Fair value measurement (Tables)

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures

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

At March 31, 2017
(In thousands)	Level 1		Level 2		Level 3		Total
RECURRING FAIR VALUE MEASUREMENTS
Assets
Investment securities available-for-sale:
U.S. Treasury securities	$	-	$	2,943,120	$	-	$	2,943,120
Obligations of U.S. Government sponsored entities		-		712,282		-		712,282
Obligations of Puerto Rico, States and political subdivisions		-		20,909		-		20,909
Collateralized mortgage obligations - federal agencies		-		1,146,886		-		1,146,886
Mortgage-backed securities		-		4,361,767		1,289		4,363,056
Equity securities		-		1,859		-		1,859
Other		-		9,415		-		9,415
Total investment securities available-for-sale	$	-	$	9,196,238	$	1,289	$	9,197,527
Trading account securities:
Obligations of Puerto Rico, States and political subdivisions	$	-	$	189	$	-	$	189
Collateralized mortgage obligations		-		-		1,061		1,061
Mortgage-backed securities - federal agencies		-		31,279		4,345		35,624
Other		-		13,528		583		14,111
Total trading account securities	$	-	$	44,996	$	5,989	$	50,985
Mortgage servicing rights	$	-	$	-	$	193,698	$	193,698
Derivatives		-		13,097		-		13,097
Total assets measured at fair value on a recurring basis	$	-	$	9,254,331	$	200,976	$	9,455,307
Liabilities
Derivatives	$	-	$	(11,196)	$	-	$	(11,196)
Contingent consideration		-		-		(160,543)		(160,543)
Total liabilities measured at fair value on a recurring basis	$	-	$	(11,196)	$	(160,543)	$	(171,739)

At December 31, 2016
(In thousands)	Level 1		Level 2		Level 3		Total
RECURRING FAIR VALUE MEASUREMENTS
Assets
Investment securities available-for-sale:
U.S. Treasury securities	$	-	$	2,136,620	$	-	$	2,136,620
Obligations of U.S. Government sponsored entities		-		711,850		-		711,850
Obligations of Puerto Rico, States and political subdivisions		-		22,771		-		22,771
Collateralized mortgage obligations - federal agencies		-		1,221,526		-		1,221,526
Mortgage-backed securities		-		4,103,940		1,392		4,105,332
Equity securities		-		2,122		-		2,122
Other		-		9,585		-		9,585
Total investment securities available-for-sale	$	-	$	8,208,414	$	1,392	$	8,209,806
Trading account securities, excluding derivatives:
Obligations of Puerto Rico, States and political subdivisions	$	-	$	1,164	$	-	$	1,164
Collateralized mortgage obligations		-		-		1,321		1,321
Mortgage-backed securities - federal agencies		-		37,991		4,755		42,746
Other		-		13,963		602		14,565
Total trading account securities, excluding derivatives	$	-	$	53,118	$	6,678	$	59,796
Mortgage servicing rights	$	-	$	-	$	196,889	$	196,889
Derivatives		-		14,094		-		14,094
Total assets measured at fair value on a recurring basis	$	-	$	8,275,626	$	204,959	$	8,480,585
Liabilities
Derivatives	$	-	$	(12,842)	$	-	$	(12,842)
Contingent consideration		-		-		(153,158)		(153,158)
Total liabilities measured at fair value on a recurring basis	$	-	$	(12,842)	$	(153,158)	$	(166,000)

Fair Value Measurements, Nonrecurring [Table Text Block]

Quarter ended March 31, 2017
(In thousands)		Level 1		Level 2		Level 3		Total
NONRECURRING FAIR VALUE MEASUREMENTS
Assets											Write-downs
	Loans[1]	$	-	$	-	$	45,133	$	45,133	$	(16,491)
	Other real estate owned[2]		-		-		17,155		17,155		(4,578)
	Other foreclosed assets[2]		-		-		165		165		(73)
Total assets measured at fair value on a nonrecurring basis		$	-	$	-	$	62,453	$	62,453	$	(21,142)

