Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 25, 2019 | Jun. 30, 2018 | |
Document and Entity Information | |||
Entity Registrant Name | INTERNATIONAL BANCSHARES CORP | ||
Entity Central Index Key | 315,709 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 2,830,143,000 | ||
Entity Common Stock, Shares Outstanding | 65,617,505 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false |
Consolidated Statements of Cond
Consolidated Statements of Condition - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and cash equivalents | $ 316,797,000 | $ 265,357,000 |
Investment securities: | ||
Held to maturity debt securities (Market value of $1,200 on December 31, 2018 and $2,400 on December 31, 2017) | 1,200,000 | 2,400,000 |
Available for sale debt securities (Amortized cost of $3,481,166 on December 31, 2018 and $4,196,263 on December 31, 2017) | 3,411,350,000 | 4,124,184,000 |
Equity securities with readily determinable fair values | 5,937,000 | 27,886,000 |
Total investment securities | 3,418,487,000 | 4,154,470,000 |
Loans | 6,561,289,000 | 6,348,172,000 |
Less allowance for probable loan losses | (61,384,000) | (67,687,000) |
Net loans | 6,499,905,000 | 6,280,485,000 |
Bank premises and equipment, net | 506,899,000 | 514,454,000 |
Accrued interest receivable | 36,803,000 | 34,456,000 |
Other investments | 337,507,000 | 293,990,000 |
Cash surrender value of bank owned life insurance | 282,646,000 | 277,425,000 |
Goodwill | 282,532,000 | 282,532,000 |
Other assets | 190,376,000 | 81,529,000 |
Total assets | 11,871,952,000 | 12,184,698,000 |
Deposits: | ||
Demand - non-interest bearing | 3,454,840,000 | 3,243,255,000 |
Savings and interest bearing demand | 3,268,237,000 | 3,245,131,000 |
Time | 1,973,468,000 | 2,056,506,000 |
Total deposits | 8,696,545,000 | 8,544,892,000 |
Securities sold under repurchase agreements | 229,989,000 | 353,805,000 |
Other borrowed funds | 705,665,000 | 1,195,225,000 |
Junior subordinated deferrable interest debentures | 160,416,000 | 160,416,000 |
Other liabilities | 139,755,000 | 91,380,000 |
Total liabilities | 9,932,370,000 | 10,345,718,000 |
Shareholders' equity: | ||
Common shares of $1.00 par value. Authorized 275,000,000 shares; issued 96,104,029 shares on December 31, 2018 and 96,019,028 shares on December 31, 2017 | 96,104,000 | 96,019,000 |
Surplus | 145,283,000 | 171,816,000 |
Retained earnings | 2,064,134,000 | 1,891,805,000 |
Accumulated other comprehensive loss | (54,634,000) | (28,397,000) |
Total shareholders' equity before treasury stock | 2,250,887,000 | 2,131,243,000 |
Less cost of shares in treasury, 30,494,143 shares on December 31, 2018 and 29,939,545 on December 31, 2017 | (311,305,000) | (292,263,000) |
Total shareholders' equity | 1,939,582,000 | 1,838,980,000 |
Total liabilities and shareholders' equity | $ 11,871,952,000 | $ 12,184,698,000 |
Consolidated Statements of Co_2
Consolidated Statements of Condition (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Consolidated Statements of Condition | ||
Held to maturity, Fair value (in dollars) | $ 1,200 | $ 2,400 |
Available for sale, Amortized cost (in dollars) | $ 3,481,165 | $ 4,196,263 |
Common shares, par value (in dollars per share) | $ 1 | $ 1 |
Common shares, Authorized shares | 275,000,000 | 275,000,000 |
Common shares, issued shares | 96,104,029 | 96,019,028 |
Treasury, shares | 30,494,143 | 29,939,545 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest income: | |||
Loans, including fees | $ 375,173 | $ 322,508 | $ 297,820 |
Investment securities: | |||
Taxable | 81,484 | 82,347 | 79,533 |
Tax-exempt | 8,141 | 9,656 | 10,356 |
Other interest income | 1,024 | 625 | 205 |
Total interest income | 465,822 | 415,136 | 387,914 |
Interest expense: | |||
Savings deposits | 12,764 | 6,208 | 4,562 |
Time deposits | 13,096 | 9,736 | 9,963 |
Securities sold under repurchase agreements | 2,415 | 6,617 | 20,876 |
Other borrowings | 17,404 | 10,978 | 3,128 |
Junior subordinated deferrable interest debentures | 6,989 | 5,392 | 4,600 |
Total interest expense | 52,668 | 38,931 | 43,129 |
Net interest income | 413,154 | 376,205 | 344,785 |
Provision for probable loan losses | 6,112 | 11,221 | 19,859 |
Net interest income after provision for probable loan losses | 407,042 | 364,984 | 324,926 |
Non-interest income: | |||
Investment securities transactions, net | (141) | (4,774) | (2,626) |
Other investments, net | 19,897 | 18,918 | 23,827 |
Other income | 18,367 | 11,085 | 13,647 |
Total non-interest income | 165,042 | 150,406 | 161,702 |
Non-interest expense: | |||
Employee compensation and benefits | 138,532 | 132,750 | 128,661 |
Occupancy | 29,097 | 28,439 | 26,583 |
Depreciation of bank premises and equipment | 25,873 | 25,281 | 24,738 |
Professional fees | 12,601 | 13,650 | 13,672 |
Deposit insurance assessments | 3,742 | 3,294 | 5,777 |
Net expense, other real estate owned | 4,413 | 965 | 5,688 |
Amortization of identified intangible assets | 25 | 128 | |
Advertising | 7,695 | 7,854 | 7,814 |
Early termination fee - securities sold under repurchase agreements | 5,765 | 7,042 | |
Software and software maintenance | 17,516 | 19,189 | 15,087 |
Impairment charges (Total other-than-temporary impairment charges, $0 net of $0, $0 net of $0, and $793 net of $1,147 included in other comprehensive loss) | 354 | ||
Other | 60,032 | 56,536 | 54,081 |
Total non-interest expense | 299,501 | 293,748 | 289,625 |
Income before income taxes | 272,583 | 221,642 | 197,003 |
Provision for income taxes | 56,652 | 64,206 | 63,071 |
Net income | $ 215,931 | $ 157,436 | $ 133,932 |
Basic earnings per common share: | |||
Weighted average number of shares outstanding (in shares) | 66,106,580 | 66,046,155 | 65,967,989 |
Net income (in dollars per share) | $ 3.27 | $ 2.38 | $ 2.03 |
Fully diluted earnings per common share: | |||
Weighted average number of shares outstanding (in shares) | 66,633,820 | 66,778,436 | 66,313,490 |
Net income (in dollars per share) | $ 3.24 | $ 2.36 | $ 2.02 |
Services charges on deposit accounts | |||
Non-interest income: | |||
Service charges | $ 72,433 | $ 72,868 | $ 73,581 |
Other service charges, commissions and fees, Banking | |||
Non-interest income: | |||
Service charges | 46,685 | 44,964 | 46,267 |
Other service charges, commissions and fees, Non-banking | |||
Non-interest income: | |||
Service charges | $ 7,801 | $ 7,345 | $ 7,006 |
Consolidated Statements of In_2
Consolidated Statements of Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated Statements of Income | |||
Impairment charges, other-than-temporary impairment charges | $ 0 | $ 0 | $ 793 |
Impairment charges, other comprehensive income | $ 0 | $ 0 | $ 1,147 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated Statements of Comprehensive Income | |||
Net income | $ 215,931 | $ 157,436 | $ 133,932 |
Other comprehensive income (loss), net of tax: | |||
Net unrealized holding losses on securities available for sale arising during period (net of tax effects of $(7,004), $(2,586), and $(16,585)) | (26,348) | (4,803) | (30,801) |
Reclassification adjustment for losses on securities available for sale included in net income (net of tax effects of $30, $1,671, and $919) | 111 | 3,103 | 1,707 |
Reclassification adjustment for impairment charges on available for sale securities included in net income (net of tax effects of $0, $0, and $124) | 230 | ||
Other comprehensive income, net of tax | (26,237) | (1,700) | (28,864) |
Comprehensive income | $ 189,694 | $ 155,736 | $ 105,068 |
Consolidated Statements of Co_3
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated Statements of Comprehensive Income | |||
Net unrealized holding gains (losses) on securities available for sale arising during period, tax effects | $ (7,004) | $ (2,586) | $ (16,585) |
Reclassification adjustment for losses on securities available for sale included in net income, tax effects | 30 | 1,671 | 919 |
Reclassification adjustment for impairment charges on available for sale securities included in net income, tax effects | $ 0 | $ 0 | $ 124 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Preferred Stock | Common Stock | Surplus | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total |
Balance at Dec. 31, 2015 | $ 95,866 | $ 167,980 | $ 1,683,600 | $ 2,167 | $ (284,110) | $ 1,665,503 | |
Balance (in shares) at Dec. 31, 2015 | 95,866 | ||||||
Increase (decrease) in shareholders' equity | |||||||
Net Income | 133,932 | 133,932 | |||||
Dividends: | |||||||
Cash ($.75, $.66 and $.60 per share) for the year ended December 31, 2018, 2017 and 2016, respectively) | (39,569) | (39,569) | |||||
Purchase of treasury stock (554,598, 4,870 and 349,029 shares) for the years ended December 31, 2018, 2017 and 2016, respectively) | (7,966) | (7,966) | |||||
Exercise of stock options | 44 | 505 | 549 | ||||
Options exercised (in shares) | 44 | ||||||
Stock compensation expense recognized in earnings | 1,082 | 1,082 | |||||
Other comprehensive income (loss), net of tax: | |||||||
Net change in unrealized gains and losses on available for sale securities, net of reclassification adjustments | (28,864) | (28,864) | |||||
Balance at Dec. 31, 2016 | 95,910 | 169,567 | 1,777,963 | (26,697) | (292,076) | 1,724,667 | |
Balance (in shares) at Dec. 31, 2016 | 95,910 | ||||||
Increase (decrease) in shareholders' equity | |||||||
Net Income | 157,436 | 157,436 | |||||
Dividends: | |||||||
Cash ($.75, $.66 and $.60 per share) for the year ended December 31, 2018, 2017 and 2016, respectively) | (43,594) | (43,594) | |||||
Purchase of treasury stock (554,598, 4,870 and 349,029 shares) for the years ended December 31, 2018, 2017 and 2016, respectively) | (187) | (187) | |||||
Exercise of stock options | 109 | 1,346 | 1,455 | ||||
Options exercised (in shares) | 109 | ||||||
Stock compensation expense recognized in earnings | 903 | 903 | |||||
Other comprehensive income (loss), net of tax: | |||||||
Net change in unrealized gains and losses on available for sale securities, net of reclassification adjustments | (1,700) | (1,700) | |||||
Balance at Dec. 31, 2017 | 96,019 | 171,816 | 1,891,805 | (28,397) | (292,263) | 1,838,980 | |
Balance (in shares) at Dec. 31, 2017 | 96,019 | ||||||
Dividends: | |||||||
Cumulative adjustment for adoption of new accounting standards | 5,997 | (5,997) | |||||
Net Income | 215,931 | 215,931 | |||||
Cash ($.75, $.66 and $.60 per share) for the year ended December 31, 2018, 2017 and 2016, respectively) | (49,599) | (49,599) | |||||
Purchase of treasury stock (554,598, 4,870 and 349,029 shares) for the years ended December 31, 2018, 2017 and 2016, respectively) | (19,042) | (19,042) | |||||
Exercise of stock options | 85 | 1,437 | 1,522 | ||||
Options exercised (in shares) | 85 | ||||||
Stock compensation expense recognized in earnings | 1,035 | 1,035 | |||||
Repurchase of outstanding warrant | (29,005) | (29,005) | |||||
Other comprehensive income (loss), net of tax: | |||||||
Net change in unrealized gains and losses on available for sale securities, net of reclassification adjustments | (20,240) | (20,240) | |||||
Balance at Dec. 31, 2018 | $ 96,104 | $ 145,283 | $ 2,064,134 | $ (54,634) | $ (311,305) | $ 1,939,582 | |
Balance (in shares) at Dec. 31, 2018 | 96,104 |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated Statements of Shareholders' Equity | |||
Cash Dividends (in dollars per share) | $ 0.75 | $ 0.66 | $ 0.60 |
Purchase of treasury stock (in shares) | 554,598 | 4,870 | 349,029 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating activities: | |||
Net income | $ 215,931,000 | $ 157,436,000 | $ 133,932,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Provision for probable loan losses | 6,112,000 | 11,221,000 | 19,859,000 |
Specific reserve, other real estate owned | 3,071,000 | 710,000 | 2,351,000 |
Depreciation of bank premises and equipment | 25,873,000 | 25,281,000 | 24,738,000 |
Gain on sale of bank premises and equipment | (1,456,000) | (38,000) | (450,000) |
Gain (loss) on sale of other real estate owned | (1,465,000) | (703,000) | 86,000 |
Accretion of investment securities discounts | (271,000) | (393,000) | (539,000) |
Amortization of investment securities premiums | 20,087,000 | 24,040,000 | 26,873,000 |
Investment securities transactions, net | 141,000 | 4,774,000 | 2,626,000 |
Impairment charges on available for sale securities | 354,000 | ||
Unrealized loss on equity securities with readily determinable fair values | 388,000 | ||
Amortization of identified intangible assets | 25,000 | 128,000 | |
Stock based compensation expense | 1,035,000 | 903,000 | 1,082,000 |
Earnings from affiliates and other investments | (15,484,000) | (13,198,000) | (14,315,000) |
Deferred tax expense | 5,143,000 | 4,570,000 | 7,306,000 |
Increase in accrued interest receivable | (2,347,000) | (2,284,000) | (600,000) |
(Increase) decrease in other assets | (51,827,000) | (16,117,000) | 7,494,000 |
Net increase (decrease) in other liabilities | 24,916,000 | 592,000 | (7,705,000) |
Net cash provided by operating activities | 229,847,000 | 196,819,000 | 203,220,000 |
Investing activities: | |||
Proceeds from maturities of securities | 2,275,000 | 1,200,000 | |
Proceeds from sales and calls of available for sale securities | 38,175,000 | 396,066,000 | 352,743,000 |
Proceeds from sales of equity securities with readily determinable fair values | 21,607,000 | ||
Purchases of available for sale securities | (47,346,000) | (1,182,006,000) | (1,325,657,000) |
Principal collected on mortgage backed securities | 675,304,000 | 780,097,000 | 919,594,000 |
Net increase in loans | (258,142,000) | (394,267,000) | (38,523,000) |
Purchases of other investments | (43,418,000) | (26,193,000) | (49,013,000) |
Distributions from other investments | 3,668,000 | 20,344,000 | 23,276,000 |
Purchases of bank premises and equipment | (21,395,000) | (14,315,000) | (38,856,000) |
Proceeds from sales of bank premises and equipment | 4,533,000 | 2,201,000 | 3,701,000 |
Proceeds from sales of other real estate owned | 4,179,000 | 14,266,000 | 13,772,000 |
Net cash provided by (used in) investing activities | 379,440,000 | (403,807,000) | (137,763,000) |
Financing activities: | |||
Net increase in non-interest bearing demand deposits | 211,585,000 | 85,204,000 | 8,433,000 |
Net increase in savings and interest bearing demand deposits | 23,106,000 | 41,403,000 | 183,506,000 |
Net decrease in time deposits | (83,038,000) | (191,804,000) | (118,103,000) |
Net decrease in securities sold under repurchase agreements | (123,816,000) | (151,180,000) | (322,787,000) |
Net (decrease) increase in other borrowed funds | (489,560,000) | 461,850,000 | 227,625,000 |
Redemption of long-term debt | (1,000,000) | ||
Repurchase of outstanding common stock warrant | (29,005,000) | ||
Purchase of treasury stock | (19,042,000) | (187,000) | (7,966,000) |
Proceeds from stock transactions | 1,522,000 | 1,455,000 | 549,000 |
Payments of cash dividends - common | (49,599,000) | (43,594,000) | (39,569,000) |
Net cash (used in) provided by financing activities | (557,847,000) | 203,147,000 | (69,312,000) |
Increase (decrease) in cash and cash equivalents | 51,440,000 | (3,841,000) | (3,855,000) |
Cash and cash equivalents at beginning of period | 265,357,000 | 269,198,000 | 273,053,000 |
Cash and cash equivalents at end of period | 316,797,000 | 265,357,000 | 269,198,000 |
Supplemental cash flow information: | |||
Interest paid | 50,623,000 | 38,995,000 | 44,069,000 |
Income taxes paid | 40,565,000 | 66,983,000 | 49,925,000 |
Non-cash investing and financing activities: | |||
Net transfers from loans to other real estate owned | $ 32,610,000 | $ 2,588,000 | $ 2,563,000 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | (1) Summary of Significant Accounting Policies Our accounting and reporting policies conform to U.S. generally accepted accounting principles (“GAAP”) and to general practices within the banking industry. The following is a description of the more significant of those policies. Consolidation and Basis of Presentation Our consolidated financial statements include the accounts of the International Bancshares Corporation, its wholly-owned Subsidiary Banks and its wholly-owned non-bank subsidiaries, IBC Subsidiary Corporation, IBC Trading Company, Premier Tierra Holdings, Inc., IBC Charitable and Community Development Corporation, and IBC Capital Corporation. All significant inter-company balances and transactions have been eliminated in consolidation. We, through our Subsidiary Banks, are primarily engaged in the business of banking, including the acceptance of checking and savings deposits and the making of commercial, real estate, personal, home improvement, automobile and other installment and term loans. Our primary markets are north, south, central, and southeast Texas and the state of Oklahoma. Each of our Subsidiary Banks is very active in facilitating international trade along the United States border with Mexico and elsewhere. Although our loan portfolio is diversified, the ability of our debtors to honor their contracts is primarily dependent upon the economic conditions in our trade area. In addition, the investment portfolio is directly impacted by fluctuations in market interest rates. We are subject to the regulations of certain federal agencies as well as the Texas Department of Banking and the Oklahoma Department of Banking and undergo periodic examinations by those regulatory authorities. Such agencies may require certain standards or impose certain limitations based on their judgments or changes in law and regulations. We own one insurance‑related subsidiary, IBC Insurance Agency, Inc., a wholly owned subsidiary of our Subsidiary Bank, International Bank of Commerce, Laredo. The insurance‑related subsidiary does not conduct underwriting activities. The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the dates of the statement of condition and income and expenses for the periods. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant changes in the near‑term relate to the determination of the allowance for probable loan losses. Subsequent Events We have evaluated all events or transactions that occurred through the date we issued these financial statements. During this period, we did not have any material recognizable or non‑recognizable subsequent events. Investment Securities We classify debt securities into one of these categories: held‑to‑maturity, available‑for‑sale, or trading. Such classifications are reassessed for appropriate classification at each reporting date. Securities that are intended and expected to be held until maturity are classified as “held‑to‑maturity” and are carried at amortized cost for financial statement reporting. Securities that are not positively expected to be held until maturity, but are intended to be held for an indefinite period of time are classified as “available‑for‑sale” or “trading” and are carried at their fair value. Unrealized holding gains and losses are included in net income for those securities classified as “trading”, while unrealized holding gains and losses related to those securities classified as “available‑for‑sale” are excluded from net income and reported net of tax as other comprehensive income and in shareholders’ equity as accumulated other comprehensive income (loss) until realized. We did not maintain any trading securities during the three-year period ended December 31, 2018. Mortgage‑backed securities held at December 31, 2018 and 2017 represent participating interests in pools of long‑term first mortgage loans originated and serviced by the issuers of the securities. Mortgage‑backed securities are either issued or guaranteed by the U.S. government or its agencies including the Federal Home Loan Mortgage Corporation (“Freddie Mac”), the Federal National Mortgage Association (“Fannie Mae”), the Government National Mortgage Association (“Ginnie Mae”) or other non‑government entities. Investments in residential mortgage‑backed securities issued by Ginnie Mae are fully guaranteed by the U. S. government. Investments in residential mortgage‑backed securities issued by Freddie Mac and Fannie Mae are not fully guaranteed by the U.S. government; however, we believe that the quality of the bonds is similar to other AAA rated bonds with limited credit risk, particularly given the placement of Fannie Mae and Freddie Mac into conservatorship by the federal government in 2008 and because securities issued by others that are collateralized by residential mortgage‑backed securities issued by Fannie Mae or Freddie Mac are rated consistently as AAA rated securities. Market interest rate fluctuations can affect the prepayment speed of principal and the yield on the security. Premiums and discounts are amortized using the level yield or “interest method” over the terms of the securities. Declines in the fair value of held‑to‑maturity and available‑for sale‑securities below their cost that are deemed to be other than temporary are reflected in earnings as realized losses. In determining whether other‑than‑temporary impairment exists, management considers many factors, including (i) the length of time and the extent to which the fair value has been less than cost, (ii) the financial condition and near‑term prospects of the issuer, and (iii) our intent to hold and our determination of whether we will more likely than not be required to sell the security prior to a recovery in fair value. If we determine that (i) we intend to sell the security or (ii) it is more likely than not that we will be required to sell the security before it’s anticipated recovery, the other‑than‑temporary impairment that is recognized in earnings is equal to the difference between the fair value of the security and our amortized cost of the security. If we determine that we (i) do not intend to sell the security and (ii) we will not be more likely than not required to sell the security before it’s anticipated recovery, the other‑than‑temporary impairment is segregated into its two components (i) the amount of impairment related to credit loss and (ii) the amount of impairment related to other factors. The difference between the present value of the cash flows expected to be collected and the amortized cost is the credit loss recognized through earnings and an adjustment to the cost basis of the security. The amount of impairment related to other factors is included in other comprehensive income (loss). Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. Equity Securities Prior to January 1, 2018, equity securities with readily determinable fair values were included in available-for-sale securities, with the unrealized gain or loss recorded as a component of other comprehensive income (loss). Pursuant to the adoption of ASU 2016-02, equity securities with readily determinable fair values are a separate component of our balance sheet, with unrealized gains and losses recognized in net income. Equity securities with readily determinable fair values at December 31, 2018 and December 31, 2017 consist primarily of Community Reinvestment Act funds. Provision and Allowance for Probable Loan Losses The allowance for probable loan losses is maintained at a level considered adequate by management to provide for probable loan losses. The allowance is increased by provisions charged to operating expense and reduced by net charge‑offs. The provision for probable loan losses is the amount, which, in the judgment of management, is necessary to establish the allowance for probable loan losses at a level that is adequate to absorb known and inherent risks in the loan portfolio. Management believes that the allowance for probable loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review our Subsidiary Banks’ allowances for probable loan losses. Such agencies may require our Subsidiary Banks to make additions or reductions to their GAAP allowances based on their judgments of information available to them at the time of their examination. The Subsidiary Banks charge-off that portion of any loan which management considers to represent a loss as well as that portion of any other loan which is classified as a “loss” by bank examiners. Commercial, financial and agricultural or real estate loans are generally considered by management to represent a loss, in whole or part, (i) when an exposure beyond any collateral coverage is apparent, (ii) when no further collection of the portion of the loan so exposed is anticipated based on actual results, (iii) when the credit enhancements, if any, are not adequate, and (iv) when the borrower’s financial condition would indicate so. Generally, unsecured consumer loans are charged-off when 90 days past due. Loans Loans are reported at the principal balance outstanding, net of unearned discounts. Interest income on loans is reported on an accrual basis. Loan fees and costs associated with originating the loans are accreted or amortized over the life of the loan using the interest method. We originate mortgage loans that may subsequently be sold to an unaffiliated third party. The loans are not securitized and if sold, are sold without recourse. Loans held for sale are carried at cost and the principal amount outstanding is not significant to the consolidated financial statements. Impaired Loans Impaired loans are those loans where it is probable that all amounts due according to contractual terms of the loan agreement will not be collected. Impaired loans are measured based on (1) the present value of expected future cash flows discounted at the loan’s effective interest rate; (2) the loan’s observable market price; or (3) the fair value of the collateral if the loan is collateral dependent. Substantially all our impaired loans are measured at the fair value of the collateral. In limited cases, we may use other methods to determine the level of impairment of a loan if such loan is not collateral dependent. Troubled Debt Restructured Loans Troubled debt restructured loans (“TDR”) are those loans where, for reasons related to a borrower’s difficulty to repay a loan, we grant a concession to the borrower that we would not normally consider in the normal course of business. The original terms of the loan are modified or restructured. The terms that may be modified include a reduction in the original stated interest rate, an extension of the original maturity of the loan, a renewal of the loan at an interest rate below current market rates, a reduction in the principal amount of debt outstanding, a reduction in accrued interest or deferral of interest payments. A loan classified as a TDR is classified as an impaired loan and included in the impaired loan totals. A TDR loan may be returned to accrual status when the loan is brought current, has performed in accordance with the restructured terms for a reasonable period of time, is at the current market rate, and the ultimate collectability of the outstanding principal and interest is no longer questionable, however, although those loans may be placed back on accrual status, they will continue to be classified as impaired. Consistent with regulatory guidance, a TDR loan that is subsequently modified, but has shown sustained performance and classification as a TDR, will be removed from TDR status provided that the modified terms were market-based at the time of modification. Non‑Accrual Loans The non‑accrual loan policy of our Subsidiary Banks is to discontinue the accrual of interest on loans when management determines that it is probable that future interest accruals will be un‑collectible. As it relates to consumer loans, management charges-off those loans when the loan is contractually 90 days past due. Under special circumstances, a consumer or non‑consumer loan may be more than 90 days delinquent as to interest or principal and not be placed on non‑accrual status. This situation generally results when a Subsidiary Bank has a borrower who is experiencing financial difficulties, but not to the extent that requires a restructuring of indebtedness. The majority of this category is composed of loans that are considered to be adequately secured and/or for which there are expected future payments. When a loan is placed on non‑accrual status, any interest accrued, not paid is reversed and charged to operations against interest income. As it relates to non‑consumer loans that are not 90 days past due, management will evaluate each of these loans to determine if placing the loan on non‑accrual status is warranted. Interest income on non‑accrual loans is recognized only to the extent payments are received or when, in management’s opinion, the debtor’s financial condition warrants reestablishment of interest accruals. Other Real Estate Owned and Reposessed Assets Other real estate owned is comprised of real estate acquired by foreclosure and deeds in lieu of foreclosure. Other real estate is carried at the lower of the recorded investment in the property or its fair value less estimated costs to sell such property (as determined by independent appraisal). Prior to foreclosure, the value of the underlying loan is written down to the fair value of the real estate to be acquired by a charge to the allowance for probable loan losses, if necessary. Any subsequent write‑downs are charged against other non‑interest expense through a valuation allowance. Other real estate owned totaled approximately $57,344,000 and $30,519,000 at December 31, 2018 and 2017, respectively. Other real estate owned is included in other assets. Reposessed assets consist primarily of non-real estate assets acquired by foreclosure. Prior to foreclosure, the value of the underlying loan is written down to the fair value of the asset to be repossessed by a charge to the allowance for probable loan losses, if necessary. Reposessed assets are included in other assets on the consolidated financial statements and totaled approximately $6,454,000 and $303,000 at December 31, 2018 and 2017, respectively. Bank Premises and Equipment Bank premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed on straight‑line and accelerated methods over the estimated useful lives of the assets. Repairs and maintenance are charged to operations as incurred and expenditures for renewals and betterments are capitalized. Other Investments Other investments include equity investments in non‑financial companies, as well as equity securities with no readily determinable fair market value. Equity investments are accounted for using the equity method of accounting. Equity securities with no readily determinable fair value are accounted for using the cost method. Cash Surrender Value of Bank Owned Life Insurance Cash surrender value of bank owned life insurance includes investments in cash value insurance policies to assist with financing employee compensation and benefit programs. The cash value of the underlying policies accumulates on a tax-free basis and is received through death proceeds, which are also tax-free. The earnings on the policies are derived from the investment portfolio returns of the individual insurance carriers for general account policies and on the returns on investments segregated in our name for separate account policies. Revenue Recognition On January 1, 2018, we adopted the provisions of ASU 2014-09 to ASC 606, “Revenue from Contracts with Customers.” Since our revenue is primarily comprised of net interest income on financial assets and liabilities, which were excluded from the scope of the update, the remaining non-interest revenue streams were identified and then analyzed under the provisions of the update, to: (i) indentify the contract, (ii) identify the performance obligation, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations, and (v) recognize revenue when the performance obligation was satisfied. Our non-interest revenue contracts with customers are primarily short term and our performance obligation is satisfied at a single point in time, typically within a single period. No changes to our existing methods for recognizing revenue were made as a result of the update. Income Taxes Deferred income tax assets and liabilities are determined using the asset and liability method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the differences between the book and tax basis of the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws. We file a consolidated federal income tax return with our subsidiaries. Recognition of deferred tax assets is based on management’s assessment that the benefit related to certain temporary differences, tax operating loss carry forwards, and tax credits are more likely than not to be realized. A valuation allowance is recorded for the amount of the deferred tax items for which it is more likely than not that the tax benefits will not be realized. We evaluate uncertain tax positions at the end of each reporting period. