Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-14585 | |
Entity Registrant Name | FIRST HAWAIIAN, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 99-0156159 | |
Entity Address, Address Line One | 999 Bishop Street, 29th Floor | |
Entity Address, City or Town | Honolulu | |
Entity Address, Postal Zip Code | 96813 | |
Local Phone Number | 525-7000 | |
City Area Code | 808 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | FHB | |
Security Exchange Name | NASDAQ | |
Entity Address, State or Province | HI | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 129,827,968 | |
Current Fiscal Year End Date | --12-31 | |
Entity Central Index Key | 0000036377 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Interest income | ||
Loans and lease financing | $ 134,971 | $ 144,406 |
Available-for-sale securities | 21,210 | 24,486 |
Other | 2,351 | 3,669 |
Total interest income | 158,532 | 172,561 |
Interest expense | ||
Deposits | 15,600 | 23,197 |
Short-term and long-term borrowings | 4,249 | 4,275 |
Total interest expense | 19,849 | 27,472 |
Net interest income | 138,683 | 145,089 |
Provision for credit losses | 41,200 | 5,680 |
Net interest income after provision for loan and lease losses | 97,483 | 139,409 |
Noninterest income | ||
Service charges on deposit accounts | 8,950 | 8,060 |
Credit and debit card fees | 14,949 | 16,655 |
Other service charges and fees | 8,539 | 9,129 |
Trust and investment services income | 9,591 | 8,618 |
Bank-owned life insurance | 2,260 | 3,813 |
Investment securities gains (losses), net | 85 | (2,613) |
Other | 4,854 | 3,410 |
Total noninterest income | 49,228 | 47,072 |
Noninterest expense | ||
Salaries and employee benefits | 44,829 | 44,860 |
Contracted services and professional fees | 16,055 | 13,645 |
Occupancy | 7,243 | 6,986 |
Equipment | 4,708 | 4,284 |
Regulatory assessment and fees | 1,946 | 1,447 |
Advertising and marketing | 1,823 | 1,966 |
Card rewards program | 7,015 | 6,732 |
Other | 12,847 | 12,703 |
Total noninterest expense | 96,466 | 92,623 |
Income before provision for income taxes | 50,245 | 93,858 |
Provision for income taxes | 11,380 | 23,934 |
Net income (loss) | $ 38,865 | $ 69,924 |
Basic earnings per share (in dollars per share) | $ 0.30 | $ 0.52 |
Diluted earnings per share (in dollars per share) | $ 0.30 | $ 0.52 |
Basic weighted-average outstanding shares (in shares) | 129,895,706 | 134,879,336 |
Diluted weighted-average outstanding shares (in shares) | 130,351,585 | 135,198,345 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Consolidated Statements of Comprehensive Income | ||
Net income | $ 38,865 | $ 69,924 |
Other comprehensive income (loss), net of tax: | ||
Net change in pensions and other benefits | (96) | |
Net change in investment securities | 35,974 | 53,441 |
Other comprehensive income | 35,878 | 53,441 |
Total comprehensive income | $ 74,743 | $ 123,365 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and due from banks | $ 353,908 | $ 360,375 |
Interest-bearing deposits in other banks | 698,924 | 333,642 |
Investment securities, at fair value (amortized cost: $4,014,397 as of March 31, 2020 and $4,080,663 as of December 31, 2019) | 4,058,457 | 4,075,644 |
Loans held for sale | 8,180 | 904 |
Loans and leases | 13,380,270 | 13,211,650 |
Less: allowance for credit losses | 166,013 | 130,530 |
Net loans and leases | 13,214,257 | 13,081,120 |
Premises and equipment, net | 321,254 | 316,885 |
Other real estate owned and repossessed personal property | 238 | 319 |
Accrued interest receivable | 43,552 | 45,239 |
Bank-owned life insurance | 455,226 | 453,873 |
Goodwill | 995,492 | 995,492 |
Mortgage servicing rights | 11,979 | 12,668 |
Other assets | 594,424 | 490,573 |
Total assets | 20,755,891 | 20,166,734 |
Deposits: | ||
Interest-bearing | 11,274,463 | 10,564,922 |
Noninterest-bearing | 5,745,539 | 5,880,072 |
Total deposits | 17,020,002 | 16,444,994 |
Short-term borrowings | 400,000 | 400,000 |
Long-term borrowings | 200,019 | 200,019 |
Retirement benefits payable | 138,396 | 138,222 |
Other liabilities | 332,789 | 343,241 |
Total liabilities | 18,091,206 | 17,526,476 |
Commitments and contingent liabilities (Note 13) | ||
Stockholders' equity | ||
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 140,092,172 / 129,827,968 as of March 31, 2020; issued/outstanding: 139,917,150 / 129,928,479 as of December 31, 2019) | 1,401 | 1,399 |
Additional paid-in capital | 2,506,477 | 2,503,677 |
Retained earnings | 429,323 | 437,072 |
Accumulated other comprehensive income (loss), net | 4,129 | (31,749) |
Treasury stock (10,264,204 shares as of March 31, 2020 and 9,988,671 shares as of December 31, 2019) | (276,645) | (270,141) |
Total stockholders' equity | 2,664,685 | 2,640,258 |
Total liabilities and stockholders' equity | $ 20,755,891 | $ 20,166,734 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Consolidated Balance Sheets | ||
Amortized Cost | $ 4,014,397 | $ 4,080,663 |
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) | 140,092,172 | 139,917,150 |
Common stock outstanding (in shares) | 129,827,968 | 129,928,479 |
Treasury stock (in shares) | 10,264,204 | 9,988,671 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated other comprehensive Income (loss) | Treasury Stock | Total |
Balance, beginning at Dec. 31, 2018 | $ 1,397 | $ 2,495,853 | $ 291,919 | $ (132,195) | $ (132,135) | $ 2,524,839 |
Balance (in shares) at Dec. 31, 2018 | 134,874,302 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 69,924 | 69,924 | ||||
Cash dividends declared ($0.26 per share) | (35,067) | (35,067) | ||||
Equity-based awards | $ 2 | 1,917 | (325) | (1,529) | 65 | |
Equity-based awards (in shares) | 137,713 | |||||
Other comprehensive income, net of tax | 53,441 | 53,441 | ||||
Balance, ending at Mar. 31, 2019 | $ 1,399 | 2,497,770 | 326,451 | (78,754) | (133,664) | 2,613,202 |
Balance (in shares) at Mar. 31, 2019 | 135,012,015 | |||||
Balance, beginning at Dec. 31, 2019 | $ 1,399 | 2,503,677 | 437,072 | (31,749) | (270,141) | $ 2,640,258 |
Balance (in shares) at Dec. 31, 2019 | 129,928,479 | 129,928,479 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 38,865 | $ 38,865 | ||||
Cash dividends declared ($0.26 per share) | (33,782) | (33,782) | ||||
Equity-based awards | $ 2 | 2,800 | (315) | (1,504) | 983 | |
Equity-based awards (in shares) | 117,248 | |||||
Common stock repurchased | (5,000) | (5,000) | ||||
Common stock repurchased (in shares) | (217,759) | |||||
Other comprehensive income, net of tax | 35,878 | 35,878 | ||||
Balance, ending at Mar. 31, 2020 | $ 1,401 | $ 2,506,477 | 429,323 | $ 4,129 | $ (276,645) | $ 2,664,685 |
Balance (in shares) at Mar. 31, 2020 | 129,827,968 | 129,827,968 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Cumulative-effect adjustment of change in accounting principle, net of tax: ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments | $ (12,517) | $ (12,517) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Consolidated Statements of Stockholders' Equity | ||
Cash dividends declared (in dollars per share) | $ 0.26 | $ 0.26 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 38,865 | $ 69,924 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||
Provision for credit losses | 41,200 | 5,680 |
Depreciation, amortization and accretion, net | 17,121 | 14,588 |
Deferred income taxes | 6,624 | 16,461 |
Stock-based compensation | 2,802 | 1,594 |
Other gains | (15) | (26) |
Originations of loans held for sale | (41,062) | (745) |
Proceeds from sales of loans held for sale | 35,435 | 1,199 |
Net gains on sales of loans originated for investment and held for sale | (2,459) | (22) |
Net (gains) losses on investment securities | (85) | 2,613 |
Change in assets and liabilities: | ||
Net increase in other assets | (22,164) | (1,293) |
Net decrease in other liabilities | (128,111) | (46,569) |
Net cash (used in) provided by operating activities | (51,849) | 63,404 |
Available-for-sale securities: | ||
Proceeds from maturities and principal repayments | 259,447 | 142,954 |
Proceeds from calls and sales | 78,472 | 863,053 |
Purchases | (272,324) | (927,606) |
Other investments: | ||
Proceeds from sales | 8,492 | 2,063 |
Purchases | (9,196) | (2,211) |
Loans: | ||
Net increase in loans and leases resulting from originations and principal repayments | (276,113) | (51,823) |
Proceeds from sales of loans originated for investment | 132,011 | |
Purchases of loans | (30,244) | (76,451) |
Proceeds from bank-owned life insurance | 906 | 1,953 |
Purchases of premises, equipment and software | (14,728) | (9,571) |
Proceeds from sales of premises and equipment | 185 | |
Proceeds from sales of other real estate owned | 69 | 653 |
Other | (1,035) | (768) |
Net cash used in investing activities | (124,058) | (57,754) |
Cash flows from financing activities | ||
Net increase (decrease) in deposits | 575,008 | (354,824) |
Dividends paid | (33,782) | (35,067) |
Stock tendered for payment of withholding taxes | (1,504) | (1,529) |
Common stock repurchased | (5,000) | |
Net cash provided by (used in) financing activities | 534,722 | (391,420) |
Net increase (decrease) in cash and cash equivalents | 358,815 | (385,770) |
Cash and cash equivalents at beginning of period | 694,017 | 1,003,637 |
Cash and cash equivalents at end of period | 1,052,832 | 617,867 |
Supplemental disclosures | ||
Interest paid | 24,163 | 27,398 |
Income taxes paid, net of income tax refunds | 5,165 | $ 4,883 |
Noncash investing and financing activities: | ||
Transfers from loans and leases to loans held for sale | $ 131,201 |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization and Basis of Presentation. | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation First Hawaiian, Inc. (“FHI” or the “Parent”), 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. FHB offers a comprehensive suite of banking services to consumer and commercial customers including loans, deposit products, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. The accompanying unaudited interim 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 interim 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, 2019. 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. Investment Securities As of March 31, 2020 and December 31, 2019, investment securities were comprised of debt, mortgage-backed securities and collateralized mortgage obligations issued by the U.S. Government, its agencies and government-sponsored enterprises. The Company amortizes premiums and accretes discounts using the interest method over the expected lives of the individual securities. Premiums on callable debt securities are amortized to their earliest call date. All investment securities transactions are recorded on a trade-date basis. All of the Company’s investment securities were categorized as available-for-sale as of March 31, 2020 and December 31, 2019. Available-for-sale investment securities are reported at fair value, with unrealized gains and losses reported in accumulated other comprehensive income. Gains and losses realized on sales of investment securities are determined using the specific identification method. For available-for-sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For available-for-sale debt securities that do not meet the aforementioned criteria, the Company evaluates at the individual security level whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. Changes in the allowance for credit losses, if any, are recorded as a provision for (or reversal of) credit losses. Losses are charged against the allowance when management believes the uncollectibility of an available-for-sale investment security is confirmed or when either of the criteria regarding intent or requirement to sell is met. As noted above, as of March 31, 2020, the Company’s available-for-sale investment securities were comprised entirely of debt, mortgage-backed securities and collateralized mortgage obligations issued by the U.S. Government, its agencies and government-sponsored enterprises. Management has concluded that the long history with no credit losses from these issuers indicates an expectation that nonpayment of the amortized cost basis is zero. The Company’s available-for-sale investment securities are explicitly or implicitly fully guaranteed by the U.S. government. The U.S. government can print its own currency and its currency is routinely held by central banks and other major financial institutions. The dollar is used in international commerce, and commonly is viewed as a reserve currency, all of which qualitatively indicates that historical credit loss information should be minimally affected by current conditions and reasonable and supportable forecasts. Thus, the Company has not Accrued interest receivable related to available-for-sale investment securities was $8.5 million as of March 31, 2020 and is recorded separately from the amortized cost basis of investment securities on the Company’s interim consolidated balance sheet. Loans and Leases Loans are reported at amortized cost which includes the principal amount outstanding, net of deferred loan fees and costs and cumulative net charge-offs. Interest income is recognized on an accrual basis. Loan origination fees, certain direct costs and unearned discounts and premiums, if any, are deferred and are generally accreted or amortized into interest income as yield adjustments using the interest method over the contractual life of the loan. Other credit-related fees are recognized as fee income, a component of noninterest income, when earned. Direct financing leases are carried at the aggregate of lease payments receivable plus the estimated residual value of leased property, less unearned income. Unearned income on direct financing leases is amortized over the lease term by methods that approximate the interest method. Residual values on leased assets are periodically reviewed for impairment. Accrued interest receivable related to loans and leases was $35.1 million as of March 31, 2020 and is recorded separately from the amortized cost basis of loans and leases on the Company’s interim consolidated balance sheet. Nonaccrual Loans and Leases The Company generally places a loan or lease 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. A full or partial charge-off is recorded in the period in which the loan or lease is deemed uncollectible. When the Company places a loan or lease on nonaccrual status, previously accrued and uncollected interest is concurrently reversed against interest income. When the Company receives an interest payment on a nonaccrual loan or lease, the payment is applied as a reduction of the principal balance. Nonaccrual loans and leases are generally returned to accrual status when they become current as to principal and interest and future payments are reasonably assured. Allowance for Credit Losses The allowance for credit losses for loans and leases (the “ACL”) is a valuation account that is deducted from the amortized cost basis of loans and leases to present the net amount expected to be collected from loans and leases. Loans and leases are charged-off against the ACL when management believes the uncollectibility of a loan or lease balance is confirmed. Expected recoveries do not exceed the aggregate of amounts previously charged-off and expected to be charged-off. The Company’s ACL and the reserve for unfunded commitments under the Current Expected Credit Losses (“CECL”) approach utilizes both quantitative and qualitative components. The Company’s methodology utilizes a quantitative model based on a single forward-looking macroeconomic forecast. The quantitative estimation is overlaid with qualitative adjustments to account for current conditions and forward-looking events not captured in the quantitative model. Qualitative adjustments that are considered include adjustments for regulatory determinants, model limitations, model maturity, and other current or forecasted events that are not captured in the Company’s historical loss experience. The Company generally evaluates loans and leases on a collective or pool basis when similar risk characteristics exist. However, loans and leases that do not share similar risk characteristics are evaluated on an individual basis. Such loans and leases evaluated individually are excluded from the collective evaluation. Individually assessed loans are measured for estimated credit loss (“ECL”) based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral, less estimated selling costs, if the loan is collateral-dependent. Management reviews relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts about the future. Historical credit loss experience provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for differences in current loan-specific risk characteristics such as differences in underwriting standards, portfolio mix, delinquency levels, or term as well as for changes in environmental conditions, such as changes in unemployment rates, property values, or other relevant factors. The Company utilizes a Probability of Default (“PD”)/Loss Given Default (“LGD”) framework to estimate the ACL and the reserve for unfunded commitments. The PD represents the percentage expectation to default, measured by assessing loans and leases that migrate to default status (i.e., nonaccrual status, troubled debt restructurings (“TDRs”), 90 days or more past due, partial or full charge-offs or bankruptcy). LGD is defined as the percentage of the exposure at default (“EAD”) lost at the time of default, net of any recoveries, and will be unique to each of the collateral types securing the Company’s loans. PD and LGD’s are based on past experience of the Company and management’s expectations of the future. The ECL on loans and leases is calculated by taking the product of the credit exposure, lifetime default probability (“LDP”) and the LGD. The ECL model is applied to current credit exposures at the account level, using assumptions calibrated at the portfolio segment level using internal historical loan and lease level data. The Company estimates the default risk of a credit exposure over the remaining life of each account using a transition probability matrix approach which captures both the average rate of up/down-grade and default transitions, as well as withdrawal rates which capture the historical rate of exposure decline due to loan and lease amortization and prepayment. To apply the transition matrices, each credit exposure’s remaining life is split into two time segments. The first time segment is for the reasonable and supportable forecast period over which the transition matrices which are applied have been adjusted to incorporate current and forecasted conditions over that period. Management has determined that using a one year time horizon for the reasonable and supportable forecast period for all classes of loans and leases is a reasonable forecast horizon given the difficulty in predicting future economic conditions with a high degree of certainty. The second time segment is the reversion period from the end of the reasonable and supportable forecast period to the maturity of the exposure, over which long-run average transition matrices are applied. Management elected to use an immediate reversion to the mean approach. Lifetime loss rates are applied against the amortized cost basis of loans and leases and unfunded commitments to estimate the ACL and the reserve for unfunded commitments. On a quarterly basis, management convenes the Bank’s forecasting team which is responsible for qualitatively forecasting the economic outlook over the reasonable and supportable forecast period within the context of forecasting credit losses. Management reviews local and national economic forecasts and other pertinent materials to inform the team in establishing their best estimate of the economic outlook over the reasonable and supportable forecast period. The team considers unemployment rates, gross domestic product, personal income per capita, visitor arrivals and expenditures and home prices along with other relevant information. The results from the Bank’s forecasting team dictates the direction of the economic forecast compared to current economic conditions (i.e., better or worse) and the magnitude of the forecast adjustment (e.g., mild, medium or severe). The direction of the economic forecast and magnitude are used to qualitatively adjust the modifier that is applied to the long-run default rates over the reasonable and supportable forecast period. The Company has identified three portfolio segments in estimating the ACL: commercial, residential real estate and consumer lending. The Company’s commercial portfolio segment is comprised of four distinct classes: commercial and industrial loans, commercial real estate loans, construction loans and lease financing. The key risk drivers related to this portfolio segment include risk rating, collateral type, and remaining maturity. The Company’s residential real estate portfolio segment is comprised of two distinct classes: residential real estate loans and home equity lines of credit. Specific risk characteristics related to this portfolio include the value of the underlying collateral, credit score and remaining maturity. Finally, the Company’s consumer portfolio segment is not further segmented, but consists primarily of automobile loans, credit cards and other installment loans. Automobile loans constitute the majority of this segment and are monitored using credit scores, collateral values and remaining maturity. The remainder of the consumer portfolio is predominantly unsecured. Reserve for Unfunded Commitments The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Company. The reserve for unfunded commitments is adjusted through the provision for credit losses. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. Accounting Standards Adopted in 2020 In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments The implementation of CECL required significant operational changes, particularly in data collection and analysis. The Company formed a working group comprised of teams from different disciplines, including credit, finance and information technology, to evaluate the requirements of the new standard and the impact it will have on the Company’s existing processes. The Company also engaged a software vendor and had run several CECL parallel run productions during 2019. The Company adopted the provisions of ASU No. 2016-13 and related amendments by recording a cumulative effect adjustment to retained earnings as of January 1, 2020. Note that the Company did not opt to delay the implementation of CECL requirements as permitted under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which allows entities to delay implementation until the earlier of (1) the date on which the national emergency concerning the Coronavirus Disease 2019 (“COVID-19”) terminates, or (2) December 31, 2020. The following table presents the impact of adopting ASC Topic 326 as of January 1, 2020: Prior to the Adjustment Adoption of to Adopt After Adoption of (dollars in thousands) ASC Topic 326 ASC Topic 326 ASC Topic 326 Assets: Allowance for Credit Losses - Loans and Leases $ 130,530 $ 770 $ 131,300 Liabilities: Reserve for Unfunded Commitments (1) 600 16,300 16,900 Pretax Cumulative Effect Adjustment of a Change in Accounting Principle 17,070 Less: Income Taxes (4,553) Cumulative-Effect Adjustment of a Change in Accounting Principle, Net of Tax $ 12,517 (1) The reserve for unfunded commitments is included as a component of other liabilities in the Company's interim consolidated balance sheets. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement Recent Accounting Pronouncements The following ASU has been issued by the FASB and is applicable to the Company in future reporting periods. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting elect any of the optional expedients provided for by this guidance. The Company is in the process of evaluating the optional expedients and the impact that this new guidance may have on the Company’s consolidated financial statements. |
