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Fair value measurement (Tables)

12 Months Ended

Dec. 31, 2012

Schedule Of Fair Value Assets And Liabilities Measured On Recurring Basis Table Text Block

At December 31, 2012

(In thousands)	Level 1		Level 2		Level 3		Total

RECURRING FAIR VALUE MEASUREMENTS

Assets
Investment securities available-for-sale:
U.S. Treasury securities	$	-	$	37,238	$	-	$	37,238
Obligations of U.S. Government sponsored entities		-		1,096,318		-		1,096,318
Obligations of Puerto Rico, States and political subdivisions		-		54,981		-		54,981
Collateralized mortgage obligations - federal agencies		-		2,367,065		-		2,367,065
Collateralized mortgage obligations - private label		-		2,473		-		2,473
Mortgage-backed securities		-		1,476,077		7,070		1,483,147
Equity securities		3,827		3,579		-		7,406
Other		-		35,573		-		35,573
Total investment securities available-for-sale	$	3,827	$	5,073,304	$	7,070	$	5,084,201

Trading account securities, excluding derivatives:
Obligations of Puerto Rico, States and political subdivisions	$	-	$	24,801	$	-	$	24,801
Collateralized mortgage obligations		-		618		2,499		3,117
Mortgage-backed securities - federal agencies		-		251,046		11,817		262,863
Other		-		21,494		2,240		23,734
Total trading account securities	$	-	$	297,959	$	16,556	$	314,515
Mortgage servicing rights	$	-	$	-	$	154,430	$	154,430
Derivatives		-		41,935		-		41,935
Total assets measured at fair value on a recurring basis	$	3,827	$	5,413,198	$	178,056	$	5,595,081
Liabilities
Derivatives	$	-	$	(42,585)	$	-	$	(42,585)
Contingent consideration		-		-		(112,002)		(112,002)
Total liabilities measured at fair value on a recurring basis	$	-	$	(42,585)	$	(112,002)	$	(154,587)

At December 31, 2011

(In thousands)	Level 1		Level 2		Level 3		Total

RECURRING FAIR VALUE MEASUREMENTS

Assets
Investment securities available-for-sale:
U.S. Treasury securities	$	-	$	38,668	$	-	$	38,668
Obligations of U.S. Government sponsored entities		-		985,546		-		985,546
Obligations of Puerto Rico, States and political subdivisions		-		58,728		-		58,728
Collateralized mortgage obligations - federal agencies		-		1,697,642		-		1,697,642
Collateralized mortgage obligations - private label		-		57,792		-		57,792
Mortgage-backed securities		-		2,132,134		7,435		2,139,569
Equity securities		3,465		3,451		-		6,916
Other		-		24,962		-		24,962
Total investment securities available-for-sale	$	3,465	$	4,998,923	$	7,435	$	5,009,823

Trading account securities, excluding derivatives:
Obligations of Puerto Rico, States and political subdivisions	$	-	$	90,332	$	-	$	90,332
Collateralized mortgage obligations		-		737		2,808		3,545
Mortgage-backed securities - federal agencies		-		303,428		21,777		325,205
Other		-		13,212		4,036		17,248
Total trading account securities	$	-	$	407,709	$	28,621	$	436,330
Mortgage servicing rights	$	-	$	-	$	151,323	$	151,323
Derivatives		-		61,887		-		61,887
Total assets measured at fair value on a recurring basis	$	3,465	$	5,468,519	$	187,379	$	5,659,363
Liabilities
Derivatives	$	-	$	(66,700)	$	-	$	(66,700)
Contingent consideration		-		-		(99,762)		(99,762)
Total liabilities measured at fair value on a recurring basis	$	-	$	(66,700)	$	(99,762)	$	(166,462)

Fair Value Measurements, Nonrecurring [Table Text Block]

Year ended December 31, 2012

(In thousands)	Level 1		Level 2		Level 3		Total

NONRECURRING FAIR VALUE MEASUREMENTS
Assets										Write-downs
Loans^[1]	$	-	$	-	$	10,445	$	10,445	$	(23,972)
Loans held-for-sale^[2]		-		-		93,429		93,429		(43,937)
Other real estate owned^[3]		-		-		111,425		111,425		(32,783)
Other foreclosed assets^[3]		-		-		128		128		(360)
Long-lived assets held-for-sale^[4]		-		-		-		-		(123)
Total assets measured at fair value on a nonrecurring basis	$	-	$	-	$	215,427	$	215,427	$	(101,175)

