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Allowance for Credit Losses and Credit Quality (Tables)
 9 Months Ended
Sep. 30, 2017
Receivables [Abstract]  
Schedule of Allowance for Loan Losses for Covered and Non-Covered Loan Portfolios
A summary of changes in the allowance for credit losses for the nine months ended September 30 is as follows:
 
2017
(Dollars in thousands)
Legacy Loans
 
Acquired Loans
 
Total
Allowance for credit losses
 
 
 
 
 
Allowance for loan losses at beginning of period
$
105,569

 
$
39,150

 
$
144,719

Provision for (Reversal of) loan losses
37,835

 
(1,117
)
 
36,718

Transfer of balance to OREO and other
—

 
963

 
963

Loans charged-off
(47,100
)
 
(2,839
)
 
(49,939
)
Recoveries
3,042

 
1,125

 
4,167

Allowance for loan losses at end of period
$
99,346

 
$
37,282

 
$
136,628

 
 
 
 
 
 
Reserve for unfunded commitments at beginning of period
11,241

 
—

 
11,241

     Balance created in purchase accounting
7,626

 
—

 
7,626

Provision for unfunded lending commitments
2,165

 
—

 
2,165

Reserve for unfunded commitments at end of period
21,032

 
—

 
21,032

Allowance for credit losses at end of period
$
120,378

 
$
37,282

 
$
157,660

 
2016
 
Legacy Loans
 
Acquired Loans
 
Total
Allowance for credit losses
 
 
 
 
 
Allowance for loan losses at beginning of period
$
93,808

 
$
44,570

 
$
138,378

Provision for (Reversal of) loan losses before benefit attributable to FDIC loss share agreements
40,516

 
(2,501
)
 
38,015

Adjustment attributable to FDIC loss share arrangements
—

 
1,240

 
1,240

Net provision for (Reversal of) loan losses
40,516

 
(1,261
)
 
39,255

Adjustment attributable to FDIC loss share arrangements
—

 
(1,240
)
 
(1,240
)
Transfer of balance to OREO and other
—

 
(2,045
)
 
(2,045
)
Loans charged-off
(28,559
)
 
(1,495
)
 
(30,054
)
Recoveries
3,124

 
775

 
3,899

Allowance for loan losses at end of period
$
108,889

 
$
39,304

 
$
148,193

 
 
 
 
 
 
Reserve for unfunded commitments at beginning of period
$
14,145

 
$
—

 
$
14,145

Provision for (Reversal of) unfunded lending commitments
(2,155
)
 
—

 
(2,155
)
Reserve for unfunded commitments at end of period
$
11,990

 
$
—

 
$
11,990

Allowance for credit losses at end of period
$
120,879

 
$
39,304

 
$
160,183

A summary of changes in the allowance for credit losses for legacy loans, by loan portfolio type, for the nine months ended September 30 is as follows:
 
2017
(Dollars in thousands)
Commercial Real Estate
 
Commercial and Industrial
 
Energy-related
 
Residential Mortgage
 
Consumer
 
Total
Allowance for loan losses at beginning of period
$
25,408

 
$
35,434

 
$
22,486

 
$
3,835

 
$
18,406

 
$
105,569

Provision for (Reversal of) loan losses
4,803

 
13,345

 
10,567

 
(500
)
 
9,620

 
37,835

Loans charged-off
(384
)
 
(16,882
)
 
(19,802
)
 
(158
)
 
(9,874
)
 
(47,100
)
Recoveries
325

 
474

 
—

 
83

 
2,160

 
3,042

Allowance for loan losses at end of period
$
30,152

 
$
32,371

 
$
13,251

 
$
3,260

 
$
20,312

 
$
99,346

 
 
 
 
 
 
 
 
 
 
 
 
Reserve for unfunded commitments at beginning of period
3,206

 
3,535

 
1,003

 
657

 
2,840

 
11,241

Balance created in purchase accounting
1,358

 
4,903

 
—

 
1,303

 
62

 
7,626

Provision for (Reversal of) unfunded commitments
1,237

 
485

 
269

 
(30
)
 
204

 
2,165

Reserve for unfunded commitments at end of period
$
5,801

 
$
8,923

 
$
1,272

 
$
1,930

 
$
3,106

 
$
21,032

Allowance on loans individually evaluated for impairment
1,907

 
4,604

 
5,091

 
120

 
2,369

 
14,091

Allowance on loans collectively evaluated for impairment
28,245


27,767

 
8,160

 
3,140

 
17,943

 
85,255

Loans, net of unearned income:
 
 
 
 
 
 
 
 
 
 
 
