Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document and Entity Information [Abstract] | |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2018 |
Amendment Flag | false |
Entity Registrant Name | Bank of N.T. Butterfield & Son Ltd |
Entity Central Index Key | 1,653,242 |
Entity Current Reporting Status | Yes |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Well Known Seasoned Issuer | Yes |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | FY |
Entity Common Stock, Shares Outstanding (in shares) | 55,359,218 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and demand deposits with banks - Non-interest bearing | $ 124,182 | $ 89,381 |
Demand deposits with banks - Interest bearing | 487,588 | 340,256 |
Cash equivalents - Interest bearing | 1,442,113 | 1,105,501 |
Cash due from banks | 2,053,883 | 1,535,138 |
Securities purchased under agreement to resell | 27,341 | 178,769 |
Short-term investments | 52,336 | 249,984 |
Investment in securities | ||
Trading | 6,495 | 6,824 |
Available-for-sale | 2,182,749 | 3,317,440 |
Held-to-maturity (fair value: $2,036,214 (2017: $1,377,354)) | 2,066,120 | 1,381,955 |
Total investment in securities | 4,255,364 | 4,706,219 |
Loans | ||
Loans | 4,068,991 | 3,812,329 |
Allowance for credit losses | (25,102) | (35,467) |
Loans, net of allowance for credit losses | 4,043,889 | 3,776,862 |
Premises, equipment and computer software | 158,060 | 164,790 |
Accrued interest | 20,870 | 24,915 |
Goodwill | 23,991 | 21,529 |
Intangible assets | 50,751 | 39,066 |
Equity method investments | 14,660 | 14,099 |
Other real estate owned | 5,346 | 9,127 |
Other assets | 66,687 | 58,739 |
Total assets | 10,773,178 | 10,779,237 |
Bank deposits | ||
Total deposits | 9,452,241 | 9,536,458 |
Employee benefit plans | 117,203 | 128,798 |
Accrued interest | 5,072 | 2,376 |
Pending payable for investments purchased | 0 | 51,913 |
Other liabilities | 172,997 | 119,811 |
Total other liabilities | 295,272 | 302,898 |
Long-term debt | 143,322 | 117,000 |
Total liabilities | 9,890,835 | 9,956,356 |
Commitments, contingencies and guarantees (Note 12) | ||
Shareholders' equity | ||
Common share capital (BMD 0.01 par; authorized voting ordinary shares 2,000,000,000 and non-voting ordinary shares 6,000,000,000) issued and outstanding: 55,359,218 (2017: 54,692,630) | 554 | 547 |
Additional paid-in capital | 1,171,435 | 1,155,542 |
Accumulated deficit | (92,676) | (204,156) |
Less: treasury common shares, at cost: 1,254,212 (2017: nil) | (48,443) | 0 |
Accumulated other comprehensive loss | (148,527) | (129,052) |
Total shareholders’ equity | 882,343 | 822,881 |
Total liabilities and shareholders’ equity | 10,773,178 | 10,779,237 |
Customers | ||
Bermuda | ||
Non-interest bearing | 1,378,539 | 1,840,201 |
Interest bearing | 3,117,063 | 3,412,623 |
Non-Bermuda | ||
Non-interest bearing | 732,957 | 639,525 |
Interest bearing | 4,189,860 | 3,631,643 |
Bank deposits | ||
Total deposits | 9,418,419 | 9,523,992 |
Banks | ||
Bank deposits | ||
Bermuda | 8,100 | 442 |
Non-Bermuda | 25,722 | 12,024 |
Total deposits | $ 33,822 | $ 12,466 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) $ in Thousands | Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($)shares |
Held-to-maturity, fair value | $ | $ 2,036,214 | $ 1,377,354 |
Common shares, issued (in shares) | 55,359,218 | 54,692,630 |
Common shares, outstanding (in shares) | 55,359,218 | 54,692,630 |
Treasury common shares, at cost (in shares) | 1,254,212 | 0 |
Voting Common Stock | ||
Common shares, authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Non-voting Common Stock | ||
Common shares, authorized (in shares) | 6,000,000,000 | 6,000,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Non-interest income | |||
Asset management | $ 25,603 | $ 24,711 | $ 21,106 |
Banking | 45,010 | 43,772 | 39,342 |
Foreign exchange revenue | 32,895 | 32,222 | 30,606 |
Trust | 51,004 | 44,936 | 44,060 |
Custody and other administration services | 9,262 | 8,149 | 8,883 |
Other non-interest income | 4,912 | 4,035 | 3,476 |
Total non-interest income | 168,686 | 157,825 | 147,473 |
Interest income | |||
Interest and fees on loans | 218,495 | 187,020 | 188,000 |
Investments (none of the investment securities are intrinsically tax-exempt) | |||
Trading | 0 | 0 | 1,725 |
Available-for-sale | 68,936 | 65,299 | 53,184 |
Held-to-maturity | 55,327 | 36,132 | 22,261 |
Deposits with banks | 24,830 | 17,178 | 9,759 |
Total interest income | 367,588 | 305,629 | 274,929 |
Interest expense | |||
Deposits | 17,617 | 10,931 | 11,831 |
Long-term debt | 6,949 | 4,954 | 4,500 |
Securities sold under repurchase agreements | 33 | 0 | 118 |
Total interest expense | 24,599 | 15,885 | 16,449 |
Net interest income before provision for credit losses | 342,989 | 289,744 | 258,480 |
Provision for credit recoveries (losses) | 6,991 | 5,837 | (4,399) |
Net interest income after provision for credit losses | 349,980 | 295,581 | 254,081 |
Net trading gains (losses) | (329) | 511 | 715 |
Net realized gains (losses) on available-for-sale investments | 1,100 | 4,186 | 1,546 |
Net gains (losses) on other real estate owned | (322) | (2,383) | (440) |
Net other gains (losses) | (1,304) | (1,045) | (807) |
Total other gains (losses) | (855) | 1,269 | 1,014 |
Total net revenue | 517,811 | 454,675 | 402,568 |
Non-interest expense | |||
Salaries and other employee benefits | 159,778 | 145,138 | 140,246 |
Technology and communications | 60,280 | 53,999 | 57,441 |
Professional and outside services | 26,034 | 27,181 | 18,851 |
Property | 21,825 | 19,878 | 21,043 |
Indirect taxes | 19,485 | 18,050 | 16,352 |
Non-service employee benefits expense | 5,570 | 8,090 | (279) |
Marketing | 6,116 | 5,739 | 4,513 |
Amortization of intangible assets | 5,091 | 4,210 | 4,514 |
Restructuring costs | 0 | 1,772 | 6,266 |
Other expenses | 17,164 | 16,279 | 16,952 |
Total non-interest expense | 321,343 | 300,336 | 285,899 |
Net income before income taxes | 196,468 | 154,339 | 116,669 |
Income tax expense | (1,284) | (1,087) | (727) |
Net income | 195,184 | 153,252 | 115,942 |
Cash dividends declared on preference shares | 0 | 0 | (13,979) |
Preference shares guarantee fee | 0 | 0 | (1,676) |
Premium paid on repurchase of preference shares | 0 | 0 | (41,913) |
Net income attributable to common shareholders | $ 195,184 | $ 153,252 | $ 58,374 |
Earnings per common share | |||
Basic earnings per share (in dollars per share) | $ 3.55 | $ 2.82 | $ 1.20 |
Diluted earnings per share (in dollars per share) | $ 3.50 | $ 2.76 | $ 1.18 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 195,184 | $ 153,252 | $ 115,942 |
Other comprehensive income (loss), net of taxes | |||
Net change in unrealized gains and losses on translation of net investment in foreign operations | (2,317) | 2,603 | (6,507) |
Accretion of net unrealized (gains) losses on held-to-maturity investments transferred from available-for-sale investments | 43 | 140 | (71) |
Net change in unrealized gains and losses on available-for-sale investments | (27,893) | 6,943 | (21,181) |
Employee benefit plans adjustments | 10,692 | 5,942 | (26,424) |
Other comprehensive income (loss), net of taxes | (19,475) | 15,628 | (54,183) |
Total comprehensive income | $ 175,709 | $ 168,880 | $ 61,759 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Accumulated other comprehensive income (loss) | Common share capital | Preference sharesClass A | Additional paid-in capital | Accumulated deficit | Treasury common shares |
Beginning balance (in shares) at Dec. 31, 2015 | 47,293,253 | 182,863 | 924,031 | ||||
Balance at beginning of year at Dec. 31, 2015 | $ (90,497) | $ 473 | $ 2 | $ 1,225,344 | $ (368,618) | $ (16,350) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Retirement of shares (in shares) | (2,393) | ||||||
Retirement of shares | $ 0 | (45) | |||||
Issuance of common shares (in shares) | 5,994,012 | ||||||
Issuance of common shares | $ 60 | 131,540 | |||||
Redemption of preference shares (in shares) | (182,863) | ||||||
Redemption of preference shares | $ (2) | (170,206) | |||||
Share-based compensation | 14,072 | ||||||
Share-based settlements | (10,626) | ||||||
Retirement of common shares | $ (41,913) | (41,913) | |||||
Repurchase of warrant | (100) | ||||||
Cost of issuance of common shares | (5,458) | ||||||
Sale of treasury common shares | 0 | ||||||
Net income for period | 115,942 | 115,942 | |||||
Common share cash dividends declared and paid, $1.52 per share (2017: $1.28 per share; 2016: $0.40 per share) | (19,346) | ||||||
Cash dividends declared on preference shares, nil per share (2017: nil per share; 2016: $80.00 per share) | (13,979) | ||||||
Preference shares guarantee fee | (1,676) | ||||||
Purchase of treasury common shares (in shares) | 97,053 | ||||||
Purchase of treasury common shares | $ (1,588) | ||||||
Sale of treasury common shares (in shares) | 0 | ||||||
Sale of treasury common shares | $ 0 | ||||||
Share-based settlements (in shares) | (1,019,016) | ||||||
Share-based settlements | $ 17,896 | ||||||
Fractional share payout (in shares) | (2) | ||||||
Other comprehensive income (loss), net of taxes | (54,183) | (54,183) | |||||
Ending balance (in shares) at Dec. 31, 2016 | 53,284,872 | 0 | 2,066 | ||||
Balance at end of year at Dec. 31, 2016 | 710,742 | (144,680) | $ 533 | $ 0 | 1,142,608 | (287,677) | $ (42) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Retirement of shares (in shares) | 0 | ||||||
Retirement of shares | $ 0 | 0 | |||||
Issuance of common shares (in shares) | 1,407,758 | ||||||
Issuance of common shares | $ 14 | 4,514 | |||||
Redemption of preference shares (in shares) | 0 | ||||||
Redemption of preference shares | $ 0 | 0 | |||||
Share-based compensation | 8,110 | ||||||
Share-based settlements | 289 | ||||||
Retirement of common shares | 0 | 0 | |||||
Repurchase of warrant | 0 | ||||||
Cost of issuance of common shares | 22 | ||||||
Sale of treasury common shares | (1) | ||||||
Net income for period | 153,252 | 153,252 | |||||
Common share cash dividends declared and paid, $1.52 per share (2017: $1.28 per share; 2016: $0.40 per share) | (69,731) | ||||||
Cash dividends declared on preference shares, nil per share (2017: nil per share; 2016: $80.00 per share) | 0 | ||||||
Preference shares guarantee fee | 0 | ||||||
Purchase of treasury common shares (in shares) | 0 | ||||||
Purchase of treasury common shares | $ 0 | ||||||
Sale of treasury common shares (in shares) | (380) | ||||||
Sale of treasury common shares | $ 13 | ||||||
Share-based settlements (in shares) | (1,686) | ||||||
Share-based settlements | $ 29 | ||||||
Fractional share payout (in shares) | 0 | ||||||
Other comprehensive income (loss), net of taxes | 15,628 | 15,628 | |||||
Ending balance (in shares) at Dec. 31, 2017 | 54,692,630 | 0 | 0 | ||||
Balance at end of year at Dec. 31, 2017 | 822,881 | (129,052) | $ 547 | $ 0 | 1,155,542 | (204,156) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Retirement of shares (in shares) | 0 | ||||||
Retirement of shares | $ 0 | 0 | |||||
Issuance of common shares (in shares) | 666,588 | ||||||
Issuance of common shares | $ 7 | 3,311 | |||||
Redemption of preference shares (in shares) | 0 | ||||||
Redemption of preference shares | $ 0 | 0 | |||||
Share-based compensation | 11,664 | ||||||
Share-based settlements | 918 | ||||||
Retirement of common shares | 0 | 0 | |||||
Repurchase of warrant | 0 | ||||||
Cost of issuance of common shares | 0 | ||||||
Sale of treasury common shares | 0 | ||||||
Net income for period | 195,184 | 195,184 | |||||
Common share cash dividends declared and paid, $1.52 per share (2017: $1.28 per share; 2016: $0.40 per share) | (83,704) | ||||||
Cash dividends declared on preference shares, nil per share (2017: nil per share; 2016: $80.00 per share) | 0 | ||||||
Preference shares guarantee fee | 0 | ||||||
Purchase of treasury common shares (in shares) | 1,254,212 | ||||||
Purchase of treasury common shares | $ (48,443) | ||||||
Sale of treasury common shares (in shares) | 0 | ||||||
Sale of treasury common shares | $ 0 | ||||||
Share-based settlements (in shares) | 0 | ||||||
Share-based settlements | $ 0 | ||||||
Fractional share payout (in shares) | 0 | ||||||
Other comprehensive income (loss), net of taxes | (19,475) | (19,475) | |||||
Ending balance (in shares) at Dec. 31, 2018 | 55,359,218 | 0 | 1,254,212 | ||||
Balance at end of year at Dec. 31, 2018 | $ 882,343 | $ (148,527) | $ 554 | $ 0 | $ 1,171,435 | $ (92,676) | $ (48,443) |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Common share cash dividends paid (in dollars per share) | $ 1.52 | $ 1.28 | $ 0.4 |
Accumulated deficit | |||
Common share cash dividends declared (in dollars per share) | 1.52 | 1.28 | 0.40 |
Common share cash dividends paid (in dollars per share) | 1.52 | 1.28 | |
Cash dividends declared on preference shares (in dollars per share) | $ 0 | $ 0 | $ 80 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities | |||
Net income | $ 195,184 | $ 153,252 | $ 115,942 |
Adjustments to reconcile net income to operating cash flows | |||
Depreciation and amortization | 46,476 | 50,398 | 52,261 |
Provision for credit (recovery) losses | (6,991) | (5,837) | 4,399 |
Share-based payments and settlements | 12,582 | 8,410 | 14,423 |
Net realized (gains) losses on available-for-sale investments | (1,100) | (4,186) | (1,546) |
(Gain) loss on sale of premises and equipment | 0 | 0 | (37) |
Net (gains) losses on other real estate owned | 322 | 2,383 | 440 |
(Increase) decrease in carrying value of equity method investments | (1,118) | (1,028) | (1,137) |
Dividends received from equity method investments | 556 | 412 | 441 |
Fair value adjustments of a contingent payment | 0 | 0 | 895 |
Changes in operating assets and liabilities | |||
(Increase) decrease in accrued interest receivable | 3,838 | (1,761) | (6,054) |
(Increase) decrease in other assets | (7,813) | 25,600 | (6,694) |
Increase (decrease) in accrued interest payable | 2,774 | 82 | (284) |
Increase (decrease) in employee benefit plans and other liabilities | 51,635 | 14,396 | 5,587 |
Cash provided by (used in) operating activities | 296,345 | 242,121 | 178,636 |
Cash flows from investing activities | |||
(Increase) decrease in securities purchased under agreement to resell | 151,428 | (29,956) | (148,813) |
Net (increase) decrease in short-term investments other than restricted cash | 188,115 | 277,788 | (122,323) |
Net change in trading investments | 329 | (511) | 314,986 |
Available-for-sale investments: proceeds from sale | 854,160 | 213,047 | 60,548 |
Available-for-sale investments: proceeds from maturities and pay downs | 480,765 | 524,971 | 576,892 |
Available-for-sale investments: purchases | (242,087) | (730,765) | (1,884,554) |
Held-to-maturity investments: proceeds from maturities and pay downs | 166,406 | 113,573 | 73,725 |
Held-to-maturity investments: purchases | (903,958) | (385,813) | (360,959) |
Net (increase) decrease in loans | (321,944) | (130,107) | 321,722 |
Additions to premises, equipment and computer software | (18,529) | (19,218) | (9,804) |
Proceeds from sale of other real estate owned | 5,896 | 2,689 | 5,528 |
Purchase of intangible assets | (1,308) | 0 | 0 |
Net cash disbursed for business acquisitions | (20,722) | 0 | (21,778) |
Cash provided by (used in) investing activities | 338,551 | (164,302) | (1,194,830) |
Cash flows from financing activities | |||
Net increase (decrease) in demand and term deposit liabilities | (22,543) | (621,105) | 1,056,029 |
Proceeds from issuance of common shares, net of underwriting discounts and commissions | 0 | 13 | 131,600 |
Cost of issuance of common shares | 0 | 0 | (5,458) |
Proceeds from loans sold under agreement to repurchase | 0 | 0 | 5,152 |
Cost of repurchase of loans under agreement to repurchase | 0 | 0 | (5,152) |
Issuance of subordinated capital, net of underwriting fees | 73,218 | 0 | 0 |
Repayment of long-term debt | (47,000) | 0 | 0 |
Common shares repurchased | (48,443) | 0 | (1,633) |
Preference shares repurchased | 0 | 0 | (212,121) |
Warrant repurchased | 0 | 0 | (100) |
Proceeds from stock option exercises | 3,318 | 4,546 | 6,919 |
Cash dividends paid on common shares | (83,704) | (69,731) | (19,346) |
Cash dividends paid on preference shares | 0 | 0 | (14,629) |
Preference shares guarantee fee paid | 0 | 0 | (1,676) |
Cash provided by (used in) financing activities | (125,154) | (686,277) | 939,585 |
Net effect of exchange rates on cash, cash equivalent and restricted cash | 2,646 | 46,645 | (105,245) |
Net increase (decrease) in cash, cash equivalent and restricted cash | 512,388 | (561,813) | (181,854) |
Cash, cash equivalent and restricted cash: beginning of year | 1,557,732 | 2,119,545 | 2,301,399 |
Cash, cash equivalent and restricted cash: end of year | 2,070,120 | 1,557,732 | 2,119,545 |
Components of cash, cash equivalent and restricted cash at end of year | |||
Total cash, cash equivalent and restricted cash at end of year | 1,557,732 | 2,119,545 | 2,301,399 |
Supplemental disclosure of cash flow information | |||
Cash interest paid | 27,374 | 15,968 | 16,165 |
Cash income tax paid | 544 | 696 | 391 |
Non-cash items | |||
Transfer to other real estate owned | 2,437 | 0 | 8,961 |
Transfer of available-for-sale investments to held-to-maturity investments | $ 0 | $ 0 | $ 74,731 |
Nature of business
Nature of business | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of business | Note 1: Nature of business The Bank of N.T. Butterfield & Son Limited (“Butterfield”, the “Bank” or the “Company”) is incorporated under the laws of Bermuda and has a banking license under the Banks and Deposit Companies Act, 1999 (“the Act”). Butterfield is regulated by the Bermuda Monetary Authority (“BMA”), which operates in accordance with Basel principles. Butterfield is a full service bank and wealth manager headquartered in Hamilton, Bermuda. The Bank operates its business through three geographic segments: Bermuda, the Cayman Islands, and the Channel Islands and the United Kingdom (UK), where its principal banking operations are located and where it offers specialized financial services. Butterfield offers banking services, comprised of retail and corporate banking, and wealth management, which consists of trust, private banking, and asset management. In the Bermuda and Cayman Islands segments, Butterfield offers both banking and wealth management. In the Channel Islands and the UK segment, the Bank offers wealth management and residential property lending. On September 16, 2016, the Bank's common shares began to trade on the New York Stock Exchange under the symbol "NTB". On September 21, 2016, the Bank completed its offering of 5,957,447 common shares, at $23.50 per share. The proceeds, net of the underwriting discounts and commissions, were $131.6 million . |
Significant accounting policies
Significant accounting policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant accounting policies | Note 2: Significant accounting policies A. Basis of Presentation and Use of Estimates and Assumptions The accounting and financial reporting policies of the Bank and its subsidiaries conform to generally accepted accounting principles in the United States of America (“GAAP”). The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the year, and actual results could differ from those estimates. Critical accounting estimates are those that require management to make subjective or complex judgments about the effect of matters that are inherently uncertain and may change in subsequent periods. Changes that may be required in the underlying assumptions or estimates in these areas could have a material impact on the future financial condition and results of operations. Management believes that the most critical accounting policies upon which the financial condition depends, and which involve the most complex or subjective decisions or assessments, are as follows: • Allowance for credit losses • Fair value and impairment of financial instruments • Impairment of long-lived assets • Impairment of goodwill • Employee benefit plans • Share-based payments Beginning on January 1, 2016, the Bank's financial statements for periods presented are reported in United States ("US") dollars (previously in Bermuda dollars) to increase comparability of the Bank's financial position and results with market peers. Assets, liabilities, revenues and expenses denominated in Bermuda dollars are translated to US dollars at par and consequently, no amounts presented in the financial statements have changed as a result of this change in reporting currency. B. Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries (collectively the “Bank”), and those variable interest entities (“VIEs”) where the Company is the primary beneficiary. Intercompany accounts and transactions have been eliminated. VIEs are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity. The Bank is deemed to have a controlling financial interest and is the primary beneficiary of a VIE if it has both the power to direct the activities of the VIE that most significantly impact the VIE economic performance and an obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. The determination of whether the Bank meets the criteria to be considered the primary beneficiary of a VIE requires a periodic evaluation of all transactions (such as investments, loans and fee arrangements) with the entity. The Bank performs on-going reassessments of: (1) whether entities previously evaluated under the majority voting-interest framework have become VIEs, based on certain events, and are therefore subject to the VIE consolidation framework; and (2) whether changes in the facts and circumstances regarding the Bank’s involvement with a VIE cause the Bank’s consolidation conclusion to change. Certain Bank sponsored asset management funds are structured as limited partnerships or limited companies (collectively the “funds”). The funds have various investment strategies (including but not limited to fixed income, equities and fund of funds) and are financed by non-affiliated investors. A subsidiary of the Bank is either the general partner or investment manager to the funds but does not have any significant variable interests in these entities. For those funds where the non-affiliated investors have the ability to remove the subsidiary of the Bank as the general partner or investment manager without cause (i.e. kick out rights), based on a simple majority vote, or the non-affiliated investors have rights to participate in important decisions, the Bank does not consolidate such voting interest entities. In cases where the non-affiliated investors do not have substantive kickout or participating rights, the Bank evaluates the funds as VIEs and consolidates if it is the general partner or investment manager and has a potentially significant interest. During the three years ended December 31, 2018, 2017 and 2016, the Bank had no interests in VIEs where the Bank was considered the primary beneficiary, nor did the Bank have any significant variable interests in a VIE where the Bank was not considered the primary beneficiary. For the variable interests the Bank holds in entities which are not considered VIEs, the Bank utilized the majority voting interest framework. The Bank consolidates these entities where it holds, directly or indirectly, more than 50% of the voting rights or where it exercises control. Entities where the Bank holds 20% to 50% of the voting rights and/or has the ability to exercise significant influence, other than investments in designated VIEs, are accounted for under the equity method, and the pro rata share of their income (loss) is included in other non-interest income. C. Foreign Currency Translation Assets, liabilities, revenues and expenses denominated in Bermuda dollars are translated to United States ("US") dollars at par. Assets and liabilities of the parent company arising from other foreign currency transactions are translated into US dollars at the rates of exchange prevailing at the balance sheet date. The resulting gains or losses are included in foreign exchange revenue in the consolidated statements of operations. The assets and liabilities of foreign currency-based subsidiaries are translated at the rate of exchange prevailing on the balance sheet date, while associated revenues and expenses are translated to US dollars at the average rates of exchange prevailing throughout the year. Unrealized translation gains or losses on investments in foreign currency- based subsidiaries are recorded as a separate component of Shareholders' equity within accumulated other comprehensive loss (“AOCL”). Gains and losses on foreign currency-based subsidiaries are recorded in the consolidated statements of operations when the Bank ceases to have a controlling financial interest in a foreign currency-based subsidiary. D. Assets Held in Trust or Custody Securities and properties (other than cash and deposits held with the Bank and its subsidiaries) held in trust, custody, agency or fiduciary capacity for customers are not included in the consolidated balance sheets because the Bank is not the beneficiary of these assets. E. Cash Due from Banks Cash due from banks include cash on hand, cash items in the process of collection, amounts due from correspondent banks and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in fair value. Such investments are those with less than three months’ maturity from the date of acquisition and include unrestricted term deposits, certificates of deposit and treasury bills. F. Securities Purchased Under Agreement to Resell Securities purchased under agreement to resell are treated as collateralized lending transactions. The obligation to resell is recorded at the value of the cash paid on purchase adjusted for the amortization of the difference between the purchase price and the agreed resell price. The amortization of this amount is recorded as interest income. G. Short-Term Investments Short-term investments have maturities of less than one year from the date of acquisition, are only subject to an insignificant risk of change in fair value and comprise (1) restricted term and demand deposits, and (2) unrestricted term deposits, certificate of deposits and treasury bills with a maturity greater than three months from the date of acquisition. H. Investments Investments securities are classified as trading, available-for-sale (“AFS”) or held-to-maturity (“HTM”). Investments are classified as trading when management has the intent to sell these investments either for profit or to invest the cash received by taking customer deposits in foreign currencies. Debt and equity securities classified as trading investments are carried at fair value in the consolidated balance sheets, with unrealized gains and losses included in the consolidated statements of operations as net realized / unrealized gains (losses) on trading investments. Investments are classified primarily as AFS when used to manage the Bank’s exposure to interest rate and liquidity movements, as well as to make strategic longer-term investments. AFS investments are carried at fair value in the consolidated balance sheets with unrealized gains and losses reported as net increase or decrease to accumulated other comprehensive loss ("AOCL"). Investments that the Bank has the positive intent and ability to hold to maturity are classified as HTM and are carried at amortized cost in the consolidated balance sheets. Unrecognized gains and losses on HTM securities are disclosed in the notes to the consolidated financial statements. The specific identification method is used to determine realized gains and losses on trading and AFS investments, which are included in net realized gains and losses on AFS investments, in the consolidated statements of operations. Dividend and interest income, including amortization of premiums and discounts, on securities for which cash flows are not considered uncertain are included in interest income in the consolidated statements of operations. For securities with uncertain cash flows, the investments are accounted for under the cost recovery method, whereby all principal and coupon payments received are applied as a reduction of the amortized cost and carrying amount. Accrual of income is suspended in respect of debt securities that are in default, or from which it is unlikely that future interest payments will be received as scheduled. Contained within other assets are investments in private equity for which the Bank does not have sufficient rights or ownership interests to follow the equity method of accounting. Unquoted equity investments which are held directly by the Bank and which do not have readily determinable fair values are recorded at cost and reviewed for impairment if indicators of impairment exist. Equity method investments which include investments whereby the Bank has the ability to influence, but not control, the financial or operating policies of such entities, are accounted for using the equity method of accounting. The Bank has reclassified dividends received from affiliates from investing activities to operating activities in the consolidated statements of cash flows. Recognition of other-than-temporary impairments For debt securities, management considers a decline in fair value to be other-than-temporary when it does not expect to recover the entire amortized cost basis of the security. Investments in debt securities in unrealized loss positions are analyzed as part of management’s ongoing assessment of other-than-temporary impairment (“OTTI”). When management intends to sell such securities or it is more likely than not that the Bank will be required to sell the securities before recovering the amortized cost, it recognizes an impairment loss equal to the full difference between the amortized cost basis and the fair value of those securities. When management does not intend to sell or it is more likely than not that the Bank will hold such securities until recovering the amortized cost, management determines whether any credit losses exist to identify any OTTI. Under certain circumstances, management will perform a qualitative determination and consider a variety of factors, including the length of time and extent to which the fair value has been less than cost; adverse conditions specifically related to the industry, geographic area or financial condition of the issuer or underlying collateral of a security; payment structure of the security; changes to the rating of the security by a rating agency; the volatility of the fair value changes; and changes in fair value of the security after the balance sheet date. Alternatively, management estimates cash flows over the remaining lives of the underlying security to assess whether credit losses exist. In situations where there is a credit loss, only the amount of impairment relating to credit losses on AFS and HTM investments is recognized in net income. For AFS investments, the decrease in fair value relating to factors other than credit losses is recognized in AOCL. Cash flow estimates take into account expectations of relevant market and economic data as of the end of the reporting period, including, for example, underlying loan-level data, and structural features of securitization, such as subordination, excess spread, over collateralization or other forms of credit enhancement. The degree of judgment involved in determining the recoverable value of an investment security is dependent upon the availability of observable market prices or observable market parameters. When observable market prices and parameters do not exist, judgment is necessary to estimate recoverable value which gives rise to added uncertainty in the assessment. The assessment takes into consideration factors such as interest rate changes, movements in credit spreads, default rate assumptions, prepayment assumptions, type and quality of collateral, and market sentiment. Management's fair valuations may include inputs and assumptions that are less observable or require greater estimation, thereby resulting in values which may be greater or lower than the actual value at which the investments may be ultimately sold or the ultimate cash flows that may be recovered. If the assumptions on which management based its fair valuations change, the Bank may experience additional OTTI or realized losses or gains, and the period-to-period changes in value could vary significantly. I. Loans Loans are reported as the principal amount outstanding, net of allowance for credit losses, unearned income, fair value adjustments arising from hedge accounting and net deferred loan fees. Interest income is recognized over the term of the loan using the effective interest method, or on a basis approximating a level rate of return over the term of the loan, except for loans classified as non-accrual. Prepayments are treated as a reduction of principal outstanding which is recognized upon receipt of payment. Prepayment penalties, if applicable under the terms of the specific loan agreement, are recognized also upon receipt of payment. Acquired loans Acquired loans are recorded at fair value at the date of acquisition. No allowance for credit losses is recorded on the acquisition date as the fair value of the acquired assets incorporates assumptions regarding credit risk. Acquired loans with evidence of credit quality deterioration for which it is probable that the Bank will not receive all contractually required payments receivable are accounted for as purchased credit-impaired loans. Generally, acquired loans that meet the Bank's definition for non-accrual status are considered to be credit-impaired. The excess of the cash flows expected to be collected on purchased credit-impaired loans, measured as of the acquisition date, over the estimated fair value is referred to as the accretable yield and is recognized in interest income over the remaining life of the loan using an effective yield methodology. The difference between contractually required payments as of the acquisition date and the cash flows expected to be collected is referred to as the non-accretable difference which is included as a reduction of the carrying amount of the purchased credit-impaired loans. The Bank evaluates at each balance sheet date the estimated cash flows and corresponding carrying value of purchased credit-impaired loans in the same manner as for the measurement of impaired loans, as is described below. The Bank evaluates at each balance sheet date whether the carrying value of its purchased credit-impaired loans has decreased and if so, recognizes an allowance for credit losses in its consolidated statements of operations. For any increases in cash flows expected to be collected, the Bank adjusts any prior recorded allowance for purchased credit-impaired loans first, and then the amount of accretable yield recognized on a prospective basis over the purchased credit-impaired loan’s remaining life. Purchased credit-impaired loans are not considered non-performing and continue to have an accretable yield as long as there is a reasonable expectation about the timing and amount of cash flows expected to be collected. Impaired loans A loan is considered to be impaired when, based on current information and events, the Bank determines that it will not be able to collect all amounts due according to the original loan contract, including scheduled interest payments. Impaired loans include all non-accruing loans and all loans modified in a troubled debt restructuring (‘‘TDR’’) even if full collectability is expected following the restructuring. When a loan is identified as impaired, the impairment is measured based on the present value of expected future cash flows, discounted at the loan’s effective interest rate, except when the sole (remaining) source of repayment for the loan is the operation or liquidation of the collateral. In these cases the current fair value of the collateral, less selling costs, is used instead of discounted cash flows. If the Bank determines that the expected realizable value of the impaired loan is less than the recorded investment in the loan (net of previous charge-offs, deferred loan fees or costs and unamortized premium or discount), impairment is recognized through an allowance estimate. If the Bank determines that part of the allowance is uncollectible, that amount is charged off. Non-accrual Commercial, commercial real estate and consumer loans (excluding credit card consumer loans) are placed on non-accrual status generally if: • in the opinion of management, full payment of principal or interest is in doubt; or • principal or interest is 90 days past due. Residential mortgages are placed on non-accrual status immediately if: • in the opinion of management, full payment of principal or interest is in doubt; or • when principal or interest is 90 days past due, unless the loan is well secured and any ongoing collection efforts are reasonably expected to result in repayment of all amounts due under the contractual terms of the loan. Interest income on non-accrual loans is recognized only to the extent it is received in cash. Cash received on non-accrual loans where there is no doubt regarding full repayment (no impairment recognized in the form of a specific allowance) is first applied as repayment of the past due principal amount of the loan and secondly to past due interest and fees. Where there is doubt regarding the ultimate full repayment of the non-accrual loan (impairment recognized in the form of a specific allowance), all cash received is applied to reduce the principal amount of the loan. Interest income on these loans is recognized only after the entire balance receivable is recovered and interest is actually received. Loans are returned to accrual status when: • none of the principal or accrued interest is past due (with certain exceptions as noted below) and the Bank expects repayment of the remaining contractual obligation; or • when the loan becomes well secured and in the process of collection. Loans modified in a troubled debt restructuring ("TDR") A modification of a loan constitutes a TDR when a borrower is experiencing financial difficulty and the modification constitutes a concession from originally agreed terms. If a restructuring is considered a TDR, the Bank is required to make certain disclosures in the notes of the consolidated financial statements and individually evaluate the restructured loan for impairment. The Bank employs various types of concessions when modifying a loan that it would not otherwise consider which may include extension of repayment periods, interest rate reductions, principal or interest forgiveness, forbearance, and other actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral. Commercial and industrial loans modified in a TDR often involve temporary interest-only payments, term extensions, and converting revolving credit lines to term loans. Additional collateral, a co-borrower, or a guarantor is often requested. Commercial mortgage and construction loans modified in a TDR often involve extending the maturity date at an interest rate lower than the current market rate for new debt with similar risk, or substituting or adding a new borrower or guarantor. Construction loans modified in a TDR may also involve extending the interest-only payment period. Residential mortgage modifications generally involve a short-term forbearance period after which the missed payments are added to the end of the loan term, thereby extending the maturity date. Interest continues to accrue on the missed payments and as a result, the effective yield on the mortgage remains unchanged. As the forbearance period usually involves an insignificant payment delay they typically do not meet the reporting criteria for a TDR. Automobile loans modified in a TDR are primarily composed of loans where the Bank has lowered monthly payments by extending the term. When a loan undergoes a TDR, the determination of the loan's accrual versus non-accrual status following the modification depends on several factors. As with the risk rating process, the accrual status decision for such a loan is a separate and distinct process from the loan's TDR analysis and determination. Management considers the following in determining the accrual status of restructured loans: • If the loan was appropriately on accrual status prior to the restructuring, the borrower has demonstrated performance under the previous terms, and the Bank's credit evaluation shows the borrower's capacity to continue to perform under the restructured terms (both principal and interest payments), it is likely that the appropriate conclusion is for the loan to remain on accrual at the time of the restructuring. This evaluation must include consideration of the borrower's sustained historical repayment performance for a reasonable period prior to the date on which the loan was restructured. A sustained period of repayment performance generally would be a minimum of six months and would involve payments of cash or cash equivalents; or • If the loan was on non-accrual status before the restructuring, but the Bank's credit evaluation shows the borrower's capacity to meet the restructured terms, the loan would likely remain as non-accrual until the borrower has demonstrated a reasonable period of sustained repayment performance. As noted above, this period generally would be at least six months (thereby providing reasonable assurance as to the ultimate collection of principal and interest in full under the modified terms). Sustained performance before the restructuring may be taken into account. Loans that have been modified in a TDR are restored to accrual status only when interest and principal payments are brought current for a continuous period of six months under the modified terms. However, performance prior to the modification, or significant events that coincide with the modification, are included in assessing whether the borrower can meet the new terms and may result in the loan being returned to accrual status at the time of loan modification or after a shorter performance period. If the borrower’s ability to meet the revised payment schedule is uncertain, the loan remains on non-accrual status. A loan that is modified in a TDR prior to becoming impaired will be left on accrual status if full collectability in accordance with the restructured terms is expected. The Bank works with its customers in these difficult economic times and may enter into a TDR for loans that are in default, or at risk of defaulting, even if the loan is not impaired. A loan that had previously been modified in a TDR and is subsequently refinanced under current underwriting standards at a market rate with no concessionary terms is accounted for as a new loan and is no longer reported as a TDR. Delinquencies The entire balance of an account is contractually delinquent if the minimum payment of principal or interest is not received by the specified due date. Delinquency is reported on loans that are more than 30 days past due. Charge-offs The Bank recognizes charge-offs when it determines that loans are uncollectible, and this generally occurs when all commercially reasonable means of recovering the loan balance have been exhausted. Commercial and consumer loans are either fully or partially charged-off down to the fair value of collateral securing the loans when: • management judges the loan to be uncollectible; • repayment is expected to be protracted beyond reasonable time frames; • the asset has been classified as a loss by either the Bank’s internal loan review process or third party appraisers; or • the customer has filed bankruptcy and the loss becomes evident owing to a lack of assets or cash flow. The outstanding balance of commercial and consumer real estate secured loans and residential mortgages that are in excess of the estimated property value, less costs to sell, is charged-off once there is reasonable assurance that such excess outstanding balance is not recoverable. Credit card consumer loans that are contractually 180 days past due and other consumer loans with an outstanding balance under $100,000 that are contractually 180 days past due are generally written off and reported as charge-offs. J. Allowance for Credit Losses The Bank maintains an allowance for credit losses, which in management’s opinion is adequate to absorb all estimated credit-related losses that are incurred in its lending and off-balance sheet credit-related arrangements at the balance sheet date. The allowance for credit losses consists of specific allowances and a general allowance as follows: Specific allowances Specific allowances are determined on an exposure-by-exposure basis and reflect the associated estimated credit loss. The specific allowance for credit loss is computed as the difference between the recorded investment in the loan and the present value of expected future cash flows from the loan. The effective rate of return on the loan is used for discounting the cash flows. However, when foreclosure of a collateral-dependent loan is probable, the Bank measures impairment based on the fair value of the collateral. The Bank considers estimated costs to sell, on a discounted basis, in the measurement of impairment if those costs are expected to reduce the cash flows available to repay or otherwise satisfy the loan. If the measurement of an impaired loan is less than the recorded investment in the loan, then the Bank recognizes impairment by creating an allowance with a corresponding charge to provision for credit losses. For all commercial and commercial real estate TDRs, the Bank conducts further analysis to determine the probable amount of loss and establishes a specific allowance for the loan, if appropriate. The Bank estimates the impairment amount by comparing the loan’s carrying amount to the estimated present value of its future cash flows or the fair value of its underlying collateral. For collateral-dependent impaired commercial and commercial real estate loans, the excess of the Company’s recorded investment in the loan over the fair value of the collateral, less cost to sell, is charged off to the specific allowance. For consumer and residential mortgage TDRs that are not collateral-dependent, allowances are developed using the present value of expected future cash flows, compared to the recorded investment in the loans. Expected re-default factors are considered in this analysis. The fair value of collateral is periodically monitored subsequent to the modification. General allowances The allowance for credit losses attributed to the remaining portfolio is established through various analyzes that estimate the incurred loss at the balance sheet date inherent in the lending and off-balance sheet credit-related arrangements portfolios. These analyzes may consider historical default rates, geographic, industry, and other environmental factors. Management may also consider overall portfolio indicators including trends in internally risk rated exposures, cash-basis loans, historical and forecasted write-offs, and a review of industry, geographic and portfolio concentrations, including current developments within those segments. In addition, management may consider the current business strategy and credit process, including limit setting and compliance, credit approvals, loan underwriting criteria and loan workout procedures. Each portfolio of smaller balance, homogeneous loans, including consumer installment, revolving credit, and most other consumer loans, is collectively evaluated for impairment. The allowance for credit losses attributed to these loans is established via a process that estimates the probable losses inherent and incurred in the portfolio, based upon various analyzes. Management may consider overall portfolio indicators including historical credit losses; delinquent (defined as loans that are more than 30 days past due), non-performing, and classified loans; trends in volumes and terms of loans; an evaluation of overall credit quality; the credit process, including lending policies and procedures; and economic, geographical, product, and other environmental factors. K. Business Combinations, Goodwill and Intangible Assets All business combinations are accounted for using the acquisition method. Identifiable intangible assets (mostly customer relationships) are recognized separately from goodwill and are initially valued at fair value using discounted cash flow calculations and other recognized valuation techniques. Goodwill represents the excess of the fair value of the consideration paid for the acquisition of a business over the fair value of the net assets acquired. Contingent purchase consideration is measured at its fair value and recorded on the purchase date. Any subsequent changes in the fair value of a contingent consideration liability will be recorded through the consolidated statements of operations. Goodwill is tested annually for impairment at the reporting unit level, or more frequently if events or circumstances indicate there may be impairment. If the carrying amount of a reporting unit, including the allocated goodwill, exceeds its fair value, goodwill impairment is measured as the excess of the carrying amount of the reporting unit's allocated goodwill over the implied fair value of the goodwill. Other acquired intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives, not exceeding 15 years. Intangible assets' estimated lives are re-evaluated annually and an impairment test is carried out if certain indicators of impairment exist. L. Premises, Equipment and Computer Software Land is carried at cost. Buildings, equipment and computer software, including leasehold improvements, are carried at cost less accumulated depreciation. The Bank generally computes depreciation using the straight-line method over the estimated useful life of an asset, which is 50 years for buildings, and three to 10 years for other equipment. For leasehold improvements the Bank uses the straight-line method over the lesser of the remaining term of the leased facility or the estimated economic life of the improvement. The Bank capitalizes certain costs, including interest cost incurred during the development phase, associated with the acquisition or development of internal use software. Once the software is ready for its intended use, these costs are amortized on a straight-line basis over the software's expected useful life, which is |
Cash due from banks
Cash due from banks | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash due from banks | Note 3: Cash due from banks December 31, 2018 December 31, 2017 Bermuda Non-Bermuda Total Bermuda Non-Bermuda Total Non-interest bearing Cash and demand deposits with banks 21,677 102,505 124,182 24,189 65,192 89,381 Interest bearing¹ Demand deposits with banks 335,841 151,747 487,588 215,363 124,893 340,256 Cash equivalents 364,714 1,077,399 1,442,113 330,247 775,254 1,105,501 Sub-total - Interest bearing 700,555 1,229,146 1,929,701 545,610 900,147 1,445,757 Total cash due from banks 722,232 1,331,651 2,053,883 569,799 965,339 1,535,138 ¹ Interest bearing cash due from banks includes certain demand deposits with banks as at December 31, 2018 in the amount of $204.2 million ( December 31, 2017 : $203.3 million ) that are earning interest at a negligible rate. |
Short-term investments
Short-term investments | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Short-term investments | Note 4: Short-term investments December 31, 2018 December 31, 2017 Bermuda Non-Bermuda Total Bermuda Non-Bermuda Total Unrestricted Maturing within three months — 25,459 25,459 67,528 71,986 139,514 Maturing between three to six months — 9,641 9,641 19,841 67,035 86,876 Total unrestricted short-term investments — 35,100 35,100 87,369 139,021 226,390 Affected by drawing restrictions related to minimum reserve and derivative margin requirements Non-interest earning demand deposits — 2,401 2,401 — — — Interest earning demand and term deposits 13,836 999 14,835 22,053 1,541 23,594 Total restricted short-term investments 13,836 3,400 17,236 22,053 1,541 23,594 Total short-term investments 13,836 38,500 52,336 109,422 140,562 249,984 |
Investment in securities
Investment in securities | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment in securities | Note 5: Investment in securities Amortized Cost, Carrying Amount and Fair Value On the consolidated balance sheets, trading and available-for-sale ("AFS") investments are carried at fair value and held-to-maturity ("HTM") investments are carried at amortized cost. December 31, 2018 December 31, 2017 Amortized Gross Gross Fair value Amortized Gross Gross Fair value Trading Mutual funds 5,724 1,176 (405 ) 6,495 5,724 1,616 (516 ) 6,824 Total trading 5,724 1,176 (405 ) 6,495 5,724 1,616 (516 ) 6,824 Available-for-sale US government and federal agencies 1,820,808 3,355 (37,656 ) 1,786,507 2,720,581 8,924 (20,401 ) 2,709,104 Non-US governments debt securities 25,804 19 (398 ) 25,425 26,516 118 (386 ) 26,248 Corporate debt securities 80,177 — (1,464 ) 78,713 243,999 153 (780 ) 243,372 Asset-backed securities - Student loans 13,290 — (664 ) 12,626 13,290 — (797 ) 12,493 Commercial mortgage-backed securities 125,806 6 (2,603 ) 123,209 142,740 56 (1,296 ) 141,500 Residential mortgage-backed securities 160,492 — (4,223 ) 156,269 186,049 309 (1,635 ) 184,723 Total available-for-sale 2,226,377 3,380 (47,008 ) 2,182,749 3,333,175 9,560 (25,295 ) 3,317,440 Held-to-maturity¹ US government and federal agencies 2,066,120 5,012 (34,918 ) 2,036,214 1,381,955 4,813 (9,414 ) 1,377,354 Total held-to-maturity 2,066,120 5,012 (34,918 ) 2,036,214 1,381,955 4,813 (9,414 ) 1,377,354 ¹ For the years ended December 31, 2018 , 2017 and 2016 , non-credit impairments recognized in accumulated other comprehensive loss ("AOCL") for HTM investments were nil . Investments with Unrealized Loss Positions The Bank does not believe that the AFS and HTM investment securities that were in an unrealized loss position as of December 31, 2018 (and December 31, 2017 ), which were composed of 198 securities representing 75% of the AFS and HTM portfolios' fair value ( December 31, 2017 : 161 and 59% , respectively), represent an OTTI. Total gross unrealized losses were 2.6% of the fair value of affected securities ( December 31, 2017 : 1.3% ) and were attributable primarily to changes in market interest rates, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities. The following describes the processes for identifying credit impairment in security types with the most significant unrealized losses as shown in the preceding tables. Management believes that all the US government and federal agencies securities do not have any credit losses, given the explicit and implicit guarantees provided by the US federal government. Management believes that all the Non-US governments debt securities do not have any credit losses, given the explicit guarantee provided by the issuing government. The unrealized losses in Corporate debt securities relate primarily to six debt securities that are all of investment grade with ratings of A- or A+ . Management believes that the value of these securities will recover and the current unrealized loss positions are a result of interest rate movements. Investments in Asset-backed securities - Student loans are composed primarily of securities collateralized by Federal Family Education Loan Program loans (“FFELP loans”). FFELP loans benefit from a US federal government guarantee of at least 97% of defaulted principal and accrued interest, with additional credit support provided in the form of over-collateralization, subordination and excess spread, which collectively total in excess of 100%. Accordingly, the vast majority of FFELP loan-backed securities are not exposed to traditional consumer credit risk. Investments in Commercial mortgage-backed securities relate to 11 senior securities rated AAA or AA+ that possess significant subordination, a form of credit enhancement expressed hereafter as the percentage of pool losses that can occur before the senior securities held by the Bank will incur its first dollar of principal loss. No credit losses were recognized as for eight of these securities the weighted average credit support and the weighted average loan-to-value ratios ("LTV") range from 25% - 38% and 46% - 72% , respectively. In respect of the three remaining securities, two are fully defeased with the other having an LTV of less than 30% . Investments in Residential mortgage-backed securities relate to 17 securities which are rated AAA or AA+ and possess similar significant credit enhancement as described above. No credit losses were recognized on these securities as the weighted average credit support and the weighted average LTV ratios range from 6% - 21% and 53% - 65% , respectively. Current credit support is significantly greater than any delinquencies experienced on the underlying mortgages. In the following tables, debt securities with unrealized losses that are not deemed to be OTTI are categorized as being in a loss position for "less than 12 months" or "12 months or more" based on the point in time that the fair value most recently declined below the amortized cost basis. In 2018, the classification of certain securities was revised from "less than 12 months" to "12 months or more". The 2017 classification presented below was revised to properly present the disclosure accordingly. Less than 12 months 12 months or more December 31, 2018 Fair value Gross Fair value Gross Total fair value Total gross Available-for-sale securities with unrealized losses US government and federal agencies 372,283 (1,586 ) 1,027,638 (36,070 ) 1,399,921 (37,656 ) Non-US governments debt securities — — 22,360 (398 ) 22,360 (398 ) Corporate debt securities 14,914 (114 ) 63,799 (1,350 ) 78,713 (1,464 ) Asset-backed securities - Student loans — — 12,626 (664 ) 12,626 (664 ) Commercial mortgage-backed securities 812 — 117,379 (2,603 ) 118,191 (2,603 ) Residential mortgage-backed securities 49,804 (1,313 ) 106,465 (2,910 ) 156,269 (4,223 ) Total available-for-sale securities with unrealized losses 437,813 (3,013 ) 1,350,267 (43,995 ) 1,788,080 (47,008 ) Held-to-maturity securities with unrealized losses US government and federal agencies 647,484 (11,468 ) 724,974 (23,450 ) 1,372,458 (34,918 ) Less than 12 months 12 months or more December 31, 2017 Fair value Gross Fair value Gross Total fair value Total gross Available-for-sale securities with unrealized losses US government and federal agencies 467,958 (2,461 ) 1,043,601 (17,940 ) 1,511,559 (20,401 ) Non-US governments debt securities — — 22,360 (386 ) 22,360 (386 ) Corporate debt securities 76,016 (225 ) 49,964 (555 ) 125,980 (780 ) Asset-backed securities - Student loans — — 12,493 (797 ) 12,493 (797 ) Commercial mortgage-backed securities 98,822 (709 ) 36,766 (587 ) 135,588 (1,296 ) Residential mortgage-backed securities 71,604 (486 ) 56,287 (1,149 ) 127,891 (1,635 ) Total available-for-sale securities with unrealized losses 714,400 (3,881 ) 1,221,471 (21,414 ) 1,935,871 (25,295 ) Held-to-maturity securities with unrealized losses US government and federal agencies 549,532 (2,862 ) 288,830 (6,552 ) 838,362 (9,414 ) Investment Maturities The following table presents the remaining term to contractual maturity of the Bank’s securities. The actual maturities may differ as certain securities offer prepayment options to the borrowers. Remaining term to maturity December 31, 2018 Within 3 months 3 to 12 months 1 to 5 years 5 to 10 years Over 10 years No specific or single maturity Carrying amount Trading Mutual funds — — — — — 6,495 6,495 Available-for-sale US government and federal agencies — — 34,423 — — 1,752,084 1,786,507 Non-US governments debt securities — 3,064 22,361 — — — 25,425 Corporate debt securities — 14,924 63,789 — — — 78,713 Asset-backed securities - Student loans — — — — — 12,626 12,626 Commercial mortgage-backed securities — — — — — 123,209 123,209 Residential mortgage-backed securities — — — — — 156,269 156,269 Total available-for-sale — 17,988 120,573 — — 2,044,188 2,182,749 Held-to-maturity US government and federal agencies — — — — — 2,066,120 2,066,120 Total investments — 17,988 120,573 — — 4,116,803 4,255,364 Total by currency US dollars — 17,988 120,573 — — 4,116,484 4,255,045 Other — — — — — 319 319 Total investments — 17,988 120,573 — — 4,116,803 4,255,364 Pledged Investments The Bank pledges certain US government and federal agencies investment securities to further secure the Bank's issued customer deposit products. The secured party does not have the right to sell or repledge the collateral. December 31, 2018 December 31, 2017 Pledged Investments Amortized Fair value Amortized Fair value Available-for-sale 42,531 42,400 149,999 150,900 Held-to-maturity 70,818 69,030 202,303 201,523 Sale Proceeds and Realized Gains and Losses of AFS Securities Year ended December 31, 2018 Sale proceeds Gross realized Gross realized US government and federal agencies 812,720 1,599 (1,263 ) Corporate debt securities 24,975 — (87 ) Commercial mortgage-backed securities 15,260 — (354 ) Pass-through note 1,205 1,205 — Total 854,160 2,804 (1,704 ) Year ended December 31, 2017 Sale Gross realized Gross realized Corporate debt securities 202,700 1,684 — Commercial mortgage-backed securities 7,785 — (60 ) Pass-through note 2,562 2,562 — Total 213,047 4,246 (60 ) Year ended December 31, 2016 Sale Gross realized Gross realized US government and federal agencies 59,939 1,013 (76 ) Pass-through note 609 609 — Total 60,548 1,622 (76 ) Taxability of Interest Income None of the investments' interest income have received a specific preferential income tax treatment in any of the jurisdictions in which the Bank owns investments. |
Loans