Quarter ended March 31, 2016
(In thousands)		Level 1		Level 2		Level 3		Total
NONRECURRING FAIR VALUE MEASUREMENTS
Assets											Write-downs
	Loans[1]	$	-	$	-	$	30,785	$	30,785	$	(22,850)
	Loans held-for-sale[2]		-		-		1,829		1,829		(296)
	Other real estate owned[3]		-		-		18,592		18,592		(3,920)
	Other foreclosed assets[3]		-		-		66		66		(11)
Total assets measured at fair value on a nonrecurring basis		$	-	$	-	$	51,272	$	51,272	$	(27,077)

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

	Quarter ended March 31, 2017
		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, 2017		$	1,392	$	1,321	$	4,755	$	602	$	196,889	$	204,959	$	(153,158)	$	(153,158)
Gains (losses) included in earnings			-		(4)		(43)		(19)		(5,954)		(6,020)		(7,385)		(7,385)
Gains (losses) included in OCI			10		-		-		-		-		10		-		-
Additions			-		-		164		-		2,763		2,927		-		-
Sales			-		(205)		(156)		-		-		(361)		-		-
Settlements			(25)		(51)		(375)		-		-		(451)		-		-
Transfers out of Level 3			(88)		-		-		-		-		(88)		-		-
Balance at March 31, 2017		$	1,289	$	1,061	$	4,345	$	583	$	193,698	$	200,976	$	(160,543)	$	(160,543)
Changes in unrealized gains
	(losses) included in earnings
	relating to assets still held
	at March 31, 2017	$	-	$	(4)	$	(27)	$	9	$	(723)	$	(745)	$	(7,385)	$	(7,385)

	Quarter ended March 31, 2016
		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, 2016		$	1,434	$	1,831	$	6,454	$	687	$	211,405	$	221,811	$	(120,380)	$	(120,380)
Gains (losses) included in earnings			(2)		(6)		89		(24)		(8,477)		(8,420)		(443)		(443)
Gains (losses) included in OCI			15		-		-		-		-		15		-		-
Additions			-		174		338		-		2,123		2,635		-		-
Sales			-		(106)		(1,120)		-		-		(1,226)		-		-
Settlements			(25)		(110)		(364)		-		-		(499)		-		-
Balance at March 31, 2016		$	1,422	$	1,783	$	5,397	$	663	$	205,051	$	214,316	$	(120,823)	$	(120,823)
Changes in unrealized gains
	(losses) included in earnings
	relating to assets still held
	at March 31, 2016	$	-	$	(3)	$	86	$	11	$	(3,866)	$	(3,772)	$	(443)	$	(443)

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

	Quarter ended March 31, 2017				Quarter ended March 31, 2016
				Changes in unrealized				Changes in unrealized
		Total gains		gains (losses) relating to		Total gains		gains (losses) relating to
		(losses) included		assets still held at		(losses) included		assets still held at
(In thousands)		in earnings		reporting date		in earnings		reporting date
Interest income	$	-	$	-	$	(2)	$	-
FDIC loss share expense		(7,385)		(7,385)		(443)		(443)
Mortgage banking activities		(5,954)		(723)		(8,477)		(3,866)
Trading account loss		(66)		(22)		59		94
Total	$	(13,405)	$	(8,130)	$	(8,863)	$	(4,215)

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

		Fair value
		at March 31,
(In thousands)		2017	Valuation technique	Unobservable inputs	Weighted average (range)
CMO's - trading	$	1,061	Discounted cash flow model	Weighted average life	2.8 years (0.1 - 4.1 years)
				Yield	3.5% (0.7% - 4.2%)
				Prepayment speed	20.3% (18.0% - 22.4%)
Other - trading	$	583	Discounted cash flow model	Weighted average life	5.4	years
				Yield	12.3	%
				Prepayment speed	10.8	%
Mortgage servicing rights	$	193,698	Discounted cash flow model	Prepayment speed	5.3% (0.2% - 15.5%)
				Weighted average life	7.0 years (0.1 - 16.6 years)
				Discount rate	11.2% (9.5% - 15.0%)
Contingent consideration	$	(160,543)	Discounted cash flow model	Credit loss rate on covered loans	3.5% (0.0% - 100.0%)
				Risk premium component
				of discount rate	3.4	%
Loans held-in-portfolio	$	45,133 [1]	External appraisal	Haircut applied on
				external appraisals	25.1% (22.5% - 27.1%)
Other real estate owned	$	14,049 [2]	External appraisal	Haircut applied on
				external appraisals	15.5% (15.0% - 30.0%)