Balance at end of period
$
6,187,471

 
$
3,497,374

 
$
610,610

 
$
1,041,660

 
$
2,496,701

 
$
13,833,816

Balance at end of period individually evaluated for impairment
51,467

 
39,850

 
61,142

 
4,659

 
28,053

 
185,171

Balance at end of period collectively evaluated for impairment
6,136,004

 
3,457,524

 
549,468

 
1,037,001

 
2,468,648

 
13,648,645

 
2016
(Dollars in thousands)
Commercial Real Estate
 
Commercial and Industrial
 
Energy-related
 
Residential Mortgage
 
Consumer
 
Total
Allowance for loan losses at beginning of period
$
24,658

 
$
23,283

 
$
23,863

 
$
3,947

 
$
18,057

 
$
93,808

Provision for (Reversal of) loan losses
(651
)
 
13,201

 
18,998

 
248

 
8,720

 
40,516

Loans charged-off
(1,598
)
 
(2,418
)
 
(14,672
)
 
(240
)
 
(9,631
)
 
(28,559
)
Recoveries
766

 
251

 
—

 
142

 
1,965

 
3,124

Allowance for loan losses at end of period
$
23,175

 
$
34,317

 
$
28,189

 
$
4,097

 
$
19,111

 
$
108,889

 
 
 
 
 
 
 
 
 
 
 
 
Reserve for unfunded commitments at beginning of period
$
4,160

 
$
3,448

 
$
2,665

 
$
830

 
$
3,042

 
$
14,145

Provision for (Reversal of) unfunded commitments
(427
)
 
(46
)
 
(1,712
)
 
(148
)
 
178

 
(2,155
)
Reserve for unfunded commitments at end of period
$
3,733

 
$
3,402

 
$
953

 
$
682

 
$
3,220

 
$
11,990

Allowance on loans individually evaluated for impairment
$
655

 
$
8,996

 
$
14,396

 
$
110

 
$
1,053

 
$
25,210

Allowance on loans collectively evaluated for impairment
22,520

 
25,321

 
13,793

 
3,987

 
18,058

 
83,679

Loans, net of unearned income:
 
 
 
 
 
 
 
 
 
 
 
Balance at end of period
$
5,419,483

 
$
3,101,472

 
$
598,279

 
$
840,082

 
$
2,454,054

 
$
12,413,370

Balance at end of period individually evaluated for impairment
31,405

 
58,464

 
212,512

 
4,539

 
11,546

 
318,466

Balance at end of period collectively evaluated for impairment
5,388,078

 
3,043,008

 
385,767

 
835,543

 
2,442,508

 
12,094,904

A summary of changes in the allowance for loan losses for acquired loans, by loan portfolio type, for the nine months ended September 30 is as follows:
 
2017
(Dollars in thousands)
Commercial
Real Estate
 
Commercial
and Industrial
 
Energy-related
 
Residential
Mortgage
 
Consumer
 
Total
Allowance for loan losses at beginning of period
$
23,574

 
$
3,230

 
$
39

 
$
7,412

 
$
4,895

 
$
39,150

Provision for (Reversal of) loan losses
167

 
(338
)
 
(30
)
 
(833
)
 
(83
)
 
(1,117
)
Transfer of balance to OREO and other
879

 
(69
)
 
—

 
2

 
151

 
963

Loans charged-off
(1,026
)
 
(478
)
 
—

 
(107
)
 
(1,228
)
 
(2,839
)
Recoveries
343

 
131

 
—

 
65

 
586

 
1,125

Allowance for loan losses at end of period
$
23,937

 
$
2,476

 
$
9

 
$
6,539

 
$
4,321

 
$
37,282

Allowance on loans individually evaluated for impairment
$
50

 
$
48

 
$
—

 
$
44

 
$
76

 
$
218

Allowance on loans collectively evaluated for impairment
23,887

 
2,428

 
9

 
6,495

 
4,245

 
37,064

Loans, net of unearned income:
 
 
 
 
 
 
 
 
 
 
 
Balance at end of period
$
2,542,154

 
$
945,711

 
$
1,003

 
$
1,983,310

 
$
489,091

 
$
5,961,269

Balance at end of period individually evaluated for impairment
640

 
196

 
—

 
725

 
1,087

 
2,648

Balance at end of period collectively evaluated for impairment
2,299,819

 
913,974

 
1,003

 
1,853,205

 
408,735

 
5,476,736

Balance at end of period acquired with deteriorated credit quality
241,695

 
31,541

 
—

 
129,380

 
79,269

 
481,885

 
2016
(Dollars in thousands)
Commercial
Real Estate
 
Commercial
and Industrial
 
Energy-related
 
Residential
Mortgage
 
Consumer
 
Total
Allowance for loan losses at beginning of period
$
25,979

 
$
2,819

 
$
125

 
$
7,841

 
$
7,806

 
$
44,570

Provision for (Reversal of) loan losses
(1,952
)
 