Investment Securities
Investment Securities | 3 Months Ended |
Mar. 31, 2020 | |
Investment Securities | |
Investment Securities | 2. Investment Securities As of March 31, 2020 and December 31, 2019, investment securities consisted predominantly of the following investment categories: U.S. Treasury and debt securities Mortgage-backed securities Collateralized mortgage obligations As of March 31, 2020 and December 31, 2019, all of the Company’s investment securities were classified as available-for-sale. Amortized cost and fair value of securities as of March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Cost Gains Losses Value U.S. Treasury securities $ 30,483 $ 444 $ — $ 30,927 $ 29,832 $ 56 $ — $ 29,888 Government-sponsored enterprises debt securities 26,705 16 — 26,721 101,697 19 (277) 101,439 Mortgage-backed securities: Residential - Government agency 269,947 9,016 — 278,963 290,131 2,224 (1,146) 291,209 Residential - Government-sponsored enterprises 403,682 14,289 (304) 417,667 395,039 6,126 (1,673) 399,492 Commercial - Government-sponsored enterprises 184,635 3,345 (1,196) 186,784 101,798 555 (634) 101,719 Collateralized mortgage obligations: Government agency 2,304,803 21,408 (5,333) 2,320,878 2,390,143 7,483 (16,348) 2,381,278 Government-sponsored enterprises 794,142 5,965 (3,590) 796,517 772,023 2,505 (3,909) 770,619 Total available-for-sale securities $ 4,014,397 $ 54,483 $ (10,423) $ 4,058,457 $ 4,080,663 $ 18,968 $ (23,987) $ 4,075,644 Proceeds from calls and sales of investment securities were $75.0 million and $3.5 million, respectively, for the three months ended March 31, 2020, and nil and $863.1 million, respectively, for the three months ended March 31, 2019. The Company recorded gross realized gains of $0.1 million and gross realized losses of nil for the three months ended March 31, 2020. The Company recorded gross realized gains of nil and gross realized losses of $2.6 million for the three months ended March 31, 2019. The income tax benefit related to the Company’s net realized loss on the sale of investment securities was nil and $0.7 million for three months ended March 31, 2020 and 2019, respectively. The income tax expense related to the net realized gains on the sale of investment securities was nil during both the three months ended March 31, 2020 and 2019. Gains and losses realized on sales of securities are determined using the specific identification method. Interest income from taxable investment securities was $21.2 million and $24.5 million for the three months ended March 31, 2020 and 2019, respectively. Interest income from non-taxable investment securities was nil during both the three months ended March 31, 2020 and 2019. The amortized cost and fair value of debt securities issued by the U.S. Treasury and government-sponsored enterprises as of March 31, 2020, by contractual maturity, are shown below. Mortgage-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. March 31, 2020 Amortized Fair (dollars in thousands) Cost Value Due in one year or less $ — $ — Due after one year through five years 57,188 57,648 Due after five years through ten years — — Due after ten years — — 57,188 57,648 Mortgage-backed securities: Residential - Government agency 269,947 278,963 Residential - Government-sponsored enterprises 403,682 417,667 Commercial - Government-sponsored enterprises 184,635 186,784 Total mortgage-backed securities 858,264 883,414 Collateralized mortgage obligations: Government agency 2,304,803 2,320,878 Government-sponsored enterprises 794,142 796,517 Total collateralized mortgage obligations 3,098,945 3,117,395 Total available-for-sale securities $ 4,014,397 $ 4,058,457 At March 31, 2020, pledged securities totaled $2.2 billion, of which $2.0 billion was pledged to secure public deposits and $246.8 million was pledged to secure other financial transactions. At December 31, 2019, pledged securities totaled $1.8 billion, of which $1.5 billion was pledged to secure public deposits and $242.3 million was pledged to secure other financial transactions. The Company held no securities of any single issuer, other than debt securities issued by the U.S. government, government agencies and government-sponsored enterprises, taken in the aggregate, which were in excess of 10% of stockholders’ equity as of March 31, 2020 and December 31, 2019. The following table presents the unrealized gross losses and fair values of securities in the available-for-sale portfolio by length of time that the 55 and 118 individual securities in each category have been in a continuous loss position as of March 31, 2020 and December 31, 2019, respectively. The unrealized losses on investment securities were 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. At March 31, 2020, the Company did not have any securities with 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. Time in Continuous Loss as of March 31, 2020 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value Mortgage-backed securities: Residential - Government-sponsored enterprises $ (211) $ 95,144 $ (93) $ 10,191 $ (304) $ 105,335 Commercial - Government-sponsored enterprises (1,196) 95,097 — — (1,196) 95,097 Collateralized mortgage obligations: Government agency (3,979) 480,482 (1,354) 94,077 (5,333) 574,559 Government-sponsored enterprises (1,242) 144,625 (2,348) 149,246 (3,590) 293,871 Total available-for-sale securities with unrealized losses $ (6,628) $ 815,348 $ (3,795) $ 253,514 $ (10,423) $ 1,068,862 Time in Continuous Loss as of December 31, 2019 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value Government-sponsored enterprises debt securities $ (277) $ 49,716 $ — $ — $ (277) $ 49,716 Mortgage-backed securities: Residential - Government agency — — (1,146) 109,614 (1,146) 109,614 Residential - Government-sponsored enterprises (115) 76,481 (1,558) 109,025 (1,673) 185,506 Commercial - Government-sponsored enterprises (634) 38,062 — — (634) 38,062 Collateralized mortgage obligations: Government agency (8,049) 969,762 (8,299) 565,764 (16,348) 1,535,526 Government-sponsored enterprises (583) 180,785 (3,326) 209,752 (3,909) 390,537 Total available-for-sale securities with unrealized losses $ (9,658) $ 1,314,806 $ (14,329) $ 994,155 $ (23,987) $ 2,308,961 Visa Class B Restricted Shares In 2008, the Company received 394,000 Visa Class B restricted shares as part of Visa’s IPO. 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. In 2016, the Company recorded a $22.7 million net realized gain related to the sale of 274,000 Visa Class B restricted shares. 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 rate to unrestricted Class A common shares. On June 28, 2018, Visa additionally funded its litigation escrow account, thereby reducing each member bank’s Class B conversion rate to unrestricted Class A common shares. Accordingly, on July 5, 2018, Visa announced a decrease in conversion rate from 1.6483 to 1.6298, effective June 28, 2018. In July 2018, the Company made a payment of approximately $0.7 million to the buyer as a result of the reduction in the Visa Class B conversion rate. On September 27, 2019, Visa additionally funded its litigation escrow account, thereby further reducing each member bank’s Class B conversion rate to unrestricted Class A common shares. Accordingly, on September 30, 2019, Visa announced a decrease in conversion rate from 1.6298 to 1.6228, effective September 27, 2019. In October 2019, the Company made a payment of approximately $0.3 million to the buyer as a result of the reduction in the Visa Class B conversion rate. See “Note 12. Derivative Financial Instruments” for more information. The Company held approximately 120,000 Visa Class B restricted shares as of both March 31, 2020 and December 31, 2019. These shares continued to be carried at $0 cost basis during each of the respective periods. |
Loans and Leases
Loans and Leases | 3 Months Ended |
Mar. 31, 2020 | |
Loans and Leases. | |
Loans and Leases | 3. Loans and Leases As of March 31, 2020 and December 31, 2019, loans and leases were comprised of the following: March 31, December 31, (dollars in thousands) 2020 2019 Commercial and industrial $ 3,025,345 $ 2,743,242 Commercial real estate 3,413,014 3,463,953 Construction 572,062 519,241 Residential: Residential mortgage 3,673,455 3,768,936 Home equity line 891,698 893,239 Total residential 4,565,153 4,662,175 Consumer 1,568,073 1,620,556 Lease financing 236,623 202,483 Total loans and leases $ 13,380,270 $ 13,211,650 As of March 31, 2020, residential real estate loans totaling $3.0 billion were pledged to collateralize the Company’s borrowing capacity at the Federal Home Loan Bank of Des Moines (“FHLB”), and consumer, commercial and industrial and commercial real estate loans totaling $1.3 billion were pledged to collateralize the Company’s borrowing capacity at the Federal Reserve Bank of San Francisco (“FRB”). As of December 31, 2019, residential real estate loans totaling $2.9 billion were pledged to collateralize the Company’s borrowing capacity at the FHLB, and consumer, commercial and industrial and commercial real estate loans totaling $953.2 million were pledged to collateralize the Company’s borrowing capacity at the FRB. Residential real estate loans collateralized by properties that were in the process of foreclosure totaled $3.1 million and $4.1 million as of March 31, 2020 and December 31, 2019, 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. |
Allowance for Credit Losses
Allowance for Credit Losses | 3 Months Ended |
Mar. 31, 2020 | |
Allowance for Credit Losses | |
Allowance for Credit Losses | 4. Allowance for Credit Losses The Company maintains an ACL that is deducted from the amortized cost basis of loans and leases to present the net carrying value of loans and leases expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount of loans and leases. The Company also maintains an estimated reserve for unfunded commitments on the unaudited interim consolidated balance sheets. The reserve for unfunded commitments is reduced in the period in which the OBS financial instruments expire, loan funding occurs, or is otherwise settled. The U.S. has been operating under a presidentially declared emergency since March 13, 2020 (the “National Emergency”) as a result of COVID-19. On March 27, 2020, the CARES Act was signed into law. The CARES Act creates a forbearance program for federally backed mortgage loans, protects borrowers from negative credit reporting due to loan accommodations related to the National Emergency, and provides financial institutions the option to temporarily suspend certain requirements under GAAP related to TDRs for a limited period of time to account for the effects of COVID-19. Financial institutions accounting for eligible loans under the CARES Act are not required to report such loans as TDRs in accordance with GAAP. In addition, Interagency Statements were issued on March 22, 2020 and April 7, 2020 to encourage financial institutions to work prudently with borrowers and to describe the agencies’ interpretation of how current accounting rules under GAAP apply to certain COVID-19 related modifications. The agencies confirmed with the FASB that short-term modifications (e.g., six months or less) for payment deferrals, fee waivers, extensions of repayment terms, or delays in payment that are insignificant and made on a good faith basis in response to borrowers impacted by COVID-19 who were current prior to any relief are not TDRs under GAAP. The agencies also confirmed that these short-term modifications should not be reported as being on nonaccrual status and should not be considered past due during the period of the deferral. Rollforward of the Allowance for Credit Losses The following presents the activity in the ACL by class of loans and leases for the three months ended March 31, 2020: Three Months Ended March 31, 2020 Commercial Lending Residential Lending Commercial Commercial Home and Real Lease Residential Equity (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Unallocated Total Allowance for credit losses: Balance at beginning of period $ 28,975 $ 22,325 $ 4,844 $ 424 $ 29,303 $ 9,876 $ 34,644 $ 139 $ 130,530 Adoption of ASU No. 2016-13 (16,105) 10,559 (1,803) 207 (2,793) (4,731) 15,575 (139) 770 Charge-offs (201) — — — — (8) (8,597) — (8,806) Recoveries 220 — 110 — 135 122 2,083 — 2,670 Increase in Provision 7,995 9,954 5,673 220 3,376 1,297 12,334 — 40,849 Balance at end of period $ 20,884 $ 42,838 $ 8,824 $ 851 $ 30,021 $ 6,556 $ 56,039 $ — $ 166,013 The following presents the activity in the ACL by class of loans and leases for the three months ended March 31, 2019, presented in accordance with Topic 310, Receivables Three Months Ended March 31, 2019 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for credit losses: Balance at beginning of period $ 34,501 $ 19,725 $ 5,813 $ 432 $ 44,906 $ 35,813 $ 528 $ 141,718 Charge-offs — — — (24) — (8,598) — (8,622) Recoveries 37 31 — — 250 2,452 — 2,770 Increase (decrease) in Provision (2,745) 1,441 (432) 3 (245) 5,432 2,226 5,680 Balance at end of period $ 31,793 $ 21,197 $ 5,381 $ 411 $ 44,911 $ 35,099 $ 2,754 $ 141,546 The disaggregation of the ACL and recorded investment in loans by impairment methodology as of December 31, 2019, presented in accordance with Topic 310, Receivables December 31, 2019 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for credit losses: Individually evaluated for impairment $ 46 $ 27 $ — $ — $ 130 $ — $ — $ 203 Collectively evaluated for impairment 28,929 22,298 4,844 424 39,049 34,644 139 130,327 Balance at end of period $ 28,975 $ 22,325 $ 4,844 $ 424 $ 39,179 $ 34,644 $ 139 $ 130,530 Loans and leases: Individually evaluated for impairment $ 4,951 $ 723 $ — $ — $ 14,964 $ — $ — $ 20,638 Collectively evaluated for impairment 2,738,291 3,463,230 519,241 202,483 4,647,211 1,620,556 — 13,191,012 Balance at end of period $ 2,743,242 $ 3,463,953 $ 519,241 $ 202,483 $ 4,662,175 $ 1,620,556 $ — $ 13,211,650 Rollforward of the Reserve for Unfunded Commitments The following presents the activity in the Reserve for Unfunded Commitments for the three months ended March 31, 2020: Three Months Ended March 31, 2020 Commercial Lending Residential Lending Commercial Commercial Home and Real Lease Residential Equity (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Total Reserve for unfunded commitments: Balance at beginning of period $ — $ — $ — $ — $ — $ — $ 600 $ 600 Adoption of ASU No. 2016-13 5,390 778 4,119 — 7 6,587 (581) 16,300 Increase (decrease) in Provision (599) (82) 694 — (6) 340 4 351 Balance at end of period $ 4,791 $ 696 $ 4,813 $ — $ 1 $ 6,927 $ 23 $ 17,251 Credit Quality Information The Company performs an internal loan review and grading or scoring procedures 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 or scoring procedures is to identify, in a timely manner, existing or emerging credit quality issues so that appropriate steps can be initiated to avoid or minimize future losses. Loans and leases subject to grading primarily include: commercial and industrial loans, commercial real estate loans, construction loans and lease financing. Other loans subject to grading include installment loans to businesses or individuals for business and commercial purposes, overdraft lines of credit, commercial credit cards, and other credits as may be determined. Credit quality indicators for internally graded loans and leases are generally updated on an annual basis or on a quarterly basis for those loans and leases deemed to be of potentially higher risk. An internal 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 factors of a borrower: character, earnings and operating cash flow, asset and liability structure, debt capacity, management and controls, borrowing entity, and industry and operating environment. Pass Special Mention Substandard Doubtful Loss Loans that are primarily monitored for credit quality using FICO scores include: residential real estate loans, home equity lines and consumer loans. FICO scores are calculated primarily based on a consideration of payment history, the current amount of debt, the length of credit history available, a recent history of new sources of credit and the mix of credit type. FICO scores are updated on a monthly, quarterly or bi-annual basis, depending on the product type. The amortized cost basis by year of origination and credit quality indicator of the Company's loans and leases as of March 31, 2020 was as follows: Revolving Loans Converted Term Loans Revolving to Term Amortized Cost Basis by Origination Year Loans Loans Amortized Amortized (dollars in thousands) 2020 2019 2018 2017 2016 Prior Cost Basis Cost Basis Total Commercial Lending Commercial and Industrial Risk rating: Pass $ 96,493 $ 364,221 $ 294,506 $ 86,993 $ 72,683 $ 210,731 $ 1,542,232 $ 62,021 $ 2,729,880 Special Mention 126 3,490 2,757 360 535 7,064 88,787 256 103,375 Substandard 160 7,456 3,568 1,569 57 5,465 50,830 969 70,074 Other (1) 7,239 18,375 13,894 8,985 3,859 1,247 68,417 — 122,016 Total Commercial and Industrial 104,018 393,542 314,725 97,907 77,134 224,507 1,750,266 63,246 3,025,345 Commercial Real Estate Risk rating: Pass 70,775 731,880 577,488 497,579 324,782 1,024,477 47,680 2 3,274,663 Special Mention — 8,810 17,407 23,558 28,562 27,346 2,999 — 108,682 Substandard — 24,404 — — 426 4,325 — — 29,155 Other (1) — — — — — 514 — — 514 Total Commercial Real Estate 70,775 765,094 594,895 521,137 353,770 1,056,662 50,679 2 3,413,014 Construction Risk rating: Pass 15,537 96,333 192,397 99,207 25,151 53,105 25,991 — 507,721 Special Mention — — — — — — 200 — 200 Substandard — — — 2,219 — 1,002 — — 3,221 Other (1) 2,269 31,408 14,370 6,562 1,735 4,576 — — 60,920 Total Construction 17,806 127,741 206,767 107,988 26,886 58,683 26,191 — 572,062 Lease Financing Risk rating: Pass 49,616 73,066 17,998 22,263 5,939 66,866 — — 235,748 Special Mention — 287 84 440 — 64 — — 875 Total Lease Financing 49,616 73,353 18,082 22,703 5,939 66,930 — — 236,623 Total Commercial Lending $ 242,215 $ 1,359,730 $ 1,134,469 $ 749,735 $ 463,729 $ 1,406,782 $ 1,827,136 $ 63,248 $ 7,247,044 (continued) Revolving Loans Converted Term Loans Revolving to Term Amortized Cost Basis by Origination Year Loans Loans (continued) Amortized Amortized (dollars in thousands) 2020 2019 2018 2017 2016 Prior Cost Basis Cost Basis Total Residential Lending Residential Mortgage FICO: 740 and greater $ 134,802 $ 429,854 $ 380,979 $ 437,915 $ 376,570 $ 1,044,890 $ — $ — $ 2,805,010 680 - 739 28,248 71,374 69,543 69,434 44,492 170,974 — — 454,065 620 - 679 3,527 13,645 11,235 13,074 11,621 57,611 — — 110,713 550 - 619 2,012 1,834 3,547 4,096 3,050 13,474 — — 28,013 Less than 550 — — 1,206 1,912 966 6,363 — — 10,447 No Score (3) 11,783 21,987 25,655 26,042 16,592 54,212 — — 156,271 Other (2) 4,783 20,938 26,627 25,451 12,528 17,524 580 505 108,936 Total Residential Mortgage 185,155 559,632 518,792 577,924 465,819 1,365,048 580 505 3,673,455 Home Equity Line FICO: 740 and greater — — — — — — 629,818 — 629,818 680 - 739 — — — — — — 173,990 — 173,990 620 - 679 — — — — — — 58,863 — 58,863 550 - 619 — — — — — — 16,863 — 16,863 Less than 550 — — — — — — 6,852 — 6,852 No Score (3) — — — — — — 5,312 — 5,312 Total Home Equity Line — — — — — — 891,698 — 891,698 Total Residential Lending 185,155 559,632 518,792 577,924 465,819 1,365,048 892,278 505 4,565,153 Consumer Lending FICO: 740 and greater 46,781 150,459 128,010 76,608 41,303 17,034 117,149 — 577,344 680 - 739 29,047 124,783 99,908 59,075 29,503 13,332 92,315 — 447,963 620 - 679 11,357 73,221 51,785 35,102 18,932 9,072 49,123 — 248,592 550 - 619 1,679 21,334 23,130 20,105 10,676 6,105 18,624 — 101,653 Less than 550 581 7,625 12,696 12,928 6,832 3,459 7,906 — 52,027 No Score (3) 2,796 6,248 174 151 30 3 37,382 — 46,784 Other (2) 600 9,173 104 2,230 100 6,823 74,680 — 93,710 Total Consumer Lending 92,841 392,843 315,807 206,199 107,376 55,828 397,179 — 1,568,073 Total Loans and Leases $ 520,211 $ 2,312,205 $ 1,969,068 $ 1,533,858 $ 1,036,924 $ 2,827,658 $ 3,116,593 $ 63,753 $ 13,380,270 (1) Other credit quality indicators used for monitoring purposes are primarily FICO scores. (2) Other credit quality indicators used for monitoring purposes are primarily internal risk ratings. (3) No FICO scores are primarily related to loans and leases extended to non-residents. Loans and leases of this nature are primarily secured by collateral and/or are closely monitored for performance. There were no loans and leases graded as Loss as of March 31, 2020. The amortized cost basis of revolving loans that were converted to term loans during the three months ended March 31, 2020 was as follows: Three Months Ended (dollars in thousands) March 31, 2020 Commercial and industrial $ 28,228 Residential mortgage 296 Total Revolving Loans Converted to Term Loans During the Period $ 28,524 The credit risk profiles by internally assigned grade for loans and leases as of December 31, 2019, presented in accordance with Topic 310, Receivables December 31, 2019 Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Total Grade: Pass $ 2,585,908 $ 3,327,659 $ 515,993 $ 201,461 $ 6,631,021 Special mention 91,365 106,331 127 1,022 198,845 Substandard 65,969 29,963 3,121 — 99,053 Total $ 2,743,242 $ 3,463,953 $ 519,241 $ 