FDIC SHARED-LOSS PAYABLE

BancShares completed six FDIC-assisted transactions with shared-loss agreements during the period beginning in 2009 through 2011. Prior to its merger into BancShares, Bancorporation completed three FDIC-assisted transactions with shared-loss agreements.

As of June 30, 2018, shared-loss agreements are still active for Georgian Bank (GB) and United Western Bank (UWB). Shared-loss protection remains for single family residential loans acquired from UWB and GB in the amount of $62.1 million.

The shared-loss agreements for two FDIC-assisted transactions, First Regional Bank (FRB) and UWB, include provisions related to payments that may be owed to the FDIC at the termination of the agreements (clawback liability). The clawback liability represents a payment by BancShares to the FDIC if actual cumulative losses on acquired covered assets are lower than the cumulative losses originally estimated by the FDIC at the time of acquisition and is recorded in the Consolidated Balance Sheets as a payable to the FDIC under the relevant shared-loss agreements. As of June 30, 2018 and December 31, 2017, the estimated clawback liability was $103.5 million and $101.3 million, respectively. The clawback liability payment dates for FRB and UWB are March 2020 and March 2021, respectively.

The following table provides changes in the FDIC shared-loss payable for the three and six months ended June 30, 2018 and June 30, 2017.



	Three months ended June 30				Six months ended June 30
(Dollars in thousands)	2018		2017		2018		2017
Beginning balance	$	102,466	$	98,013	$	101,342	$	97,008
Amortization	1,001		963		1,993		1,917
Adjustments related to changes in assumptions	20		150		152		201
Ending balance	$	103,487	$	99,126	$	103,487	$	99,126