1,395,243
Total borrowed funds	$	2,305,195	$	1,658,758

Securities sold under agreements to repurchase are treated as financings and the obligations to repurchase securities sold are included as a liability in the Consolidated Statements of Financial Condition. Repurchase agreements are secured by U.S. treasury and agency securities which are held in third-party pledge accounts if required. The securities underlying the agreements remain in the respective asset accounts. As of June 30, 2020, the Company did not have amounts at risk under repurchase agreements with any individual counterparty or group of counterparties that exceeded 10% of stockholders' equity.

The Bank is a member of the FHLB and has access to term financing from the FHLB. These advances are secured by designated assets that may include qualifying commercial real estate, residential and multi-family mortgages, home equity loans, and certain municipal and mortgage-backed securities. As of June 30, 2020, the Company held various short-term FHLB advances with fixed interest rates that range from 0.00% to 1.97% and maturity dates that range from July 1, 2020 to March 4, 2030.

The Company hedges interest rates on borrowed funds using interest rate swaps through which the Company receives variable amounts and pays fixed amounts. See Note 12 "Derivative Instruments and Hedging Activities" for a detailed discussion of interest rate swaps.

The following table presents short-term credit lines available for use, for which the Company did not have an outstanding balance as of June 30, 2020 and December 31, 2019.

Short-Term Credit Lines Available for Use

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
FRB's Discount Window Primary Credit Program	$	803,068	$	874,256
Available federal funds lines	814,000		718,000
Correspondent bank line of credit	50,000		50,000

On September 27, 2016, the Company entered into a loan agreement with U.S. Bank National Association providing for a $50.0 million short-term, unsecured revolving credit facility. On September 26, 2019, the Company entered into a third amendment to this credit facility, which extends the maturity to September 26, 2020. Advances will bear interest at a rate equal to one-month LIBOR plus 1.75%, adjusted on a monthly basis, and the Company must pay an unused facility fee equal to 0.35% per annum on a quarterly basis. Management expects to use this line of credit for general corporate purposes. As of June 30, 2020, no amount was outstanding under the facility.

A discussion of terms relevant to senior and subordinated debt is presented in Note 13, "Senior and Subordinated Debt" to the Consolidated Financial Statements in the Company's 2019 10-K.

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Material Transactions Affecting Stockholders' Equity

3 Months Ended

Jun. 30, 2020

Equity [Abstract]

Material Transactions Affecting Stockholders' Equity

MATERIAL TRANSACTIONS AFFECTING STOCKHOLDERS' EQUITY

Issuance of Common Stock

On March 9, 2020, the Company issued 4.9 million shares of its common stock with a market value of $14.58 per share at issuance as part of the consideration in the Park Bank acquisition. Additional information regarding the Park Bank acquisition is presented in Note 3, "Acquisitions".

Issuance of Preferred Stock

During the second quarter of 2020, the Company issued 4.3 million depositary shares, each representing a 1/40th interest in a share of the Company's 7.000% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, and 4.9 million depositary shares, each representing a 1/40th interest in a share of the Company's Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, for an aggregate of $230.5 million. The Company received proceeds of $221.3 million, net of underwriting discounts and commissions and issuance costs and expects to use the proceeds for general corporate purposes.

Stock Repurchases

On March 19, 2019, the Company announced a stock repurchase program that authorized the Company to repurchase up to $180 million of its common stock from time to time on the open market or in privately negotiated transactions, at the discretion of the Company. 

On February 26, 2020, the Company announced a new stock repurchase program authorizing the discretionary repurchase of up to $200 million of its outstanding common stock through December 31, 2021. This program replaced the Company's prior $180 million stock repurchase program, which was set to expire in March 2020. The Company suspended repurchases in March as it shifted its capital deployment strategy in response to the pandemic. Prior to the suspension, the Company had repurchased 1.2 million shares of its common stock at a total cost of $22.6 million during the six months ended June 30, 2020.

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Earnings Per Common Share

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Earnings Per Common Share

EARNINGS PER COMMON SHARE

The table below displays the calculation of basic and diluted earnings per common share ("EPS").

Basic and Diluted EPS

(Amounts in thousands, except per share data)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Net income	$	19,064	$	47,014	$	38,670	$	93,072
Preferred dividends	(1,037)		—		(1,037)		—
Net income applicable to unvested restricted shares	(187)		(389)		(379)		(792)
Net income applicable to common shares	$	17,840	$	46,625	$	37,254	$	92,280
Weighted-average common shares outstanding:
Weighted-average common shares outstanding (basic)	113,145		108,467		111,533		107,126
Dilutive effect of common stock equivalents	191		—		339		—
Weighted-average diluted common shares outstanding	113,336		108,467		111,872		107,126
Basic EPS	$	0.16	$	0.43	$	0.33	$	0.86
Diluted EPS	$	0.16	$	0.43	$	0.33	$	0.86

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Derivative Instruments and Hedging Activities

6 Months Ended

Jun. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

In the ordinary course of business, the Company enters into derivative transactions as part of its overall interest rate risk management strategy. The significant accounting policies related to derivative instruments and hedging activities are presented in Note 1, "Summary of Significant Accounting Policies."

Cash Flow Hedges

As of June 30, 2020, the Company hedged $430.0 million of certain corporate variable rate loans using interest rate swaps through which the Company receives fixed amounts and pays variable amounts. The Company also hedged $1.6 billion of borrowed funds using interest rate swaps through which the Company receives variable amounts and pays fixed amounts. These transactions allow the Company to add stability to net interest income and manage its exposure to interest rate movements.

Interest rate swaps totaling $1.1 billion began on various dates between December of 2018 and April of 2020 and mature between October of 2021 and March of 2025. The remaining forward starting interest rate swaps totaling $485.0 million begin at various dates between July of 2020 and February of 2021 and mature between July of 2022 and August of 2024. The weighted-average fixed interest rate to be paid on these interest rate swaps that have not yet begun was 1.86% as of June 30, 2020. These derivative contracts are designated as cash flow hedges.

Cash Flow Hedges

(Dollar amounts in thousands)

	As of
	June 30, 2020			December 31, 2019
Gross notional amount outstanding	$	2,035,000		$	1,905,000
Derivative asset fair value in other assets(1)	6,053			727
Derivative liability fair value in other liabilities(1)	198			(119)
Weighted-average interest rate received	0.96		%	1.88		%
Weighted-average interest rate paid	0.77		%	1.74		%
Weighted-average maturity (in years)	2.30			1.18

⁽¹⁾Certain cash flow hedges are transacted through a clearinghouse ("centrally cleared") and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

Changes in the fair value of cash flow hedges are recorded in accumulated other comprehensive income (loss) on an after-tax basis and are subsequently reclassified to interest income or expense in the period that the forecasted hedged item impacts earnings. As of June 30, 2020, the Company estimates that $4.3 million will be reclassified from accumulated other comprehensive income (loss) as a decrease to interest income over the next twelve months.

Other Derivative Instruments

The Company also enters into derivative transactions through capital market products with its commercial customers and simultaneously enters into an offsetting interest rate derivative transaction with third-parties. This transaction allows the Company's customers to effectively convert a variable rate loan into a fixed rate loan. Due to the offsetting nature of these transactions, the Company does not apply hedge accounting treatment. The Company's credit exposure on these derivative transactions results primarily from counterparty credit risk. The credit valuation adjustment ("CVA") is a fair value adjustment to the derivative to account for this risk. As of June 30, 2020 and December 31, 2019, the Company's credit exposure was fully secured by the underlying collateral on customer loans and mitigated through netting arrangements with third-parties; therefore, no CVA was recorded. Capital market products income related to commercial customer derivative instruments totaled $694,000 and $5.4 million for the quarter and six months ended June 30, 2020, respectively, and were $2.2 million and $3.4 million for the quarter and six months ended June 30, 2019, respectively.

Other Derivative Instruments

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Gross notional amount outstanding	$	4,589,018	$	4,340,384
Derivative asset fair value in other assets(1)	183,938		61,709
Derivative liability fair value in other liabilities(1)	(55,026)		(18,416)
Fair value of derivative(2)	56,025		18,856

⁽¹⁾Certain other derivative instruments are centrally cleared and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

⁽²⁾This amount represents the fair value if credit risk related contingent features were triggered.

The Company occasionally enters into risk participation agreements with counterparty banks to transfer or assume a portion of the credit risk related to customer transactions. The amounts of these instruments were not material for any periods presented. The Company had no other derivative instruments as of June 30, 2020 and December 31, 2019. The Company does not enter into derivative transactions for purely speculative purposes.

The following table presents the impact of derivative instruments on comprehensive income (loss) and the reclassification of gains (losses) from accumulated other comprehensive income (loss) to net interest income for the quarters and six months ended June 30, 2020 and 2019.

Cash Flow Hedge Accounting on AOCI

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Gains (losses) recognized in other comprehensive income
Interest rate swaps in interest income	$	5,951	$	5,944	$	27,955	$	9,297
Interest rate swaps in interest expense	(1,276)		(7,816)		(13,685)		(11,996)
Reclassification of gains (losses) included in net income
Interest rate swaps in interest income	$	2,624	$	1,355	$	3,069	$	2,748
Interest rate swaps in interest expense	—		(1,924)		—		(3,948)

The following table presents the impact of derivative instruments on net interest income for the quarters and six months ended June 30, 2020 and 2019.

Hedge Income

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Cash Flow Hedges
Interest rate swaps in interest income	$	2,624	$	1,355	$	3,069	$	2,748
Interest rate swaps in interest expense	—		(1,924)		—		(3,948)
Total cash flow hedges	$	2,624	$	(569)	$	3,069	$	(1,200)

Credit Risk

Derivative instruments are inherently subject to credit risk, which represents the Company's risk of loss when the counterparty to a derivative contract fails to perform according to the terms of the agreement. Credit risk is managed by limiting and collateralizing the aggregate amount of net unrealized losses by transaction, monitoring the size and the maturity structure of the derivatives, and applying uniform credit standards. Company policy establishes limits on credit exposure to any single counterparty. In addition, the Company established bilateral collateral agreements with derivative counterparties that provide for exchanges of marketable securities or cash to collateralize either party's net losses above a stated minimum threshold. As of June 30, 2020 and December 31, 2019, these collateral agreements covered 100% of the fair value of the Company's outstanding derivatives. Derivative assets and liabilities are presented gross, rather than net, of pledged collateral amounts.

Certain derivative instruments are subject to master netting agreements with counterparties. The Company records these transactions at their gross fair values and does not offset derivative assets and liabilities in the Consolidated Statements of Financial Condition. The following table presents the fair value of the Company's derivatives and offsetting positions as of June 30, 2020 and December 31, 2019.

Fair Value of Offsetting Derivatives

(Dollar amounts in thousands)

	As of June 30, 2020				As of December 31, 2019
	Assets		Liabilities		Assets		Liabilities
Gross amounts recognized	$	189,991	$	54,828	$	62,436	$	18,535
Less: amounts offset in the Consolidated Statements of Financial Condition	—		—		—		—
Net amount presented in the Consolidated Statements of   Financial Condition(1)	189,991		54,828		62,436		18,535
Gross amounts not offset in the Consolidated Statements of Financial Condition:
Offsetting derivative positions	(7,495)		(7,495)		(2,674)		(2,674)
Cash collateral pledged	—		(48,430)		—		(15,861)
Net credit exposure	$	182,496	$	(1,097)	$	59,762	$	—

⁽¹⁾Included in other assets or other liabilities in the Consolidated Statements of Financial Condition.

As of June 30, 2020 and December 31, 2019, the Company's derivative instruments generally contained provisions that require the Company's debt to remain above a certain credit rating by each of the major credit rating agencies or that the Company maintain certain capital levels. If the Company's debt were to fall below that credit rating or the Company's capital were to fall below the required levels, it would be in violation of those provisions, and the counterparties to the derivative instruments could terminate the swap transaction and demand cash settlement of the derivative instrument in an amount equal to the derivative liability fair value. As of June 30, 2020 and December 31, 2019 the Company was in compliance with these provisions.

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Commitments, Guarantees, and Contingent Liabilities

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments, Guarantees, and Contingent Liabilities

COMMITMENTS, GUARANTEES, AND CONTINGENT LIABILITIES

Credit Commitments and Guarantees

In the normal course of business, the Company enters into a variety of financial instruments with off-balance sheet risk to meet the financing needs of its customers and to conduct lending activities, including commitments to extend credit as well as standby and commercial letters of credit. These instruments involve elements of credit and interest rate risk in excess of the amount recognized in the Consolidated Statements of Financial Condition.

Contractual or Notional Amounts of Financial Instruments

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Commitments to extend credit:
Commercial, industrial, and agricultural	$	2,276,196	$	1,852,040
Commercial real estate	324,659		296,053
Home equity	578,920		576,956
Other commitments(1)	251,716		251,093
Total commitments to extend credit	$	3,431,491	$	2,976,142
Letters of credit	$	100,827	$	103,684

⁽¹⁾Other commitments includes installment and overdraft protection program commitments.

Commitments to extend credit are agreements to lend funds to a customer, subject to contractual terms and covenants. Commitments generally have fixed expiration dates or other termination clauses, variable interest rates, and fee requirements, when applicable. Since many of the commitments are expected to expire without being drawn, the total commitment amounts do not necessarily represent future cash flow requirements.

In the event of a customer's non-performance, the Company's credit loss exposure is equal to the contractual amount of the commitments. The credit risk is essentially the same as extending loans to customers for the full contractual amount. The Company uses the same credit policies for credit commitments as its loans and minimizes exposure to credit loss through various collateral requirements.

Letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third-party. Letters of credit generally are contingent on the failure of the customer to perform according to the terms of the contract with the third-party and are often issued in favor of a municipality where construction is taking place to ensure the borrower adequately completes the construction. Commercial letters of credit are issued to facilitate transactions between a customer and a third-party based on agreed upon terms.

The maximum potential future payments guaranteed by the Company under letters of credit arrangements are equal to the contractual amount of the commitment. If a commitment is funded, the Company may seek recourse through the liquidation of the underlying collateral, including real estate, production plants and property, marketable securities, or receipt of cash.

As a result of the sale of certain 1-4 family mortgage loans, the Company is contractually obligated to repurchase early payment default loans or loans that do not meet underwriting requirements at recorded value. In accordance with the sales agreements, there is no limitation to the maximum potential future payments or expiration of the Company's recourse obligation. There were no material loan repurchases during the quarters and six months ended June 30, 2020 and 2019.

Legal Proceedings

In the ordinary course of business, there were certain legal proceedings pending against the Company and its subsidiaries at June 30, 2020. While the outcome of any legal proceeding is inherently uncertain, based on information currently available, the Company's management does not expect that any liabilities arising from pending legal matters will have a material adverse effect on the Company's business, financial position, or results of operations.

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Fair Value

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value

FAIR VALUE

Fair value represents the amount expected to be received to sell an asset or paid to transfer a liability in its principal or most advantageous market in an orderly transaction between market participants at the measurement date. In accordance with fair value accounting guidance, the Company measures, records, and reports various types of assets and liabilities at fair value on either a recurring or non-recurring basis in the Consolidated Statements of Financial Condition. Those assets and liabilities are presented below in the sections titled "Assets and Liabilities Required to be Measured at Fair Value on a Recurring Basis" and "Assets and Liabilities Required to be Measured at Fair Value on a Non-Recurring Basis."

Other assets and liabilities are not required to be measured at fair value in the Consolidated Statements of Financial Condition, but must be disclosed at fair value. See the "Fair Value Measurements of Other Financial Instruments" section of this note. Any aggregation of the estimated fair values presented in this note does not represent the value of the Company.

Depending on the nature of the asset or liability, the Company uses various valuation methodologies and assumptions to estimate fair value. GAAP provides a three-tiered fair value hierarchy based on the inputs used to measure fair value. The hierarchy is defined as follows:

•Level 1 – Quoted prices in active markets for identical assets or liabilities.

•Level 2 – Observable inputs other than level 1 prices, such as quoted prices for similar instruments, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

•Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These inputs require significant management judgment or estimation, some of which use model-based techniques and may be internally developed.

Assets and liabilities are assigned to a level within the fair value hierarchy based on the lowest level of significant input used to measure fair value. Assets and liabilities may change levels within the fair value hierarchy due to market conditions or other circumstances. Those transfers are recognized on the date of the event that prompted the transfer. There were no transfers of assets or liabilities required to be measured at fair value on a recurring basis between levels of the fair value hierarchy during the periods presented.

Assets and Liabilities Required to be Measured at Fair Value on a Recurring Basis

The following table provides the fair value for assets and liabilities required to be measured at fair value on a recurring basis in the Consolidated Statements of Financial Condition by level in the fair value hierarchy.

Recurring Fair Value Measurements

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Equity securities	$	24,075	$	14,879	$	—	$	23,703	$	13,400	$	—
Securities available-for-sale
U.S. treasury securities	21,199		—		—		34,075		—		—
U.S. agency securities	—		643,047		—		—		248,424		—
CMOs	—		1,672,129		—		—		1,557,671		—
MBSs	—		715,140		—		—		684,684		—
Municipal securities	—		239,803		—		—		234,431		—
Corporate debt securities	—		144,544		—		—		114,101		—
Total securities available-for-sale	21,199		3,414,663		—		34,075		2,839,311		—
Mortgage servicing rights ("MSRs")(1)	—		—		4,464		—		—		5,858
Derivative assets(1)	—		189,991		—		—		62,436		—
Liabilities
Derivative liabilities(2)	$	—	$	54,828	$	—	$	—	$	18,535	$	—

⁽¹⁾Included in other assets in the Consolidated Statements of Financial Condition.

⁽²⁾Included in other liabilities in the Consolidated Statements of Financial Condition.

The following sections describe the specific valuation techniques and inputs used to measure financial assets and liabilities at fair value.

Equity Securities

The Company's equity securities consist primarily of community development investments and certain diversified investment securities held in a grantor trust for participants in the Company's nonqualified deferred compensation plan that are invested in money market and mutual funds. The fair value of certain community development investments is based on quoted prices in active markets or market prices for similar securities obtained from external pricing services or dealer market participants and is classified in level 2 of the fair value hierarchy. As of June 30, 2020, the fair value of certain community development investments totaling $5.0 million was based on the net asset value per share ("NAV") practical expedient and can be redeemed at any month end with 30 days notice. Since these investments are measured at fair value using the NAV practical expedient, they are not classified in the fair value hierarchy. The fair value of the money market and mutual funds is based on quoted market prices in active exchange markets and is classified in level 1 of the fair value hierarchy.

Securities Available-for-Sale

The Company's securities available-for-sale are primarily fixed income instruments that are not quoted on an exchange but may be traded in active markets. The fair values for these securities are based on quoted prices in active markets or market prices for similar securities obtained from external pricing services or dealer market participants and are classified in level 2 of the fair value hierarchy. The fair value of U.S. treasury securities is based on quoted market prices in active exchange markets and is classified in level 1 of the fair value hierarchy. Quarterly, the Company evaluates the methodologies used by its external pricing services to estimate the fair value of these securities in order to determine whether the valuations represent an exit price in the Company's principal markets.

MSRs

The Company services loans for others totaling $675.6 million and $653.7 million as of June 30, 2020 and December 31, 2019, respectively. These loans are owned by third-parties and are not included in the Consolidated Statements of Financial Condition. The Company determines the fair value of MSRs by estimating the present value of expected future cash flows associated with the mortgage loans being serviced and classifies them in level 3 of the fair value hierarchy. The following table presents the ranges of significant, unobservable inputs used by the Company to determine the fair value of MSRs as of June 30, 2020 and December 31, 2019.

Significant Unobservable Inputs Used in the Valuation of MSRs

	As of
	June 30, 2020				December 31, 2019
Prepayment speed	7.6	%	-	14.9%	6.7	%	-	12.0%
Maturity (months)	16		-	88	18		-	94
Discount rate	9.4	%	-	12.0%	9.3	%	-	12.0%

The impact of changes in these key inputs could result in a significantly higher or lower fair value measurement for MSRs. Significant increases in expected prepayment speeds and discount rates have negative impacts on the valuation. Higher maturity assumptions have a favorable effect on the estimated fair value.

A rollforward of the carrying value of MSRs for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

Carrying Value of MSRs

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Beginning balance	$	4,874	$	6,228	$	5,858	$	6,730
New MSRs	745		204		901		457
Total gains (losses) included in earnings(1):
Changes in valuation inputs and assumptions	(750)		(389)		(1,658)		(989)
Other changes in fair value(2)	(405)		(212)		(637)		(367)
Ending balance(3)	$	4,464	$	5,831	$	4,464	$	5,831
Contractual servicing fees earned(1)	$	394	$	390	$	797	$	771

⁽¹⁾Included in mortgage banking income in the Condensed Consolidated Statements of Income and related to assets held as of June 30, 2020 and 2019.

⁽²⁾Primarily represents changes in expected future cash flows due to payoffs and paydowns.

⁽³⁾Included in other assets in the Consolidated Statements of Financial Condition.