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefit recognized in the financial statements from any such a position is measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. As of December 31, 2018 and 2017, respectively, after evaluating all uncertain tax positions, we have recorded no liability for unrecognized tax benefits at the end of the reporting period. We would recognize any interest accrued on unrecognized tax benefits as other interest expense and penalties as other non‑interest expense. During the years ended December 31, 2018, 2017 and 2016, we recognized no interest expense or penalties related to uncertain tax positions. We file consolidated tax returns in the U.S. Federal jurisdiction and various state jurisdictions. We are no longer subject to U.S. federal or state income tax examinations by tax authorities for years before 2015. Stock Options Compensation expense for stock awards is based on the market price of the stock on the measurement date, which is generally the date of grant, and is recognized ratably over the service period of the award. The fair value of stock options granted was estimated using the Black‑Sholes‑Merton option‑pricing model. This model was developed for use in estimating the fair value of publicly traded options that have no vesting restrictions and are fully transferable. Additionally, the model requires the input of highly subjective assumptions. Because our employee stock options have characteristics significantly different from those of publicly traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the Black‑Scholes‑Merton option‑pricing model does not necessarily provide a reliable single measure of the fair value of our stock options. Net Income Per Share Basic Earnings Per Share (“EPS”) is calculated by dividing net income by the weighted average number of common shares outstanding. The computation of diluted EPS assumes the issuance of common shares for all dilutive potential common shares outstanding during the reporting period. The dilutive effect of stock options is considered in earnings per share calculations, if dilutive, using the treasury stock method. Goodwill and Identified Intangible Assets Goodwill represents the excess of costs over fair value of assets of businesses acquired. Goodwill is tested for impairment at least annually or on an interim basis if an event triggering impairment may have occurred. As of October 1, 2018, after completing goodwill testing, we have determined that no goodwill impairment exists. Identified intangible assets are acquired assets that lack physical substance but can be distinguished from goodwill because of contractual or other legal rights or because the asset is capable of being sold or exchanged either on its own or in combination with a related contract, asset, or liability. Our identified intangible assets relate to core deposits and contract rights. As of December 31, 2018, we have determined that no impairment of identified intangibles exists. Identified intangible assets with definite useful lives are amortized on an accelerated basis over their estimated life. See Note 6—Goodwill and Other Intangible Assets. Impairment of Long‑Lived Assets Long‑lived assets, such as property, plant and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying value of the asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying value of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying value of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the statement of condition and reported at the lower of the carrying value or fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the statement of condition. Consolidated Statements of Cash Flows For purposes of the consolidated statements of cash flows, we consider all short‑term investments with a maturity at date of purchase of three months or less to be cash equivalents. Also, we report transactions related to deposits and loans to customers on a net basis. Accounting for Transfers and Servicing of Financial Assets We account for transfers and servicing of financial assets and extinguishments of liabilities based on the application of a financial‑components approach that focuses on control. After a transfer of financial assets, we recognize the financial and servicing assets we control and liabilities we have incurred, derecognize financial assets when control has been surrendered and derecognize liabilities when extinguished. We have retained mortgage servicing rights in connection with the sale of mortgage loans. Because we may not initially identify loans as originated for resale, all loans are initially treated as held for investment. The value of the mortgage servicing rights are reviewed periodically for impairment and are amortized in proportion to, and over the period of estimated net servicing income or net servicing losses. The value of the mortgage servicing rights is not significant to the consolidated statements of condition. Segments of an Enterprise and Related Information We operate as one segment. The operating information used by our chief executive officer for purposes of assessing performance and making operating decisions is the consolidated financial statements presented in this report. We have five active operating subsidiaries, namely, the Subsidiary Banks. We apply the provisions of ASC Topic 280, “Segment Reporting,” in determining our reportable segments and related disclosures. Comprehensive Income (Loss) Comprehensive income (loss) consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale. Advertising Advertising costs are expensed as incurred. Reclassifications Certain amounts in the prior year’s presentations have been reclassified to conform to the current presentation. These reclassifications had no effect on previously reported net income or shareholders’ equity. New Accounting Standards In May 2014, the FASB issued Accounting Standards Update No. 2014-09 to ASC 606, “Revenue from Contracts with Customers.” The update sets a common standard that defines revenue and the principles for recognizing revenue. The update outlines when an entity should recognize revenue, among other matters. At its core, the update states that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The update also outlines the steps that entities should take to determine and record the current revenue number including: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract(s), (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract(s), and (v) recognize revenue when (or as) the entity satisfies the identified performance obligations in the contract(s). The update was originally effective for annual periods beginning after December 31, 2016 and the interim periods within that reporting period. In August 2015, the FASB issued Accounting Standards Update No. 2015-14 which deferred the effective date of ASU 2014-09 by one year to annual and interim periods beginning after December 15, 2017. On January 1, 2018, we adopted the provisions of ASU 2014-09 to ASC 606. Our revenue is primarily comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASC 606. We have evaluated the impact of the accounting standards update on certain other non-interest revenue streams that the provisions of the update apply to and has determined that the adoption of the new provisions to ASC 606 did not have a significant impact to our consolidated financial statements or operations. In January 2016, the FASB issued Accounting Standards Update No. 2016-01 to ASC 825-10, “Financial Instruments – Overall.” The update amends existing standards regarding certain aspects of recognition and measurement of financial assets and financial liabilities. The amendments in the update establish the following guidance: (i) requires equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income, (ii) simplifies the impairment assessment of equity securities without readily determinable fair values by requiring a qualitative assessment, (iii) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities, (iv) eliminates the requirement for public business entities to disclose the methods and significant assumptions used to estimate fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (v) requires public business entities to use the exit price notion when measuring fair value for disclosure purposes, (vi) requires an entity to present separately, in other comprehensive income, the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option, (vii) requires separate presentation of financial assets and liabilities by measurement category and form of financial assets on the balance sheet or in the accompanying notes to the financial statements, and (viii) clarifies that an entity should evaluate the need to a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The update is effective for interim and annual periods beginning after December 15, 2017. On January 1, 2018, we adopted the provisions of ASU 2016-01 The main effect resulting from the adoption of the new standards is that beginning on January 1, 2018, equity securities with readily determinable fair values are now reported in a single line item on the face of our consolidated statement of condition under the caption, “Equity securities with readily determinable fair values.” Additionally, the changes in fair value of the equity securities is now recognized in net income and is included in other non-interest expense on the face of our consolidated income statement. Prior to January 1, 2018, the equity securities were classified as available-for-sale and stated at fair value with unrealized gains and losses included in accumulated comprehensive income, net of tax and had a net unrealized loss of $189,000. Other equity securities without readily determinable fair values are recorded at cost less any impairment, if any, and included in other investments in our consolidated financial statements. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 to ASC 820, “Leases.” The update amends existing standards for accounting for leases by lessees, with accounting for leases by lessors remaining mainly unchanged from current guidance. The update requires that lessees recognize a lease liability and a right of use asset for all leases (with the exception of short-term leases) at the commencement date of the lease and disclose key information about leasing arrangements. The update is to be applied on a modified retrospective basis for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the consolidated financial statements. The update is effective for interim and annual periods beginning after December 15, 2018. In January 2018, the FASB issued a proposal that provides an additional transition method that would allow entities to not apply the guidance in the update in the comparative periods presented in the consolidated financial statements, but instead recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The adoption of the update is not expected to have a significant impact to our consolidated financial statements. In June 2016, the FASB issued Accounting Standards Update No. 2016-13 to ASC 326, “Financial Instruments – Credit Losses.” The update amends existing standards for accounting for credit losses for financial assets. The update requires that the expected credit losses on the financial instruments held as of the end of the period being reported be measured based on historical experience, current conditions, and reasonable and supportable forecasts. The update also expands the required disclosures related to significant estimates and judgements used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s financial assets. The update also amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration and effective for interim and annual periods beginning after December 15, 2019. The change in accounting method represents a significant difference to current accounting practice over the accounting for credit losses on financial assets. We have formed a task force including key members of the teams that work with the current calculation of the allowance for probable loan losses and members representing the corporate accounting and risk management areas. The task force will be working with a plan to develop and implement the changes to current practice with support from third-party vendors. We cannot estimate at this time the impact of ASC 326. In January 2017, the FASB issued Accounting Standards |
Investment Securities
Investment Securities | 12 Months Ended |
Dec. 31, 2018 | |
Investment Securities | |
Investment Securities | (2) Investment Securities The amortized cost and estimated fair value by type of investment security at December 31, 2018 are as follows: Held to Maturity Gross Gross Amortized unrealized unrealized Estimated Carrying cost gains losses fair value value (Dollars in Thousands) Other securities $ 1,200 $ — $ — $ 1,200 $ 1,200 Total investment securities $ 1,200 $ — $ — $ 1,200 $ 1,200 Available for Sale Debt Securities Gross Gross Amortized unrealized unrealized Estimated Carrying cost gains losses fair value value (1) (Dollars in Thousands) Residential mortgage-backed securities $ 3,295,366 $ 6,813 $ (79,169) $ 3,223,010 $ 3,223,010 Obligations of states and political subdivisions 185,799 2,646 (105) 188,340 188,340 Total investment securities $ 3,481,165 $ 9,459 $ (79,274) $ 3,411,350 $ 3,411,350 (1) Included in the carrying value of residential mortgage‑ backed securities are $501,293 of mortgage‑backed securities issued by Ginnie Mae and $2,721,717 of mortgage‑backed securities issued by Fannie Mae and Freddie Mac The amortized cost and estimated fair value of investment securities at December 31, 2018, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without prepayment penalties. Held to Maturity Available for Sale Amortized Estimated Amortized Estimated Cost fair value Cost fair value (Dollars in Thousands) Due in one year or less $ — $ — $ — $ — Due after one year through five years 1,200 1,200 — — Due after five years through ten years — — 500 502 Due after ten years — — 185,299 187,838 Residential mortgage-backed securities — — 3,295,366 3,223,010 Total investment securities $ 1,200 $ 1,200 $ 3,481,165 $ 3,411,350 The amortized cost and estimated fair value by type of investment security at December 31, 2017 are as follows: Held to Maturity Gross Gross Amortized unrealized unrealized Estimated Carrying cost gains losses fair value value (Dollars in Thousands) Other securities $ 2,400 $ — $ — $ 2,400 $ 2,400 Total investment securities $ 2,400 $ — $ — $ 2,400 $ 2,400 Available for Sale Gross Gross Estimated Amortized unrealized unrealized fair Carrying cost gains losses value value (1) (Dollars in Thousands) Residential mortgage-backed securities $ 3,943,092 $ 14,110 $ (65,969) $ 3,891,233 $ 3,891,233 Obligations of states and political subdivisions 225,096 7,871 (16) 232,951 232,951 Equity securities 28,075 293 (482) 27,886 27,886 Total investment securities $ 4,196,263 $ 22,274 $ (66,467) $ 4,152,070 $ 4,152,070 (1) Included in the carrying value of residential mortgage‑ backed securities are $654,063 of mortgage‑backed securities issued by Ginnie Mae, $3,237,1700 of mortgage‑backed securities issued by Fannie Mae and Freddie Mac Residential mortgage‑backed securities are securities issued by Freddie Mac, Fannie Mae, Ginnie Mae or non‑government entities. Investments in residential mortgage‑backed securities issued by Ginnie Mae are fully guaranteed by the U.S. government. Investments in mortgage‑backed securities issued by Freddie Mac and Fannie Mae are not fully guaranteed by the U.S. government; however, we believe that the quality of the bonds is similar to other AAA rated bonds with limited credit risk, particularly given the placement of Fannie Mae and Freddie Mac into conservatorship by the federal government in early September 2008 and because securities issued by others that are collateralized by residential mortgage‑backed securities issued by Fannie Mae and Freddie Mac are rated consistently as AAA rated securities. The amortized cost and fair value of available for sale investment securities pledged to qualify for fiduciary powers, to secure public monies as required by law, repurchase agreements and short‑term fixed borrowings was $1,112,852,000 and $1,086,360,000, respectively, at December 31, 2018. Proceeds from the sale and call of securities available‑for‑sale were $59,782,000, $396,066,000 and $352,743,000 during 2018, 2017 and 2016, respectively, which amounts included $0, $377,756,000 and $338,138,000 of mortgage‑backed securities. Gross gains of $3,000, $1,186,000 and $586,000, and gross losses of $144,000, $5,960,000 and $3,212,000 were realized on the sales in 2018, 2017 and 2016, respectively. Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018 were as follows: Less than 12 months 12 months or more Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses (Dollars in Thousands) Available for sale: Residential mortgage-backed securities $ 208,384 $ (2,124) $ 2,537,181 $ (77,045) $ 2,745,565 $ (79,169) Obligations of states and political subdivisions 12,756 (99) 512 (6) 13,268 (105) $ 221,140 $ (2,223) $ 2,537,693 $ (77,051) $ 2,758,833 $ (79,274) Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position, at December 31, 2017 were as follows: Less than 12 months 12 months or more Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses (Dollars in Thousands) Available for sale: Residential mortgage-backed securities $ 1,061,577 $ (13,157) $ 2,029,455 $ (52,812) $ 3,091,032 $ (65,969) Obligations of states and political subdivisions 5,534 (9) 522 (7) 6,056 (16) Equity securities 11,499 (251) 8,019 (231) 19,518 (482) $ 1,078,610 $ (13,417) $ 2,037,996 $ (53,050) $ 3,116,606 $ (66,467) The unrealized losses on investments in residential mortgage‑backed securities are primarily caused by changes in market interest rates. Residential mortgage‑backed securities are primarily securities issued by Freddie Mac, Fannie Mae and Ginnie Mae. The contractual cash obligations of the securities issued by Ginnie Mae are fully guaranteed by the U.S. government. The contractual cash obligations of the securities issued by Freddie Mac and Fannie Mae are not fully guaranteed by the U.S. government; however, we believe that the quality of the bonds is similar to other AAA rated bonds with limited credit risk, particularly given the placement of Fannie Mae and Freddie Mac into conservatorship by the federal government in early September 2008 and because securities issued by others that are collateralized by residential mortgage‑backed securities issued by Fannie Mae and Freddie Mac are rated consistently as AAA rated securities. The decrease in fair value on residential mortgage‑backed securities issued by Freddie Mac, Fannie Mae and Ginnie Mae is due to market interest rates. We have no intent to sell and more likely than not be required to sell before a market price recovery or maturity of the securities; therefore, it is our conclusion that the investments in residential mortgage‑backed securities issued by Freddie Mac, Fannie Mae and Ginnie Mae are not considered other‑than‑temporarily impaired. In addition, we had a small investment in non‑agency residential mortgage‑backed securities that had additional market volatility beyond economically induced interest rate events, which were sold in the first quarter of 2017. We concluded that the investments in non‑agency residential mortgage‑backed securities were other‑than‑temporarily impaired due to both credit and other than credit issues. No impairment charges were recorded in 2017. Impairment charges of $354,000 ($230,100, after tax) were recorded in 2016 on the non‑agency residential mortgage backed securities. The impairment charges represent the credit related impairment on the securities. The unrealized losses on investments in other securities are caused by fluctuations in market interest rates. The underlying cash obligations of the securities are guaranteed by the entity underwriting the debt instrument. We believe that the entity issuing the debt will honor its interest payment schedule, as well as the full debt at maturity. We purchased the securities for their economic value. The decrease in fair value is primarily due to market interest rates and not other factors, and because we have no intent to sell and will more likely than not be required to sell before a market price recovery or maturity of the securities, it is our conclusion that the investments are not considered other‑than‑temporarily impaired. The following table presents a reconciliation of credit‑related impairment charges on available‑for‑sale investments recognized in earnings for the twelve months ended December 31, 2017 (in Thousands): Balance at December 31, 2016 $ Sale of other-than-temporarily impaired available-for-sale securities during period (13,931) Balance at December 31, 2017 $ — The following table presents a reconciliation of credit‑related impairment charges on available‑for‑sale investments recognized in earnings for the twelve months ended December 31, 2016 (in Thousands): Balance at December 31, 2015 $ Impairment charges recognized during period Balance at December 31, 2016 $ Equity securities with readily determinable fair values consist primarily of Community Reinvestment Act funds. At December 31, 2018 and December 31, 2017, the balance in equity securities with readily determinable fair values recorded at fair value were $5,937,000 and $27,886,000, respectively. Prior to January 1, 2018, the equity securities were included in available-for-sale securities, with the related unrealized gain or loss recorded as a component of other comprehensive income (loss). The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the twelve months ended December 31, 2018: Year Ended December 31, (Dollars in Thousands) 2018 Net losses recognized during the period on equity securities $ (388) Less: Net gains and (losses) recognized during the period on equity securities sold during the period — Unrealized losses recognized during the reporting period on equity securities still held at the reporting date $ (388) |
Loans
Loans | 12 Months Ended |
Dec. 31, 2018 | |
Loans | |
Loans | (3) Loans A summary of loans, by loan type at December 31, 2018 and 2017 is as follows: December 31, December 31, 2018 2017 (Dollars in Thousands) Commercial, financial and agricultural $ 3,305,124 $ 3,322,668 Real estate - mortgage 1,173,101 1,133,525 Real estate - construction 1,886,231 1,683,550 Consumer 46,316 49,543 Foreign 150,517 158,886 Total loans $ 6,561,289 $ 6,348,172 |
Allowance for Probable Loan Los
Allowance for Probable Loan Losses | 12 Months Ended |
Dec. 31, 2018 | |
Allowance for Probable Loan Losses | |
Allowance for Probable Loan Losses | (4) Allowance for Probable Loan Losses The allowance for probable loan losses primarily consists of the aggregate loan loss allowances of the Subsidiary Banks. The allowances are established through charges to operations in the form of provisions for probable loan losses. Loan losses or recoveries are charged or credited directly to the allowances. The allowance for probable loan losses of each Subsidiary Bank is maintained at a level considered appropriate by management, based on estimated probable losses in the loan portfolio. The allowance for probable loan losses is derived from the following elements: (i) allowances established on specific impaired loans, which are based on a review of the individual characteristics of each loan, including the customer’s ability to repay the loan, the underlying collateral values, and the industry in which the customer operates, (ii) allowances based on actual historical loss experience for similar types of loans in our loan portfolio, and (iii) allowances based on general economic conditions, changes in the mix of loans, company resources, border risk and credit quality indicators, among other things. Our management continually reviews the allowance for loan losses of the Subsidiary Banks using the amounts determined from the allowances established on specific impaired loans, the allowance established on quantitative historical loss percentages, and the allowance based on qualitative data to establish an appropriate amount to maintain in our allowance for probable loan losses. Should any of the factors considered by management in evaluating the adequacy of the allowance for probable loan losses change, our estimate of probable loan losses could also change, which could affect the level of future provisions for probable loan losses. While the calculation of the allowance for probable loan losses utilizes management’s best judgment and all information available, the adequacy of the allowance is dependent on a variety of factors beyond our control, including, among other things, the performance of the entire loan portfolio, the economy, changes in interest rates and the view of regulatory authorities towards loan classifications. The loan loss provision is determined using the following methods. On a weekly basis, loan past due reports are reviewed by the credit quality committee to determine if a loan has any potential problems and if a loan should be placed on our internal classified report. Additionally, our credit department reviews the majority of our loans for proper internal classification purposes regardless of whether they are past due and segregates any loans with potential problems for further review. The credit department will discuss the potential problem loans with the servicing loan officers to determine any relevant issues that were not discovered in the evaluation. Also, an analysis of loans that is provided through examinations by regulatory authorities is considered in the review process. After the above analysis is completed, we will determine if a loan should be placed on an internal classified report because of issues related to the analysis of the credit, credit documents, collateral and/or payment history. World and U.S. economic conditions have continued to improve; however, there remains some uncertainty created by continued issues with negative demographic trends, weak labor participation rates, enormous government debt, excessive regulations, and unfunded entitlement programs that could create a financial crisis. The impact to the world and U.S. economy from these issues is being magnified by a lack of appropriate government action to find solutions to the problems. Economic risk factors are minimized by the underwriting standards of the Subsidiary Banks. The general underwriting standards encompass the following principles: (i) the financial strength of the borrower including strong earnings, a high net worth, significant liquidity and an acceptable debt to worth ratio, (ii) managerial and business competence, (iii) the ability to repay, (iv) for a new business, projected cash flows, (v) loan to value, (vi) in the case of a secondary guarantor, a guarantor financial statement, and (vii) financial and/or other character references. Although the underwriting standards reduce the risk of loss, unique risk factors exist in each type of loan in which the Subsidiary Banks invest. Commercial and industrial loans are mostly secured by the collateral pledged by the borrower that is directly related to the business activities of the company such as accounts receivable and inventory. The ability of the borrower to collect accounts receivable, and to turn inventory into sales are risk factors in the repayment of the loan. Construction and land development loans can carry risk of repayment when projects incur cost overruns, have an increase in the price of building materials, encounter zoning and environmental issues, or encounter other factors that may affect the completion of a project on time and on budget. Additionally, repayment risk may be negatively impacted when the market experiences a deterioration in the value of real estate. Risks specifically related to 1‑4 family development loans also include the practice by the mortgage industry of more restrictive underwriting standards, which inhibits the buyer from obtaining long term financing and excessive housing and lot inventory in the market. Commercial real estate loans demonstrate a risk of repayment when market values deteriorate, the business experiences turnover in key management, the business has an inability to attract or keep occupancy levels stable, or when the market experiences an exit of a specific business industry that is significant to the local economy, such as a manufacturing plant. First and second lien residential 1-4 family mortgage and consumer loan repayments may be affected by unemployment or underemployment and deteriorating market values of real estate. A summary of the changes in the allowance for probable loan losses by loan class is as follows: December 31, 2018 Domestic Foreign Commercial real estate: other Commercial construction & real estate: Commercial land farmland & real estate: Residential: Residential: Commercial development commercial multifamily first lien junior lien Consumer Foreign Total (Dollars in Thousands) Balance at December 31, $ 27,905 $ 11,675 $ 16,663 $ 1,109 $ 2,950 $ 6,103 $ 440 $ 842 $ 67,687 Losses charge to allowance (14,220) (1) (70) — (122) (347) (362) (3) (15,125) Recoveries credited to allowance 1,981 25 246 — 36 369 43 10 2,710 Net losses charged to allowance (12,239) 24 176 — (86) 22 (319) 7 (12,415) Provision (credit) charged to operations (3,070) 3,424 2,514 699 603 1,594 326 22 6,112 Balance at December 31, $ 12,596 $ 15,123 $ 19,353 $ 1,808 $ 3,467 $ 7,719 $ 447 $ 871 $ 61,384 December 31, 2017 Domestic Foreign Commercial real estate: other Commercial construction & real estate: Commercial land farmland & real estate: Residential: Residential: Commercial development commercial multifamily first lien junior lien Consumer Foreign Total (Dollars in Thousands) Balance at December 31, $ 25,649 $ 13,889 $ 16,731 $ 806 $ 2,455 $ 3,716 $ 531 $ 884 $ 64,661 Losses charge to allowance (12,094) (213) (40) — (101) (340) (309) (1) (13,098) Recoveries credited to allowance 4,020 21 527 — 11 258 45 21 4,903 Net losses charged to allowance (8,074) (192) 487 — (90) (82) (264) 20 (8,195) Provision (credit) charged to operations 10,330 (2,022) (555) 303 585 2,469 173 (62) 11,221 Balance at December 31, $ 27,905 $ 11,675 $ 16,663 $ 1,109 $ 2,950 $ 6,103 $ 440 $ 842 $ 67,687 December 31, 2016 Domestic Foreign Commercial real estate: other Commercial construction & real estate: Commercial land farmland & real estate: Residential: Residential: Commercial development commercial multifamily first lien junior lien Consumer Foreign Total (Dollars in Thousands) Balance at December 31, $ 21,431 $ 13,920 $ 19,769 $ 1,248 $ 3,509 $ 5,321 $ 638 $ 1,152 $ 66,988 Losses charge to allowance (32,959) (16) (1,890) (180) (70) (331) (414) (41) (35,901) Recoveries credited to allowance 7,110 6,099 119 — 21 278 69 19 13,715 Net losses charged to allowance (25,849) 6,083 (1,771) (180) (49) (53) (345) (22) (22,186) Provision (credit) charged to operations 30,067 (6,114) (1,267) (262) (1,005) (1,552) 238 (246) 19,859 Balance at December 31, $ 25,649 $ 13,889 $ 16,731 $ 806 $ 2,455 $ 3,716 $ 531 $ 884 $ 64,661 The allowance for probable loan losses is a reserve established through a provision for probable loan losses charged to expense, which represents management’s best estimate of probable loan losses when evaluating loans (i) individually or (ii) collectively. The decrease in the provision for probable loan losses charged to expense for the years ended December 31, 2018 and December 31, 2017 can be attributed to a decrease in the historical loss experience in the commercial category of the calculation. As discussed in prior periods, charge-offs increased from historical levels due to the deterioration of one relationship that was secured by multiple pieces of transportation equipment beginning in the fourth quarter of 2014. We use a three-year historical charge-off experience in the calculation, therefore, as those charge-offs are eliminated from the calculation, the allowance for probable loan losses is impacted. As fluctuations occur in historical loss factors, management evaluates the need to adjust the qualitative factors used in the calculation to properly reflect probable loan losses. The increase in losses charged to the allowance for probable loan losses for the year ended December 31, 2016 can be attributed to further deterioration in the previously identified and charged down relationship primarily secured by multiple pieces of transportation equipment. In March 2016, litigation against the management of the borrower was filed in the State of Nevada, resulting in a going concern issue with the borrower’s operations and the future use of the transportation equipment pledged as collateral on the relationship. As a result, management, in accordance with its credit review procedures, re-evaluated the collateral values on the equipment in light of the new circumstances and reduced the collateral values accordingly, resulting in a further charge-down of the relationship of approximately $19.4 million, which is included in the losses charged to the allowance in the commercial category in the table detailing the year ended December 31, 2016 activity. The table below provides additional information on the balance of loans individually or collectively evaluated for impairment and their related allowance, by loan class: December 31, 2018 Loans Individually Loans Collectively Evaluated For Evaluated For Impairment Impairment Recorded Recorded Investment Allowance Investment Allowance (Dollars in Thousands) Domestic Commercial $ 9,179 $ 656 $ 1,119,790 $ 11,940 Commercial real estate: other construction & land development 2,092 116 1,884,139 15,007 Commercial real estate: farmland & commercial 3,509 — 1,946,389 19,353 Commercial real estate: multifamily 507 — 225,750 1,808 Residential: first lien 6,244 — 439,556 3,467 Residential: junior lien 901 — 726,400 7,719 Consumer 1,175 — 45,141 447 Foreign 293 — 150,224 871 Total $ 23,900 $ 772 $ 6,537,389 $ 60,612 December 31, 2017 Loans Individually Loans Collectively Evaluated For Evaluated For Impairment Impairment Recorded Recorded Investment Allowance Investment Allowance (Dollars in Thousands) Domestic Commercial $ 17,947 $ 300 $ 1,068,520 $ 27,605 Commercial real estate: other construction & land development 2,455 116 1,681,095 11,559 Commercial real estate: farmland & commercial 33,123 18 2,010,162 16,645 Commercial real estate: multifamily 476 — 192,440 1,109 Residential: first lien 6,852 — 425,925 2,950 Residential: junior lien 723 — 700,025 6,103 Consumer 1,281 — 48,262 440 Foreign 347 — 158,539 842 Total $ 63,204 $ 434 $ 6,284,968 $ 67,253 The decrease in loans individually evaluated for impairment at December 31, 2018 compared to December 31, 2017, can be attributed to the foreclosure on a relationship primarily secured by a water park and the foreclosure of the collateral on a relationship secured by multiple pieces of transportation equipment. The foreclosure of the collateral securing the two relationships is also impacting the balances reported as impaired loans in the following tables. Loans accounted for on a non‑accrual basis at December 31, 2018, 2017 and 2016 amounted to $15,791,000, $54,730,000 and $37,245,000, respectively. The effect of such non‑accrual loans reduced interest income by approximately $1,119,000, $977,000 and $2,461,000 for the years ended December 31, 2018, 2017 and 2016, respectively. Amounts received on non‑accruals are applied, for financial accounting purposes, first to principal and then to interest after all principal has been collected. Accruing loans contractually past due 90 days or more as to principal or interest payments at December 31, 2018, 2017 and 2016 amounted to approximately $40,674,000, $7,257,000 and $5,226,000, respectively and can be attributed to a relationship that is secured by multiple pieces of real property on which car dealerships are operated. The table below provides additional information on loans accounted for on a non‑accrual basis by loan class: December 31, 2018 December 31, 2017 (Dollars in Thousands) Domestic Commercial $ 9,143 $ 17,909 Commercial real estate: other construction & land development 2,092 2,455 Commercial real estate: farmland & commercial 3,509 33,123 Commercial real estate: multifamily 507 476 Residential: first lien 347 712 Residential: junior lien 171 11 Consumer 22 44 Total non-accrual loans $ 15,791 $ 54,730 Impaired loans are those loans where it is probable that all amounts due according to contractual terms of the loan agreement will not be collected. We have identified these loans through our normal loan review procedures. Impaired loans are measured based on (i) the present value of expected future cash flows discounted at the loan’s effective interest rate; (ii) the loan’s observable market price; or (iii) the fair value of the collateral if the loan is collateral dependent. Substantially all of our impaired loans are measured at the fair value of the collateral. In limited cases, we may use other methods to determine the level of impairment of a loan if such loan is not collateral dependent. The following tables detail key information regarding our impaired loans by loan class for the year ended December 31, 2018: December 31, 2018 Unpaid Average Recorded Principal Related Recorded Interest Investment Balance Allowance Investment Recognized (Dollars in Thousands) Loans with Related Allowance Domestic Commercial $ 1,563 $ 2,161 $ 656 $ 1,741 $ — Commercial real estate: other construction & land development 135 169 116 141 — Total impaired loans with related allowance $ 1,698 $ 2,330 $ 772 $ 1,882 $ — December 31, 2018 Unpaid Average Recorded Principal Recorded Interest Investment Balance Investment Recognized (Dollars in Thousands) Loans with No Related Allowance Domestic Commercial $ 7,616 $ 7,730 $ 16,194 $ 3 Commercial real estate: other construction & land development 1,957 2,205 2,151 — Commercial real estate: farmland & commercial 3,509 4,031 36,632 — Commercial real estate: multifamily 507 538 565 — Residential: first lien 6,244 6,386 7,136 305 Residential: junior lien 901 911 976 44 Consumer 1,175 1,190 1,211 2 Foreign 293 293 327 14 Total impaired loans with no related allowance $ 22,202 $ 23,284 $ 65,192 $ 368 The following tables detail key information regarding our impaired loans by loan class for the year ended December 31, 2017: December 31, 2017 Unpaid Average Recorded Principal Related Recorded Interest Investment Balance Allowance Investment Recognized (Dollars in Thousands) Loans with Related Allowance Domestic Commercial real estate: other construction & land development $ 1,300 $ 1,577 $ 300 1,346 — Commercial real estate: farmland & commercial 145 169 116 150 — Commercial real estate: multifamily 449 590 18 489 — Total impaired loans with related allowance $ 1,894 $ 2,336 $ 434 $ 1,985 $ — December 31, 2017 Unpaid Average Recorded Principal Recorded Interest Investment Balance Investment Recognized (Dollars in Thousands) Loans with No Related Allowance Domestic Commercial $ 16,646 $ 44,095 $ 19,615 $ 3 Commercial real estate: other construction & land development 2,310 2,455 3,493 — Commercial real estate: farmland & commercial 32,675 33,275 38,536 — Commercial real estate: multifamily 476 505 511 — Residential: first lien 6,852 6,968 7,249 324 Residential: junior lien 723 736 970 45 Consumer 1,281 1,283 1,293 3 Foreign 347 347 750 16 Total impaired loans with no related allowance $ 61,310 $ 89,664 $ 72,417 $ 391 A portion of the impaired loans have adequate collateral and credit enhancements not requiring a related allowance for loan loss. Management is confident our loss exposure regarding these credits will be significantly reduced due to our long‑standing practices