Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 03, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | FIRST HAWAIIAN, INC. | |
Entity Central Index Key | 36,377 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 139,546,615 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Interest income | ||||
Loans and lease financing | $ 114,179 | $ 105,701 | $ 223,445 | $ 210,058 |
Available-for-sale securities | 25,059 | 19,453 | 51,488 | 36,012 |
Other | 781 | 1,907 | 2,007 | 4,803 |
Total interest income | 140,019 | 127,061 | 276,940 | 250,873 |
Interest expense | ||||
Deposits | 8,760 | 6,541 | 16,330 | 12,970 |
Short-term borrowings and long-term debt | 5 | 93 | 11 | 164 |
Total interest expense | 8,765 | 6,634 | 16,341 | 13,134 |
Net interest income | 131,254 | 120,427 | 260,599 | 237,739 |
Provision for loan and lease losses | 4,400 | 1,900 | 8,900 | 2,600 |
Net interest income after provision for loan and lease losses | 126,854 | 118,527 | 251,699 | 235,139 |
Noninterest income | ||||
Service charges on deposit accounts | 9,412 | 9,395 | 18,967 | 19,184 |
Credit and debit card fees | 14,157 | 13,810 | 28,636 | 27,629 |
Other service charges and fees | 8,110 | 8,914 | 17,207 | 18,141 |
Trust and investment services income | 7,526 | 7,323 | 14,864 | 14,728 |
Bank-owned life insurance | 2,927 | 3,792 | 7,505 | 6,148 |
Investment securities gains, net | 3 | 25,731 | ||
Other | 6,738 | 3,134 | 11,098 | 8,329 |
Total noninterest income | 48,870 | 46,371 | 98,277 | 119,890 |
Noninterest expense | ||||
Salaries and employee benefits | 43,257 | 41,955 | 86,557 | 86,656 |
Contracted services and professional fees | 12,388 | 9,939 | 22,696 | 22,694 |
Occupancy | 5,023 | 4,809 | 10,344 | 10,121 |
Equipment | 4,527 | 4,116 | 8,724 | 7,943 |
Regulatory assessment and fees | 3,750 | 2,846 | 7,524 | 5,323 |
Advertising and marketing | 1,222 | 1,425 | 3,250 | 3,049 |
Card rewards program | 4,618 | 2,729 | 9,129 | 6,231 |
Other | 10,456 | 10,654 | 21,356 | 21,520 |
Total noninterest expense | 85,241 | 78,473 | 169,580 | 163,537 |
Income before provision for income taxes | 90,483 | 86,425 | 180,396 | 191,492 |
Provision for income taxes | 33,588 | 31,565 | 66,761 | 71,101 |
Net income | $ 56,895 | $ 54,860 | $ 113,635 | $ 120,391 |
Basic earnings per share (in dollars per share) | $ 0.41 | $ 0.39 | $ 0.81 | $ 0.86 |
Diluted earnings per share (in dollars per share) | 0.41 | 0.39 | 0.81 | 0.86 |
Dividends declared per share (in dollars per share) | $ 0.22 | $ 0.22 | $ 0.44 | $ 0.22 |
Basic weighted-average outstanding shares (in shares) | 139,546,615 | 139,459,620 | 139,546,174 | 139,459,620 |
Diluted weighted-average outstanding shares (in shares) | 139,646,117 | 139,459,620 | 139,644,557 | 139,459,620 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Consolidated Statements of Comprehensive Income | ||||
Net income | $ 56,895 | $ 54,860 | $ 113,635 | $ 120,391 |
Other comprehensive income, net of tax: | ||||
Net unrealized losses on pensions and other benefits | (46) | (46) | ||
Net unrealized gains on investment securities | 18,885 | 13,067 | 19,842 | 46,455 |
Net unrealized gains (losses) on cash flow derivative hedges | 156 | 125 | 518 | (377) |
Other comprehensive income | 19,041 | 13,146 | 20,360 | 46,032 |
Total comprehensive income | $ 75,936 | $ 68,006 | $ 133,995 | $ 166,423 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and due from banks | $ 355,752 | $ 253,827 |
Interest-bearing deposits in other banks | 872,013 | 798,231 |
Investment securities | 5,126,869 | 5,077,514 |
Loans and leases | 12,062,392 | 11,520,378 |
Less: allowance for loan and lease losses | 136,883 | 135,494 |
Net loans and leases | 11,925,509 | 11,384,884 |
Premises and equipment, net | 292,959 | 300,788 |
Other real estate owned and repossessed personal property | 329 | 329 |
Accrued interest receivable | 39,739 | 41,971 |
Bank-owned life insurance | 432,726 | 429,209 |
Goodwill | 995,492 | 995,492 |
Other intangible assets | 14,877 | 16,809 |
Other assets | 317,709 | 362,775 |
Total assets | 20,373,974 | 19,661,829 |
Deposits: | ||
Interest-bearing | 11,580,664 | 10,801,915 |
Noninterest-bearing | 5,871,598 | 5,992,617 |
Total deposits | 17,452,262 | 16,794,532 |
Short-term borrowings | 9,151 | |
Long-term debt | 41 | 41 |
Retirement benefits payable | 134,400 | 132,904 |
Other liabilities | 234,669 | 248,716 |
Total liabilities | 17,821,372 | 17,185,344 |
Commitments and contingent liabilities (Note 11) | ||
Stockholders' equity | ||
Common stock ($0.01 par value; authorized 300,000,000 shares; issued and outstanding 139,546,615 shares and 139,530,654 shares as of June 30, 2017 and December 31, 2016, respectively) | 1,395 | 1,395 |
Additional paid-in capital | 2,488,091 | 2,484,251 |
Retained earnings | 130,767 | 78,850 |
Accumulated other comprehensive loss, net | (67,651) | (88,011) |
Total stockholders' equity | 2,552,602 | 2,476,485 |
Total liabilities and stockholders' equity | $ 20,373,974 | $ 19,661,829 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Consolidated Balance Sheets | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, issued (in shares) | 139,546,615 | 139,530,654 |
Common stock outstanding (in shares) | 139,546,615 | 139,530,654 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Net Investment | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total |
Balance at Dec. 31, 2015 | $ 2,788,200 | $ (51,259) | $ 2,736,941 | |||
Balance (in shares) at Dec. 31, 2015 | 139,459,620 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | Subsequent to reorganization on April 1, 2016 | $ 54,860 | 54,860 | ||||
Net income | Prior to reorganization on April 1, 2016 | 65,531 | 65,531 | ||||
Net income | 120,391 | |||||
Distributions | Subsequent to reorganization on April 1, 2016 | $ (70,724) | (70,724) | ||||
Distributions | Prior to reorganization on April 1, 2016 | (363,624) | (363,624) | ||||
Contributions | 61,992 | 61,992 | ||||
Recapitalization of First Hawaiian, Inc. | $ (2,490,107) | $ 1,395 | 2,488,712 | |||
Cash dividends declared ($0.44 and $0.22 per share for six months ended June 30, 2017 and 2016, respectively) | (30,000) | (30,000) | ||||
Other comprehensive income, net of tax | 46,032 | 46,032 | ||||
Balance at Jun. 30, 2016 | $ 1,395 | 2,479,980 | 24,860 | (5,227) | 2,501,008 | |
Balance (in shares) at Jun. 30, 2016 | 139,459,620 | |||||
Balance at Mar. 31, 2016 | (18,373) | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 54,860 | |||||
Other comprehensive income, net of tax | 13,146 | 13,146 | ||||
Balance at Jun. 30, 2016 | $ 1,395 | 2,479,980 | 24,860 | (5,227) | 2,501,008 | |
Balance (in shares) at Jun. 30, 2016 | 139,459,620 | |||||
Balance at Dec. 31, 2016 | $ 1,395 | 2,484,251 | 78,850 | (88,011) | $ 2,476,485 | |
Balance (in shares) at Dec. 31, 2016 | 139,530,654 | 139,530,654 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 113,635 | $ 113,635 | ||||
Cash dividends declared ($0.44 and $0.22 per share for six months ended June 30, 2017 and 2016, respectively) | (61,400) | (61,400) | ||||
Common stock issued under Employee Stock Purchase Plan | 528 | 528 | ||||
Common stock issued under Employee Stock Purchase Plan (in shares) | 15,961 | |||||
Equity-based awards | 3,312 | (318) | 2,994 | |||
Other comprehensive income, net of tax | 20,360 | 20,360 | ||||
Balance at Jun. 30, 2017 | $ 1,395 | 2,488,091 | 130,767 | (67,651) | $ 2,552,602 | |
Balance (in shares) at Jun. 30, 2017 | 139,546,615 | 139,546,615 | ||||
Balance at Mar. 31, 2017 | (86,692) | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | $ 56,895 | |||||
Other comprehensive income, net of tax | 19,041 | 19,041 | ||||
Balance at Jun. 30, 2017 | $ 1,395 | $ 2,488,091 | $ 130,767 | $ (67,651) | $ 2,552,602 | |
Balance (in shares) at Jun. 30, 2017 | 139,546,615 | 139,546,615 |
Consolidated Statements of Sto7
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Consolidated Statements of Stockholders' Equity | ||||
Cash dividends declared (in dollars per share) | $ 0.22 | $ 0.22 | $ 0.44 | $ 0.22 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operating activities: | ||
Net income | $ 113,635 | $ 120,391 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for loan and lease losses | 8,900 | 2,600 |
Depreciation, amortization and accretion, net | 30,220 | 24,495 |
Deferred income taxes | 4,425 | 6,662 |
Stock-based compensation | 2,994 | |
Other gains | (133) | (25) |
Net gains on sales of loans held for sale | (13) | |
Net gains on investment securities | (25,731) | |
Change in assets and liabilities: | ||
Net decrease in other assets | 13,487 | 14,157 |
Net decrease in other liabilities | (14,619) | (2,711) |
Net cash provided by operating activities | 158,896 | 139,838 |
Available-for-sale securities: | ||
Proceeds from maturities and principal repayments | 412,621 | 551,595 |
Proceeds from sales | 534,107 | |
Purchases | (438,348) | (1,554,942) |
Other investments: | ||
Proceeds from sales | 11,463 | 11,801 |
Purchases | (9,651) | (11,832) |
Loans: | ||
Net increase in loans and leases resulting from originations and principal repayments | (539,237) | (466,843) |
Proceeds from sales of loans originated for investment | 672 | |
Purchases of loans | (8,000) | |
Proceeds from bank-owned life insurance | 3,987 | 1,021 |
Purchases of premises, equipment and software | (4,019) | (8,565) |
Proceeds from sales of premises and equipment | 27 | 50 |
Proceeds from sales of other real estate owned | 635 | 167 |
Other | (1,046) | 66 |
Net cash used in investing activities | (570,896) | (943,375) |
Cash flows from financing activities | ||
Net increase in deposits | 657,730 | 60,180 |
Net decrease in short-term borrowings | (9,151) | (181,200) |
Dividends paid | (61,400) | (30,000) |
Distributions paid | (363,624) | |
Proceeds from employee stock purchase plan | 528 | |
Net cash provided by (used in) financing activities | 587,707 | (514,644) |
Net increase (decrease) in cash and cash equivalents | 175,707 | (1,318,181) |
Cash and cash equivalents at beginning of period | 1,052,058 | 2,650,195 |
Cash and cash equivalents at end of period | 1,227,765 | 1,332,014 |
Supplemental disclosures | ||
Interest paid | 15,154 | 12,663 |
Income taxes paid, net of income tax refunds | 31,091 | 104,792 |
Noncash investing and financing activities: | ||
Transfers from loans and leases to other real estate owned | 524 | 202 |
Transfers from loans and leases to loans held for sale | $ 659 | |
Derivative liability entered into in connection with sale of investment securities | $ 8,828 |
Organization and Basis of Prese
Organization and Basis of Presentation | 6 Months Ended |
Jun. 30, 2017 | |
Organization and Basis of Presentation | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation First Hawaiian, Inc. (“FHI”), a bank holding company, owns 100% of the outstanding common stock of First Hawaiian Bank (“FHB” or the “Bank”), its only direct, wholly-owned subsidiary. FHI is a majority-owned, indirect subsidiary of BNP Paribas (“BNPP”), a financial institution based in France. Reorganization Transactions In connection with FHI’s initial public offering (“IPO”) in August 2016, in which BNPP sold approximately 17% of its interest in FHI, BNPP announced its intent to sell a controlling interest in FHI, including its wholly-owned subsidiary FHB, over time, subject to market conditions and other considerations. On April 1, 2016, a series of reorganization transactions (the “Reorganization Transactions”) were undertaken to facilitate the IPO. As part of the Reorganization Transactions, FHI, which was then known as BancWest Corporation (“BancWest”), formed a new bank holding company, BancWest Holding Inc. (“BWHI”), a Delaware corporation and a direct wholly-owned subsidiary of BancWest, and contributed 100% of its interest in Bank of the West (“BOW”), as well as other assets and liabilities not related to FHB, to BWHI. Following the contribution of BOW to BWHI, BancWest distributed its interest in BWHI to BNPP. As part of these transactions, BancWest amended its certificate of incorporation to change its name to “First Hawaiian, Inc.”, with First Hawaiian Bank remaining as the only direct wholly-owned subsidiary of FHI. On July 1, 2016, in order to comply with the Board of Governors of the Federal Reserve System’s requirement (under Regulation YY) applicable to BNPP that a foreign banking organization with $50 billion or more in U.S. non-branch assets as of June 30, 2015 establish a U.S. intermediate holding company and hold its interest in the substantial majority of its U.S. subsidiaries through the intermediate holding company by July 1, 2016, FHI became an indirect subsidiary of BNP Paribas USA, Inc. (“BNP Paribas USA”), BNPP’s U.S. intermediate holding company. As part of that reorganization, FHI became a direct wholly-owned subsidiary of BancWest Corporation (“BWC”), a direct wholly-owned subsidiary of BNP Paribas USA. On August 4, 2016, FHI’s common stock began trading on the NASDAQ Global Select Market under the ticker symbol “FHB”. On August 9, 2016, the IPO of 24,250,000 shares of FHI common stock, which included the full exercise of the underwriters’ option to purchase an additional 3,163,043 shares, at $23.00 per share was completed. On February 17, 2017, a secondary offering of 28,750,000 shares of FHI common stock, which included the full exercise of the underwriters’ option to purchase an additional 3,750,000 shares, at $32.00 per share was completed. FHI did not receive any of the proceeds from the sales of shares by BNPP. Following the secondary offering and exercise of the underwriters’ option to purchase additional shares in February 2017, BNPP beneficially owned approximately 62% of FHI’s common stock. BNPP continued to beneficially own approximately 62% of FHI’s common stock as of June 30, 2017. Basis of Presentation The accompanying unaudited consolidated financial statements of First Hawaiian, Inc. and Subsidiary (the “Company”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The accompanying unaudited consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. In the opinion of management, all adjustments, which consist of normal recurring adjustments necessary for a fair presentation of the interim period consolidated financial information, have been made. Results of operations for interim periods are not necessarily indicative of results to be expected for the entire year. Intercompany account balances and transactions have been eliminated in consolidation. Use of Estimates in the Preparation of Financial Statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Although these estimates are based on management’s best knowledge of current events, actual results may differ from these estimates. Accounting Standards Adopted in 2017 In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . This guidance requires entities to record all excess tax benefits and tax deficiencies as an income tax benefit or expense in the statement of income; changes the classification of excess tax benefits to an operating activity in the statement of cash flows; allows entities to elect whether to account for forfeitures of share-based payments by recognizing forfeitures of awards as they occur or by estimating the number of awards expected to be forfeited and adjusting the estimate when it is no longer probable that the employee will fulfill the service condition, as is currently required; and permitting entities to withhold up to the maximum individual statutory tax rate without classifying the awards as a liability. Upon adoption of ASU No. 2016-09 on January 1, 2017, the Company made an accounting policy election to recognize forfeitures of stock-based awards as they occur. The adoption of ASU No. 2016-09 did not have a material impact on the Company’s consolidated financial statements. Recent Accounting Pronouncements The following ASUs have been issued by the FASB and are applicable to the Company in future reporting periods. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . This guidance amends most of the currently existing revenue recognition principles and requires entities to recognize revenues when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company has completed an overall assessment of revenue streams that will be potentially affected by the new guidance. The Company is in the process of identifying contracts that are under the scope of the new guidance. The contracts that management expects to review include those related to commission income, service charges and fees on deposit accounts, credit card arrangements and trust and custody services. This update will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company expects to adopt a modified retrospective transition approach, in which the guidance would only be applied to existing contracts in effect at the adoption date and new contracts entered into after the adoption date. The Company continues to evaluate the impact that this standard will have on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This guidance provides that lessees will be required to recognize the following for all leases (with the exception of short-term leases): 1) a lease liability, which is the present value of a lessee's obligation to make lease payments, and 2) a right-of-use asset, which is an asset that represents the lessee's right to use, or control the use of, a specified asset for the lease term. Lessor accounting under the new guidance remains largely unchanged as it is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. This update will be effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period presented in the financial statements. The Company has lease agreements, such as leases for branch locations, which are currently considered operating leases, and therefore, not recognized on the Company’s consolidated balance sheets. The Company preliminarily expects the new guidance will require these lease agreements to be recognized on the consolidated balance sheets as a right-of-use asset with a corresponding lease liability. However, the Company continues to evaluate the extent of the potential impact this guidance will have on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This guidance changes the accounting for credit losses on loans and debt securities. For loans and held-to-maturity debt securities, this update requires a current expected credit loss (“CECL”) approach to determine the allowance for credit losses. CECL requires loss estimates for the remaining estimated life of the financial asset using historical experience, current conditions and reasonable and supportable forecasts. In addition, this guidance modifies the other-than-temporary impairment model for available-for-sale debt securities to require an allowance for credit impairment instead of a direct write-down, which allows for a reversal of credit losses in future periods. This update requires entities to record a cumulative effect adjustment to the balance sheet as of the beginning of the first reporting period in which the guidance is effective. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with earlier adoption permitted. The Company is currently evaluating the capability of its existing systems and processes to support the implementation of this new standard as well as the impact that this standard will have on the Company’s consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. This guidance simplifies the subsequent measurement of goodwill by eliminating Step 2 from the current two-step goodwill impairment test. This guidance provides that a goodwill impairment test be conducted by comparing the fair value of a reporting unit with its carrying amount. Entities are to recognize an impairment charge for goodwill by the amount by which the carrying amount exceeds the reporting unit’s fair value. Entities will continue to have the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The adoption of ASU No. 2017-04 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2017, the FASB issued ASU No. 2017-07, Compensation – Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This guidance requires entities to report the service cost component of net periodic benefit cost in the same line item as other compensation costs arising from services rendered by pertinent employees during the reporting period. The other components of net periodic benefit costs are to be presented in the income statement separately from the service cost component. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The adoption of ASU No. 2017-07 is not expected to have a material impact on the Company’s consolidated financial statements. In March 2017, the FASB issued ASU No. 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities. Under current GAAP, entities normally amortize the premium as an adjustment of yield over the contractual life of the instrument. This guidance shortens the amortization period for certain callable debt securities held at a premium to the earliest call date. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The adoption of ASU No. 2017-08 is not expected to have a material impact on the Company’s consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718), Scope of Modification Accounting. This guidance applies to entities that change the terms or conditions of a share-based payment award. This update clarifies when an entity should account for a change as a modification. Modification accounting will be required only if the fair value, the vesting conditions or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The adoption of ASU No. 2017-09 is not expected to have a material impact on the Company’s consolidated financial statements. |
Investment Securities
Investment Securities | 6 Months Ended |
Jun. 30, 2017 | |
Investment Securities | |
Investment Securities | 2. Investment Securities As of June 30, 2017 and December 31, 2016, investment securities consisted predominantly of the following investment categories: U.S. Treasury and debt securities – includes U.S. Treasury notes and debt securities issued by government-sponsored enterprises. Mortgage- and asset-backed securities – includes securities backed by notes or receivables secured by either mortgage or prime auto assets with cash flows based on actual or scheduled payments. Collateralized mortgage obligations – includes securities backed by a pool of mortgages with cash flows distributed based on certain rules rather than pass through payments. As of June 30, 2017 and December 31, 2016, all of the Company’s investment securities were classified as debt securities and available-for-sale. Amortized cost and fair value of securities as of June 30, 2017 and December 31, 2016 were as follows: June 30, 2017 December 31, 2016 Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Cost Gains Losses Value U.S. Treasury securities $ 405,011 $ — $ (8,169) $ 396,842 $ 405,637 $ — $ (13,164) $ 392,473 Government-sponsored enterprises debt securities 249,709 54 (4,445) 245,318 249,707 16 (7,056) 242,667 Government agency mortgage-backed securities 173,078 — (4,280) 168,798 190,485 — (4,822) 185,663 Government-sponsored enterprises mortgage-backed securities 194,340 267 (2,990) 191,617 208,034 385 (4,034) 204,385 Non-government asset-backed securities 3,802 — (1) 3,801 12,592 — (9) 12,583 Collateralized mortgage obligations: Government agency 3,345,644 1,760 (38,085) 3,309,319 3,409,822 794 (58,794) 3,351,822 Government-sponsored enterprises 821,593 1,236 (11,655) 811,174 700,338 789 (13,206) 687,921 Total available-for-sale securities $ 5,193,177 $ 3,317 $ (69,625) $ 5,126,869 $ 5,176,615 $ 1,984 $ (101,085) $ 5,077,514 Proceeds from calls and sales of investment securities were nil for both the three and six months ended June 30, 2017. Proceeds from calls and sales of investment securities totaled $50.0 million and nil, respectively, for the three months ended June 30, 2016, and $75.0 million and $505.0 million, respectively, for the six months ended June 30, 2016. Gross realized gains were nil for both the three and six months ended June 30, 2017. Including the 2016 sale of Visa Class B restricted shares described below, the Company recorded gross realized gains of nil and $25.8 million for the three and six months ended June 30, 2016, respectively. Gross realized losses were nil for both the three and six months ended June 30, 2017. The Company recorded gross realized losses of nil and $0.1 million for the three and six months ended June 30, 2016, respectively. The provision for income taxes related to the Company’s net realized gains on the sale of investment securities was nil for the three and six months ended June 30, 2017 and nil and $10.2 million for the three and six months ended June 30, 2016, respectively. Gains and losses realized on sales of securities are determined using the specific identification method. Interest income from taxable investment securities was $25.1 million and $19.5 million for the three months ended June 30, 2017 and 2016, respectively, and $51.5 million and $36.0 million for the six months ended June 30, 2017 and 2016, respectively. The Company did not own any non-taxable investment securities during both the three and six months ended June 30, 2017 and 2016. The amortized cost and fair value of U.S. Treasury and government-sponsored enterprises debt securities as of June 30, 2017, by contractual maturity, are shown below. Mortgage-backed securities, asset-backed securities and collateralized mortgage obligations are disclosed separately in the table below as remaining expected maturities will differ from contractual maturities as borrowers have the right to prepay obligations. June 30, 2017 Amortized Fair (dollars in thousands) Cost Value Due after one year through five years $ 305,580 $ 299,129 Due after five years through ten years 349,140 343,031 654,720 642,160 Government agency mortgage-backed securities 173,078 168,798 Government-sponsored enterprises mortgage-backed securities 194,340 191,617 Non-government asset-backed securities 3,802 3,801 Collateralized mortgage obligations: Government agency 3,345,644 3,309,319 Government-sponsored enterprises 821,593 811,174 Total mortgage- and asset-backed securities 4,538,457 4,484,709 Total available-for-sale securities $ 5,193,177 $ 5,126,869 At June 30, 2017, pledged securities totaled $2.9 billion, of which $2.7 billion was pledged to secure public deposits and $230.0 million was pledged to secure other financial transactions. At December 31, 2016, pledged securities totaled $2.7 billion, of which $2.5 billion was pledged to secure public deposits and repurchase agreements, and $209.1 million was pledged to secure other financial transactions. The Company held no securities of any single issuer, other than the U.S. government, government agency and government-sponsored enterprises, which were in excess of 10% of stockholders’ equity as of June 30, 2017 and December 31, 2016. The following table presents the gross unrealized losses and fair values of securities in the available-for-sale portfolio by length of time that the 165 and 158 individual securities in each category have been in a continuous loss position as of June 30, 2017 and December 31, 2016, respectively. The gross unrealized losses were primarily attributable to changes in interest rates, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities. Time in Continuous Loss as of June 30, 2017 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value U.S. Treasury securities $ (8,169) $ 396,842 $ — $ — $ (8,169) $ 396,842 Government-sponsored enterprises debt securities (4,445) 210,264 — — (4,445) 210,264 Government agency mortgage-backed securities (4,280) 168,798 — — (4,280) 168,798 Government-sponsored enterprises mortgage-backed securities (2,990) 184,143 — — (2,990) 184,143 Non-government asset-backed securities (1) 1,640 — 2,161 (1) 3,801 Collateralized mortgage obligations: Government agency (29,692) 2,488,757 (8,393) 329,429 (38,085) 2,818,186 Government-sponsored enterprises (2,213) 373,103 (9,442) 254,440 (11,655) 627,543 Total available-for-sale securities with unrealized losses $ (51,790) $ 3,823,547 $ (17,835) $ 586,030 $ (69,625) $ 4,409,577 Time in Continuous Loss as of December 31, 2016 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value U.S. Treasury securities $ (13,164) $ 392,473 $ — $ — $ (13,164) $ 392,473 Government-sponsored enterprises debt securities (7,056) 207,651 — — (7,056) 207,651 Government agency mortgage-backed securities (4,822) 185,663 — — (4,822) 185,663 Government-sponsored enterprises mortgage-backed securities (4,034) 195,848 — — (4,034) 195,848 Non-government asset-backed securities (3) 5,202 (6) 7,381 (9) 12,583 Collateralized mortgage obligations: Government agency (51,484) 2,847,103 (7,310) 233,706 (58,794) 3,080,809 Government-sponsored enterprises (1,807) 252,065 (11,399) 279,282 (13,206) 531,347 Total available-for-sale securities with unrealized losses $ (82,370) $ 4,086,005 $ (18,715) $ 520,369 $ (101,085) $ 4,606,374 Other-Than-Temporary Impairment (“OTTI”) Unrealized losses for all investment securities are reviewed to determine whether the losses are other than temporary. Investment securities are evaluated for OTTI on at least a quarterly basis, and more frequently when economic and market conditions warrant such an evaluation, to determine whether the decline in fair value below amortized cost is other than temporary. The term other-than-temporary is not intended to indicate that the decline is permanent, but indicates that the prospects for a near-term recovery of value are not necessarily favorable, or that there is a general lack of evidence to support a realizable value equal to or greater than the carrying value of the investment. The decline in value is not related to any issuer- or industry-specific credit event. At June 30, 2017 and December 31, 2016, the Company did not have the intent to sell and determined it was more likely than not that the Company would not be required to sell the securities prior to recovery of the amortized cost basis. As the Company has the intent and ability to hold securities in an unrealized loss position, each security with an unrealized loss position in the above tables has been further assessed to determine if a credit loss exists. If it is probable that the Company will not collect all amounts due according to the contractual terms of an investment security, an OTTI is considered to have occurred. In determining whether a credit loss exists, the Company estimates the present value of future cash flows expected to be collected from the investment security. If the present value of future cash flows is less than the amortized cost basis of the security, an OTTI exists. As of June 30, 2017 and December 31, 2016, the Company did not expect any credit losses in its debt securities and no OTTI was recognized on securities during the six months ended June 30, 2017 and for the year ended December 31, 2016. Visa Class B Restricted Shares In 2008, the Company received 394,000 Visa Class B restricted shares as part of Visa’s initial public offering. Visa Class B restricted shares are not currently convertible to publicly traded Visa Class A common shares, and only transferable in limited circumstances, until the settlement of certain litigation which are indemnified by Visa members, including the Company. As there are existing transfer restrictions and the outcome of the aforementioned litigation is uncertain, these shares were included in the consolidated balance sheets at their historical cost of $0. During the six months ended June 30, 2016, the Company recorded a $22.7 million net realized gain related to the sale of 274,000 Visa Class B restricted shares (recorded in the three months ended March 31, 2016). Concurrent with the sale of the Visa Class B restricted shares, the Company entered into an agreement with the buyer that requires payment to the buyer in the event Visa reduces each member bank’s Class B conversion ratio to unrestricted Class A common shares. See “Note 10. Derivative Financial Instruments” for more information. There were no such sales during the six months ended June 30, 2017 or during the three months ended June 30, 2016. The Company held approximately 120,000 Visa Class B restricted shares as of both June 30, 2017 and December 31, 2016. These shares continued to be carried at $0 cost basis during each of the respective periods. |
