Segment Reporting

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Reporting

NOTE 15: Segment Reporting

The Corporation utilizes a risk-based internal profitability measurement system to provide strategic business unit reporting. The profitability measurement system is based on internal management methodologies designed to produce consistent results and reflect the underlying economics of the units. Certain strategic business units have been combined for segment information reporting purposes where the nature of the products and services, the type of customer and the distribution of those products and services are similar. The three reportable segments are Commercial Banking, Consumer Banking, and Risk Management and Shared Services,with no segment representing more than half of the assets, liabilities or Tier 1common equity of the Corporation as a whole.

The financial information of the Corporation's segments has been compiled utilizing the accounting policies described inthe Corporation's 2013 annual report on Form 10-K with certain exceptions. The more significant of these exceptions are described herein. The Corporation allocates interest income or interest expense using a funds transfer pricing methodology that charges users of funds (assets) interest expense and credits providers of funds (liabilities, primarily deposits) with income based on the maturity, prepayment and/or repricing characteristics of the assets and liabilities. The net effect of this allocation is recorded in the Risk Management and Shared Services segment. A credit provision is allocated to segments based on the expected long-term annual net charge off rates attributable to the credit risk of loans managed by the segment during the period. In contrast, the level of the consolidated provision for credit losses is determined using the methodologies described in the Corporation's 2013 annual report on Form 10-K to assess the overall appropriateness of the allowance for credit losses. The net effect of the credit provision is recorded in Risk Management and Shared Services. Indirect expenses incurred by certain centralized support areas are allocated to segments based on actual usage (for example, volume measurements) and other criteria. Certain types of administrative expense and bank-wide expense accruals (including amortization of core deposit and other intangible assets associated with acquisitions) are generally not allocated to segments. Income taxes are allocated to segments based on the Corporation's estimated effective tax rate, with certain segments adjusted for any tax-exempt income or non-deductible expenses. Equity is allocated to the segments based on regulatory capital requirements and in proportion to an assessment of the inherent risks associated with the business of the segment (including interest, credit and operating risk).

The management accounting policies and processes utilized in compiling segment financial information are highly subjective and, unlike financial accounting, are not based on authoritative guidance similar to U.S. generally accepted accounting principles. As a result, reported segments and the financial information of the reported segments are not necessarily comparable with similar information reported by other financial institutions. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in previously reported segment financial data. During 2013, certain organization and methodology changes were made and, accordingly, 2013 results have been restated and presented on a comparable basis.

A description of each business segment is presented below.

Commercial Banking– The Commercial Banking segment serves a wide range of customers including, businesses, developers, non-profits,municipalities, and financial institutions. Business customers in this segment typically include companies with annual sales over $10millionand delivery of services is provided through our regional and middle market units, our commercial real estate unit, as well as our specialized industries and commercial financial services area. The financial solutions provided to our customers include but are not limited to: (1) Lending solutions, such as business loans and lines of credit, business credit cards, commercial real estate financing, construction loans, letters of credit, leasing, and asset based lending. For our larger clients we also offer syndicated loans to meet their lending needs; (2) Deposit and cash management solutions such as business checking and interest-bearing deposit products, safe deposit and night depository services, liquidity solutions, payables and receivables solutions; and information services; and (3) Specialized financial services such as insurance and benefits related products and services, risk management, and international banking solutions. In serving the commercial banking segment we compete based on an in-depth understanding of our customers' financial needs, the ability to match market competitive solutions to those needs, and the highest standards of relationship and service excellence in the delivery of these services.