that emphasize secured lending with strong collateral positions and guarantor support. Management is likewise confident the reserve for probable loan losses is adequate. Management recognizes the risks associated with these impaired loans. However, management's decision to place loans in this category does not necessarily mean that losses will occur. In the current environment, troubled loan management can be protracted because of the legal and process problems that delay the collection of an otherwise collectible loan. Additionally, management believes that the collateral related to these impaired loans and/or the secondary support from guarantors mitigates the potential for losses from impaired loans. The following table details loans accounted for as “troubled debt restructuring,” segregated by loan class. Loans accounted for as troubled debt restructuring are included in impaired loans. December 31, 2018 December 31, 2017 (Dollars in Thousands) Domestic Commercial $ 35 $ 6,910 Commercial real estate: farmland & commercial — — Residential: first lien 5,947 6,140 Residential: junior lien 730 712 Consumer 1,153 1,237 Foreign 293 347 Total troubled debt restructuring $ 8,158 $ 15,346 The Subsidiary Banks charge-off that portion of any loan which management considers to represent a loss, as well as that portion of any other loan which is classified as a “loss” by bank examiners. Commercial and industrial or real estate loans are generally considered by management to represent a loss, in whole or part, when an exposure beyond any collateral coverage is apparent and when no further collection of the loss portion is anticipated based on the borrower’s financial condition and general economic conditions in the borrower’s industry. Generally, unsecured consumer loans are charged‑off when 90 days past due. While management considers that it is generally able to identify borrowers with financial problems reasonably early and to monitor credit extended to such borrowers carefully, there is no precise method of predicting loan losses. The determination that a loan is likely to be uncollectible and that it should be wholly or partially charged‑off as a loss is an exercise of judgment. Similarly, the determination of the adequacy of the allowance for probable loan losses can be made only on a subjective basis. It is the judgment of our management that the allowance for probable loan losses at December 31, 2018 and December 31, 2017, was adequate to absorb probable losses from loans in the portfolio at that date. The following table presents information regarding the aging of past due loans by loan class: December 31, 2018 90 Days or Total 30 - 59 60 - 89 90 Days or greater & Past Total Days Days Greater still accruing Due Current Portfolio (Dollars in Thousands) Domestic Commercial $ 4,651 $ 1,089 $ 19,851 $ 10,890 $ 25,591 $ 1,103,378 $ 1,128,969 Commercial real estate: other construction & land development 727 1,707 922 16 3,356 1,882,875 1,886,231 Commercial real estate: farmland & commercial 2,928 784 27,239 24,910 30,951 1,918,947 1,949,898 Commercial real estate: multifamily 927 — 578 71 1,505 224,752 226,257 Residential: first lien 3,998 1,677 3,362 3,079 9,037 436,763 445,800 Residential: junior lien 1,155 618 1,108 937 2,881 724,420 727,301 Consumer 486 19 45 32 550 45,766 46,316 Foreign 1,106 117 739 739 1,962 148,555 150,517 Total past due loans $ 15,978 $ 6,011 $ 53,844 $ 40,674 $ 75,833 $ 6,485,456 $ 6,561,289 December 31, 2017 90 Days or Total 30 - 59 60 - 89 90 Days or greater & Past Total Days Days Greater still accruing Due Current Portfolio (Dollars in Thousands) Domestic Commercial $ 3,790 $ 398 $ 18,308 $ 537 $ 22,496 $ 1,063,971 $ 1,086,467 Commercial real estate: other construction & land development 354 308 820 6 1,482 1,682,068 1,683,550 Commercial real estate: farmland & commercial 3,925 518 31,133 954 35,576 2,007,709 2,043,285 Commercial real estate: multifamily 84 — 476 — 560 192,356 192,916 Residential: first lien 4,295 2,458 4,095 3,861 10,848 421,929 432,777 Residential: junior lien 1,310 580 1,110 1,099 3,000 697,748 700,748 Consumer 868 98 160 133 1,126 48,417 49,543 Foreign 1,229 69 667 667 1,965 156,921 158,886 Total past due loans $ 15,855 $ 4,429 $ 56,769 $ 7,257 $ 77,053 $ 6,271,119 $ 6,348,172 The increase in the commercial real estate: farmland and commercial in the 90 days and greater category at December 31, 2018 compared to December 31, 2017 can be attributed to a relationship that is secured by multiple pieces of real property on which car dealerships are operated. The allowance based on historical loss experience on our remaining loan portfolio, which includes the “Special Review Credits,” “Watch List—Pass Credits,” and “Watch List—Substandard Credits” is determined by segregating the remaining loan portfolio into certain categories such as commercial loans, installment loans, international loans, loan concentrations and overdrafts. Installment loans are then further segregated by number of days past due. A historical loss percentage, adjusted for (i) management’s evaluation of changes in lending policies and procedures, (ii) current economic conditions in the market area served, (iii) other risk factors, (iv) the effectiveness of the internal loan review function, (v) changes in loan portfolios, and (vi) the composition and concentration of credit volume is applied to each category. Each category is then added together to determine the allowance allocated under ASC 450‑20. A summary of the loan portfolio by credit quality indicator by loan class is as follows: December 31, 2018 Special Watch Watch List— Watch List— Pass Review List—Pass Substandard Impaired (Dollars in Thousands) Domestic Commercial $ 998,625 $ 441 $ 44,544 $ 76,180 $ 9,179 Commercial real estate: other construction & land development 1,817,098 1,648 9,055 56,338 2,092 Commercial real estate: farmland & commercial 1,726,711 62,046 38,373 119,259 3,509 Commercial real estate: multifamily 224,823 — — 927 507 Residential: first lien 438,773 — 142 641 6,244 Residential: junior lien 725,538 — 862 — 901 Consumer 45,141 — — — 1,175 Foreign 150,224 — — — 293 Total $ 6,126,933 $ 64,135 $ 92,976 $ 253,345 $ 23,900 December 31, 2017 Special Watch Watch List— Watch List— Pass Review List—Pass Substandard Impaired (Dollars in Thousands) Domestic Commercial $ 905,707 $ — $ 3,170 $ 159,643 $ 17,947 Commercial real estate: other construction & land development 1,616,604 1,288 672 62,531 2,455 Commercial real estate: farmland & commercial 1,863,763 5,134 41,820 99,445 33,123 Commercial real estate: multifamily 192,440 — — — 476 Residential: first lien 425,811 40 — 74 6,852 Residential: junior lien 699,875 150 — — 723 Consumer 48,262 — — — 1,281 Foreign 158,539 — — — 347 Total $ 5,911,001 $ 6,612 $ 45,662 $ 321,693 $ 63,204 The increase in special review credits in the commercial real estate: farmland and commercial for December 31, 2018 compared to December 31, 2017 can be attributed to a relationship secured by children’s learning centers reclassified from the Pass category. The increase in Watch-List Pass commercial credits can be attributed to the reclassification of a relationship in the oil and gas production business from Watch-List Substandard. The decrease in Watch-List Substandard for December 31, 2018 can be attributed to the payoff of a relationship secured by barges used in the transportation of petroleum products, the reclassification of a relationship secured by accounts receivable to Pass and the previously mentioned reclassification of the relationship in the oil and gas production business to Watch-List Pass. The increase in Watch-List Substandard commercial credits for December 31, 2018 can be attributed to a relationship secured by real property on which car dealerships are operated from the Pass category. The decrease in Watch-List Impaired credits in the commercial real estate: farmland and commercial at December 31, 2018 can be attributed to the foreclosure of a loan relationship primarily secured by a water park. |
Bank Premises and Equipment
Bank Premises and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Bank Premises and Equipment | |
Bank Premises and Equipment | (5) Bank Premises and Equipment A summary of bank premises and equipment, by asset classification, at December 31, 2018 and 2017 were as follows: Estimated useful lives 2018 2017 (Dollars in Thousands) Bank buildings and improvements 5 - 40 years $ 563,302 $ 550,094 Furniture, equipment and vehicles 1 - 20 years 292,958 289,743 Land 118,806 123,087 Real estate held for future expansion: Land, building, furniture, fixture and equipment 7 - 27 years — — Less: accumulated depreciation (468,167) (448,470) Bank premises and equipment, net $ 506,899 $ 514,454 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Other Intangible Assets | |
Goodwill and Other Intangible Assets | (6) Goodwill and Other Intangible Assets The majority of our identified intangibles are in the form of amortizable core deposit premium. A small portion of the fully amortized identified intangibles represent identified intangibles in the acquisition of the rights to the insurance agency contracts of InsCorp, Inc., acquired in 2008. Information on our identified intangible assets follows: Carrying Accumulated Amount Amortization Net (Dollars in Thousands) December 31, 2018: Core deposit premium $ 58,675 $ 58,675 $ — Identified intangible (contract rights) 2,022 2,022 — Total identified intangibles $ 60,697 $ 60,697 $ — December 31, 2017: Core deposit premium $ 58,675 $ 58,675 $ — Identified intangible (contract rights) 2,022 2,022 — Total identified intangibles $ 60,697 $ 60,697 $ — Amortization expense of intangible assets for the years ended December 31, 2018, 2017 and 2016, was $0, $0 and $25,000, respectively. There were no changes in the carrying amount of goodwill for the years ended December 31, 2018 and 2017. |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2018 | |
Deposits. | |
Deposits | (7) Deposits Deposits as of December 31, 2018 and 2017 and related interest expense for the years ended December 31, 2018, 2017 and 2016 were as follows: 2018 2017 (Dollars in Thousands) Deposits: Demand - non-interest bearing Domestic $ 2,758,768 $ 2,609,932 Foreign 696,072 633,323 Total demand non-interest bearing 3,454,840 3,243,255 Savings and interest bearing demand Domestic 2,531,854 2,615,143 Foreign 736,383 629,988 Total savings and interest bearing demand 3,268,237 3,245,131 Time, certificates of deposit $100,000 or more Domestic 590,895 637,006 Foreign 807,486 808,881 Less than $100,000 Domestic 323,377 354,998 Foreign 251,710 255,621 Total time, certificates of deposit 1,973,468 2,056,506 Total deposits $ 8,696,545 $ 8,544,892 2018 2017 2016 (Dollars in Thousands) Interest expense: Savings and interest bearing demand Domestic $ 11,029 $ 5,453 $ 3,922 Foreign 1,735 755 640 Total savings and interest bearing demand 12,764 6,208 4,562 Time, certificates of deposit $100,000 or more Domestic 4,741 3,644 3,881 Foreign 5,798 4,105 3,929 Less than $100,000 Domestic 1,589 1,312 1,447 Foreign 968 675 706 Total time, certificates of deposit 13,096 9,736 9,963 Total interest expense on deposits $ 25,860 $ 15,944 $ 14,525 Scheduled maturities of time deposits as of December 31, 2018 were as follows: Total (in thousands) 2019 $ 1,786,776 2020 138,105 2021 31,665 2022 15,717 2023 1,096 Thereafter 109 Total $ 1,973,468 Scheduled maturities of time deposits in amounts of $100,000 or more at December 31, 2018, were as follows: Total (in thousands) Due within 3 months or less $ 500,836 Due after 3 months and within 6 months 337,349 Due after 6 months and within 12 months 433,628 Due after 12 months 126,568 $ 1,398,381 Time deposits that meet or exceed the FDIC insurance limit of $250,000 at December 31, 2018 and December 31, 2017 were $869,000 and $894,000, in thousands, respectively. |
Securities Sold Under Repurchas
Securities Sold Under Repurchase Agreements | 12 Months Ended |
Dec. 31, 2018 | |
Securities Sold Under Repurchase Agreements | |
Securities Sold Under Repurchase Agreements | (8) Securities Sold Under Repurchase Agreements Our Subsidiary Banks have entered into repurchase agreements with an investment banking firm and individual customers of the Subsidiary Banks. The purchasers have agreed to resell to the Subsidiary Banks identical securities upon the maturities of the agreements. Securities sold under repurchase agreements were mortgage‑backed securities and averaged $314,876,000 and $402,396,000 during 2018 and 2017, respectively, and the maximum amount outstanding at any month end during 2018 and 2017 was $370,495,000 and $514,616,000 respectively. Further information related to repurchase agreements at December 31, 2018 and 2017 is set forth in the following table: Collateral Securities Repurchase Borrowing Book Value of Fair Value of Balance of Weighted Average Securities Sold Securities Sold Liability Interest Rate (Dollars in Thousands) December 31, 2018 term: Overnight agreements $ 357,642 $ 349,081 $ 218,852 0.85 % 1 to 29 days — — — — 30 to 90 days — — — — Over 90 days 11,444 11,096 11,137 1.27 Total $ 369,086 $ 360,177 $ 229,989 0.87 % December 31, 2017 term: Overnight agreements $ 340,054 $ 334,506 $ 242,824 0.25 % 1 to 29 days — — — — 30 to 90 days 109,300 107,238 100,000 3.99 Over 90 days 11,327 11,168 10,981 0.74 Total $ 460,681 $ 452,912 $ 353,805 1.32 % The book value and fair value of securities sold includes the entire book value and fair value of securities partially or fully pledged under repurchase agreements. |
Other Borrowed Funds
Other Borrowed Funds | 12 Months Ended |
Dec. 31, 2018 | |
Other Borrowed Funds | |
Other Borrowed Funds | (9) Other Borrowed Funds Other borrowed funds include Federal Home Loan Bank borrowings, which are short and long‑term fixed borrowings issued by the Federal Home Loan Bank of Dallas and the Federal Home Loan Bank of Topeka at the market price offered at the time of funding. These borrowings are secured by mortgage‑backed investment securities and a portion of our loan portfolio. Further information regarding our other borrowed funds at December 31, 2018 and 2017 is set forth in the following table: December 31, 2018 2017 (Dollars in Thousands) Federal Home Loan Bank advances—short-term Balance at year end $ 268,975 $ 945,225 Rate on balance outstanding at year end 2.70 % 1.44 % Average daily balance $ 621,357 $ 839,858 Average rate 1.97 % 1.23 % Maximum amount outstanding at any month end $ 1,007,100 $ 1,043,250 Federal Home Loan Bank advances—long-term (1) Balance at year end $ 436,690 $ 250,000 Rate on balance outstanding at year end 1.73 % 1.26 % Average daily balance $ 302,373 $ 51,644 Average rate 1.71 % 1.26 % Maximum amount outstanding at any month end $ 436,700 $ 250,000 (1) Long-term advances at December 31, 2018 consisted of both amortizing and non-amortizing advances. The non-amortizing advances mature in the following increments: $75,000,000 in July 2028, $100,000,000 in March 2033 and $250,000,000 in August 2033 and are callable by the FHLB on an annual basis. Two amortizing advances are outstanding at December 31, 2018 in the amounts of $3,200,000 and $8,490,000 and mature in December 2033 and November 2033, respectively. The amortization on the amortizing long-term advances totals approximately $179,000 per year for each of the next five years. Long-term advances outstanding at December 31, 2017 mature in the following increments: $100,000,000 in November 2027 and $150,000,000 in December 2027 and are callable by the FHLB on a quarterly basis. |
Junior Subordinated Interest De
Junior Subordinated Interest Deferrable Debentures | 12 Months Ended |
Dec. 31, 2018 | |
Junior Subordinated Interest Deferrable Debentures | |
Junior Subordinated Interest Deferrable Debentures | (10) Junior Subordinated Deferrable Interest Debentures We have formed six statutory business trusts under the laws of the State of Delaware for the purpose of issuing trust preferred securities. These statutory business trusts (the “Trusts”) have each issued Capital and Common Securities and invested the proceeds thereof in an equivalent amount of junior subordinated debentures (the “Debentures”) we issued. As of December 31, 2018 and December 31, 2017, the principal amount of debentures outstanding totaled $160,416,000. The Debentures are subordinated and junior in right of payment to all our present and future senior indebtedness (as defined in the respective indentures) and are pari passu with one another. The interest rate payable on, and the payment terms of the Debentures are the same as the distribution rate and payment terms of the respective issues of Capital and Common Securities issued by the Trusts. We have fully and unconditionally guaranteed the obligations of each of the Trusts with respect to the Capital and Common Securities. We have the right, unless an Event of Default (as defined in the Indentures) has occurred and is continuing, to defer payment of interest on the Debentures for up to twenty consecutive quarterly periods on Trusts VI, VIII, IX, X, XI and XII. If interest payments on any of the Debentures are deferred, distributions on both the Capital and Common Securities related to that Debenture would also be deferred. The redemption prior to maturity of any of the Debentures may require the prior approval of the Federal Reserve and/or other regulatory bodies. For financial reporting purposes, the Trusts are treated as investments and not consolidated in the consolidated financial statements. Although the Capital Securities issued by each of the Trusts are not included as a component of shareholders’ equity on the consolidated statement of condition, the Capital Securities are treated as capital for regulatory purposes. Specifically, under applicable regulatory guidelines, the Capital Securities issued by the Trusts qualify as Tier 1 capital up to a maximum of 25% of Tier 1 capital on an aggregate basis. Any amount that exceeds the 25% threshold would qualify as Tier 2 capital. At December 31, 2018 and December 31, 2017, the total $160,416,000 of the Capital Securities outstanding qualified as Tier 1 capital. The following table illustrates key information about each of the Debentures and their interest rates at December 31, 2018: Junior Subordinated Deferrable Interest Repricing Interest Interest Optional Debentures Frequency Rate Rate Index(1) Maturity Date Redemption Date (1) (Dollars in Thousands) Trust VI $ 25,774 Quarterly 6.07 % LIBOR + November 2032 February 2008 Trust VIII 25,774 Quarterly 5.49 % LIBOR + October 2033 October 2008 Trust IX 41,238 Quarterly 4.02 % LIBOR + October 2036 October 2011 Trust X 21,021 Quarterly 4.19 % LIBOR + February 2037 February 2012 Trust XI 25,990 Quarterly 4.02 % LIBOR + July 2037 July 2012 Trust XII 20,619 Quarterly 4.19 % LIBOR + September 2037 September 2012 $ 160,416 (1) The Capital Securities may be redeemed in whole or in part on any interest payment date after the Optional Redemption Date. |
Earnings per Share ("EPS")
Earnings per Share ("EPS") | 12 Months Ended |
Dec. 31, 2018 | |
Earnings per Share ("EPS") | |
Earnings per Share ("EPS") | (11) Earnings per Share (“EPS”) Basic EPS is calculated by dividing net income by the weighted average number of common shares outstanding. The computation of diluted EPS assumes the issuance of common shares for all dilutive potential common shares outstanding during the reporting period. The calculation of the basic EPS and the diluted EPS for the years ended December 31, 2018, 2017, and 2016 is set forth in the following table: Net Income Shares Per Share (Numerator) (Denominator) Amount (Dollars in Thousands, Except Per Share Amounts) December 31, 2018: Basic EPS Net income available to common shareholders $ 215,931 66,106,580 $ 3.27 Potential dilutive common shares and warrants — 527,240 Diluted EPS $ 215,931 66,633,820 $ 3.24 December 31, 2017: Basic EPS Net income available to common shareholders $ 157,436 66,046,155 $ 2.38 Potential dilutive common shares and warrants — 732,281 Diluted EPS $ 157,436 66,778,436 $ 2.36 December 31, 2016: Basic EPS Net income available to common shareholders $ 133,932 65,967,989 $ 2.03 Potential dilutive common shares — 345,501 Diluted EPS $ 133,932 66,313,490 $ 2.02 |
Employees' Profit Sharing Plan
Employees' Profit Sharing Plan | 12 Months Ended |
Dec. 31, 2018 | |
Employees' Profit Sharing Plan | |
Employees' Profit Sharing Plan | (12) Employees’ Profit Sharing Plan We have a deferred profit sharing plan for full‑time employees with a minimum of one year of continuous employment. Our annual contribution to the plan is based on a percentage, as determined by our Board of Directors, of income before income taxes, as defined, for the year. Allocation of the contribution among officers and employees’ accounts is based on length of service and amount of salary earned. Profit sharing costs of $3,850,000 $3,750,000 and $3,650,000 were charged to income for the years ended December 31, 2018, 2017, and 2016, respectively. |
International Operations
International Operations | 12 Months Ended |
Dec. 31, 2018 | |
International Operations | |
International Operations | (13) International Operations We provide international banking services for our customers through our Subsidiary Banks. Neither we nor our Subsidiary Banks have facilities located outside the United States. International operations are distinguished from domestic operations based upon the domicile of the customer. Because the resources we employ are common to both international and domestic operations, it is not practical to determine net income generated exclusively from international activities. A summary of assets attributable to international operations at December 31, 2018 and 2017 are as follows: 2018 2017 (Dollars in Thousands) Loans: Commercial $ 101,955 $ 113,019 Others 48,562 45,867 150,517 158,886 Less allowance for probable loan losses (842) Net loans $ 149,646 $ 158,044 Accrued interest receivable $ 811 $ 671 At December 31, 2018, we had $119,302,000 in outstanding standby and commercial letters of credit to facilitate trade activities. Revenues directly attributable to international operations were approximately $5,412,000, $5,248,000 and $5,495,000 for the years ended December 31, 2018, 2017 and 2016, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes | |
Income Taxes | (14) Income Taxes We file a consolidated U.S. Federal and State income tax return. The current and deferred portions of net income tax expense included in the consolidated statements of income are presented below for the years ended December 31: 2018 2017 2016 (Dollars in Thousands) Current U.S. $ 48,144 $ 56,974 $ 52,403 State 3,370 2,662 3,362 Foreign (5) — — Total current taxes 51,509 59,636 55,765 Deferred U.S. 5,130 4,620 7,279 State 13 (50) 27 Total deferred taxes 5,143 4,570 7,306 Total income taxes $ 56,652 $ 64,206 $ 63,071 Total income tax expense differs from the amount computed by applying the U.S. Federal income tax rate of 21% for 2018 and 35% for 2017 and 2016 to income before income taxes. The reasons for the differences for the years ended December 31 are as follows: 2018 2017 2016 (Dollars in Thousands) Computed expected tax expense $ 57,831 $ 77,643 $ 69,253 Change in taxes resulting from: Tax-exempt interest income (3,101) (4,701) (3,940) State tax, net of federal income taxes, tax credit and refunds 2,673 1,697 3,287 Resolution of IRS exam — (4,985) — Other investment income (1,561) (3,198) (3,694) Deferred tax adjustment due to federal tax rate change (1,618) (3,168) — Net investment expense, low income housing investments 2,518 387 — Other (90) 531 (1,835) Actual tax expense $ 56,652 $ 64,206 $ 63,071 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2018 and 2017 are reflected below: 2018 2017 (Dollars in Thousands) Deferred tax assets: Loans receivable, principally due to the allowance for probable loan losses $ 12,257 $ 14,546 Other real estate owned 2,459 2,053 Impairment charges on available-for-sale securities 1,054 844 Accrued expenses 81 81 Net unrealized losses on available for sale investment securities 15,182 9,680 Other 5,076 4,434 Total deferred tax assets 36,109 31,638 Deferred tax liabilities: Bank premises and equipment, principally due to differences on depreciation (12,596) (10,940) Identified intangible assets and goodwill (13,490) (13,417) Other (14,787) (12,474) Total deferred tax liabilities (40,873) (36,831) Net deferred tax liability $ (4,764) $ (5,193) The net deferred tax liability of $4,764,000 at December 31, 2018 and $5,193,000 at December 31, 2017 is included in other liabilities in the consolidated statements of condition. On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Act”) was signed into law. The Tax Act materially changes U.S. corporate income tax rates, among other things. We were in a net deferred tax liability position at the time the Tax Act was enacted and subsequently revalued the carrying value of the net deferred liability and its components to the new 21% effective tax rate. The change in the tax rate resulted in a net benefit to us of $4,786,000 and was included as a reduction to income tax expense in the consolidated income statement. |
Stock Options
Stock Options | 12 Months Ended |
Dec. 31, 2018 | |
Stock Options | |
Stock Options | (15) Stock Options On April 5, 2012, the Board of Directors adopted the 2012 International Bancshares Corporation Stock Option Plan (the “2012 Plan”). There are 800,000 shares available for stock option grants under the 2012 Plan. Under the 2012 Plan, both qualified incentive stock options (“ISOs”) and non‑qualified stock options (“NQSOs”) may be granted. Options granted may be exercisable for a period of up to 10 years from the date of grant, excluding ISOs granted to 10% shareholders, which may be exercisable for a period of up to only five years. As of December 31, 2018, 10,700 shares were available for future grants under the 2012 Plan. The fair value of each option award granted under the plan is estimated on the date of grant using a Black‑Scholes‑Merton option valuation model that uses the assumptions noted in the following table. Expected volatility is based on the historical volatility of the price of our stock. We use historical data to estimate the expected dividend yield and employee termination rates within the valuation model. The expected term of options is derived from historical exercise behavior. The risk‑free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. 2018 2017 Expected Life (Years) 7.00 — Dividend yield 1.73 % — % Interest rate 2.68 % — % Volatility 31.65 % — % (1) No stock options were granted during the twelve months ended December 31, 2017. A summary of option activity under the stock option plans for the twelve months ended December 31, 2018 is as follows: Weighted Weighted average average remaining Aggregate Number of exercise contractual intrinsic options price term (years) value ($) (in Thousands) Options outstanding at December 31, 2017 668,166 $ Plus: Options granted 234,700 Less: Options exercised 84,701 Options expired — — Options forfeited 29,188 Options outstanding at December 31, 2018 788,977 $ 7,587 Options fully vested and exercisable at December 31, 2018 310,108 $ $ 4,486 Stock‑based compensation expense included in the consolidated statements of income for the years ended December 31, 2018, 2017 and 2016 was approximately $1,035,000, $903,000 and $1,082,000, respectively. As of December 31, 2018, there was approximately $2,798,000 of total unrecognized stock‑based compensation cost related to non‑vested options granted under our plans that will be recognized over a weighted average period of 2.1 years. Other information pertaining to option activity during the twelve month period ending December 31, 2018, 2017 and 2016 is as follows: Twelve Months Ended December 31, 2018 2017 2016 Weighted average grant date fair value of stock options granted $ 11.78 $ — $ 8.74 Total fair value of stock options vested $ 1,077,000 $ 1,182,000 $ 1,015,000 Total intrinsic value of stock options exercised $ 2,045,000 $ 2,595,000 $ 792,000 (1) No stock options were granted during the twelve months ended December 31, 2017. |
Long Term Restricted Stock Unit
Long Term Restricted Stock Units | 12 Months Ended |
Dec. 31, 2018 | |
Long Term Restricted Stock Units | |
Long Term Restricted Stock Units | (16) Long Term Restricted Stock Units As a former participant in the Troubled Asset Relief Program Capital Purchase Program (the “CPP”) we were subject to certain compensation restrictions, including a prohibition on the payment or accrual of any bonuses to certain officers and employees except for awards of CPP‑compliant long‑ term restricted stock and stock units. On December 18, 2009, our board of directors (the “Board”) adopted the 2009 International Bancshares Corporation Long‑Term Restricted Stock Unit Plan (the “Plan”) to give us additional flexibility in the compensation of our officers, employees, consultants and advisors in compliance with all applicable laws and restrictions. The Plan authorizes us to issue Restricted Stock Units (“RSUs”) to our officers, employees, consultants and advisors. On December 18, 2009, pursuant to the Plan, the Board adopted resolutions creating the Long‑Term Restricted Stock Unit Plan Committee to administer the Plan. RSUs issued under the Plan are not equity and are payable only in cash. The Plan provides for both the issuance of CPP‑compliant long‑term RSUs as well as RSUs that are not CPP‑compliant. No grants have been made under the Plan since December 2012 and there are currently no outstanding grants under the Plan. |
Commitments, Contingent Liabili
Commitments, Contingent Liabilities and Other Tax Matters | 12 Months Ended |
Dec. 31, 2018 | |
Commitments, Contingent Liabilities and Other Tax Matters | |
Commitments, Contingent Liabilities and Other Tax Matters | (17) Commitments, Contingent Liabilities and Other Matters We lease portions of our banking premises and equipment under operating leases. Total rental expense for the years ended December 31, 2018, 2017 and 2016 were approximately $5,257,000, $5,258,000 and $5,870,000, respectively. Future minimum lease payments due under non‑cancellable operating leases at December 31, 2018 were as follows: Fiscal year ending: Total (in thousands) 2019 $ 3,443 2020 3,246 2021 2,272 2022 579 2023 212 Thereafter 275 Total $ 10,027 It is expected that certain leases will be renewed as these leases expire. Aggregate future minimum rentals to be received under non‑cancellable sub‑leases greater than one year at December 31, 2018 were $82,690,000. Cash of approximately $115,721,000 and $116,129,000 at December 31, 2018 and 2017, respectively, was maintained to satisfy regulatory reserve requirements. We are involved in various legal proceedings that are in various stages of litigation. We have determined, based on discussions with our counsel that any material loss in such actions, individually or in the aggregate, is remote or the damages sought, even if fully recovered, would not be considered material to our consolidated statements of condition and related statements of income, comprehensive income, shareholders’ equity and cash flows. However, many of these matters are in various stages of proceedings and further developments could cause management to revise its assessment of these matters. |
Transactions with Related Parti
Transactions with Related Parties | 12 Months Ended |
Dec. 31, 2018 | |
Transactions with Related Parties | |
Transactions with Related Parties | (18) Transactions with Related Parties In the ordinary course of business, the Subsidiary Banks make loans to our directors and executive officers, including their affiliates, families and companies in which they are principal owners. In the opinion of management, these loans are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and do not involve more than normal risk of collectability or present other unfavorable features. The aggregate amounts receivable from such related parties amounted to approximately $33,042,000 and $27,626,000 at December 31, 2018 and 2017, respectively. |
Financial Instruments with Off-
Financial Instruments with Off-Statement of Condition Risk and Concentrations of Credit Risk | 12 Months Ended |
Dec. 31, 2018 | |
Financial Instruments with Off-Statement of Condition Risk and Concentrations of Credit Risk | |
Financial Instruments with Off-Statement of Condition Risk and Concentrations of Credit Risk | (19) Financial Instruments with Off‑Statement of Condition Risk and Concentrations of Credit Risk In the normal course of business, the Subsidiary Banks are party to financial instruments with off‑statement of condition risk to meet the financing needs of their customers. These financial instruments include commitments to their customers. These financial instruments involve, to varying degrees, elements of credit risk in excess of the amounts recognized in the consolidated statement of condition. The contract amounts of these instruments reflect the extent of involvement the Subsidiary Banks have in particular classes of financial instruments. At December 31, 2018, the following financial amounts of instruments, whose contract amounts represent credit risks, were outstanding: Commitments to extend credit $ 2,935,768,000 Credit card lines 21,114,000 Standby letters of credit 111,229,000 Commercial letters of credit 8,073,000 We enter into a standby letter of credit to guarantee performance of a customer to a third party. These guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved is represented by the contractual amounts of those instruments. Under the standby letters of credit, we are required to make payments to the beneficiary of the letters of credit upon request by the beneficiary so long as all performance criteria have been met. At December 31, 2018, the maximum potential amount of future payments is approximately $111,229,000. At December 31, 2018, the fair value of these guarantees is not significant. Unsecured letters of credit totaled approximately $42,729,000 and $35,409,000 at December 31, 2018 and 2017, respectively. We enter into commercial letters of credit on behalf of our customers which authorize a third party to draw drafts upon us up to a stipulated amount and with specific terms and conditions. A commercial letter of credit is a conditional commitment on our part to provide payment on drafts drawn in accordance with the terms of the commercial letter of credit. The Subsidiary Banks’ exposure to credit loss in the event of nonperformance by the other party to the above financial instruments is represented by the contractual amounts of the instruments. The Subsidiary Banks use the same credit policies in making commitments and conditional obligations as they do for on‑statement of condition instruments. The Subsidiary Banks control the credit risk of these transactions through credit approvals, limits and monitoring procedures. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates normally less than one year or other termination clauses and may require the payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Subsidiary Banks evaluate each customer’s credit‑worthiness on a case‑by‑case basis. The amount of collateral obtained, if deemed necessary by the Subsidiary Banks upon extension of credit, is based on management’s credit evaluation of the customer. Collateral held varies, but may include residential and commercial real estate, bank certificates of deposit, accounts receivable and inventory. The Subsidiary Banks make commercial, real estate and consumer loans to customers principally located in South, Central and Southeast Texas and the State of Oklahoma. Although the loan portfolio is diversified, a substantial portion of its debtors’ ability to honor their contracts is dependent upon the economic conditions in these areas, especially in the real estate and commercial business sectors. |
Capital Requirements
Capital Requirements | 12 Months Ended |
Dec. 31, 2018 | |
Capital Requirements | |
