| Allowance for Credit Losses |
Allowance for Credit Losses
The allowance for credit losses consists of the allowance for losses on non-covered loans and allowance for losses on covered loans related to credit impairment of certain covered loan pools subsequent to acquisition, as well as the allowance for unfunded letters of credit. Management maintains the allowance for credit losses at a level estimated to absorb probable loan losses of the loan portfolio and unfunded letter of credit commitments at the balance sheet date. The allowance for losses on non-covered loans is based on ongoing evaluations of the probable estimated losses inherent in the non-covered loan portfolio, including unexpected credit impairment or reduction in the provision of non-covered PCI loan pools subsequent to the acquisition date.
The following table summarizes the allowance for credit losses at September 30, 2015 and December 31, 2014: | | | | | | | | | | September 30,
2015 | | December 31,
2014 | | (in thousands) | Components of allowance for credit losses: | | | | Allowance for non-covered loans | $ | 104,351 |
| | $ | 102,153 |
| Allowance for covered loans | 200 |
| | 200 |
| Total allowance for loan losses | 104,551 |
| | 102,353 |
| Allowance for unfunded letters of credit | 2,146 |
| | 1,934 |
| Total allowance for credit losses | $ | 106,697 |
| | $ | 104,287 |
|
The following table summarizes the provision for credit losses for the periods indicated: | | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | | 2015 | | 2014 | | 2015 | | 2014 | | (in thousands) | Components of provision for credit losses: | | | | | | | | Provision for non-covered loans | $ | — |
| | $ | — |
| | $ | 4,382 |
| | $ | 4,949 |
| Provision for covered loans | — |
| | — |
| | — |
| | (5,671 | ) | Total provision for loan losses | — |
| | — |
| | 4,382 |
| | (722 | ) | Provision for unfunded letters of credit | 94 |
| | (423 | ) | | 212 |
| | (1,374 | ) | Total provision for credit losses | $ | 94 |
| | $ | (423 | ) | | $ | 4,594 |
| | $ | (2,096 | ) |
The following table details activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2015 and 2014: | | | | | | | | | | | | | | | | | | | | | | | | | | Commercial and Industrial | | Commercial Real Estate | | Residential Mortgage | | Consumer | | Unallocated | | Total | | (in thousands) | Three Months Ended
September 30, 2015: | | | | | | | | | | | | Allowance for loan losses: | | | | | | | | | | | | Beginning balance | $ | 41,714 |
| | $ | 44,185 |
| | $ | 5,055 |
| | $ | 5,542 |
| | $ | 6,339 |
| | $ | 102,835 |
| Loans charged-off | (1,124 | ) | | (40 | ) | | (111 | ) | | (734 | ) | | — |
| | (2,009 | ) | Charged-off loans recovered | 2,550 |
| | 536 |
| | 151 |
| | 488 |
| | — |
| | 3,725 |
| Net recoveries (charge-offs) | 1,426 |
| | 496 |
| | 40 |
| | (246 | ) | | — |
| | 1,716 |
| Provision for loan losses | 4,397 |
| | (2,403 | ) | | (546 | ) | | (829 | ) | | (619 | ) | | — |
| Ending balance | $ | 47,537 |
| | $ | 42,278 |
| | $ | 4,549 |
| | $ | 4,467 |
| | $ | 5,720 |
| | $ | 104,551 |
| Three Months Ended
September 30, 2014: | | | | | | | | | | | | Allowance for loan losses: | | | | | | | | | | | | Beginning balance | $ | 48,421 |
| | $ | 35,267 |
| | $ | 7,018 |
| | $ | 5,368 |
| | $ | 6,979 |
| | $ | 103,053 |
| Loans charged-off (1) | (1,852 | ) | | (181 | ) | | (240 | ) | | (72 | ) | | — |
| | (2,345 | ) | Charged-off loans recovered | 1,190 |
| | 26 |
| | 8 |
| | 506 |
| | — |
| | 1,730 |
| Net (charge-offs) recoveries | (662 | ) | | (155 | ) | | (232 | ) | | 434 |
| | — |
| | (615 | ) | Provision for loan losses | (1,388 | ) | | 1,954 |
| | (610 | ) | | (22 | ) | | 66 |
| | — |
| Ending balance | $ | 46,371 |
| | $ | 37,066 |
| | $ | 6,176 |
| | $ | 5,780 |
| | $ | 7,045 |
| | $ | 102,438 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | Commercial and Industrial | | Commercial Real Estate | | Residential Mortgage | | Consumer | | Unallocated | | Total | | (in thousands) | Nine Months Ended
September 30, 2015: | | | | | | | | | | | | Allowance for loan losses: | | | | | | | | | | | | Beginning balance | $ | 43,676 |
| | $ | 42,840 |
| | $ | 5,093 |
| | $ | 5,179 |
| | $ | 5,565 |
| | $ | 102,353 |
| Loans charged-off | (5,103 | ) | | (2,780 | ) | | (499 | ) | | (2,642 | ) | | — |