Loans | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Loans | Note 6: Loans The "Bermuda" and "Non-Bermuda" classifications purpose is to reflect management segment reporting as described in Note 15: Segmented information . The principal means of securing residential mortgages, personal, credit card and business loans are entitlements over assets and guarantees. Mortgage loans are generally repayable over periods of up to thirty years and personal, business and government loans are generally repayable over terms not exceeding five years. Amounts owing on credit cards are revolving and typically a minimum amount is due within 30 days from billing. The effective yield on total loans as at December 31, 2018 is 5.53% ( December 31, 2017 : 5.09% ). December 31, 2018 December 31, 2017 Bermuda Non-Bermuda Total Bermuda Non-Bermuda Total Commercial loans Government 92,994 12,670 105,664 139,987 13,414 153,401 Commercial and industrial 291,470 222,393 513,863 197,251 173,701 370,952 Commercial overdrafts 16,342 16,752 33,094 18,649 2,874 21,523 Total gross commercial loans 400,806 251,815 652,621 355,887 189,989 545,876 Less specific allowance for credit losses (2,766 ) (1,687 ) (4,453 ) (2,866 ) — (2,866 ) Net commercial loans 398,040 250,128 648,168 353,021 189,989 543,010 Commercial real estate loans Commercial mortgage 304,519 192,456 496,975 346,094 189,741 535,835 Construction 29,760 48,909 78,669 24,500 23,743 48,243 Total gross commercial real estate loans 334,279 241,365 575,644 370,594 213,484 584,078 Less specific allowance for credit losses (600 ) — (600 ) (550 ) (33 ) (583 ) Net commercial real estate loans 333,679 241,365 575,044 370,044 213,451 583,495 Consumer loans Automobile financing 13,249 6,975 20,224 13,113 6,182 19,295 Credit card 60,466 23,623 84,089 57,777 21,228 79,005 Overdrafts 10,511 2,375 12,886 5,490 2,871 8,361 Other consumer 28,415 35,076 63,491 29,818 51,196 81,014 Total gross consumer loans 112,641 68,049 180,690 106,198 81,477 187,675 Less specific allowance for credit losses (274 ) — (274 ) (274 ) — (274 ) Net consumer loans 112,367 68,049 180,416 105,924 81,477 187,401 Residential mortgage loans 1,121,288 1,538,748 2,660,036 1,156,134 1,338,566 2,494,700 Less specific allowance for credit losses (8,575 ) (1,013 ) (9,588 ) (8,681 ) (1,220 ) (9,901 ) Net residential mortgage loans 1,112,713 1,537,735 2,650,448 1,147,453 1,337,346 2,484,799 Total gross loans 1,969,014 2,099,977 4,068,991 1,988,813 1,823,516 3,812,329 Less specific allowance for credit losses (12,215 ) (2,700 ) (14,915 ) (12,371 ) (1,253 ) (13,624 ) Less general allowance for credit losses (7,098 ) (3,089 ) (10,187 ) (16,339 ) (5,504 ) (21,843 ) Net loans 1,949,701 2,094,188 4,043,889 1,960,103 1,816,759 3,776,862 Age Analysis of Past Due Loans (Including Non-Accrual Loans) The following tables summarize the past due status of the loans as at December 31, 2018 and December 31, 2017 . The aging of past due amounts are determined based on the contractual delinquency status of payments under the loan and this aging may be affected by the timing of the last business day at period end. Loans less than 30 days past due are included in current loans. December 31, 2018 30 - 59 days 60 - 89 days More than 90 days Total past due loans Total current Total loans Commercial loans Government — — 3,750 3,750 101,914 105,664 Commercial and industrial 231 — 7,379 7,610 506,253 513,863 Commercial overdrafts — — 2 2 33,092 33,094 Total commercial loans 231 — 11,131 11,362 641,259 652,621 Commercial real estate loans Commercial mortgage 837 1,282 4,062 6,181 490,794 496,975 Construction — — — — 78,669 78,669 Total commercial real estate loans 837 1,282 4,062 6,181 569,463 575,644 Consumer loans Automobile financing 125 29 162 316 19,908 20,224 Credit card 351 313 126 790 83,299 84,089 Overdrafts — — 4 4 12,882 12,886 Other consumer 456 183 577 1,216 62,275 63,491 Total consumer loans 932 525 869 2,326 178,364 180,690 Residential mortgage loans 31,015 8,859 36,394 76,268 2,583,768 2,660,036 Total gross loans 33,015 10,666 52,456 96,137 3,972,854 4,068,991 December 31, 2017 30 - 59 days 60 - 89 days More than 90 days Total past due loans Total current Total loans Commercial loans Government — — — — 153,401 153,401 Commercial and industrial — 1,005 7,481 8,486 362,466 370,952 Commercial overdrafts — — 1 1 21,522 21,523 Total commercial loans — 1,005 7,482 8,487 537,389 545,876 Commercial real estate loans Commercial mortgage 392 — 4,781 5,173 530,662 535,835 Construction — — — — 48,243 48,243 Total commercial real estate loans 392 — 4,781 5,173 578,905 584,078 Consumer loans Automobile financing 7 12 226 245 19,050 19,295 Credit card 422 177 170 769 78,236 79,005 Overdrafts — — 4 4 8,357 8,361 Other consumer 797 329 441 1,567 79,447 81,014 Total consumer loans 1,226 518 841 2,585 185,090 187,675 Residential mortgage loans 19,121 10,142 35,658 64,921 2,429,779 2,494,700 Total gross loans 20,739 11,665 48,762 81,166 3,731,163 3,812,329 Loans' Credit Quality The four credit quality classifications set out in the following tables (which exclude purchased credit-impaired loans) are defined below and describe the credit quality of the Bank's lending portfolio. These classifications each encompass a range of more granular, internal credit rating grades assigned. A pass loan shall mean a loan that is expected to be repaid as agreed. A loan is classified as pass where the Bank is not expected to face repayment difficulties because the present and projected cash flows are sufficient to repay the debt and the repayment schedule as established by the agreement is being followed. A special mention loan shall mean a loan under close monitoring by the Bank’s management. Loans in this category are currently protected and still performing (current with respect to interest and principal payments), but are potentially weak and present an undue credit risk exposure, but not to the point of justifying a classification of substandard. A substandard loan shall mean a loan whose evident unreliability makes repayment doubtful and there is a threat of loss to the Bank unless the unreliability is averted. A non-accrual loan shall mean either management is of the opinion full payment of principal or interest is in doubt or when principal or interest is 90 days past due and for residential mortgage loans which are not well secured and in the process of collection. December 31, 2018 Pass Special mention Substandard Non-accrual Total gross recorded investments Commercial loans Government 101,914 — — 3,750 105,664 Commercial and industrial 501,241 4,097 1,146 7,379 513,863 Commercial overdrafts 29,896 2,705 491 2 33,094 Total commercial loans 633,051 6,802 1,637 11,131 652,621 Commercial real estate loans Commercial mortgage 444,397 45,390 3,126 4,062 496,975 Construction 78,669 — — — 78,669 Total commercial real estate loans 523,066 45,390 3,126 4,062 575,644 Consumer loans Automobile financing 19,927 119 16 162 20,224 Credit card 83,963 — 126 — 84,089 Overdrafts 12,650 232 — 4 12,886 Other consumer 60,766 1,869 10 846 63,491 Total consumer loans 177,306 2,220 152 1,012 180,690 Residential mortgage loans 2,501,814 47,039 78,697 32,486 2,660,036 Total gross recorded loans 3,835,237 101,451 83,612 48,691 4,068,991 December 31, 2017 Pass Special mention Substandard Non-accrual Total gross recorded investments Commercial loans Government 149,651 — 3,750 — 153,401 Commercial and industrial 357,298 4,864 1,309 7,481 370,952 Commercial overdrafts 17,558 3,569 395 1 21,523 Total commercial loans 524,507 8,433 5,454 7,482 545,876 Commercial real estate loans Commercial mortgage 464,283 63,663 3,108 4,781 535,835 Construction 48,243 — — — 48,243 Total commercial real estate loans 512,526 63,663 3,108 4,781 584,078 Consumer loans Automobile financing 18,816 232 21 226 19,295 Credit card 78,835 — 170 — 79,005 Overdrafts 8,263 94 — 4 8,361 Other consumer 79,080 1,419 31 484 81,014 Total consumer loans 184,994 1,745 222 714 187,675 Residential mortgage loans 2,351,845 35,996 75,985 30,874 2,494,700 Total gross recorded loans 3,573,872 109,837 84,769 43,851 3,812,329 Evaluation of Loans For Impairment December 31, 2018 December 31, 2017 Individually evaluated Collectively evaluated Individually evaluated Collectively evaluated Commercial 12,096 640,525 8,487 537,389 Commercial real estate 7,188 568,456 7,889 576,189 Consumer 1,023 179,667 1,138 186,537 Residential mortgage 102,127 2,557,909 99,652 2,395,048 Total gross loans 122,434 3,946,557 117,166 3,695,163 Changes in General and Specific Allowances For Credit Losses Year ended December 31, 2018 Commercial Commercial real estate Consumer Residential mortgage Total Allowances at beginning of year 6,309 10,360 888 17,910 35,467 Provision taken (released) 865 (6,290 ) 211 (1,777 ) (6,991 ) Recoveries 14 28 656 201 899 Charge-offs (275 ) — (953 ) (2,931 ) (4,159 ) Other — (6 ) — (108 ) (114 ) Allowances at end of year 6,913 4,092 802 13,295 25,102 Allowances at end of year: individually evaluated for impairment 4,453 600 274 9,588 14,915 Allowances at end of year: collectively evaluated for impairment 2,460 3,492 528 3,707 10,187 Year ended December 31, 2017 Commercial Commercial real estate Consumer Residential mortgage Total Allowances at beginning of year 3,377 16,224 965 23,681 44,247 Provision taken (released) 2,853 (5,895 ) 1,059 (3,854 ) (5,837 ) Recoveries 106 — 730 483 1,319 Charge-offs (34 ) (1 ) (1,869 ) (2,475 ) (4,379 ) Other 7 32 3 75 117 Allowances at end of year 6,309 10,360 888 17,910 35,467 Allowances at end of year: individually evaluated for impairment 2,866 583 274 9,901 13,624 Allowances at end of year: collectively evaluated for impairment 3,443 9,777 614 8,009 21,843 Year ended December 31, 2016 Commercial Commercial real estate Consumer Residential mortgage Total Allowances at beginning of year 8,723 6,512 2,763 31,304 49,302 Provision taken (released) (5,265 ) 14,459 (1,076 ) (3,719 ) 4,399 Recoveries 97 12 1,264 70 1,443 Charge-offs (138 ) (4,520 ) (1,916 ) (3,837 ) (10,411 ) Other (40 ) (239 ) (70 ) (137 ) (486 ) Allowances at end of year 3,377 16,224 965 23,681 44,247 Allowances at end of year: individually evaluated for impairment 577 750 278 10,133 11,738 Allowances at end of year: collectively evaluated for impairment 2,800 15,474 687 13,548 32,509 Non-Performing Loans (excluding purchased credit-impaired loans) December 31, 2018 December 31, 2017 Non-accrual Past due more than 90 days and accruing Total non- performing loans Non-accrual Past due more than 90 days and accruing Total non- performing loans Commercial loans Government 3,750 — 3,750 — — — Commercial and industrial 7,379 — 7,379 7,481 — 7,481 Commercial overdrafts 2 — 2 1 — 1 Total commercial loans 11,131 — 11,131 7,482 — 7,482 Commercial real estate loans Commercial mortgage 4,062 — 4,062 4,781 — 4,781 Consumer loans Automobile financing 162 — 162 226 — 226 Credit card — 126 126 — 170 170 Overdrafts 4 — 4 4 — 4 Other consumer 846 — 846 484 — 484 Total consumer loans 1,012 126 1,138 714 170 884 Residential mortgage loans 32,486 6,332 38,818 30,874 4,186 35,060 Total non-performing loans 48,691 6,458 55,149 43,851 4,356 48,207 Impaired Loans (excluding purchased credit-impaired loans) A loan is considered to be impaired when, based on current information and events, the Bank determines that it will not be able to collect all amounts due according to the original loan contract, including scheduled interest payments. Impaired loans include all non-accrual loans and all loans modified in a troubled debt restructuring (‘‘TDR’’) even if full collectability is expected following the restructuring. During the year ended December 31, 2018 , the amount of gross interest income that would have been recorded had impaired loans been current was $2.1 million ( December 31, 2017 : $2.1 million ; December 31, 2016 : $2.7 million ). Impaired loans with an allowance Gross recorded investment of impaired loans without an allowance Total impaired loans December 31, 2018 Gross recorded investment Specific allowance Net loans Gross recorded investment Specific allowance Net loans Commercial loans Government 3,750 (1,687 ) 2,063 — 3,750 (1,687 ) 2,063 Commercial and industrial 7,379 (2,766 ) 4,613 965 8,344 (2,766 ) 5,578 Commercial overdrafts — — — 2 2 — 2 Total commercial loans 11,129 (4,453 ) 6,676 967 12,096 (4,453 ) 7,643 Commercial real estate loans Commercial mortgage 1,081 (600 ) 481 6,108 7,189 (600 ) 6,589 Consumer loans Automobile financing 130 (75 ) 55 32 162 (75 ) 87 Overdrafts — — — 4 4 — 4 Other consumer 199 (199 ) — 647 846 (199 ) 647 Total consumer loans 329 (274 ) 55 683 1,012 (274 ) 738 Residential mortgage loans 49,431 (9,422 ) 40,009 49,571 99,002 (9,422 ) 89,580 Total impaired loans 61,970 (14,749 ) 47,221 57,329 119,299 (14,749 ) 104,550 Specific allowance excludes $0.2 million recognized relating to purchased credit-impaired loans. Impaired loans with an allowance Gross recorded investment of impaired loans without an allowance Total impaired loans December 31, 2017 Gross recorded investment Specific allowance Net loans Gross recorded investment Specific allowance Net loans Commercial loans Commercial and industrial 7,475 (2,866 ) 4,609 1,011 8,486 (2,866 ) 5,620 Commercial overdrafts — — — 1 1 — 1 Total commercial loans 7,475 (2,866 ) 4,609 1,012 8,487 (2,866 ) 5,621 Commercial real estate loans Commercial mortgage 1,585 (583 ) 1,002 6,304 7,889 (583 ) 7,306 Consumer loans Automobile financing 138 (75 ) 63 88 226 (75 ) 151 Overdrafts — — — 4 4 — 4 Other consumer 199 (199 ) — 285 484 (199 ) 285 Total consumer loans 337 (274 ) 63 377 714 (274 ) 440 Residential mortgage loans 53,698 (9,630 ) 44,068 42,055 95,753 (9,630 ) 86,123 Total impaired loans 63,095 (13,353 ) 49,742 49,748 112,843 (13,353 ) 99,490 Specific allowance excludes $0.3 million recognized relating to purchased credit-impaired loans. Average Impaired Loan Balances and Related Recognized Interest Income December 31, 2018 December 31, 2017 December 31, 2016 Average gross recorded investment Interest Average gross recorded investment Interest Average gross recorded investment Interest Commercial loans Government 3,750 — — — — — Commercial and industrial 8,415 68 5,057 63 1,661 64 Commercial overdrafts 2 — 2 — 14 — Total commercial loans 12,167 68 5,059 63 1,675 64 Commercial real estate loans Commercial mortgage 7,539 287 7,778 222 15,496 237 Consumer loans Automobile financing 194 — 256 — 192 — Overdrafts 4 — 11 — 14 — Other consumer 665 — 598 — 1,043 — Total consumer loans 863 — 865 — 1,249 — Residential mortgage loans 97,378 4,568 89,063 4,378 81,901 2,201 Total impaired loans 117,947 4,923 102,765 4,663 100,321 2,502 ¹ All interest income recognized on impaired loans relate to loans previously modified in a TDR. Loans Modified in a TDR As at December 31, 2018 , the Bank had two loans which were formerly residential mortgages that were modified in a TDR during the preceding 12 months that subsequently defaulted (i.e., 90 days or more past due following a modification) with a recorded investment of $0.8 million . As at December 31, 2017 , the Bank had no loans that were modified in a TDR during the preceding 12 months that subsequently defaulted. As at December 31, 2016 , one loan which was formerly a residential mortgage was modified in a TDR during the preceding 12 months that subsequently defaulted with a recorded investment of $0.9 million . TDRs entered into during the year Year ended December 31, 2018 Number of contracts Pre- modification recorded investment Modification: Post- modification recorded investment Residential mortgage loans 19 7,864 846 8,710 Total loans modified in a TDR 19 7,864 846 8,710 Year ended December 31, 2017 Number of Pre- Modification: Post- Commercial real estate loans 2 1,544 — 1,544 Residential mortgage loans 42 24,588 1,345 25,933 Total loans modified in a TDR 44 26,132 1,345 27,477 Year ended December 31, 2016 Number of contracts Pre- modification recorded investment Modification: Post- modification recorded investment Residential mortgage loans 21 12,543 81 12,624 Total loans modified in a TDR 21 12,543 81 12,624 December 31, 2018 December 31, 2017 TDRs outstanding Accrual Non-accrual Accrual Non-accrual Commercial loans 965 — 1,005 — Commercial real estate loans 3,127 1,336 3,108 1,471 Residential mortgage loans 66,516 8,154 64,879 5,623 Total TDRs outstanding 70,608 9,490 68,992 7,094 Purchased Credit-Impaired Loans The Bank acquired certain credit-impaired loans as part of the November 7, 2014 acquisition of substantially all retail loans of HSBC Bank (Cayman) Limited. The accretable difference (or "accretable yield") represents the excess of a loan's cash flows expected to be collected over the loan's carrying amount. Year ended December 31, 2018 Contractual principal Non-accretable difference Accretable difference Carrying amount Balance at beginning of year 6,001 (1,239 ) (711 ) 4,051 Advances and increases in cash flows expected to be collected 25 42 (42 ) 25 Reductions resulting from repayments (1,495 ) 191 92 (1,212 ) Reductions resulting from changes in allowances for credit losses — 105 — 105 Balance at end of year 4,531 (901 ) (661 ) 2,969 Year ended December 31, 2017 Contractual principal Non-accretable difference Accretable difference Carrying amount Balance at beginning of year 8,016 (1,617 ) (811 ) 5,588 Advances and increases in cash flows expected to be collected 36 48 (48 ) 36 Reductions resulting from repayments (1,581 ) 307 148 (1,126 ) Reductions resulting from changes in allowances for credit losses — (99 ) — (99 ) Reductions resulting from charge-offs (470 ) 122 — (348 ) Balance at end of year 6,001 (1,239 ) (711 ) 4,051 Year ended December 31, 2016 Contractual principal Non-accretable difference Accretable difference Carrying amount Balance at beginning of year 8,709 (2,248 ) (631 ) 5,830 Advances and increases in cash flows expected to be collected 166 408 (396 ) 178 Reductions resulting from repayments (464 ) — 216 (248 ) Reductions resulting from changes in allowances for credit losses — (172 ) — (172 ) Reductions resulting from charge-offs (395 ) 395 — — Balance at end of year 8,016 (1,617 ) (811 ) 5,588 |
Credit risk concentrations
Credit risk concentrations | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Credit risk concentrations | Note 7: Credit risk concentrations Concentrations of credit risk in the lending and off-balance sheet credit-related arrangements portfolios arise when a number of customers are engaged in similar business activities, are in the same geographic region, or when they have similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. The Bank regularly monitors various segments of its credit risk portfolio to assess potential concentrations of risks and to obtain collateral when deemed necessary. In the Bank's commercial portfolio, risk concentrations are evaluated primarily by industry and by geographic region of loan origination. In the consumer portfolio, concentrations are evaluated primarily by products. Credit exposures include loans, guarantees and acceptances, letters of credit and commitments for undrawn lines of credit. Unconditionally cancellable credit cards and overdraft lines of credit are excluded from the tables below. The following tables summarize the credit exposure of the Bank by business sector and by geographic region. The on-balance sheet exposure amounts disclosed are net of specific allowances and the off-balance sheet exposure amounts disclosed are gross of collateral held. December 31, 2018 December 31, 2017 Business sector Loans Off-balance sheet Total credit exposure Loans Off-balance sheet Total credit exposure Banks and financial services 611,404 415,124 1,026,528 459,132 390,278 849,410 Commercial and merchandising 316,349 182,440 498,789 261,560 193,583 455,143 Governments 104,857 — 104,857 153,952 85,807 239,759 Individuals 2,339,854 89,931 2,429,785 2,274,632 114,215 2,388,847 Primary industry and manufacturing 120,088 1,003 121,091 59,532 9,567 69,099 Real estate 395,086 1,547 396,633 439,595 2,225 441,820 Hospitality industry 160,680 3,497 164,177 144,808 73 144,881 Transport and communication 5,758 75 5,833 5,494 — 5,494 Sub-total 4,054,076 693,617 4,747,693 3,798,705 795,748 4,594,453 General allowance (10,187 ) — (10,187 ) (21,843 ) — (21,843 ) Total 4,043,889 693,617 4,737,506 3,776,862 795,748 4,572,610 December 31, 2018 December 31, 2017 Geographic region Cash due from Loans Off-balance sheet Total credit exposure Cash due from Loans Off-balance sheet Total credit exposure Australia 145,675 — — 145,675 113,920 — — 113,920 Bermuda 36,827 2,133,859 333,845 2,504,531 14,512 2,132,918 418,850 2,566,280 Canada 759,437 — — 759,437 386,322 — — 386,322 Cayman 18,138 730,418 222,189 970,745 67,942 669,767 229,731 967,440 Guernsey 6 290,578 22,619 313,203 3 292,806 41,648 334,457 Japan 14,271 — — 14,271 12,852 — — 12,852 Jersey — 9,083 449 9,532 — — — — New Zealand 1,082 — — 1,082 7,951 — — 7,951 Norway 8,750 — — 8,750 25,440 — — 25,440 Saint Lucia — 90,000 — 90,000 — 120,000 — 120,000 Switzerland 6,637 — — 6,637 5,743 — — 5,743 The Bahamas 1,534 14,367 — 15,901 1,652 17,451 — 19,103 United Kingdom 725,634 783,708 114,515 1,623,857 775,853 562,013 105,519 1,443,385 United States 411,248 — — 411,248 544,703 — — 544,703 Other 4,321 2,063 — 6,384 6,998 3,750 — 10,748 Sub-total 2,133,560 4,054,076 693,617 6,881,253 1,963,891 3,798,705 795,748 6,558,344 General allowance — (10,187 ) — (10,187 ) — (21,843 ) — (21,843 ) Total 2,133,560 4,043,889 693,617 6,871,066 1,963,891 3,776,862 795,748 6,536,501 |
Premises, equipment and compute
Premises, equipment and computer software | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Premises, equipment and computer software | Note 8: Premises, equipment and computer software December 31, 2018 December 31, 2017 Category Cost Accumulated Net carrying Cost Accumulated Net carrying Land 8,612 — 8,612 9,008 — 9,008 Buildings 144,196 (61,853 ) 82,343 139,534 (59,110 ) 80,424 Equipment 21,323 (15,490 ) 5,833 20,000 (15,997 ) 4,003 Computer hardware and software in use 177,017 (121,652 ) 55,365 165,251 (102,449 ) 62,802 Computer software in development 5,907 — 5,907 8,553 — 8,553 Total 357,055 (198,995 ) 158,060 342,346 (177,556 ) 164,790 Year ended Depreciation charged to operating expenses December 31, 2018 December 31, 2017 December 31, 2016 Buildings (included in Property expense) 4,283 3,781 4,058 Equipment (included in Property expense) 1,413 1,336 1,462 Computer hardware and software (included in Technology and communication expense) 20,441 18,382 18,757 Total depreciation charged to operating expenses 26,137 23,499 24,277 |
Goodwill and other intangible a
Goodwill and other intangible assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets | Note 9: Goodwill and other intangible assets Goodwill Segment Cayman Channel Islands and the UK Other Total Balance at December 31, 2015 — 23,462 — 23,462 Foreign exchange translation adjustment — (3,840 ) — (3,840 ) Balance at December 31, 2016 — 19,622 — 19,622 Foreign exchange translation adjustment — 1,907 — 1,907 Balance at December 31, 2017 — 21,529 — 21,529 Acquisitions during the year 551 1,231 2,086 3,868 Foreign exchange translation adjustment — (1,333 ) (73 ) (1,406 ) Balance at December 31, 2018 551 21,427 2,013 23,991 Customer Relationship Intangible Assets December 31, 2018 December 31, 2017 Business segment Cost Accumulated Net carrying Cost Accumulated Net carrying Bermuda 29,785 (11,733 ) 18,052 29,785 (9,748 ) 20,037 Cayman 17,728 (4,571 ) 13,157 12,324 (3,557 ) 8,767 Channel Islands and the UK 65,698 (51,210 ) 14,488 58,420 (48,158 ) 10,262 Other 5,563 (509 ) 5,054 — — — Total 118,774 (68,023 ) 50,751 100,529 (61,463 ) 39,066 Customer relationships are initially valued based on the present value of net cash flows expected to be derived solely from the recurring customer base existing as at the date of acquisition. Customer relationship intangible assets may or may not arise from contracts. During the year ended December 31, 2018 , the Bank acquired $18.2 million new customer intangible assets with an estimated useful life of 15 years, of which $16.9 million was acquired through a business acquisition (see Note 26 Business combinations) and $1.3 million via asset acquisitions ( December 31, 2017 : nil , December 31, 2016 : $21.4 million ). The amortization expense amounted to $5.1 million ( December 31, 2017 : $4.2 million , December 31, 2016 : $4.5 million ) and the foreign exchange translation adjustment decreased the net carrying amount by $1.5 million ( December 31, 2017 : decreased by $1.0 million , December 31, 2016 : decreased by $2.3 million ). The estimated aggregate amortization expense for each of the succeeding five years is $5.4 million . |
Customer deposits and deposits
Customer deposits and deposits from banks | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
Customer deposits and deposits from banks | Note 10: Customer deposits and deposits from banks By Maturity Demand Total demand deposits Term Total term deposits December 31, 2018 Non-interest bearing Interest bearing Within 3 months 3 to 6 months 6 to 12 months After 12 months Total deposits Customers Bermuda Demand or less than $100k¹ 1,378,539 2,158,971 3,537,510 12,387 4,306 8,049 14,644 39,386 3,576,896 Term - $100k or more N/A N/A — 598,528 92,427 184,337 43,414 918,706 918,706 Total Bermuda 1,378,539 2,158,971 3,537,510 610,915 96,733 192,386 58,058 958,092 4,495,602 Non-Bermuda Demand or less than $100k 1 732,957 3,179,376 3,912,333 18,714 5,386 4,705 507 29,312 3,941,645 Term and $100k or more N/A N/A — 608,390 126,022 235,278 11,482 981,172 981,172 Total non-Bermuda 732,957 3,179,376 3,912,333 627,104 131,408 239,983 11,989 1,010,484 4,922,817 Total customer deposits 2,111,496 5,338,347 7,449,843 1,238,019 228,141 432,369 70,047 1,968,576 9,418,419 Banks Bermuda Demand or less than $100k 8,100 — 8,100 — — — — — 8,100 Non-Bermuda Demand or less than $100k — 18,965 18,965 — — — — — 18,965 Term and $100k or more N/A N/A — 6,656 — 101 — 6,757 6,757 Total non-Bermuda — 18,965 18,965 6,656 — 101 — 6,757 25,722 Total bank deposits 8,100 18,965 27,065 6,656 — 101 — 6,757 33,822 Total deposits 2,119,596 5,357,312 7,476,908 1,244,675 228,141 432,470 70,047 1,975,333 9,452,241 Demand Total demand deposits Term Total term deposits December 31, 2017 Non-interest bearing Interest bearing Within 3 months 3 to 6 months 6 to 12 months After 12 months Total deposits Customers Bermuda Demand or less than $100k¹ 1,840,201 2,578,411 4,418,612 13,983 4,267 8,640 13,984 40,874 4,459,486 Term - $100k or more N/A N/A — 646,751 33,495 75,235 37,857 793,338 793,338 Total Bermuda 1,840,201 2,578,411 4,418,612 660,734 37,762 83,875 51,841 834,212 5,252,824 Non-Bermuda Demand or less than $100k 1 639,525 2,755,517 3,395,042 19,147 5,202 4,762 781 29,892 3,424,934 Term and $100k or more N/A N/A — 657,134 88,650 94,245 6,205 846,234 846,234 Total non-Bermuda 639,525 2,755,517 3,395,042 676,281 93,852 99,007 6,986 876,126 4,271,168 Total customer deposits 2,479,726 5,333,928 7,813,654 1,337,015 131,614 182,882 58,827 1,710,338 9,523,992 Banks Bermuda Demand or less than $100k 442 — 442 — — — — — 442 Non-Bermuda Demand or less than $100k — 7,704 7,704 — — — — — 7,704 Term and $100k or more N/A N/A — 4,220 — 100 — 4,320 4,320 Total non-Bermuda — 7,704 7,704 4,220 — 100 — 4,320 12,024 Total bank deposits 442 7,704 8,146 4,220 — 100 — 4,320 12,466 Total deposits 2,480,168 5,341,632 7,821,800 1,341,235 131,614 182,982 58,827 1,714,658 9,536,458 ¹ The weighted-average interest rate on interest-bearing demand deposits as at December 31, 2018 is 0.13% ( December 31, 2017 : 0.02% ). By Type and Segment December 31, 2018 December 31, 2017 Payable on demand Payable on a fixed date Total Payable on demand Payable on a fixed date Total Bermuda Customers 3,537,510 958,092 4,495,602 4,418,649 834,211 5,252,860 Banks 8,100 — 8,100 442 — 442 Cayman Customers 2,847,793 472,442 3,320,235 2,529,499 405,215 2,934,714 Banks 17,564 6,757 24,321 7,704 4,320 12,024 Channel Islands and the UK Customers 1,064,540 538,042 1,602,582 865,506 470,912 1,336,418 Banks 1,401 — 1,401 — — — Total Customers 7,449,843 1,968,576 9,418,419 7,813,654 1,710,338 9,523,992 Total Banks 27,065 6,757 33,822 8,146 4,320 12,466 Total deposits 7,476,908 1,975,333 9,452,241 7,821,800 1,714,658 9,536,458 |
Employee benefit plans
Employee benefit plans | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
Employee benefit plans | Note 11: Employee benefit plans The Bank maintains trusteed pension plans including non-contributory defined benefit plans and a number of defined contribution plans, and provides post-retirement medical benefits to its qualifying retirees. The defined benefit provisions under the pension plans are generally based upon years of service and average salary during the relevant years of employment. The defined benefit and post-retirement medical plans are not open to new participants and are non-contributory and the funding required is provided by the Bank, based upon the advice of independent actuaries. The defined benefit pension plans are in the Bermuda, Guernsey and United Kingdom jurisdictions and the defined benefit post-retirement medical plan is in Bermuda. Bermuda Defined Benefit and Post-Retirement Medical Benefit Plan The Bank amortizes prior service credit resulting from plan amendments that occurred when plan members were active employees, on a linear basis over the expected average remaining service period (to full eligibility) of active members expected to receive benefits under the plan. Such remaining service periods are as follows: 3.1 years for the 2010 plan amendments and 4.6 years for the 2011 plan amendments. Plan amendments occurring in 2014 resulted in the recognition of new prior service cost on December 31, 2014 on a plan for which substantially all members are now inactive and, in accordance with US GAAP, the Bank has elected to amortize this new prior service cost on a linear basis over 21 years, which is the average remaining life expectancy of members eligible for benefits under the plan at the time of the amendments. Guernsey Defined Benefit Pension Plan Effective October 2014, all the participants of the Guernsey defined benefit pension plan became inactive and in accordance with US GAAP, the net actuarial loss of the Guernsey defined benefit pension plan will be amortized over the then estimated average remaining life expectancy of the inactive participants of 39 years. Prior to all of the Guernsey participants being inactive, the net actuarial loss of the Guernsey defined benefit pension plan was amortized to net income over the estimated average remaining service period for active members of 15 years. United Kingdom Defined Benefit Pension Plan The United Kingdom defined benefit pension plan closed to new members effective April 1, 2002 and subsequently closed to further accrual of new benefits effective October 1, 2012. During the years ended December 31, 2017 and 2018, the pension plan settled in cash the liability of several plan members and an insurance policy was purchased in the name of the trustees of the plan to match the liabilities of remaining members who were pensioners as at March 31, 2016. The following table presents the financial position of the Bank’s defined benefit pension plans and the Bank’s post-retirement medical benefit plan, which is unfunded. The Bank measures the benefit obligations and plan assets annually on each December 31 and therefore, the most recent measurement date is December 31, 2018 . December 31, 2018 December 31, 2017 December 31, 2016 Pension Post- Pension Post- Pension Post- Accumulated benefit obligation at end of year 148,966 117,203 179,613 127,687 178,068 126,334 Change in projected benefit obligation Projected benefit obligation at beginning of year 179,613 127,687 178,068 126,334 166,815 119,107 Service cost — 63 — 64 — 118 Interest cost 4,971 4,305 5,361 4,703 5,781 4,792 Benefits paid (17,274 ) (3,263 ) (13,444 ) (2,118 ) (10,477 ) (3,594 ) Prior service cost 212 — — — — — Settlement and curtailment of liability (1,825 ) — (6,108 ) — — — Actuarial (gain) loss (12,423 ) (11,589 ) 7,384 (1,296 ) 30,953 5,911 Foreign exchange translation adjustment (4,308 ) — 8,352 — (15,004 ) — Projected benefit obligation at end of year 148,966 117,203 179,613 127,687 178,068 126,334 Change in plan assets Fair value of plan assets at beginning of year 185,495 — 172,206 — 179,961 — Actual return on plan assets (11,618 ) — 14,801 — 18,615 — Employer contribution 3,653 3,263 8,448 2,118 678 3,594 Plan settlement (1,608 ) — (5,123 ) — — — Benefits paid (17,274 ) (3,263 ) (13,444 ) (2,118 ) (10,477 ) (3,594 ) Foreign exchange translation adjustment (4,497 ) — 8,607 — (16,571 ) — Fair value of plan assets at end of year 154,151 — 185,495 — 172,206 — Amounts recognized in the consolidated balance sheets consist of: Prepaid benefit cost included in other assets 5,185 — 6,993 — 7,771 — Accrued pension benefit cost included in employee benefit plans liability — (117,203 ) (1,111 ) (127,687 ) (13,633 ) (126,334 ) Surplus (deficit) of plan assets over projected benefit obligation at measurement date 5,185 (117,203 ) 5,882 (127,687 ) (5,862 ) (126,334 ) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Pension Post- Pension Post- Pension Post- Amounts recognized in accumulated other comprehensive loss consist of: Net actuarial gain (loss), excluding deferred taxes (65,506 ) (12,946 ) (62,521 ) (27,150 ) (64,852 ) (31,959 ) Net prior service credit (cost) (202 ) (6,397 ) — (6,436 ) — (5,678 ) Deferred income taxes assets (liabilities) 816 — 1,180 — 1,620 — Net amount recognized in accumulated other comprehensive loss (64,892 ) (19,343 ) (61,341 ) (33,586 ) (63,232 ) (37,637 ) Annual Benefit Expense Expense component Line item in the consolidated statements of operations Service cost Salaries and other employee benefits — 63 — 64 — 118 Interest cost Non-service employee benefits expense 4,971 4,305 5,361 4,703 5,781 4,792 Expected return on plan assets Non-service employee benefits expense (8,720 ) — (8,199 ) — (8,943 ) — Amortization of net actuarial (gains) losses Non-service employee benefits expense 2,106 2,615 2,238 3,514 1,702 2,731 Amortization of prior service (credit) loss Non-service employee benefits expense — 39 — (759 ) — (6,343 ) (Gain) loss on settlement Net other gains (losses) / Non-service employee benefits expense 1,757 — 1,232 — — — Defined benefit (income) expense 114 7,022 632 7,522 (1,460 ) 1,298 Defined contribution expense 7,442 — 6,521 — 6,606 — Total benefit (income) expense 7,556 7,022 7,153 7,522 5,146 1,298 The components of benefit expense (income) other than the service cost component are included in the line item non-service employee benefits expense in the consolidated statements of income. Other Changes Recognized in Other Comprehensive Income (Loss) Net gain (loss) arising during the year (5,987 ) 11,589 1,472 1,296 (19,956 ) (5,911 ) Prior service credit (cost) arising during the year (212 ) — — — — — Amortization of net actuarial (gains) losses 2,106 2,615 2,247 3,514 1,702 2,731 Amortization of prior service (credit) cost — 39 — (759 ) — (6,343 ) Change in deferred taxes (298 ) — (595 ) — 1,315 — Foreign exchange adjustment 840 — (1,233 ) — 38 — Total changes recognized in other comprehensive income (loss) (3,551 ) 14,243 1,891 4,051 (16,901 ) (9,523 ) To develop the expected long-term rate of return on the plan assets assumption for each plan, the Bank considered the historical returns and the future expectations for returns for each asset class, as well as the target asset allocations of the assets. The weighted average discount rate used to determine benefit obligations at the end of the year is derived from interest rates on high quality corporate bonds with maturities that match the expected benefit payments. Actuarial Assumptions Year ended December 31, 2018 December 31, 2017 December 31, 2016 Pension plans Post- retirement medical benefit plan Pension plans Post- retirement medical benefit plan Pension Post- Actuarial assumptions used to determine annual benefit expense Weighted average discount rate 3.05 % 3.73 % 3.40 % 4.37 % 3.90 % 4.70 % Weighted average rate of compensation increases 1 2.50 % N/A 2.50 % N/A 2.30 % N/A Weighted average expected long-term rate of return on plan assets 4.70 % N/A 4.75 % N/A 5.30 % N/A Weighted average annual medical cost increase rate (sensitivity shown below) N/A 7.7% to 4.5% in 2035 N/A 7.8% to 4.5% in 2035 N/A 8.0% to 4.5% in 2035 Actuarial assumptions used to determine benefit obligations at end of year Weighted average discount rate 3.65 % 4.40 % 3.05 % 3.73 % 3.40 % 4.37 % Weighted average rate of compensation increases 1 2.50 % N/A 2.40 % N/A 2.50 % N/A Weighted average annual medical cost increase rate (sensitivity shown below) N/A 7.5% to 4.5% in 2035 N/A 7.7% to 4.5% in 2035 N/A 7.8% to 4.5% in 2035 1 Only the United Kingdom subsidiary plan is impacted by potential future compensation increases. Investments Policies and Strategies The pension plans’ assets are managed according to each plan's investment policy statement, which outlines the purpose of the plan, statement of objectives and guidelines and investment policy. The asset allocation is diversified and any use of derivatives is limited to hedging purposes only. December 31, 2018 December 31, 2017 Weighted average actual and target asset allocations of the pension plans by asset category Actual allocation Target allocation Actual allocation Target allocation Debt securities (including debt mutual funds) 33 % 47 % 34 % 48 % Equity securities (including equity mutual funds) 55 % 37 % 52 % 47 % Other 12 % 16 % 14 % 5 % Total 100 % 100 % 100 % 100 % Fair Value Measurements of Pension Plans' Assets The following table presents the fair value of plans' assets by category and level of inputs used in their respective fair value determination as described in Note 2: Significant accounting policies, except the level 3 security, for which the valuation determination is described following the below table: December 31, 2018 December 31, 2017 Fair value determination Fair value determination Level 1 Level 2 Level 3 Total fair value Level 1 Level 2 Level 3 Total fair value US government and federal agencies — 10,221 — 10,221 — 11,318 — 11,318 Non-US governments debt securities — 1,039 — 1,039 — 12,139 — 12,139 Corporate debt securities — 39,589 — 39,589 — 39,072 — 39,072 Equity securities and mutual funds 925 83,638 — 84,563 1,096 95,294 — 96,390 Other — 1,779 16,960 18,739 — 10,917 15,659 26,576 Total fair value of plans' assets 925 136,266 16,960 154,151 1,096 168,740 15,659 185,495 The Level 3 assets consist of insured annuity policies covering the full pension benefits of certain plan members. The fair value of these policies is deemed equal to the actuarial value of the projected benefit obligation for the insured benefits. At December 31, 2018 , 32.6% ( December 31, 2017 : 28.2% ) of the assets of the pension plans were mutual funds and equity securities managed or administered by wholly-owned subsidiaries of the Bank. At December 31, 2018 , 0.6% ( December 31, 2017 : 0.6% ) of the plans' assets were invested in common shares of the Bank. The investments of the pension funds are diversified across a range of asset classes and are diversified within each asset class. The assets are generally actively managed with the goal of adding some incremental value through security selection and asset allocation. Estimated 2019 Bank contribution to and estimated benefit payments for the next ten years under the pension and post-retirement medical benefit plans are as follows: Pension plans Post- retirement medical benefit plan Estimated Bank contributions for the full year ending December 31, 2019 2,500 4,757 Estimated benefit payments by year: 2019 6,600 4,757 2020 6,600 5,076 2021 6,600 5,415 2022 6,600 5,743 2023 6,500 6,073 2024-2028 31,200 34,865 |
Credit-related arrangements, re
Credit-related arrangements, repurchase agreements and commitments | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Credit-related arrangements, repurchase agreements and commitments | Note 12: Credit related arrangements, repurchase agreements and commitments Commitments As at December 31, 2018 , the Bank was committed to expenditures under contract for information technology services sourcing and leases of $39.2 million and $27.2 million , respectively ( December 31, 2017 : $56.9 million and $16.5 million , respectively). Rental expense for premises leased on a long-term basis for the year ended December 31, 2018 amounted to $5.6 million ( December 31, 2017 : $4.9 million , December 31, 2016 : $ 5.1 million ). The leases under contract as of both December 31, 2018 and December 31, 2017 are all non-cancellable operating type leases primarily for the lease of office space. The Bank funded its expenditures with its own resources and plans to fund those currently in progress with its own resources, which may be obtained through cash on hand, cash flows from operations and issuances of debt and equity securities. The following table summarizes the Bank's commitments for sourcing, long-term leases and other agreements: Year ending December 31 Sourcing Leases Other Total 2019 14,721 5,448 7,990 28,159 2020 13,353 5,524 2,214 21,091 2021 11,112 4,696 1,634 17,442 2022 — 4,317 727 5,044 2023 — 3,609 719 4,328 2024 & thereafter — 3,583 719 4,302 Total commitments 39,186 27,177 14,003 80,366 The Bank enters into contractual commitments to extend credit, normally with fixed expiration dates or termination clauses, at specified rates and for specific purposes. Substantially all of the Bank's commitments to extend credit are contingent upon customers maintaining specific credit standards at the time of loan funding. Management assesses the credit risk associated with certain commitments to extend credit in determining the level of the allowance for possible loan losses. The Bank has a facility by one of its custodians, whereby the Bank may offer up to US $200 million of standby letters of credit to its customers on a fully secured basis. Under the standard terms of the facility, the custodian has the right to set-off against securities held of 110% of the utilized facility. At December 31, 2018 , $137.4 million ( December 31, 2017 : $77.0 million ) of standby letters of credit were issued under this facility. Outstanding unfunded commitments to extend credit December 31, 2018 December 31, 2017 Commitments to extend credit 445,215 602,740 Documentary and commercial letters of credit 561 1,263 Total unfunded commitments to extend credit 445,776 604,003 Credit-Related Arrangements Standby letters of credit and letters of guarantee are issued at the request of a Bank customer in order to secure the customer’s payment or performance obligations to a third party. These guarantees represent an irrevocable obligation of the Bank to pay the third party beneficiary upon presentation of the guarantee and satisfaction of the documentary requirements stipulated therein, without investigation as to the validity of the beneficiary’s claim against the customer. Generally, the term of the standby letters of credit does not exceed one year, while the term of the letters of guarantee does not exceed four years. The types and amounts of collateral security held by the Bank for these standby letters of credit and letters of guarantee is generally represented by deposits with the Bank or a charge over assets held in mutual funds. The Bank considers the fees collected in connection with the issuance of standby letters of credit and letters of guarantee to be representative of the fair value of its obligation undertaken in issuing the guarantee. In accordance with applicable accounting standards related to guarantees, the Bank defers fees collected in connection with the issuance of standby letters of credit and letters of guarantee. The fees are then recognized in income proportionately over the life of the credit agreements. The following table presents the outstanding financial guarantees. Collateral is shown at estimated market value less selling cost. Where the collateral is cash, it is shown gross including accrued income. December 31, 2018 December 31, 2017 Outstanding financial guarantees Gross Collateral Net Gross Collateral Net Standby letters of credit 245,156 237,051 8,105 186,408 178,158 8,250 Letters of guarantee 2,685 2,599 86 5,337 5,251 86 Total 247,841 239,650 8,191 191,745 183,409 8,336 Repurchase agreements The Bank utilizes repurchase agreements and resell agreements (reverse repurchase agreements) to manage liquidity. The risks of these transactions include changes in the fair value in the securities posted or received as collateral and other credit-related events. The Bank manages these risks by ensuring that the collaterals involved are appropriate and by monitoring the value of the securities posted or received as collateral on a daily basis. As at December 31, 2018 , the Bank had 2 open positions ( December 31, 2017 : 23 ) in resell agreements with a remaining maturity of less than 30 days involving pools of mortgages issued by US federal agencies. The amortized cost of these resell agreements is $27.3 million ( December 31, 2017 : $178.8 million ) and are included in securities purchased under agreement to resell on the consolidated balance sheets. As at December 31, 2018 , there were no positions ( December 31, 2017 : no positions) which were offset on the balance sheet to arrive at the carrying value, and there was no collateral amount which was available to offset against the future settlement amount. Legal Proceedings There are actions and legal proceedings pending against the Bank and its subsidiaries which arose in the normal course of its business. Management, after reviewing all actions and proceedings pending against or involving the Bank and its subsidiaries, considers that the resolution of these matters would in the aggregate not be material to the consolidated financial position of the Bank, except as noted in the following paragraphs. As publicly announced, in November 2013, the USAO for the Southern District of New York applied for and secured the issuance of so-called John Doe Summonses to six US financial institutions with which the Bank had correspondent bank relationships. The Bank has been fully cooperating with the US authorities in their ongoing investigation. Specifically, the Bank has conducted an extensive review and account remediation exercise to determine the US tax compliance status of US person account holders. The review process and results have been shared with the US authorities. Management believes that as of December 31, 2018 , a provision of $5.5 million ( December 31, 2017 : $5.5 million ), which has been recorded, is appropriate. As the investigation remains ongoing at this time, the timing and terms of the final resolution, including any fines or penalties, remain uncertain and the financial impact to the Bank could exceed the amount of the provision. In this regard, we note that the US authorities have not approved or commented on the adequacy or reasonableness of the estimate. The provision is included on the consolidated balance sheets under other liabilities and on the consolidated statements of operations under other expenses. |
Exit cost obligations
Exit cost obligations | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Exit cost obligations | Note 13: Exit cost obligations During December 2015, the Bank agreed to commence an orderly wind-down of the deposit taking and investment management businesses in the United Kingdom jurisdiction in the Channel Islands and the UK segment as reflected in management segment reporting described in Note 15: Segmented information . In making this determination, the Bank considered the increasing regulatory pressure along with periods of negative profitability and made the determination that an orderly wind-down of the deposit taking and investment management businesses in the United Kingdom was prudent for Butterfield as a group. The orderly wind-down was largely completed by the end of 2016 with the change in business operations to mortgage lending services and the change in name from Butterfield Bank (UK) Limited to Butterfield Mortgages Limited. The amounts expensed shown in the following table are all included in the consolidated statements of operations as restructuring costs under non-interest expenses. Related to this orderly wind-down, it was determined that the core banking system utilized in the operations of the United Kingdom jurisdiction was impaired (included in premises, equipment and computer software on the consolidated balance sheets). This determination was based upon the realizable value of this software upon completion of the orderly wind-down. A total of $5.1 million was expensed in the fourth quarter of the year ended December 31, 2015 and was included in impairment of fixed assets on the consolidated statements of operations of the relevant period. Expense recognized by year Amounts paid by year Exit cost liability Year ended December 31, 2018 Years 2017, 2016 and 2015 Costs to be recognized in the future Total exit costs expected to be incurred Year ended December 31, 2018 Years 2017, 2016 and 2015 As at December 31, 2018 As at December 31, 2017 Staff redundancy expenses — 3,680 — 3,680 — 3,680 — — Professional services — 4,388 — 4,388 — 4,388 — — Lease termination expenses — 649 — 649 — 649 — — Other expenses — 1,504 — 1,504 — 1,504 — — Total — 10,221 — 10,221 — 10,221 — — |
Loan interest income
Loan interest income | 12 Months Ended |
Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |
Loan interest income | Note 14: Loan interest income Year ended Contractual interest December 31, 2018 December 31, 2017 December 31, 2016 Contractual interest earned on mortgages 136,984 125,980 122,541 Contractual interest earned on other loans 76,924 57,591 62,788 Subtotal contractual interest earned 213,908 183,571 185,329 Amortization Amortization of fair value hedge (501 ) (722 ) (1,120 ) Amortization of loan origination fees (net of amortized costs) 5,088 4,171 3,791 Total loan interest income 218,495 187,020 188,000 Balance of unamortized fair value hedge included in loans as at year end 1,992 2,493 3,215 Balance of unamortized loan fees included in loans as at year end 10,010 9,364 6,313 |
Segmented information
Segmented information | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Segmented information | Note 15: Segmented information The Bank is managed by the CEO on a geographic basis. In 2017, the Bank presented six segments which included Bermuda, Cayman, Guernsey, Switzerland, The Bahamas and the United Kingdom. In 2018, the Bank reassessed the segment reporting as a result of acquisitions which were announced in 2017 and early 2018 and concluded on the following three geographic segments: Bermuda, Cayman, and Channel Islands and the UK. The Other segment is composed of several non-reportable operating segments that have been aggregated in accordance with US GAAP. Each region has a managing director who reports to the CEO. The CEO and the region managing director have final authority over resource allocation decisions and performance assessment. The Bank also revised the presentation of total assets by segment to exclude the effect of investment in subsidiaries from the total assets in each segment. The 2016 and 2017 classifications presented below were revised to conform the presentation for all periods to the current period's presentation. The geographic segments reflect this management structure and the manner in which financial information is currently evaluated by the CEO. Segment results are determined based on the Bank's management reporting system, which assigns balance sheet and income statement items to each of the geographic segments. The process is designed around the Bank's organizational and management structure and, accordingly, the results derived are not necessarily comparable with similar information published by other financial institutions. A description of each reportable segment and table of financial results is presented below. Accounting policies of the reportable segments are the same as those described in Note 2: Significant accounting policies. Transactions between segments are accounted for on an accrual basis and are all eliminated upon consolidation. The Bank generally does not allocate assets, revenues and expenses among its business segments, with the exception of certain corporate overhead expenses and loan participation revenue and expense. Loan participation revenue and expenses are allocated pro-rata based upon the percentage of the total loan funded by each jurisdiction participating in the loan. The Bermuda segment provides a full range of retail, commercial and private banking services. Retail services are offered to individuals and small to medium-sized businesses through four branch locations and through internet banking, mobile banking, automated teller machines (“ATMs”) and debit cards. Retail services include deposit services, consumer and mortgage lending, credit cards and personal insurance products. Commercial banking includes commercial lending and mortgages, cash management, payroll services, remote banking and letters of credit. Treasury services include money market and foreign exchange activities. Bermuda’s wealth management offering consists of Butterfield Asset Management Limited, which provides investment management, advisory and brokerage services and Butterfield Trust (Bermuda) Limited, which provides trust, estate, company management and custody services. Bermuda is also the location of Bank's head offices and accordingly, retains the unallocated corporate overhead expenses. The Cayman segment provides a comprehensive range of retail, commercial and private banking services. Retail services are offered to individuals and small to medium-sized businesses through three branch locations and through internet banking, mobile banking, ATMs and debit cards. Retail services include deposit services, consumer and mortgage lending, credit cards and property/auto insurance. Commercial banking includes commercial lending and mortgages, cash management, payroll services, remote banking and letters of credit. Treasury services include money market and foreign exchange activities. Cayman’s wealth management offering comprises investment management, advisory and brokerage services and Butterfield Trust (Cayman) Limited, which provides trust, estate and company management. The Channel Islands and the UK segment includes the jurisdictions of Guernsey and Jersey (Channel Islands), and the UK. In the Channel Islands, a broad range of services are provided to private clients and financial institutions including private banking and treasury services, internet banking, wealth management and fiduciary services. The UK jurisdiction provides mortgage services for high-value residential properties. The Other segment includes the jurisdictions of the Bahamas, Canada, Mauritius, Singapore and Switzerland. These operating segments individually and collectively do not meet the quantitative threshold for segmented reporting and are therefore aggregated as non-reportable operating segments. Total Assets by Segment December 31, 2018 December 31, 2017 Bermuda 5,387,347 6,053,546 Cayman 3,705,468 3,242,343 Channel Islands and the UK 1,966,547 1,586,134 Other 30,035 13,859 Total assets before inter-segment eliminations 11,089,397 10,895,882 Less: inter-segment eliminations (316,219 ) (116,645 ) Total 10,773,178 10,779,237 2018 Net interest income Provision for credit losses Non-interest income Revenue before gains and losses Gains and losses Total net revenue Total expenses Net income Year ended December 31 Customer Inter- segment Bermuda 202,901 2,383 6,823 87,352 299,459 (20 ) 299,439 202,318 97,121 Cayman 102,793 416 1,297 47,781 152,287 349 152,636 60,666 91,970 Channel Islands and the UK 37,276 (2,799 ) (1,129 ) 26,824 60,172 (1,185 ) 58,987 50,353 8,634 Other 19 — — 15,157 15,176 1 15,177 17,718 (2,541 ) Total before eliminations 342,989 — 6,991 177,114 527,094 (855 ) 526,239 331,055 195,184 Inter-segment eliminations — — — (8,428 ) (8,428 ) — (8,428 ) (8,428 ) — Total 342,989 — 6,991 168,686 518,666 (855 ) 517,811 322,627 195,184 2017 Net interest income Provision for credit losses Non-interest income Revenue before gains and losses Gains and losses Total net revenue Total expenses Net income Year ended December 31 Customer Inter- segment Bermuda 178,600 1,324 4,618 81,416 265,958 2,785 268,743 192,293 76,450 Cayman 86,074 3 1,033 46,004 133,114 (28 ) 133,086 59,400 73,686 Channel Islands and the UK 24,978 (1,367 ) 186 24,445 48,242 (1,488 ) 46,754 43,758 2,996 Other 92 40 — 11,424 11,556 — 11,556 11,436 120 Total before eliminations 289,744 — 5,837 163,289 458,870 1,269 460,139 306,887 153,252 Inter-segment eliminations — — — (5,464 ) (5,464 ) — (5,464 ) (5,464 ) — Total 289,744 — 5,837 157,825 453,406 1,269 454,675 301,423 153,252 2016 Net interest income Provision for credit losses Non-interest income Revenue before gains and losses Gains and losses Total net revenue Total expenses Net income Year ended December 31 Customer Inter- segment Bermuda 160,466 1,642 (7,263 ) 71,765 226,610 1,412 228,022 164,581 63,441 Cayman 79,644 388 2,135 41,364 123,531 (532 ) 122,999 60,613 62,386 Channel Islands and the UK 18,283 (2,060 ) 729 28,155 45,107 134 45,241 55,387 (10,146 ) Other 87 30 — 9,194 9,311 — 9,311 9,050 261 Total before eliminations 258,480 — (4,399 ) 150,478 404,559 1,014 405,573 289,631 115,942 Inter-segment eliminations — — — (3,005 ) (3,005 ) — (3,005 ) (3,005 ) — Total 258,480 — (4,399 ) 147,473 401,554 1,014 402,568 286,626 115,942 |
Derivative instruments and risk
Derivative instruments and risk management | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative instruments and risk management | Note 16: Derivative instruments and risk management The Bank uses derivatives for risk management purposes and to meet the needs of its customers. The Bank’s derivative contracts principally involve over-the-counter (“OTC”) transactions that are negotiated privately between the Bank and the counterparty to the contract and include interest rate contracts and foreign exchange contracts. The Bank may pursue opportunities to reduce its exposure to credit losses on derivatives by entering into International Swaps and Derivatives Association master agreements (“ISDAs”). Depending on the nature of the derivative transaction, bilateral collateral arrangements may be used, as well. When the Bank is engaged in more than one outstanding derivative transaction with the same counterparty, and also has a legally enforceable master netting agreement with that counterparty, the net marked-to-market exposure represents the netting of the positive and negative exposures with that counterparty. When there is a net negative exposure, the Bank regards its credit exposure to the counterparty as being zero. The net marked-to-market position with a particular counterparty represents a reasonable measure of credit risk when there is a legally enforceable master netting agreement between the Bank and that counterparty. Certain of these agreements contain credit risk-related contingent features in which the counterparty has the option to accelerate cash settlement of the Bank's net derivative liabilities with the counterparty in the event the Bank's credit rating falls below specified levels or the liabilities reach certain levels. All derivative financial instruments, whether designated as hedges or not, are recorded on the consolidated balance sheets at fair value within other assets or other liabilities. These amounts include the effect of netting. The accounting for changes in the fair value of a derivative in the consolidated statements of operations depends on whether the contract has been designated as a hedge and qualifies for hedge accounting. Notional Amounts The notional amounts are not recorded as assets or liabilities on the consolidated balance sheets as they represent the face amount of the contract to which a rate or price is applied to determine the amount of cash flows to be exchanged. Notional amounts represent the volume of outstanding transactions and do not represent the potential gain or loss associated with market risk or credit risk of such instruments. Credit risk is limited to the positive fair value of the derivative instrument, which is significantly less than the notional amount. Fair Value Derivative instruments, in the absence of any compensating up-front cash payments, generally have no market value at inception. They obtain value, positive or negative, as relevant interest rates, exchange rates, equity or commodity prices or indices change. The potential for derivatives to increase or decrease in value as a result of the foregoing factors is generally referred to as market risk. Market risk is managed within clearly defined parameters as prescribed by senior management of the Bank. The fair value is defined as the profit or loss associated with replacing the derivative contracts at prevailing market prices. Risk Management Derivatives The Bank enters into interest derivative contracts as part of its overall interest rate risk management strategy to minimize significant unplanned fluctuations in earnings that are caused by interest rate volatility. The Bank’s goal is to manage interest rate sensitivity by modifying the repricing or maturity characteristics of certain consolidated balance sheet assets and liabilities so that movements in interest rates do not adversely affect the net interest margin. Derivative instruments that are used as part of the Bank’s risk management strategy include interest rate swap contracts that have indices related to the pricing of specific consolidated balance sheet assets and liabilities. Interest rate swaps generally involve the exchange of fixed and variable-rate interest payments between two parties, based on a common notional principal amount and maturity date. The Bank uses foreign currency derivative instruments to hedge its exposure to foreign currency risk. Certain hedging relationships are formally designated and qualify for hedge accounting as fair value or net investment hedges. Risk management derivatives comprise fair value hedges, net investment hedges and derivatives not formally designated as hedges as described below. Fair value hedges consist of designated interest rate swaps and are used to minimize the Bank's exposure to changes in the fair value of assets and liabilities due to movements in interest rates. The Bank previously entered into interest rate swaps to convert its fixed-rate long-term loans to floating-rate loans, and convert fixed-rate deposits to floating-rate deposits. During the year ended December 31, 2011, the Bank canceled its interest rate swaps designated as fair value hedges of loans receivable and therefore discontinued hedge accounting for these financial instruments. The fair value attributable to the hedged loans are accounted for prospectively and are being amortized to net income over the remaining life of each individual loan, which could extend to year 2029, using the effective interest method. Net investment hedges includes designated currency swaps and qualifying non-derivative instruments and are used to minimize the Bank’s exposure to variability in the foreign currency translation of net investments in foreign operations. The effective portion of changes in the fair value of the hedging instrument is recognized in AOCL consistent with the related translation gains and losses of the hedged net investment. For net investment hedges, all critical terms of the hedged item and the hedging instrument are matched at inception and on an ongoing basis to minimize the risk of hedge ineffectiveness. For derivatives designated as net investment hedges, the Bank follows the method based on changes in spot exchange rates. Accordingly: - The change in the fair value of the derivative instrument that is reported in AOCL (i.e., the effective portion) is determined by the changes in spot exchange rates. - The change in the fair value of the derivative instrument attributable to changes in the difference between the forward rate and spot rate are excluded from the measure of the hedge ineffectiveness and that difference is reported directly in the consolidated statements of operations under foreign exchange revenue. Amounts recorded in AOCL are reclassified to earnings only upon the sale or substantial liquidation of an investment in a foreign subsidiary. For foreign-currency-denominated debt instruments that are designated as hedges of net investments in foreign operations, the translation gain or loss that is recorded in AOCL is based on the spot exchange rate between the reporting currency of the Bank and the functional currency of the respective subsidiary. See Note 23: Accumulated other comprehensive loss for details on the amount recognized into AOCL during the current period from translation gain or loss. Derivatives not formally designated as hedges are entered into to manage the interest rate risk of fixed rate deposits and foreign exchange risk of the Bank's exposure. Changes in the fair value of derivative instruments not formally designated as hedges are recognized in foreign exchange income. Client service derivatives The Bank enters into foreign exchange contracts and interest rate caps primarily to meet the foreign exchange needs of its customers. Foreign exchange contracts are agreements to exchange specific amounts of currencies at a future date at a specified rate of exchange. Changes in the fair value of client services derivative instruments are recognized in foreign exchange income. The following table shows the aggregate notional amounts of derivative contracts outstanding listed by type and respective gross positive or negative fair values and classified by those used for risk management (sub-classified as hedging and those that do not qualify for hedge accounting), client services and credit derivatives. Fair value of derivatives is recorded in the consolidated balance sheets in other assets and other liabilities. Gross positive fair values are recorded in other assets and gross negative fair values are recorded in other liabilities, subject to netting when master netting agreements are in place. December 31, 2018 Derivative instrument Number of contracts Notional amounts Gross positive fair value Gross negative fair value Net fair value Risk management derivatives Derivatives not formally designated as hedging instruments Currency swaps 8 238,810 269 (601 ) (332 ) Client services derivatives Spot and forward foreign exchange 288 2,064,762 13,331 (12,671 ) 660 Total derivative instruments 2,303,572 13,600 (13,272 ) 328 December 31, 2017 Derivative instrument Number of contracts Notional amounts Gross positive fair value Gross negative fair value Net fair value Risk management derivatives Derivatives not formally designated as hedging instruments Currency swaps 8 183,719 726 (2,754 ) (2,028 ) Client services derivatives Spot and forward foreign exchange 120 2,130,224 10,595 (9,911 ) 684 Total derivative instruments 2,313,943 11,321 (12,665 ) (1,344 ) In addition to the above, as at December 31, 2018 foreign denominated deposits of £124.5 million ( December 31, 2017 : £84.5 million ), CHF 0.4 million (December 31, 2017: CHF 0.4 million ), and SGD 4.0 million (December 31, 2017: nil ) were designated as a hedge of foreign exchange risk associated with the net investment in foreign operations. We manage derivative exposure by monitoring the credit risk associated with each counterparty using counterparty specific credit risk limits, using master netting arrangements where appropriate and obtaining collateral. The Bank elected to offset in the consolidated balance sheets certain gross derivative assets and liabilities subject to netting agreements. The Bank also elected not to offset certain derivative assets or liabilities and all collaterals received or paid that the Bank or the counterparties could legally offset in the event of default. In the tables below, these positions are deducted from the net fair value presented in the consolidated balance sheets in order to present the net exposures. The collateral values presented in the following table are limited to the related net derivative asset or liability balance and, accordingly, do not include excess collateral received or paid. Gross fair Less: offset applied under master netting agreements Net fair value presented in the consolidated balance sheets Less: positions not offset in the consolidated balance sheets December 31, 2018 Gross fair value of derivatives Cash collateral received / paid Net exposures Derivative assets Spot and forward foreign exchange and currency swaps 13,600 (2,036 ) 11,564 — (3,216 ) 8,348 Derivative liabilities Spot and forward foreign exchange and currency swaps 13,272 (2,036 ) 11,236 — (1,861 ) 9,375 Net positive fair value 328 Gross fair Less: offset applied under master netting agreements Net fair value presented in the consolidated balance sheets Less: positions not offset in the consolidated balance sheets December 31, 2017 Gross fair value of derivatives Cash collateral received / paid Net exposures Derivative assets Spot and forward foreign exchange and currency swaps 11,321 (2,197 ) 9,124 — (6,196 ) 2,928 Derivative liabilities Spot and forward foreign exchange and currency swaps 12,665 (2,197 ) 10,468 — — 10,468 Net negative fair value (1,344 ) The following tables show the location and amount of gains (losses) recorded in either the consolidated statements of operations or consolidated statements of comprehensive income on derivative instruments outstanding. During 2016, management revised the following disclosures to segregate the gains and losses attributable to the specific types of derivatives. Year ended Derivative instrument Consolidated statements of operations line item December 31, 2018 December 31, 2017 December 31, 2016 Spot and forward foreign exchange Foreign exchange revenue (25 ) 541 (322 ) Currency swaps, not designated as hedge Foreign exchange revenue 1,697 (4,916 ) 2,710 Currency swaps - net investment hedge Foreign exchange revenue — (11,334 ) (1,091 ) Total net gains (losses) recognized in net income 1,672 (15,709 ) 1,297 Derivative instrument Consolidated statements of comprehensive income line item December 31, 2018 December 31, 2017 December 31, 2016 Currency swaps - net investment hedge Net change in unrealized gains and (losses) on translation of net investment in foreign operations — (4,410 ) 12,713 Total net gains (losses) recognized in comprehensive income — (4,410 ) 12,713 |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Note 17: Fair value measurements The following table presents the financial assets and liabilities that are measured at fair value on a recurring basis. Management classifies these items based on the type of inputs used in their respective fair value determination as described in Note 2: Significant accounting policies . Management reviews the price of each security monthly, comparing market values to expectations and to the prior month’s price. Management's expectations are based upon knowledge of prevailing market conditions and developments relating to specific issuers and/or asset classes held in the investment portfolio. Where there are unusual or significant price movements, or where a certain asset class has performed out-of-line with expectations, the matter is reviewed by management. Financial instruments in Level 1 include actively traded redeemable mutual funds. Financial instruments in Level 2 include corporate bonds, mortgage-backed securities and other asset-backed securities, forward foreign exchange contracts and mutual funds not actively traded. Financial instruments in Level 3 include asset-backed securities for which the market is relatively illiquid and for which information about actual trading prices is not readily available. There were no transfers between Level 1 and Level 2 or Level 2 and Level 3 during the year ended December 31, 2018 and the year ended December 31, 2017 . December 31, 2018 December 31, 2017 Fair value Total carrying amount / fair value Fair value Total carrying amount / fair value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Items that are recognized at fair value on a recurring basis: Financial assets Trading investments Mutual funds 6,176 319 — 6,495 6,616 208 — 6,824 Total trading 6,176 319 — 6,495 6,616 208 — 6,824 Available-for-sale investments US government and federal agencies — 1,786,507 — 1,786,507 — 2,709,104 — 2,709,104 Non-US governments debt securities — 25,425 — 25,425 — 26,248 — 26,248 Corporate debt securities — 78,713 — 78,713 — 243,372 — 243,372 Asset-backed securities - Student loans — — 12,626 12,626 — — 12,493 12,493 Commercial mortgage-backed securities — 123,209 — 123,209 — 141,500 — 141,500 Residential mortgage-backed securities — 156,269 — 156,269 — 184,723 — 184,723 Total available-for-sale — 2,170,123 12,626 2,182,749 — 3,304,947 12,493 3,317,440 Other assets - Derivatives — 11,564 — 11,564 — 9,124 — 9,124 Financial liabilities Other liabilities - Derivatives — 11,236 — 11,236 — 10,468 — 10,468 Level 3 Reconciliation The Level 3, shown as Asset-backed securities - Student loans in the above table, is a federal family education loan program guaranteed student loan security and is valued using a non-binding broker quote. The fair value provided by the broker is based on the last trading price of similar securities but as the market for the security is illiquid, a Level 2 classification is not supported. December 31, 2018 December 31, 2017 December 31, 2016 Available- for-sale investments Available- for-sale investments Available- Carrying amount at beginning of year 12,493 12,493 12,161 Realized and unrealized gains (losses) recognized in other comprehensive income 133 — 332 Carrying amount at end of year 12,626 12,493 12,493 Items Other Than Those Recognized at Fair Value on a Recurring Basis: December 31, 2018 December 31, 2017 Level Carrying amount Fair value Appreciation / (depreciation) Carrying amount Fair value Appreciation / (depreciation) Financial assets Cash due from banks Level 1 2,053,883 2,053,883 — 1,535,138 1,535,138 — Securities purchased under agreement to resell Level 2 27,341 27,341 — 178,769 178,769 — Short-term investments Level 1 52,336 52,336 — 249,984 249,984 — Investments held-to-maturity Level 2 2,066,120 2,036,214 (29,906 ) 1,381,955 1,377,354 (4,601 ) Loans, net of allowance for credit losses Level 2 4,043,889 4,047,262 3,373 3,776,862 3,770,450 (6,412 ) Other real estate owned¹ Level 2 5,346 5,346 — 9,127 9,127 — Financial liabilities Customer deposits Demand deposits Level 2 7,449,843 7,449,843 — 7,813,654 7,813,654 — Term deposits Level 2 1,968,576 1,970,004 (1,428 ) 1,710,338 1,710,223 115 Deposits from banks Level 2 33,822 33,822 — 12,466 12,466 — Long-term debt Level 2 143,322 146,261 (2,939 ) 117,000 118,321 (1,321 ) ¹ The current carrying value of OREO is adjusted to fair value only when there is devaluation below carrying value. Note 18: Interest rate risk The following tables set out the assets, liabilities and shareholders' equity and off-balance sheet instruments on the date of the earlier of contractual maturity, expected maturity or repricing date. Use of these tables to derive information about the Bank’s interest rate risk position is limited by the fact that customers may choose to terminate their financial instruments at a date earlier than the contractual maturity or repricing date. Examples of this include fixed-rate mortgages, which are shown at contractual maturity but which may pre-pay earlier, and certain term deposits, which are shown at contractual maturity but which may be withdrawn before their contractual maturity subject to prepayment penalties. Investments are shown based on remaining contractual maturities. The remaining contractual principal maturities for mortgage-backed securities (primarily US government agencies) do not consider prepayments. Remaining expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations before the underlying mortgages mature. December 31, 2018 Earlier of contractual maturity or repricing date (in $ millions) Within 3 months 3 to 6 months 6 to 12 months 1 to 5 years After 5 years Non-interest bearing funds Total Assets Cash due from banks 1,930 — — — — 124 2,054 Securities purchased under agreement to resell 27 — — — — — 27 Short-term investments 40 10 — — — 2 52 Investments 488 35 8 245 3,473 6 4,255 Loans 3,160 278 38 223 330 15 4,044 Other assets — — — — — 341 341 Total assets 5,645 323 46 468 3,803 488 10,773 Liabilities and shareholders' equity Shareholders’ equity — — — — — 882 882 Demand deposits 5,357 — — — — 2,120 7,477 Term deposits 1,245 228 432 70 — — 1,975 Other liabilities — — — — — 296 296 Long-term debt 70 — — 73 — — 143 Total liabilities and shareholders' equity 6,672 228 432 143 — 3,298 10,773 Interest rate sensitivity gap (1,027 ) 95 (386 ) 325 3,803 (2,810 ) — Cumulative interest rate sensitivity gap (1,027 ) (932 ) (1,318 ) (993 ) 2,810 — — December 31, 2017 Earlier of contractual maturity or repricing date (in $ millions) Within 3 months 3 to 6 months 6 to 12 months 1 to 5 years After 5 years Non-interest bearing funds Total Assets Cash due from banks 1,446 — — — — 89 1,535 Securities purchased under agreement to resell 179 — — — — — 179 Short-term investments 163 87 — — — — 250 Investments 1,464 62 15 390 2,768 7 4,706 Loans 3,457 44 34 194 44 4 3,777 Other assets — — — — — 332 332 Total assets 6,709 193 49 584 2,812 432 10,779 Liabilities and shareholders' equity Shareholders’ equity — — — — — 823 823 Demand deposits 5,342 — — — — 2,480 7,822 Term deposits 1,340 132 183 59 — — 1,714 Other liabilities — — — — — 303 303 Long-term debt 92 25 — — — — 117 Total liabilities and shareholders' equity 6,774 157 183 59 — 3,606 10,779 Interest rate sensitivity gap (65 ) 36 (134 ) 525 2,812 (3,174 ) — Cumulative interest rate sensitivity gap (65 ) (29 ) (163 ) 362 3,174 — — |