Capital Requirements | (20) Capital Requirements On December 23, 2008, as part of the Troubled Asset Relief Program Capital Purchase Program of the United States Department of the Treasury (“Treasury”), we issued to the Treasury a warrant to purchase 1,326,238 shares of our common stock at a price per share of $24.43 and with a term of ten years (the “Warrant”). On June 12, 2013, the U.S. Treasury sold the Warrant to a third party. On September 19, 2018, we entered into an agreement to repurchase the Warrant from the third party at an aggregate purchase price of $29,005,000, which transaction was consummated in the third quarter of 2018. The repurchase of the outstanding Warrant eliminates any restrictions on certain shareholder distributions or payment of cash dividends in excess of $0.33 per semi-annual period that would have impacted the exercise price of the Warrant while it remained outstanding. Bank regulatory agencies limit the amount of dividends, which the Subsidiary Banks can pay, without obtaining prior approval from such agencies. At December 31, 2018, the Subsidiary Banks could pay dividends of up to $768,900,000 without prior regulatory approval and without adversely affecting their “well‑capitalized” status under regulatory capital rules in effect at December 31, 2018. In addition to legal requirements, regulatory authorities also consider the adequacy of the Subsidiary Banks’ total capital in relation to their deposits and other factors. These capital adequacy considerations also limit amounts available for payment of dividends. We historically have not allowed any Subsidiary Bank to pay dividends in such a manner as to impair its capital adequacy. We and the Subsidiary Banks are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on our consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, we must meet specific capital guidelines that involve quantitative measures of our assets, liabilities, and certain off‑statement of condition items as calculated under regulatory accounting practices. Our capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Current quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the table on the following page) of Total and Tier 1 capital to risk‑weighted assets and of Tier 1 capital to average assets. Management believes, as of December 31, 2018, that we met all capital adequacy requirements to which we are subject. On November 21, 2017, the OCC, the Federal Reserve and the FDIC finalized a proposed rule that extends the current treatment under the regulatory capital rules for certain regulatory capital deductions and risk weights and certain minority interest requirements, as they apply to banking organizations that are not subject to the advanced approaches capital rules. Effective January 1, 2018, the rule also pauses the full transition to the Basel III treatment of mortgage servicing assets, certain deferred tax assets, investments in the capital of unconsolidated financial institutions and minority interests. The agencies are also considering whether to make adjustments to the capital rules in response to CECL (the FASB Standard relating to current expected credit loss) and its potential impact on regulatory capital. On December 7, 2017, the Basel Committee on Banking Supervision unveiled the latest round of its regulatory capital framework, commonly called “Basel IV.” The framework makes changes to the capital framework first introduced as “Basel III” in 2010. The committee targeted 2022-2027 as the timeframe for implementation by regulators in individual countries, including the U.S. federal bank regulatory agencies (after notice and comment). The aforementioned capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio of CET1 capital to risk-weighted assets above the minimum but below the conservation buffer will face constraints on dividends, equity repurchases and compensation based on the amount of the shortfall. As of December 31, 2018, our capital levels exceed all capital adequacy requirements under the Basel III Capital Rules as currently applicable to us. Based on the ratios presented below, capital levels as of December 31, 2018 exceed the minimum levels necessary to be considered “well capitalized.” On May 24, 2018, the EGRRCPA was enacted and, among other things, it includes a simplified capital rule change which effectively exempts banks with assets of less than $10 billion that exceed the “community bank leverage ratio,” from all risk-based capital requirements, including Basel III and its predecessors. The federal banking agencies must establish the “community bank leverage ratio” (a ratio of tangible equity to average consolidated assets) between 8% and 10% before community banks can begin to take advantage of this regulatory relief provision. Some of the Subsidiary Banks, with assets of less than $10 billion, may qualify for this exemption. Additionally, under the EGRRCPA, qualified bank holding companies with assets of up to $3 billion (currently $1 billion) will be eligible for the Federal Reserve’s Small Bank Holding Company Policy Statement, which eases limitations on the issuance of debt by holding companies. On August 28, 2018, the Federal Reserve issued an interim final rule expanding the applicability of its Small Bank Holding Company Policy Statement. While holding companies that meet the conditions of the policy statement are excluded from consolidated capital requirements, their depository institutions continue to be subject to minimum capital requirements. Finally, for banks that continue to be subject to the risk-based capital rules of Basel III (e.g., 150%), certain commercial real estate loans that were formally classified as high volatility commercial real estate 31 (“HVCRE”) will not be subject to heightened risk weights if they meet certain criteria. Also, while acquisition, development, and construction (“ADC”) loans will generally be subject to heightened risk weights, certain exceptions will apply. On September 18, 2018, the federal banking agencies issued a proposed rule modifying the agencies’ capital rules for HVCRE. As of December 31, 2018, the most recent notification from the Federal Deposit Insurance Corporation categorized all the Subsidiary Banks as well‑capitalized under the regulatory framework for prompt corrective action. To be categorized as “well‑capitalized,” we must maintain minimum Total risk‑based, Tier 1 risk based, and Tier 1 leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed our categorization as well‑capitalized. In December 2018, the federal bank regulators issued a final rule that would provide an optional three-year phase-in period for the day-one regulatory capital effects of the adoption of ASU 2016-13 to ASC 326 “Financial Instruments – Credit Losses,” as amended, on January 1, 2020. Our actual capital amounts and ratios for 2018 under current guidelines are presented in the following table: For Capital Adequacy To Be Well-Capitalized Purposes Under Prompt Corrective Actual Phase In Schedule Action Provisions Amount Ratio Amount Ratio Amount Ratio (greater than (greater than (greater than (greater than or equal to) or equal to) or equal to) or equal to) (Dollars in Thousands) As of December 31, 2018: Common Equity Tier 1 (to Risk Weighted Assets): Consolidated $ 1,711,682 17.55 % $ 621,850 6.375 % N/A N/A International Bank of Commerce, Laredo 1,201,462 17.24 444,207 6.375 $ 452,917 % International Bank of Commerce, Oklahoma 188,997 13.95 86,344 6.375 88,037 International Bank of Commerce, Brownsville 177,456 24.73 45,741 6.375 46,638 International Bank of Commerce, Zapata 70,984 30.77 14,707 6.375 14,996 Commerce Bank 89,305 32.95 17,276 6.375 17,615 Total Capital (to Risk Weighted Assets): Consolidated $ 1,925,905 19.74 % $ 963,258 9.875 % N/A N/A International Bank of Commerce, Laredo 1,248,107 17.91 688,086 9.875 $ 696,796 % International Bank of Commerce, Oklahoma 198,293 14.64 133,749 9.875 135,442 International Bank of Commerce, Brownsville 183,554 25.58 70,854 9.875 71,750 International Bank of Commerce, Zapata 73,726 31.96 22,782 9.875 23,070 Commerce Bank 90,894 33.54 26,761 9.875 27,100 Tier 1 Capital (to Risk Weighted Assets): Consolidated $ 1,859,536 19.06 % $ 768,168 7.875 % N/A N/A International Bank of Commerce, Laredo 1,201,462 17.24 548,727 7.875 $ 557,437 % International Bank of Commerce, Oklahoma 188,997 13.95 106,660 7.875 108,354 International Bank of Commerce, Brownsville 177,456 24.73 56,503 7.875 57,400 International Bank of Commerce, Zapata 70,984 30.77 18,168 7.875 18,456 Commerce Bank 89,305 32.95 21,341 7.875 21,680 Tier 1 Capital (to Average Assets): Consolidated $ 1,859,536 15.87 % $ 468,593 % $ N/A N/A International Bank of Commerce, Laredo 1,201,462 14.45 332,507 415,634 % International Bank of Commerce, Oklahoma 188,997 12.53 60,344 75,430 International Bank of Commerce, Brownsville 177,456 17.25 41,144 51,430 International Bank of Commerce, Zapata 70,984 16.22 17,507 21,884 Commerce Bank 89,305 15.53 23,000 28,750 Our actual capital amounts and ratios for 2017 are also presented in the following table: To Be Well-Capitalized For Capital Adequacy Under Prompt Corrective Actual Purposes Action Provisions Amount Ratio Amount Ratio Amount Ratio (greater than (greater than (greater than (greater than or equal to) or equal to) or equal to) or equal to) (Dollars in Thousands) As of December 31, 2017: Common Equity Tier 1 (to Risk Weighted Assets): Consolidated $ 1,584,665 % $ 532,579 % N/A N/A International Bank of Commerce, Laredo 1,119,173 376,245 $ 425,320 % International Bank of Commerce, Oklahoma 169,279 72,586 82,054 International Bank of Commerce, Brownsville 165,034 36,583 41,355 International Bank of Commerce, Zapata 66,406 12,487 14,116 Commerce Bank 79,330 13,733 15,524 Total Capital (to Risk Weighted Assets): Consolidated $ 1,807,107 % $ 856,757 % N/A N/A % International Bank of Commerce, Laredo 1,173,068 605,263 $ 654,339 International Bank of Commerce, Oklahoma 178,057 116,769 126,237 International Bank of Commerce, Brownsville 170,613 58,851 63,623 International Bank of Commerce, Zapata 68,718 20,088 21,717 Commerce Bank 81,278 22,092 23,884 Tier 1 Capital (to Risk Weighted Assets): % Consolidated $ 1,734,595 % $ 671,512 % N/A N/A International Bank of Commerce, Laredo 1,119,173 474,395 $ 523,471 International Bank of Commerce, Oklahoma 169,279 91,521 100,989 International Bank of Commerce, Brownsville 165,034 46,127 50,899 International Bank of Commerce, Zapata 66,406 15,745 17,374 Commerce Bank 79,330 17,316 19,107 % Tier 1 Capital (to Average Assets): Consolidated $ 1,734,595 % $ 474,675 % $ N/A N/A International Bank of Commerce, Laredo 1,119,173 333,166 416,458 International Bank of Commerce, Oklahoma 169,279 59,854 74,818 International Bank of Commerce, Brownsville 165,034 38,440 48,050 International Bank of Commerce, Zapata 66,406 18,701 23,376 Commerce Bank 79,330 21,789 27,236 |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value | |
Fair Value | (21) Fair Value ASC Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”) defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. ASC 820 applies to all financial instruments that are being measured and reported on a fair value basis. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; it also establishes a fair value hierarchy that prioritizes the inputs used in valuation methodologies into the following three levels: · Level 1 Inputs—Unadjusted quoted prices in active markets for identical assets or liabilities. · Level 2 Inputs—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. · Level 3 Inputs—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or other valuation techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy is set forth below. The following table represents financial instruments reported on the consolidated statements of condition at their fair value as of December 31, 2018 by level within the fair value measurement hierarchy. Fair Value Measurements at Reporting Date Using (in Thousands) Quoted Prices in Active Significant Assets/Liabilities Markets for Other Significant Measured at Identical Observable Unobservable Fair Value Assets Inputs Inputs December 31, 2018 (Level 1) (Level 2) (Level 3) Measured on a recurring basis: Assets: Available for sale debt securities Residential mortgage-backed securities $ 3,223,010 $ — $ 3,223,010 $ — States and political subdivisions 188,340 — 188,340 — Equity securities with readily determinable fair values 5,937 5,937 — — $ 3,417,287 $ 5,937 $ 3,411,350 $ — The following table represents financial instruments reported on the consolidated balance sheets at their fair value as of December 31, 2017 by level within the fair value measurement hierarchy. Fair Value Measurements at Reporting Date Using (in Thousands) Quoted Prices in Active Significant Assets/Liabilities Markets for Other Significant Measured at Identical Observable Unobservable Fair Value Assets Inputs Inputs December 31, 2017 (Level 1) (Level 2) (Level 3) Measured on a recurring basis: Assets: Available for sale securities Residential mortgage - backed securities $ 3,891,233 $ — $ 3,891,233 $ — States and political subdivisions 232,951 — 232,951 — Equity securities with readily determinable fair values 27,886 27,886 — — $ 4,152,070 $ 27,886 $ 4,124,184 $ — For the years ended December 31, 2018 and December 31, 2017, debt investment securities available‑for‑sale are classified within Level 2 of the valuation hierarchy. Equity securities with readily determinable fair values are classified within Level 1. For debt securities classified as Level 2 in the fair value hierarchy, we obtain fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things. Certain financial instruments are measured at fair value on a nonrecurring basis. They are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). The following table represents financial instruments measured at fair value on a non‑recurring basis as of and for the period ended December 31, 2018 by level within the fair value measurement hierarchy: Fair Value Measurements at Reporting Date Using (in thousands) Quoted Assets/Liabilities Prices in Measured at Active Significant Fair Value Markets for Other Significant Net Provision Year ended Identical Observable Unobservable (Credit) December 31, Assets Inputs Inputs During 2018 (Level 1) (Level 2) (Level 3) Period Measured on a non-recurring basis: Assets: Impaired loans $ 1,563 $ — $ — $ 1,563 $ 356 Other real estate owned 38,871 — — 38,871 3,071 The following table represents financial instruments measured at fair value on a non‑recurring basis as of and for the year ended December 31, 2017 by level within the fair value measurement hierarchy: Fair Value Measurements at Reporting Date Using (in thousands) Quoted Assets/Liabilities Prices in Measured at Active Significant Fair Value Markets Other Significant Net (Credit) Year ended for Identical Observable Unobservable Provision December 31, Assets Inputs Inputs During 2017 (Level 1) (Level 2) (Level 3) Period Measured on a non-recurring basis: Assets: Impaired loans $ 11,210 $ — $ — $ 11,210 $ 2,138 Other real estate owned 2,000 — — 2,000 710 Our assets measured at fair value on a non-recurring basis are limited to impaired loans and other real estate owned. Impaired loans are classified within Level 3 of the valuation hierarchy. The fair value of impaired loans is derived in accordance with FASB ASC 310, “Receivables”. Impaired loans are primarily comprised of collateral-dependent commercial loans. Understanding that as the primary sources of loan repayments decline, the secondary repayment source comes into play and correctly evaluating the fair value of that secondary source, the collateral, becomes even more important. Re-measurement of the impaired loan to fair value is done through a specific valuation allowance included in the allowance for probable loan losses. The fair value of impaired loans is based on the fair value of the collateral, as determined through either an appraisal or evaluation process. The basis for our appraisal and appraisal review process is based on regulatory guidelines and strives to comply with all regulatory appraisal laws, regulations and the Uniform Standards of Professional Appraisal Practice. All appraisals and evaluations are “as is” (the property’s highest and best use) valuations based on the current conditions of the property/project at that point in time. The determination of the fair value of the collateral is based on the net realizable value, which is the appraised value less any closing costs, when applicable. As of December 31, 2018, we had approximately $14,306,000 of impaired commercial collateral dependent loans, of which approximately $10,911,000 had an appraisal performed within the immediately preceding twelve months and of which approximately $0 had an evaluation performed within the immediately preceding twelve months. As of December 31, 2017, we had approximately $53,267,000 of impaired commercial collateral dependent loans, of which approximately $18,585,000 had an appraisal performed within the immediately preceding twelve months and of which approximately $0 had an evaluation performed within the immediately preceding twelve months. The determination to either seek an appraisal or to perform an evaluation begins in weekly credit quality meetings, where the committee analyzes the existing collateral values of the impaired loans and where obsolete appraisals are identified. In order to determine whether we would obtain a new appraisal or perform an internal evaluation to determine the fair value of the collateral, the credit committee reviews the existing appraisal to determine if the collateral value is reasonable in view of the current use of the collateral and the economic environment related to the collateral. If the analysis of the existing appraisal does not find that the collateral value is reasonable under the current circumstances, we would obtain a new appraisal on the collateral or perform an internal evaluation of the collateral. The ultimate decision to get a new appraisal rests with the independent credit administration group. A new appraisal is not required if an internal evaluation, as performed by in-house experts, is able to appropriately update the original appraisal assumptions to reflect current market conditions and provide an estimate of the collateral’s market value for impairment analysis. The internal evaluations must be in writing and contain sufficient information detailing the analysis, assumptions and conclusions and they must support performing an evaluation in lieu of ordering a new appraisal. Other real estate owned is comprised of real estate acquired by foreclosure and deeds in lieu of foreclosure. Other real estate owned is carried at the lower of the recorded investment in the property or its fair value less estimated costs to sell such property (as determined by independent appraisal) within Level 3 of the fair value hierarchy. Prior to foreclosure, the value of the underlying loan is written down to the fair value of the real estate to be acquired by a charge to the allowance for probable loan losses, if necessary. The fair value is reviewed periodically and subsequent write downs are made accordingly through a charge to operations. Other real estate owned is included in other assets on the consolidated financial statements. For the twelve months ended December 31, 2018, December 31, 2017 and December 31, 2016, respectively we recorded approximately $170,000, $30,000 and $381,000 in charges to the allowance for probable loan losses in connection with loans transferred to other real estate owned. For the twelve months ended December 31, 2018, December 31, 2017 and December 31, 2016, respectively, we recorded approximately $3,071,000, $710,000 and $2,351,000 in adjustments to fair value in connection with other real estate owned. The fair value estimates, methods, and assumptions for our financial instruments at December 31, 2018 and December 31, 2017 are outlined below. Cash and Cash Equivalents For these short‑term instruments, the carrying amount is a reasonable estimate of fair value. Investment securities held‑to‑maturity The carrying amounts of investments held‑to‑maturity approximate fair value. Investment Securities For debt investment securities, which include U.S. Treasury securities, obligations of other U.S. government agencies, obligations of states and political subdivisions and mortgage pass through and related securities, fair values are from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things. See disclosures of fair value of investment securities in Note 2. Loans Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type such as commercial, real estate and consumer loans as outlined by regulatory reporting guidelines. Each category is segmented into fixed and variable interest rate terms and by performing and non‑performing categories. For variable rate performing loans, the carrying amount approximates the fair value. For fixed rate performing loans, except residential mortgage loans, the fair value is calculated by discounting scheduled cash flows through the estimated maturity using estimated market discount rates that reflect the credit and interest rate risk inherent in the loan. For performing residential mortgage loans, fair value is estimated by discounting contractual cash flows adjusted for prepayment estimates using discount rates based on secondary market sources or the primary origination market. Fixed rate performing loans are within Level 3 of the fair value hierarchy. At December 31, 2018 and December 31, 2017, the carrying amount of fixed rate performing loans was $1,515,437,000 and $1,505,531,000, respectively, and the estimated fair value was $1,469,231,000 and $1,454,434,000, respectively. Accrued Interest The carrying amounts of accrued interest approximate fair value. Deposits The fair value of deposits with no stated maturity, such as non‑interest bearing demand deposit accounts, savings accounts and interest bearing demand deposit accounts, was equal to the amount payable on demand as of December 31, 2018 and December 31, 2017. The fair value of time deposits is based on the discounted value of contractual cash flows. The discount rate is based on currently offered rates. Time deposits are within Level 3 of the fair value hierarchy. At December 31, 2018 and December 31, 2017, the carrying amount of time deposits was $1,973,468,000 and $2,056,506,000, respectively, and the estimated fair value was $1,976,156,000 and $2,058,621,000, respectively. Securities Sold Under Repurchase Agreements Securities sold under repurchase agreements include both short and long‑term maturities. Due to the contractual terms of the short‑term instruments, the carrying amounts approximated fair value at December 31, 2018 and December 31, 2017. The fair value of the long‑term instruments is based on established market spread using option adjusted spread methodology. Long‑term repurchase agreements are within Level 3 of the fair value hierarchy. The only remaining long-term repurchase agreement outstanding matured in the first quarter of 2018 and was not renewed. At December 31, 2017 the carrying amount of long‑term repurchase agreements was $100,000,000 and the estimated fair value was $99,504,000. Junior Subordinated Deferrable Interest Debentures We currently have floating rate junior subordinated deferrable interest debentures outstanding. Due to the contractual terms of the floating rate junior subordinated deferrable interest debentures, the carrying amounts approximated fair value at December 31, 2018 and December 31, 2017. Other Borrowed Funds We currently have short and long‑term borrowings issued from the Federal Home Loan Bank (“FHLB”). Due to the contractual terms of the short‑term borrowings, the carrying amounts approximated fair value at December 31, 2018 and December 31, 2017. The long-term borrowings outstanding at December 31, 2018 and December 31, 2017 are fixed-rate borrowings and the fair value is based on established market spreads for similar types of borrowings. The fixed-rate long-term borrowings are included in Level 2 of the fair value hierarchy. At December 31, 2018, and December 31, 2017 the carrying amount of the fixed-rate long-term FHLB borrowings was $436,690,000 and $250,000,000, respectively and the estimated fair value was $436,238,000 and $249,728,000 respectively. Commitments to Extend Credit and Letters of Credit Commitments to extend credit and fund letters of credit are principally at current interest rates and therefore the carrying amount approximates fair value. Limitations Fair value estimates are made at a point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time of our entire holdings of a particular financial instrument. Because no market exists for a significant portion of our financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing on‑and off‑statement of condition financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Other significant assets and liabilities that are not considered financial assets or liabilities include the bank premises and equipment and core deposit value. In addition, the tax ramifications related to the effect of fair value estimates have not been considered in the above estimates. |
International Bancshares Corpor
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition | 12 Months Ended |
Dec. 31, 2018 | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition | (22) International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition (Parent Company Only) December 31, 2018 and 2017 (Dollars in Thousands) 2018 2017 ASSETS Cash $ 19,065 $ 18,398 Other investments 105,377 92,620 Investment in subsidiaries 1,987,293 1,878,521 Other assets — 23,120 Total assets $ 2,111,735 $ 2,012,659 LIABILITIES AND SHAREHOLDERS’ EQUITY Liabilities: Junior subordinated deferrable interest debentures $ 160,416 $ 160,416 Due to IBC Trading 21 21 Other liabilities 11,716 13,242 Total liabilities 172,153 173,679 Shareholders’ equity: Common shares 96,104 96,019 Surplus 145,283 171,816 Retained earnings 2,064,134 1,891,805 Accumulated other comprehensive (loss) income (54,634) (28,397) 2,250,887 2,131,243 Less cost of shares in treasury (311,305) (292,263) Total shareholders’ equity 1,939,582 1,838,980 Total liabilities and shareholders’ equity $ 2,111,735 $ 2,012,659 |
International Bancshares Corp_2
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income | 12 Months Ended |
Dec. 31, 2018 | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income | (23) International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income (Parent Company Only) Years ended December 31, 2018, 2017 and 2016 (Dollars in Thousands) 2018 2017 2016 Income: Dividends from subsidiaries $ 105,000 $ 64,600 $ 84,432 Interest income on notes receivable — — 2 Interest income on other investments 8,208 8,100 8,958 Other 1,988 26 255 Total income 115,196 72,726 93,647 Expenses: Interest expense (Debentures) 6,989 5,392 4,600 Other 2,930 5,648 3,637 Total expenses 9,919 11,040 8,237 Income before federal income taxes and equity in undistributed net income of subsidiaries 105,277 61,686 85,410 Income tax expense 481 (2,076) 311 Income before equity in undistributed net income of subsidiaries 104,796 63,762 85,099 Equity in undistributed net income of subsidiaries 111,135 93,674 48,833 Net income $ 215,931 $ 157,436 $ 133,932 |
International Bancshares Corp_3
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows | 12 Months Ended |
Dec. 31, 2018 | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows | (24) International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows (Parent Company Only) Years ended December 31, 2018, 2017 and 2016 (Dollars in Thousands) 2018 2017 2016 Operating activities: Net income $ 215,931 $ 157,436 $ 133,932 Adjustments to reconcile net income to net cash provided by operating activities: Investment securities transactions, net — (23) — Unrealized loss on equity securities with readily determinable fair values 330 — — Impairment charges on available for sale securities — — 112 Stock compensation expense 1,035 903 1,082 (Decrease) increase in other liabilities (1,479) (3,453) 3,901 Equity in undistributed net income of subsidiaries (111,135) (93,674) (48,833) Net cash provided by operating activities 104,682 61,189 90,194 Investing activities: Principal collected on mortgage-backed securities — 6,328 1,105 Net decrease in notes receivable — — 99 Increase in other assets and other investments (7,891) (25,348) (27,834) Net cash used in investing activities (7,891) (19,020) (26,630) Financing activities: Redemption of long-term debt — — (1,000) Proceeds from stock transactions 1,522 1,455 549 Payments of cash dividends - common (49,599) (43,594) (39,569) Repurchase of outstanding common stock warrant (29,005) — — Purchase of treasury stock (19,042) (187) (7,966) Net cash used in financing activities (96,124) (42,326) (47,986) Increase (decrease) in cash 667 (157) 15,578 Cash at beginning of year 18,398 18,555 2,977 Cash at end of year $ 19,065 $ 18,398 $ 18,555 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of Significant Accounting Policies | |
Consolidation and Basis of Presentation | Consolidation and Basis of Presentation Our consolidated financial statements include the accounts of the International Bancshares Corporation, its wholly-owned Subsidiary Banks and its wholly-owned non-bank subsidiaries, IBC Subsidiary Corporation, IBC Trading Company, Premier Tierra Holdings, Inc., IBC Charitable and Community Development Corporation, and IBC Capital Corporation. All significant inter-company balances and transactions have been eliminated in consolidation. We, through our Subsidiary Banks, are primarily engaged in the business of banking, including the acceptance of checking and savings deposits and the making of commercial, real estate, personal, home improvement, automobile and other installment and term loans. Our primary markets are north, south, central, and southeast Texas and the state of Oklahoma. Each of our Subsidiary Banks is very active in facilitating international trade along the United States border with Mexico and elsewhere. Although our loan portfolio is diversified, the ability of our debtors to honor their contracts is primarily dependent upon the economic conditions in our trade area. In addition, the investment portfolio is directly impacted by fluctuations in market interest rates. We are subject to the regulations of certain federal agencies as well as the Texas Department of Banking and the Oklahoma Department of Banking and undergo periodic examinations by those regulatory authorities. Such agencies may require certain standards or impose certain limitations based on their judgments or changes in law and regulations. We own one insurance‑related subsidiary, IBC Insurance Agency, Inc., a wholly owned subsidiary of our Subsidiary Bank, International Bank of Commerce, Laredo. The insurance‑related subsidiary does not conduct underwriting activities. The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the dates of the statement of condition and income and expenses for the periods. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant changes in the near‑term relate to the determination of the allowance for probable loan losses. |
Subsequent Events | Subsequent Events We have evaluated all events or transactions that occurred through the date we issued these financial statements. During this period, we did not have any material recognizable or non‑recognizable subsequent events. |
Investment Securities | Investment Securities We classify debt securities into one of these categories: held‑to‑maturity, available‑for‑sale, or trading. Such classifications are reassessed for appropriate classification at each reporting date. Securities that are intended and expected to be held until maturity are classified as “held‑to‑maturity” and are carried at amortized cost for financial statement reporting. Securities that are not positively expected to be held until maturity, but are intended to be held for an indefinite period of time are classified as “available‑for‑sale” or “trading” and are carried at their fair value. Unrealized holding gains and losses are included in net income for those securities classified as “trading”, while unrealized holding gains and losses related to those securities classified as “available‑for‑sale” are excluded from net income and reported net of tax as other comprehensive income and in shareholders’ equity as accumulated other comprehensive income (loss) until realized. We did not maintain any trading securities during the three-year period ended December 31, 2018. Mortgage‑backed securities held at December 31, 2018 and 2017 represent participating interests in pools of long‑term first mortgage loans originated and serviced by the issuers of the securities. Mortgage‑backed securities are either issued or guaranteed by the U.S. government or its agencies including the Federal Home Loan Mortgage Corporation (“Freddie Mac”), the Federal National Mortgage Association (“Fannie Mae”), the Government National Mortgage Association (“Ginnie Mae”) or other non‑government entities. Investments in residential mortgage‑backed securities issued by Ginnie Mae are fully guaranteed by the U. S. government. Investments in residential mortgage‑backed securities issued by Freddie Mac and Fannie Mae are not fully guaranteed by the U.S. government; however, we believe that the quality of the bonds is similar to other AAA rated bonds with limited credit risk, particularly given the placement of Fannie Mae and Freddie Mac into conservatorship by the federal government in 2008 and because securities issued by others that are collateralized by residential mortgage‑backed securities issued by Fannie Mae or Freddie Mac are rated consistently as AAA rated securities. Market interest rate fluctuations can affect the prepayment speed of principal and the yield on the security. Premiums and discounts are amortized using the level yield or “interest method” over the terms of the securities. Declines in the fair value of held‑to‑maturity and available‑for sale‑securities below their cost that are deemed to be other than temporary are reflected in earnings as realized losses. In determining whether other‑than‑temporary impairment exists, management considers many factors, including (i) the length of time and the extent to which the fair value has been less than cost, (ii) the financial condition and near‑term prospects of the issuer, and (iii) our intent to hold and our determination of whether we will more likely than not be required to sell the security prior to a recovery in fair value. If we determine that (i) we intend to sell the security or (ii) it is more likely than not that we will be required to sell the security before it’s anticipated recovery, the other‑than‑temporary impairment that is recognized in earnings is equal to the difference between the fair value of the security and our amortized cost of the security. If we determine that we (i) do not intend to sell the security and (ii) we will not be more likely than not required to sell the security before it’s anticipated recovery, the other‑than‑temporary impairment is segregated into its two components (i) the amount of impairment related to credit loss and (ii) the amount of impairment related to other factors. The difference between the present value of the cash flows expected to be collected and the amortized cost is the credit loss recognized through earnings and an adjustment to the cost basis of the security. The amount of impairment related to other factors is included in other comprehensive income (loss). Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. Equity Securities Prior to January 1, 2018, equity securities with readily determinable fair values were included in available-for-sale securities, with the unrealized gain or loss recorded as a component of other comprehensive income (loss). Pursuant to the adoption of ASU 2016-02, equity securities with readily determinable fair values are a separate component of our balance sheet, with unrealized gains and losses recognized in net income. Equity securities with readily determinable fair values at December 31, 2018 and December 31, 2017 consist primarily of Community Reinvestment Act funds. |