Derivative Assets and Derivative Liabilities

The Company enters into interest rate swaps and derivative transactions with commercial customers. These derivative transactions are executed in the dealer market, and pricing is based on market quotes obtained from the counterparties. The market quotes were developed using market observable inputs, which primarily include LIBOR. Therefore, derivatives are classified in level 2 of the fair value hierarchy. For its derivative assets and liabilities, the Company also considers non-performance risk, including the likelihood of default by itself and its counterparties, when evaluating whether the market quotes from the counterparty are representative of an exit price.

Assets and Liabilities Required to be Measured at Fair Value on a Non-Recurring Basis

The following table provides the fair value for each class of assets and liabilities required to be measured at fair value on a non-recurring basis in the Consolidated Statements of Financial Condition by level in the fair value hierarchy.

Non-Recurring Fair Value Measurements

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Collateral-dependent non-accrual loans(1)	$	—	$	—	$	53,608	$	—	$	—	$	41,326
OREO(2)	—		—		530		—		—		3,325
Loans held-for-sale(3)	—		—		45,466		—		—		36,032
Assets held-for-sale(4)	—		—		5,180		—		—		6,824

⁽¹⁾Includes non-accrual loans with charge-offs and non-accrual loans with a specific allowance during the periods presented.

⁽²⁾Includes OREO with fair value adjustments subsequent to initial transfer that occurred during the periods presented.

⁽³⁾Included in other assets in the Consolidated Statements of Financial Condition.

⁽⁴⁾Included in premises, furniture, and equipment in the Consolidated Statements of Financial Condition.

Collateral-Dependent Non-accrual Loans

Certain collateral-dependent non-accrual loans are subject to fair value adjustments to reflect the difference between the carrying value of the loan and the fair value of the underlying collateral. The fair values of collateral-dependent non-accrual loans are primarily determined by current appraised values of the underlying collateral. Based on the age and/or type, appraisals may be adjusted in the range of 0% to 15%. In certain cases, an internal valuation may be used when the underlying collateral is located in areas where comparable sales data is limited or unavailable. Accordingly, collateral-dependent non-accrual loans are classified in level 3 of the fair value hierarchy.

Collateral-dependent non-accrual loans for which the fair value is greater than the recorded investment are not measured at fair value in the Consolidated Statements of Financial Condition and are not included in this disclosure.

OREO

The fair value of OREO is measured using the current appraised value of the properties. In certain circumstances, a current appraisal may not be available or may not represent an accurate measurement of the property's fair value due to outdated market information or other factors. In these cases, the fair value is determined based on the lower of the (i) most recent appraised value, (ii) broker price opinion, (iii) current listing price, or (iv) signed sales contract, all less estimated costs to sell. Given these valuation methods, OREO is classified in level 3 of the fair value hierarchy.

Loans Held-for-Sale

As of June 30, 2020 and December 31, 2019, loans held-for-sale consists of 1-4 family mortgage loans, which were originated with the intent to sell. These loans were recorded in the held-for-sale category at the contract price and, accordingly, are classified in level 3 of the fair value hierarchy.

Assets Held-for-Sale

Assets held-for-sale as of June 30, 2020 and December 31, 2019 consists of former branches that are no longer in operation and parcels of land previously purchased for expansion. These properties are being actively marketed and were transferred into the held-for-sale category at their fair value as determined by current appraisals. Based on these valuation methods, they are classified in level 3 of the fair value hierarchy.

Financial Instruments Not Required to be Measured at Fair Value

For certain financial instruments that are not required to be measured at fair value in the Consolidated Statements of Financial Condition, the Company must disclose the estimated fair values and the level within the fair value hierarchy as shown in the following table.

Fair Value Measurements of Other Financial Instruments

(Dollar amounts in thousands)

		As of
		June 30, 2020				December 31, 2019
	Fair Value Hierarchy Level	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Cash and due from banks	1	$	304,445	$	304,445	$	214,894	$	214,894
Interest-bearing deposits in other banks	2	637,856		637,856		84,327		84,327
Securities held-to-maturity	2	19,628		19,676		21,997		21,234
FHLB and FRB stock	2	148,512		148,512		115,409		115,409
Loans	3	14,693,606		14,739,129		12,733,200		12,535,848
Investment in BOLI	3	299,649		299,649		296,351		296,351
Accrued interest receivable	3	63,162		63,162		59,716		59,716
Liabilities
Deposits	2	$	15,657,656	$	15,667,051	$	13,251,278	$	13,247,871
Borrowed funds	2	2,305,195		2,305,195		1,658,758		1,658,758
Senior and subordinated debt	2	234,358		266,003		233,948		277,203
Accrued interest payable	2	7,633		7,633		10,502		10,502

Management uses various methodologies and assumptions to determine the estimated fair values of the financial instruments in the table above. The fair value estimates are made at a discrete point in time based on relevant market information and consider management's judgments regarding future expected economic conditions, loss experience, and specific risk characteristics of the financial instruments. Loans include the FDIC indemnification asset and net loans, which consists of loans held-for-investment, acquired loans, and the allowance for loan losses. As of both June 30, 2020 and December 31, 2019, the Company estimated the fair value of lending commitments outstanding to be immaterial.

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation – The accompanying unaudited condensed consolidated interim financial statements ("consolidated financial statements") of First Midwest Bancorp, Inc. (the "Company"), a Delaware corporation, were prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q and reflect all adjustments that management deems necessary for the fair presentation of the financial position and results of operations for the periods presented. The results of operations for the quarter and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.The accounting and reporting policies of the Company and its subsidiaries conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. The accompanying consolidated financial statements do not include certain information and note disclosures required by GAAP for complete annual financial statements. Therefore, these financial statements should be read in conjunction with the Company's 2019 Annual Report on Form 10-K ("2019 10-K"). The Company uses the accrual basis of accounting for financial reporting purposes.

Reclassification

Certain reclassifications were made to prior year amounts to conform to the current year presentation.

Use of Estimates

Use of Estimates – The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates and assumptions are based on the best available information, actual results could differ from those estimates.

Principles of Consolidation

Principles of Consolidation – The accompanying consolidated financial statements include the financial position and results of operations of the Company and its subsidiaries after elimination of all significant intercompany accounts and transactions. Assets held in a fiduciary or agency capacity are not assets of the Company or its subsidiaries and are not included in the consolidated financial statements.

Business Combinations

Business Combinations – Business combinations are accounted for under the acquisition method of accounting. Assets acquired and liabilities assumed are recorded at their estimated fair values as of the date of acquisition, with any excess of the purchase price of the acquisition over the fair value of the identifiable net tangible and intangible assets acquired recorded as goodwill. Alternatively, a gain is recorded if the fair value of assets purchased exceeds the fair value of liabilities assumed and consideration paid. The results of operations of the acquired business are included in the Condensed Consolidated Statements of Income from the effective date of the acquisition.

Allowance for Securities Held-to-Maturity

Allowance for Securities Held-to-Maturity – The Company maintains an allowance for securities held-to-maturity for the risk of loss inherent in these financial assets, which reflects the difference between the carrying value and the discounted expected future cash flows of these assets and is included in securities held-to-maturity, at amortized cost, net in the Consolidated Statements of Financial Condition.

Loans

Loans – Loans held-for-investment are loans that the Company intends to hold until they are paid in full and are carried at the principal amount outstanding, including certain net deferred loan origination fees. Loan origination fees, commitment fees, and certain direct loan origination costs are deferred, and the net amount is amortized as a yield adjustment over the contractual life of the related loans or commitments and included in interest income. Fees related to letters of credit are amortized into fee income over the contractual life of the commitment. Other credit-related fees are recognized as fee income when earned. The Company's net investment in direct financing leases is included in loans and consists of future minimum lease payments and estimated residual values, net of unearned income. Interest income on loans is accrued based on principal amounts outstanding. Loans held-for-sale are carried at the lower of aggregate cost or fair value and included in other assets in the Consolidated Statements of Financial Condition.

Acquired and Covered Loans

Acquired Loans – Acquired loans consist of all loans that were acquired in business combinations, including loans which are covered by Federal Deposit Insurance Corporation ("FDIC") Agreements. Acquired loans are included within loans held-for-investment.

Acquired loans are separated into (i) non-purchased credit deteriorated ("non-PCD") loans and (ii) purchased credit deteriorated ("PCD") loans. Non-PCD loans include loans that did not have evidence of more-than-insignificant credit deterioration since origination at the acquisition date. PCD loans include loans that had evidence of more-than-insignificant credit deterioration

since origination. Evidence of credit deterioration was evaluated using various indicators, such as past due and non-accrual status. Leases and revolving loans do not qualify to be accounted for as PCD loans and are accounted for as non-PCD loans.

The acquisition adjustment related to non-PCD loans is amortized into interest income over the contractual life of the related loans. If an acquired non-PCD loan is renewed subsequent to the acquisition date, any remaining acquisition adjustment is accreted into interest income and the loan is considered a new loan that is no longer classified as an acquired loan.

PCD loans are generally accounted for based on estimates of expected future cash flows. The Company uses a discounted cash flow analysis involving significant unobservable inputs and assumptions to measure the fair value of PCD loans. The significant assumptions utilized in the cash flow analysis include the probability of default ("PD"), loss given default ("LGD"), and discount rate. PCD loans are recorded at fair value, excluding credit-related adjustments, for which an allowance for loan losses is established at the acquisition date through purchase accounting adjustments. Expected future cash flows in excess of the fair value of loans at the purchase date ("accretable yield") are recorded as interest income over the life of the loans if the timing and amount of the expected future cash flows can be reasonably estimated. Subsequent to the acquisition date, the allowance for loan losses on PCD loans is estimated as are the allowances for all other loans in the portfolio.

Prior to the adoption of the current expected credit losses ("CECL") accounting guidance on January 1, 2020, acquired loans were separated into (i) non-purchased credit impaired ("non-PCI") loans and (ii) purchased credit impaired ("PCI") loans. The significant accounting policies related to non-PCI and PCI acquired loans are presented in Note 1, "Summary of Significant Accounting Policies" to the Consolidated Financial Statements in the Company's 2019 10-K.

90-Days Past Due Loans

90-Days Past Due Loans – The Company's accrual of interest on loans is generally discontinued at the time the loan is 90 days past due unless the credit is sufficiently collateralized and in the process of renewal or collection.

Non-accrual Loans

Non-accrual Loans – Generally, corporate loans are placed on non-accrual status (i) when either principal or interest payments become 90 days or more past due unless the credit is sufficiently collateralized and in the process of renewal or collection, or (ii) when an individual analysis of a borrower's creditworthiness warrants a downgrade to non-accrual regardless of past due status. When a loan is placed on non-accrual status, unpaid interest credited to income in the current year is reversed, and unpaid interest accrued in prior years is charged against the allowance for loan losses. After the loan is placed on non-accrual status, all debt service payments are applied to the principal on the loan. Future interest income may only be recorded on a cash basis after recovery of principal is reasonably assured. Non-accrual loans are returned to accrual status when the financial position of the borrower and other relevant factors indicate that the Company will collect all principal and interest.

Non-accrual loans with balances under a specified threshold are not individually evaluated for impairment. For all other non-accrual loans, impairment is measured by comparing the estimated value of the loan to the recorded book value. The value of collateral-dependent loans is based on the fair value of the underlying collateral, less costs to sell. The value of other loans is measured using the present value of expected future cash flows discounted at the loan's effective interest rate.

Commercial loans and loans secured by real estate are charged-off when deemed uncollectible. A loss is recorded if the net realizable value of the underlying collateral is less than the outstanding principal and interest. Consumer loans that are not secured by real estate are subject to mandatory charge-off at a specified delinquency date and are usually not classified as non-accrual prior to being charged-off. Closed-end consumer loans, which include installment, automobile, and single payment loans, are usually charged-off no later than the end of the month in which the loan becomes 120 days past due.

Troubled Debt Restructurings (“TDRs”)

Troubled Debt Restructurings ("TDRs") – A restructuring is considered a TDR when (i) the borrower is experiencing financial difficulties, and (ii) the creditor grants a concession, such as forgiveness of principal, reduction of the interest rate, changes in payments, or extension of the maturity date. Loans are not classified as TDRs when the modification is short-term or results in an insignificant delay in payments. The Company's TDRs are determined on a case-by-case basis.

The Company does not accrue interest on a TDR unless it believes collection of all principal and interest under the modified terms is reasonably assured. For a TDR to begin accruing interest, the borrower must demonstrate some level of past performance and the future capacity to perform under the modified terms. Generally, six months of consecutive payment performance under the restructured terms is required before a TDR is returned to accrual status. However, the period could vary depending on the individual facts and circumstances of the loan. An evaluation of the borrower's current creditworthiness is used to assess the borrower's capacity to repay the loan under the modified terms. This evaluation includes an estimate of expected future cash flows, evidence of strong financial position, and estimates of the value of collateral, if applicable. For TDRs to be removed from TDR status in the calendar year after the restructuring, the loans must (i) have an interest rate and terms that reflect market conditions at the time of restructuring, and (ii) be in compliance with the modified terms. If the loan was restructured at below market rates and terms, it continues to be separately reported as restructured until it is paid in full or charged-off.

Allowance for Credit/Loan Losses and Reserve for Unfunded Commitments

Allowance for Credit Losses – The allowance for credit losses is comprised of the allowance for loan losses and the allowance for unfunded commitments and is maintained by management at a level believed adequate to absorb current expected credit losses in the existing loan portfolio. Determination of the allowance for credit losses is subjective since it requires significant estimates and management judgment, including the amounts and timing of expected future cash flows, actual loss experience, consideration of current national, regional, and local economic trends and conditions, reasonable and supportable forecasts about the future, changes in interest rates and property values, various internal and external qualitative factors, and other factors.

Loans deemed to be uncollectible are charged-off against the allowance for loan losses, while recoveries of amounts previously charged-off are credited to the allowance for loan losses. Additions to the allowance for loan losses are charged to expense through the provision for loan losses. The amount of provision depends on a number of factors, including net charge-off levels, loan growth, changes in the composition of the loan portfolio, and the Company's assessment of the allowance for loan losses based on the methodology discussed below.

Allowance for Loan Losses – The allowance for loan losses consists of (i) specific allowance for individual loans where the recorded investment exceeds the value, (ii) an allowance based on historical credit loss experience with consideration of reasonable and supportable forecasts of economic conditions for each loan category, and (iii) an allowance based on other internal and external qualitative factors.

The allowance for individual loans is based on a periodic analysis of non-accrual loans individually exceeding a specific dollar amount. If the estimated value of a non-accrual loan is less than its recorded book value, the Company either (i) provides an allowance in the amount of the excess of the book value over the estimated value of the related loan or, (ii) if the loss is confirmed, charges off the loss.

The allowance by loan category is based on a discounted cash flows analysis as future cash flows are discounted at an effective rate of return. In addition, estimates of losses on future cash flows is forecasted by applying probability of default and loss given default factors as well as prepayment and curtailment assumptions to cash flows that are adjusted to a present value. This discounted cash flow analysis is updated quarterly, primarily using actual loss experience adjusted for current reasonable and supportable forecasts of economic conditions over a one-year forecast period. After the one-year forecast period, a one-year reversion period adjusts loss experience to the historical average on a straight-line basis. These forecasts consider multiple scenarios of key assumptions including national unemployment rates, housing price indices, and gross domestic product.

This general allowance component is then adjusted based on management's consideration of many internal and external qualitative factors, including:

•Changes in the composition of the loan portfolio, trends in the volume of loans, and trends in delinquent and non-accrual loans that could indicate that historical trends do not reflect current conditions.

•Changes in credit policies and procedures, such as underwriting standards and collection, charge-off, and recovery practices.

•Changes in the experience, ability, and depth of credit management and other relevant staff.

•Changes in the quality of the Company's loan review system and Board of Directors oversight.

•The effect of any concentration of credit and changes in the level of concentrations, such as loan type or risk rating.

•Changes in the value of the underlying collateral for collateral-dependent loans.

•Changes in the national, regional, and local economy that affect the collectability of various segments of the portfolio.

•The effect of other external factors, such as competition and legal and regulatory requirements, on the Company's loan portfolio.

The allowance for loan losses also includes an allowance on acquired non-PCD and PCD loans. An allowance for loan losses is recorded on acquired PCD loans at the acquisition date through purchase accounting adjustments. Subsequent to the acquisition date, the allowance for loan losses on PCD loans is estimated as are the allowances for all other loans in the portfolio. No allowance for loan losses is recorded on acquired non-PCD loans at the acquisition date through purchase accounting. Instead, an allowance is established on acquired non-PCD loans at the acquisition date in-line with all other loans in the portfolio as if the loans were originated at the acquisition date. On a periodic basis, the adequacy of this allowance is determined using either a PD/LGD methodology or a specific review methodology.

Allowance for Unfunded Commitments – The Company also maintains an allowance for unfunded commitments, including letters of credit, for the risk of loss inherent in these arrangements. The allowance for unfunded commitments is estimated using the historical credit loss experience with consideration of reasonable and supportable forecasts of economic conditions for each loan category. The allowance for unfunded commitments is included in other liabilities in the Consolidated Statements of Financial Condition.

The establishment of the allowance for credit losses involves a high degree of judgment and estimation given the difficulty of assessing the factors impacting loan repayment and estimating the timing and amount of losses. While management utilizes its best judgment and information available, the adequacy of the allowance for credit losses depends on a variety of factors beyond the Company's control, including the performance of its loan portfolio, current national, regional, and local economic trends, reasonable and supportable forecasts about the future, changes in interest rates and property values, the amounts and timing of expected future cash flows on non-accrual loans, estimated losses on pools of homogenous loans, the interpretation of loan risk classifications by regulatory authorities, various internal and external qualitative factors, and other factors.

Lease Obligations

Lease Obligations – The Company leases certain premises under non-cancelable operating leases in the normal course of business operations. These lease obligations result in the recognition of right-of-use assets and associated lease liabilities. The amount of right-of-use assets and associated lease liabilities recorded is based on the present value of future minimum lease payments. Right-of-use assets are amortized on a straight-line basis over the estimated useful lives of the related premises, and interest associated with the net present value of future minimum lease payments is included in net occupancy and equipment expense in the consolidated financial statements.

Derivative Financial Instruments

Derivative Financial Instruments – To provide derivative products to customers and in the ordinary course of business, the Company enters into derivative transactions as part of its overall interest rate risk management strategy to minimize significant unplanned fluctuations in earnings and expected future cash flows caused by interest rate volatility. All derivative instruments are recorded at fair value as either other assets or other liabilities in the Consolidated Statements of Financial Condition. Subsequent changes in a derivative's fair value are recognized in earnings unless specific hedge accounting criteria are met.

On the date the Company enters into a derivative contract, the derivative is designated as a fair value hedge, a cash flow hedge, or a non-hedge derivative instrument. Fair value hedges are designed to mitigate exposure to changes in the fair value of an asset or liability attributable to a particular risk, such as interest rate risk. Cash flow hedges are designed to mitigate exposure to variability in expected future cash flows to be received or paid related to an asset, liability, or other type of forecasted transaction. The Company formally documents all relationships between hedging instruments and hedged items, including its risk management objective and strategy at inception.

At the hedge's inception, a formal assessment is performed to determine the effectiveness of the derivative in offsetting changes in the fair values or expected future cash flows of the hedged items in the current period and prospectively. If a derivative instrument designated as a hedge is terminated or ceases to be highly effective, hedge accounting is discontinued prospectively, and the gain or loss is amortized into earnings. For fair value hedges, the gain or loss is amortized over the remaining life of the hedged asset or liability. For cash flow hedges, the gain or loss is amortized over the same period that the forecasted hedged transactions impact earnings. If the hedged item is disposed of, any fair value adjustments are included in the gain or loss from the disposition of the hedged item. If the forecasted transaction is no longer probable, the gain or loss is included in earnings immediately.

For fair value hedges, changes in the fair value of the derivative instruments, as well as changes in the fair value of the hedged item, are recognized in earnings in the same income statement line item as the earnings effect of the hedged item. For cash flow hedges, the effective portion of the change in fair value of the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and is reclassified to earnings when the hedged transaction is reflected in earnings.

Recent Accounting Pronouncements

Adopted Accounting Pronouncements

Measurement of Credit Losses on Financial Instruments: In June of 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2016-13 that requires entities to present financial assets measured at amortized cost at the net amount expected to be collected, considering an entity's current estimate of all expected credit losses. In addition, credit losses relating to available-for-sale debt securities are required to be recorded through an allowance for credit losses, with changes in credit loss estimates recognized through current earnings. This guidance is effective for annual and interim periods beginning after December 15, 2019.

The Company adopted this guidance on January 1, 2020, which resulted in the recognition of $76.0 million of allowance for credit losses which includes $26.0 million attributable to loans, $5.6 million attributable to unfunded commitments, $35.7 million attributable to PCD loans, $8.5 million attributable to non-PCD acquired loans, and $220,000 attributable to securities held-to-maturity. The portion of the allowance for credit losses attributable to PCD loans did not have an impact on equity as the credit-related portion of acquisition adjustments on loans previously classified as PCI transitioned to PCD accounting treatment upon adoption. The amount of allowance for credit losses recognized upon adoption was based on the composition of the loan portfolio, as well as the economic conditions and forecasts as of the adoption date. The Company adopted this guidance using the modified retrospective approach which resulted in the recognition of a $26.8 million after-tax

reduction to retained earnings as a cumulative-effect adjustment on January 1, 2020. Prior period amounts continue to be reported in accordance with previously applicable standards and the accounting policies described in the Company's 2019 10-K.