216

 
(99
)
 
1,017

 
(443
)
 
(1,261
)
Decrease in FDIC loss share receivable
(34
)
 
(50
)
 
—

 
(833
)
 
(323
)
 
(1,240
)
Transfer of balance to OREO and other
(380
)
 
(467
)
 
—

 
28

 
(1,226
)
 
(2,045
)
Loans charged-off
(789
)
 
—

 
—

 
—

 
(706
)
 
(1,495
)
Recoveries
102

 
217

 
—

 
33

 
423

 
775

Allowance for loan losses at end of period
$
22,926

 
$
2,735

 
$
26

 
$
8,086

 
$
5,531

 
$
39,304

Allowance on loans individually evaluated for impairment
$
177

 
$
77

 
$
—

 
$
—

 
$
—

 
$
254

Allowance on loans collectively evaluated for impairment
22,749

 
2,658

 
26

 
8,086

 
5,531

 
39,050

Loans, net of unearned income:
 
 
 
 
 
 
 
 
 
 
 
Balance at end of period
$
1,261,732

 
$
361,525

 
$
1,362

 
$
430,448

 
$
456,062

 
$
2,511,129

Balance at end of period individually evaluated for impairment
5,647

 
1,926

 
—

 
—

 
679

 
8,252

Balance at end of period collectively evaluated for impairment
948,523

 
324,445

 
1,362

 
304,699

 
354,801

 
1,933,830

Balance at end of period acquired with deteriorated credit quality
307,562

 
35,154

 
—

 
125,749

 
100,582

 
569,047
Investment in Legacy and Acquired Loans by Credit Quality Indicator
The Company’s investment in loans by credit quality indicator is presented in the following tables. The tables below further segregate the Company’s loans between legacy and acquired loans. Loan premiums/discounts in the tables below represent the adjustment of acquired loans to fair value at the acquisition date, as adjusted for income accretion and changes in cash flow estimates in subsequent periods. Loan premiums/discounts include preliminary discounts recorded on acquired Sabadell United loans, which are subject to change upon receipt of final fair value estimates during the measurement period. Asset risk classifications for commercial loans reflect the classification as of September 30, 2017 and December 31, 2016. Credit quality information in the tables below includes total loans acquired (including acquired impaired loans) at the gross loan balance, prior to the application of premiums/discounts, at September 30, 2017 and December 31, 2016.
Loan delinquency is the primary credit quality indicator that the Company utilizes to monitor consumer asset quality.
 