Interest rate risk
Interest rate risk | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Interest rate risk | Note 17: Fair value measurements The following table presents the financial assets and liabilities that are measured at fair value on a recurring basis. Management classifies these items based on the type of inputs used in their respective fair value determination as described in Note 2: Significant accounting policies . Management reviews the price of each security monthly, comparing market values to expectations and to the prior month’s price. Management's expectations are based upon knowledge of prevailing market conditions and developments relating to specific issuers and/or asset classes held in the investment portfolio. Where there are unusual or significant price movements, or where a certain asset class has performed out-of-line with expectations, the matter is reviewed by management. Financial instruments in Level 1 include actively traded redeemable mutual funds. Financial instruments in Level 2 include corporate bonds, mortgage-backed securities and other asset-backed securities, forward foreign exchange contracts and mutual funds not actively traded. Financial instruments in Level 3 include asset-backed securities for which the market is relatively illiquid and for which information about actual trading prices is not readily available. There were no transfers between Level 1 and Level 2 or Level 2 and Level 3 during the year ended December 31, 2018 and the year ended December 31, 2017 . December 31, 2018 December 31, 2017 Fair value Total carrying amount / fair value Fair value Total carrying amount / fair value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Items that are recognized at fair value on a recurring basis: Financial assets Trading investments Mutual funds 6,176 319 — 6,495 6,616 208 — 6,824 Total trading 6,176 319 — 6,495 6,616 208 — 6,824 Available-for-sale investments US government and federal agencies — 1,786,507 — 1,786,507 — 2,709,104 — 2,709,104 Non-US governments debt securities — 25,425 — 25,425 — 26,248 — 26,248 Corporate debt securities — 78,713 — 78,713 — 243,372 — 243,372 Asset-backed securities - Student loans — — 12,626 12,626 — — 12,493 12,493 Commercial mortgage-backed securities — 123,209 — 123,209 — 141,500 — 141,500 Residential mortgage-backed securities — 156,269 — 156,269 — 184,723 — 184,723 Total available-for-sale — 2,170,123 12,626 2,182,749 — 3,304,947 12,493 3,317,440 Other assets - Derivatives — 11,564 — 11,564 — 9,124 — 9,124 Financial liabilities Other liabilities - Derivatives — 11,236 — 11,236 — 10,468 — 10,468 Level 3 Reconciliation The Level 3, shown as Asset-backed securities - Student loans in the above table, is a federal family education loan program guaranteed student loan security and is valued using a non-binding broker quote. The fair value provided by the broker is based on the last trading price of similar securities but as the market for the security is illiquid, a Level 2 classification is not supported. December 31, 2018 December 31, 2017 December 31, 2016 Available- for-sale investments Available- for-sale investments Available- Carrying amount at beginning of year 12,493 12,493 12,161 Realized and unrealized gains (losses) recognized in other comprehensive income 133 — 332 Carrying amount at end of year 12,626 12,493 12,493 Items Other Than Those Recognized at Fair Value on a Recurring Basis: December 31, 2018 December 31, 2017 Level Carrying amount Fair value Appreciation / (depreciation) Carrying amount Fair value Appreciation / (depreciation) Financial assets Cash due from banks Level 1 2,053,883 2,053,883 — 1,535,138 1,535,138 — Securities purchased under agreement to resell Level 2 27,341 27,341 — 178,769 178,769 — Short-term investments Level 1 52,336 52,336 — 249,984 249,984 — Investments held-to-maturity Level 2 2,066,120 2,036,214 (29,906 ) 1,381,955 1,377,354 (4,601 ) Loans, net of allowance for credit losses Level 2 4,043,889 4,047,262 3,373 3,776,862 3,770,450 (6,412 ) Other real estate owned¹ Level 2 5,346 5,346 — 9,127 9,127 — Financial liabilities Customer deposits Demand deposits Level 2 7,449,843 7,449,843 — 7,813,654 7,813,654 — Term deposits Level 2 1,968,576 1,970,004 (1,428 ) 1,710,338 1,710,223 115 Deposits from banks Level 2 33,822 33,822 — 12,466 12,466 — Long-term debt Level 2 143,322 146,261 (2,939 ) 117,000 118,321 (1,321 ) ¹ The current carrying value of OREO is adjusted to fair value only when there is devaluation below carrying value. Note 18: Interest rate risk The following tables set out the assets, liabilities and shareholders' equity and off-balance sheet instruments on the date of the earlier of contractual maturity, expected maturity or repricing date. Use of these tables to derive information about the Bank’s interest rate risk position is limited by the fact that customers may choose to terminate their financial instruments at a date earlier than the contractual maturity or repricing date. Examples of this include fixed-rate mortgages, which are shown at contractual maturity but which may pre-pay earlier, and certain term deposits, which are shown at contractual maturity but which may be withdrawn before their contractual maturity subject to prepayment penalties. Investments are shown based on remaining contractual maturities. The remaining contractual principal maturities for mortgage-backed securities (primarily US government agencies) do not consider prepayments. Remaining expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations before the underlying mortgages mature. December 31, 2018 Earlier of contractual maturity or repricing date (in $ millions) Within 3 months 3 to 6 months 6 to 12 months 1 to 5 years After 5 years Non-interest bearing funds Total Assets Cash due from banks 1,930 — — — — 124 2,054 Securities purchased under agreement to resell 27 — — — — — 27 Short-term investments 40 10 — — — 2 52 Investments 488 35 8 245 3,473 6 4,255 Loans 3,160 278 38 223 330 15 4,044 Other assets — — — — — 341 341 Total assets 5,645 323 46 468 3,803 488 10,773 Liabilities and shareholders' equity Shareholders’ equity — — — — — 882 882 Demand deposits 5,357 — — — — 2,120 7,477 Term deposits 1,245 228 432 70 — — 1,975 Other liabilities — — — — — 296 296 Long-term debt 70 — — 73 — — 143 Total liabilities and shareholders' equity 6,672 228 432 143 — 3,298 10,773 Interest rate sensitivity gap (1,027 ) 95 (386 ) 325 3,803 (2,810 ) — Cumulative interest rate sensitivity gap (1,027 ) (932 ) (1,318 ) (993 ) 2,810 — — December 31, 2017 Earlier of contractual maturity or repricing date (in $ millions) Within 3 months 3 to 6 months 6 to 12 months 1 to 5 years After 5 years Non-interest bearing funds Total Assets Cash due from banks 1,446 — — — — 89 1,535 Securities purchased under agreement to resell 179 — — — — — 179 Short-term investments 163 87 — — — — 250 Investments 1,464 62 15 390 2,768 7 4,706 Loans 3,457 44 34 194 44 4 3,777 Other assets — — — — — 332 332 Total assets 6,709 193 49 584 2,812 432 10,779 Liabilities and shareholders' equity Shareholders’ equity — — — — — 823 823 Demand deposits 5,342 — — — — 2,480 7,822 Term deposits 1,340 132 183 59 — — 1,714 Other liabilities — — — — — 303 303 Long-term debt 92 25 — — — — 117 Total liabilities and shareholders' equity 6,774 157 183 59 — 3,606 10,779 Interest rate sensitivity gap (65 ) 36 (134 ) 525 2,812 (3,174 ) — Cumulative interest rate sensitivity gap (65 ) (29 ) (163 ) 362 3,174 — — |
Long-term debt
Long-term debt | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-term debt | Note 19: Long-term debt On May 28, 2003, the Bank issued US $125 million of Subordinated Lower Tier II capital notes. The notes were issued at par and in two tranches, namely US $78 million in Series A notes due 2013 and US $47 million in Series B notes due 2018. The issuance was by way of private placement with US institutional investors. The notes are listed on the Bermuda Stock Exchange (“BSX”) in the specialist debt securities category. Part of the proceeds of the issue were used to repay the entire amount of the US $75 million outstanding subordinated notes redeemed in July 2003. The notes issued under Series A paid a fixed coupon of 3.94% until May 27, 2008 when it was redeemed in whole by the Bank. The Series B notes paid a fixed coupon of 5.15% until May 27, 2013 when they became redeemable in whole at the Bank’s option. The Series B notes were priced at a spread of 1.35% over the 10-year US Treasury yield. In May 2018, the Bank fully redeemed the 2003 issuance Series B for its nominal value of $47 million . On June 27, 2005, the Bank issued US $150 million of Subordinated Lower Tier II capital notes. The notes were issued at par in two tranches, namely US $90 million in Series A notes due 2015 and US $60 million in Series B notes due 2020. The issuance was by way of private placement with US institutional investors. The notes are listed on the BSX in the specialist debt securities category. The notes issued under Series A paid a fixed coupon of 4.81% until July 2, 2010 after which the coupon rate became floating and the principal became redeemable in whole at the Bank's option. The Series B notes paid a fixed coupon of 5.11% until July 2, 2015 when they also became redeemable in whole at the Bank’s option. The Series A notes were priced at a spread of 1.00% over the five-year US Treasury yield and the Series B notes were priced at a spread of 1.10% over the 10-year US Treasury yield. During September 2011, the Bank repurchased a portion of the outstanding 5.11% 2005 Series B Subordinated notes (“the Note”). The face value of the portion of the Note repurchased was $15 million and the purchase price paid for the repurchase was $13.875 million , which realized a gain of $1.125 million . During January 2014, the Bank fully redeemed the 2005 issuance Series A subordinated debt for its nominal value of $90 million . On May 27, 2008, the Bank issued US $78 million of Subordinated Lower Tier II capital notes. The notes were issued at par and in two tranches, namely US $53 million in Series A notes due 2018 and US $25 million in Series B notes due 2023. The issuance was by way of private placement with US institutional investors. The notes are listed on the BSX in the specialist debt securities category. The proceeds of the issue were used to repay the entire amount of the US $78 million outstanding subordinated notes redeemed in May 2008. The notes issued under Series A paid a fixed coupon of 7.59% until May 27, 2013 when they became redeemable in whole at the option of the Bank. In May 2013, the Bank exercised its option to redeem the Series A note outstanding at face value. The Series B notes pay a fixed coupon of 8.44% until May 27, 2018 when they become redeemable in whole at the Bank’s option. The Series B notes were priced at a spread of 4.51% over the 10-year US Treasury yield. On May 24, 2018, the Bank issued US $75 million of Subordinated Lower Tier II capital notes. The notes were issued at par and due on June 1, 2028. The issuance was by way of a registered offering with US institutional investors. The notes are listed on the Bermuda Stock Exchange (BSX) in the specialist debt securities category. The proceeds of the issue were used, among other, to repay the entire amount of the US $47 million outstanding subordinated notes series 2003-B. The notes issued pay a fixed coupon of 5.25% until June 1, 2023 when they become redeemable in whole at the option of the Bank. The notes were priced at a spread of 2.27% over the 10-year US Treasury yield. The Bank incurred $1.8 million of costs directly related to the issuance of these capital notes. These costs have been capitalized directly against the carrying value of these notes on the balance sheet, and will be amortized over the life of the notes. No interest was capitalized during the years ended December 31, 2018 , 2017 and 2016 . In the event the Bank would be in a position to redeem long-term debt, priority would go to the redemption of the higher interest-bearing Series, subject to availability relative to the earliest date the Series is redeemable at the Bank's option. The following table presents the contractual maturity and interest payments for long-term debt issued by the Bank as at December 31, 2018 . The interest payments are calculated until contractual maturity using the current LIBOR rates. Interest payments until contractual maturity Long-term debt Earliest date redeemable at the Bank's option Contractual maturity date Interest rate until date redeemable Interest rate from earliest date redeemable to contractual maturity Principal Outstanding Within 1 year 1 to 5 years After 5 years Bermuda 2005 issuance - Series B July 2, 2015 July 2, 2020 5.11 % 3 months US$ LIBOR + 1.695% 45,000 2,054 1,542 — 2008 issuance - Series B May 27, 2018 May 27, 2023 8.44 % 3 months US$ LIBOR + 4.929% 25,000 1,961 6,861 — 2018 issuance June 1, 2023 June 1, 2028 5.25 % 3 months US$ LIBOR + 2.255% 75,000 3,938 15,711 17,340 Total 145,000 7,953 24,114 17,340 Unamortized debt issuance costs (1,678 ) Long-term debt less unamortized debt issuance costs 143,322 |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings per share | Note 20: Earnings per share Earnings per share have been calculated using the weighted average number of common shares outstanding during the year after deduction of the shares held as treasury stock. The dilutive effect of share-based compensation plans was calculated using the treasury stock method, whereby the proceeds received from the exercise of share-based awards are assumed to be used to repurchase outstanding shares, using the average market price of the Bank’s shares for the year. Numbers of shares are expressed in thousands. During the year ended December 31, 2018 , options to purchase an average of 0.3 million ( 2017 : 0.9 million , 2016 : 2.6 million ) common shares were outstanding. During the year ended December 31, 2018 , the average number of outstanding awards of unvested common shares was 0.9 million ( 2017 : 0.9 million , 2016 : 0.8 million ). Only awards for which the sum of 1) the expense that will be recognized in the future (i.e., the unrecognized expense) and 2) its exercise price, if any, was lower than the average market price of the Bank‘s common shares were considered dilutive and, therefore, included in the computation of diluted earnings per share. An award's unrecognized expense is also considered to be the proceeds the employees would need to pay to purchase accelerated vesting of the awards. For purposes of calculating dilution, such proceeds are assumed to be used by the Bank to buy back common shares at the average market price. The weighted-average number of outstanding awards, net of the assumed weighted-average number of common shares bought back, is included in the number of diluted participating shares. A warrant, outstanding until the Bank repurchased it in December 2016, to purchase 0.43 million common shares issued to the Government of Bermuda in exchange for the Government's guarantee of the preference shares, with an exercise price per share of $34.72 was not included in the computation of earnings per share for the year ended December 31, 2016 because the exercise price was greater than the average market price of the Bank‘s common shares. Year ended December 31, 2018 December 31, 2017 December 31, 2016 Net income 195,184 153,252 115,942 Less: Preference dividends declared and guarantee fee — — (15,655 ) Less: Premium on preference share buyback and redemption — — (41,913 ) Net income attributable for common shareholders 195,184 153,252 58,374 Basic Earnings Per Share Weighted average number of common shares issued 55,159 54,296 49,128 Weighted average number of common shares held as treasury stock (213 ) — (506 ) Weighted average number of common shares (in thousands) 54,946 54,296 48,622 Basic Earnings Per Share 3.55 2.82 1.20 Diluted Earnings Per Share Weighted average number of common shares 54,946 54,296 48,622 Net dilution impact related to options to purchase common shares 223 561 607 Net dilution impact related to awards of unvested common shares 576 594 382 Weighted average number of diluted common shares (in thousands) 55,745 55,451 49,611 Diluted Earnings Per Share 3.50 2.76 1.18 |
Share-based payments
Share-based payments | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based payments | Note 21: Share-based payments The common shares transferred to employees under all share-based payments are either taken from the Bank's common treasury shares or from newly issued shares. All share-based payments are settled by the ultimate parent company, which pursuant to Bermuda law is not taxed on income. There are no income tax benefits in relation to the issue of such shares as a form of compensation. In conjunction with the 2010 capital raise, the Board of Directors approved the 2010 Omnibus Plan (the "2010 Plan"). Under the 2010 Plan, 5% of the Bank’s fully diluted common shares, equal to approximately 2.95 million shares, were initially available for grant to certain officers in the form of stock options or unvested shares awards. Both types of awards are detailed below. In 2012 and 2016, the Board of Directors approved an increase to the equivalent number of shares allowed to be granted under the 2010 Plan to respectively 5.0 million and 7.5 million shares. Stock Option Awards 1997 Stock Option Plan Prior to the capital raise on March 2, 2010, the Bank granted stock options to employees and Directors of the Bank that entitle the holder to purchase one common share at a subscription price equal to the market price on the effective date of the grant. Generally, the options granted vest 25 percent at the end of each year for four years, however as a result of the 2010 capital raise, the options granted under the Bank's 1997 Stock Option Plan to employees became fully vested and options awarded to certain executives were surrendered. 2010 Plan Under the 2010 Plan, options are awarded to Bank employees and executive management, based on predetermined vesting conditions that entitle the holder to purchase one common share at a subscription price usually equal to the price of the most recently traded common share when granted and have a term of 10 years. The subscription price is reduced for all special dividends declared by the Bank. Stock option awards granted under the 2010 Plan vest based on two specific types of vesting conditions i.e., time and performance conditions, as detailed below: Time vesting condition 50% of each option award was granted in the form of time vested options and vested 25% on each of the second, third, fourth and fifth anniversaries of the effective grant date. In addition to the time vesting conditions noted above, the options will generally vest immediately: • by reason of the employee’s death or disability, • upon termination, by the Bank, of the holder’s employment, unless if in relation with the holder’s misconduct, or • in limited circumstances and specifically approved by the Board, as stipulated in the holder’s employment contract. In the event of the employee’s resignation, any unvested portion of the awards shall generally be forfeited and any vested portion of the options shall generally remain exercisable during the 90 -day period following the termination date or, if earlier, until the expiration date, and any vested portion of the options not exercised as of the expiration of such period shall be forfeited without any consideration therefore. Performance vesting condition 50% of each option award was granted in the form of performance options and would vest (partially or fully) on a “valuation event” date (the date that any of the March 2, 2010 new investors transfers at least 5% of the total number of common shares or the date that there is a change in control and any of the new investors realize a predetermined multiple of invested capital (“MOIC”)). On September 21, 2016, it was determined that a valuation event occurred during which a new investor realized a MOIC of more than 200% of the original invested capital of $12.09 per share and accordingly, all outstanding unvested performance options vested. Changes in Outstanding Stock Options Number of shares transferable upon exercise (thousands) Weighted average exercise price ($) Weighted average remaining life (years) Aggregate intrinsic value ($ thousands) Year ended December 31, 2018 1997 Stock Option Plan 2010 Stock Option Plan Total 1997 Stock Option Plan 2010 Stock Option Plan 1997 Stock Option Plan 2010 Stock Option Plan Outstanding at beginning of year 58 476 534 113.46 11.73 Exercised — (287 ) (287 ) — 11.56 10,172 Forfeitures and cancellations (33 ) — (33 ) 150.46 — Outstanding at end of year 25 189 214 64.51 11.98 0.20 1.67 3,665 Vested and exercisable at end of year 25 189 214 64.51 11.98 0.20 1.67 Number of shares transferable upon exercise (thousands) Weighted average exercise price ($) Weighted average remaining life (years) Aggregate intrinsic value ($ thousands) Year ended December 31, 2017 1997 Stock Option Plan 2010 Stock Option Plan Total 1997 Stock Option Plan 2010 Stock Option Plan 1997 Stock Option Plan 2010 Stock Option Plan Outstanding at beginning of year 116 1,950 2,066 132.13 11.57 Exercised — (1,474 ) (1,474 ) — 11.51 32,333 Forfeitures and cancellations (58 ) — (58 ) 151.20 — Outstanding at end of year 58 476 534 113.46 11.73 0.63 2.48 11,700 Vested and exercisable at end of year 58 476 534 113.46 11.73 0.63 2.48 Number of shares transferable upon exercise (thousands) Weighted average exercise price ($) Weighted average remaining life (years) Aggregate intrinsic value ($ thousands) Year ended December 31, 2016 1997 Stock Option Plan 2010 Stock Option Plan Total 1997 Stock Option Plan 2010 Stock Option Plan 1997 Stock Option Plan 2010 Stock Option Plan Outstanding at beginning of year 218 2,608 2,826 135.19 11.60 Exercised — (625 ) (625 ) — 11.68 8,938 Forfeitures and cancellations (102 ) (5 ) (107 ) 138.79 11.50 Resignations — (28 ) (28 ) — 11.50 Outstanding at end of year 116 1,950 2,066 132.13 11.57 1.18 3.42 38,489 Vested and exercisable at end of year 116 1,950 2,066 132.13 11.57 1.18 3.42 Share-Based Plans Recipients of unvested share awards are entitled to the related common shares at no cost, at the time the award vests. Recipients of unvested shares may be entitled to receive additional unvested shares having a value equal to the cash dividends that would have been paid had the unvested shares been issued and vested. Such additional unvested shares granted as dividend equivalents are subject to the same vesting schedule and conditions as the underlying unvested shares. Unvested shares subject only to the time vesting condition generally vest upon retirement, death, disability or upon termination, by the Bank, of the holder’s employment unless if in connection with the holder’s misconduct. Unvested shares subject to both time vesting and performance vesting conditions remain outstanding and unvested upon retirement and will vest only if the performance conditions are met. Unvested shares can also vest in limited circumstances and if specifically approved by the Board, as stipulated in the holder’s employment contract. In all other circumstances, unvested shares are generally forfeited when employment ends. The grant date weighted average fair value of unvested share awards granted in the years ended December 31, 2018 , 2017 and 2016 was $39.25 , $31.13 and $19.34 respectively. The Bank expects to settle these awards by issuing new shares. Employee Deferred Incentive Plan (“EDIP”) Under the Bank’s EDIP Plan, shares were awarded to Bank employees and executive management based on the time vesting condition, which states that the shares will vest equally over a three -year period from the effective grant date. Executive Long-Term Incentive Share Plan (“ELTIP”) - Years 2013 - 2018 The 2018 ELTIP was approved on February 13, 2018. Under the Bank’s ELTIP plans for the years 2013 through 2018, performance shares as well as time-vested shares were awarded to executive management. The performance shares will generally vest upon the achievement of certain performance targets in the three -year period from the effective grant date. The time-vested shares will generally vest over the three -year period from the effective grant date. Changes in Outstanding ELTIP and EDIP awards (in thousands of shares transferable upon vesting) Year ended December 31, 2018 December 31, 2017 December 31, 2016 EDIP ELTIP EDIP ELTIP EDIP ELTIP Outstanding at beginning of year 244 679 215 640 226 606 Granted 130 241 132 236 115 360 Vested (fair value in 2018: $16.0 million, 2017: $10.2 million, 2016: $7.0 million) (138 ) (220 ) (102 ) (196 ) (118 ) (302 ) Resignations (2 ) (3 ) (1 ) (1 ) (8 ) (24 ) Outstanding at end of year 234 697 244 679 215 640 Share-based Compensation Cost Recognized in Net Income Year ended December 31, 2018 December 31, 2017 December 31, 2016 Stock option plans EDIP and ELTIP Total Stock option plans EDIP and ELTIP Total Stock option plans EDIP and ELTIP Total Cost recognized in net income — 11,664 11,664 — 8,110 8,110 8,697 5,375 14,072 Unrecognized Share-based Compensation Cost December 31, 2018 December 31, 2017 Unrecognized cost Weighted average years over which it is expected to be recognized Unrecognized cost Weighted average years over which it is expected to be recognized EDIP 4,442 1.73 3,453 1.85 ELTIP Time vesting shares 1,746 1.03 3,302 1.89 Performance vesting shares 7,880 1.85 5,010 1.78 Total unrecognized expense 14,068 11,765 |
Share buy-back plans
Share buy-back plans | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Share buy-back plans | Note 22: Share buy-back plans The Bank initially introduced two share buy-back programs on May 1, 2012 as a means to improve shareholder liquidity and facilitate growth in share value. Each program was approved by the Board of Directors for a period of 12 months, in accordance with the regulations of the BSX. The BSX must be advised monthly of shares purchased pursuant to each program. From time to time the Bank's associates, insiders and insiders' associates as defined by the BSX regulations may sell shares which may result in such shares being repurchased pursuant to each program, provided no more than any such person's pro-rata share of the listed securities is repurchased. Pursuant to the BSX regulations, all repurchases made by any issuer pursuant to a securities repurchase program must be made: (1) in the open market and not by private agreement; and (2) for a price not higher than the last independent trade for a round lot of the relevant class of securities. Common Share Buy-Back Program On February 19, 2016, the Board approved, with effect from April 1, 2016, the 2016 common share buy-back program, authorizing the purchase for treasury of up to 0.8 million common shares. On February 15, 2018, the Board approved, with effect on April 1, 2018, the 2018 common share buy-back program, authorizing the purchase for treasury of up to 1.0 million common shares. On December 6, 2018, the Board approved, with effect from December 10, 2018 to February 29, 2020, a common share buy-back program, authorizing the purchase for treasury of up to 2.5 million common shares. Year ended December 31 Common share buy-backs 2018 2017 2016 2015 2014 Total Acquired number of shares (to the nearest 1) 1,254,212 — 97,053 250,371 856,734 2,458,370 Average cost per common share 38.62 — 16.36 19.42 19.86 29.25 Total cost (in US dollars) 48,442,768 — 1,588,189 4,862,248 17,018,412 71,911,617 |
Accumulated other comprehensive
Accumulated other comprehensive loss | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Accumulated other comprehensive loss | Note 23: Accumulated other comprehensive loss Unrealized (losses) HTM investments Unrealized Employee benefit plans December 31, 2018 Pension Post-retirement healthcare Subtotal - employee benefits plans Total AOCL Balance at beginning of year (17,549 ) (839 ) (15,737 ) (61,341 ) (33,586 ) (94,927 ) (129,052 ) Other comprehensive income (loss), net of taxes (2,317 ) 43 (27,893 ) (3,551 ) 14,243 10,692 (19,475 ) Balance at end of year (19,866 ) (796 ) (43,630 ) (64,892 ) (19,343 ) (84,235 ) (148,527 ) Unrealized (losses) HTM investments Unrealized Employee benefit plans December 31, 2017 Pension Post- retirement healthcare Subtotal - employee benefits plans Total AOCL Balance at beginning of year (20,152 ) (979 ) (22,680 ) (63,232 ) (37,637 ) (100,869 ) (144,680 ) Other comprehensive income (loss), net of taxes 2,603 140 6,943 1,891 4,051 5,942 15,628 Balance at end of year (17,549 ) (839 ) (15,737 ) (61,341 ) (33,586 ) (94,927 ) (129,052 ) Unrealized (losses) HTM investments Unrealized Employee benefit plans December 31, 2016 Pension Post- retirement healthcare Subtotal - employee benefits plans Total AOCL Balance at beginning of year (13,645 ) (2,350 ) (57 ) (46,331 ) (28,114 ) (74,445 ) (90,497 ) Transfer of AFS investments to HTM investments — 1,442 (1,442 ) — — — — Other comprehensive income (loss), net of taxes (6,507 ) (71 ) (21,181 ) (16,901 ) (9,523 ) (26,424 ) (54,183 ) Balance at end of year (20,152 ) (979 ) (22,680 ) (63,232 ) (37,637 ) (100,869 ) (144,680 ) Net Change of AOCL Components Year ended Line item in the consolidated statements of operations, if any December 31, 2018 December 31, 2017 December 31, 2016 Net unrealized gains (losses) on translation of net investment in foreign operations adjustments Foreign currency translation adjustments N/A (13,764 ) 12,568 (25,691 ) Gains (loss) on net investment hedge N/A 11,447 (9,965 ) 19,184 Net change (2,317 ) 2,603 (6,507 ) Held-to-maturity investment adjustments Net unamortized gains (losses) transferred from AFS N/A — — 1,442 Amortization of net gains (losses) to net income Interest income on investments 43 140 (71 ) Net change 43 140 1,371 Available-for-sale investment adjustments Gross unrealized gains (losses) N/A (26,793 ) 11,129 (19,635 ) Net unrealized (gains) losses transferred to HTM N/A — — (1,442 ) Transfer of realized (gains) losses to net income Net realized gains (losses) on AFS investments (1,100 ) (4,186 ) (1,546 ) Net change (27,893 ) 6,943 (22,623 ) Employee benefit plans adjustments Defined benefit pension plan Net actuarial gain (loss) N/A (7,541 ) 1,472 (19,956 ) Net loss (gain) on settlement reclassified to net income Net other gains (losses) 1,554 — — Prior service credit (cost) arising during the year N/A (212 ) — — Amortization of net actuarial (gains ) losses Non-service employee benefits expense 2,106 2,247 1,702 Change in deferred taxes N/A (298 ) (595 ) 1,315 Foreign currency translation adjustments of related balances N/A 840 (1,233 ) 38 Net change (3,551 ) 1,891 (16,901 ) Post-retirement healthcare plan Net actuarial gain (loss) N/A 11,589 1,296 (5,911 ) Amortization of net actuarial (gains ) losses Non-service employee benefits expense 2,615 3,514 2,731 Amortization of prior service (credi t) cost Non-service employee benefits expense 39 (759 ) (6,343 ) Net change 14,243 4,051 (9,523 ) Other comprehensive income (loss), net of taxes (19,475 ) 15,628 (54,183 ) |
Capital structure
Capital structure | 12 Months Ended |
Dec. 31, 2018 | |
Banking and Thrift [Abstract] | |
Capital structure | Note 24: Capital structure Authorized Capital On September 16, 2016, the Bank began trading on the New York Stock Exchange under the ticker symbol "NTB". The offering of 12,234,042 common shares consisted of 5,957,447 newly issued common shares sold by Butterfield and 6,276,595 common shares sold by certain selling shareholders, including 1,595,744 common shares sold by certain of the selling shareholders pursuant to the underwriters’ option to purchase additional shares, which was exercised in full prior to the closing. On July 25, 2016, the Bank’s board of directors approved a consolidation of the existing common shares on the basis of a 10 to 1 ratio, subject to shareholder approval. As a result of this consolidation, effective September 6, 2016 upon shareholder approval, every 10 common shares of par value BM $0.01 were consolidated into 1 common share of par value BM $0.10 (the “Share Consolidation”). In addition, as of September 6, 2016, the par value of each issued common share and each authorized but unissued common share was reduced from BM $0.10 to BM $0.01 and the authorized share capital of the Bank was correspondingly reduced from 2,000,000,000 common shares of par value BM $0.10 each, 6,000,000,000 non‑voting ordinary shares of par value BM $0.01 each, 110,200,001 preference shares of par value US $0.01 each and 50,000,000 preference shares of par value £ 0.01 each to 2,000,000,000 common shares of par value BM $0.01 each, 6,000,000,000 non‑voting ordinary shares of par value BM $0.01 each, 110,200,001 preference shares of par value US $0.01 each and 50,000,000 preference shares of par value £ 0.01 each, without any payment by the Bank to the holders of the voting ordinary shares in respect thereof (the “Reduction in Par Value” and together with the Share Consolidation, the “Reverse Share Split”). Immediately following the Reduction in Par Value, the Bank repurchased any and all fractions of common shares issued and outstanding from the holders thereof. All share, share‑based payments and dividend information presented in these consolidated financial statements and accompanying footnotes has been retroactively adjusted to reflect the decreased number of shares resulting from this action. Prior to the Reverse Share Split, the Bank’s total authorized share capital consisted of (i) 20 billion common shares of par value BM $0.01 , (ii) 6 billion non‑voting ordinary shares of par value BM $0.01 ; (iii) 110,200,001 preference shares of par value US $0.01 and (iv) 50 million preference shares of par value £0.01 . Preference Shares On June 22, 2009, the Bank issued 200,000 Government guaranteed, 8.00% non-cumulative perpetual limited voting preference shares (the “preference shares”). The issuance price was US $1,000 per share. The preference share principal and dividend payments were guaranteed by the Government of Bermuda. At any time after the expiry of the guarantee offered by the Government of Bermuda, and subject to the approval of the BMA, the Bank would have been able to redeem, in whole or in part, any preference shares at the time issued and outstanding, at a redemption price equal to the liquidation preference plus any unpaid dividends at the time. Holders of preference shares were entitled to receive, on each preference share only when, as and if declared by the Board of Directors, non-cumulative cash dividends at a rate per annum equal to 8.00% on the liquidation preference of US $1,000 per preference share payable quarterly in arrears. In exchange for the Government's commitment, the Bank issued to the Government a warrant that, upon issuance, allowed the purchase of 427,960 common shares of the Bank at an exercise price of $70.10 per share. The warrant which, after adjustments in accordance with anti-dilution terms allowed for the purchase of 432,028 shares with an exercise price of $34.72 per share was repurchased and canceled by the Bank in December 2016. On December 15, 2016, the Bank effected a mandatory redemption of its preference shares by paying a make-whole redemption payment (the "make-whole redemption price") of USD $1,180.00 per preference share to preference shareholders of record as at December 1, 2016. The make-whole redemption price comprised the sum of the dividend per preference share for the current quarter in which the redemption took place, the $1,000 liquidation preference per preference share, discounted for present value, and the present value of future dividend payments through June 22, 2019. Following the payment of the make-whole redemption price, all issued and outstanding preference shares were redeemed, canceled and reverted to authorized but unissued preference shares of the Bank. The preference shares were also delisted from both the BSX and the Luxembourg Stock Exchange. Dividends Declared During the year ended December 31, 2018 , the Bank paid cash dividends of $1.52 ( December 31, 2017 : $1.28 , December 31, 2016 : $0.40 ) for each common share as of the related record dates. Subsequent to year-end, the Bank declared a fourth interim dividend of $0.44 per common share to be paid to shareholders of record on March 4, 2019 . During the year ended December 31, 2016, the Bank declared the full 8.00% cash dividends on preference shares. As the preference shares were completely redeemed on December 15, 2016, there were nil cash dividends on preference shares for the years ended December 31, 2017 and 2018. The Bank is required to comply with Section 54 of the Companies Act 1981 issued by the Government of Bermuda (the “Companies Act”) each time a dividend is declared or paid by the Bank and also obtain prior written consent from the BMA pursuant to the Banks and Deposit Companies Act 1999 for any dividends declared. The Bank has complied with Section 54 and has obtained BMA consent for all dividends declared during the periods presented. Regulatory Capital Effective January 1, 2016, the Bank’s regulatory capital is determined in accordance with current Basel III guidelines as issued by the BMA. Basel III adopts CET1 as the predominant form of regulatory capital with the CET1 ratio as a new metric. Basel III also adopts the new Leverage Ratio regime, which is calculated by dividing Tier 1 capital by an exposure measure. The Leverage Ratio Exposure Measure consists of total assets (excluding items deducted from Tier 1 capital) and certain off-balance sheet items converted into credit exposure equivalents as well as adjustments for derivatives to reflect credit risk and other risks. Prior to January 1, 2016, the Bank’s regulatory capital was determined in accordance with Basel II guidelines as issued by the BMA. The Bank is fully compliant with all regulatory capital requirements and maintains capital ratios in excess of regulatory minimums as at December 31, 2018 and December 31, 2017 . The following table sets forth the Bank's capital adequacy in accordance with the Basel III framework: December 31, 2018 December 31, 2017 Actual Regulatory minimum Actual Regulatory minimum Capital CET 1 capital 846,043 N/A 772,311 N/A Tier 1 capital 846,043 N/A 772,311 N/A Tier 2 capital 121,521 N/A 74,010 N/A Total capital 967,564 N/A 846,321 N/A Risk Weighted Assets 4,321,354 N/A 4,254,178 N/A Leverage Ratio Exposure Measure 11,139,677 N/A 11,195,173 N/A Capital Ratios (%) CET 1 capital 19.6 % 9.4 % 18.2 % 8.8 % Tier 1 capital 19.6 % 10.9 % 18.2 % 10.3 % Total capital 22.4 % 15.6 % 19.9 % 14.9 % Leverage ratio 7.6 % 5.0 % 6.9 % 5.0 % |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Note 25: Income taxes The Bank is incorporated in Bermuda, and pursuant to Bermuda law is not taxed on either income or capital gains. The Bank’s subsidiaries in the Cayman Islands and The Bahamas are not subject to any taxes in their respective jurisdictions on either income or capital gains under current law applicable in the respective jurisdictions. The Bank’s subsidiaries in Canada, the United Kingdom, Guernsey, Jersey, Switzerland, Singapore and Mauritius are subject to the tax laws of those jurisdictions. For the years ended December 31, 2018 , 2017 , and 2016 , the Bank did not record any unrecognized tax benefits or expenses and has no uncertain tax positions as at December 31, 2018 , 2017 , and 2016 . The Bank records income taxes based on the enacted tax laws and rates applicable in the relevant jurisdictions for the years ended December 31, 2018 , 2017 , and 2016 . For the years ended December 31, 2018 , 2017 , and 2016 , the Bank did not incur any interest or pay any penalties. Year ended Income taxes in consolidated statements of operations December 31, 2018 December 31, 2017 December 31, 2016 Current tax expense 721 856 727 Deferred tax expense 563 231 — Total tax expense 1,284 1,087 727 Reconciliation between the Effective Income Tax Rate and the Statutory Income Tax Rate Year ended December 31, 2018 December 31, 2017 December 31, 2016 $ % $ % $ % Income tax expense in international offices taxed at different rates 876 0.4 % 232 0.2 % (2,104 ) (1.8 )% Change in valuation allowance — — % 597 0.4 % 87 0.1 % Prior year tax adjustments (79 ) — % (55 ) — % (71 ) (0.1 )% Other - net 487 0.2 % 313 0.2 % 2,815 2.4 % Income tax expense (benefit) at effective tax rate 1,284 0.7 % 1,087 0.7 % 727 0.6 % Deferred income taxes December 31, 2018 December 31, 2017 Deferred income tax asset Tax loss carried forward 6,261 6,868 Pension liability 789 1,152 Fixed assets (746 ) (223 ) Allowance for compensated absence 14 15 Deferred income tax asset before valuation allowance 6,318 7,812 Less: valuation allowance (5,955 ) (6,723 ) Net deferred income tax assets 363 1,089 Deferred income tax liability Other (5 ) — Net deferred income tax assets 358 1,089 Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred in the UK segment over the years ended December 31, 2018 and 2017 . Such objective evidence limits the ability to consider other subjective evidence such as projections for future growth. On the basis of this evaluation, as of December 31, 2018 , a valuation allowance of $6.0 million ( December 31, 2017 : $6.7 million ) has been recognized to record only the portion of the deferred tax asset that more likely than not will be realized. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carry-forward period are reduced or increased, or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence such as our projections for growth. This valuation allowance relates specifically to our UK jurisdiction. The Bank has net taxable loss carry forwards related to the Bank’s international operations of approximately $34.4 million ( December 31, 2017 : $33.6 million ), which have an indefinite life. |
Business combinations
Business combinations | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Business combinations | Note 26: Business combinations Bermuda Trust Company Limited and the Private Banking Investment Management of Operations of HSBC Bank Bermuda Limited Acquisition On April 29, 2016, the Bank and two of its subsidiaries, Butterfield Trust (Bermuda) Limited ("BTBL") and Butterfield Asset Management Limited ("BAM"), acquired for a total purchase price of $21.8 million : 1) all outstanding shares of Bermuda Trust Company Limited ("BTCL", a wholly–owned subsidiary of HSBC Bank Bermuda Limited ("HSBCBB")), 2) certain assets of the asset management services operations of HSBCBB and 3) certain assets of the private banking services operations of HSBCBB. The acquisition is in line with the Bank's growth strategy of developing core businesses in existing markets and was undertaken to add scale to the Bank capacity in these market segments where the Bank had already a significant presence and a long history. The acquisition date fair value of consideration transferred amounted to $21.8 million comprising cash settlement of $7.0 million paid on April 29, 2016, a second payment of $2.1 million made on May 6, 2016, and contingent considerations payable in the second half of 2016 and evaluated at $12.7 million . The contingent considerations were dependent on the trust and asset management client retention by Butterfield before the end of the contingency period in September 2016 and the amount paid was $12.7 million . The fair value of the net assets acquired and allocation of purchase is summarized as follows: As at April 29, 2016 Total consideration transferred 21,778 Assets acquired Intangible assets 21,443 Other assets 3,345 Total assets acquired 24,788 Liabilities acquired 3,010 Excess purchase price (goodwill) — The purchase price paid by the Bank was for BTCL's net tangible value as well as intangible assets of $21.4 million in the form of customer relationships in all three segments with an estimated finite useful life of 15 years. The Bank incurred transaction expenses related to this acquisition in the amount of $4.3 million , of which $3.3 million were expensed during the year ended December 31, 2016 (including $0.7 million of legal and professional fees) and $1.0 million were expensed during the year ended December 31, 2015 (including $1.0 million of legal and professional fees). For the year ended December 31, 2016, the amount of revenues and earnings relating to the acquired HSBC Bermuda operations that were not inextricably merged into the Bank’s operations were $9.8 million and $5.0 million respectively. The following selected unaudited pro forma financial information has been provided to present a summary of the combined results of the Bank and the acquired operations from HSBC Bermuda, assuming the transaction had been effected on January 1, 2015. The unaudited pro forma data is for informational purposes only and does not necessarily represent results that would have occurred if the transaction had taken place on the basis assumed above. The pro forma have been prepared based on the actual results realized by the Bank from operating the acquired activities, when such activities were not yet inextricably merged into the Bank's operations. Year ended Unaudited pro forma financial information December 31, 2016 Total net revenue 407,453 Total non-interest operating expense 289,019 Pro forma net income post business combination 118,434 Deutsche Bank’s Global Trust Solutions Acquisition On March 29, 2018, the Bank concluded the acquisition of Deutsche Bank’s Global Trust Solutions (“GTS”) business, excluding its US operations, for net cash payments of $24.7 million (composed of an initial cash payment of $30.2 million followed by a refund of $5.5 million on May 29, 2018). The refund was received based upon the movement in the number of clients in the GTS portfolio between the time the acquisition was agreed upon and the conclusion of the acquisition, together with an adjustment based upon the net asset values of the companies transferred. Butterfield has taken over the ongoing management and administration of the GTS portfolio, comprising approximately 1,000 trust structures for some 900 private clients. Butterfield has also offered positions to all employees who are fully dedicated to GTS in the Cayman Islands, Guernsey, Switzerland, Singapore and Mauritius. The acquisition was undertaken to enhance the Bank's market presence in the global trust service market. The Bank incurred transaction expenses related to this acquisition in the amount of $3.8 million , of which $1.9 million were expensed during the year ended December 31, 2018 (including $1.0 million of legal and professional fees) and $1.9 million were expensed during the year ended December 31, 2017 (including $1.6 million of legal and professional fees). For the year ended December 31, 2018, the amount of revenues and net deficit relating to the acquired GTS operations that were not inextricably merged into the Bank’s operations were $6.5 million and $2.9 million respectively. The assets acquired consist mainly of: customer relationships intangible assets, goodwill and accounts receivable. The liabilities assumed consist mainly of deferred revenues and accounts payable. Goodwill is made up of expected cash flows to be derived from new business and expected synergies resulting from leveraging existing support services and infrastructure within the Bank. The goodwill acquisitions are allocated to reportable segments as per Note 9: Goodwill and other intangible assets. As at March 29, 2018 Total consideration transferred 24,680 Assets acquired Cash due from banks 3,958 Intangible assets (estimated useful life of 15 years) 16,932 Other assets 4,548 Total assets acquired 25,438 Liabilities acquired (included in Other liabilities on the balance sheet) 4,626 Excess purchase price (Goodwill) 3,868 Disclosure of the unaudited pro forma financial information to present a summary of the combined results of the Bank and GTS acquisition is impracticable for the year ended December 31, 2018. The disclosure is impracticable as the Bank does not have access to the complete historical revenue and expense data as it relates to GTS for the period preceding the acquisition. Ongoing Asset Acquisition On February 15, 2018, the Bank announced that it had entered into an agreement to acquire Deutsche Bank's banking and custody business in the Cayman Islands, Guernsey and Jersey. During the year ended December 31, 2018, the Bank began to onboard certain customer deposits relating to the acquisition and this activity is expected to continue in 2019. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related-party transactions | Note 27: Related party transactions Financing Transactions Certain directors and executives of the Bank, companies in which they are principal owners and/or members of the board, and trusts in which they are involved, have loans with the Bank. Loans to directors were made in the ordinary course of business at normal credit terms, including interest rate and collateral requirements. Loans to executives may be eligible to preferential rates. As at December 31, 2018 , related party director and executive loan balances were $97.2 million ( December 31, 2017 : $30.6 million ). During the year ended December 31, 2018 , new issuance of loans to related parties were $77.3 million and repayments and change in directorships were $11.0 million (year ended December 31, 2017 : $31.7 million and $8.9 million , respectively; year ended December 31, 2016 : $27.6 million and $25.1 million , respectively). During the year ended December 31, 2017 , a director resigned from the Board resulting in $4.3 million in loans being reclassified out of related-party loans. All of these loans were considered performing loans as at December 31, 2018 and December 31, 2017 . For the year ended December 31, 2018 , the Bank has recognized $4.5 million ( December 31, 2017 : $1.1 million ; December 31, 2016 : $0.4 million ) of loan interest revenue in the consolidated statement of operations relating to directors and executives, companies in which they are principal owners and/or members of the board and trusts in which they are involved. Certain directors and executives of the Bank, companies in which they are principal owners, and trusts in which they are involved, have deposits with the Bank. As at December 31, 2018 , related party director and executive deposit balances were $17.2 million ( December 31, 2017 : $23.5 million ). Certain affiliates of the Bank have loans and deposits with the Bank. The loans were made and the deposits are maintained in the ordinary course of business on normal commercial terms. At December 31, 2018 , affiliates had loan balances of $10.2 million ( December 31, 2017 : $10.5 million ) and deposit balances of $0.4 million ( December 31, 2017 : $0.6 million ). For the year ended December 31, 2018 , the Bank has recognized $1.8 million ( December 31, 2017 : $1.9 million ; December 31, 2016 : $ 2.2 million ) of non-interest expenses and $0.6 million ( December 31, 2017 : $0.6 million ; December 31, 2016 : $0.6 million ) of loan interest revenue in the consolidated statement of operations relating to affiliates which the Bank holds investments in. Capital Transaction Up to February 28, 2017, investment partnerships associated with The Carlyle Group held approximately 14% of the Bank's equity voting power along with the right to designate two persons for nomination for election by the shareholders as members of the Bank’s Board of Directors. On February 28, 2017, as a result of a secondary public offering, the Carlyle Group sold their holdings in the Bank, and as a result, the investment agreement between the Bank and the Carlyle Group was terminated. Financial Transactions With Related Parties The Bank holds seed investments in several Butterfield mutual funds, which are managed by a wholly-owned subsidiary of the Bank. As at December 31, 2018 , these investments have a fair value of $6.2 million with an unrealized gain of $1.2 million ( December 31, 2017 : $6.6 million and $1.6 million , respectively) and were included in trading investments at their fair value. As at December 31, 2018, several Butterfield mutual funds which are managed by a wholly owned subsidiary of the Bank, had loan balances of $1.8 million (December 31, 2017: nil ) and deposit balances of $36.7 million (December 31, 2017: $0.2 million ). During the year ended December 31, 2018 , the Bank earned $9.4 million ( December 31, 2017 : $7.7 million ; December 31, 2016 : $5.7 million ) in asset management revenue from funds managed by a wholly-owned subsidiary of the Bank. During the year ended December 31, 2018 , the Bank earned $1.4 million ( December 31, 2017 : $1.0 million ; December 31, 2016 : $1.0 million ) in custody and other administration services revenue from funds managed by a wholly-owned subsidiary of the Bank and directors and executives, companies in which they are principal owners and/or members of the board and trusts in which they are involved. During the year ended December 31, 2018, the Bank earned $0.9 million (December 31, 2017: $0.1 million ; December 31, 2016: $0.1 million ) in other income from other related parties. |
Condensed financial statements