The Company has made the following elections upon adoption of ASU 2016-13:

•When determining the allowance and net carrying value amount for financial assets in which the repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty, the Company will use the fair value of collateral at the reporting date.

•The Company writes off uncollectible accrued interest in a timely manner and, therefore, will not measure an allowance for credit losses for accrued interest receivable.

•The Company uses a discounted cash flow approach for the majority of its applicable instruments. The change in the present value from one reporting period to the next may result from the passage of time, in addition to changes in estimates of the timing of the cash flows. The Company will report the entire change in the present value as provision for loan losses (or reversal of provision for loan losses) versus reporting the change related to the passage of time as interest income.

For additional discussion of the allowance for credit losses, see Note 7 "Past Due Loans, Allowance for Credit Losses, Non-Accrual Loans, and TDRs."

Accounting for Goodwill Impairment: In January of 2017, the FASB issued ASU 2017-04 that simplifies the accounting for goodwill impairment for all entities. The new guidance eliminates the requirement to calculate the implied fair value of goodwill using the second step of the quantitative two-step goodwill impairment model prescribed under current accounting guidance. Under the new guidance, if a reporting unit's carrying amount exceeds its fair value, an entity will record an impairment charge based on that difference. This guidance is effective for annual and interim goodwill impairment testing dates beginning after December 15, 2019. The adoption of this guidance on January 1, 2020 did not materially impact the Company's financial condition, results of operations, or liquidity.

Changes to the Disclosure Requirements for Fair Value Measurement: In August of 2018, the FASB issued ASU 2018-13 that eliminates, modifies, and adds to certain fair value measurement disclosure requirements associated with the three-tiered fair value hierarchy. This guidance is effective for annual and interim periods beginning after December 15, 2019. The adoption of this guidance on January 1, 2020 did not materially impact the Company's financial condition, results of operations, or liquidity.

Loan Modifications Due to COVID-19: In March of 2020, the CARES Act was enacted by the U.S. government in response to the economic disruption caused by the COVID-19 pandemic (the "pandemic"). The Company's banking regulators issued a statement titled the "Interagency Statement on Loan Modifications by Financial Institutions Working with Customers Affected by the Coronavirus" that encourages financial institutions to work prudently with borrowers who are or may be unable to meet their contractual payment obligations due to the effects of the pandemic. Additionally, the CARES Act provides that a qualified loan modification is exempt by law from classification as a TDR as defined by GAAP, from the period beginning March 1, 2020 until the earlier of December 31, 2020 or the date that is 60 days after the date on which the national emergency concerning the pandemic declared by the President of the United States terminates. Accordingly, the Company is offering short-term modifications made in response to the pandemic to borrowers who are current and otherwise not past due. These include short-term modifications in the form of payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. The total balance of loans with eligible modifications as of June 30, 2020 was $1.9 billion.

Regulatory Capital Delay of CECL Impact: In February of 2019, the federal bank regulatory agencies issued a final rule, the 2019 CECL Rule, that revised certain capital regulations to account for changes to credit loss accounting under U.S. GAAP. The 2019 CECL Rule included a transition option that allows banking organizations to phase in, over a three-year period, the day-one adverse effects of CECL on their regulatory capital ratios (three-year transition option). In March of 2020, the federal bank regulatory agencies issued an interim final rule that maintains the three year transition option of the 2019 CECL Rule and also provides banking organizations that were required under GAAP (as of January 2020) to implement CECL before the end of 2020 the option to delay for two years an estimate of the effect of CECL on regulatory capital, relative to the incurred loss methodology's effect on regulatory capital, followed by a three-year transition period (five-year transition option). The Company elected to adopt the five-year transition option. This election of the transition option is applicable only to regulatory capital computations under federal banking regulations and does not otherwise impact the financial statements prepared in accordance with GAAP.

Accounting Pronouncements Pending Adoption

Changes to the Disclosure Requirements for Defined Benefit Plans: In August of 2018, the FASB issued ASU 2018-14 that makes minor changes and clarifications to the disclosure requirements for entities that sponsor defined benefit plans. This guidance is effective for annual and interim periods beginning after December 15, 2020. Early adoption is permitted.

Management does not expect the adoption of this guidance will materially impact the Company's financial condition, results of operations, or liquidity.

Income Taxes: In December of 2019, the FASB issued ASU 2019-12 that removes certain exceptions to the general principles of accounting for income taxes. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. Management does not expect the adoption of this guidance will materially impact the Company's financial condition, results of operations, or liquidity.

Reference Rate Reform: In March of 2020, the FASB issued ASU 2020-04 that provides optional expedients and exceptions for applying GAAP to contracts and other transactions affected by reference rate reform, if certain criteria are met. This guidance is effective as of March 12, 2020 through December 31, 2022. Management is in the process of determining the impact on the Company's financial condition, results of operations, and liquidity.

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Acquisitions (Tables)

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Schedule of Acquisition Activity

The following table presents the assets acquired and liabilities assumed, net of the fair value adjustments, in the Park Bank and Bridgeview transactions as of the acquisition date. The assets acquired and liabilities assumed, both intangible and tangible, were recorded at their estimated fair values as of the acquisition date and have been accounted for under the acquisition method of accounting.

Acquisition Activity

(Dollar amounts in thousands, except share and per share data)

	Park Bank		Bridgeview
	March 9, 2020		May 9, 2019
Assets
Cash and due from banks and interest-bearing deposits in other banks	$	244,781	$	35,097
Equity securities	—		6,966
Securities available-for-sale	136,856		263,090
Securities held-to-maturity	300		13,426
FHLB and FRB stock	—		1,481
Loans	685,451		709,438
OREO	2,001		5,436
Goodwill	62,433		63,231
Other intangible assets	3,068		15,603
Premises, furniture, and equipment	2,550		16,138
Accrued interest receivable and other assets	13,796		35,909
Total assets	$	1,151,236	$	1,165,815
Liabilities
Noninterest-bearing deposits	$	356,050	$	179,267
Interest-bearing deposits	594,026		807,487
Total deposits	950,076		986,754
Borrowed funds	11,532		1,746
Senior and subordinated debt	—		29,360
Accrued interest payable and other liabilities	15,246		12,603
Total liabilities	976,854		1,030,463
Consideration Paid
Common stock (2020 – 4,930,231, shares issued at $14.58 per share, 2019 –   4,728,541, shares issued at $20.77 per share), net of issuance costs	71,883		98,212
Cash paid	102,499		37,140
Total consideration paid	174,382		135,352
	$	1,151,236	$	1,165,815

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Securities (Tables)

6 Months Ended

Jun. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Securities Available-for-Sale

A summary of the Company's securities portfolio by category and maturity is presented in the following tables.

Securities Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized				Fair Value		Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses						Gains		Losses
Securities Available-for-Sale
U.S. treasury securities	$	20,992	$	207	$	—	$	21,199	$	33,939	$	137	$	(1)	$	34,075
U.S. agency securities	640,253		4,166		(1,372)		643,047		249,502		758		(1,836)		248,424
Collateralized mortgage obligations ("CMOs")	1,624,609		49,059		(1,539)		1,672,129		1,547,805		14,893		(5,027)		1,557,671
Other mortgage-backed securities ("MBSs")	695,218		20,159		(237)		715,140		678,804		7,728		(1,848)		684,684
Municipal securities	229,414		10,410		(21)		239,803		228,632		5,898		(99)		234,431
Corporate debt securities	143,639		2,367		(1,462)		144,544		112,797		1,791		(487)		114,101
Total securities available-for-sale	$	3,354,125	$	86,368	$	(4,631)	$	3,435,862	$	2,851,479	$	31,205	$	(9,298)	$	2,873,386
Securities Held-to-Maturity
Municipal securities	$	19,848	$	48	$	—	$	19,896	$	21,997	$	—	$	(763)	$	21,234
Allowance for securities held-to-   maturity(1)	(220)						$	(220)
Total securities held-to-maturity, net	$	19,628	$	48	$	—	$	19,676
Equity Securities							$	43,954							$	42,136

⁽¹⁾The allowance for securities held-to-maturity was established upon adoption of CECL on January 1, 2020.

Securities Held-to-Maturity

A summary of the Company's securities portfolio by category and maturity is presented in the following tables.

Securities Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized				Fair Value		Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses						Gains		Losses
Securities Available-for-Sale
U.S. treasury securities	$	20,992	$	207	$	—	$	21,199	$	33,939	$	137	$	(1)	$	34,075
U.S. agency securities	640,253		4,166		(1,372)		643,047		249,502		758		(1,836)		248,424
Collateralized mortgage obligations ("CMOs")	1,624,609		49,059		(1,539)		1,672,129		1,547,805		14,893		(5,027)		1,557,671
Other mortgage-backed securities ("MBSs")	695,218		20,159		(237)		715,140		678,804		7,728		(1,848)		684,684
Municipal securities	229,414		10,410		(21)		239,803		228,632		5,898		(99)		234,431
Corporate debt securities	143,639		2,367		(1,462)		144,544		112,797		1,791		(487)		114,101
Total securities available-for-sale	$	3,354,125	$	86,368	$	(4,631)	$	3,435,862	$	2,851,479	$	31,205	$	(9,298)	$	2,873,386
Securities Held-to-Maturity
Municipal securities	$	19,848	$	48	$	—	$	19,896	$	21,997	$	—	$	(763)	$	21,234
Allowance for securities held-to-   maturity(1)	(220)						$	(220)
Total securities held-to-maturity, net	$	19,628	$	48	$	—	$	19,676
Equity Securities							$	43,954							$	42,136

⁽¹⁾The allowance for securities held-to-maturity was established upon adoption of CECL on January 1, 2020.

Equity Securities

A summary of the Company's securities portfolio by category and maturity is presented in the following tables.

Securities Portfolio

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized				Fair Value		Amortized Cost		Gross Unrealized				Fair Value
			Gains		Losses						Gains		Losses
Securities Available-for-Sale
U.S. treasury securities	$	20,992	$	207	$	—	$	21,199	$	33,939	$	137	$	(1)	$	34,075
U.S. agency securities	640,253		4,166		(1,372)		643,047		249,502		758		(1,836)		248,424
Collateralized mortgage obligations ("CMOs")	1,624,609		49,059		(1,539)		1,672,129		1,547,805		14,893		(5,027)		1,557,671
Other mortgage-backed securities ("MBSs")	695,218		20,159		(237)		715,140		678,804		7,728		(1,848)		684,684
Municipal securities	229,414		10,410		(21)		239,803		228,632		5,898		(99)		234,431
Corporate debt securities	143,639		2,367		(1,462)		144,544		112,797		1,791		(487)		114,101
Total securities available-for-sale	$	3,354,125	$	86,368	$	(4,631)	$	3,435,862	$	2,851,479	$	31,205	$	(9,298)	$	2,873,386
Securities Held-to-Maturity
Municipal securities	$	19,848	$	48	$	—	$	19,896	$	21,997	$	—	$	(763)	$	21,234
Allowance for securities held-to-   maturity(1)	(220)						$	(220)
Total securities held-to-maturity, net	$	19,628	$	48	$	—	$	19,676
Equity Securities							$	43,954							$	42,136

⁽¹⁾The allowance for securities held-to-maturity was established upon adoption of CECL on January 1, 2020.

Remaining Contractual Maturity of Securities

Remaining Contractual Maturity of Securities

(Dollar amounts in thousands)

	As of June 30, 2020
	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	270,623	$	274,363	$	8,070	$	8,089
After one year to five years	185,159		187,718		5,452		5,465
After five years to ten years	578,516		586,512		3,315		3,323
After ten years	—		—		2,791		2,799
Securities that do not have a single contractual maturity date	2,319,827		2,387,269		—		—
Total	$	3,354,125	$	3,435,862	$	19,628	$	19,676

Securities in an Unrealized Loss Position

The following table presents the aggregate amount of unrealized losses and the aggregate related fair values of securities with unrealized losses as of June 30, 2020 and December 31, 2019.

Securities in an Unrealized Loss Position

(Dollar amounts in thousands)

		Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
As of June 30, 2020
Securities Available-for-Sale
U.S. agency securities	23	$	73,659	$	1,149	$	13,927	$	223	$	87,586	$	1,372
CMOs	41	139,578		1,379		33,967		160		173,545		1,539
MBSs	14	64,778		223		3,805		14		68,583		237
Municipal securities	1	1,745		21		—		—		1,745		21
Corporate debt securities	11	39,949		154		38,199		1,308		78,148		1,462
Total	90	$	319,709	$	2,926	$	89,898	$	1,705	$	409,607	$	4,631
As of December 31, 2019
Securities Available-for-Sale
U.S. treasury securities	5	$	4,966	$	1	$	—	$	—	$	4,966	$	1
U.S. agency securities	52	97,729		1,200		49,387		636		147,116		1,836
CMOs	148	187,470		2,177		412,083		2,850		599,553		5,027
MBSs	59	66,340		996		121,861		852		188,201		1,848
Municipal securities	16	9,384		89		3,104		10		12,488		99
Corporate debt securities	6	9,719		281		21,955		206		31,674		487
Total	286	$	375,608	$	4,744	$	608,390	$	4,554	$	983,998	$	9,298

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Loans (Tables)

6 Months Ended

Jun. 30, 2020

Loans and Leases Receivable Disclosure [Abstract]

Composition Of Loan Portfolio

The following table presents the Company's loans held-for-investment by class.

Loan Portfolio

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Commercial and industrial	$	4,789,556	$	4,481,525
Agricultural	381,124		405,616
Commercial real estate:
Office, retail, and industrial	2,020,318		1,848,718
Multi-family	874,861		856,553
Construction	687,063		593,093
Other commercial real estate	1,475,937		1,383,708
Total commercial real estate	5,058,179		4,682,072
Total corporate loans, excluding Paycheck Protection Program ("PPP") loans	10,228,859		9,569,213
PPP loans	1,179,403		—
Total corporate loans	11,408,262		9,569,213
Home equity	892,867		851,454
1-4 family mortgages	2,175,322		1,927,078
Installment	457,207		492,585
Total consumer loans	3,525,396		3,271,117
Total loans	$	14,933,658	$	12,840,330
Deferred loan fees included in total loans	$	9,691	$	7,972
Overdrawn demand deposits included in total loans	7,676		10,675

Loan Sales and Purchases

The following table presents loan sales and purchases for the quarters and six months ended June 30, 2020 and 2019.

Loan Sales and Purchases

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Corporate loan sales
Proceeds from sales	$	295	$	2,178	$	4,598	$	5,376
Less book value of loans sold	289		2,132		4,477		5,248
Net gains on corporate loan sales(1)	6		46		121		128
1-4 family mortgage loan sales
Proceeds from sales	173,251		95,408		292,410		154,191
Less book value of loans sold	168,656		93,473		285,301		150,928
Net gains on 1-4 family mortgage loan sales(2)	4,595		1,935		7,109		3,263
Total net gains on loan sales	$	4,601	$	1,981	$	7,230	$	3,391
Corporate loan purchases(3)
Commercial and industrial	$	22,894	$	128,891	$	168,716	$	181,610
Office, retail, and industrial	—		1,711		—		1,711
Construction	3,258		1,432		3,897		2,266
Other commercial real estate	10,000		—		10,000		3,986
Total corporate loan purchases	$	36,152	$	132,034	$	182,613	$	189,573
Consumer loan purchases
Home equity	$	—	$	39,159	$	144,967	$	77,411
1-4 family mortgages	179,410		231,533		249,585		304,463
Total consumer loan purchases	$	179,410	$	270,692	$	394,552	$	381,874

⁽¹⁾Net gains on corporate loan sales are included in other service charges, commissions, and fees in the Condensed Consolidated Statements of Income.

⁽²⁾Net gains on 1-4 family mortgage loan sales are included in mortgage banking income in the Condensed Consolidated Statements of Income.

⁽³⁾Consists of the Company's portion of loan participations purchased.

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Acquired Loans (Tables)

6 Months Ended

Jun. 30, 2020

Transfers and Servicing [Abstract]

Schedule of Acquired Loans

The following table presents the carrying amount of acquired loans as of June 30, 2020 and December 31, 2019.

Acquired Loans⁽¹⁾⁽²⁾

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	PCD		Non-PCD		Total		PCI		Non-PCI		Total
Acquired loans	$	243,207	$	1,516,157	$	1,759,364	$	167,183	$	1,216,133	$	1,383,316

⁽¹⁾Included in loans in the Consolidated Statements of Financial Condition.

⁽²⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

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Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS (Tables)

6 Months Ended

Jun. 30, 2020

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Past Due Financing Receivables

The following table presents an aging analysis of the Company's past due loans as of June 30, 2020 and December 31, 2019 with balances presented on an amortized cost basis. The aging is determined without regard to accrual status. The table also presents non-performing loans, consisting of non-accrual loans (the majority of which are past due) and loans 90 days or more past due and still accruing interest, as of each balance sheet date.

Aging Analysis of Past Due Loans and Non-performing Loans by Class⁽¹⁾

(Dollar amounts in thousands)

	Aging Analysis (Accruing and Non-accrual)										Non-performing Loans
	Current		30-89 Days Past Due		90 Days or More Past Due		Total Past Due		Total Loans		Non- accrual		90 Days or More Past Due, Still Accruing Interest
As of June 30, 2020
Commercial and industrial	$	4,750,932	$	20,550	$	18,074	$	38,624	$	4,789,556	$	28,349	$	1,090
Agricultural	373,910		—		7,214		7,214		381,124		8,494		—
Commercial real estate:
Office, retail, and industrial	1,982,798		4,973		32,547		37,520		2,020,318		35,915		596
Multi-family	870,430		1,538		2,893		4,431		874,861		3,121		—
Construction	658,892		801		27,370		28,171		687,063		27,282		88
Other commercial real estate	1,458,874		5,145		11,918		17,063		1,475,937		18,372		25
Total commercial real estate	4,970,994		12,457		74,728		87,185		5,058,179		84,690		709
Total corporate loans, excluding PPP loans	10,095,836		33,007		100,016		133,023		10,228,859		121,533		1,799
PPP loans	1,179,403		—		—		—		1,179,403		—		—
Total corporate loans	11,275,239		33,007		100,016		133,023		11,408,262		121,533		1,799
Home equity	885,678		2,641		4,548		7,189		892,867		9,129		187
1-4 family mortgages	2,164,611		4,928		5,783		10,711		2,175,322		8,498		—
Installment	454,996		956		1,255		2,211		457,207		—		1,255
Total consumer loans	3,505,285		8,525		11,586		20,111		3,525,396		17,627		1,442
Total loans	$	14,780,524	$	41,532	$	111,602	$	153,134	$	14,933,658	$	139,160	$	3,241
As of December 31, 2019
Commercial and industrial	$	4,455,381	$	11,468	$	14,676	$	26,144	$	4,481,525	$	29,995	$	2,207
Agricultural	398,676		850		6,090		6,940		405,616		5,954		358
Commercial real estate:
Office, retail, and industrial	1,830,321		2,943		15,454		18,397		1,848,718		25,857		546
Multi-family	853,762		211		2,580		2,791		856,553		2,697		—
Construction	588,065		4,876		152		5,028		593,093		152		—
Other commercial real estate	1,377,678		3,233		2,797		6,030		1,383,708		4,729		529
Total commercial real estate	4,649,826		11,263		20,983		32,246		4,682,072		33,435		1,075
Total corporate loans	9,503,883		23,581		41,749		65,330		9,569,213		69,384		3,640
Home equity	841,908		4,992		4,554		9,546		851,454		8,443		146
1-4 family mortgages	1,917,648		5,452		3,978		9,430		1,927,078		4,442		1,203
Installment	491,406		1,167		12		1,179		492,585		—		12
Total consumer loans	3,250,962		11,611		8,544		20,155		3,271,117		12,885		1,361
Total loans	$	12,754,845	$	35,192	$	50,293	$	85,485	$	12,840,330	$	82,269	$	5,001

⁽¹⁾ Prior to the adoption of CECL on January 1, 2020, purchased credit impaired ("PCI") loans with an accretable yield were considered current and were not included in past due loan totals. In addition, PCI loans with an accretable yield were excluded from non-accrual loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals. In addition, an allowance for credit losses is established as of the acquisition date or upon the adoption of CECL for loans previously classified as PCI, as PCD loans are no longer recorded net of a credit-related acquisition adjustment.