Provision and Allowance for Probable Loan Losses | Provision and Allowance for Probable Loan Losses The allowance for probable loan losses is maintained at a level considered adequate by management to provide for probable loan losses. The allowance is increased by provisions charged to operating expense and reduced by net charge‑offs. The provision for probable loan losses is the amount, which, in the judgment of management, is necessary to establish the allowance for probable loan losses at a level that is adequate to absorb known and inherent risks in the loan portfolio. Management believes that the allowance for probable loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review our Subsidiary Banks’ allowances for probable loan losses. Such agencies may require our Subsidiary Banks to make additions or reductions to their GAAP allowances based on their judgments of information available to them at the time of their examination. The Subsidiary Banks charge-off that portion of any loan which management considers to represent a loss as well as that portion of any other loan which is classified as a “loss” by bank examiners. Commercial, financial and agricultural or real estate loans are generally considered by management to represent a loss, in whole or part, (i) when an exposure beyond any collateral coverage is apparent, (ii) when no further collection of the portion of the loan so exposed is anticipated based on actual results, (iii) when the credit enhancements, if any, are not adequate, and (iv) when the borrower’s financial condition would indicate so. Generally, unsecured consumer loans are charged-off when 90 days past due. |
Loans | Loans Loans are reported at the principal balance outstanding, net of unearned discounts. Interest income on loans is reported on an accrual basis. Loan fees and costs associated with originating the loans are accreted or amortized over the life of the loan using the interest method. We originate mortgage loans that may subsequently be sold to an unaffiliated third party. The loans are not securitized and if sold, are sold without recourse. Loans held for sale are carried at cost and the principal amount outstanding is not significant to the consolidated financial statements. |
Impaired Loans | Impaired Loans Impaired loans are those loans where it is probable that all amounts due according to contractual terms of the loan agreement will not be collected. Impaired loans are measured based on (1) the present value of expected future cash flows discounted at the loan’s effective interest rate; (2) the loan’s observable market price; or (3) the fair value of the collateral if the loan is collateral dependent. Substantially all our impaired loans are measured at the fair value of the collateral. In limited cases, we may use other methods to determine the level of impairment of a loan if such loan is not collateral dependent. |
Troubled Debt Restructured Loans | Troubled Debt Restructured Loans Troubled debt restructured loans (“TDR”) are those loans where, for reasons related to a borrower’s difficulty to repay a loan, we grant a concession to the borrower that we would not normally consider in the normal course of business. The original terms of the loan are modified or restructured. The terms that may be modified include a reduction in the original stated interest rate, an extension of the original maturity of the loan, a renewal of the loan at an interest rate below current market rates, a reduction in the principal amount of debt outstanding, a reduction in accrued interest or deferral of interest payments. A loan classified as a TDR is classified as an impaired loan and included in the impaired loan totals. A TDR loan may be returned to accrual status when the loan is brought current, has performed in accordance with the restructured terms for a reasonable period of time, is at the current market rate, and the ultimate collectability of the outstanding principal and interest is no longer questionable, however, although those loans may be placed back on accrual status, they will continue to be classified as impaired. Consistent with regulatory guidance, a TDR loan that is subsequently modified, but has shown sustained performance and classification as a TDR, will be removed from TDR status provided that the modified terms were market-based at the time of modification. |
Non-Accrual Loans | Non‑Accrual Loans The non‑accrual loan policy of our Subsidiary Banks is to discontinue the accrual of interest on loans when management determines that it is probable that future interest accruals will be un‑collectible. As it relates to consumer loans, management charges-off those loans when the loan is contractually 90 days past due. Under special circumstances, a consumer or non‑consumer loan may be more than 90 days delinquent as to interest or principal and not be placed on non‑accrual status. This situation generally results when a Subsidiary Bank has a borrower who is experiencing financial difficulties, but not to the extent that requires a restructuring of indebtedness. The majority of this category is composed of loans that are considered to be adequately secured and/or for which there are expected future payments. When a loan is placed on non‑accrual status, any interest accrued, not paid is reversed and charged to operations against interest income. As it relates to non‑consumer loans that are not 90 days past due, management will evaluate each of these loans to determine if placing the loan on non‑accrual status is warranted. Interest income on non‑accrual loans is recognized only to the extent payments are received or when, in management’s opinion, the debtor’s financial condition warrants reestablishment of interest accruals. |
Other Real Estate Owned and Reposessed Assets | Other Real Estate Owned and Reposessed Assets Other real estate owned is comprised of real estate acquired by foreclosure and deeds in lieu of foreclosure. Other real estate is carried at the lower of the recorded investment in the property or its fair value less estimated costs to sell such property (as determined by independent appraisal). Prior to foreclosure, the value of the underlying loan is written down to the fair value of the real estate to be acquired by a charge to the allowance for probable loan losses, if necessary. Any subsequent write‑downs are charged against other non‑interest expense through a valuation allowance. Other real estate owned totaled approximately $57,344,000 and $30,519,000 at December 31, 2018 and 2017, respectively. Other real estate owned is included in other assets. Reposessed assets consist primarily of non-real estate assets acquired by foreclosure. Prior to foreclosure, the value of the underlying loan is written down to the fair value of the asset to be repossessed by a charge to the allowance for probable loan losses, if necessary. Reposessed assets are included in other assets on the consolidated financial statements and totaled approximately $6,454,000 and $303,000 at December 31, 2018 and 2017, respectively. |
Bank Premises and Equipment | Bank Premises and Equipment Bank premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed on straight‑line and accelerated methods over the estimated useful lives of the assets. Repairs and maintenance are charged to operations as incurred and expenditures for renewals and betterments are capitalized. |
Other Investments | Other Investments Other investments include equity investments in non‑financial companies, as well as equity securities with no readily determinable fair market value. Equity investments are accounted for using the equity method of accounting. Equity securities with no readily determinable fair value are accounted for using the cost method. |
Cash Surrender Value of Bank Owned Life Insurance | Cash Surrender Value of Bank Owned Life Insurance Cash surrender value of bank owned life insurance includes investments in cash value insurance policies to assist with financing employee compensation and benefit programs. The cash value of the underlying policies accumulates on a tax-free basis and is received through death proceeds, which are also tax-free. The earnings on the policies are derived from the investment portfolio returns of the individual insurance carriers for general account policies and on the returns on investments segregated in our name for separate account policies. |
Revenue recognition | Revenue Recognition On January 1, 2018, we adopted the provisions of ASU 2014-09 to ASC 606, “Revenue from Contracts with Customers.” Since our revenue is primarily comprised of net interest income on financial assets and liabilities, which were excluded from the scope of the update, the remaining non-interest revenue streams were identified and then analyzed under the provisions of the update, to: (i) indentify the contract, (ii) identify the performance obligation, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations, and (v) recognize revenue when the performance obligation was satisfied. Our non-interest revenue contracts with customers are primarily short term and our performance obligation is satisfied at a single point in time, typically within a single period. No changes to our existing methods for recognizing revenue were made as a result of the update. |
Income Taxes | Income Taxes Deferred income tax assets and liabilities are determined using the asset and liability method. Under this method, the net deferred tax asset or liability is determined based on the tax effects of the differences between the book and tax basis of the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws. We file a consolidated federal income tax return with our subsidiaries. Recognition of deferred tax assets is based on management’s assessment that the benefit related to certain temporary differences, tax operating loss carry forwards, and tax credits are more likely than not to be realized. A valuation allowance is recorded for the amount of the deferred tax items for which it is more likely than not that the tax benefits will not be realized. We evaluate uncertain tax positions at the end of each reporting period. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefit recognized in the financial statements from any such a position is measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. As of December 31, 2018 and 2017, respectively, after evaluating all uncertain tax positions, we have recorded no liability for unrecognized tax benefits at the end of the reporting period. We would recognize any interest accrued on unrecognized tax benefits as other interest expense and penalties as other non‑interest expense. During the years ended December 31, 2018, 2017 and 2016, we recognized no interest expense or penalties related to uncertain tax positions. We file consolidated tax returns in the U.S. Federal jurisdiction and various state jurisdictions. We are no longer subject to U.S. federal or state income tax examinations by tax authorities for years before 2015. |
Stock Options | Stock Options Compensation expense for stock awards is based on the market price of the stock on the measurement date, which is generally the date of grant, and is recognized ratably over the service period of the award. The fair value of stock options granted was estimated using the Black‑Sholes‑Merton option‑pricing model. This model was developed for use in estimating the fair value of publicly traded options that have no vesting restrictions and are fully transferable. Additionally, the model requires the input of highly subjective assumptions. Because our employee stock options have characteristics significantly different from those of publicly traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the Black‑Scholes‑Merton option‑pricing model does not necessarily provide a reliable single measure of the fair value of our stock options. |
Net Income Per Share | Net Income Per Share Basic Earnings Per Share (“EPS”) is calculated by dividing net income by the weighted average number of common shares outstanding. The computation of diluted EPS assumes the issuance of common shares for all dilutive potential common shares outstanding during the reporting period. The dilutive effect of stock options is considered in earnings per share calculations, if dilutive, using the treasury stock method. |
Goodwill and Identified Intangible Assets | Goodwill and Identified Intangible Assets Goodwill represents the excess of costs over fair value of assets of businesses acquired. Goodwill is tested for impairment at least annually or on an interim basis if an event triggering impairment may have occurred. As of October 1, 2018, after completing goodwill testing, we have determined that no goodwill impairment exists. Identified intangible assets are acquired assets that lack physical substance but can be distinguished from goodwill because of contractual or other legal rights or because the asset is capable of being sold or exchanged either on its own or in combination with a related contract, asset, or liability. Our identified intangible assets relate to core deposits and contract rights. As of December 31, 2018, we have determined that no impairment of identified intangibles exists. Identified intangible assets with definite useful lives are amortized on an accelerated basis over their estimated life. See Note 6—Goodwill and Other Intangible Assets. |
Impairment of Long-Lived Assets | Impairment of Long‑Lived Assets Long‑lived assets, such as property, plant and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying value of the asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying value of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying value of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the statement of condition and reported at the lower of the carrying value or fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the statement of condition. |
Consolidated Statements of Cash Flows | Consolidated Statements of Cash Flows For purposes of the consolidated statements of cash flows, we consider all short‑term investments with a maturity at date of purchase of three months or less to be cash equivalents. Also, we report transactions related to deposits and loans to customers on a net basis. |
Accounting for Transfers and Servicing of Financial Assets | Accounting for Transfers and Servicing of Financial Assets We account for transfers and servicing of financial assets and extinguishments of liabilities based on the application of a financial‑components approach that focuses on control. After a transfer of financial assets, we recognize the financial and servicing assets we control and liabilities we have incurred, derecognize financial assets when control has been surrendered and derecognize liabilities when extinguished. We have retained mortgage servicing rights in connection with the sale of mortgage loans. Because we may not initially identify loans as originated for resale, all loans are initially treated as held for investment. The value of the mortgage servicing rights are reviewed periodically for impairment and are amortized in proportion to, and over the period of estimated net servicing income or net servicing losses. The value of the mortgage servicing rights is not significant to the consolidated statements of condition. |
Segments of an Enterprise and Related Information | Segments of an Enterprise and Related Information We operate as one segment. The operating information used by our chief executive officer for purposes of assessing performance and making operating decisions is the consolidated financial statements presented in this report. We have five active operating subsidiaries, namely, the Subsidiary Banks. We apply the provisions of ASC Topic 280, “Segment Reporting,” in determining our reportable segments and related disclosures. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available for sale. |
Advertising | Advertising Advertising costs are expensed as incurred. |
Reclassifications | Reclassifications Certain amounts in the prior year’s presentations have been reclassified to conform to the current presentation. These reclassifications had no effect on previously reported net income or shareholders’ equity. |
New Accounting Standards | New Accounting Standards In May 2014, the FASB issued Accounting Standards Update No. 2014-09 to ASC 606, “Revenue from Contracts with Customers.” The update sets a common standard that defines revenue and the principles for recognizing revenue. The update outlines when an entity should recognize revenue, among other matters. At its core, the update states that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The update also outlines the steps that entities should take to determine and record the current revenue number including: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract(s), (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract(s), and (v) recognize revenue when (or as) the entity satisfies the identified performance obligations in the contract(s). The update was originally effective for annual periods beginning after December 31, 2016 and the interim periods within that reporting period. In August 2015, the FASB issued Accounting Standards Update No. 2015-14 which deferred the effective date of ASU 2014-09 by one year to annual and interim periods beginning after December 15, 2017. On January 1, 2018, we adopted the provisions of ASU 2014-09 to ASC 606. Our revenue is primarily comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASC 606. We have evaluated the impact of the accounting standards update on certain other non-interest revenue streams that the provisions of the update apply to and has determined that the adoption of the new provisions to ASC 606 did not have a significant impact to our consolidated financial statements or operations. In January 2016, the FASB issued Accounting Standards Update No. 2016-01 to ASC 825-10, “Financial Instruments – Overall.” The update amends existing standards regarding certain aspects of recognition and measurement of financial assets and financial liabilities. The amendments in the update establish the following guidance: (i) requires equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income, (ii) simplifies the impairment assessment of equity securities without readily determinable fair values by requiring a qualitative assessment, (iii) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities, (iv) eliminates the requirement for public business entities to disclose the methods and significant assumptions used to estimate fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (v) requires public business entities to use the exit price notion when measuring fair value for disclosure purposes, (vi) requires an entity to present separately, in other comprehensive income, the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option, (vii) requires separate presentation of financial assets and liabilities by measurement category and form of financial assets on the balance sheet or in the accompanying notes to the financial statements, and (viii) clarifies that an entity should evaluate the need to a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The update is effective for interim and annual periods beginning after December 15, 2017. On January 1, 2018, we adopted the provisions of ASU 2016-01 The main effect resulting from the adoption of the new standards is that beginning on January 1, 2018, equity securities with readily determinable fair values are now reported in a single line item on the face of our consolidated statement of condition under the caption, “Equity securities with readily determinable fair values.” Additionally, the changes in fair value of the equity securities is now recognized in net income and is included in other non-interest expense on the face of our consolidated income statement. Prior to January 1, 2018, the equity securities were classified as available-for-sale and stated at fair value with unrealized gains and losses included in accumulated comprehensive income, net of tax and had a net unrealized loss of $189,000. Other equity securities without readily determinable fair values are recorded at cost less any impairment, if any, and included in other investments in our consolidated financial statements. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 to ASC 820, “Leases.” The update amends existing standards for accounting for leases by lessees, with accounting for leases by lessors remaining mainly unchanged from current guidance. The update requires that lessees recognize a lease liability and a right of use asset for all leases (with the exception of short-term leases) at the commencement date of the lease and disclose key information about leasing arrangements. The update is to be applied on a modified retrospective basis for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the consolidated financial statements. The update is effective for interim and annual periods beginning after December 15, 2018. In January 2018, the FASB issued a proposal that provides an additional transition method that would allow entities to not apply the guidance in the update in the comparative periods presented in the consolidated financial statements, but instead recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The adoption of the update is not expected to have a significant impact to our consolidated financial statements. In June 2016, the FASB issued Accounting Standards Update No. 2016-13 to ASC 326, “Financial Instruments – Credit Losses.” The update amends existing standards for accounting for credit losses for financial assets. The update requires that the expected credit losses on the financial instruments held as of the end of the period being reported be measured based on historical experience, current conditions, and reasonable and supportable forecasts. The update also expands the required disclosures related to significant estimates and judgements used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s financial assets. The update also amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration and effective for interim and annual periods beginning after December 15, 2019. The change in accounting method represents a significant difference to current accounting practice over the accounting for credit losses on financial assets. We have formed a task force including key members of the teams that work with the current calculation of the allowance for probable loan losses and members representing the corporate accounting and risk management areas. The task force will be working with a plan to develop and implement the changes to current practice with support from third-party vendors. We cannot estimate at this time the impact of ASC 326. In January 2017, the FASB issued Accounting Standards Update No. 2017-04 to ASC 350, “Intangibles – Goodwill and Other.” The update amends existing guidance in evaluating goodwill for impairment. The update requires that an entity perform its annual or interim goodwill test by comparing the fair value of a reporting unit with its carrying amount, with any impairment charges being recognized as the difference between the fair value and carrying value. The update is intended to standardize the impairment test for all business entities and also reduce the complexity and cost of evaluating goodwill for impairment. The update is effective for any annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The adoption of the update is not expected to have a significant impact to our consolidated financial statements. In March 2017, the FASB issued Accounting Standards Update No. 2017-08 to ASC 310, “Receivables – Nonrefundable Fees and Other Costs.” The update amends existing guidance on the amortization period for certain callable debt securities held at a premium. The update shortens the amortization period of the premium to the earliest call date. The update is effective for fiscal years beginning after December 15, 2018. The update is to be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. The adoption of the update did not have a significant impact to our consolidated financial statements. In February 2018, the FASB issued Accounting Standards Update No. 2018-02 to ASC 220, “Income Statement – Reporting Comprehensive Income.” The update amends current guidance surrounding the reclassification of certain tax effects from accumulated other comprehensive income. The update is being issued as a result of the 2017 Tax Cuts and Jobs Act and the related impact to comprehensive income as a result of the application of current guidance with respect to changes in tax rates. Under current guidance, entities must re-evaluate the carrying value of deferred tax assets and liabilities and adjust them for the tax effect of the rate change and record that change through earnings. The result is that the tax effects for items that normally would only be recognized in comprehensive income will be recognized through earnings and results in stranded tax effects in accumulated other comprehensive income (loss) for the impact of the rate change. The update will allow a reclassification from accumulated other comprehensive income (loss) to retained earnings for the stranded tax effects resulting from the 2017 Tax Cuts and Jobs Act. The update is effective for all entities for fiscal years beginning after December 31, 2018. We adopted the provisions of ASU 2018-02 to ASC 220 in the second quarter of 2018. We recorded a one-time reclassification of $5,997,000 between accumulated comprehensive income (loss) and retained earnings as a result of the adoption of the accounting standards update. In August 2018, the FASB issued Accounting Standards Update No. 2018-13 to ASC 820, “Fair Value Measurement.” The update amends the existing guidance surrounding the disclosure of certain fair value measurements. The update removes certain disclosures that are no longer considered cost beneficial, modifies and, in some instances clarifies, the specific requirements of certain disclosures and adds disclosure requirements that are identified relevant. The update is effective for fiscal years beginning after December 15, 2019. The adoption of the update is not expected to have a significant impact on our consolidated financial statements. |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investment Securities | |
Amortized cost and estimated fair value by type of investment security | The amortized cost and estimated fair value by type of investment security at December 31, 2018 are as follows: Held to Maturity Gross Gross Amortized unrealized unrealized Estimated Carrying cost gains losses fair value value (Dollars in Thousands) Other securities $ 1,200 $ — $ — $ 1,200 $ 1,200 Total investment securities $ 1,200 $ — $ — $ 1,200 $ 1,200 Available for Sale Debt Securities Gross Gross Amortized unrealized unrealized Estimated Carrying cost gains losses fair value value (1) (Dollars in Thousands) Residential mortgage-backed securities $ 3,295,366 $ 6,813 $ (79,169) $ 3,223,010 $ 3,223,010 Obligations of states and political subdivisions 185,799 2,646 (105) 188,340 188,340 Total investment securities $ 3,481,165 $ 9,459 $ (79,274) $ 3,411,350 $ 3,411,350 (1) Included in the carrying value of residential mortgage‑ backed securities are $501,293 of mortgage‑backed securities issued by Ginnie Mae and $2,721,717 of mortgage‑backed securities issued by Fannie Mae and Freddie Mac The amortized cost and estimated fair value by type of investment security at December 31, 2017 are as follows: Held to Maturity Gross Gross Amortized unrealized unrealized Estimated Carrying cost gains losses fair value value (Dollars in Thousands) Other securities $ 2,400 $ — $ — $ 2,400 $ 2,400 Total investment securities $ 2,400 $ — $ — $ 2,400 $ 2,400 Available for Sale Gross Gross Estimated Amortized unrealized unrealized fair Carrying cost gains losses value value (1) (Dollars in Thousands) Residential mortgage-backed securities $ 3,943,092 $ 14,110 $ (65,969) $ 3,891,233 $ 3,891,233 Obligations of states and political subdivisions 225,096 7,871 (16) 232,951 232,951 Equity securities 28,075 293 (482) 27,886 27,886 Total investment securities $ 4,196,263 $ 22,274 $ (66,467) $ 4,152,070 $ 4,152,070 (1) Included in the carrying value of residential mortgage‑ backed securities are $654,063 of mortgage‑backed securities issued by Ginnie Mae and $3,237,170 of mortgage‑backed securities issued by Fannie Mae and Freddie Mac |
Amortized cost and fair value of investment securities, by contractual maturity | Held to Maturity Available for Sale Amortized Estimated Amortized Estimated Cost fair value Cost fair value (Dollars in Thousands) Due in one year or less $ — $ — $ — $ — Due after one year through five years 1,200 1,200 — — Due after five years through ten years — — 500 502 Due after ten years — — 185,299 187,838 Residential mortgage-backed securities — — 3,295,366 3,223,010 Total investment securities $ 1,200 $ 1,200 $ 3,481,165 $ 3,411,350 |
Gross unrealized losses on investment securities and the related fair value | Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018 were as follows: Less than 12 months 12 months or more Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses (Dollars in Thousands) Available for sale: Residential mortgage-backed securities $ 208,384 $ (2,124) $ 2,537,181 $ (77,045) $ 2,745,565 $ (79,169) Obligations of states and political subdivisions 12,756 (99) 512 (6) 13,268 (105) $ 221,140 $ (2,223) $ 2,537,693 $ (77,051) $ 2,758,833 $ (79,274) Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position, at December 31, 2017 were as follows: Less than 12 months 12 months or more Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses (Dollars in Thousands) Available for sale: Residential mortgage-backed securities $ 1,061,577 $ (13,157) $ 2,029,455 $ (52,812) $ 3,091,032 $ (65,969) Obligations of states and political subdivisions 5,534 (9) 522 (7) 6,056 (16) Equity securities 11,499 (251) 8,019 (231) 19,518 (482) $ 1,078,610 $ (13,417) $ 2,037,996 $ (53,050) $ 3,116,606 $ (66,467) |
Reconciliation of credit-related impairment charges on available-for-sale investment | The following table presents a reconciliation of credit‑related impairment charges on available‑for‑sale investments recognized in earnings for the twelve months ended December 31, 2017 (in Thousands): Balance at December 31, 2016 $ Sale of other-than-temporarily impaired available-for-sale securities during period (13,931) Balance at December 31, 2017 $ — The following table presents a reconciliation of credit‑related impairment charges on available‑for‑sale investments recognized in earnings for the twelve months ended December 31, 2016 (in Thousands): Balance at December 31, 2015 $ Impairment charges recognized during period Balance at December 31, 2016 $ |
Summary of unrealized and realized gains and losses recognized in net income on equity securities | Year Ended December 31, (Dollars in Thousands) 2018 Net losses recognized during the period on equity securities $ (388) Less: Net gains and (losses) recognized during the period on equity securities sold during the period — Unrealized losses recognized during the reporting period on equity securities still held at the reporting date $ (388) |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Loans | |
Summary of loans, by loan type | December 31, December 31, 2018 2017 (Dollars in Thousands) Commercial, financial and agricultural $ 3,305,124 $ 3,322,668 Real estate - mortgage 1,173,101 1,133,525 Real estate - construction 1,886,231 1,683,550 Consumer 46,316 49,543 Foreign 150,517 158,886 Total loans $ 6,561,289 $ 6,348,172 |
Allowance for Probable Loan L_2
Allowance for Probable Loan Losses (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Allowance for Probable Loan Losses | |
Summary of the transactions in the allowance for probable loan losses by loan class | December 31, 2018 Domestic Foreign Commercial real estate: other Commercial construction & real estate: Commercial land farmland & real estate: Residential: Residential: Commercial development commercial multifamily first lien junior lien Consumer Foreign Total (Dollars in Thousands) Balance at December 31, $ 27,905 $ 11,675 $ 16,663 $ 1,109 $ 2,950 $ 6,103 $ 440 $ 842 $ 67,687 Losses charge to allowance (14,220) (1) (70) — (122) (347) (362) (3) (15,125) Recoveries credited to allowance 1,981 25 246 — 36 369 43 10 2,710 Net losses charged to allowance (12,239) 24 176 — (86) 22 (319) 7 (12,415) Provision (credit) charged to operations (3,070) 3,424 2,514 699 603 1,594 326 22 6,112 Balance at December 31, $ 12,596 $ 15,123 $ 19,353 $ 1,808 $ 3,467 $ 7,719 $ 447 $ 871 $ 61,384 December 31, 2017 Domestic Foreign Commercial real estate: other Commercial construction & real estate: Commercial land farmland & real estate: Residential: Residential: Commercial development commercial multifamily first lien junior lien Consumer Foreign Total (Dollars in Thousands) Balance at December 31, $ 25,649 $ 13,889 $ 16,731 $ 806 $ 2,455 $ 3,716 $ 531 $ 884 $ 64,661 Losses charge to allowance (12,094) (213) (40) — (101) (340) (309) (1) (13,098) Recoveries credited to allowance 4,020 21 527 — 11 258 45 21 4,903 Net losses charged to allowance (8,074) (192) 487 — (90) (82) (264) 20 (8,195) Provision (credit) charged to operations 10,330 (2,022) (555) 303 585 2,469 173 (62) 11,221 Balance at December 31, $ 27,905 $ 11,675 $ 16,663 $ 1,109 $ 2,950 $ 6,103 $ 440 $ 842 $ 67,687 December 31, 2016 Domestic Foreign Commercial real estate: other Commercial construction & real estate: Commercial land farmland & real estate: Residential: Residential: Commercial development commercial multifamily first lien junior lien Consumer Foreign Total (Dollars in Thousands) Balance at December 31, $ 21,431 $ 13,920 $ 19,769 $ 1,248 $ 3,509 $ 5,321 $ 638 $ 1,152 $ 66,988 Losses charge to allowance (32,959) (16) (1,890) (180) (70) (331) (414) (41) (35,901) Recoveries credited to allowance 7,110 6,099 119 — 21 278 69 19 13,715 Net losses charged to allowance (25,849) 6,083 (1,771) (180) (49) (53) (345) (22) (22,186) Provision (credit) charged to operations 30,067 (6,114) (1,267) (262) (1,005) (1,552) 238 (246) 19,859 Balance at December 31, $ 25,649 $ 13,889 $ 16,731 $ 806 $ 2,455 $ 3,716 $ 531 $ 884 $ 64,661 |
Loans individually or collectively evaluated for their impairment and related allowance, by loan class | December 31, 2018 Loans Individually Loans Collectively Evaluated For Evaluated For Impairment Impairment Recorded Recorded Investment Allowance Investment Allowance (Dollars in Thousands) Domestic Commercial $ 9,179 $ 656 $ 1,119,790 $ 11,940 Commercial real estate: other construction & land development 2,092 116 1,884,139 15,007 Commercial real estate: farmland & commercial 3,509 — 1,946,389 19,353 Commercial real estate: multifamily 507 — 225,750 1,808 Residential: first lien 6,244 — 439,556 3,467 Residential: junior lien 901 — 726,400 7,719 Consumer 1,175 — 45,141 447 Foreign 293 — 150,224 871 Total $ 23,900 $ 772 $ 6,537,389 $ 60,612 December 31, 2017 Loans Individually Loans Collectively Evaluated For Evaluated For Impairment Impairment Recorded Recorded Investment Allowance Investment Allowance (Dollars in Thousands) Domestic Commercial $ 17,947 $ 300 $ 1,068,520 $ 27,605 Commercial real estate: other construction & land development 2,455 116 1,681,095 11,559 Commercial real estate: farmland & commercial 33,123 18 2,010,162 16,645 Commercial real estate: multifamily 476 — 192,440 1,109 Residential: first lien 6,852 — 425,925 2,950 Residential: junior lien 723 — 700,025 6,103 Consumer 1,281 — 48,262 440 Foreign 347 — 158,539 842 Total $ 63,204 $ 434 $ 6,284,968 $ 67,253 |
Loans accounted on non-accrual basis, by loan class | December 31, 2018 December 31, 2017 (Dollars in Thousands) Domestic Commercial $ 9,143 $ 17,909 Commercial real estate: other construction & land development 2,092 2,455 Commercial real estate: farmland & commercial 3,509 33,123 Commercial real estate: multifamily 507 476 Residential: first lien 347 712 Residential: junior lien 171 11 Consumer 22 44 Total non-accrual loans $ 15,791 $ 54,730 |