Loans and Leases
Loans and Leases | 6 Months Ended |
Jun. 30, 2017 | |
Loans and Leases | |
Loans and Leases | 3. Loans and Leases As of June 30, 2017 and December 31, 2016, loans and leases were comprised of the following: June 30, December 31, (dollars in thousands) 2017 2016 Commercial and industrial $ 3,331,092 $ 3,239,600 Real estate: Commercial 2,545,479 2,343,495 Construction 555,794 450,012 Residential 3,921,881 3,796,459 Total real estate 7,023,154 6,589,966 Consumer 1,527,470 1,510,772 Lease financing 180,676 180,040 Total loans and leases $ 12,062,392 $ 11,520,378 Outstanding loan balances are reported net of unearned income, including net deferred loan costs of $27.4 million and $23.8 million at June 30, 2017 and December 31, 2016, respectively. As of June 30, 2017, residential real estate loans totaling $2.3 billion were pledged to collateralize the Company’s borrowing capacity at the Federal Home Loan Bank of Des Moines (“FHLB”), and consumer and commercial and industrial loans totaling $903.3 million were pledged to collateralize the borrowing capacity at the Federal Reserve Bank of San Francisco (“FRB”). As of December 31, 2016, residential real estate loans totaling $2.1 billion were pledged to collateralize the Company’s borrowing capacity at the FHLB, and consumer and commercial and industrial loans totaling $935.7 million were pledged to collateralize the borrowing capacity at the FRB. Residential real estate loans collateralized by properties that were in the process of foreclosure totaled $2.4 million and $4.1 million at June 30, 2017 and December 31, 2016, respectively. In the course of evaluating the credit risk presented by a customer and the pricing that will adequately compensate the Company for assuming that risk, management may require a certain amount of collateral support. The type of collateral held varies, but may include accounts receivable, inventory, land, buildings, equipment, income-producing commercial properties and residential real estate. The Company applies the same collateral policy for loans whether they are funded immediately or on a delayed basis. The loan and lease portfolio is principally located in Hawaii and, to a lesser extent, on the U.S. Mainland, Guam and Saipan. The risk inherent in the portfolio depends upon both the economic stability of the state or territories, which affects property values, and the financial strength and creditworthiness of the borrowers. At June 30, 2017 and December 31, 2016, remaining loan and lease commitments were comprised of the following: June 30, December 31, (dollars in thousands) 2017 2016 Commercial and industrial $ 2,180,122 $ 2,185,810 Real estate: Commercial 83,774 88,331 Construction 417,633 434,406 Residential 990,924 953,781 Total real estate 1,492,331 1,476,518 Consumer 1,481,746 1,459,467 Lease financing 16 16 Total loan and lease commitments $ 5,154,215 $ 5,121,811 |
Allowance for Loan and Lease Lo
Allowance for Loan and Lease Losses | 6 Months Ended |
Jun. 30, 2017 | |
Allowance for Loan and Lease Losses | |
Allowance for Loan and Lease Losses | 4. Allowance for Loan and Lease Losses The Company must maintain an allowance for loan and lease losses (the “Allowance”) that is adequate to absorb estimated probable credit losses associated with its loan and lease portfolio. The Allowance consists of an allocated portion, which covers estimated credit losses for specifically identified loans and pools of loans and leases, and an unallocated portion. Segmentation Management has identified three primary portfolio segments in estimating the Allowance: commercial lending, residential real estate lending and consumer lending. Commercial lending is further segmented into four distinct portfolios based on characteristics relating to the borrower, transaction, and collateral. These portfolio segments are: commercial and industrial, commercial real estate, construction, and lease financing. Residential real estate is not further segmented, but consists of single-family residential mortgages, real estate secured installment loans and home equity lines of credit. Consumer lending is not further segmented, but consists primarily of automobile loans, credit cards, and other installment loans. Management has developed a methodology for each segment taking into consideration portfolio segment-specific factors such as product type, loan portfolio characteristics, management information systems, and other risk factors. Specific Allocation Commercial A specific allocation is determined for individually impaired commercial loans. A loan is considered impaired when it is probable that the Company will be unable to collect the full amount of principal and interest according to the contractual terms of the loan agreement. Management identifies material impaired loans based on their size in relation to the Company’s total loan and lease portfolio. Each impaired loan equal to or exceeding a specified threshold requires an analysis to determine the appropriate level of reserve for that specific loan. Impaired loans below the specified threshold are treated as a pool, with specific allocations established based on qualitative factors such as asset quality trends, risk identification, lending policies, portfolio growth, and portfolio concentrations. Residential A specific allocation is determined for residential real estate loans based on delinquency status. In addition, each impaired loan equal to or exceeding a specified threshold requires analysis to determine the appropriate level of reserve for that specific loan, generally based on the value of the underlying collateral less estimated costs to sell. The specific allocation will be zero for impaired loans in which the value of the underlying collateral, less estimated costs to sell, exceeds the unpaid principal balance of the loan. Consumer A specific allocation is determined for the consumer loan portfolio using delinquency-based formula allocations. The Company uses a formula approach in determining the consumer loan specific allocation and recognizes the statistical validity of measuring losses predicated on past due status. Pooled Allocation Commercial Pooled allocation for pass, special mention, substandard, and doubtful grade commercial loans and leases that share common risk characteristics and properties is determined using a historical loss rate analysis and qualitative factor considerations. Loan grade categories are discussed under “Credit Quality”. Residential and Consumer Pooled allocation for non-delinquent consumer and residential real estate loans is determined using a historical loss rate analysis and qualitative factor considerations. Qualitative Adjustments Qualitative adjustments to historical loss rates or other static sources may be necessary since these rates may not be an accurate indicator of losses inherent in the current portfolio. To estimate the level of adjustments, management considers factors including global, national and local economic conditions; levels and trends in problem loans; the effect of credit concentrations; collateral value trends; changes in risk due to changes in lending policies and practices; management expertise; industry and regulatory trends; and volume of loans. Unallocated Allowance The Company’s Allowance incorporates an unallocated portion to cover risk factors and events that may have occurred as of the evaluation date that have not been reflected in the risk measures utilized due to inherent limitations in the precision of the estimation process. These risk factors, in addition to past and current events based on facts at the unaudited consolidated balance sheet date and realistic courses of action that management expects to take, are assessed in determining the level of unallocated allowance. The Allowance was comprised of the following for the periods indicated: Three Months Ended June 30, 2017 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 31,557 $ 19,932 $ 4,532 $ 813 $ 43,541 $ 27,456 $ 8,016 $ 135,847 Charge-offs (75) — — (146) — (5,251) — (5,472) Recoveries 129 55 — — 150 1,774 — 2,108 Increase (decrease) in Provision 1,730 24 939 190 683 3,924 (3,090) 4,400 Balance at end of period $ 33,341 $ 20,011 $ 5,471 $ 857 $ 44,374 $ 27,903 $ 4,926 $ 136,883 Six Months Ended June 30, 2017 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 33,129 $ 18,448 $ 4,513 $ 847 $ 43,436 $ 28,388 $ 6,733 $ 135,494 Charge-offs (930) — — (146) (22) (10,823) — (11,921) Recoveries 243 132 — — 471 3,564 — 4,410 Increase (decrease) in Provision 899 1,431 958 156 489 6,774 (1,807) 8,900 Balance at end of period $ 33,341 $ 20,011 $ 5,471 $ 857 $ 44,374 $ 27,903 $ 4,926 $ 136,883 Three Months Ended June 30, 2016 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 35,027 $ 18,504 $ 4,514 $ 807 $ 45,638 $ 27,923 $ 4,741 $ 137,154 Charge-offs (52) — — — (456) (4,295) — (4,803) Recoveries 19 47 — 1 460 1,582 — 2,109 Increase (decrease) in Provision 798 (291) 122 (28) 810 3,176 (2,687) 1,900 Balance at end of period $ 35,792 $ 18,260 $ 4,636 $ 780 $ 46,452 $ 28,386 $ 2,054 $ 136,360 Six Months Ended June 30, 2016 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 34,025 $ 18,489 $ 3,793 $ 888 $ 46,099 $ 28,385 $ 3,805 $ 135,484 Charge-offs (138) — — — (528) (8,501) — (9,167) Recoveries 222 3,246 — 1 766 3,208 — 7,443 Increase (decrease) in Provision 1,683 (3,475) 843 (109) 115 5,294 (1,751) 2,600 Balance at end of period $ 35,792 $ 18,260 $ 4,636 $ 780 $ 46,452 $ 28,386 $ 2,054 $ 136,360 The disaggregation of the Allowance and recorded investment in loans by impairment methodology as of June 30, 2017 and December 31, 2016 were as follows: June 30, 2017 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Individually evaluated for impairment $ 5 $ 7 $ — $ — $ 653 $ — $ — $ 665 Collectively evaluated for impairment 33,336 20,004 5,471 857 43,721 27,903 4,926 136,218 Balance at end of period $ 33,341 $ 20,011 $ 5,471 $ 857 $ 44,374 $ 27,903 $ 4,926 $ 136,883 Loans and leases: Individually evaluated for impairment $ 19,285 $ 9,263 $ — $ — $ 17,278 $ — $ — $ 45,826 Collectively evaluated for impairment 3,311,807 2,536,216 555,794 180,676 3,904,603 1,527,470 — 12,016,566 Balance at end of period $ 3,331,092 $ 2,545,479 $ 555,794 $ 180,676 $ 3,921,881 $ 1,527,470 $ — $ 12,062,392 December 31, 2016 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Individually evaluated for impairment $ 380 $ 7 $ — $ — $ 705 $ — $ — $ 1,092 Collectively evaluated for impairment 32,749 18,441 4,513 847 42,731 28,388 6,733 134,402 Balance at end of period $ 33,129 $ 18,448 $ 4,513 $ 847 $ 43,436 $ 28,388 $ 6,733 $ 135,494 Loans and leases: Individually evaluated for impairment $ 27,572 $ 12,545 $ — $ 153 $ 19,158 $ — $ — $ 59,428 Collectively evaluated for impairment 3,212,028 2,330,950 450,012 179,887 3,777,301 1,510,772 — 11,460,950 Balance at end of period $ 3,239,600 $ 2,343,495 $ 450,012 $ 180,040 $ 3,796,459 $ 1,510,772 $ — $ 11,520,378 Credit Quality The Company performs an internal loan review and grading on an ongoing basis. The review provides management with periodic information as to the quality of the loan portfolio and effectiveness of the Company’s lending policies and procedures. The objective of the loan review and grading procedures is to identify, in a timely manner, existing or emerging credit quality problems so that appropriate steps can be initiated to avoid or minimize future losses. Loans subject to grading include: commercial and industrial loans, commercial and standby letters of credit, installment loans to businesses or individuals for business and commercial purposes, commercial real estate loans, overdraft lines of credit, commercial credit cards, and other credits as may be determined. Loans which are not subject to grading include loans that are 100% sold with no recourse to the Company, consumer installment loans, indirect automobile loans, consumer credit cards, business credit cards, home equity lines of credit and residential mortgage loans. Residential and consumer loans are underwritten primarily on the basis of credit bureau scores, debt-service-to-income ratios, and collateral quality and loan to value ratios. A credit risk rating system is used to determine loan grade and is based on borrower credit risk and transactional risk. The loan grading process is a mechanism used to determine the risk of a particular borrower and is based on the following eight factors of a borrower: character, earnings and operating cash flow, asset and liability structure, debt capacity, financial reporting, management and controls, borrowing entity, and industry and operating environment. Pass – “Pass” (uncriticized loans) and leases, are not considered to carry greater than normal risk. The borrower has the apparent ability to satisfy obligations to the Company, and therefore no loss in ultimate collection is anticipated. Special Mention – Loans and leases that have potential weaknesses deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for assets or in the institution’s credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Substandard – Loans and leases that are inadequately protected by the current financial condition and paying capacity of the obligor or by any collateral pledged. Loans and leases so classified must have a well-defined weakness or weaknesses that jeopardize the collection of the debt. They are characterized by the distinct possibility that the bank may sustain some loss if the deficiencies are not corrected. Doubtful – Loans and leases that have weaknesses found in substandard borrowers with the added provision that the weaknesses make collection of debt in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Loss – Loans and leases classified as loss are considered uncollectible and of such little value that their continuance as an asset is not warranted. This classification does not mean that the loan or lease has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future. The credit risk profiles by internally assigned grade for loans and leases as of June 30, 2017 and December 31, 2016 were as follows: June 30, 2017 Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Total Grade: Pass $ 3,227,317 $ 2,501,783 $ 548,893 $ 179,906 $ 6,457,899 Special mention 42,178 22,351 5,821 589 70,939 Substandard 60,230 21,345 1,080 181 82,836 Doubtful 1,367 — — — 1,367 Total $ 3,331,092 $ 2,545,479 $ 555,794 $ 180,676 $ 6,613,041 December 31, 2016 Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Total Grade: Pass $ 3,166,304 $ 2,298,839 $ 445,149 $ 179,345 $ 6,089,637 Special mention 41,719 23,859 3,789 368 69,735 Substandard 29,811 20,797 1,074 174 51,856 Doubtful 1,766 — — 153 1,919 Total $ 3,239,600 $ 2,343,495 $ 450,012 $ 180,040 $ 6,213,147 There were no loans and leases graded as Loss as of June 30, 2017 and December 31, 2016. The credit risk profiles based on payment activity for loans and leases that were not subject to loan grading as of June 30, 2017 and December 31, 2016 were as follows: June 30, 2017 (dollars in thousands) Residential Consumer Consumer - Auto Credit Cards Total Performing $ 3,907,274 $ 230,121 $ 951,329 $ 326,581 $ 5,415,305 Non-performing and delinquent 14,607 3,197 12,848 3,394 34,046 Total $ 3,921,881 $ 233,318 $ 964,177 $ 329,975 $ 5,449,351 December 31, 2016 (dollars in thousands) Residential Consumer Consumer - Auto Credit Cards Total Performing $ 3,778,070 $ 240,185 $ 906,829 $ 340,801 $ 5,265,885 Non-performing and delinquent 18,389 3,327 15,927 3,703 41,346 Total $ 3,796,459 $ 243,512 $ 922,756 $ 344,504 $ 5,307,231 Impaired and Nonaccrual Loans and Leases The Company evaluates certain loans and leases individually for impairment. A loan or lease is considered to be impaired when it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan or lease. An allowance for impaired commercial loans, including commercial real estate and construction loans, is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the estimated fair value of the collateral, less any selling costs, if the loan is collateral dependent. An allowance for impaired residential loans is measured based on the estimated fair value of the collateral, less any selling costs. Management exercises significant judgment in developing these estimates. The Company generally places a loan on nonaccrual status when management believes that collection of principal or interest has become doubtful or when a loan or lease becomes 90 days past due as to principal or interest, unless it is well secured and in the process of collection. It is the Company’s policy to charge off a loan when the facts indicate that the loan is considered uncollectible. The aging analyses of past due loans and leases as of June 30, 2017 and December 31, 2016 were as follows: June 30, 2017 Accruing Loans and Leases Greater Total Non Than or Total Accruing 30-59 60-89 Equal to Total Accruing Loans Days Days 90 Days Past Loans and and Total (dollars in thousands) Past Due Past Due Past Due Due Current Leases Leases Outstanding Commercial and industrial $ 791 $ 185 $ 1,275 $ 2,251 $ 3,326,686 $ 3,328,937 $ 2,155 $ 3,331,092 Commercial real estate 3,190 — — 3,190 2,542,289 2,545,479 — 2,545,479 Construction 86 84 350 520 555,274 555,794 — 555,794 Lease financing — — — — 180,676 180,676 — 180,676 Residential 6,334 1,161 1,543 9,038 3,907,274 3,916,312 5,569 3,921,881 Consumer 14,397 3,169 1,873 19,439 1,508,031 1,527,470 — 1,527,470 Total $ 24,798 $ 4,599 $ 5,041 $ 34,438 $ 12,020,230 $ 12,054,668 $ 7,724 $ 12,062,392 December 31, 2016 Accruing Loans and Leases Greater Total Non Than or Total Accruing 30-59 60-89 Equal to Total Accruing Loans Days Days 90 Days Past Loans and and Total (dollars in thousands) Past Due Past Due Past Due Due Current Leases Leases Outstanding Commercial and industrial $ 720 $ 163 $ 449 $ 1,332 $ 3,235,538 $ 3,236,870 $ 2,730 $ 3,239,600 Commercial real estate 475 — — 475 2,343,020 2,343,495 — 2,343,495 Construction — — — — 450,012 450,012 — 450,012 Lease financing — — 83 83 179,804 179,887 153 180,040 Residential 9,907 1,069 866 11,842 3,778,070 3,789,912 6,547 3,796,459 Consumer 17,626 3,460 1,870 22,956 1,487,816 1,510,772 — 1,510,772 Total $ 28,728 $ 4,692 $ 3,268 $ 36,688 $ 11,474,260 $ 11,510,948 $ 9,430 $ 11,520,378 The total carrying amounts and the total unpaid principal balances of impaired loans and leases as of June 30, 2017 and December 31, 2016 were as follows: June 30, 2017 Unpaid Recorded Principal Related (dollars in thousands) Investment Balance Allowance Impaired loans with no related allowance recorded: Commercial and industrial $ 19,129 $ 19,861 $ — Commercial real estate 8,348 8,348 — Residential 8,300 8,908 — Total $ 35,777 $ 37,117 $ — Impaired loans with a related allowance recorded: Commercial and industrial $ 156 $ 156 $ 5 Commercial real estate 915 915 7 Residential 8,978 9,259 653 Total $ 10,049 $ 10,330 $ 665 Total impaired loans: Commercial and industrial $ 19,285 $ 20,017 $ 5 Commercial real estate 9,263 9,263 7 Residential 17,278 18,167 653 Total $ 45,826 $ 47,447 $ 665 December 31, 2016 Unpaid Recorded Principal Related (dollars in thousands) Investment Balance Allowance Impaired loans with no related allowance recorded: Commercial and industrial $ 22,404 $ 22,608 $ — Commercial real estate 11,598 11,598 — Lease financing 153 153 — Residential 9,608 10,628 — Total $ 43,763 $ 44,987 $ — Impaired loans with a related allowance recorded: Commercial and industrial $ 5,168 $ 5,624 $ 380 Commercial real estate 947 947 7 Residential 9,550 9,831 705 Total $ 15,665 $ 16,402 $ 1,092 Total impaired loans: Commercial and industrial $ 27,572 $ 28,232 $ 380 Commercial real estate 12,545 12,545 7 Lease financing 153 153 — Residential 19,158 20,459 705 Total $ 59,428 $ 61,389 $ 1,092 The following tables provide information with respect to the Company’s average balances, and of interest income recognized from, impaired loans for the three and six months ended June 30, 2017 and 2016: Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Average Interest Average Interest Recorded Income Recorded Income (dollars in thousands) Investment Recognized Investment Recognized Impaired loans with no related allowance recorded: Commercial and industrial $ 20,068 $ 209 $ 20,847 $ 438 Commercial real estate 9,866 117 10,443 246 Lease financing 77 — 102 — Residential 8,187 144 8,661 280 Total $ 38,198 $ 470 $ 40,053 $ 964 Impaired loans with a related allowance recorded: Commercial and industrial $ 3,697 $ 3 $ 4,187 $ 50 Commercial real estate 924 11 932 22 Residential 9,140 95 9,276 189 Total $ 13,761 $ 109 $ 14,395 $ 261 Total impaired loans: Commercial and industrial $ 23,765 $ 212 $ 25,034 $ 488 Commercial real estate 10,790 128 11,375 268 Lease financing 77 — 102 — Residential 17,327 239 17,937 469 Total $ 51,959 $ 579 $ 54,448 $ 1,225 Three Months Ended Six Months Ended June 30, 2016 June 30, 2016 Average Interest Average Interest Recorded Income Recorded Income (dollars in thousands) Investment Recognized Investment Recognized Impaired loans with no related allowance recorded: Commercial and industrial $ 30,443 $ 338 $ 25,577 $ 651 Commercial real estate 8,397 140 7,527 284 Construction 283 — 188 8 Lease financing 176 — 177 — Residential 13,626 104 14,166 235 Total $ 52,925 $ 582 $ 47,635 $ 1,178 Impaired loans with a related allowance recorded: Commercial and industrial $ 892 $ — $ 595 $ — Residential 8,857 85 8,267 176 Total $ 9,749 $ 85 $ 8,862 $ 176 Total impaired loans: Commercial and industrial $ 31,335 $ 338 $ 26,172 $ 651 Commercial real estate 8,397 140 7,527 284 Construction 283 — 188 8 Lease financing 176 — 177 — Residential 22,483 189 22,433 411 Total $ 62,674 $ 667 $ 56,497 $ 1,354 Modifications Commercial and industrial loans modified in a troubled debt restructuring (“TDR”) may involve temporary interest-only payments, term extensions, and converting revolving credit lines to term loans. Additional collateral, a co-borrower, or a guarantor may be requested. Modifications of commercial real estate and construction loans in a TDR may involve reducing the interest rate for the remaining term of the loan, extending the maturity date at an interest rate lower than the current market rate for new debt with similar risk, or substituting or adding a new borrower or guarantor. Modifications of construction loans in a TDR may also involve extending the interest-only payment period. Interest continues to accrue on the missed payments and as a result, the effective yield on the lease remains unchanged. As the forbearance period usually involves an insignificant payment delay, lease financing modifications typically do not meet the reporting criteria for a TDR. Residential real estate loans modified in a TDR may be comprised of loans where monthly payments are lowered to accommodate the borrowers' financial needs for a period of time, normally two years. Generally, consumer loans are not classified as a TDR as they are normally charged off upon reaching a predetermined delinquency status that ranges from 120 to 180 days and varies by product type. Loans modified in a TDR may already be on nonaccrual status and in some cases partial charge-offs may have already been taken against the outstanding loan balance. Loans modified in a TDR are evaluated for impairment. As a result, this may have a financial effect of increasing the specific Allowance associated with the loan. An Allowance for impaired commercial loans, including commercial real estate and construction loans, that have been modified in a TDR is measured based on the present value of expected future cash flows discounted at the loan's effective interest rate, the loan's observable market price, or the estimated fair value of the collateral, less any selling costs, if the loan is collateral dependent. An Allowance for impaired residential loans that have been modified in a TDR is measured based on the estimated fair value of the collateral, less any selling costs. Management exercises significant judgment in developing these estimates. The following presents, by class, information related to loans modified in a TDR during the three and six months ended June 30, 2017 and 2016: Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Number of Recorded Related Number of Recorded Related (dollars in thousands) Contracts Investment (1) Allowance Contracts Investment (1) Allowance Commercial and industrial — $ — $ — 1 $ 1,150 $ — Residential 1 310 10 2 663 21 Total 1 $ 310 $ 10 3 $ 1,813 $ 21 Three Months Ended Six Months Ended June 30, 2016 June 30, 2016 Number of Recorded Related Number of Recorded Related (dollars in thousands) Contracts Investment (1) Allowance Contracts Investment (1) Allowance Commercial and industrial 2 $ 7,857 $ — 4 $ 15,953 $ — Commercial real estate 2 5,538 — 2 5,538 — Residential 2 1,195 — 8 3,589 63 Total 6 $ 14,590 $ — 14 $ 25,080 $ 63 (1) The recorded investment balances reflect all partial paydowns and charge-offs since the modification date and do not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. The above loans were modified in a TDR through temporary interest-only payments, reduced payments, or below-market interest rates. The Company had total remaining loan and lease commitments including standby letters of credit of $5.2 billion as of June 30, 2017 and $5.1 billion as of December 31, 2016. Of the $5.2 billion at June 30, 2017, there were commitments of $1.5 million related to borrowers who had loan terms modified in a TDR. Of the $5.1 billion at December 31, 2016, there were commitments of $6.9 million related to borrowers who had loan terms modified in a TDR. The following table presents, by class, loans modified in TDRs that have defaulted in the current period within 12 months of their permanent modification date for the periods indicated. The Company is reporting these defaulted TDRs based on a payment default definition of 30 days past due: Three Months Ended Six Months Ended Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 June 30, 2016 June 30, 2016 Number of Recorded Number of Recorded Number of Recorded Number of Recorded (dollars in thousands) Contracts Investment (1) Contracts Investment (1) Contracts Investment (1) Contracts Investment (1) Commercial and industrial (2) 1 $ 2,496 1 $ 2,496 — $ — 1 $ 2,496 Commercial real estate (3) 1 1,393 1 1,393 — — — — Residential (4) — — 1 510 — — — — Total 2 $ 3,889 3 $ 4,399 — $ — 1 $ 2,496 (1) The recorded investment balances reflect all partial paydowns and charge-offs since the modification date and do not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. (2) For the three months ended June 30, 2017 and six months ended June 30, 2017 and 2016, the maturity date for the commercial and industrial loan that subsequently defaulted was extended. (3) For the three and six months ended June 30, 2017, the commercial real estate loan that subsequently defaulted was extended. (4) For the six months ended June 30, 2017, the residential real estate loan that subsequently defaulted was modified for interest-only payments. Foreclosure Proceedings There were no residential mortgage loans collateralized by real estate property that were modified in a TDR that were in the process of foreclosure at June 30, 2017 and one residential real estate loan of $0.5 million that was in process of foreclosure at December 31, 2016. Foreclosed Property Residential real estate property held from one foreclosed TDR of a residential mortgage loan included in other real estate owned and repossessed personal property shown in the unaudited consolidated balance sheets was $0.3 million as of both June 30, 2017 and December 31, 2016. |