Condensed financial statements of the parent company only | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed financial statements of the parent company only | Note 28: Condensed financial statements of the parent company only Condensed financial statements of the Bank of N.T. Butterfield & Son Limited (the ultimate parent company) without consolidation of its subsidiaries were as follows: The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Balance Sheets (In thousands of US dollars) As at December 31, 2018 December 31, 2017 Assets Cash and demand deposits with banks - Non-interest-bearing 21,677 23,774 Demand deposits with banks - Interest-bearing 316,872 192,099 Cash equivalents - Interest-bearing 364,714 389,120 Cash due from banks 703,263 604,993 Securities purchased under agreement to resell 27,341 178,769 Short-term investments 13,736 109,322 Investment in securities Trading 6,495 6,824 Available-for-sale 1,345,408 2,234,979 Held-to-maturity (fair value: $1,076,979 (2017: $695,758)) 1,088,564 697,531 Total investment in securities 2,440,467 2,939,334 Net assets of subsidiaries - Banks 415,227 373,576 Net assets of subsidiaries - Non-banks 24,195 2,543 Loans to third parties, net of allowance for credit losses 1,949,701 1,960,103 Loans to subsidiaries - Banks 12,754 13,517 Loans to subsidiaries - Non-banks 56,020 57,833 Accrued interest 12,824 12,149 Other assets, including premises, equipment and computer software, equity method investments, receivables from subsidiaries and other real estate owned 203,599 203,518 Total assets 5,859,127 6,455,657 Liabilities Customer deposits Non-interest bearing 1,378,539 1,840,201 Interest bearing 3,117,063 3,412,622 Total customer deposits 4,495,602 5,252,823 Bank deposits 154,101 12,252 Total deposits 4,649,703 5,265,075 Employee benefit plans 117,203 127,687 Accrued interest 2,908 1,171 Pending payable for investments purchased — 51,913 Other liabilities, including payables to subsidiaries 63,648 69,930 Total other liabilities 183,759 250,701 Long-term debt 143,322 117,000 Total liabilities 4,976,784 5,632,776 Total shareholders’ equity 882,343 822,881 Total liabilities and shareholders’ equity 5,859,127 6,455,657 The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Statements of Operations (In thousands of US dollars) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Non-interest income Banking 23,506 22,836 21,984 Foreign exchange revenue 11,727 11,623 11,174 Other non-interest income 6,330 4,570 3,516 Dividends from subsidiaries - Banks 60,000 50,000 40,000 Dividends from subsidiaries - Non-banks 19,095 16,060 6,600 Total non-interest income 120,658 105,089 83,274 Interest income Loans 133,124 118,092 123,370 Investments 73,698 61,928 44,745 Deposits with banks 12,932 10,661 6,293 Total interest income 219,754 190,681 174,408 Interest expense Deposits 6,709 5,011 6,882 Long-term debt 6,949 4,955 4,500 Securities sold under repurchase agreements 33 — 118 Total interest expense 13,691 9,966 11,500 Net interest income before provision for credit losses 206,063 180,715 162,908 Provision for credit gains (losses) 6,823 4,618 (7,263 ) Net interest income after provision for credit losses 212,886 185,333 155,645 Net trading gains (losses) (329 ) 511 330 Net realized gains (losses) on available-for-sale investments 758 4,241 1,222 Net gains (losses) on other real estate owned (323 ) (2,416 ) (287 ) Net other gains (losses) — 258 (325 ) Total other gains (losses) 106 2,594 940 Total net revenue 333,650 293,016 239,859 Non-interest expense Salaries and other employee benefits 75,949 72,440 68,712 Technology and communications 36,466 33,051 34,033 Professional and outside services 22,696 20,685 9,379 Property 6,693 6,438 5,983 Indirect taxes 14,669 12,900 10,562 Marketing 3,034 3,384 2,138 Non-service employee benefits expense 6,427 7,854 1,058 Amortization of intangible assets 169 169 113 Restructuring costs — — 117 Other expenses 4,230 4,351 5,373 Total non-interest expense 170,333 161,272 137,468 Net income before equity in undistributed earnings of subsidiaries 163,317 131,744 102,391 Equity in undistributed earnings of subsidiaries 31,867 21,508 13,551 Net income 195,184 153,252 115,942 Other comprehensive income, net of tax (19,475 ) 15,628 (54,183 ) Total comprehensive income 175,709 168,880 61,759 The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Statements of Cash Flows (In thousands of US dollars) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Cash flows from operating activities Net income 195,184 153,252 115,942 Adjustments to reconcile net income to operating cash flows Depreciation and amortization 21,425 23,982 23,687 (Increase) decrease in carrying value of equity method investments (1,033 ) (1,152 ) (949 ) Share-based payments and settlements 12,582 8,410 14,423 Equity in undistributed earnings of subsidiaries (31,867 ) (21,508 ) (13,551 ) Net realized / unrealized (gains) losses on other real estate owned 323 2,416 287 Net realized (gains) losses on available-for-sale investments (758 ) (4,241 ) (1,222 ) Dividends received from equity method investment 376 307 319 Provision for credit losses (6,823 ) (4,618 ) 7,263 Changes in operating assets and liabilities (Increase) decrease in accrued interest receivable (755 ) 2,886 (1,163 ) (Increase) decrease in other assets (11,160 ) 12,167 (20,312 ) Increase (decrease) in accrued interest payable 1,737 (519 ) 160 Increase (decrease) in other liabilities and employee benefit plans (2,523 ) 22,282 10,388 Cash provided by (used in) operating activities 176,708 193,664 135,272 Cash flows from investing activities (Increase) decrease in securities purchased under agreement to resell 151,428 (29,956 ) (148,813 ) Net (increase) decrease in short-term investments other than restricted cash 87,268 342,585 (330,144 ) Net change in trading investments 329 (511 ) (146 ) Available-for-sale investments: proceeds from sale 681,656 205,257 25,489 Available-for-sale investments: proceeds from maturities and pay downs 340,114 324,907 341,835 Available-for-sale investments: purchases (156,271 ) (595,526 ) (1,332,836 ) Held-to-maturity investments: proceeds from maturities and pay downs 82,853 59,424 38,430 Held-to-maturity investments: purchases (525,637 ) (199,145 ) (124,325 ) Net (increase) decrease in loans to third parties 15,184 (46,391 ) 177,823 Net (increase) decrease in loans to bank subsidiaries 764 40,689 10,608 Net (increase) decrease in loans to non-bank subsidiaries 1,812 (2,713 ) 5,172 Additions to premises, equipment and computer software (9,830 ) (14,777 ) (5,700 ) Proceeds from sale of other real estate owned 5,896 1,795 3,061 Injection of capital in subsidiary (64,029 ) (12,802 ) (6,945 ) Return of capital from a subsidiary 8,244 12,376 — Cash disbursed for business acquisition — — (2,540 ) Cash provided by (used in) investing activities 619,781 85,212 (1,349,031 ) The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Statements of Cash Flows (In thousands of US dollars) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Cash flows from financing activities Net (increase) decrease in demand and term deposit liabilities (603,925 ) (811,322 ) 1,696,948 Issuance of subordinated capital 73,218 — — Repayment of long-term debt (47,000 ) — — Proceeds from issuance of common shares, net of underwriting discounts and commissions — 13 131,600 Cost of issuance of common shares — — (5,458 ) Proceeds from loans sold under agreement to repurchase — — 5,152 Cost of repurchase of loans under agreement to repurchase — — (5,152 ) Common shares repurchased (48,443 ) — (1,633 ) Preference shares repurchased — — (212,121 ) Warrant repurchase — — (100 ) Proceeds from stock option exercises 3,318 4,546 6,919 Cash dividends paid on common and contingent value convertible preference shares (83,704 ) (69,731 ) (19,346 ) Cash dividends paid on preference shares — — (14,629 ) Preference shares guarantee fee paid — — (1,676 ) Cash provided by (used in) financing activities (706,536 ) (876,494 ) 1,580,504 Net increase (decrease) in cash, cash equivalent and restricted cash 89,953 (597,618 ) 366,745 Cash, cash equivalent and restricted cash: beginning of year 627,046 1,224,664 857,919 Cash, cash equivalent and restricted cash: end of year 716,999 627,046 1,224,664 Components of cash, cash equivalent and restricted cash at end of year Cash due from banks 703,263 604,993 1,206,770 Restricted cash included in short-term investments on the Consolidated Balance Sheets 13,736 22,053 17,894 Total cash, cash equivalent and restricted cash at end of year 716,999 627,046 1,224,664 Supplemental disclosure of cash flow information Cash interest paid 15,428 9,447 11,660 Non-cash item Transfer to other real estate owned 2,041 — 8,961 |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 29: Subsequent events On February 18, 2019 , the Board of Directors declared a fourth interim dividend of $0.44 per common share to be paid on March 15, 2019 to shareholders of record on March 4, 2019 . |
Significant accounting polici_2
Significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accounting and financial reporting policies of the Bank and its subsidiaries conform to generally accepted accounting principles in the United States of America (“GAAP”). The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the year, and actual results could differ from those estimates. |
Use of Estimates | Critical accounting estimates are those that require management to make subjective or complex judgments about the effect of matters that are inherently uncertain and may change in subsequent periods. Changes that may be required in the underlying assumptions or estimates in these areas could have a material impact on the future financial condition and results of operations. Management believes that the most critical accounting policies upon which the financial condition depends, and which involve the most complex or subjective decisions or assessments, are as follows: • Allowance for credit losses • Fair value and impairment of financial instruments • Impairment of long-lived assets • Impairment of goodwill • Employee benefit plans • Share-based payments |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries (collectively the “Bank”), and those variable interest entities (“VIEs”) where the Company is the primary beneficiary. Intercompany accounts and transactions have been eliminated. VIEs are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity. The Bank is deemed to have a controlling financial interest and is the primary beneficiary of a VIE if it has both the power to direct the activities of the VIE that most significantly impact the VIE economic performance and an obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. The determination of whether the Bank meets the criteria to be considered the primary beneficiary of a VIE requires a periodic evaluation of all transactions (such as investments, loans and fee arrangements) with the entity. The Bank performs on-going reassessments of: (1) whether entities previously evaluated under the majority voting-interest framework have become VIEs, based on certain events, and are therefore subject to the VIE consolidation framework; and (2) whether changes in the facts and circumstances regarding the Bank’s involvement with a VIE cause the Bank’s consolidation conclusion to change. Certain Bank sponsored asset management funds are structured as limited partnerships or limited companies (collectively the “funds”). The funds have various investment strategies (including but not limited to fixed income, equities and fund of funds) and are financed by non-affiliated investors. A subsidiary of the Bank is either the general partner or investment manager to the funds but does not have any significant variable interests in these entities. For those funds where the non-affiliated investors have the ability to remove the subsidiary of the Bank as the general partner or investment manager without cause (i.e. kick out rights), based on a simple majority vote, or the non-affiliated investors have rights to participate in important decisions, the Bank does not consolidate such voting interest entities. In cases where the non-affiliated investors do not have substantive kickout or participating rights, the Bank evaluates the funds as VIEs and consolidates if it is the general partner or investment manager and has a potentially significant interest. During the three years ended December 31, 2018, 2017 and 2016, the Bank had no interests in VIEs where the Bank was considered the primary beneficiary, nor did the Bank have any significant variable interests in a VIE where the Bank was not considered the primary beneficiary. For the variable interests the Bank holds in entities which are not considered VIEs, the Bank utilized the majority voting interest framework. The Bank consolidates these entities where it holds, directly or indirectly, more than 50% of the voting rights or where it exercises control. Entities where the Bank holds 20% to 50% of the voting rights and/or has the ability to exercise significant influence, other than investments in designated VIEs, are accounted for under the equity method, and the pro rata share of their income (loss) is included in other non-interest income. |
Foreign Currency Translation | Foreign Currency Translation Assets, liabilities, revenues and expenses denominated in Bermuda dollars are translated to United States ("US") dollars at par. Assets and liabilities of the parent company arising from other foreign currency transactions are translated into US dollars at the rates of exchange prevailing at the balance sheet date. The resulting gains or losses are included in foreign exchange revenue in the consolidated statements of operations. The assets and liabilities of foreign currency-based subsidiaries are translated at the rate of exchange prevailing on the balance sheet date, while associated revenues and expenses are translated to US dollars at the average rates of exchange prevailing throughout the year. Unrealized translation gains or losses on investments in foreign currency- based subsidiaries are recorded as a separate component of Shareholders' equity within accumulated other comprehensive loss (“AOCL”). Gains and losses on foreign currency-based subsidiaries are recorded in the consolidated statements of operations when the Bank ceases to have a controlling financial interest in a foreign currency-based subsidiary. |
Assets Held in Trust or Custody | Assets Held in Trust or Custody Securities and properties (other than cash and deposits held with the Bank and its subsidiaries) held in trust, custody, agency or fiduciary capacity for customers are not included in the consolidated balance sheets because the Bank is not the beneficiary of these assets. |
Cash Due from Banks | Cash Due from Banks Cash due from banks include cash on hand, cash items in the process of collection, amounts due from correspondent banks and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in fair value. Such investments are those with less than three months’ maturity from the date of acquisition and include unrestricted term deposits, certificates of deposit and treasury bills. Consolidated Statements of Cash Flows For the purposes of the consolidated statements of cash flows, cash due from banks include cash on hand, cash items in the process of collection, amounts due from correspondent banks and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in fair value, and restricted cash included in short-term investments on the consolidated balance sheets. |
Securities Purchased and Sold Under Agreement to Resell | Securities Sold Under Agreements to Repurchase Securities sold under agreements to repurchase (securities financing agreements) are treated as collateralized financing transactions. The obligation to repurchase is recorded at the value of the cash received on sale adjusted for the amortization of the difference between the sale price and the agreed repurchase price. The amortization of this amount is recorded as an interest expense. Collateral The Bank pledges assets as collateral as required for various transactions involving security repurchase agreements, deposit products and derivative financial instruments. Assets that have been pledged as collateral, including those that can be sold or repledged by the secured party, continue to be reported on the Bank’s consolidated balance sheets under the same line items as non-pledged assets of the same type. Securities Purchased Under Agreement to Resell Securities purchased under agreement to resell are treated as collateralized lending transactions. The obligation to resell is recorded at the value of the cash paid on purchase adjusted for the amortization of the difference between the purchase price and the agreed resell price. The amortization of this amount is recorded as interest income. |
Investments | Short-Term Investments Short-term investments have maturities of less than one year from the date of acquisition, are only subject to an insignificant risk of change in fair value and comprise (1) restricted term and demand deposits, and (2) unrestricted term deposits, certificate of deposits and treasury bills with a maturity greater than three months from the date of acquisition. H. Investments Investments securities are classified as trading, available-for-sale (“AFS”) or held-to-maturity (“HTM”). Investments are classified as trading when management has the intent to sell these investments either for profit or to invest the cash received by taking customer deposits in foreign currencies. Debt and equity securities classified as trading investments are carried at fair value in the consolidated balance sheets, with unrealized gains and losses included in the consolidated statements of operations as net realized / unrealized gains (losses) on trading investments. Investments are classified primarily as AFS when used to manage the Bank’s exposure to interest rate and liquidity movements, as well as to make strategic longer-term investments. AFS investments are carried at fair value in the consolidated balance sheets with unrealized gains and losses reported as net increase or decrease to accumulated other comprehensive loss ("AOCL"). Investments that the Bank has the positive intent and ability to hold to maturity are classified as HTM and are carried at amortized cost in the consolidated balance sheets. Unrecognized gains and losses on HTM securities are disclosed in the notes to the consolidated financial statements. The specific identification method is used to determine realized gains and losses on trading and AFS investments, which are included in net realized gains and losses on AFS investments, in the consolidated statements of operations. Dividend and interest income, including amortization of premiums and discounts, on securities for which cash flows are not considered uncertain are included in interest income in the consolidated statements of operations. For securities with uncertain cash flows, the investments are accounted for under the cost recovery method, whereby all principal and coupon payments received are applied as a reduction of the amortized cost and carrying amount. Accrual of income is suspended in respect of debt securities that are in default, or from which it is unlikely that future interest payments will be received as scheduled. Contained within other assets are investments in private equity for which the Bank does not have sufficient rights or ownership interests to follow the equity method of accounting. Unquoted equity investments which are held directly by the Bank and which do not have readily determinable fair values are recorded at cost and reviewed for impairment if indicators of impairment exist. Equity method investments which include investments whereby the Bank has the ability to influence, but not control, the financial or operating policies of such entities, are accounted for using the equity method of accounting. The Bank has reclassified dividends received from affiliates from investing activities to operating activities in the consolidated statements of cash flows. Recognition of other-than-temporary impairments For debt securities, management considers a decline in fair value to be other-than-temporary when it does not expect to recover the entire amortized cost basis of the security. Investments in debt securities in unrealized loss positions are analyzed as part of management’s ongoing assessment of other-than-temporary impairment (“OTTI”). When management intends to sell such securities or it is more likely than not that the Bank will be required to sell the securities before recovering the amortized cost, it recognizes an impairment loss equal to the full difference between the amortized cost basis and the fair value of those securities. When management does not intend to sell or it is more likely than not that the Bank will hold such securities until recovering the amortized cost, management determines whether any credit losses exist to identify any OTTI. Under certain circumstances, management will perform a qualitative determination and consider a variety of factors, including the length of time and extent to which the fair value has been less than cost; adverse conditions specifically related to the industry, geographic area or financial condition of the issuer or underlying collateral of a security; payment structure of the security; changes to the rating of the security by a rating agency; the volatility of the fair value changes; and changes in fair value of the security after the balance sheet date. Alternatively, management estimates cash flows over the remaining lives of the underlying security to assess whether credit losses exist. In situations where there is a credit loss, only the amount of impairment relating to credit losses on AFS and HTM investments is recognized in net income. For AFS investments, the decrease in fair value relating to factors other than credit losses is recognized in AOCL. Cash flow estimates take into account expectations of relevant market and economic data as of the end of the reporting period, including, for example, underlying loan-level data, and structural features of securitization, such as subordination, excess spread, over collateralization or other forms of credit enhancement. The degree of judgment involved in determining the recoverable value of an investment security is dependent upon the availability of observable market prices or observable market parameters. When observable market prices and parameters do not exist, judgment is necessary to estimate recoverable value which gives rise to added uncertainty in the assessment. The assessment takes into consideration factors such as interest rate changes, movements in credit spreads, default rate assumptions, prepayment assumptions, type and quality of collateral, and market sentiment. Management's fair valuations may include inputs and assumptions that are less observable or require greater estimation, thereby resulting in values which may be greater or lower than the actual value at which the investments may be ultimately sold or the ultimate cash flows that may be recovered. If the assumptions on which management based its fair valuations change, the Bank may experience additional OTTI or realized losses or gains, and the period-to-period changes in value could vary significantly. |
Loans | Loans Loans are reported as the principal amount outstanding, net of allowance for credit losses, unearned income, fair value adjustments arising from hedge accounting and net deferred loan fees. Interest income is recognized over the term of the loan using the effective interest method, or on a basis approximating a level rate of return over the term of the loan, except for loans classified as non-accrual. Prepayments are treated as a reduction of principal outstanding which is recognized upon receipt of payment. Prepayment penalties, if applicable under the terms of the specific loan agreement, are recognized also upon receipt of payment. Acquired loans Acquired loans are recorded at fair value at the date of acquisition. No allowance for credit losses is recorded on the acquisition date as the fair value of the acquired assets incorporates assumptions regarding credit risk. Acquired loans with evidence of credit quality deterioration for which it is probable that the Bank will not receive all contractually required payments receivable are accounted for as purchased credit-impaired loans. Generally, acquired loans that meet the Bank's definition for non-accrual status are considered to be credit-impaired. The excess of the cash flows expected to be collected on purchased credit-impaired loans, measured as of the acquisition date, over the estimated fair value is referred to as the accretable yield and is recognized in interest income over the remaining life of the loan using an effective yield methodology. The difference between contractually required payments as of the acquisition date and the cash flows expected to be collected is referred to as the non-accretable difference which is included as a reduction of the carrying amount of the purchased credit-impaired loans. The Bank evaluates at each balance sheet date the estimated cash flows and corresponding carrying value of purchased credit-impaired loans in the same manner as for the measurement of impaired loans, as is described below. The Bank evaluates at each balance sheet date whether the carrying value of its purchased credit-impaired loans has decreased and if so, recognizes an allowance for credit losses in its consolidated statements of operations. For any increases in cash flows expected to be collected, the Bank adjusts any prior recorded allowance for purchased credit-impaired loans first, and then the amount of accretable yield recognized on a prospective basis over the purchased credit-impaired loan’s remaining life. Purchased credit-impaired loans are not considered non-performing and continue to have an accretable yield as long as there is a reasonable expectation about the timing and amount of cash flows expected to be collected. Impaired loans A loan is considered to be impaired when, based on current information and events, the Bank determines that it will not be able to collect all amounts due according to the original loan contract, including scheduled interest payments. Impaired loans include all non-accruing loans and all loans modified in a troubled debt restructuring (‘‘TDR’’) even if full collectability is expected following the restructuring. When a loan is identified as impaired, the impairment is measured based on the present value of expected future cash flows, discounted at the loan’s effective interest rate, except when the sole (remaining) source of repayment for the loan is the operation or liquidation of the collateral. In these cases the current fair value of the collateral, less selling costs, is used instead of discounted cash flows. If the Bank determines that the expected realizable value of the impaired loan is less than the recorded investment in the loan (net of previous charge-offs, deferred loan fees or costs and unamortized premium or discount), impairment is recognized through an allowance estimate. If the Bank determines that part of the allowance is uncollectible, that amount is charged off. Non-accrual Commercial, commercial real estate and consumer loans (excluding credit card consumer loans) are placed on non-accrual status generally if: • in the opinion of management, full payment of principal or interest is in doubt; or • principal or interest is 90 days past due. Residential mortgages are placed on non-accrual status immediately if: • in the opinion of management, full payment of principal or interest is in doubt; or • when principal or interest is 90 days past due, unless the loan is well secured and any ongoing collection efforts are reasonably expected to result in repayment of all amounts due under the contractual terms of the loan. Interest income on non-accrual loans is recognized only to the extent it is received in cash. Cash received on non-accrual loans where there is no doubt regarding full repayment (no impairment recognized in the form of a specific allowance) is first applied as repayment of the past due principal amount of the loan and secondly to past due interest and fees. Where there is doubt regarding the ultimate full repayment of the non-accrual loan (impairment recognized in the form of a specific allowance), all cash received is applied to reduce the principal amount of the loan. Interest income on these loans is recognized only after the entire balance receivable is recovered and interest is actually received. Loans are returned to accrual status when: • none of the principal or accrued interest is past due (with certain exceptions as noted below) and the Bank expects repayment of the remaining contractual obligation; or • when the loan becomes well secured and in the process of collection. Loans modified in a troubled debt restructuring ("TDR") A modification of a loan constitutes a TDR when a borrower is experiencing financial difficulty and the modification constitutes a concession from originally agreed terms. If a restructuring is considered a TDR, the Bank is required to make certain disclosures in the notes of the consolidated financial statements and individually evaluate the restructured loan for impairment. The Bank employs various types of concessions when modifying a loan that it would not otherwise consider which may include extension of repayment periods, interest rate reductions, principal or interest forgiveness, forbearance, and other actions intended to minimize economic loss and to avoid foreclosure or repossession of collateral. Commercial and industrial loans modified in a TDR often involve temporary interest-only payments, term extensions, and converting revolving credit lines to term loans. Additional collateral, a co-borrower, or a guarantor is often requested. Commercial mortgage and construction loans modified in a TDR often involve extending the maturity date at an interest rate lower than the current market rate for new debt with similar risk, or substituting or adding a new borrower or guarantor. Construction loans modified in a TDR may also involve extending the interest-only payment period. Residential mortgage modifications generally involve a short-term forbearance period after which the missed payments are added to the end of the loan term, thereby extending the maturity date. Interest continues to accrue on the missed payments and as a result, the effective yield on the mortgage remains unchanged. As the forbearance period usually involves an insignificant payment delay they typically do not meet the reporting criteria for a TDR. Automobile loans modified in a TDR are primarily composed of loans where the Bank has lowered monthly payments by extending the term. When a loan undergoes a TDR, the determination of the loan's accrual versus non-accrual status following the modification depends on several factors. As with the risk rating process, the accrual status decision for such a loan is a separate and distinct process from the loan's TDR analysis and determination. Management considers the following in determining the accrual status of restructured loans: • If the loan was appropriately on accrual status prior to the restructuring, the borrower has demonstrated performance under the previous terms, and the Bank's credit evaluation shows the borrower's capacity to continue to perform under the restructured terms (both principal and interest payments), it is likely that the appropriate conclusion is for the loan to remain on accrual at the time of the restructuring. This evaluation must include consideration of the borrower's sustained historical repayment performance for a reasonable period prior to the date on which the loan was restructured. A sustained period of repayment performance generally would be a minimum of six months and would involve payments of cash or cash equivalents; or • If the loan was on non-accrual status before the restructuring, but the Bank's credit evaluation shows the borrower's capacity to meet the restructured terms, the loan would likely remain as non-accrual until the borrower has demonstrated a reasonable period of sustained repayment performance. As noted above, this period generally would be at least six months (thereby providing reasonable assurance as to the ultimate collection of principal and interest in full under the modified terms). Sustained performance before the restructuring may be taken into account. Loans that have been modified in a TDR are restored to accrual status only when interest and principal payments are brought current for a continuous period of six months under the modified terms. However, performance prior to the modification, or significant events that coincide with the modification, are included in assessing whether the borrower can meet the new terms and may result in the loan being returned to accrual status at the time of loan modification or after a shorter performance period. If the borrower’s ability to meet the revised payment schedule is uncertain, the loan remains on non-accrual status. A loan that is modified in a TDR prior to becoming impaired will be left on accrual status if full collectability in accordance with the restructured terms is expected. The Bank works with its customers in these difficult economic times and may enter into a TDR for loans that are in default, or at risk of defaulting, even if the loan is not impaired. A loan that had previously been modified in a TDR and is subsequently refinanced under current underwriting standards at a market rate with no concessionary terms is accounted for as a new loan and is no longer reported as a TDR. Delinquencies The entire balance of an account is contractually delinquent if the minimum payment of principal or interest is not received by the specified due date. Delinquency is reported on loans that are more than 30 days past due. Charge-offs The Bank recognizes charge-offs when it determines that loans are uncollectible, and this generally occurs when all commercially reasonable means of recovering the loan balance have been exhausted. Commercial and consumer loans are either fully or partially charged-off down to the fair value of collateral securing the loans when: • management judges the loan to be uncollectible; • repayment is expected to be protracted beyond reasonable time frames; • the asset has been classified as a loss by either the Bank’s internal loan review process or third party appraisers; or • the customer has filed bankruptcy and the loss becomes evident owing to a lack of assets or cash flow. The outstanding balance of commercial and consumer real estate secured loans and residential mortgages that are in excess of the estimated property value, less costs to sell, is charged-off once there is reasonable assurance that such excess outstanding balance is not recoverable. Credit card consumer loans that are contractually 180 days past due and other consumer loans with an outstanding balance under $100,000 that are contractually 180 days past due are generally written off and reported as charge-offs. |
Allowance for Credit Losses | Allowance for Credit Losses The Bank maintains an allowance for credit losses, which in management’s opinion is adequate to absorb all estimated credit-related losses that are incurred in its lending and off-balance sheet credit-related arrangements at the balance sheet date. The allowance for credit losses consists of specific allowances and a general allowance as follows: Specific allowances Specific allowances are determined on an exposure-by-exposure basis and reflect the associated estimated credit loss. The specific allowance for credit loss is computed as the difference between the recorded investment in the loan and the present value of expected future cash flows from the loan. The effective rate of return on the loan is used for discounting the cash flows. However, when foreclosure of a collateral-dependent loan is probable, the Bank measures impairment based on the fair value of the collateral. The Bank considers estimated costs to sell, on a discounted basis, in the measurement of impairment if those costs are expected to reduce the cash flows available to repay or otherwise satisfy the loan. If the measurement of an impaired loan is less than the recorded investment in the loan, then the Bank recognizes impairment by creating an allowance with a corresponding charge to provision for credit losses. For all commercial and commercial real estate TDRs, the Bank conducts further analysis to determine the probable amount of loss and establishes a specific allowance for the loan, if appropriate. The Bank estimates the impairment amount by comparing the loan’s carrying amount to the estimated present value of its future cash flows or the fair value of its underlying collateral. For collateral-dependent impaired commercial and commercial real estate loans, the excess of the Company’s recorded investment in the loan over the fair value of the collateral, less cost to sell, is charged off to the specific allowance. For consumer and residential mortgage TDRs that are not collateral-dependent, allowances are developed using the present value of expected future cash flows, compared to the recorded investment in the loans. Expected re-default factors are considered in this analysis. The fair value of collateral is periodically monitored subsequent to the modification. General allowances The allowance for credit losses attributed to the remaining portfolio is established through various analyzes that estimate the incurred loss at the balance sheet date inherent in the lending and off-balance sheet credit-related arrangements portfolios. These analyzes may consider historical default rates, geographic, industry, and other environmental factors. Management may also consider overall portfolio indicators including trends in internally risk rated exposures, cash-basis loans, historical and forecasted write-offs, and a review of industry, geographic and portfolio concentrations, including current developments within those segments. In addition, management may consider the current business strategy and credit process, including limit setting and compliance, credit approvals, loan underwriting criteria and loan workout procedures. Each portfolio of smaller balance, homogeneous loans, including consumer installment, revolving credit, and most other consumer loans, is collectively evaluated for impairment. The allowance for credit losses attributed to these loans is established via a process that estimates the probable losses inherent and incurred in the portfolio, based upon various analyzes. Management may consider overall portfolio indicators including historical credit losses; delinquent (defined as loans that are more than 30 days past due), non-performing, and classified loans; trends in volumes and terms of loans; an evaluation of overall credit quality; the credit process, including lending policies and procedures; and economic, geographical, product, and other environmental factors. |
Business Combinations | All business combinations are accounted for using the acquisition method. |
Goodwill and Intangible Assets | Identifiable intangible assets (mostly customer relationships) are recognized separately from goodwill and are initially valued at fair value using discounted cash flow calculations and other recognized valuation techniques. Goodwill represents the excess of the fair value of the consideration paid for the acquisition of a business over the fair value of the net assets acquired. Contingent purchase consideration is measured at its fair value and recorded on the purchase date. Any subsequent changes in the fair value of a contingent consideration liability will be recorded through the consolidated statements of operations. Goodwill is tested annually for impairment at the reporting unit level, or more frequently if events or circumstances indicate there may be impairment. If the carrying amount of a reporting unit, including the allocated goodwill, exceeds its fair value, goodwill impairment is measured as the excess of the carrying amount of the reporting unit's allocated goodwill over the implied fair value of the goodwill. Other acquired intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives, not exceeding 15 years. Intangible assets' estimated lives are re-evaluated annually and an impairment test is carried out if certain indicators of impairment exist. |
Premises, Equipment and Computer Software | Premises, Equipment and Computer Software Land is carried at cost. Buildings, equipment and computer software, including leasehold improvements, are carried at cost less accumulated depreciation. The Bank generally computes depreciation using the straight-line method over the estimated useful life of an asset, which is 50 years for buildings, and three to 10 years for other equipment. For leasehold improvements the Bank uses the straight-line method over the lesser of the remaining term of the leased facility or the estimated economic life of the improvement. The Bank capitalizes certain costs, including interest cost incurred during the development phase, associated with the acquisition or development of internal use software. Once the software is ready for its intended use, these costs are amortized on a straight-line basis over the software's expected useful life, which is between five and 10 years. Management reviews the recoverability of the carrying amount of premises, equipment and computer software when indicators of impairment exist and an impairment charge is recorded when the carrying amount of the reviewed asset is deemed not recoverable by future expected cash flows to be derived from the use and disposition of the asset. If there is a disposition out of premises, equipment and computer software, a gain is recorded if the difference of the proceeds on disposition is in excess of the assets carrying value. Otherwise, a loss is recorded. If there is an abandonment out of premises, equipment and computer software, the full carrying value of the asset is recognized as a loss. |
Other Real Estate Owned | Other Real Estate Owned Other real estate owned (“OREO”) comprises real estate property held for sale and commercial and residential real estate properties acquired in partial or total satisfaction of loans acquired through foreclosure proceedings, acceptance of a deed-in-lieu of foreclosure or by taking possession of assets that were used as loan collateral. These properties are initially recorded at fair value less estimated costs to sell the property. If the recorded investment in the loan exceeds the property’s fair value at the time of acquisition, a charge-off is recorded against the specific allowance. If the carrying value of the real estate exceeds the property’s fair value at the time of reclassification, an impairment charge is recorded in the consolidated statements of operations. Subsequent decreases in the property’s fair value below the new cost basis are recorded through the use of a valuation allowance. Subsequent increases in the fair value of a property may be used to reduce the allowance but not below zero. Any operating expenses of the property are recognized through charges to non-interest expense. |
Derivatives | Derivatives All derivatives are recognized on the consolidated balance sheets at their fair value. On the date that the Bank enters into a derivative contract, it designates the derivative as either: a hedge of the fair value of a recognized asset or liability (a fair value hedge); a hedge of a forecasted transaction or the variability of cash flows that are to be received or paid in connection with a recognized asset or liability (a cash flow hedge); a hedge of an exposure to foreign currency risk of a net investment in a foreign operation (a net investment hedge); or, an instrument that is held for trading or non-hedging purposes (a trading or non-hedging derivative instrument). All instruments utilized as a hedging instrument in a fair value hedge or cash flow hedge must have one or more underlying notional amounts, no or a minimal net initial investment and a provision for net settlement in the contract to meet the definition of a derivative instrument. Instruments utilized as a hedging instrument in a hedge of a net investment in foreign operations may be derivative instruments or non-derivatives. The changes in the fair value of a derivative that is designated and qualifies as a fair value hedge, along with changes in the fair value of the hedged asset or liability that are attributable to the hedged risk, are recorded in current year earnings. The changes in the fair value of a derivative that is designated and qualifies as a cash flow hedge, to the extent that the hedge is effective, are recorded in other comprehensive loss ("OCL") and the ineffective portion is recorded in current year earnings. That is, ineffectiveness from a derivative that overcompensates for changes in the hedged cash flows is recorded in earnings. However, the ineffectiveness from a derivative that under compensates is not recorded in earnings. The changes in the fair value of a derivative that is designated and qualifies as a foreign currency hedge is recorded in either current year earnings or OCL, depending on whether the hedging relationship satisfies the criteria for a fair value or cash flow hedge. If, however, a derivative is used as a hedge of a net investment in a foreign operation, the changes in the derivative’s fair value, to the extent that the derivative is effective as a hedge, are recorded in the cumulative translation adjustment (“CTA”) account within OCL. Changes in the fair value of trading and non-hedging derivative instruments are reported in current year earnings. The Bank formally documents all relationships between hedging instruments and hedged items, as well as its risk management objectives and strategies for undertaking various hedge transactions. This process includes linking all derivatives that are designated as fair value, cash flow, or foreign currency hedges to specific assets and liabilities on the consolidated balance sheets or specific firm commitments or forecasted transactions. The Bank also formally assesses whether the derivatives that are used in hedging transactions have been highly effective in offsetting changes in the fair value or cash flows of hedged items and whether those derivatives may be expected to remain highly effective in future periods. For those hedge relationships that are terminated, hedge designations that are elected to be removed, forecasted transactions that are no longer expected to occur, or the hedge relationship ceases to be highly effective, the hedge accounting treatment described in the paragraphs above is no longer applied and the end-user derivative is terminated or transferred to the trading designation. For fair value hedges, any changes to the carrying value of the hedged item prior to the discontinuance remain as part of the basis of the asset or liability. When a cash flow hedge is discontinued, the net derivative gain (loss) remains in AOCL unless it is probable that the forecasted transaction will not occur in the originally specified time period. |
Employee Benefit Plans | Employee Benefit Plans The Bank maintains trusteed pension plans for substantially all employees as either non-contributory defined benefit plans or defined contribution plans. Benefits under the defined benefit plans are based primarily on the employee's years of credited service and average annual salary during the final years of employment as defined in the plans. The Bank also provides post-retirement medical benefits for certain qualifying active and retired Bermuda-based employees. Expense for the defined benefit pension plans and the post-retirement medical benefits plan is composed of (a) the actuarially determined benefits for the current year's service, (b) imputed interest on the actuarially determined liability of the plan, (c) in the case of the defined benefit pension plans, the expected investment return on the fair value of plan assets and (d) amortization of certain items over the expected average remaining service life of employees in the case of the active defined benefit pension plans, estimated average remaining life expectancy of the inactive participants in the case of the inactive defined benefit pension plans and the expected average remaining service life to full eligibility age of employees covered by the plan in the case of the post-retirement medical benefits plan. The items amortized are amounts arising as a result of experience gains and losses, changes in assumptions, plan amendments and the change in the net pension asset or post-retirement medical benefits liability arising on adoption of revised accounting standards. For each of the defined benefit pension plans and for the post-retirement medical benefits plan, the assets and liabilities recognized for accounting purposes are reported in other assets and employee benefit plans respectively. The actuarial gains and losses, transition obligation and prior service costs of the defined pension plans and post-retirement medical benefits plan are recognized in OCL net of tax and amortized to net income over the average service period for the active defined benefit pension plans and post-retirement medical benefits plan and average remaining life expectancy for the inactive defined benefit pension plans. For the defined contribution pension plans, the Bank and participating employees provide an annual contribution based on each participating employee's pensionable earnings. Amounts paid are expensed in the period. |
Share-based Compensation | Share-Based Compensation The Bank engages in equity settled share-based payment transactions in respect of services received from eligible employees. The fair value of the services received is measured by reference to the fair value of the shares or share options granted on the date of the grant. The cost of the employee services received in respect of the shares or share options granted is recognized in the consolidated statements of operations over the shorter of the vesting or service period. The fair value of the options granted is determined using option pricing models, which take into account the exercise price of the option, the current share price, the risk-free interest rate, expected dividend rate, the expected volatility of the share price over the life of the option and other relevant factors. The fair value of unvested share awards is deemed to be the closing price of the publicly traded Bank shares on grant date. The fair value of time vesting conditions are taken into account by adjusting the number of shares or share options included in the measurement of the cost of employee services so that ultimately, the amount recognized in the consolidated statements of operations reflects the number of vested shares or share options. The Bank recognizes compensation cost for awards with performance conditions if and when the Bank concludes that it is probable that the performance condition will be achieved, net of an estimate of pre-vesting forfeitures (e.g., due to termination of employment prior to vesting). |
Revenue Recognition | Revenue Recognition Trust, custody and other administration services fees include fees for private and institutional trust, executorship, and custody services. Asset management fees include fees for investment management, investment advice and brokerage services. Fees are recognized as revenue over the period of the relationship or when the Bank has rendered all services to the clients and is entitled to collect the fee from the client, as long as there are no contingencies associated with the fees. Banking services fees primarily include fees for letters of credit and other financial guarantees, compensating balances, overdraft facilities and other financial services-related products as well as credit card fees. Letters of credit and other financial guarantees fees are recognized as revenue over the period in which the related guarantee is outstanding. Credit card fees are comprised of merchant discounts, late fees and membership fees, net of interchange and rewards costs. Credit card fees are recognized in the period in which the service is provided. All other fees are recognized as revenue in the period in which the service is provided. Foreign exchange revenue includes fees earned on currency exchange transactions which are recognized when such transactions occur, as well as gains and losses recognized when translating financial instruments held or due in currencies other than the local functional currency at the rates of exchange prevailing at the balance sheet date. Loan interest income includes the amortization of deferred non-refundable loan origination and commitment fees. These fees are recognized as an adjustment of yield over the life of the related loan. Loan origination and commitment fees are offset by their related direct costs and only the net amounts are deferred and amortized into interest income. Dividend and interest income, including amortization of premiums and discounts, on securities for which cash flows are not considered uncertain are included in interest income in the consolidated statements of operations. Loans placed on non-accrual status and investments with uncertain cash flows are accounted for under the cost recovery method, whereby all principal, dividends, interest and coupon payments received are applied as a reduction of the amortized cost and carrying amount. |
Fair Values | Fair Values Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Bank determines the fair values of assets and liabilities based on the fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The relevant accounting standard describes three levels of inputs that may be used to measure fair value. Investments classified as trading and AFS, and derivative assets and liabilities are recognized in the consolidated balance sheets at fair value. Level 1, 2 and 3 valuation inputs Management classifies items that are recognized at fair value on a recurring basis based on the level of inputs used in their respective fair value determination as described below. Fair value inputs are considered Level 1 when based on unadjusted quoted prices in active markets for identical assets. Fair value inputs are considered Level 2 when based on inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active. Fair value inputs are considered Level 3 when based on internally developed models using significant unobservable assumptions involving management's estimations or non-binding bid quotes from brokers. The following methods and assumptions were used in the determination of the fair value of financial instruments: Cash due from banks The carrying amount of cash and demand deposits with banks, being short-term in nature, is deemed to approximate fair value. Cash equivalents include unrestricted term deposits, certificates of deposits and Treasury bills with a maturity of less than three months from the date of acquisition and the carrying value at cost is considered to approximate fair value because they are short term in nature, bear interest rates that approximate market rates, and generally have negligible credit risk. Short-term investments Short-term investments comprise restricted term and demand deposits and unrestricted term deposits, certificates of deposit and treasury bills with less than one year but greater than three months' maturity from the date of acquisition. The carrying value at cost is considered to approximate fair value because they are short term in nature, bear interest rates that approximate market rates, and generally have negligible credit risk. Trading investments and defined benefit pension plan equity securities and mutual funds These include equities and mutual funds. The fair value of listed equity securities is based upon quoted market values. Investments in actively traded mutual funds are based on their published net asset values. See “AFS and HTM investments and defined benefit pension plan fixed income securities” below for valuation techniques and inputs of fixed income securities. AFS and HTM investments and defined benefit pension plan fixed income securities The fair values for AFS investments are generally sourced from third parties. The fair value of fixed income securities is based upon quoted market values where available, “evaluated bid” prices provided by third party pricing services (“pricing services”) where quoted market values are not available, or by reference to broker or underwriter bid indications where pricing services do not provide coverage for a particular security. To the extent the Bank believes current trading conditions represent distressed transactions, the Bank may elect to utilize internally generated models. The pricing services typically use market approaches for valuations using primarily Level 2 inputs (in the vast majority of valuations), or some form of discounted cash flow analysis. Pricing services indicate that they will only produce an estimate of fair value if there is objectively verifiable information available to produce a valuation. Standard inputs to the valuations provided by the pricing services listed in approximate order of priority for use when available include: reported trades, benchmark yields, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data. The pricing services may prioritize inputs differently on any given day for any security, and not all inputs listed are available for use in the evaluation process on any given day for each security evaluation. However, the pricing services also monitor market indicators and industry and economic events. When these inputs are not available, pricing services identify “buckets” of similar securities (allocated by asset class types, sectors, sub-sectors, contractual cash flows/structure, and credit rating characteristics) and apply some form of matrix or other modeled pricing to determine an appropriate security value which represents their best estimate as to what a buyer in the marketplace would pay for a security in a current sale. It is common industry practice to utilize pricing services as a source for determining the fair values of investments where the pricing services are able to obtain sufficient market corroborating information to allow them to produce a valuation at a reporting date. In addition, in the majority of cases, although a value may be obtained from a particular pricing service for a security or class of similar securities, these values are corroborated against values provided by other pricing services. While the Bank receives values for the majority of the investment securities it holds from pricing services, it is ultimately management’s responsibility to determine whether the values received and recorded in the financial statements are representative of appropriate fair value measurements. Broker/dealer quotations are used to value investments with fixed maturities where prices are unavailable from pricing services due to factors specific to the security such as limited liquidity, lack of current transactions, or trades only taking place in privately negotiated transactions. These are considered Level 3 valuations, as significant inputs utilized by brokers may be difficult to corroborate with observable market data, or sufficient information regarding the specific inputs utilized by the broker was not available to support a Level 2 classification. For disclosure purposes, held-to-maturity investments are fair valued using the same methods described above. Loans The majority of loans are variable rate and re-price in response to changes in market rates and hence management estimates that the fair value of loans is not significantly different than their carrying amount. For significant fixed-rate loan exposures, fair value is estimated by discounting the future cash flows, using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities, of such loans. Management includes the effects of specific provisions raised against individual loans, which factors in a loan's credit quality, as well as accrued interest in determining the fair value of loans. Accrued interest The carrying amounts of accrued interest receivable and payable are assumed to approximate their fair values given their short-term nature. OREO OREO assets are carried at the lower of cost or fair value less estimated costs to sell. The determination of fair value, which aims at estimating the realizable value of the properties, is based either on third-party appraisals, when available, or on internal valuation models. Appraisals of OREO properties are updated on an annual basis. Where the fair value of the related property is based on an unadjusted appraised value, the OREO is generally classified as Level 2. Where significant adjustments are made to the appraised value, or based on an internally generated valuation model, the OREO is generally classified as Level 3. Deposits The fair value of fixed-rate deposits has been estimated by discounting the contractual cash flows, using market interest rates offered at the balance sheet date for deposits of similar terms. The carrying amount of deposits with no stated maturity date is deemed to equate to the fair value. Long-term debt The fair value of the long-term debt has been estimated by discounting the contractual cash flows, using current market interest rates. Derivatives Derivative contracts can be exchange traded or over-the-counter (“OTC”) derivative contracts and may include forward, swap and option contracts relating to interest rates or foreign currencies. Exchange-traded derivatives typically fall within Level 1 of the fair value hierarchy depending on whether they are deemed to be actively traded or not. OTC derivatives are valued using market transactions and other market evidence whenever possible, including market-based inputs to models, model calibration to market clearing transactions, broker or dealer quotations or alternative pricing sources where an understanding of the inputs utilized in arriving at the valuations is obtained. Where models are used, the selection of a particular model to value an OTC derivative depends upon the contractual terms and specific risks inherent in the instrument as well as the availability of pricing information in the market. The Bank generally uses similar models to value similar instruments. Valuation models require a variety of inputs, including contractual terms, market prices, yield curves, credit curves, measures of volatility, prepayment rates and correlations of such inputs. For OTC derivatives that trade in liquid markets, such as generic forwards, interest rate swaps and options, model inputs can generally be verified and model selection does not involve significant management judgment. Goodwill The fair value of reporting units for which goodwill is recognized is determined when an impairment assessment is performed by discounting estimated future cash flows using discount rates reflecting valuation-date market conditions and risks specific to the reporting unit. |
Impairment or Disposal of Long-Lived Assets | Impairment or Disposal of Long-Lived Assets Impairment losses are recognized when the carrying amount of a long-lived asset exceeds the sum of the undiscounted cash flows expected from its use and disposal. The impairment recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. Long-lived assets that are to be disposed of other than by sale are classified and accounted for as held for use until the date of disposal or abandonment. Assets that meet certain criteria are classified as held for sale and are measured at the lower of their carrying amounts or fair value less estimated costs to sell. |
Credit-Related Arrangements | Credit-Related Arrangements In the normal course of business, the Bank enters into various commitments to meet the credit requirements of its customers. Such commitments, which are not included in the consolidated balance sheet, include: • commitments to extend credit, which represent undertakings to make credit available in the form of loans or other financing for specific amounts and maturities, subject to certain conditions; • standby letters of credit, which represent irrevocable obligations to make payments to third parties in the event that the customer is unable to meet its financial obligations; and, • documentary and commercial letters of credit, related primarily to the import of goods by customers, which represent agreements to honor drafts presented by third parties upon completion of specific activities. These credit arrangements are subject to the Bank's normal credit standards and collateral is obtained where appropriate. The contractual amounts for these commitments set out in the table in Note 12 represent the maximum payments the Bank would have to make should the contracts be fully drawn, the counterparty default, and any collateral held prove to be of no value. As many of these arrangements will expire or terminate without being drawn upon or are fully collateralized, the contractual amounts do not necessarily represent future cash requirements. The Bank does not carry any liability for these obligations. |
Income Taxes | Income Taxes The Bank uses the asset and liability method of accounting for income taxes. Under this method, deferred income taxes reflect the net tax effect of temporary differences between the consolidated financial statements' carrying amounts of assets and liabilities and their respective tax bases. Accordingly, a deferred income tax asset or liability is determined for each temporary difference based on the enacted tax rates to be in effect on the expected reversal date of the temporary difference. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Bank records net deferred tax assets to the extent the Bank believes these assets will more likely than not be realized. Net deferred income tax assets or liabilities accumulated as a result of temporary differences are included in other assets or other liabilities, respectively. A valuation allowance is established to reduce deferred income tax assets to the amount more likely than not to be realized. In making such a determination, the Bank considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. In the event the Bank were to determine that it would be able to realize the deferred income tax assets in the future in excess of their net recorded amount, the Bank would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Bank records uncertain tax positions on the basis of a two-step process whereby (1) the Bank determines whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) where those tax positions that meet the more-likely-than-not recognition threshold, the Bank recognizes the largest amount of tax benefit that is greater than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Income taxes on the consolidated statements of operations include the current and deferred portions of the income taxes. The Bank recognizes accrued interest and penalties related to income taxes in operating expenses. Income taxes applicable to items charged or credited directly to shareholders’ equity are included in such items. |