Impaired loans, by loan class | The following tables detail key information regarding our impaired loans by loan class for the year ended December 31, 2018: December 31, 2018 Unpaid Average Recorded Principal Related Recorded Interest Investment Balance Allowance Investment Recognized (Dollars in Thousands) Loans with Related Allowance Domestic Commercial $ 1,563 $ 2,161 $ 656 $ 1,741 $ — Commercial real estate: other construction & land development 135 169 116 141 — Total impaired loans with related allowance $ 1,698 $ 2,330 $ 772 $ 1,882 $ — December 31, 2018 Unpaid Average Recorded Principal Recorded Interest Investment Balance Investment Recognized (Dollars in Thousands) Loans with No Related Allowance Domestic Commercial $ 7,616 $ 7,730 $ 16,194 $ 3 Commercial real estate: other construction & land development 1,957 2,205 2,151 — Commercial real estate: farmland & commercial 3,509 4,031 36,632 — Commercial real estate: multifamily 507 538 565 — Residential: first lien 6,244 6,386 7,136 305 Residential: junior lien 901 911 976 44 Consumer 1,175 1,190 1,211 2 Foreign 293 293 327 14 Total impaired loans with no related allowance $ 22,202 $ 23,284 $ 65,192 $ 368 The following tables detail key information regarding our impaired loans by loan class for the year ended December 31, 2017: December 31, 2017 Unpaid Average Recorded Principal Related Recorded Interest Investment Balance Allowance Investment Recognized (Dollars in Thousands) Loans with Related Allowance Domestic Commercial real estate: other construction & land development $ 1,300 $ 1,577 $ 300 1,346 — Commercial real estate: farmland & commercial 145 169 116 150 — Commercial real estate: multifamily 449 590 18 489 — Total impaired loans with related allowance $ 1,894 $ 2,336 $ 434 $ 1,985 $ — December 31, 2017 Unpaid Average Recorded Principal Recorded Interest Investment Balance Investment Recognized (Dollars in Thousands) Loans with No Related Allowance Domestic Commercial $ 16,646 $ 44,095 $ 19,615 $ 3 Commercial real estate: other construction & land development 2,310 2,455 3,493 — Commercial real estate: farmland & commercial 32,675 33,275 38,536 — Commercial real estate: multifamily 476 505 511 — Residential: first lien 6,852 6,968 7,249 324 Residential: junior lien 723 736 970 45 Consumer 1,281 1,283 1,293 3 Foreign 347 347 750 16 Total impaired loans with no related allowance $ 61,310 $ 89,664 $ 72,417 $ 391 |
Loans accounted for as trouble debt restructuring, by loan class | December 31, 2018 December 31, 2017 (Dollars in Thousands) Domestic Commercial $ 35 $ 6,910 Commercial real estate: farmland & commercial — — Residential: first lien 5,947 6,140 Residential: junior lien 730 712 Consumer 1,153 1,237 Foreign 293 347 Total troubled debt restructuring $ 8,158 $ 15,346 |
Information regarding the aging of past due loans, by loan class | December 31, 2018 90 Days or Total 30 - 59 60 - 89 90 Days or greater & Past Total Days Days Greater still accruing Due Current Portfolio (Dollars in Thousands) Domestic Commercial $ 4,651 $ 1,089 $ 19,851 $ 10,890 $ 25,591 $ 1,103,378 $ 1,128,969 Commercial real estate: other construction & land development 727 1,707 922 16 3,356 1,882,875 1,886,231 Commercial real estate: farmland & commercial 2,928 784 27,239 24,910 30,951 1,918,947 1,949,898 Commercial real estate: multifamily 927 — 578 71 1,505 224,752 226,257 Residential: first lien 3,998 1,677 3,362 3,079 9,037 436,763 445,800 Residential: junior lien 1,155 618 1,108 937 2,881 724,420 727,301 Consumer 486 19 45 32 550 45,766 46,316 Foreign 1,106 117 739 739 1,962 148,555 150,517 Total past due loans $ 15,978 $ 6,011 $ 53,844 $ 40,674 $ 75,833 $ 6,485,456 $ 6,561,289 December 31, 2017 90 Days or Total 30 - 59 60 - 89 90 Days or greater & Past Total Days Days Greater still accruing Due Current Portfolio (Dollars in Thousands) Domestic Commercial $ 3,790 $ 398 $ 18,308 $ 537 $ 22,496 $ 1,063,971 $ 1,086,467 Commercial real estate: other construction & land development 354 308 820 6 1,482 1,682,068 1,683,550 Commercial real estate: farmland & commercial 3,925 518 31,133 954 35,576 2,007,709 2,043,285 Commercial real estate: multifamily 84 — 476 — 560 192,356 192,916 Residential: first lien 4,295 2,458 4,095 3,861 10,848 421,929 432,777 Residential: junior lien 1,310 580 1,110 1,099 3,000 697,748 700,748 Consumer 868 98 160 133 1,126 48,417 49,543 Foreign 1,229 69 667 667 1,965 156,921 158,886 Total past due loans $ 15,855 $ 4,429 $ 56,769 $ 7,257 $ 77,053 $ 6,271,119 $ 6,348,172 |
Summary of the loan portfolio by credit quality indicator, by loan class | December 31, 2018 Special Watch Watch List— Watch List— Pass Review List—Pass Substandard Impaired (Dollars in Thousands) Domestic Commercial $ 998,625 $ 441 $ 44,544 $ 76,180 $ 9,179 Commercial real estate: other construction & land development 1,817,098 1,648 9,055 56,338 2,092 Commercial real estate: farmland & commercial 1,726,711 62,046 38,373 119,259 3,509 Commercial real estate: multifamily 224,823 — — 927 507 Residential: first lien 438,773 — 142 641 6,244 Residential: junior lien 725,538 — 862 — 901 Consumer 45,141 — — — 1,175 Foreign 150,224 — — — 293 Total $ 6,126,933 $ 64,135 $ 92,976 $ 253,345 $ 23,900 December 31, 2017 Special Watch Watch List— Watch List— Pass Review List—Pass Substandard Impaired (Dollars in Thousands) Domestic Commercial $ 905,707 $ — $ 3,170 $ 159,643 $ 17,947 Commercial real estate: other construction & land development 1,616,604 1,288 672 62,531 2,455 Commercial real estate: farmland & commercial 1,863,763 5,134 41,820 99,445 33,123 Commercial real estate: multifamily 192,440 — — — 476 Residential: first lien 425,811 40 — 74 6,852 Residential: junior lien 699,875 150 — — 723 Consumer 48,262 — — — 1,281 Foreign 158,539 — — — 347 Total $ 5,911,001 $ 6,612 $ 45,662 $ 321,693 $ 63,204 |
Bank Premises and Equipment (Ta
Bank Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Bank Premises and Equipment | |
Summary of bank premises and equipment, by asset classification | Estimated useful lives 2018 2017 (Dollars in Thousands) Bank buildings and improvements 5 - 40 years $ 563,302 $ 550,094 Furniture, equipment and vehicles 1 - 20 years 292,958 289,743 Land 118,806 123,087 Real estate held for future expansion: Land, building, furniture, fixture and equipment 7 - 27 years — — Less: accumulated depreciation (468,167) (448,470) Bank premises and equipment, net $ 506,899 $ 514,454 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Other Intangible Assets | |
Schedule of the entity's identified intangible assets | Carrying Accumulated Amount Amortization Net (Dollars in Thousands) December 31, 2018: Core deposit premium $ 58,675 $ 58,675 $ — Identified intangible (contract rights) 2,022 2,022 — Total identified intangibles $ 60,697 $ 60,697 $ — December 31, 2017: Core deposit premium $ 58,675 $ 58,675 $ — Identified intangible (contract rights) 2,022 2,022 — Total identified intangibles $ 60,697 $ 60,697 $ — |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits. | |
Schedule of deposits and related interest expense | 2018 2017 (Dollars in Thousands) Deposits: Demand - non-interest bearing Domestic $ 2,758,768 $ 2,609,932 Foreign 696,072 633,323 Total demand non-interest bearing 3,454,840 3,243,255 Savings and interest bearing demand Domestic 2,531,854 2,615,143 Foreign 736,383 629,988 Total savings and interest bearing demand 3,268,237 3,245,131 Time, certificates of deposit $100,000 or more Domestic 590,895 637,006 Foreign 807,486 808,881 Less than $100,000 Domestic 323,377 354,998 Foreign 251,710 255,621 Total time, certificates of deposit 1,973,468 2,056,506 Total deposits $ 8,696,545 $ 8,544,892 2018 2017 2016 (Dollars in Thousands) Interest expense: Savings and interest bearing demand Domestic $ 11,029 $ 5,453 $ 3,922 Foreign 1,735 755 640 Total savings and interest bearing demand 12,764 6,208 4,562 Time, certificates of deposit $100,000 or more Domestic 4,741 3,644 3,881 Foreign 5,798 4,105 3,929 Less than $100,000 Domestic 1,589 1,312 1,447 Foreign 968 675 706 Total time, certificates of deposit 13,096 9,736 9,963 Total interest expense on deposits $ 25,860 $ 15,944 $ 14,525 |
Scheduled maturities of time deposits | Scheduled maturities of time deposits as of December 31, 2018 were as follows: Total (in thousands) 2019 $ 1,786,776 2020 138,105 2021 31,665 2022 15,717 2023 1,096 Thereafter 109 Total $ 1,973,468 |
Scheduled maturities of time deposits in amounts of $100,000 or more | Total (in thousands) Due within 3 months or less $ 500,836 Due after 3 months and within 6 months 337,349 Due after 6 months and within 12 months 433,628 Due after 12 months 126,568 $ 1,398,381 |
Securities Sold Under Repurch_2
Securities Sold Under Repurchase Agreements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Securities Sold Under Repurchase Agreements | |
Schedule of repurchase agreements | Collateral Securities Repurchase Borrowing Book Value of Fair Value of Balance of Weighted Average Securities Sold Securities Sold Liability Interest Rate (Dollars in Thousands) December 31, 2018 term: Overnight agreements $ 357,642 $ 349,081 $ 218,852 0.85 % 1 to 29 days — — — — 30 to 90 days — — — — Over 90 days 11,444 11,096 11,137 1.27 Total $ 369,086 $ 360,177 $ 229,989 0.87 % December 31, 2017 term: Overnight agreements $ 340,054 $ 334,506 $ 242,824 0.25 % 1 to 29 days — — — — 30 to 90 days 109,300 107,238 100,000 3.99 Over 90 days 11,327 11,168 10,981 0.74 Total $ 460,681 $ 452,912 $ 353,805 1.32 % |
Other Borrowed Funds (Tables)
Other Borrowed Funds (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Borrowed Funds | |
Schedule of other borrowed funds | December 31, 2018 2017 (Dollars in Thousands) Federal Home Loan Bank advances—short-term Balance at year end $ 268,975 $ 945,225 Rate on balance outstanding at year end 2.70 % 1.44 % Average daily balance $ 621,357 $ 839,858 Average rate 1.97 % 1.23 % Maximum amount outstanding at any month end $ 1,007,100 $ 1,043,250 Federal Home Loan Bank advances—long-term (1) Balance at year end $ 436,690 $ 250,000 Rate on balance outstanding at year end 1.73 % 1.26 % Average daily balance $ 302,373 $ 51,644 Average rate 1.71 % 1.26 % Maximum amount outstanding at any month end $ 436,700 $ 250,000 Long-term advances at December 31, 2018 consisted of both amortizing and non-amortizing advances. The non-amortizing advances mature in the following increments: $75,000,000 in July 2028, $100,000,000 in March 2033 and $250,000,000 in August 2033 and are callable by the FHLB on an annual basis. Two amortizing advances are outstanding at December 31, 2018 in the amounts of $3,200,000 and $8,490,000 and mature in December 2033 and November 2033, respectively. The amortization on the amortizing long-term advances totals approximately $179,000 per year for each of the next five years. Long-term advances outstanding at December 31, 2017 mature in the following increments: $100,000,000 in November 2027 and $150,000,000 in December 2027 and are callable by the FHLB on a quarterly basis. |
Junior Subordinated Interest _2
Junior Subordinated Interest Deferrable Debentures (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Junior Subordinated Interest Deferrable Debentures | |
Junior subordinated deferrable interest debentures, major types of business trusts | The following table illustrates key information about each of the Debentures and their interest rates at December 31, 2018: Junior Subordinated Deferrable Interest Repricing Interest Interest Optional Debentures Frequency Rate Rate Index(1) Maturity Date Redemption Date (1) (Dollars in Thousands) Trust VI $ 25,774 Quarterly 6.07 % LIBOR + November 2032 February 2008 Trust VIII 25,774 Quarterly 5.49 % LIBOR + October 2033 October 2008 Trust IX 41,238 Quarterly 4.02 % LIBOR + October 2036 October 2011 Trust X 21,021 Quarterly 4.19 % LIBOR + February 2037 February 2012 Trust XI 25,990 Quarterly 4.02 % LIBOR + July 2037 July 2012 Trust XII 20,619 Quarterly 4.19 % LIBOR + September 2037 September 2012 $ 160,416 (1) The Capital Securities may be redeemed in whole or in part on any interest payment date after the Optional Redemption Date. |
Earnings per Share ("EPS") (Tab
Earnings per Share ("EPS") (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings per Share ("EPS") | |
Schedule of calculation of the basic EPS and the diluted EPS | Net Income Shares Per Share (Numerator) (Denominator) Amount (Dollars in Thousands, Except Per Share Amounts) December 31, 2018: Basic EPS Net income available to common shareholders $ 215,931 66,106,580 $ 3.27 Potential dilutive common shares and warrants — 527,240 Diluted EPS $ 215,931 66,633,820 $ 3.24 December 31, 2017: Basic EPS Net income available to common shareholders $ 157,436 66,046,155 $ 2.38 Potential dilutive common shares and warrants — 732,281 Diluted EPS $ 157,436 66,778,436 $ 2.36 December 31, 2016: Basic EPS Net income available to common shareholders $ 133,932 65,967,989 $ 2.03 Potential dilutive common shares — 345,501 Diluted EPS $ 133,932 66,313,490 $ 2.02 |
International Operations (Table
International Operations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
International Operations | |
Summary of assets attributable to international operations | 2018 2017 (Dollars in Thousands) Loans: Commercial $ 101,955 $ 113,019 Others 48,562 45,867 150,517 158,886 Less allowance for probable loan losses (842) Net loans $ 149,646 $ 158,044 Accrued interest receivable $ 811 $ 671 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes | |
Schedule of current and deferred portions of net income tax expense | 2018 2017 2016 (Dollars in Thousands) Current U.S. $ 48,144 $ 56,974 $ 52,403 State 3,370 2,662 3,362 Foreign (5) — — Total current taxes 51,509 59,636 55,765 Deferred U.S. 5,130 4,620 7,279 State 13 (50) 27 Total deferred taxes 5,143 4,570 7,306 Total income taxes $ 56,652 $ 64,206 $ 63,071 |
Schedule of income tax expense differences from the amount computed by applying the U.S. Federal income tax rate to income before income taxes | 2018 2017 2016 (Dollars in Thousands) Computed expected tax expense $ 57,831 $ 77,643 $ 69,253 Change in taxes resulting from: Tax-exempt interest income (3,101) (4,701) (3,940) State tax, net of federal income taxes, tax credit and refunds 2,673 1,697 3,287 Resolution of IRS exam — (4,985) — Other investment income (1,561) (3,198) (3,694) Deferred tax adjustment due to federal tax rate change (1,618) (3,168) — Net investment expense, low income housing investments 2,518 387 — Other (90) 531 (1,835) Actual tax expense $ 56,652 $ 64,206 $ 63,071 |
Schedule of tax effects of temporary difference that give rise to significant portions of the deferred tax assets and deferred tax liabilities | 2018 2017 (Dollars in Thousands) Deferred tax assets: Loans receivable, principally due to the allowance for probable loan losses $ 12,257 $ 14,546 Other real estate owned 2,459 2,053 Impairment charges on available-for-sale securities 1,054 844 Accrued expenses 81 81 Net unrealized losses on available for sale investment securities 15,182 9,680 Other 5,076 4,434 Total deferred tax assets 36,109 31,638 Deferred tax liabilities: Bank premises and equipment, principally due to differences on depreciation (12,596) (10,940) Identified intangible assets and goodwill (13,490) (13,417) Other (14,787) (12,474) Total deferred tax liabilities (40,873) (36,831) Net deferred tax liability $ (4,764) $ (5,193) |
Stock Options (Tables)
Stock Options (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Stock Options | |
Schedule of Black-Scholes-Merton option valuation model assumptions | 2018 2017 Expected Life (Years) 7.00 — Dividend yield 1.73 % — % Interest rate 2.68 % — % Volatility 31.65 % — % (1) No stock options were granted during the twelve months ended December 31, 2017. |
Summary of option activity under stock option plans | Weighted Weighted average average remaining Aggregate Number of exercise contractual intrinsic options price term (years) value ($) (in Thousands) Options outstanding at December 31, 2017 668,166 $ Plus: Options granted 234,700 Less: Options exercised 84,701 Options expired — — Options forfeited 29,188 Options outstanding at December 31, 2018 788,977 $ 7,587 Options fully vested and exercisable at December 31, 2018 310,108 $ $ 4,486 |
Schedule of other information pertaining to option activity | Twelve Months Ended December 31, 2018 2017 2016 Weighted average grant date fair value of stock options granted $ 11.78 $ — $ 8.74 Total fair value of stock options vested $ 1,077,000 $ 1,182,000 $ 1,015,000 Total intrinsic value of stock options exercised $ 2,045,000 $ 2,595,000 $ 792,000 (1) No stock options were granted during the twelve months ended December 31, 2017. |
Commitments, Contingent Liabi_2
Commitments, Contingent Liabilities and Other Matters (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments, Contingent Liabilities and Other Tax Matters | |
Schedule of future minimum lease payments due under non-cancellable operating leases | Total (in thousands) 2019 $ 3,443 2020 3,246 2021 2,272 2022 579 2023 212 Thereafter 275 Total $ 10,027 |
Financial Instruments with Of_2
Financial Instruments with Off-Statement of Condition Risk and Concentrations of Credit Risk (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Financial Instruments with Off-Statement of Condition Risk and Concentrations of Credit Risk | |
Schedule of financial amounts of instruments, whose contract amounts represent credit risks | Commitments to extend credit $ 2,935,768,000 Credit card lines 21,114,000 Standby letters of credit 111,229,000 Commercial letters of credit 8,073,000 |
Capital Requirements (Tables)
Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Capital Requirements | |
Schedule of the Company's and the bank subsidiaries' actual capital amounts and ratios | Our actual capital amounts and ratios for 2018 under current guidelines are presented in the following table: For Capital Adequacy To Be Well-Capitalized Purposes Under Prompt Corrective Actual Phase In Schedule Action Provisions Amount Ratio Amount Ratio Amount Ratio (greater than (greater than (greater than (greater than or equal to) or equal to) or equal to) or equal to) (Dollars in Thousands) As of December 31, 2018: Common Equity Tier 1 (to Risk Weighted Assets): Consolidated $ 1,711,682 17.55 % $ 621,850 6.375 % N/A N/A International Bank of Commerce, Laredo 1,201,462 17.24 444,207 6.375 $ 452,917 % International Bank of Commerce, Oklahoma 188,997 13.95 86,344 6.375 88,037 International Bank of Commerce, Brownsville 177,456 24.73 45,741 6.375 46,638 International Bank of Commerce, Zapata 70,984 30.77 14,707 6.375 14,996 Commerce Bank 89,305 32.95 17,276 6.375 17,615 Total Capital (to Risk Weighted Assets): Consolidated $ 1,925,905 19.74 % $ 963,258 9.875 % N/A N/A International Bank of Commerce, Laredo 1,248,107 17.91 688,086 9.875 $ 696,796 % International Bank of Commerce, Oklahoma 198,293 14.64 133,749 9.875 135,442 International Bank of Commerce, Brownsville 183,554 25.58 70,854 9.875 71,750 International Bank of Commerce, Zapata 73,726 31.96 22,782 9.875 23,070 Commerce Bank 90,894 33.54 26,761 9.875 27,100 Tier 1 Capital (to Risk Weighted Assets): Consolidated $ 1,859,536 19.06 % $ 768,168 7.875 % N/A N/A International Bank of Commerce, Laredo 1,201,462 17.24 548,727 7.875 $ 557,437 % International Bank of Commerce, Oklahoma 188,997 13.95 106,660 7.875 108,354 International Bank of Commerce, Brownsville 177,456 24.73 56,503 7.875 57,400 International Bank of Commerce, Zapata 70,984 30.77 18,168 7.875 18,456 Commerce Bank 89,305 32.95 21,341 7.875 21,680 Tier 1 Capital (to Average Assets): Consolidated $ 1,859,536 15.87 % $ 468,593 % $ N/A N/A International Bank of Commerce, Laredo 1,201,462 14.45 332,507 415,634 % International Bank of Commerce, Oklahoma 188,997 12.53 60,344 75,430 International Bank of Commerce, Brownsville 177,456 17.25 41,144 51,430 International Bank of Commerce, Zapata 70,984 16.22 17,507 21,884 Commerce Bank 89,305 15.53 23,000 28,750 Our actual capital amounts and ratios for 2017 are also presented in the following table: To Be Well-Capitalized For Capital Adequacy Under Prompt Corrective Actual Purposes Action Provisions Amount Ratio Amount Ratio Amount Ratio (greater than (greater than (greater than (greater than or equal to) or equal to) or equal to) or equal to) (Dollars in Thousands) As of December 31, 2017: Common Equity Tier 1 (to Risk Weighted Assets): Consolidated $ 1,584,665 % $ 532,579 % N/A N/A International Bank of Commerce, Laredo 1,119,173 376,245 $ 425,320 % International Bank of Commerce, Oklahoma 169,279 72,586 82,054 International Bank of Commerce, Brownsville 165,034 36,583 41,355 International Bank of Commerce, Zapata 66,406 12,487 14,116 Commerce Bank 79,330 13,733 15,524 Total Capital (to Risk Weighted Assets): Consolidated $ 1,807,107 % $ 856,757 % N/A N/A % International Bank of Commerce, Laredo 1,173,068 605,263 $ 654,339 International Bank of Commerce, Oklahoma 178,057 116,769 126,237 International Bank of Commerce, Brownsville 170,613 58,851 63,623 International Bank of Commerce, Zapata 68,718 20,088 21,717 Commerce Bank 81,278 22,092 23,884 Tier 1 Capital (to Risk Weighted Assets): % Consolidated $ 1,734,595 % $ 671,512 % N/A N/A International Bank of Commerce, Laredo 1,119,173 474,395 $ 523,471 International Bank of Commerce, Oklahoma 169,279 91,521 100,989 International Bank of Commerce, Brownsville 165,034 46,127 50,899 International Bank of Commerce, Zapata 66,406 15,745 17,374 Commerce Bank 79,330 17,316 19,107 % Tier 1 Capital (to Average Assets): Consolidated $ 1,734,595 % $ 474,675 % $ N/A N/A International Bank of Commerce, Laredo 1,119,173 333,166 416,458 International Bank of Commerce, Oklahoma 169,279 59,854 74,818 International Bank of Commerce, Brownsville 165,034 38,440 48,050 International Bank of Commerce, Zapata 66,406 18,701 23,376 Commerce Bank 79,330 21,789 27,236 |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value | |
Assets and liabilities measured at fair value on a recurring basis | The following table represents financial instruments reported on the consolidated statements of condition at their fair value as of December 31, 2018 by level within the fair value measurement hierarchy. Fair Value Measurements at Reporting Date Using (in Thousands) Quoted Prices in Active Significant Assets/Liabilities Markets for Other Significant Measured at Identical Observable Unobservable Fair Value Assets Inputs Inputs December 31, 2018 (Level 1) (Level 2) (Level 3) Measured on a recurring basis: Assets: Available for sale debt securities Residential mortgage-backed securities $ 3,223,010 $ — $ 3,223,010 $ — States and political subdivisions 188,340 — 188,340 — Equity securities with readily determinable fair values 5,937 5,937 — — $ 3,417,287 $ 5,937 $ 3,411,350 $ — The following table represents financial instruments reported on the consolidated balance sheets at their fair value as of December 31, 2017 by level within the fair value measurement hierarchy. Fair Value Measurements at Reporting Date Using (in Thousands) Quoted Prices in Active Significant Assets/Liabilities Markets for Other Significant Measured at Identical Observable Unobservable Fair Value Assets Inputs Inputs December 31, 2017 (Level 1) (Level 2) (Level 3) Measured on a recurring basis: Assets: Available for sale securities Residential mortgage - backed securities $ 3,891,233 $ — $ 3,891,233 $ — States and political subdivisions 232,951 — 232,951 — Equity securities with readily determinable fair values 27,886 27,886 — — $ 4,152,070 $ 27,886 $ 4,124,184 $ — |
Assets measured at fair value on a non-recurring basis | The following table represents financial instruments measured at fair value on a non‑recurring basis as of and for the period ended December 31, 2018 by level within the fair value measurement hierarchy: Fair Value Measurements at Reporting Date Using (in thousands) Quoted Assets/Liabilities Prices in Measured at Active Significant Fair Value Markets for Other Significant Net Provision Year ended Identical Observable Unobservable (Credit) December 31, Assets Inputs Inputs During 2018 (Level 1) (Level 2) (Level 3) Period Measured on a non-recurring basis: Assets: Impaired loans $ 1,563 $ — $ — $ 1,563 $ 356 Other real estate owned 38,871 — — 38,871 3,071 The following table represents financial instruments measured at fair value on a non‑recurring basis as of and for the year ended December 31, 2017 by level within the fair value measurement hierarchy: Fair Value Measurements at Reporting Date Using (in thousands) Quoted Assets/Liabilities Prices in Measured at Active Significant Fair Value Markets Other Significant Net (Credit) Year ended for Identical Observable Unobservable Provision December 31, Assets Inputs Inputs During 2017 (Level 1) (Level 2) (Level 3) Period Measured on a non-recurring basis: Assets: Impaired loans $ 11,210 $ — $ — $ 11,210 $ 2,138 Other real estate owned 2,000 — — 2,000 710 |
International Bancshares Corp_4
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition | |
Schedule of condensed statements of condition of Parent Company | (Dollars in Thousands) 2018 2017 ASSETS Cash $ 19,065 $ 18,398 Other investments 105,377 92,620 Investment in subsidiaries 1,987,293 1,878,521 Other assets — 23,120 Total assets $ 2,111,735 $ 2,012,659 LIABILITIES AND SHAREHOLDERS’ EQUITY Liabilities: Junior subordinated deferrable interest debentures $ 160,416 $ 160,416 Due to IBC Trading 21 21 Other liabilities 11,716 13,242 Total liabilities 172,153 173,679 Shareholders’ equity: Common shares 96,104 96,019 Surplus 145,283 171,816 Retained earnings 2,064,134 1,891,805 Accumulated other comprehensive (loss) income (54,634) (28,397) 2,250,887 2,131,243 Less cost of shares in treasury (311,305) (292,263) Total shareholders’ equity 1,939,582 1,838,980 Total liabilities and shareholders’ equity $ 2,111,735 $ 2,012,659 |
International Bancshares Corp_5
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income | |
Schedule of condensed statements of income of Parent Company | (Dollars in Thousands) 2018 2017 2016 Income: Dividends from subsidiaries $ 105,000 $ 64,600 $ 84,432 Interest income on notes receivable — — 2 Interest income on other investments 8,208 8,100 8,958 Other 1,988 26 255 Total income 115,196 72,726 93,647 Expenses: Interest expense (Debentures) 6,989 5,392 4,600 Other 2,930 5,648 3,637 Total expenses 9,919 11,040 8,237 Income before federal income taxes and equity in undistributed net income of subsidiaries 105,277 61,686 85,410 Income tax expense 481 (2,076) 311 Income before equity in undistributed net income of subsidiaries 104,796 63,762 85,099 Equity in undistributed net income of subsidiaries 111,135 93,674 48,833 Net income $ 215,931 $ 157,436 $ 133,932 |
International Bancshares Corp_6
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows | |
Schedule of condensed statements of cash flows of Parent Company | (Dollars in Thousands) 2018 2017 2016 Operating activities: Net income $ 215,931 $ 157,436 $ 133,932 Adjustments to reconcile net income to net cash provided by operating activities: Investment securities transactions, net — (23) — Unrealized loss on equity securities with readily determinable fair values 330 — — Impairment charges on available for sale securities — — 112 Stock compensation expense 1,035 903 1,082 (Decrease) increase in other liabilities (1,479) (3,453) 3,901 Equity in undistributed net income of subsidiaries (111,135) (93,674) (48,833) Net cash provided by operating activities 104,682 61,189 90,194 Investing activities: Principal collected on mortgage-backed securities — 6,328 1,105 Net decrease in notes receivable — — 99 Increase in other assets and other investments (7,891) (25,348) (27,834) Net cash used in investing activities (7,891) (19,020) (26,630) Financing activities: Redemption of long-term debt — — (1,000) Proceeds from stock transactions 1,522 1,455 549 Payments of cash dividends - common (49,599) (43,594) (39,569) Repurchase of outstanding common stock warrant (29,005) — — Purchase of treasury stock (19,042) (187) (7,966) Net cash used in financing activities (96,124) (42,326) (47,986) Increase (decrease) in cash 667 (157) 15,578 Cash at beginning of year 18,398 18,555 2,977 Cash at end of year $ 19,065 $ 18,398 $ 18,555 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | Oct. 01, 2018USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($)item | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Number of insurance-related subsidiaries | item | 1 | ||||
Investment Securities | |||||
Number of components in which other-than-temporary impairment is segregated | item | 2 | ||||
Non-Accrual Loans | |||||
Period of charge off for past due unsecured consumer loans | 90 days | ||||
Minimum period that past due unsecured loans outstanding may not be placed on nonaccrual status under special circumstances | 90 days | ||||
Maximum period of non-consumer loans outstanding that is used to evaluate whether loans should be placed on non-accrual status | 90 days | ||||
Other Real Estate Owned and Reposessed Assets | |||||
Other real estate owned | $ 57,344,000 | $ 30,519,000 | |||
Reposessed assets | $ 6,454,000 | 303,000 | |||
Income Taxes | |||||
Percentage of likelihood of realization of recognized tax benefit | 50.00% | ||||
Liability for unrecognized tax benefits | $ 0 | 0 | |||
Interest expense related to uncertain tax positions | 0 | 0 | $ 0 | ||
Penalties related to uncertain tax positions | 0 | $ 0 | $ 0 | ||
Goodwill and Identified Intangible Assets | |||||
Goodwill impairment loss | $ 0 | ||||
Impairment of identified intangible assets | $ 0 | ||||
Segments of an Enterprise and Related Information | |||||
Number of operating segments | item | 1 | ||||
Number of active operating bank subsidiaries | item | 5 | ||||
New Accounting Standards | |||||
One-time reclassification from AOCI to retained earnings, relating to the Tax Cuts and Jobs Act of 2017 | $ 5,997,000 | ||||
Equity securities with readily determinable fair values | |||||
New Accounting Standards | |||||
Net unrealized loss on available-for-sale equity securities | $ 189,000 |
Investment Securities (Details)
Investment Securities (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Held-to-maturity securities | ||
Amortized cost | $ 1,200,000 | $ 2,400,000 |
Estimated fair value | 1,200,000 | 2,400,000 |
Carrying Value | 1,200,000 | 2,400,000 |
Available-for-sale securities | ||
Amortized cost, Available-for-sale securities | 3,481,165,000 | 4,196,263,000 |
Gross Unrealized Gains | 9,459,000 | |
Gross Unrealized Losses | (79,274,000) | |
Available for sale debt securities | 3,411,350,000 | 4,124,184,000 |
Equity Securities | 5,937,000 | 27,886,000 |
Total Amortized cost | 3,481,165,000 | 4,196,263,000 |
Total Gross unrealized gains | 22,274,000 | |
Total Gross unrealized losses | 66,467,000 | |
Available for sale debt securities and equity securities | 3,411,350,000 | |
Assets/liabilities measured at fair value | ||
Available-for-sale securities | ||
Total Amortized cost | 4,152,070,000 | |
Available for sale debt securities and equity securities | 3,411,350,000 | |
Carrying Value | ||
Available-for-sale securities | ||
Available for sale debt securities and equity securities | 3,411,350,000 | 4,152,070,000 |
Residential mortgage-backed securities | ||
Available-for-sale securities | ||
Amortized cost, Available-for-sale securities | 3,295,366,000 | 3,943,092,000 |
Gross Unrealized Gains | 6,813,000 | 14,110,000 |
Gross Unrealized Losses | (79,169,000) | (65,969,000) |
Residential mortgage-backed securities | Assets/liabilities measured at fair value | ||
Available-for-sale securities | ||
Available for sale debt securities | 3,223,010,000 | 3,891,233,000 |
Residential mortgage-backed securities | Carrying Value | ||
Available-for-sale securities | ||
Available for sale debt securities | 3,223,010,000 | 3,891,233,000 |
Mortgage-backed securities by Ginnie Mae | ||
Available-for-sale securities | ||
Available for sale debt securities | 501,293,000 | 654,063,000 |
Mortgage-backed securities by Fannie Mae and Freddie Mac | ||
Available-for-sale securities | ||
Available for sale debt securities | 2,721,717,000 | 32,371,700 |
Obligations of states and political subdivisions | ||
Available-for-sale securities | ||
Amortized cost, Available-for-sale securities | 185,799,000 | 225,096,000 |
Gross Unrealized Gains | 2,646,000 | 7,871,000 |
Gross Unrealized Losses | (105,000) | (16,000) |
Obligations of states and political subdivisions | Assets/liabilities measured at fair value | ||
Available-for-sale securities | ||
Available for sale debt securities | 188,340,000 | 232,951,000 |
Obligations of states and political subdivisions | Carrying Value | ||
Available-for-sale securities | ||
Available for sale debt securities | 188,340,000 | 232,951,000 |
Other securities | ||
Held-to-maturity securities | ||
Amortized cost | 1,200,000 | 2,400,000 |
Estimated fair value | 1,200,000 | 2,400,000 |
Carrying Value | $ 1,200,000 | 2,400,000 |
Equity securities with readily determinable fair values | ||
Available-for-sale securities | ||
Amortized Cost, Equity securities | 28,075,000 | |
Gross Unrealized Gains, Equity securities | 293,000 | |
Gross Unrealized Losses, Equity securities | (482,000) | |
Equity securities with readily determinable fair values | Assets/liabilities measured at fair value | ||
Available-for-sale securities | ||
Equity Securities | 27,886,000 | |
Equity securities with readily determinable fair values | Carrying Value | ||
Available-for-sale securities | ||
Equity Securities | $ 27,886,000 |
Investment Securities (Contract
Investment Securities (Contractual Maturities and Estimated Fair Values) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Held-to-maturity debt securities amortized cost disclosures | |||
Due after one year through five years, held-to-maturity debt securities amortized cost | $ 1,200,000 | ||
Amortized cost, held-to-maturity debt securities | 1,200,000 | $ 2,400,000 | |
Held-to-maturity debt securities, Estimated fair value disclosures | |||
Due after one year through five years, held-to-maturity debt securities, Estimated fair value | 1,200,000 | ||
Estimated fair value | 1,200,000 | 2,400,000 | |
Available-for-sale debt securities amortized cost disclosures | |||
Due after five years through ten years, available-for-sale debt securities amortized cost | 500,000 | ||
Due after ten years, available-for-sale debt securities amortized cost | 185,299,000 | ||
Residential mortgage-backed securities, amortized cost | 3,295,366,000 | ||
Amortized cost, Available-for-sale securities | 3,481,165,000 | 4,196,263,000 | |
Available for sale debt securities, Estimated Fair Value Disclosures | |||
Due after five years through ten years, available-for-sale debt securities, Estimated Fair Value | 502,000 | ||
Due after ten years, available-for-sale debt securities, Estimated Fair Value | 187,838,000 | ||
Residential mortgage-backed securities, Estimated Fair Value | 3,223,010,000 | ||
Estimated fair value, Available for sale securities | 3,411,350,000 | 4,124,184,000 | |
Proceeds from sales and calls of available for sale securities | 38,175,000 | 396,066,000 | $ 352,743,000 |
Proceeds from sales of mortgage-backed securities | 0 | 377,756,000 | 338,138,000 |
Gross gains realized on sales | 3,000 | 1,186,000 | 586,000 |
Gross losses realized on sales | 144,000 | $ 5,960,000 | $ 3,212,000 |
Collateral Pledged | |||
Available-for-sale debt securities amortized cost disclosures | |||
Amortized cost, Available-for-sale securities | 1,112,852,000 | ||
Available for sale debt securities, Estimated Fair Value Disclosures | |||
Fair value of available for sale investment securities pledged | $ 1,086,360,000 |
Investment Securities (Fair Val
Investment Securities (Fair Value and Gross Unrealized Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2018 | |
Available for sale: | ||
Fair value, less than 12 months | $ 221,140 | |
Marketable securities, less than 12 months | $ 1,078,610 | |
Unrealized losses, less than 12 Months | (2,223) | |
Marketable securities, less than 12 Months | (13,417) | |
Fair value, 12 months or more | (2,537,693) | |
Marketable securities, 12 months or more | 2,037,996 | |
Unrealized losses, 12 Months or More | (77,051) | |
Marketable securities, 12 Months or More | (53,050) | |
Fair value, Total | 2,758,833 | |
Marketable securities, Total | (3,116,606) | |
Unrealized losses, Total | (79,274) | |
Marketable securities, Total | (66,467) | |
Residential mortgage-backed securities | ||
Available for sale: | ||