Allowance for Credit Losses on Financing Receivables

A rollforward of the allowance for credit losses by portfolio segment for the quarters and six months ended June 30, 2020 and 2019 is presented in the table below. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)

	Commercial, Industrial, and Agricultural		Office, Retail, and Industrial		Multi- family		Construction		Other Commercial Real Estate		Consumer		Allowance for Unfunded Commitments		Total Allowance for Credit Losses
Quarter Ended June 30, 2020
Beginning balance	$	113,733	$	25,856	$	3,689	$	11,297	$	18,554	$	46,819	$	6,753	$	226,701
Allowance established for acquired PCD loans	378		—		—		—		—		—		872		1,250
Charge-offs	(5,673)		(3,092)		(9)		(798)		(31)		(4,631)		—		(14,234)
Recoveries	820		6		—		—		12		473		—		1,311
Net charge-offs	(4,853)		(3,086)		(9)		(798)		(19)		(4,158)		—		(12,923)
Provision for loan losses and other	14,719		1,671		1,631		1,023		3,327		10,278		—		32,649
Ending balance	$	123,977	$	24,441	$	5,311	$	11,522	$	21,862	$	52,939	$	7,625	$	247,677
Quarter Ended June 30, 2019
Beginning balance	$	64,685	$	7,679	$	2,216	$	2,131	$	4,930	$	21,938	$	1,200	$	104,779
Charge-offs	(6,516)		(1,605)		—		—		(329)		(2,974)		—		(11,424)
Recoveries	1,258		151		—		10		45		619		—		2,083
Net charge-offs	(5,258)		(1,454)		—		10		(284)		(2,355)		—		(9,341)
Provision for loan losses and other	6,937		1,270		(57)		(279)		351		3,269		—		11,491
Ending balance	$	66,364	$	7,495	$	2,159	$	1,862	$	4,997	$	22,852	$	1,200	$	106,929
Six Months Ended June 30, 2020
Beginning balance	$	62,830	$	7,580	$	2,950	$	1,697	$	6,408	$	26,557	$	1,200	$	109,222
Adjustment to apply   recent accounting   pronouncements(1)	20,159		11,686		397		10,300		11,427		16,235		5,553		75,757
Allowance established for acquired PCD loans	12,640		2,003		—		—		—		39		872		15,554
Charge-offs	(12,739)		(3,430)		(19)		(2,606)		(339)		(9,031)		—		(28,164)
Recoveries	1,979		15		5		—		156		972		—		3,127
Net charge-offs	(10,760)		(3,415)		(14)		(2,606)		(183)		(8,059)		—		(25,037)
Provision for loan   losses and other	39,108		6,587		1,978		2,131		4,210		18,167		—		72,181
Ending balance	$	123,977	$	24,441	$	5,311	$	11,522	$	21,862	$	52,939	$	7,625	$	247,677
Six Months Ended June 30, 2019
Beginning balance	$	63,276	$	7,900	$	2,464	$	2,173	$	4,934	$	21,472	$	1,200	$	103,419
Charge-offs	(12,967)		(2,233)		(340)		(6)		(539)		(6,116)		—		(22,201)
Recoveries	2,559		161		1		16		66		973		—		3,776
Net charge-offs	(10,408)		(2,072)		(339)		10		(473)		(5,143)		—		(18,425)
Provision for loan   losses and other	13,496		1,667		34		(321)		536		6,523		—		21,935
Ending balance	$	66,364	$	7,495	$	2,159	$	1,862	$	4,997	$	22,852	$	1,200	$	106,929

⁽¹⁾ As a result of accounting guidance adopted in the first quarter of 2020, the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

Schedule of Loans and The Related Allowance For Credit Losses

The table below provides a breakdown of loans and the related allowance for credit losses by portfolio segment as of June 30, 2020 and December 31, 2019.

Loans and Related Allowance for Credit Losses by Portfolio Segment

(Dollar amounts in thousands)

	Loans								Allowance for Credit Losses
	Individually Evaluated		Collectively Evaluated		PCD/PCI(1)		Total		Individually Evaluated		Collectively Evaluated		PCD/PCI(1)		Total
As of June 30, 2020
Commercial, industrial,  agricultural	$	25,190	$	5,049,876	$	95,614	$	5,170,680	$	4,805	$	102,735	$	16,437	$	123,977
Commercial real estate:
Office, retail, and industrial	25,165		1,956,597		38,556		2,020,318		885		14,964		8,592		24,441
Multi-family	1,785		871,545		1,531		874,861		—		5,126		185		5,311
Construction	18,611		646,355		22,097		687,063		—		4,624		6,898		11,522
Other commercial real estate	3,806		1,410,080		62,051		1,475,937		44		10,332		11,486		21,862
Total commercial real estate	49,367		4,884,577		124,235		5,058,179		929		35,046		27,161		63,136
Total corporate loans, excluding PPP loans	74,557		9,934,453		219,849		10,228,859		5,734		137,781		43,598		187,113
PPP loans	—		1,179,403		—		1,179,403		—		—		—		—
Total corporate loans	74,557		11,113,856		219,849		11,408,262		5,734		137,781		43,598		187,113
Consumer	23		3,502,015		23,358		3,525,396		—		52,103		836		52,939
Allowance for unfunded commitments	—		—		—		—		—		7,625		—		7,625
Total loans	$	74,580	$	14,615,871	$	243,207	$	14,933,658	$	5,734	$	197,509	$	44,434	$	247,677
As of December 31, 2019
Commercial, industrial, and   agricultural	$	34,142	$	4,807,114	$	45,885	$	4,887,141	$	3,414	$	59,108	$	308	$	62,830
Commercial real estate:
Office, retail, and industrial	24,820		1,795,557		28,341		1,848,718		578		6,899		103		7,580
Multi-family	1,995		851,857		2,701		856,553		—		2,854		96		2,950
Construction	123		581,747		11,223		593,093		—		1,681		16		1,697
Other commercial real estate	3,241		1,323,635		56,832		1,383,708		—		4,867		1,541		6,408
Total commercial real estate	30,179		4,552,796		99,097		4,682,072		578		16,301		1,756		18,635
Total corporate loans	64,321		9,359,910		144,982		9,569,213		3,992		75,409		2,064		81,465
Consumer	—		3,248,916		22,201		3,271,117		—		25,424		1,133		26,557
Allowance for unfunded commitments	—		—		—		—		—		1,200		—		1,200
Total loans	$	64,321	$	12,608,826	$	167,183	$	12,840,330	$	3,992	$	102,033	$	3,197	$	109,222

⁽¹⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

Impaired Financing Receivables

The following table presents collateral-dependent loans, including PCD loans, without regard to accrual status by primary collateral type and non-accrual loans with no related allowance as of June 30, 2020. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Collateral-dependent Loans and Non-accrual Loans With No Related Allowance by Class

(Dollar amounts in thousands)

	Type of Collateral						Non-accrual Loans With No Related Allowance
	Real Estate		Blanket Lien		Equipment
Commercial and industrial	$	6,870	$	45,235	$	3,169	$	6,338
Agricultural	3,417		4,719		—		4,485
Commercial real estate:
Office, retail, and industrial	44,538		—		—		17,293
Multi-family	2,606		—		—		1,785
Construction	28,779		—		—		19,043
Other commercial real estate	33,845		—		—		11,789
Total commercial real estate	109,768		—		—		49,910
Total corporate loans	120,055		49,954		3,169		60,733
Home equity	244		—		—		123
1-4 family mortgages	2,665		—		—		527
Installment	—		—		—		—
Total consumer loans	2,909		—		—		650
Total loans	$	122,964	$	49,954	$	3,169	$	61,383

Loans Individually Evaluated

The following table presents loans individually evaluated by class of loan as of June 30, 2020 and December 31, 2019. PCD and PCI loans are excluded from this disclosure.

Loans Individually Evaluated by Class

(Dollar amounts in thousands)

	As of June 30, 2020								As of December 31, 2019
	Recorded Investment In								Recorded Investment In
	Loans with No Specific Allowance		Loans with a Specific Allowance		Unpaid Principal Balance		Specific Allowance		Loans with No Specific Allowance		Loans with a Specific Allowance		Unpaid Principal Balance		Specific Allowance
Commercial and industrial	$	4,884	$	12,170	$	37,153	$	3,018	$	12,885	$	15,516	$	52,559	$	2,456
Agricultural	4,485		3,651		13,032		1,787		1,889		3,852		9,293		958
Commercial real estate:
Office, retail, and industrial	15,839		9,326		28,730		885		14,111		10,709		37,007		578
Multi-family	1,785		—		1,785		—		1,995		—		1,995		—
Construction	18,611		—		18,611		—		123		—		123		—
Other commercial real estate	3,357		449		4,103		44		3,241		—		3,495		—
Total commercial real estate	39,592		9,775		53,229		929		19,470		10,709		42,620		578
Total corporate loans	48,961		25,596		103,414		5,734		34,244		30,077		104,472		3,992
Consumer	23		—		23		—		—		—		—		—
Total non-accrual loans individually evaluated	$	48,984	$	25,596	$	103,437	$	5,734	$	34,244	$	30,077	$	104,472	$	3,992

Financing Receivable Credit Quality Indicators

The following tables present credit quality indicators for corporate and consumer loans on an amortized cost basis as of June 30, 2020 and net loan charge-offs for the six months ended June 30, 2020. PPP loans are excluded from this table as there is no allowance for credit losses associated with these loans due to guarantees.

Corporate Loan Portfolio by Origination Year

(Dollar amounts in thousands)

	2020(1)		2019		2018		2017		2016		Prior		Revolving Loans		Total
Commercial, industrial, agricultural:
Pass	$	461,644	$	887,292	$	924,776	$	519,875	$	238,751	$	469,442	$	1,364,316	$	4,866,096
Special Mention(2)	3,508		6,520		31,435		4,676		8,527		17,568		80,597		152,831
Substandard(3)	384		4,376		26,729		17,862		16,583		15,804		33,172		114,910
Non-accrual(4)	—		1,771		2,381		8,505		4,806		6,682		12,698		36,843
Total commercial, industrial, agricultural	$	465,536	$	899,959	$	985,321	$	550,918	$	268,667	$	509,496	$	1,490,783	$	5,170,680
Commercial, industrial, agricultural, net loan charge-offs	$	—	$	250	$	946	$	1,058	$	617	$	1,853	$	6,036	$	10,760
Office, retail, and industrial:
Pass	$	95,291	$	266,479	$	225,938	$	348,121	$	302,430	$	677,880	$	5,491	$	1,921,630
Special Mention(2)	1,173		655		3,280		5,091		15,439		12,914		—		38,552
Substandard(3)	—		—		—		337		1,514		22,370		—		24,221
Non-accrual(4)	—		—		132		—		10,238		25,545		—		35,915
Total office, retail, and industrial	$	96,464	$	267,134	$	229,350	$	353,549	$	329,621	$	738,709	$	5,491	$	2,020,318
Office, retail, and industrial net loan charge-offs	$	—	$	333	$	156	$	—	$	1,628	$	1,298	$	—	$	3,415
Multi-family:
Pass	$	125,328	$	174,802	$	84,791	$	101,492	$	101,846	$	239,713	$	36,111	$	864,083
Special Mention(2)	—		—		—		—		358		1,416		—		1,774
Substandard(3)	—		—		387		81		—		5,415		—		5,883
Non-accrual(4)	—		—		—		1,785		237		1,099		—		3,121
Total multi-family	$	125,328	$	174,802	$	85,178	$	103,358	$	102,441	$	247,643	$	36,111	$	874,861
Multi-family net loan charge-offs	$	—	$	3	$	—	$	1	$	—	$	10	$	—	$	14
Construction:
Pass	$	33,890	$	151,849	$	171,480	$	101,781	$	71,001	$	70,950	$	33,016	$	633,967
Special Mention(2)	—		—		45		3,032		14,221		1,228		—		18,526
Substandard(3)	—		—		—		—		—		7,288		—		7,288
Non-accrual(4)	—		—		—		—		—		25,591		1,691		27,282
Total construction	$	33,890	$	151,849	$	171,525	$	104,813	$	85,222	$	105,057	$	34,707	$	687,063
Construction net loan charge-offs	$	—	$	118	$	—	$	798	$	—	$	1,690	$	—	$	2,606
Other commercial real estate:
Pass	$	61,056	$	195,768	$	269,526	$	226,064	$	125,249	$	466,436	$	27,553	$	1,371,652
Special Mention(2)	—		3,532		7,589		6,887		11,219		15,463		—		44,690
Substandard(3)	—		—		—		1,400		4,224		35,599		—		41,223
Non-accrual(4)	—		—		674		4,150		1,078		12,377		93		18,372
Total other commercial real estate	$	61,056	$	199,300	$	277,789	$	238,501	$	141,770	$	529,875	$	27,646	$	1,475,937
Other commercial real estate net loan charge- offs	$	—	$	38	$	1	$	—	$	183	$	(39)	$	—	$	183

⁽¹⁾Represents year-to-date loans originated during 2020.

⁽²⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽³⁾Loans categorized as substandard exhibit well-defined weaknesses that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured, and collection of principal and interest is expected within a reasonable time.

⁽⁴⁾Loans categorized as non-accrual exhibit well-defined weaknesses that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.

Consumer Loan Portfolio by Origination Year

(Dollar amounts in thousands)

	2020(1)		2019		2018		2017		2016		Prior		Revolving Loans		Total
Home equity:
Performing	$	8,231	$	48,696	$	27,783	$	13,809	$	11,878	$	57,053	$	716,288	$	883,738
Non-accrual	—		22		125		264		482		6,801		1,435		9,129
Total home equity	$	8,231	$	48,718	$	27,908	$	14,073	$	12,360	$	63,854	$	717,723	$	892,867
Home equity net loan charge-offs	$	—	$	—	$	1	$	—	$	1	$	42	$	(14)	$	30
1-4 family mortgages:
Performing	$	597,506	$	676,898	$	311,884	$	158,230	$	181,912	$	240,394	$	—	$	2,166,824
Non-accrual	—		—		438		83		63		7,914		—		8,498
Total 1-4 family mortgages	$	597,506	$	676,898	$	312,322	$	158,313	$	181,975	$	248,308	$	—	$	2,175,322
1-4 family mortgages net loan charge-offs	$	—	$	—	$	4	$	—	$	7	$	735	$	—	$	746
Installment:
Performing	$	59,971	$	185,919	$	107,220	$	45,108	$	17,563	$	20,662	$	20,764	$	457,207
Non-accrual	—		—		—		—		—		—		—		—
Total installment	$	59,971	$	185,919	$	107,220	$	45,108	$	17,563	$	20,662	$	20,764	$	457,207
Installment net loan charge-offs	$	44	$	3,757	$	2,200	$	775	$	85	$	393	$	29	$	7,283

⁽¹⁾Represents year-to-date loans originated during 2020.

During the quarter and six months ended June 30, 2020, $16.8 million and $23.8 million, respectively, of revolving loans converted to term loans.

The following tables present credit quality indicators by class for corporate and consumer loans on an amortized cost basis as of December 31, 2019.

Corporate Credit Quality Indicators by Class

(Dollar amounts in thousands)

	Pass		Special Mention(1)		Substandard(2)		Non-accrual(3)		Total
As of December 31, 2019
Commercial and industrial	$	4,324,709	$	47,665	$	79,156	$	29,995	$	4,481,525
Agricultural	350,827		32,764		16,071		5,954		405,616
Commercial real estate:
Office, retail, and industrial	1,747,287		42,230		33,344		25,857		1,848,718
Multi-family	839,615		8,279		5,962		2,697		856,553
Construction	564,495		17,977		10,469		152		593,093
Other commercial real estate	1,295,155		39,788		44,036		4,729		1,383,708
Total commercial real estate	4,446,552		108,274		93,811		33,435		4,682,072
Total corporate loans	$	9,122,088	$	188,703	$	189,038	$	69,384	$	9,569,213

⁽¹⁾Loans categorized as special mention exhibit potential weaknesses that require the close attention of management since these potential weaknesses may result in the deterioration of repayment prospects in the future.

⁽²⁾Loans categorized as substandard exhibit a well-defined weakness that may jeopardize the liquidation of the debt. These loans continue to accrue interest because they are well-secured and collection of principal and interest is expected within a reasonable time.

⁽³⁾Loans categorized as non-accrual exhibit a well-defined weakness that may jeopardize the liquidation of the debt or result in a loss if the deficiencies are not corrected.

Consumer Credit Quality Indicators by Class

(Dollar amounts in thousands)

	Performing		Non-accrual		Total
As of December 31, 2019
Home equity	$	843,011	$	8,443	$	851,454
1-4 family mortgages	1,922,636		4,442		1,927,078
Installment	492,585		—		492,585
Total consumer loans	$	3,258,232	$	12,885	$	3,271,117

Troubled Debt Restructuring Activity Rollforward

The table below presents TDRs by class as of June 30, 2020 and December 31, 2019. See Note 1, "Summary of Significant Accounting Policies," for the accounting policy for TDRs.

TDRs by Class

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Accruing		Non-accrual(1)		Total		Accruing		Non-accrual(1)		Total
Commercial and industrial	$	188	$	9,336	$	9,524	$	227	$	16,420	$	16,647
Agricultural	—		—		—		—		—		—
Commercial real estate:
Office, retail, and industrial	—		2,340		2,340		—		3,600		3,600
Multi-family	160		—		160		163		—		163
Construction	—		—		—		—		—		—
Other commercial real estate	198		—		198		170		—		170
Total commercial real estate	358		2,340		2,698		333		3,600		3,933
Total corporate loans	546		11,676		12,222		560		20,020		20,580
Home equity	31		179		210		36		240		276
1-4 family mortgages	624		238		862		637		—		637
Installment	—		—		—		—		254		254
Total consumer loans	655		417		1,072		673		494		1,167
Total loans	$	1,201	$	12,093	$	13,294	$	1,233	$	20,514	$	21,747

⁽¹⁾These TDRs are included in non-accrual loans in the preceding tables.

A rollforward of the carrying value of TDRs for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

TDR Rollforward

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Accruing
Beginning balance	$	1,216	$	1,844	$	1,233	$	1,866
Additions	—		—		—		12
Net payments	(15)		(20)		(32)		(54)
Net transfers to non-accrual	—		(383)		—		(383)
Ending balance	1,201		1,441		1,201		1,441
Non-accrual
Beginning balance	17,917		9,375		20,514		6,612
Additions	—		—		934		—
Net (payments) advances	(2,595)		(1,447)		(3,253)		1,474
Charge-offs	(3,229)		(470)		(6,102)		(628)
Net transfers from accruing	—		383		—		383
Ending balance	12,093		7,841		12,093		7,841
Total TDRs	$	13,294	$	9,282	$	13,294	$	9,282

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Lease Obligations (Tables)

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Schedule of Future Minimum Lease Liability

The following summary reflects the future minimum payments by year required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year and a reconciliation of those payments to the Company's lease liability as of June 30, 2020.

Lease Liability

(Dollar amounts in thousands)

	As of    June 30, 2020
Year Ending December 31,
2020	$	9,466
2021	18,785
2022	18,711
2023	18,811
2024	18,530
2025 and thereafter	105,995
Total minimum lease payments	190,298
Discount(1)	(28,752)
Lease liability(2)	$	161,546

⁽¹⁾Represents the net present value adjustment related to minimum lease payments.

⁽²⁾Included in accrued interest payable and other liabilities in the Consolidated Statements of Financial Condition.

Schedule of Net Operating Lease Expense

The following table presents net operating lease expense for the quarters and six months ended June 30, 2020 and 2019.

Net Operating Lease Expense

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Lease expense charged to operations	$	4,839	$	4,426	$	9,514	$	8,486
Rental income from premises leased to others (1)	(183)		(165)		(398)		(322)
Net operating lease expense	$	4,656	$	4,261	$	9,116	$	8,164

⁽¹⁾Included as reductions to net occupancy and equipment expense in the Condensed Consolidated Statements of Income.

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Borrowed Funds (Tables)

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Summary of Borrowed Funds

The following table summarizes the Company's borrowed funds by funding source.

Summary of Borrowed Funds

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Securities sold under agreements to repurchase	$	130,667	$	103,515
Federal funds purchased	200,000		160,000
FHLB advances	1,974,528		1,395,243
Total borrowed funds	$	2,305,195	$	1,658,758

Short Term Credit Lines Available For Use

The following table presents short-term credit lines available for use, for which the Company did not have an outstanding balance as of June 30, 2020 and December 31, 2019.

Short-Term Credit Lines Available for Use

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
FRB's Discount Window Primary Credit Program	$	803,068	$	874,256
Available federal funds lines	814,000		718,000
Correspondent bank line of credit	50,000		50,000

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Earnings Per Common Share (Tables)

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The table below displays the calculation of basic and diluted earnings per common share ("EPS").

Basic and Diluted EPS

(Amounts in thousands, except per share data)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Net income	$	19,064	$	47,014	$	38,670	$	93,072
Preferred dividends	(1,037)		—		(1,037)		—
Net income applicable to unvested restricted shares	(187)		(389)		(379)		(792)
Net income applicable to common shares	$	17,840	$	46,625	$	37,254	$	92,280
Weighted-average common shares outstanding:
Weighted-average common shares outstanding (basic)	113,145		108,467		111,533		107,126
Dilutive effect of common stock equivalents	191		—		339		—
Weighted-average diluted common shares outstanding	113,336		108,467		111,872		107,126
Basic EPS	$	0.16	$	0.43	$	0.33	$	0.86
Diluted EPS	$	0.16	$	0.43	$	0.33	$	0.86

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Derivative Instruments and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives

Cash Flow Hedges

(Dollar amounts in thousands)

	As of
	June 30, 2020			December 31, 2019
Gross notional amount outstanding	$	2,035,000		$	1,905,000
Derivative asset fair value in other assets(1)	6,053			727
Derivative liability fair value in other liabilities(1)	198			(119)
Weighted-average interest rate received	0.96		%	1.88		%
Weighted-average interest rate paid	0.77		%	1.74		%
Weighted-average maturity (in years)	2.30			1.18

⁽¹⁾Certain cash flow hedges are transacted through a clearinghouse ("centrally cleared") and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

The following table presents the impact of derivative instruments on net interest income for the quarters and six months ended June 30, 2020 and 2019.

