Allowance for Credit Losses

6 Months Ended

Jun. 30, 2013

Receivables [Abstract]

Allowance for Credit Losses

Note 8. 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 of non-covered PCI loan pools subsequent to the acquisition date.

The following table summarizes the allowance for credit losses at June 30, 2013 and December 31, 2012:

	June 30, 2013		December 31, 2012
	(in thousands)
Components of allowance for credit losses:
Allowance for non-covered loans	$	110,374	$	120,708
Allowance for covered loans		7,070		9,492
Total allowance for loan losses		117,444		130,200
Allowance for unfunded letters of credit		2,436		2,295
Total allowance for credit losses	$	119,880	$	132,495

The following table summarizes the provision for credit losses for the periods indicated:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(in thousands)
Components of provision for credit losses:
Provision for non-covered loans	$	2,746		$	7,429		$	6,456		$	12,803
Provision for covered loans		(110	)		—			(2,276	)		—
Total provision for loan losses		2,636			7,429			4,180			12,803
Provision for unfunded letters of credit		(84	)		(24	)		141			299
Total provision for credit losses	$	2,552		$	7,405		$	4,321		$	13,102

The following table details activity in the allowance for loan losses by portfolio segment for the three months ended June 30, 2013 and 2012:

	Commercial and Industrial			Commercial Real Estate			Residential Mortgage			Consumer			Unallocated			Total
	(in thousands)
Three Months Ended June 30, 2013:
Allowance for loan losses:
Beginning balance	$	55,732		$	44,195		$	9,331		$	5,460		$	7,126		$	121,844
Loans charged-off		(1,441	)		(4,389	)		(1,666	)		(860	)		—			(8,356	)
Charged-off loans recovered		602			50			68			600			—			1,320
Net charge-offs		(839	)		(4,339	)		(1,598	)		(260	)		—			(7,036	)
Provision for loan losses		(1,161	)		3,323			788			(116	)		(198	)		2,636
Ending balance	$	53,732		$	43,179		$	8,521		$	5,084		$	6,928		$	117,444
Three Months Ended June 30, 2012:
Allowance for loan losses:
Beginning balance	$	73,311		$	34,415		$	9,837		$	7,940		$	7,367		$	132,870
Loans charged-off *		(5,406	)		(5,379	)		(583	)		(1,015	)		—			(12,383	)
Charged-off loans recovered		1,304			116			111			407			—			1,938
Net charge-offs		(4,102	)		(5,263	)		(472	)		(608	)		—			(10,445	)
Provision for loan losses		1,313			6,406			1,375			(1,523	)		(142	)		7,429
Ending balance	$	70,522		$	35,558		$	10,740		$	5,809		$	7,225		$	129,854

* The allowance for covered loans was reduced by loan charge-offs totaling $1.8 million during the second quarter of 2012.

The following tables detail the activity in the allowance for loan losses by portfolio segment for the six months ended June 30, 2013 and 2012, including both covered and non-covered loans:

	Commercial and Industrial			Commercial Real Estate			Residential Mortgage			Consumer			Unallocated			Total
	(in thousands)
Six Months Ended June 30, 2013:
Allowance for loan losses:
Beginning balance	$	64,370		$	44,069		$	9,423		$	5,542		$	6,796		$	130,200
Loans charged-off		(8,766	)		(6,382	)		(2,558	)		(2,369	)		—			(20,075	)
Charged-off loans recovered		1,940			65			138			996			—			3,139
Net charge-offs		(6,826	)		(6,317	)		(2,420	)		(1,373	)		—			(16,936	)
Provision for loan losses		(3,812	)		5,427			1,518			915			132			4,180
Ending balance	$	53,732		$	43,179		$	8,521		$	5,084		$	6,928		$	117,444
Six Months Ended June 30, 2012:
Allowance for loan losses:
Beginning balance	$	73,649		$	34,637		$	9,120		$	8,677		$	7,719		$	133,802
Loans charged-off *		(10,213	)		(6,459	)		(1,759	)		(2,498	)		—			(20,929	)
Charged-off loans recovered		2,309			236			625			1,008			—			4,178
Net charge-offs		(7,904	)		(6,223	)		(1,134	)		(1,490	)		—			(16,751	)
Provision for loan losses		4,777			7,144			2,754			(1,378	)		(494	)		12,803
Ending balance	$	70,522		$	35,558		$	10,740		$	5,809		$	7,225		$	129,854

* The allowance for covered loans was reduced by loan charge-offs totaling $1.8 million for the six months ended June 30, 2012.

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, 2013 and December 31, 2012.

	Commercial and Industrial		Commercial Real Estate		Residential Mortgage		Consumer		Unallocated		Total
	(in thousands)
June 30, 2013
Allowance for loan losses:
Individually evaluated for impairment	$	11,420	$	14,632	$	2,677	$	11	$	—	$	28,740
Collectively evaluated for impairment		41,800		22,115		5,721		5,070		6,928		81,634
Loans acquired with discounts related to credit quality		512		6,432		123		3		—		7,070
Total	$	53,732	$	43,179	$	8,521	$	5,084	$	6,928	$	117,444
Loans:
Individually evaluated for impairment	$	57,595	$	130,631	$	26,879	$	1,186	$	—	$	216,291
Collectively evaluated for impairment		1,743,223		4,166,945		2,371,005		1,434,156		—		9,715,329
Loans acquired with discounts related to credit quality		220,576		665,220		24,004		41,605		—		951,405
Total	$	2,021,394	$	4,962,796	$	2,421,888	$	1,476,947	$	—	$	10,883,025
December 31, 2012
Allowance for loan losses:
Individually evaluated for impairment	$	12,088	$	16,581	$	2,329	$	15	$	—	$	31,013
Collectively evaluated for impairment		44,877		25,463		7,032		5,527		6,796		89,695
Loans acquired with discounts related to credit quality		7,405		2,025		62		—		—		9,492
Total	$	64,370	$	44,069	$	9,423	$	5,542	$	6,796	$	130,200
Loans:
Individually evaluated for impairment	$	49,697	$	131,216	$	24,891	$	930	$	—	$	206,734
Collectively evaluated for impairment		1,783,046		4,040,723		2,420,736		1,403,896		—		9,648,401
Loans acquired with discounts related to credit quality		298,600		793,406		26,461		49,197		—		1,167,664
Total	$	2,131,343	$	4,965,345	$	2,472,088	$	1,454,023	$	—	$	11,022,799