Year ended December 31, 2011

(In thousands)	Level 1		Level 2		Level 3		Total

NONRECURRING FAIR VALUE MEASUREMENTS
Assets										Write-downs
Loans^[1]	$	-	$	-	$	95,978	$	95,978	$	(5,863)
Loans held-for-sale^[2]		-		-		83,915		83,915		(30,094)
Other real estate owned^[3]		-		-		91,432		91,432		(22,923)
Other foreclosed assets^[3]		-		-		377		377		(708)
Total assets measured at fair value on a nonrecurring basis	$	-	$	-	$	271,702	$	271,702	$	(59,588)

Year ended December 31, 2010

(In thousands)	Level 1		Level 2		Level 3		Total

NONRECURRING FAIR VALUE MEASUREMENTS
Assets										Write-downs
Loans^[1]	$	-	$	-	$	204,427	$	204,427	$	(13,971)
Loans held-for-sale^[2]		-		-		671,223		671,223		(342,035)
Other real estate owned^[3]		-		-		45,454		45,454		(28,334)
Other foreclosed assets^[3]		-		-		73		73		(855)
Total assets measured at fair value on a nonrecurring basis	$	-	$	-	$	921,177	$	921,177	$	(385,195)

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

	Year ended December 31, 2012
		MBS						Other
		classified		CMOs				securities
		as investment		classified		MBS		classified
		securities		as trading		classified as		as trading		Mortgage
		available-		account		trading account		account		servicing		Total		Contingent		Total
(In thousands)		for-sale		securities		securities		securities		rights		assets		consideration		liabilities
Balance at January 1, 2012		$	7,435	$	2,808	$	21,777	$	4,036	$	151,323	$	187,379	$	(99,762)	$	(99,762)
Gains (losses) included in earnings			(6)		30		680		(123)		(17,406)		(16,825)		(12,600)		(12,600)
Gains (losses) included in OCI			66		-		-		-		-		66		-		-
Purchases			-		608		6,499		2,116		20,726		29,949		-		-
Sales			-		(250)		(9,824)		(1,834)		(103)		(12,011)		-		-
Settlements			(425)		(697)		(2,104)		(1,955)		(110)		(5,291)		360		360
Transfers into Level 3			-		-		2,405		-		-		2,405		-		-
Transfers out of Level 3			-		-		(7,616)		-		-		(7,616)		-		-
Balance at December 31, 2012		$	7,070	$	2,499	$	11,817	$	2,240	$	154,430	$	178,056	$	(112,002)	$	(112,002)
Changes in unrealized gains
	(losses) included in earnings
	relating to assets still held
	at December 31, 2012	$	-	$	23	$	(165)	$	(333)	$	8,130	$	7,655	$	(13,347)	$	(13,347)

	Year ended December 31, 2011
		MBS						Other
		classified		CMOs				securities
		as investment		classified		MBS		classified
		securities		as trading		classified as		as trading		Mortgage
		available-		account		trading account		account		servicing		Total		Contingent		Total
(In thousands)		for-sale		securities		securities		securities		rights		assets		consideration		liabilities
Balance at January 1, 2011		$	7,759	$	2,746	$	20,238	$	2,810	$	166,907	$	200,460	$	(92,994)	$	(92,994)
Initial fair value on acquisition			-		-		-		-		-		-		(688)		(688)
Gains (losses) included in earnings			(7)		21		108		459		(37,061)		(36,480)		(6,080)		(6,080)
Gains (losses) included in OCI			(18)		-		-		-		-		(18)		-		-
Purchases			-		752		13,395		3,263		21,703		39,113		-		-
Sales			-		(341)		(9,956)		(2,449)		-		(12,746)		-		-
Settlements			(299)		(370)		(2,008)		(47)		(226)		(2,950)		-		-
Balance at December 31, 2011		$	7,435	$	2,808	$	21,777	$	4,036	$	151,323	$	187,379	$	(99,762)	$	(99,762)
Changes in unrealized gains
	(losses) included in earnings
	relating to assets still held
	at December 31, 2011	$	-	$	7	$	133	$	698	$	(20,188)	$	(19,350)	$	(6,380)	$	(6,380)