Hedge Income

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Cash Flow Hedges
Interest rate swaps in interest income	$	2,624	$	1,355	$	3,069	$	2,748
Interest rate swaps in interest expense	—		(1,924)		—		(3,948)
Total cash flow hedges	$	2,624	$	(569)	$	3,069	$	(1,200)

Schedule of Derivative Instruments

Other Derivative Instruments

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Gross notional amount outstanding	$	4,589,018	$	4,340,384
Derivative asset fair value in other assets(1)	183,938		61,709
Derivative liability fair value in other liabilities(1)	(55,026)		(18,416)
Fair value of derivative(2)	56,025		18,856

⁽¹⁾Certain other derivative instruments are centrally cleared and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

⁽²⁾This amount represents the fair value if credit risk related contingent features were triggered.

Cash Flow Hedge Accounting on AOCI

The following table presents the impact of derivative instruments on comprehensive income (loss) and the reclassification of gains (losses) from accumulated other comprehensive income (loss) to net interest income for the quarters and six months ended June 30, 2020 and 2019.

Cash Flow Hedge Accounting on AOCI

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Gains (losses) recognized in other comprehensive income
Interest rate swaps in interest income	$	5,951	$	5,944	$	27,955	$	9,297
Interest rate swaps in interest expense	(1,276)		(7,816)		(13,685)		(11,996)
Reclassification of gains (losses) included in net income
Interest rate swaps in interest income	$	2,624	$	1,355	$	3,069	$	2,748
Interest rate swaps in interest expense	—		(1,924)		—		(3,948)

Offsetting Assets

The following table presents the fair value of the Company's derivatives and offsetting positions as of June 30, 2020 and December 31, 2019.

Fair Value of Offsetting Derivatives

(Dollar amounts in thousands)

	As of June 30, 2020				As of December 31, 2019
	Assets		Liabilities		Assets		Liabilities
Gross amounts recognized	$	189,991	$	54,828	$	62,436	$	18,535
Less: amounts offset in the Consolidated Statements of Financial Condition	—		—		—		—
Net amount presented in the Consolidated Statements of   Financial Condition(1)	189,991		54,828		62,436		18,535
Gross amounts not offset in the Consolidated Statements of Financial Condition:
Offsetting derivative positions	(7,495)		(7,495)		(2,674)		(2,674)
Cash collateral pledged	—		(48,430)		—		(15,861)
Net credit exposure	$	182,496	$	(1,097)	$	59,762	$	—

⁽¹⁾Included in other assets or other liabilities in the Consolidated Statements of Financial Condition.

Offsetting Liabilities

The following table presents the fair value of the Company's derivatives and offsetting positions as of June 30, 2020 and December 31, 2019.

Fair Value of Offsetting Derivatives

(Dollar amounts in thousands)

	As of June 30, 2020				As of December 31, 2019
	Assets		Liabilities		Assets		Liabilities
Gross amounts recognized	$	189,991	$	54,828	$	62,436	$	18,535
Less: amounts offset in the Consolidated Statements of Financial Condition	—		—		—		—
Net amount presented in the Consolidated Statements of   Financial Condition(1)	189,991		54,828		62,436		18,535
Gross amounts not offset in the Consolidated Statements of Financial Condition:
Offsetting derivative positions	(7,495)		(7,495)		(2,674)		(2,674)
Cash collateral pledged	—		(48,430)		—		(15,861)
Net credit exposure	$	182,496	$	(1,097)	$	59,762	$	—

⁽¹⁾Included in other assets or other liabilities in the Consolidated Statements of Financial Condition.

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Commitments, Guarantees, and Contingent Liabilities (Tables)

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Schedule of Contractual or Notional Amounts of Financial Instruments

Contractual or Notional Amounts of Financial Instruments

(Dollar amounts in thousands)

	As of
	June 30, 2020		December 31, 2019
Commitments to extend credit:
Commercial, industrial, and agricultural	$	2,276,196	$	1,852,040
Commercial real estate	324,659		296,053
Home equity	578,920		576,956
Other commitments(1)	251,716		251,093
Total commitments to extend credit	$	3,431,491	$	2,976,142
Letters of credit	$	100,827	$	103,684

⁽¹⁾Other commitments includes installment and overdraft protection program commitments.

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Fair Value (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring Basis

The following table provides the fair value for assets and liabilities required to be measured at fair value on a recurring basis in the Consolidated Statements of Financial Condition by level in the fair value hierarchy.

Recurring Fair Value Measurements

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Equity securities	$	24,075	$	14,879	$	—	$	23,703	$	13,400	$	—
Securities available-for-sale
U.S. treasury securities	21,199		—		—		34,075		—		—
U.S. agency securities	—		643,047		—		—		248,424		—
CMOs	—		1,672,129		—		—		1,557,671		—
MBSs	—		715,140		—		—		684,684		—
Municipal securities	—		239,803		—		—		234,431		—
Corporate debt securities	—		144,544		—		—		114,101		—
Total securities available-for-sale	21,199		3,414,663		—		34,075		2,839,311		—
Mortgage servicing rights ("MSRs")(1)	—		—		4,464		—		—		5,858
Derivative assets(1)	—		189,991		—		—		62,436		—
Liabilities
Derivative liabilities(2)	$	—	$	54,828	$	—	$	—	$	18,535	$	—

⁽¹⁾Included in other assets in the Consolidated Statements of Financial Condition.

⁽²⁾Included in other liabilities in the Consolidated Statements of Financial Condition.

Significant Unobservable Inputs Used in the Valuation of MSRs

The following table presents the ranges of significant, unobservable inputs used by the Company to determine the fair value of MSRs as of June 30, 2020 and December 31, 2019.

Significant Unobservable Inputs Used in the Valuation of MSRs

	As of
	June 30, 2020				December 31, 2019
Prepayment speed	7.6	%	-	14.9%	6.7	%	-	12.0%
Maturity (months)	16		-	88	18		-	94
Discount rate	9.4	%	-	12.0%	9.3	%	-	12.0%

Schedule of Servicing Assets at Fair Value

A rollforward of the carrying value of MSRs for the quarters and six months ended June 30, 2020 and 2019 is presented in the following table.

Carrying Value of MSRs

(Dollar amounts in thousands)

	Quarters Ended   June 30,				Six Months Ended   June 30,
	2020		2019		2020		2019
Beginning balance	$	4,874	$	6,228	$	5,858	$	6,730
New MSRs	745		204		901		457
Total gains (losses) included in earnings(1):
Changes in valuation inputs and assumptions	(750)		(389)		(1,658)		(989)
Other changes in fair value(2)	(405)		(212)		(637)		(367)
Ending balance(3)	$	4,464	$	5,831	$	4,464	$	5,831
Contractual servicing fees earned(1)	$	394	$	390	$	797	$	771

⁽¹⁾Included in mortgage banking income in the Condensed Consolidated Statements of Income and related to assets held as of June 30, 2020 and 2019.

⁽²⁾Primarily represents changes in expected future cash flows due to payoffs and paydowns.

⁽³⁾Included in other assets in the Consolidated Statements of Financial Condition.

Fair Value Measurements, Nonrecurring

The following table provides the fair value for each class of assets and liabilities required to be measured at fair value on a non-recurring basis in the Consolidated Statements of Financial Condition by level in the fair value hierarchy.

Non-Recurring Fair Value Measurements

(Dollar amounts in thousands)

	As of June 30, 2020						As of December 31, 2019
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Collateral-dependent non-accrual loans(1)	$	—	$	—	$	53,608	$	—	$	—	$	41,326
OREO(2)	—		—		530		—		—		3,325
Loans held-for-sale(3)	—		—		45,466		—		—		36,032
Assets held-for-sale(4)	—		—		5,180		—		—		6,824

⁽¹⁾Includes non-accrual loans with charge-offs and non-accrual loans with a specific allowance during the periods presented.

⁽²⁾Includes OREO with fair value adjustments subsequent to initial transfer that occurred during the periods presented.

⁽³⁾Included in other assets in the Consolidated Statements of Financial Condition.

⁽⁴⁾Included in premises, furniture, and equipment in the Consolidated Statements of Financial Condition.

Fair Value, by Balance Sheet Grouping

For certain financial instruments that are not required to be measured at fair value in the Consolidated Statements of Financial Condition, the Company must disclose the estimated fair values and the level within the fair value hierarchy as shown in the following table.

Fair Value Measurements of Other Financial Instruments

(Dollar amounts in thousands)

		As of
		June 30, 2020				December 31, 2019
	Fair Value Hierarchy Level	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Cash and due from banks	1	$	304,445	$	304,445	$	214,894	$	214,894
Interest-bearing deposits in other banks	2	637,856		637,856		84,327		84,327
Securities held-to-maturity	2	19,628		19,676		21,997		21,234
FHLB and FRB stock	2	148,512		148,512		115,409		115,409
Loans	3	14,693,606		14,739,129		12,733,200		12,535,848
Investment in BOLI	3	299,649		299,649		296,351		296,351
Accrued interest receivable	3	63,162		63,162		59,716		59,716
Liabilities
Deposits	2	$	15,657,656	$	15,667,051	$	13,251,278	$	13,247,871
Borrowed funds	2	2,305,195		2,305,195		1,658,758		1,658,758
Senior and subordinated debt	2	234,358		266,003		233,948		277,203
Accrued interest payable	2	7,633		7,633		10,502		10,502

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Recent Accounting Pronouncements and Other Guidance (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Mar. 31, 2020	Jan. 01, 2020	Dec. 31, 2019		Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss	$ 247,677	$ 226,701	$ 76,000	$ 109,222		$ 106,929	$ 104,779	$ 103,419
Allowance for securities held-to-maturity	(220)		220
Cumulative effect adjustment	(2,656,211)	(2,435,707)		(2,370,793)		(2,300,573)	(2,159,471)	(2,054,998)
COVID-19, loans modification	1,900,000
Cumulative Effect, Period Of Adoption, Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss				75,757
Cumulative effect adjustment				26,821	[1]			(47,257)	[2]
Unfunded Loan Commitments
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss			5,600
PCD
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss	44,434		35,700	3,197
Non-PCD
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss			8,500
Loans
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for credit loss			$ 26,000
Retained Earnings
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment	$ (1,359,407)	$ (1,357,395)		(1,380,612)		$ (1,304,756)	$ (1,273,245)	(1,192,767)
Retained Earnings | Cumulative Effect, Period Of Adoption, Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment				$ 26,821	[1]			$ (47,257)	[2]

[1] As a result of accounting guidance adopted in the first quarter of 2020, a portion of the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

[2] As a result of accounting guidance adopted in the first quarter of 2019, the remaining deferred gain on a sale-leaseback transaction was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2019.

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Acquisitions - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands			3 Months Ended		6 Months Ended
	Mar. 09, 2020	May 09, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Jan. 16, 2019
Business Acquisition [Line Items]
Acquisition and integration related expenses			$ 5,249	$ 9,514	$ 10,721	$ 13,205
Bankmanagers Corporation
Business Acquisition [Line Items]
Total assets	$ 1,151,236
Total deposits	950,076
Loans	$ 685,451
Fixed exchange ratio (in shares)	29.9675
Cash paid per share (in dollars per share)	$ 623.02
Special dividends paid (in dollars per share)	$ 346.00
Consideration transferred	$ 174,382
Common stock, shares issued (in shares)	4,930,231
Cash paid	$ 102,499
Goodwill	$ 62,433
Bridgeview Bancorp, Inc.
Business Acquisition [Line Items]
Total assets		$ 1,165,815
Total deposits		986,754
Loans		$ 709,438
Fixed exchange ratio (in shares)		0.2767
Cash paid per share (in dollars per share)		$ 1.66
Consideration transferred		$ 135,352
Common stock, shares issued (in shares)		4,728,541
Cash paid		$ 37,140
Goodwill		$ 63,231
Northern Oak Wealth Management, Inc.
Business Acquisition [Line Items]
Assets under management acquired							$ 800,000

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Acquisitions - Schedule of Acquisition Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	Mar. 09, 2020	May 09, 2019
Bankmanagers Corporation
Assets
Cash and due from banks and interest-bearing deposits in other banks	$ 244,781
Equity securities	0
Securities available-for-sale	136,856
Securities held-to-maturity	300
FHLB and FRB stock	0
Loans	685,451
OREO	2,001
Goodwill	62,433
Other intangible assets	3,068
Premises, furniture, and equipment	2,550
Accrued interest receivable and other assets	13,796
Total assets	1,151,236
Liabilities
Noninterest-bearing deposits	356,050
Interest-bearing deposits	594,026
Total deposits	950,076
Borrowed funds	11,532
Senior and subordinated debt	0
Accrued interest payable and other liabilities	15,246
Total liabilities	976,854
Consideration Paid
Common stock (2020 – 4,930,231, shares issued at $14.58 per share, 2019 – 4,728,541, shares issued at $20.77 per share), net of issuance costs	71,883
Cash paid	102,499
Total consideration paid	$ 174,382
Common stock, shares issued (in shares)	4,930,231
Shares issued (in dollars per share)	$ 14.58
Bridgeview Bancorp, Inc.
Assets
Cash and due from banks and interest-bearing deposits in other banks		$ 35,097
Equity securities		6,966
Securities available-for-sale		263,090
Securities held-to-maturity		13,426
FHLB and FRB stock		1,481
Loans		709,438
OREO		5,436
Goodwill		63,231
Other intangible assets		15,603
Premises, furniture, and equipment		16,138
Accrued interest receivable and other assets		35,909
Total assets		1,165,815
Liabilities
Noninterest-bearing deposits		179,267
Interest-bearing deposits		807,487
Total deposits		986,754
Borrowed funds		1,746
Senior and subordinated debt		29,360
Accrued interest payable and other liabilities		12,603
Total liabilities		1,030,463
Consideration Paid
Common stock (2020 – 4,930,231, shares issued at $14.58 per share, 2019 – 4,728,541, shares issued at $20.77 per share), net of issuance costs		98,212
Cash paid		37,140
Total consideration paid		$ 135,352
Common stock, shares issued (in shares)		4,728,541
Shares issued (in dollars per share)		$ 20.77

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Securities - Securities Portfolio (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Jan. 01, 2020	Dec. 31, 2019
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 3,354,125		$ 2,851,479
Gross Unrealized Gains	86,368		31,205
Gross Unrealized Losses	(4,631)		(9,298)
Fair Value	3,435,862		2,873,386
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	19,628
Gross Unrealized Gains	48
Gross Unrealized Losses	0
Fair Value	19,676
Allowance for securities held-to-maturity	(220)	$ 220
Securities held-to-maturity, at amortized cost, net	19,628		21,997
Fair value, net of allowance	19,676
Debt and Equity Securities, FV-NI [Line Items]
Equity securities	43,954		42,136
U.S. treasury securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	20,992		33,939
Gross Unrealized Gains	207		137
Gross Unrealized Losses	0		(1)
Fair Value	21,199		34,075
U.S. agency securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	640,253		249,502
Gross Unrealized Gains	4,166		758
Gross Unrealized Losses	(1,372)		(1,836)
Fair Value	643,047		248,424
Collateralized mortgage obligations ("CMOs")
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	1,624,609		1,547,805
Gross Unrealized Gains	49,059		14,893
Gross Unrealized Losses	(1,539)		(5,027)
Fair Value	1,672,129		1,557,671
Other mortgage-backed securities ("MBSs")
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	695,218		678,804
Gross Unrealized Gains	20,159		7,728
Gross Unrealized Losses	(237)		(1,848)
Fair Value	715,140		684,684
Municipal securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	229,414		228,632
Gross Unrealized Gains	10,410		5,898
Gross Unrealized Losses	(21)		(99)
Fair Value	239,803		234,431
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	19,848		21,997
Gross Unrealized Gains	48		0
Gross Unrealized Losses	0		(763)
Fair Value	19,896		21,234
Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	143,639		112,797
Gross Unrealized Gains	2,367		1,791
Gross Unrealized Losses	(1,462)		(487)
Fair Value	144,544		114,101
Equity securities
Debt and Equity Securities, FV-NI [Line Items]
Equity securities	$ 43,954		$ 42,136

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Securities - Additional Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]
Interest receivable on securities	$ 13,600,000		$ 13,600,000		$ 11,300,000
Available-for-sale securities pledged	1,500,000,000		1,500,000,000		1,300,000,000
Held-to-maturity securities pledged as collateral	0		0		$ 0
Realized gains (losses) on securities available-for-sale	$ 0	$ 0	$ (1,005,000)	$ 0

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Securities - Remaining Contractual Maturity of Securities (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Available-for-sale Securities, Amortized Cost [Abstract]
One year or less	$ 270,623
After one year to five years	185,159
After five years to ten years	578,516
After ten years	0
Securities that do not have a single contractual maturity date	2,319,827
Amortized Cost	3,354,125	$ 2,851,479
Fair Value
One year or less	274,363
After one year to five years	187,718
After five years to ten years	586,512
After ten years	0
Securities that do not have a single contractual maturity date	2,387,269
Fair Value	3,435,862	$ 2,873,386
Held-to-maturity Securities, Amortized Cost [Abstract]
One year or less	8,070
After one year to five years	5,452
After five years to ten years	3,315
After ten years	2,791
Securities that do not have a single contractual maturity date	0
Amortized Cost	19,628
Held-to-maturity Securities, Fair Value [Abstract]
One year or less	8,089
After one year to five years	5,465
After five years to ten years	3,323
After ten years	2,799
Securities that do not have a single contractual maturity date	0
Fair Value	$ 19,676

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Securities - Securities In An Unrealized Loss Position (Details) $ in Thousands	Jun. 30, 2020 USD ($) security	Dec. 31, 2019 USD ($) security
Securities Available-for-Sale
Number of Securities | security	90	286
Fair Value
Less Than 12 Months	$ 319,709	$ 375,608
12 Months or Longer	89,898	608,390
Total	409,607	983,998
Unrealized Losses
Less Than 12 Months	2,926	4,744
12 Months or Longer	1,705	4,554
Total	$ 4,631	$ 9,298
U.S. treasury securities
Securities Available-for-Sale
Number of Securities | security		5
Fair Value
Less Than 12 Months		$ 4,966
12 Months or Longer		0
Total		4,966
Unrealized Losses
Less Than 12 Months		1
12 Months or Longer		0
Total		$ 1
U.S. agency securities
Securities Available-for-Sale
Number of Securities | security	23	52
Fair Value
Less Than 12 Months	$ 73,659	$ 97,729
12 Months or Longer	13,927	49,387
Total	87,586	147,116
Unrealized Losses
Less Than 12 Months	1,149	1,200
12 Months or Longer	223	636
Total	$ 1,372	$ 1,836
CMOs
Securities Available-for-Sale
Number of Securities | security	41	148
Fair Value
Less Than 12 Months	$ 139,578	$ 187,470
12 Months or Longer	33,967	412,083
Total	173,545	599,553
Unrealized Losses
Less Than 12 Months	1,379	2,177
12 Months or Longer	160	2,850
Total	$ 1,539	$ 5,027
MBSs
Securities Available-for-Sale
Number of Securities | security	14	59
Fair Value
Less Than 12 Months	$ 64,778	$ 66,340
12 Months or Longer	3,805	121,861
Total	68,583	188,201
Unrealized Losses
Less Than 12 Months	223	996
12 Months or Longer	14	852
Total	$ 237	$ 1,848
Municipal securities
Securities Available-for-Sale
Number of Securities | security	1	16
Fair Value
Less Than 12 Months	$ 1,745	$ 9,384
12 Months or Longer	0	3,104
Total	1,745	12,488
Unrealized Losses
Less Than 12 Months	21	89
12 Months or Longer	0	10
Total	$ 21	$ 99
Corporate debt securities
Securities Available-for-Sale
Number of Securities | security	11	6
Fair Value
Less Than 12 Months	$ 39,949	$ 9,719
12 Months or Longer	38,199	21,955
Total	78,148	31,674
Unrealized Losses
Less Than 12 Months	154	281
12 Months or Longer	1,308	206
Total	$ 1,462	$ 487

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Loans - Loan Portfolio (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	$ 14,933,658	$ 12,840,330
Deferred loan fees included in total loans	9,691	7,972
Overdrawn demand deposits included in total loans	7,676	10,675
Interest receivable on loan portfolio	49,500	48,400
Commercial Industrial And Agricultural | Commercial and industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	4,789,556	4,481,525
Commercial Industrial And Agricultural | Agricultural
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	381,124	405,616
Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	5,058,179	4,682,072
Commercial real estate | Office, retail, and industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	2,020,318	1,848,718
Commercial real estate | Multi-family
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	874,861	856,553
Commercial real estate | Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	687,063	593,093
Commercial real estate | Other commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	1,475,937	1,383,708
Commercial Portfolio Segment, Excluding PPP Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	10,228,859	9,569,213
PPP loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	1,179,403	0
Total corporate loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	11,408,262	9,569,213
Consumer loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	3,525,396	3,271,117
Consumer loans | Home equity
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	892,867	851,454
Consumer loans | 1-4 family mortgages
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	2,175,322	1,927,078
Consumer loans | Installment
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans	$ 457,207	$ 492,585

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Loans - Loans Sales (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total net gains on loan sales		$ 4,601	$ 1,981	$ 7,230	$ 3,391
Corporate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	36,152	132,034	182,613	189,573
Consumer Loan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	179,410	270,692	394,552	381,874
Corporate loan sales
Accounts, Notes, Loans and Financing Receivable [Line Items]
Proceeds from sales		295	2,178	4,598	5,376
Less book value of loans sold		289	2,132	4,477	5,248
Total net gains on loan sales	[2]	6	46	121	128
1-4 family mortgage loan sales
Accounts, Notes, Loans and Financing Receivable [Line Items]
Proceeds from sales		173,251	95,408	292,410	154,191
Less book value of loans sold		168,656	93,473	285,301	150,928
Total net gains on loan sales	[3]	4,595	1,935	7,109	3,263
1-4 family mortgage loan sales | Consumer Loan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	179,410	231,533	249,585	304,463
Commercial and industrial | Corporate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	22,894	128,891	168,716	181,610
Office, retail, and industrial | Corporate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	0	1,711	0	1,711
Construction | Corporate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	3,258	1,432	3,897	2,266
Other commercial real estate | Corporate Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	10,000	0	10,000	3,986
Home equity | Consumer Loan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Payments for loan purchases	[1]	$ 0	$ 39,159	$ 144,967	$ 77,411

[1] Consists of the Company's portion of loan participations purchased.