Legacy loans
 
September 30, 2017
 
December 31, 2016
(Dollars in thousands)
Pass
 
Special Mention
 
Sub-
standard
 
Doubtful
 
Total
 
Pass
 
Special Mention
 
Sub-
standard
 
Doubtful
 
Total
Commercial real estate - construction
$
1,035,639

 
$
6,971

 
$
10,635

 
$
—

 
$
1,053,245

 
$
734,687

 
$
2,203

 
$
3,871

 
$
—

 
$
740,761

Commercial real estate - owner-occupied
1,706,933

 
62,454

 
38,283

 
—

 
1,807,670

 
1,738,024

 
17,542

 
29,058

 
—

 
1,784,624

Commercial real estate- non-owner-occupied
3,287,486

 
7,464

 
31,606

 
—

 
3,326,556

 
3,063,470

 
8,617

 
25,842

 
—

 
3,097,929

Commercial and industrial
3,401,005

 
42,747

 
50,862

 
2,760

 
3,497,374

 
3,112,300

 
29,763

 
35,199

 
17,534

 
3,194,796

Energy-related
459,526

 
51,511

 
83,926

 
15,647

 
610,610

 
242,123

 
80,084

 
225,724

 
11,358

 
559,289

Total
$
9,890,589

 
$
171,147

 
$
215,312

 
$
18,407

 
$
10,295,455

 
$
8,890,604

 
$
138,209

 
$
319,694

 
$
28,892

 
$
9,377,399

 
Legacy loans
 
September 30, 2017
 
December 31, 2016
(Dollars in thousands)
Current
 
30+ Days Past Due
 
Total
 
Current
 
30+ Days Past Due
 
Total
Residential mortgage
$
1,023,475

 
$
18,185

 
$
1,041,660

 
$
836,509

 
$
17,707

 
$
854,216

Consumer - home equity
1,866,137

 
19,089

 
1,885,226

 
1,768,763

 
14,658

 
1,783,421

Consumer - indirect automobile
73,499

 
2,666

 
76,165

 
127,054

 
3,994

 
131,048

Consumer - credit card
87,109

 
845

 
87,954

 
81,602

 
922

 
82,524

Consumer - other
442,059

 
5,297

 
447,356

 
462,650

 
3,666

 
466,316

Total
$
3,492,279

 
$
46,082

 
$
3,538,361

 
$
3,276,578

 
$
40,947

 
$
3,317,525


 
Acquired loans
 
September 30, 2017
 
December 31, 2016
(Dollars in thousands)
Pass
 
Special
Mention
 
Sub-standard
 
Doubtful
 
Premium/(Discount)
 
Total
 
Pass
 
Special
Mention
 
Sub-standard
 
Doubtful
 
Loss
 
Premium/(Discount)
 
Total
Commercial real estate - construction
$
232,608

 
$
1,590

 
$
4,259

 
$
13

 
$
6,256

 
$
244,726

 
$
46,498

 
$
459

 
$
3,118

 
$
2,574

 
$
—

 
$
8,759

 
$
61,408

Commercial real estate - owner-occupied
589,972

 
9,544

 
21,145

 
—

 
(13,825
)
 
606,836

 
426,492

 
7,664

 
17,584

 
1,356

 
—

 
(3,084
)
 
450,012

Commercial real estate- non-owner-occupied
1,712,067

 
11,011

 
28,073

 
614

 
(61,173
)
 
1,690,592

 
663,571

 
11,620

 
31,552

 
101

 
23

 
(39,335
)
 
667,532

Commercial and industrial
926,837

 
3,099

 
16,531

 
765

 
(1,521
)
 
945,711

 
323,154

 
1,416

 
27,749

 
494

 
—

 
(4,487
)
 
348,326

Energy-related
855

 
—

 
149

 
—

 
(1
)
 
1,003

 
1,910

 
—

 
—

 
—

 
—

 
(6
)
 
1,904

Total
$
3,462,339

 
$
25,244

 
$
70,157

 
$
1,392

 
$
(70,264
)
 
$
3,488,868

 
$
1,461,625

 
$
21,159

 
$
80,003

 
$
4,525

 
$
23

 
$
(38,153
)
 
$
1,529,182

 
Acquired loans
 
September 30, 2017
 
December 31, 2016
(Dollars in thousands)
Current
 
30+ Days Past Due
 
Premium (Discount)
 
Total
 
Current
 
30+ Days Past Due
 
Premium (Discount)
 
Total
Residential mortgage
$
2,002,389

 
$
71,564

 
$
(90,643
)
 
$
1,983,310

 
$
424,300

 
$
20,914

 
$
(32,030
)
 
$
413,184

Consumer - home equity
435,543

 
16,116

 
(16,652
)
 
435,007

 
377,021

 
12,807

 
(17,323
)
 
372,505

Consumer - indirect automobile
24

 
—

 
—

 
24

 
12

 
—

 
(8
)
 
4

Consumer - other
57,562

 
1,547

 
(5,049
)
 
54,060

 
58,141

 
1,423

 
(4,392
)
 
55,172

Total
$
2,495,518

 
$
89,227

 
$
(112,344
)
 
$
2,472,401

 
$
859,474

 
$
35,144

 
$
(53,753
)
 
$
840,865
Schedule of Investment in Legacy Impaired Loans
Information on the Company’s investment in legacy impaired loans, which include all TDRs and all other non-accrual loans evaluated or measured individually for impairment for purposes of determining the allowance for loan losses, is presented in the following tables as of and for the periods indicated.
 
September 30, 2017
 
December 31, 2016
 
Unpaid Principal Balance
 
Recorded Investment
 
Related Allowance
 
Unpaid Principal Balance
 
Recorded Investment
 
Related Allowance
(Dollars in thousands)
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate- construction
$
7,848

 
$
7,848

 
$
—

 
$
38

 
$
38

 
$
—

Commercial real estate- owner-occupied
20,519

 
20,372

 
—

 
4,593

 
4,593

 
—

Commercial real estate- non-owner-occupied
8,203

 
7,847

 
—

 
12,668

 
11,876

 
—

Commercial and industrial
36,253

 
21,455

 
—

 
14,202

 
13,189

 
—

Energy-related
59,152

 
36,932

 
—

 
152,424

 
143,239

 
—

Residential mortgage
1,109

 
1,109

 
—

 
—

 
—

 
—

Consumer - home equity
363

 
363

 
—

 
—

 
—

 
—

Consumer -other
—

 
—

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
With an allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate- construction
35