	Year ended December 31, 2010
		MBS						Other
		classified		CMOs				securities
		as investment		classified		MBS		classified
		securities		as trading		classified as		as trading		Mortgage
		available-		account		trading account		account		servicing		Total		Contingent		Total
(In thousands)		for-sale		securities		securities		securities		rights		assets		consideration		liabilities
Balance at January 1, 2010		$	34,122	$	2,787	$	223,766	$	3,488	$	169,747	$	433,910	$	-	$	-
Initial fair value on acquisition			-		-		-		-		-		-		(89,139)		(89,139)
Gains (losses) included in earnings			(8)		1		3,737		(438)		(22,859)		(19,567)		(3,855)		(3,855)
Gains (losses) included in OCI			744		-		-		-		-		744		-		-
Issuances			2,502		-		101		-		-		2,603		-		-
Purchases			-		715		23,451		706		20,019		44,891		-		-
Sales			-		(302)		(48,928)		(896)		-		(50,126)		-		-
Settlements			(2,305)		(455)		(11,542)		(50)		-		(14,352)		-		-
Transfers out of Level 3			(27,296)		-		(170,347)		-		-		(197,643)		-		-
Balance at December 31, 2010		$	7,759	$	2,746	$	20,238	$	2,810	$	166,907	$	200,460	$	(92,994)	$	(92,994)
Changes in unrealized gains
	(losses) included in earnings
	relating to assets still held
	at December 31, 2010	$	-	$	(5)	$	178	$	(450)	$	(5,963)	$	(6,240)	$	(3,855)	$	(3,855)

Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Table Text Block]

		2012				2011				2010
		Total		Changes in unrealized		Total		Changes in unrealized		Total		Changes in unrealized
		gains (losses)		gains (losses)		gains (losses)		gains (losses)		gains (losses)		gains (losses)
		included		relating to assets still		included		relating to assets still		included		relating to assets still
(In thousands)		in earnings		held at reporting date		in earnings		held at reporting date		in earnings		held at reporting date
Interest income		$	(6)	$	-	$	(7)	$	-	$	(8)	$	-
FDIC loss share (expense)
	income		(13,178)		(13,178)		(6,304)		(6,304)		(3,855)		(3,855)
Other service fees			(17,406)		8,130		(37,061)		(20,188)		(22,859)		(5,963)
Trading account (loss) profit			587		(475)		588		838		3,300		(277)
Other operating income			578		(169)		224		(76)		-		-
Total		$	(29,425)	$	(5,692)	$	(42,560)	$	(25,730)	$	(23,422)	$	(10,095)

Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block]

			Fair Value at			Weighted
			December 31,	Valuation	Unobservable	Average
(In thousands)			2012	Technique	Inputs	(Range)
Collateralized				Discounted	Weighted average life	2.3 years (0.2 - 5.1 years)
	mortgage			cash flow	Yield	3.7% (0.6% - 4.7%)
	obligations - trading	$	2,499	model	Constant prepayment rate	27.8% (26.2% - 30.1%)
Other - trading				Discounted	Weighted average life	5.4	years
				cash flow	Yield	11.4	%
		$	1,136	model	Constant prepayment rate	10.8	%
Mortgage servicing				Discounted	Prepayment speed	9.6% (4.3% - 26.0%)
	rights			cash flow	Weighted average life	10.4 years (3.8 - 23.2 years)
		$	154,430	model	Discount rate	12.0% (10.0 - 17.5%)
Contingent				Discounted	Credit loss rate on covered loans	20.3% (0.0% - 85.7%)
	consideration			cash flow	Risk premium component
		$	(112,002)	model	of discount rate	4.9	%
Loans held-in-portfolio				External	Haircut applied on
		$	10,445	Appraisal	external appraisals	17.6% (5.0% - 30.0%)
Loans held-for-sale				Discounted
				cash flow	Weighted average life	2.0	years
		$	93,429^[1]	model	Net loss rate	58.1%
Other real estate owned				External	Haircut applied on
		$	56,567^[2]	Appraisal	external appraisals	24.4% (5.0% - 40.0%)

- Definition

Tabular disclosure of the amount of gains or losses for the period included in earnings or resulted in a change to net assets, have arisen from the use of significant unobservable inputs (level 3) to measure the fair value of assets, liabilities, and financial instruments classified in shareholders' equity.

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- Definition

Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

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- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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