| | (11,024 | ) | Charged-off loans recovered | 5,587 |
| | 1,686 |
| | 395 |
| | 1,172 |
| | — |
| | 8,840 |
| Net recoveries (charge-offs) | 484 |
| | (1,094 | ) | | (104 | ) | | (1,470 | ) | | — |
| | (2,184 | ) | Provision for loan losses | 3,377 |
| | 532 |
| | (440 | ) | | 758 |
| | 155 |
| | 4,382 |
| Ending balance | $ | 47,537 |
| | $ | 42,278 |
| | $ | 4,549 |
| | $ | 4,467 |
| | $ | 5,720 |
| | $ | 104,551 |
| Nine Months Ended
September 30, 2014: | | | | | | | | | | | | Allowance for loan losses: | | | | | | | | | | | | Beginning balance | $ | 51,551 |
| | $ | 42,343 |
| | $ | 7,786 |
| | $ | 4,359 |
| | $ | 7,578 |
| | $ | 113,617 |
| Loans charged-off (1) | (11,806 | ) | | (6,703 | ) | | (515 | ) | | (2,311 | ) | | — |
| | (21,335 | ) | Charged-off loans recovered (2) | 6,154 |
| | 2,831 |
| | 244 |
| | 1,649 |
| | — |
| | 10,878 |
| Net charge-offs | (5,652 | ) | | (3,872 | ) | | (271 | ) | | (662 | ) | | — |
| | (10,457 | ) | Provision for loan losses | 472 |
| | (1,405 | ) | | (1,339 | ) | | 2,083 |
| | (533 | ) | | (722 | ) | Ending balance | $ | 46,371 |
| | $ | 37,066 |
| | $ | 6,176 |
| | $ | 5,780 |
|
| $ | 7,045 |
| | $ | 102,438 |
|
| | (1) | Includes covered loans charge-offs totaling $433 thousand and $1.2 million for three and nine months ended September 30, 2014, respectively. There were no covered loan charge-offs during 2015. |
| | (2) | Included covered loans recoveries totaling $462 thousand for nine months ended September 30, 2014. There were no covered loan recoveries for the third quarters of 2014 and 2015, and the nine months ended September 30, 2015. |
The following table represents the allocation of the allowance for loan losses and the related loans by loan portfolio segment disaggregated based on the impairment methodology at September 30, 2015 and December 31, 2014. | | | | | | | | | | | | | | | | | | | | | | | | | | Commercial and Industrial | | Commercial Real Estate | | Residential Mortgage | | Consumer | | Unallocated | | Total | | (in thousands) | September 30, 2015 | | | | | | | | | | | | Allowance for loan losses: | | | | | | | | | | | | Individually evaluated for impairment | $ | 4,446 |
| | $ | 4,536 |
| | $ | 1,632 |
| | $ | 463 |
| | $ | — |
| | $ | 11,077 |
| Collectively evaluated for impairment | 42,921 |
| | 37,742 |
| | 2,917 |
| | 3,974 |
| | 5,720 |
| | 93,274 |
| Loans acquired with discounts related to credit quality | 170 |
| | — |
| | — |
| | 30 |
| | — |
| | 200 |
| Total | $ | 47,537 |
| | $ | 42,278 |
| | $ | 4,549 |
| | $ | 4,467 |
| | $ | 5,720 |
| | $ | 104,551 |
| Loans: | | | | | | | | | | | | Individually evaluated for impairment | $ | 27,384 |
| | $ | 89,434 |
| | $ | 23,424 |
| | $ | 3,097 |
| | $ | — |
| | $ | 143,339 |
| Collectively evaluated for impairment | 2,125,254 |
| | 6,441,869 |
| | 2,839,978 |
| | 1,988,586 |
| | — |
| | 13,395,687 |
| Loans acquired with discounts related to credit quality | 247,980 |
| | 999,027 |
| | 135,860 |
| | 94,921 |
| | — |
| | 1,477,788 |
| Total | $ | 2,400,618 |
| | $ | 7,530,330 |
| | $ | 2,999,262 |
| | $ | 2,086,604 |
| | $ | — |
| | $ | 15,016,814 |
| December 31, 2014 | | | | | | | | | | | | Allowance for loan losses: | | | | | | | | | | | | Individually evaluated for impairment | $ | 4,929 |
| | $ | 5,502 |
| | $ | 1,629 |
| | $ | 465 |
| | $ | — |
| | $ | 12,525 |
| Collectively evaluated for impairment | 38,577 |
| | 37,338 |
| | 3,434 |
| | 4,714 |
| | 5,565 |
| | 89,628 |
| Loans acquired with discounts related to credit quality | 170 |
| | — |
| | 30 |
| | — |
| | — |
| | 200 |
| Total | $ | 43,676 |
| | $ | 42,840 |
| | $ | 5,093 |
| | $ | 5,179 |
| | $ | 5,565 |
| | $ | 102,353 |
| Loans: | | | | | | | | | | | | Individually evaluated for impairment | $ | 28,224 |
| | $ | 91,298 |
| | $ | 22,340 |
| | $ | 3,146 |
| | $ | — |
| | $ | 145,008 |
| Collectively evaluated for impairment | 1,931,703 |
| | 5,438,538 |
| | 2,396,704 |
| | 1,840,159 |
| | — |
| | 11,607,104 |
| Loans acquired with discounts related to credit quality | 291,184 |
| | 1,164,179 |
| | 157,328 |
| | 109,110 |
| | — |
| | 1,721,801 |
| Total | $ | 2,251,111 |
| | $ | 6,694,015 |
| | $ | 2,576,372 |
| | $ | 1,952,415 |
| | $ | — |
| | $ | 13,473,913 |
|
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