202,483 $ 6,928,919 There were no loans and leases graded as Loss as of December 31, 2019. The credit risk profiles based on payment activity for loans and leases that were not subject to loan grading as of December 31, 2019, presented in accordance with Topic 310, Receivables December 31, 2019 (dollars in thousands) Residential Mortgage Home Equity Line Consumer Consumer - Auto Credit Cards Total Performing $ 3,759,799 $ 886,879 $ 219,046 $ 1,016,142 $ 347,264 $ 6,229,130 Non-performing and delinquent 9,137 6,360 7,258 24,326 6,520 53,601 Total $ 3,768,936 $ 893,239 $ 226,304 $ 1,040,468 $ 353,784 $ 6,282,731 Past-Due Status The Company continually updates its aging analysis for loans and leases to monitor the migration of loans and leases into past due categories. The Company considers loans and leases that are delinquent for 30 days or more to be past due. As of March 31, 2020, the aging analysis of the amortized cost basis of the Company’s past due loans and leases was as follows: March 31, 2020 Past Due Loans and Greater Leases Past Than or Due 90 Days 30-59 60-89 Equal to or More and Days Days 90 Days Total Total Loans Still Accruing (dollars in thousands) Past Due Past Due Past Due Past Due Current and Leases Interest Commercial and industrial $ 6,634 $ 1,010 $ 4,041 $ 11,685 $ 3,013,660 $ 3,025,345 $ 4,007 Commercial real estate 14,204 2,706 757 17,667 3,395,347 3,413,014 757 Construction 6,003 104 2,570 8,677 563,385 572,062 148 Lease financing — — — — 236,623 236,623 — Residential mortgage 3,556 2,349 2,671 8,576 3,664,879 3,673,455 82 Home equity line 6,947 1,462 2,566 10,975 880,723 891,698 2,566 Consumer 33,077 6,223 3,353 42,653 1,525,420 1,568,073 3,353 Total $ 70,421 $ 13,854 $ 15,958 $ 100,233 $ 13,280,037 $ 13,380,270 $ 10,913 As of December 31, 2019, the aging analysis of the Company’s past due loans and leases, presented in accordance with Topic 310, Receivables December 31, 2019 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 $ 1,525 $ 808 $ 1,429 $ 3,762 $ 2,739,448 $ 2,743,210 $ 32 $ 2,743,242 Commercial real estate 1,664 1,125 1,013 3,802 3,460,121 3,463,923 30 3,463,953 Construction — — 2,367 2,367 516,874 519,241 — 519,241 Lease financing — — — — 202,483 202,483 — 202,483 Residential mortgage 3,258 399 74 3,731 3,759,799 3,763,530 5,406 3,768,936 Home equity line 2,971 394 2,995 6,360 886,879 893,239 — 893,239 Consumer 26,810 7,022 4,272 38,104 1,582,452 1,620,556 — 1,620,556 Total $ 36,228 $ 9,748 $ 12,150 $ 58,126 $ 13,148,056 $ 13,206,182 $ 5,468 $ 13,211,650 Nonaccrual Loans and Leases The Company generally places a loan or lease 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. The Company charges off a loan or lease when facts indicate that the loan or lease is considered uncollectible. The amortized cost basis of loans and leases on nonaccrual status as of March 31, 2020 and January 1, 2020 and the amortized cost basis of loans and leases on nonaccrual status with no allowance for credit losses as of March 31, 2020 were as follows: March 31, 2020 January 1, 2020 Nonaccrual Loans and Leases With No Nonaccrual Nonaccrual Allowance Loans Loans (dollars in thousands) for Credit Losses and Leases and Leases Commercial and industrial $ — $ 32 $ 32 Commercial real estate — — 30 Construction — 2,422 — Residential mortgage 806 4,472 5,406 Total Nonaccrual Loans and Leases $ 806 $ 6,926 $ 5,468 For the three months ended March 31, 2020, the Company recognized interest income of nil on nonaccrual loans and leases. Furthermore, for the three months ended March 31, 2020, the amount of accrued interest receivables written off by reversing interest income was not material. Collateral-Dependent Loans and Leases Collateral-dependent loans and leases are those for which repayment (on the basis of the Company’s assessment as of the reporting date) is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. As of March 31, 2020, the amortized cost basis of collateral-dependent loans was $35.1 million. These loans were primarily collateralized by residential real estate property and borrower assets. As of March 31, 2020, the fair value of collateral on substantially all collateral-dependent loans were significantly in excess of their amortized cost basis. Impaired Loans The total carrying amounts and the total unpaid principal balances of impaired loans and leases as of December 31, 2019, presented in accordance with Topic 310, Receivables December 31, 2019 Unpaid Recorded Principal Related (dollars in thousands) Investment Balance Allowance Impaired loans with no related allowance recorded: Commercial and industrial $ 3,825 $ 3,841 $ — Commercial real estate 30 30 — Residential mortgage 10,425 10,718 — Total $ 14,280 $ 14,589 $ — Impaired loans with a related allowance recorded: Commercial and industrial $ 1,126 $ 1,126 $ 46 Commercial real estate 693 693 27 Residential mortgage 4,539 4,819 130 Total $ 6,358 $ 6,638 $ 203 Total impaired loans: Commercial and industrial $ 4,951 $ 4,967 $ 46 Commercial real estate 723 723 27 Residential mortgage 14,964 15,537 130 Total $ 20,638 $ 21,227 $ 203 The following table provides information with respect to the Company’s average balances, and of interest income recognized from, impaired loans for the three months ended March 31, 2019, presented in accordance with Topic 310, Receivables Three Months Ended March 31, 2019 Average Interest Recorded Income (dollars in thousands) Investment Recognized Impaired loans with no related allowance recorded: Commercial and industrial $ 3,418 $ 29 Commercial real estate 4,102 171 Residential mortgage 8,666 100 Total $ 16,186 $ 300 Impaired loans with a related allowance recorded: Commercial and industrial $ 5,978 $ 108 Commercial real estate 723 10 Residential mortgage 7,156 96 Total $ 13,857 $ 214 Total impaired loans: Commercial and industrial $ 9,396 $ 137 Commercial real estate 4,825 181 Residential mortgage 15,822 196 Total $ 30,043 $ 514 Modifications Commercial and industrial loans modified in a TDR may involve temporary interest-only payments, term extensions, and converting revolving credit lines to term loans. 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 loan 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 ACL associated with the loan. An ACL 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 or if the loan is collateral dependent, the estimated fair value of the collateral, less any selling costs. An ACL for impaired residential real estate 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 months ended March 31, 2020 and 2019: Three Months Ended Three Months Ended March 31, 2020 March 31, 2019 Number of Recorded Related Number of Recorded Related (dollars in thousands) Contracts Investment (1) Allowance Contracts Investment (1) Allowance Commercial and industrial 1 $ 500 $ 30 4 $ 916 $ 24 Residential mortgage — — — 1 352 14 Total 1 $ 500 $ 30 5 $ 1,268 $ 38 (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 an extension of maturity dates, temporary interest-only payments, reduced payments, or below-market interest rates. The Company had commitments to extend credit, standby letters of credit, and commercial letters of credit totaling $5.9 billion and $6.1 billion as of March 31, 2020 and December 31, 2019. Of the $5.9 billion at March 31, 2020, there were commitments of $2.0 million related to borrowers who had loan terms modified in a TDR. Of the $6.1 billion at December 31, 2019, there were commitments of $4.5 million related to borrowers who had loan terms modified in a TDR. There were no loans modified in TDRs that have defaulted in the current period within 12 months of their permanent modification dates during both the three months ended March 31, 2020 and 2019. Foreclosure Proceedings As of both March 31, 2020 and December 31, 2019, there was one residential mortgage loan collateralized by real estate property of $0.3 million that was modified in a TDR that was in process of foreclosure. Foreclosed Property As of March 31, 2020, residential real estate property held from one foreclosed residential real estate loan was held and included in other real estate owned and repossessed personal property with a carrying value of $0.2 million on the consolidated balance sheet. As of December 31, 2019, residential real estate properties from two foreclosed residential real estate loans were held and included in other real estate owned and repossessed personal property with a carrying value of $0.3 million on the consolidated balance sheet. |
Mortgage Servicing Rights
Mortgage Servicing Rights | 3 Months Ended |
Mar. 31, 2020 | |
Mortgage Servicing Rights | |
Mortgage Servicing Rights | 5. Mortgage Servicing Rights Mortgage servicing activities include collecting principal, interest, tax, and insurance payments from borrowers while accounting for and remitting payments to investors, taxing authorities, and insurance companies. The Company also monitors delinquencies and administers foreclosure proceedings. Mortgage loan servicing income is recorded in noninterest income as a part of other service charges and fees and amortization of the servicing assets is recorded in noninterest income as part of other income. The unpaid principal amount of residential real estate loans serviced for others was $2.4 billion and $2.3 billion as of March 31, 2020 and December 31, 2019, respectively. Servicing fees include contractually specified fees, late charges, and ancillary fees, and were $1.5 million and $1.6 million for the three months ended March 31, 2020 and 2019, respectively. Amortization of mortgage servicing rights (“MSRs”) was $2.0 million and $0.8 million for the three months ended March 31, 2020 and 2019, respectively. The estimated future amortization expenses for MSRs over the next five years are as follows: Estimated (dollars in thousands) Amortization Under one year $ 2,535 One to two years 2,047 Two to three years 1,651 Three to four years 1,341 Four to five years 1,101 The details of the Company’s MSRs are presented below: March 31, December 31, (dollars in thousands) 2020 2019 Gross carrying amount $ 64,771 $ 63,480 Less: accumulated amortization 52,792 50,812 Net carrying value $ 11,979 $ 12,668 The following table presents changes in amortized MSRs for the three months ended March 31, 2020 and 2019: Three Months Ended March 31, (dollars in thousands) 2020 2019 Balance at beginning of period $ 12,668 $ 16,155 Originations 1,291 8 Amortization (1,980) (764) Balance at end of period $ 11,979 $ 15,399 Fair value of amortized MSRs at beginning of period $ 20,329 $ 27,662 Fair value of amortized MSRs at end of period $ 17,615 $ 26,383 MSRs are evaluated for impairment if events and circumstances indicate a possible impairment. No impairment of MSRs was recorded for the three months ended March 31, 2020 and 2019. The quantitative assumptions used in determining the lower of cost or fair value of the Company’s MSRs as of March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Weighted Weighted Range Average Range Average Conditional prepayment rate 14.17 % - 24.82 % 14.45 % 10.74 % - 23.39 % 11.10 % Life in years (of the MSR) 1.93 - 5.26 5.00 2.04 - 6.33 5.99 Weighted-average coupon rate 3.93 % - 7.22 % 3.99 % 3.96 % - 7.26 % 4.01 % Discount rate 10.00 % - 10.00 % 10.00 % 10.00 % - 10.01 % 10.00 % The sensitivities surrounding MSRs are expected to have an immaterial impact on fair value. |
Transfers of Financial Assets
Transfers of Financial Assets | 3 Months Ended |
Mar. 31, 2020 | |
Transfers of Financial Assets | |
Transfers of Financial Assets | 6. 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 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 March 31, 2020 and December 31, 2019 were as follows: (dollars in thousands) March 31, 2020 December 31, 2019 Public deposits $ 1,997,472 $ 1,543,492 Federal Home Loan Bank 3,008,321 2,928,581 Federal Reserve Bank 1,250,553 953,169 ACH transactions 152,967 155,360 Interest rate swaps 55,831 43,296 Total $ 6,465,144 $ 5,623,898 As the Company did not enter into reverse repurchase agreements or repurchase agreements, no collateral was accepted or pledged as of March 31, 2020 and December 31, 2019. In addition, no debt was extinguished by in-substance defeasance. |
Deposits
Deposits | 3 Months Ended |
Mar. 31, 2020 | |
Deposits | |
Deposits | 7. Deposits As of March 31, 2020 and December 31, 2019, deposits were categorized as interest-bearing or noninterest-bearing as follows: (dollars in thousands) March 31, 2020 December 31, 2019 U.S.: Interest-bearing $ 10,539,824 $ 9,782,957 Noninterest-bearing 5,073,463 5,188,696 Foreign: Interest-bearing 734,639 781,965 Noninterest-bearing 672,076 691,376 Total deposits $ 17,020,002 $ 16,444,994 The following table presents the maturity distribution of time certificates of deposit as of March 31, 2020: Under $250,000 (dollars in thousands) $250,000 or More Total Three months or less $ 248,179 $ 490,557 $ 738,736 Over three through six months 151,083 570,240 721,323 Over six through twelve months 385,105 551,485 936,590 One to two years 112,964 83,388 196,352 Two to three years 121,995 59,604 181,599 Three to four years 77,139 12,754 89,893 Four to five years 41,639 6,053 47,692 Thereafter 113 — 113 Total $ 1,138,217 $ 1,774,081 $ 2,912,298 Time certificates of deposit in denominations of $250,000 or more, in the aggregate, were $1.8 billion and $1.4 billion as of March 31, 2020 and December 31, 2019, respectively. Overdrawn deposit accounts are classified as loans and totaled $2.3 million and $3.6 million as of March 31, 2020 and December 31, 2019, respectively. |
Short-Term Borrowings
Short-Term Borrowings | 3 Months Ended |
Mar. 31, 2020 | |
Short-Term Borrowings | |
Short-Term Borrowings | 8. Short-Term Borrowings At March 31, 2020 and December 31, 2019, short-term borrowings were comprised of the following: (dollars in thousands) March 31, 2020 December 31, 2019 Short-term FHLB fixed-rate advances (1) $ 400,000 $ 400,000 Total short-term borrowings $ 400,000 $ 400,000 (1) Interest is payable monthly. As of both March 31, 2020 and December 31, 2019, the Company’s short-term borrowings included $400.0 million in short-term FHLB fixed-rate advances with a weighted average interest rate of 2.84% and maturity dates in 2020. As of March 31, 2020 and December 31, 2019, the available remaining borrowing capacity with the FHLB was $1.8 billion and $1.7 billion, respectively. The short-term FHLB fixed-rate advances require monthly interest-only payments with the principal amount due on the maturity date. See “Note 6. Transfers of Financial Assets” for more information. |
Long-Term Borrowings
Long-Term Borrowings | 3 Months Ended |
Mar. 31, 2020 | |
Long-Term Borrowings | |
Long-Term Borrowings | 9. Long-Term Borrowings Long-term borrowings consisted of the following as of March 31, 2020 and December 31, 2019: (dollars in thousands) March 31, 2020 December 31, 2019 Finance lease $ 19 $ 19 FHLB fixed-rate advances (1) 200,000 200,000 Total long-term borrowings $ 200,019 $ 200,019 (1) Interest is payable monthly. As of March 31, 2020 and December 31, 2019, the Company’s long-term borrowings included $200.0 million in FHLB fixed-rate advances with a weighted average interest rate of 2.73% and maturity dates ranging from 2023 to 2024. The FHLB fixed-rate advances require monthly interest-only payments with the principal amount due on the maturity date. The FHLB fixed-rate advances and remaining borrowing capacity were secured by residential real estate loan collateral as of March 31, 2020 and December 31, 2019. See “Note 6. Transfers of Financial Assets” for more information. As of March 31, 2020 and December 31, 2019, the Company’s long-term borrowings included a finance lease obligation with a 6.78% annual interest rate that matures in 2022. As of March 31, 2020, future contractual principal payments and maturities of long-term borrowings were as follows: Principal (dollars in thousands) Payments 2020 $ 9 2021 10 2022 — 2023 (1) 100,000 2024 (2) 100,000 Total $ 200,019 (1) FHLB fixed-rate advance callable on December 4, 2020 with an interest rate of 2.80% . (2) FHLB fixed-rate advance callable on January 15, 2021 with an interest rate of 2.65% . |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss). | |
Accumulated Other Comprehensive Income (Loss) | 10. Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive income (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 and net unrealized gains or losses on investment securities. Changes in accumulated other comprehensive income (loss) for the three months ended March 31, 2020 and 2019 are presented below: Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2019 $ (43,450) $ 11,701 $ (31,749) Three months ended March 31, 2020 Change in Company tax rate — (96) (96) Net change in pension and other benefits — (96) (96) Investment securities: Unrealized net gains arising during the period 49,164 (13,128) 36,036 Reclassification of net gains to net income: Investment securities gains, net (85) 23 (62) Net change in investment securities 49,079 (13,105) 35,974 Other comprehensive income 49,079 (13,201) 35,878 Accumulated other comprehensive income at March 31, 2020 $ 5,629 $ (1,500) $ 4,129 Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2018 $ (180,915) $ 48,720 $ (132,195) Three months ended March 31, 2019 Investment securities: Unrealized net gains arising during the period 70,523 (18,991) 51,532 Reclassification of net losses to net income: Investment securities losses, net 2,613 (704) 1,909 Net change in investment securities 73,136 (19,695) 53,441 Other comprehensive income 73,136 (19,695) 53,441 Accumulated other comprehensive loss at March 31, 2019 $ (107,779) $ 29,025 $ (78,754) The following table summarizes changes in accumulated other comprehensive income (loss), net of tax, for the periods indicated: Pensions Accumulated and Other Other Investment Comprehensive (dollars in thousands) Benefits Securities Income (Loss) Three Months Ended March 31, 2020 Balance at beginning of period $ (28,082) $ (3,667) $ (31,749) Other comprehensive income (96) 35,974 35,878 Balance at end of period $ (28,178) $ 32,307 $ 4,129 Three Months Ended March 31, 2019 Balance at beginning of period $ (28,379) $ (103,816) $ (132,195) Other comprehensive income — 53,441 53,441 Balance at end of period $ (28,379) $ (50,375) $ (78,754) |
Regulatory Capital Requirements
Regulatory Capital Requirements | 3 Months Ended |
Mar. 31, 2020 | |
Regulatory Capital Requirements | |
Regulatory Capital Requirements | 11. 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. The table below sets forth those ratios at March 31, 2020 and December 31, 2019: First Hawaiian Minimum Well- First Hawaiian, Inc. Bank Capital Capitalized (dollars in thousands) Amount Ratio Amount Ratio Ratio (1) Ratio (1) March 31, 2020: Common equity tier 1 capital to risk-weighted assets $ 1,665,064 11.65 % $ 1,645,403 11.51 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,665,064 11.65 % 1,645,403 11.51 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,843,775 12.90 % 1,824,118 12.76 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,665,064 8.63 % 1,645,403 8.52 % 4.00 % 5.00 % December 31, 2019: Common equity tier 1 capital to risk-weighted assets $ 1,676,515 11.88 % $ 1,654,304 11.72 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,676,515 11.88 % 1,654,304 11.72 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,807,645 12.81 % 1,785,434 12.65 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,676,515 8.79 % 1,654,304 8.67 % 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 capital conservation buffer requires a 2.5% capital conservation buffer designed to absorb losses during periods of economic stress. The capital conservation buffer is composed entirely of CET1, on top of these minimum risk weighted asset ratios, effectively resulting in minimum ratios of (i) 7% CET1to risk-weighted assets, (ii) 8.5% Tier 1 capital to risk-weighted assets, and (iii) 10.5% total capital to risk-weighted assets. As of March 31, 2020, 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 March 31, 2020, to change the capital adequacy category of the Company or the Bank. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | 12. 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 interim consolidated balance sheets as either assets or liabilities at fair value. Derivatives entered into for customer accommodation purposes consist of 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 March 31, 2020 and December 31, 2019: March 31, 2020 December 31, 2019 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 $ 23,190 $ — $ (1,635) $ 23,190 $ — $ (682) Derivatives not designated as hedging instruments: Interest rate swaps 2,901,085 158,711 — 2,818,803 63,527 — Funding swap 85,645 — (3,199) 82,900 — (4,233) Foreign exchange contracts 1,834 — (52) 1,428 12 — (1) The positive fair values of derivative assets are included in other assets. (2) The negative fair values of derivative liabilities are included in other liabilities. Certain interest rate swaps noted above, are cleared through clearinghouses, rather than directly with counterparties. Those transactions cleared through a clearinghouse require initial margin collateral and variation margin payments depending on the contracts being in a net asset or liability position. The amount of initial margin cash collateral posted by the Company was $12.7 million and $8.7 million as of March 31, 2020 and December 31, 2019, respectively. As of March 31, 2020 and December 31, 2019, the variation margin was $158.7 million and $63.5 million, respectively. As of March 31, 2020, the Company pledged $30.9 million in financial instruments and $24.9 million in cash as collateral for interest rate swaps. As of December 31, 2019, the Company pledged $29.9 million in financial instruments and $13.4 million in cash as collateral for interest rate swaps. As of March 31, 2020 and December 31, 2019, the cash collateral includes the excess initial margin for interest rate swaps cleared through clearinghouses and cash collateral for interest rate swaps with financial institution counterparties. 