XML 26 R16.htm IDEA: XBRL DOCUMENT v3.19.2
Allowance for Credit Losses
 6 Months Ended
Jun. 30, 2019
Receivables [Abstract]  
Allowance for Credit Losses Allowance for Credit Losses

The allowance for credit losses consists of the allowance for loan losses and 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 loan losses is based on ongoing evaluations of the probable estimated losses inherent in the loan portfolio, including unexpected additional credit impairment of PCI loan pools subsequent to acquisition. There was no allowance allocation for PCI loan losses at June 30, 2019 and December 31, 2018.
The following table summarizes the allowance for credit losses at June 30, 2019 and December 31, 2018: 
 
June 30,
2019
 
December 31,
2018
 
(in thousands)
Components of allowance for credit losses:
 
 
 
Allowance for loan losses
$
155,105

 
$
151,859

Allowance for unfunded letters of credit
2,974

 
4,436

Total allowance for credit losses
$
158,079

 
$
156,295


The following table summarizes the provision for credit losses for the periods indicated:
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2019
 
2018
 
2019
 
2018
 
(in thousands)
Components of provision for credit losses:
 
 
 
 
 
 
 
Provision for loan losses
$
3,706

 
$
6,592

 
$
11,562

 
$
17,294

Provision for unfunded letters of credit
(1,606
)
 
550

 
(1,462
)
 
796

Total provision for credit losses
$
2,100

 
$
7,142

 
$
10,100

 
$
18,090



The following tables detail activity in the allowance for loan losses by portfolio segment for the three and six months ended June 30, 2019 and 2018:
 
Commercial
and Industrial
 
Commercial
Real Estate
 
Residential
Mortgage
 
Consumer
 
Total
 
(in thousands)
Three Months Ended
June 30, 2019
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
Beginning balance
$
94,630

 
$
47,762

 
$
5,139

 
$
6,850

 
$
154,381

Loans charged-off
(3,073
)
 
—

 
—

 
(1,752
)
 
(4,825
)
Charged-off loans recovered
1,195

 
22

 
9

 
617

 
1,843

Net (charge-offs) recoveries
(1,878
)
 
22

 
9

 
(1,135
)
 
(2,982
)
Provision for loan losses
1,632

 
1,194

 
71

 
809

 
3,706

Ending balance
$
94,384

 
$
48,978

 
$
5,219

 
$
6,524

 
$
155,105

Three Months Ended
June 30, 2018

 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
Beginning balance
$
66,546

 
$
56,679

 
$
4,100

 
$
5,537

 
$
132,862

Loans charged-off
(642
)
 
(38
)
 
(99
)
 
(1,422
)
 
(2,201
)
Charged-off loans recovered
819

 
15

 
180

 
495

 
1,509

Net recoveries (charge-offs)
177

 
(23
)
 
81

 
(927
)
 
(692
)
Provision for loan losses
7,534

 
(2,844
)
 
443

 
1,459

 
6,592

Ending balance
$
74,257

 
$
53,812

 
$
4,624

 
$
6,069

 
$
138,762


 
Commercial
and Industrial
 
Commercial
Real Estate
 
Residential
Mortgage
 
Consumer
 
Total
 
(in thousands)
Six Months Ended
June 30, 2019
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
Beginning balance
$
90,956

 
$
49,650

 
$
5,041

 
$
6,212

 
$
151,859

Loans charged-off
(7,355
)
 
—

 
(15
)
 
(3,780
)
 
(11,150
)
Charged-off loans recovered
1,678

 
43

 
10

 
1,103

 
2,834

Net (charge-offs) recoveries
(5,677
)
 
43

 
(5
)
 
(2,677
)
 
(8,316
)
Provision for loan losses
9,105

 
(715
)
 
183

 
2,989

 
11,562

Ending balance
$
94,384

 
$
48,978

 
$
5,219

 
$
6,524

 
$
155,105

Six Months Ended
June 30, 2018
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
Beginning balance
$
57,232

 
$
54,954

 
$
3,605

 
$
5,065

 
$
120,856

Loans charged-off
(773
)
 
(348
)
 
(167
)
 
(2,633
)
 
(3,921
)
Charged-off loans recovered
2,926

 
384

 
260

 
963

 
4,533

Net recoveries (charge-offs)
2,153

 
36

 
93

 
(1,670
)
 
612

Provision for loan losses
14,872

 
(1,178
)
 
926

 
2,674

 
17,294

Ending balance
$
74,257

 
$
53,812

 
$
4,624

 
$
6,069

 
$
138,762


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 June 30, 2019 and December 31, 2018. Loans individually evaluated for impairment represent Valley's impaired loans. Loans acquired with discounts related to credit quality represent Valley's PCI loans.
 
Commercial
and Industrial
 
Commercial
Real Estate
 
Residential
Mortgage
 
Consumer
 
Total
 
(in thousands)
June 30, 2019
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
31,128

 
$
2,604

 
$
668

 
$
50

 
$
34,450

Collectively evaluated for impairment
63,256

 
46,374

 
4,551

 
6,474

 
120,655

Total
$
94,384

 
$
48,978

 
$
5,219

 
$
6,524

 
$
155,105

Loans:
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
103,026

 
$
47,319

 
$
12,494

 
$
740

 
$
163,579

Collectively evaluated for impairment
3,815,868

 
11,711,225

 
3,681,969

 
2,657,564

 
21,866,626

Loans acquired with discounts related to credit quality
696,871

 
2,568,441

 
377,987

 
128,658

 
3,771,957

Total
$
4,615,765

 
$
14,326,985

 
$
4,072,450

 
$
2,786,962

 
$
25,802,162

December 31, 2018
 
 
 
 
 
 
 
 
 
Allowance for loan losses:
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
29,684

 
$
2,628

 
$
600

 
$
113

 
$
33,025

Collectively evaluated for impairment
61,272

 
47,022

 
4,441

 
6,099

 
118,834

Total
$
90,956

 
$
49,650

 
$
5,041

 
$
6,212

 
$
151,859

Loans:
 
 
 
 
 
 
 
 
 
Individually evaluated for impairment
$
97,852

 
$
43,598

 
$
13,904

 
$
1,271

 
$
156,625

Collectively evaluated for impairment
3,492,523

 
10,991,059

 
3,669,080

 
2,536,096

 
20,688,758

Loans acquired with discounts related to credit quality
740,657

 
2,860,750

 
428,416

 
160,263

 
4,190,086

Total
$
4,331,032

 
$
13,895,407

 
$
4,111,400

 
$
2,697,630

 
$
25,035,469