Transfers of Financial Assets
Transfers of Financial Assets | 6 Months Ended |
Jun. 30, 2017 | |
Transfers of Financial Assets | |
Transfers of Financial Assets | 5. Transfers of Financial Assets The Company’s transfers of financial assets with continuing interest may include pledges of collateral to secure public deposits and repurchase agreements, FHLB and FRB borrowing capacity, automated clearing house (“ACH”) transactions and interest rate swaps. For public deposits and repurchase agreements, the Company enters into bilateral agreements with the entity to pledge investment securities as collateral in the event of default. The right of setoff for a repurchase agreement resembles a secured borrowing, whereby the collateral pledged by the Company would be used to settle the fair value of the repurchase agreement should the Company be in default. The counterparty has the right to sell or repledge the investment securities. The Company is required by the counterparty to maintain adequate collateral levels. In the event the collateral fair value falls below stipulated levels, the Company will pledge additional investment securities. For transfers of assets with the FHLB and the FRB, the Company enters into bilateral agreements to pledge loans and investment securities as collateral to secure borrowing capacity. For ACH transactions, the Company enters into bilateral agreements to collateralize possible daylight overdrafts. For interest rate swaps, the Company enters into bilateral agreements to pledge collateral when either party is in a negative fair value position to mitigate counterparty credit risk. Counterparties to ACH transactions, certain interest rate swaps, the FHLB and the FRB do not have the right to sell or repledge the collateral. The carrying amounts of the assets pledged as collateral to secure public deposits, borrowing arrangements and other transactions as of June 30, 2017 and December 31, 2016 were as follows: (dollars in thousands) June 30, 2017 December 31, 2016 Public deposits $ 2,728,505 $ 2,521,761 Federal Home Loan Bank 2,260,995 2,097,233 Federal Reserve Bank 903,335 935,672 Repurchase agreements — 10,066 ACH transactions 151,003 152,394 Interest rate swaps 35,153 30,399 Total $ 6,078,991 $ 5,747,525 As the Company did not enter into reverse repurchase agreements, no collateral was accepted as of June 30, 2017 and December 31, 2016. In addition, no debt was extinguished by in-substance defeasance. At June 30, 2017, the Company had $1.8 billion and $685.9 million in lines of credit available from the FHLB and the FRB, respectively. None of the lines available were drawn upon as of June 30, 2017. As of June 30, 2017, the Company did not have any repurchase agreements. A disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged as of December 31, 2016 was as follows: December 31, 2016 Remaining Contractual Maturity of the Agreements Up to Greater than (dollars in thousands) 30 days 30-90 days 90 days Total Government agency collateralized mortgage obligations $ 1,200 $ — $ 4,951 $ 6,151 Government-sponsored enterprises mortgage-backed securities — 2,000 1,000 3,000 Gross amount of recognized liabilities for repurchase agreements $ 1,200 $ 2,000 $ 5,951 $ 9,151 |
Deposits
Deposits | 6 Months Ended |
Jun. 30, 2017 | |
Deposits | |
Deposits | 6. Deposits As of June 30, 2017 and December 31, 2016, deposits were categorized as interest-bearing or noninterest-bearing as follows: (dollars in thousands) June 30, 2017 December 31, 2016 U.S.: Interest-bearing $ 10,903,294 $ 10,129,958 Noninterest-bearing 5,227,404 5,399,212 Foreign: Interest-bearing 677,370 671,957 Noninterest-bearing 644,194 593,405 Total deposits $ 17,452,262 $ 16,794,532 The following table presents the maturity distribution of time certificates of deposit as of June 30, 2017: Under $250,000 (dollars in thousands) $250,000 or More Total Three months or less $ 236,404 $ 1,714,290 $ 1,950,694 Over three through six months 269,544 549,241 818,785 Over six through twelve months 267,980 394,465 662,445 One to two years 126,118 83,882 210,000 Two to three years 124,299 47,956 172,255 Three to four years 92,840 49,420 142,260 Four to five years 81,989 29,613 111,602 Thereafter 18 — 18 Total $ 1,199,192 $ 2,868,867 $ 4,068,059 Time certificates of deposit in denominations of $250,000 or more, in the aggregate, were $2.9 billion and $2.5 billion as of June 30, 2017 and December 31, 2016, respectively. Overdrawn deposit accounts were classified as loans and totaled $1.7 million and $1.5 million as of June 30, 2017 and December 31, 2016, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 6 Months Ended |
Jun. 30, 2017 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | 7. Accumulated Other Comprehensive Loss Accumulated other comprehensive loss is defined as the revenues, expenses, gains and losses that are included in comprehensive income but excluded from net income. The Company’s significant items of accumulated other comprehensive loss are pension and other benefits, net unrealized gains or losses on investment securities and net unrealized gains or losses on cash flow derivative hedges. Changes in accumulated other comprehensive loss for the three and six months ended June 30, 2017 and 2016 are presented below: Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at March 31, 2017 $ (143,296) $ 56,604 $ (86,692) Three months ended June 30, 2017 Investment securities: Unrealized net gains arising during the period 31,215 (12,330) 18,885 Net change in unrealized gains on investment securities 31,215 (12,330) 18,885 Cash flow derivative hedges: Unrealized net gains on cash flow derivative hedges arising during the period 258 (102) 156 Net change in unrealized gains on cash flow derivative hedges 258 (102) 156 Other comprehensive income 31,473 (12,432) 19,041 Accumulated other comprehensive loss at June 30, 2017 $ (111,823) $ 44,172 $ (67,651) Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2016 $ (145,472) $ 57,461 $ (88,011) Six months ended June 30, 2017 Investment securities: Unrealized net gains arising during the period 32,793 (12,951) 19,842 Net change in unrealized gains on investment securities 32,793 (12,951) 19,842 Cash flow derivative hedges: Unrealized net gains on cash flow derivative hedges arising during the period 856 (338) 518 Net change in unrealized gains on cash flow derivative hedges 856 (338) 518 Other comprehensive income 33,649 (13,289) 20,360 Accumulated other comprehensive loss at June 30, 2017 $ (111,823) $ 44,172 $ (67,651) Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at March 31, 2016 $ (30,369) $ 11,996 $ (18,373) Three months ended June 30, 2016 Pension and other benefits: Change due to Reorganization Transactions (78) 32 (46) Net change in pension and other benefits (78) 32 (46) Investment securities: Unrealized net gains arising during the period 21,605 (8,535) 13,070 Reclassification of net gains to net income: Investment securities gains, net (3) — (3) Net change in unrealized gains on investment securities 21,602 (8,535) 13,067 Cash flow derivative hedges: Unrealized net gains on cash flow derivative hedges arising during the period 201 (76) 125 Net change in unrealized gains on cash flow derivative hedges 201 (76) 125 Other comprehensive income 21,725 (8,579) 13,146 Accumulated other comprehensive loss at June 30, 2016 $ (8,644) $ 3,417 $ (5,227) Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2015 $ (84,722) $ 33,463 $ (51,259) Six months ended June 30, 2016 Pension and other benefits: Change due to Reorganization Transactions (78) 32 (46) Net change in pension and other benefits (78) 32 (46) Investment securities: Unrealized net gains arising during the period 102,515 (40,493) 62,022 Reclassification of net gains to net income: Investment securities gains, net (25,731) 10,164 (15,567) Net change in unrealized gains on investment securities 76,784 (30,329) 46,455 Cash flow derivative hedges: Unrealized net losses on cash flow derivative hedges arising during the period (628) 251 (377) Net change in unrealized losses on cash flow derivative hedges (628) 251 (377) Other comprehensive income 76,078 (30,046) 46,032 Accumulated other comprehensive loss at June 30, 2016 $ (8,644) $ 3,417 $ (5,227) The following table summarizes changes in accumulated other comprehensive loss, net of tax, for the periods indicated: Unrealized Total Pensions Unrealized Gains Accumulated and Gains (Losses) (Losses) on Other Other on Investment Cash Flow Comprehensive (dollars in thousands) Benefits Securities Derivative Hedges Loss Three Months Ended June 30, 2017 Balance at beginning of period $ (30,237) $ (59,001) $ 2,546 $ (86,692) Other comprehensive income — 18,885 156 19,041 Balance at end of period $ (30,237) $ (40,116) $ 2,702 $ (67,651) Six Months Ended June 30, 2017 Balance at beginning of period $ (30,237) $ (59,958) $ 2,184 $ (88,011) Other comprehensive income — 19,842 518 20,360 Balance at end of period $ (30,237) $ (40,116) $ 2,702 $ (67,651) Three Months Ended June 30, 2016 Balance at beginning of period $ (26,883) $ 8,282 $ 228 $ (18,373) Other comprehensive (loss) income (46) 13,067 125 13,146 Balance at end of period $ (26,929) $ 21,349 $ 353 $ (5,227) Six Months Ended June 30, 2016 Balance at beginning of period $ (26,883) $ (25,106) $ 730 $ (51,259) Other comprehensive (loss) income (46) 46,455 (377) 46,032 Balance at end of period $ (26,929) $ 21,349 $ 353 $ (5,227) |
Regulatory Capital Requirements
Regulatory Capital Requirements | 6 Months Ended |
Jun. 30, 2017 | |
Regulatory Capital Requirements | |
Regulatory Capital Requirements | 8. Regulatory Capital Requirements Federal and state laws and regulations limit the amount of dividends the Company may declare or pay. The Company depends primarily on dividends from FHB as the source of funds for the Company’s payment of dividends. The Company and the Bank are subject to various regulatory capital requirements imposed by 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 the Company’s and the Bank’s operating activities and financial condition. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of its assets and certain off-balance-sheet items. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios of Common Equity Tier 1 (“CET1”), Tier 1 and total capital to risk-weighted assets, as well as a minimum leverage ratio. The table below sets forth those ratios at June 30, 2017 and December 31, 2016: First Hawaiian, Inc. First Hawaiian Minimum Well- and Subsidiary Bank Capital Capitalized (dollars in thousands) Amount Ratio Amount Ratio Ratio (1) Ratio (1) June 30, 2017: Common equity tier 1 capital to risk-weighted assets $ 1,624,761 12.73 % $ 1,615,232 12.67 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,624,761 12.73 % 1,615,232 12.67 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,762,244 13.81 % 1,752,715 13.75 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,624,761 8.70 % 1,615,232 8.66 % 4.00 % 5.00 % December 31, 2016: Common equity tier 1 capital to risk-weighted assets $ 1,569,004 12.75 % $ 1,533,056 12.51 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,569,004 12.75 % 1,533,063 12.51 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,705,098 13.85 % 1,669,157 13.62 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,569,004 8.36 % 1,533,063 8.19 % 4.00 % 5.00 % (1) As defined by the regulations issued by the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation (“FDIC”). A new capital conservation buffer, comprised of common equity Tier 1 capital, was established above the regulatory minimum capital requirements. This capital conservation buffer was phased in beginning January 1, 2016 at 0.625% of risk-weighted assets and will increase each subsequent year by an additional 0.625% until reaching its final level of 2.5% on January 1, 2019. As of June 30, 2017, under the bank regulatory capital guidelines, the Company and Bank were both classified as well-capitalized. Management is not aware of any conditions or events that have occurred since June 30, 2017, to change the capital adequacy category of the Company or the Bank. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2017 | |
Income Taxes | |
Income Taxes | 9. Income Taxes The Company’s effective tax rate was 37.12% and 36.52% for the three months ended June 30, 2017 and 2016, respectively, and 37.01% and 37.13% for the six months ended June 30, 2017 and 2016, respectively. The Company is subject to examination by the Internal Revenue Service (“IRS”) and tax authorities in states in which the Company has significant business operations. The tax years under examination and open for examination vary by jurisdiction. There are currently no federal examinations under way; however, refund claims and tax returns for certain years are being reviewed by state jurisdictions. No material unanticipated adjustments were made by the IRS in the years most recently examined and the Company does not expect significant audit developments in the next 12 months. The Company’s income tax returns for 2013 and subsequent tax years generally remain subject to examination by U.S. federal and state taxing authorities, and 2013 and subsequent years are subject to examination by foreign jurisdictions. A reconciliation of the amount of unrecognized tax benefits is as follows for the six months ended June 30, 2017 and 2016: Six Months Ended June 30, 2017 2016 Interest Interest and and (dollars in thousands) Tax Penalties Total Tax Penalties Total Balance at January 1, $ 127,085 $ 9,965 $ 137,050 $ 5,903 $ 2,935 $ 8,838 Additions for current year tax positions 1,478 — 1,478 6,297 1,075 7,372 Additions for Reorganization Transactions — 226 226 115,877 5,459 121,336 Additions for prior years' tax positions: Accrual of interest and penalties — 209 209 — 67 67 Reductions for prior years' tax positions: Expiration of statute of limitations (254) (101) (355) (353) (144) (497) Balance at June 30, $ 128,309 $ 10,299 $ 138,608 $ 127,724 $ 9,392 $ 137,116 Included in the balance of unrecognized tax benefits for both the six months ended June 30, 2017 and 2016, was $11.0 million of unrecognized tax benefits that, if recognized, would impact the effective tax rate. In connection with the Reorganization Transactions discussed below, the Company recorded interest and penalties of $0.2 million for the six months ended June 30, 2017 and unrecognized tax benefits and interest and penalties of $115.9 million and $5.5 million, respectively, for the six months ended June 30, 2016. Included in the balance of the unrecognized tax benefits as of June 30, 2017 was $93.9 million attributable to tax refund claims with respect to tax years 2005 through 2012 in the State of California. Such refund claims were filed by the Company in 2015, on behalf of the Company and its affiliates, including BOW, concerning the determination of taxes for which no benefit is currently recognized. It is reasonably possible that the amount of unrecognized tax benefits could decrease within the next 12 months by as much as $107.1 million of taxes and $5.2 million of accrued interest and penalties as a result of settlements and the expiration of the statute of limitations in various states. The Company recognizes interest and penalties attributable to both unrecognized tax benefits and undisputed tax adjustments in the provision for income taxes. For the six months ended June 30, 2017 and 2016, the Company recorded $0.4 million and $0.2 million, respectively, of net expense attributable to interest and penalties. The Company had a liability of $12.5 million and $12.1 million as of June 30, 2017 and December 31, 2016, respectively, accrued for interest and penalties, of which $10.3 million and $10.0 million as of June 30, 2017 and December 31, 2016, respectively, were attributable to unrecognized tax benefits and the remainder was attributable to tax adjustments which are not expected to be in dispute. Prior to the Reorganization Transactions, the Company filed consolidated U.S. Federal and combined state tax returns that incorporated the tax receivables and unrecognized tax benefits of FHB and BOW. The consummation of the Reorganization Transactions did not relieve the Company of the pre-Reorganization Transactions tax receivables and unrecognized tax benefits recognized by BOW that were included in the Company's consolidated and combined tax returns. As a result, on April 1, 2016, the Company recorded $72.8 million related to current tax receivables, $116.6 million related to unrecognized tax benefits, and an indemnification payable of $28.6 million. Additionally, in connection with the Reorganization Transactions, the Company incurred certain tax-related liabilities related to the distribution of its interest in BWHI amounting to $95.4 million. The amount necessary to pay the distribution taxes (net of the expected federal tax benefit of $33.4 million) was paid by BNPP to the Company on April 1, 2016. The Company expects that any future refunds or adjustments to such taxes will be reimbursed to, or funded by, BWHI or its affiliates pursuant to a tax sharing agreement entered into on April 1, 2016 and pursuant to certain tax allocation agreements entered into among the parties. Accordingly, the assumption of the pre-Reorganization Transactions tax receivables, unrecognized tax benefits and distribution tax liabilities and the offsetting indemnification receivables or payables were reflected as equity contributions and distributions on April 1, 2016. If there are any future adjustments to the indemnified tax receivables or unrecognized tax benefits, an offsetting adjustment to the indemnification receivables or payables will be recorded to the provision for income taxes and other noninterest income or expense. |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Jun. 30, 2017 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | 10. Derivative Financial Instruments The Company enters into derivative contracts primarily to manage its interest rate risk, as well as for customer accommodation purposes. Derivatives used for risk management purposes consist of interest rate swaps that are designated as either a fair value hedge or a cash flow hedge. The derivatives are recognized on the unaudited consolidated balance sheets as either assets or liabilities at fair value. Derivatives entered into for customer accommodation purposes consist of interest rate lock commitments, various free-standing interest rate derivative products and foreign exchange contracts. The Company is party to master netting arrangements with its financial institution counterparties; however, the Company does not offset assets and liabilities under these arrangements for financial statement presentation purposes. The following table summarizes notional amounts and fair values of derivatives held by the Company as of June 30, 2017 and December 31, 2016: June 30, 2017 December 31, 2016 Fair Value Fair Value Notional Asset Liability Notional Asset Liability (dollars in thousands) Amount Derivatives (1) Derivatives (2) Amount Derivatives (1) Derivatives (2) Derivatives designated as hedging instruments: Interest rate swaps $ 196,451 $ — $ (4,149) $ 200,504 $ — $ (5,296) Derivatives not designated as hedging instruments: Interest rate swaps 1,611,148 19,581 (14,935) 1,297,101 15,982 (18,299) Funding swap 40,017 — (6,493) 37,143 — (7,460) Foreign exchange contracts 3,376 79 — 3,664 — (147) (1) The positive fair value of derivative assets is included in other assets. (2) The negative fair value of derivative liabilities is included in other liabilities. As of June 30, 2017, the Company pledged $23.9 million in financial instruments and $11.3 million in cash as collateral for interest rate swaps. As of December 31, 2016, the Company pledged $12.1 million in financial instruments and $18.3 million in cash as collateral for interest rate swaps. Fair Value Hedges To manage the risk related to the Company’s net interest margin, interest rate swaps are utilized to hedge certain fixed-rate loans. These swaps have maturity, amortization and prepayment features that correspond to the loans hedged, and are designated and qualify as fair value hedges. Any gain or loss on the swaps, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, is recognized in current period earnings. At June 30, 2017, the Company carried interest rate swaps with notional amounts totaling $46.5 million with a positive fair value of nil and fair value losses of $1.2 million that were categorized as fair value hedges for commercial and industrial loans and commercial real estate loans. The Company received 6-month London Interbank Offered Rate (“LIBOR”) and paid fixed rates ranging from 2.59% to 5.38%. The swaps mature between 2017 and 2023. At December 31, 2016, the Company carried interest rate swaps with notional amounts totaling $50.5 million with a positive fair value of nil and a negative fair value of $1.5 million that were categorized as fair value hedges for commercial and industrial loans and commercial real estate loans. The following table shows the net gains and losses recognized in income related to derivatives in fair value hedging relationships for the three and six months ended June 30, 2017 and 2016: Three Months Ended Six Months Ended June 30, June 30, (dollars in thousands) 2017 2016 2017 2016 Losses recorded in net interest income $ (171) $ (297) $ (369) $ (694) Gains (losses) recorded in noninterest income: Recognized on derivatives (95) (530) 124 (1,518) Recognized on hedged item 199 467 2 1,546 Net gains (losses) recognized on fair value hedges (ineffective portion) 104 (63) 126 28 Net losses recognized on fair value hedges $ (67) $ (360) $ (243) $ (666) Cash Flow Hedges The Company utilizes short-term fixed-rate interest rate swaps to reduce exposure to interest rates associated with short-term fixed-rate liabilities. The Company enters into interest rate swaps paying fixed rates and receiving LIBOR. The LIBOR index will correspond to the short-term fixed-rate nature of the liabilities being hedged. If interest rates rise, the increase in interest received on the swaps will offset increases in interest costs associated with these liabilities. By hedging with interest rate swaps, the Company minimizes the adverse impact on interest expense associated with increasing rates on short-term liabilities. The interest rate swaps are designated and qualify as cash flow hedges. The effective portion of the gain or loss on the interest rate swaps is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. There were no recognized expenses related to the ineffective portion of the change in fair value of derivatives designated as a cash flow hedge for the three and six months ended June 30, 2017 and 2016. As of June 30, 2017 and December 31, 2016, the Company carried two interest rate swaps with notional amounts totaling $150.0 million, with a negative fair value of $3.0 million as of June 30, 2017 and a negative fair value of $3.8 million as of December 31, 2016, in order to reduce exposure to interest rate increases associated with short-term fixed-rate liabilities. The swaps mature in 2018. The Company received 6-month LIBOR and paid fixed rates ranging from 2.98% to 3.03%. The interest rate swaps designated as cash flow hedges resulted in net interest expense of $0.6 million and $0.8 million during the three months ended June 30, 2017 and 2016, respectively, and $1.3 million and $1.7 million during the six months ended June 30, 2017 and 2016, respectively. The following table summarizes the effect of cash flow hedging relationships for the three and six months ended June 30, 2017 and 2016: Three Months Ended Six Months Ended June 30, June 30, (dollars in thousands) 2017 2016 2017 2016 Pretax gains (losses) recognized in other comprehensive income on derivatives (effective portion) $ 258 $ 201 $ 856 $ (628) There were no gains or losses reclassified from accumulated other comprehensive loss to earnings during the three and six months ended June 30, 2017 and 2016. Free-Standing Derivative Instruments Free-standing derivative instruments include derivative transactions entered into for risk management purposes that do not otherwise qualify for hedge accounting. Interest rate lock commitments issued on residential mortgage loans intended to be held for sale are considered free-standing derivative instruments. Such commitments are stratified by rates and terms and are valued based on market quotes for similar loans. Adjustments, including discounting the historical fallout rate, are then applied to the estimated fair value. The value of the underlying loan is affected primarily by changes in interest rates and the passage of time. However, changes in investor demand, such as concerns about credit risk, can also cause changes in the spread relationships between the underlying loan value and the derivative financial instruments that cannot be hedged. As of June 30, 2017 and December 31, 2016, the Company did not have any loans held for sale. As such, there were no interest rate lock commitment derivative instruments as of June 30, 2017 and December 31, 2016. For the derivatives that are not designated as hedges, changes in fair value are reported in current period earnings. The following table summarizes the impact on pretax earnings of derivatives not designated as hedges, as reported on the unaudited consolidated statements of income for the three and six months ended June 30, 2017 and 2016. Net gains (losses) recognized Three Months Ended Six Months Ended in the consolidated statements June 30, June 30, (dollars in thousands) of income line item 2017 2016 2017 2016 Derivatives Not Designated As Hedging Instruments: Interest rate swaps Other noninterest income $ 100 $ (105) $ 353 $ (395) Funding swap Other noninterest income (35) 19 (32) 19 Foreign exchange contracts Other noninterest income 21 (162) 226 (122) As of June 30, 2017, the Company carried multiple interest rate swaps with notional amounts totaling $1.6 billion, including $1.5 billion related to the Company’s customer swap program, with a positive fair value of $19.6 million and a negative fair value of $14.9 million. The Company received 1-month and 3-month LIBOR and paid fixed rates ranging from 1.23% to 5.33%. The swaps mature between 2018 and 2037. As of December 31, 2016, the Company carried multiple interest rate swaps with notional amounts totaling $1.3 billion, including $1.2 billion related to the Company’s customer swap program, with a positive fair value of $16.0 million and a negative fair value of $18.3 million. The Company received 1-month and 3-month LIBOR and paid fixed rates ranging from 0.77% to 4.90%. The swaps mature between 2018 and 2035. These swaps resulted in net interest expense of $0.2 million and $0.3 million for the three months ended June 30, 2017 and 2016, respectively, and net interest expense of $0.5 million and $0.6 million for the six months ended June 30, 2017 and 2016, respectively. The Company’s customer swap program is designed by offering customers a variable-rate loan that is swapped to fixed-rate through an interest-rate swap. The Company simultaneously executes an offsetting interest-rate swap with a swap dealer. Upfront fees on the dealer swap are recorded in other noninterest income and totaled $1.7 million for both the three months ended June 30, 2017 and 2016, and $4.6 million and $3.7 million for the six months ended June 30, 2017 and 2016, respectively. Interest rate swaps related to the program had asset fair values of $19.6 million and $16.0 million as of June 30, 2017 and December 31, 2016, respectively, and liability fair values of $13.0 million and $16.0 million as of June 30, 2017 and December 31, 2016, respectively. In conjunction with the 2016 sale of Class B restricted shares of common stock issued by Visa, the Company entered into a funding swap agreement with the buyer that requires payment to the buyer in the event Visa reduces each member bank’s Class B conversion ratio to unrestricted Class A common shares. A derivative liability (“Visa derivative”) of $6.5 million and $7.5 million was included in the unaudited consolidated balance sheets at June 30, 2017 and December 31, 2016, respectively, to provide for the fair value of this liability. Under the terms of the funding swap agreement, the Company will make monthly payments to the buyer based on Visa’s Class A stock price and the number of Visa Class B restricted shares that were sold until the date on which the covered litigation is settled. There were no sales of these shares prior to 2016. See “Note 14. Fair Value” for more information. Counterparty Credit Risk By using derivatives, the Company is exposed to counterparty credit risk if counterparties to the derivative contracts do not perform as expected. If a counterparty fails to perform, the Company’s counterparty credit risk is equal to the amount reported as a derivative asset, net of cash or other collateral received, and net of derivatives in a loss position with the same counterparty to the extent master netting arrangements exist. The Company minimizes counterparty credit risk through credit approvals, limits, monitoring procedures, executing master netting arrangements and obtaining collateral, where appropriate. Counterparty credit risk related to derivatives is considered in determining fair value. The Company’s interest rate swap agreements include bilateral collateral agreements with collateral requirements which begin with exposures in excess of $0.5 million. For each counterparty, the Company reviews the interest rate swap collateral daily. Collateral for customer interest rate swap agreements, calculated as the pledged property less loan balance, requires valuation of the property pledged. Counterparty credit risk adjustment of $0.1 million was recognized for both the six months ended June 30, 2017 and 2016. |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingent Liabilities | |