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 March 31, 2020, the Company carried one interest rate swap with a notional amount of $23.2 million with a negative fair value of $1.6 million that was categorized as a fair value hedge for a commercial and industrial loan. The Company received a USD Prime floating rate and paid a fixed rate of 2.90% . The swap matures in 2023. At December 31, 2019, the Company carried one interest rate swap with a notional amount of $23.2 million with a negative fair value of $0.7 million that was categorized as a fair value hedge for a commercial and industrial loan. The following table shows the gains and losses recognized in income related to derivatives in fair value hedging relationships for the three months ended March 31, 2020 and 2019: Gains (losses) recognized in the consolidated statements March 31, (dollars in of income line item 2020 2019 Gains (losses) on fair value hedging relationships recognized in interest income: Recognized on interest rate swap Loans and lease financing $ (955) $ (342) Recognized on hedged item Loans and lease financing 906 262 As of March 31, 2020 and December 31, 2019, the following amounts were recorded in the unaudited interim consolidated balance sheets related to the cumulative basis adjustments for fair value hedges: Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Asset Carrying Amount of the Hedged Asset (dollars in March 31, 2020 December 31, 2019 March 31, 2020 December 31, 2019 Line item in the consolidated balance sheets in which the hedged item is included Loans and leases $ 25,146 $ 24,415 $ 1,923 $ 1,017 Free-Standing Derivative Instruments 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 interim consolidated statements of income for the three months ended March 31, 2020 and 2019: Net gains (losses) recognized in the consolidated statements March 31, (dollars in of income line item 2020 2019 Derivatives Not Designated As Hedging Instruments: Interest rate swaps Other noninterest income $ — $ 16 Funding swap Other noninterest income 6 5 Foreign exchange contracts Other noninterest income (52) — As of March 31, 2020, the Company carried multiple interest rate swaps with notional amounts totaling $2.9 billion, all of which were related to the Company’s customer swap program, with a positive fair value of $158.7 million and a negative fair value of nil. The Company received floating rates ranging from 0.99% to 7.83% and paid fixed rates ranging from 2.02% to 8.73%. The swaps mature between June 2021 and March 2040. As of December 31, 2019, the Company carried multiple interest rate swaps with notional amounts totaling $2.8 billion, all of which were related to the Company’s customer swap program, with a positive fair value of $63.5 million and a negative fair value of nil. The Company received 1-month LIBOR and paid fixed rates ranging from 1.71% to 8.73%. These swaps resulted in net interest expense of nil for both the three months ended March 31, 2020 and 2019. 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 $1.9 million and $0.8 million for the three months ended March 31, 2020 and 2019, 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 rate to unrestricted Class A common shares. On June 28, 2018, Visa additionally funded its litigation escrow account, thereby reducing each member bank’s Class B conversion rate to unrestricted Class A common shares. Accordingly, on July 5, 2018, Visa announced a decrease in conversion rate from 1.6483 to 1.6298 effective June 28, 2018. In July 2018, the Company made a payment of approximately $0.7 million to the buyer as a result of the reduction in the Visa Class B conversion rate. On September 27, 2019, Visa additionally funded its litigation escrow account, thereby further reducing each member bank’s Class B conversion rate to unrestricted Class A common shares. Accordingly, on September 30, 2019, Visa announced a decrease in conversion rate from 1.6298 to 1.6228 effective September 27, 2019. In October 2019, the Company made a payment of approximately $0.3 million liability to the buyer as a result of the reduction in the Visa Class B conversion rate. 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. A derivative liability (“Visa derivative”) of $3.2 million and $4.2 million was included in the unaudited interim consolidated balance sheets at March 31, 2020 and December 31, 2019, respectively, to provide for the fair value of this liability. There were no sales of these shares prior to 2016. See “Note 17. 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 asset less loan balance, requires valuation of the pledged asset. Counterparty credit risk adjustments of $0.1 million were recognized during both the three months ended March 31, 2020 and 2019. Credit-Risk Related Contingent Features Certain of our derivative contracts contain provisions whereby if the Company’s credit rating were to be downgraded by certain major credit rating agencies as a result of a merger or material adverse change in the Company’s financial condition, the counterparty could require an early termination of derivative instruments in a net liability position. The aggregate fair value of all derivative instruments with such credit-risk related contingent features that are in a net liability position was $12.3 million and $4.0 million at March 31, 2020 and December 31, 2019, respectively, for which we posted $12.2 million and $4.7 million, respectively, in collateral in the normal course of business. If the Company’s credit rating had been downgraded as of March 31, 2020 and December 31, 2019, we may have been required to settle the contracts in an amount equal to their fair value. |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingent Liabilities | |
Commitments and Contingent Liabilities | 13. Commitments and Contingent Liabilities Contingencies Various 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 unaudited interim 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 interim consolidated financial statements. Unfunded Commitments to Extend Credit Standby and Commercial Letters of Credit for which collateral is deemed necessary. The commitments outstanding as of March 31, 2020 have maturities ranging from April 2020 to May 2022. 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 March 31, 2020 and December 31, 2019 were as follows: March 31, December 31, (dollars in 2020 2019 Financial instruments whose contract amounts represent credit risk: Commitments to extend credit $ 5,727,850 $ 5,907,690 Standby letters of credit 185,315 181,412 Commercial letters of credit 8,850 7,334 Guarantees The Company sells residential mortgage loans in the secondary market primarily to The Federal National Mortgage Association (“Fannie Mae”) and The Federal Home Loan Mortgage Corporation (“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 12. Derivative Financial Instruments” for more information. Reorganization Transactions On April 1, 2016, a series of reorganization transactions were undertaken to facilitate FHI’s initial public offering. In connection with the reorganization transactions, FHI distributed its interest in BancWest Holding Inc. (“BWHI”), including Bank of the West (“BOW”) to BNP Paribas (“BNPP”) so that BWHI was held directly by BNPP. 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 Corporation, 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. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contracts with Customers | |
Revenue from Contracts with Customers | 14. Revenue from Contracts with Customers Revenue Recognition In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services that are promised within each contract and identifies those that contain performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Disaggregation of Revenue In 2019, the Company made changes to the internal measurement of segment operating profits for the purpose of evaluating segment performance and resource allocation. The Company has restated the selected financial information for the three months ended March 31, 2019 in order to conform with the current presentation. See “Note 18. Reportable Operating Segments” in the notes to the unaudited interim consolidated financial statements. The following table summarizes the Company’s revenues, which includes net interest income on financial instruments and noninterest income, disaggregated by type of service and business segments for the periods indicated: Three Months Ended March 31, 2020 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Net interest income (1) $ 89,883 $ 34,414 $ 14,386 $ 138,683 Service charges on deposit accounts 8,088 351 511 8,950 Credit and debit card fees — 12,887 1,599 14,486 Other service charges and fees 4,875 424 516 5,815 Trust and investment services income 9,591 — — 9,591 Other 185 1,106 188 1,479 Not in scope of Topic 606 (1) 3,637 3,028 2,242 8,907 Total noninterest income 26,376 17,796 5,056 49,228 Total revenue $ 116,259 $ 52,210 $ 19,442 $ 187,911 (1) Most of the Company’s revenue is not within the scope of ASU No. 2014-09, Revenue from Contracts with Customers. The guidance explicitly excludes net interest income from financial assets and liabilities as well as other noninterest income from loans, leases, investment securities and derivative financial instruments. Three Months Ended March 31, 2019 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Net interest income (1) $ 107,227 $ 34,656 $ 3,206 $ 145,089 Service charges on deposit accounts 7,234 310 516 8,060 Credit and debit card fees — 19,707 1,727 21,434 Other service charges and fees 5,333 369 542 6,244 Trust and investment services income 8,618 — — 8,618 Other 215 1,509 208 1,932 Not in scope of Topic 606 (1) 2,469 (3,507) 1,822 784 Total noninterest income 23,869 18,388 4,815 47,072 Total revenue $ 131,096 $ 53,044 $ 8,021 $ 192,161 (1) Most of the Company’s revenue is not within the scope of ASU No. 2014-09, Revenue from Contracts with Customers. The guidance explicitly excludes net interest income from financial assets and liabilities as well as other noninterest income from loans, leases, investment securities and derivative financial instruments. For the three months ended March 31, 2020 and 2019, substantially all of the Company’s revenues under the scope of Topic 606 were related to performance obligations satisfied at a point in time. The following is a discussion of revenues within the scope of Topic 606. Service Charges on Deposit Accounts Service charges on deposit accounts relate to fees generated from a variety of deposit products and services rendered to customers. Charges include, but are not limited to, overdraft fees, non-sufficient fund fees, dormant fees and monthly service charges. Such fees are recognized concurrent with the event on a daily basis or on a monthly basis depending upon the customer’s cycle date. Credit and Debit Card Fees Credit and debit card fees primarily represent revenues earned from interchange fees, ATM fees and merchant processing fees. Interchange and network revenues are earned on credit and debit card transactions conducted with payment networks. ATM fees are primarily earned as a result of surcharges assessed to non-FHB customers who use an FHB ATM. Merchant processing fees are primarily earned on transactions in which FHB is the acquiring bank. Such fees are generally recognized concurrently with the delivery of services on a daily basis. Trust and Investment Services Fees Trust and investment services fees represent revenue earned by directing, holding and managing customers’ assets. Fees are generally computed based on a percentage of the previous period’s value of assets under management. The transaction price (i.e., percentage of assets under management) is established at the inception of each contract. Trust and investment services fees also include fees collected when the Company acts as agent or personal representative and executes security transactions, performs collection and disbursement of income, and completes investment management and other administrative tasks. Other Fees Other fees primarily include revenues generated from wire transfers, lockboxes, bank issuance of checks and insurance commissions. Such fees are recognized concurrent with the event or on a monthly basis. Contract Balances A contract liability is an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer. In prior years, the Company received signing bonuses from two vendors which are being amortized over the term of the respective contracts. As of March 31, 2020 and December 31, 2019, the Company had contract liabilities of $1.6 million and $1.8 million, respectively, which will be recognized over the remaining term of the respective contracts with the vendors. For both the three months ended March 31, 2020 and 2019, the Company’s recognized revenues and contract liabilities decreased by approximately $0.2 million, due to the passage of time. There were no changes in contract liabilities due to changes in transaction price estimates. A contract asset is the right to consideration for transferred goods or services when the amount is conditioned on something other than the passage of time. As of March 31, 2020 and December 31, 2019, there were no receivables from contracts with customers or contract assets recorded on the Company’s consolidated balance sheets. Other Except for the contract liabilities noted above, the Company did not have any significant performance obligations as of March 31, 2020 and December 31, 2019. The Company also did not have any material contract acquisition costs or use any significant judgments or estimates in recognizing revenue for financial reporting purposes. |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings per Share | |
Earnings per Share | 15. Earnings per Share For the three months ended March 31, 2020 and 2019, 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 months ended March 31, 2020 and 2019, the computations of basic and diluted earnings per share were as follows: Three Months Ended March 31, (dollars in 2020 2019 Numerator: Net income $ 38,865 $ 69,924 Denominator: Basic: weighted-average shares outstanding 129,895,706 134,879,336 Add: weighted-average equity-based awards 455,879 319,009 Diluted: weighted-average shares outstanding 130,351,585 135,198,345 Basic earnings per share $ 0.30 $ 0.52 Diluted earnings per share $ 0.30 $ 0.52 |
Noninterest Income and Noninter
Noninterest Income and Noninterest Expense | 3 Months Ended |
Mar. 31, 2020 | |
Noninterest Income and Noninterest Expense | |
Noninterest Income and Noninterest Expense | 16. Noninterest Income and Noninterest Expense Benefit Plans The Company sponsors an unfunded supplemental executive retirement plan (“SERP”) for certain key executives. In March 2019, the Company’s board of directors approved an amendment to the SERP to freeze the SERP, which became effective on July 1, 2019. As a result of the amendment, since the effective date, there have not been any, and there will be no, new accruals of benefits, including service accruals. Existing benefits under the SERP, as of the effective date of the amendment described above, will otherwise continue in accordance with the terms of the SERP. The following table sets forth the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans for the three months ended March 31, 2020 and 2019: Income line item where recognized in Pension Benefits Other Benefits (dollars in the consolidated statements of income 2020 2019 2020 2019 Three Months Ended March 31, Service cost Salaries and employee benefits $ — $ 17 $ 189 $ 159 Interest cost Other noninterest expense 1,621 2,044 164 206 Expected return on plan assets Other noninterest expense (1,194) (1,195) — — Prior service credit Other noninterest expense — — (13) (107) Recognized net actuarial loss (gain) Other noninterest expense 1,429 1,564 (26) (76) Total net periodic benefit cost $ 1,856 $ 2,430 $ 314 $ 182 Leases The Company recognized operating lease income related to lease payments of $1.5 million for both the three months ended March 31, 2020 and 2019. In addition, the Company recognized $1.5 million and $1.1 million of lease income related to variable lease payments for the three months ended March 31, 2020 and 2019, respectively. |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value | |
Fair Value | 17. Fair Value The Company determines the fair values of its financial instruments based on the requirements established in Accounting Standards Codification Topic 820 (“Topic 820”), Fair Value Measurements Fair Value Hierarchy Topic 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 unobservable inputs to 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. Topic 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, 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, deposit liabilities with no defined or contractual maturity, 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 March 31, 2020 and December 31, 2019, 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. 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. 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 rate to unrestricted Class A common shares. On July 5, 2018, Visa announced a decrease in conversion rate from 1.6483 to 1.6298 effective June 28, 2018. On September 27, 2019, Visa additionally funded its litigation escrow account, thereby further reducing each member bank’s Class B conversion rate to unrestricted Class A common shares. Accordingly, on September 30, 2019, Visa announced a decrease in conversion rate from 1.6298 to 1.6228 effective September 27, 2019. The Visa derivative of $3.2 million and $4.2 million was included in the unaudited interim consolidated balance sheets at March 31, 2020 and December 31, 2019, 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 rate, 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 March 31, 2020 and December 31, 2019 are summarized below: Fair Value Measurements as of March 31, 2020 Quoted Prices in Significant Active Markets for Other Significant Identical Assets Observable Unobservable (dollars in (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets U.S. Treasury securities $ — $ 30,927 $ — $ 30,927 Government-sponsored enterprises debt securities — 26,721 — 26,721 Mortgage-backed securities: Residential - Government agency (1) — 278,963 — 278,963 Residential - Government-sponsored enterprises (1) — 417,667 — 417,667 Commercial - Government-sponsored enterprises — 186,784 — 186,784 Collateralized mortgage obligations: Government agency — 2,320,878 — 2,320,878 Government-sponsored enterprises — 796,517 — 796,517 Total available-for-sale securities — 4,058,457 — 4,058,457 Other assets (2) — 158,711 — 158,711 Liabilities Other liabilities (3) — (1,687) (3,199) (4,886) Total $ — $ 4,215,481 $ (3,199) $ 4,212,282 (1) Backed by residential real estate. (2) Other assets include derivative assets. (3) Other liabilities include derivative liabilities. Fair Value Measurements as of December 31, 2019 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 $ — $ 29,888 $ — $ 29,888 Government-sponsored enterprises debt securities — 101,439 — 101,439 Mortgage-backed securities: Residential - Government agency (1) — 291,209 — 291,209 Residential - Government-sponsored enterprises (1) — 399,492 — 399,492 Commercial - Government-sponsored enterprises — 101,719 — 101,719 Collateralized mortgage obligations: Government agency — 2,381,278 — 2,381,278 Government-sponsored enterprises — 770,619 — 770,619 Total available-for-sale securities — 4,075,644 — 4,075,644 Other assets (2) — 63,539 — 63,539 Liabilities Other liabilities (3) — (682) (4,233) (4,915) Total $ — $ 4,138,501 $ (4,233) $ 4,134,268 (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 months ended March 31, 2020, 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 months ended March 31, 2020 and 2019 are summarized below. Visa Derivative (dollars in 2020 2019 Three Months Ended March 31, Balance as of January 1, $ (4,233) $ (2,607) Total net gains included in other noninterest income 6 5 Settlements 1,028 763 Balance as of March 31, $ (3,199) $ (1,839) Total net gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of March 31, $ 6 $ 5 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 deposit liabilities with no defined or contractual maturity. March 31, 2020 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: Cash and cash equivalents $ 1,052,832 $ 353,908 $ 698,924 $ — $ 1,052,832 Loans held for sale 8,180 — 8,180 — 8,180 Loans (1) 13,143,647 — — 13,452,051 13,452,051 Financial liabilities: Time deposits (2) $ 2,912,298 $ — $ 2,922,389 $ — $ 2,922,389 Short-term borrowings 400,000 — 401,418 — 401,418 Long-term borrowings (3) 200,000 — 215,788 — 215,788 December 31, 2019 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: Cash and cash equivalents $ 694,017 $ 360,375 $ 333,642 $ — $ 694,017 Loans held for sale 904 — 904 — 904 Loans (1) 13,009,167 — — 13,140,898 13,140,898 Financial liabilities: Time deposits (2) $ 2,510,157 $ — $ 2,501,478 $ — $ 2,501,478 Short-term borrowings 400,000 — 401,709 — 401,709 Long-term borrowings (3) 200,000 — 207,104 — 207,104 (1) Excludes financing leases of $236.6 million at March 31, 2020 and $202.5 million at December 31, 2019. (2) Excludes deposit liabilities with no defined or contractual maturity of $14.1 billion as of March 31, 2020 and $13.9 billion as of December 31, 2019. (3) Excludes capital lease obligations of $19 thousand as of both March 31, 2020 and December 31, 2019. Unfunded loan and lease commitments and letters of credit are not included in the tables above. As of March 31, 2020 and December 31, 2019, the Company had $5.9 billion and $6.1 billion, respectively, of unfunded loan and lease commitments and letters of credit. A reasonable estimate of the fair value of these instruments is the carrying value of deferred fees plus the related reserve for unfunded commitments, which totaled $30.8 million and $14.4 million at March 31, 2020 and December 31, 2019, respectively. No active trading market exists for these instruments, and the estimated fair value does not include value associated with the borrower relationship. The Company does not estimate the fair values of certain unfunded loan and lease commitments that can be canceled by providing notice to the borrower. As Company-level data is incorporated into the fair value measurement, unfunded loan and lease commitments and letters of credit are classified as Level 3. 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 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. Collateral-dependent loans Collateral-dependent loans are those for which repayment is expected to be provided substantially through the operation or sale of the collateral. 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 March 31, 2020 and December 31, 2019: (dollars Level 1 Level 2 Level 3 March 31, 2020 Collateral-dependent loans $ — $ — $ 1,840 December 31, 2019 Collateral-dependent loans $ — $ — $ 1,502 Total losses on collateral-dependent loans were $0.4 million for the three months ended March 31, 2020. No losses were recognized on collateral-dependent loans for the three months ended March 31, 2019. For Level 3 assets and liabilities measured at fair value on a recurring or nonrecurring basis as of March 31, 2020 and December 31, 2019, the significant unobservable inputs used in the fair value measurements were as follows: Quantitative Information about Level 3 Fair Value Measurements at March 31, 2020 Significant (dollars in thousands) Fair value Valuation Technique Unobservable Input Range Collateral-dependent loans $ 1,840 Appraisal Value Appraisal Value n/m (1) Visa derivative $ (3,199) Discounted Cash Flow Expected Conversation Rate - 1.6228 (2) 1.5977 -1.6228 Expected Term - 1 year (3) 0.5 to 1.5 years Growth Rate - 13% (4) 4% - 17% (1) The fair value of these assets is determined based on appraised values of the collateral or broker opinions, the range of which is not meaningful to disclose. (2) Due to the uncertainty in the movement of the conversion rate, the current conversion rate was utilized in the fair value calculation. (3) The expected term of 1 year was based on the median of 0.5 to 1.5 years. (4) The growth rate of 13% was based on the arithmetic average of analyst price targets. Quantitative Information about Level 3 Fair Value Measurements at December 31, 2019 Significant (dollars in thousands) Fair value Valuation Technique Unobservable Input Collateral-dependent loans $ 1,502 Appraisal Value Appraisal Value Visa derivative $ (4,233) Discounted Cash Flow Expected Conversion Rate - 1.6228 Expected Term - 1 year Growth Rate - 13% |