Earnings Per Share | Earnings Per Share Earnings per share have been calculated using the weighted average number of common shares outstanding during the year (see also Note 20). Dividends declared on preference shares and related guarantee fees are deducted from net income to obtain net income available to common shareholders. In periods when basic earnings per share is positive, the dilutive effect of share-based compensation plans is calculated using the treasury stock method, whereby the proceeds received from the exercise of share-based awards are assumed to be used to repurchase outstanding common shares, using the quarterly average market price of the Bank’s shares for the period. |
New Accounting Pronouncements | New Accounting Pronouncements The following accounting developments were issued during the year ended December 31, 2018 or are accounting standards pending adoption: In February 2016, the FASB published Accounting Standards Update No. 2016-02 Leases (Topic 842) which requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous GAAP. This update is effective for public business entities for fiscal years, and interim periods with in those fiscal years, beginning after December 15, 2018. Early application is permitted. The Bank has determined that this standard will have an effect due to the recognition of lease assets and lease liabilities currently classified as operating leases, which will result in the recognition of assets and corresponding lease liabilities. In July 2018, the FASB published Accounting Standards Update No. 2018-11 Codification Improvements to Topic 842, Leases Targeted Improvements. The first amendment in this update provides entities with an additional (and optional) transition method to initially apply the new leases standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. An entity's reporting for the comparative periods presented in the financial statements in which it adopts the new leases standard will continue to be in accordance with current GAAP (Topic 840, Leases). The second amendment in this update provides lessors with a practical expedient, by class of underlying asset, to not separate non-lease components from the associated lease component and, instead, to account for those components as a single component if the non-lease components otherwise would be accounted for under the new revenue guidance (Topic 606) and if required conditions are met. For entities that have not adopted Topic 842 before the issuance of this update, the effective date and transition requirements for the amendments in this update related to separating components of a contract are the same as the effective date and transition requirements in update 2016-02. The Bank has determined that standard 2016-02 will have an effect for the Bank. The Bank will adopt ASU 2016-02 and ASU 2018-11 effective January 1, 2019. Based on the lease portfolio as of December 31, 2018, the Bank anticipates recording right of use lease assets and lease liabilities of approximately $23 million on its consolidated balance sheets, with no material impact to its consolidated statements of operations. The Bank will apply the optional transition method from ASU 2018-11 and apply the new lease standard as of January 1, 2019 with comparative periods presented under current GAAP. The Bank does not expect a material adjustment to opening retained earnings upon adoption. In June 2016, the FASB published Accounting Standards Update No. 2016-13 Financial Instruments – Credit Losses. The amendments in this update provide a new impairment model, known as the current expected credit loss model that is based on expected losses rather than incurred losses. The amendments in this update are also intended to reduce the complexity and reduce the number of impairment models entities use to account for debt instruments. For public business entities that meet the GAAP definition of an SEC filer, the effective date for this update for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Bank is evaluating ASU No. 2016-13 and has initiated a working group with multiple members from applicable departments to evaluate the requirements of the new standard, planning for loss modeling requirements consistent with lifetime expected loss estimates, and assessing the impact it will have on current processes. The extent of the impact upon adoption will likely depend on the characteristics of the Bank’s loan portfolio and economic conditions at that date, as well as forecasted conditions thereafter. In August 2018, the FASB published Accounting Standards Update No. 2018-14 Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20) which includes amendments that remove disclosures that no longer are considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as relevant. This update is effective for public business entities for fiscal years beginning after December 15, 2020. Early adoption is permitted. The Bank has determined that this standard will have an effect on certain year-end disclosures in the Employee benefit plans note and has early adopted it for the year ending December 31, 2018. |
Fair Value of Financial Instruments | Management reviews the price of each security monthly, comparing market values to expectations and to the prior month’s price. Management's expectations are based upon knowledge of prevailing market conditions and developments relating to specific issuers and/or asset classes held in the investment portfolio. Where there are unusual or significant price movements, or where a certain asset class has performed out-of-line with expectations, the matter is reviewed by management. Financial instruments in Level 1 include actively traded redeemable mutual funds. Financial instruments in Level 2 include corporate bonds, mortgage-backed securities and other asset-backed securities, forward foreign exchange contracts and mutual funds not actively traded. Financial instruments in Level 3 include asset-backed securities for which the market is relatively illiquid and for which information about actual trading prices is not readily available. |
Cash due from banks (Tables)
Cash due from banks (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of cash due from banks | December 31, 2018 December 31, 2017 Bermuda Non-Bermuda Total Bermuda Non-Bermuda Total Non-interest bearing Cash and demand deposits with banks 21,677 102,505 124,182 24,189 65,192 89,381 Interest bearing¹ Demand deposits with banks 335,841 151,747 487,588 215,363 124,893 340,256 Cash equivalents 364,714 1,077,399 1,442,113 330,247 775,254 1,105,501 Sub-total - Interest bearing 700,555 1,229,146 1,929,701 545,610 900,147 1,445,757 Total cash due from banks 722,232 1,331,651 2,053,883 569,799 965,339 1,535,138 ¹ Interest bearing cash due from banks includes certain demand deposits with banks as at December 31, 2018 in the amount of $204.2 million ( December 31, 2017 : $203.3 million ) that are earning interest at a negligible rate. |
Short-term investments (Tables)
Short-term investments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of short-term investments | December 31, 2018 December 31, 2017 Bermuda Non-Bermuda Total Bermuda Non-Bermuda Total Unrestricted Maturing within three months — 25,459 25,459 67,528 71,986 139,514 Maturing between three to six months — 9,641 9,641 19,841 67,035 86,876 Total unrestricted short-term investments — 35,100 35,100 87,369 139,021 226,390 Affected by drawing restrictions related to minimum reserve and derivative margin requirements Non-interest earning demand deposits — 2,401 2,401 — — — Interest earning demand and term deposits 13,836 999 14,835 22,053 1,541 23,594 Total restricted short-term investments 13,836 3,400 17,236 22,053 1,541 23,594 Total short-term investments 13,836 38,500 52,336 109,422 140,562 249,984 |
Investment in securities (Table
Investment in securities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of marketable securities | December 31, 2018 December 31, 2017 Amortized Gross Gross Fair value Amortized Gross Gross Fair value Trading Mutual funds 5,724 1,176 (405 ) 6,495 5,724 1,616 (516 ) 6,824 Total trading 5,724 1,176 (405 ) 6,495 5,724 1,616 (516 ) 6,824 Available-for-sale US government and federal agencies 1,820,808 3,355 (37,656 ) 1,786,507 2,720,581 8,924 (20,401 ) 2,709,104 Non-US governments debt securities 25,804 19 (398 ) 25,425 26,516 118 (386 ) 26,248 Corporate debt securities 80,177 — (1,464 ) 78,713 243,999 153 (780 ) 243,372 Asset-backed securities - Student loans 13,290 — (664 ) 12,626 13,290 — (797 ) 12,493 Commercial mortgage-backed securities 125,806 6 (2,603 ) 123,209 142,740 56 (1,296 ) 141,500 Residential mortgage-backed securities 160,492 — (4,223 ) 156,269 186,049 309 (1,635 ) 184,723 Total available-for-sale 2,226,377 3,380 (47,008 ) 2,182,749 3,333,175 9,560 (25,295 ) 3,317,440 Held-to-maturity¹ US government and federal agencies 2,066,120 5,012 (34,918 ) 2,036,214 1,381,955 4,813 (9,414 ) 1,377,354 Total held-to-maturity 2,066,120 5,012 (34,918 ) 2,036,214 1,381,955 4,813 (9,414 ) 1,377,354 ¹ For the years ended December 31, 2018 , 2017 and 2016 , non-credit impairments recognized in accumulated other comprehensive loss ("AOCL") for HTM investments were nil . In the following tables, debt securities with unrealized losses that are not deemed to be OTTI are categorized as being in a loss position for "less than 12 months" or "12 months or more" based on the point in time that the fair value most recently declined below the amortized cost basis. In 2018, the classification of certain securities was revised from "less than 12 months" to "12 months or more". The 2017 classification presented below was revised to properly present the disclosure accordingly. Less than 12 months 12 months or more December 31, 2018 Fair value Gross Fair value Gross Total fair value Total gross Available-for-sale securities with unrealized losses US government and federal agencies 372,283 (1,586 ) 1,027,638 (36,070 ) 1,399,921 (37,656 ) Non-US governments debt securities — — 22,360 (398 ) 22,360 (398 ) Corporate debt securities 14,914 (114 ) 63,799 (1,350 ) 78,713 (1,464 ) Asset-backed securities - Student loans — — 12,626 (664 ) 12,626 (664 ) Commercial mortgage-backed securities 812 — 117,379 (2,603 ) 118,191 (2,603 ) Residential mortgage-backed securities 49,804 (1,313 ) 106,465 (2,910 ) 156,269 (4,223 ) Total available-for-sale securities with unrealized losses 437,813 (3,013 ) 1,350,267 (43,995 ) 1,788,080 (47,008 ) Held-to-maturity securities with unrealized losses US government and federal agencies 647,484 (11,468 ) 724,974 (23,450 ) 1,372,458 (34,918 ) Less than 12 months 12 months or more December 31, 2017 Fair value Gross Fair value Gross Total fair value Total gross Available-for-sale securities with unrealized losses US government and federal agencies 467,958 (2,461 ) 1,043,601 (17,940 ) 1,511,559 (20,401 ) Non-US governments debt securities — — 22,360 (386 ) 22,360 (386 ) Corporate debt securities 76,016 (225 ) 49,964 (555 ) 125,980 (780 ) Asset-backed securities - Student loans — — 12,493 (797 ) 12,493 (797 ) Commercial mortgage-backed securities 98,822 (709 ) 36,766 (587 ) 135,588 (1,296 ) Residential mortgage-backed securities 71,604 (486 ) 56,287 (1,149 ) 127,891 (1,635 ) Total available-for-sale securities with unrealized losses 714,400 (3,881 ) 1,221,471 (21,414 ) 1,935,871 (25,295 ) Held-to-maturity securities with unrealized losses US government and federal agencies 549,532 (2,862 ) 288,830 (6,552 ) 838,362 (9,414 ) December 31, 2018 December 31, 2017 Pledged Investments Amortized Fair value Amortized Fair value Available-for-sale 42,531 42,400 149,999 150,900 Held-to-maturity 70,818 69,030 202,303 201,523 |
Summary of investments maturities | Remaining term to maturity December 31, 2018 Within 3 months 3 to 12 months 1 to 5 years 5 to 10 years Over 10 years No specific or single maturity Carrying amount Trading Mutual funds — — — — — 6,495 6,495 Available-for-sale US government and federal agencies — — 34,423 — — 1,752,084 1,786,507 Non-US governments debt securities — 3,064 22,361 — — — 25,425 Corporate debt securities — 14,924 63,789 — — — 78,713 Asset-backed securities - Student loans — — — — — 12,626 12,626 Commercial mortgage-backed securities — — — — — 123,209 123,209 Residential mortgage-backed securities — — — — — 156,269 156,269 Total available-for-sale — 17,988 120,573 — — 2,044,188 2,182,749 Held-to-maturity US government and federal agencies — — — — — 2,066,120 2,066,120 Total investments — 17,988 120,573 — — 4,116,803 4,255,364 Total by currency US dollars — 17,988 120,573 — — 4,116,484 4,255,045 Other — — — — — 319 319 Total investments — 17,988 120,573 — — 4,116,803 4,255,364 |
Schedule of sale proceeds and realized gains and losses of AFS securities | Sale Proceeds and Realized Gains and Losses of AFS Securities Year ended December 31, 2018 Sale proceeds Gross realized Gross realized US government and federal agencies 812,720 1,599 (1,263 ) Corporate debt securities 24,975 — (87 ) Commercial mortgage-backed securities 15,260 — (354 ) Pass-through note 1,205 1,205 — Total 854,160 2,804 (1,704 ) Year ended December 31, 2017 Sale Gross realized Gross realized Corporate debt securities 202,700 1,684 — Commercial mortgage-backed securities 7,785 — (60 ) Pass-through note 2,562 2,562 — Total 213,047 4,246 (60 ) Year ended December 31, 2016 Sale Gross realized Gross realized US government and federal agencies 59,939 1,013 (76 ) Pass-through note 609 609 — Total 60,548 1,622 (76 ) |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Schedule of loans receivable | December 31, 2018 December 31, 2017 Bermuda Non-Bermuda Total Bermuda Non-Bermuda Total Commercial loans Government 92,994 12,670 105,664 139,987 13,414 153,401 Commercial and industrial 291,470 222,393 513,863 197,251 173,701 370,952 Commercial overdrafts 16,342 16,752 33,094 18,649 2,874 21,523 Total gross commercial loans 400,806 251,815 652,621 355,887 189,989 545,876 Less specific allowance for credit losses (2,766 ) (1,687 ) (4,453 ) (2,866 ) — (2,866 ) Net commercial loans 398,040 250,128 648,168 353,021 189,989 543,010 Commercial real estate loans Commercial mortgage 304,519 192,456 496,975 346,094 189,741 535,835 Construction 29,760 48,909 78,669 24,500 23,743 48,243 Total gross commercial real estate loans 334,279 241,365 575,644 370,594 213,484 584,078 Less specific allowance for credit losses (600 ) — (600 ) (550 ) (33 ) (583 ) Net commercial real estate loans 333,679 241,365 575,044 370,044 213,451 583,495 Consumer loans Automobile financing 13,249 6,975 20,224 13,113 6,182 19,295 Credit card 60,466 23,623 84,089 57,777 21,228 79,005 Overdrafts 10,511 2,375 12,886 5,490 2,871 8,361 Other consumer 28,415 35,076 63,491 29,818 51,196 81,014 Total gross consumer loans 112,641 68,049 180,690 106,198 81,477 187,675 Less specific allowance for credit losses (274 ) — (274 ) (274 ) — (274 ) Net consumer loans 112,367 68,049 180,416 105,924 81,477 187,401 Residential mortgage loans 1,121,288 1,538,748 2,660,036 1,156,134 1,338,566 2,494,700 Less specific allowance for credit losses (8,575 ) (1,013 ) (9,588 ) (8,681 ) (1,220 ) (9,901 ) Net residential mortgage loans 1,112,713 1,537,735 2,650,448 1,147,453 1,337,346 2,484,799 Total gross loans 1,969,014 2,099,977 4,068,991 1,988,813 1,823,516 3,812,329 Less specific allowance for credit losses (12,215 ) (2,700 ) (14,915 ) (12,371 ) (1,253 ) (13,624 ) Less general allowance for credit losses (7,098 ) (3,089 ) (10,187 ) (16,339 ) (5,504 ) (21,843 ) Net loans 1,949,701 2,094,188 4,043,889 1,960,103 1,816,759 3,776,862 |
Schedule of age analysis and past due loans | The following tables summarize the past due status of the loans as at December 31, 2018 and December 31, 2017 . The aging of past due amounts are determined based on the contractual delinquency status of payments under the loan and this aging may be affected by the timing of the last business day at period end. Loans less than 30 days past due are included in current loans. December 31, 2018 30 - 59 days 60 - 89 days More than 90 days Total past due loans Total current Total loans Commercial loans Government — — 3,750 3,750 101,914 105,664 Commercial and industrial 231 — 7,379 7,610 506,253 513,863 Commercial overdrafts — — 2 2 33,092 33,094 Total commercial loans 231 — 11,131 11,362 641,259 652,621 Commercial real estate loans Commercial mortgage 837 1,282 4,062 6,181 490,794 496,975 Construction — — — — 78,669 78,669 Total commercial real estate loans 837 1,282 4,062 6,181 569,463 575,644 Consumer loans Automobile financing 125 29 162 316 19,908 20,224 Credit card 351 313 126 790 83,299 84,089 Overdrafts — — 4 4 12,882 12,886 Other consumer 456 183 577 1,216 62,275 63,491 Total consumer loans 932 525 869 2,326 178,364 180,690 Residential mortgage loans 31,015 8,859 36,394 76,268 2,583,768 2,660,036 Total gross loans 33,015 10,666 52,456 96,137 3,972,854 4,068,991 December 31, 2017 30 - 59 days 60 - 89 days More than 90 days Total past due loans Total current Total loans Commercial loans Government — — — — 153,401 153,401 Commercial and industrial — 1,005 7,481 8,486 362,466 370,952 Commercial overdrafts — — 1 1 21,522 21,523 Total commercial loans — 1,005 7,482 8,487 537,389 545,876 Commercial real estate loans Commercial mortgage 392 — 4,781 5,173 530,662 535,835 Construction — — — — 48,243 48,243 Total commercial real estate loans 392 — 4,781 5,173 578,905 584,078 Consumer loans Automobile financing 7 12 226 245 19,050 19,295 Credit card 422 177 170 769 78,236 79,005 Overdrafts — — 4 4 8,357 8,361 Other consumer 797 329 441 1,567 79,447 81,014 Total consumer loans 1,226 518 841 2,585 185,090 187,675 Residential mortgage loans 19,121 10,142 35,658 64,921 2,429,779 2,494,700 Total gross loans 20,739 11,665 48,762 81,166 3,731,163 3,812,329 |
Schedule of financing receivable credit quality indicators | December 31, 2018 Pass Special mention Substandard Non-accrual Total gross recorded investments Commercial loans Government 101,914 — — 3,750 105,664 Commercial and industrial 501,241 4,097 1,146 7,379 513,863 Commercial overdrafts 29,896 2,705 491 2 33,094 Total commercial loans 633,051 6,802 1,637 11,131 652,621 Commercial real estate loans Commercial mortgage 444,397 45,390 3,126 4,062 496,975 Construction 78,669 — — — 78,669 Total commercial real estate loans 523,066 45,390 3,126 4,062 575,644 Consumer loans Automobile financing 19,927 119 16 162 20,224 Credit card 83,963 — 126 — 84,089 Overdrafts 12,650 232 — 4 12,886 Other consumer 60,766 1,869 10 846 63,491 Total consumer loans 177,306 2,220 152 1,012 180,690 Residential mortgage loans 2,501,814 47,039 78,697 32,486 2,660,036 Total gross recorded loans 3,835,237 101,451 83,612 48,691 4,068,991 December 31, 2017 Pass Special mention Substandard Non-accrual Total gross recorded investments Commercial loans Government 149,651 — 3,750 — 153,401 Commercial and industrial 357,298 4,864 1,309 7,481 370,952 Commercial overdrafts 17,558 3,569 395 1 21,523 Total commercial loans 524,507 8,433 5,454 7,482 545,876 Commercial real estate loans Commercial mortgage 464,283 63,663 3,108 4,781 535,835 Construction 48,243 — — — 48,243 Total commercial real estate loans 512,526 63,663 3,108 4,781 584,078 Consumer loans Automobile financing 18,816 232 21 226 19,295 Credit card 78,835 — 170 — 79,005 Overdrafts 8,263 94 — 4 8,361 Other consumer 79,080 1,419 31 484 81,014 Total consumer loans 184,994 1,745 222 714 187,675 Residential mortgage loans 2,351,845 35,996 75,985 30,874 2,494,700 Total gross recorded loans 3,573,872 109,837 84,769 43,851 3,812,329 |
Schedule of allowance for credit loss | Evaluation of Loans For Impairment December 31, 2018 December 31, 2017 Individually evaluated Collectively evaluated Individually evaluated Collectively evaluated Commercial 12,096 640,525 8,487 537,389 Commercial real estate 7,188 568,456 7,889 576,189 Consumer 1,023 179,667 1,138 186,537 Residential mortgage 102,127 2,557,909 99,652 2,395,048 Total gross loans 122,434 3,946,557 117,166 3,695,163 Changes in General and Specific Allowances For Credit Losses Year ended December 31, 2018 Commercial Commercial real estate Consumer Residential mortgage Total Allowances at beginning of year 6,309 10,360 888 17,910 35,467 Provision taken (released) 865 (6,290 ) 211 (1,777 ) (6,991 ) Recoveries 14 28 656 201 899 Charge-offs (275 ) — (953 ) (2,931 ) (4,159 ) Other — (6 ) — (108 ) (114 ) Allowances at end of year 6,913 4,092 802 13,295 25,102 Allowances at end of year: individually evaluated for impairment 4,453 600 274 9,588 14,915 Allowances at end of year: collectively evaluated for impairment 2,460 3,492 528 3,707 10,187 Year ended December 31, 2017 Commercial Commercial real estate Consumer Residential mortgage Total Allowances at beginning of year 3,377 16,224 965 23,681 44,247 Provision taken (released) 2,853 (5,895 ) 1,059 (3,854 ) (5,837 ) Recoveries 106 — 730 483 1,319 Charge-offs (34 ) (1 ) (1,869 ) (2,475 ) (4,379 ) Other 7 32 3 75 117 Allowances at end of year 6,309 10,360 888 17,910 35,467 Allowances at end of year: individually evaluated for impairment 2,866 583 274 9,901 13,624 Allowances at end of year: collectively evaluated for impairment 3,443 9,777 614 8,009 21,843 Year ended December 31, 2016 Commercial Commercial real estate Consumer Residential mortgage Total Allowances at beginning of year 8,723 6,512 2,763 31,304 49,302 Provision taken (released) (5,265 ) 14,459 (1,076 ) (3,719 ) 4,399 Recoveries 97 12 1,264 70 1,443 Charge-offs (138 ) (4,520 ) (1,916 ) (3,837 ) (10,411 ) Other (40 ) (239 ) (70 ) (137 ) (486 ) Allowances at end of year 3,377 16,224 965 23,681 44,247 Allowances at end of year: individually evaluated for impairment 577 750 278 10,133 11,738 Allowances at end of year: collectively evaluated for impairment 2,800 15,474 687 13,548 32,509 |
Schedule of non-accrual status for non-performing loans | Non-Performing Loans (excluding purchased credit-impaired loans) December 31, 2018 December 31, 2017 Non-accrual Past due more than 90 days and accruing Total non- performing loans Non-accrual Past due more than 90 days and accruing Total non- performing loans Commercial loans Government 3,750 — 3,750 — — — Commercial and industrial 7,379 — 7,379 7,481 — 7,481 Commercial overdrafts 2 — 2 1 — 1 Total commercial loans 11,131 — 11,131 7,482 — 7,482 Commercial real estate loans Commercial mortgage 4,062 — 4,062 4,781 — 4,781 Consumer loans Automobile financing 162 — 162 226 — 226 Credit card — 126 126 — 170 170 Overdrafts 4 — 4 4 — 4 Other consumer 846 — 846 484 — 484 Total consumer loans 1,012 126 1,138 714 170 884 Residential mortgage loans 32,486 6,332 38,818 30,874 4,186 35,060 Total non-performing loans 48,691 6,458 55,149 43,851 4,356 48,207 |
Schedule of impaired loans | Impaired loans with an allowance Gross recorded investment of impaired loans without an allowance Total impaired loans December 31, 2018 Gross recorded investment Specific allowance Net loans Gross recorded investment Specific allowance Net loans Commercial loans Government 3,750 (1,687 ) 2,063 — 3,750 (1,687 ) 2,063 Commercial and industrial 7,379 (2,766 ) 4,613 965 8,344 (2,766 ) 5,578 Commercial overdrafts — — — 2 2 — 2 Total commercial loans 11,129 (4,453 ) 6,676 967 12,096 (4,453 ) 7,643 Commercial real estate loans Commercial mortgage 1,081 (600 ) 481 6,108 7,189 (600 ) 6,589 Consumer loans Automobile financing 130 (75 ) 55 32 162 (75 ) 87 Overdrafts — — — 4 4 — 4 Other consumer 199 (199 ) — 647 846 (199 ) 647 Total consumer loans 329 (274 ) 55 683 1,012 (274 ) 738 Residential mortgage loans 49,431 (9,422 ) 40,009 49,571 99,002 (9,422 ) 89,580 Total impaired loans 61,970 (14,749 ) 47,221 57,329 119,299 (14,749 ) 104,550 Specific allowance excludes $0.2 million recognized relating to purchased credit-impaired loans. Impaired loans with an allowance Gross recorded investment of impaired loans without an allowance Total impaired loans December 31, 2017 Gross recorded investment Specific allowance Net loans Gross recorded investment Specific allowance Net loans Commercial loans Commercial and industrial 7,475 (2,866 ) 4,609 1,011 8,486 (2,866 ) 5,620 Commercial overdrafts — — — 1 1 — 1 Total commercial loans 7,475 (2,866 ) 4,609 1,012 8,487 (2,866 ) 5,621 Commercial real estate loans Commercial mortgage 1,585 (583 ) 1,002 6,304 7,889 (583 ) 7,306 Consumer loans Automobile financing 138 (75 ) 63 88 226 (75 ) 151 Overdrafts — — — 4 4 — 4 Other consumer 199 (199 ) — 285 484 (199 ) 285 Total consumer loans 337 (274 ) 63 377 714 (274 ) 440 Residential mortgage loans 53,698 (9,630 ) 44,068 42,055 95,753 (9,630 ) 86,123 Total impaired loans 63,095 (13,353 ) 49,742 49,748 112,843 (13,353 ) 99,490 Specific allowance excludes $0.3 million recognized relating to purchased credit-impaired loans. Average Impaired Loan Balances and Related Recognized Interest Income December 31, 2018 December 31, 2017 December 31, 2016 Average gross recorded investment Interest Average gross recorded investment Interest Average gross recorded investment Interest Commercial loans Government 3,750 — — — — — Commercial and industrial 8,415 68 5,057 63 1,661 64 Commercial overdrafts 2 — 2 — 14 — Total commercial loans 12,167 68 5,059 63 1,675 64 Commercial real estate loans Commercial mortgage 7,539 287 7,778 222 15,496 237 Consumer loans Automobile financing 194 — 256 — 192 — Overdrafts 4 — 11 — 14 — Other consumer 665 — 598 — 1,043 — Total consumer loans 863 — 865 — 1,249 — Residential mortgage loans 97,378 4,568 89,063 4,378 81,901 2,201 Total impaired loans 117,947 4,923 102,765 4,663 100,321 2,502 ¹ All interest income recognized on impaired loans relate to loans previously modified in a TDR. |
Schedule of troubled debt restructuring | TDRs entered into during the year Year ended December 31, 2018 Number of contracts Pre- modification recorded investment Modification: Post- modification recorded investment Residential mortgage loans 19 7,864 846 8,710 Total loans modified in a TDR 19 7,864 846 8,710 Year ended December 31, 2017 Number of Pre- Modification: Post- Commercial real estate loans 2 1,544 — 1,544 Residential mortgage loans 42 24,588 1,345 25,933 Total loans modified in a TDR 44 26,132 1,345 27,477 Year ended December 31, 2016 Number of contracts Pre- modification recorded investment Modification: Post- modification recorded investment Residential mortgage loans 21 12,543 81 12,624 Total loans modified in a TDR 21 12,543 81 12,624 December 31, 2018 December 31, 2017 TDRs outstanding Accrual Non-accrual Accrual Non-accrual Commercial loans 965 — 1,005 — Commercial real estate loans 3,127 1,336 3,108 1,471 Residential mortgage loans 66,516 8,154 64,879 5,623 Total TDRs outstanding 70,608 9,490 68,992 7,094 |
Schedule of purchased credit-impaired loans | Year ended December 31, 2018 Contractual principal Non-accretable difference Accretable difference Carrying amount Balance at beginning of year 6,001 (1,239 ) (711 ) 4,051 Advances and increases in cash flows expected to be collected 25 42 (42 ) 25 Reductions resulting from repayments (1,495 ) 191 92 (1,212 ) Reductions resulting from changes in allowances for credit losses — 105 — 105 Balance at end of year 4,531 (901 ) (661 ) 2,969 Year ended December 31, 2017 Contractual principal Non-accretable difference Accretable difference Carrying amount Balance at beginning of year 8,016 (1,617 ) (811 ) 5,588 Advances and increases in cash flows expected to be collected 36 48 (48 ) 36 Reductions resulting from repayments (1,581 ) 307 148 (1,126 ) Reductions resulting from changes in allowances for credit losses — (99 ) — (99 ) Reductions resulting from charge-offs (470 ) 122 — (348 ) Balance at end of year 6,001 (1,239 ) (711 ) 4,051 Year ended December 31, 2016 Contractual principal Non-accretable difference Accretable difference Carrying amount Balance at beginning of year 8,709 (2,248 ) (631 ) 5,830 Advances and increases in cash flows expected to be collected 166 408 (396 ) 178 Reductions resulting from repayments (464 ) — 216 (248 ) Reductions resulting from changes in allowances for credit losses — (172 ) — (172 ) Reductions resulting from charge-offs (395 ) 395 — — Balance at end of year 8,016 (1,617 ) (811 ) 5,588 |
Credit risk concentrations (Tab
Credit risk concentrations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Summary of credit exposure | The following tables summarize the credit exposure of the Bank by business sector and by geographic region. The on-balance sheet exposure amounts disclosed are net of specific allowances and the off-balance sheet exposure amounts disclosed are gross of collateral held. December 31, 2018 December 31, 2017 Business sector Loans Off-balance sheet Total credit exposure Loans Off-balance sheet Total credit exposure Banks and financial services 611,404 415,124 1,026,528 459,132 390,278 849,410 Commercial and merchandising 316,349 182,440 498,789 261,560 193,583 455,143 Governments 104,857 — 104,857 153,952 85,807 239,759 Individuals 2,339,854 89,931 2,429,785 2,274,632 114,215 2,388,847 Primary industry and manufacturing 120,088 1,003 121,091 59,532 9,567 69,099 Real estate 395,086 1,547 396,633 439,595 2,225 441,820 Hospitality industry 160,680 3,497 164,177 144,808 73 144,881 Transport and communication 5,758 75 5,833 5,494 — 5,494 Sub-total 4,054,076 693,617 4,747,693 3,798,705 795,748 4,594,453 General allowance (10,187 ) — (10,187 ) (21,843 ) — (21,843 ) Total 4,043,889 693,617 4,737,506 3,776,862 795,748 4,572,610 December 31, 2018 December 31, 2017 Geographic region Cash due from Loans Off-balance sheet Total credit exposure Cash due from Loans Off-balance sheet Total credit exposure Australia 145,675 — — 145,675 113,920 — — 113,920 Bermuda 36,827 2,133,859 333,845 2,504,531 14,512 2,132,918 418,850 2,566,280 Canada 759,437 — — 759,437 386,322 — — 386,322 Cayman 18,138 730,418 222,189 970,745 67,942 669,767 229,731 967,440 Guernsey 6 290,578 22,619 313,203 3 292,806 41,648 334,457 Japan 14,271 — — 14,271 12,852 — — 12,852 Jersey — 9,083 449 9,532 — — — — New Zealand 1,082 — — 1,082 7,951 — — 7,951 Norway 8,750 — — 8,750 25,440 — — 25,440 Saint Lucia — 90,000 — 90,000 — 120,000 — 120,000 Switzerland 6,637 — — 6,637 5,743 — — 5,743 The Bahamas 1,534 14,367 — 15,901 1,652 17,451 — 19,103 United Kingdom 725,634 783,708 114,515 1,623,857 775,853 562,013 105,519 1,443,385 United States 411,248 — — 411,248 544,703 — — 544,703 Other 4,321 2,063 — 6,384 6,998 3,750 — 10,748 Sub-total 2,133,560 4,054,076 693,617 6,881,253 1,963,891 3,798,705 795,748 6,558,344 General allowance — (10,187 ) — (10,187 ) — (21,843 ) — (21,843 ) Total 2,133,560 4,043,889 693,617 6,871,066 1,963,891 3,776,862 795,748 6,536,501 |
Premises, equipment and compu_2
Premises, equipment and computer software (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of premise, equipment, and computer software | December 31, 2018 December 31, 2017 Category Cost Accumulated Net carrying Cost Accumulated Net carrying Land 8,612 — 8,612 9,008 — 9,008 Buildings 144,196 (61,853 ) 82,343 139,534 (59,110 ) 80,424 Equipment 21,323 (15,490 ) 5,833 20,000 (15,997 ) 4,003 Computer hardware and software in use 177,017 (121,652 ) 55,365 165,251 (102,449 ) 62,802 Computer software in development 5,907 — 5,907 8,553 — 8,553 Total 357,055 (198,995 ) 158,060 342,346 (177,556 ) 164,790 Year ended Depreciation charged to operating expenses December 31, 2018 December 31, 2017 December 31, 2016 Buildings (included in Property expense) 4,283 3,781 4,058 Equipment (included in Property expense) 1,413 1,336 1,462 Computer hardware and software (included in Technology and communication expense) 20,441 18,382 18,757 Total depreciation charged to operating expenses 26,137 23,499 24,277 |
Goodwill and other intangible_2
Goodwill and other intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | Segment Cayman Channel Islands and the UK Other Total Balance at December 31, 2015 — 23,462 — 23,462 Foreign exchange translation adjustment — (3,840 ) — (3,840 ) Balance at December 31, 2016 — 19,622 — 19,622 Foreign exchange translation adjustment — 1,907 — 1,907 Balance at December 31, 2017 — 21,529 — 21,529 Acquisitions during the year 551 1,231 2,086 3,868 Foreign exchange translation adjustment — (1,333 ) (73 ) (1,406 ) Balance at December 31, 2018 551 21,427 2,013 23,991 |
Schedule of customer relationship intangible assets | December 31, 2018 December 31, 2017 Business segment Cost Accumulated Net carrying Cost Accumulated Net carrying Bermuda 29,785 (11,733 ) 18,052 29,785 (9,748 ) 20,037 Cayman 17,728 (4,571 ) 13,157 12,324 (3,557 ) 8,767 Channel Islands and the UK 65,698 (51,210 ) 14,488 58,420 (48,158 ) 10,262 Other 5,563 (509 ) 5,054 — — — Total 118,774 (68,023 ) 50,751 100,529 (61,463 ) 39,066 |
Customer deposits and deposit_2
Customer deposits and deposits from banks (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
Schedule of maturities of deposits | By Maturity Demand Total demand deposits Term Total term deposits December 31, 2018 Non-interest bearing Interest bearing Within 3 months 3 to 6 months 6 to 12 months After 12 months Total deposits Customers Bermuda Demand or less than $100k¹ 1,378,539 2,158,971 3,537,510 12,387 4,306 8,049 14,644 39,386 3,576,896 Term - $100k or more N/A N/A — 598,528 92,427 184,337 43,414 918,706 918,706 Total Bermuda 1,378,539 2,158,971 3,537,510 610,915 96,733 192,386 58,058 958,092 4,495,602 Non-Bermuda Demand or less than $100k 1 732,957 3,179,376 3,912,333 18,714 5,386 4,705 507 29,312 3,941,645 Term and $100k or more N/A N/A — 608,390 126,022 235,278 11,482 981,172 981,172 Total non-Bermuda 732,957 3,179,376 3,912,333 627,104 131,408 239,983 11,989 1,010,484 4,922,817 Total customer deposits 2,111,496 5,338,347 7,449,843 1,238,019 228,141 432,369 70,047 1,968,576 9,418,419 Banks Bermuda Demand or less than $100k 8,100 — 8,100 — — — — — 8,100 Non-Bermuda Demand or less than $100k — 18,965 18,965 — — — — — 18,965 Term and $100k or more N/A N/A — 6,656 — 101 — 6,757 6,757 Total non-Bermuda — 18,965 18,965 6,656 — 101 — 6,757 25,722 Total bank deposits 8,100 18,965 27,065 6,656 — 101 — 6,757 33,822 Total deposits 2,119,596 5,357,312 7,476,908 1,244,675 228,141 432,470 70,047 1,975,333 9,452,241 Demand Total demand deposits Term Total term deposits December 31, 2017 Non-interest bearing Interest bearing Within 3 months 3 to 6 months 6 to 12 months After 12 months Total deposits Customers Bermuda Demand or less than $100k¹ 1,840,201 2,578,411 4,418,612 13,983 4,267 8,640 13,984 40,874 4,459,486 Term - $100k or more N/A N/A — 646,751 33,495 75,235 37,857 793,338 793,338 Total Bermuda 1,840,201 2,578,411 4,418,612 660,734 37,762 83,875 51,841 834,212 5,252,824 Non-Bermuda Demand or less than $100k 1 639,525 2,755,517 3,395,042 19,147 5,202 4,762 781 29,892 3,424,934 Term and $100k or more N/A N/A — 657,134 88,650 94,245 6,205 846,234 846,234 Total non-Bermuda 639,525 2,755,517 3,395,042 676,281 93,852 99,007 6,986 876,126 4,271,168 Total customer deposits 2,479,726 5,333,928 7,813,654 1,337,015 131,614 182,882 58,827 1,710,338 9,523,992 Banks Bermuda Demand or less than $100k 442 — 442 — — — — — 442 Non-Bermuda Demand or less than $100k — 7,704 7,704 — — — — — 7,704 Term and $100k or more N/A N/A — 4,220 — 100 — 4,320 4,320 Total non-Bermuda — 7,704 7,704 4,220 — 100 — 4,320 12,024 Total bank deposits 442 7,704 8,146 4,220 — 100 — 4,320 12,466 Total deposits 2,480,168 5,341,632 7,821,800 1,341,235 131,614 182,982 58,827 1,714,658 9,536,458 ¹ The weighted-average interest rate on interest-bearing demand deposits as at December 31, 2018 is 0.13% ( December 31, 2017 : 0.02% ). |
Schedule of deposits by type and segment | By Type and Segment December 31, 2018 December 31, 2017 Payable on demand Payable on a fixed date Total Payable on demand Payable on a fixed date Total Bermuda Customers 3,537,510 958,092 4,495,602 4,418,649 834,211 5,252,860 Banks 8,100 — 8,100 442 — 442 Cayman Customers 2,847,793 472,442 3,320,235 2,529,499 405,215 2,934,714 Banks 17,564 6,757 24,321 7,704 4,320 12,024 Channel Islands and the UK Customers 1,064,540 538,042 1,602,582 865,506 470,912 1,336,418 Banks 1,401 — 1,401 — — — Total Customers 7,449,843 1,968,576 9,418,419 7,813,654 1,710,338 9,523,992 Total Banks 27,065 6,757 33,822 8,146 4,320 12,466 Total deposits 7,476,908 1,975,333 9,452,241 7,821,800 1,714,658 9,536,458 |
Employee benefit plans (Tables)
Employee benefit plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
Summary of financial position of the Bank’s defined benefit pension plans and the Bank’s post-retirement medical benefits | The following table presents the financial position of the Bank’s defined benefit pension plans and the Bank’s post-retirement medical benefit plan, which is unfunded. The Bank measures the benefit obligations and plan assets annually on each December 31 and therefore, the most recent measurement date is December 31, 2018 . December 31, 2018 December 31, 2017 December 31, 2016 Pension Post- Pension Post- Pension Post- Accumulated benefit obligation at end of year 148,966 117,203 179,613 127,687 178,068 126,334 Change in projected benefit obligation Projected benefit obligation at beginning of year 179,613 127,687 178,068 126,334 166,815 119,107 Service cost — 63 — 64 — 118 Interest cost 4,971 4,305 5,361 4,703 5,781 4,792 Benefits paid (17,274 ) (3,263 ) (13,444 ) (2,118 ) (10,477 ) (3,594 ) Prior service cost 212 — — — — — Settlement and curtailment of liability (1,825 ) — (6,108 ) — — — Actuarial (gain) loss (12,423 ) (11,589 ) 7,384 (1,296 ) 30,953 5,911 Foreign exchange translation adjustment (4,308 ) — 8,352 — (15,004 ) — Projected benefit obligation at end of year 148,966 117,203 179,613 127,687 178,068 126,334 Change in plan assets Fair value of plan assets at beginning of year 185,495 — 172,206 — 179,961 — Actual return on plan assets (11,618 ) — 14,801 — 18,615 — Employer contribution 3,653 3,263 8,448 2,118 678 3,594 Plan settlement (1,608 ) — (5,123 ) — — — Benefits paid (17,274 ) (3,263 ) (13,444 ) (2,118 ) (10,477 ) (3,594 ) Foreign exchange translation adjustment (4,497 ) — 8,607 — (16,571 ) — Fair value of plan assets at end of year 154,151 — 185,495 — 172,206 — Amounts recognized in the consolidated balance sheets consist of: Prepaid benefit cost included in other assets 5,185 — 6,993 — 7,771 — Accrued pension benefit cost included in employee benefit plans liability — (117,203 ) (1,111 ) (127,687 ) (13,633 ) (126,334 ) Surplus (deficit) of plan assets over projected benefit obligation at measurement date 5,185 (117,203 ) 5,882 (127,687 ) (5,862 ) (126,334 ) |
Schedule of amounts recognized in accumulated other comprehensive loss | Year ended December 31, 2018 December 31, 2017 December 31, 2016 Pension Post- Pension Post- Pension Post- Amounts recognized in accumulated other comprehensive loss consist of: Net actuarial gain (loss), excluding deferred taxes (65,506 ) (12,946 ) (62,521 ) (27,150 ) (64,852 ) (31,959 ) Net prior service credit (cost) (202 ) (6,397 ) — (6,436 ) — (5,678 ) Deferred income taxes assets (liabilities) 816 — 1,180 — 1,620 — Net amount recognized in accumulated other comprehensive loss (64,892 ) (19,343 ) (61,341 ) (33,586 ) (63,232 ) (37,637 ) Annual Benefit Expense Expense component Line item in the consolidated statements of operations Service cost Salaries and other employee benefits — 63 — 64 — 118 Interest cost Non-service employee benefits expense 4,971 4,305 5,361 4,703 5,781 4,792 Expected return on plan assets Non-service employee benefits expense (8,720 ) — (8,199 ) — (8,943 ) — Amortization of net actuarial (gains) losses Non-service employee benefits expense 2,106 2,615 2,238 3,514 1,702 2,731 Amortization of prior service (credit) loss Non-service employee benefits expense — 39 — (759 ) — (6,343 ) (Gain) loss on settlement Net other gains (losses) / Non-service employee benefits expense 1,757 — 1,232 — — — Defined benefit (income) expense 114 7,022 632 7,522 (1,460 ) 1,298 Defined contribution expense 7,442 — 6,521 — 6,606 — Total benefit (income) expense 7,556 7,022 7,153 7,522 5,146 1,298 The components of benefit expense (income) other than the service cost component are included in the line item non-service employee benefits expense in the consolidated statements of income. Other Changes Recognized in Other Comprehensive Income (Loss) Net gain (loss) arising during the year (5,987 ) 11,589 1,472 1,296 (19,956 ) (5,911 ) Prior service credit (cost) arising during the year (212 ) — — — — — Amortization of net actuarial (gains) losses 2,106 2,615 2,247 3,514 1,702 2,731 Amortization of prior service (credit) cost — 39 — (759 ) — (6,343 ) Change in deferred taxes (298 ) — (595 ) — 1,315 — Foreign exchange adjustment 840 — (1,233 ) — 38 — Total changes recognized in other comprehensive income (loss) (3,551 ) 14,243 1,891 4,051 (16,901 ) (9,523 ) |
Schedule of actuarial assumptions | Actuarial Assumptions Year ended December 31, 2018 December 31, 2017 December 31, 2016 Pension plans Post- retirement medical benefit plan Pension plans Post- retirement medical benefit plan Pension Post- Actuarial assumptions used to determine annual benefit expense Weighted average discount rate 3.05 % 3.73 % 3.40 % 4.37 % 3.90 % 4.70 % Weighted average rate of compensation increases 1 2.50 % N/A 2.50 % N/A 2.30 % N/A Weighted average expected long-term rate of return on plan assets 4.70 % N/A 4.75 % N/A 5.30 % N/A Weighted average annual medical cost increase rate (sensitivity shown below) N/A 7.7% to 4.5% in 2035 N/A 7.8% to 4.5% in 2035 N/A 8.0% to 4.5% in 2035 Actuarial assumptions used to determine benefit obligations at end of year Weighted average discount rate 3.65 % 4.40 % 3.05 % 3.73 % 3.40 % 4.37 % Weighted average rate of compensation increases 1 2.50 % N/A 2.40 % N/A 2.50 % N/A Weighted average annual medical cost increase rate (sensitivity shown below) N/A 7.5% to 4.5% in 2035 N/A 7.7% to 4.5% in 2035 N/A 7.8% to 4.5% in 2035 1 Only the United Kingdom subsidiary plan is impacted by potential future compensation increases. |
Schedule of allocation of plan assets | The following table presents the fair value of plans' assets by category and level of inputs used in their respective fair value determination as described in Note 2: Significant accounting policies, except the level 3 security, for which the valuation determination is described following the below table: December 31, 2018 December 31, 2017 Fair value determination Fair value determination Level 1 Level 2 Level 3 Total fair value Level 1 Level 2 Level 3 Total fair value US government and federal agencies — 10,221 — 10,221 — 11,318 — 11,318 Non-US governments debt securities — 1,039 — 1,039 — 12,139 — 12,139 Corporate debt securities — 39,589 — 39,589 — 39,072 — 39,072 Equity securities and mutual funds 925 83,638 — 84,563 1,096 95,294 — 96,390 Other — 1,779 16,960 18,739 — 10,917 15,659 26,576 Total fair value of plans' assets 925 136,266 16,960 154,151 1,096 168,740 15,659 185,495 December 31, 2018 December 31, 2017 Weighted average actual and target asset allocations of the pension plans by asset category Actual allocation Target allocation Actual allocation Target allocation Debt securities (including debt mutual funds) 33 % 47 % 34 % 48 % Equity securities (including equity mutual funds) 55 % 37 % 52 % 47 % Other 12 % 16 % 14 % 5 % Total 100 % 100 % 100 % 100 % |
Schedule of expected benefit payments | Estimated 2019 Bank contribution to and estimated benefit payments for the next ten years under the pension and post-retirement medical benefit plans are as follows: Pension plans Post- retirement medical benefit plan Estimated Bank contributions for the full year ending December 31, 2019 2,500 4,757 Estimated benefit payments by year: 2019 6,600 4,757 2020 6,600 5,076 2021 6,600 5,415 2022 6,600 5,743 2023 6,500 6,073 2024-2028 31,200 34,865 |
Credit-related arrangements, _2
Credit-related arrangements, repurchase agreements and commitments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual obligation, fiscal year maturity schedule | The following table summarizes the Bank's commitments for sourcing, long-term leases and other agreements: Year ending December 31 Sourcing Leases Other Total 2019 14,721 5,448 7,990 28,159 2020 13,353 5,524 2,214 21,091 2021 11,112 4,696 1,634 17,442 2022 — 4,317 727 5,044 2023 — 3,609 719 4,328 2024 & thereafter — 3,583 719 4,302 Total commitments 39,186 27,177 14,003 80,366 |
Schedule of fair value, off-balance sheet risks | Outstanding unfunded commitments to extend credit December 31, 2018 December 31, 2017 Commitments to extend credit 445,215 602,740 Documentary and commercial letters of credit 561 1,263 Total unfunded commitments to extend credit 445,776 604,003 |
Summary of credit-related arrangements | The following table presents the outstanding financial guarantees. Collateral is shown at estimated market value less selling cost. Where the collateral is cash, it is shown gross including accrued income. December 31, 2018 December 31, 2017 Outstanding financial guarantees Gross Collateral Net Gross Collateral Net Standby letters of credit 245,156 237,051 8,105 186,408 178,158 8,250 Letters of guarantee 2,685 2,599 86 5,337 5,251 86 Total 247,841 239,650 8,191 191,745 183,409 8,336 |
Exit cost obligations (Tables)
Exit cost obligations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and related costs | Expense recognized by year Amounts paid by year Exit cost liability Year ended December 31, 2018 Years 2017, 2016 and 2015 Costs to be recognized in the future Total exit costs expected to be incurred Year ended December 31, 2018 Years 2017, 2016 and 2015 As at December 31, 2018 As at December 31, 2017 Staff redundancy expenses — 3,680 — 3,680 — 3,680 — — Professional services — 4,388 — 4,388 — 4,388 — — Lease termination expenses — 649 — 649 — 649 — — Other expenses — 1,504 — 1,504 — 1,504 — — Total — 10,221 — 10,221 — 10,221 — — |
Loan interest income (Tables)
Loan interest income (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |
Summary of interest and other income | Year ended Contractual interest December 31, 2018 December 31, 2017 December 31, 2016 Contractual interest earned on mortgages 136,984 125,980 122,541 Contractual interest earned on other loans 76,924 57,591 62,788 Subtotal contractual interest earned 213,908 183,571 185,329 Amortization Amortization of fair value hedge (501 ) (722 ) (1,120 ) Amortization of loan origination fees (net of amortized costs) 5,088 4,171 3,791 Total loan interest income 218,495 187,020 188,000 Balance of unamortized fair value hedge included in loans as at year end 1,992 2,493 3,215 Balance of unamortized loan fees included in loans as at year end 10,010 9,364 6,313 |
Segmented information (Tables)
Segmented information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | Total Assets by Segment December 31, 2018 December 31, 2017 Bermuda 5,387,347 6,053,546 Cayman 3,705,468 3,242,343 Channel Islands and the UK 1,966,547 1,586,134 Other 30,035 13,859 Total assets before inter-segment eliminations 11,089,397 10,895,882 Less: inter-segment eliminations (316,219 ) (116,645 ) Total 10,773,178 10,779,237 2018 Net interest income Provision for credit losses Non-interest income Revenue before gains and losses Gains and losses Total net revenue Total expenses Net income Year ended December 31 Customer Inter- segment Bermuda 202,901 2,383 6,823 87,352 299,459 (20 ) 299,439 202,318 97,121 Cayman 102,793 416 1,297 47,781 152,287 349 152,636 60,666 91,970 Channel Islands and the UK 37,276 (2,799 ) (1,129 ) 26,824 60,172 (1,185 ) 58,987 50,353 8,634 Other 19 — — 15,157 15,176 1 15,177 17,718 (2,541 ) Total before eliminations 342,989 — 6,991 177,114 527,094 (855 ) 526,239 331,055 195,184 Inter-segment eliminations — — — (8,428 ) (8,428 ) — (8,428 ) (8,428 ) — Total 342,989 — 6,991 168,686 518,666 (855 ) 517,811 322,627 195,184 2017 Net interest income Provision for credit losses Non-interest income Revenue before gains and losses Gains and losses Total net revenue Total expenses Net income Year ended December 31 Customer Inter- segment Bermuda 178,600 1,324 4,618 81,416 265,958 2,785 268,743 192,293 76,450 Cayman 86,074 3 1,033 46,004 133,114 (28 ) 133,086 59,400 73,686 Channel Islands and the UK 24,978 (1,367 ) 186 24,445 48,242 (1,488 ) 46,754 43,758 2,996 Other 92 40 — 11,424 11,556 — 11,556 11,436 120 Total before eliminations 289,744 — 5,837 163,289 458,870 1,269 460,139 306,887 153,252 Inter-segment eliminations — — — (5,464 ) (5,464 ) — (5,464 ) (5,464 ) — Total 289,744 — 5,837 157,825 453,406 1,269 454,675 301,423 153,252 2016 Net interest income Provision for credit losses Non-interest income Revenue before gains and losses Gains and losses Total net revenue Total expenses Net income Year ended December 31 Customer Inter- segment Bermuda 160,466 1,642 (7,263 ) 71,765 226,610 1,412 228,022 164,581 63,441 Cayman 79,644 388 2,135 41,364 123,531 (532 ) 122,999 60,613 62,386 Channel Islands and the UK 18,283 (2,060 ) 729 28,155 45,107 134 45,241 55,387 (10,146 ) Other 87 30 — 9,194 9,311 — 9,311 9,050 261 Total before eliminations 258,480 — (4,399 ) 150,478 404,559 1,014 405,573 289,631 115,942 Inter-segment eliminations — — — (3,005 ) (3,005 ) — (3,005 ) (3,005 ) — Total 258,480 — (4,399 ) 147,473 401,554 1,014 402,568 286,626 115,942 |
Derivative instruments and ri_2
Derivative instruments and risk management (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of notional amounts and related fair value measurements of derivative instruments | The following table shows the aggregate notional amounts of derivative contracts outstanding listed by type and respective gross positive or negative fair values and classified by those used for risk management (sub-classified as hedging and those that do not qualify for hedge accounting), client services and credit derivatives. Fair value of derivatives is recorded in the consolidated balance sheets in other assets and other liabilities. Gross positive fair values are recorded in other assets and gross negative fair values are recorded in other liabilities, subject to netting when master netting agreements are in place. December 31, 2018 Derivative instrument Number of contracts Notional amounts Gross positive fair value Gross negative fair value Net fair value Risk management derivatives Derivatives not formally designated as hedging instruments Currency swaps 8 238,810 269 (601 ) (332 ) Client services derivatives Spot and forward foreign exchange 288 2,064,762 13,331 (12,671 ) 660 Total derivative instruments 2,303,572 13,600 (13,272 ) 328 December 31, 2017 Derivative instrument Number of contracts Notional amounts Gross positive fair value Gross negative fair value Net fair value Risk management derivatives Derivatives not formally designated as hedging instruments Currency swaps 8 183,719 726 (2,754 ) (2,028 ) Client services derivatives Spot and forward foreign exchange 120 2,130,224 10,595 (9,911 ) 684 Total derivative instruments 2,313,943 11,321 (12,665 ) (1,344 ) |
Schedule of offsetting assets | Gross fair Less: offset applied under master netting agreements Net fair value presented in the consolidated balance sheets Less: positions not offset in the consolidated balance sheets December 31, 2018 Gross fair value of derivatives Cash collateral received / paid Net exposures Derivative assets Spot and forward foreign exchange and currency swaps 13,600 (2,036 ) 11,564 — (3,216 ) 8,348 Derivative liabilities Spot and forward foreign exchange and currency swaps 13,272 (2,036 ) 11,236 — (1,861 ) 9,375 Net positive fair value 328 Gross fair Less: offset applied under master netting agreements Net fair value presented in the consolidated balance sheets Less: positions not offset in the consolidated balance sheets December 31, 2017 Gross fair value of derivatives Cash collateral received / paid Net exposures Derivative assets Spot and forward foreign exchange and currency swaps 11,321 (2,197 ) 9,124 — (6,196 ) 2,928 Derivative liabilities Spot and forward foreign exchange and currency swaps 12,665 (2,197 ) 10,468 — — 10,468 Net negative fair value (1,344 ) |
Schedule of offsetting liabilities | Gross fair Less: offset applied under master netting agreements Net fair value presented in the consolidated balance sheets Less: positions not offset in the consolidated balance sheets December 31, 2018 Gross fair value of derivatives Cash collateral received / paid Net exposures Derivative assets Spot and forward foreign exchange and currency swaps 13,600 (2,036 ) 11,564 — (3,216 ) 8,348 Derivative liabilities Spot and forward foreign exchange and currency swaps 13,272 (2,036 ) 11,236 — (1,861 ) 9,375 Net positive fair value 328 Gross fair Less: offset applied under master netting agreements Net fair value presented in the consolidated balance sheets Less: positions not offset in the consolidated balance sheets December 31, 2017 Gross fair value of derivatives Cash collateral received / paid Net exposures Derivative assets Spot and forward foreign exchange and currency swaps 11,321 (2,197 ) 9,124 — (6,196 ) 2,928 Derivative liabilities Spot and forward foreign exchange and currency swaps 12,665 (2,197 ) 10,468 — — 10,468 Net negative fair value (1,344 ) |
Schedule of location and amount of gains (losses) recorded in either the consolidated statements of operations or consolidated statements of comprehensive income on derivative instruments outstanding | The following tables show the location and amount of gains (losses) recorded in either the consolidated statements of operations or consolidated statements of comprehensive income on derivative instruments outstanding. During 2016, management revised the following disclosures to segregate the gains and losses attributable to the specific types of derivatives. Year ended Derivative instrument Consolidated statements of operations line item December 31, 2018 December 31, 2017 December 31, 2016 Spot and forward foreign exchange Foreign exchange revenue (25 ) 541 (322 ) Currency swaps, not designated as hedge Foreign exchange revenue 1,697 (4,916 ) 2,710 Currency swaps - net investment hedge Foreign exchange revenue — (11,334 ) (1,091 ) Total net gains (losses) recognized in net income 1,672 (15,709 ) 1,297 Derivative instrument Consolidated statements of comprehensive income line item December 31, 2018 December 31, 2017 December 31, 2016 Currency swaps - net investment hedge Net change in unrealized gains and (losses) on translation of net investment in foreign operations — (4,410 ) 12,713 Total net gains (losses) recognized in comprehensive income — (4,410 ) 12,713 |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial assets and liabilities that are measured at fair value on a recurring basis | December 31, 2018 December 31, 2017 Fair value Total carrying amount / fair value Fair value Total carrying amount / fair value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Items that are recognized at fair value on a recurring basis: Financial assets Trading investments Mutual funds 6,176 319 — 6,495 6,616 208 — 6,824 Total trading 6,176 319 — 6,495 6,616 208 — 6,824 Available-for-sale investments US government and federal agencies — 1,786,507 — 1,786,507 — 2,709,104 — 2,709,104 Non-US governments debt securities — 25,425 — 25,425 — 26,248 — 26,248 Corporate debt securities — 78,713 — 78,713 — 243,372 — 243,372 Asset-backed securities - Student loans — — 12,626 12,626 — — 12,493 12,493 Commercial mortgage-backed securities — 123,209 — 123,209 — 141,500 — 141,500 Residential mortgage-backed securities — 156,269 — 156,269 — 184,723 — 184,723 Total available-for-sale — 2,170,123 12,626 2,182,749 — 3,304,947 12,493 3,317,440 Other assets - Derivatives — 11,564 — 11,564 — 9,124 — 9,124 Financial liabilities Other liabilities - Derivatives — 11,236 — 11,236 — 10,468 — 10,468 |
Schedule of level 3 reconciliation | December 31, 2018 December 31, 2017 December 31, 2016 Available- for-sale investments Available- for-sale investments Available- Carrying amount at beginning of year 12,493 12,493 12,161 Realized and unrealized gains (losses) recognized in other comprehensive income 133 — 332 Carrying amount at end of year 12,626 12,493 12,493 |
Items other than those recognized at fair value on a recurring basis | Items Other Than Those Recognized at Fair Value on a Recurring Basis: December 31, 2018 December 31, 2017 Level Carrying amount Fair value Appreciation / (depreciation) Carrying amount Fair value Appreciation / (depreciation) Financial assets Cash due from banks Level 1 2,053,883 2,053,883 — 1,535,138 1,535,138 — Securities purchased under agreement to resell Level 2 27,341 27,341 — 178,769 178,769 — Short-term investments Level 1 52,336 52,336 — 249,984 249,984 — Investments held-to-maturity Level 2 2,066,120 2,036,214 (29,906 ) 1,381,955 1,377,354 (4,601 ) Loans, net of allowance for credit losses Level 2 4,043,889 4,047,262 3,373 3,776,862 3,770,450 (6,412 ) Other real estate owned¹ Level 2 5,346 5,346 — 9,127 9,127 — Financial liabilities Customer deposits Demand deposits Level 2 7,449,843 7,449,843 — 7,813,654 7,813,654 — Term deposits Level 2 1,968,576 1,970,004 (1,428 ) 1,710,338 1,710,223 115 Deposits from banks Level 2 33,822 33,822 — 12,466 12,466 — Long-term debt Level 2 143,322 146,261 (2,939 ) 117,000 118,321 (1,321 ) ¹ The current carrying value of OREO is adjusted to fair value only when there is devaluation below carrying value. |
Interest rate risk (Tables)
Interest rate risk (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Assets, liabilities and shareholders' equity and off-balance sheet instruments on the date of the earlier of contractual maturity, expected maturity or repricing date | The following tables set out the assets, liabilities and shareholders' equity and off-balance sheet instruments on the date of the earlier of contractual maturity, expected maturity or repricing date. Use of these tables to derive information about the Bank’s interest rate risk position is limited by the fact that customers may choose to terminate their financial instruments at a date earlier than the contractual maturity or repricing date. Examples of this include fixed-rate mortgages, which are shown at contractual maturity but which may pre-pay earlier, and certain term deposits, which are shown at contractual maturity but which may be withdrawn before their contractual maturity subject to prepayment penalties. Investments are shown based on remaining contractual maturities. The remaining contractual principal maturities for mortgage-backed securities (primarily US government agencies) do not consider prepayments. Remaining expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations before the underlying mortgages mature. December 31, 2018 Earlier of contractual maturity or repricing date (in $ millions) Within 3 months 3 to 6 months 6 to 12 months 1 to 5 years After 5 years Non-interest bearing funds Total Assets Cash due from banks 1,930 — — — — 124 2,054 Securities purchased under agreement to resell 27 — — — — — 27 Short-term investments 40 10 — — — 2 52 Investments 488 35 8 245 3,473 6 4,255 Loans 3,160 278 38 223 330 15 4,044 Other assets — — — — — 341 341 Total assets 5,645 323 46 468 3,803 488 10,773 Liabilities and shareholders' equity Shareholders’ equity — — — — — 882 882 Demand deposits 5,357 — — — — 2,120 7,477 Term deposits 1,245 228 432 70 — — 1,975 Other liabilities — — — — — 296 296 Long-term debt 70 — — 73 — — 143 Total liabilities and shareholders' equity 6,672 228 432 143 — 3,298 10,773 Interest rate sensitivity gap (1,027 ) 95 (386 ) 325 3,803 (2,810 ) — Cumulative interest rate sensitivity gap (1,027 ) (932 ) (1,318 ) (993 ) 2,810 — — December 31, 2017 Earlier of contractual maturity or repricing date (in $ millions) Within 3 months 3 to 6 months 6 to 12 months 1 to 5 years After 5 years Non-interest bearing funds Total Assets Cash due from banks 1,446 — — — — 89 1,535 Securities purchased under agreement to resell 179 — — — — — 179 Short-term investments 163 87 — — — — 250 Investments 1,464 62 15 390 2,768 7 4,706 Loans 3,457 44 34 194 44 4 3,777 Other assets — — — — — 332 332 Total assets 6,709 193 49 584 2,812 432 10,779 Liabilities and shareholders' equity Shareholders’ equity — — — — — 823 823 Demand deposits 5,342 — — — — 2,480 7,822 Term deposits 1,340 132 183 59 — — 1,714 Other liabilities — — — — — 303 303 Long-term debt 92 25 — — — — 117 Total liabilities and shareholders' equity 6,774 157 183 59 — 3,606 10,779 Interest rate sensitivity gap (65 ) 36 (134 ) 525 2,812 (3,174 ) — Cumulative interest rate sensitivity gap (65 ) (29 ) (163 ) 362 3,174 — — |
Long-term debt (Tables)
Long-term debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of maturities of long-term debt | The following table presents the contractual maturity and interest payments for long-term debt issued by the Bank as at December 31, 2018 . The interest payments are calculated until contractual maturity using the current LIBOR rates. Interest payments until contractual maturity Long-term debt Earliest date redeemable at the Bank's option Contractual maturity date Interest rate until date redeemable Interest rate from earliest date redeemable to contractual maturity Principal Outstanding Within 1 year 1 to 5 years After 5 years Bermuda 2005 issuance - Series B July 2, 2015 July 2, 2020 5.11 % 3 months US$ LIBOR + 1.695% 45,000 2,054 1,542 — 2008 issuance - Series B May 27, 2018 May 27, 2023 8.44 % 3 months US$ LIBOR + 4.929% 25,000 1,961 6,861 — 2018 issuance June 1, 2023 June 1, 2028 5.25 % 3 months US$ LIBOR + 2.255% 75,000 3,938 15,711 17,340 Total 145,000 7,953 24,114 17,340 Unamortized debt issuance costs (1,678 ) Long-term debt less unamortized debt issuance costs 143,322 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | Year ended December 31, 2018 December 31, 2017 December 31, 2016 Net income 195,184 153,252 115,942 Less: Preference dividends declared and guarantee fee — — (15,655 ) Less: Premium on preference share buyback and redemption — — (41,913 ) Net income attributable for common shareholders 195,184 153,252 58,374 Basic Earnings Per Share Weighted average number of common shares issued 55,159 54,296 49,128 Weighted average number of common shares held as treasury stock (213 ) — (506 ) Weighted average number of common shares (in thousands) 54,946 54,296 48,622 Basic Earnings Per Share 3.55 2.82 1.20 Diluted Earnings Per Share Weighted average number of common shares 54,946 54,296 48,622 Net dilution impact related to options to purchase common shares 223 561 607 Net dilution impact related to awards of unvested common shares 576 594 382 Weighted average number of diluted common shares (in thousands) 55,745 55,451 49,611 Diluted Earnings Per Share 3.50 2.76 1.18 |
Share-based payments (Tables)
Share-based payments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of changes in outstanding stock options | Changes in Outstanding Stock Options Number of shares transferable upon exercise (thousands) Weighted average exercise price ($) Weighted average remaining life (years) Aggregate intrinsic value ($ thousands) Year ended December 31, 2018 1997 Stock Option Plan 2010 Stock Option Plan Total 1997 Stock Option Plan 2010 Stock Option Plan 1997 Stock Option Plan 2010 Stock Option Plan Outstanding at beginning of year 58 476 534 113.46 11.73 Exercised — (287 ) (287 ) — 11.56 10,172 Forfeitures and cancellations (33 ) — (33 ) 150.46 — Outstanding at end of year 25 189 214 64.51 11.98 0.20 1.67 3,665 Vested and exercisable at end of year 25 189 214 64.51 11.98 0.20 1.67 Number of shares transferable upon exercise (thousands) Weighted average exercise price ($) Weighted average remaining life (years) Aggregate intrinsic value ($ thousands) Year ended December 31, 2017 1997 Stock Option Plan 2010 Stock Option Plan Total 1997 Stock Option Plan 2010 Stock Option Plan 1997 Stock Option Plan 2010 Stock Option Plan Outstanding at beginning of year 116 1,950 2,066 132.13 11.57 Exercised — (1,474 ) (1,474 ) — 11.51 32,333 Forfeitures and cancellations (58 ) — (58 ) 151.20 — Outstanding at end of year 58 476 534 113.46 11.73 0.63 2.48 11,700 Vested and exercisable at end of year 58 476 534 113.46 11.73 0.63 2.48 Number of shares transferable upon exercise (thousands) Weighted average exercise price ($) Weighted average remaining life (years) Aggregate intrinsic value ($ thousands) Year ended December 31, 2016 1997 Stock Option Plan 2010 Stock Option Plan Total 1997 Stock Option Plan 2010 Stock Option Plan 1997 Stock Option Plan 2010 Stock Option Plan Outstanding at beginning of year 218 2,608 2,826 135.19 11.60 Exercised — (625 ) (625 ) — 11.68 8,938 Forfeitures and cancellations (102 ) (5 ) (107 ) 138.79 11.50 Resignations — (28 ) (28 ) — 11.50 Outstanding at end of year 116 1,950 2,066 132.13 11.57 1.18 3.42 38,489 Vested and exercisable at end of year 116 1,950 2,066 132.13 11.57 1.18 3.42 |
Schedule of changes in outstanding ELTIP and EDIP awards | Changes in Outstanding ELTIP and EDIP awards (in thousands of shares transferable upon vesting) Year ended December 31, 2018 December 31, 2017 December 31, 2016 EDIP ELTIP EDIP ELTIP EDIP ELTIP Outstanding at beginning of year 244 679 215 640 226 606 Granted 130 241 132 236 115 360 Vested (fair value in 2018: $16.0 million, 2017: $10.2 million, 2016: $7.0 million) (138 ) (220 ) (102 ) (196 ) (118 ) (302 ) Resignations (2 ) (3 ) (1 ) (1 ) (8 ) (24 ) Outstanding at end of year 234 697 244 679 215 640 |