Commitments and Contingent Liabilities | 11. Commitments and Contingent Liabilities Contingencies On January 27, 2017, a purported class action lawsuit was filed by a Bank customer alleging that FHB improperly charges an overdraft fee in circumstances where an account has sufficient funds to cover the transaction at the time a transaction is authorized by the customer but not at the time the transaction is posted, and that this practice constitutes an unjust and deceptive trade practice. The lawsuit further alleges that FHB’s practice of assessing a one-time continuous negative balance overdraft fee on accounts remaining in a negative balance for a seven-day period constitutes a usurious interest charge and an unfair and deceptive trade practice. This lawsuit is similar to lawsuits filed against other financial institutions pertaining to available balance overdraft fee disclosures and continuing negative balance overdraft fees. Because of the many questions of fact and law that may arise in the future, the outcome of this legal proceeding is uncertain at this point. Based on information available to the Company at present, the Company cannot reasonably estimate a range of potential loss, if any, for this action because, among other things, its potential liability depends on whether a class is certified and, if so, the composition and size of any such class, the applicable time period at issue, as well as an assessment of the appropriate measure of damages if the Company were to be found liable. Accordingly, the Company has not recognized any liability associated with this action. Management disputes any wrongdoing and the case is being vigorously defended. In addition to the litigation noted above, various other legal proceedings are pending or threatened against the Company. After consultation with legal counsel, management does not expect that the aggregate liability, if any, resulting from these proceedings would have a material effect on the Company’s consolidated financial position, results of operations or cash flows. Financial Instruments with Off-Balance Sheet Risk The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby and commercial letters of credit which are not reflected in the unaudited consolidated financial statements. Unfunded Commitments to Extend Credit A commitment to extend credit is a legally binding agreement to lend funds to a customer, usually at a stated interest rate and for a specified purpose. Commitments are reported net of participations sold to other institutions. Such commitments have fixed expiration dates and generally require a fee. The extension of a commitment gives rise to credit risk. The actual liquidity requirements or credit risk that the Company will experience is expected to be lower than the contractual amount of commitments to extend credit because a significant portion of those commitments are expected to expire without being drawn upon. Certain commitments are subject to loan agreements containing covenants regarding the financial performance of the customer that must be met before the Company is required to fund the commitment. The Company uses the same credit policies in making commitments to extend credit as it does in extending loans. In addition, the Company manages the potential credit risk in commitments to extend credit by limiting the total amount of arrangements, both by individual customer and in the aggregate, by monitoring the size and expiration structure of these portfolios and by applying the same credit standards maintained for all of its related credit activities. Commitments to extend credit are reported net of participations sold to other institutions of $66.4 million and $94.5 million at June 30, 2017 and December 31, 2016, respectively. Standby and Commercial Letters of Credit Standby letters of credit are issued on behalf of customers in connection with contracts between the customers and third parties. Under standby letters of credit, the Company assures third parties that it will receive the specified funds if customers fail to meet their contractual obligations. The credit risk to the Company arises from its obligation to make payment in the event of a customer’s contractual default. Standby letters of credit are reported net of participations sold to other institutions of $17.5 million and $19.0 million at June 30, 2017 and December 31, 2016, respectively. The Company also had commitments for commercial and similar letters of credit. Commercial letters of credit are issued specifically to facilitate commerce whereby the commitment is typically drawn upon when the underlying transaction between the customer and a third party is consummated. The maximum amount of potential future payments guaranteed by the Company is limited to the contractual amount of these letters. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. Collateral held supports those commitments for which collateral is deemed necessary. The commitments outstanding as of June 30, 2017 have maturities ranging from July 2017 to March 2021. Substantially all fees received from the issuance of such commitments are deferred and amortized on a straight-line basis over the term of the commitment. Financial instruments with off-balance sheet risk at June 30, 2017 and December 31, 2016, respectively, were as follows: June 30, December 31, (dollars in thousands) 2017 2016 Financial instruments whose contract amounts represent credit risk: Commitments to extend credit $ 5,154,215 $ 5,121,811 Standby letters of credit 73,776 60,848 Commercial letters of credit 7,093 6,813 Guarantees The Company sells residential mortgage loans in the secondary market primarily to The Federal National Mortgage Association (“FNMA” or “Fannie Mae”) and The Federal Home Loan Mortgage Corporation (“FHLMC” or “Freddie Mac”) that may potentially require repurchase under certain conditions. This risk is managed through the Company’s underwriting practices. The Company services loans sold to investors and loans originated by other originators under agreements that may include repurchase remedies if certain servicing requirements are not met. This risk is managed through the Company’s quality assurance and monitoring procedures. Management does not anticipate any material losses as a result of these transactions. Foreign Exchange Contracts The Company has forward foreign exchange contracts that represent commitments to purchase or sell foreign currencies at a future date at a specified price. The Company’s utilization of forward foreign exchange contracts is subject to the primary underlying risk of movements in foreign currency exchange rates and to additional counterparty risk should its counterparties fail to meet the terms of their contracts. Forward foreign exchange contracts are utilized to mitigate the Company’s risk to satisfy customer demand for foreign currencies and are not used for trading purposes. See “Note 10. Derivative Financial Instruments” for more information. Reorganization Transactions In connection with the Reorganization Transactions as discussed in Note 1, FHI (formerly BancWest) distributed its interest in BWHI (including BOW) to BNPP so that BWHI was held directly by BNPP. BWHI is now held indirectly by BNPP through its intermediate holding company. As a result of the Reorganization Transactions that occurred on April 1, 2016, various tax or other contingent liabilities could arise related to the business of BOW, or related to the Company’s operations prior to the restructuring when it was known as BancWest, including its then-wholly-owned subsidiary, BOW. The Company is not able to determine the ultimate outcome or estimate the amounts of these contingent liabilities, if any, at this time. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2017 | |
Earnings per Share | |
Earnings per Share | 12. Earnings per Share For the three and six months ended June 30, 2017 and 2016, the Company made no adjustments to net income for the purpose of computing earnings per share and there were no antidilutive securities. For the three and six months ended June 30, 2017 and 2016, the computations of basic and diluted earnings per share were as follows: Three Months Ended Six Months Ended June 30, June 30, (dollars in thousands, except shares and per share amounts) 2017 2016 2017 2016 Numerator: Net income $ 56,895 $ 54,860 $ 113,635 $ 120,391 Denominator: Basic: weighted-average shares outstanding 139,546,615 139,459,620 139,546,174 139,459,620 Add: weighted-average equity-based awards 99,502 — 98,383 — Diluted: weighted-average shares outstanding 139,646,117 139,459,620 139,644,557 139,459,620 Basic earnings per share $ 0.41 $ 0.39 $ 0.81 $ 0.86 Diluted earnings per share $ 0.41 $ 0.39 $ 0.81 $ 0.86 |
Benefit Plans
Benefit Plans | 6 Months Ended |
Jun. 30, 2017 | |
Benefit Plans | |
Benefit Plans | 13. Benefit Plans The following table sets forth the components of net periodic benefit cost for the three and six months ended June 30, 2017 and 2016, recorded as a component of salaries and employee benefits in the unaudited consolidated statements of income: Pension Benefits Other Benefits (dollars in thousands) 2017 2016 2017 2016 Three Months Ended June 30, Service cost $ 157 $ 214 $ 179 $ 192 Interest cost 2,042 2,157 201 211 Expected return on plan assets (1,242) (1,164) — — Prior service credit — — (108) (107) Recognized net actuarial loss 1,999 1,774 — — Total net periodic benefit cost $ 2,956 $ 2,981 $ 272 $ 296 Six Months Ended June 30, Service cost $ 315 $ 429 $ 358 $ 384 Interest cost 4,083 4,314 402 421 Expected return on plan assets (2,484) (2,335) — — Prior service credit — — (215) (214) Recognized net actuarial loss 3,998 3,545 — — Total net periodic benefit cost $ 5,912 $ 5,953 $ 545 $ 591 |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value | |
Fair Value | 14. Fair Value The Company determines the fair values of its financial instruments based on the requirements established in Accounting Standards Codification (“ASC”) 820, Fair Value Measurements , which provides a framework for measuring fair value under GAAP and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 defines fair value as the exit price, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. Fair Value Hierarchy ASC 820 establishes three levels of fair values based on the markets in which the assets or liabilities are traded and the reliability of the assumptions used to determine fair value. The levels are: § Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. § Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets and 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: Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability (“Company-level data”). Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. ASC 820 requires that the Company disclose estimated fair values for certain financial instruments. Financial instruments include such items as investment securities, loans, deposits, interest rate and foreign exchange contracts, interest rate swaps and other instruments as defined by the standard. The Company has an organized and established process for determining and reviewing the fair value of financial instruments reported in the Company’s financial statements. The fair value measurements are reviewed to ensure they are reasonable and in line with market experience in similar asset and liability classes. Additionally, the Company may be required to record at fair value other assets on a nonrecurring basis, such as other real estate owned, other customer relationships, and other intangible assets. These nonrecurring fair value adjustments typically involve the application of lower-of-cost-or-fair-value accounting or write-downs of individual assets. Disclosure of fair values is not required for certain items such as lease financing, obligations for pension and other postretirement benefits, premises and equipment, prepaid expenses, and income tax assets and liabilities. Reasonable comparisons of fair value information with that of other financial institutions cannot necessarily be made because the standard permits many alternative calculation techniques, and numerous assumptions have been used to estimate the Company’s fair values. Valuation Techniques Used in the Fair Value Measurement of Assets and Liabilities Carried at Fair Value For the assets and liabilities measured at fair value on a recurring basis (categorized in the valuation hierarchy table below), the Company applies the following valuation techniques: Available-for-sale securities Available-for-sale debt securities are recorded at fair value on a recurring basis. Fair value measurement is based on quoted prices, including estimates by third-party pricing services, if available. If quoted prices are not available, fair values are measured using proprietary valuation models that utilize market observable parameters from active market makers and inter-dealer brokers whereby securities are valued based upon available market data for securities with similar characteristics. Management reviews the pricing information received from the Company’s third-party pricing service to evaluate the inputs and valuation methodologies used to place securities into the appropriate level of the fair value hierarchy and transfers of securities within the fair value hierarchy are made if necessary. On a monthly basis, management reviews the pricing information received from the third-party pricing service which includes a comparison to non-binding third-party broker quotes, as well as a review of market-related conditions impacting the information provided by the third-party pricing service. Management also identifies investment securities which may have traded in illiquid or inactive markets by identifying instances of a significant decrease in the volume or frequency of trades, relative to historical levels, as well as instances of a significant widening of the bid-ask spread in the brokered markets. As of June 30, 2017 and December 31, 2016, management did not make adjustments to prices provided by the third-party pricing services as a result of illiquid or inactive markets. The Company’s third-party pricing service has also established processes for the Company to submit inquiries regarding quoted prices. Periodically, the Company will challenge the quoted prices provided by the third-party pricing service. The Company’s third-party pricing service will review the inputs to the evaluation in light of the new market data presented by the Company. The Company’s third-party pricing service may then affirm the original quoted price or may update the evaluation on a going forward basis. The Company classifies all available-for-sale securities as Level 2 in the fair value hierarchy. Derivatives Most of the Company’s derivatives are traded in over-the-counter markets where quoted market prices are not readily available. For those derivatives, the Company measures fair value on a recurring basis using proprietary valuation models that primarily use market observable inputs, such as yield curves, and option volatilities. The fair value of derivatives includes values associated with counterparty credit risk and the Company’s own credit standing. The Company classifies these derivatives, included in other assets and other liabilities, as Level 2 in the fair value hierarchy. Concurrent with the sale of the Visa Class B restricted shares, the Company entered into an agreement with the buyer that requires payment to the buyer in the event Visa reduces each member bank’s Class B conversion ratio to unrestricted Class A common shares. The Visa derivative of $6.5 million and $7.5 million was included in the unaudited consolidated balance sheets at June 30, 2017 and December 31, 2016, respectively, to provide for the fair value of this liability. The potential liability related to this funding swap agreement was determined based on management’s estimate of the timing and the amount of Visa’s litigation settlement and the resulting payments due to the counterparty under the terms of the contract. As such, the funding swap agreement is classified as Level 3 in the fair value hierarchy. The significant unobservable inputs used in the fair value measurement of the Company’s funding swap agreement are the potential future changes in the conversion factor, expected term and growth rate of the market price of Visa Class A common shares. Material increases or (decreases) in any of those inputs may result in a significantly higher or (lower) fair value measurement. Assets and Liabilities Recorded at Fair Value on a Recurring Basis Assets and liabilities measured at fair value on a recurring basis as of June 30, 2017 and December 31, 2016 are summarized below: Fair Value Measurements as of June 30, 2017 Quoted Prices in Significant Active Markets for Other Significant Identical Assets Observable Unobservable (dollars in thousands) (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets U.S. Treasury securities $ — $ 396,842 $ — $ 396,842 Government-sponsored enterprises debt securities — 245,318 — 245,318 Government agency mortgage-backed securities (1) — 168,798 — 168,798 Government-sponsored enterprises mortgage-backed securities (1) — 191,617 — 191,617 Non-government asset-backed securities — 3,801 — 3,801 Collateralized mortgage obligations: Government agency — 3,309,319 — 3,309,319 Government-sponsored enterprises — 811,174 — 811,174 Total available-for-sale securities — 5,126,869 — 5,126,869 Other assets (2) — 19,660 — 19,660 Liabilities Other liabilities (3) — (19,084) (6,493) (25,577) Total $ — $ 5,127,445 $ (6,493) $ 5,120,952 Fair Value Measurements as of December 31, 2016 Quoted Prices in Significant Active Markets for Other Significant Identical Assets Observable Unobservable (dollars in thousands) (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets U.S. Treasury securities $ — $ 392,473 $ — $ 392,473 Government-sponsored enterprises debt securities — 242,667 — 242,667 Government agency mortgage-backed securities (1) — 185,663 — 185,663 Government-sponsored enterprises mortgage-backed securities (1) — 204,385 — 204,385 Non-government asset-backed securities — 12,583 — 12,583 Collateralized mortgage obligations: Government agency — 3,351,822 — 3,351,822 Government-sponsored enterprises — 687,921 — 687,921 Total available-for-sale securities — 5,077,514 — 5,077,514 Other assets (2) — 15,982 — 15,982 Liabilities Other liabilities (3) — (23,742) (7,460) (31,202) Total $ — $ 5,069,754 $ (7,460) $ 5,062,294 (1) Backed by residential real estate. (2) Other assets include derivative assets. (3) Other liabilities include derivative liabilities. Changes in Fair Value Levels For the three and six months ended June 30, 2017 and 2016, there were no transfers between fair value hierarchy levels. The changes in Level 3 liabilities measured at fair value on a recurring basis for the three and six months ended June 30, 2017 and 2016 are summarized in the table below. Visa Derivative (dollars in thousands) 2017 2016 Three Months Ended June 30, Balance as of April 1, $ (6,987) $ (8,828) Total net (losses) gains included in other noninterest income (35) 19 Settlements 529 433 Balance as of June 30, $ (6,493) $ (8,376) Total net (losses) gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of June 30, $ (35) $ 19 Six Months Ended June 30, Balance as of January 1, $ (7,460) $ — Total net (losses) gains included in other noninterest income (32) 19 Purchases — (8,875) Settlements 999 480 Balance as of June 30, $ (6,493) $ (8,376) Total net (losses) gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of June 30, $ (32) $ 19 Valuation Techniques Used in the Fair Value Measurement of Assets and Liabilities Carried at Other Than Fair Value For the financial instruments that are not required to be carried at fair value on a recurring basis (categorized in the valuation hierarchy table below), the Company uses the following methods and assumptions to estimate the fair value: Short-term financial assets Short-term financial assets include cash and due from banks, including Federal funds sold and accrued interest receivable. The carrying amount is considered a reasonable estimate of fair value because there is a relatively short duration of time between the origination of the instrument and its expected realization. As such, these short-term financial assets are classified as Level 1. Fair values of fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities. Accordingly, these assets are classified as Level 2. Loans Fair values are estimated for pools of loans with similar characteristics using discounted cash flow analyses. The Company utilizes interest rates currently being offered for groups of loans with similar terms to borrowers of similar credit quality to estimate the fair values of: (1) commercial and industrial loans; (2) certain mortgage loans, including 1-4 family residential, commercial real estate and rental property; and (3) consumer loans. As such, loans are classified as Level 3. Deposits The fair value of deposits with no maturity date, such as interest-bearing and noninterest-bearing checking, regular savings, and certain types of money market savings accounts, approximate their carrying amounts, the amounts payable on demand at the reporting date. Accordingly, these are classified as Level 1. Fair values of fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities. Accordingly, these are classified as Level 2. Short-term borrowings The fair values of short-term borrowings are estimated using quoted market prices or discounted cash flow analyses based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements. As such, short-term borrowings are classified as Level 2. Off-balance sheet instruments Fair values of letters of credit and commitments to extend credit are determined based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. As such, off-balance sheet financial instruments are classified as Level 3. Standby letters of credit The Company recognizes a liability for the fair value of the obligation undertaken in issuing a standby letter of credit at the inception of the guarantee. These liabilities are disclosed at fair value on a nonrecurring basis. Thereafter, these liabilities are carried at amortized cost. The fair value is based on the commission the Company receives when entering into the guarantee. As Company-level data is incorporated into the fair value measurement, the liability for standby letters of credit is classified as Level 3. Assets and Liabilities Carried at Other Than Fair Value The following tables summarize for the periods indicated the estimated fair value of the Company’s financial instruments that are not required to be carried at fair value on a recurring basis, excluding leases and short-term financial assets and liabilities for which carrying amounts approximate fair value. The tables also summarize the fair values of the Company’s off-balance sheet commitments, excluding lease commitments. June 30, 2017 Fair Value Measurements Quoted Prices in Significant Significant Active Markets Other Unobservable for Identical Observable Inputs (dollars in thousands) Book Value Assets (Level 1) Inputs (Level 2) (Level 3) Total Financial assets: Short-term financial assets $ 1,227,765 $ 355,752 $ 872,012 $ — $ 1,227,764 Loans (1) 11,881,716 — — 11,860,477 11,860,477 Financial liabilities: Deposits $ 17,452,262 $ 13,384,203 $ 4,064,576 $ — $ 17,448,779 Off-balance sheet financial instruments: Commitments to extend credit (2) $ 18,578 $ — $ — $ 18,578 $ 18,578 Standby letters of credit 1,077 — — 1,077 1,077 Commercial letters of credit 18 — — 18 18 (1) Excludes financing leases of $180.7 million at June 30, 2017. (2) There were no lease commitments at June 30, 2017. December 31, 2016 Fair Value Measurements Quoted Prices in Significant Significant Active Markets Other Unobservable for Identical Observable Inputs (dollars in thousands) Book Value Assets (Level 1) Inputs (Level 2) (Level 3) Total Financial assets: Short-term financial assets $ 1,052,058 $ 253,827 $ 798,226 $ — $ 1,052,053 Loans (1) 11,340,338 — — 11,306,675 11,306,675 Financial liabilities: Deposits $ 16,794,532 $ 13,055,935 $ 3,730,945 $ — $ 16,786,880 Short-term borrowings 9,151 — 9,109 — 9,109 Off-balance sheet financial instruments: Commitments to extend credit (2) $ 20,677 $ — $ — $ 20,677 $ 20,677 Standby letters of credit 876 — — 876 876 Commercial letters of credit 17 — — 17 17 (1) Excludes financing leases of $180.0 million at December 31, 2016. (2) There were no lease commitments at December 31, 2016. Valuation Techniques Used in the Fair Value Measurement of Assets and Liabilities Carried at the Lower of Cost or Fair Value The Company applies the following valuation techniques to assets measured at the lower of cost or fair value: Mortgage servicing rights (“MSRs”) MSRs are carried at the lower of cost or fair value and are therefore subject to fair value measurements on a nonrecurring basis. The fair value of MSRs is determined using models which use significant unobservable inputs, such as estimates of prepayment rates, the resultant weighted average lives of the MSRs and the option-adjusted spread levels. Accordingly, the Company classifies MSRs as Level 3. Impaired loans A large portion of the Company’s impaired loans are collateral dependent and are measured at fair value on a nonrecurring basis using collateral values as a practical expedient. The fair values of collateral for impaired loans are primarily based on real estate appraisal reports prepared by third party appraisers less disposition costs, present value of the expected future cash flows or the loan’s observable market price. Certain loans are measured based on the present value of expected future cash flows, discounted at the loan’s effective rate, which is not a fair value measurement. The Company measures the impairment on certain loans and leases by performing a lower-of-cost-or-fair-value analysis. If impairment is determined by the value of the collateral or an observable market price, it is written down to fair value on a nonrecurring basis as Level 3. Other real estate owned The Company values these properties at fair value at the time the Company acquires them, which establishes their new cost basis. After acquisition, the Company carries such properties at the lower of cost or fair value less estimated selling costs on a nonrecurring basis. Fair value is measured on a nonrecurring basis using collateral values as a practical expedient. The fair values of collateral for other real estate owned are primarily based on real estate appraisal reports prepared by third party appraisers less disposition costs, and are classified as Level 3. Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis The Company may be required to record certain assets at fair value on a nonrecurring basis in accordance with GAAP. These assets are subject to fair value adjustments that result from the application of lower of cost or fair value accounting or write-downs of individual assets to fair value. The following table provides the level of valuation inputs used to determine each fair value adjustment and the fair value of the related individual assets or portfolio of assets with fair value adjustments on a nonrecurring basis as of June 30, 2017 and December 31, 2016: (dollars in thousands) Level 1 Level 2 Level 3 June 30, 2017 Impaired loans $ — $ — $ — December 31, 2016 Impaired loans $ — $ — $ 1,567 Total losses on impaired loans for the six months ended June 30, 2017 and 2016 was $0.5 million and $0.2 million, respectively. For Level 3 assets and liabilities measured at fair value on a recurring or nonrecurring basis as of June 30, 2017 and December 31, 2016, the significant unobservable inputs used in the fair value measurements were as follows: Quantitative Information about Level 3 Fair Value Measurements at June 30, 2017 Significant Range (dollars in thousands) Fair value Valuation Technique Unobservable Input (Weighted Average) Other liabilities $ (6,493) Discounted Cash Flow Expected Conversion Factor 1.6483 Expected Term 4 years Growth Rate 15% Quantitative Information about Level 3 Fair Value Measurements at December 31, 2016 Range (dollars in thousands) Fair value Valuation Technique Unobservable Input (Weighted Average) Impaired loans $ 1,567 Appraisal Value Appraisal Value n/m (1) Other liabilities $ (7,460) Discounted Cash Flow Expected Conversion Factor 1.6483 Expected Term 4 years Growth Rate 15% (1) The fair value of these assets is determined based on appraised values of collateral or broker price opinions, the range of which is not meaningful to disclose. |