Reportable Operating Segments
Reportable Operating Segments | 3 Months Ended |
Mar. 31, 2020 | |
Reportable Operating Segments | |
Reportable Operating Segments | 18. 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 credit 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 credit losses from the Treasury and Other business segment (which is comprised of many of the Company’s support units) to the Retail and Commercial business segments. These allocations are based on direct costs incurred by the Retail and Commercial business segments. 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. In 2019, the Company made changes to the internal measurement of segment operating profits for the purpose of evaluating segment performance and resource allocation. The primary reason for the change was to align deposit balances within the business segment that directly manages them. Specifically, certain deposit balances previously included as part of the Retail Banking segment have been reclassified to the Commercial Banking segment. The reallocation of select deposit balances affected net interest income, net interest income after provision for credit losses, noninterest income, provision for income taxes and net income. The Company has reported its selected financial information using the new deposit balance alignments for the three months ended March 31, 2020. The Company has restated the selected financial information for the three months ended March 31, 2019 in order to conform with the current presentation. Additionally, during the fourth quarter of 2019, the Company changed its assumptions embedded in allocating deposit costs to business segments. The Company has reported its selected financial information using the new deposit cost assumptions starting with the fourth quarter of 2019. 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 58 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, automobile loans and auto dealer financing, business 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 March 31, 2020 Net interest income $ 89,883 $ 34,414 $ 14,386 $ 138,683 Provision for credit losses (20,065) (20,784) (351) (41,200) Net interest income after provision for credit losses 69,818 13,630 14,035 97,483 Noninterest income 26,376 17,796 5,056 49,228 Noninterest expense (61,644) (21,505) (13,317) (96,466) Income before provision for income taxes 34,550 9,921 5,774 50,245 Provision for income taxes (7,523) (2,645) (1,212) (11,380) Net income $ 27,027 $ 7,276 $ 4,562 $ 38,865 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended March 31, 2019 Net interest income $ 107,227 $ 34,656 $ 3,206 $ 145,089 Provision for credit losses (2,572) (3,108) — (5,680) Net interest income after provision for credit losses 104,655 31,548 3,206 139,409 Noninterest income 23,869 18,388 4,815 47,072 Noninterest expense (57,167) (19,485) (15,971) (92,623) Income (loss) before (provision) benefit for income taxes 71,357 30,451 (7,950) 93,858 (Provision) benefit for income taxes (18,047) (7,921) 2,034 (23,934) Net income (loss) $ 53,310 $ 22,530 $ (5,916) $ 69,924 |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization and Basis of Presentation | |
Organization and Basis of Presentation | First Hawaiian, Inc. (“FHI” or the “Parent”), 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. FHB offers a comprehensive suite of banking services to consumer and commercial customers including loans, deposit products, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. The accompanying unaudited interim 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 interim 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, 2019. 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 | 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. |
Investment Securities | Investment Securities As of March 31, 2020 and December 31, 2019, investment securities were comprised of debt, mortgage-backed securities and collateralized mortgage obligations issued by the U.S. Government, its agencies and government-sponsored enterprises. The Company amortizes premiums and accretes discounts using the interest method over the expected lives of the individual securities. Premiums on callable debt securities are amortized to their earliest call date. All investment securities transactions are recorded on a trade-date basis. All of the Company’s investment securities were categorized as available-for-sale as of March 31, 2020 and December 31, 2019. Available-for-sale investment securities are reported at fair value, with unrealized gains and losses reported in accumulated other comprehensive income. Gains and losses realized on sales of investment securities are determined using the specific identification method. For available-for-sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For available-for-sale debt securities that do not meet the aforementioned criteria, the Company evaluates at the individual security level whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. Changes in the allowance for credit losses, if any, are recorded as a provision for (or reversal of) credit losses. Losses are charged against the allowance when management believes the uncollectibility of an available-for-sale investment security is confirmed or when either of the criteria regarding intent or requirement to sell is met. As noted above, as of March 31, 2020, the Company’s available-for-sale investment securities were comprised entirely of debt, mortgage-backed securities and collateralized mortgage obligations issued by the U.S. Government, its agencies and government-sponsored enterprises. Management has concluded that the long history with no credit losses from these issuers indicates an expectation that nonpayment of the amortized cost basis is zero. The Company’s available-for-sale investment securities are explicitly or implicitly fully guaranteed by the U.S. government. The U.S. government can print its own currency and its currency is routinely held by central banks and other major financial institutions. The dollar is used in international commerce, and commonly is viewed as a reserve currency, all of which qualitatively indicates that historical credit loss information should be minimally affected by current conditions and reasonable and supportable forecasts. Thus, the Company has not Accrued interest receivable related to available-for-sale investment securities was $8.5 million as of March 31, 2020 and is recorded separately from the amortized cost basis of investment securities on the Company’s interim consolidated balance sheet. |
Loans and Leases | Loans and Leases Loans are reported at amortized cost which includes the principal amount outstanding, net of deferred loan fees and costs and cumulative net charge-offs. Interest income is recognized on an accrual basis. Loan origination fees, certain direct costs and unearned discounts and premiums, if any, are deferred and are generally accreted or amortized into interest income as yield adjustments using the interest method over the contractual life of the loan. Other credit-related fees are recognized as fee income, a component of noninterest income, when earned. Direct financing leases are carried at the aggregate of lease payments receivable plus the estimated residual value of leased property, less unearned income. Unearned income on direct financing leases is amortized over the lease term by methods that approximate the interest method. Residual values on leased assets are periodically reviewed for impairment. Accrued interest receivable related to loans and leases was $35.1 million as of March 31, 2020 and is recorded separately from the amortized cost basis of loans and leases on the Company’s interim consolidated balance sheet. |
Nonaccrual Loans and Leases | Nonaccrual Loans and Leases The Company generally places a loan or lease 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. A full or partial charge-off is recorded in the period in which the loan or lease is deemed uncollectible. When the Company places a loan or lease on nonaccrual status, previously accrued and uncollected interest is concurrently reversed against interest income. When the Company receives an interest payment on a nonaccrual loan or lease, the payment is applied as a reduction of the principal balance. Nonaccrual loans and leases are generally returned to accrual status when they become current as to principal and interest and future payments are reasonably assured. |
Allowance for Credit Losses | Allowance for Credit Losses The allowance for credit losses for loans and leases (the “ACL”) is a valuation account that is deducted from the amortized cost basis of loans and leases to present the net amount expected to be collected from loans and leases. Loans and leases are charged-off against the ACL when management believes the uncollectibility of a loan or lease balance is confirmed. Expected recoveries do not exceed the aggregate of amounts previously charged-off and expected to be charged-off. The Company’s ACL and the reserve for unfunded commitments under the Current Expected Credit Losses (“CECL”) approach utilizes both quantitative and qualitative components. The Company’s methodology utilizes a quantitative model based on a single forward-looking macroeconomic forecast. The quantitative estimation is overlaid with qualitative adjustments to account for current conditions and forward-looking events not captured in the quantitative model. Qualitative adjustments that are considered include adjustments for regulatory determinants, model limitations, model maturity, and other current or forecasted events that are not captured in the Company’s historical loss experience. The Company generally evaluates loans and leases on a collective or pool basis when similar risk characteristics exist. However, loans and leases that do not share similar risk characteristics are evaluated on an individual basis. Such loans and leases evaluated individually are excluded from the collective evaluation. Individually assessed loans are measured for estimated credit loss (“ECL”) based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral, less estimated selling costs, if the loan is collateral-dependent. Management reviews relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts about the future. Historical credit loss experience provides the basis for the estimation of expected credit losses. Adjustments to historical loss information are made for differences in current loan-specific risk characteristics such as differences in underwriting standards, portfolio mix, delinquency levels, or term as well as for changes in environmental conditions, such as changes in unemployment rates, property values, or other relevant factors. The Company utilizes a Probability of Default (“PD”)/Loss Given Default (“LGD”) framework to estimate the ACL and the reserve for unfunded commitments. The PD represents the percentage expectation to default, measured by assessing loans and leases that migrate to default status (i.e., nonaccrual status, troubled debt restructurings (“TDRs”), 90 days or more past due, partial or full charge-offs or bankruptcy). LGD is defined as the percentage of the exposure at default (“EAD”) lost at the time of default, net of any recoveries, and will be unique to each of the collateral types securing the Company’s loans. PD and LGD’s are based on past experience of the Company and management’s expectations of the future. The ECL on loans and leases is calculated by taking the product of the credit exposure, lifetime default probability (“LDP”) and the LGD. The ECL model is applied to current credit exposures at the account level, using assumptions calibrated at the portfolio segment level using internal historical loan and lease level data. The Company estimates the default risk of a credit exposure over the remaining life of each account using a transition probability matrix approach which captures both the average rate of up/down-grade and default transitions, as well as withdrawal rates which capture the historical rate of exposure decline due to loan and lease amortization and prepayment. To apply the transition matrices, each credit exposure’s remaining life is split into two time segments. The first time segment is for the reasonable and supportable forecast period over which the transition matrices which are applied have been adjusted to incorporate current and forecasted conditions over that period. Management has determined that using a one year time horizon for the reasonable and supportable forecast period for all classes of loans and leases is a reasonable forecast horizon given the difficulty in predicting future economic conditions with a high degree of certainty. The second time segment is the reversion period from the end of the reasonable and supportable forecast period to the maturity of the exposure, over which long-run average transition matrices are applied. Management elected to use an immediate reversion to the mean approach. Lifetime loss rates are applied against the amortized cost basis of loans and leases and unfunded commitments to estimate the ACL and the reserve for unfunded commitments. On a quarterly basis, management convenes the Bank’s forecasting team which is responsible for qualitatively forecasting the economic outlook over the reasonable and supportable forecast period within the context of forecasting credit losses. Management reviews local and national economic forecasts and other pertinent materials to inform the team in establishing their best estimate of the economic outlook over the reasonable and supportable forecast period. The team considers unemployment rates, gross domestic product, personal income per capita, visitor arrivals and expenditures and home prices along with other relevant information. The results from the Bank’s forecasting team dictates the direction of the economic forecast compared to current economic conditions (i.e., better or worse) and the magnitude of the forecast adjustment (e.g., mild, medium or severe). The direction of the economic forecast and magnitude are used to qualitatively adjust the modifier that is applied to the long-run default rates over the reasonable and supportable forecast period. The Company has identified three portfolio segments in estimating the ACL: commercial, residential real estate and consumer lending. The Company’s commercial portfolio segment is comprised of four distinct classes: commercial and industrial loans, commercial real estate loans, construction loans and lease financing. The key risk drivers related to this portfolio segment include risk rating, collateral type, and remaining maturity. The Company’s residential real estate portfolio segment is comprised of two distinct classes: residential real estate loans and home equity lines of credit. Specific risk characteristics related to this portfolio include the value of the underlying collateral, credit score and remaining maturity. Finally, the Company’s consumer portfolio segment is not further segmented, but consists primarily of automobile loans, credit cards and other installment loans. Automobile loans constitute the majority of this segment and are monitored using credit scores, collateral values and remaining maturity. The remainder of the consumer portfolio is predominantly unsecured. |
Reserve for Unfunded Commitments | Reserve for Unfunded Commitments The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Company. The reserve for unfunded commitments is adjusted through the provision for credit losses. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. |
Accounting Standard Adopted in 2020 and Recent Accounting Pronouncements | Accounting Standards Adopted in 2020 In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments The implementation of CECL required significant operational changes, particularly in data collection and analysis. The Company formed a working group comprised of teams from different disciplines, including credit, finance and information technology, to evaluate the requirements of the new standard and the impact it will have on the Company’s existing processes. The Company also engaged a software vendor and had run several CECL parallel run productions during 2019. The Company adopted the provisions of ASU No. 2016-13 and related amendments by recording a cumulative effect adjustment to retained earnings as of January 1, 2020. Note that the Company did not opt to delay the implementation of CECL requirements as permitted under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which allows entities to delay implementation until the earlier of (1) the date on which the national emergency concerning the Coronavirus Disease 2019 (“COVID-19”) terminates, or (2) December 31, 2020. The following table presents the impact of adopting ASC Topic 326 as of January 1, 2020: Prior to the Adjustment Adoption of to Adopt After Adoption of (dollars in thousands) ASC Topic 326 ASC Topic 326 ASC Topic 326 Assets: Allowance for Credit Losses - Loans and Leases $ 130,530 $ 770 $ 131,300 Liabilities: Reserve for Unfunded Commitments (1) 600 16,300 16,900 Pretax Cumulative Effect Adjustment of a Change in Accounting Principle 17,070 Less: Income Taxes (4,553) Cumulative-Effect Adjustment of a Change in Accounting Principle, Net of Tax $ 12,517 (1) The reserve for unfunded commitments is included as a component of other liabilities in the Company's interim consolidated balance sheets. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement Recent Accounting Pronouncements The following ASU has been issued by the FASB and is applicable to the Company in future reporting periods. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting elect any of the optional expedients provided for by this guidance. The Company is in the process of evaluating the optional expedients and the impact that this new guidance may have on the Company’s consolidated financial statements. |
Organization and Basis of Pre_3
Organization and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Organization and Basis of Presentation. | |
Impact of adopting ASC Topic 326 | The following table presents the impact of adopting ASC Topic 326 as of January 1, 2020: Prior to the Adjustment Adoption of to Adopt After Adoption of (dollars in thousands) ASC Topic 326 ASC Topic 326 ASC Topic 326 Assets: Allowance for Credit Losses - Loans and Leases $ 130,530 $ 770 $ 131,300 Liabilities: Reserve for Unfunded Commitments (1) 600 16,300 16,900 Pretax Cumulative Effect Adjustment of a Change in Accounting Principle 17,070 Less: Income Taxes (4,553) Cumulative-Effect Adjustment of a Change in Accounting Principle, Net of Tax $ 12,517 (1) The reserve for unfunded commitments is included as a component of other liabilities in the Company's interim consolidated balance sheets. |
Investment Securities (Tables)
Investment Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investment Securities | |
Schedule of amortized cost and fair value of securities | March 31, 2020 December 31, 2019 Amortized Unrealized Unrealized Fair Amortized Unrealized Unrealized Fair (dollars in thousands) Cost Gains Losses Value Cost Gains Losses Value U.S. Treasury securities $ 30,483 $ 444 $ — $ 30,927 $ 29,832 $ 56 $ — $ 29,888 Government-sponsored enterprises debt securities 26,705 16 — 26,721 101,697 19 (277) 101,439 Mortgage-backed securities: Residential - Government agency 269,947 9,016 — 278,963 290,131 2,224 (1,146) 291,209 Residential - Government-sponsored enterprises 403,682 14,289 (304) 417,667 395,039 6,126 (1,673) 399,492 Commercial - Government-sponsored enterprises 184,635 3,345 (1,196) 186,784 101,798 555 (634) 101,719 Collateralized mortgage obligations: Government agency 2,304,803 21,408 (5,333) 2,320,878 2,390,143 7,483 (16,348) 2,381,278 Government-sponsored enterprises 794,142 5,965 (3,590) 796,517 772,023 2,505 (3,909) 770,619 Total available-for-sale securities $ 4,014,397 $ 54,483 $ (10,423) $ 4,058,457 $ 4,080,663 $ 18,968 $ (23,987) $ 4,075,644 |
Schedule of amortized cost and fair value of debt securities by contractual maturity | March 31, 2020 Amortized Fair (dollars in thousands) Cost Value Due in one year or less $ — $ — Due after one year through five years 57,188 57,648 Due after five years through ten years — — Due after ten years — — 57,188 57,648 Mortgage-backed securities: Residential - Government agency 269,947 278,963 Residential - Government-sponsored enterprises 403,682 417,667 Commercial - Government-sponsored enterprises 184,635 186,784 Total mortgage-backed securities 858,264 883,414 Collateralized mortgage obligations: Government agency 2,304,803 2,320,878 Government-sponsored enterprises 794,142 796,517 Total collateralized mortgage obligations 3,098,945 3,117,395 Total available-for-sale securities $ 4,014,397 $ 4,058,457 |