Consumer Banking – The Consumer Banking segment serves individuals and small businesses (typically entities with less than $10million in annual sales) through our various Retail Banking and Private Client offices, and provides companies of varying sizes with fiduciary services such as administration of pension, profit-sharing and other employee benefit plans, fiduciary and corporate agency services, and institutional asset management. The services provided to our individual and small business customers include but are not limited to: (1) Transactional solutions such as checking, credit, debit and pre-paid cards, online banking and bill pay, and money transfer services; (2) Lending solutions such as residential mortgages, home equity loans and lines of credit, business loans and lines, and personal and installment loans; and (3) Investable funds solutions such as savings, money market deposit accounts, IRA accounts, certificates of deposit, fixed and variable annuities, full-service, discount and on-line investment brokerage; as well as trust and investment management accounts. In serving the consumer banking segment we compete based on providing a broad range of solutions to meet the needs of our customers in their entire financial lifecycle, convenient access to our services through multiple channels such as branches, phone based services, online and mobile banking, and a relationship based business model which assists our customers in navigating any changes and challenges in their financial circumstances.

Risk Management and Shared Services – The Risk Management and Shared Services segment includes Corporate Risk Management, Credit Administration, Finance, Treasury, Operations and Technology, which are key shared functions. The segment also includes Parent Company activity, intersegment eliminations and residual revenue and expenses, representing the difference between actual amounts incurred and the amounts allocated to operating segments, including interest rate risk residuals (funds transfer pricing mismatches) and credit risk and provision residuals (long term credit charge mismatches). The earning assets within this segment include the Corporation's investment portfolio and capital includes both allocated as well as any remaining unallocated capital.

Information about the Corporation's segments is presented below.

Segment Income Statement Data
	($ in Thousands)		Commercial Banking		Consumer Banking			Risk Management and Shared Services			Consolidated Total
Three Months Ended March 31, 2014
Net interest income		$	73,543		$	71,997		$	19,433		$	164,973
Noninterest income			24,234			43,448			5,839			73,521
	Total revenue		97,777			115,445			25,272			238,494
Credit provision *			13,032			4,948			(12,980)			5,000
Noninterest expense			47,268			99,482			20,908			167,658
Income before income taxes			37,477			11,015			17,344			65,836
Income tax expense			13,117			3,855			3,665			20,637
Net income		$	24,360		$	7,160		$	13,679		$	45,199
Return on average allocated capital (ROT1CE) **			12.5	%		5.9	%		8.1	%		9.4	%
Three Months Ended March 31, 2013
Net interest income		$	77,180		$	79,191		$	1,282		$	157,653
Noninterest income			23,169			54,195			4,636			82,000
	Total revenue		100,349			133,386			5,918			239,653
Credit provision *			12,213			4,472			(13,385)			3,300
Noninterest expense			46,644			102,513			18,458			167,615
Income before income taxes			41,492			26,401			845			68,738
Income tax expense (benefit)			14,522			9,240			(2,412)			21,350
Net income		$	26,970		$	17,161		$	3,257		$	47,388
Return on average allocated capital (ROT1CE) **			14.5	%		12.8	%		1.4	%		10.1	%
Segment Balance Sheet Data
	($ in Thousands)		Commercial Banking		Consumer Banking			Risk Management and Shared Services			Consolidated Total
Average Balances for 1Q 2014
Average earning assets		$	8,850,984		$	7,230,394		$	5,811,125		$	21,892,503
Average loans			8,843,070			7,230,394			91,153			16,164,617
Average deposits			5,241,027			9,539,887			2,209,358			16,990,272
Average allocated capital (T1CE) **		$	787,257		$	488,425		$	623,853		$	1,899,535
Average Balances for 1Q 2013
Average earning assets		$	8,156,150		$	7,298,554		$	5,226,215		$	20,680,919
Average loans			8,145,829			7,298,554			3,769			15,448,152
Average deposits			5,374,633			9,598,352			2,173,399			17,146,384
Average allocated capital (T1CE) **		$	754,004		$	543,345		$	559,082		$	1,856,431
* The consolidated credit provision is equal to the actual reported provision for credit losses.
** ROT1CE reflects return on average allocated Tier 1 common equity ("T1CE"). The ROT1CE for the Risk Management and Shared Services segment and the Consolidated Total is inclusive of the annualized effect of the preferred stock dividends.