Reportable Operating Segments
Reportable Operating Segments | 6 Months Ended |
Jun. 30, 2017 | |
Reportable Operating Segments | |
Reportable Operating Segments | 15. Reportable Operating Segments The Company’s operations are organized into three business segments – Retail Banking, Commercial Banking, and Treasury and Other. These segments reflect how discrete financial information is currently evaluated by the chief operating decision maker and how performance is assessed and resources allocated. The Company’s internal management process measures the performance of these business segments. This process, which is not necessarily comparable with similar information for any other financial institution, uses various techniques to assign balance sheet and income statement amounts to the business segments, including allocations of income, expense, the provision for loan and lease losses, and capital. This process is dynamic and requires certain allocations based on judgment and other subjective factors. Unlike financial accounting, there is no comprehensive authoritative guidance for management accounting that is equivalent to GAAP. The net interest income of the business segments reflects the results of a funds transfer pricing process that matches assets and liabilities with similar interest rate sensitivity and maturity characteristics and reflects the allocation of net interest income related to the Company’s overall asset and liability management activities on a proportionate basis. The basis for the allocation of net interest income is a function of the Company’s assumptions that are subject to change based on changes in current interest rates and market conditions. Funds transfer pricing also serves to transfer interest rate risk to Treasury. The Company allocates the provision for loan and lease losses to each segment based on management’s estimate of the inherent loss content in each of the specific loan and lease portfolios. Noninterest income and expense includes allocations from support units to the business segments. These allocations are based on actual usage where practicably calculated or by management’s estimate of such usage. Income tax expense is allocated to each business segment based on the consolidated effective income tax rate for the period shown. Business Segments Retail Banking Retail Banking offers a broad range of financial products and services to consumers and small businesses. Loan and lease products offered include residential and commercial mortgage loans, home equity lines of credit, automobile loans and leases, personal lines of credit, installment loans and small business loans and leases. Deposit products offered include checking, savings, and time deposit accounts. Retail Banking also offers wealth management services. Products and services from Retail Banking are delivered to customers through 62 banking locations throughout the State of Hawaii, Guam, and Saipan. Commercial Banking Commercial Banking offers products that include corporate banking, residential and commercial real estate loans, commercial lease financing, auto dealer financing, deposit products and credit cards. Commercial lending and deposit products are offered primarily to middle-market and large companies locally, nationally, and internationally. Treasury and Other Treasury consists of corporate asset and liability management activities including interest rate risk management. The segment’s assets and liabilities (and related interest income and expense) consist of interest-bearing deposits, investment securities, federal funds sold and purchased, government deposits, short and long-term borrowings and bank-owned properties. The primary sources of noninterest income are from bank-owned life insurance, net gains from the sale of investment securities, foreign exchange income related to customer-driven currency requests from merchants and island visitors and management of bank-owned properties. The net residual effect of the transfer pricing of assets and liabilities is included in Treasury, along with the elimination of intercompany transactions. Other organizational units (Technology, Operations, Credit and Risk Management, Human Resources, Finance, Administration, Marketing, and Corporate and Regulatory Administration) provide a wide-range of support to the Company’s other income earning segments. Expenses incurred by these support units are charged to the business segments through an internal cost allocation process. The following tables present selected business segment financial information for the periods indicated: Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended June 30, 2017 Net interest income (expense) $ 106,912 $ 27,726 $ (3,384) $ 131,254 Provision for loan and lease losses (1,626) (2,774) — (4,400) Net interest income (expense) after provision for loan and lease losses 105,286 24,952 (3,384) 126,854 Noninterest income 22,381 18,921 7,568 48,870 Noninterest expense (56,168) (15,758) (13,315) (85,241) Income (loss) before (provision) benefit for income taxes 71,499 28,115 (9,131) 90,483 (Provision) benefit for income taxes (26,485) (10,409) 3,306 (33,588) Net income (loss) $ 45,014 $ 17,706 $ (5,825) $ 56,895 Total assets as of June 30, 2017 $ 6,779,914 $ 5,408,202 $ 8,185,858 $ 20,373,974 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Six Months Ended June 30, 2017 Net interest income (expense) $ 212,613 $ 55,259 $ (7,273) $ 260,599 Provision for loan and lease losses (3,289) (5,611) — (8,900) Net interest income (expense) after provision for loan and lease losses 209,324 49,648 (7,273) 251,699 Noninterest income 46,000 36,491 15,786 98,277 Noninterest expense (111,408) (30,807) (27,365) (169,580) Income (loss) before (provision) benefit for income taxes 143,916 55,332 (18,852) 180,396 (Provision) benefit for income taxes (53,218) (20,443) 6,900 (66,761) Net income (loss) $ 90,698 $ 34,889 $ (11,952) $ 113,635 Total assets as of June 30, 2017 $ 6,779,914 $ 5,408,202 $ 8,185,858 $ 20,373,974 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended June 30, 2016 Net interest income (expense) $ 103,771 $ 28,212 $ (11,556) $ 120,427 Provision for loan and lease losses (696) (1,204) — (1,900) Net interest income (expense) after provision for loan and lease losses 103,075 27,008 (11,556) 118,527 Noninterest income 22,525 16,671 7,175 46,371 Noninterest expense (54,266) (13,106) (11,101) (78,473) Income (loss) before (provision) benefit for income taxes 71,334 30,573 (15,482) 86,425 (Provision) benefit for income taxes (26,067) (11,145) 5,647 (31,565) Net income (loss) $ 45,267 $ 19,428 $ (9,835) $ 54,860 Total assets as of June 30, 2016 $ 6,841,661 $ 4,460,197 $ 7,750,735 $ 19,052,593 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Six Months Ended June 30, 2016 Net interest income (expense) $ 206,196 $ 55,805 $ (24,262) $ 237,739 Provision for loan and lease losses (952) (1,648) — (2,600) Net interest income (expense) after provision for loan and lease losses 205,244 54,157 (24,262) 235,139 Noninterest income 46,155 33,019 40,716 119,890 Noninterest expense (109,402) (24,884) (29,251) (163,537) Income (loss) before (provision) benefit for income taxes 141,997 62,292 (12,797) 191,492 (Provision) benefit for income taxes (53,055) (23,241) 5,195 (71,101) Net income (loss) $ 88,942 $ 39,051 $ (7,602) $ 120,391 Total assets as of June 30, 2016 $ 6,841,661 $ 4,460,197 $ 7,750,735 $ 19,052,593 |
Investment Securities (Tables)
Investment Securities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Investment Securities | |
Schedule of amortized cost and fair value of securities | June 30, 2017 December 31, 2016 Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Cost Gains Losses Value U.S. Treasury securities $ 405,011 $ — $ (8,169) $ 396,842 $ 405,637 $ — $ (13,164) $ 392,473 Government-sponsored enterprises debt securities 249,709 54 (4,445) 245,318 249,707 16 (7,056) 242,667 Government agency mortgage-backed securities 173,078 — (4,280) 168,798 190,485 — (4,822) 185,663 Government-sponsored enterprises mortgage-backed securities 194,340 267 (2,990) 191,617 208,034 385 (4,034) 204,385 Non-government asset-backed securities 3,802 — (1) 3,801 12,592 — (9) 12,583 Collateralized mortgage obligations: Government agency 3,345,644 1,760 (38,085) 3,309,319 3,409,822 794 (58,794) 3,351,822 Government-sponsored enterprises 821,593 1,236 (11,655) 811,174 700,338 789 (13,206) 687,921 Total available-for-sale securities $ 5,193,177 $ 3,317 $ (69,625) $ 5,126,869 $ 5,176,615 $ 1,984 $ (101,085) $ 5,077,514 |
Schedule of amortized cost and fair value of debt securities by contractual maturity | June 30, 2017 Amortized Fair (dollars in thousands) Cost Value Due after one year through five years $ 305,580 $ 299,129 Due after five years through ten years 349,140 343,031 654,720 642,160 Government agency mortgage-backed securities 173,078 168,798 Government-sponsored enterprises mortgage-backed securities 194,340 191,617 Non-government asset-backed securities 3,802 3,801 Collateralized mortgage obligations: Government agency 3,345,644 3,309,319 Government-sponsored enterprises 821,593 811,174 Total mortgage- and asset-backed securities 4,538,457 4,484,709 Total available-for-sale securities $ 5,193,177 $ 5,126,869 |
Schedule of unrealized gross losses and fair values of securities in a continuous loss position | Time in Continuous Loss as of June 30, 2017 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value U.S. Treasury securities $ (8,169) $ 396,842 $ — $ — $ (8,169) $ 396,842 Government-sponsored enterprises debt securities (4,445) 210,264 — — (4,445) 210,264 Government agency mortgage-backed securities (4,280) 168,798 — — (4,280) 168,798 Government-sponsored enterprises mortgage-backed securities (2,990) 184,143 — — (2,990) 184,143 Non-government asset-backed securities (1) 1,640 — 2,161 (1) 3,801 Collateralized mortgage obligations: Government agency (29,692) 2,488,757 (8,393) 329,429 (38,085) 2,818,186 Government-sponsored enterprises (2,213) 373,103 (9,442) 254,440 (11,655) 627,543 Total available-for-sale securities with unrealized losses $ (51,790) $ 3,823,547 $ (17,835) $ 586,030 $ (69,625) $ 4,409,577 Time in Continuous Loss as of December 31, 2016 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value U.S. Treasury securities $ (13,164) $ 392,473 $ — $ — $ (13,164) $ 392,473 Government-sponsored enterprises debt securities (7,056) 207,651 — — (7,056) 207,651 Government agency mortgage-backed securities (4,822) 185,663 — — (4,822) 185,663 Government-sponsored enterprises mortgage-backed securities (4,034) 195,848 — — (4,034) 195,848 Non-government asset-backed securities (3) 5,202 (6) 7,381 (9) 12,583 Collateralized mortgage obligations: Government agency (51,484) 2,847,103 (7,310) 233,706 (58,794) 3,080,809 Government-sponsored enterprises (1,807) 252,065 (11,399) 279,282 (13,206) 531,347 Total available-for-sale securities with unrealized losses $ (82,370) $ 4,086,005 $ (18,715) $ 520,369 $ (101,085) $ 4,606,374 |
Loans and Leases (Tables)
Loans and Leases (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Loans and Leases | |
Schedule of components of loans and leases | June 30, December 31, (dollars in thousands) 2017 2016 Commercial and industrial $ 3,331,092 $ 3,239,600 Real estate: Commercial 2,545,479 2,343,495 Construction 555,794 450,012 Residential 3,921,881 3,796,459 Total real estate 7,023,154 6,589,966 Consumer 1,527,470 1,510,772 Lease financing 180,676 180,040 Total loans and leases $ 12,062,392 $ 11,520,378 |
Schedule of components of remaining loan and lease commitments | June 30, December 31, (dollars in thousands) 2017 2016 Commercial and industrial $ 2,180,122 $ 2,185,810 Real estate: Commercial 83,774 88,331 Construction 417,633 434,406 Residential 990,924 953,781 Total real estate 1,492,331 1,476,518 Consumer 1,481,746 1,459,467 Lease financing 16 16 Total loan and lease commitments $ 5,154,215 $ 5,121,811 |
Allowance for Loan and Lease 26
Allowance for Loan and Lease Losses (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Allowance for Loan and Lease Losses | |
Schedule of components of allowance for loan and lease losses | Three Months Ended June 30, 2017 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 31,557 $ 19,932 $ 4,532 $ 813 $ 43,541 $ 27,456 $ 8,016 $ 135,847 Charge-offs (75) — — (146) — (5,251) — (5,472) Recoveries 129 55 — — 150 1,774 — 2,108 Increase (decrease) in Provision 1,730 24 939 190 683 3,924 (3,090) 4,400 Balance at end of period $ 33,341 $ 20,011 $ 5,471 $ 857 $ 44,374 $ 27,903 $ 4,926 $ 136,883 Six Months Ended June 30, 2017 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 33,129 $ 18,448 $ 4,513 $ 847 $ 43,436 $ 28,388 $ 6,733 $ 135,494 Charge-offs (930) — — (146) (22) (10,823) — (11,921) Recoveries 243 132 — — 471 3,564 — 4,410 Increase (decrease) in Provision 899 1,431 958 156 489 6,774 (1,807) 8,900 Balance at end of period $ 33,341 $ 20,011 $ 5,471 $ 857 $ 44,374 $ 27,903 $ 4,926 $ 136,883 Three Months Ended June 30, 2016 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 35,027 $ 18,504 $ 4,514 $ 807 $ 45,638 $ 27,923 $ 4,741 $ 137,154 Charge-offs (52) — — — (456) (4,295) — (4,803) Recoveries 19 47 — 1 460 1,582 — 2,109 Increase (decrease) in Provision 798 (291) 122 (28) 810 3,176 (2,687) 1,900 Balance at end of period $ 35,792 $ 18,260 $ 4,636 $ 780 $ 46,452 $ 28,386 $ 2,054 $ 136,360 Six Months Ended June 30, 2016 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Balance at beginning of period $ 34,025 $ 18,489 $ 3,793 $ 888 $ 46,099 $ 28,385 $ 3,805 $ 135,484 Charge-offs (138) — — — (528) (8,501) — (9,167) Recoveries 222 3,246 — 1 766 3,208 — 7,443 Increase (decrease) in Provision 1,683 (3,475) 843 (109) 115 5,294 (1,751) 2,600 Balance at end of period $ 35,792 $ 18,260 $ 4,636 $ 780 $ 46,452 $ 28,386 $ 2,054 $ 136,360 |
Schedule of disaggregation of Allowance and recorded investment in loans by impairment methodology | June 30, 2017 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Individually evaluated for impairment $ 5 $ 7 $ — $ — $ 653 $ — $ — $ 665 Collectively evaluated for impairment 33,336 20,004 5,471 857 43,721 27,903 4,926 136,218 Balance at end of period $ 33,341 $ 20,011 $ 5,471 $ 857 $ 44,374 $ 27,903 $ 4,926 $ 136,883 Loans and leases: Individually evaluated for impairment $ 19,285 $ 9,263 $ — $ — $ 17,278 $ — $ — $ 45,826 Collectively evaluated for impairment 3,311,807 2,536,216 555,794 180,676 3,904,603 1,527,470 — 12,016,566 Balance at end of period $ 3,331,092 $ 2,545,479 $ 555,794 $ 180,676 $ 3,921,881 $ 1,527,470 $ — $ 12,062,392 December 31, 2016 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for loan and lease losses: Individually evaluated for impairment $ 380 $ 7 $ — $ — $ 705 $ — $ — $ 1,092 Collectively evaluated for impairment 32,749 18,441 4,513 847 42,731 28,388 6,733 134,402 Balance at end of period $ 33,129 $ 18,448 $ 4,513 $ 847 $ 43,436 $ 28,388 $ 6,733 $ 135,494 Loans and leases: Individually evaluated for impairment $ 27,572 $ 12,545 $ — $ 153 $ 19,158 $ — $ — $ 59,428 Collectively evaluated for impairment 3,212,028 2,330,950 450,012 179,887 3,777,301 1,510,772 — 11,460,950 Balance at end of period $ 3,239,600 $ 2,343,495 $ 450,012 $ 180,040 $ 3,796,459 $ 1,510,772 $ — $ 11,520,378 |
Schedule of credit risk profiles by internally assigned grade for loans and leases | June 30, 2017 Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Total Grade: Pass $ 3,227,317 $ 2,501,783 $ 548,893 $ 179,906 $ 6,457,899 Special mention 42,178 22,351 5,821 589 70,939 Substandard 60,230 21,345 1,080 181 82,836 Doubtful 1,367 — — — 1,367 Total $ 3,331,092 $ 2,545,479 $ 555,794 $ 180,676 $ 6,613,041 December 31, 2016 Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Total Grade: Pass $ 3,166,304 $ 2,298,839 $ 445,149 $ 179,345 $ 6,089,637 Special mention 41,719 23,859 3,789 368 69,735 Substandard 29,811 20,797 1,074 174 51,856 Doubtful 1,766 — — 153 1,919 Total $ 3,239,600 $ 2,343,495 $ 450,012 $ 180,040 $ 6,213,147 |
Schedule of credit risk profiles based on payment activity for loans and leases | June 30, 2017 (dollars in thousands) Residential Consumer Consumer - Auto Credit Cards Total Performing $ 3,907,274 $ 230,121 $ 951,329 $ 326,581 $ 5,415,305 Non-performing and delinquent 14,607 3,197 12,848 3,394 34,046 Total $ 3,921,881 $ 233,318 $ 964,177 $ 329,975 $ 5,449,351 December 31, 2016 (dollars in thousands) Residential Consumer Consumer - Auto Credit Cards Total Performing $ 3,778,070 $ 240,185 $ 906,829 $ 340,801 $ 5,265,885 Non-performing and delinquent 18,389 3,327 15,927 3,703 41,346 Total $ 3,796,459 $ 243,512 $ 922,756 $ 344,504 $ 5,307,231 |
Schedule of aging analyses of past due loans and leases | June 30, 2017 Accruing Loans and Leases Greater Total Non Than or Total Accruing 30-59 60-89 Equal to Total Accruing Loans Days Days 90 Days Past Loans and and Total (dollars in thousands) Past Due Past Due Past Due Due Current Leases Leases Outstanding Commercial and industrial $ 791 $ 185 $ 1,275 $ 2,251 $ 3,326,686 $ 3,328,937 $ 2,155 $ 3,331,092 Commercial real estate 3,190 — — 3,190 2,542,289 2,545,479 — 2,545,479 Construction 86 84 350 520 555,274 555,794 — 555,794 Lease financing — — — — 180,676 180,676 — 180,676 Residential 6,334 1,161 1,543 9,038 3,907,274 3,916,312 5,569 3,921,881 Consumer 14,397 3,169 1,873 19,439 1,508,031 1,527,470 — 1,527,470 Total $ 24,798 $ 4,599 $ 5,041 $ 34,438 $ 12,020,230 $ 12,054,668 $ 7,724 $ 12,062,392 December 31, 2016 Accruing Loans and Leases Greater Total Non Than or Total Accruing 30-59 60-89 Equal to Total Accruing Loans Days Days 90 Days Past Loans and and Total (dollars in thousands) Past Due Past Due Past Due Due Current Leases Leases Outstanding Commercial and industrial $ 720 $ 163 $ 449 $ 1,332 $ 3,235,538 $ 3,236,870 $ 2,730 $ 3,239,600 Commercial real estate 475 — — 475 2,343,020 2,343,495 — 2,343,495 Construction — — — — 450,012 450,012 — 450,012 Lease financing — — 83 83 179,804 179,887 153 180,040 Residential 9,907 1,069 866 11,842 3,778,070 3,789,912 6,547 3,796,459 Consumer 17,626 3,460 1,870 22,956 1,487,816 1,510,772 — 1,510,772 Total $ 28,728 $ 4,692 $ 3,268 $ 36,688 $ 11,474,260 $ 11,510,948 $ 9,430 $ 11,520,378 |
Schedule of total carrying amounts and total unpaid principal balances of impaired loans and leases | June 30, 2017 Unpaid Recorded Principal Related (dollars in thousands) Investment Balance Allowance Impaired loans with no related allowance recorded: Commercial and industrial $ 19,129 $ 19,861 $ — Commercial real estate 8,348 8,348 — Residential 8,300 8,908 — Total $ 35,777 $ 37,117 $ — Impaired loans with a related allowance recorded: Commercial and industrial $ 156 $ 156 $ 5 Commercial real estate 915 915 7 Residential 8,978 9,259 653 Total $ 10,049 $ 10,330 $ 665 Total impaired loans: Commercial and industrial $ 19,285 $ 20,017 $ 5 Commercial real estate 9,263 9,263 7 Residential 17,278 18,167 653 Total $ 45,826 $ 47,447 $ 665 December 31, 2016 Unpaid Recorded Principal Related (dollars in thousands) Investment Balance Allowance Impaired loans with no related allowance recorded: Commercial and industrial $ 22,404 $ 22,608 $ — Commercial real estate 11,598 11,598 — Lease financing 153 153 — Residential 9,608 10,628 — Total $ 43,763 $ 44,987 $ — Impaired loans with a related allowance recorded: Commercial and industrial $ 5,168 $ 5,624 $ 380 Commercial real estate 947 947 7 Residential 9,550 9,831 705 Total $ 15,665 $ 16,402 $ 1,092 Total impaired loans: Commercial and industrial $ 27,572 $ 28,232 $ 380 Commercial real estate 12,545 12,545 7 Lease financing 153 153 — Residential 19,158 20,459 705 Total $ 59,428 $ 61,389 $ 1,092 |
Schedule of average balances, and of interest income recognized from, impaired loans | Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Average Interest Average Interest Recorded Income Recorded Income (dollars in thousands) Investment Recognized Investment Recognized Impaired loans with no related allowance recorded: Commercial and industrial $ 20,068 $ 209 $ 20,847 $ 438 Commercial real estate 9,866 117 10,443 246 Lease financing 77 — 102 — Residential 8,187 144 8,661 280 Total $ 38,198 $ 470 $ 40,053 $ 964 Impaired loans with a related allowance recorded: Commercial and industrial $ 3,697 $ 3 $ 4,187 $ 50 Commercial real estate 924 11 932 22 Residential 9,140 95 9,276 189 Total $ 13,761 $ 109 $ 14,395 $ 261 Total impaired loans: Commercial and industrial $ 23,765 $ 212 $ 25,034 $ 488 Commercial real estate 10,790 128 11,375 268 Lease financing 77 — 102 — Residential 17,327 239 17,937 469 Total $ 51,959 $ 579 $ 54,448 $ 1,225 Three Months Ended Six Months Ended June 30, 2016 June 30, 2016 Average Interest Average Interest Recorded Income Recorded Income (dollars in thousands) Investment Recognized Investment Recognized Impaired loans with no related allowance recorded: Commercial and industrial $ 30,443 $ 338 $ 25,577 $ 651 Commercial real estate 8,397 140 7,527 284 Construction 283 — 188 8 Lease financing 176 — 177 — Residential 13,626 104 14,166 235 Total $ 52,925 $ 582 $ 47,635 $ 1,178 Impaired loans with a related allowance recorded: Commercial and industrial $ 892 $ — $ 595 $ — Residential 8,857 85 8,267 176 Total $ 9,749 $ 85 $ 8,862 $ 176 Total impaired loans: Commercial and industrial $ 31,335 $ 338 $ 26,172 $ 651 Commercial real estate 8,397 140 7,527 284 Construction 283 — 188 8 Lease financing 176 — 177 — Residential 22,483 189 22,433 411 Total $ 62,674 $ 667 $ 56,497 $ 1,354 |
Schedule of information related to loans modified in a TDR | Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Number of Recorded Related Number of Recorded Related (dollars in thousands) Contracts Investment (1) Allowance Contracts Investment (1) Allowance Commercial and industrial — $ — $ — 1 $ 1,150 $ — Residential 1 310 10 2 663 21 Total 1 $ 310 $ 10 3 $ 1,813 $ 21 Three Months Ended Six Months Ended June 30, 2016 June 30, 2016 Number of Recorded Related Number of Recorded Related (dollars in thousands) Contracts Investment (1) Allowance Contracts Investment (1) Allowance Commercial and industrial 2 $ 7,857 $ — 4 $ 15,953 $ — Commercial real estate 2 5,538 — 2 5,538 — Residential 2 1,195 — 8 3,589 63 Total 6 $ 14,590 $ — 14 $ 25,080 $ 63 (1) The recorded investment balances reflect all partial paydowns and charge-offs since the modification date and do not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. |
Schedule of TDRs that defaulted in period within 12 months of their permanent modification date | Three Months Ended Six Months Ended Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 June 30, 2016 June 30, 2016 Number of Recorded Number of Recorded Number of Recorded Number of Recorded (dollars in thousands) Contracts Investment (1) Contracts Investment (1) Contracts Investment (1) Contracts Investment (1) Commercial and industrial (2) 1 $ 2,496 1 $ 2,496 — $ — 1 $ 2,496 Commercial real estate (3) 1 1,393 1 1,393 — — — — Residential (4) — — 1 510 — — — — Total 2 $ 3,889 3 $ 4,399 — $ — 1 $ 2,496 (1) The recorded investment balances reflect all partial paydowns and charge-offs since the modification date and do not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. (2) For the three months ended June 30, 2017 and six months ended June 30, 2017 and 2016, the maturity date for the commercial and industrial loan that subsequently defaulted was extended. (3) For the three and six months ended June 30, 2017, the commercial real estate loan that subsequently defaulted was extended. (4) For the six months ended June 30, 2017, the residential real estate loan that subsequently defaulted was modified for interest-only payments. |
Transfers of Financial Assets (
Transfers of Financial Assets (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Transfers of Financial Assets | |
Schedule of carrying amounts of assets pledged as collateral | (dollars in thousands) June 30, 2017 December 31, 2016 Public deposits $ 2,728,505 $ 2,521,761 Federal Home Loan Bank 2,260,995 2,097,233 Federal Reserve Bank 903,335 935,672 Repurchase agreements — 10,066 ACH transactions 151,003 152,394 Interest rate swaps 35,153 30,399 Total $ 6,078,991 $ 5,747,525 |
Schedule of disaggregation of gross amount of recognized liabilities for repurchase agreements by class of collateral pledged | December 31, 2016 Remaining Contractual Maturity of the Agreements Up to Greater than (dollars in thousands) 30 days 30-90 days 90 days Total Government agency collateralized mortgage obligations $ 1,200 $ — $ 4,951 $ 6,151 Government-sponsored enterprises mortgage-backed securities — 2,000 1,000 3,000 Gross amount of recognized liabilities for repurchase agreements $ 1,200 $ 2,000 $ 5,951 $ 9,151 |
Deposits (Tables)
Deposits (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Deposits | |
Schedule of deposits by category | (dollars in thousands) June 30, 2017 December 31, 2016 U.S.: Interest-bearing $ 10,903,294 $ 10,129,958 Noninterest-bearing 5,227,404 5,399,212 Foreign: Interest-bearing 677,370 671,957 Noninterest-bearing 644,194 593,405 Total deposits $ 17,452,262 $ 16,794,532 |
Schedule of maturity distribution of time certificates of deposits | The following table presents the maturity distribution of time certificates of deposit as of June 30, 2017: Under $250,000 (dollars in thousands) $250,000 or More Total Three months or less $ 236,404 $ 1,714,290 $ 1,950,694 Over three through six months 269,544 549,241 818,785 Over six through twelve months 267,980 394,465 662,445 One to two years 126,118 83,882 210,000 Two to three years 124,299 47,956 172,255 Three to four years 92,840 49,420 142,260 Four to five years 81,989 29,613 111,602 Thereafter 18 — 18 Total $ 1,199,192 $ 2,868,867 $ 4,068,059 |
Accumulated Other Comprehensi29
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accumulated Other Comprehensive Loss | |
Schedule of changes in accumulated other comprehensive loss | Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at March 31, 2017 $ (143,296) $ 56,604 $ (86,692) Three months ended June 30, 2017 Investment securities: Unrealized net gains arising during the period 31,215 (12,330) 18,885 Net change in unrealized gains on investment securities 31,215 (12,330) 18,885 Cash flow derivative hedges: Unrealized net gains on cash flow derivative hedges arising during the period 258 (102) 156 Net change in unrealized gains on cash flow derivative hedges 258 (102) 156 Other comprehensive income 31,473 (12,432) 19,041 Accumulated other comprehensive loss at June 30, 2017 $ (111,823) $ 44,172 $ (67,651) Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2016 $ (145,472) $ 57,461 $ (88,011) Six months ended June 30, 2017 Investment securities: Unrealized net gains arising during the period 32,793 (12,951) 19,842 Net change in unrealized gains on investment securities 32,793 (12,951) 19,842 Cash flow derivative hedges: Unrealized net gains on cash flow derivative hedges arising during the period 856 (338) 518 Net change in unrealized gains on cash flow derivative hedges 856 (338) 518 Other comprehensive income 33,649 (13,289) 20,360 Accumulated other comprehensive loss at June 30, 2017 $ (111,823) $ 44,172 $ (67,651) Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at March 31, 2016 $ (30,369) $ 11,996 $ (18,373) Three months ended June 30, 2016 Pension and other benefits: Change due to Reorganization Transactions (78) 32 (46) Net change in pension and other benefits (78) 32 (46) Investment securities: Unrealized net gains arising during the period 21,605 (8,535) 13,070 Reclassification of net gains to net income: Investment securities gains, net (3) — (3) Net change in unrealized gains on investment securities 21,602 (8,535) 13,067 Cash flow derivative hedges: Unrealized net gains on cash flow derivative hedges arising during the period 201 (76) 125 Net change in unrealized gains on cash flow derivative hedges 201 (76) 125 Other comprehensive income 21,725 (8,579) 13,146 Accumulated other comprehensive loss at June 30, 2016 $ (8,644) $ 3,417 $ (5,227) Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2015 $ (84,722) $ 33,463 $ (51,259) Six months ended June 30, 2016 Pension and other benefits: Change due to Reorganization Transactions (78) 32 (46) Net change in pension and other benefits (78) 32 (46) Investment securities: Unrealized net gains arising during the period 102,515 (40,493) 62,022 Reclassification of net gains to net income: Investment securities gains, net (25,731) 10,164 (15,567) Net change in unrealized gains on investment securities 76,784 (30,329) 46,455 Cash flow derivative hedges: Unrealized net losses on cash flow derivative hedges arising during the period (628) 251 (377) Net change in unrealized losses on cash flow derivative hedges (628) 251 (377) Other comprehensive income 76,078 (30,046) 46,032 Accumulated other comprehensive loss at June 30, 2016 $ (8,644) $ 3,417 $ (5,227) |
