Loans and Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2011

Loans and Allowance for Loan Losses

The composition of loans, net of unearned income of $60.2 million and $45.5 million at December 31, 2011 and 2010, respectively, is presented in the following table:

	December 31,
(Dollars in thousands)	2011		2010
Commercial loans:
Software	$	2,492,849	$	1,820,680
Hardware		952,303		641,052
Venture capital/private equity		1,117,419		1,036,201
Life science		863,737		575,944
Premium wine (1)		130,245		144,972
Other		342,147		375,928
Commercial loans		5,898,700		4,594,777
Real estate secured loans:
Premium wine (1)		345,988		312,255
Consumer loans (2)		534,001		361,704
Real estate secured loans		879,989		673,959
Construction loans		30,256		60,178
Consumer loans		161,137		192,823
Total loans, net of unearned income (3)	$	6,970,082	$	5,521,737

(1) Included in our premium wine portfolio are gross construction loans of $110.8 million and $119.0 million at December 31, 2011 and 2010, respectively.

(2) Consumer loans secured by real estate at December 31, 2011 and 2010 were comprised of the following:

	December 31,
(Dollars in thousands)	2011		2010
Loans for personal residences	$	350,359	$	189,039
Loans to eligible employees		99,704		88,510
Home equity lines of credit		83,938		84,155
Consumer loans secured by real estate	$	534,001	$	361,704

(3) Included within our total loan portfolio are credit card loans of $49.7 million and $32.5 million at December 31, 2011 and 2010, respectively.

Composition of Loans, Net of Unearned Income, Broken Out by Portfolio Segment and Class of Financing Receivable

The composition of loans, net of unearned income, broken out by portfolio segment and class of financing receivable as of December 31, 2011 and 2010 is as follows:

	December 31,
(Dollars in thousands)	2011		2010
Commercial loans:
Software	$	2,492,849	$	1,820,680
Hardware		952,303		641,052
Venture capital/private equity		1,117,419		1,036,201
Life science		863,737		575,944
Premium wine		476,233		457,227
Other		372,403		436,106
Total commercial loans		6,274,944		4,967,210
Consumer loans:
Real estate secured loans		534,001		361,704
Other consumer loans		161,137		192,823
Total consumer loans		695,138		554,527
Total loans, net of unearned income	$	6,970,082	$	5,521,737

Aging of Gross Loans, Broken out by Portfolio Segment and Class of Financing Receivable

The following table summarizes the aging of our gross loans, broken out by portfolio segment and class of financing receivable as of December 31, 2011 and 2010:

(Dollars in thousands)	30 - 59 Days Past Due		60 - 89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Loans Past Due 90 Days or More Still Accruing Interest
December 31, 2011:
Commercial loans:
Software	$	415	$	1,006	$	—	$	1,421	$	2,515,327	$	—
Hardware		1,951		45		—		1,996		954,690		—
Venture capital/private equity		45		—		—		45		1,128,475		—
Life science		398		78		—		476		871,626		—
Premium wine		1		174		—		175		475,406		—
Other		15		—		—		15		370,539		—
Total commercial loans		2,825		1,303		—		4,128		6,316,063		—
Consumer loans:
Real estate secured loans		—		—		—		—		515,534		—
Other consumer loans		590		—		—		590		157,389		—
Total consumer loans		590		—		—		590		672,923		—
Total gross loans excluding impaired loans		3,415		1,303		—		4,718		6,988,986		—
Impaired loans		1,350		1,794		6,613		9,757		26,860		—
Total gross loans	$	4,765	$	3,097	$	6,613	$	14,475	$	7,015,846	$	—
December 31, 2010:
Commercial loans:
Software	$	674	$	239	$	17	$	930	$	1,834,897	$	17
Hardware		89		819		27		935		642,786		27
Venture capital/private equity		—		—		—		—		1,046,696		—
Life science		157		—		—		157		578,208		—
Premium wine		—		—		—		—		451,006		—
Other		—		—		—		—		438,345		—
Total commercial loans		920		1,058		44		2,022		4,991,938		44
Consumer loans:
Real estate secured loans		—		—		—		—		341,048		—
Other consumer loans		—		—		—		—		192,771		—
Total consumer loans		—		—		—		—		533,819		—
Total gross loans excluding impaired loans		920		1,058		44		2,022		5,525,757		44
Impaired loans		323		913		7,805		9,041		30,385		—
Total gross loans	$	1,243	$	1,971	$	7,849	$	11,063	$	5,556,142	$	44