[2] Net gains on corporate loan sales are included in other service charges, commissions, and fees in the Condensed Consolidated Statements of Income.

[3] Net gains on 1-4 family mortgage loan sales are included in mortgage banking income in the Condensed Consolidated Statements of Income.⁽³⁾Consists of the Company's portion of loan participations purchased.

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Acquired Loans - Schedule of Acquired Loans (Details) - USD ($) $ in Thousands		Jun. 30, 2020	Dec. 31, 2019
Acquired loans
Acquired Loans (Details) - Acquired Loans [Line Items]
Non-PCD	[1],[2]	$ 1,516,157	$ 1,216,133
Total	[1],[2]	1,759,364	1,383,316
Receivables acquired with deteriorated credit quality
Acquired Loans (Details) - Acquired Loans [Line Items]
PCD		243,207	167,183
Receivables acquired with deteriorated credit quality | Acquired loans
Acquired Loans (Details) - Acquired Loans [Line Items]
PCD	[1],[2]	$ 243,207	$ 167,183

[1] Included in loans in the Consolidated Statements of Financial Condition.⁽²⁾Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

[2] Prior to the adoption of CECL on January 1, 2020, loans that had evidence of credit deterioration since origination and for which it was probable at acquisition that the Company would not collect all contractually required principal and interest payments were classified as PCI.

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Acquired Loans - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Certain Loans Acquired in Transfer Accounted for as Debt Securities Accretable Yield Movement Schedule [Line Items]
Outstanding balance of PCI loans	$ 284.3		$ 284.3		$ 243.0
Acquired and covered receivables
Certain Loans Acquired in Transfer Accounted for as Debt Securities Accretable Yield Movement Schedule [Line Items]
Accretion on acquired loans	$ 7.0	$ 10.3	$ 13.9	$ 16.7

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Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - Aging Analysis of Past Due Loans and Non-Performing Loans by Class (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Past Due [Line Items]
Current	$ 14,780,524	$ 12,754,845
Total Past Due	153,134	85,485
Total Loans	14,933,658	12,840,330
Non-accrual	139,160	82,269
90 Days or More Past Due, Still Accruing Interest	3,241	5,001
30-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	41,532	35,192
90 Days or More Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	111,602	50,293
Commercial Industrial And Agricultural
Financing Receivable, Past Due [Line Items]
Total Loans	5,170,680	4,887,141
Commercial Industrial And Agricultural | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Current	4,750,932	4,455,381
Total Past Due	38,624	26,144
Total Loans	4,789,556	4,481,525
Non-accrual	28,349	29,995
90 Days or More Past Due, Still Accruing Interest	1,090	2,207
Commercial Industrial And Agricultural | Agricultural
Financing Receivable, Past Due [Line Items]
Current	373,910	398,676
Total Past Due	7,214	6,940
Total Loans	381,124	405,616
Non-accrual	8,494	5,954
90 Days or More Past Due, Still Accruing Interest	0	358
Commercial Industrial And Agricultural | 30-89 Days Past Due | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total Past Due	20,550	11,468
Commercial Industrial And Agricultural | 30-89 Days Past Due | Agricultural
Financing Receivable, Past Due [Line Items]
Total Past Due	0	850
Commercial Industrial And Agricultural | 90 Days or More Past Due | Commercial and industrial
Financing Receivable, Past Due [Line Items]
Total Past Due	18,074	14,676
Commercial Industrial And Agricultural | 90 Days or More Past Due | Agricultural
Financing Receivable, Past Due [Line Items]
Total Past Due	7,214	6,090
Commercial real estate
Financing Receivable, Past Due [Line Items]
Current	4,970,994	4,649,826
Total Past Due	87,185	32,246
Total Loans	5,058,179	4,682,072
Non-accrual	84,690	33,435
90 Days or More Past Due, Still Accruing Interest	709	1,075
Commercial real estate | Office, retail, and industrial
Financing Receivable, Past Due [Line Items]
Current	1,982,798	1,830,321
Total Past Due	37,520	18,397
Total Loans	2,020,318	1,848,718
Non-accrual	35,915	25,857
90 Days or More Past Due, Still Accruing Interest	596	546
Commercial real estate | Multi-family
Financing Receivable, Past Due [Line Items]
Current	870,430	853,762
Total Past Due	4,431	2,791
Total Loans	874,861	856,553
Non-accrual	3,121	2,697
90 Days or More Past Due, Still Accruing Interest	0	0
Commercial real estate | Construction
Financing Receivable, Past Due [Line Items]
Current	658,892	588,065
Total Past Due	28,171	5,028
Total Loans	687,063	593,093
Non-accrual	27,282	152
90 Days or More Past Due, Still Accruing Interest	88	0
Commercial real estate | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Current	1,458,874	1,377,678
Total Past Due	17,063	6,030
Total Loans	1,475,937	1,383,708
Non-accrual	18,372	4,729
90 Days or More Past Due, Still Accruing Interest	25	529
Commercial real estate | 30-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	12,457	11,263
Commercial real estate | 30-89 Days Past Due | Office, retail, and industrial
Financing Receivable, Past Due [Line Items]
Total Past Due	4,973	2,943
Commercial real estate | 30-89 Days Past Due | Multi-family
Financing Receivable, Past Due [Line Items]
Total Past Due	1,538	211
Commercial real estate | 30-89 Days Past Due | Construction
Financing Receivable, Past Due [Line Items]
Total Past Due	801	4,876
Commercial real estate | 30-89 Days Past Due | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Total Past Due	5,145	3,233
Commercial real estate | 90 Days or More Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	74,728	20,983
Commercial real estate | 90 Days or More Past Due | Office, retail, and industrial
Financing Receivable, Past Due [Line Items]
Total Past Due	32,547	15,454
Commercial real estate | 90 Days or More Past Due | Multi-family
Financing Receivable, Past Due [Line Items]
Total Past Due	2,893	2,580
Commercial real estate | 90 Days or More Past Due | Construction
Financing Receivable, Past Due [Line Items]
Total Past Due	27,370	152
Commercial real estate | 90 Days or More Past Due | Other commercial real estate
Financing Receivable, Past Due [Line Items]
Total Past Due	11,918	2,797
Commercial Portfolio Segment, Excluding PPP Loans
Financing Receivable, Past Due [Line Items]
Current	10,095,836
Total Past Due	133,023
Total Loans	10,228,859
Non-accrual	121,533
90 Days or More Past Due, Still Accruing Interest	1,799
Commercial Portfolio Segment, Excluding PPP Loans | 30-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	33,007
Commercial Portfolio Segment, Excluding PPP Loans | 90 Days or More Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	100,016
PPP loans
Financing Receivable, Past Due [Line Items]
Total Past Due	0
Total Loans	1,179,403
Non-accrual	0
90 Days or More Past Due, Still Accruing Interest	0
PPP loans | 30-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0
PPP loans | 90 Days or More Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	0
Total corporate loans
Financing Receivable, Past Due [Line Items]
Current	11,275,239	9,503,883
Total Past Due	133,023	65,330
Total Loans	11,408,262	9,569,213
Non-accrual	121,533	69,384
90 Days or More Past Due, Still Accruing Interest	1,799	3,640
Total corporate loans | 30-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	33,007	23,581
Total corporate loans | 90 Days or More Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	100,016	41,749
Consumer loans
Financing Receivable, Past Due [Line Items]
Current	3,505,285	3,250,962
Total Past Due	20,111	20,155
Total Loans	3,525,396	3,271,117
Non-accrual	17,627	12,885
90 Days or More Past Due, Still Accruing Interest	1,442	1,361
Consumer loans | Home equity
Financing Receivable, Past Due [Line Items]
Current	885,678	841,908
Total Past Due	7,189	9,546
Total Loans	892,867	851,454
Non-accrual	9,129	8,443
90 Days or More Past Due, Still Accruing Interest	187	146
Consumer loans | 1-4 family mortgages
Financing Receivable, Past Due [Line Items]
Current	2,164,611	1,917,648
Total Past Due	10,711	9,430
Total Loans	2,175,322	1,927,078
Non-accrual	8,498	4,442
90 Days or More Past Due, Still Accruing Interest	0	1,203
Consumer loans | Installment
Financing Receivable, Past Due [Line Items]
Current	454,996	491,406
Total Past Due	2,211	1,179
Total Loans	457,207	492,585
Non-accrual	0	0
90 Days or More Past Due, Still Accruing Interest	1,255	12
Consumer loans | 30-89 Days Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	8,525	11,611
Consumer loans | 30-89 Days Past Due | Home equity
Financing Receivable, Past Due [Line Items]
Total Past Due	2,641	4,992
Consumer loans | 30-89 Days Past Due | 1-4 family mortgages
Financing Receivable, Past Due [Line Items]
Total Past Due	4,928	5,452
Consumer loans | 30-89 Days Past Due | Installment
Financing Receivable, Past Due [Line Items]
Total Past Due	956	1,167
Consumer loans | 90 Days or More Past Due
Financing Receivable, Past Due [Line Items]
Total Past Due	11,586	8,544
Consumer loans | 90 Days or More Past Due | Home equity
Financing Receivable, Past Due [Line Items]
Total Past Due	4,548	4,554
Consumer loans | 90 Days or More Past Due | 1-4 family mortgages
Financing Receivable, Past Due [Line Items]
Total Past Due	5,783	3,978
Consumer loans | 90 Days or More Past Due | Installment
Financing Receivable, Past Due [Line Items]
Total Past Due	$ 1,255	$ 12

XML

Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - Allowance for Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	$ 226,701	$ 104,779	$ 109,222	$ 103,419
Allowance established for acquired PCD loans	1,250		15,554
Charge-offs	(14,234)	(11,424)	(28,164)	(22,201)
Recoveries	1,311	2,083	3,127	3,776
Net charge-offs	(12,923)	(9,341)	(25,037)	(18,425)
Provision for loan losses and other	32,649	11,491	72,181	21,935
Ending balance	247,677	106,929	247,677	106,929
Allowance for Unfunded Commitments
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	6,753	1,200	1,200	1,200
Allowance established for acquired PCD loans	872		872
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Net charge-offs	0	0	0	0
Provision for loan losses and other	0	0	0	0
Ending balance	7,625	1,200	7,625	1,200
Commercial, Industrial, and Agricultural
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	113,733	64,685	62,830	63,276
Allowance established for acquired PCD loans	378		12,640
Charge-offs	(5,673)	(6,516)	(12,739)	(12,967)
Recoveries	820	1,258	1,979	2,559
Net charge-offs	(4,853)	(5,258)	(10,760)	(10,408)
Provision for loan losses and other	14,719	6,937	39,108	13,496
Ending balance	123,977	66,364	123,977	66,364
Commercial Real Estate
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			18,635
Ending balance	63,136		63,136
Commercial Real Estate | Office, Retail, and Industrial
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	25,856	7,679	7,580	7,900
Allowance established for acquired PCD loans	0		2,003
Charge-offs	(3,092)	(1,605)	(3,430)	(2,233)
Recoveries	6	151	15	161
Net charge-offs	(3,086)	(1,454)	(3,415)	(2,072)
Provision for loan losses and other	1,671	1,270	6,587	1,667
Ending balance	24,441	7,495	24,441	7,495
Commercial Real Estate | Multi-family
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	3,689	2,216	2,950	2,464
Allowance established for acquired PCD loans	0		0
Charge-offs	(9)	0	(19)	(340)
Recoveries	0	0	5	1
Net charge-offs	(9)	0	(14)	(339)
Provision for loan losses and other	1,631	(57)	1,978	34
Ending balance	5,311	2,159	5,311	2,159
Commercial Real Estate | Construction
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	11,297	2,131	1,697	2,173
Allowance established for acquired PCD loans	0		0
Charge-offs	(798)	0	(2,606)	(6)
Recoveries	0	10	0	16
Net charge-offs	(798)	10	(2,606)	10
Provision for loan losses and other	1,023	(279)	2,131	(321)
Ending balance	11,522	1,862	11,522	1,862
Commercial Real Estate | Other Commercial Real Estate
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	18,554	4,930	6,408	4,934
Allowance established for acquired PCD loans	0		0
Charge-offs	(31)	(329)	(339)	(539)
Recoveries	12	45	156	66
Net charge-offs	(19)	(284)	(183)	(473)
Provision for loan losses and other	3,327	351	4,210	536
Ending balance	21,862	4,997	21,862	4,997
Consumer
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			26,557
Ending balance	52,939		52,939
Consumer | Consumer
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance	46,819	21,938	26,557	21,472
Allowance established for acquired PCD loans	0		39
Charge-offs	(4,631)	(2,974)	(9,031)	(6,116)
Recoveries	473	619	972	973
Net charge-offs	(4,158)	(2,355)	(8,059)	(5,143)
Provision for loan losses and other	10,278	3,269	18,167	6,523
Ending balance	$ 52,939	$ 22,852	52,939	$ 22,852
Cumulative Effect, Period Of Adoption, Adjustment
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			75,757
Cumulative Effect, Period Of Adoption, Adjustment | Allowance for Unfunded Commitments
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			5,553
Cumulative Effect, Period Of Adoption, Adjustment | Commercial, Industrial, and Agricultural
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			20,159
Cumulative Effect, Period Of Adoption, Adjustment | Commercial Real Estate | Office, Retail, and Industrial
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			11,686
Cumulative Effect, Period Of Adoption, Adjustment | Commercial Real Estate | Multi-family
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			397
Cumulative Effect, Period Of Adoption, Adjustment | Commercial Real Estate | Construction
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			10,300
Cumulative Effect, Period Of Adoption, Adjustment | Commercial Real Estate | Other Commercial Real Estate
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			11,427
Cumulative Effect, Period Of Adoption, Adjustment | Consumer | Consumer
Allowance for Credit Losses by Portfolio Segment [Roll Forward]
Beginning balance			$ 16,235

XML

Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - Loans and Related Allowance for Credit Losses by Portfolio Segment (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Mar. 31, 2020	Jan. 01, 2020	Dec. 31, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	$ 74,580			$ 64,321
Loans, Collectively Evaluated for Impairment	14,615,871			12,608,826
Loans	14,933,658			12,840,330
Allowance for Credit Losses Individually Evaluated for Impairment	5,734			3,992
Allowance for Credit Losses Collectively Evaluated for Impairment	197,509			102,033
Total Allowance for Credit Losses	247,677	$ 226,701	$ 76,000	109,222	$ 106,929	$ 104,779	$ 103,419
PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	243,207			167,183
Total Allowance for Credit Losses	44,434		$ 35,700	3,197
Commercial Industrial And Agricultural
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	25,190			34,142
Loans, Collectively Evaluated for Impairment	5,049,876			4,807,114
Loans	5,170,680			4,887,141
Allowance for Credit Losses Individually Evaluated for Impairment	4,805			3,414
Allowance for Credit Losses Collectively Evaluated for Impairment	102,735			59,108
Total Allowance for Credit Losses	123,977	113,733		62,830	66,364	64,685	63,276
Commercial Industrial And Agricultural | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	95,614			45,885
Total Allowance for Credit Losses	16,437			308
Commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	49,367			30,179
Loans, Collectively Evaluated for Impairment	4,884,577			4,552,796
Loans	5,058,179			4,682,072
Allowance for Credit Losses Individually Evaluated for Impairment	929			578
Allowance for Credit Losses Collectively Evaluated for Impairment	35,046			16,301
Total Allowance for Credit Losses	63,136			18,635
Commercial real estate | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	124,235			99,097
Total Allowance for Credit Losses	27,161			1,756
Commercial Portfolio Segment, Excluding PPP Loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	74,557
Loans, Collectively Evaluated for Impairment	9,934,453
Loans	10,228,859
Allowance for Credit Losses Individually Evaluated for Impairment	5,734
Allowance for Credit Losses Collectively Evaluated for Impairment	137,781
Total Allowance for Credit Losses	187,113
Commercial Portfolio Segment, Excluding PPP Loans | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	219,849
Total Allowance for Credit Losses	43,598
PPP loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	0
Loans, Collectively Evaluated for Impairment	1,179,403
Loans	1,179,403
Allowance for Credit Losses Individually Evaluated for Impairment	0
Allowance for Credit Losses Collectively Evaluated for Impairment	0
Total Allowance for Credit Losses	0
PPP loans | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	0
Total Allowance for Credit Losses	0
Total corporate loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	74,557			64,321
Loans, Collectively Evaluated for Impairment	11,113,856			9,359,910
Loans	11,408,262			9,569,213
Allowance for Credit Losses Individually Evaluated for Impairment	5,734			3,992
Allowance for Credit Losses Collectively Evaluated for Impairment	137,781			75,409
Total Allowance for Credit Losses	187,113			81,465
Total corporate loans | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	219,849			144,982
Total Allowance for Credit Losses	43,598			2,064
Consumer loans
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	23			0
Loans, Collectively Evaluated for Impairment	3,502,015			3,248,916
Loans	3,525,396			3,271,117
Allowance for Credit Losses Individually Evaluated for Impairment	0			0
Allowance for Credit Losses Collectively Evaluated for Impairment	52,103			25,424
Total Allowance for Credit Losses	52,939			26,557
Consumer loans | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	23,358			22,201
Total Allowance for Credit Losses	836			1,133
Office, retail, and industrial | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	25,165			24,820
Loans, Collectively Evaluated for Impairment	1,956,597			1,795,557
Loans	2,020,318			1,848,718
Allowance for Credit Losses Individually Evaluated for Impairment	885			578
Allowance for Credit Losses Collectively Evaluated for Impairment	14,964			6,899
Total Allowance for Credit Losses	24,441	25,856		7,580	7,495	7,679	7,900
Office, retail, and industrial | Commercial real estate | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	38,556			28,341
Total Allowance for Credit Losses	8,592			103
Multi-family | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	1,785			1,995
Loans, Collectively Evaluated for Impairment	871,545			851,857
Loans	874,861			856,553
Allowance for Credit Losses Individually Evaluated for Impairment	0			0
Allowance for Credit Losses Collectively Evaluated for Impairment	5,126			2,854
Total Allowance for Credit Losses	5,311	3,689		2,950	2,159	2,216	2,464
Multi-family | Commercial real estate | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	1,531			2,701
Total Allowance for Credit Losses	185			96
Construction | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	18,611			123
Loans, Collectively Evaluated for Impairment	646,355			581,747
Loans	687,063			593,093
Allowance for Credit Losses Individually Evaluated for Impairment	0			0
Allowance for Credit Losses Collectively Evaluated for Impairment	4,624			1,681
Total Allowance for Credit Losses	11,522	11,297		1,697	1,862	2,131	2,173
Construction | Commercial real estate | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	22,097			11,223
Total Allowance for Credit Losses	6,898			16
Other commercial real estate | Commercial real estate
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	3,806			3,241
Loans, Collectively Evaluated for Impairment	1,410,080			1,323,635
Loans	1,475,937			1,383,708
Allowance for Credit Losses Individually Evaluated for Impairment	44			0
Allowance for Credit Losses Collectively Evaluated for Impairment	10,332			4,867
Total Allowance for Credit Losses	21,862	18,554		6,408	4,997	4,930	4,934
Other commercial real estate | Commercial real estate | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	62,051			56,832
Total Allowance for Credit Losses	11,486			1,541
Allowance for unfunded commitments
Financing Receivable, Allowance for Credit Loss [Line Items]
Loans, Individually Evaluated for Impairment	0			0
Loans, Collectively Evaluated for Impairment	0			0
Loans	0			0
Allowance for Credit Losses Individually Evaluated for Impairment	0			0
Allowance for Credit Losses Collectively Evaluated for Impairment	7,625			1,200
Total Allowance for Credit Losses	7,625	$ 6,753		1,200	$ 1,200	$ 1,200	$ 1,200
Allowance for unfunded commitments | PCD
Financing Receivable, Allowance for Credit Loss [Line Items]
PCD	0			0
Total Allowance for Credit Losses	$ 0			$ 0