Summary of changes in accumulated other comprehensive loss, net of tax | Unrealized Total Pensions Unrealized Gains Accumulated and Gains (Losses) (Losses) on Other Other on Investment Cash Flow Comprehensive (dollars in thousands) Benefits Securities Derivative Hedges Loss Three Months Ended June 30, 2017 Balance at beginning of period $ (30,237) $ (59,001) $ 2,546 $ (86,692) Other comprehensive income — 18,885 156 19,041 Balance at end of period $ (30,237) $ (40,116) $ 2,702 $ (67,651) Six Months Ended June 30, 2017 Balance at beginning of period $ (30,237) $ (59,958) $ 2,184 $ (88,011) Other comprehensive income — 19,842 518 20,360 Balance at end of period $ (30,237) $ (40,116) $ 2,702 $ (67,651) Three Months Ended June 30, 2016 Balance at beginning of period $ (26,883) $ 8,282 $ 228 $ (18,373) Other comprehensive (loss) income (46) 13,067 125 13,146 Balance at end of period $ (26,929) $ 21,349 $ 353 $ (5,227) Six Months Ended June 30, 2016 Balance at beginning of period $ (26,883) $ (25,106) $ 730 $ (51,259) Other comprehensive (loss) income (46) 46,455 (377) 46,032 Balance at end of period $ (26,929) $ 21,349 $ 353 $ (5,227) |
Regulatory Capital Requiremen30
Regulatory Capital Requirements (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Regulatory Capital Requirements | |
Schedule of regulatory capital ratios | First Hawaiian, Inc. First Hawaiian Minimum Well- and Subsidiary Bank Capital Capitalized (dollars in thousands) Amount Ratio Amount Ratio Ratio (1) Ratio (1) June 30, 2017: Common equity tier 1 capital to risk-weighted assets $ 1,624,761 12.73 % $ 1,615,232 12.67 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,624,761 12.73 % 1,615,232 12.67 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,762,244 13.81 % 1,752,715 13.75 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,624,761 8.70 % 1,615,232 8.66 % 4.00 % 5.00 % December 31, 2016: Common equity tier 1 capital to risk-weighted assets $ 1,569,004 12.75 % $ 1,533,056 12.51 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,569,004 12.75 % 1,533,063 12.51 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,705,098 13.85 % 1,669,157 13.62 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,569,004 8.36 % 1,533,063 8.19 % 4.00 % 5.00 % (1) As defined by the regulations issued by the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation (“FDIC”). |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Income Taxes | |
Schedule of reconciliation of unrecognized tax benefits | Six Months Ended June 30, 2017 2016 Interest Interest and and (dollars in thousands) Tax Penalties Total Tax Penalties Total Balance at January 1, $ 127,085 $ 9,965 $ 137,050 $ 5,903 $ 2,935 $ 8,838 Additions for current year tax positions 1,478 — 1,478 6,297 1,075 7,372 Additions for Reorganization Transactions — 226 226 115,877 5,459 121,336 Additions for prior years' tax positions: Accrual of interest and penalties — 209 209 — 67 67 Reductions for prior years' tax positions: Expiration of statute of limitations (254) (101) (355) (353) (144) (497) Balance at June 30, $ 128,309 $ 10,299 $ 138,608 $ 127,724 $ 9,392 $ 137,116 |
Derivative Financial Instrume32
Derivative Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Derivative Financial Instruments | |
Summary of notional amounts and fair values of derivatives held | June 30, 2017 December 31, 2016 Fair Value Fair Value Notional Asset Liability Notional Asset Liability (dollars in thousands) Amount Derivatives (1) Derivatives (2) Amount Derivatives (1) Derivatives (2) Derivatives designated as hedging instruments: Interest rate swaps $ 196,451 $ — $ (4,149) $ 200,504 $ — $ (5,296) Derivatives not designated as hedging instruments: Interest rate swaps 1,611,148 19,581 (14,935) 1,297,101 15,982 (18,299) Funding swap 40,017 — (6,493) 37,143 — (7,460) Foreign exchange contracts 3,376 79 — 3,664 — (147) (1) The positive fair value of derivative assets is included in other assets. (2) The negative fair value of derivative liabilities is included in other liabilities. |
Schedule of gains and losses recognized in income related to derivatives in fair value hedging relationships | Three Months Ended Six Months Ended June 30, June 30, (dollars in thousands) 2017 2016 2017 2016 Losses recorded in net interest income $ (171) $ (297) $ (369) $ (694) Gains (losses) recorded in noninterest income: Recognized on derivatives (95) (530) 124 (1,518) Recognized on hedged item 199 467 2 1,546 Net gains (losses) recognized on fair value hedges (ineffective portion) 104 (63) 126 28 Net losses recognized on fair value hedges $ (67) $ (360) $ (243) $ (666) |
Summary of effect of cash flow hedging relationships | Three Months Ended Six Months Ended June 30, June 30, (dollars in thousands) 2017 2016 2017 2016 Pretax gains (losses) recognized in other comprehensive income on derivatives (effective portion) $ 258 $ 201 $ 856 $ (628) |
Summary of impact on pretax earnings of derivatives not designated as hedges | Net gains (losses) recognized Three Months Ended Six Months Ended in the consolidated statements June 30, June 30, (dollars in thousands) of income line item 2017 2016 2017 2016 Derivatives Not Designated As Hedging Instruments: Interest rate swaps Other noninterest income $ 100 $ (105) $ 353 $ (395) Funding swap Other noninterest income (35) 19 (32) 19 Foreign exchange contracts Other noninterest income 21 (162) 226 (122) |
Commitments and Contingent Li33
Commitments and Contingent Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingent Liabilities | |
Schedule of financial instruments with off-balance sheet risk | June 30, December 31, (dollars in thousands) 2017 2016 Financial instruments whose contract amounts represent credit risk: Commitments to extend credit $ 5,154,215 $ 5,121,811 Standby letters of credit 73,776 60,848 Commercial letters of credit 7,093 6,813 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings per Share | |
Schedule of computation of basic and diluted earnings per share | Three Months Ended Six Months Ended June 30, June 30, (dollars in thousands, except shares and per share amounts) 2017 2016 2017 2016 Numerator: Net income $ 56,895 $ 54,860 $ 113,635 $ 120,391 Denominator: Basic: weighted-average shares outstanding 139,546,615 139,459,620 139,546,174 139,459,620 Add: weighted-average equity-based awards 99,502 — 98,383 — Diluted: weighted-average shares outstanding 139,646,117 139,459,620 139,644,557 139,459,620 Basic earnings per share $ 0.41 $ 0.39 $ 0.81 $ 0.86 Diluted earnings per share $ 0.41 $ 0.39 $ 0.81 $ 0.86 |
Benefit Plans (Tables)
Benefit Plans (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Benefit Plans | |
Schedule of components of net periodic benefit cost | Pension Benefits Other Benefits (dollars in thousands) 2017 2016 2017 2016 Three Months Ended June 30, Service cost $ 157 $ 214 $ 179 $ 192 Interest cost 2,042 2,157 201 211 Expected return on plan assets (1,242) (1,164) — — Prior service credit — — (108) (107) Recognized net actuarial loss 1,999 1,774 — — Total net periodic benefit cost $ 2,956 $ 2,981 $ 272 $ 296 Six Months Ended June 30, Service cost $ 315 $ 429 $ 358 $ 384 Interest cost 4,083 4,314 402 421 Expected return on plan assets (2,484) (2,335) — — Prior service credit — — (215) (214) Recognized net actuarial loss 3,998 3,545 — — Total net periodic benefit cost $ 5,912 $ 5,953 $ 545 $ 591 |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value | |
Schedule of assets and liabilities measured at fair value on a recurring basis | Fair Value Measurements as of June 30, 2017 Quoted Prices in Significant Active Markets for Other Significant Identical Assets Observable Unobservable (dollars in thousands) (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets U.S. Treasury securities $ — $ 396,842 $ — $ 396,842 Government-sponsored enterprises debt securities — 245,318 — 245,318 Government agency mortgage-backed securities (1) — 168,798 — 168,798 Government-sponsored enterprises mortgage-backed securities (1) — 191,617 — 191,617 Non-government asset-backed securities — 3,801 — 3,801 Collateralized mortgage obligations: Government agency — 3,309,319 — 3,309,319 Government-sponsored enterprises — 811,174 — 811,174 Total available-for-sale securities — 5,126,869 — 5,126,869 Other assets (2) — 19,660 — 19,660 Liabilities Other liabilities (3) — (19,084) (6,493) (25,577) Total $ — $ 5,127,445 $ (6,493) $ 5,120,952 Fair Value Measurements as of December 31, 2016 Quoted Prices in Significant Active Markets for Other Significant Identical Assets Observable Unobservable (dollars in thousands) (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets U.S. Treasury securities $ — $ 392,473 $ — $ 392,473 Government-sponsored enterprises debt securities — 242,667 — 242,667 Government agency mortgage-backed securities (1) — 185,663 — 185,663 Government-sponsored enterprises mortgage-backed securities (1) — 204,385 — 204,385 Non-government asset-backed securities — 12,583 — 12,583 Collateralized mortgage obligations: Government agency — 3,351,822 — 3,351,822 Government-sponsored enterprises — 687,921 — 687,921 Total available-for-sale securities — 5,077,514 — 5,077,514 Other assets (2) — 15,982 — 15,982 Liabilities Other liabilities (3) — (23,742) (7,460) (31,202) Total $ — $ 5,069,754 $ (7,460) $ 5,062,294 (1) Backed by residential real estate. (2) Other assets include derivative assets. (3) Other liabilities include derivative liabilities. |
Summary of changes in Level 3 liabilities measured at fair value on a recurring basis | Visa Derivative (dollars in thousands) 2017 2016 Three Months Ended June 30, Balance as of April 1, $ (6,987) $ (8,828) Total net (losses) gains included in other noninterest income (35) 19 Settlements 529 433 Balance as of June 30, $ (6,493) $ (8,376) Total net (losses) gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of June 30, $ (35) $ 19 Six Months Ended June 30, Balance as of January 1, $ (7,460) $ — Total net (losses) gains included in other noninterest income (32) 19 Purchases — (8,875) Settlements 999 480 Balance as of June 30, $ (6,493) $ (8,376) Total net (losses) gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of June 30, $ (32) $ 19 |
Schedule of assets and liabilities carried at other than fair value and fair values of off-balance sheet commitments | June 30, 2017 Fair Value Measurements Quoted Prices in Significant Significant Active Markets Other Unobservable for Identical Observable Inputs (dollars in thousands) Book Value Assets (Level 1) Inputs (Level 2) (Level 3) Total Financial assets: Short-term financial assets $ 1,227,765 $ 355,752 $ 872,012 $ — $ 1,227,764 Loans (1) 11,881,716 — — 11,860,477 11,860,477 Financial liabilities: Deposits $ 17,452,262 $ 13,384,203 $ 4,064,576 $ — $ 17,448,779 Off-balance sheet financial instruments: Commitments to extend credit (2) $ 18,578 $ — $ — $ 18,578 $ 18,578 Standby letters of credit 1,077 — — 1,077 1,077 Commercial letters of credit 18 — — 18 18 (1) Excludes financing leases of $180.7 million at June 30, 2017. (2) There were no lease commitments at June 30, 2017. December 31, 2016 Fair Value Measurements Quoted Prices in Significant Significant Active Markets Other Unobservable for Identical Observable Inputs (dollars in thousands) Book Value Assets (Level 1) Inputs (Level 2) (Level 3) Total Financial assets: Short-term financial assets $ 1,052,058 $ 253,827 $ 798,226 $ — $ 1,052,053 Loans (1) 11,340,338 — — 11,306,675 11,306,675 Financial liabilities: Deposits $ 16,794,532 $ 13,055,935 $ 3,730,945 $ — $ 16,786,880 Short-term borrowings 9,151 — 9,109 — 9,109 Off-balance sheet financial instruments: Commitments to extend credit (2) $ 20,677 $ — $ — $ 20,677 $ 20,677 Standby letters of credit 876 — — 876 876 Commercial letters of credit 17 — — 17 17 (1) Excludes financing leases of $180.0 million at December 31, 2016. (2) There were no lease commitments at December 31, 2016. |
Schedule of assets with fair value adjustments on a nonrecurring basis | (dollars in thousands) Level 1 Level 2 Level 3 June 30, 2017 Impaired loans $ — $ — $ — December 31, 2016 Impaired loans $ — $ — $ 1,567 |
Schedule of significant unobservable inputs used in fair value measurements for Level 3 assets and liabilities measured at fair value on a recurring or nonrecurring basis | Quantitative Information about Level 3 Fair Value Measurements at June 30, 2017 Significant Range (dollars in thousands) Fair value Valuation Technique Unobservable Input (Weighted Average) Other liabilities $ (6,493) Discounted Cash Flow Expected Conversion Factor 1.6483 Expected Term 4 years Growth Rate 15% Quantitative Information about Level 3 Fair Value Measurements at December 31, 2016 Range (dollars in thousands) Fair value Valuation Technique Unobservable Input (Weighted Average) Impaired loans $ 1,567 Appraisal Value Appraisal Value n/m (1) Other liabilities $ (7,460) Discounted Cash Flow Expected Conversion Factor 1.6483 Expected Term 4 years Growth Rate 15% (1) The fair value of these assets is determined based on appraised values of collateral or broker price opinions, the range of which is not meaningful to disclose. |
Reportable Operating Segments (
Reportable Operating Segments (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Reportable Operating Segments | |
Schedule of selected business segment financial information | Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended June 30, 2017 Net interest income (expense) $ 106,912 $ 27,726 $ (3,384) $ 131,254 Provision for loan and lease losses (1,626) (2,774) — (4,400) Net interest income (expense) after provision for loan and lease losses 105,286 24,952 (3,384) 126,854 Noninterest income 22,381 18,921 7,568 48,870 Noninterest expense (56,168) (15,758) (13,315) (85,241) Income (loss) before (provision) benefit for income taxes 71,499 28,115 (9,131) 90,483 (Provision) benefit for income taxes (26,485) (10,409) 3,306 (33,588) Net income (loss) $ 45,014 $ 17,706 $ (5,825) $ 56,895 Total assets as of June 30, 2017 $ 6,779,914 $ 5,408,202 $ 8,185,858 $ 20,373,974 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Six Months Ended June 30, 2017 Net interest income (expense) $ 212,613 $ 55,259 $ (7,273) $ 260,599 Provision for loan and lease losses (3,289) (5,611) — (8,900) Net interest income (expense) after provision for loan and lease losses 209,324 49,648 (7,273) 251,699 Noninterest income 46,000 36,491 15,786 98,277 Noninterest expense (111,408) (30,807) (27,365) (169,580) Income (loss) before (provision) benefit for income taxes 143,916 55,332 (18,852) 180,396 (Provision) benefit for income taxes (53,218) (20,443) 6,900 (66,761) Net income (loss) $ 90,698 $ 34,889 $ (11,952) $ 113,635 Total assets as of June 30, 2017 $ 6,779,914 $ 5,408,202 $ 8,185,858 $ 20,373,974 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended June 30, 2016 Net interest income (expense) $ 103,771 $ 28,212 $ (11,556) $ 120,427 Provision for loan and lease losses (696) (1,204) — (1,900) Net interest income (expense) after provision for loan and lease losses 103,075 27,008 (11,556) 118,527 Noninterest income 22,525 16,671 7,175 46,371 Noninterest expense (54,266) (13,106) (11,101) (78,473) Income (loss) before (provision) benefit for income taxes 71,334 30,573 (15,482) 86,425 (Provision) benefit for income taxes (26,067) (11,145) 5,647 (31,565) Net income (loss) $ 45,267 $ 19,428 $ (9,835) $ 54,860 Total assets as of June 30, 2016 $ 6,841,661 $ 4,460,197 $ 7,750,735 $ 19,052,593 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Six Months Ended June 30, 2016 Net interest income (expense) $ 206,196 $ 55,805 $ (24,262) $ 237,739 Provision for loan and lease losses (952) (1,648) — (2,600) Net interest income (expense) after provision for loan and lease losses 205,244 54,157 (24,262) 235,139 Noninterest income 46,155 33,019 40,716 119,890 Noninterest expense (109,402) (24,884) (29,251) (163,537) Income (loss) before (provision) benefit for income taxes 141,997 62,292 (12,797) 191,492 (Provision) benefit for income taxes (53,055) (23,241) 5,195 (71,101) Net income (loss) $ 88,942 $ 39,051 $ (7,602) $ 120,391 Total assets as of June 30, 2016 $ 6,841,661 $ 4,460,197 $ 7,750,735 $ 19,052,593 |
Organization and Basis of Pre38
Organization and Basis of Presentation - Subsidiary Ownership (Details) | Jun. 30, 2017 |
First Hawaiian, Inc. | First Hawaiian Bank | |
Capitalization | |
Outstanding common stock owned (as a percent) | 100.00% |
Organization and Basis of Pre39
Organization and Basis of Presentation - Reorganization and Stock Offerings (Details) - USD ($) $ / shares in Units, $ in Billions | Feb. 17, 2017 | Aug. 09, 2016 | Apr. 01, 2016 | Jun. 30, 2017 | Jun. 30, 2015 |
Reorganization Transactions | |||||
Threshold of U.S. non-branch assets of foreign banking organization which will require a U.S. intermediate holding company | $ 50 | ||||
BNP Paribas | First Hawaiian, Inc. | |||||
Reorganization Transactions | |||||
Outstanding common stock owned after sales of shares (as a percent) | 62.00% | ||||
Outstanding common stock owned (as a percent) | 62.00% | ||||
Initial public offering | BNP Paribas | First Hawaiian, Inc. | |||||
Reorganization Transactions | |||||
Ownership interest sold (as a percent) | 17.00% | ||||
Number of shares sold | 24,250,000 | ||||
Offering price (in dollars per share) | $ 23 | ||||
Reorganization Transactions on April 1, 2016 | BancWest Corporation (BancWest) | Bank of the West (BOW) | BancWest Holding Inc. (BWHI) | |||||
Reorganization Transactions | |||||
Ownership prior to transactions (as a percent) | 100.00% | ||||
Secondary offering | BNP Paribas | First Hawaiian, Inc. | |||||
Reorganization Transactions | |||||
Number of shares sold | 28,750,000 | ||||
Offering price (in dollars per share) | $ 32 | ||||
Underwriters’ option | BNP Paribas | First Hawaiian, Inc. | |||||
Reorganization Transactions | |||||
Number of shares sold | 3,750,000 | 3,163,043 |
Investment Securities - Amortiz
Investment Securities - Amortized Cost and Fair Value of Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Available for sale debt securities | ||
Amortized Cost | $ 5,193,177 | $ 5,176,615 |
Unrealized Gains | 3,317 | 1,984 |
Unrealized Losses | (69,625) | (101,085) |
Fair value | 5,126,869 | 5,077,514 |
U.S. Treasury securities | ||
Available for sale debt securities | ||
Amortized Cost | 405,011 | 405,637 |
Unrealized Losses | (8,169) | (13,164) |
Fair value | 396,842 | 392,473 |
Government-sponsored enterprises debt securities | ||
Available for sale debt securities | ||
Amortized Cost | 249,709 | 249,707 |
Unrealized Gains | 54 | 16 |
Unrealized Losses | (4,445) | (7,056) |
Fair value | 245,318 | 242,667 |
Government agency mortgage-backed securities | ||
Available for sale debt securities | ||
Amortized Cost | 173,078 | 190,485 |
Unrealized Losses | (4,280) | (4,822) |
Fair value | 168,798 | 185,663 |
Government-sponsored enterprises mortgage-backed securities | ||
Available for sale debt securities | ||
Amortized Cost | 194,340 | 208,034 |
Unrealized Gains | 267 | 385 |
Unrealized Losses | (2,990) | (4,034) |
Fair value | 191,617 | 204,385 |
Non-government asset-backed securities | ||
Available for sale debt securities | ||
Amortized Cost | 3,802 | 12,592 |
Unrealized Losses | (1) | (9) |
Fair value | 3,801 | 12,583 |
Collateralized mortgage obligations: Government agency | ||
Available for sale debt securities | ||
Amortized Cost | 3,345,644 | 3,409,822 |
Unrealized Gains | 1,760 | 794 |
Unrealized Losses | (38,085) | (58,794) |
Fair value | 3,309,319 | 3,351,822 |
Collateralized mortgage obligations: Government-sponsored enterprises | ||
Available for sale debt securities | ||
Amortized Cost | 821,593 | 700,338 |
Unrealized Gains | 1,236 | 789 |
Unrealized Losses | (11,655) | (13,206) |
Fair value | $ 811,174 | $ 687,921 |
Investment Securities - Proceed
Investment Securities - Proceeds from Calls and Sales, Realized Gains and Losses and Interest Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Proceeds from calls and sales of investment securities | ||||
Proceeds from calls of investment securities | $ 0 | $ 50 | $ 0 | $ 75 |
Proceeds from sales of investment securities | 0 | 0 | 0 | 505 |
Realized investment gains and losses | ||||
Gross realized gains on sales of investments | 0 | 0 | 0 | 25.8 |
Gross realized losses on sales of investments | 0 | 0 | 0 | 0.1 |
Provision for income taxes related to net realized gains on sale of investment securities | 0 | 0 | 0 | 10.2 |
Interest income from taxable and nontaxable investment securities | ||||
Taxable interest income | 25.1 | 19.5 | 51.5 | 36 |
Nontaxable interest income | $ 0 | $ 0 | $ 0 | $ 0 |
Investment Securities - Contrac
Investment Securities - Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Due after one year through five years | $ 305,580 | |
Due after five years through ten years | 349,140 | |
Total contractual maturities | 654,720 | |
Mortgage- and asset-backed securities | 4,538,457 | |
Amortized Cost | 5,193,177 | $ 5,176,615 |
Fair Value | ||
Due after one year through five years | 299,129 | |
Due after five years through ten years | 343,031 | |
Total contractual maturities | 642,160 | |
Mortgage- and asset-backed securities | 4,484,709 | |
Total available for sale securities | 5,126,869 | 5,077,514 |
Government agency mortgage-backed securities | ||
Amortized Cost | ||
Mortgage- and asset-backed securities | 173,078 | |
Amortized Cost | 173,078 | 190,485 |
Fair Value | ||
Mortgage- and asset-backed securities | 168,798 | |
Total available for sale securities | 168,798 | 185,663 |
Government-sponsored enterprises mortgage-backed securities | ||
Amortized Cost | ||
Mortgage- and asset-backed securities | 194,340 | |
Amortized Cost | 194,340 | 208,034 |
Fair Value | ||
Mortgage- and asset-backed securities | 191,617 | |
Total available for sale securities | 191,617 | 204,385 |
Non-government asset-backed securities | ||
Amortized Cost | ||
Mortgage- and asset-backed securities | 3,802 | |
Amortized Cost | 3,802 | 12,592 |
Fair Value | ||
Mortgage- and asset-backed securities | 3,801 | |
Total available for sale securities | 3,801 | 12,583 |
Collateralized mortgage obligations: Government agency | ||
Amortized Cost | ||
Mortgage- and asset-backed securities | 3,345,644 | |
Amortized Cost | 3,345,644 | 3,409,822 |
Fair Value | ||
Mortgage- and asset-backed securities | 3,309,319 | |
Total available for sale securities | 3,309,319 | 3,351,822 |
Collateralized mortgage obligations: Government-sponsored enterprises | ||
Amortized Cost | ||
Mortgage- and asset-backed securities | 821,593 | |
Amortized Cost | 821,593 | 700,338 |
Fair Value | ||
Mortgage- and asset-backed securities | 811,174 | |
Total available for sale securities | $ 811,174 | $ 687,921 |
Investment Securities - Pledged
Investment Securities - Pledged Securities and Concentration (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Pledged securities | ||
Total pledged securities | $ 2,900,000 | $ 2,700,000 |
Securities pledged to secure public deposits | 2,728,505 | 2,521,761 |
Securities pledged to secure public deposits and repurchase transactions | 2,500,000 | |
Securities pledged to secure other financial transactions | 230,000 | 209,100 |
Non-government issuer | ||
Concentration of risk | ||
Securities of issuers in excess of 10% of stockholders' equity | $ 0 | $ 0 |
Investment Securities - Unreali
Investment Securities - Unrealized Gross Losses and Fair Values of Securities in a Continuous Loss Position (Details) $ in Thousands | Jun. 30, 2017USD ($)security | Dec. 31, 2016USD ($)security |
Securities in the available-for-sale portfolio in a continuous loss position | ||
Number of individual securities in a continuous loss position | security | 165 | 158 |
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | $ (51,790) | $ (82,370) |
Less Than 12 Months Fair Value | 3,823,547 | 4,086,005 |
12 Months or Longer Unrealized Losses | (17,835) | (18,715) |
12 Months or Longer Fair Value | 586,030 | 520,369 |
Total Unrealized Losses | (69,625) | (101,085) |
Total Fair Value | 4,409,577 | 4,606,374 |
U.S. Treasury securities | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (8,169) | (13,164) |
Less Than 12 Months Fair Value | 396,842 | 392,473 |
Total Unrealized Losses | (8,169) | (13,164) |
Total Fair Value | 396,842 | 392,473 |
Government-sponsored enterprises debt securities | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (4,445) | (7,056) |
Less Than 12 Months Fair Value | 210,264 | 207,651 |
Total Unrealized Losses | (4,445) | (7,056) |
Total Fair Value | 210,264 | 207,651 |
Government agency mortgage-backed securities | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (4,280) | (4,822) |
Less Than 12 Months Fair Value | 168,798 | 185,663 |
Total Unrealized Losses | (4,280) | (4,822) |
Total Fair Value | 168,798 | 185,663 |
Government-sponsored enterprises mortgage-backed securities | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (2,990) | (4,034) |
Less Than 12 Months Fair Value | 184,143 | 195,848 |
Total Unrealized Losses | (2,990) | (4,034) |
Total Fair Value | 184,143 | 195,848 |
Non-government asset-backed securities | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (1) | (3) |
Less Than 12 Months Fair Value | 1,640 | 5,202 |
12 Months or Longer Unrealized Losses | (6) | |
12 Months or Longer Fair Value | 2,161 | 7,381 |
Total Unrealized Losses | (1) | (9) |
Total Fair Value | 3,801 | 12,583 |
Collateralized mortgage obligations: Government agency | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (29,692) | (51,484) |
Less Than 12 Months Fair Value | 2,488,757 | 2,847,103 |
12 Months or Longer Unrealized Losses | (8,393) | (7,310) |
12 Months or Longer Fair Value | 329,429 | 233,706 |
Total Unrealized Losses | (38,085) | (58,794) |
Total Fair Value | 2,818,186 | 3,080,809 |
Collateralized mortgage obligations: Government-sponsored enterprises | ||
Time in Continuous Loss | ||
Less Than 12 Months Unrealized Losses | (2,213) | (1,807) |
Less Than 12 Months Fair Value | 373,103 | 252,065 |
12 Months or Longer Unrealized Losses | (9,442) | (11,399) |
12 Months or Longer Fair Value | 254,440 | 279,282 |
Total Unrealized Losses | (11,655) | (13,206) |
Total Fair Value | $ 627,543 | $ 531,347 |
Investment Securities - Other-T
Investment Securities - Other-Than-Temporary Impairment (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Investment Securities | ||
Other than temporary impairment recognized | $ 0 | $ 0 |
Investment Securities - Visa Cl
Investment Securities - Visa Class B Restricted Shares (Details) - Class B shares - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | 96 Months Ended | |||
Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2008 | Dec. 31, 2015 | Dec. 31, 2016 | |
Visa | |||||||
Visa Class B Restricted Shares | |||||||
Cost of shares owned | $ 0 | $ 0 | $ 0 | ||||
Net gain related to the sale of stock | $ 22,700 | $ 22,700 | |||||
Number of shares sold | 0 | 274,000 | 0 | 274,000 | 0 | ||
Shares held | 120,000 | 120,000 | |||||
Visa | |||||||
Visa Class B Restricted Shares | |||||||
Stock received in initial public offering (in shares) | 394,000 |
Loans and Leases - Components (
Loans and Leases - Components (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Loans and leases | ||
Loans and leases | $ 12,062,392 | $ 11,520,378 |
Unearned income, including net deferred loan costs | 27,400 | 23,800 |
Residential real estate loans pledged to collateralize the borrowing capacity at the FHLB | 2,300,000 | 2,100,000 |
Consumer and commercial and industrial loans pledged to collateralize the borrowing capacity at the FRB | 903,300 | 935,700 |
Real estate | ||
Loans and leases | ||
Loans and leases | 7,023,154 | 6,589,966 |
Commercial and Industrial | ||
Loans and leases | ||
Loans and leases | 3,331,092 | 3,239,600 |
Commercial Real Estate | ||
Loans and leases | ||
Loans and leases | 2,545,479 | 2,343,495 |
Commercial Real Estate | Real estate | ||
Loans and leases | ||
Loans and leases | 2,545,479 | 2,343,495 |
Construction | ||
Loans and leases | ||
Loans and leases | 555,794 | 450,012 |
Construction | Real estate | ||
Loans and leases | ||
Loans and leases | 555,794 | 450,012 |
Residential | ||
Loans and leases | ||
Loans and leases | 3,921,881 | 3,796,459 |
Real estate loans in the process of foreclosure | 2,400 | 4,100 |
Residential | Real estate | ||
Loans and leases | ||
Loans and leases | 3,921,881 | 3,796,459 |
Consumer | ||
Loans and leases | ||
Loans and leases | 1,527,470 | 1,510,772 |
Lease Financing | ||
Loans and leases | ||
Loans and leases | $ 180,676 | $ 180,040 |
Loans and Leases - Commitments
Loans and Leases - Commitments (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Loans and leases | ||
Loan and lease commitments | $ 5,154,215 | $ 5,121,811 |
Real estate | ||
Loans and leases | ||
Loan and lease commitments | 1,492,331 | 1,476,518 |
Commercial and Industrial | ||
Loans and leases | ||
Loan and lease commitments | 2,180,122 | 2,185,810 |
Commercial Real Estate | Real estate | ||
Loans and leases | ||
Loan and lease commitments | 83,774 | 88,331 |