Schedule of share-based compensation cost recognized in net income | Share-based Compensation Cost Recognized in Net Income Year ended December 31, 2018 December 31, 2017 December 31, 2016 Stock option plans EDIP and ELTIP Total Stock option plans EDIP and ELTIP Total Stock option plans EDIP and ELTIP Total Cost recognized in net income — 11,664 11,664 — 8,110 8,110 8,697 5,375 14,072 |
Schedule of unrecognized compensation cost | Unrecognized Share-based Compensation Cost December 31, 2018 December 31, 2017 Unrecognized cost Weighted average years over which it is expected to be recognized Unrecognized cost Weighted average years over which it is expected to be recognized EDIP 4,442 1.73 3,453 1.85 ELTIP Time vesting shares 1,746 1.03 3,302 1.89 Performance vesting shares 7,880 1.85 5,010 1.78 Total unrecognized expense 14,068 11,765 |
Share buy-back plans (Tables)
Share buy-back plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of share repurchase programmes | Year ended December 31 Common share buy-backs 2018 2017 2016 2015 2014 Total Acquired number of shares (to the nearest 1) 1,254,212 — 97,053 250,371 856,734 2,458,370 Average cost per common share 38.62 — 16.36 19.42 19.86 29.25 Total cost (in US dollars) 48,442,768 — 1,588,189 4,862,248 17,018,412 71,911,617 |
Accumulated other comprehensi_2
Accumulated other comprehensive loss (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of AOCL components | Unrealized (losses) HTM investments Unrealized Employee benefit plans December 31, 2018 Pension Post-retirement healthcare Subtotal - employee benefits plans Total AOCL Balance at beginning of year (17,549 ) (839 ) (15,737 ) (61,341 ) (33,586 ) (94,927 ) (129,052 ) Other comprehensive income (loss), net of taxes (2,317 ) 43 (27,893 ) (3,551 ) 14,243 10,692 (19,475 ) Balance at end of year (19,866 ) (796 ) (43,630 ) (64,892 ) (19,343 ) (84,235 ) (148,527 ) Unrealized (losses) HTM investments Unrealized Employee benefit plans December 31, 2017 Pension Post- retirement healthcare Subtotal - employee benefits plans Total AOCL Balance at beginning of year (20,152 ) (979 ) (22,680 ) (63,232 ) (37,637 ) (100,869 ) (144,680 ) Other comprehensive income (loss), net of taxes 2,603 140 6,943 1,891 4,051 5,942 15,628 Balance at end of year (17,549 ) (839 ) (15,737 ) (61,341 ) (33,586 ) (94,927 ) (129,052 ) Unrealized (losses) HTM investments Unrealized Employee benefit plans December 31, 2016 Pension Post- retirement healthcare Subtotal - employee benefits plans Total AOCL Balance at beginning of year (13,645 ) (2,350 ) (57 ) (46,331 ) (28,114 ) (74,445 ) (90,497 ) Transfer of AFS investments to HTM investments — 1,442 (1,442 ) — — — — Other comprehensive income (loss), net of taxes (6,507 ) (71 ) (21,181 ) (16,901 ) (9,523 ) (26,424 ) (54,183 ) Balance at end of year (20,152 ) (979 ) (22,680 ) (63,232 ) (37,637 ) (100,869 ) (144,680 ) |
Schedule of net change in AOCL components | Net Change of AOCL Components Year ended Line item in the consolidated statements of operations, if any December 31, 2018 December 31, 2017 December 31, 2016 Net unrealized gains (losses) on translation of net investment in foreign operations adjustments Foreign currency translation adjustments N/A (13,764 ) 12,568 (25,691 ) Gains (loss) on net investment hedge N/A 11,447 (9,965 ) 19,184 Net change (2,317 ) 2,603 (6,507 ) Held-to-maturity investment adjustments Net unamortized gains (losses) transferred from AFS N/A — — 1,442 Amortization of net gains (losses) to net income Interest income on investments 43 140 (71 ) Net change 43 140 1,371 Available-for-sale investment adjustments Gross unrealized gains (losses) N/A (26,793 ) 11,129 (19,635 ) Net unrealized (gains) losses transferred to HTM N/A — — (1,442 ) Transfer of realized (gains) losses to net income Net realized gains (losses) on AFS investments (1,100 ) (4,186 ) (1,546 ) Net change (27,893 ) 6,943 (22,623 ) Employee benefit plans adjustments Defined benefit pension plan Net actuarial gain (loss) N/A (7,541 ) 1,472 (19,956 ) Net loss (gain) on settlement reclassified to net income Net other gains (losses) 1,554 — — Prior service credit (cost) arising during the year N/A (212 ) — — Amortization of net actuarial (gains ) losses Non-service employee benefits expense 2,106 2,247 1,702 Change in deferred taxes N/A (298 ) (595 ) 1,315 Foreign currency translation adjustments of related balances N/A 840 (1,233 ) 38 Net change (3,551 ) 1,891 (16,901 ) Post-retirement healthcare plan Net actuarial gain (loss) N/A 11,589 1,296 (5,911 ) Amortization of net actuarial (gains ) losses Non-service employee benefits expense 2,615 3,514 2,731 Amortization of prior service (credi t) cost Non-service employee benefits expense 39 (759 ) (6,343 ) Net change 14,243 4,051 (9,523 ) Other comprehensive income (loss), net of taxes (19,475 ) 15,628 (54,183 ) |
Capital structure (Tables)
Capital structure (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Banking and Thrift [Abstract] | |
Schedule of compliance with regulatory capital requirements | The following table sets forth the Bank's capital adequacy in accordance with the Basel III framework: December 31, 2018 December 31, 2017 Actual Regulatory minimum Actual Regulatory minimum Capital CET 1 capital 846,043 N/A 772,311 N/A Tier 1 capital 846,043 N/A 772,311 N/A Tier 2 capital 121,521 N/A 74,010 N/A Total capital 967,564 N/A 846,321 N/A Risk Weighted Assets 4,321,354 N/A 4,254,178 N/A Leverage Ratio Exposure Measure 11,139,677 N/A 11,195,173 N/A Capital Ratios (%) CET 1 capital 19.6 % 9.4 % 18.2 % 8.8 % Tier 1 capital 19.6 % 10.9 % 18.2 % 10.3 % Total capital 22.4 % 15.6 % 19.9 % 14.9 % Leverage ratio 7.6 % 5.0 % 6.9 % 5.0 % |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of income taxes in consolidated statements of operations | Year ended Income taxes in consolidated statements of operations December 31, 2018 December 31, 2017 December 31, 2016 Current tax expense 721 856 727 Deferred tax expense 563 231 — Total tax expense 1,284 1,087 727 |
Schedule of reconciliation between the effective income tax rate and the statutory income tax rate | Reconciliation between the Effective Income Tax Rate and the Statutory Income Tax Rate Year ended December 31, 2018 December 31, 2017 December 31, 2016 $ % $ % $ % Income tax expense in international offices taxed at different rates 876 0.4 % 232 0.2 % (2,104 ) (1.8 )% Change in valuation allowance — — % 597 0.4 % 87 0.1 % Prior year tax adjustments (79 ) — % (55 ) — % (71 ) (0.1 )% Other - net 487 0.2 % 313 0.2 % 2,815 2.4 % Income tax expense (benefit) at effective tax rate 1,284 0.7 % 1,087 0.7 % 727 0.6 % |
Schedule of deferred income taxes | Deferred income taxes December 31, 2018 December 31, 2017 Deferred income tax asset Tax loss carried forward 6,261 6,868 Pension liability 789 1,152 Fixed assets (746 ) (223 ) Allowance for compensated absence 14 15 Deferred income tax asset before valuation allowance 6,318 7,812 Less: valuation allowance (5,955 ) (6,723 ) Net deferred income tax assets 363 1,089 Deferred income tax liability Other (5 ) — Net deferred income tax assets 358 1,089 |
Business combinations (Tables)
Business combinations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Schedule of total consideration transferred | The fair value of the net assets acquired and allocation of purchase is summarized as follows: As at April 29, 2016 Total consideration transferred 21,778 Assets acquired Intangible assets 21,443 Other assets 3,345 Total assets acquired 24,788 Liabilities acquired 3,010 Excess purchase price (goodwill) — The assets acquired consist mainly of: customer relationships intangible assets, goodwill and accounts receivable. The liabilities assumed consist mainly of deferred revenues and accounts payable. Goodwill is made up of expected cash flows to be derived from new business and expected synergies resulting from leveraging existing support services and infrastructure within the Bank. The goodwill acquisitions are allocated to reportable segments as per Note 9: Goodwill and other intangible assets. As at March 29, 2018 Total consideration transferred 24,680 Assets acquired Cash due from banks 3,958 Intangible assets (estimated useful life of 15 years) 16,932 Other assets 4,548 Total assets acquired 25,438 Liabilities acquired (included in Other liabilities on the balance sheet) 4,626 Excess purchase price (Goodwill) 3,868 |
Summary of unaudited pro forma financial information | The following selected unaudited pro forma financial information has been provided to present a summary of the combined results of the Bank and the acquired operations from HSBC Bermuda, assuming the transaction had been effected on January 1, 2015. The unaudited pro forma data is for informational purposes only and does not necessarily represent results that would have occurred if the transaction had taken place on the basis assumed above. The pro forma have been prepared based on the actual results realized by the Bank from operating the acquired activities, when such activities were not yet inextricably merged into the Bank's operations. Year ended Unaudited pro forma financial information December 31, 2016 Total net revenue 407,453 Total non-interest operating expense 289,019 Pro forma net income post business combination 118,434 |
Condensed financial statement_2
Condensed financial statements of the parent company only (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Balance Sheet | The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Balance Sheets (In thousands of US dollars) As at December 31, 2018 December 31, 2017 Assets Cash and demand deposits with banks - Non-interest-bearing 21,677 23,774 Demand deposits with banks - Interest-bearing 316,872 192,099 Cash equivalents - Interest-bearing 364,714 389,120 Cash due from banks 703,263 604,993 Securities purchased under agreement to resell 27,341 178,769 Short-term investments 13,736 109,322 Investment in securities Trading 6,495 6,824 Available-for-sale 1,345,408 2,234,979 Held-to-maturity (fair value: $1,076,979 (2017: $695,758)) 1,088,564 697,531 Total investment in securities 2,440,467 2,939,334 Net assets of subsidiaries - Banks 415,227 373,576 Net assets of subsidiaries - Non-banks 24,195 2,543 Loans to third parties, net of allowance for credit losses 1,949,701 1,960,103 Loans to subsidiaries - Banks 12,754 13,517 Loans to subsidiaries - Non-banks 56,020 57,833 Accrued interest 12,824 12,149 Other assets, including premises, equipment and computer software, equity method investments, receivables from subsidiaries and other real estate owned 203,599 203,518 Total assets 5,859,127 6,455,657 Liabilities Customer deposits Non-interest bearing 1,378,539 1,840,201 Interest bearing 3,117,063 3,412,622 Total customer deposits 4,495,602 5,252,823 Bank deposits 154,101 12,252 Total deposits 4,649,703 5,265,075 Employee benefit plans 117,203 127,687 Accrued interest 2,908 1,171 Pending payable for investments purchased — 51,913 Other liabilities, including payables to subsidiaries 63,648 69,930 Total other liabilities 183,759 250,701 Long-term debt 143,322 117,000 Total liabilities 4,976,784 5,632,776 Total shareholders’ equity 882,343 822,881 Total liabilities and shareholders’ equity 5,859,127 6,455,657 |
Condensed Income Statement | The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Statements of Operations (In thousands of US dollars) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Non-interest income Banking 23,506 22,836 21,984 Foreign exchange revenue 11,727 11,623 11,174 Other non-interest income 6,330 4,570 3,516 Dividends from subsidiaries - Banks 60,000 50,000 40,000 Dividends from subsidiaries - Non-banks 19,095 16,060 6,600 Total non-interest income 120,658 105,089 83,274 Interest income Loans 133,124 118,092 123,370 Investments 73,698 61,928 44,745 Deposits with banks 12,932 10,661 6,293 Total interest income 219,754 190,681 174,408 Interest expense Deposits 6,709 5,011 6,882 Long-term debt 6,949 4,955 4,500 Securities sold under repurchase agreements 33 — 118 Total interest expense 13,691 9,966 11,500 Net interest income before provision for credit losses 206,063 180,715 162,908 Provision for credit gains (losses) 6,823 4,618 (7,263 ) Net interest income after provision for credit losses 212,886 185,333 155,645 Net trading gains (losses) (329 ) 511 330 Net realized gains (losses) on available-for-sale investments 758 4,241 1,222 Net gains (losses) on other real estate owned (323 ) (2,416 ) (287 ) Net other gains (losses) — 258 (325 ) Total other gains (losses) 106 2,594 940 Total net revenue 333,650 293,016 239,859 Non-interest expense Salaries and other employee benefits 75,949 72,440 68,712 Technology and communications 36,466 33,051 34,033 Professional and outside services 22,696 20,685 9,379 Property 6,693 6,438 5,983 Indirect taxes 14,669 12,900 10,562 Marketing 3,034 3,384 2,138 Non-service employee benefits expense 6,427 7,854 1,058 Amortization of intangible assets 169 169 113 Restructuring costs — — 117 Other expenses 4,230 4,351 5,373 Total non-interest expense 170,333 161,272 137,468 Net income before equity in undistributed earnings of subsidiaries 163,317 131,744 102,391 Equity in undistributed earnings of subsidiaries 31,867 21,508 13,551 Net income 195,184 153,252 115,942 Other comprehensive income, net of tax (19,475 ) 15,628 (54,183 ) Total comprehensive income 175,709 168,880 61,759 |
Condensed Cash Flow Statement | The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Statements of Cash Flows (In thousands of US dollars) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Cash flows from operating activities Net income 195,184 153,252 115,942 Adjustments to reconcile net income to operating cash flows Depreciation and amortization 21,425 23,982 23,687 (Increase) decrease in carrying value of equity method investments (1,033 ) (1,152 ) (949 ) Share-based payments and settlements 12,582 8,410 14,423 Equity in undistributed earnings of subsidiaries (31,867 ) (21,508 ) (13,551 ) Net realized / unrealized (gains) losses on other real estate owned 323 2,416 287 Net realized (gains) losses on available-for-sale investments (758 ) (4,241 ) (1,222 ) Dividends received from equity method investment 376 307 319 Provision for credit losses (6,823 ) (4,618 ) 7,263 Changes in operating assets and liabilities (Increase) decrease in accrued interest receivable (755 ) 2,886 (1,163 ) (Increase) decrease in other assets (11,160 ) 12,167 (20,312 ) Increase (decrease) in accrued interest payable 1,737 (519 ) 160 Increase (decrease) in other liabilities and employee benefit plans (2,523 ) 22,282 10,388 Cash provided by (used in) operating activities 176,708 193,664 135,272 Cash flows from investing activities (Increase) decrease in securities purchased under agreement to resell 151,428 (29,956 ) (148,813 ) Net (increase) decrease in short-term investments other than restricted cash 87,268 342,585 (330,144 ) Net change in trading investments 329 (511 ) (146 ) Available-for-sale investments: proceeds from sale 681,656 205,257 25,489 Available-for-sale investments: proceeds from maturities and pay downs 340,114 324,907 341,835 Available-for-sale investments: purchases (156,271 ) (595,526 ) (1,332,836 ) Held-to-maturity investments: proceeds from maturities and pay downs 82,853 59,424 38,430 Held-to-maturity investments: purchases (525,637 ) (199,145 ) (124,325 ) Net (increase) decrease in loans to third parties 15,184 (46,391 ) 177,823 Net (increase) decrease in loans to bank subsidiaries 764 40,689 10,608 Net (increase) decrease in loans to non-bank subsidiaries 1,812 (2,713 ) 5,172 Additions to premises, equipment and computer software (9,830 ) (14,777 ) (5,700 ) Proceeds from sale of other real estate owned 5,896 1,795 3,061 Injection of capital in subsidiary (64,029 ) (12,802 ) (6,945 ) Return of capital from a subsidiary 8,244 12,376 — Cash disbursed for business acquisition — — (2,540 ) Cash provided by (used in) investing activities 619,781 85,212 (1,349,031 ) The Bank of N.T. Butterfield & Son Limited (parent company only) Condensed Statements of Cash Flows (In thousands of US dollars) Year ended December 31, 2018 December 31, 2017 December 31, 2016 Cash flows from financing activities Net (increase) decrease in demand and term deposit liabilities (603,925 ) (811,322 ) 1,696,948 Issuance of subordinated capital 73,218 — — Repayment of long-term debt (47,000 ) — — Proceeds from issuance of common shares, net of underwriting discounts and commissions — 13 131,600 Cost of issuance of common shares — — (5,458 ) Proceeds from loans sold under agreement to repurchase — — 5,152 Cost of repurchase of loans under agreement to repurchase — — (5,152 ) Common shares repurchased (48,443 ) — (1,633 ) Preference shares repurchased — — (212,121 ) Warrant repurchase — — (100 ) Proceeds from stock option exercises 3,318 4,546 6,919 Cash dividends paid on common and contingent value convertible preference shares (83,704 ) (69,731 ) (19,346 ) Cash dividends paid on preference shares — — (14,629 ) Preference shares guarantee fee paid — — (1,676 ) Cash provided by (used in) financing activities (706,536 ) (876,494 ) 1,580,504 Net increase (decrease) in cash, cash equivalent and restricted cash 89,953 (597,618 ) 366,745 Cash, cash equivalent and restricted cash: beginning of year 627,046 1,224,664 857,919 Cash, cash equivalent and restricted cash: end of year 716,999 627,046 1,224,664 Components of cash, cash equivalent and restricted cash at end of year Cash due from banks 703,263 604,993 1,206,770 Restricted cash included in short-term investments on the Consolidated Balance Sheets 13,736 22,053 17,894 Total cash, cash equivalent and restricted cash at end of year 716,999 627,046 1,224,664 Supplemental disclosure of cash flow information Cash interest paid 15,428 9,447 11,660 Non-cash item Transfer to other real estate owned 2,041 — 8,961 |
Nature of business (Details)
Nature of business (Details) $ / shares in Units, $ in Millions | Sep. 21, 2016USD ($)$ / sharesshares | Dec. 31, 2018segmentshares | Dec. 31, 2017segmentshares | Dec. 31, 2016shares |
Class of Stock [Line Items] | ||||
Number of operating segments | segment | 3 | 6 | ||
Proceeds from issuance initial public offering | $ | $ 131.6 | |||
Common Stock | ||||
Class of Stock [Line Items] | ||||
Issuance of common shares in initial public offering (in shares) | shares | 5,957,447 | 666,588 | 1,407,758 | 5,994,012 |
Share price (in dollars per share) | $ / shares | $ 23.50 |
Significant accounting polici_3
Significant accounting policies (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Jan. 01, 2019 | |
Accounting Policies [Abstract] | ||
Number of contractual days past due after which credit card consumer loans are generally written off | 180 days | |
Outstanding balance threshold under which consumer loans are generally written off | $ 100,000 | |
Number of contractual days past due after which consumer loans under $100,000 are generally written off | 180 days | |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 50 years | |
Equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 3 years | |
Equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 10 years | |
Software and Software Development Costs | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 5 years | |
Software and Software Development Costs | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 10 years | |
Other Intangible Assets | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 15 years | |
ASU 2016-02 and ASU 2018-11 | Scenario, Forecast | ||
Property, Plant and Equipment [Line Items] | ||
Operating lease, right-of-use asset | $ 23,000,000 | |
Operating lease, right-of-use liability | $ 23,000,000 |
Cash due from banks (Details)
Cash due from banks (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Non-interest bearing | ||
Cash and demand deposits with banks | $ 124,182 | $ 89,381 |
Interest bearing | ||
Demand deposits with banks | 487,588 | 340,256 |
Cash equivalents - Interest bearing | 1,442,113 | 1,105,501 |
Sub-total - Interest bearing | 1,929,701 | 1,445,757 |
Cash due from banks | 2,053,883 | 1,535,138 |
Interest-bearing deposits in banks bearing negligible interest | 204,200 | 203,300 |
Bermuda | ||
Non-interest bearing | ||
Cash and demand deposits with banks | 21,677 | 24,189 |
Interest bearing | ||
Demand deposits with banks | 335,841 | 215,363 |
Cash equivalents - Interest bearing | 364,714 | 330,247 |
Sub-total - Interest bearing | 700,555 | 545,610 |
Cash due from banks | 722,232 | 569,799 |
Non-Bermuda | ||
Non-interest bearing | ||
Cash and demand deposits with banks | 102,505 | 65,192 |
Interest bearing | ||
Demand deposits with banks | 151,747 | 124,893 |
Cash equivalents - Interest bearing | 1,077,399 | 775,254 |
Sub-total - Interest bearing | 1,229,146 | 900,147 |
Cash due from banks | $ 1,331,651 | $ 965,339 |
Short-term investments (Details
Short-term investments (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investment [Line Items] | ||
Short-term investments | $ 52,336 | $ 249,984 |
Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 13,836 | 109,422 |
Non-Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 38,500 | 140,562 |
Unrestricted | ||
Investment [Line Items] | ||
Short-term investments | 35,100 | 226,390 |
Unrestricted | Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 0 | 87,369 |
Unrestricted | Non-Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 35,100 | 139,021 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | ||
Investment [Line Items] | ||
Short-term investments | 17,236 | 23,594 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Non-Interest-Bearing Deposits | ||
Investment [Line Items] | ||
Short-term investments | 2,401 | 0 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Interest-bearing Deposits | ||
Investment [Line Items] | ||
Short-term investments | 14,835 | 23,594 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 13,836 | 22,053 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Bermuda | Non-Interest-Bearing Deposits | ||
Investment [Line Items] | ||
Short-term investments | 0 | 0 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Bermuda | Interest-bearing Deposits | ||
Investment [Line Items] | ||
Short-term investments | 13,836 | 22,053 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Non-Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 3,400 | 1,541 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Non-Bermuda | Non-Interest-Bearing Deposits | ||
Investment [Line Items] | ||
Short-term investments | 2,401 | 0 |
Affected by drawing restrictions related to minimum reserve and derivative margin requirements | Non-Bermuda | Interest-bearing Deposits | ||
Investment [Line Items] | ||
Short-term investments | 999 | 1,541 |
Maturing within three months | Unrestricted | ||
Investment [Line Items] | ||
Short-term investments | 25,459 | 139,514 |
Maturing within three months | Unrestricted | Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 0 | 67,528 |
Maturing within three months | Unrestricted | Non-Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 25,459 | 71,986 |
Maturing between three to six months | Unrestricted | ||
Investment [Line Items] | ||
Short-term investments | 9,641 | 86,876 |
Maturing between three to six months | Unrestricted | Bermuda | ||
Investment [Line Items] | ||
Short-term investments | 0 | 19,841 |
Maturing between three to six months | Unrestricted | Non-Bermuda | ||
Investment [Line Items] | ||
Short-term investments | $ 9,641 | $ 67,035 |
Investment in securities - Amor
Investment in securities - Amortized Cost, Carrying Amount and Fair Value (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Trading | |||
Trading, Amortized cost | $ 5,724,000 | $ 5,724,000 | |
Trading, Gross unrealized gains | 1,176,000 | 1,616,000 | |
Trading, Gross unrealized losses | (405,000) | (516,000) | |
Trading, Fair value | 6,495,000 | 6,824,000 | |
Available-for-sale | |||
Available-for-sale, Amortized cost | 2,226,377,000 | 3,333,175,000 | |
Available-for-sale, Gross unrealized gains | 3,380,000 | 9,560,000 | |
Available-for-sale, Gross unrealized losses | (47,008,000) | (25,295,000) | |
Available-for-sale, Fair value | 2,182,749,000 | 3,317,440,000 | |
Held-to-maturity | |||
Held-to-maturity, Amortized cost | 2,066,120,000 | 1,381,955,000 | |
Held-to-maturity, Gross unrealized gains | 5,012,000 | 4,813,000 | |
Held-to-maturity, Gross unrealized losses | (34,918,000) | (9,414,000) | |
Held-to-maturity, fair value | 2,036,214,000 | 1,377,354,000 | |
Non-credit impairments recognized in accumulated other comprehensive loss, held-to-maturity investments | 0 | 0 | $ 0 |
Mutual funds | |||
Trading | |||
Trading, Amortized cost | 5,724,000 | 5,724,000 | |
Trading, Gross unrealized gains | 1,176,000 | 1,616,000 | |
Trading, Gross unrealized losses | (405,000) | (516,000) | |
Trading, Fair value | 6,495,000 | 6,824,000 | |
US government and federal agencies | |||
Available-for-sale | |||
Available-for-sale, Amortized cost | 1,820,808,000 | 2,720,581,000 | |
Available-for-sale, Gross unrealized gains | 3,355,000 | 8,924,000 | |
Available-for-sale, Gross unrealized losses | (37,656,000) | (20,401,000) | |
Available-for-sale, Fair value | 1,786,507,000 | 2,709,104,000 | |
Held-to-maturity | |||
Held-to-maturity, Amortized cost | 2,066,120,000 | 1,381,955,000 | |
Held-to-maturity, Gross unrealized gains | 5,012,000 | 4,813,000 | |
Held-to-maturity, Gross unrealized losses | (34,918,000) | (9,414,000) | |
Held-to-maturity, fair value | 2,036,214,000 | 1,377,354,000 | |
Non-US governments debt securities | |||
Available-for-sale | |||
Available-for-sale, Amortized cost | 25,804,000 | 26,516,000 | |
Available-for-sale, Gross unrealized gains | 19,000 | 118,000 | |
Available-for-sale, Gross unrealized losses | (398,000) | (386,000) | |
Available-for-sale, Fair value | 25,425,000 | 26,248,000 | |
Corporate debt securities | |||
Available-for-sale | |||
Available-for-sale, Amortized cost | 80,177,000 | 243,999,000 | |
Available-for-sale, Gross unrealized gains | 0 | 153,000 | |
Available-for-sale, Gross unrealized losses | (1,464,000) | (780,000) | |
Available-for-sale, Fair value | 78,713,000 | 243,372,000 | |
Asset-backed securities - Student loans | |||
Available-for-sale | |||
Available-for-sale, Amortized cost | 13,290,000 | 13,290,000 | |
Available-for-sale, Gross unrealized gains | 0 | 0 | |
Available-for-sale, Gross unrealized losses | (664,000) | (797,000) | |
Available-for-sale, Fair value | 12,626,000 | 12,493,000 | |
Commercial mortgage-backed securities | |||
Available-for-sale | |||
Available-for-sale, Amortized cost | 125,806,000 | 142,740,000 | |
Available-for-sale, Gross unrealized gains | 6,000 | 56,000 | |
Available-for-sale, Gross unrealized losses | (2,603,000) | (1,296,000) | |
Available-for-sale, Fair value | 123,209,000 | 141,500,000 | |
Residential mortgage-backed securities | |||
Available-for-sale | |||
Available-for-sale, Amortized cost | 160,492,000 | 186,049,000 | |
Available-for-sale, Gross unrealized gains | 0 | 309,000 | |
Available-for-sale, Gross unrealized losses | (4,223,000) | (1,635,000) | |
Available-for-sale, Fair value | $ 156,269,000 | $ 184,723,000 |
Investment in securities - Narr
Investment in securities - Narrative (Details) | Dec. 31, 2018security | Dec. 31, 2017security |
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, qualitative disclosure, number of positions | 198 | 161 |
Available-for-sale and held-to-maturity, securities in unrealized loss positions, percentage of portfolio fair value | 75.00% | 59.00% |
Available-for-sale and held-to-maturity, securities in unrealized loss positions, qualitative disclosure, percentage of fair value of affected securities | 2.60% | 1.30% |
Standard & Poor's, A Minus To A Plus Rating | Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, qualitative disclosure, number of positions | 6 | |
Standard & Poor's, AAA To AA Plus Rating | Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, qualitative disclosure, number of positions | 11 | 8 |
Standard & Poor's, AAA To AA Plus Rating | Commercial mortgage-backed securities | Minimum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, weighted average credit support | 0.25 | |
Available-for-sale, securities in unrealized loss positions, loan-to-value ratio | 0.38 | |
Standard & Poor's, AAA To AA Plus Rating | Commercial mortgage-backed securities | Maximum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, weighted average credit support | 0.46 | |
Available-for-sale, securities in unrealized loss positions, loan-to-value ratio | 0.72 | |
Standard & Poor's, AAA To AA Plus Rating | Residential mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, qualitative disclosure, number of positions | 17 | |
Standard & Poor's, AAA To AA Plus Rating | Residential mortgage-backed securities | Minimum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, weighted average credit support | 0.06 | |
Available-for-sale, securities in unrealized loss positions, loan-to-value ratio | 0.21 | |
Standard & Poor's, AAA To AA Plus Rating | Residential mortgage-backed securities | Maximum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, weighted average credit support | 0.53 | |
Available-for-sale, securities in unrealized loss positions, loan-to-value ratio | 0.65 | |
No Explicit Credit Support | Commercial mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, qualitative disclosure, number of positions | 3 | |
Available-for-sale, securities in unrealized loss positions, qualitative disclosure, number of defeased positions | 2 | |
No Explicit Credit Support | Commercial mortgage-backed securities | Maximum | ||
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale, securities in unrealized loss positions, loan-to-value ratio | 0.30 |
Investment in securities - Cont
Investment in securities - Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | $ 437,813 | $ 714,400 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | (3,013) | (3,881) |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 1,350,267 | 1,221,471 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (43,995) | (21,414) |
Available-for-sale securities with unrealized losses, Total fair value | 1,788,080 | 1,935,871 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | (47,008) | (25,295) |
Held-to-maturity securities with unrealized losses, Less than 12 months, Fair Value | 647,484 | 549,532 |
Held-to-maturity securities with unrealized losses, Less than 12 months, Gross unrealized losses | (11,468) | (2,862) |
Held-to-maturity securities with unrealized losses, 12 months or more, Fair value | 724,974 | 288,830 |
Held-to-maturity securities with unrealized losses, 12 months or more, Gross unrealized losses | (23,450) | (6,552) |
Held-to-maturity securities with unrealized losses, Total fair value | 1,372,458 | 838,362 |
Held-to-maturity securities with unrealized losses, Total gross unrealized losses | (34,918) | (9,414) |
US government and federal agencies | ||
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | 372,283 | 467,958 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | (1,586) | (2,461) |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 1,027,638 | 1,043,601 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (36,070) | (17,940) |
Available-for-sale securities with unrealized losses, Total fair value | 1,399,921 | 1,511,559 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | (37,656) | (20,401) |
Non-US governments debt securities | ||
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | 0 | 0 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | 0 | 0 |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 22,360 | 22,360 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (398) | (386) |
Available-for-sale securities with unrealized losses, Total fair value | 22,360 | 22,360 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | (398) | (386) |
Corporate debt securities | ||
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | 14,914 | 76,016 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | (114) | (225) |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 63,799 | 49,964 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (1,350) | (555) |
Available-for-sale securities with unrealized losses, Total fair value | 78,713 | 125,980 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | (1,464) | (780) |
Asset-backed securities - Student loans | ||
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | 0 | 0 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | 0 | 0 |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 12,626 | 12,493 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (664) | (797) |
Available-for-sale securities with unrealized losses, Total fair value | 12,626 | 12,493 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | (664) | (797) |
Commercial mortgage-backed securities | ||
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | 812 | 98,822 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | 0 | (709) |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 117,379 | 36,766 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (2,603) | (587) |
Available-for-sale securities with unrealized losses, Total fair value | 118,191 | 135,588 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | (2,603) | (1,296) |
Residential mortgage-backed securities | ||
Schedule Of Marketable Securities [Line Items] | ||
Available-for-sale securities with unrealized losses, Less than 12 months, Fair value | 49,804 | 71,604 |
Available-for-sale securities with unrealized losses, Less than 12 months, Gross unrealized losses | (1,313) | (486) |
Available-for-sale securities with unrealized losses,12 months or more, Fair value | 106,465 | 56,287 |
Available-for-sale securities with unrealized losses,12 months or more, Gross unrealized losses | (2,910) | (1,149) |
Available-for-sale securities with unrealized losses, Total fair value | 156,269 | 127,891 |
Available-for-sale securities with unrealized losses, Total gross unrealized losses | $ (4,223) | $ (1,635) |
Investment in securities - Inve
Investment in securities - Investment Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Available-for-sale | ||
Within 3 months | $ 0 | |
3 to 12 months | 17,988 | |
1 to 5 years | 120,573 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 2,044,188 | |
Carrying amount | 2,182,749 | $ 3,317,440 |
Trading, Available-for-sale and Held-to-maturity Securities | ||
Within 3 months | 0 | |
3 to 12 months | 17,988 | |
1 to 5 years | 120,573 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 4,116,803 | |
Carrying amount | 4,255,364 | |
US dollars | ||
Trading, Available-for-sale and Held-to-maturity Securities | ||
Within 3 months | 0 | |
3 to 12 months | 17,988 | |
1 to 5 years | 120,573 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 4,116,484 | |
Carrying amount | 4,255,045 | |
Other | ||
Trading, Available-for-sale and Held-to-maturity Securities | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 0 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 319 | |
Carrying amount | 319 | |
Mutual funds | ||
Trading | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 0 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 6,495 | |
Carrying amount | 6,495 | |
US government and federal agencies | ||
Available-for-sale | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 34,423 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 1,752,084 | |
Carrying amount | 1,786,507 | 2,709,104 |
Held-to-maturity | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 0 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 2,066,120 | |
Carrying amount | 2,066,120 | |
Non-US governments debt securities | ||
Available-for-sale | ||
Within 3 months | 0 | |
3 to 12 months | 3,064 | |
1 to 5 years | 22,361 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 0 | |
Carrying amount | 25,425 | 26,248 |
Corporate debt securities | ||
Available-for-sale | ||
Within 3 months | 0 | |
3 to 12 months | 14,924 | |
1 to 5 years | 63,789 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 0 | |
Carrying amount | 78,713 | 243,372 |
Asset-backed securities - Student loans | ||
Available-for-sale | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 0 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 12,626 | |
Carrying amount | 12,626 | 12,493 |
Commercial mortgage-backed securities | ||
Available-for-sale | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 0 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 123,209 | |
Carrying amount | 123,209 | 141,500 |
Residential mortgage-backed securities | ||
Available-for-sale | ||
Within 3 months | 0 | |
3 to 12 months | 0 | |
1 to 5 years | 0 | |
5 to 10 years | 0 | |
Over 10 years | 0 | |
No specific or single maturity | 156,269 | |
Carrying amount | $ 156,269 | $ 184,723 |
Investment in securities - Pled
Investment in securities - Pledged Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Investments, Debt and Equity Securities [Abstract] | ||
Available-for-sale, Amortized cost | $ 42,531 | $ 149,999 |
Available-for-sale, Fair value | 42,400 | 150,900 |
Held-to-maturity, Amortized cost | 70,818 | 202,303 |
Held-to-maturity, Fair value | $ 69,030 | $ 201,523 |
Investment in securities - Sale
Investment in securities - Sale Proceeds and Realized Gains and Losses of AFS Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Securities, Available-for-sale [Line Items] | |||
Sale proceeds | $ 854,160 | $ 213,047 | $ 60,548 |
Gross realized gains | 2,804 | 4,246 | 1,622 |
Gross realized (losses) | (1,704) | (60) | (76) |
US government and federal agencies | |||
Debt Securities, Available-for-sale [Line Items] | |||
Sale proceeds | 812,720 | 59,939 | |
Gross realized gains | 1,599 | 1,013 | |
Gross realized (losses) | (1,263) | (76) | |
Corporate debt securities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Sale proceeds | 24,975 | 202,700 | |
Gross realized gains | 0 | 1,684 | |
Gross realized (losses) | (87) | 0 | |
Commercial mortgage-backed securities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Sale proceeds | 15,260 | 7,785 | |
Gross realized gains | 0 | 0 | |
Gross realized (losses) | (354) | (60) | |
Pass-through note | |||
Debt Securities, Available-for-sale [Line Items] | |||
Sale proceeds | 1,205 | 2,562 | 609 |
Gross realized gains | 1,205 | 2,562 | 609 |
Gross realized (losses) | $ 0 | $ 0 | $ 0 |
Loans - Schedule of Loans (Deta
Loans - Schedule of Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Receivables [Abstract] | |||
Effective yield | 5.53% | 5.09% | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | $ 4,068,991 | $ 3,812,329 | |
Less specific allowance for credit losses | (25,102) | (35,467) | |
Loans, net of allowance for credit losses | 4,043,889 | 3,776,862 | |
Less specific allowance for credit losses | (14,915) | (13,624) | $ (11,738) |
Less general allowance for credit losses | (10,187) | (21,843) | (32,509) |
Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 1,969,014 | 1,988,813 | |
Loans, net of allowance for credit losses | 1,949,701 | 1,960,103 | |
Less specific allowance for credit losses | (12,215) | (12,371) | |
Less general allowance for credit losses | (7,098) | (16,339) | |
Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 2,099,977 | 1,823,516 | |
Loans, net of allowance for credit losses | 2,094,188 | 1,816,759 | |
Less specific allowance for credit losses | (2,700) | (1,253) | |
Less general allowance for credit losses | (3,089) | (5,504) | |
Commercial loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 652,621 | 545,876 | |
Less specific allowance for credit losses | (4,453) | (2,866) | |
Loans, net of allowance for credit losses | 648,168 | 543,010 | |
Less specific allowance for credit losses | (4,453) | (2,866) | (577) |
Less general allowance for credit losses | (2,460) | (3,443) | (2,800) |
Commercial loans | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 400,806 | 355,887 | |
Less specific allowance for credit losses | (2,766) | (2,866) | |
Loans, net of allowance for credit losses | 398,040 | 353,021 | |
Commercial loans | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 251,815 | 189,989 | |
Less specific allowance for credit losses | (1,687) | 0 | |
Loans, net of allowance for credit losses | 250,128 | 189,989 | |
Commercial loans | Overdrafts | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 33,094 | 21,523 | |
Commercial loans | Overdrafts | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 16,342 | 18,649 | |
Commercial loans | Overdrafts | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 16,752 | 2,874 | |
Commercial loans | Governments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 105,664 | 153,401 | |
Commercial loans | Governments | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 92,994 | 139,987 | |
Commercial loans | Governments | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 12,670 | 13,414 | |
Commercial loans | Commercial and industrial | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 513,863 | 370,952 | |
Commercial loans | Commercial and industrial | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 291,470 | 197,251 | |
Commercial loans | Commercial and industrial | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 222,393 | 173,701 | |
Commercial real estate loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 575,644 | 584,078 | |
Less specific allowance for credit losses | (600) | (583) | |
Loans, net of allowance for credit losses | 575,044 | 583,495 | |
Less specific allowance for credit losses | (600) | (583) | (750) |
Less general allowance for credit losses | (3,492) | (9,777) | (15,474) |
Commercial real estate loans | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 334,279 | 370,594 | |
Less specific allowance for credit losses | (600) | (550) | |
Loans, net of allowance for credit losses | 333,679 | 370,044 | |
Commercial real estate loans | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 241,365 | 213,484 | |
Less specific allowance for credit losses | 0 | (33) | |
Loans, net of allowance for credit losses | 241,365 | 213,451 | |
Commercial real estate loans | Commercial mortgage | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 496,975 | 535,835 | |
Commercial real estate loans | Commercial mortgage | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 304,519 | 346,094 | |
Commercial real estate loans | Commercial mortgage | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 192,456 | 189,741 | |
Commercial real estate loans | Construction | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 78,669 | 48,243 | |
Commercial real estate loans | Construction | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 29,760 | 24,500 | |
Commercial real estate loans | Construction | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 48,909 | 23,743 | |
Consumer loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 180,690 | 187,675 | |
Less specific allowance for credit losses | (274) | (274) | |
Loans, net of allowance for credit losses | 180,416 | 187,401 | |
Less specific allowance for credit losses | (274) | (274) | (278) |
Less general allowance for credit losses | (528) | (614) | (687) |
Consumer loans | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 112,641 | 106,198 | |
Less specific allowance for credit losses | (274) | (274) | |
Loans, net of allowance for credit losses | 112,367 | 105,924 | |
Consumer loans | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 68,049 | 81,477 | |
Less specific allowance for credit losses | 0 | 0 | |
Loans, net of allowance for credit losses | 68,049 | 81,477 | |
Consumer loans | Overdrafts | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 12,886 | 8,361 | |
Consumer loans | Overdrafts | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 10,511 | 5,490 | |
Consumer loans | Overdrafts | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 2,375 | 2,871 | |
Consumer loans | Automobile financing | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 20,224 | 19,295 | |
Consumer loans | Automobile financing | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 13,249 | 13,113 | |
Consumer loans | Automobile financing | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 6,975 | 6,182 | |
Consumer loans | Credit card | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 84,089 | 79,005 | |
Consumer loans | Credit card | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 60,466 | 57,777 | |
Consumer loans | Credit card | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 23,623 | 21,228 | |
Consumer loans | Other consumer | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 63,491 | 81,014 | |
Consumer loans | Other consumer | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 28,415 | 29,818 | |
Consumer loans | Other consumer | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 35,076 | 51,196 | |
Residential mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 2,660,036 | 2,494,700 | |
Less specific allowance for credit losses | (9,588) | (9,901) | |
Loans, net of allowance for credit losses | 2,650,448 | 2,484,799 | |
Less specific allowance for credit losses | (9,588) | (9,901) | (10,133) |
Less general allowance for credit losses | (3,707) | (8,009) | $ (13,548) |
Residential mortgage loans | Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 1,121,288 | 1,156,134 | |
Less specific allowance for credit losses | (8,575) | (8,681) | |
Loans, net of allowance for credit losses | 1,112,713 | 1,147,453 | |
Residential mortgage loans | Non-Bermuda | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans, gross | 1,538,748 | 1,338,566 | |
Less specific allowance for credit losses | (1,013) | (1,220) | |
Loans, net of allowance for credit losses | $ 1,537,735 | $ 1,337,346 |
Loans - Age Analysis of Past Du
Loans - Age Analysis of Past Due Loans (Including Non-Accrual Loans) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | $ 96,137 | $ 81,166 |
Total current | 3,972,854 | 3,731,163 |
Total loans | 4,068,991 | 3,812,329 |
30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 33,015 | 20,739 |
60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 10,666 | 11,665 |
More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 52,456 | 48,762 |
Commercial loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 11,362 | 8,487 |
Total current | 641,259 | 537,389 |
Total loans | 652,621 | 545,876 |
Commercial loans | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 231 | 0 |
Commercial loans | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 1,005 |
Commercial loans | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 11,131 | 7,482 |
Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 2 | 1 |
Total current | 33,092 | 21,522 |
Total loans | 33,094 | 21,523 |
Commercial loans | Overdrafts | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Commercial loans | Overdrafts | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Commercial loans | Overdrafts | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 2 | 1 |
Commercial loans | Governments | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 3,750 | 0 |
Total current | 101,914 | 153,401 |
Total loans | 105,664 | 153,401 |
Commercial loans | Governments | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Commercial loans | Governments | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Commercial loans | Governments | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 3,750 | 0 |
Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 7,610 | 8,486 |
Total current | 506,253 | 362,466 |
Total loans | 513,863 | 370,952 |
Commercial loans | Commercial and industrial | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 231 | 0 |
Commercial loans | Commercial and industrial | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 1,005 |
Commercial loans | Commercial and industrial | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 7,379 | 7,481 |
Commercial real estate loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 6,181 | 5,173 |
Total current | 569,463 | 578,905 |
Total loans | 575,644 | 584,078 |
Commercial real estate loans | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 837 | 392 |
Commercial real estate loans | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 1,282 | 0 |
Commercial real estate loans | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 4,062 | 4,781 |
Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 6,181 | 5,173 |
Total current | 490,794 | 530,662 |
Total loans | 496,975 | 535,835 |
Commercial real estate loans | Commercial mortgage | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 837 | 392 |
Commercial real estate loans | Commercial mortgage | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 1,282 | 0 |
Commercial real estate loans | Commercial mortgage | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 4,062 | 4,781 |
Commercial real estate loans | Construction | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Total current | 78,669 | 48,243 |
Total loans | 78,669 | 48,243 |
Commercial real estate loans | Construction | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Commercial real estate loans | Construction | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Commercial real estate loans | Construction | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Consumer loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 2,326 | 2,585 |
Total current | 178,364 | 185,090 |
Total loans | 180,690 | 187,675 |
Consumer loans | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 932 | 1,226 |
Consumer loans | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 525 | 518 |
Consumer loans | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 869 | 841 |
Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 4 | 4 |
Total current | 12,882 | 8,357 |
Total loans | 12,886 | 8,361 |
Consumer loans | Overdrafts | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Consumer loans | Overdrafts | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 0 | 0 |
Consumer loans | Overdrafts | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 4 | 4 |
Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 316 | 245 |
Total current | 19,908 | 19,050 |
Total loans | 20,224 | 19,295 |
Consumer loans | Automobile financing | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 125 | 7 |
Consumer loans | Automobile financing | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 29 | 12 |
Consumer loans | Automobile financing | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 162 | 226 |
Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 790 | 769 |
Total current | 83,299 | 78,236 |
Total loans | 84,089 | 79,005 |
Consumer loans | Credit card | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 351 | 422 |
Consumer loans | Credit card | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 313 | 177 |
Consumer loans | Credit card | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 126 | 170 |
Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 1,216 | 1,567 |
Total current | 62,275 | 79,447 |
Total loans | 63,491 | 81,014 |
Consumer loans | Other consumer | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 456 | 797 |
Consumer loans | Other consumer | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 183 | 329 |
Consumer loans | Other consumer | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 577 | 441 |
Residential mortgage loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 76,268 | 64,921 |
Total current | 2,583,768 | 2,429,779 |
Total loans | 2,660,036 | 2,494,700 |
Residential mortgage loans | 30 - 59 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 31,015 | 19,121 |
Residential mortgage loans | 60 - 89 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | 8,859 | 10,142 |
Residential mortgage loans | More than 90 days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due loans | $ 36,394 | $ 35,658 |
Loans - Loans' Credit Quality (
Loans - Loans' Credit Quality (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | $ 4,068,991 | $ 3,812,329 |
Commercial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 652,621 | 545,876 |
Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 33,094 | 21,523 |
Commercial loans | Governments | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 105,664 | 153,401 |
Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 513,863 | 370,952 |
Commercial real estate loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 575,644 | 584,078 |
Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 496,975 | 535,835 |
Commercial real estate loans | Construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 78,669 | 48,243 |
Consumer loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 180,690 | 187,675 |
Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 12,886 | 8,361 |
Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 20,224 | 19,295 |
Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 84,089 | 79,005 |
Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 63,491 | 81,014 |
Residential mortgage loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 2,660,036 | 2,494,700 |
Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 3,835,237 | 3,573,872 |
Pass | Commercial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 633,051 | 524,507 |
Pass | Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 29,896 | 17,558 |
Pass | Commercial loans | Governments | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 101,914 | 149,651 |
Pass | Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 501,241 | 357,298 |
Pass | Commercial real estate loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 523,066 | 512,526 |
Pass | Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 444,397 | 464,283 |
Pass | Commercial real estate loans | Construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 78,669 | 48,243 |
Pass | Consumer loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 177,306 | 184,994 |
Pass | Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 12,650 | 8,263 |
Pass | Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 19,927 | 18,816 |
Pass | Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 83,963 | 78,835 |
Pass | Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 60,766 | 79,080 |
Pass | Residential mortgage loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 2,501,814 | 2,351,845 |
Special mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 101,451 | 109,837 |
Special mention | Commercial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 6,802 | 8,433 |
Special mention | Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 2,705 | 3,569 |
Special mention | Commercial loans | Governments | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Special mention | Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 4,097 | 4,864 |
Special mention | Commercial real estate loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 45,390 | 63,663 |
Special mention | Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 45,390 | 63,663 |
Special mention | Commercial real estate loans | Construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Special mention | Consumer loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 2,220 | 1,745 |
Special mention | Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 232 | 94 |
Special mention | Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 119 | 232 |
Special mention | Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Special mention | Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 1,869 | 1,419 |
Special mention | Residential mortgage loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 47,039 | 35,996 |
Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 83,612 | 84,769 |
Substandard | Commercial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 1,637 | 5,454 |
Substandard | Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 491 | 395 |
Substandard | Commercial loans | Governments | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 3,750 |
Substandard | Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 1,146 | 1,309 |
Substandard | Commercial real estate loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 3,126 | 3,108 |
Substandard | Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 3,126 | 3,108 |
Substandard | Commercial real estate loans | Construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Substandard | Consumer loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 152 | 222 |
Substandard | Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Substandard | Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 16 | 21 |
Substandard | Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 126 | 170 |
Substandard | Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 10 | 31 |
Substandard | Residential mortgage loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 78,697 | 75,985 |
Non-accrual | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 48,691 | 43,851 |
Non-accrual | Commercial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 11,131 | 7,482 |
Non-accrual | Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 2 | 1 |
Non-accrual | Commercial loans | Governments | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 3,750 | 0 |
Non-accrual | Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 7,379 | 7,481 |
Non-accrual | Commercial real estate loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 4,062 | 4,781 |
Non-accrual | Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 4,062 | 4,781 |
Non-accrual | Commercial real estate loans | Construction | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Non-accrual | Consumer loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 1,012 | 714 |
Non-accrual | Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 4 | 4 |
Non-accrual | Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 162 | 226 |
Non-accrual | Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 0 | 0 |
Non-accrual | Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 846 | 484 |
Non-accrual | Residential mortgage loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | $ 32,486 | $ 30,874 |
Loans - Evaluation of Loans For
Loans - Evaluation of Loans For Impairment (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Individually evaluated | $ 122,434 | $ 117,166 |
Collectively evaluated | 3,946,557 | 3,695,163 |
Commercial loans | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Individually evaluated | 12,096 | 8,487 |
Collectively evaluated | 640,525 | 537,389 |
Commercial real estate loans | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Individually evaluated | 7,188 | 7,889 |
Collectively evaluated | 568,456 | 576,189 |
Consumer loans | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Individually evaluated | 1,023 | 1,138 |
Collectively evaluated | 179,667 | 186,537 |
Residential mortgage loans | ||
Financing Receivable, Allowance for Credit Losses [Line Items] | ||
Individually evaluated | 102,127 | 99,652 |
Collectively evaluated | $ 2,557,909 | $ 2,395,048 |
Loans - Changes in General and
Loans - Changes in General and Specific Allowances For Credit Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowances at beginning of year | $ 35,467 | $ 44,247 | $ 49,302 |
Provision taken (released) | (6,991) | (5,837) | 4,399 |
Recoveries | 899 | 1,319 | 1,443 |
Charge-offs | (4,159) | (4,379) | (10,411) |
Other | (114) | 117 | (486) |
Allowances at end of year | 25,102 | 35,467 | 44,247 |
Allowances at end of year: individually evaluated for impairment | 14,915 | 13,624 | 11,738 |
Allowances at end of year: collectively evaluated for impairment | 10,187 | 21,843 | 32,509 |
Commercial loans | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowances at beginning of year | 6,309 | 3,377 | 8,723 |
Provision taken (released) | 865 | 2,853 | (5,265) |
Recoveries | 14 | 106 | 97 |
Charge-offs | (275) | (34) | (138) |
Other | 0 | 7 | (40) |
Allowances at end of year | 6,913 | 6,309 | 3,377 |
Allowances at end of year: individually evaluated for impairment | 4,453 | 2,866 | 577 |
Allowances at end of year: collectively evaluated for impairment | 2,460 | 3,443 | 2,800 |
Commercial real estate loans | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowances at beginning of year | 10,360 | 16,224 | 6,512 |
Provision taken (released) | (6,290) | (5,895) | 14,459 |
Recoveries | 28 | 0 | 12 |
Charge-offs | 0 | (1) | (4,520) |
Other | (6) | 32 | (239) |
Allowances at end of year | 4,092 | 10,360 | 16,224 |
Allowances at end of year: individually evaluated for impairment | 600 | 583 | 750 |
Allowances at end of year: collectively evaluated for impairment | 3,492 | 9,777 | 15,474 |
Consumer loans | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowances at beginning of year | 888 | 965 | 2,763 |
Provision taken (released) | 211 | 1,059 | (1,076) |
Recoveries | 656 | 730 | 1,264 |
Charge-offs | (953) | (1,869) | (1,916) |
Other | 0 | 3 | (70) |
Allowances at end of year | 802 | 888 | 965 |
Allowances at end of year: individually evaluated for impairment | 274 | 274 | 278 |
Allowances at end of year: collectively evaluated for impairment | 528 | 614 | 687 |
Residential mortgage loans | |||
Financing Receivable, Allowance for Credit Losses [Roll Forward] | |||
Allowances at beginning of year | 17,910 | 23,681 | 31,304 |
Provision taken (released) | (1,777) | (3,854) | (3,719) |
Recoveries | 201 | 483 | 70 |
Charge-offs | (2,931) | (2,475) | (3,837) |
Other | (108) | 75 | (137) |
Allowances at end of year | 13,295 | 17,910 | 23,681 |
Allowances at end of year: individually evaluated for impairment | 9,588 | 9,901 | 10,133 |
Allowances at end of year: collectively evaluated for impairment | $ 3,707 | $ 8,009 | $ 13,548 |
Loans - Non-Performing Loans (E
Loans - Non-Performing Loans (Excluding Purchased Credit-impaired Loans) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | $ 4,068,991 | $ 3,812,329 |
Commercial loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 652,621 | 545,876 |
Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 33,094 | 21,523 |
Commercial loans | Governments | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 105,664 | 153,401 |
Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 513,863 | 370,952 |
Commercial real estate loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 575,644 | 584,078 |
Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 496,975 | 535,835 |
Consumer loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 180,690 | 187,675 |
Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 12,886 | 8,361 |
Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 20,224 | 19,295 |
Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 84,089 | 79,005 |
Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 63,491 | 81,014 |
Residential mortgage loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loans | 2,660,036 | 2,494,700 |
Nonperforming Financial Instruments | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 48,691 | 43,851 |
Past due more than 90 days and accruing | 6,458 | 4,356 |
Loans | 55,149 | 48,207 |
Nonperforming Financial Instruments | Commercial loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 11,131 | 7,482 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 11,131 | 7,482 |
Nonperforming Financial Instruments | Commercial loans | Overdrafts | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 2 | 1 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 2 | 1 |
Nonperforming Financial Instruments | Commercial loans | Governments | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 3,750 | 0 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 3,750 | 0 |
Nonperforming Financial Instruments | Commercial loans | Commercial and industrial | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 7,379 | 7,481 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 7,379 | 7,481 |
Nonperforming Financial Instruments | Commercial real estate loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | ||
Past due more than 90 days and accruing | ||
Loans | ||
Nonperforming Financial Instruments | Commercial real estate loans | Commercial mortgage | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 4,062 | 4,781 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 4,062 | 4,781 |
Nonperforming Financial Instruments | Consumer loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 1,012 | 714 |
Past due more than 90 days and accruing | 126 | 170 |
Loans | 1,138 | 884 |
Nonperforming Financial Instruments | Consumer loans | Overdrafts | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 4 | 4 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 4 | 4 |
Nonperforming Financial Instruments | Consumer loans | Automobile financing | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 162 | 226 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 162 | 226 |
Nonperforming Financial Instruments | Consumer loans | Credit card | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 0 | 0 |
Past due more than 90 days and accruing | 126 | 170 |
Loans | 126 | 170 |
Nonperforming Financial Instruments | Consumer loans | Other consumer | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 846 | 484 |
Past due more than 90 days and accruing | 0 | 0 |