Fair value, less than 12 months | 1,061,577 | 208,384 |
Unrealized losses, less than 12 Months | (13,157) | (2,124) |
Fair value, 12 months or more | (2,029,455) | (2,537,181) |
Unrealized losses, 12 Months or More | (52,812) | (77,045) |
Fair value, Total | 3,091,032 | 2,745,565 |
Unrealized losses, Total | (65,969) | (79,169) |
Obligations of states and political subdivisions | ||
Available for sale: | ||
Fair value, less than 12 months | 5,534 | 12,756 |
Unrealized losses, less than 12 Months | (9) | (99) |
Fair value, 12 months or more | (522) | (512) |
Unrealized losses, 12 Months or More | (7) | (6) |
Fair value, Total | 6,056 | 13,268 |
Unrealized losses, Total | (16) | $ (105) |
Equity securities with readily determinable fair values | ||
Available for sale: | ||
Equity Securities, less than 12 months | 11,499 | |
Equity Securities, less than 12 Months | (251) | |
Equity Securities, 12 months or more | (8,019) | |
Equity Securities, 12 Months or More | (231) | |
Equity Securities, Total | (19,518) | |
Equity securities | $ (482) |
Investment Securities (Reconcil
Investment Securities (Reconciliation of Credit Related Impairment Charges ) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of credit-related impairment charges on investments recognized in earnings | ||
Impairment charges on available-for-sale investment securities, after tax | $ 354,000 | $ 230,100 |
Available-for-sale investments | ||
Reconciliation of credit-related impairment charges on investments recognized in earnings | ||
Balance at the beginning | 13,931,000 | 13,577,000 |
Sale of other-than-temporarily impaired available-for-sale securities during period | $ (13,931,000) | |
Impairment charges recognized during period | (354,000) | |
Balance at the end | $ 13,931,000 |
Investment Securities and Equit
Investment Securities and Equity Securities with Readily Determinable Fair Values (Unrealized and realized gains and losses recognized in net income on equity securities ) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Investment Securities | ||
Equity Securities | $ 5,937,000 | $ 27,886,000 |
Summary of unrealized and realized gains and losses recognized in net income on equity securities | ||
Net losses recognized during the period on equity securities | (388,000) | |
Unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting date | (388,000) | |
Impairment charges on available-for-sale investment securities, after tax | $ 354,000 | $ 230,100 |
Loans (Details)
Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Summary of loans, by loan type | ||
Total loans | $ 6,561,289 | $ 6,348,172 |
Commercial, financial and agricultural | ||
Summary of loans, by loan type | ||
Total loans | 3,305,124 | 3,322,668 |
Real estate - mortgage | ||
Summary of loans, by loan type | ||
Total loans | 1,173,101 | 1,133,525 |
Commercial Real Estate:Other Construction and Land Development | ||
Summary of loans, by loan type | ||
Total loans | 1,886,231 | 1,683,550 |
Consumer | ||
Summary of loans, by loan type | ||
Total loans | 46,316 | 49,543 |
Foreign | ||
Summary of loans, by loan type | ||
Total loans | $ 150,517 | $ 158,886 |
Allowance for Probable Loan L_3
Allowance for Probable Loan Losses (By Loan Class) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Allowance for probable loan losses | |||
Balance at the beginning of the period | $ 67,687 | $ 64,661 | $ 66,988 |
Losses charged to allowance | (15,125) | (13,098) | (35,901) |
Recoveries credited to allowance | 2,710 | 4,903 | 13,715 |
Net losses (recoveries) charged to allowance | (12,415) | (8,195) | (22,186) |
Provision charged to operations | 6,112 | 11,221 | 19,859 |
Balance at the end of the period | 61,384 | 67,687 | 64,661 |
Watch - List Impaired | |||
Allowance for probable loan losses | |||
Losses charged to allowance | (19,400) | ||
Commercial | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 27,905 | 25,649 | 21,431 |
Losses charged to allowance | (14,220) | (12,094) | (32,959) |
Recoveries credited to allowance | 1,981 | 4,020 | 7,110 |
Net losses (recoveries) charged to allowance | (12,239) | (8,074) | (25,849) |
Provision charged to operations | (3,070) | 10,330 | 30,067 |
Balance at the end of the period | 12,596 | 27,905 | 25,649 |
Commercial Real Estate:Other Construction and Land Development | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 11,675 | 13,889 | 13,920 |
Losses charged to allowance | (1) | (213) | (16) |
Recoveries credited to allowance | 25 | 21 | 6,099 |
Net losses (recoveries) charged to allowance | 24 | (192) | 6,083 |
Provision charged to operations | 3,424 | (2,022) | (6,114) |
Balance at the end of the period | 15,123 | 11,675 | 13,889 |
Commercial Real Estate: Farmland and Commercial | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 16,663 | 16,731 | 19,769 |
Losses charged to allowance | (70) | (40) | (1,890) |
Recoveries credited to allowance | 246 | 527 | 119 |
Net losses (recoveries) charged to allowance | 176 | 487 | (1,771) |
Provision charged to operations | 2,514 | (555) | (1,267) |
Balance at the end of the period | 19,353 | 16,663 | 16,731 |
Commercial Real Estate: Multifamily | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 1,109 | 806 | 1,248 |
Losses charged to allowance | (180) | ||
Net losses (recoveries) charged to allowance | (180) | ||
Provision charged to operations | 699 | 303 | (262) |
Balance at the end of the period | 1,808 | 1,109 | 806 |
Residential First Lien | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 2,950 | 2,455 | 3,509 |
Losses charged to allowance | (122) | (101) | (70) |
Recoveries credited to allowance | 36 | 11 | 21 |
Net losses (recoveries) charged to allowance | (86) | (90) | (49) |
Provision charged to operations | 603 | 585 | (1,005) |
Balance at the end of the period | 3,467 | 2,950 | 2,455 |
Residential Junior Lien | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 6,103 | 3,716 | 5,321 |
Losses charged to allowance | (347) | (340) | (331) |
Recoveries credited to allowance | 369 | 258 | 278 |
Net losses (recoveries) charged to allowance | 22 | (82) | (53) |
Provision charged to operations | 1,594 | 2,469 | (1,552) |
Balance at the end of the period | 7,719 | 6,103 | 3,716 |
Consumer | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 440 | 531 | 638 |
Losses charged to allowance | (362) | (309) | (414) |
Recoveries credited to allowance | 43 | 45 | 69 |
Net losses (recoveries) charged to allowance | (319) | (264) | (345) |
Provision charged to operations | 326 | 173 | 238 |
Balance at the end of the period | 447 | 440 | 531 |
Foreign | |||
Allowance for probable loan losses | |||
Balance at the beginning of the period | 842 | 884 | 1,152 |
Losses charged to allowance | (3) | (1) | (41) |
Recoveries credited to allowance | 10 | 21 | 19 |
Net losses (recoveries) charged to allowance | 7 | 20 | (22) |
Provision charged to operations | 22 | (62) | (246) |
Balance at the end of the period | $ 871 | $ 842 | $ 884 |
Allowance for Probable Loan L_4
Allowance for Probable Loan Losses (Impairment By Loan Class) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | $ 23,900 | $ 63,204 |
Loans Individually Evaluated for Impairment, Allowance | 772 | 434 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 6,537,389 | 6,284,968 |
Loans Collectively Evaluated for Impairment, Allowance | 60,612 | 67,253 |
Commercial | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 9,179 | 17,947 |
Loans Individually Evaluated for Impairment, Allowance | 656 | 300 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 1,119,790 | 1,068,520 |
Loans Collectively Evaluated for Impairment, Allowance | 11,940 | 27,605 |
Commercial Real Estate:Other Construction and Land Development | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 2,092 | 2,455 |
Loans Individually Evaluated for Impairment, Allowance | 116 | 116 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 1,884,139 | 1,681,095 |
Loans Collectively Evaluated for Impairment, Allowance | 15,007 | 11,559 |
Commercial Real Estate: Farmland and Commercial | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 3,509 | 33,123 |
Loans Individually Evaluated for Impairment, Allowance | 18 | |
Loans Collectively Evaluated for Impairment, Recorded Investment | 1,946,389 | 2,010,162 |
Loans Collectively Evaluated for Impairment, Allowance | 19,353 | 16,645 |
Commercial Real Estate: Multifamily | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 507 | 476 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 225,750 | 192,440 |
Loans Collectively Evaluated for Impairment, Allowance | 1,808 | 1,109 |
Residential First Lien | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 6,244 | 6,852 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 439,556 | 425,925 |
Loans Collectively Evaluated for Impairment, Allowance | 3,467 | 2,950 |
Residential Junior Lien | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 901 | 723 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 726,400 | 700,025 |
Loans Collectively Evaluated for Impairment, Allowance | 7,719 | 6,103 |
Consumer | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 1,175 | 1,281 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 45,141 | 48,262 |
Loans Collectively Evaluated for Impairment, Allowance | 447 | 440 |
Foreign | ||
Loan loss allowances, impaired financing receivable, evaluated individually or collectively | ||
Loans Individually Evaluated for Impairment, Recorded Investment | 293 | 347 |
Loans Collectively Evaluated for Impairment, Recorded Investment | 150,224 | 158,539 |
Loans Collectively Evaluated for Impairment, Allowance | $ 871 | $ 842 |
Allowance for Probable Loan L_5
Allowance for Probable Loan Losses (Non-accrual Basis By Loan Class) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | $ 15,791,000 | $ 54,730,000 | $ 37,245,000 |
Reduced interest income on non-accrual loans | 1,119,000 | 977,000 | $ 2,461,000 |
Commercial | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | 9,143,000 | 17,909,000 | |
Commercial Real Estate:Other Construction and Land Development | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | 2,092,000 | 2,455,000 | |
Commercial Real Estate: Farmland and Commercial | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | 3,509,000 | 33,123,000 | |
Commercial Real Estate: Multifamily | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | 507,000 | 476,000 | |
Residential First Lien | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | 347,000 | 712,000 | |
Residential Junior Lien | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | 171,000 | 11,000 | |
Consumer | |||
Loan loss allowances, financing receivable past due | |||
Non-accrual loans, total | $ 22,000 | $ 44,000 |
Allowance for Probable Loan L_6
Allowance for Probable Loan Losses (Impaired Loans) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Interest Recognized | ||
Total trouble debt restructuring | $ 8,158 | $ 15,346 |
Period of charge off for past due unsecured commercial loans | 90 days | |
Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with related allowance | $ 1,698 | 1,894 |
Total impaired loans with no related allowance | 22,202 | 61,310 |
Unpaid principal balance: | ||
Total impaired loans with an allowance recorded | 2,330 | 2,336 |
Total impaired loans with no related allowance recorded | 23,284 | 89,664 |
Related Allowance | 772 | 434 |
Average recorded investment: | ||
Total impaired loans with an allowance recorded | 1,882 | 1,985 |
Total impaired loans with no related allowance recorded | 65,192 | 72,417 |
Interest Recognized | ||
Total impaired loans with no related allowance recorded | 368 | 391 |
Commercial | ||
Interest Recognized | ||
Total trouble debt restructuring | 35 | 6,910 |
Commercial | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with related allowance | 1,563 | |
Total impaired loans with no related allowance | 7,616 | 16,646 |
Unpaid principal balance: | ||
Total impaired loans with an allowance recorded | 2,161 | |
Total impaired loans with no related allowance recorded | 7,730 | 44,095 |
Related Allowance | 656 | |
Average recorded investment: | ||
Total impaired loans with an allowance recorded | 1,741 | |
Total impaired loans with no related allowance recorded | 16,194 | 19,615 |
Interest Recognized | ||
Total impaired loans with no related allowance recorded | 3 | 3 |
Commercial Real Estate:Other Construction and Land Development | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with related allowance | 135 | 1,300 |
Total impaired loans with no related allowance | 1,957 | 2,310 |
Unpaid principal balance: | ||
Total impaired loans with an allowance recorded | 169 | 1,577 |
Total impaired loans with no related allowance recorded | 2,205 | 2,455 |
Related Allowance | 116 | 300 |
Average recorded investment: | ||
Total impaired loans with an allowance recorded | 141 | 1,346 |
Total impaired loans with no related allowance recorded | 2,151 | 3,493 |
Commercial Real Estate: Farmland and Commercial | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with related allowance | 145 | |
Total impaired loans with no related allowance | 3,509 | 32,675 |
Unpaid principal balance: | ||
Total impaired loans with an allowance recorded | 169 | |
Total impaired loans with no related allowance recorded | 4,031 | 33,275 |
Related Allowance | 116 | |
Average recorded investment: | ||
Total impaired loans with an allowance recorded | 150 | |
Total impaired loans with no related allowance recorded | 36,632 | 38,536 |
Commercial Real Estate: Multifamily | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with related allowance | 449 | |
Total impaired loans with no related allowance | 507 | 476 |
Unpaid principal balance: | ||
Total impaired loans with an allowance recorded | 590 | |
Total impaired loans with no related allowance recorded | 538 | 505 |
Related Allowance | 18 | |
Average recorded investment: | ||
Total impaired loans with an allowance recorded | 489 | |
Total impaired loans with no related allowance recorded | 565 | 511 |
Residential First Lien | ||
Interest Recognized | ||
Total trouble debt restructuring | 5,947 | 6,140 |
Residential First Lien | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with no related allowance | 6,244 | 6,852 |
Unpaid principal balance: | ||
Total impaired loans with no related allowance recorded | 6,386 | 6,968 |
Average recorded investment: | ||
Total impaired loans with no related allowance recorded | 7,136 | 7,249 |
Interest Recognized | ||
Total impaired loans with no related allowance recorded | 305 | 324 |
Residential Junior Lien | ||
Interest Recognized | ||
Total trouble debt restructuring | 730 | 712 |
Residential Junior Lien | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with no related allowance | 901 | 723 |
Unpaid principal balance: | ||
Total impaired loans with no related allowance recorded | 911 | 736 |
Average recorded investment: | ||
Total impaired loans with no related allowance recorded | 976 | 970 |
Interest Recognized | ||
Total impaired loans with no related allowance recorded | 44 | 45 |
Consumer | ||
Interest Recognized | ||
Total trouble debt restructuring | 1,153 | 1,237 |
Consumer | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with no related allowance | 1,175 | 1,281 |
Unpaid principal balance: | ||
Total impaired loans with no related allowance recorded | 1,190 | 1,283 |
Average recorded investment: | ||
Total impaired loans with no related allowance recorded | 1,211 | 1,293 |
Interest Recognized | ||
Total impaired loans with no related allowance recorded | 2 | 3 |
Foreign | ||
Interest Recognized | ||
Total trouble debt restructuring | 293 | 347 |
Foreign | Class of Financing Receivable | ||
Recorded investment: | ||
Total impaired loans with no related allowance | 293 | 347 |
Unpaid principal balance: | ||
Total impaired loans with no related allowance recorded | 293 | 347 |
Average recorded investment: | ||
Total impaired loans with no related allowance recorded | 327 | 750 |
Interest Recognized | ||
Total impaired loans with no related allowance recorded | $ 14 | $ 16 |
Allowance for Probable Loan L_7
Allowance for Probable Loan Losses (Aging By Loan Class) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | $ 40,674,000 | $ 7,257,000 | $ 5,226,000 |
Past due | 75,833,000 | 77,053,000 | |
Loans, current | 6,485,456,000 | 6,271,119,000 | |
Total loans | 6,561,289,000 | 6,348,172,000 | |
30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 15,978,000 | 15,855,000 | |
60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 6,011,000 | 4,429,000 | |
90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 53,844,000 | 56,769,000 | |
Commercial | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 10,890,000 | 537,000 | |
Past due | 25,591,000 | 22,496,000 | |
Loans, current | 1,103,378,000 | 1,063,971,000 | |
Total loans | 1,128,969,000 | 1,086,467,000 | |
Commercial | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 4,651,000 | 3,790,000 | |
Commercial | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 1,089,000 | 398,000 | |
Commercial | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 19,851,000 | 18,308,000 | |
Commercial Real Estate:Other Construction and Land Development | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 16,000 | 6,000 | |
Past due | 3,356,000 | 1,482,000 | |
Loans, current | 1,882,875,000 | 1,682,068,000 | |
Total loans | 1,886,231,000 | 1,683,550,000 | |
Commercial Real Estate:Other Construction and Land Development | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 727,000 | 354,000 | |
Commercial Real Estate:Other Construction and Land Development | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 1,707,000 | 308,000 | |
Commercial Real Estate:Other Construction and Land Development | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 922,000 | 820,000 | |
Commercial Real Estate: Farmland and Commercial | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 24,910,000 | 954,000 | |
Past due | 30,951,000 | 35,576,000 | |
Loans, current | 1,918,947,000 | 2,007,709,000 | |
Total loans | 1,949,898,000 | 2,043,285,000 | |
Commercial Real Estate: Farmland and Commercial | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 2,928,000 | 3,925,000 | |
Commercial Real Estate: Farmland and Commercial | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 784,000 | 518,000 | |
Commercial Real Estate: Farmland and Commercial | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 27,239,000 | 31,133,000 | |
Commercial Real Estate: Multifamily | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 71,000 | ||
Past due | 1,505,000 | 560,000 | |
Loans, current | 224,752,000 | 192,356,000 | |
Total loans | 226,257,000 | 192,916,000 | |
Commercial Real Estate: Multifamily | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 927,000 | 84,000 | |
Commercial Real Estate: Multifamily | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 578,000 | 476,000 | |
Residential First Lien | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 3,079,000 | 3,861,000 | |
Past due | 9,037,000 | 10,848,000 | |
Loans, current | 436,763,000 | 421,929,000 | |
Total loans | 445,800,000 | 432,777,000 | |
Residential First Lien | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 3,998,000 | 4,295,000 | |
Residential First Lien | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 1,677,000 | 2,458,000 | |
Residential First Lien | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 3,362,000 | 4,095,000 | |
Residential Junior Lien | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 937,000 | 1,099,000 | |
Past due | 2,881,000 | 3,000,000 | |
Loans, current | 724,420,000 | 697,748,000 | |
Total loans | 727,301,000 | 700,748,000 | |
Residential Junior Lien | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 1,155,000 | 1,310,000 | |
Residential Junior Lien | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 618,000 | 580,000 | |
Residential Junior Lien | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 1,108,000 | 1,110,000 | |
Consumer | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 32,000 | 133,000 | |
Past due | 550,000 | 1,126,000 | |
Loans, current | 45,766,000 | 48,417,000 | |
Total loans | 46,316,000 | 49,543,000 | |
Consumer | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 486,000 | 868,000 | |
Consumer | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 19,000 | 98,000 | |
Consumer | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | 45,000 | 160,000 | |
Foreign | |||
Financing receivable recorded investment | |||
Past due 90 days or Greater and Still Accruing | 739,000 | 667,000 | |
Past due | 1,962,000 | 1,965,000 | |
Loans, current | 148,555,000 | 156,921,000 | |
Total loans | 150,517,000 | 158,886,000 | |
Foreign | 30 to 59 Days | |||
Financing receivable recorded investment | |||
Past due | 1,106,000 | 1,229,000 | |
Foreign | 60 to 89 Days | |||
Financing receivable recorded investment | |||
Past due | 117,000 | 69,000 | |
Foreign | 90 Days or Greater | |||
Financing receivable recorded investment | |||
Past due | $ 739,000 | $ 667,000 |
Allowance for Probable Loan L_8
Allowance for Probable Loan Losses (Portfolio Credit Quality By Loan Class) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Loan portfolio by credit quality indicator | ||
Portfolio, total | $ 6,561,289 | $ 6,348,172 |
Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 6,126,933 | 5,911,001 |
Special Review | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 64,135 | 6,612 |
Watch List - Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 92,976 | 45,662 |
Watch List - Substandard | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 253,345 | 321,693 |
Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 23,900 | 63,204 |
Commercial | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,128,969 | 1,086,467 |
Commercial | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 998,625 | 905,707 |
Commercial | Special Review | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 441 | |
Commercial | Watch List - Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 44,544 | 3,170 |
Commercial | Watch List - Substandard | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 76,180 | 159,643 |
Commercial | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 9,179 | 17,947 |
Commercial Real Estate:Other Construction and Land Development | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,886,231 | 1,683,550 |
Commercial Real Estate:Other Construction and Land Development | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,817,098 | 1,616,604 |
Commercial Real Estate:Other Construction and Land Development | Special Review | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,648 | 1,288 |
Commercial Real Estate:Other Construction and Land Development | Watch List - Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 9,055 | 672 |
Commercial Real Estate:Other Construction and Land Development | Watch List - Substandard | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 56,338 | 62,531 |
Commercial Real Estate:Other Construction and Land Development | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 2,092 | 2,455 |
Commercial Real Estate: Farmland and Commercial | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,949,898 | 2,043,285 |
Commercial Real Estate: Farmland and Commercial | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,726,711 | 1,863,763 |
Commercial Real Estate: Farmland and Commercial | Special Review | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 62,046 | 5,134 |
Commercial Real Estate: Farmland and Commercial | Watch List - Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 38,373 | 41,820 |
Commercial Real Estate: Farmland and Commercial | Watch List - Substandard | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 119,259 | 99,445 |
Commercial Real Estate: Farmland and Commercial | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 3,509 | 33,123 |
Commercial Real Estate: Multifamily | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 226,257 | 192,916 |
Commercial Real Estate: Multifamily | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 224,823 | 192,440 |
Commercial Real Estate: Multifamily | Watch List - Substandard | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 927 | |
Commercial Real Estate: Multifamily | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 507 | 476 |
Residential First Lien | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 445,800 | 432,777 |
Residential First Lien | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 438,773 | 425,811 |
Residential First Lien | Special Review | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 40 | |
Residential First Lien | Watch List - Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 142 | |
Residential First Lien | Watch List - Substandard | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 641 | 74 |
Residential First Lien | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 6,244 | 6,852 |
Residential Junior Lien | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 727,301 | 700,748 |
Residential Junior Lien | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 725,538 | 699,875 |
Residential Junior Lien | Special Review | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 150 | |
Residential Junior Lien | Watch List - Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 862 | |
Residential Junior Lien | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 901 | 723 |
Consumer | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 46,316 | 49,543 |
Consumer | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 45,141 | 48,262 |
Consumer | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 1,175 | 1,281 |
Foreign | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 150,517 | 158,886 |
Foreign | Pass | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | 150,224 | 158,539 |
Foreign | Watch - List Impaired | ||
Loan portfolio by credit quality indicator | ||
Portfolio, total | $ 293 | $ 347 |
Bank Premises and Equipment (De
Bank Premises and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Bank premises and equipment | ||
Less: accumulated depreciation | $ (468,167) | $ (448,470) |
Bank premises and equipment, net | 506,899 | 514,454 |
Bank Building and Improvements | ||
Bank premises and equipment | ||
Bank premises and equipment, gross | $ 563,302 | 550,094 |
Bank Building and Improvements | Minimum | ||
Bank premises and equipment | ||
Estimated useful lives | 5 years | |
Bank Building and Improvements | Maximum | ||
Bank premises and equipment | ||
Estimated useful lives | 40 years | |
Furniture, Equipment and Vehicles | ||
Bank premises and equipment | ||
Bank premises and equipment, gross | $ 292,958 | 289,743 |
Furniture, Equipment and Vehicles | Minimum | ||
Bank premises and equipment | ||
Estimated useful lives | 1 year | |
Furniture, Equipment and Vehicles | Maximum | ||
Bank premises and equipment | ||
Estimated useful lives | 20 years | |
Land | ||
Bank premises and equipment | ||
Bank premises and equipment, gross | $ 118,806 | $ 123,087 |
Land, Building, Furniture, Fixture and Equipment | Minimum | ||
Bank premises and equipment | ||
Estimated useful lives | 7 years | |
Land, Building, Furniture, Fixture and Equipment | Maximum | ||
Bank premises and equipment | ||
Estimated useful lives | 27 years |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Identified intangible assets | |||
Carrying Amount | $ 60,697 | $ 60,697 | |
Accumulated Amortization | 60,697 | 60,697 | |
Amortization expense | 25 | $ 128 | |
Changes in carrying amount of goodwill | 0 | 0 | |
Core deposit premium | |||
Identified intangible assets | |||
Carrying Amount | 58,675 | 58,675 | |
Accumulated Amortization | 58,675 | 58,675 | |
Identified intangible (contract rights) | |||
Identified intangible assets | |||
Carrying Amount | 2,022 | 2,022 | |
Accumulated Amortization | $ 2,022 | $ 2,022 |
Deposits (Details)
Deposits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Demand non-interest bearing | |||
Domestic | $ 2,758,768 | $ 2,609,932 | |
Foreign | 696,072 | 633,323 | |
Total demand non-interest bearing | 3,454,840 | 3,243,255 | |
Savings and interest bearing demand | |||
Domestic | 2,531,854 | 2,615,143 | |
Foreign | 736,383 | 629,988 | |
Total savings and interest bearing demand | 3,268,237 | 3,245,131 | |
$100,000 or more | |||
Time, certificate of deposit | 1,398,381 | ||
Less than $100,000 | |||
Domestic | 323,377 | 354,998 | |
Foreign | 251,710 | 255,621 | |
Total time, certificates of deposit | 1,973,468 | 2,056,506 | |
Total deposits | 8,696,545 | 8,544,892 | |
Savings and interest bearing demand | |||
Domestic | 11,029 | 5,453 | $ 3,922 |
Foreign | 1,735 | 755 | 640 |
Total savings and interest bearing demand | 12,764 | 6,208 | 4,562 |
$100,000 or more | |||
Domestic | 4,741 | 3,644 | 3,881 |
Foreign | 5,798 | 4,105 | 3,929 |
Less than $100,000 | |||
Domestic | 1,589 | 1,312 | 1,447 |
Foreign | 968 | 675 | 706 |
Total time, certificates of deposit | 13,096 | 9,736 | 9,963 |
Total interest expense on deposits | 25,860 | 15,944 | $ 14,525 |
Domestic | |||
$100,000 or more | |||
Time, certificate of deposit | 590,895 | 637,006 | |
Foreign | |||
$100,000 or more | |||
Time, certificate of deposit | $ 807,486 | $ 808,881 |
Deposits (Scheduled Maturities)
Deposits (Scheduled Maturities) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Scheduled maturities of time deposits | ||
2,019 | $ 1,786,776 | |
2,020 | 138,105 | |
2,021 | 31,665 | |
2,022 | 15,717 | |
2,023 | 1,096 | |
Thereafter | 109 | |
Total time, certificates of deposit | 1,973,468 | $ 2,056,506 |
Time Deposits 250,000 or exceed | 869,000 | $ 894,000 |
Scheduled maturities of time deposits in amounts of $100,000 or more | ||
Due within 3 months or less | 500,836 | |
Due after 3 months and within 6 months | 337,349 | |
Due after 6 months and within 12 months | 433,628 | |
Due after 12 months | 126,568 | |
Total | $ 1,398,381 |
Securities Sold Under Repurch_3
Securities Sold Under Repurchase Agreements (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Collateral Securities and Repurchase Borrowing agreements | ||
Average outstanding amount | $ 314,876,000 | $ 402,396,000 |
Maximum amount outstanding at any month end | 370,495,000 | 514,616,000 |
Collateralized Securities, Book Value of Securities Sold | 369,086,000 | 460,681,000 |
Collateralized securities, Fair Value of Securities Sold | 360,177,000 | 452,912,000 |
Repurchase Borrowing, Balance of Liability | $ 229,989,000 | $ 353,805,000 |
Repurchase Borrowing, Weighted Average Interest Rate (as a percent) | 0.87% | 1.32% |
Overnight agreements | ||
Collateral Securities and Repurchase Borrowing agreements | ||
Collateralized Securities, Book Value of Securities Sold | $ 357,642,000 | $ 340,054,000 |
Collateralized securities, Fair Value of Securities Sold | 349,081,000 | 334,506,000 |
Repurchase Borrowing, Balance of Liability | $ 218,852,000 | $ 242,824,000 |
Repurchase Borrowing, Weighted Average Interest Rate (as a percent) | 0.85% | 0.25% |
30 to 90 days | ||
Collateral Securities and Repurchase Borrowing agreements | ||
Collateralized Securities, Book Value of Securities Sold | $ 109,300,000 | |
Collateralized securities, Fair Value of Securities Sold | 107,238,000 | |
Repurchase Borrowing, Balance of Liability | $ 100,000,000 | |
Repurchase Borrowing, Weighted Average Interest Rate (as a percent) | 3.99% | |
Over 90 days | ||
Collateral Securities and Repurchase Borrowing agreements | ||
Collateralized Securities, Book Value of Securities Sold | $ 11,444,000 | $ 11,327,000 |
Collateralized securities, Fair Value of Securities Sold | 11,096,000 | 11,168,000 |
Repurchase Borrowing, Balance of Liability | $ 11,137,000 | $ 10,981,000 |
Repurchase Borrowing, Weighted Average Interest Rate (as a percent) | 1.27% | 0.74% |
Other Borrowed Funds (Details)
Other Borrowed Funds (Details) | 12 Months Ended | |
Dec. 31, 2018USD ($)loan | Dec. 31, 2017USD ($) | |
Federal Home Loan Bank advances | ||
Other borrowed funds | $ 705,665,000 | $ 1,195,225,000 |
Federal home loan bank advances maturing November 2027 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | 100,000,000 | |
Federal home loan Bank advances maturing December 2027 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | 150,000,000 | |
Federal Home Loan Bank advances - short-term | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | $ 268,975,000 | $ 945,225,000 |
Rate on balance outstanding at year end (as a percent) | 2.70% | 1.44% |
Average daily balance | $ 621,357,000 | $ 839,858,000 |
Average rate (as a percent) | 1.97% | 1.23% |
Maximum amount outstanding at any month end | $ 1,007,100,000 | $ 1,043,250,000 |
Federal Home Loan Bank advances - long-term | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | $ 436,690,000 | $ 250,000,000 |
Rate on balance outstanding at year end (as a percent) | 1.73% | 1.26% |
Average daily balance | $ 302,373,000 | $ 51,644,000 |
Average rate (as a percent) | 1.71% | 1.26% |
Maximum amount outstanding at any month end | $ 436,700,000 | $ 250,000,000 |
Federal Home Loan Bank advances - long-term | Federal Home Loan Bank advances maturing July 2028 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | 75,000,000,000 | |
Federal Home Loan Bank advances - long-term | Federal Home Loan Bank advances maturing March 2033 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | 100,000,000,000 | |
Federal Home Loan Bank advances - long-term | Federal Home Loan Bank advances maturing August 2033 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | $ 250,000,000,000 | |
Federal Home Loan Bank advances - long-term | Federal Home Loan Bank amortizing advances | ||
Federal Home Loan Bank advances | ||
Number of amortizing advances | loan | 2 | |
Amortizing in 2019 | $ 179,000,000 | |
Amortizing in 2020 | 179,000,000 | |
Amortizing in 2021 | 179,000,000 | |
Amortizing in 2022 | 179,000,000 | |
Amortizing in 2023 | 179,000,000 | |
Federal Home Loan Bank advances - long-term | Federal Home Loan Bank advances maturing December 2033 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | 3,200,000,000 | |
Federal Home Loan Bank advances - long-term | Federal Home Loan Bank advances maturing November 2033 | ||
Federal Home Loan Bank advances | ||
Other borrowed funds | $ 8,490,000,000 |
Junior Subordinated Deferrable
Junior Subordinated Deferrable Interest Debentures (Details) | 12 Months Ended | |
Dec. 31, 2018USD ($)item | Dec. 31, 2017USD ($) | |
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Number of statutory business trusts issuing trust preferred securities | item | 6 | |
Junior subordinated deferrable interest debentures | $ 160,416,000 | $ 160,416,000 |
Maximum number of consecutive quarterly period available for deferral of interest payment on Trusts VI, VIII, IX, X, XI and XII | item | 20 | |
Percentage of capital securities issued by trust qualifying as Tier I capital, maximum | 25.00% | |
Percentage of capital securities issued by trust qualifying as Tier II capital, minimum | 25.00% | |
Capital securities issued by the trust, qualifying as Tier I capital | $ 160,416,000 | $ 160,416,000 |
Trust XI | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | 25,990,000 | |
Trust X | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 21,021,000 |
Junior Subordinated Deferrabl_2
Junior Subordinated Deferrable Interest Debentures (Key Information) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 160,416,000 | $ 160,416,000 |
Trust VI | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 25,774,000 | |
Interest rate (as a percent) | 6.07% | |
Interest rate index | LIBOR | |
Spread on interest rate index (as a percent) | 3.45% | |
Trust VIII | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 25,774,000 | |
Interest rate (as a percent) | 5.49% | |
Interest rate index | LIBOR | |
Spread on interest rate index (as a percent) | 3.05% | |
Trust IX | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 41,238,000 | |
Interest rate (as a percent) | 4.02% | |
Interest rate index | LIBOR | |
Spread on interest rate index (as a percent) | 1.62% | |
Trust X | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 21,021,000 | |
Interest rate (as a percent) | 4.19% | |
Interest rate index | LIBOR | |
Spread on interest rate index (as a percent) | 1.65% | |