Construction | Real estate | ||
Loans and leases | ||
Loan and lease commitments | 417,633 | 434,406 |
Residential | Real estate | ||
Loans and leases | ||
Loan and lease commitments | 990,924 | 953,781 |
Consumer | ||
Loans and leases | ||
Loan and lease commitments | 1,481,746 | 1,459,467 |
Lease Financing | ||
Loans and leases | ||
Loan and lease commitments | $ 16 | $ 16 |
Allowance for Loan and Lease 49
Allowance for Loan and Lease Losses - Activity (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)segmentclass | Jun. 30, 2016USD ($) | |
Allowance for loan and lease losses | ||||
Number of primary portfolio segments | segment | 3 | |||
Activity in allowance for loan losses | ||||
Balance at beginning of period | $ 135,847 | $ 137,154 | $ 135,494 | $ 135,484 |
Charge-offs | (5,472) | (4,803) | (11,921) | (9,167) |
Recoveries | 2,108 | 2,109 | 4,410 | 7,443 |
Increase (decrease) in Provision | 4,400 | 1,900 | 8,900 | 2,600 |
Balance at end of period | 136,883 | 136,360 | $ 136,883 | 136,360 |
Commercial Lending | ||||
Allowance for loan and lease losses | ||||
Number of distinct portfolios | class | 4 | |||
Commercial and Industrial | ||||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 31,557 | 35,027 | $ 33,129 | 34,025 |
Charge-offs | (75) | (52) | (930) | (138) |
Recoveries | 129 | 19 | 243 | 222 |
Increase (decrease) in Provision | 1,730 | 798 | 899 | 1,683 |
Balance at end of period | 33,341 | 35,792 | 33,341 | 35,792 |
Commercial Real Estate | ||||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 19,932 | 18,504 | 18,448 | 18,489 |
Recoveries | 55 | 47 | 132 | 3,246 |
Increase (decrease) in Provision | 24 | (291) | 1,431 | (3,475) |
Balance at end of period | 20,011 | 18,260 | 20,011 | 18,260 |
Construction | ||||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 4,532 | 4,514 | 4,513 | 3,793 |
Increase (decrease) in Provision | 939 | 122 | 958 | 843 |
Balance at end of period | 5,471 | 4,636 | 5,471 | 4,636 |
Lease Financing | ||||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 813 | 807 | 847 | 888 |
Charge-offs | (146) | (146) | ||
Recoveries | 1 | 1 | ||
Increase (decrease) in Provision | 190 | (28) | 156 | (109) |
Balance at end of period | 857 | 780 | 857 | 780 |
Residential | ||||
Allowance for loan and lease losses | ||||
Specific allocation for impaired loans in which the net collateral value exceeds the unpaid principal balance of the loan | 0 | 0 | ||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 43,541 | 45,638 | 43,436 | 46,099 |
Charge-offs | (456) | (22) | (528) | |
Recoveries | 150 | 460 | 471 | 766 |
Increase (decrease) in Provision | 683 | 810 | 489 | 115 |
Balance at end of period | 44,374 | 46,452 | 44,374 | 46,452 |
Consumer | ||||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 27,456 | 27,923 | 28,388 | 28,385 |
Charge-offs | (5,251) | (4,295) | (10,823) | (8,501) |
Recoveries | 1,774 | 1,582 | 3,564 | 3,208 |
Increase (decrease) in Provision | 3,924 | 3,176 | 6,774 | 5,294 |
Balance at end of period | 27,903 | 28,386 | 27,903 | 28,386 |
Unallocated | ||||
Activity in allowance for loan losses | ||||
Balance at beginning of period | 8,016 | 4,741 | 6,733 | 3,805 |
Increase (decrease) in Provision | (3,090) | (2,687) | (1,807) | (1,751) |
Balance at end of period | $ 4,926 | $ 2,054 | $ 4,926 | $ 2,054 |
Allowance for Loan and Lease 50
Allowance for Loan and Lease Losses - Disaggregation by Impairment Methodology (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 |
Allowance for loan and lease losses: | ||||||
Individually evaluated for impairment | $ 665 | $ 1,092 | ||||
Collectively evaluated for impairment | 136,218 | 134,402 | ||||
Total allowance for loan and lease losses | 136,883 | $ 135,847 | 135,494 | $ 136,360 | $ 137,154 | $ 135,484 |
Loans and leases: | ||||||
Individually evaluated for impairment | 45,826 | 59,428 | ||||
Collectively evaluated for impairment | 12,016,566 | 11,460,950 | ||||
Total loans and leases | 12,062,392 | 11,520,378 | ||||
Commercial Lending | ||||||
Loans and leases: | ||||||
Total loans and leases | 6,613,041 | 6,213,147 | ||||
Commercial and Industrial | ||||||
Allowance for loan and lease losses: | ||||||
Individually evaluated for impairment | 5 | 380 | ||||
Collectively evaluated for impairment | 33,336 | 32,749 | ||||
Total allowance for loan and lease losses | 33,341 | 31,557 | 33,129 | 35,792 | 35,027 | 34,025 |
Loans and leases: | ||||||
Individually evaluated for impairment | 19,285 | 27,572 | ||||
Collectively evaluated for impairment | 3,311,807 | 3,212,028 | ||||
Total loans and leases | 3,331,092 | 3,239,600 | ||||
Commercial Real Estate | ||||||
Allowance for loan and lease losses: | ||||||
Individually evaluated for impairment | 7 | 7 | ||||
Collectively evaluated for impairment | 20,004 | 18,441 | ||||
Total allowance for loan and lease losses | 20,011 | 19,932 | 18,448 | 18,260 | 18,504 | 18,489 |
Loans and leases: | ||||||
Individually evaluated for impairment | 9,263 | 12,545 | ||||
Collectively evaluated for impairment | 2,536,216 | 2,330,950 | ||||
Total loans and leases | 2,545,479 | 2,343,495 | ||||
Construction | ||||||
Allowance for loan and lease losses: | ||||||
Collectively evaluated for impairment | 5,471 | 4,513 | ||||
Total allowance for loan and lease losses | 5,471 | 4,532 | 4,513 | 4,636 | 4,514 | 3,793 |
Loans and leases: | ||||||
Collectively evaluated for impairment | 555,794 | 450,012 | ||||
Total loans and leases | 555,794 | 450,012 | ||||
Lease Financing | ||||||
Allowance for loan and lease losses: | ||||||
Collectively evaluated for impairment | 857 | 847 | ||||
Total allowance for loan and lease losses | 857 | 813 | 847 | 780 | 807 | 888 |
Loans and leases: | ||||||
Individually evaluated for impairment | 153 | |||||
Collectively evaluated for impairment | 180,676 | 179,887 | ||||
Total loans and leases | 180,676 | 180,040 | ||||
Residential | ||||||
Allowance for loan and lease losses: | ||||||
Individually evaluated for impairment | 653 | 705 | ||||
Collectively evaluated for impairment | 43,721 | 42,731 | ||||
Total allowance for loan and lease losses | 44,374 | 43,541 | 43,436 | 46,452 | 45,638 | 46,099 |
Loans and leases: | ||||||
Individually evaluated for impairment | 17,278 | 19,158 | ||||
Collectively evaluated for impairment | 3,904,603 | 3,777,301 | ||||
Total loans and leases | 3,921,881 | 3,796,459 | ||||
Consumer | ||||||
Allowance for loan and lease losses: | ||||||
Collectively evaluated for impairment | 27,903 | 28,388 | ||||
Total allowance for loan and lease losses | 27,903 | 27,456 | 28,388 | 28,386 | 27,923 | 28,385 |
Loans and leases: | ||||||
Collectively evaluated for impairment | 1,527,470 | 1,510,772 | ||||
Total loans and leases | 1,527,470 | 1,510,772 | ||||
Unallocated | ||||||
Allowance for loan and lease losses: | ||||||
Collectively evaluated for impairment | 4,926 | 6,733 | ||||
Total allowance for loan and lease losses | $ 4,926 | $ 8,016 | $ 6,733 | $ 2,054 | $ 4,741 | $ 3,805 |
Allowance for Loan and Lease 51
Allowance for Loan and Lease Losses - Credit Risk Profiles (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017USD ($)factor | Dec. 31, 2016USD ($) | |
Credit quality | ||
Percentage of loans sold with no recourse not subject to grading | 100.00% | |
Number of risk factors in internal loan rating system | factor | 8 | |
Loans and leases | $ 12,062,392 | $ 11,520,378 |
Loss | ||
Credit quality | ||
Loans and leases | 0 | 0 |
Commercial Lending | ||
Credit quality | ||
Loans and leases | 6,613,041 | 6,213,147 |
Commercial Lending | Pass | ||
Credit quality | ||
Loans and leases | 6,457,899 | 6,089,637 |
Commercial Lending | Special mention | ||
Credit quality | ||
Loans and leases | 70,939 | 69,735 |
Commercial Lending | Substandard | ||
Credit quality | ||
Loans and leases | 82,836 | 51,856 |
Commercial Lending | Doubtful | ||
Credit quality | ||
Loans and leases | 1,367 | 1,919 |
Commercial and Industrial | ||
Credit quality | ||
Loans and leases | 3,331,092 | 3,239,600 |
Commercial and Industrial | Pass | ||
Credit quality | ||
Loans and leases | 3,227,317 | 3,166,304 |
Commercial and Industrial | Special mention | ||
Credit quality | ||
Loans and leases | 42,178 | 41,719 |
Commercial and Industrial | Substandard | ||
Credit quality | ||
Loans and leases | 60,230 | 29,811 |
Commercial and Industrial | Doubtful | ||
Credit quality | ||
Loans and leases | 1,367 | 1,766 |
Commercial Real Estate | ||
Credit quality | ||
Loans and leases | 2,545,479 | 2,343,495 |
Commercial Real Estate | Pass | ||
Credit quality | ||
Loans and leases | 2,501,783 | 2,298,839 |
Commercial Real Estate | Special mention | ||
Credit quality | ||
Loans and leases | 22,351 | 23,859 |
Commercial Real Estate | Substandard | ||
Credit quality | ||
Loans and leases | 21,345 | 20,797 |
Construction | ||
Credit quality | ||
Loans and leases | 555,794 | 450,012 |
Construction | Pass | ||
Credit quality | ||
Loans and leases | 548,893 | 445,149 |
Construction | Special mention | ||
Credit quality | ||
Loans and leases | 5,821 | 3,789 |
Construction | Substandard | ||
Credit quality | ||
Loans and leases | 1,080 | 1,074 |
Lease Financing | ||
Credit quality | ||
Loans and leases | 180,676 | 180,040 |
Lease Financing | Pass | ||
Credit quality | ||
Loans and leases | 179,906 | 179,345 |
Lease Financing | Special mention | ||
Credit quality | ||
Loans and leases | 589 | 368 |
Lease Financing | Substandard | ||
Credit quality | ||
Loans and leases | 181 | 174 |
Lease Financing | Doubtful | ||
Credit quality | ||
Loans and leases | 153 | |
Residential and consumer | ||
Credit quality | ||
Loans and leases | 5,449,351 | 5,307,231 |
Residential and consumer | Performing | ||
Credit quality | ||
Loans and leases | 5,415,305 | 5,265,885 |
Residential and consumer | Non-performing and delinquent | ||
Credit quality | ||
Loans and leases | 34,046 | 41,346 |
Residential | ||
Credit quality | ||
Loans and leases | 3,921,881 | 3,796,459 |
Residential | Performing | ||
Credit quality | ||
Loans and leases | 3,907,274 | 3,778,070 |
Residential | Non-performing and delinquent | ||
Credit quality | ||
Loans and leases | 14,607 | 18,389 |
Consumer | ||
Credit quality | ||
Loans and leases | 1,527,470 | 1,510,772 |
Consumer loans | Consumer | ||
Credit quality | ||
Loans and leases | 233,318 | 243,512 |
Consumer loans | Consumer | Performing | ||
Credit quality | ||
Loans and leases | 230,121 | 240,185 |
Consumer loans | Consumer | Non-performing and delinquent | ||
Credit quality | ||
Loans and leases | 3,197 | 3,327 |
Consumer - Auto | Consumer | ||
Credit quality | ||
Loans and leases | 964,177 | 922,756 |
Consumer - Auto | Consumer | Performing | ||
Credit quality | ||
Loans and leases | 951,329 | 906,829 |
Consumer - Auto | Consumer | Non-performing and delinquent | ||
Credit quality | ||
Loans and leases | 12,848 | 15,927 |
Credit Cards | Consumer | ||
Credit quality | ||
Loans and leases | 329,975 | 344,504 |
Credit Cards | Consumer | Performing | ||
Credit quality | ||
Loans and leases | 326,581 | 340,801 |
Credit Cards | Consumer | Non-performing and delinquent | ||
Credit quality | ||
Loans and leases | $ 3,394 | $ 3,703 |
Allowance for Loan and Lease 52
Allowance for Loan and Lease Losses - Aging of Analysis of Past Due Loans and Leases (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | $ 34,438 | $ 36,688 |
Current | 12,020,230 | 11,474,260 |
Total Accruing Loans and Leases | 12,054,668 | 11,510,948 |
Total NonAccruing Loans and Leases | 7,724 | 9,430 |
Total loans and leases | 12,062,392 | 11,520,378 |
30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 24,798 | 28,728 |
60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 4,599 | 4,692 |
Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 5,041 | 3,268 |
Commercial and Industrial | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,251 | 1,332 |
Current | 3,326,686 | 3,235,538 |
Total Accruing Loans and Leases | 3,328,937 | 3,236,870 |
Total NonAccruing Loans and Leases | 2,155 | 2,730 |
Total loans and leases | 3,331,092 | 3,239,600 |
Commercial and Industrial | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 791 | 720 |
Commercial and Industrial | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 185 | 163 |
Commercial and Industrial | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,275 | 449 |
Commercial Real Estate | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3,190 | 475 |
Current | 2,542,289 | 2,343,020 |
Total Accruing Loans and Leases | 2,545,479 | 2,343,495 |
Total loans and leases | 2,545,479 | 2,343,495 |
Commercial Real Estate | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3,190 | 475 |
Construction | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 520 | |
Current | 555,274 | 450,012 |
Total Accruing Loans and Leases | 555,794 | 450,012 |
Total loans and leases | 555,794 | 450,012 |
Construction | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 86 | |
Construction | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 84 | |
Construction | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 350 | |
Lease Financing | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 83 | |
Current | 180,676 | 179,804 |
Total Accruing Loans and Leases | 180,676 | 179,887 |
Total NonAccruing Loans and Leases | 153 | |
Total loans and leases | 180,676 | 180,040 |
Lease Financing | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 83 | |
Residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 9,038 | 11,842 |
Current | 3,907,274 | 3,778,070 |
Total Accruing Loans and Leases | 3,916,312 | 3,789,912 |
Total NonAccruing Loans and Leases | 5,569 | 6,547 |
Total loans and leases | 3,921,881 | 3,796,459 |
Residential | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 6,334 | 9,907 |
Residential | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,161 | 1,069 |
Residential | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,543 | 866 |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 19,439 | 22,956 |
Current | 1,508,031 | 1,487,816 |
Total Accruing Loans and Leases | 1,527,470 | 1,510,772 |
Total loans and leases | 1,527,470 | 1,510,772 |
Consumer | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 14,397 | 17,626 |
Consumer | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3,169 | 3,460 |
Consumer | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | $ 1,873 | $ 1,870 |
Allowance for Loan and Lease 53
Allowance for Loan and Lease Losses - Impaired Loans and Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Recorded Investment | |||||
Impaired loans with no related allowance recorded | $ 35,777 | $ 35,777 | $ 43,763 | ||
Impaired loans with a related allowance recorded | 10,049 | 10,049 | 15,665 | ||
Total impaired loans | 45,826 | 45,826 | 59,428 | ||
Unpaid Principal Balance | |||||
Impaired loans with no related allowance recorded | 37,117 | 37,117 | 44,987 | ||
Impaired loans with a related allowance recorded | 10,330 | 10,330 | 16,402 | ||
Total impaired loans | 47,447 | 47,447 | 61,389 | ||
Related Allowance, Impaired loans | 665 | 665 | 1,092 | ||
Average Recorded Investment | |||||
Impaired loans with no related allowance recorded | 38,198 | $ 52,925 | 40,053 | $ 47,635 | |
Impaired loans with a related allowance recorded | 13,761 | 9,749 | 14,395 | 8,862 | |
Total impaired loans | 51,959 | 62,674 | 54,448 | 56,497 | |
Interest Income Recognized | |||||
Impaired loans with no related allowance recorded | 470 | 582 | 964 | 1,178 | |
Impaired loans with a related allowance recorded | 109 | 85 | 261 | 176 | |
Total impaired loans | 579 | 667 | 1,225 | 1,354 | |
Commercial and Industrial | |||||
Recorded Investment | |||||
Impaired loans with no related allowance recorded | 19,129 | 19,129 | 22,404 | ||
Impaired loans with a related allowance recorded | 156 | 156 | 5,168 | ||
Total impaired loans | 19,285 | 19,285 | 27,572 | ||
Unpaid Principal Balance | |||||
Impaired loans with no related allowance recorded | 19,861 | 19,861 | 22,608 | ||
Impaired loans with a related allowance recorded | 156 | 156 | 5,624 | ||
Total impaired loans | 20,017 | 20,017 | 28,232 | ||
Related Allowance, Impaired loans | 5 | 5 | 380 | ||
Average Recorded Investment | |||||
Impaired loans with no related allowance recorded | 20,068 | 30,443 | 20,847 | 25,577 | |
Impaired loans with a related allowance recorded | 3,697 | 892 | 4,187 | 595 | |
Total impaired loans | 23,765 | 31,335 | 25,034 | 26,172 | |
Interest Income Recognized | |||||
Impaired loans with no related allowance recorded | 209 | 338 | 438 | 651 | |
Impaired loans with a related allowance recorded | 3 | 50 | |||
Total impaired loans | 212 | 338 | 488 | 651 | |
Commercial Real Estate | |||||
Recorded Investment | |||||
Impaired loans with no related allowance recorded | 8,348 | 8,348 | 11,598 | ||
Impaired loans with a related allowance recorded | 915 | 915 | 947 | ||
Total impaired loans | 9,263 | 9,263 | 12,545 | ||
Unpaid Principal Balance | |||||
Impaired loans with no related allowance recorded | 8,348 | 8,348 | 11,598 | ||
Impaired loans with a related allowance recorded | 915 | 915 | 947 | ||
Total impaired loans | 9,263 | 9,263 | 12,545 | ||
Related Allowance, Impaired loans | 7 | 7 | 7 | ||
Average Recorded Investment | |||||
Impaired loans with no related allowance recorded | 9,866 | 8,397 | 10,443 | 7,527 | |
Impaired loans with a related allowance recorded | 924 | 932 | |||
Total impaired loans | 10,790 | 8,397 | 11,375 | 7,527 | |
Interest Income Recognized | |||||
Impaired loans with no related allowance recorded | 117 | 140 | 246 | 284 | |
Impaired loans with a related allowance recorded | 11 | 22 | |||
Total impaired loans | 128 | 140 | 268 | 284 | |
Construction | |||||
Average Recorded Investment | |||||
Impaired loans with no related allowance recorded | 283 | 188 | |||
Total impaired loans | 283 | 188 | |||
Interest Income Recognized | |||||
Impaired loans with no related allowance recorded | 8 | ||||
Total impaired loans | 8 | ||||
Lease Financing | |||||
Recorded Investment | |||||
Impaired loans with no related allowance recorded | 153 | ||||
Total impaired loans | 153 | ||||
Unpaid Principal Balance | |||||
Impaired loans with no related allowance recorded | 153 | ||||
Total impaired loans | 153 | ||||
Average Recorded Investment | |||||
Impaired loans with no related allowance recorded | 77 | 176 | 102 | 177 | |
Total impaired loans | 77 | 176 | 102 | 177 | |
Residential | |||||
Recorded Investment | |||||
Impaired loans with no related allowance recorded | 8,300 | 8,300 | 9,608 | ||
Impaired loans with a related allowance recorded | 8,978 | 8,978 | 9,550 | ||
Total impaired loans | 17,278 | 17,278 | 19,158 | ||
Unpaid Principal Balance | |||||
Impaired loans with no related allowance recorded | 8,908 | 8,908 | 10,628 | ||
Impaired loans with a related allowance recorded | 9,259 | 9,259 | 9,831 | ||
Total impaired loans | 18,167 | 18,167 | 20,459 | ||
Related Allowance, Impaired loans | 653 | 653 | $ 705 | ||
Average Recorded Investment | |||||
Impaired loans with no related allowance recorded | 8,187 | 13,626 | 8,661 | 14,166 | |
Impaired loans with a related allowance recorded | 9,140 | 8,857 | 9,276 | 8,267 | |
Total impaired loans | 17,327 | 22,483 | 17,937 | 22,433 | |
Interest Income Recognized | |||||
Impaired loans with no related allowance recorded | 144 | 104 | 280 | 235 | |
Impaired loans with a related allowance recorded | 95 | 85 | 189 | 176 | |
Total impaired loans | $ 239 | $ 189 | $ 469 | $ 411 |
Allowance for Loan and Lease 54
Allowance for Loan and Lease Losses - Troubled Debt Restructuring Modifications (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017USD ($)propertycontract | Jun. 30, 2016USD ($)contract | Jun. 30, 2017USD ($)propertycontract | Jun. 30, 2016USD ($)contract | Dec. 31, 2016USD ($)propertycontract | |
Troubled debt restructuring modifications | |||||
Number of Contracts | contract | 1 | 6 | 3 | 14 | |
Recorded Investment | $ 310 | $ 14,590 | $ 1,813 | $ 25,080 | |
Related Allowance | 10 | 21 | $ 63 | ||
Total loan and lease commitments | 5,154,215 | 5,154,215 | $ 5,121,811 | ||
Commitments related to borrowers who had loan terms modified in a TDR | $ 1,500 | $ 1,500 | 6,900 | ||
Loans modified in TDRs that experienced a payment default | |||||
Period past due for payment default | 30 days | ||||
Number of contracts | contract | 2 | 3 | 1 | ||
Recorded Investment | $ 3,889 | $ 4,399 | $ 2,496 | ||
Commercial and Industrial | |||||
Troubled debt restructuring modifications | |||||
Number of Contracts | contract | 2 | 1 | 4 | ||
Recorded Investment | $ 7,857 | $ 1,150 | $ 15,953 | ||
Total loan and lease commitments | $ 2,180,122 | $ 2,180,122 | 2,185,810 | ||
Loans modified in TDRs that experienced a payment default | |||||
Number of contracts | contract | 1 | 1 | 1 | ||
Recorded Investment | $ 2,496 | $ 2,496 | $ 2,496 | ||
Commercial Real Estate | |||||
Troubled debt restructuring modifications | |||||
Number of Contracts | contract | 2 | 2 | |||
Recorded Investment | $ 5,538 | $ 5,538 | |||
Loans modified in TDRs that experienced a payment default | |||||
Number of contracts | contract | 1 | 1 | |||
Recorded Investment | $ 1,393 | $ 1,393 | |||
Lease Financing | |||||
Troubled debt restructuring modifications | |||||
Total loan and lease commitments | $ 16 | $ 16 | $ 16 | ||
Residential | |||||
Troubled debt restructuring modifications | |||||
Period of time monthly payments are lowered to accommodate borrowers' financial needs | 2 years | ||||
Number of Contracts | contract | 1 | 2 | 2 | 8 | |
Recorded Investment | $ 310 | $ 1,195 | $ 663 | $ 3,589 | |
Related Allowance | $ 10 | $ 21 | $ 63 | ||
Loans modified in TDRs that experienced a payment default | |||||
Number of contracts | contract | 1 | ||||
Recorded Investment | $ 510 | ||||
Number of residential mortgage loans collateralized by real estate property and modified in a TDR in the process of foreclosure | contract | 0 | 0 | 1 | ||
Residential mortgage loans collateralized by real estate property and modified in a TDR in the process of foreclosure | $ 500 | ||||
Residential | Real estate property held from foreclosed TDR | |||||
Loans modified in TDRs that experienced a payment default | |||||
Number of real estate properties | property | 1 | 1 | 1 | ||
Real estate property held from a foreclosed TDR | $ 300 | $ 300 | $ 300 | ||
Consumer | |||||
Troubled debt restructuring modifications | |||||
Total loan and lease commitments | $ 1,481,746 | $ 1,481,746 | $ 1,459,467 | ||
Consumer | Minimum | |||||
Troubled debt restructuring modifications | |||||
Threshold period past due for charge-off | 120 days | ||||
Consumer | Maximum | |||||
Troubled debt restructuring modifications | |||||
Threshold period past due for charge-off | 180 days |
Transfers of Financial Assets -
Transfers of Financial Assets - Carrying Amounts of Assets Pledged as Collateral (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Carrying amounts of the assets pledged as collateral | ||
Public deposits | $ 2,728,505 | $ 2,521,761 |
Federal Home Loan Bank | 2,260,995 | 2,097,233 |
Federal Reserve Bank | 903,335 | 935,672 |
Repurchase agreements | 10,066 | |
ACH transactions | 151,003 | 152,394 |
Interest rate swaps | 35,153 | 30,399 |
Total | 6,078,991 | 5,747,525 |
Securities for reverse repurchase agreements | 0 | 0 |
Extinguishment of debt | ||
In-substance debt defeasance | $ 0 | $ 0 |
Transfers of Financial Assets56
Transfers of Financial Assets - Short-Term Borrowings - Lines of Credit (Details) $ in Millions | Jun. 30, 2017USD ($) |
Federal Home Loan Bank line of credit | |
Lines of credit | |
Amount available | $ 1,800 |
Federal Reserve Bank line of credit | |
Lines of credit | |
Amount available | $ 685.9 |
Transfers of Financial Assets57
Transfers of Financial Assets - Disaggregation of Gross Amount of Recognized Liabilities for Repurchase Agreements by Class of Collateral (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | $ 9,151 |
Collateralized mortgage obligations: Government agency | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 6,151 |
Government-sponsored enterprises mortgage-backed securities | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 3,000 |
Less than 30 days | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 1,200 |
Less than 30 days | Collateralized mortgage obligations: Government agency | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 1,200 |
30 through 90 days | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 2,000 |
30 through 90 days | Government-sponsored enterprises mortgage-backed securities | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 2,000 |
Maturing Over 90 days | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 5,951 |
Maturing Over 90 days | Collateralized mortgage obligations: Government agency | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | 4,951 |
Maturing Over 90 days | Government-sponsored enterprises mortgage-backed securities | |
Disaggregation of the gross amount of recognized liabilities for repurchase agreements by the class of collateral pledged | |
Recognized liabilities for repurchase agreements | $ 1,000 |
Deposits - Categorized by Inter
Deposits - Categorized by Interest-bearing or Noninterest-bearing (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
U.S.: | ||
Interest-bearing | $ 10,903,294 | $ 10,129,958 |
Noninterest-bearing | 5,227,404 | 5,399,212 |
Foreign: | ||
Interest-bearing | 677,370 | 671,957 |
Noninterest-bearing | 644,194 | 593,405 |
Total deposits | $ 17,452,262 | $ 16,794,532 |
Deposits - Maturity Distributio
Deposits - Maturity Distribution of Time Certificates of Deposits (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Maturity distribution of time certificates of deposit | |
Three months or less | $ 1,950,694 |
Over three through six months | 818,785 |
Over six through twelve months | 662,445 |
One to two years | 210,000 |
Two to three years | 172,255 |
Three to four years | 142,260 |
Four to five years | 111,602 |
Thereafter | 18 |
Total | 4,068,059 |
$250000 | |
Maturity distribution of time certificates of deposit | |
Three months or less | 236,404 |
Over three through six months | 269,544 |
Over six through twelve months | 267,980 |
One to two years | 126,118 |
Two to three years | 124,299 |
Three to four years | 92,840 |
Four to five years | 81,989 |
Thereafter | 18 |
Total | 1,199,192 |
$250,000 or More | |
Maturity distribution of time certificates of deposit | |
Three months or less | 1,714,290 |
Over three through six months | 549,241 |
Over six through twelve months | 394,465 |
One to two years | 83,882 |
Two to three years | 47,956 |
Three to four years | 49,420 |
Four to five years | 29,613 |
Total | $ 2,868,867 |
Deposits - Time Certificate Den
Deposits - Time Certificate Denominations and Overdrawn Accounts (Details) - USD ($) $ in Millions | Jun. 30, 2017 | Dec. 31, 2016 |
Deposits | ||
Time certificates of deposit in denominations of $250,000 or more, in the aggregate | $ 2,900 | $ 2,500 |
Overdrawn deposit accounts classified as loans | $ 1.7 | $ 1.5 |
Accumulated Other Comprehensi61
Accumulated Other Comprehensive Loss - Changes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Pre-tax Amount | ||||
Balance | $ (143,296) | $ (30,369) | $ (145,472) | $ (84,722) |
Other comprehensive income | 31,473 | 21,725 | 33,649 | 76,078 |
Balance | (111,823) | (8,644) | (111,823) | (8,644) |
Income Tax Benefit (Expense) | ||||
Balance | 56,604 | 11,996 | 57,461 | 33,463 |
Other comprehensive income | (12,432) | (8,579) | (13,289) | (30,046) |
Balance | 44,172 | 3,417 | 44,172 | 3,417 |
Net of tax | ||||
Balance | 2,476,485 | 2,736,941 | ||
Other comprehensive income | 19,041 | 13,146 | 20,360 | 46,032 |
Balance | 2,552,602 | 2,501,008 | 2,552,602 | 2,501,008 |
Accumulated Other Comprehensive Loss | ||||
Net of tax | ||||
Balance | (86,692) | (18,373) | (88,011) | (51,259) |
Other comprehensive income | 19,041 | 13,146 | 20,360 | 46,032 |
Balance | (67,651) | (5,227) | (67,651) | (5,227) |
Pension and other benefits | ||||
Pre-tax Amount | ||||
Other comprehensive income | (78) | (78) | ||
Income Tax Benefit (Expense) | ||||
Other comprehensive income | 32 | 32 | ||
Net of tax | ||||
Balance | (30,237) | (26,883) | (30,237) | (26,883) |
Other comprehensive income | (46) | (46) | ||
Balance | (30,237) | (26,929) | (30,237) | (26,929) |
Pension and other benefits, change due to the Reorganization Transactions | ||||
Pre-tax Amount | ||||
Unrealized net gains (losses) arising during the period | (78) | (78) | ||
Income Tax Benefit (Expense) | ||||
Unrealized net gains (losses) arising during the period | 32 | 32 | ||
Net of tax | ||||
Unrealized net gains (losses) arising during the period | (46) | (46) | ||
Investment securities | ||||
Pre-tax Amount | ||||
Unrealized net gains (losses) arising during the period | 31,215 | 21,605 | 32,793 | 102,515 |
Reclassification of net gains to net income | (3) | (25,731) | ||
Other comprehensive income | 31,215 | 21,602 | 32,793 | 76,784 |
Income Tax Benefit (Expense) | ||||
Unrealized net gains (losses) arising during the period | (12,330) | (8,535) | (12,951) | (40,493) |
Reclassification of net gains to net income | 10,164 | |||
Other comprehensive income | (12,330) | (8,535) | (12,951) | (30,329) |
Net of tax | ||||
Balance | (59,001) | 8,282 | (59,958) | (25,106) |
Unrealized net gains (losses) arising during the period | 18,885 | 13,070 | 19,842 | 62,022 |
Reclassification of gains to net income | (3) | (15,567) | ||