Schedule of gross unrealized losses and fair values of securities in a continuous loss position | Time in Continuous Loss as of March 31, 2020 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value Mortgage-backed securities: Residential - Government-sponsored enterprises $ (211) $ 95,144 $ (93) $ 10,191 $ (304) $ 105,335 Commercial - Government-sponsored enterprises (1,196) 95,097 — — (1,196) 95,097 Collateralized mortgage obligations: Government agency (3,979) 480,482 (1,354) 94,077 (5,333) 574,559 Government-sponsored enterprises (1,242) 144,625 (2,348) 149,246 (3,590) 293,871 Total available-for-sale securities with unrealized losses $ (6,628) $ 815,348 $ (3,795) $ 253,514 $ (10,423) $ 1,068,862 Time in Continuous Loss as of December 31, 2019 Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value Government-sponsored enterprises debt securities $ (277) $ 49,716 $ — $ — $ (277) $ 49,716 Mortgage-backed securities: Residential - Government agency — — (1,146) 109,614 (1,146) 109,614 Residential - Government-sponsored enterprises (115) 76,481 (1,558) 109,025 (1,673) 185,506 Commercial - Government-sponsored enterprises (634) 38,062 — — (634) 38,062 Collateralized mortgage obligations: Government agency (8,049) 969,762 (8,299) 565,764 (16,348) 1,535,526 Government-sponsored enterprises (583) 180,785 (3,326) 209,752 (3,909) 390,537 Total available-for-sale securities with unrealized losses $ (9,658) $ 1,314,806 $ (14,329) $ 994,155 $ (23,987) $ 2,308,961 |
Loans and Leases (Tables)
Loans and Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Loans and Leases. | |
Schedule of components of loans and leases | March 31, December 31, (dollars in thousands) 2020 2019 Commercial and industrial $ 3,025,345 $ 2,743,242 Commercial real estate 3,413,014 3,463,953 Construction 572,062 519,241 Residential: Residential mortgage 3,673,455 3,768,936 Home equity line 891,698 893,239 Total residential 4,565,153 4,662,175 Consumer 1,568,073 1,620,556 Lease financing 236,623 202,483 Total loans and leases $ 13,380,270 $ 13,211,650 |
Allowance for Credit Losses (Ta
Allowance for Credit Losses (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Allowance for Credit Losses | |
Schedule of activity in the Allowance by class of loans and leases | Three Months Ended March 31, 2020 Commercial Lending Residential Lending Commercial Commercial Home and Real Lease Residential Equity (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Unallocated Total Allowance for credit losses: Balance at beginning of period $ 28,975 $ 22,325 $ 4,844 $ 424 $ 29,303 $ 9,876 $ 34,644 $ 139 $ 130,530 Adoption of ASU No. 2016-13 (16,105) 10,559 (1,803) 207 (2,793) (4,731) 15,575 (139) 770 Charge-offs (201) — — — — (8) (8,597) — (8,806) Recoveries 220 — 110 — 135 122 2,083 — 2,670 Increase in Provision 7,995 9,954 5,673 220 3,376 1,297 12,334 — 40,849 Balance at end of period $ 20,884 $ 42,838 $ 8,824 $ 851 $ 30,021 $ 6,556 $ 56,039 $ — $ 166,013 The following presents the activity in the ACL by class of loans and leases for the three months ended March 31, 2019, presented in accordance with Topic 310, Receivables Three Months Ended March 31, 2019 Commercial Lending Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Residential Consumer Unallocated Total Allowance for credit losses: Balance at beginning of period $ 34,501 $ 19,725 $ 5,813 $ 432 $ 44,906 $ 35,813 $ 528 $ 141,718 Charge-offs — — — (24) — (8,598) — (8,622) Recoveries 37 31 — — 250 2,452 — 2,770 Increase (decrease) in Provision (2,745) 1,441 (432) 3 (245) 5,432 2,226 5,680 Balance at end of period $ 31,793 $ 21,197 $ 5,381 $ 411 $ 44,911 $ 35,099 $ 2,754 $ 141,546 |
Schedule of activity in the Liability for Credit Losses for Off-Balance-Sheet Financial Instruments | Three Months Ended March 31, 2020 Commercial Lending Residential Lending Commercial Commercial Home and Real Lease Residential Equity (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Total Reserve for unfunded commitments: Balance at beginning of period $ — $ — $ — $ — $ — $ — $ 600 $ 600 Adoption of ASU No. 2016-13 5,390 778 4,119 — 7 6,587 (581) 16,300 Increase (decrease) in Provision (599) (82) 694 — (6) 340 4 351 Balance at end of period $ 4,791 $ 696 $ 4,813 $ — $ 1 $ 6,927 $ 23 $ 17,251 |
Schedule of amortized cost basis by year of origination and credit quality indicator | The amortized cost basis by year of origination and credit quality indicator of the Company's loans and leases as of March 31, 2020 was as follows: Revolving Loans Converted Term Loans Revolving to Term Amortized Cost Basis by Origination Year Loans Loans Amortized Amortized (dollars in thousands) 2020 2019 2018 2017 2016 Prior Cost Basis Cost Basis Total Commercial Lending Commercial and Industrial Risk rating: Pass $ 96,493 $ 364,221 $ 294,506 $ 86,993 $ 72,683 $ 210,731 $ 1,542,232 $ 62,021 $ 2,729,880 Special Mention 126 3,490 2,757 360 535 7,064 88,787 256 103,375 Substandard 160 7,456 3,568 1,569 57 5,465 50,830 969 70,074 Other (1) 7,239 18,375 13,894 8,985 3,859 1,247 68,417 — 122,016 Total Commercial and Industrial 104,018 393,542 314,725 97,907 77,134 224,507 1,750,266 63,246 3,025,345 Commercial Real Estate Risk rating: Pass 70,775 731,880 577,488 497,579 324,782 1,024,477 47,680 2 3,274,663 Special Mention — 8,810 17,407 23,558 28,562 27,346 2,999 — 108,682 Substandard — 24,404 — — 426 4,325 — — 29,155 Other (1) — — — — — 514 — — 514 Total Commercial Real Estate 70,775 765,094 594,895 521,137 353,770 1,056,662 50,679 2 3,413,014 Construction Risk rating: Pass 15,537 96,333 192,397 99,207 25,151 53,105 25,991 — 507,721 Special Mention — — — — — — 200 — 200 Substandard — — — 2,219 — 1,002 — — 3,221 Other (1) 2,269 31,408 14,370 6,562 1,735 4,576 — — 60,920 Total Construction 17,806 127,741 206,767 107,988 26,886 58,683 26,191 — 572,062 Lease Financing Risk rating: Pass 49,616 73,066 17,998 22,263 5,939 66,866 — — 235,748 Special Mention — 287 84 440 — 64 — — 875 Total Lease Financing 49,616 73,353 18,082 22,703 5,939 66,930 — — 236,623 Total Commercial Lending $ 242,215 $ 1,359,730 $ 1,134,469 $ 749,735 $ 463,729 $ 1,406,782 $ 1,827,136 $ 63,248 $ 7,247,044 (continued) Revolving Loans Converted Term Loans Revolving to Term Amortized Cost Basis by Origination Year Loans Loans (continued) Amortized Amortized (dollars in thousands) 2020 2019 2018 2017 2016 Prior Cost Basis Cost Basis Total Residential Lending Residential Mortgage FICO: 740 and greater $ 134,802 $ 429,854 $ 380,979 $ 437,915 $ 376,570 $ 1,044,890 $ — $ — $ 2,805,010 680 - 739 28,248 71,374 69,543 69,434 44,492 170,974 — — 454,065 620 - 679 3,527 13,645 11,235 13,074 11,621 57,611 — — 110,713 550 - 619 2,012 1,834 3,547 4,096 3,050 13,474 — — 28,013 Less than 550 — — 1,206 1,912 966 6,363 — — 10,447 No Score (3) 11,783 21,987 25,655 26,042 16,592 54,212 — — 156,271 Other (2) 4,783 20,938 26,627 25,451 12,528 17,524 580 505 108,936 Total Residential Mortgage 185,155 559,632 518,792 577,924 465,819 1,365,048 580 505 3,673,455 Home Equity Line FICO: 740 and greater — — — — — — 629,818 — 629,818 680 - 739 — — — — — — 173,990 — 173,990 620 - 679 — — — — — — 58,863 — 58,863 550 - 619 — — — — — — 16,863 — 16,863 Less than 550 — — — — — — 6,852 — 6,852 No Score (3) — — — — — — 5,312 — 5,312 Total Home Equity Line — — — — — — 891,698 — 891,698 Total Residential Lending 185,155 559,632 518,792 577,924 465,819 1,365,048 892,278 505 4,565,153 Consumer Lending FICO: 740 and greater 46,781 150,459 128,010 76,608 41,303 17,034 117,149 — 577,344 680 - 739 29,047 124,783 99,908 59,075 29,503 13,332 92,315 — 447,963 620 - 679 11,357 73,221 51,785 35,102 18,932 9,072 49,123 — 248,592 550 - 619 1,679 21,334 23,130 20,105 10,676 6,105 18,624 — 101,653 Less than 550 581 7,625 12,696 12,928 6,832 3,459 7,906 — 52,027 No Score (3) 2,796 6,248 174 151 30 3 37,382 — 46,784 Other (2) 600 9,173 104 2,230 100 6,823 74,680 — 93,710 Total Consumer Lending 92,841 392,843 315,807 206,199 107,376 55,828 397,179 — 1,568,073 Total Loans and Leases $ 520,211 $ 2,312,205 $ 1,969,068 $ 1,533,858 $ 1,036,924 $ 2,827,658 $ 3,116,593 $ 63,753 $ 13,380,270 |
Schedule of aging analyses of past due loans and leases | March 31, 2020 Past Due Loans and Greater Leases Past Than or Due 90 Days 30-59 60-89 Equal to or More and Days Days 90 Days Total Total Loans Still Accruing (dollars in thousands) Past Due Past Due Past Due Past Due Current and Leases Interest Commercial and industrial $ 6,634 $ 1,010 $ 4,041 $ 11,685 $ 3,013,660 $ 3,025,345 $ 4,007 Commercial real estate 14,204 2,706 757 17,667 3,395,347 3,413,014 757 Construction 6,003 104 2,570 8,677 563,385 572,062 148 Lease financing — — — — 236,623 236,623 — Residential mortgage 3,556 2,349 2,671 8,576 3,664,879 3,673,455 82 Home equity line 6,947 1,462 2,566 10,975 880,723 891,698 2,566 Consumer 33,077 6,223 3,353 42,653 1,525,420 1,568,073 3,353 Total $ 70,421 $ 13,854 $ 15,958 $ 100,233 $ 13,280,037 $ 13,380,270 $ 10,913 As of December 31, 2019, the aging analysis of the Company’s past due loans and leases, presented in accordance with Topic 310, Receivables December 31, 2019 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 $ 1,525 $ 808 $ 1,429 $ 3,762 $ 2,739,448 $ 2,743,210 $ 32 $ 2,743,242 Commercial real estate 1,664 1,125 1,013 3,802 3,460,121 3,463,923 30 3,463,953 Construction — — 2,367 2,367 516,874 519,241 — 519,241 Lease financing — — — — 202,483 202,483 — 202,483 Residential mortgage 3,258 399 74 3,731 3,759,799 3,763,530 5,406 3,768,936 Home equity line 2,971 394 2,995 6,360 886,879 893,239 — 893,239 Consumer 26,810 7,022 4,272 38,104 1,582,452 1,620,556 — 1,620,556 Total $ 36,228 $ 9,748 $ 12,150 $ 58,126 $ 13,148,056 $ 13,206,182 $ 5,468 $ 13,211,650 |
Schedule of revolving loans that were converted to term loans | Three Months Ended (dollars in thousands) March 31, 2020 Commercial and industrial $ 28,228 Residential mortgage 296 Total Revolving Loans Converted to Term Loans During the Period $ 28,524 |
Schedule of credit risk profiles by internally assigned grade for loans and leases | December 31, 2019 Commercial Commercial and Real Lease (dollars in thousands) Industrial Estate Construction Financing Total Grade: Pass $ 2,585,908 $ 3,327,659 $ 515,993 $ 201,461 $ 6,631,021 Special mention 91,365 106,331 127 1,022 198,845 Substandard 65,969 29,963 3,121 — 99,053 Total $ 2,743,242 $ 3,463,953 $ 519,241 $ 202,483 $ 6,928,919 |
Schedule of credit risk profiles based on payment activity for loans and leases that were not subject to loan grading | December 31, 2019 (dollars in thousands) Residential Mortgage Home Equity Line Consumer Consumer - Auto Credit Cards Total Performing $ 3,759,799 $ 886,879 $ 219,046 $ 1,016,142 $ 347,264 $ 6,229,130 Non-performing and delinquent 9,137 6,360 7,258 24,326 6,520 53,601 Total $ 3,768,936 $ 893,239 $ 226,304 $ 1,040,468 $ 353,784 $ 6,282,731 |
Schedule of amortized cost basis of loans and leases on nonaccrual status | March 31, 2020 January 1, 2020 Nonaccrual Loans and Leases With No Nonaccrual Nonaccrual Allowance Loans Loans (dollars in thousands) for Credit Losses and Leases and Leases Commercial and industrial $ — $ 32 $ 32 Commercial real estate — — 30 Construction — 2,422 — Residential mortgage 806 4,472 5,406 Total Nonaccrual Loans and Leases $ 806 $ 6,926 $ 5,468 |
Schedule of information related to loans modified in a TDR | Three Months Ended Three Months Ended March 31, 2020 March 31, 2019 Number of Recorded Related Number of Recorded Related (dollars in thousands) Contracts Investment (1) Allowance Contracts Investment (1) Allowance Commercial and industrial 1 $ 500 $ 30 4 $ 916 $ 24 Residential mortgage — — — 1 352 14 Total 1 $ 500 $ 30 5 $ 1,268 $ 38 (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. |
Mortgage Servicing Rights (Tabl
Mortgage Servicing Rights (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Mortgage Servicing Rights | |
Schedule of estimated future amortization expense for MSRs | Estimated (dollars in thousands) Amortization Under one year $ 2,535 One to two years 2,047 Two to three years 1,651 Three to four years 1,341 Four to five years 1,101 |
Schedule of details of the Company's MSRs | March 31, December 31, (dollars in thousands) 2020 2019 Gross carrying amount $ 64,771 $ 63,480 Less: accumulated amortization 52,792 50,812 Net carrying value $ 11,979 $ 12,668 |
Schedule of changes in amortized MSRs | Three Months Ended March 31, (dollars in thousands) 2020 2019 Balance at beginning of period $ 12,668 $ 16,155 Originations 1,291 8 Amortization (1,980) (764) Balance at end of period $ 11,979 $ 15,399 Fair value of amortized MSRs at beginning of period $ 20,329 $ 27,662 Fair value of amortized MSRs at end of period $ 17,615 $ 26,383 |
Schedule of quantitative assumptions used in determining lower of cost or fair value of MSRs | March 31, 2020 December 31, 2019 Weighted Weighted Range Average Range Average Conditional prepayment rate 14.17 % - 24.82 % 14.45 % 10.74 % - 23.39 % 11.10 % Life in years (of the MSR) 1.93 - 5.26 5.00 2.04 - 6.33 5.99 Weighted-average coupon rate 3.93 % - 7.22 % 3.99 % 3.96 % - 7.26 % 4.01 % Discount rate 10.00 % - 10.00 % 10.00 % 10.00 % - 10.01 % 10.00 % |
Transfers of Financial Assets (
Transfers of Financial Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Transfers of Financial Assets | |
Schedule of carrying amounts of assets pledged as collateral | (dollars in thousands) March 31, 2020 December 31, 2019 Public deposits $ 1,997,472 $ 1,543,492 Federal Home Loan Bank 3,008,321 2,928,581 Federal Reserve Bank 1,250,553 953,169 ACH transactions 152,967 155,360 Interest rate swaps 55,831 43,296 Total $ 6,465,144 $ 5,623,898 |
Deposits (Tables)
Deposits (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Deposits | |
Schedule of deposits by category | (dollars in thousands) March 31, 2020 December 31, 2019 U.S.: Interest-bearing $ 10,539,824 $ 9,782,957 Noninterest-bearing 5,073,463 5,188,696 Foreign: Interest-bearing 734,639 781,965 Noninterest-bearing 672,076 691,376 Total deposits $ 17,020,002 $ 16,444,994 |
Schedule of maturity distribution of time certificates of deposit | The following table presents the maturity distribution of time certificates of deposit as of March 31, 2020: Under $250,000 (dollars in thousands) $250,000 or More Total Three months or less $ 248,179 $ 490,557 $ 738,736 Over three through six months 151,083 570,240 721,323 Over six through twelve months 385,105 551,485 936,590 One to two years 112,964 83,388 196,352 Two to three years 121,995 59,604 181,599 Three to four years 77,139 12,754 89,893 Four to five years 41,639 6,053 47,692 Thereafter 113 — 113 Total $ 1,138,217 $ 1,774,081 $ 2,912,298 |
Short-Term Borrowings (Tables)
Short-Term Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Short-Term Borrowings | |
Schedule of short-term borrowings | (dollars in thousands) March 31, 2020 December 31, 2019 Short-term FHLB fixed-rate advances (1) $ 400,000 $ 400,000 Total short-term borrowings $ 400,000 $ 400,000 (1) Interest is payable monthly. |
Long-Term Borrowings (Tables)
Long-Term Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Long-Term Borrowings | |
Schedule of long-term borrowings | (dollars in thousands) March 31, 2020 December 31, 2019 Finance lease $ 19 $ 19 FHLB fixed-rate advances (1) 200,000 200,000 Total long-term borrowings $ 200,019 $ 200,019 (1) Interest is payable monthly. |
Schedule of future contractual principal payments on long-term borrowings | Principal (dollars in thousands) Payments 2020 $ 9 2021 10 2022 — 2023 (1) 100,000 2024 (2) 100,000 Total $ 200,019 (1) FHLB fixed-rate advance callable on December 4, 2020 with an interest rate of 2.80% . (2) FHLB fixed-rate advance callable on January 15, 2021 with an interest rate of 2.65% . |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss). | |
Schedule of changes in accumulated other comprehensive income (loss) | Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2019 $ (43,450) $ 11,701 $ (31,749) Three months ended March 31, 2020 Change in Company tax rate — (96) (96) Net change in pension and other benefits — (96) (96) Investment securities: Unrealized net gains arising during the period 49,164 (13,128) 36,036 Reclassification of net gains to net income: Investment securities gains, net (85) 23 (62) Net change in investment securities 49,079 (13,105) 35,974 Other comprehensive income 49,079 (13,201) 35,878 Accumulated other comprehensive income at March 31, 2020 $ 5,629 $ (1,500) $ 4,129 Income Tax Pre-tax Benefit Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2018 $ (180,915) $ 48,720 $ (132,195) Three months ended March 31, 2019 Investment securities: Unrealized net gains arising during the period 70,523 (18,991) 51,532 Reclassification of net losses to net income: Investment securities losses, net 2,613 (704) 1,909 Net change in investment securities 73,136 (19,695) 53,441 Other comprehensive income 73,136 (19,695) 53,441 Accumulated other comprehensive loss at March 31, 2019 $ (107,779) $ 29,025 $ (78,754) |
Summary of changes in accumulated other comprehensive income (loss), net of tax | Pensions Accumulated and Other Other Investment Comprehensive (dollars in thousands) Benefits Securities Income (Loss) Three Months Ended March 31, 2020 Balance at beginning of period $ (28,082) $ (3,667) $ (31,749) Other comprehensive income (96) 35,974 35,878 Balance at end of period $ (28,178) $ 32,307 $ 4,129 Three Months Ended March 31, 2019 Balance at beginning of period $ (28,379) $ (103,816) $ (132,195) Other comprehensive income — 53,441 53,441 Balance at end of period $ (28,379) $ (50,375) $ (78,754) |
Regulatory Capital Requiremen_2
Regulatory Capital Requirements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Regulatory Capital Requirements | |
Schedule of regulatory capital ratios | First Hawaiian Minimum Well- First Hawaiian, Inc. Bank Capital Capitalized (dollars in thousands) Amount Ratio Amount Ratio Ratio (1) Ratio (1) March 31, 2020: Common equity tier 1 capital to risk-weighted assets $ 1,665,064 11.65 % $ 1,645,403 11.51 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,665,064 11.65 % 1,645,403 11.51 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,843,775 12.90 % 1,824,118 12.76 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,665,064 8.63 % 1,645,403 8.52 % 4.00 % 5.00 % December 31, 2019: Common equity tier 1 capital to risk-weighted assets $ 1,676,515 11.88 % $ 1,654,304 11.72 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets 1,676,515 11.88 % 1,654,304 11.72 % 6.00 % 8.00 % Total capital to risk-weighted assets 1,807,645 12.81 % 1,785,434 12.65 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) 1,676,515 8.79 % 1,654,304 8.67 % 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”). |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Financial Instruments | |
Summary of notional amounts and fair values of derivatives held | March 31, 2020 December 31, 2019 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 $ 23,190 $ — $ (1,635) $ 23,190 $ — $ (682) Derivatives not designated as hedging instruments: Interest rate swaps 2,901,085 158,711 — 2,818,803 63,527 — Funding swap 85,645 — (3,199) 82,900 — (4,233) Foreign exchange contracts 1,834 — (52) 1,428 12 — (1) The positive fair values of derivative assets are included in other assets. (2) The negative fair values of derivative liabilities are included in other liabilities. |
Schedule of net gains and losses recognized in income related to derivatives in fair value hedging relationships | Gains (losses) recognized in the consolidated statements March 31, (dollars in of income line item 2020 2019 Gains (losses) on fair value hedging relationships recognized in interest income: Recognized on interest rate swap Loans and lease financing $ (955) $ (342) Recognized on hedged item Loans and lease financing 906 262 |
Schedule of amounts related to cumulative basis adjustments for fair value hedges | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Asset Carrying Amount of the Hedged Asset (dollars in March 31, 2020 December 31, 2019 March 31, 2020 December 31, 2019 Line item in the consolidated balance sheets in which the hedged item is included Loans and leases $ 25,146 $ 24,415 $ 1,923 $ 1,017 |
Summary of impact on pretax earnings of derivatives not designated as hedges | Net gains (losses) recognized in the consolidated statements March 31, (dollars in of income line item 2020 2019 Derivatives Not Designated As Hedging Instruments: Interest rate swaps Other noninterest income $ — $ 16 Funding swap Other noninterest income 6 5 Foreign exchange contracts Other noninterest income (52) — |
Commitments and Contingent Li_2
Commitments and Contingent Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingent Liabilities | |
Schedule of financial instruments with off-balance sheet risk | March 31, December 31, (dollars in 2020 2019 Financial instruments whose contract amounts represent credit risk: Commitments to extend credit $ 5,727,850 $ 5,907,690 Standby letters of credit 185,315 181,412 Commercial letters of credit 8,850 7,334 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contracts with Customers | |
Summary of revenues disaggregated by type of service and business segments | Three Months Ended March 31, 2020 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Net interest income (1) $ 89,883 $ 34,414 $ 14,386 $ 138,683 Service charges on deposit accounts 8,088 351 511 8,950 Credit and debit card fees — 12,887 1,599 14,486 Other service charges and fees 4,875 424 516 5,815 Trust and investment services income 9,591 — — 9,591 Other 185 1,106 188 1,479 Not in scope of Topic 606 (1) 3,637 3,028 2,242 8,907 Total noninterest income 26,376 17,796 5,056 49,228 Total revenue $ 116,259 $ 52,210 $ 19,442 $ 187,911 (1) Most of the Company’s revenue is not within the scope of ASU No. 2014-09, Revenue from Contracts with Customers. The guidance explicitly excludes net interest income from financial assets and liabilities as well as other noninterest income from loans, leases, investment securities and derivative financial instruments. Three Months Ended March 31, 2019 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Net interest income (1) $ 107,227 $ 34,656 $ 3,206 $ 145,089 Service charges on deposit accounts 7,234 310 516 8,060 Credit and debit card fees — 19,707 1,727 21,434 Other service charges and fees 5,333 369 542 6,244 Trust and investment services income 8,618 — — 8,618 Other 215 1,509 208 1,932 Not in scope of Topic 606 (1) 2,469 (3,507) 1,822 784 Total noninterest income 23,869 18,388 4,815 47,072 Total revenue $ 131,096 $ 53,044 $ 8,021 $ 192,161 (1) Most of the Company’s revenue is not within the scope of ASU No. 2014-09, Revenue from Contracts with Customers. The guidance explicitly excludes net interest income from financial assets and liabilities as well as other noninterest income from loans, leases, investment securities and derivative financial instruments. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings per Share | |