 
35

 
(1
)
 
—

 
—

 
—

Commercial real estate- owner-occupied
11,125

 
10,997

 
(1,161
)
 
17,580

 
17,429

 
(640
)
Commercial real estate- non-owner-occupied
4,469

 
4,368

 
(745
)
 
108

 
95

 
(1
)
Commercial and industrial
18,681

 
18,395

 
(4,604
)
 
28,829

 
28,329

 
(10,864
)
Energy-related
27,605

 
24,210

 
(5,091
)
 
53,967

 
53,088

 
(9,769
)
Residential mortgage
3,924

 
3,550

 
(120
)
 
4,627

 
4,312

 
(144
)
Consumer - home equity
24,123

 
23,648

 
(1,972
)
 
13,906

 
13,257

 
(993
)
Consumer - indirect automobile
955

 
605

 
(68
)
 
1,037

 
758

 
(114
)
Consumer - other
3,506

 
3,437

 
(329
)
 
2,447

 
2,442

 
(251
)
Total
$
227,870

 
$
185,171

 
$
(14,091
)
 
$
306,426

 
$
292,645

 
$
(22,776
)
Total commercial loans
$
193,890

 
$
152,459

 
$
(11,602
)
 
$
284,409

 
$
271,876

 
$
(21,274
)
Total mortgage loans
5,033

 
4,659

 
(120
)
 
4,627

 
4,312

 
(144
)
Total consumer loans
28,947

 
28,053

 
(2,369
)
 
17,390

 
16,457

 
(1,358
)
 
Three Months Ended
September 30, 2017
 
Three Months Ended
September 30, 2016
 
Nine Months Ended
September 30, 2017
 
Nine Months Ended
September 30, 2016
 
Average
Recorded Investment
 
Interest
Income Recognized
 
Average
Recorded Investment
 
Interest
Income Recognized
 
Average Recorded Investment
 
Interest Income Recognized
 
Average Recorded Investment
 
Interest Income Recognized
(Dollars in thousands)
 
 
 
 
 
 
 
With no related allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate- construction
$
2,722

 
$
11

 
$
—

 
$
—

 
$
2,538

 
$
57

 
$
—

 
$
—

Commercial real estate- owner-occupied
20,381

 
81

 
3,371

 
38

 
20,475

 
489

 
3,452

 
115

Commercial real estate- non-owner-occupied
7,858

 
82

 
16,974

 
182

 
7,908

 
231

 
17,182

 
548

Commercial and industrial
29,165

 
206

 
29,533

 
313

 
34,193

 
860

 
30,772

 
1,030

Energy-related
52,167

 
41

 
165,459

 
1,364

 
54,128

 
142

 
149,099

 
3,755

Residential mortgage
1,114

 
13

 
—

 
—

 
1,129

 
36

 
—

 
—

Consumer - home equity
364

 
6

 
—

 
—

 
367

 
18

 
—

 
—

With an allowance recorded:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate- construction
36

 
1

 
25

 
—

 
37

 
2

 
28

 
—

Commercial real estate- owner-occupied
11,095

 
87

 
16,470

 
137

 
11,140

 
267

 
16,335

 
409

Commercial real estate- non-owner-occupied
4,412

 
21

 
187

 
2

 
4,335

 
87

 
190

 
8

Commercial and industrial
18,718

 
258

 
30,505

 
356

 
19,643

 
776

 
37,673

 
1,166

Energy-related
36,128

 
—

 
52,536

 
367

 
37,181

 
4

 
37,192

 
1,118

Residential mortgage
3,561

 
36

 
4,572

 
43

 
3,599

 
107

 
4,632

 
134

Consumer - home equity
22,907

 
245

 
9,107

 
97

 
20,799

 
663

 
8,107

 
259

Consumer - indirect automobile
643

 
5

 
687

 
6

 
750

 
21

 
796

 
33

Consumer - other
3,387

 
54

 
1,315

 
23

 
2,957

 
144

 
998

 
55

Total
$
214,658

 
$
1,147

 
$
330,741

 
$
2,928

 
$
221,179

 
$
3,904

 
$
306,456

 
$
8,630

Total commercial loans
$
182,682

 
$
788

 
$
315,060

 
$
2,759

 
$
191,578

 
$
2,915

 
$
291,923

 
$
8,149

Total mortgage loans
4,675

 
49

 
4,572

 
43

 
4,728

 
143

 
4,632

 
134

Total consumer loans
27,301

 
310

 
11,109

 
126

 
24,873

 
846

 
9,901

 
347