Loans | 846 | 484 |
Nonperforming Financial Instruments | Residential mortgage loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual | 32,486 | 30,874 |
Past due more than 90 days and accruing | 6,332 | 4,186 |
Loans | $ 38,818 | $ 35,060 |
Loans - Impaired Loans (Excludi
Loans - Impaired Loans (Excluding Purchased Credit-impaired Loans) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Receivables [Abstract] | |||
Gross interest income that would have been recorded had impaired loans been current | $ 2,100 | $ 2,100 | $ 2,700 |
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 61,970 | 63,095 | |
Impaired loans, Specific allowance | (14,749) | (13,353) | |
Impaired loans with an allowance, Net loans | 47,221 | 49,742 | |
Gross recorded investment of impaired loans without an allowance | 57,329 | 49,748 | |
Impaired loans, Gross recorded investment | 119,299 | 112,843 | |
Impaired loans, Net loans | 104,550 | 99,490 | |
Purchased Credit-Impaired Loans | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans, Specific allowance | (200) | (300) | |
Commercial loans | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 11,129 | 7,475 | |
Impaired loans, Specific allowance | (4,453) | (2,866) | |
Impaired loans with an allowance, Net loans | 6,676 | 4,609 | |
Gross recorded investment of impaired loans without an allowance | 967 | 1,012 | |
Impaired loans, Gross recorded investment | 12,096 | 8,487 | |
Impaired loans, Net loans | 7,643 | 5,621 | |
Commercial loans | Overdrafts | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 0 | 0 | |
Impaired loans, Specific allowance | 0 | 0 | |
Impaired loans with an allowance, Net loans | 0 | 0 | |
Gross recorded investment of impaired loans without an allowance | 2 | 1 | |
Impaired loans, Gross recorded investment | 2 | 1 | |
Impaired loans, Net loans | 2 | 1 | |
Commercial loans | Governments | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 3,750 | ||
Impaired loans, Specific allowance | (1,687) | ||
Impaired loans with an allowance, Net loans | 2,063 | ||
Gross recorded investment of impaired loans without an allowance | 0 | ||
Impaired loans, Gross recorded investment | 3,750 | ||
Impaired loans, Net loans | 2,063 | ||
Commercial loans | Commercial and merchandising | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 7,379 | 7,475 | |
Impaired loans, Specific allowance | (2,766) | (2,866) | |
Impaired loans with an allowance, Net loans | 4,613 | 4,609 | |
Gross recorded investment of impaired loans without an allowance | 965 | 1,011 | |
Impaired loans, Gross recorded investment | 8,344 | 8,486 | |
Impaired loans, Net loans | 5,578 | 5,620 | |
Commercial real estate loans | Commercial mortgage | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 1,081 | 1,585 | |
Impaired loans, Specific allowance | (600) | (583) | |
Impaired loans with an allowance, Net loans | 481 | 1,002 | |
Gross recorded investment of impaired loans without an allowance | 6,108 | 6,304 | |
Impaired loans, Gross recorded investment | 7,189 | 7,889 | |
Impaired loans, Net loans | 6,589 | 7,306 | |
Consumer loans | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 329 | 337 | |
Impaired loans, Specific allowance | (274) | (274) | |
Impaired loans with an allowance, Net loans | 55 | 63 | |
Gross recorded investment of impaired loans without an allowance | 683 | 377 | |
Impaired loans, Gross recorded investment | 1,012 | 714 | |
Impaired loans, Net loans | 738 | 440 | |
Consumer loans | Overdrafts | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 0 | 0 | |
Impaired loans, Specific allowance | 0 | 0 | |
Impaired loans with an allowance, Net loans | 0 | 0 | |
Gross recorded investment of impaired loans without an allowance | 4 | 4 | |
Impaired loans, Gross recorded investment | 4 | 4 | |
Impaired loans, Net loans | 4 | 4 | |
Consumer loans | Automobile financing | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 130 | 138 | |
Impaired loans, Specific allowance | (75) | (75) | |
Impaired loans with an allowance, Net loans | 55 | 63 | |
Gross recorded investment of impaired loans without an allowance | 32 | 88 | |
Impaired loans, Gross recorded investment | 162 | 226 | |
Impaired loans, Net loans | 87 | 151 | |
Consumer loans | Other consumer | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 199 | 199 | |
Impaired loans, Specific allowance | (199) | (199) | |
Impaired loans with an allowance, Net loans | 0 | 0 | |
Gross recorded investment of impaired loans without an allowance | 647 | 285 | |
Impaired loans, Gross recorded investment | 846 | 484 | |
Impaired loans, Net loans | 647 | 285 | |
Residential mortgage loans | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired loans with an allowance, Gross recorded investment | 49,431 | 53,698 | |
Impaired loans, Specific allowance | (9,422) | (9,630) | |
Impaired loans with an allowance, Net loans | 40,009 | 44,068 | |
Gross recorded investment of impaired loans without an allowance | 49,571 | 42,055 | |
Impaired loans, Gross recorded investment | 99,002 | 95,753 | |
Impaired loans, Net loans | $ 89,580 | $ 86,123 |
Loans - Average Impaired Loan B
Loans - Average Impaired Loan Balances and Related Recognized Interest Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | $ 117,947 | $ 102,765 | $ 100,321 |
Interest income recognized | 4,923 | 4,663 | 2,502 |
Commercial loans | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 12,167 | 5,059 | 1,675 |
Interest income recognized | 68 | 63 | 64 |
Commercial loans | Overdrafts | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 2 | 2 | 14 |
Interest income recognized | 0 | 0 | 0 |
Commercial loans | Governments | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 3,750 | 0 | 0 |
Interest income recognized | 0 | 0 | 0 |
Commercial loans | Commercial and merchandising | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 8,415 | 5,057 | 1,661 |
Interest income recognized | 68 | 63 | 64 |
Commercial real estate loans | Commercial mortgage | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 7,539 | 7,778 | 15,496 |
Interest income recognized | 287 | 222 | 237 |
Consumer loans | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 863 | 865 | 1,249 |
Interest income recognized | 0 | 0 | 0 |
Consumer loans | Overdrafts | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 4 | 11 | 14 |
Interest income recognized | 0 | 0 | 0 |
Consumer loans | Automobile financing | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 194 | 256 | 192 |
Interest income recognized | 0 | 0 | 0 |
Consumer loans | Other consumer | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 665 | 598 | 1,043 |
Interest income recognized | 0 | 0 | 0 |
Residential mortgage loans | |||
Financing Receivable, Impaired [Line Items] | |||
Average gross recorded investment | 97,378 | 89,063 | 81,901 |
Interest income recognized | $ 4,568 | $ 4,378 | $ 2,201 |
Loans - Loans Modified in a TDR
Loans - Loans Modified in a TDR (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)contract | Dec. 31, 2017USD ($)contract | Dec. 31, 2016USD ($)contract | |
Receivables [Abstract] | |||
Subsequent default, number of contracts | contract | 2 | 0 | 1 |
Subsequent default, recorded investment | $ 800 | $ 900 | |
Financing Receivable, Modifications [Line Items] | |||
Number of contracts | contract | 19 | 44 | 21 |
Pre- modification recorded investment | $ 7,864 | $ 26,132 | $ 12,543 |
Modification: interest capitalization | 846 | 1,345 | 81 |
Post- modification recorded investment | 8,710 | 27,477 | $ 12,624 |
TDRs outstanding, Accrual | 70,608 | 68,992 | |
TDRs outstanding, Non-accrual | 9,490 | 7,094 | |
Commercial loans | |||
Financing Receivable, Modifications [Line Items] | |||
TDRs outstanding, Accrual | 965 | 1,005 | |
TDRs outstanding, Non-accrual | 0 | $ 0 | |
Commercial real estate loans | |||
Financing Receivable, Modifications [Line Items] | |||
Number of contracts | contract | 2 | ||
Pre- modification recorded investment | $ 1,544 | ||
Modification: interest capitalization | 0 | ||
Post- modification recorded investment | 1,544 | ||
TDRs outstanding, Accrual | 3,127 | 3,108 | |
TDRs outstanding, Non-accrual | $ 1,336 | $ 1,471 | |
Residential mortgage loans | |||
Financing Receivable, Modifications [Line Items] | |||
Number of contracts | contract | 19 | 42 | 21 |
Pre- modification recorded investment | $ 7,864 | $ 24,588 | $ 12,543 |
Modification: interest capitalization | 846 | 1,345 | 81 |
Post- modification recorded investment | 8,710 | 25,933 | $ 12,624 |
TDRs outstanding, Accrual | 66,516 | 64,879 | |
TDRs outstanding, Non-accrual | $ 8,154 | $ 5,623 |
Loans - Purchased Credit-Impair
Loans - Purchased Credit-Impaired Loans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Contractual principal | |||
Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Balance at beginning of year | $ 6,001 | $ 8,016 | $ 8,709 |
Advances and increases in cash flows expected to be collected | 25 | 36 | 166 |
Reductions resulting from repayments | (1,495) | (1,581) | (464) |
Reductions resulting from changes in allowances for credit losses | 0 | 0 | 0 |
Reductions resulting from charge-offs | (470) | (395) | |
Balance at end of year | 4,531 | 6,001 | 8,016 |
Non-accretable difference | |||
Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Balance at beginning of year | (1,239) | (1,617) | (2,248) |
Advances and increases in cash flows expected to be collected | 42 | 48 | 408 |
Reductions resulting from repayments | 191 | 307 | 0 |
Reductions resulting from changes in allowances for credit losses | 105 | (99) | (172) |
Reductions resulting from charge-offs | 122 | 395 | |
Balance at end of year | (901) | (1,239) | (1,617) |
Accretable difference | |||
Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Balance at beginning of year | (711) | (811) | (631) |
Advances and increases in cash flows expected to be collected | (42) | (48) | (396) |
Reductions resulting from repayments | 92 | 148 | 216 |
Reductions resulting from changes in allowances for credit losses | 0 | 0 | 0 |
Reductions resulting from charge-offs | 0 | 0 | |
Balance at end of year | (661) | (711) | (811) |
Carrying amount | |||
Certain Loans Acquired in Transfer Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Balance at beginning of year | 4,051 | 5,588 | 5,830 |
Advances and increases in cash flows expected to be collected | 25 | 36 | 178 |
Reductions resulting from repayments | (1,212) | (1,126) | (248) |
Reductions resulting from changes in allowances for credit losses | 105 | (99) | (172) |
Reductions resulting from charge-offs | (348) | 0 | |
Balance at end of year | $ 2,969 | $ 4,051 | $ 5,588 |
Credit risk concentrations (Det
Credit risk concentrations (Details) - Credit Availability Concentration Risk - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Total Credit Exposure [Member] | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | $ 6,881,253 | $ 6,558,344 |
Credit exposure, General allowance | (10,187) | (21,843) |
Credit exposure, Total | 6,871,066 | 6,536,501 |
Total Credit Exposure [Member] | Australia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 145,675 | 113,920 |
Total Credit Exposure [Member] | Bermuda | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 2,504,531 | 2,566,280 |
Total Credit Exposure [Member] | Canada | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 759,437 | 386,322 |
Total Credit Exposure [Member] | Cayman | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 970,745 | 967,440 |
Total Credit Exposure [Member] | Guernsey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 313,203 | 334,457 |
Total Credit Exposure [Member] | Japan | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 14,271 | 12,852 |
Total Credit Exposure [Member] | Jersey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 9,532 | 0 |
Total Credit Exposure [Member] | New Zealand | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,082 | 7,951 |
Total Credit Exposure [Member] | Norway | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 8,750 | 25,440 |
Total Credit Exposure [Member] | Saint Lucia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 90,000 | 120,000 |
Total Credit Exposure [Member] | Switzerland | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 6,637 | 5,743 |
Total Credit Exposure [Member] | The Bahamas | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 15,901 | 19,103 |
Total Credit Exposure [Member] | United Kingdom | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,623,857 | 1,443,385 |
Total Credit Exposure [Member] | United States | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 411,248 | 544,703 |
Total Credit Exposure [Member] | Other | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 6,384 | 10,748 |
Total credit exposure | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 4,747,693 | 4,594,453 |
Credit exposure, General allowance | (10,187) | (21,843) |
Credit exposure, Total | 4,737,506 | 4,572,610 |
Total credit exposure | Banks and financial services | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,026,528 | 849,410 |
Total credit exposure | Commercial and merchandising | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 498,789 | 455,143 |
Total credit exposure | Governments | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 104,857 | 239,759 |
Total credit exposure | Individuals | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 2,429,785 | 2,388,847 |
Total credit exposure | Primary industry and manufacturing | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 121,091 | 69,099 |
Total credit exposure | Real estate | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 396,633 | 441,820 |
Total credit exposure | Hospitality industry | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 164,177 | 144,881 |
Total credit exposure | Transport and communication | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 5,833 | 5,494 |
Cash due from banks, resell agreements and short-term investments | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 2,133,560 | 1,963,891 |
Credit exposure, General allowance | 0 | 0 |
Credit exposure, Total | 2,133,560 | 1,963,891 |
Cash due from banks, resell agreements and short-term investments | Australia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 145,675 | 113,920 |
Cash due from banks, resell agreements and short-term investments | Bermuda | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 36,827 | 14,512 |
Cash due from banks, resell agreements and short-term investments | Canada | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 759,437 | 386,322 |
Cash due from banks, resell agreements and short-term investments | Cayman | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 18,138 | 67,942 |
Cash due from banks, resell agreements and short-term investments | Guernsey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 6 | 3 |
Cash due from banks, resell agreements and short-term investments | Japan | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 14,271 | 12,852 |
Cash due from banks, resell agreements and short-term investments | Jersey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Cash due from banks, resell agreements and short-term investments | New Zealand | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,082 | 7,951 |
Cash due from banks, resell agreements and short-term investments | Norway | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 8,750 | 25,440 |
Cash due from banks, resell agreements and short-term investments | Saint Lucia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Cash due from banks, resell agreements and short-term investments | Switzerland | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 6,637 | 5,743 |
Cash due from banks, resell agreements and short-term investments | The Bahamas | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,534 | 1,652 |
Cash due from banks, resell agreements and short-term investments | United Kingdom | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 725,634 | 775,853 |
Cash due from banks, resell agreements and short-term investments | United States | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 411,248 | 544,703 |
Cash due from banks, resell agreements and short-term investments | Other | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 4,321 | 6,998 |
Loans | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 4,054,076 | 3,798,705 |
Credit exposure, General allowance | (10,187) | (21,843) |
Credit exposure, Total | 4,043,889 | 3,776,862 |
Loans | Australia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | Bermuda | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 2,133,859 | 2,132,918 |
Loans | Canada | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | Cayman | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 730,418 | 669,767 |
Loans | Guernsey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 290,578 | 292,806 |
Loans | Japan | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | Jersey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 9,083 | 0 |
Loans | New Zealand | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | Norway | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | Saint Lucia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 90,000 | 120,000 |
Loans | Switzerland | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | The Bahamas | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 14,367 | 17,451 |
Loans | United Kingdom | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 783,708 | 562,013 |
Loans | United States | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Loans | Other | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 2,063 | 3,750 |
Loans | Banks and financial services | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 611,404 | 459,132 |
Loans | Commercial and merchandising | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 316,349 | 261,560 |
Loans | Governments | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 104,857 | 153,952 |
Loans | Individuals | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 2,339,854 | 2,274,632 |
Loans | Primary industry and manufacturing | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 120,088 | 59,532 |
Loans | Real estate | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 395,086 | 439,595 |
Loans | Hospitality industry | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 160,680 | 144,808 |
Loans | Transport and communication | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 5,758 | 5,494 |
Off-balance sheet | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 693,617 | 795,748 |
Credit exposure, General allowance | 0 | 0 |
Credit exposure, Total | 693,617 | 795,748 |
Off-balance sheet | Australia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Bermuda | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 333,845 | 418,850 |
Off-balance sheet | Canada | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Cayman | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 222,189 | 229,731 |
Off-balance sheet | Guernsey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 22,619 | 41,648 |
Off-balance sheet | Japan | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Jersey | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 449 | 0 |
Off-balance sheet | New Zealand | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Norway | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Saint Lucia | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Switzerland | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | The Bahamas | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | United Kingdom | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 114,515 | 105,519 |
Off-balance sheet | United States | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Other | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 0 |
Off-balance sheet | Banks and financial services | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 415,124 | 390,278 |
Off-balance sheet | Commercial and merchandising | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 182,440 | 193,583 |
Off-balance sheet | Governments | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 0 | 85,807 |
Off-balance sheet | Individuals | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 89,931 | 114,215 |
Off-balance sheet | Primary industry and manufacturing | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,003 | 9,567 |
Off-balance sheet | Real estate | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 1,547 | 2,225 |
Off-balance sheet | Hospitality industry | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | 3,497 | 73 |
Off-balance sheet | Transport and communication | ||
Concentration Risk [Line Items] | ||
Credit exposure, Sub-total | $ 75 | $ 0 |
Premises, equipment and compu_3
Premises, equipment and computer software - Schedule of Premise, Equipment, and Computer Software (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Cost | $ 357,055 | $ 342,346 | |
Accumulated depreciation | (198,995) | (177,556) | |
Net carrying value | 158,060 | 164,790 | |
Total depreciation charged to operating expenses | 26,137 | 23,499 | $ 24,277 |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 8,612 | 9,008 | |
Accumulated depreciation | 0 | 0 | |
Net carrying value | 8,612 | 9,008 | |
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 144,196 | 139,534 | |
Accumulated depreciation | (61,853) | (59,110) | |
Net carrying value | 82,343 | 80,424 | |
Total depreciation charged to operating expenses | 4,283 | 3,781 | 4,058 |
Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 21,323 | 20,000 | |
Accumulated depreciation | (15,490) | (15,997) | |
Net carrying value | 5,833 | 4,003 | |
Total depreciation charged to operating expenses | 1,413 | 1,336 | 1,462 |
Computer hardware and software in use | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 177,017 | 165,251 | |
Accumulated depreciation | (121,652) | (102,449) | |
Net carrying value | 55,365 | 62,802 | |
Total depreciation charged to operating expenses | 20,441 | 18,382 | $ 18,757 |
Computer software in development | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 5,907 | 8,553 | |
Accumulated depreciation | 0 | 0 | |
Net carrying value | $ 5,907 | $ 8,553 |
Goodwill and other intangible_3
Goodwill and other intangible assets - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Roll Forward] | |||
Balance at beginning of year | $ 21,529 | $ 19,622 | $ 23,462 |
Acquisitions during the year | 3,868 | ||
Foreign exchange translation adjustment | (1,406) | 1,907 | (3,840) |
Balance at end of year | 23,991 | 21,529 | 19,622 |
Cayman | |||
Goodwill [Roll Forward] | |||
Balance at beginning of year | 0 | 0 | 0 |
Acquisitions during the year | 551 | ||
Foreign exchange translation adjustment | 0 | 0 | 0 |
Balance at end of year | 551 | 0 | 0 |
Channel Islands and the UK | |||
Goodwill [Roll Forward] | |||
Balance at beginning of year | 21,529 | 19,622 | 23,462 |
Acquisitions during the year | 1,231 | ||
Foreign exchange translation adjustment | (1,333) | 1,907 | (3,840) |
Balance at end of year | 21,427 | 21,529 | 19,622 |
Other | |||
Goodwill [Roll Forward] | |||
Balance at beginning of year | 0 | 0 | 0 |
Acquisitions during the year | 2,086 | ||
Foreign exchange translation adjustment | (73) | 0 | 0 |
Balance at end of year | $ 2,013 | $ 0 | $ 0 |
Goodwill and other intangible_4
Goodwill and other intangible assets - Customer Relationship Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Net carrying amount | $ 50,751 | $ 39,066 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 118,774 | 100,529 |
Accumulated amortization | (68,023) | (61,463) |
Net carrying amount | 50,751 | 39,066 |
Bermuda | Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 29,785 | 29,785 |
Accumulated amortization | (11,733) | (9,748) |
Net carrying amount | 18,052 | 20,037 |
Cayman | Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 17,728 | 12,324 |
Accumulated amortization | (4,571) | (3,557) |
Net carrying amount | 13,157 | 8,767 |
Channel Islands and the UK | Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 65,698 | 58,420 |
Accumulated amortization | (51,210) | (48,158) |
Net carrying amount | 14,488 | 10,262 |
Other | Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 5,563 | 0 |
Accumulated amortization | (509) | 0 |
Net carrying amount | $ 5,054 | $ 0 |
Goodwill and other intangible_5
Goodwill and other intangible assets - Narrative (Details) - USD ($) | Mar. 29, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 5,091,000 | $ 4,210,000 | $ 4,514,000 | |
Deutsche Bank’s Global Trust Solutions | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Acquired finite-lived intangible assets, useful life | 15 years | |||
Customer Relationships | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Assets acquired | $ 18,200,000 | 0 | 21,400,000 | |
Acquired finite-lived intangible assets, useful life | 15 years | |||
Amortization expense | $ 5,100,000 | 4,200,000 | 4,500,000 | |
Foreign currency translation decrease in net carrying amount | 1,500,000 | $ 1,000,000 | $ 2,300,000 | |
Estimated aggregate amortization expense, next twelve months | 5,400,000 | |||
Estimated aggregate amortization expense, year two | 5,400,000 | |||
Estimated aggregate amortization expense, year three | 5,400,000 | |||
Estimated aggregate amortization expense, year four | 5,400,000 | |||
Estimated aggregate amortization expense, year five | 5,400,000 | |||
Customer Relationships | Deutsche Bank’s Global Trust Solutions | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Assets acquired | 16,900,000 | |||
Customer Relationships | Asset Acquisitions | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Assets acquired | $ 1,300,000 |
Customer deposits and deposit_3
Customer deposits and deposits from banks (Details) $ in Thousands | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Time Deposits [Line Items] | ||
Non-interest-bearing, Demand | $ 2,119,596 | $ 2,480,168 |
Interest-bearing, Demand | 5,357,312 | 5,341,632 |
Total demand deposits | 7,476,908 | 7,821,800 |
Term, Within 3 months | 1,244,675 | 1,341,235 |
Term, 3 to 6 months | 228,141 | 131,614 |
Term, 6 to 12 months | 432,470 | 182,982 |
Term, After 12 months | 70,047 | 58,827 |
Total term | 1,975,333 | 1,714,658 |
Total deposits | $ 9,452,241 | $ 9,536,458 |
Weighted average interest rate, demand deposits | 0.0013 | 0.0002 |
Customers | ||
Time Deposits [Line Items] | ||
Non-interest-bearing, Demand | $ 2,111,496 | $ 2,479,726 |
Interest-bearing, Demand | 5,338,347 | 5,333,928 |
Total demand deposits | 7,449,843 | 7,813,654 |
Term, Within 3 months | 1,238,019 | 1,337,015 |
Term, 3 to 6 months | 228,141 | 131,614 |
Term, 6 to 12 months | 432,369 | 182,882 |
Term, After 12 months | 70,047 | 58,827 |
Total term | 1,968,576 | 1,710,338 |
Total deposits | 9,418,419 | 9,523,992 |
Banks | ||
Time Deposits [Line Items] | ||
Non-interest-bearing, Demand | 8,100 | 442 |
Interest-bearing, Demand | 18,965 | 7,704 |
Total demand deposits | 27,065 | 8,146 |
Term, Within 3 months | 6,656 | 4,220 |
Term, 3 to 6 months | 0 | 0 |
Term, 6 to 12 months | 101 | 100 |
Term, After 12 months | 0 | 0 |
Total term | 6,757 | 4,320 |
Total deposits | 33,822 | 12,466 |
Bermuda | Customers | ||
Time Deposits [Line Items] | ||
Non-interest-bearing, Demand | 1,378,539 | 1,840,201 |
Interest-bearing, Demand | 2,158,971 | 2,578,411 |
Total demand deposits | 3,537,510 | 4,418,612 |
Term, less than $100k, Within 3 months | 12,387 | 13,983 |
Term, less than $100k, 3 to 6 months | 4,306 | 4,267 |
Term, less than $100k, 6 to 12 months | 8,049 | 8,640 |
Term, less than $100k, After 12 months | 14,644 | 13,984 |
Total term, less than $100k | 39,386 | 40,874 |
Total deposits, less than $100k | 3,576,896 | 4,459,486 |
Term, $100k or More, Within 3 months | 598,528 | 646,751 |
Term, $100k or More, 3 to 6 months | 92,427 | 33,495 |
Term, $100k or More, 6 to 12 months | 184,337 | 75,235 |
Term, $100k or More, After 12 months | 43,414 | 37,857 |
Total term, $100k or More | 918,706 | 793,338 |
Total deposits, More than $100k | 918,706 | 793,338 |
Term, Within 3 months | 610,915 | 660,734 |
Term, 3 to 6 months | 96,733 | 37,762 |
Term, 6 to 12 months | 192,386 | 83,875 |
Term, After 12 months | 58,058 | 51,841 |
Total term | 958,092 | 834,212 |
Total deposits | 4,495,602 | 5,252,824 |
Bermuda | Banks | ||
Time Deposits [Line Items] | ||
Non-interest-bearing, Demand | 8,100 | 442 |
Interest-bearing, Demand | 0 | 0 |
Total demand deposits | 8,100 | 442 |
Term, less than $100k, Within 3 months | 0 | 0 |
Term, less than $100k, 3 to 6 months | 0 | 0 |
Term, less than $100k, 6 to 12 months | 0 | 0 |
Term, less than $100k, After 12 months | 0 | 0 |
Total term, less than $100k | 0 | 0 |
Total deposits, less than $100k | 8,100 | 442 |
Non-Bermuda | Customers | ||
Time Deposits [Line Items] | ||
Term, less than $100k, Within 3 months | 18,714 | 19,147 |
Term, less than $100k, 3 to 6 months | 5,386 | 5,202 |
Term, less than $100k, 6 to 12 months | 4,705 | 4,762 |
Term, less than $100k, After 12 months | 507 | 781 |
Total term, less than $100k | 29,312 | 29,892 |
Total deposits, less than $100k | 3,941,645 | 3,424,934 |
Non-interest-bearing, Demand | 732,957 | 639,525 |
Interest-bearing, Demand | 3,179,376 | 2,755,517 |
Total demand deposits | 3,912,333 | 3,395,042 |
Term, $100k or More, Within 3 months | 608,390 | 657,134 |
Term, $100k or More, 3 to 6 months | 126,022 | 88,650 |
Term, $100k or More, 6 to 12 months | 235,278 | 94,245 |
Term, $100k or More, After 12 months | 11,482 | 6,205 |
Total term, $100k or More | 981,172 | 846,234 |
Total deposits, More than $100k | 981,172 | 846,234 |
Term, Within 3 months | 627,104 | 676,281 |
Term, 3 to 6 months | 131,408 | 93,852 |
Term, 6 to 12 months | 239,983 | 99,007 |
Term, After 12 months | 11,989 | 6,986 |
Total term | 1,010,484 | 876,126 |
Total deposits | 4,922,817 | 4,271,168 |
Non-Bermuda | Banks | ||
Time Deposits [Line Items] | ||
Term, less than $100k, Within 3 months | 0 | 0 |
Term, less than $100k, 3 to 6 months | 0 | 0 |
Term, less than $100k, 6 to 12 months | 0 | 0 |
Term, less than $100k, After 12 months | 0 | 0 |
Total term, less than $100k | 0 | 0 |
Total deposits, less than $100k | 18,965 | 7,704 |
Non-interest-bearing, Demand | 0 | 0 |
Interest-bearing, Demand | 18,965 | 7,704 |
Total demand deposits | 18,965 | 7,704 |
Term, $100k or More, Within 3 months | 6,656 | 4,220 |
Term, $100k or More, 3 to 6 months | 0 | 0 |
Term, $100k or More, 6 to 12 months | 101 | 100 |
Term, $100k or More, After 12 months | 0 | 0 |
Total term, $100k or More | 6,757 | 4,320 |
Total deposits, More than $100k | 6,757 | 4,320 |
Term, Within 3 months | 6,656 | 4,220 |
Term, 3 to 6 months | 0 | 0 |
Term, 6 to 12 months | 101 | 100 |
Term, After 12 months | 0 | 0 |
Total term | 6,757 | 4,320 |
Total deposits | $ 25,722 | $ 12,024 |
Customer deposits and deposit_4
Customer deposits and deposits from banks - By Type and Segment (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Time Deposits [Line Items] | ||
Payable on demand | $ 7,476,908 | $ 7,821,800 |
Payable on a fixed date | 1,975,333 | 1,714,658 |
Total deposits | 9,452,241 | 9,536,458 |
Customers | ||
Time Deposits [Line Items] | ||
Payable on demand | 7,449,843 | 7,813,654 |
Payable on a fixed date | 1,968,576 | 1,710,338 |
Total deposits | 9,418,419 | 9,523,992 |
Customers | Bermuda | ||
Time Deposits [Line Items] | ||
Payable on demand | 3,537,510 | 4,418,649 |
Payable on a fixed date | 958,092 | 834,211 |
Total deposits | 4,495,602 | 5,252,860 |
Customers | Cayman | ||
Time Deposits [Line Items] | ||
Payable on demand | 2,847,793 | 2,529,499 |
Payable on a fixed date | 472,442 | 405,215 |
Total deposits | 3,320,235 | 2,934,714 |
Customers | Channel Islands and the UK | ||
Time Deposits [Line Items] | ||
Payable on demand | 1,064,540 | 865,506 |
Payable on a fixed date | 538,042 | 470,912 |
Total deposits | 1,602,582 | 1,336,418 |
Banks | ||
Time Deposits [Line Items] | ||
Payable on demand | 27,065 | 8,146 |
Payable on a fixed date | 6,757 | 4,320 |
Total deposits | 33,822 | 12,466 |
Banks | Bermuda | ||
Time Deposits [Line Items] | ||
Payable on demand | 8,100 | 442 |
Payable on a fixed date | 0 | 0 |
Total deposits | 8,100 | 442 |
Banks | Cayman | ||
Time Deposits [Line Items] | ||
Payable on demand | 17,564 | 7,704 |
Payable on a fixed date | 6,757 | 4,320 |
Total deposits | 24,321 | 12,024 |
Banks | Channel Islands and the UK | ||
Time Deposits [Line Items] | ||
Payable on demand | 1,401 | 0 |
Payable on a fixed date | 0 | 0 |
Total deposits | $ 1,401 | $ 0 |
Employee benefit plans - Narrat
Employee benefit plans - Narrative (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Guernsey | Pension plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Remaining life expectancy, inactive participants | 39 years |
Remaining life expectancy, active members | 15 years |
Postretirement Health Coverage 2010 Amendment | Bermuda | |
Defined Benefit Plan Disclosure [Line Items] | |
Remaining service period | 3 years 1 month 6 days |
Postretirement Health Coverage 2011 Amendment | Bermuda | |
Defined Benefit Plan Disclosure [Line Items] | |
Remaining service period | 4 years 7 months 6 days |
Postretirement Health Coverage 2014 Amendment | Bermuda | |
Defined Benefit Plan Disclosure [Line Items] | |
Remaining life expectancy | 21 years |
Employee benefit plans - Financ
Employee benefit plans - Financial Position of Defined Benefit Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Amounts recognized in the consolidated balance sheets consist of: | |||
Accrued pension benefit cost included in employee benefit plans liability | $ (117,203) | $ (128,798) | |
Pension plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Accumulated benefit obligation at end of year | 148,966 | 179,613 | $ 178,068 |
Change in projected benefit obligation | |||
Projected benefit obligation at beginning of year | 179,613 | 178,068 | 166,815 |
Service cost | 0 | 0 | 0 |
Interest cost | 4,971 | 5,361 | 5,781 |
Benefits paid | (17,274) | (13,444) | (10,477) |
Prior service cost | 212 | 0 | 0 |
Settlement and curtailment of liability | (1,825) | (6,108) | 0 |
Actuarial (gain) loss | (12,423) | 7,384 | 30,953 |
Foreign exchange translation adjustment | (4,308) | 8,352 | (15,004) |
Projected benefit obligation at end of year | 148,966 | 179,613 | 178,068 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 185,495 | 172,206 | 179,961 |
Actual return on plan assets | (11,618) | 14,801 | 18,615 |
Employer contribution | 3,653 | 8,448 | 678 |
Plan settlement | (1,608) | (5,123) | 0 |
Benefits paid | (17,274) | (13,444) | (10,477) |
Foreign exchange translation adjustment | (4,497) | 8,607 | (16,571) |
Fair value of plan assets at end of year | 154,151 | 185,495 | 172,206 |
Amounts recognized in the consolidated balance sheets consist of: | |||
Prepaid benefit cost included in other assets | 5,185 | 6,993 | 7,771 |
Accrued pension benefit cost included in employee benefit plans liability | 0 | (1,111) | (13,633) |
Surplus (deficit) of plan assets over projected benefit obligation at measurement date | 5,185 | 5,882 | (5,862) |
Post- retirement medical benefit plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Accumulated benefit obligation at end of year | 117,203 | 127,687 | 126,334 |
Change in projected benefit obligation | |||
Projected benefit obligation at beginning of year | 127,687 | 126,334 | 119,107 |
Service cost | 63 | 64 | 118 |
Interest cost | 4,305 | 4,703 | 4,792 |
Benefits paid | (3,263) | (2,118) | (3,594) |
Prior service cost | 0 | 0 | 0 |
Settlement and curtailment of liability | 0 | 0 | 0 |
Actuarial (gain) loss | (11,589) | (1,296) | 5,911 |
Foreign exchange translation adjustment | 0 | 0 | 0 |
Projected benefit obligation at end of year | 117,203 | 127,687 | 126,334 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 0 | 0 | 0 |
Actual return on plan assets | 0 | 0 | 0 |
Employer contribution | 3,263 | 2,118 | 3,594 |
Plan settlement | 0 | 0 | 0 |
Benefits paid | (3,263) | (2,118) | (3,594) |
Foreign exchange translation adjustment | 0 | 0 | 0 |
Fair value of plan assets at end of year | 0 | 0 | 0 |
Amounts recognized in the consolidated balance sheets consist of: | |||
Prepaid benefit cost included in other assets | 0 | 0 | 0 |
Accrued pension benefit cost included in employee benefit plans liability | (117,203) | (127,687) | (126,334) |
Surplus (deficit) of plan assets over projected benefit obligation at measurement date | $ (117,203) | $ (127,687) | $ (126,334) |
Employee benefit plans - Amount
Employee benefit plans - Amounts Recognized in AOCI, Benefit Expense (Income), and OCI (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Pension plans | |||
Amounts recognized in accumulated other comprehensive loss consist of: | |||
Net actuarial gain (loss), excluding deferred taxes | $ (65,506) | $ (62,521) | $ (64,852) |
Net prior service credit (cost) | (202) | 0 | 0 |
Deferred income taxes assets (liabilities) | 816 | 1,180 | 1,620 |
Net amount recognized in accumulated other comprehensive loss | (64,892) | (61,341) | (63,232) |
Expense component | |||
Service cost | 0 | 0 | 0 |
Interest cost | 4,971 | 5,361 | 5,781 |
Expected return on plan assets | (8,720) | (8,199) | (8,943) |
Amortization of net actuarial (gains) losses | 2,106 | 2,238 | 1,702 |
Amortization of prior service (credit) loss | 0 | 0 | 0 |
(Gain) loss on settlement | 1,757 | 1,232 | 0 |
Defined benefit (income) expense | 114 | 632 | (1,460) |
Defined contribution expense | 7,442 | 6,521 | 6,606 |
Total benefit (income) expense | 7,556 | 7,153 | 5,146 |
Other Changes Recognized in Other Comprehensive Income (Loss) | |||
Net gain (loss) arising during the year | (5,987) | 1,472 | (19,956) |
Amortization of net actuarial (gains) losses | 2,106 | 2,247 | 1,702 |
Amortization of prior service (credit) cost | 0 | 0 | 0 |
Change in deferred taxes | (298) | (595) | 1,315 |
Foreign exchange adjustment | 840 | (1,233) | 38 |
Total changes recognized in other comprehensive income (loss) | (3,551) | 1,891 | (16,901) |
Post- retirement medical benefit plan | |||
Amounts recognized in accumulated other comprehensive loss consist of: | |||
Net actuarial gain (loss), excluding deferred taxes | (12,946) | (27,150) | (31,959) |
Net prior service credit (cost) | (6,397) | (6,436) | (5,678) |
Deferred income taxes assets (liabilities) | 0 | 0 | 0 |
Net amount recognized in accumulated other comprehensive loss | (19,343) | (33,586) | (37,637) |
Expense component | |||
Service cost | 63 | 64 | 118 |
Interest cost | 4,305 | 4,703 | 4,792 |
Expected return on plan assets | 0 | 0 | 0 |
Amortization of net actuarial (gains) losses | 2,615 | 3,514 | 2,731 |
Amortization of prior service (credit) loss | 39 | (759) | (6,343) |
(Gain) loss on settlement | 0 | 0 | 0 |
Defined benefit (income) expense | 7,022 | 7,522 | 1,298 |
Defined contribution expense | 0 | 0 | 0 |
Total benefit (income) expense | 7,022 | 7,522 | 1,298 |
Other Changes Recognized in Other Comprehensive Income (Loss) | |||
Net gain (loss) arising during the year | 11,589 | 1,296 | (5,911) |
Amortization of net actuarial (gains) losses | 2,615 | 3,514 | 2,731 |
Amortization of prior service (credit) cost | 39 | (759) | (6,343) |
Change in deferred taxes | 0 | 0 | 0 |
Foreign exchange adjustment | 0 | 0 | 0 |
Total changes recognized in other comprehensive income (loss) | $ 14,243 | $ 4,051 | $ (9,523) |
Employee benefit plans - Actuar
Employee benefit plans - Actuarial Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Pension plans | |||
Actuarial assumptions used to determine annual benefit expense | |||
Weighted average discount rate | 3.05% | 3.40% | 3.90% |
Weighted average rate of compensation increases | 2.50% | 2.50% | 2.30% |
Weighted average expected long-term rate of return on plan assets | 4.70% | 4.75% | 5.30% |
Actuarial assumptions used to determine benefit obligations at end of year | |||
Weighted average discount rate | 3.65% | 3.05% | 3.40% |
Weighted average rate of compensation increases | 2.50% | 2.40% | 2.50% |
Post- retirement medical benefit plan | |||
Actuarial assumptions used to determine annual benefit expense | |||
Weighted average discount rate | 3.73% | 4.37% | 4.70% |
Actuarial assumptions used to determine benefit obligations at end of year | |||
Weighted average discount rate | 4.40% | 3.73% | 4.37% |
Post- retirement medical benefit plan | Minimum | |||
Actuarial assumptions used to determine annual benefit expense | |||
Weighted average annual medical cost increase rate | 7.70% | 7.80% | 8.00% |
Actuarial assumptions used to determine benefit obligations at end of year | |||
Weighted average annual medical cost increase rate | 7.50% | 7.70% | 7.80% |
Post- retirement medical benefit plan | Maximum | |||
Actuarial assumptions used to determine annual benefit expense | |||
Weighted average annual medical cost increase rate | 4.50% | 4.50% | 4.50% |
Actuarial assumptions used to determine benefit obligations at end of year | |||
Weighted average annual medical cost increase rate | 4.50% | 4.50% | 4.50% |
Employee benefit plans - Invest
Employee benefit plans - Investments Policies and Strategies (Details) - Pension plans | Dec. 31, 2018 | Dec. 31, 2017 |
Weighted average actual and target asset allocations of the pension plans by asset category | ||
Actual allocation | 100.00% | 100.00% |
Target allocation | 100.00% | 100.00% |
Debt securities (including debt mutual funds) | ||
Weighted average actual and target asset allocations of the pension plans by asset category | ||
Actual allocation | 33.00% | 34.00% |
Target allocation | 47.00% | 48.00% |
Equity securities (including equity mutual funds) | ||
Weighted average actual and target asset allocations of the pension plans by asset category | ||
Actual allocation | 55.00% | 52.00% |
Target allocation | 37.00% | 47.00% |
Other | ||
Weighted average actual and target asset allocations of the pension plans by asset category | ||
Actual allocation | 12.00% | 14.00% |
Target allocation | 16.00% | 5.00% |
Employee benefit plans - Fair V
Employee benefit plans - Fair Value Measurements of Pension Plans' Assets (Details) - Pension plans - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 154,151 | $ 185,495 | $ 172,206 | $ 179,961 |
Actual allocation | 100.00% | 100.00% | ||
Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 925 | $ 1,096 | ||
Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 136,266 | 168,740 | ||
Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 16,960 | 15,659 | ||
US government and federal agencies | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 10,221 | 11,318 | ||
US government and federal agencies | Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
US government and federal agencies | Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 10,221 | 11,318 | ||
US government and federal agencies | Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
Non-US governments debt securities | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 1,039 | 12,139 | ||
Non-US governments debt securities | Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
Non-US governments debt securities | Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 1,039 | 12,139 | ||
Non-US governments debt securities | Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
Corporate debt securities | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 39,589 | 39,072 | ||
Corporate debt securities | Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
Corporate debt securities | Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 39,589 | 39,072 | ||
Corporate debt securities | Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
Equity securities (including equity mutual funds) | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 84,563 | $ 96,390 | ||
Actual allocation | 55.00% | 52.00% | ||
Equity securities (including equity mutual funds) | Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 925 | $ 1,096 | ||
Equity securities (including equity mutual funds) | Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 83,638 | 95,294 | ||
Equity securities (including equity mutual funds) | Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 0 | 0 | ||
Other | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 18,739 | $ 26,576 | ||
Actual allocation | 12.00% | 14.00% | ||
Other | Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 0 | $ 0 | ||
Other | Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | 1,779 | 10,917 | ||
Other | Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total fair value of plans' assets | $ 16,960 | $ 15,659 | ||
Mutual Funds And Equity Securities Managed Or Administered By Wholly-Owned Subsidiaries | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Actual allocation | 32.60% | 28.20% | ||
Parent Company Common Stock | Common shares | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Actual allocation | 0.60% | 0.60% |
Employee benefit plans - Estima
Employee benefit plans - Estimated Future Contributions (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Pension plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Estimated Bank contributions for the full year ending December 31, 2019 | $ 2,500 |
Estimated benefit payments by year: | |
2,019 | 6,600 |
2,020 | 6,600 |
2,021 | 6,600 |
2,022 | 6,600 |
2,023 | 6,500 |
2024-2028 | 31,200 |
Post- retirement medical benefit plan | |
Defined Benefit Plan Disclosure [Line Items] | |
Estimated Bank contributions for the full year ending December 31, 2019 | 4,757 |
Estimated benefit payments by year: | |
2,019 | 4,757 |
2,020 | 5,076 |
2,021 | 5,415 |
2,022 | 5,743 |
2,023 | 6,073 |
2024-2028 | $ 34,865 |
Credit-related arrangements, _3
Credit-related arrangements, repurchase agreements and commitments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating leases, rent expense | $ 5,600 | $ 4,900 | $ 5,100 |
Sourcing | |||
2,019 | 14,721 | ||
2,020 | 13,353 | ||
2,021 | 11,112 | ||
2,022 | 0 | ||
2,023 | 0 | ||
2024 & thereafter | 0 | ||
Total commitments | 39,186 | 56,900 | |
Leases | |||
2,019 | 5,448 | ||
2,020 | 5,524 | ||
2,021 | 4,696 | ||
2,022 | 4,317 | ||
2,023 | 3,609 | ||
2024 & thereafter | 3,583 | ||
Total commitments | 27,177 | $ 16,500 | |
Other | |||
2,019 | 7,990 | ||
2,020 | 2,214 | ||
2,021 | 1,634 | ||
2,022 | 727 | ||
2,023 | 719 | ||
2024 & thereafter | 719 | ||
Total commitments | 14,003 | ||
Total | |||
2,019 | 28,159 | ||
2,020 | 21,091 | ||
2,021 | 17,442 | ||
2,022 | 5,044 | ||
2,023 | 4,328 | ||
2024 & thereafter | 4,302 | ||
Total commitments | $ 80,366 |
Credit-related arrangements, _4
Credit-related arrangements, repurchase agreements and commitments - Commitments (Details) $ in Thousands | Dec. 31, 2018USD ($)custodian | Dec. 31, 2017USD ($) |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Number of custodians | custodian | 1 | |
Commitments to extend credit | $ 445,215 | $ 602,740 |
Documentary and commercial letters of credit | 561 | 1,263 |
Total unfunded commitments to extend credit | $ 445,776 | 604,003 |
Custodian | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Right to set-off against securities held, percent of utilized facility | 110.00% | |
Commitments to extend credit | $ 200,000 | |
Custodian | Standby Letters of Credit | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to extend credit | $ 137,400 | $ 77,000 |
Credit-related arrangements, _5
Credit-related arrangements, repurchase agreements and commitments - Credit-Related Arrangements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Offsetting Liabilities [Line Items] | ||
Outstanding financial guarantees, Gross | $ 247,841 | $ 191,745 |
Outstanding financial guarantees, Collateral | 239,650 | 183,409 |
Outstanding financial guarantees, Net | $ 8,191 | 8,336 |
Standby Letters of Credit | ||
Offsetting Liabilities [Line Items] | ||
Guarantor obligations, term period | 1 year | |
Letters of Guarantee | ||
Offsetting Liabilities [Line Items] | ||
Guarantor obligations, term period | 4 years | |
Standby letters of credit | ||
Offsetting Liabilities [Line Items] | ||
Outstanding financial guarantees, Gross | $ 245,156 | 186,408 |
Outstanding financial guarantees, Collateral | 237,051 | 178,158 |
Outstanding financial guarantees, Net | 8,105 | 8,250 |
Letters of guarantee | ||
Offsetting Liabilities [Line Items] | ||
Outstanding financial guarantees, Gross | 2,685 | 5,337 |
Outstanding financial guarantees, Collateral | 2,599 | 5,251 |
Outstanding financial guarantees, Net | $ 86 | $ 86 |
Credit-related arrangements, _6
Credit-related arrangements, repurchase agreements and commitments - Repurchase Agreements (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)position | Dec. 31, 2017USD ($)position | |
Loss Contingencies [Line Items] | ||
Securities purchased under agreement to resell | $ 27,341 | $ 178,769 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises | ||
Loss Contingencies [Line Items] | ||
Resell agreements, number of open positions | position | 2 | 23 |
Resell agreements, maturity period (less than) | 30 days | |
Securities purchased under agreement to resell | $ 27,300 | $ 178,800 |
Credit-related arrangements, _7
Credit-related arrangements, repurchase agreements and commitments - Legal Proceedings (Details) - John Doe Summonses - Pending Litigation $ in Millions | 1 Months Ended | 12 Months Ended | |
Nov. 30, 2013institution | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Loss Contingencies [Line Items] | |||
Number of defendants | institution | 6 | ||
Loss contingency provision | $ | $ 5.5 | $ 5.5 |
Exit cost obligations (Details)
Exit cost obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | 36 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |||||
Expense recognized by year | $ 0 | $ 1,772 | $ 6,266 | ||
United Kingdom | Wind Down of Deposit Taking and Investment Management Business | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Expense recognized by year | 0 | $ 10,221 | |||
Expense recognized by year, Costs to be recognized in the future | 0 | ||||
Expense recognized by year, Total exit costs expected to be incurred | 10,221 | ||||
Amounts paid by year | 0 | 10,221 | |||
Exit cost liability | 0 | 0 | 0 | ||
United Kingdom | Staff redundancy expenses | Wind Down of Deposit Taking and Investment Management Business | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, amount expensed | $ 5,100 | ||||
Expense recognized by year | 0 | 3,680 | |||
Expense recognized by year, Costs to be recognized in the future | 0 | ||||
Expense recognized by year, Total exit costs expected to be incurred | 3,680 | ||||
Amounts paid by year | 0 | 3,680 | |||
Exit cost liability | 0 | 0 | 0 | ||
United Kingdom | Professional services | Wind Down of Deposit Taking and Investment Management Business | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Expense recognized by year | 0 | 4,388 | |||
Expense recognized by year, Costs to be recognized in the future | 0 | ||||
Expense recognized by year, Total exit costs expected to be incurred | 4,388 | ||||
Amounts paid by year | 0 | 4,388 | |||
Exit cost liability | 0 | 0 | 0 | ||
United Kingdom | Lease termination expenses | Wind Down of Deposit Taking and Investment Management Business | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Expense recognized by year | 0 | 649 | |||
Expense recognized by year, Costs to be recognized in the future | 0 | ||||
Expense recognized by year, Total exit costs expected to be incurred | 649 | ||||
Amounts paid by year | 0 | 649 | |||
Exit cost liability | 0 | 0 | 0 | ||
United Kingdom | Other expenses | Wind Down of Deposit Taking and Investment Management Business | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Expense recognized by year | 0 | 1,504 | |||
Expense recognized by year, Costs to be recognized in the future | 0 | ||||
Expense recognized by year, Total exit costs expected to be incurred | 1,504 | ||||
Amounts paid by year | 0 | 1,504 | |||
Exit cost liability | $ 0 | $ 0 | $ 0 |
Loan interest income (Details)
Loan interest income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Contractual interest | |||
Contractual interest earned on mortgages | $ 136,984 | $ 125,980 | $ 122,541 |
Contractual interest earned on other loans | 76,924 | 57,591 | 62,788 |
Subtotal contractual interest earned | 213,908 | 183,571 | 185,329 |
Amortization | |||
Amortization of fair value hedge | (501) | (722) | (1,120) |
Amortization of loan origination fees (net of amortized costs) | 5,088 | 4,171 | 3,791 |
Total loan interest income | 218,495 | 187,020 | 188,000 |
Balance of unamortized fair value hedge included in loans as at year end | 1,992 | 2,493 | 3,215 |
Balance of unamortized loan fees included in loans as at year end | $ 10,010 | $ 9,364 | $ 6,313 |
Segmented information (Details)
Segmented information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)segmentbranch | Dec. 31, 2017USD ($)segment | Dec. 31, 2016USD ($) | |
Segment Reporting [Abstract] | |||
Number of operating segments | segment | 3 | 6 | |
Segment Reporting Information [Line Items] | |||
Assets | $ 10,773,178 | $ 10,779,237 | |
Net interest income | 342,989 | 289,744 | $ 258,480 |
Provision for credit recoveries (losses) | 6,991 | 5,837 | (4,399) |
Non-interest income | 168,686 | 157,825 | 147,473 |
Revenue before gains and losses | 518,666 | 453,406 | 401,554 |
Gains and losses | (855) | 1,269 | 1,014 |
Total net revenue | 517,811 | 454,675 | 402,568 |
Total expenses | 322,627 | 301,423 | 286,626 |
Net income | 195,184 | 153,252 | 115,942 |
Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 342,989 | 289,744 | 258,480 |
Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 0 | 0 | 0 |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Assets | 11,089,397 | 10,895,882 | |
Provision for credit recoveries (losses) | 6,991 | 5,837 | (4,399) |
Non-interest income | 177,114 | 163,289 | 150,478 |
Revenue before gains and losses | 527,094 | 458,870 | 404,559 |
Gains and losses | (855) | 1,269 | 1,014 |
Total net revenue | 526,239 | 460,139 | 405,573 |
Total expenses | 331,055 | 306,887 | 289,631 |
Net income | 195,184 | 153,252 | 115,942 |
Operating Segments | Customer | Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 342,989 | 289,744 | 258,480 |
Operating Segments | Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | $ 0 | 0 | 0 |
Operating Segments | Bermuda | |||
Segment Reporting Information [Line Items] | |||
Number of branch locations | branch | 4 | ||
Assets | $ 5,387,347 | 6,053,546 | |
Provision for credit recoveries (losses) | 6,823 | 4,618 | (7,263) |
Non-interest income | 87,352 | 81,416 | 71,765 |
Revenue before gains and losses | 299,459 | 265,958 | 226,610 |
Gains and losses | (20) | 2,785 | 1,412 |
Total net revenue | 299,439 | 268,743 | 228,022 |
Total expenses | 202,318 | 192,293 | 164,581 |
Net income | 97,121 | 76,450 | 63,441 |
Operating Segments | Bermuda | Customer | Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 202,901 | 178,600 | 160,466 |
Operating Segments | Bermuda | Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | $ 2,383 | 1,324 | 1,642 |
Operating Segments | Cayman | |||
Segment Reporting Information [Line Items] | |||
Number of branch locations | branch | 3 | ||
Assets | $ 3,705,468 | 3,242,343 | |
Provision for credit recoveries (losses) | 1,297 | 1,033 | 2,135 |
Non-interest income | 47,781 | 46,004 | 41,364 |
Revenue before gains and losses | 152,287 | 133,114 | 123,531 |
Gains and losses | 349 | (28) | (532) |
Total net revenue | 152,636 | 133,086 | 122,999 |
Total expenses | 60,666 | 59,400 | 60,613 |
Net income | 91,970 | 73,686 | 62,386 |
Operating Segments | Cayman | Customer | Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 102,793 | 86,074 | 79,644 |
Operating Segments | Cayman | Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 416 | 3 | 388 |
Operating Segments | Channel Islands and the UK | |||
Segment Reporting Information [Line Items] | |||
Assets | 1,966,547 | 1,586,134 | |
Provision for credit recoveries (losses) | (1,129) | 186 | 729 |
Non-interest income | 26,824 | 24,445 | 28,155 |
Revenue before gains and losses | 60,172 | 48,242 | 45,107 |
Gains and losses | (1,185) | (1,488) | 134 |
Total net revenue | 58,987 | 46,754 | 45,241 |
Total expenses | 50,353 | 43,758 | 55,387 |
Net income | 8,634 | 2,996 | (10,146) |
Operating Segments | Channel Islands and the UK | Customer | Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 37,276 | 24,978 | 18,283 |
Operating Segments | Channel Islands and the UK | Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | (2,799) | (1,367) | (2,060) |
Operating Segments | Other | |||
Segment Reporting Information [Line Items] | |||
Assets | 30,035 | 13,859 | |
Provision for credit recoveries (losses) | 0 | 0 | 0 |
Non-interest income | 15,157 | 11,424 | 9,194 |
Revenue before gains and losses | 15,176 | 11,556 | 9,311 |
Gains and losses | 1 | 0 | 0 |
Total net revenue | 15,177 | 11,556 | 9,311 |
Total expenses | 17,718 | 11,436 | 9,050 |
Net income | (2,541) | 120 | 261 |
Operating Segments | Other | Customer | Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 19 | 92 | 87 |
Operating Segments | Other | Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 0 | 40 | 30 |
Inter-segment eliminations | |||
Segment Reporting Information [Line Items] | |||
Assets | (316,219) | (116,645) | |
Provision for credit recoveries (losses) | 0 | 0 | 0 |
Non-interest income | (8,428) | (5,464) | (3,005) |
Revenue before gains and losses | (8,428) | (5,464) | (3,005) |
Gains and losses | 0 | 0 | 0 |
Total net revenue | (8,428) | (5,464) | (3,005) |
Total expenses | (8,428) | (5,464) | (3,005) |
Net income | 0 | 0 | 0 |
Inter-segment eliminations | Customer | |||
Segment Reporting Information [Line Items] | |||
Net interest income | 0 | 0 | 0 |
Inter-segment eliminations | Customer | Inter- segment | |||
Segment Reporting Information [Line Items] | |||
Net interest income | $ 0 | $ 0 | $ 0 |
Derivative instruments and ri_3
Derivative instruments and risk management (Details) $ in Thousands, € in Millions, SFr in Millions | Dec. 31, 2018USD ($)contract | Dec. 31, 2018EUR (€)contract | Dec. 31, 2018SGD ($)contract | Dec. 31, 2018CHF (SFr)contract | Dec. 31, 2017USD ($)contract | Dec. 31, 2017EUR (€)contract | Dec. 31, 2017SGD ($)contract | Dec. 31, 2017CHF (SFr)contract |
Derivatives, Fair Value [Line Items] | ||||||||
Number of contracts | contract | ||||||||
Notional amounts | $ 2,303,572 | $ 2,313,943 | ||||||
Gross positive fair value | 13,600 | 11,321 | ||||||
Gross negative fair value | (13,272) | (12,665) | ||||||
Net fair value | $ 328 | $ (1,344) | ||||||
Currency swaps | Not Designated as Hedging Instrument | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Number of contracts | contract | 8 | 8 | 8 | 8 | 8 | 8 | 8 | 8 |
Notional amounts | $ 238,810 | $ 183,719 | ||||||
Gross positive fair value | 269 | 726 | ||||||
Gross negative fair value | (601) | (2,754) | ||||||
Net fair value | $ (332) | $ (2,028) | ||||||
Spot and forward foreign exchange | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Number of contracts | contract | 288 | 288 | 288 | 288 | 120 | 120 | 120 | 120 |
Notional amounts | $ 2,064,762 | $ 2,130,224 | ||||||
Gross positive fair value | 13,331 | 10,595 | ||||||
Gross negative fair value | (12,671) | (9,911) | ||||||
Net fair value | $ 660 | $ 684 | ||||||
Foreign Exchange Contract | Designated as Hedging Instrument | Net investment hedges | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Foreign deposits | € 124.5 | $ 4,000,000 | SFr 0.4 | € 84.5 | $ 0 | SFr 0.4 |
Derivative instruments and ri_4
Derivative instruments and risk management - Offsetting (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Derivative assets | ||
Gross fair value recognized | $ 13,600 | $ 11,321 |
Less: offset applied under master netting agreements | (2,036) | (2,197) |
Net fair value presented in the consolidated balance sheets | 11,564 | 9,124 |
Positions not offset in the consolidated balance sheets, Gross fair value of derivatives | 0 | 0 |
Positions not offset in the consolidated balance sheets, Cash collateral received/paid | (3,216) | (6,196) |
Net exposures | 8,348 | 2,928 |
Derivative liabilities | ||
Gross fair value recognized | 13,272 | 12,665 |
Less: offset applied under master netting agreements | (2,036) | (2,197) |
Net fair value presented in the consolidated balance sheets | 11,236 | 10,468 |
Positions not offset in the consolidated balance sheets, Gross fair value of derivatives | 0 | 0 |
Positions not offset in the consolidated balance sheets, Cash collateral received/paid | (1,861) | 0 |
Net exposures | 9,375 | 10,468 |
Net fair value | $ 328 | $ (1,344) |
Derivative instruments and ri_5
Derivative instruments and risk management - Location and Amount of Gains (Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total net gains (losses) recognized in net income | $ 1,672 | $ (15,709) | $ 1,297 |
Total net gains (losses) recognized in comprehensive income | 0 | (4,410) | 12,713 |
Spot and forward foreign exchange | Foreign exchange revenue | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total net gains (losses) recognized in net income | (25) | 541 | (322) |
Currency swaps | Designated as Hedging Instrument | Net change in unrealized gains and (losses) on translation of net investment in foreign operations | Net investment hedges | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total net gains (losses) recognized in comprehensive income | 0 | (4,410) | 12,713 |
Currency swaps | Foreign exchange revenue | Not Designated as Hedging Instrument | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total net gains (losses) recognized in net income | 1,697 | (4,916) | 2,710 |
Currency swaps | Foreign exchange revenue | Designated as Hedging Instrument | Net investment hedges | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total net gains (losses) recognized in net income | $ 0 | $ (11,334) | $ (1,091) |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financial assets | ||
Trading | $ 6,495 | $ 6,824 |
Available-for-sale investments | 2,182,749 | 3,317,440 |
Other assets - Derivatives | 11,564 | 9,124 |
Financial liabilities | ||
Other liabilities - Derivatives | 11,236 | 10,468 |
Fair Value, Measurements, Recurring | ||
Financial assets | ||
Trading | 6,495 | 6,824 |
Available-for-sale investments | 2,182,749 | 3,317,440 |
Other assets - Derivatives | 11,564 | 9,124 |
Financial liabilities | ||
Other liabilities - Derivatives | 11,236 | 10,468 |
Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Trading | 6,176 | 6,616 |
Available-for-sale investments | 0 | 0 |
Other assets - Derivatives | 0 | 0 |
Financial liabilities | ||
Other liabilities - Derivatives | 0 | 0 |
Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Trading | 319 | 208 |
Available-for-sale investments | 2,170,123 | 3,304,947 |
Other assets - Derivatives | 11,564 | 9,124 |
Financial liabilities | ||
Other liabilities - Derivatives | 11,236 | 10,468 |
Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Trading | 0 | 0 |
Available-for-sale investments | 12,626 | 12,493 |
Other assets - Derivatives | 0 | 0 |
Financial liabilities | ||
Other liabilities - Derivatives | 0 | 0 |
Mutual funds | ||
Financial assets | ||
Trading | 6,495 | 6,824 |
Mutual funds | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Trading | 6,495 | 6,824 |
Mutual funds | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Trading | 6,176 | 6,616 |
Mutual funds | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Trading | 319 | 208 |
Mutual funds | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Trading | 0 | 0 |
US government and federal agencies | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Available-for-sale investments | 1,786,507 | 2,709,104 |
US government and federal agencies | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
US government and federal agencies | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Available-for-sale investments | 1,786,507 | 2,709,104 |
US government and federal agencies | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Non-US governments debt securities | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Available-for-sale investments | 25,425 | 26,248 |
Non-US governments debt securities | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Non-US governments debt securities | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Available-for-sale investments | 25,425 | 26,248 |
Non-US governments debt securities | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Corporate debt securities | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Available-for-sale investments | 78,713 | 243,372 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Available-for-sale investments | 78,713 | 243,372 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Asset-backed securities - Student loans | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Available-for-sale investments | 12,626 | 12,493 |
Asset-backed securities - Student loans | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Asset-backed securities - Student loans | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Asset-backed securities - Student loans | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Available-for-sale investments | 12,626 | 12,493 |