Schedule of computations of basic and diluted earnings per share | Three Months Ended March 31, (dollars in 2020 2019 Numerator: Net income $ 38,865 $ 69,924 Denominator: Basic: weighted-average shares outstanding 129,895,706 134,879,336 Add: weighted-average equity-based awards 455,879 319,009 Diluted: weighted-average shares outstanding 130,351,585 135,198,345 Basic earnings per share $ 0.30 $ 0.52 Diluted earnings per share $ 0.30 $ 0.52 |
Noninterest Income and Nonint_2
Noninterest Income and Noninterest Expense (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Noninterest Income and Noninterest Expense | |
Schedule of components of net periodic benefit cost | Income line item where recognized in Pension Benefits Other Benefits (dollars in the consolidated statements of income 2020 2019 2020 2019 Three Months Ended March 31, Service cost Salaries and employee benefits $ — $ 17 $ 189 $ 159 Interest cost Other noninterest expense 1,621 2,044 164 206 Expected return on plan assets Other noninterest expense (1,194) (1,195) — — Prior service credit Other noninterest expense — — (13) (107) Recognized net actuarial loss (gain) Other noninterest expense 1,429 1,564 (26) (76) Total net periodic benefit cost $ 1,856 $ 2,430 $ 314 $ 182 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value | |
Schedule of assets and liabilities measured at fair value on a recurring basis | Fair Value Measurements as of March 31, 2020 Quoted Prices in Significant Active Markets for Other Significant Identical Assets Observable Unobservable (dollars in (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets U.S. Treasury securities $ — $ 30,927 $ — $ 30,927 Government-sponsored enterprises debt securities — 26,721 — 26,721 Mortgage-backed securities: Residential - Government agency (1) — 278,963 — 278,963 Residential - Government-sponsored enterprises (1) — 417,667 — 417,667 Commercial - Government-sponsored enterprises — 186,784 — 186,784 Collateralized mortgage obligations: Government agency — 2,320,878 — 2,320,878 Government-sponsored enterprises — 796,517 — 796,517 Total available-for-sale securities — 4,058,457 — 4,058,457 Other assets (2) — 158,711 — 158,711 Liabilities Other liabilities (3) — (1,687) (3,199) (4,886) Total $ — $ 4,215,481 $ (3,199) $ 4,212,282 (1) Backed by residential real estate. (2) Other assets include derivative assets. (3) Other liabilities include derivative liabilities. Fair Value Measurements as of December 31, 2019 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 $ — $ 29,888 $ — $ 29,888 Government-sponsored enterprises debt securities — 101,439 — 101,439 Mortgage-backed securities: Residential - Government agency (1) — 291,209 — 291,209 Residential - Government-sponsored enterprises (1) — 399,492 — 399,492 Commercial - Government-sponsored enterprises — 101,719 — 101,719 Collateralized mortgage obligations: Government agency — 2,381,278 — 2,381,278 Government-sponsored enterprises — 770,619 — 770,619 Total available-for-sale securities — 4,075,644 — 4,075,644 Other assets (2) — 63,539 — 63,539 Liabilities Other liabilities (3) — (682) (4,233) (4,915) Total $ — $ 4,138,501 $ (4,233) $ 4,134,268 (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 2020 2019 Three Months Ended March 31, Balance as of January 1, $ (4,233) $ (2,607) Total net gains included in other noninterest income 6 5 Settlements 1,028 763 Balance as of March 31, $ (3,199) $ (1,839) Total net gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of March 31, $ 6 $ 5 |
Summary of estimated fair value of financial instruments not required to be carried at fair value on a recurring basis | March 31, 2020 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: Cash and cash equivalents $ 1,052,832 $ 353,908 $ 698,924 $ — $ 1,052,832 Loans held for sale 8,180 — 8,180 — 8,180 Loans (1) 13,143,647 — — 13,452,051 13,452,051 Financial liabilities: Time deposits (2) $ 2,912,298 $ — $ 2,922,389 $ — $ 2,922,389 Short-term borrowings 400,000 — 401,418 — 401,418 Long-term borrowings (3) 200,000 — 215,788 — 215,788 December 31, 2019 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: Cash and cash equivalents $ 694,017 $ 360,375 $ 333,642 $ — $ 694,017 Loans held for sale 904 — 904 — 904 Loans (1) 13,009,167 — — 13,140,898 13,140,898 Financial liabilities: Time deposits (2) $ 2,510,157 $ — $ 2,501,478 $ — $ 2,501,478 Short-term borrowings 400,000 — 401,709 — 401,709 Long-term borrowings (3) 200,000 — 207,104 — 207,104 (1) Excludes financing leases of $236.6 million at March 31, 2020 and $202.5 million at December 31, 2019. (2) Excludes deposit liabilities with no defined or contractual maturity of $14.1 billion as of March 31, 2020 and $13.9 billion as of December 31, 2019. (3) Excludes capital lease obligations of $19 thousand as of both March 31, 2020 and December 31, 2019. |
Schedule of assets with fair value adjustments on a nonrecurring basis | (dollars Level 1 Level 2 Level 3 March 31, 2020 Collateral-dependent loans $ — $ — $ 1,840 December 31, 2019 Collateral-dependent loans $ — $ — $ 1,502 |
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 March 31, 2020 Significant (dollars in thousands) Fair value Valuation Technique Unobservable Input Range Collateral-dependent loans $ 1,840 Appraisal Value Appraisal Value n/m (1) Visa derivative $ (3,199) Discounted Cash Flow Expected Conversation Rate - 1.6228 (2) 1.5977 -1.6228 Expected Term - 1 year (3) 0.5 to 1.5 years Growth Rate - 13% (4) 4% - 17% (1) The fair value of these assets is determined based on appraised values of the collateral or broker opinions, the range of which is not meaningful to disclose. (2) Due to the uncertainty in the movement of the conversion rate, the current conversion rate was utilized in the fair value calculation. (3) The expected term of 1 year was based on the median of 0.5 to 1.5 years. (4) The growth rate of 13% was based on the arithmetic average of analyst price targets. Quantitative Information about Level 3 Fair Value Measurements at December 31, 2019 Significant (dollars in thousands) Fair value Valuation Technique Unobservable Input Collateral-dependent loans $ 1,502 Appraisal Value Appraisal Value Visa derivative $ (4,233) Discounted Cash Flow Expected Conversion Rate - 1.6228 Expected Term - 1 year Growth Rate - 13% |
Reportable Operating Segments (
Reportable Operating Segments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Reportable Operating Segments | |
Schedule of selected business segment financial information | Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended March 31, 2020 Net interest income $ 89,883 $ 34,414 $ 14,386 $ 138,683 Provision for credit losses (20,065) (20,784) (351) (41,200) Net interest income after provision for credit losses 69,818 13,630 14,035 97,483 Noninterest income 26,376 17,796 5,056 49,228 Noninterest expense (61,644) (21,505) (13,317) (96,466) Income before provision for income taxes 34,550 9,921 5,774 50,245 Provision for income taxes (7,523) (2,645) (1,212) (11,380) Net income $ 27,027 $ 7,276 $ 4,562 $ 38,865 Treasury Retail Commercial and (dollars in thousands) Banking Banking Other Total Three Months Ended March 31, 2019 Net interest income $ 107,227 $ 34,656 $ 3,206 $ 145,089 Provision for credit losses (2,572) (3,108) — (5,680) Net interest income after provision for credit losses 104,655 31,548 3,206 139,409 Noninterest income 23,869 18,388 4,815 47,072 Noninterest expense (57,167) (19,485) (15,971) (92,623) Income (loss) before (provision) benefit for income taxes 71,357 30,451 (7,950) 93,858 (Provision) benefit for income taxes (18,047) (7,921) 2,034 (23,934) Net income (loss) $ 53,310 $ 22,530 $ (5,916) $ 69,924 |
Organization and Basis of Pre_4
Organization and Basis of Presentation - Subsidiary Ownership (Details) | Mar. 31, 2020 |
First Hawaiian, Inc. (FHI) | |
Capitalization | |
Outstanding common stock owned (as a percent) | 100.00% |
Organization and Basis of Pre_5
Organization and Basis of Presentation - Investment Securities (Details) | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Organization and Basis of Presentation. | |
Accrued interest receivable related to available-for-sale investment securities | $ 8,500,000 |
Expectation that nonpayment of the amortized cost basis | 0 |
Allowance for credit losses for its available-for-sale debt securities | $ 0 |
Organization and Basis of Pre_6
Organization and Basis of Presentation - Loans and Leases (Details) $ in Millions | Mar. 31, 2020USD ($) |
Organization and Basis of Presentation. | |
Accrued interest receivable related to loans and leases recorded separately | $ 35.1 |
Organization and Basis of Pre_7
Organization and Basis of Presentation - Accounting Standards Adopted (Details) - USD ($) $ in Thousands | Jan. 01, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Assets | |||||
Allowance for Credit Losses - Loans and Leases | $ 131,300 | $ 166,013 | $ 130,530 | $ 141,546 | $ 141,718 |
Liabilities | |||||
Reserve for Unfunded Commitments | 16,900 | ||||
Prior to Adoption | ASC Topic 326 | |||||
Assets | |||||
Allowance for Credit Losses - Loans and Leases | 130,530 | ||||
Liabilities | |||||
Reserve for Unfunded Commitments | 600 | ||||
After Adoption | ASC Topic 326 | |||||
Assets | |||||
Allowance for Credit Losses - Loans and Leases | 770 | ||||
Liabilities | |||||
Reserve for Unfunded Commitments | 16,300 | ||||
Pretax Cumulative Effect Adjustment of a Change in Accounting Principle | 17,070 | ||||
Less: Income Taxes | (4,553) | ||||
Cumulative-Effect Adjustment of a Change in Accounting Principle, Net of Tax | $ 12,517 |
Investment Securities - Amortiz
Investment Securities - Amortized Cost and Fair Value of Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Available for sale debt securities | ||
Amortized Cost | $ 4,014,397 | $ 4,080,663 |
Unrealized Gains | 54,483 | 18,968 |
Unrealized Losses | (10,423) | (23,987) |
Fair value | 4,058,457 | 4,075,644 |
U.S. Treasury securities | ||
Available for sale debt securities | ||
Amortized Cost | 30,483 | 29,832 |
Unrealized Gains | 444 | 56 |
Fair value | 30,927 | 29,888 |
Government-sponsored enterprises debt securities | ||
Available for sale debt securities | ||
Amortized Cost | 26,705 | 101,697 |
Unrealized Gains | 16 | 19 |
Unrealized Losses | (277) | |
Fair value | 26,721 | 101,439 |
Residential - Government agency | ||
Available for sale debt securities | ||
Amortized Cost | 269,947 | 290,131 |
Unrealized Gains | 9,016 | 2,224 |
Unrealized Losses | (1,146) | |
Fair value | 278,963 | 291,209 |
Residential - Government-sponsored enterprises | ||
Available for sale debt securities | ||
Amortized Cost | 403,682 | 395,039 |
Unrealized Gains | 14,289 | 6,126 |
Unrealized Losses | (304) | (1,673) |
Fair value | 417,667 | 399,492 |
Commercial - Government-sponsored enterprises | ||
Available for sale debt securities | ||
Amortized Cost | 184,635 | 101,798 |
Unrealized Gains | 3,345 | 555 |
Unrealized Losses | (1,196) | (634) |
Fair value | 186,784 | 101,719 |
Government agency | ||
Available for sale debt securities | ||
Amortized Cost | 2,304,803 | 2,390,143 |
Unrealized Gains | 21,408 | 7,483 |
Unrealized Losses | (5,333) | (16,348) |
Fair value | 2,320,878 | 2,381,278 |
Government-sponsored enterprises | ||
Available for sale debt securities | ||
Amortized Cost | 794,142 | 772,023 |
Unrealized Gains | 5,965 | 2,505 |
Unrealized Losses | (3,590) | (3,909) |
Fair value | $ 796,517 | $ 770,619 |
Investment Securities - Proceed
Investment Securities - Proceeds from Calls and Sales, Realized Gains and Losses and Interest Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Proceeds from calls and sales of investment securities | ||
Proceeds from calls of available for sale securities | $ 75 | $ 0 |
Proceeds from sales of available for sale securities | 3.5 | 863.1 |
Debt Securities, Available-for-sale, Realized Gain (Loss) [Abstract] | ||
Gross realized gains on sales of investment securities | 0.1 | 0 |
Gross realized losses on sales of investment securities | 0 | 2.6 |
Income tax benefit related to net realized loss on sale of investment securities | 0 | 0.7 |
Income tax expense related to net realized gains on sale of investment securities | 0 | 0 |
Interest income from taxable and nontaxable investment securities | ||
Taxable interest income | 21.2 | 24.5 |
Non-taxable interest income | $ 0 | $ 0 |
Investment Securities - Contrac
Investment Securities - Contractual Maturity (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Amortized Cost | ||
Due after one year through five years | $ 57,188 | |
Total contractual maturities | 57,188 | |
Amortized Cost | 4,014,397 | $ 4,080,663 |
Fair Value | ||
Due after one year through five years | 57,648 | |
Total contractual maturities | 57,648 | |
Fair value | 4,058,457 | 4,075,644 |
Mortgage-backed securities: | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 858,264 | |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 883,414 | |
Residential - Government agency | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 269,947 | |
Amortized Cost | 269,947 | 290,131 |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 278,963 | |
Fair value | 278,963 | 291,209 |
Residential - Government-sponsored enterprises | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 403,682 | |
Amortized Cost | 403,682 | 395,039 |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 417,667 | |
Fair value | 417,667 | 399,492 |
Commercial - Government-sponsored enterprises | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 184,635 | |
Amortized Cost | 184,635 | 101,798 |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 186,784 | |
Fair value | 186,784 | 101,719 |
Collateralized mortgage obligations | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 3,098,945 | |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 3,117,395 | |
Government agency | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 2,304,803 | |
Amortized Cost | 2,304,803 | 2,390,143 |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 2,320,878 | |
Fair value | 2,320,878 | 2,381,278 |
Government-sponsored enterprises | ||
Amortized Cost | ||
Government debt securities, mortgaged-backed securities and obligations | 794,142 | |
Amortized Cost | 794,142 | 772,023 |
Fair Value | ||
Government debt securities, mortgaged-backed securities and collateralized mortgage obligations | 796,517 | |
Fair value | $ 796,517 | $ 770,619 |
Investment Securities - Pledged
Investment Securities - Pledged Securities and Concentration (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Pledged securities | ||
Total pledged securities | $ 2,200,000,000 | $ 1,800,000,000 |
Securities pledged to secure public deposits | 1,997,472,000 | 1,543,492,000 |
Securities pledged to secure other financial transactions | 246,800,000 | 242,300,000 |
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 | Mar. 31, 2020USD ($)security | Dec. 31, 2019USD ($)security |
Securities in the available-for-sale portfolio in a continuous loss position | ||
Number of individual securities in a continuous loss position | security | 55 | 118 |
Time in Continuous Loss, Unrealized Losses | ||
Less Than 12 Months Unrealized Losses | $ (6,628) | $ (9,658) |
12 Months or More Unrealized Losses | (3,795) | (14,329) |
Total Unrealized Losses | (10,423) | (23,987) |
Time in Continuous Loss, Fair Value | ||
Less Than 12 Months Fair Value | 815,348 | 1,314,806 |
12 Months or More Fair Value | 253,514 | 994,155 |
Total Fair Value | 1,068,862 | 2,308,961 |
Government-sponsored enterprises debt securities | ||
Time in Continuous Loss, Unrealized Losses | ||
Less Than 12 Months Unrealized Losses | (277) | |
Total Unrealized Losses | (277) | |
Time in Continuous Loss, Fair Value | ||
Less Than 12 Months Fair Value | 49,716 | |
Total Fair Value | 49,716 | |
Residential - Government agency | ||
Time in Continuous Loss, Unrealized Losses | ||
12 Months or More Unrealized Losses | (1,146) | |
Total Unrealized Losses | (1,146) | |
Time in Continuous Loss, Fair Value | ||
12 Months or More Fair Value | 109,614 | |
Total Fair Value | 109,614 | |
Residential - Government-sponsored enterprises | ||
Time in Continuous Loss, Unrealized Losses | ||
Less Than 12 Months Unrealized Losses | (211) | (115) |
12 Months or More Unrealized Losses | (93) | (1,558) |
Total Unrealized Losses | (304) | (1,673) |
Time in Continuous Loss, Fair Value | ||
Less Than 12 Months Fair Value | 95,144 | 76,481 |
12 Months or More Fair Value | 10,191 | 109,025 |
Total Fair Value | 105,335 | 185,506 |
Commercial - Government-sponsored enterprises | ||
Time in Continuous Loss, Unrealized Losses | ||
Less Than 12 Months Unrealized Losses | (1,196) | (634) |
Total Unrealized Losses | (1,196) | (634) |
Time in Continuous Loss, Fair Value | ||
Less Than 12 Months Fair Value | 95,097 | 38,062 |
Total Fair Value | 95,097 | 38,062 |
Government agency | ||
Time in Continuous Loss, Unrealized Losses | ||
Less Than 12 Months Unrealized Losses | (3,979) | (8,049) |
12 Months or More Unrealized Losses | (1,354) | (8,299) |
Total Unrealized Losses | (5,333) | (16,348) |
Time in Continuous Loss, Fair Value | ||
Less Than 12 Months Fair Value | 480,482 | 969,762 |
12 Months or More Fair Value | 94,077 | 565,764 |
Total Fair Value | 574,559 | 1,535,526 |
Government-sponsored enterprises | ||
Time in Continuous Loss, Unrealized Losses | ||
Less Than 12 Months Unrealized Losses | (1,242) | (583) |
12 Months or More Unrealized Losses | (2,348) | (3,326) |
Total Unrealized Losses | (3,590) | (3,909) |
Time in Continuous Loss, Fair Value | ||
Less Than 12 Months Fair Value | 144,625 | 180,785 |
12 Months or More Fair Value | 149,246 | 209,752 |
Total Fair Value | $ 293,871 | $ 390,537 |
Investment Securities - Visa Cl
Investment Securities - Visa Class B Restricted Shares (Details) $ in Thousands | 12 Months Ended | |||||||||
Dec. 31, 2016USD ($)shares | Dec. 31, 2008USD ($)shares | Mar. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares | Oct. 31, 2019USD ($) | Sep. 27, 2019 | Jun. 30, 2019 | Jul. 31, 2018USD ($) | Jun. 28, 2018 | Dec. 31, 2017 | |
Visa | Class B restricted shares | ||||||||||
Visa Class B Restricted Shares | ||||||||||
Historical cost included in the balance sheets | $ 0 | |||||||||
Net realized gain related to the sale of stock | $ 22,700 | |||||||||
Number of shares sold | shares | 274,000 | |||||||||
Estimated liability that was subsequently paid to the buyer | $ 300 | |||||||||
Shares held | shares | 120,000 | 120,000 | ||||||||
Cost basis | $ 0 | $ 0 | ||||||||
Funding Swap (Visa Derivative) | Class B restricted shares | ||||||||||
Visa Class B Restricted Shares | ||||||||||
Conversion rate | 1.6228 | 1.6298 | 1.6298 | 1.6483 | ||||||
Funding Swap (Visa Derivative) | Visa | ||||||||||
Visa Class B Restricted Shares | ||||||||||
Estimated liability that was subsequently paid to the buyer | $ 300 | $ 700 | ||||||||
Visa | Class B restricted shares | ||||||||||
Visa Class B Restricted Shares | ||||||||||
Stock received in initial public offering (in shares) | shares | 394,000 |
Loans and Leases - Components (
Loans and Leases - Components (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Loans and leases | ||
Loans and leases | $ 13,380,270 | $ 13,211,650 |
Outstanding loan balances, deferred loan costs and fees | 40,600 | 41,000 |
Residential real estate loans pledged to collateralize the borrowing capacity at the FHLB | 3,000,000 | 2,900,000 |
Consumer and commercial and industrial loans pledged to collateralize the borrowing capacity at the FRB | 1,300,000 | 953,200 |
Real estate | ||
Loans and leases | ||
Loans and leases | 4,565,153 | 4,662,175 |
Commercial and Industrial | ||
Loans and leases | ||
Loans and leases | 3,025,345 | 2,743,242 |
Commercial real estate | ||
Loans and leases | ||
Loans and leases | 3,413,014 | 3,463,953 |
Commercial real estate | Real estate | ||
Loans and leases | ||
Loans and leases | 3,413,014 | 3,463,953 |
Construction | ||
Loans and leases | ||
Loans and leases | 572,062 | 519,241 |
Construction | Real estate | ||
Loans and leases | ||
Loans and leases | 572,062 | 519,241 |
Residential | ||
Loans and leases | ||
Loans and leases | 4,662,175 | |
Real estate loans in the process of foreclosure | 3,100 | 4,100 |
Residential | Real estate | ||
Loans and leases | ||
Loans and leases | 3,673,455 | 3,768,936 |
Consumer | ||
Loans and leases | ||
Loans and leases | 1,568,073 | 1,620,556 |
Lease financing | ||
Loans and leases | ||
Loans and leases | 236,623 | 202,483 |
Home equity line | Real estate | ||
Loans and leases | ||
Loans and leases | 891,698 | 893,239 |
Residential mortgage | Residential | ||
Loans and leases | ||
Loans and leases | 3,673,455 | 3,768,936 |
Home equity | Home equity Line | ||
Loans and leases | ||
Loans and leases | $ 891,698 | $ 893,239 |
Allowance for Credit Losses - A
Allowance for Credit Losses - Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Allowance for loan and lease losses: | |||
Balance at beginning of period | $ 130,530 | $ 141,718 | |
Adoption of ASU 2016-13 | $ 770 | ||
Charge-offs | (8,806) | (8,622) | |
Recoveries | 2,670 | 2,770 | |
Increase (decrease) in Provision | 40,849 | 5,680 | |
Balance at end of period | 166,013 | 141,546 | |
Commercial and Industrial | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 28,975 | 34,501 | |
Adoption of ASU 2016-13 | (16,105) | ||
Charge-offs | (201) | ||
Recoveries | 220 | 37 | |
Increase (decrease) in Provision | 7,995 | (2,745) | |
Balance at end of period | 20,884 | 31,793 | |
Commercial real estate | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 22,325 | 19,725 | |
Adoption of ASU 2016-13 | 10,559 | ||
Recoveries | 31 | ||
Increase (decrease) in Provision | 9,954 | 1,441 | |
Balance at end of period | 42,838 | 21,197 | |
Construction | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 4,844 | 5,813 | |
Adoption of ASU 2016-13 | (1,803) | ||
Recoveries | 110 | ||
Increase (decrease) in Provision | 5,673 | (432) | |
Balance at end of period | 8,824 | 5,381 | |
Lease financing | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 424 | 432 | |
Adoption of ASU 2016-13 | 207 | ||
Charge-offs | (24) | ||
Increase (decrease) in Provision | 220 | 3 | |
Balance at end of period | 851 | 411 | |
Residential | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 39,179 | ||
Consumer | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 34,644 | 35,813 | |
Adoption of ASU 2016-13 | 15,575 | ||
Charge-offs | (8,597) | (8,598) | |
Recoveries | 2,083 | 2,452 | |
Increase (decrease) in Provision | 12,334 | 5,432 | |
Balance at end of period | 56,039 | 35,099 | |
Unallocated | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 139 | 528 | |
Adoption of ASU 2016-13 | (139) | ||
Increase (decrease) in Provision | 2,226 | ||