Other comprehensive income | 18,885 | 13,067 | 19,842 | 46,455 |
Balance | (40,116) | 21,349 | (40,116) | 21,349 |
Cash flow derivative hedges | ||||
Pre-tax Amount | ||||
Unrealized net gains (losses) arising during the period | 258 | 201 | 856 | (628) |
Other comprehensive income | 258 | 201 | 856 | (628) |
Income Tax Benefit (Expense) | ||||
Unrealized net gains (losses) arising during the period | (102) | (76) | (338) | 251 |
Other comprehensive income | (102) | (76) | (338) | 251 |
Net of tax | ||||
Balance | 2,546 | 228 | 2,184 | 730 |
Unrealized net gains (losses) arising during the period | 156 | 125 | 518 | (377) |
Other comprehensive income | 156 | 125 | 518 | (377) |
Balance | $ 2,702 | $ 353 | $ 2,702 | $ 353 |
Accumulated Other Comprehensi62
Accumulated Other Comprehensive Loss - Changes, Net of Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balance | $ 2,476,485 | $ 2,736,941 | ||
Other comprehensive income (loss) | $ 19,041 | $ 13,146 | 20,360 | 46,032 |
Balance | 2,552,602 | 2,501,008 | 2,552,602 | 2,501,008 |
Accumulated Other Comprehensive Loss | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balance | (86,692) | (18,373) | (88,011) | (51,259) |
Other comprehensive income (loss) | 19,041 | 13,146 | 20,360 | 46,032 |
Balance | (67,651) | (5,227) | (67,651) | (5,227) |
Pension and other benefits | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balance | (30,237) | (26,883) | (30,237) | (26,883) |
Other comprehensive income (loss) | (46) | (46) | ||
Balance | (30,237) | (26,929) | (30,237) | (26,929) |
Investment securities | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balance | (59,001) | 8,282 | (59,958) | (25,106) |
Other comprehensive income (loss) | 18,885 | 13,067 | 19,842 | 46,455 |
Balance | (40,116) | 21,349 | (40,116) | 21,349 |
Cash flow derivative hedges | ||||
Changes in the components of accumulated other comprehensive loss, net of taxes | ||||
Balance | 2,546 | 228 | 2,184 | 730 |
Other comprehensive income (loss) | 156 | 125 | 518 | (377) |
Balance | $ 2,702 | $ 353 | $ 2,702 | $ 353 |
Regulatory Capital Requiremen63
Regulatory Capital Requirements (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Common equity tier 1 capital to risk-weighted assets | ||
Actual Amount | $ 1,624,761 | $ 1,569,004 |
Actual Ratio (as a percent) | 12.73% | 12.75% |
Minimum Capital Ratio (as a percent) | 4.50% | 4.50% |
Well-Capitalized Ratio (as a percent) | 6.50% | 6.50% |
Tier 1 capital to risk-weighted assets | ||
Actual Amount | $ 1,624,761 | $ 1,569,004 |
Actual Ratio (as a percent) | 12.73% | 12.75% |
Minimum Capital Ratio (as a percent) | 6.00% | 6.00% |
Well-Capitalized Ratio (percent) | 8.00% | 8.00% |
Total capital to risk-weighted assets | ||
Actual Amount | $ 1,762,244 | $ 1,705,098 |
Actual Ratio (as a percent) | 13.81% | 13.85% |
Minimum Capital Ratio (as a percent) | 8.00% | 8.00% |
Well-Capitalized Ratio (as a percent) | 10.00% | 10.00% |
Tier 1 capital to average assets (leverage ratio) | ||
Actual Amount | $ 1,624,761 | $ 1,569,004 |
Actual Ratio | 8.70% | 8.36% |
Minimum Capital Ratio (as a percent) | 4.00% | 4.00% |
Well-Capitalized Ratio (percent) | 5.00% | 5.00% |
First Hawaiian Bank | ||
Common equity tier 1 capital to risk-weighted assets | ||
Actual Amount | $ 1,615,232 | $ 1,533,056 |
Actual Ratio (as a percent) | 12.67% | 12.51% |
Tier 1 capital to risk-weighted assets | ||
Actual Amount | $ 1,615,232 | $ 1,533,063 |
Actual Ratio (as a percent) | 12.67% | 12.51% |
Total capital to risk-weighted assets | ||
Actual Amount | $ 1,752,715 | $ 1,669,157 |
Actual Ratio (as a percent) | 13.75% | 13.62% |
Tier 1 capital to average assets (leverage ratio) | ||
Actual Amount | $ 1,615,232 | $ 1,533,063 |
Actual Ratio | 8.66% | 8.19% |
Regulatory Capital Requiremen64
Regulatory Capital Requirements - Capital Conservation Buffer (Details) | Jun. 30, 2017 | Jan. 01, 2016 |
Regulatory Capital Requirements | ||
Initial capital conservation buffer (as a percent) | 0.625% | |
Capital conservation buffer annual increase after initial year (as a percent) | 0.625% | |
Capital conservation buffer final level (as a percent) | 2.50% |
Income Taxes - Effective Tax Ra
Income Taxes - Effective Tax Rate (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Taxes | ||||
Effective tax rate (as a percent) | 37.12% | 36.52% | 37.01% | 37.13% |
Income Taxes - Examinations (De
Income Taxes - Examinations (Details) | 6 Months Ended |
Jun. 30, 2017item | |
Income Taxes | |
Number of examinations under way | 0 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Unrecognized Tax Benefits - (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Tax | |||
Balance | $ 127,085 | $ 5,903 | |
Additions for current year tax positions | 1,478 | 6,297 | |
Additions for Reorganization Transactions | 115,877 | ||
Reductions for prior years' tax positions: Expiration of statute of limitations | (254) | (353) | |
Balance | 128,309 | 127,724 | |
Interest and Penalties | |||
Balance | 9,965 | 2,935 | |
Additions for current year tax positions | 1,075 | ||
Additions for Reorganization Transactions | 226 | 5,459 | |
Additions for prior years' tax positions: Accrual of interest and penalties | 209 | 67 | |
Reductions for prior years' tax positions: Expiration of statute of limitations | (101) | (144) | |
Balance | 10,299 | 9,392 | |
Total | |||
Balance | 137,050 | 8,838 | |
Additions for current year tax positions | 1,478 | 7,372 | |
Additions for Reorganization Transactions | 226 | 121,336 | |
Additions for prior years' tax positions: Accrual of interest and penalties | 209 | 67 | |
Reductions for prior years' tax positions: Expiration of statute of limitations | (355) | (497) | |
Balance | 138,608 | 137,116 | |
Unrecognized tax benefits | |||
Amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate | 11,000 | 11,000 | |
Unrecognized tax benefits attributable to tax refund claims in State of California | 93,900 | ||
Unrecognized tax benefits, reasonably possible to decrease within the next 12 months | 107,100 | ||
Unrecognized interest and penalties, reasonably possible to decrease within the next 12 months | 5,200 | ||
Net expense attributable to interest and penalties recorded | 400 | $ 200 | |
Accrued interest and penalties attributable to uncertain tax positions and undisputed tax adjustments | 12,500 | $ 12,100 | |
Accrued interest and penalties attributable to unrecognized tax benefits | $ 10,300 | $ 10,000 |
Income Taxes - Reorganization T
Income Taxes - Reorganization Transactions - (Details) - Reorganization Transactions on April 1, 2016 $ in Millions | Apr. 01, 2016USD ($) |
Income taxes | |
Current tax receivables recorded | $ 72.8 |
Unrecognized tax positions | 116.6 |
Indemnification payable | 28.6 |
Certain tax related liabilities incurred | 95.4 |
Expected federal tax benefit on distribution taxes | $ 33.4 |
Derivative Financial Instrume69
Derivative Financial Instruments - Notional Amounts and Fair Values (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Interest rate swaps | ||
Notional amounts and fair values of derivatives | ||
Financial instruments pledged as collateral | $ 23,900 | $ 12,100 |
Cash pledged as collateral | 11,300 | 18,300 |
Derivatives designated as hedging instruments | Interest rate swaps | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 196,451 | 200,504 |
Derivatives designated as hedging instruments | Interest rate swaps | Other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | (4,149) | (5,296) |
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 1,611,148 | 1,297,101 |
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Other assets | ||
Notional amounts and fair values of derivatives | ||
Asset Derivatives | 19,581 | 15,982 |
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | (14,935) | (18,299) |
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 40,017 | 37,143 |
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | Other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | (6,493) | (7,460) |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 3,376 | 3,664 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Other assets | ||
Notional amounts and fair values of derivatives | ||
Asset Derivatives | $ 79 | |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | $ (147) |
Derivative Financial Instrume70
Derivative Financial Instruments - Fair Value Hedges (Details) - Interest rate swaps - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Net gains and losses recognized in income related to derivatives in fair value hedging relationships | |||||
Net losses recognized on fair value hedges | $ (67) | $ (360) | $ (243) | $ (666) | |
Minimum | Fair value hedges | |||||
Fair hedges carried | |||||
Fixed interest rate (as a percent) | 2.59% | 2.59% | |||
Maximum | Fair value hedges | |||||
Fair hedges carried | |||||
Fixed interest rate (as a percent) | 5.38% | 5.38% | |||
Net interest income | Fair value hedges | |||||
Net gains and losses recognized in income related to derivatives in fair value hedging relationships | |||||
Losses recorded | $ (171) | (297) | $ (369) | (694) | |
Noninterest income | |||||
Net gains and losses recognized in income related to derivatives in fair value hedging relationships | |||||
Recognized on derivatives | (95) | (530) | 124 | (1,518) | |
Recognized on hedged item | 199 | 467 | 2 | 1,546 | |
Net gains recognized on fair value hedges (ineffective portion) | 104 | $ (63) | 126 | $ 28 | |
Derivatives designated as hedging instruments | |||||
Fair hedges carried | |||||
Notional amounts | 196,451 | 196,451 | $ 200,504 | ||
Derivatives designated as hedging instruments | Fair value hedges | |||||
Fair hedges carried | |||||
Notional amounts | 46,500 | 46,500 | 50,500 | ||
Positive fair value | 0 | 0 | 0 | ||
Fair value losses | $ 1,200 | $ 1,200 | $ 1,500 |
Derivative Financial Instrume71
Derivative Financial Instruments - Cash Flow Hedges (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017USD ($)derivative | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)derivative | Jun. 30, 2016USD ($) | Dec. 31, 2016USD ($)derivative | |
Cash Flow Hedges | |||||
Effect of cash flow hedging relationships | |||||
Pretax gains (losses) recognized in other comprehensive loss on derivatives (effective portion) | $ 258 | $ 201 | $ 856 | $ (628) | |
Pretax gain reclassified from accumulated other comprehensive income | 0 | 0 | 0 | 0 | |
Interest rate swaps | |||||
Cash flow hedges | |||||
Recognized expenses related to the ineffective portion | 0 | 0 | 0 | 0 | |
Interest rate swaps | Cash Flow Hedges | |||||
Cash flow hedges | |||||
Net interest expense on derivative | $ 600 | $ 800 | $ 1,300 | $ 1,700 | |
Minimum | Interest rate swaps | Cash Flow Hedges | |||||
Cash flow hedges | |||||
Fixed interest rate (as a percent) | 2.98% | 2.98% | 2.98% | ||
Maximum | Interest rate swaps | Cash Flow Hedges | |||||
Cash flow hedges | |||||
Fixed interest rate (as a percent) | 3.03% | 3.03% | 3.03% | ||
Derivatives designated as hedging instruments | Interest rate swaps | |||||
Cash flow hedges | |||||
Notional amounts | $ 196,451 | $ 196,451 | $ 200,504 | ||
Derivatives designated as hedging instruments | Interest rate swaps | Cash Flow Hedges | |||||
Cash flow hedges | |||||
Number of derivatives carried | derivative | 2 | 2 | 2 | ||
Notional amounts | $ 150,000 | $ 150,000 | $ 150,000 | ||
Fair value losses | $ 3,000 | $ 3,000 | $ 3,800 |
Derivative Financial Instrume72
Derivative Financial Instruments - Interest Rate Lock Commitments (Details) | Jun. 30, 2017USD ($)instrument | Dec. 31, 2016USD ($)instrument |
Free-Standing Derivative Instruments | ||
Loans held for sale | $ | $ 0 | $ 0 |
Interest rate lock commitments | ||
Free-Standing Derivative Instruments | ||
Number of derivative instruments held | instrument | 0 | 0 |
Derivative Financial Instrume73
Derivative Financial Instruments - Derivatives Not Designated as Hedges (Details) - Derivatives Not Designated as Hedging Instruments - Other noninterest income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Interest rate swaps | ||||
Impact on pretax earnings of derivatives not designated as hedges | ||||
Net Gains (Losses) on Derivatives | $ 100 | $ (105) | $ 353 | $ (395) |
Funding Swap (Visa Derivative) | ||||
Impact on pretax earnings of derivatives not designated as hedges | ||||
Net Gains (Losses) on Derivatives | (35) | 19 | (32) | 19 |
Foreign exchange contracts | ||||
Impact on pretax earnings of derivatives not designated as hedges | ||||
Net Gains (Losses) on Derivatives | $ 21 | $ (162) | $ 226 | $ (122) |
Derivative Financial Instrume74
Derivative Financial Instruments - Free-Standing, Contingent Features and Counterparty Credit Risk (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 96 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | |
Derivative financial instruments | |||||||
Counterparty credit risk adjustments | $ 100 | $ 100 | |||||
Visa | Class B shares | |||||||
Derivative financial instruments | |||||||
Number of shares sold | 0 | 274,000 | 0 | 274,000 | 0 | ||
Interest rate swaps | |||||||
Derivative financial instruments | |||||||
Collateral thresholds for derivative agreements with credit risk related contingent features | $ 500 | $ 500 | |||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | |||||||
Derivative financial instruments | |||||||
Notional Amount | 1,611,148 | 1,611,148 | $ 1,297,101 | ||||
Net interest expense on derivative | $ 200 | $ 300 | $ 500 | $ 600 | |||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Minimum | |||||||
Derivative financial instruments | |||||||
Fixed interest rate (as a percent) | 1.23% | 1.23% | 0.77% | ||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Maximum | |||||||
Derivative financial instruments | |||||||
Fixed interest rate (as a percent) | 5.33% | 5.33% | 4.90% | ||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Customer swap program | |||||||
Derivative financial instruments | |||||||
Notional Amount | $ 1,500,000 | $ 1,500,000 | $ 1,200,000 | ||||
Upfront fees on the dealer swap | 1,700 | $ 1,700 | 4,600 | $ 3,700 | |||
Derivative asset value | 19,600 | 19,600 | 16,000 | ||||
Derivative liability value | 13,000 | 13,000 | 16,000 | ||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Other assets | |||||||
Derivative financial instruments | |||||||
Positive fair value, derivative asset | 19,581 | 19,581 | 15,982 | ||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Other liabilities | |||||||
Derivative financial instruments | |||||||
Fair value loss (derivative liability) | 14,935 | 14,935 | 18,299 | ||||
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | |||||||
Derivative financial instruments | |||||||
Notional Amount | 40,017 | 40,017 | 37,143 | ||||
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | Other liabilities | |||||||
Derivative financial instruments | |||||||
Fair value loss (derivative liability) | $ 6,493 | $ 6,493 | $ 7,460 |
Commitments and Contingent Li75
Commitments and Contingent Liabilities - Contingencies (Details) | 6 Months Ended |
Jun. 30, 2017USD ($)item | |
Overdraft fee litigation | |
Contingencies | |
Loss contingency liability | $ | $ 0 |
First Hawaiian Bank | |
Contingencies | |
Number of times a continuous negative balance overdraft fee charges on accounts remaining in negative balance for a seven-day period | item | 1 |
Period for one-time continuous negative balance overdraft fee | 7 days |
Commitments and Contingent Li76
Commitments and Contingent Liabilities - Commitments to Extend Credit, Participations Sold (Details) - USD ($) $ in Millions | Jun. 30, 2017 | Dec. 31, 2016 |
Commitments to extend credit | ||
Commitments | ||
Participations sold to other institutions | $ 66.4 | $ 94.5 |
Standby letters of credit | ||
Commitments | ||
Participations sold to other institutions | $ 17.5 | $ 19 |
Commitments and Contingent Li77
Commitments and Contingent Liabilities - Financial Instruments with Off-Balance Sheet Risk (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Commitments to extend credit | ||
Financial instruments with off-balance sheet risk | ||
Contract amount | $ 5,154,215 | $ 5,121,811 |
Standby letters of credit | ||
Financial instruments with off-balance sheet risk | ||
Contract amount | 73,776 | 60,848 |
Commercial Letters of credit | ||
Financial instruments with off-balance sheet risk | ||
Contract amount | $ 7,093 | $ 6,813 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings per Share | ||||
Adjustments to net income (in dollars) | $ 0 | $ 0 | $ 0 | $ 0 |
Antidilutive securities (in shares) | 0 | 0 | 0 | 0 |
Numerator: | ||||
Net income | $ 56,895 | $ 54,860 | $ 113,635 | $ 120,391 |
Denominator: | ||||
Basic: weighted-average shares outstanding (in shares) | 139,546,615 | 139,459,620 | 139,546,174 | 139,459,620 |
Add: weighted-average equity-based awards (in shares) | 99,502 | 98,383 | ||
Diluted: weighted-average shares outstanding (in shares) | 139,646,117 | 139,459,620 | 139,644,557 | 139,459,620 |
Basic earnings per share (in dollars per share) | $ 0.41 | $ 0.39 | $ 0.81 | $ 0.86 |
Diluted earnings per share (in dollars per share) | $ 0.41 | $ 0.39 | $ 0.81 | $ 0.86 |
Benefit Plans - Components of N
Benefit Plans - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Pension Benefits | ||||
Components of net periodic benefit cost | ||||
Service cost | $ 157 | $ 214 | $ 315 | $ 429 |
Interest cost | 2,042 | 2,157 | 4,083 | 4,314 |
Expected return on plan assets | (1,242) | (1,164) | (2,484) | (2,335) |
Recognized net actuarial loss | 1,999 | 1,774 | 3,998 | 3,545 |
Total net periodic benefit cost | 2,956 | 2,981 | 5,912 | 5,953 |
Other Benefits | ||||
Components of net periodic benefit cost | ||||
Service cost | 179 | 192 | 358 | 384 |
Interest cost | 201 | 211 | 402 | 421 |
Prior service credit | (108) | (107) | (215) | (214) |
Total net periodic benefit cost | $ 272 | $ 296 | $ 545 | $ 591 |
Fair Value - Visa Derivative (D
Fair Value - Visa Derivative (Details) - USD ($) $ in Millions | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value Measurements, Recurring | Level 3 | Funding Swap (Visa Derivative) | ||
Fair value | ||
Derivative Liability | $ 6.5 | $ 7.5 |
Fair Value - Assets and Liabili
Fair Value - Assets and Liabilities Recorded at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Assets | ||
Investment securities | $ 5,126,869 | $ 5,077,514 |
Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 5,126,869 | 5,077,514 |
Other assets | 19,660 | 15,982 |
Liabilities | ||
Other liabilities | (25,577) | (31,202) |
Total | ||
Net Assets (Liabilities) | 5,120,952 | 5,062,294 |
Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 5,126,869 | 5,077,514 |
Other assets | 19,660 | 15,982 |
Liabilities | ||
Other liabilities | (19,084) | (23,742) |
Total | ||
Net Assets (Liabilities) | 5,127,445 | 5,069,754 |
Fair Value Measurements, Recurring | Level 3 | ||
Liabilities | ||
Other liabilities | (6,493) | (7,460) |
Total | ||
Net Assets (Liabilities) | (6,493) | (7,460) |
U.S. Treasury securities | ||
Assets | ||
Investment securities | 396,842 | 392,473 |
U.S. Treasury securities | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 396,842 | 392,473 |
U.S. Treasury securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 396,842 | 392,473 |
Government-sponsored enterprises debt securities | ||
Assets | ||
Investment securities | 245,318 | 242,667 |
Government-sponsored enterprises debt securities | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 245,318 | 242,667 |
Government-sponsored enterprises debt securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 245,318 | 242,667 |
Government agency mortgage-backed securities | ||
Assets | ||
Investment securities | 168,798 | 185,663 |
Government agency mortgage-backed securities | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 168,798 | 185,663 |
Government agency mortgage-backed securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 168,798 | 185,663 |
Government-sponsored enterprises mortgage-backed securities | ||
Assets | ||
Investment securities | 191,617 | 204,385 |
Government-sponsored enterprises mortgage-backed securities | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 191,617 | 204,385 |
Government-sponsored enterprises mortgage-backed securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 191,617 | 204,385 |
Non-government asset-backed securities | ||
Assets | ||
Investment securities | 3,801 | 12,583 |
Non-government asset-backed securities | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 3,801 | 12,583 |
Non-government asset-backed securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 3,801 | 12,583 |
Collateralized mortgage obligations: Government agency | ||
Assets | ||
Investment securities | 3,309,319 | 3,351,822 |
Collateralized mortgage obligations: Government agency | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 3,309,319 | 3,351,822 |
Collateralized mortgage obligations: Government agency | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | 3,309,319 | 3,351,822 |
Collateralized mortgage obligations: Government-sponsored enterprises | ||
Assets | ||
Investment securities | 811,174 | 687,921 |
Collateralized mortgage obligations: Government-sponsored enterprises | Fair Value Measurements, Recurring | ||
Assets | ||
Investment securities | 811,174 | 687,921 |
Collateralized mortgage obligations: Government-sponsored enterprises | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Investment securities | $ 811,174 | $ 687,921 |
Fair Value - Changes in Fair Va
Fair Value - Changes in Fair Value Levels and in Level 3 Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Fair value | ||||
Asset transfers out of Level 1 into Level 2 | $ 0 | $ 0 | $ 0 | $ 0 |
Asset transfers out of Level 2 into Level 1 | 0 | 0 | 0 | 0 |
Asset transfers into (out of) Level 3 | 0 | 0 | 0 | 0 |
Liability transfers out of Level 1 into Level 2 | 0 | 0 | 0 | 0 |
Liability transfers out of Level 2 into Level 1 | 0 | 0 | 0 | 0 |
Other liabilities - derivative | Funding Swap (Visa Derivative) | ||||
Changes in Level 3 liabilities measured at fair value on a recurring basis | ||||
Balance | (6,987) | (8,828) | (7,460) | |
Total net (losses) gains included in other noninterest income | (35) | 19 | (32) | 19 |
Purchases | (8,875) | |||
Settlements | 529 | 433 | 999 | 480 |
Balance | (6,493) | (8,376) | (6,493) | (8,376) |
Total net (losses) gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held | $ (35) | $ 19 | $ (32) | $ 19 |
Fair Value - Financial Instrume
Fair Value - Financial Instruments not Required to be Carried at Fair Value and Off-Balance Sheet Commitments (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Lease and lease commitments excluded | ||
Financing leases | $ 180,700 | $ 180,000 |
Financing lease commitments | 0 | 0 |
Book Value | ||
Financial assets: | ||
Short-term financial assets | 1,227,765 | 1,052,058 |
Loans | 11,881,716 | 11,340,338 |
Financial liabilities: | ||
Deposits | 17,452,262 | 16,794,532 |
Short-term borrowings | 9,151 | |
Book Value | Commitments to extend credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 18,578 | 20,677 |
Book Value | Standby letters of credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 1,077 | 876 |
Book Value | Commercial Letters of credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 18 | 17 |
Estimated Fair Value | ||
Financial assets: | ||
Short-term financial assets | 1,227,764 | 1,052,053 |
Loans | 11,860,477 | 11,306,675 |
Financial liabilities: | ||
Deposits | 17,448,779 | 16,786,880 |
Short-term borrowings | 9,109 | |
Estimated Fair Value | Commitments to extend credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 18,578 | 20,677 |
Estimated Fair Value | Standby letters of credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 1,077 | 876 |
Estimated Fair Value | Commercial Letters of credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 18 | 17 |
Estimated Fair Value | Level 1 | ||
Financial assets: | ||
Short-term financial assets | 355,752 | 253,827 |
Financial liabilities: | ||
Deposits | 13,384,203 | 13,055,935 |
Estimated Fair Value | Level 2 | ||
Financial assets: | ||
Short-term financial assets | 872,012 | 798,226 |
Financial liabilities: | ||
Deposits | 4,064,576 | 3,730,945 |
Short-term borrowings | 9,109 | |
Estimated Fair Value | Level 3 | ||
Financial assets: | ||
Loans | 11,860,477 | 11,306,675 |
Estimated Fair Value | Level 3 | Commitments to extend credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 18,578 | 20,677 |
Estimated Fair Value | Level 3 | Standby letters of credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | 1,077 | 876 |
Estimated Fair Value | Level 3 | Commercial Letters of credit | ||
Off-balance sheet financial instruments: | ||
Off-balance sheet financial instrument amount | $ 18 | $ 17 |
Fair Value - Assets and Liabi84
Fair Value - Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis (Details) - Impaired loans - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Assets with fair value adjustments on a nonrecurring basis | |||
Total impairment losses | $ 500 | $ 200 | |
Fair Value Measurements, Nonrecurring | Level 3 | |||
Assets with fair value adjustments on a nonrecurring basis | |||
Fair value | $ 1,567 |
Fair Value - Significant Unobse
Fair Value - Significant Unobservable Inputs Used in Fair Value Measurements (Details) - Level 3 $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Fair Value Measurements, Nonrecurring | Impaired loans | ||
Significant unobservable inputs used in the fair value measurements | ||
Assets | $ 1,567 | |
Fair Value Measurements, Recurring | Other liabilities - derivative | ||
Significant unobservable inputs used in the fair value measurements | ||
Liabilities | $ (6,493) | $ (7,460) |
Fair Value Measurements, Recurring | Other liabilities - derivative | Discounted cash flow | Weighted Average | ||
Significant unobservable inputs used in the fair value measurements | ||
Expected Conversion Factor | 1.6483 | 1.6483 |
Expected Term | 4 years | 4 years |
Growth Rate (as a percent) | 15.00% | 15.00% |
Reportable Operating Segments -
Reportable Operating Segments - Business Segments (Details) | 6 Months Ended |
Jun. 30, 2017locationsegment | |
Reportable operating segments | |
Number of business segments | segment | 3 |
Retail Banking | |
Reportable operating segments | |
Number of banking locations | location | 62 |
Reportable Operating Segments87
Reportable Operating Segments - Selected Business Segment Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Selected business segment financial information | |||||
Net interest income (expense) | $ 131,254 | $ 120,427 | $ 260,599 | $ 237,739 | |
Provision for loan and lease losses | (4,400) | (1,900) | (8,900) | (2,600) | |
Net interest income after provision for loan and lease losses | 126,854 | 118,527 | 251,699 | 235,139 | |
Noninterest income | 48,870 | 46,371 | 98,277 | 119,890 | |
Noninterest expense | (85,241) | (78,473) | (169,580) | (163,537) | |
Income before provision for income taxes | 90,483 | 86,425 | 180,396 | 191,492 | |
(Provision) benefit for income taxes | (33,588) | (31,565) | (66,761) | (71,101) | |
Net income | 56,895 | 54,860 | 113,635 | 120,391 | |
Total assets | 20,373,974 | 19,052,593 | 20,373,974 | 19,052,593 | $ 19,661,829 |
Retail Banking | |||||
Selected business segment financial information | |||||
Net interest income (expense) | 106,912 | 103,771 | 212,613 | 206,196 | |
Provision for loan and lease losses | (1,626) | (696) | (3,289) | (952) | |
Net interest income after provision for loan and lease losses | 105,286 | 103,075 | 209,324 | 205,244 | |
Noninterest income | 22,381 | 22,525 | 46,000 | 46,155 | |
Noninterest expense | (56,168) | (54,266) | (111,408) | (109,402) | |
Income before provision for income taxes | 71,499 | 71,334 | 143,916 | 141,997 | |
(Provision) benefit for income taxes | (26,485) | (26,067) | (53,218) | (53,055) | |
Net income | 45,014 | 45,267 | 90,698 | 88,942 | |
Total assets | 6,779,914 | 6,841,661 | 6,779,914 | 6,841,661 | |
Commercial Banking | |||||
Selected business segment financial information | |||||
Net interest income (expense) | 27,726 | 28,212 | 55,259 | 55,805 | |
Provision for loan and lease losses | (2,774) | (1,204) | (5,611) | (1,648) | |
Net interest income after provision for loan and lease losses | 24,952 | 27,008 | 49,648 | 54,157 | |
Noninterest income | 18,921 | 16,671 | 36,491 | 33,019 | |
Noninterest expense | (15,758) | (13,106) | (30,807) | (24,884) | |
Income before provision for income taxes | 28,115 | 30,573 | 55,332 | 62,292 | |
(Provision) benefit for income taxes | (10,409) | (11,145) | (20,443) | (23,241) | |
Net income | 17,706 | 19,428 | 34,889 | 39,051 | |
Total assets | 5,408,202 | 4,460,197 | 5,408,202 | 4,460,197 | |
Treasury and Other | |||||
Selected business segment financial information | |||||
Net interest income (expense) | (3,384) | (11,556) | (7,273) | (24,262) | |
Net interest income after provision for loan and lease losses | (3,384) | (11,556) | (7,273) | (24,262) | |
Noninterest income | 7,568 | 7,175 | 15,786 | 40,716 | |
Noninterest expense | (13,315) | (11,101) | (27,365) | (29,251) | |
Income before provision for income taxes | (9,131) | (15,482) | (18,852) | (12,797) | |
(Provision) benefit for income taxes | 3,306 | 5,647 | 6,900 | 5,195 | |
Net income | (5,825) | (9,835) | (11,952) | (7,602) | |
Total assets | $ 8,185,858 | $ 7,750,735 | $ 8,185,858 | $ 7,750,735 |