XML

Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - Collateral-dependent Loans and Non-accrual Loans With No Related Allowance by Class (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	$ 139,160	$ 82,269
Non-accrual Loans With No Related Allowance	61,383
Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	122,964
Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	49,954
Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	3,169
Commercial Industrial And Agricultural | Commercial and industrial
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	28,349	29,995
Non-accrual Loans With No Related Allowance	6,338
Commercial Industrial And Agricultural | Commercial and industrial | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	6,870
Commercial Industrial And Agricultural | Commercial and industrial | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	45,235
Commercial Industrial And Agricultural | Commercial and industrial | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	3,169
Commercial Industrial And Agricultural | Agricultural
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	8,494	5,954
Non-accrual Loans With No Related Allowance	4,485
Commercial Industrial And Agricultural | Agricultural | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	3,417
Commercial Industrial And Agricultural | Agricultural | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	4,719
Commercial Industrial And Agricultural | Agricultural | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	84,690	33,435
Non-accrual Loans With No Related Allowance	49,910
Commercial Real Estate | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	109,768
Commercial Real Estate | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Office, retail, and industrial
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	35,915	25,857
Non-accrual Loans With No Related Allowance	17,293
Commercial Real Estate | Office, retail, and industrial | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	44,538
Commercial Real Estate | Office, retail, and industrial | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Office, retail, and industrial | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Multi-family
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	3,121	2,697
Non-accrual Loans With No Related Allowance	1,785
Commercial Real Estate | Multi-family | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	2,606
Commercial Real Estate | Multi-family | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Multi-family | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Construction
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	27,282	152
Non-accrual Loans With No Related Allowance	19,043
Commercial Real Estate | Construction | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	28,779
Commercial Real Estate | Construction | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Construction | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Other commercial real estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	18,372	4,729
Non-accrual Loans With No Related Allowance	11,789
Commercial Real Estate | Other commercial real estate | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	33,845
Commercial Real Estate | Other commercial real estate | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Commercial Real Estate | Other commercial real estate | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Total corporate loans
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	121,533	69,384
Non-accrual Loans With No Related Allowance	60,733
Total corporate loans | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	120,055
Total corporate loans | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	49,954
Total corporate loans | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	3,169
Consumer loans
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	17,627	12,885
Non-accrual Loans With No Related Allowance	650
Consumer loans | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	2,909
Consumer loans | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | Home equity
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	9,129	8,443
Non-accrual Loans With No Related Allowance	123
Consumer loans | Home equity | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	244
Consumer loans | Home equity | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | Home equity | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | 1-4 family mortgages
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	8,498	4,442
Non-accrual Loans With No Related Allowance	527
Consumer loans | 1-4 family mortgages | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	2,665
Consumer loans | 1-4 family mortgages | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | 1-4 family mortgages | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | Installment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0	$ 0
Non-accrual Loans With No Related Allowance	0
Consumer loans | Installment | Real Estate
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | Installment | Blanket Lien
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	0
Consumer loans | Installment | Equipment
Financing Receivable, Nonaccrual [Line Items]
Non-accrual	$ 0

XML

Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - Impaired Loans Individually Evaluated by Class (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	$ 48,984		$ 48,984		$ 34,244
Recorded Investment in Loans with a Specific Reserve	25,596		25,596		30,077
Unpaid Principal Balance	103,437		103,437		104,472
Specific Allowance	5,734		5,734		3,992
Interest income on non-accrual loans	110	$ 69	388	$ 148
Commercial Industrial And Agricultural | Commercial and industrial
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	4,884		4,884		12,885
Recorded Investment in Loans with a Specific Reserve	12,170		12,170		15,516
Unpaid Principal Balance	37,153		37,153		52,559
Specific Allowance	3,018		3,018		2,456
Commercial Industrial And Agricultural | Agricultural
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	4,485		4,485		1,889
Recorded Investment in Loans with a Specific Reserve	3,651		3,651		3,852
Unpaid Principal Balance	13,032		13,032		9,293
Specific Allowance	1,787		1,787		958
Commercial real estate
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	39,592		39,592		19,470
Recorded Investment in Loans with a Specific Reserve	9,775		9,775		10,709
Unpaid Principal Balance	53,229		53,229		42,620
Specific Allowance	929		929		578
Commercial real estate | Office, retail, and industrial
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	15,839		15,839		14,111
Recorded Investment in Loans with a Specific Reserve	9,326		9,326		10,709
Unpaid Principal Balance	28,730		28,730		37,007
Specific Allowance	885		885		578
Commercial real estate | Multi-family
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	1,785		1,785		1,995
Recorded Investment in Loans with a Specific Reserve	0		0		0
Unpaid Principal Balance	1,785		1,785		1,995
Specific Allowance	0		0		0
Commercial real estate | Construction
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	18,611		18,611		123
Recorded Investment in Loans with a Specific Reserve	0		0		0
Unpaid Principal Balance	18,611		18,611		123
Specific Allowance	0		0		0
Commercial real estate | Other commercial real estate
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	3,357		3,357		3,241
Recorded Investment in Loans with a Specific Reserve	449		449		0
Unpaid Principal Balance	4,103		4,103		3,495
Specific Allowance	44		44		0
Total corporate loans
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	48,961		48,961		34,244
Recorded Investment in Loans with a Specific Reserve	25,596		25,596		30,077
Unpaid Principal Balance	103,414		103,414		104,472
Specific Allowance	5,734		5,734		3,992
Consumer loans
Financing Receivable, Impaired [Line Items]
Recorded Investment in Loans with No Specific Reserve	23		23		0
Recorded Investment in Loans with a Specific Reserve	0		0		0
Unpaid Principal Balance	23		23		0
Specific Allowance	$ 0		$ 0		$ 0

XML

Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - Corporate Loans Portfolio Segment By Origination Year (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020	Dec. 31, 2019
Financing Receivable, Credit Quality Indicator [Line Items]
Revolving loans converted to term loans	$ 16,800	$ 23,800
Corporate Loan | Commercial Industrial And Agricultural
Financing Receivable, Credit Quality Indicator [Line Items]
2020	465,536	465,536
2019	899,959	899,959
2018	985,321	985,321
2017	550,918	550,918
2016	268,667	268,667
Prior	509,496	509,496
Revolving Loans	1,490,783	1,490,783
Total	5,170,680	5,170,680
Corporate Loan | Commercial Industrial And Agricultural | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	461,644	461,644
2019	887,292	887,292
2018	924,776	924,776
2017	519,875	519,875
2016	238,751	238,751
Prior	469,442	469,442
Revolving Loans	1,364,316	1,364,316
Total	4,866,096	4,866,096
Corporate Loan | Commercial Industrial And Agricultural | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	3,508	3,508
2019	6,520	6,520
2018	31,435	31,435
2017	4,676	4,676
2016	8,527	8,527
Prior	17,568	17,568
Revolving Loans	80,597	80,597
Total	152,831	152,831
Corporate Loan | Commercial Industrial And Agricultural | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	384	384
2019	4,376	4,376
2018	26,729	26,729
2017	17,862	17,862
2016	16,583	16,583
Prior	15,804	15,804
Revolving Loans	33,172	33,172
Total	114,910	114,910
Corporate Loan | Commercial Industrial And Agricultural | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	1,771	1,771
2018	2,381	2,381
2017	8,505	8,505
2016	4,806	4,806
Prior	6,682	6,682
Revolving Loans	12,698	12,698
Total	36,843	36,843
Corporate Loan | Commercial Industrial And Agricultural | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	250	250
2018	946	946
2017	1,058	1,058
2016	617	617
Prior	1,853	1,853
Revolving Loans	6,036	6,036
Total	10,760	10,760
Corporate Loan | Office, retail, and industrial
Financing Receivable, Credit Quality Indicator [Line Items]
2020	96,464	96,464
2019	267,134	267,134
2018	229,350	229,350
2017	353,549	353,549
2016	329,621	329,621
Prior	738,709	738,709
Revolving Loans	5,491	5,491
Total	2,020,318	2,020,318
Corporate Loan | Office, retail, and industrial | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	95,291	95,291
2019	266,479	266,479
2018	225,938	225,938
2017	348,121	348,121
2016	302,430	302,430
Prior	677,880	677,880
Revolving Loans	5,491	5,491
Total	1,921,630	1,921,630
Corporate Loan | Office, retail, and industrial | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	1,173	1,173
2019	655	655
2018	3,280	3,280
2017	5,091	5,091
2016	15,439	15,439
Prior	12,914	12,914
Revolving Loans	0	0
Total	38,552	38,552
Corporate Loan | Office, retail, and industrial | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	337	337
2016	1,514	1,514
Prior	22,370	22,370
Revolving Loans	0	0
Total	24,221	24,221
Corporate Loan | Office, retail, and industrial | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	132	132
2017	0	0
2016	10,238	10,238
Prior	25,545	25,545
Revolving Loans	0	0
Total	35,915	35,915
Corporate Loan | Office, retail, and industrial | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	333	333
2018	156	156
2017	0	0
2016	1,628	1,628
Prior	1,298	1,298
Revolving Loans	0	0
Total	3,415	3,415
Corporate Loan | Multi-family
Financing Receivable, Credit Quality Indicator [Line Items]
2020	125,328	125,328
2019	174,802	174,802
2018	85,178	85,178
2017	103,358	103,358
2016	102,441	102,441
Prior	247,643	247,643
Revolving Loans	36,111	36,111
Total	874,861	874,861
Corporate Loan | Multi-family | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	125,328	125,328
2019	174,802	174,802
2018	84,791	84,791
2017	101,492	101,492
2016	101,846	101,846
Prior	239,713	239,713
Revolving Loans	36,111	36,111
Total	864,083	864,083
Corporate Loan | Multi-family | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	0	0
2016	358	358
Prior	1,416	1,416
Revolving Loans	0	0
Total	1,774	1,774
Corporate Loan | Multi-family | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	387	387
2017	81	81
2016	0	0
Prior	5,415	5,415
Revolving Loans	0	0
Total	5,883	5,883
Corporate Loan | Multi-family | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	1,785	1,785
2016	237	237
Prior	1,099	1,099
Revolving Loans	0	0
Total	3,121	3,121
Corporate Loan | Multi-family | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	3	3
2018	0	0
2017	1	1
2016	0	0
Prior	10	10
Revolving Loans	0	0
Total	14	14
Corporate Loan | Construction
Financing Receivable, Credit Quality Indicator [Line Items]
2020	33,890	33,890
2019	151,849	151,849
2018	171,525	171,525
2017	104,813	104,813
2016	85,222	85,222
Prior	105,057	105,057
Revolving Loans	34,707	34,707
Total	687,063	687,063
Corporate Loan | Construction | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	33,890	33,890
2019	151,849	151,849
2018	171,480	171,480
2017	101,781	101,781
2016	71,001	71,001
Prior	70,950	70,950
Revolving Loans	33,016	33,016
Total	633,967	633,967
Corporate Loan | Construction | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	45	45
2017	3,032	3,032
2016	14,221	14,221
Prior	1,228	1,228
Revolving Loans	0	0
Total	18,526	18,526
Corporate Loan | Construction | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	0	0
2016	0	0
Prior	7,288	7,288
Revolving Loans	0	0
Total	7,288	7,288
Corporate Loan | Construction | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	0	0
2016	0	0
Prior	25,591	25,591
Revolving Loans	1,691	1,691
Total	27,282	27,282
Corporate Loan | Construction | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	118	118
2018	0	0
2017	798	798
2016	0	0
Prior	1,690	1,690
Revolving Loans	0	0
Total	2,606	2,606
Corporate Loan | Other commercial real estate
Financing Receivable, Credit Quality Indicator [Line Items]
2020	61,056	61,056
2019	199,300	199,300
2018	277,789	277,789
2017	238,501	238,501
2016	141,770	141,770
Prior	529,875	529,875
Revolving Loans	27,646	27,646
Total	1,475,937	1,475,937
Corporate Loan | Other commercial real estate | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
2020	61,056	61,056
2019	195,768	195,768
2018	269,526	269,526
2017	226,064	226,064
2016	125,249	125,249
Prior	466,436	466,436
Revolving Loans	27,553	27,553
Total	1,371,652	1,371,652
Corporate Loan | Other commercial real estate | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	3,532	3,532
2018	7,589	7,589
2017	6,887	6,887
2016	11,219	11,219
Prior	15,463	15,463
Revolving Loans	0	0
Total	44,690	44,690
Corporate Loan | Other commercial real estate | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	1,400	1,400
2016	4,224	4,224
Prior	35,599	35,599
Revolving Loans	0	0
Total	41,223	41,223
Corporate Loan | Other commercial real estate | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	674	674
2017	4,150	4,150
2016	1,078	1,078
Prior	12,377	12,377
Revolving Loans	93	93
Total	18,372	18,372
Corporate Loan | Other commercial real estate | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	38	38
2018	1	1
2017	0	0
2016	183	183
Prior	(39)	(39)
Revolving Loans	0	0
Total	183	183
Consumer loans
Financing Receivable, Credit Quality Indicator [Line Items]
Total			$ 3,271,117
Consumer loans | Home equity
Financing Receivable, Credit Quality Indicator [Line Items]
2020	8,231	8,231
2019	48,718	48,718
2018	27,908	27,908
2017	14,073	14,073
2016	12,360	12,360
Prior	63,854	63,854
Revolving Loans	717,723	717,723
Total	892,867	892,867	851,454
Consumer loans | Home equity | Performing Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	8,231	8,231
2019	48,696	48,696
2018	27,783	27,783
2017	13,809	13,809
2016	11,878	11,878
Prior	57,053	57,053
Revolving Loans	716,288	716,288
Total	883,738	883,738
Consumer loans | Home equity | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	22	22
2018	125	125
2017	264	264
2016	482	482
Prior	6,801	6,801
Revolving Loans	1,435	1,435
Total	9,129	9,129
Consumer loans | Home equity | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	1	1
2017	0	0
2016	1	1
Prior	42	42
Revolving Loans	(14)	(14)
Total	30	30
Consumer loans | 1-4 Family Mortgages
Financing Receivable, Credit Quality Indicator [Line Items]
2020	597,506	597,506
2019	676,898	676,898
2018	312,322	312,322
2017	158,313	158,313
2016	181,975	181,975
Prior	248,308	248,308
Revolving Loans	0	0
Total	2,175,322	2,175,322
Consumer loans | 1-4 Family Mortgages | Performing Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	597,506	597,506
2019	676,898	676,898
2018	311,884	311,884
2017	158,230	158,230
2016	181,912	181,912
Prior	240,394	240,394
Revolving Loans	0	0
Total	2,166,824	2,166,824
Consumer loans | 1-4 Family Mortgages | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	438	438
2017	83	83
2016	63	63
Prior	7,914	7,914
Revolving Loans	0	0
Total	8,498	8,498
Consumer loans | 1-4 Family Mortgages | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	4	4
2017	0	0
2016	7	7
Prior	735	735
Revolving Loans	0	0
Total	746	746
Consumer loans | Installment
Financing Receivable, Credit Quality Indicator [Line Items]
2020	59,971	59,971
2019	185,919	185,919
2018	107,220	107,220
2017	45,108	45,108
2016	17,563	17,563
Prior	20,662	20,662
Revolving Loans	20,764	20,764
Total	457,207	457,207	$ 492,585
Consumer loans | Installment | Performing Loans
Financing Receivable, Credit Quality Indicator [Line Items]
2020	59,971	59,971
2019	185,919	185,919
2018	107,220	107,220
2017	45,108	45,108
2016	17,563	17,563
Prior	20,662	20,662
Revolving Loans	20,764	20,764
Total	457,207	457,207
Consumer loans | Installment | Non-accrual
Financing Receivable, Credit Quality Indicator [Line Items]
2020	0	0
2019	0	0
2018	0	0
2017	0	0
2016	0	0
Prior	0	0
Revolving Loans	0	0
Total	0	0
Consumer loans | Installment | Net Loan Charge Offs
Financing Receivable, Credit Quality Indicator [Line Items]
2020	44	44
2019	3,757	3,757
2018	2,200	2,200
2017	775	775
2016	85	85
Prior	393	393
Revolving Loans	29	29
Total	$ 7,283	$ 7,283

XML

Past Due Loans, Allowance For Credit Losses, Impaired Loans, and TDRS - Credit Quality Indicators by Class (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Commercial Industrial And Agricultural | Commercial and industrial
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		$ 4,481,525
Commercial Industrial And Agricultural | Commercial and industrial | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		4,324,709
Commercial Industrial And Agricultural | Commercial and industrial | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		47,665
Commercial Industrial And Agricultural | Commercial and industrial | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		79,156
Commercial Industrial And Agricultural | Commercial and industrial | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		29,995
Commercial Industrial And Agricultural | Agricultural
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		405,616
Commercial Industrial And Agricultural | Agricultural | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		350,827
Commercial Industrial And Agricultural | Agricultural | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		32,764
Commercial Industrial And Agricultural | Agricultural | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		16,071
Commercial Industrial And Agricultural | Agricultural | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		5,954
Commercial Real Estate
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		4,682,072
Commercial Real Estate | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		4,446,552
Commercial Real Estate | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		108,274
Commercial Real Estate | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		93,811
Commercial Real Estate | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		33,435
Commercial Real Estate | Office, retail, and industrial
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		1,848,718
Commercial Real Estate | Office, retail, and industrial | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		1,747,287
Commercial Real Estate | Office, retail, and industrial | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		42,230
Commercial Real Estate | Office, retail, and industrial | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		33,344
Commercial Real Estate | Office, retail, and industrial | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		25,857
Commercial Real Estate | Multi-family
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		856,553
Commercial Real Estate | Multi-family | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		839,615
Commercial Real Estate | Multi-family | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		8,279
Commercial Real Estate | Multi-family | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		5,962
Commercial Real Estate | Multi-family | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		2,697
Commercial Real Estate | Construction
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		593,093
Commercial Real Estate | Construction | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		564,495
Commercial Real Estate | Construction | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		17,977
Commercial Real Estate | Construction | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		10,469
Commercial Real Estate | Construction | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		152
Commercial Real Estate | Other commercial real estate
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		1,383,708
Commercial Real Estate | Other commercial real estate | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		1,295,155
Commercial Real Estate | Other commercial real estate | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		39,788
Commercial Real Estate | Other commercial real estate | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		44,036
Commercial Real Estate | Other commercial real estate | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		4,729
Total corporate loans
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		9,569,213
Total corporate loans | Pass
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		9,122,088
Total corporate loans | Special Mention
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		188,703
Total corporate loans | Substandard
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		189,038
Total corporate loans | Non-accrual
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		69,384
Consumer loans
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		3,271,117
Consumer loans | Performing
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		3,258,232
Consumer loans | Nonperforming
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		12,885
Consumer loans | Home equity
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable	$ 892,867	851,454
Consumer loans | Home equity | Performing
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		843,011
Consumer loans | Home equity | Nonperforming
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		8,443
Consumer loans | 1-4 family mortgages
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		1,927,078
Consumer loans | 1-4 family mortgages | Performing
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		1,922,636
Consumer loans | 1-4 family mortgages | Nonperforming
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		4,442
Consumer loans | Installment
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable	$ 457,207	492,585
Consumer loans | Installment | Performing
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		492,585
Consumer loans | Installment | Nonperforming
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - Credit Quality Indicators by Class, Excluding Covered Loans (Continued) [Line Items]
Financing receivable		$ 0

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Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - TDRs By Class (Details) - USD ($) $ in Thousands		6 Months Ended	12 Months Ended
		Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		$ 1,201	$ 1,233
Non-accrual	[1]	12,093	20,514
Total		13,294	21,747	$ 9,282
Specific reserves related to TDRs		2,400	2,200
Commercial Industrial And Agricultural | Commercial and industrial
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		188	227
Non-accrual	[1]	9,336	16,420
Total		9,524	16,647
Commercial Industrial And Agricultural | Agricultural
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		0	0
Non-accrual	[1]	0	0
Total		0	0
Commercial real estate
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		358	333
Non-accrual	[1]	2,340	3,600
Total		2,698	3,933
Commercial real estate | Office, retail, and industrial
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		0	0
Non-accrual	[1]	2,340	3,600
Total		2,340	3,600
Commercial real estate | Multi-family
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		160	163
Non-accrual	[1]	0	0
Total		160	163
Commercial real estate | Construction
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		0	0
Non-accrual	[1]	0	0
Total		0	0
Commercial real estate | Other commercial real estate
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		198	170
Non-accrual	[1]	0	0
Total		198	170
Total corporate loans
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		546	560
Non-accrual	[1]	11,676	20,020
Total		12,222	20,580
Consumer loans
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		655	673
Non-accrual	[1]	417	494
Total		1,072	1,167
Consumer loans | Home equity
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		31	36
Non-accrual	[1]	179	240
Total		210	276
Consumer loans | 1-4 family mortgages
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		624	637
Non-accrual	[1]	238	0
Total		862	637
Consumer loans | Installment
Past Due Loans, Allowance For Credit Losses, and Impaired Loans (Details) - TDRs By Class [Line Items]
Accruing TDRs		0	0
Non-accrual	[1]	0	254
Total		$ 0	$ 254

[1] These TDRs are included in non-accrual loans in the preceding tables.