Trust XI | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 25,990,000 | |
Interest rate (as a percent) | 4.02% | |
Interest rate index | LIBOR | |
Spread on interest rate index (as a percent) | 1.62% | |
Trust XII | ||
Junior subordinated deferrable interest debentures, major types of business trusts | ||
Junior subordinated deferrable interest debentures | $ 20,619,000 | |
Interest rate (as a percent) | 4.19% | |
Interest rate index | LIBOR | |
Spread on interest rate index (as a percent) | 1.45% |
Earnings per Share ("EPS") (Det
Earnings per Share ("EPS") (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Basic EPS | |||
Net income | $ 215,931 | $ 157,436 | $ 133,932 |
Shares (Denominator) | 66,106,580 | 66,046,155 | 65,967,989 |
Per Share Amount | $ 3.27 | $ 2.38 | $ 2.03 |
Diluted EPS | |||
Net Income | $ 215,931 | $ 157,436 | $ 133,932 |
Potential dilutive common shares and warrants | 527,240 | 732,281 | 345,501 |
Shares (Denominator) | 66,633,820 | 66,778,436 | 66,313,490 |
Per Share Amount (in dollars per share) | $ 3.24 | $ 2.36 | $ 2.02 |
Employees' Profit Sharing Plan
Employees' Profit Sharing Plan (Details) - Deferred profit sharing plan - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Employees' profit sharing plan | |||
Minimum period of continuous employment to be fully vested | 1 year | ||
Profit sharing costs | $ 3,850,000 | $ 3,750,000 | $ 3,650,000 |
International Operations (Detai
International Operations (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Loans: | ||||
Loans | $ 6,561,289,000 | $ 6,348,172,000 | ||
Less allowance for probable loan losses | (61,384,000) | (67,687,000) | $ (64,661,000) | $ (66,988,000) |
Net loans | 6,499,905,000 | 6,280,485,000 | ||
Accrued interest receivable | 36,803,000 | 34,456,000 | ||
International Banking Services | ||||
Loans: | ||||
Accrued interest receivable | 811,000 | 671,000 | ||
Outstanding standby and commercial letters of credit | 119,302,000 | |||
Revenues | 5,412,000 | 5,248,000 | $ 5,495,000 | |
International Banking Services | Foreign | ||||
Loans: | ||||
Loans | 150,517,000 | 158,886,000 | ||
Less allowance for probable loan losses | (871,000) | (842,000) | ||
Net loans | 149,646,000 | 158,044,000 | ||
International Banking Services | Foreign | Commercial | ||||
Loans: | ||||
Loans | 101,955,000 | 113,019,000 | ||
International Banking Services | Foreign | Others | ||||
Loans: | ||||
Loans | $ 48,562,000 | $ 45,867,000 |
Income Taxes (Current and Defer
Income Taxes (Current and Deferred Portions of Net Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current | |||
U.S. | $ 48,144 | $ 56,974 | $ 52,403 |
State | 3,370 | 2,662 | 3,362 |
Foreign | (5) | ||
Total current taxes | 51,509 | 59,636 | 55,765 |
Deferred | |||
U.S. | 5,130 | 4,620 | 7,279 |
State | 13 | (50) | 27 |
Total deferred taxes | 5,143 | 4,570 | 7,306 |
Total income taxes | $ 56,652 | $ 64,206 | $ 63,071 |
Income Taxes (Income Tax Expens
Income Taxes (Income Tax Expense Differences from the Amount Computed by Applying the U.S. Federal Income Tax Rate) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Taxes | |||
U.S. Federal income tax rate (as a percent) | 21.00% | 35.00% | 35.00% |
Reasons for the difference of income tax expense | |||
Computed expected tax expense | $ 57,831 | $ 77,643 | $ 69,253 |
Change in taxes resulting from: | |||
Tax-exempt interest income | (3,101) | (4,701) | (3,940) |
State tax, net of federal income taxes and tax credit and refunds | 2,673 | 1,697 | 3,287 |
Resolution of IRS exam | (4,985) | ||
Other investment income | (1,561) | (3,198) | (3,694) |
Deferred tax adjustment due to federal tax rate change | (1,618) | (3,168) | |
Net investment expense, low income housing investment | 2,518 | 387 | |
Other | (90) | 531 | (1,835) |
Total income taxes | $ 56,652 | $ 64,206 | $ 63,071 |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets and Deferred Tax Liabilities) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred tax assets: | |||
Loans receivable, principally due to the allowance for probable loan losses | $ 12,257,000 | $ 14,546,000 | |
Other real estate owned | 2,459,000 | 2,053,000 | |
Impairment charges on available-for-sale securities | 1,054,000 | 844,000 | |
Accrued expenses | 81,000 | 81,000 | |
Net unrealized losses on available for sale investment securities | 15,182,000 | 9,680,000 | |
Other | 5,076,000 | 4,434,000 | |
Total deferred tax assets | 36,109,000 | 31,638,000 | |
Deferred tax liabilities: | |||
Bank premises and equipment, principally due to differences on depreciation | (12,596,000) | (10,940,000) | |
Identified intangible assets and goodwill | (13,490,000) | (13,417,000) | |
Other | (14,787,000) | (12,474,000) | |
Total deferred tax liabilities | 40,873,000 | 36,831,000 | |
Net deferred tax liability | $ (4,764,000) | $ (5,193,000) | |
U.S. Federal income tax rate (as a percent) | 21.00% | 35.00% | 35.00% |
Net benefit due to change in tax rate | $ 4,786,000 |
Stock Options (Details)
Stock Options (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Apr. 05, 2012 | |
Stock options under 2012 Plan | ||||
Stock option details | ||||
Shares available for future grants | 10,700 | 800,000 | ||
Maximum exercisable period for options granted | 10 years | |||
Black-Scholes-Merton option valuation model assumptions | ||||
Expected Life (Years) | 7 years | |||
Dividend yield (as a percent) | 1.73% | |||
Interest rate (as a percent) | 2.68% | |||
Volatility (as a percent) | 31.65% | |||
Number of options granted (in shares) | 234,700 | 0 | ||
Stock option activity | ||||
Options outstanding at the beginning of the period (in shares) | 668,166 | |||
Plus: Options granted (in shares) | 234,700 | 0 | ||
Less: | ||||
Options exercised (in shares) | 84,701 | |||
Options forfeited (in shares) | 29,188 | |||
Options outstanding at the end of the period (in shares) | 788,977 | 668,166 | ||
Options fully vested and exercisable at the end of the period (in shares) | 310,108 | |||
Stock Options, Weighted average exercise price | ||||
Options outstanding at the beginning, weighted average exercise price (in dollars per share) | $ 20.41 | |||
Plus: Options granted, weighted average exercise price (in dollars per share) | 38.27 | |||
Less: | ||||
Options exercised, weighted average exercise price (in dollars per share) | 17.89 | |||
Options forfeited, weighted average exercise price (in dollars per share) | 22.73 | |||
Options outstanding at the end, weighted average exercise price (in dollars per share) | 25.91 | $ 20.41 | ||
Options fully vested and exercisable at the end, weighted average exercise price (in dollars per share) | $ 19.93 | |||
Stock Options, Weighted average remaining contractual term (years) | ||||
Options outstanding at the end, weighted average remaining contractual term (years) | 6 years 26 days | |||
Options fully vested and exercisable at the end, weighted average remaining contractual term (years) | 4 years 2 months 16 days | |||
Stock Options, Aggregate intrinsic value | ||||
Options outstanding at the end, aggregate intrinsic value | $ 7,587,000 | |||
Options fully vested and exercisable at the end, aggregate intrinsic value | 4,486,000 | |||
Stock-based compensation expense | 1,035,000 | $ 903,000 | $ 1,082,000 | |
Stock-based compensation cost, unrecognized, related to non-vested options | $ 2,798,000 | |||
Stock-based compensation cost, unrecognized, related to non-vested options, weighted-average period of recognition | 2 years 1 month 6 days | |||
Other information pertaining to option activity | ||||
Weighted average grant date fair value of stock options granted (in dollars per share) | $ 11.78 | $ 8.74 | ||
Total fair value of stock options vested | $ 1,077,000 | 1,182,000 | $ 1,015,000 | |
Total intrinsic value of stock options exercised | $ 2,045,000 | $ 2,595,000 | $ 792,000 | |
Incentive stock options granted to 10% shareholders | ||||
Stock option details | ||||
Maximum exercisable period for options granted | 5 years |
Long Term Restricted Stock Un_2
Long Term Restricted Stock Units (Details) - Plan - RSUs | 12 Months Ended |
Dec. 31, 2018shares | |
Long-Term Restricted Stock Units | |
Granted units | 0 |
Outstanding grants (in shares) | 0 |
Commitments, Contingent Liabi_3
Commitments, Contingent Liabilities and Other Tax Matters (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Commitments, Contingent Liabilities and Other Tax Matters | |||
Total rental expense | $ 5,257,000 | $ 5,258,000 | $ 5,870,000 |
Minimum period for non-cancellable sub-leases | 1 year | ||
Aggregate future minimum rentals to be received under non-cancellable sub-leases | $ 82,690,000 | ||
Approximate cash maintained to satisfy regulatory reserve requirements | 115,721,000 | $ 116,129,000 | |
Future minimum lease payments due under non-cancellable operating leases | |||
2,019 | 3,443,000 | ||
2,020 | 3,246,000 | ||
2,021 | 2,272,000 | ||
2,022 | 579,000 | ||
2,023 | 212,000 | ||
Thereafter | 275,000 | ||
Total | $ 10,027,000 |
Transactions with Related Par_2
Transactions with Related Parties (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Transactions with Related Parties | ||
Aggregate amount receivable from related parties | $ 33,042,000 | $ 27,626,000 |
Financial Instruments with Of_3
Financial Instruments with Off-Statement of Condition Risk and Concentrations of Credit Risk (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Maximum | ||
Financial amounts of instruments, whose contract amounts represent credit risks | ||
Credit risk commitment, maximum expiration date | 1 year | |
Commitments to extend credit | ||
Financial amounts of instruments, whose contract amounts represent credit risks | ||
Outstanding amount of financial instruments whose, contract amounts represent credit risks | $ 2,935,768,000 | |
Credit card lines | ||
Financial amounts of instruments, whose contract amounts represent credit risks | ||
Outstanding amount of financial instruments whose, contract amounts represent credit risks | 21,114,000 | |
Standby letters of credit | ||
Financial amounts of instruments, whose contract amounts represent credit risks | ||
Outstanding amount of financial instruments whose, contract amounts represent credit risks | 111,229,000 | |
Guarantee obligations, maximum exposure | 111,229,000 | |
Commercial letters of credit | ||
Financial amounts of instruments, whose contract amounts represent credit risks | ||
Outstanding amount of financial instruments whose, contract amounts represent credit risks | 8,073,000 | |
Unsecured letters of credit | ||
Financial amounts of instruments, whose contract amounts represent credit risks | ||
Unsecured letters of credit | $ 42,729,000 | $ 35,409,000 |
Capital Requirements (Details)
Capital Requirements (Details) - USD ($) | Sep. 19, 2018 | Dec. 23, 2008 | Dec. 31, 2018 |
Capital Requirements | |||
Warrants to purchase entity's common stock (in shares) | 1,326,238 | ||
Warrants, exercise price (in dollars per share) | $ 24.43 | ||
Warrants, term | 10 years | ||
Maximum cash dividend paid in semi-annual period (in dollars per share) | $ 0.33 | ||
Payments for repurchase of warrants | $ 29,005,000 | $ 29,005,000 | |
Dividend payable by subsidiaries, maximum | $ 768,900,000 |
Capital Requirements (Changes)
Capital Requirements (Changes) (Details) - USD ($) $ in Billions | Dec. 31, 2018 | Jun. 30, 2018 | May 24, 2018 | Dec. 31, 2016 | Jan. 01, 2016 | Jul. 31, 2013 |
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 2.50% | 0.625% | ||||
Maximum amount of assets to exempt banks | $ 10 | |||||
Maximum amount of assets for qualified bank holding companies | $ 3 | $ 1 | ||||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 6.00% | |||||
Minimum | ||||||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 4.50% | |||||
Community bank leverage ratio | 8.00% | 4.00% | ||||
CET 1 ratio | 7.00% | |||||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 4.00% | |||||
Maximum | ||||||
Community bank leverage ratio | 10.00% |
Capital Requirements (Capital A
Capital Requirements (Capital Amounts and Ratios) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2016 | Jul. 31, 2013 |
Capital Requirements | |||||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 2.50% | 0.625% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 6.00% | ||||
Minimum | |||||
Capital Requirements | |||||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 4.50% | ||||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 4.00% | ||||
Parent Company | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Amount | $ 1,711,682 | $ 1,584,665 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 17.55% | 17.11% | |||
Total Capital (to Risk Weighted Assets), Actual Amount | $ 1,925,905 | $ 1,807,107 | |||
Tier 1 Capital (to Risk Weighted Assets), Actual Amount | 1,859,536 | 1,734,595 | |||
Tier 1 Capital (to Average Assets), Actual Amount | $ 1,859,536 | $ 1,734,595 | |||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 19.74% | 19.51% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 19.06% | 18.73% | |||
Tier 1 capital (to Average Assets), Actual Ratio (as a percent) | 15.87% | 14.62% | |||
Parent Company | Minimum | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 621,850 | $ 532,579 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 6.375% | 5.75% | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 963,258 | $ 856,757 | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | 768,168 | 671,512 | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Amount | $ 468,593 | $ 474,675 | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 9.875% | 9.25% | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 7.875% | 7.25% | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Ratio (as a percent) | 4.00% | 4.00% | |||
International Bank of Commerce, Laredo | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Amount | $ 1,201,462 | $ 1,119,173 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 17.24% | 17.10% | |||
Total Capital (to Risk Weighted Assets), Actual Amount | $ 1,248,107 | $ 1,173,068 | |||
Tier 1 Capital (to Risk Weighted Assets), Actual Amount | 1,201,462 | 1,119,173 | |||
Tier 1 Capital (to Average Assets), Actual Amount | $ 1,201,462 | $ 1,119,173 | |||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 17.91% | 17.93% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 17.24% | 17.10% | |||
Tier 1 capital (to Average Assets), Actual Ratio (as a percent) | 14.45% | 13.44% | |||
International Bank of Commerce, Laredo | Minimum | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 444,207 | $ 376,245 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 452,917 | $ 425,320 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 6.375% | 5.75% | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 6.50% | 6.50% | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 688,086 | $ 605,263 | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 696,796 | 654,339 | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | 548,727 | 474,395 | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 557,437 | 523,471 | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Amount | 332,507 | 333,166 | |||
Tier 1 Capital (to Average Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 415,634 | $ 416,458 | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 9.875% | 9.25% | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 10.00% | 10.00% | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 7.875% | 7.25% | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 8.00% | 8.00% | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Ratio (as a percent) | 4.00% | 4.00% | |||
Tier 1 Capital (to Average Assets), To Be well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 5.00% | 5.00% | |||
International Bank Of Commerce Oklahoma | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Amount | $ 188,997 | $ 169,279 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 13.95% | 13.41% | |||
Total Capital (to Risk Weighted Assets), Actual Amount | $ 198,293 | $ 178,057 | |||
Tier 1 Capital (to Risk Weighted Assets), Actual Amount | 188,997 | 169,279 | |||
Tier 1 Capital (to Average Assets), Actual Amount | $ 188,997 | $ 169,279 | |||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 14.64% | 14.11% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 13.95% | 13.41% | |||
Tier 1 capital (to Average Assets), Actual Ratio (as a percent) | 12.53% | 11.31% | |||
International Bank Of Commerce Oklahoma | Minimum | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 86,344 | $ 72,586 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 88,037 | $ 82,054 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 6.375% | 5.75% | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 6.50% | 6.50% | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 133,749 | $ 116,769 | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 135,442 | 126,237 | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | 106,660 | 91,521 | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 108,354 | 100,989 | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Amount | 60,344 | 59,854 | |||
Tier 1 Capital (to Average Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 75,430 | $ 74,818 | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 9.875% | 9.25% | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 10.00% | 10.00% | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 7.875% | 7.25% | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 8.00% | 8.00% | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Ratio (as a percent) | 4.00% | 4.00% | |||
Tier 1 Capital (to Average Assets), To Be well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 5.00% | 5.00% | |||
International Bank of Commerce, Brownsville | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Amount | $ 177,456 | $ 165,034 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 24.73% | 25.94% | |||
Total Capital (to Risk Weighted Assets), Actual Amount | $ 183,554 | $ 170,613 | |||
Tier 1 Capital (to Risk Weighted Assets), Actual Amount | 177,456 | 165,034 | |||
Tier 1 Capital (to Average Assets), Actual Amount | $ 177,456 | $ 165,034 | |||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 25.58% | 26.82% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 24.73% | 25.94% | |||
Tier 1 capital (to Average Assets), Actual Ratio (as a percent) | 17.25% | 17.17% | |||
International Bank of Commerce, Brownsville | Minimum | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 45,741 | $ 36,583 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 46,638 | $ 41,355 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 6.375% | 5.75% | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 6.50% | 6.50% | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 70,854 | $ 58,851 | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 71,750 | 63,623 | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | 56,503 | 46,127 | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 57,400 | 50,899 | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Amount | 41,144 | 38,440 | |||
Tier 1 Capital (to Average Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 51,430 | $ 48,050 | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 9.875% | 9.25% | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 10.00% | 10.00% | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 7.875% | 7.25% | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 8.00% | 8.00% | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Ratio (as a percent) | 4.00% | 4.00% | |||
Tier 1 Capital (to Average Assets), To Be well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 5.00% | 5.00% | |||
International Bank of Commerce, Zapata | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Amount | $ 70,984 | $ 66,406 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 30.77% | 30.58% | |||
Total Capital (to Risk Weighted Assets), Actual Amount | $ 73,726 | $ 68,718 | |||
Tier 1 Capital (to Risk Weighted Assets), Actual Amount | 70,984 | 66,406 | |||
Tier 1 Capital (to Average Assets), Actual Amount | $ 70,984 | $ 66,406 | |||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 31.96% | 31.64% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 30.77% | 30.58% | |||
Tier 1 capital (to Average Assets), Actual Ratio (as a percent) | 16.22% | 14.20% | |||
International Bank of Commerce, Zapata | Minimum | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 14,707 | $ 12,487 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 14,996 | $ 14,116 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 6.375% | 5.75% | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 6.50% | 6.50% | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 22,782 | $ 20,088 | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 23,070 | 21,717 | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | 18,168 | 15,745 | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 18,456 | 17,374 | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Amount | 17,507 | 18,701 | |||
Tier 1 Capital (to Average Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 21,884 | $ 23,376 | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 9.875% | 9.25% | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 10.00% | 10.00% | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 7.875% | 7.25% | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 8.00% | 8.00% | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Ratio (as a percent) | 4.00% | 4.00% | |||
Tier 1 Capital (to Average Assets), To Be well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 5.00% | 5.00% | |||
Commerce Bank | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Amount | $ 89,305 | $ 79,330 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 32.95% | 33.22% | |||
Total Capital (to Risk Weighted Assets), Actual Amount | $ 90,894 | ||||
Tier 1 Capital (to Risk Weighted Assets), Actual Amount | 89,305 | $ 81,278 | |||
Tier 1 Capital (to Average Assets), Actual Amount | $ 89,305 | $ 79,330 | |||
Total Capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 33.54% | 34.03% | |||
Tier 1 capital (to Risk Weighted Assets), Actual Ratio (as a percent) | 32.95% | 33.22% | |||
Tier 1 capital (to Average Assets), Actual Ratio (as a percent) | 15.53% | 14.56% | |||
Commerce Bank | Minimum | |||||
Capital Requirements | |||||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 17,276 | $ 13,733 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 17,615 | $ 15,524 | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 6.375% | 5.75% | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 6.50% | 6.50% | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | $ 26,761 | $ 22,092 | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 27,100 | 23,884 | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Amount | 21,341 | 17,316 | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | 21,680 | 19,107 | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Amount | 23,000 | 21,789 | |||
Tier 1 Capital (to Average Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Amount | $ 28,750 | $ 27,236 | |||
Total Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 9.875% | 9.25% | |||
Total Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 10.00% | 10.00% | |||
Tier 1 Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Ratio (as a percent) | 7.875% | 7.25% | |||
Tier 1 Capital (to Risk Weighted Assets), To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 8.00% | 8.00% | |||
Tier 1 Capital (to Average Assets), For Capital Adequacy Purposes Ratio (as a percent) | 4.00% | 4.00% | |||
Tier 1 Capital (to Average Assets), To Be well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent) | 5.00% | 5.00% |
Fair Value (Fair Value By Level
Fair Value (Fair Value By Level) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Assets: | ||
Available for sale debt securities | $ 3,411,350,000 | $ 4,124,184,000 |
Equity Securities | 5,937,000 | 27,886,000 |
Marketable Securities | 3,418,487,000 | 4,154,470,000 |
Assets/liabilities measured at fair value | Residential mortgage-backed securities | ||
Assets: | ||
Available for sale debt securities | 3,223,010,000 | 3,891,233,000 |
Assets/liabilities measured at fair value | Obligations of states and political subdivisions | ||
Assets: | ||
Available for sale debt securities | 188,340,000 | 232,951,000 |
Assets/liabilities measured at fair value | Equity securities with readily determinable fair values | ||
Assets: | ||
Equity Securities | 27,886,000 | |
Measured on a recurring basis: | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Marketable Securities | 5,937,000 | 27,886,000 |
Measured on a recurring basis: | Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity securities with readily determinable fair values | ||
Assets: | ||
Equity Securities | 5,937,000 | 27,886,000 |
Measured on a recurring basis: | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Marketable Securities | 3,411,350,000 | 4,124,184,000 |
Measured on a recurring basis: | Significant Other Observable Inputs (Level 2) | Residential mortgage-backed securities | ||
Assets: | ||
Available for sale debt securities | 3,223,010,000 | 3,891,233,000 |
Measured on a recurring basis: | Significant Other Observable Inputs (Level 2) | Obligations of states and political subdivisions | ||
Assets: | ||
Available for sale debt securities | 188,340,000 | 232,951,000 |
Measured on a recurring basis: | Assets/liabilities measured at fair value | ||
Assets: | ||
Marketable Securities | 3,417,287,000 | 4,152,070,000 |
Measured on a recurring basis: | Assets/liabilities measured at fair value | Residential mortgage-backed securities | ||
Assets: | ||
Available for sale debt securities | 3,223,010,000 | 3,891,233,000 |
Measured on a recurring basis: | Assets/liabilities measured at fair value | Obligations of states and political subdivisions | ||
Assets: | ||
Available for sale debt securities | 188,340,000 | 232,951,000 |
Measured on a recurring basis: | Assets/liabilities measured at fair value | Equity securities with readily determinable fair values | ||
Assets: | ||
Equity Securities | $ 5,937,000 | $ 27,886,000 |
Fair Value (Fair Value Measurem
Fair Value (Fair Value Measurement and Assumptions) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Assets: | |||
Impaired Loans | $ 14,306,000 | $ 53,267,000 | |
Non-financial assets: | |||
Other real estate owned | 57,344,000 | 30,519,000 | |
Assumptions used in discounted cash flow model to determine fair value of investments classified within level 3 | |||
Charges to allowance for probable loan losses in connection with other real estate owned | 170,000 | 30,000 | $ 381,000 |
Adjustment to fair value in connection with other real estate owned | 3,071,000 | 710,000 | $ 2,351,000 |
Impaired commercial collateral dependent loans | 14,306,000 | 53,267,000 | |
Impaired commercial collateral dependent receivables appraisals to determine fair value within immediately preceding twelve months | 10,911,000 | 18,585,000 | |
Impaired collateral dependent commercial loans with internal evaluation completed within last twelve months | 0 | 0 | |
Measured on a non-recurring basis | |||
Assumptions used in discounted cash flow model to determine fair value of investments classified within level 3 | |||
Change in net provision, impaired loans | 356,000 | 2,138,000 | |
Change in net provision, other real estate owned | 3,071,000 | 710,000 | |
Measured on a non-recurring basis | Significant Unobservable Inputs (Level 3) | |||
Assets: | |||
Impaired Loans | 1,563,000 | 11,210,000 | |
Non-financial assets: | |||
Other real estate owned | 38,871,000 | 2,000,000 | |
Assumptions used in discounted cash flow model to determine fair value of investments classified within level 3 | |||
Impaired commercial collateral dependent loans | 1,563,000 | 11,210,000 | |
Measured on a non-recurring basis | Assets/liabilities measured at fair value | |||
Assets: | |||
Impaired Loans | 1,563,000 | 11,210,000 | |
Non-financial assets: | |||
Other real estate owned | 38,871,000 | 2,000,000 | |
Assumptions used in discounted cash flow model to determine fair value of investments classified within level 3 | |||
Impaired commercial collateral dependent loans | $ 1,563,000 | $ 11,210,000 |
Fair Value Measurements (Other
Fair Value Measurements (Other Assumptions) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Deposits | ||
Carrying amount of time deposits | $ 1,973,468,000 | $ 2,056,506,000 |
Significant Unobservable Inputs (Level 3) | ||
Loans | ||
Carrying amount of fixed rate performing loans | 1,515,437,000 | 1,505,531,000 |
Estimated fair value of fixed rate performing loans | 1,469,231,000 | 1,454,434,000 |
Deposits | ||
Carrying amount of time deposits | 1,973,468,000 | 2,056,506,000 |
Estimated fair value of time deposits | 1,976,156,000 | 2,058,621,000 |
Securities Sold Under Repurchase Agreements | ||
Carrying amount of long-term repurchase agreements | 100,000,000 | |
Estimated fair value of long-term repurchase agreements | 99,504,000 | |
Significant Other Observable Inputs (Level 2) | ||
Other borrowed funds | ||
Carrying amount of the long-term FHLB borrowings | 436,690,000 | 250,000,000 |
Estimated fair value of long-term FHLB borrowings | $ 436,238,000 | $ 249,728,000 |
International Bancshares Corp_7
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Condition (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
ASSETS | ||||
Other investments | $ 337,507,000 | $ 293,990,000 | ||
Other assets | 190,376,000 | 81,529,000 | ||
Total assets | 11,871,952,000 | 12,184,698,000 | ||
Liabilities: | ||||
Junior subordinated deferrable interest debentures | 160,416,000 | 160,416,000 | ||
Other liabilities | 139,755,000 | 91,380,000 | ||
Total liabilities | 9,932,370,000 | 10,345,718,000 | ||
Shareholders' equity: | ||||
Common shares | 96,104,000 | 96,019,000 | ||
Surplus | 145,283,000 | 171,816,000 | ||
Retained earnings | 2,064,134,000 | 1,891,805,000 | ||
Accumulated other comprehensive (loss) income | (54,634,000) | (28,397,000) | ||
Total shareholders' equity before treasury stock | 2,250,887,000 | 2,131,243,000 | ||
Less cost of shares in treasury | (311,305,000) | (292,263,000) | ||
Total shareholders' equity | 1,939,582,000 | 1,838,980,000 | $ 1,724,667,000 | $ 1,665,503,000 |
Total liabilities and shareholders' equity | 11,871,952,000 | 12,184,698,000 | ||
Parent Company | Reportable Legal Entities | ||||
ASSETS | ||||
Cash | 19,065,000 | 18,398,000 | ||
Other investments | 105,377,000 | 92,620,000 | ||
Investment in subsidiaries | 1,987,293,000 | 1,878,521,000 | ||
Other assets | 23,120,000 | |||
Total assets | 2,111,735,000 | 2,012,659,000 | ||
Liabilities: | ||||
Junior subordinated deferrable interest debentures | 160,416,000 | 160,416,000 | ||
Due to IBC Trading | 21,000 | 21,000 | ||
Other liabilities | 11,716,000 | 13,242,000 | ||
Total liabilities | 172,153,000 | 173,679,000 | ||
Shareholders' equity: | ||||
Common shares | 96,104,000 | 96,019,000 | ||
Surplus | 145,283,000 | 171,816,000 | ||
Retained earnings | 2,064,134,000 | 1,891,805,000 | ||
Accumulated other comprehensive (loss) income | (54,634,000) | (28,397,000) | ||
Total shareholders' equity before treasury stock | 2,250,887,000 | 2,131,243,000 | ||
Less cost of shares in treasury | (311,305,000) | (292,263,000) | ||
Total shareholders' equity | 1,939,582,000 | 1,838,980,000 | ||
Total liabilities and shareholders' equity | $ 2,111,735,000 | $ 2,012,659,000 |
International Bancshares Corp_8
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Expenses: | |||
Interest expense (Debentures) | $ 6,989 | $ 5,392 | $ 4,600 |
Income before federal income taxes and equity in undistributed net income of subsidiaries | 272,583 | 221,642 | 197,003 |
Income tax expense | 56,652 | 64,206 | 63,071 |
Net income | 215,931 | 157,436 | 133,932 |
Parent Company | Reportable Legal Entities | |||
Income: | |||
Dividends from subsidiaries | 105,000 | 64,600 | 84,432 |
Interest income on notes receivable | 2 | ||
Interest income on other investments | 8,208 | 8,100 | 8,958 |
Other | 1,988 | 26 | 255 |
Total income | 115,196 | 72,726 | 93,647 |
Expenses: | |||
Interest expense (Debentures) | 6,989 | 5,392 | 4,600 |
Other | 2,930 | 5,648 | 3,637 |
Total expenses | 9,919 | 11,040 | 8,237 |
Income before federal income taxes and equity in undistributed net income of subsidiaries | 105,277 | 61,686 | 85,410 |
Income tax expense | 481 | (2,076) | 311 |
Income before equity in undistributed net income of subsidiaries | 104,796 | 63,762 | 85,099 |
Equity in undistributed net income of subsidiaries | 111,135 | 93,674 | 48,833 |
Net income | $ 215,931 | $ 157,436 | $ 133,932 |
International Bancshares Corp_9
International Bancshares Corporation (Parent Company Only) Financial Information Statements of Cash Flows (Details) - USD ($) | Sep. 19, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Operating activities: | ||||
Net income | $ 215,931,000 | $ 157,436,000 | $ 133,932,000 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Investment securities transactions, net | 141,000 | 4,774,000 | 2,626,000 | |
Unrealized loss on equity securities with readily determinable fair values | 388,000 | |||
Impairment charges on available for sale securities | 354,000 | |||
Stock compensation expense | 1,035,000 | 903,000 | 1,082,000 | |
(Decrease) increase in other liabilities | 24,916,000 | 592,000 | (7,705,000) | |
Net cash provided by operating activities | 229,847,000 | 196,819,000 | 203,220,000 | |
Investing activities: | ||||
Principal collected on mortgage-backed securities | 675,304,000 | 780,097,000 | 919,594,000 | |
Net cash provided by (used in) investing activities | 379,440,000 | (403,807,000) | (137,763,000) | |
Financing activities: | ||||
Redemption of long-term debt | (1,000,000) | |||
Proceeds from stock transactions | 1,522,000 | 1,455,000 | 549,000 | |
Payments of cash dividends - common | (49,599,000) | (43,594,000) | (39,569,000) | |
Repurchase of outstanding common stock warrant | $ (29,005,000) | (29,005,000) | ||
Purchase of treasury stock | (19,042,000) | (187,000) | (7,966,000) | |
Net cash (used in) provided by financing activities | (557,847,000) | 203,147,000 | (69,312,000) | |
Increase (decrease) in cash and cash equivalents | 51,440,000 | (3,841,000) | (3,855,000) | |
Cash and cash equivalents at beginning of period | 265,357,000 | 269,198,000 | 273,053,000 | |
Cash and cash equivalents at end of period | 316,797,000 | 265,357,000 | 269,198,000 | |
Parent Company | Reportable Legal Entities | ||||
Operating activities: | ||||
Net income | 215,931,000 | 157,436,000 | 133,932,000 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Investment securities transactions, net | (23,000) | |||
Unrealized loss on equity securities with readily determinable fair values | 330,000 | |||
Impairment charges on available for sale securities | 112,000 | |||
Stock compensation expense | 1,035,000 | 903,000 | 1,082,000 | |
(Decrease) increase in other liabilities | (1,479,000) | (3,453,000) | 3,901,000 | |
Equity in undistributed net income of subsidiaries | (111,135,000) | (93,674,000) | (48,833,000) | |
Net cash provided by operating activities | 104,682,000 | 61,189,000 | 90,194,000 | |
Investing activities: | ||||
Principal collected on mortgage-backed securities | 6,328,000 | 1,105,000 | ||
Net decrease in notes receivable | 99,000 | |||
Increase in other assets and other investments | (7,891,000) | (25,348,000) | (27,834,000) | |
Net cash provided by (used in) investing activities | (7,891,000) | (19,020,000) | (26,630,000) | |
Financing activities: | ||||
Redemption of long-term debt | (1,000,000) | |||
Proceeds from stock transactions | 1,522,000 | 1,455,000 | 549,000 | |
Payments of cash dividends - common | (49,599,000) | (43,594,000) | (39,569,000) | |
Repurchase of outstanding common stock warrant | (29,005,000) | |||
Purchase of treasury stock | (19,042,000) | (187,000) | (7,966,000) | |
Net cash (used in) provided by financing activities | (96,124,000) | (42,326,000) | (47,986,000) | |
Increase (decrease) in cash and cash equivalents | 667,000 | (157,000) | 15,578,000 | |
Cash and cash equivalents at beginning of period | 18,398,000 | 18,555,000 | 2,977,000 | |
Cash and cash equivalents at end of period | $ 19,065,000 | $ 18,398,000 | $ 18,555,000 |