Impaired Loans and Allowance for Loan Losses, Broken out by Portfolio Segment and Class of Financing Receivable

The following table summarizes our impaired loans as they relate to our allowance for loan losses, broken out by portfolio segment and class of financing receivable as of December 31, 2011 and 2010:

(Dollars in thousands)	Impaired loans for which there is a related allowance for loan losses		Impaired loans for which there is no related allowance for loan losses		Total carrying value of impaired loans		Total unpaid principal of impaired loans
December 31, 2011:
Commercial loans:
Software	$	1,142	$	—	$	1,142	$	1,540
Hardware		4,754		429		5,183		8,843
Life science		—		311		311		523
Premium wine		—		3,212		3,212		3,341
Other		4,303		1,050		5,353		9,104
Total commercial loans		10,199		5,002		15,201		23,351
Consumer loans:
Real estate secured loans		—		18,283		18,283		22,410
Other consumer loans		3,133		—		3,133		3,197
Total consumer loans		3,133		18,283		21,416		25,607
Total	$	13,332	$	23,285	$	36,617	$	48,958
December 31, 2010:
Commercial loans:
Software	$	2,958	$	334	$	3,292	$	5,332
Hardware		3,517		307		3,824		3,931
Life science		2,050		1,362		3,412		4,369
Premium wine		2,995		3,167		6,162		7,129
Other		1,158		1,019		2,177		2,790
Total commercial loans		12,678		6,189		18,867		23,551
Consumer loans:
Real estate secured loans		20,559		—		20,559		23,430
Total consumer loans		20,559		—		20,559		23,430
Total	$	33,237	$	6,189	$	39,426	$	46,981

Average Impaired Loans, Broken out by Portfolio Segment and Class of Financing Receivable

The following table summarizes our average impaired loans, broken out by portfolio segment and class of financing receivable during 2011 and 2010:

	Year ended December 31,
(Dollars in thousands)	2011		2010
Average impaired loans:
Commercial loans:
Software	$	2,575	$	6,153
Hardware		5,854		9,485
Life science		1,228		5,772
Premium wine		2,566		1,461
Other		4,751		2,279
Total commercial loans		16,974		25,150
Consumer loans:
Real estate secured loans		19,179		21,055
Other consumer loans		1,076		117
Total consumer loans		20,255		21,172
Total average impaired loans	$	37,229	$	46,322

Activity in Allowance for Loan Losses Broken out by Portfolio Segment

The following table summarizes the activity in the allowance for loan losses during 2011 and 2010, broken out by portfolio segment and class of financing receivable:

Year ended December 31, 2011 (dollars in thousands)	Beginning Balance		Charge-offs			Recoveries		Provision (Reduction of)			Ending Balance
Commercial loans:
Software	$	29,288	$	(10,252	)	$	11,659	$	7,568		$	38,263
Hardware		14,688		(4,828	)		455		6,495			16,810
Venture capital/private equity		8,241		—			—		(922	)		7,319
Life science		9,077		(4,201	)		6,644		(1,277	)		10,243
Premium wine		5,492		(449	)		1,223		(2,352	)		3,914
Other		5,318		(3,954	)		471		3,982			5,817
Total commercial loans		72,104		(23,684	)		20,452		13,494			82,366
Consumer loans		10,523		(220	)		4,671		(7,393	)		7,581
Total allowance for loan losses	$	82,627	$	(23,904	)	$	25,123	$	6,101		$	89,947
Year ended December 31, 2010 (dollars in thousands)	Beginning Balance		Charge-offs			Recoveries		Provision			Ending Balance
Commercial loans:
Software	$	24,209	$	(16,230	)	$	5,838	$	15,471		$	29,288
Hardware		16,194		(10,568	)		5,715		3,347			14,688
Venture capital/private equity		5,664		—			—		2,577			8,241
Life science		9,651		(17,629	)		3,738		13,317			9,077
Premium wine		4,652		(1,457	)		222		2,075			5,492
Other		3,877		(4,866	)		737		5,570			5,318
Total commercial loans		64,247		(50,750	)		16,250		42,357			72,104
Consumer loans		8,203		(489	)		538		2,271			10,523
Total allowance for loan losses	$	72,450	$	(51,239	)	$	16,788	$	44,628		$	82,627

Allowance for Loan Losses Individually and Collectively Evaluated for Impairment

The following table summarizes the allowance for loan losses individually and collectively evaluated for impairment as of December 31, 2011 and 2010, broken out by portfolio segment:

	December 31, 2011				December 31, 2010
(Dollars in thousands)	Individually Evaluated for Impairment		Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Collectively Evaluated for Impairment
Commercial loans:
Software	$	526	$	37,737	$	986	$	28,302
Hardware		1,261		15,549		1,348		13,340
Venture capital/private equity		—		7,319		—		8,241
Life science		—		10,243		346		8,731
Premium wine		—		3,914		438		5,054
Other		1,180		4,637		122		5,196
Total commercial loans		2,967		79,399		3,240		68,864
Consumer loans		740		6,841		3,696		6,827
Total allowance for loan losses	$	3,707	$	86,240	$	6,936	$	75,691

Credit Quality Indicators, Broken out by Portfolio Segment and Class of Financing Receivables

The following table summarizes the credit quality indicators, broken out by portfolio segment and class of financing receivables as of December 31, 2011 and 2010:

(Dollars in thousands)	Pass		Performing (Criticized)		Impaired		Total
December 31, 2011:
Commercial loans:
Software	$	2,290,497	$	226,251	$	1,142	$	2,517,890
Hardware		839,230		117,456		5,183		961,869
Venture capital/private equity		1,120,373		8,147		—		1,128,520
Life science		748,129		123,973		311		872,413
Premium wine		434,309		41,272		3,212		478,793
Other		353,434		17,120		5,353		375,907
Total commercial loans		5,785,972		534,219		15,201		6,335,392
Consumer loans:
Real estate secured loans		497,060		18,474		18,283		533,817
Other consumer loans		151,101		6,878		3,133		161,112
Total consumer loans		648,161		25,352		21,416		694,929
Total gross loans	$	6,434,133	$	559,571	$	36,617	$	7,030,321
December 31, 2010:
Commercial loans:
Software	$	1,717,309	$	118,518	$	3,292	$	1,839,119
Hardware		575,401		68,320		3,824		647,545
Venture capital/private equity		1,031,373		15,323		—		1,046,696
Life science		520,596		57,769		3,412		581,777
Premium wine		400,519		50,487		6,162		457,168
Other		415,381		22,964		2,177		440,522
Total commercial loans		4,660,579		333,381		18,867		5,012,827
Consumer loans:
Real estate secured loans		337,087		3,961		20,559		361,607
Other consumer loans		181,561		11,210		—		192,771
Total consumer loans		518,648		15,171		20,559		554,378
Total gross loans	$	5,179,227	$	348,552	$	39,426	$	5,567,205

Summary of Loans Modified in Troubled Debt Restructurings ("TDRs") by Portfolio Segment and Class of Financing Receivables

The following table summarizes our loans modified in TDRs, broken out by portfolio segment and class of financing receivables as of December 31, 2011:

(Dollars in thousands)	December 31, 2011
Loans modified in TDRs:
Commercial loans:
Software	$	1,142
Hardware		5,183
Premium wine		1,949
Other		4,934
Total commercial loans		13,208
Consumer loans:
Real estate secured loans		17,934
Other consumer loans		3,133
Total consumer loans		21,067
Total	$	34,275

Recorded Investment in Loans Modified in TDRs

The following table summarizes the recorded investment in loans modified in TDRs, broken out by portfolio segment and class of financing receivable, for modifications made during 2011.

(Dollars in thousands)	Year ended December 31, 2011
Loans modified in TDRs during the period:
Commercial loans:
Software	$	615
Hardware		4,018
Premium wine		1,949
Other		3,884
Total commercial loans (1)		10,466
Consumer loans:
Other consumer loans		3,133
Total consumer loans		3,133
Total loans modified in TDR’s during the period	$	13,599

(1) During 2011, we had partial charge-offs of $2.8 million on loans classified as TDRs.

Recorded Investment in Loans Modified in TDRs within the Previous 12 months that Subsequently Defaulted

The following table summarizes the recorded investment in loans modified in TDRs within the previous 12 months that subsequently defaulted during 2011, broken out by portfolio segment and class of financing receivable:

(Dollars in thousands)	Year ended December 31, 2011
TDRs modified within the previous 12 months that defaulted during the period:
Commercial loans:
Hardware	$	1,885
Premium wine		1,949
Total commercial loans		3,834
Consumer loans:
Other consumer loans		3,133
Total consumer loans		3,133
Total TDRs modified within the previous 12 months that defaulted in the period	$	6,967