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Past Due Loans, Allowance For Credit Losses, Non-Accrual Loans, and TDRS - TDR Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Troubled Debt Restructuring Activity Rollforward [Roll Forward]
Beginning balance			$ 21,747
Ending balance	$ 13,294	$ 9,282	13,294	$ 9,282
Material commitments to lend additional funds to borrowers with TDRs	813		813		$ 530
Accruing
Troubled Debt Restructuring Activity Rollforward [Roll Forward]
Beginning balance	1,216	1,844	1,233	1,866
Additions	0	0	0	12
Net payments	(15)	(20)	(32)	(54)
Net transfers to non-accrual	0	(383)	0	(383)
Ending balance	1,201	1,441	1,201	1,441
Non-accrual
Troubled Debt Restructuring Activity Rollforward [Roll Forward]
Beginning balance	17,917	9,375	20,514	6,612
Additions	0	0	934	0
Net payments	(2,595)	(1,447)	(3,253)	1,474
Charge-offs	(3,229)	(470)	(6,102)	(628)
Net transfers from accruing	0	383	0	383
Ending balance	$ 12,093	$ 7,841	$ 12,093	$ 7,841

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Lease Obligations - Narrative (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018 USD ($)		Dec. 31, 2016 USD ($) branch	Jun. 30, 2020 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)		Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)
Leases [Abstract]
Operating lease, weighted average remaining lease term				10 years 8 months 12 days
Operating lease, weighted average discount rate (as a percent)				2.96%
Operating lease, right-of-use asset				$ 141,200
Lessee, Lease, Description [Line Items]
Sale and leaseback transaction, number of branches sold | branch			55
Sale and leaseback transaction, pre-tax gain	$ 65,500		$ 88,000
Sale and leaseback transaction related expenses			$ 5,500
Cumulative effect adjustment	2,054,998			2,656,211	$ 2,435,707	$ 2,370,793		$ 2,300,573	$ 2,159,471
Cumulative Effect, Period Of Adoption, Adjustment
Lessee, Lease, Description [Line Items]
Cumulative effect adjustment	47,257	[1]				(26,821)	[2]
Retained Earnings
Lessee, Lease, Description [Line Items]
Cumulative effect adjustment	1,192,767			$ 1,359,407	$ 1,357,395	1,380,612		$ 1,304,756	$ 1,273,245
Retained Earnings | Cumulative Effect, Period Of Adoption, Adjustment
Lessee, Lease, Description [Line Items]
Cumulative effect adjustment	$ 47,257	[1]				$ (26,821)	[2]

[1] As a result of accounting guidance adopted in the first quarter of 2019, the remaining deferred gain on a sale-leaseback transaction was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2019.

[2] As a result of accounting guidance adopted in the first quarter of 2020, a portion of the increase in allowance for credit losses, net of tax, was recognized as a cumulative-effect adjustment to retained earnings as of January 1, 2020. For further discussion of this guidance, see Note 2, "Recent Accounting Pronouncements and Other Guidance."

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Lease Obligations - Schedule of Lease Liability (Details) $ in Thousands	Jun. 30, 2020 USD ($)
Leases [Abstract]
2020	$ 9,466
2021	18,785
2022	18,711
2023	18,811
2024	18,530
2025 and thereafter	105,995
Total minimum lease payments	190,298
Discount	(28,752)	[1]
Lease liability	$ 161,546	[2]

[1] Represents the net present value adjustment related to minimum lease payments.

[2] Included in accrued interest payable and other liabilities in the Consolidated Statements of Financial Condition.

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Lease Obligations - Schedule of Net Operating Lease Expense (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Leases [Abstract]
Lease expense charged to operations		$ 4,839	$ 4,426	$ 9,514	$ 8,486
Rental income from premises leased to others	[1]	(183)	(165)	(398)	(322)
Net operating lease expense		$ 4,656	$ 4,261	$ 9,116	$ 8,164

[1] Included as reductions to net occupancy and equipment expense in the Condensed Consolidated Statements of Income.

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Borrowed Funds - Summary of Borrowed Funds (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Debt Disclosure [Abstract]
Securities sold under agreements to repurchase	$ 130,667	$ 103,515
Federal funds purchased	200,000	160,000
FHLB advances	1,974,528	1,395,243
Total borrowed funds	$ 2,305,195	$ 1,658,758

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Borrowed Funds - Narrative (Details) - USD ($)	Sep. 27, 2016	Jun. 30, 2020
Short-term Debt [Line Items]
Line of credit maximum borrowing capacity	$ 50,000,000.0
Commitment fee (as a percent)	0.35%
Amount outstanding under facility		$ 0
One-month LIBOR plus 1.75%
Short-term Debt [Line Items]
Line of credit interest rate spread (as a percent)	1.75%
Federal Home Loan Bank Advances | Minimum
Short-term Debt [Line Items]
FHLB fixed interest rate (as a percent)		0.00%
Federal Home Loan Bank Advances | Maximum
Short-term Debt [Line Items]
FHLB fixed interest rate (as a percent)		1.97%

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Borrowed Funds - Short-Term Credit Lines Available for Use (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
FRB's Discount Window Primary Credit Program
Line of Credit Facility [Line Items]
Credit lines available for use	$ 803,068	$ 874,256
Available federal funds lines
Line of Credit Facility [Line Items]
Credit lines available for use	814,000	718,000
Correspondent bank line of credit
Line of Credit Facility [Line Items]
Credit lines available for use	$ 50,000	$ 50,000

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Material Transactions Affecting Stockholders' Equity (Details) - USD ($)		3 Months Ended	6 Months Ended
	Mar. 09, 2020	Jun. 30, 2020	Jun. 30, 2020	Jun. 30, 2019	Mar. 19, 2020	Feb. 26, 2020	Feb. 25, 2020
Class of Stock [Line Items]
Preferred stock, shares issued (in shares)		231,000	231,000
Preferred stock issued		$ 221,312,000	$ 221,312,000
Net proceeds from the issuance of preferred stock		$ 221,300,000	$ 221,312,000	$ 0
Stock repurchase program, authorized amount					$ 180,000,000	$ 200,000,000	$ 180,000,000
Common stock repurchased (in shares)		1,200,000
Total cost of common stock repurchased		$ 22,600,000
Depository Series A Shares
Class of Stock [Line Items]
Preferred stock, shares issued (in shares)		4,300,000	4,300,000
Preferred stock, conversion rate (as a percent)		2.50%
Preferred stock, fixed rate (as a percent)		7.00%
Depository Series C Shares
Class of Stock [Line Items]
Preferred stock, shares issued (in shares)		4,900,000	4,900,000
Preferred stock, conversion rate (as a percent)		2.50%
Depository Shares
Class of Stock [Line Items]
Preferred stock issued		$ 230,500,000
Bankmanagers Corporation
Class of Stock [Line Items]
Acquisitions, net of issuance costs (in shares)	4,930,231
Shares issued (in dollars per share)	$ 14.58

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Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Earnings Per Share [Abstract]
Net income	$ 19,064	$ 47,014	$ 38,670	$ 93,072
Preferred dividends	(1,037)	0	(1,037)	0
Net income applicable to unvested restricted shares	(187)	(389)	(379)	(792)
Net income applicable to common shares	$ 17,840	$ 46,625	$ 37,254	$ 92,280
Weighted-average common shares outstanding:
Weighted-average common shares outstanding (basic) (in Shares)	113,145	108,467	111,533	107,126
Dilutive effect of common stock equivalents (in Shares)	191	0	339	0
Weighted-average diluted common shares outstanding (in Shares)	113,336	108,467	111,872	107,126
Basic EPS (in dollars per share)	$ 0.16	$ 0.43	$ 0.33	$ 0.86
Diluted EPS (in dollars per share)	$ 0.16	$ 0.43	$ 0.33	$ 0.86

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Derivative Instruments and Hedging Activities - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Apr. 20, 2020	Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Amount of variable rate loans hedged using interest rate swaps	$ 430,000		$ 430,000
Amount hedged of borrowed funds using forward starting interest rate swaps	1,600,000		1,600,000		$ 1,100,000
Amount to be hedged of borrowed funds using forward starting interest rate swaps	$ 485,000		$ 485,000
Weighted-average interest rate to be paid (as a percent)	1.86%		1.86%
Interest rate cash flow hedge loss to be reclassified during next 12 months, net	$ 4,300		$ 4,300
Capital market products income	$ 694	$ 2,154	$ 5,416	$ 3,433
Portion of fair value of outstanding interest rate swaps covered by collateral agreements (percent)	100.00%		100.00%			100.00%

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Derivative Instruments and Hedging Activities - Cash Flow Hedges (Details) - Cash Flow Hedging - USD ($) $ in Thousands		3 Months Ended	6 Months Ended
		Mar. 31, 2020	Jun. 30, 2020	Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gross notional amount outstanding			$ 2,035,000	$ 1,905,000
Derivative asset fair value in other assets	[1]		6,053	727
Derivative liability fair value in other liabilities	[1]		$ 198	$ 119
Weighted-average interest rate received			0.96%	1.88%
Weighted-average interest rate paid			0.77%	1.74%
Weighted-average maturity (in years)		1 year 2 months 4 days	2 years 3 months 18 days

[1] Certain cash flow hedges are transacted through a clearinghouse ("centrally cleared") and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

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Derivative Instruments and Hedging Activities - Other Derivative Instruments (Details) - Other Derivative Instruments - USD ($) $ in Thousands		Jun. 30, 2020	Dec. 31, 2019
Derivative [Line Items]
Gross notional amount outstanding		$ 4,589,018	$ 4,340,384
Derivative asset fair value in other assets	[1]	183,938	61,709
Derivative liability fair value in other liabilities	[1]	(55,026)	(18,416)
Fair value of derivative	[2]	$ 56,025	$ 18,856

[1] Certain other derivative instruments are centrally cleared and their change in fair value is settled by the counterparties to the transaction, which results in no fair value.

[2] This amount represents the fair value if credit risk related contingent features were triggered.

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Derivative Instruments and Hedging Activities - Cash Flow Hedge Accounting on AOCI (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gains (losses) recognized in other comprehensive income	$ (7,300)	$ 2,441	$ (17,340)	$ 3,899
Interest Income | Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gains (losses) recognized in other comprehensive income	5,951	5,944	27,955	9,297
Reclassification of gains (losses) included in net income	2,624	1,355	3,069	2,748
Interest Expense | Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gains (losses) recognized in other comprehensive income	(1,276)	(7,816)	(13,685)	(11,996)
Reclassification of gains (losses) included in net income	$ 0	$ (1,924)	$ 0	$ (3,948)

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Derivative Instruments and Hedging Activities - Effect Of Derivatives On Interest Income (Details) - Designated as Hedging Instrument - Cash Flow Hedging - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gain (loss) on derivative, net	$ 2,624	$ (569)	$ 3,069	$ (1,200)
Interest Income
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gain (loss) on derivative, net	2,624	1,355	3,069	2,748
Interest Expense
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Gain (loss) on derivative, net	$ 0	$ (1,924)	$ 0	$ (3,948)

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Derivative Instruments and Hedging Activities - Offsetting Derivatives (Details) - USD ($) $ in Thousands		Jun. 30, 2020	Dec. 31, 2019
Assets
Gross amounts recognized		$ 189,991	$ 62,436
Less: amounts offset in the Consolidated Statements of Financial Condition		0	0
Net amount presented in the Consolidated Statements of Financial Condition	[1]	189,991	62,436
Offsetting derivative positions		(7,495)	(2,674)
Cash collateral pledged		0	0
Net credit exposure		182,496	59,762
Liabilities
Gross amounts recognized		54,828	18,535
Less: amounts offset in the Consolidated Statements of Financial Condition		0	0
Net amount presented in the Consolidated Statements of Financial Condition	[1]	54,828	18,535
Offsetting derivative positions		(7,495)	(2,674)
Cash collateral pledged		(48,430)	(15,861)
Net credit exposure		$ (1,097)	$ 0

[1] Included in other assets or other liabilities in the Consolidated Statements of Financial Condition.

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Commitments, Guarantees, and Contingent Liabilities (Details) - USD ($) $ in Thousands		Jun. 30, 2020	Dec. 31, 2019
Other Commitments [Line Items]
Letters of credit		$ 100,827	$ 103,684
Commitments to extend credit
Other Commitments [Line Items]
Commercial, industrial, and agricultural		2,276,196	1,852,040
Commercial real estate		324,659	296,053
Home equity		578,920	576,956
Other commitments	[1]	251,716	251,093
Total commitments to extend credit		$ 3,431,491	$ 2,976,142

[1] Other commitments includes installment and overdraft protection program commitments.

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Fair Value - Recurring Fair Value Measurements (Details) - USD ($) $ in Thousands		Jun. 30, 2020		Mar. 31, 2020	Dec. 31, 2019	Jun. 30, 2019	[1]	Mar. 31, 2019	Dec. 31, 2018
Assets
Equity securities		$ 43,954			$ 42,136
Securities Available-for-Sale
Securities available-for-sale, at fair value		3,435,862			2,873,386
Mortgage servicing rights (MSRs)		4,464	[1]	$ 4,874	5,858	$ 5,831		$ 6,228	$ 6,730
U.S. treasury securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		21,199			34,075
U.S. agency securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		643,047			248,424
CMOs
Securities Available-for-Sale
Securities available-for-sale, at fair value		1,672,129			1,557,671
MBSs
Securities Available-for-Sale
Securities available-for-sale, at fair value		715,140			684,684
Municipal securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		239,803			234,431
Corporate debt securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		144,544			114,101
Recurring | Level 1
Assets
Equity securities		24,075			23,703
Securities Available-for-Sale
Securities available-for-sale, at fair value		21,199			34,075
Mortgage servicing rights (MSRs)	[2]	0			0
Derivative assets	[2]	0			0
Liabilities
Derivative liabilities	[3]	0			0
Recurring | Level 1 | U.S. treasury securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		21,199			34,075
Recurring | Level 1 | U.S. agency securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 1 | CMOs
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 1 | MBSs
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 1 | Municipal securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 1 | Corporate debt securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 2
Assets
Equity securities		14,879			13,400
Securities Available-for-Sale
Securities available-for-sale, at fair value		3,414,663			2,839,311
Mortgage servicing rights (MSRs)	[2]	0			0
Derivative assets	[2]	189,991			62,436
Liabilities
Derivative liabilities	[3]	54,828			18,535
Recurring | Level 2 | U.S. treasury securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 2 | U.S. agency securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		643,047			248,424
Recurring | Level 2 | CMOs
Securities Available-for-Sale
Securities available-for-sale, at fair value		1,672,129			1,557,671
Recurring | Level 2 | MBSs
Securities Available-for-Sale
Securities available-for-sale, at fair value		715,140			684,684
Recurring | Level 2 | Municipal securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		239,803			234,431
Recurring | Level 2 | Corporate debt securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		144,544			114,101
Recurring | Level 3
Assets
Equity securities		0			0
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Mortgage servicing rights (MSRs)	[2]	4,464			5,858
Derivative assets	[2]	0			0
Liabilities
Derivative liabilities	[3]	0			0
Recurring | Level 3 | U.S. treasury securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 3 | U.S. agency securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 3 | CMOs
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 3 | MBSs
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 3 | Municipal securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		0			0
Recurring | Level 3 | Corporate debt securities
Securities Available-for-Sale
Securities available-for-sale, at fair value		$ 0			$ 0

[1] Included in other assets in the Consolidated Statements of Financial Condition.

[2] Included in other assets in the Consolidated Statements of Financial Condition.

[3] Included in other liabilities in the Consolidated Statements of Financial Condition.

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Fair Value - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Fair Value (Details) [Line Items]
Equity securities, at fair value	$ 43,954	$ 42,136
Total amount of loans being serviced for the benefit of others at the end of the period	$ 675,600	653,700
Minimum
Fair Value (Details) [Line Items]
Appraisal adjustment (percent)	0.00%
Maximum
Fair Value (Details) [Line Items]
Appraisal adjustment (percent)	15.00%
Recurring | Level 2
Fair Value (Details) [Line Items]
Equity securities, at fair value	$ 14,879	$ 13,400
Community Development Investments | Recurring | Level 2
Fair Value (Details) [Line Items]
Equity securities, at fair value	$ 5,000

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Fair Value - Significant Unobservable Inputs Used In the Valuation of MSRs (Details)	6 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Minimum
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Prepayment speed	7.60%	6.70%
Maturity (months)	16 months	18 months
Discount rate	9.40%	9.30%
Maximum
Assumption for Fair Value as of Balance Sheet Date of Assets or Liabilities that relate to Transferor's Continuing Involvement [Line Items]
Prepayment speed	14.90%	12.00%
Maturity (months)	88 months	94 months
Discount rate	12.00%	12.00%

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Fair Value - Carrying Value of Mortgage Servicing Rights (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Servicing Asset at Fair Value, Amount [Roll Forward]
Beginning balance		$ 4,874	$ 6,228	$ 5,858	$ 6,730
New MSRs		745	204	901	457
Total gains (losses) included in earnings:
Changes in valuation inputs and assumptions	[1]	(750)	(389)	(1,658)	(989)
Other changes in fair value	[1],[2]	(405)	(212)	(637)	(367)
Ending balance	[3]	4,464	5,831	4,464	5,831
Contractually servicing fees earned	[1]	$ 394	$ 390	$ 797	$ 771

[1] Included in mortgage banking income in the Condensed Consolidated Statements of Income and related to assets held as of June 30, 2020 and 2019.

[2] Primarily represents changes in expected future cash flows due to payoffs and paydowns.

[3] Included in other assets in the Consolidated Statements of Financial Condition.

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Fair Value - Assets Measured At Fair Value On A Non-Recurring Basis (Details) - USD ($) $ in Thousands		Jun. 30, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
OREO		$ 9,947	$ 8,750
Nonrecurring | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Collateral-dependent impaired loans	[1]	0	0
OREO	[2]	0	0
Loans held-for-sale	[3]	0	0
Assets held-for-sale	[4]	0	0
Nonrecurring | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Collateral-dependent impaired loans	[1]	0	0
OREO	[2]	0	0
Loans held-for-sale	[3]	0	0
Assets held-for-sale	[4]	0	0
Nonrecurring | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Collateral-dependent impaired loans	[1]	53,608	41,326
OREO	[2]	530	3,325
Loans held-for-sale	[3]	45,466	36,032
Assets held-for-sale	[4]	$ 5,180	$ 6,824

[1] Includes non-accrual loans with charge-offs and non-accrual loans with a specific allowance during the periods presented.

[2] Includes OREO with fair value adjustments subsequent to initial transfer that occurred during the periods presented.

[3] Included in other assets in the Consolidated Statements of Financial Condition.

[4] Included in premises, furniture, and equipment in the Consolidated Statements of Financial Condition.

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Fair Value - Fair Value Measurements of Other Financial Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Assets
Cash and due from banks	$ 304,445	$ 214,894
Interest-bearing deposits in other banks	637,856	84,327
Securities held-to-maturity	19,628
FHLB and FRB stock	148,512	115,409
Loans	14,693,606	12,732,308
Investment in BOLI	299,649	296,351
Liabilities
Deposits	15,657,656	13,251,278
Borrowed funds	2,305,195	1,658,758
Senior and subordinated debt	234,358	233,948
Carrying Amount | Level 1
Assets
Cash and due from banks	304,445	214,894
Carrying Amount | Level 2
Assets
Interest-bearing deposits in other banks	637,856	84,327
Securities held-to-maturity	19,628	21,997
FHLB and FRB stock	148,512	115,409
Liabilities
Deposits	15,657,656	13,251,278
Borrowed funds	2,305,195	1,658,758
Senior and subordinated debt	234,358	233,948
Accrued interest payable	7,633	10,502
Carrying Amount | Level 3
Assets
Loans	14,693,606	12,733,200
Investment in BOLI	299,649	296,351
Accrued interest receivable	63,162	59,716
Fair Value | Level 1
Assets
Cash and due from banks	304,445	214,894
Fair Value | Level 2
Assets
Interest-bearing deposits in other banks	637,856	84,327
Securities held-to-maturity	19,676	21,234
FHLB and FRB stock	148,512	115,409
Liabilities
Deposits	15,667,051	13,247,871
Borrowed funds	2,305,195	1,658,758
Senior and subordinated debt	266,003	277,203
Accrued interest payable	7,633	10,502
Fair Value | Level 3
Assets
Loans	14,739,129	12,535,848
Investment in BOLI	299,649	296,351
Accrued interest receivable	$ 63,162	$ 59,716