Commercial mortgage-backed securities | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Available-for-sale investments | 123,209 | 141,500 |
Commercial mortgage-backed securities | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Commercial mortgage-backed securities | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Available-for-sale investments | 123,209 | 141,500 |
Commercial mortgage-backed securities | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Residential mortgage-backed securities | Fair Value, Measurements, Recurring | ||
Financial assets | ||
Available-for-sale investments | 156,269 | 184,723 |
Residential mortgage-backed securities | Fair Value, Measurements, Recurring | Level 1 | ||
Financial assets | ||
Available-for-sale investments | 0 | 0 |
Residential mortgage-backed securities | Fair Value, Measurements, Recurring | Level 2 | ||
Financial assets | ||
Available-for-sale investments | 156,269 | 184,723 |
Residential mortgage-backed securities | Fair Value, Measurements, Recurring | Level 3 | ||
Financial assets | ||
Available-for-sale investments | $ 0 | $ 0 |
Fair value measurements - Level
Fair value measurements - Level 3 Reconciliation (Details) - Unrealized gains (losses) on AFS investments - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Carrying amount at beginning of year | $ 12,493 | $ 12,493 | $ 12,161 |
Realized and unrealized gains (losses) recognized in other comprehensive income | 133 | 0 | 332 |
Carrying amount at end of year | $ 12,626 | $ 12,493 | $ 12,493 |
Fair value measurements - Items
Fair value measurements - Items Other Than Those Recognized at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financial assets | ||
Short-term investments | $ 52,336 | $ 249,984 |
Investments held-to-maturity | 2,036,214 | 1,377,354 |
Other real estate owned | 5,346 | 9,127 |
Carrying amount | Nonrecurring | Level 1 | ||
Financial assets | ||
Cash due from banks | 2,053,883 | 1,535,138 |
Short-term investments | 52,336 | 249,984 |
Carrying amount | Nonrecurring | Level 2 | ||
Financial assets | ||
Securities purchased under agreement to resell | 27,341 | 178,769 |
Investments held-to-maturity | 2,066,120 | 1,381,955 |
Loans, net of allowance for credit losses | 4,043,889 | 3,776,862 |
Other real estate owned | 5,346 | 9,127 |
Financial liabilities | ||
Long-term debt | 143,322 | 117,000 |
Carrying amount | Nonrecurring | Level 2 | Banks | ||
Financial liabilities | ||
Payable on demand | 33,822 | 12,466 |
Carrying amount | Nonrecurring | Level 2 | Demand deposits | Customers | ||
Financial liabilities | ||
Payable on demand | 7,449,843 | 7,813,654 |
Carrying amount | Nonrecurring | Level 2 | Term deposits | Customers | ||
Financial liabilities | ||
Payable on demand | 1,968,576 | 1,710,338 |
Fair value | Nonrecurring | Level 1 | ||
Financial assets | ||
Cash due from banks | 2,053,883 | 1,535,138 |
Short-term investments | 52,336 | 249,984 |
Fair value | Nonrecurring | Level 2 | ||
Financial assets | ||
Securities purchased under agreement to resell | 27,341 | 178,769 |
Investments held-to-maturity | 2,036,214 | 1,377,354 |
Loans, net of allowance for credit losses | 4,047,262 | 3,770,450 |
Other real estate owned | 5,346 | 9,127 |
Financial liabilities | ||
Long-term debt | 146,261 | 118,321 |
Fair value | Nonrecurring | Level 2 | Banks | ||
Financial liabilities | ||
Payable on demand | 33,822 | 12,466 |
Fair value | Nonrecurring | Level 2 | Demand deposits | Customers | ||
Financial liabilities | ||
Payable on demand | 7,449,843 | 7,813,654 |
Fair value | Nonrecurring | Level 2 | Term deposits | Customers | ||
Financial liabilities | ||
Payable on demand | 1,970,004 | 1,710,223 |
Appreciation / (depreciation) | Nonrecurring | Level 1 | ||
Financial assets | ||
Cash due from banks | 0 | 0 |
Short-term investments | 0 | 0 |
Appreciation / (depreciation) | Nonrecurring | Level 2 | ||
Financial assets | ||
Securities purchased under agreement to resell | 0 | 0 |
Investments held-to-maturity | (29,906) | (4,601) |
Loans, net of allowance for credit losses | 3,373 | (6,412) |
Other real estate owned | 0 | 0 |
Financial liabilities | ||
Long-term debt | (2,939) | (1,321) |
Appreciation / (depreciation) | Nonrecurring | Level 2 | Banks | ||
Financial liabilities | ||
Payable on demand | 0 | 0 |
Appreciation / (depreciation) | Nonrecurring | Level 2 | Demand deposits | Customers | ||
Financial liabilities | ||
Payable on demand | 0 | 0 |
Appreciation / (depreciation) | Nonrecurring | Level 2 | Term deposits | Customers | ||
Financial liabilities | ||
Payable on demand | $ (1,428) | $ 115 |
Interest rate risk (Details)
Interest rate risk (Details) - Fair Value, Concentration of Risk, Market Risk Management, Gap Analysis - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Cash due from banks | $ 2,054 | $ 1,535 |
Securities purchased under agreement to resell | 27 | 179 |
Short-term investments | 52 | 250 |
Investments | 4,255 | 4,706 |
Loans | 4,044 | 3,777 |
Other assets | 341 | 332 |
Total assets | 10,773 | 10,779 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 882 | 823 |
Demand deposits | 7,477 | 7,822 |
Term deposits | 1,975 | 1,714 |
Other liabilities | 296 | 303 |
Long-term debt | 143 | 117 |
Total liabilities and shareholders' equity | 10,773 | 10,779 |
Interest rate sensitivity gap | 0 | 0 |
Cumulative interest rate sensitivity gap | 0 | 0 |
Interest Bearing Funds | Within 3 months | ||
Assets | ||
Cash due from banks | 1,930 | 1,446 |
Securities purchased under agreement to resell | 27 | 179 |
Short-term investments | 40 | 163 |
Investments | 488 | 1,464 |
Loans | 3,160 | 3,457 |
Other assets | 0 | 0 |
Total assets | 5,645 | 6,709 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 0 | 0 |
Demand deposits | 5,357 | 5,342 |
Term deposits | 1,245 | 1,340 |
Other liabilities | 0 | 0 |
Long-term debt | 70 | 92 |
Total liabilities and shareholders' equity | 6,672 | 6,774 |
Interest rate sensitivity gap | (1,027) | (65) |
Cumulative interest rate sensitivity gap | (1,027) | (65) |
Interest Bearing Funds | 3 to 6 months | ||
Assets | ||
Cash due from banks | 0 | 0 |
Securities purchased under agreement to resell | 0 | 0 |
Short-term investments | 10 | 87 |
Investments | 35 | 62 |
Loans | 278 | 44 |
Other assets | 0 | 0 |
Total assets | 323 | 193 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 0 | 0 |
Demand deposits | 0 | 0 |
Term deposits | 228 | 132 |
Other liabilities | 0 | 0 |
Long-term debt | 0 | 25 |
Total liabilities and shareholders' equity | 228 | 157 |
Interest rate sensitivity gap | 95 | 36 |
Cumulative interest rate sensitivity gap | (932) | (29) |
Interest Bearing Funds | 6 to 12 months | ||
Assets | ||
Cash due from banks | 0 | 0 |
Securities purchased under agreement to resell | 0 | 0 |
Short-term investments | 0 | 0 |
Investments | 8 | 15 |
Loans | 38 | 34 |
Other assets | 0 | 0 |
Total assets | 46 | 49 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 0 | 0 |
Demand deposits | 0 | 0 |
Term deposits | 432 | 183 |
Other liabilities | 0 | 0 |
Long-term debt | 0 | 0 |
Total liabilities and shareholders' equity | 432 | 183 |
Interest rate sensitivity gap | (386) | (134) |
Cumulative interest rate sensitivity gap | (1,318) | (163) |
Interest Bearing Funds | 1 to 5 years | ||
Assets | ||
Cash due from banks | 0 | 0 |
Securities purchased under agreement to resell | 0 | 0 |
Short-term investments | 0 | 0 |
Investments | 245 | 390 |
Loans | 223 | 194 |
Other assets | 0 | 0 |
Total assets | 468 | 584 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 0 | 0 |
Demand deposits | 0 | 0 |
Term deposits | 70 | 59 |
Other liabilities | 0 | 0 |
Long-term debt | 73 | 0 |
Total liabilities and shareholders' equity | 143 | 59 |
Interest rate sensitivity gap | 325 | 525 |
Cumulative interest rate sensitivity gap | (993) | 362 |
Interest Bearing Funds | After 5 years | ||
Assets | ||
Cash due from banks | 0 | 0 |
Securities purchased under agreement to resell | 0 | 0 |
Short-term investments | 0 | 0 |
Investments | 3,473 | 2,768 |
Loans | 330 | 44 |
Other assets | 0 | 0 |
Total assets | 3,803 | 2,812 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 0 | 0 |
Demand deposits | 0 | 0 |
Term deposits | 0 | 0 |
Other liabilities | 0 | 0 |
Long-term debt | 0 | 0 |
Total liabilities and shareholders' equity | 0 | 0 |
Interest rate sensitivity gap | 3,803 | 2,812 |
Cumulative interest rate sensitivity gap | 2,810 | 3,174 |
Non-interest bearing funds | ||
Assets | ||
Cash due from banks | 124 | 89 |
Securities purchased under agreement to resell | 0 | 0 |
Short-term investments | 2 | 0 |
Investments | 6 | 7 |
Loans | 15 | 4 |
Other assets | 341 | 332 |
Total assets | 488 | 432 |
Liabilities and shareholders' equity | ||
Shareholders’ equity | 882 | 823 |
Demand deposits | 2,120 | 2,480 |
Term deposits | 0 | 0 |
Other liabilities | 296 | 303 |
Long-term debt | 0 | 0 |
Total liabilities and shareholders' equity | 3,298 | 3,606 |
Interest rate sensitivity gap | (2,810) | (3,174) |
Cumulative interest rate sensitivity gap | $ 0 | $ 0 |
Long-term debt (Details)
Long-term debt (Details) | May 24, 2018USD ($) | May 27, 2008USD ($)tranche | Jun. 27, 2005USD ($)tranche | May 28, 2003USD ($)tranche | May 31, 2013 | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | May 31, 2018USD ($) | Jan. 31, 2014USD ($) |
Debt Instrument [Line Items] | ||||||||||
Interest costs capitalized | $ 0 | $ 0 | $ 0 | |||||||
Subordinated Lower Tier II Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 78,000,000 | $ 150,000,000 | $ 125,000,000 | |||||||
Number of tranches | tranche | 2 | 2 | 2 | |||||||
Subordinated Lower Tier II Debt | Senior A Notes Due 2013 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 78,000,000 | |||||||||
Fixed interest rate | 3.94% | |||||||||
Subordinated Lower Tier II Debt | Series B Notes Due 2018 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 47,000,000 | |||||||||
Repayments of debt | $ 47,000,000 | |||||||||
Fixed interest rate | 5.15% | |||||||||
Repurchased face amount | $ 47,000,000 | |||||||||
Subordinated Lower Tier II Debt | Series B Notes Due 2018 | 10-Year US Treasury Yield | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 1.35% | |||||||||
Subordinated Lower Tier II Debt | Notes Redeemed in July 2003 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayments of debt | $ 75,000,000 | |||||||||
Subordinated Lower Tier II Debt | Series A Notes Due 2015 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 90,000,000 | |||||||||
Fixed interest rate | 4.81% | |||||||||
Subordinated Lower Tier II Debt | Series A Notes Due 2015 | Five-Year US Treasury Yield | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 1.00% | |||||||||
Subordinated Lower Tier II Debt | Series B Notes Due 2020 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 60,000,000 | |||||||||
Fixed interest rate | 5.11% | 5.11% | ||||||||
Subordinated Lower Tier II Debt | Series B Notes Due 2020 | 10-Year US Treasury Yield | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 1.10% | |||||||||
Subordinated Lower Tier II Debt | 2005 Series B Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayments of debt | $ 13,875,000 | |||||||||
Fixed interest rate | 5.11% | |||||||||
Repurchased face amount | $ 15,000,000 | |||||||||
Gain (loss) on repurchase of debt instrument | $ 1,125,000 | |||||||||
Subordinated Lower Tier II Debt | 2005 Series A | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repurchased face amount | $ 90,000,000 | |||||||||
Subordinated Lower Tier II Debt | Series A Notes Due 2018 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 53,000,000 | |||||||||
Fixed interest rate | 7.59% | |||||||||
Subordinated Lower Tier II Debt | Series B Notes Due 2023 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 25,000,000 | |||||||||
Fixed interest rate | 8.44% | 8.44% | ||||||||
Subordinated Lower Tier II Debt | Series B Notes Due 2023 | 10-Year US Treasury Yield | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 4.51% | |||||||||
Subordinated Lower Tier II Debt | Notes Redeemed in May 2008 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayments of debt | $ 78,000,000 | |||||||||
Subordinated Lower Tier II Debt | Notes Due 2028 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | $ 75,000,000 | |||||||||
Fixed interest rate | 5.25% | 5.25% | ||||||||
Payments of debt issuance costs | $ 1,800,000 | |||||||||
Subordinated Lower Tier II Debt | Notes Due 2028 | 10-Year US Treasury Yield | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 2.27% |
Long-term debt - Contractual Ma
Long-term debt - Contractual Maturity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | May 24, 2018 | Dec. 31, 2017 | May 31, 2013 | Jun. 27, 2005 | |
Debt Instrument [Line Items] | |||||
Long-term debt less unamortized debt issuance costs | $ 143,322 | $ 117,000 | |||
Subordinated Lower Tier II Debt | |||||
Debt Instrument [Line Items] | |||||
Principal Outstanding | 145,000 | ||||
Interest payments until contractual maturity, Within 1 year | 7,953 | ||||
Interest payments until contractual maturity, 1 to 5 years | 24,114 | ||||
Interest payments until contractual maturity, After 5 years | 17,340 | ||||
Unamortized debt issuance costs | (1,678) | ||||
Long-term debt less unamortized debt issuance costs | $ 143,322 | ||||
Subordinated Lower Tier II Debt | Series B Notes Due 2020 | |||||
Debt Instrument [Line Items] | |||||
Interest rate until date redeemable | 5.11% | 5.11% | |||
Principal Outstanding | $ 45,000 | ||||
Interest payments until contractual maturity, Within 1 year | 2,054 | ||||
Interest payments until contractual maturity, 1 to 5 years | 1,542 | ||||
Interest payments until contractual maturity, After 5 years | $ 0 | ||||
Subordinated Lower Tier II Debt | Series B Notes Due 2020 | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Interest rate from earliest date redeemable to contractual maturity, basis spread on variable rate | 1.695% | ||||
Subordinated Lower Tier II Debt | Series B Notes Due 2023 | |||||
Debt Instrument [Line Items] | |||||
Interest rate until date redeemable | 8.44% | 8.44% | |||
Principal Outstanding | $ 25,000 | ||||
Interest payments until contractual maturity, Within 1 year | 1,961 | ||||
Interest payments until contractual maturity, 1 to 5 years | 6,861 | ||||
Interest payments until contractual maturity, After 5 years | $ 0 | ||||
Subordinated Lower Tier II Debt | Series B Notes Due 2023 | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Interest rate from earliest date redeemable to contractual maturity, basis spread on variable rate | 4.929% | ||||
Subordinated Lower Tier II Debt | Notes Due 2028 | |||||
Debt Instrument [Line Items] | |||||
Interest rate until date redeemable | 5.25% | 5.25% | |||
Principal Outstanding | $ 75,000 | ||||
Interest payments until contractual maturity, Within 1 year | 3,938 | ||||
Interest payments until contractual maturity, 1 to 5 years | 15,711 | ||||
Interest payments until contractual maturity, After 5 years | $ 17,340 | ||||
Subordinated Lower Tier II Debt | Notes Due 2028 | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Interest rate from earliest date redeemable to contractual maturity, basis spread on variable rate | 2.255% |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 22, 2009 | |
Class of Stock [Line Items] | ||||
Options outstanding (in shares) | 300 | 900 | 2,600 | |
Average number of outstanding awards of unvested shares (in shares) | 900 | 900 | 800 | |
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 430 | |||
Antidilutive securities excluded from computation of earnings per share, exercise price (in dollars per share) | $ 34.72 | |||
Net income | $ 195,184 | $ 153,252 | $ 115,942 | |
Less: Preference dividends declared and guarantee fee | 0 | 0 | (15,655) | |
Premium paid on repurchase of preference shares | 0 | 0 | (41,913) | |
Net income attributable to common shareholders | $ 195,184 | $ 153,252 | $ 58,374 | |
Basic Earnings Per Share | ||||
Basic Earnings Per Share (in dollars per share) | $ 3.55 | $ 2.82 | $ 1.20 | |
Diluted Earnings Per Share | ||||
Diluted Earnings Per Share (in dollars per share) | $ 3.50 | $ 2.76 | 1.18 | |
Common shares | ||||
Class of Stock [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, exercise price (in dollars per share) | $ 34.72 | $ 70.10 | ||
Basic Earnings Per Share | ||||
Weighted average number of common shares issued (in shares) | 55,159 | 54,296 | 49,128 | |
Weighted average number of common shares held as treasury stock (in shares) | (213) | 0 | (506) | |
Weighted average number of participating shares (in shares) | 54,946 | 54,296 | 48,622 | |
Basic Earnings Per Share (in dollars per share) | $ 3.55 | $ 2.82 | $ 1.20 | |
Diluted Earnings Per Share | ||||
Weighted average number of common shares (in shares) | 54,946 | 54,296 | 48,622 | |
Net dilution impact related to options to purchase common shares (in shares) | 223 | 561 | 607 | |
Net dilution impact related to awards of unvested common shares (in shares) | 576 | 594 | 382 | |
Weighted average number of diluted common shares (in shares) | 55,745 | 55,451 | 49,611 | |
Diluted Earnings Per Share (in dollars per share) | $ 3.50 | $ 2.76 | $ 1.18 |
Share-based payments (Details)
Share-based payments (Details) | Mar. 01, 2010shares | Dec. 31, 2018USD ($)$ / shares | Dec. 31, 2017$ / shares | Dec. 31, 2016$ / sharesshares | Dec. 31, 2010conditionshares | Dec. 31, 2018 | Sep. 21, 2016$ / shares | Dec. 31, 2012shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Tax benefit from compensation expense | $ | $ 0 | |||||||
2010 Stock Option Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized (in shares) | 7,500,000 | 2,950,000 | 5,000,000 | |||||
2010 Stock Option Plan | Employee Stock Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percent of diluted common shares initially available for grant | 5.00% | |||||||
Number of shares issued upon exercise of each option (in shares) | 1 | |||||||
Expiration period | 10 years | |||||||
Number of vesting conditions | condition | 2 | |||||||
2010 Stock Option Plan | Time Vesting Employee Stock Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Expiration period | 90 days | |||||||
Percent of option award granted, time vested | 50.00% | |||||||
2010 Stock Option Plan | Time Vesting Employee Stock Option | Share-based Compensation Award, Tranche One | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
2010 Stock Option Plan | Performance Vesting Employee Stock Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percent of option award granted, performance vesting | 50.00% | |||||||
Valuation event, percent of total common shares transferred | 5.00% | |||||||
Multiple of invested capital (more than) | 200.00% | |||||||
Original capital invested (in dollars per share) | $ / shares | $ 12.09 | |||||||
1997 Stock Option Plan | Employee Stock Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares issued upon exercise of each option (in shares) | 1 | |||||||
Award vesting period | 4 years | |||||||
1997 Stock Option Plan | Employee Stock Option | Share-based Compensation Award, Tranche One | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
1997 Stock Option Plan | Employee Stock Option | Share-based Compensation Award, Tranche Two | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
1997 Stock Option Plan | Employee Stock Option | Share-based Compensation Award, Tranche Three | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
1997 Stock Option Plan | Employee Stock Option | Share-based Compensation Award, Tranche Four | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
1997 Stock Option Plan | Time Vesting Employee Stock Option | Share-based Compensation Award, Tranche Two | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
1997 Stock Option Plan | Time Vesting Employee Stock Option | Share-based Compensation Award, Tranche Three | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
1997 Stock Option Plan | Time Vesting Employee Stock Option | Share-based Compensation Award, Tranche Four | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting rights, percentage | 25.00% | |||||||
EDIP | Time Vesting Shares | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 3 years | |||||||
2010 Omnibus Plan and Employee Stock Options | Stock Compensation Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Weighted average fair value of stock options granted (in dollars per share) | $ / shares | $ 39.25 | $ 31.13 | $ 19.34 | |||||
2016, 2015, 2014, 2013 ELTIP | Time Vesting Shares | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 3 years | |||||||
2016, 2015, 2014, 2013 ELTIP | Performance Shares | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Award vesting period | 3 years |
Share-based payments - Changes
Share-based payments - Changes in Outstanding Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Number of shares transferable upon exercise | |||
Outstanding at beginning of year (in shares) | 534,000 | 2,066,000 | 2,826,000 |
Exercised (in shares) | (287,000) | (1,474,000) | (625,000) |
Forfeitures and cancellations (in shares) | (33,000) | (58,000) | (107,000) |
Resignations (in shares) | (28,000) | ||
Outstanding at end of year (in shares) | 214,000 | 534,000 | 2,066,000 |
Vested and exercisable at end of year (in shares) | 214,000 | 534,000 | 2,066,000 |
Additional Disclosures | |||
Aggregate intrinsic value, Exercised | $ 10,172 | $ 32,333 | $ 8,938 |
Aggregate intrinsic value, Outstanding at end of year | $ 3,665 | $ 11,700 | $ 38,489 |
1997 Stock Option Plan | |||
Number of shares transferable upon exercise | |||
Outstanding at beginning of year (in shares) | 58,000 | 116,000 | 218,000 |
Exercised (in shares) | 0 | 0 | 0 |
Forfeitures and cancellations (in shares) | (33,000) | (58,000) | (102,000) |
Resignations (in shares) | 0 | ||
Outstanding at end of year (in shares) | 25,000 | 58,000 | 116,000 |
Vested and exercisable at end of year (in shares) | 25,000 | 58,000 | 116,000 |
Weighted average exercise price | |||
Outstanding at beginning of year (in dollars per share) | $ 113.46 | $ 132.13 | $ 135.19 |
Exercised (in dollars per share) | 0 | 0 | 0 |
Forfeitures and cancellations (in dollars per share) | 150.46 | 151.20 | 138.79 |
Resignations, retirements, redundancies (in dollars per share) | 0 | ||
Outstanding at end of year (in dollars per share) | 64.51 | 113.46 | 132.13 |
Vested and exercisable at end of year (in dollars per share) | $ 64.51 | $ 113.46 | $ 132.13 |
Additional Disclosures | |||
Weighted average remaining life, Outstanding at end of year | 2 months 11 days | 7 months 17 days | 1 year 2 months 5 days |
Weighted average remaining life, Vested and exercisable at end of year | 2 months 11 days | 7 months 17 days | 1 year 2 months 5 days |
2010 Stock Option Plan | |||
Number of shares transferable upon exercise | |||
Outstanding at beginning of year (in shares) | 476,000 | 1,950,000 | 2,608,000 |
Exercised (in shares) | (287,000) | (1,474,000) | (625,000) |
Forfeitures and cancellations (in shares) | 0 | 0 | (5,000) |
Resignations (in shares) | (28,000) | ||
Outstanding at end of year (in shares) | 189,000 | 476,000 | 1,950,000 |
Vested and exercisable at end of year (in shares) | 189,000 | 476,000 | 1,950,000 |
Weighted average exercise price | |||
Outstanding at beginning of year (in dollars per share) | $ 11.73 | $ 11.57 | $ 11.60 |
Exercised (in dollars per share) | 11.56 | 11.51 | 11.68 |
Forfeitures and cancellations (in dollars per share) | 0 | 0 | 11.50 |
Resignations, retirements, redundancies (in dollars per share) | 11.50 | ||
Outstanding at end of year (in dollars per share) | 11.98 | 11.73 | 11.57 |
Vested and exercisable at end of year (in dollars per share) | $ 11.98 | $ 11.73 | $ 11.57 |
Additional Disclosures | |||
Weighted average remaining life, Outstanding at end of year | 1 year 7 months 30 days | 2 years 5 months 23 days | 3 years 5 months 1 day |
Weighted average remaining life, Vested and exercisable at end of year | 1 year 7 months 30 days | 2 years 5 months 23 days | 3 years 5 months 1 day |
Share-based payments - Change_2
Share-based payments - Changes in Outstanding ELTIP and EDIP Awards (Details) - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
EDIP | Time Vesting Shares | |||
Changes in Outstanding ELTIP and EDIP Awards | |||
Outstanding at beginning of year (in shares) | 244 | 215 | 226 |
Granted (in shares) | 130 | 132 | 115 |
Vested (fair value in 2017: $10.2 million, 2016: $7.0 million, 2015: $10.6 million) (in shares) | (138) | (102) | (118) |
Resignations, retirements, redundancies (in shares) | (2) | (1) | (8) |
Outstanding at end of year (in shares) | 234 | 244 | 215 |
ELTIP | Time Vesting Shares and Performance Shares | |||
Changes in Outstanding ELTIP and EDIP Awards | |||
Outstanding at beginning of year (in shares) | 679 | 640 | 606 |
Granted (in shares) | 241 | 236 | 360 |
Vested (fair value in 2017: $10.2 million, 2016: $7.0 million, 2015: $10.6 million) (in shares) | (220) | (196) | (302) |
Resignations, retirements, redundancies (in shares) | (3) | (1) | (24) |
Outstanding at end of year (in shares) | 697 | 679 | 640 |
EDIP and ELTIP | |||
Changes in Outstanding ELTIP and EDIP Awards | |||
Fair value of awards vested | $ 10.2 | $ 7 | $ 10.6 |
Share-based payments - Share-ba
Share-based payments - Share-based Compensation Cost Recognized in Net Income (Details) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Cost recognized in net income | $ 11,664 | $ 8,110 | $ 14,072 |
Stock option plans | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Cost recognized in net income | 0 | 0 | 8,697 |
EDIP and ELTIP | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Cost recognized in net income | $ 11,664 | $ 8,110 | $ 5,375 |
Share-based payments - Unrecogn
Share-based payments - Unrecognized Share-based Compensation Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Unrecognized Share-based Compensation Cost | ||
Total unrecognized expense | $ 14,068 | $ 11,765 |
EDIP | Time Vesting Shares | ||
Unrecognized Share-based Compensation Cost | ||
Unrecognized cost | $ 4,442 | $ 3,453 |
Weighted average years over which it is expected to be recognized | 1 year 8 months 24 days | 1 year 10 months 6 days |
ELTIP | Time Vesting Shares | ||
Unrecognized Share-based Compensation Cost | ||
Unrecognized cost | $ 1,746 | $ 3,302 |
Weighted average years over which it is expected to be recognized | 1 year 10 days | 1 year 10 months 21 days |
ELTIP | Performance Shares | ||
Unrecognized Share-based Compensation Cost | ||
Unrecognized cost | $ 7,880 | $ 5,010 |
Weighted average years over which it is expected to be recognized | 1 year 10 months 5 days | 1 year 9 months 11 days |
Share buy-back plans (Details)
Share buy-back plans (Details) | May 01, 2012programme | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 06, 2018shares | Feb. 15, 2018shares | Feb. 19, 2016shares |
Class of Stock [Line Items] | ||||||||||
Number of programs authorized | programme | 2 | |||||||||
Period in force | 12 months | |||||||||
2016 Common Share Buy-Back Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Number of shares authorized to be repurchased (up to) (in shares) | 800,000 | |||||||||
2018 Common Share Buy-Back Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Number of shares authorized to be repurchased (up to) (in shares) | 2,500,000 | 1,000,000 | ||||||||
Common Share Buy-Back Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Acquired number of shares (in shares) | 1,254,212 | 0 | 97,053 | 250,371 | 856,734 | 2,458,370 | ||||
Average cost per share (in dollars per share) | $ / shares | $ 38.62 | $ 0 | $ 16.36 | $ 19.42 | $ 19.86 | $ 29.25 | ||||
Total cost | $ | $ 48,442,768 | $ 0 | $ 1,588,189 | $ 4,862,248 | $ 17,018,412 | $ 71,911,617 |
Accumulated other comprehensi_3
Accumulated other comprehensive loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | $ 822,881 | $ 710,742 | |
Transfer of AFS investments to HTM investments | 43 | 140 | $ (71) |
Other comprehensive income (loss), net of taxes | (19,475) | 15,628 | (54,183) |
Balance at end of year | 882,343 | 822,881 | 710,742 |
HTM investments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Transfer of AFS investments to HTM investments | 0 | 0 | 1,442 |
Unrealized gains (losses) on AFS investments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Transfer of AFS investments to HTM investments | 0 | 0 | (1,442) |
Unrealized (losses) on translation of net investment in foreign operations | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (17,549) | (20,152) | (13,645) |
Transfer of AFS investments to HTM investments | 0 | ||
Other comprehensive income (loss), net of taxes | (2,317) | 2,603 | (6,507) |
Balance at end of year | (19,866) | (17,549) | (20,152) |
Accumulated net investment gain (loss) | HTM investments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (839) | (979) | (2,350) |
Transfer of AFS investments to HTM investments | 1,442 | ||
Other comprehensive income (loss), net of taxes | 43 | 140 | (71) |
Balance at end of year | (796) | (839) | (979) |
Accumulated net investment gain (loss) | Unrealized gains (losses) on AFS investments | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (15,737) | (22,680) | (57) |
Transfer of AFS investments to HTM investments | (1,442) | ||
Other comprehensive income (loss), net of taxes | (27,893) | 6,943 | (21,181) |
Balance at end of year | (43,630) | (15,737) | (22,680) |
Employee benefit plans | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (94,927) | (100,869) | (74,445) |
Transfer of AFS investments to HTM investments | 0 | ||
Other comprehensive income (loss), net of taxes | 10,692 | 5,942 | (26,424) |
Balance at end of year | (84,235) | (94,927) | (100,869) |
Employee benefit plans | Pension plans | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (61,341) | (63,232) | (46,331) |
Transfer of AFS investments to HTM investments | 0 | ||
Other comprehensive income (loss), net of taxes | (3,551) | 1,891 | (16,901) |
Balance at end of year | (64,892) | (61,341) | (63,232) |
Employee benefit plans | Post- retirement medical benefit plan | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (33,586) | (37,637) | (28,114) |
Transfer of AFS investments to HTM investments | 0 | ||
Other comprehensive income (loss), net of taxes | 14,243 | 4,051 | (9,523) |
Balance at end of year | (19,343) | (33,586) | (37,637) |
Total AOCL | |||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax | |||
Balance at beginning of year | (129,052) | (144,680) | (90,497) |
Transfer of AFS investments to HTM investments | 0 | ||
Other comprehensive income (loss), net of taxes | (19,475) | 15,628 | (54,183) |
Balance at end of year | $ (148,527) | $ (129,052) | $ (144,680) |
Accumulated other comprehensi_4
Accumulated other comprehensive loss - Net Change of AOCL Components (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net unrealized gains (losses) on translation of net investment in foreign operations adjustments | |||
Foreign currency translation adjustments | $ (13,764) | $ 12,568 | $ (25,691) |
Gains (loss) on net investment hedge | 11,447 | (9,965) | 19,184 |
Net change | (2,317) | 2,603 | (6,507) |
Investment adjustments | |||
Gross unrealized gains (losses) | (27,893) | 6,943 | (21,181) |
Net unrealized (gains) losses transferred to HTM | 43 | 140 | (71) |
Employee benefit plans adjustments | |||
Net loss (gain) on settlement reclassified to net income | 1,554 | 0 | 0 |
Prior service credit (cost) arising during the year | (212) | 0 | 0 |
Other comprehensive income (loss), net of taxes | (19,475) | 15,628 | (54,183) |
Pension plans | |||
Employee benefit plans adjustments | |||
Net actuarial gain (loss) | (7,541) | 1,472 | (19,956) |
Prior service credit (cost) arising during the year | (212) | 0 | 0 |
Net actuarial gain (loss) | (5,987) | 1,472 | (19,956) |
Amortization of net actuarial (gains) losses | 2,106 | 2,247 | 1,702 |
Change in deferred taxes | (298) | (595) | 1,315 |
Foreign currency translation adjustments of related balances | 840 | (1,233) | 38 |
Amortization of prior service (credit) cost | 0 | 0 | 0 |
Total changes recognized in other comprehensive income (loss) | (3,551) | 1,891 | (16,901) |
Post- retirement medical benefit plan | |||
Employee benefit plans adjustments | |||
Prior service credit (cost) arising during the year | 0 | 0 | 0 |
Net actuarial gain (loss) | 11,589 | 1,296 | (5,911) |
Amortization of net actuarial (gains) losses | 2,615 | 3,514 | 2,731 |
Change in deferred taxes | 0 | 0 | 0 |
Amortization of prior service (credit) cost | 39 | (759) | (6,343) |
Total changes recognized in other comprehensive income (loss) | 14,243 | 4,051 | (9,523) |
Held-to-maturity Securities | |||
Investment adjustments | |||
Net unrealized (gains) losses transferred to HTM | 0 | 0 | 1,442 |
Transfer of realized (gains) losses to net income | 43 | 140 | (71) |
Net change | 43 | 140 | 1,371 |
Available-for-sale Securities | |||
Investment adjustments | |||
Gross unrealized gains (losses) | (26,793) | 11,129 | (19,635) |
Net unrealized (gains) losses transferred to HTM | 0 | 0 | (1,442) |
Transfer of realized (gains) losses to net income | (1,100) | (4,186) | (1,546) |
Net change | $ (27,893) | $ 6,943 | $ (22,623) |
Capital structure - Authorized
Capital structure - Authorized Capital (Details) | Sep. 16, 2016shares | Jul. 25, 2016 | Dec. 31, 2018$ / sharesshares | Dec. 31, 2017$ / sharesshares | Sep. 06, 2016$ / sharesshares | Sep. 06, 2016$ / sharesshares | Sep. 06, 2016£ / sharesshares | Sep. 05, 2016$ / sharesshares | Sep. 05, 2016$ / sharesshares | Sep. 05, 2016£ / sharesshares | Jun. 22, 2009$ / shares |
Class of Stock [Line Items] | |||||||||||
Common stock, consolidation ratio | 0.1 | ||||||||||
Common shares, par value (in BMD per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.10 | $ 0.01 | |||||||
Preference shares, par value (in dollars per share or pounds per share) | $ / shares | $ 1,000 | ||||||||||
US dollars | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred shares, authorized (in shares) | 110,200,001 | 110,200,001 | 110,200,001 | 110,200,001 | 110,200,001 | 110,200,001 | |||||
Preference shares, par value (in dollars per share or pounds per share) | $ / shares | $ 0.01 | $ 0.01 | |||||||||
United Kingdom, Pounds | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred shares, authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | |||||
Preference shares, par value (in dollars per share or pounds per share) | £ / shares | £ 0.01 | £ 0.01 | |||||||||
Common Stock Issued And Common Stock Authorized But Unissued | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common shares, par value (in BMD per share) | $ / shares | $ 0.01 | $ 0.10 | |||||||||
Common shares | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common shares, par value (in BMD per share) | $ / shares | $ 0.01 | $ 0.10 | |||||||||
Common shares, authorized (in shares) | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | |||
Non-voting Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common shares, par value (in BMD per share) | $ / shares | $ 0.01 | $ 0.01 | |||||||||
Common shares, authorized (in shares) | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | |||
Common Class A Prior To The Reverse Share Split | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common shares, par value (in BMD per share) | $ / shares | $ 0.01 | ||||||||||
Common shares, authorized (in shares) | 20,000,000,000 | 20,000,000,000 | 20,000,000,000 | ||||||||
Nonvoting Common Stock Prior To The Reverse Share Split | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common shares, par value (in BMD per share) | $ / shares | $ 0.01 | ||||||||||
Common shares, authorized (in shares) | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | ||||||||
IPO | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common shares (in shares) | 12,234,042 | ||||||||||
Newly Issued | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common shares (in shares) | 5,957,447 | ||||||||||
Selling Shareholders | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common shares (in shares) | 6,276,595 | ||||||||||
Over-Allotment Option | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common shares (in shares) | 1,595,744 |
Capital structure - Preference
Capital structure - Preference Shares (Details) - $ / shares | Jun. 22, 2009 | Dec. 31, 2016 | Dec. 15, 2016 |
Class of Stock [Line Items] | |||
Preference shares, issued (in shares) | 200,000 | ||
Preferred stock, dividend rate | 8.00% | 8.00% | |
Preference shares, par value (in dollars per share) | $ 1,000 | ||
Preference shares, liquidation preference (in dollars per share) | $ 1,000 | ||
Exercise price of warrants (in dollars per share) | $ 34.72 | ||
Preferred stock, make-whole redemption payment per share (in dollars per share) | $ 1,180 | ||
Common shares | |||
Class of Stock [Line Items] | |||
Number of securities called by warrants or rights (in shares) | 427,960 | 432,028 | |
Exercise price of warrants (in dollars per share) | $ 70.10 | $ 34.72 |
Capital structure - Dividends D
Capital structure - Dividends Declared (Details) - $ / shares | Feb. 18, 2019 | Jun. 22, 2009 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | |||||
Common share cash dividends paid (in dollars per share) | $ 1.52 | $ 1.28 | $ 0.4 | ||
Preferred stock, dividend rate | 8.00% | 8.00% | |||
Preferred stock cash dividends paid (in dollars per share) | $ 0 | $ 0 | |||
Subsequent Event | |||||
Class of Stock [Line Items] | |||||
Common share cash dividends declared (in dollars per share) | $ 0.44 |
Capital structure - Regulatory
Capital structure - Regulatory Capital (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Capital | ||
CET 1 capital | $ 846,043 | $ 772,311 |
Tier 1 capital | 846,043 | 772,311 |
Tier 2 capital | 121,521 | 74,010 |
Total capital | 967,564 | 846,321 |
Risk Weighted Assets | 4,321,354 | 4,254,178 |
Leverage Ratio Exposure Measure | $ 11,139,677 | $ 11,195,173 |
Capital Ratios (%) | ||
Common Equity Tier 1, Actual | 19.60% | 18.20% |
Common Equity Tier 1, Regulatory minimum | 9.40% | 8.80% |
Total Tier 1, Actual | 19.60% | 18.20% |
Total Tier 1, Regulatory minimum | 10.90% | 10.30% |
Total Capital, Actual | 22.40% | 19.90% |
Total Capital, Regulatory minimum | 15.60% | 14.90% |
Leverage ratio, Actual | 7.60% | 6.90% |
Leverage ratio, Regulatory minimum | 5.00% | 5.00% |
Income taxes - Income Taxes in
Income taxes - Income Taxes in Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Current tax expense | $ 721 | $ 856 | $ 727 |
Deferred tax expense | 563 | 231 | 0 |
Total tax expense | $ 1,284 | $ 1,087 | $ 727 |
Income taxes - Reconciliation b
Income taxes - Reconciliation between the Effective Income Tax Rate and the Statutory Income Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
$ | |||
Income tax expense in international offices taxed at different rates | $ 876 | $ 232 | $ (2,104) |
Change in valuation allowance | 0 | 597 | 87 |
Prior year tax adjustments | (79) | (55) | (71) |
Other - net | 487 | 313 | 2,815 |
Total tax expense | $ 1,284 | $ 1,087 | $ 727 |
% | |||
Income tax expense in international offices taxed at different rates | 0.40% | 0.20% | (1.80%) |
Change in valuation allowance | 0.00% | 0.40% | 0.10% |
Prior year tax adjustments | 0.00% | 0.00% | (0.10%) |
Other - net | 0.20% | 0.20% | 2.40% |
Income tax expense (benefit) at effective tax rate | 0.70% | 0.70% | 0.60% |
Income taxes - Deferred income
Income taxes - Deferred income taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred income tax asset | ||
Tax loss carried forward | $ 6,261 | $ 6,868 |
Pension liability | 789 | 1,152 |
Fixed assets | (746) | (223) |
Allowance for compensated absence | 14 | 15 |
Deferred income tax asset before valuation allowance | 6,318 | 7,812 |
Less: valuation allowance | (5,955) | (6,723) |
Net deferred income tax assets | 363 | 1,089 |
Deferred income tax liability | ||
Other | (5) | 0 |
Net deferred income tax assets | $ 358 | $ 1,089 |
Income taxes - Narrative (Detai
Income taxes - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Operating Loss Carryforwards [Line Items] | ||
Deferred tax assets, valuation allowance | $ 5,955 | $ 6,723 |
Foreign Tax Authority | ||
Operating Loss Carryforwards [Line Items] | ||
Tax loss carried forward | 34,400 | 33,600 |
United Kingdom | ||
Operating Loss Carryforwards [Line Items] | ||
Deferred tax assets, valuation allowance | $ 6,000 | $ 6,700 |
Business combinations - Bermuda
Business combinations - Bermuda Trust Company Limited and the Private Banking Investment Management of Operations of HSBC Bank Bermuda Limited Acquisition (Details) | May 06, 2016USD ($) | Apr. 29, 2016USD ($)segmentsubsidiary | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Business Acquisition [Line Items] | ||||||||
Professional and outside services | $ 26,034,000 | $ 27,181,000 | $ 18,851,000 | |||||
Customer Relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Assets acquired | $ 18,200,000 | $ 0 | $ 21,400,000 | |||||
Acquired finite-lived intangible assets, useful life | 15 years | |||||||
BTCL and HSBCBB | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of subsidiaries involved in acquisition activity | subsidiary | 2 | |||||||
Consideration transferred, including contingent consideration | $ 21,800,000 | |||||||
Payments to acquire businesses | $ 2,100,000 | 7,000,000 | $ 12,700,000 | |||||
Contingent consideration, liability, current | $ 12,700,000 | |||||||
Acquired finite-lived intangible assets, number of segments | segment | 3 | |||||||
Acquisition related costs | $ 4,300,000 | $ 3,300,000 | $ 1,000,000 | |||||
Professional and outside services | 700,000 | $ 1,000,000 | ||||||
Revenue | 407,453,000 | |||||||
Earnings | 118,434,000 | |||||||
BTCL and HSBCBB | Customer Relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Assets acquired | $ 21,400,000 | |||||||
Acquired finite-lived intangible assets, useful life | 15 years | |||||||
HSBCBB | ||||||||
Business Acquisition [Line Items] | ||||||||
Revenue | 9,800,000 | |||||||
Earnings | $ 5,000,000 |
Business combinations - Total C
Business combinations - Total Consideration Transferred (Details) - USD ($) $ in Thousands | Mar. 29, 2018 | Apr. 29, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets acquired | ||||||
Excess purchase price (goodwill) | $ 23,991 | $ 21,529 | $ 19,622 | $ 23,462 | ||
BTCL and HSBCBB | ||||||
Business Acquisition [Line Items] | ||||||
Total consideration transferred | $ 21,778 | |||||
Assets acquired | ||||||
Intangible assets | 21,443 | |||||
Other assets | 3,345 | |||||
Total assets acquired | 24,788 | |||||
Liabilities acquired | 3,010 | |||||
Excess purchase price (goodwill) | $ 0 | |||||
Deutsche Bank’s Global Trust Solutions | ||||||
Business Acquisition [Line Items] | ||||||
Total consideration transferred | $ 24,680 | |||||
Assets acquired | ||||||
Cash due from banks | 3,958 | |||||
Intangible assets | 16,932 | |||||
Other assets | 4,548 | |||||
Total assets acquired | 25,438 | |||||
Liabilities acquired | 4,626 | |||||
Excess purchase price (goodwill) | $ 3,868 | |||||
Acquired finite-lived intangible assets, useful life | 15 years |
Business combinations - Pro For
Business combinations - Pro Forma Information (Details) - BTCL and HSBCBB $ in Thousands | 8 Months Ended |
Dec. 31, 2016USD ($) | |
Unaudited pro forma financial information | |
Total net revenue | $ 407,453 |
Total non-interest operating expense | 289,019 |
Pro forma net income post business combination | $ 118,434 |
Business combinations - Deutsch
Business combinations - Deutsche Bank’s Global Trust Solutions (Details) $ in Thousands | May 29, 2018USD ($) | Mar. 29, 2018USD ($)clientstructure | Dec. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||||||
Professional and outside services | $ 26,034 | $ 27,181 | $ 18,851 | ||||
Deutsche Bank’s Global Trust Solutions | |||||||
Business Acquisition [Line Items] | |||||||
Net cash payments | $ 24,680 | ||||||
Payments to acquire businesses | $ 30,200 | ||||||
Refund based upon movement in number of clients | $ 5,500 | ||||||
Number of trust structures managed and administrated | structure | 1,000 | ||||||
Number of private clients | client | 900 | ||||||
Acquisition related costs | 1,900 | 1,900 | $ 3,800 | ||||
Professional and outside services | $ 1,000 | $ 1,600 | |||||
Revenue | $ 6,500 | ||||||
Net deficit | $ 2,900 |
Related party transactions - Fi
Related party transactions - Financing Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Interest and fees on loans | $ 218,495 | $ 187,020 | $ 188,000 |
Deposits | 9,452,241 | 9,536,458 | |
Non-interest expense | 321,343 | 300,336 | 285,899 |
Directors and Executives | |||
Related Party Transaction [Line Items] | |||
Loans outstanding | 97,200 | 30,600 | |
Proceeds from loans receivable | 77,300 | 31,700 | 27,600 |
Payments for loans receivable | 11,000 | 8,900 | 25,100 |
Interest and fees on loans | 4,500 | 1,100 | 400 |
Deposits | 17,200 | 23,500 | |
Director | |||
Related Party Transaction [Line Items] | |||
Loans reclassified out of related party loans | 4,300 | ||
Affiliates | |||
Related Party Transaction [Line Items] | |||
Loans outstanding | 10,200 | 10,500 | |
Interest and fees on loans | 600 | 600 | 600 |
Deposits | 400 | 600 | |
Non-interest expense | $ 1,800 | $ 1,900 | $ 2,200 |
Related party transactions - Ca
Related party transactions - Capital Transaction (Details) - Significant Shareholder - Carlyle Group | Feb. 27, 2017person |
Related Party Transaction [Line Items] | |
Voting interest owned by related party | 14.00% |
Right to designate as members of the board of directors, number of persons | 2 |
Related party transactions - _2
Related party transactions - Financial Transactions With Related Parties (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Deposits | $ 9,452,241,000 | $ 9,536,458,000 | |
Asset management revenue | 25,603,000 | 24,711,000 | $ 21,106,000 |
Custody and other administration services revenue | 9,262,000 | 8,149,000 | 8,883,000 |
Wholly-owned subsidiary | |||
Related Party Transaction [Line Items] | |||
Loans outstanding | 10,200,000 | 10,500,000 | |
Deposits | 400,000 | 600,000 | |
Asset Management Arrangement | Wholly-owned subsidiary | |||
Related Party Transaction [Line Items] | |||
Investment in subsidiaries | 6,200,000 | 6,600,000 | |
Unrealized gain on trading investments | 1,200,000 | 1,600,000 | |
Loans outstanding | 1,800,000 | 0 | |
Deposits | 36,700,000 | 200,000 | |
Asset management revenue | 9,400,000 | 7,700,000 | 5,700,000 |
Custody and other administration services revenue | 1,400,000 | 1,000,000 | 1,000,000 |
Other income | $ 900,000 | $ 100,000 | $ 100,000 |
Condensed financial statement_3
Condensed financial statements of the parent company only - Condensed Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | |||
Cash and demand deposits with banks - Non-interest bearing | $ 124,182 | $ 89,381 | |
Demand deposits with banks - Interest bearing | 487,588 | 340,256 | |
Cash equivalents - Interest bearing | 1,442,113 | 1,105,501 | |
Cash due from banks | 2,053,883 | 1,535,138 | |
Securities purchased under agreement to resell | 27,341 | 178,769 | |
Short-term investments | 52,336 | 249,984 | |
Investment in securities | |||
Trading | 6,495 | 6,824 | |
Available-for-sale | 2,182,749 | 3,317,440 | |
Held-to-maturity (fair value: $1,076,979 (2017: $695,758)) | 2,066,120 | 1,381,955 | |
Total investment in securities | 4,255,364 | 4,706,219 | |
Loans to third parties, net of allowance for credit losses | 4,043,889 | 3,776,862 | |
Accrued interest | 20,870 | 24,915 | |
Other assets, including premises, equipment and computer software, equity method investments, receivables from subsidiaries and other real estate owned | 66,687 | 58,739 | |
Total assets | 10,773,178 | 10,779,237 | |
Customer deposits | |||
Non-interest bearing | 2,119,596 | 2,480,168 | |
Interest bearing | 5,357,312 | 5,341,632 | |
Total deposits | 9,452,241 | 9,536,458 | |
Employee benefit plans | 117,203 | 128,798 | |
Accrued interest | 5,072 | 2,376 | |
Pending payable for investments purchased | 0 | 51,913 | |
Other liabilities, including payables to subsidiaries | 172,997 | 119,811 | |
Total other liabilities | 295,272 | 302,898 | |
Long-term debt | 143,322 | 117,000 | |
Total liabilities | 9,890,835 | 9,956,356 | |
Shareholders' equity | |||
Total shareholders’ equity | 882,343 | 822,881 | $ 710,742 |
Total liabilities and shareholders’ equity | 10,773,178 | 10,779,237 | |
Held-to-maturity, fair value | 2,036,214 | 1,377,354 | |
Banks | |||
Customer deposits | |||
Non-interest bearing | 8,100 | 442 | |
Interest bearing | 18,965 | 7,704 | |
Total deposits | 33,822 | 12,466 | |
Customers | |||
Customer deposits | |||
Non-interest bearing | 2,111,496 | 2,479,726 | |
Interest bearing | 5,338,347 | 5,333,928 | |
Total deposits | 9,418,419 | 9,523,992 | |
Bank of N.T. Butterfield & Son Ltd | |||
Assets | |||
Cash and demand deposits with banks - Non-interest bearing | 21,677 | 23,774 | |
Demand deposits with banks - Interest bearing | 316,872 | 192,099 | |
Cash equivalents - Interest bearing | 364,714 | 389,120 | |
Cash due from banks | 703,263 | 604,993 | |
Securities purchased under agreement to resell | 27,341 | 178,769 | |
Short-term investments | 13,736 | 109,322 | |
Investment in securities | |||
Trading | 6,495 | 6,824 | |
Available-for-sale | 1,345,408 | 2,234,979 | |
Held-to-maturity (fair value: $1,076,979 (2017: $695,758)) | 1,088,564 | 697,531 | |
Total investment in securities | 2,440,467 | 2,939,334 | |
Loans to third parties, net of allowance for credit losses | 1,949,701 | 1,960,103 | |
Accrued interest | 12,824 | 12,149 | |
Other assets, including premises, equipment and computer software, equity method investments, receivables from subsidiaries and other real estate owned | 203,599 | 203,518 | |
Total assets | 5,859,127 | 6,455,657 | |
Customer deposits | |||
Total deposits | 4,649,703 | 5,265,075 | |
Employee benefit plans | 117,203 | 127,687 | |
Accrued interest | 2,908 | 1,171 | |
Pending payable for investments purchased | 0 | 51,913 | |
Other liabilities, including payables to subsidiaries | 63,648 | 69,930 | |
Total other liabilities | 183,759 | 250,701 | |
Long-term debt | 143,322 | 117,000 | |
Total liabilities | 4,976,784 | 5,632,776 | |
Shareholders' equity | |||
Total shareholders’ equity | 882,343 | 822,881 | |
Total liabilities and shareholders’ equity | 5,859,127 | 6,455,657 | |
Held-to-maturity, fair value | 1,076,979 | 695,758 | |
Bank of N.T. Butterfield & Son Ltd | Banks | |||
Investment in securities | |||
Net assets of subsidiaries | 415,227 | 373,576 | |
Loans to subsidiaries | 12,754 | 13,517 | |
Customer deposits | |||
Total deposits | 154,101 | 12,252 | |
Bank of N.T. Butterfield & Son Ltd | Customers | |||
Investment in securities | |||
Net assets of subsidiaries | 24,195 | 2,543 | |
Loans to subsidiaries | 56,020 | 57,833 | |
Customer deposits | |||
Non-interest bearing | 1,378,539 | 1,840,201 | |
Interest bearing | 3,117,063 | 3,412,622 | |
Total deposits | $ 4,495,602 | $ 5,252,823 |
Condensed financial statement_4
Condensed financial statements of the parent company only - Condensed Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Non-interest income | |||
Banking | $ 45,010 | $ 43,772 | $ 39,342 |
Foreign exchange revenue | 32,895 | 32,222 | 30,606 |
Other non-interest income | 4,912 | 4,035 | 3,476 |
Total non-interest income | 168,686 | 157,825 | 147,473 |
Interest income | |||
Interest and fees on loans | 218,495 | 187,020 | 188,000 |
Deposits with banks | 24,830 | 17,178 | 9,759 |
Total interest income | 367,588 | 305,629 | 274,929 |
Interest expense | |||
Deposits | 17,617 | 10,931 | 11,831 |
Long-term debt | 6,949 | 4,954 | 4,500 |
Securities sold under repurchase agreements | 33 | 0 | 118 |
Total interest expense | 24,599 | 15,885 | 16,449 |
Net interest income before provision for credit losses | 342,989 | 289,744 | 258,480 |
Provision for credit gains (losses) | 6,991 | 5,837 | (4,399) |
Net interest income after provision for credit losses | 349,980 | 295,581 | 254,081 |
Net trading gains (losses) | (329) | 511 | 715 |
Net realized gains (losses) on available-for-sale investments | 1,100 | 4,186 | 1,546 |
Net gains (losses) on other real estate owned | (322) | (2,383) | (440) |
Net other gains (losses) | (1,304) | (1,045) | (807) |
Total other gains (losses) | (855) | 1,269 | 1,014 |
Total net revenue | 517,811 | 454,675 | 402,568 |
Non-interest expense | |||
Salaries and other employee benefits | 159,778 | 145,138 | 140,246 |
Technology and communications | 60,280 | 53,999 | 57,441 |
Professional and outside services | 26,034 | 27,181 | 18,851 |
Property | 21,825 | 19,878 | 21,043 |
Indirect taxes | 19,485 | 18,050 | 16,352 |
Marketing | 6,116 | 5,739 | 4,513 |
Non-service employee benefits expense | 5,570 | 8,090 | (279) |
Amortization of intangible assets | 5,091 | 4,210 | 4,514 |
Restructuring costs | 0 | 1,772 | 6,266 |
Other expenses | 17,164 | 16,279 | 16,952 |
Total non-interest expense | 321,343 | 300,336 | 285,899 |
Net income | 195,184 | 153,252 | 115,942 |
Other comprehensive income (loss), net of taxes | (19,475) | 15,628 | (54,183) |
Total comprehensive income | 175,709 | 168,880 | 61,759 |
Bank of N.T. Butterfield & Son Ltd | |||
Non-interest income | |||
Banking | 23,506 | 22,836 | 21,984 |
Foreign exchange revenue | 11,727 | 11,623 | 11,174 |
Other non-interest income | 6,330 | 4,570 | 3,516 |
Total non-interest income | 120,658 | 105,089 | 83,274 |
Interest income | |||
Interest and fees on loans | 133,124 | 118,092 | 123,370 |
Investments | 73,698 | 61,928 | 44,745 |
Deposits with banks | 12,932 | 10,661 | 6,293 |
Total interest income | 219,754 | 190,681 | 174,408 |
Interest expense | |||
Deposits | 6,709 | 5,011 | 6,882 |
Long-term debt | 6,949 | 4,955 | 4,500 |
Securities sold under repurchase agreements | 33 | 0 | 118 |
Total interest expense | 13,691 | 9,966 | 11,500 |
Net interest income before provision for credit losses | 206,063 | 180,715 | 162,908 |
Provision for credit gains (losses) | 6,823 | 4,618 | (7,263) |
Net interest income after provision for credit losses | 212,886 | 185,333 | 155,645 |
Net trading gains (losses) | (329) | 511 | 330 |
Net realized gains (losses) on available-for-sale investments | 758 | 4,241 | 1,222 |
Net gains (losses) on other real estate owned | (323) | (2,416) | (287) |
Net other gains (losses) | 0 | 258 | (325) |
Total other gains (losses) | 106 | 2,594 | 940 |
Total net revenue | 333,650 | 293,016 | 239,859 |
Non-interest expense | |||
Salaries and other employee benefits | 75,949 | 72,440 | 68,712 |
Technology and communications | 36,466 | 33,051 | 34,033 |
Professional and outside services | 22,696 | 20,685 | 9,379 |
Property | 6,693 | 6,438 | 5,983 |
Indirect taxes | 14,669 | 12,900 | 10,562 |
Marketing | 3,034 | 3,384 | 2,138 |
Non-service employee benefits expense | 6,427 | 7,854 | 1,058 |
Amortization of intangible assets | 169 | 169 | 113 |
Restructuring costs | 0 | 0 | 117 |
Other expenses | 4,230 | 4,351 | 5,373 |
Total non-interest expense | 170,333 | 161,272 | 137,468 |
Net income before equity in undistributed earnings of subsidiaries | 163,317 | 131,744 | 102,391 |
Equity in undistributed earnings of subsidiaries | 31,867 | 21,508 | 13,551 |
Net income | 195,184 | 153,252 | 115,942 |
Other comprehensive income (loss), net of taxes | (19,475) | 15,628 | (54,183) |
Total comprehensive income | 175,709 | 168,880 | 61,759 |
Bank of N.T. Butterfield & Son Ltd | Banks | |||
Non-interest income | |||
Dividends from subsidiaries | 60,000 | 50,000 | 40,000 |
Bank of N.T. Butterfield & Son Ltd | Customers | |||
Non-interest income | |||
Dividends from subsidiaries | $ 19,095 | $ 16,060 | $ 6,600 |
Condensed financial statement_5
Condensed financial statements of the parent company only - Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities | ||||||
Net income | $ 195,184 | $ 153,252 | $ 115,942 | |||
Adjustments to reconcile net income to operating cash flows | ||||||
Depreciation and amortization | 46,476 | 50,398 | 52,261 | |||
(Increase) decrease in carrying value of equity method investments | (1,118) | (1,028) | (1,137) | |||
Share-based payments and settlements | 12,582 | 8,410 | 14,423 | |||
Net realized / unrealized (gains) losses on other real estate owned | 322 | 2,383 | 440 | |||
Net realized (gains) losses on available-for-sale investments | (1,100) | (4,186) | (1,546) | |||
Dividends received from equity method investments | 556 | 412 | 441 | |||
Provision for credit (recovery) losses | (6,991) | (5,837) | 4,399 | |||
Changes in operating assets and liabilities | ||||||
(Increase) decrease in accrued interest receivable | 3,838 | (1,761) | (6,054) | |||
(Increase) decrease in other assets | (7,813) | 25,600 | (6,694) | |||
Increase (decrease) in accrued interest payable | 2,774 | 82 | (284) | |||
Increase (decrease) in employee benefit plans and other liabilities | 51,635 | 14,396 | 5,587 | |||
Cash provided by (used in) operating activities | 296,345 | 242,121 | 178,636 | |||
Cash flows from investing activities | ||||||
(Increase) decrease in securities purchased under agreement to resell | 151,428 | (29,956) | (148,813) | |||
Net (increase) decrease in short-term investments other than restricted cash | 188,115 | 277,788 | (122,323) | |||
Net change in trading investments | 329 | (511) | 314,986 | |||
Available-for-sale investments: proceeds from sale | 854,160 | 213,047 | 60,548 | |||
Available-for-sale investments: proceeds from maturities and pay downs | 480,765 | 524,971 | 576,892 | |||
Available-for-sale investments: purchases | (242,087) | (730,765) | (1,884,554) | |||
Held-to-maturity investments: proceeds from maturities and pay downs | 166,406 | 113,573 | 73,725 | |||
Held-to-maturity investments: purchases | (903,958) | (385,813) | (360,959) | |||
Net (increase) decrease in loans to third parties | (321,944) | (130,107) | 321,722 | |||
Additions to premises, equipment and computer software | (18,529) | (19,218) | (9,804) | |||
Proceeds from sale of other real estate owned | 5,896 | 2,689 | 5,528 | |||
Net cash disbursed for business acquisitions | (20,722) | 0 | (21,778) | |||
Cash provided by (used in) investing activities | 338,551 | (164,302) | (1,194,830) | |||
Cash flows from financing activities | ||||||
Net increase (decrease) in demand and term deposit liabilities | (22,543) | (621,105) | 1,056,029 | |||
Issuance of subordinated capital, net of underwriting fees | 73,218 | 0 | 0 | |||
Repayment of long-term debt | (47,000) | 0 | 0 | |||
Proceeds from issuance of common shares, net of underwriting discounts and commissions | 0 | 13 | 131,600 | |||
Cost of issuance of common shares | 0 | 0 | (5,458) | |||
Proceeds from loans sold under agreement to repurchase | 0 | 0 | 5,152 | |||
Cost of repurchase of loans under agreement to repurchase | 0 | 0 | (5,152) | |||
Common shares repurchased | (48,443) | 0 | (1,633) | |||
Preference shares repurchased | 0 | 0 | (212,121) | |||
Warrant repurchased | 0 | 0 | (100) | |||
Proceeds from stock option exercises | 3,318 | 4,546 | 6,919 | |||
Cash dividends paid on common shares | (83,704) | (69,731) | (19,346) | |||
Cash dividends paid on preference shares | 0 | 0 | (14,629) | |||
Preference shares guarantee fee paid | 0 | 0 | (1,676) | |||
Cash provided by (used in) financing activities | (125,154) | (686,277) | 939,585 | |||
Cash, cash equivalent and restricted cash: beginning of year | 1,557,732 | 2,119,545 | 2,301,399 | |||
Cash, cash equivalent and restricted cash: end of year | 2,070,120 | 1,557,732 | 2,119,545 | |||
Components of cash, cash equivalent and restricted cash at end of year | ||||||
Cash due from banks | $ 2,053,883 | $ 1,535,138 | $ 2,101,651 | |||
Restricted cash included in short-term investments on the consolidated balance sheets | 16,237 | 22,594 | 17,894 | |||
Total cash, cash equivalent and restricted cash at end of year | 1,557,732 | 2,119,545 | 2,301,399 | 2,070,120 | 1,557,732 | 2,119,545 |
Non-cash items | ||||||
Transfer to other real estate owned | 2,437 | 0 | 8,961 | |||
Bank of N.T. Butterfield & Son Ltd | ||||||
Cash flows from operating activities | ||||||
Net income | 195,184 | 153,252 | 115,942 | |||
Adjustments to reconcile net income to operating cash flows | ||||||
Depreciation and amortization | 21,425 | 23,982 | 23,687 | |||
(Increase) decrease in carrying value of equity method investments | (1,033) | (1,152) | (949) | |||
Share-based payments and settlements | 12,582 | 8,410 | 14,423 | |||
Equity in undistributed earnings of subsidiaries | (31,867) | (21,508) | (13,551) | |||
Net realized / unrealized (gains) losses on other real estate owned | 323 | 2,416 | 287 | |||
Net realized (gains) losses on available-for-sale investments | (758) | (4,241) | (1,222) | |||
Dividends received from equity method investments | 376 | 307 | 319 | |||
Provision for credit (recovery) losses | (6,823) | (4,618) | 7,263 | |||
Changes in operating assets and liabilities | ||||||
(Increase) decrease in accrued interest receivable | (755) | 2,886 | (1,163) | |||
(Increase) decrease in other assets | (11,160) | 12,167 | (20,312) | |||
Increase (decrease) in accrued interest payable | 1,737 | (519) | 160 | |||
Increase (decrease) in employee benefit plans and other liabilities | (2,523) | 22,282 | 10,388 | |||
Cash provided by (used in) operating activities | 176,708 | 193,664 | 135,272 | |||
Cash flows from investing activities | ||||||
(Increase) decrease in securities purchased under agreement to resell | 151,428 | (29,956) | (148,813) | |||
Net (increase) decrease in short-term investments other than restricted cash | 87,268 | 342,585 | (330,144) | |||
Net change in trading investments | 329 | (511) | (146) | |||
Available-for-sale investments: proceeds from sale | 681,656 | 205,257 | 25,489 | |||
Available-for-sale investments: proceeds from maturities and pay downs | 340,114 | 324,907 | 341,835 | |||
Available-for-sale investments: purchases | (156,271) | (595,526) | (1,332,836) | |||
Held-to-maturity investments: proceeds from maturities and pay downs | 82,853 | 59,424 | 38,430 | |||
Held-to-maturity investments: purchases | (525,637) | (199,145) | (124,325) | |||
Net (increase) decrease in loans to third parties | 15,184 | (46,391) | 177,823 | |||
Additions to premises, equipment and computer software | (9,830) | (14,777) | (5,700) | |||
Proceeds from sale of other real estate owned | 5,896 | 1,795 | 3,061 | |||
Injection of capital in subsidiary | (64,029) | (12,802) | (6,945) | |||
Return of capital from a subsidiary | 8,244 | 12,376 | 0 | |||
Net cash disbursed for business acquisitions | 0 | 0 | (2,540) | |||
Cash provided by (used in) investing activities | 619,781 | 85,212 | (1,349,031) | |||
Cash flows from financing activities | ||||||
Net increase (decrease) in demand and term deposit liabilities | (603,925) | (811,322) | 1,696,948 | |||
Issuance of subordinated capital, net of underwriting fees | 73,218 | 0 | 0 | |||
Repayment of long-term debt | (47,000) | 0 | 0 | |||
Proceeds from issuance of common shares, net of underwriting discounts and commissions | 0 | 13 | 131,600 | |||
Cost of issuance of common shares | 0 | 0 | (5,458) | |||
Proceeds from loans sold under agreement to repurchase | 0 | 0 | 5,152 | |||
Cost of repurchase of loans under agreement to repurchase | 0 | 0 | (5,152) | |||
Common shares repurchased | (48,443) | 0 | (1,633) | |||
Preference shares repurchased | 0 | 0 | (212,121) | |||
Warrant repurchased | 0 | 0 | (100) | |||
Proceeds from stock option exercises | 3,318 | 4,546 | 6,919 | |||
Cash dividends paid on common shares | (83,704) | (69,731) | (19,346) | |||
Cash dividends paid on preference shares | 0 | 0 | (14,629) | |||
Preference shares guarantee fee paid | 0 | 0 | (1,676) | |||
Cash provided by (used in) financing activities | (706,536) | (876,494) | 1,580,504 | |||
Net increase (decrease) in cash, cash equivalent and restricted cash | 89,953 | (597,618) | 366,745 | |||
Cash, cash equivalent and restricted cash: beginning of year | 627,046 | 1,224,664 | 857,919 | |||
Cash, cash equivalent and restricted cash: end of year | 716,999 | 627,046 | 1,224,664 | |||
Components of cash, cash equivalent and restricted cash at end of year | ||||||
Cash due from banks | 703,263 | 604,993 | 1,206,770 | |||
Restricted cash included in short-term investments on the consolidated balance sheets | 13,736 | 22,053 | 17,894 | |||
Total cash, cash equivalent and restricted cash at end of year | 627,046 | 1,224,664 | 857,919 | $ 716,999 | $ 627,046 | $ 1,224,664 |
Supplemental disclosure of cash flow information | ||||||
Cash interest paid | 15,428 | 9,447 | 11,660 | |||
Non-cash items | ||||||
Transfer to other real estate owned | 2,041 | 0 | 8,961 | |||
Bank of N.T. Butterfield & Son Ltd | Banks | ||||||
Cash flows from investing activities | ||||||
Net decrease in loans to subsidiaries | 764 | 40,689 | 10,608 | |||
Bank of N.T. Butterfield & Son Ltd | Customers | ||||||
Cash flows from investing activities | ||||||
Net decrease in loans to subsidiaries | $ 1,812 | $ (2,713) | $ 5,172 |
Subsequent events (Details)
Subsequent events (Details) | Feb. 18, 2019$ / shares |
Subsequent Event | |
Subsequent Event [Line Items] | |
Common share cash dividends declared (in dollars per share) | $ 0.44 |