Balance at end of period | 2,754 | ||
Residential mortgage | Residential | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 29,303 | 44,906 | |
Adoption of ASU 2016-13 | (2,793) | ||
Recoveries | 135 | 250 | |
Increase (decrease) in Provision | 3,376 | (245) | |
Balance at end of period | 30,021 | $ 44,911 | |
Home equity | Residential | |||
Allowance for loan and lease losses: | |||
Balance at beginning of period | 9,876 | ||
Adoption of ASU 2016-13 | $ (4,731) | ||
Charge-offs | (8) | ||
Recoveries | 122 | ||
Increase (decrease) in Provision | 1,297 | ||
Balance at end of period | $ 6,556 |
Allowance for Credit Losses - D
Allowance for Credit Losses - Disaggregation of ACL by Impairment Methodology (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Jan. 01, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Allowance for loan and lease losses: | |||||
Individually evaluated for impairment | $ 203 | ||||
Collectively evaluated for impairment | 130,327 | ||||
Total allowance for loan and lease losses | $ 166,013 | $ 131,300 | 130,530 | $ 141,546 | $ 141,718 |
Loans and leases: | |||||
Individually evaluated for impairment | 20,638 | ||||
Collectively evaluated for impairment | 13,191,012 | ||||
Total loans and leases | 13,380,270 | 13,211,650 | |||
Commercial and Industrial | |||||
Allowance for loan and lease losses: | |||||
Individually evaluated for impairment | 46 | ||||
Collectively evaluated for impairment | 28,929 | ||||
Total allowance for loan and lease losses | 20,884 | 28,975 | 31,793 | 34,501 | |
Loans and leases: | |||||
Individually evaluated for impairment | 4,951 | ||||
Collectively evaluated for impairment | 2,738,291 | ||||
Total loans and leases | 3,025,345 | 2,743,242 | |||
Commercial real estate | |||||
Allowance for loan and lease losses: | |||||
Individually evaluated for impairment | 27 | ||||
Collectively evaluated for impairment | 22,298 | ||||
Total allowance for loan and lease losses | 42,838 | 22,325 | 21,197 | 19,725 | |
Loans and leases: | |||||
Individually evaluated for impairment | 723 | ||||
Collectively evaluated for impairment | 3,463,230 | ||||
Total loans and leases | 3,413,014 | 3,463,953 | |||
Construction | |||||
Allowance for loan and lease losses: | |||||
Collectively evaluated for impairment | 4,844 | ||||
Total allowance for loan and lease losses | 8,824 | 4,844 | 5,381 | 5,813 | |
Loans and leases: | |||||
Collectively evaluated for impairment | 519,241 | ||||
Total loans and leases | 572,062 | 519,241 | |||
Lease financing | |||||
Allowance for loan and lease losses: | |||||
Collectively evaluated for impairment | 424 | ||||
Total allowance for loan and lease losses | 851 | 424 | 411 | 432 | |
Loans and leases: | |||||
Collectively evaluated for impairment | 202,483 | ||||
Total loans and leases | 236,623 | 202,483 | |||
Residential | |||||
Allowance for loan and lease losses: | |||||
Individually evaluated for impairment | 130 | ||||
Collectively evaluated for impairment | 39,049 | ||||
Total allowance for loan and lease losses | 39,179 | ||||
Loans and leases: | |||||
Individually evaluated for impairment | 14,964 | ||||
Collectively evaluated for impairment | 4,647,211 | ||||
Total loans and leases | 4,662,175 | ||||
Consumer | |||||
Allowance for loan and lease losses: | |||||
Collectively evaluated for impairment | 34,644 | ||||
Total allowance for loan and lease losses | 56,039 | 34,644 | 35,099 | 35,813 | |
Loans and leases: | |||||
Collectively evaluated for impairment | 1,620,556 | ||||
Total loans and leases | $ 1,568,073 | 1,620,556 | |||
Unallocated | |||||
Allowance for loan and lease losses: | |||||
Collectively evaluated for impairment | 139 | ||||
Total allowance for loan and lease losses | $ 139 | $ 2,754 | $ 528 |
Allowance for Credit Losses - R
Allowance for Credit Losses - Reserve for Unfunded Commitments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | $ 770 | |
Commercial and Industrial | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | (16,105) | |
Commercial real estate | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 10,559 | |
Construction | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | (1,803) | |
Lease financing | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 207 | |
Consumer | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 15,575 | |
Reserve for unfunded commitments | ||
Reserve for unfunded commitments: | ||
Reserve for unfunded commitments, beginning balance | $ 600 | |
Adoption of ASU 2016-13 | 16,300 | |
Increase (decrease) in Provision | 351 | |
Reserve for unfunded commitments, ending balance | 17,251 | |
Reserve for unfunded commitments | Commercial and Industrial | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 5,390 | |
Increase (decrease) in Provision | (599) | |
Reserve for unfunded commitments, ending balance | 4,791 | |
Reserve for unfunded commitments | Commercial real estate | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 778 | |
Increase (decrease) in Provision | (82) | |
Reserve for unfunded commitments, ending balance | 696 | |
Reserve for unfunded commitments | Construction | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 4,119 | |
Increase (decrease) in Provision | 694 | |
Reserve for unfunded commitments, ending balance | 4,813 | |
Reserve for unfunded commitments | Residential mortgage | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 7 | |
Increase (decrease) in Provision | (6) | |
Reserve for unfunded commitments, ending balance | 1 | |
Reserve for unfunded commitments | Home equity | ||
Reserve for unfunded commitments: | ||
Adoption of ASU 2016-13 | 6,587 | |
Increase (decrease) in Provision | 340 | |
Reserve for unfunded commitments, ending balance | 6,927 | |
Reserve for unfunded commitments | Consumer | ||
Reserve for unfunded commitments: | ||
Reserve for unfunded commitments, beginning balance | 600 | |
Adoption of ASU 2016-13 | $ (581) | |
Increase (decrease) in Provision | 4 | |
Reserve for unfunded commitments, ending balance | $ 23 |
Allowance for Credit Losses -_2
Allowance for Credit Losses - Amortized Cost Basis by Year of Origination and Credit Quality Indicator (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Residential and consumer | |
Credit quality | |
2020 | $ 520,211 |
2019 | 2,312,205 |
2018 | 1,969,068 |
2017 | 1,533,858 |
2016 | 1,036,924 |
Prior | 2,827,658 |
Revolving Loans Amortized Cost Basis | 3,116,593 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 63,753 |
Total | 13,380,270 |
Residential | |
Credit quality | |
2020 | 185,155 |
2019 | 559,632 |
2018 | 518,792 |
2017 | 577,924 |
2016 | 465,819 |
Prior | 1,365,048 |
Revolving Loans Amortized Cost Basis | 892,278 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 505 |
Total | 4,565,153 |
Consumer | |
Credit quality | |
2020 | 92,841 |
2019 | 392,843 |
2018 | 315,807 |
2017 | 206,199 |
2016 | 107,376 |
Prior | 55,828 |
Revolving Loans Amortized Cost Basis | 397,179 |
Total | 1,568,073 |
Consumer | 740 and greater | |
Credit quality | |
2020 | 46,781 |
2019 | 150,459 |
2018 | 128,010 |
2017 | 76,608 |
2016 | 41,303 |
Prior | 17,034 |
Revolving Loans Amortized Cost Basis | 117,149 |
Total | 577,344 |
Consumer | 680 - 739 | |
Credit quality | |
2020 | 29,047 |
2019 | 124,783 |
2018 | 99,908 |
2017 | 59,075 |
2016 | 29,503 |
Prior | 13,332 |
Revolving Loans Amortized Cost Basis | 92,315 |
Total | 447,963 |
Consumer | 620 - 679 | |
Credit quality | |
2020 | 11,357 |
2019 | 73,221 |
2018 | 51,785 |
2017 | 35,102 |
2016 | 18,932 |
Prior | 9,072 |
Revolving Loans Amortized Cost Basis | 49,123 |
Total | 248,592 |
Consumer | 550 - 619 | |
Credit quality | |
2020 | 1,679 |
2019 | 21,334 |
2018 | 23,130 |
2017 | 20,105 |
2016 | 10,676 |
Prior | 6,105 |
Revolving Loans Amortized Cost Basis | 18,624 |
Total | 101,653 |
Consumer | Less than 550 | |
Credit quality | |
2020 | 581 |
2019 | 7,625 |
2018 | 12,696 |
2017 | 12,928 |
2016 | 6,832 |
Prior | 3,459 |
Revolving Loans Amortized Cost Basis | 7,906 |
Total | 52,027 |
Consumer | No Score | |
Credit quality | |
2020 | 2,796 |
2019 | 6,248 |
2018 | 174 |
2017 | 151 |
2016 | 30 |
Prior | 3 |
Revolving Loans Amortized Cost Basis | 37,382 |
Total | 46,784 |
Consumer | Other | |
Credit quality | |
2020 | 600 |
2019 | 9,173 |
2018 | 104 |
2017 | 2,230 |
2016 | 100 |
Prior | 6,823 |
Revolving Loans Amortized Cost Basis | 74,680 |
Total | 93,710 |
Home equity line | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 891,698 |
Total | 891,698 |
Home equity line | 740 and greater | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 629,818 |
Total | 629,818 |
Home equity line | 680 - 739 | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 173,990 |
Total | 173,990 |
Home equity line | 620 - 679 | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 58,863 |
Total | 58,863 |
Home equity line | 550 - 619 | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 16,863 |
Total | 16,863 |
Home equity line | Less than 550 | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 6,852 |
Total | 6,852 |
Home equity line | No Score | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 5,312 |
Total | 5,312 |
Commercial and Industrial | |
Credit quality | |
2020 | 104,018 |
2019 | 393,542 |
2018 | 314,725 |
2017 | 97,907 |
2016 | 77,134 |
Prior | 224,507 |
Revolving Loans Amortized Cost Basis | 1,750,266 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 63,246 |
Total | 3,025,345 |
Commercial and Industrial | Pass | |
Credit quality | |
2020 | 96,493 |
2019 | 364,221 |
2018 | 294,506 |
2017 | 86,993 |
2016 | 72,683 |
Prior | 210,731 |
Revolving Loans Amortized Cost Basis | 1,542,232 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 62,021 |
Total | 2,729,880 |
Commercial and Industrial | Special mention | |
Credit quality | |
2020 | 126 |
2019 | 3,490 |
2018 | 2,757 |
2017 | 360 |
2016 | 535 |
Prior | 7,064 |
Revolving Loans Amortized Cost Basis | 88,787 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 256 |
Total | 103,375 |
Commercial and Industrial | Substandard | |
Credit quality | |
2020 | 160 |
2019 | 7,456 |
2018 | 3,568 |
2017 | 1,569 |
2016 | 57 |
Prior | 5,465 |
Revolving Loans Amortized Cost Basis | 50,830 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 969 |
Total | 70,074 |
Commercial and Industrial | Other | |
Credit quality | |
2020 | 7,239 |
2019 | 18,375 |
2018 | 13,894 |
2017 | 8,985 |
2016 | 3,859 |
Prior | 1,247 |
Revolving Loans Amortized Cost Basis | 68,417 |
Total | 122,016 |
Commercial real estate | |
Credit quality | |
2020 | 70,775 |
2019 | 765,094 |
2018 | 594,895 |
2017 | 521,137 |
2016 | 353,770 |
Prior | 1,056,662 |
Revolving Loans Amortized Cost Basis | 50,679 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 2 |
Total | 3,413,014 |
Commercial real estate | Pass | |
Credit quality | |
2020 | 70,775 |
2019 | 731,880 |
2018 | 577,488 |
2017 | 497,579 |
2016 | 324,782 |
Prior | 1,024,477 |
Revolving Loans Amortized Cost Basis | 47,680 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 2 |
Total | 3,274,663 |
Commercial real estate | Special mention | |
Credit quality | |
2019 | 8,810 |
2018 | 17,407 |
2017 | 23,558 |
2016 | 28,562 |
Prior | 27,346 |
Revolving Loans Amortized Cost Basis | 2,999 |
Total | 108,682 |
Commercial real estate | Substandard | |
Credit quality | |
2019 | 24,404 |
2016 | 426 |
Prior | 4,325 |
Total | 29,155 |
Commercial real estate | Other | |
Credit quality | |
Prior | 514 |
Total | 514 |
Construction | |
Credit quality | |
2020 | 17,806 |
2019 | 127,741 |
2018 | 206,767 |
2017 | 107,988 |
2016 | 26,886 |
Prior | 58,683 |
Revolving Loans Amortized Cost Basis | 26,191 |
Total | 572,062 |
Construction | Pass | |
Credit quality | |
2020 | 15,537 |
2019 | 96,333 |
2018 | 192,397 |
2017 | 99,207 |
2016 | 25,151 |
Prior | 53,105 |
Revolving Loans Amortized Cost Basis | 25,991 |
Total | 507,721 |
Construction | Special mention | |
Credit quality | |
Revolving Loans Amortized Cost Basis | 200 |
Total | 200 |
Construction | Substandard | |
Credit quality | |
2017 | 2,219 |
Prior | 1,002 |
Total | 3,221 |
Construction | Other | |
Credit quality | |
2020 | 2,269 |
2019 | 31,408 |
2018 | 14,370 |
2017 | 6,562 |
2016 | 1,735 |
Prior | 4,576 |
Total | 60,920 |
Lease financing | |
Credit quality | |
2020 | 49,616 |
2019 | 73,353 |
2018 | 18,082 |
2017 | 22,703 |
2016 | 5,939 |
Prior | 66,930 |
Total | 236,623 |
Lease financing | Pass | |
Credit quality | |
2020 | 49,616 |
2019 | 73,066 |
2018 | 17,998 |
2017 | 22,263 |
2016 | 5,939 |
Prior | 66,866 |
Total | 235,748 |
Lease financing | Special mention | |
Credit quality | |
2019 | 287 |
2018 | 84 |
2017 | 440 |
Prior | 64 |
Total | 875 |
Commercial Lending | |
Credit quality | |
2020 | 242,215 |
2019 | 1,359,730 |
2018 | 1,134,469 |
2017 | 749,735 |
2016 | 463,729 |
Prior | 1,406,782 |
Revolving Loans Amortized Cost Basis | 1,827,136 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 63,248 |
Total | 7,247,044 |
Residential mortgage | |
Credit quality | |
2020 | 185,155 |
2019 | 559,632 |
2018 | 518,792 |
2017 | 577,924 |
2016 | 465,819 |
Prior | 1,365,048 |
Revolving Loans Amortized Cost Basis | 580 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 505 |
Total | 3,673,455 |
Residential mortgage | 740 and greater | |
Credit quality | |
2020 | 134,802 |
2019 | 429,854 |
2018 | 380,979 |
2017 | 437,915 |
2016 | 376,570 |
Prior | 1,044,890 |
Total | 2,805,010 |
Residential mortgage | 680 - 739 | |
Credit quality | |
2020 | 28,248 |
2019 | 71,374 |
2018 | 69,543 |
2017 | 69,434 |
2016 | 44,492 |
Prior | 170,974 |
Total | 454,065 |
Residential mortgage | 620 - 679 | |
Credit quality | |
2020 | 3,527 |
2019 | 13,645 |
2018 | 11,235 |
2017 | 13,074 |
2016 | 11,621 |
Prior | 57,611 |
Total | 110,713 |
Residential mortgage | 550 - 619 | |
Credit quality | |
2020 | 2,012 |
2019 | 1,834 |
2018 | 3,547 |
2017 | 4,096 |
2016 | 3,050 |
Prior | 13,474 |
Total | 28,013 |
Residential mortgage | Less than 550 | |
Credit quality | |
2018 | 1,206 |
2017 | 1,912 |
2016 | 966 |
Prior | 6,363 |
Total | 10,447 |
Residential mortgage | No Score | |
Credit quality | |
2020 | 11,783 |
2019 | 21,987 |
2018 | 25,655 |
2017 | 26,042 |
2016 | 16,592 |
Prior | 54,212 |
Total | 156,271 |
Residential mortgage | Other | |
Credit quality | |
2020 | 4,783 |
2019 | 20,938 |
2018 | 26,627 |
2017 | 25,451 |
2016 | 12,528 |
Prior | 17,524 |
Revolving Loans Amortized Cost Basis | 580 |
Revolving Loans Converted to Term Loans Amortized Cost Basis | 505 |
Total | $ 108,936 |
Allowance for Credit Losses -_3
Allowance for Credit Losses - Amortized Cost Basis of Revolving Loans that Were Converted to Term Loans (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Credit quality | |
Total Revolving Loans Converted to Term Loans During the Period | $ 28,524 |
Commercial and Industrial | |
Credit quality | |
Total Revolving Loans Converted to Term Loans During the Period | 28,228 |
Residential Mortgage. | |
Credit quality | |
Total Revolving Loans Converted to Term Loans During the Period | $ 296 |
Allowance for Credit Losses - C
Allowance for Credit Losses - Credit Risk Profiles by Internally Assigned Grade (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Credit quality | ||
Loans and leases | $ 13,380,270,000 | $ 13,211,650,000 |
Loss | ||
Credit quality | ||
Loans and leases | 0 | 0 |
Commercial and Industrial | ||
Credit quality | ||
Loans and leases | 3,025,345,000 | 2,743,242,000 |
Commercial and Industrial | Loans graded | ||
Credit quality | ||
Loans and leases | 2,743,242,000 | |
Commercial and Industrial | Pass | ||
Credit quality | ||
Loans and leases | 2,585,908,000 | |
Commercial and Industrial | Special mention | ||
Credit quality | ||
Loans and leases | 91,365,000 | |
Commercial and Industrial | Substandard | ||
Credit quality | ||
Loans and leases | 65,969,000 | |
Commercial real estate | ||
Credit quality | ||
Loans and leases | 3,413,014,000 | 3,463,953,000 |
Commercial real estate | Loans graded | ||
Credit quality | ||
Loans and leases | 3,463,953,000 | |
Commercial real estate | Pass | ||
Credit quality | ||
Loans and leases | 3,327,659,000 | |
Commercial real estate | Special mention | ||
Credit quality | ||
Loans and leases | 106,331,000 | |
Commercial real estate | Substandard | ||
Credit quality | ||
Loans and leases | 29,963,000 | |
Construction | ||
Credit quality | ||
Loans and leases | 572,062,000 | 519,241,000 |
Construction | Loans graded | ||
Credit quality | ||
Loans and leases | 519,241,000 | |
Construction | Pass | ||
Credit quality | ||
Loans and leases | 515,993,000 | |
Construction | Special mention | ||
Credit quality | ||
Loans and leases | 127,000 | |
Construction | Substandard | ||
Credit quality | ||
Loans and leases | 3,121,000 | |
Lease financing | ||
Credit quality | ||
Loans and leases | $ 236,623,000 | 202,483,000 |
Lease financing | Loans graded | ||
Credit quality | ||
Loans and leases | 202,483,000 | |
Lease financing | Pass | ||
Credit quality | ||
Loans and leases | 201,461,000 | |
Lease financing | Special mention | ||
Credit quality | ||
Loans and leases | 1,022,000 | |
Commercial Lending | Loans graded | ||
Credit quality | ||
Loans and leases | 6,928,919,000 | |
Commercial Lending | Pass | ||
Credit quality | ||
Loans and leases | 6,631,021,000 | |
Commercial Lending | Special mention | ||
Credit quality | ||
Loans and leases | 198,845,000 | |
Commercial Lending | Substandard | ||
Credit quality | ||
Loans and leases | $ 99,053,000 |
Allowance for Credit Losses -_4
Allowance for Credit Losses - Credit Risk Profiles Based on Payment Activity, Not Subject to Loan Grading (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | $ 13,380,270 | $ 13,211,650 |
Residential | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 4,662,175 | |
Residential | Residential mortgage | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 3,673,455 | 3,768,936 |
Home equity Line | Home equity | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 891,698 | 893,239 |
Consumer | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 1,568,073 | 1,620,556 |
Consumer | Consumer loans | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | $ 1,568,073 | 1,620,556 |
Not subject to loan grading | Residential and consumer | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 6,282,731 | |
Not subject to loan grading | Residential and consumer | Performing | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 6,229,130 | |
Not subject to loan grading | Residential and consumer | Non-performing and delinquent | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 53,601 | |
Not subject to loan grading | Residential | Residential mortgage | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 3,768,936 | |
Not subject to loan grading | Residential | Residential mortgage | Performing | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 3,759,799 | |
Not subject to loan grading | Residential | Residential mortgage | Non-performing and delinquent | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 9,137 | |
Not subject to loan grading | Home equity Line | Home equity | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 893,239 | |
Not subject to loan grading | Home equity Line | Home equity | Performing | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 886,879 | |
Not subject to loan grading | Home equity Line | Home equity | Non-performing and delinquent | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 6,360 | |
Not subject to loan grading | Consumer | Consumer - Auto | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 1,040,468 | |
Not subject to loan grading | Consumer | Consumer - Auto | Performing | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 1,016,142 | |
Not subject to loan grading | Consumer | Consumer - Auto | Non-performing and delinquent | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 24,326 | |
Not subject to loan grading | Consumer | Credit Cards | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 353,784 | |
Not subject to loan grading | Consumer | Credit Cards | Performing | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | 347,264 | |
Not subject to loan grading | Consumer | Credit Cards | Non-performing and delinquent | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Loans and leases | $ 6,520 |
Allowance for Credit Losses -_5
Allowance for Credit Losses - Aging of Analysis of Past Due Loans and Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | $ 100,233 | $ 58,126 |
Current | 13,280,037 | 13,148,056 |
Total Accruing Loans and Leases | 13,206,182 | |
Total Non Accruing Loans and Leases | 5,468 | |
Total loans and leases | 13,380,270 | 13,211,650 |
30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 70,421 | 36,228 |
60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 13,854 | 9,748 |
Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 15,958 | 12,150 |
Total Accruing Loans and Leases | 10,913 | |
Commercial and Industrial | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 11,685 | 3,762 |
Current | 3,013,660 | 2,739,448 |
Total Accruing Loans and Leases | 2,743,210 | |
Total Non Accruing Loans and Leases | 32 | |
Total loans and leases | 3,025,345 | 2,743,242 |
Commercial and Industrial | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 6,634 | 1,525 |
Commercial and Industrial | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,010 | 808 |
Commercial and Industrial | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 4,041 | 1,429 |
Total Accruing Loans and Leases | 4,007 | |
Commercial real estate | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 17,667 | 3,802 |
Current | 3,395,347 | 3,460,121 |
Total Accruing Loans and Leases | 3,463,923 | |
Total Non Accruing Loans and Leases | 30 | |
Total loans and leases | 3,413,014 | 3,463,953 |
Commercial real estate | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 14,204 | 1,664 |
Commercial real estate | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,706 | 1,125 |
Commercial real estate | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 757 | 1,013 |
Total Accruing Loans and Leases | 757 | |
Construction | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 8,677 | 2,367 |
Current | 563,385 | 516,874 |
Total Accruing Loans and Leases | 519,241 | |
Total loans and leases | 572,062 | 519,241 |
Construction | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 6,003 | |
Construction | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 104 | |
Construction | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,570 | 2,367 |
Total Accruing Loans and Leases | 148 | |
Lease financing | ||
Financing Receivable, Recorded Investment, Past Due | ||
Current | 236,623 | 202,483 |
Total Accruing Loans and Leases | 202,483 | |
Total loans and leases | 236,623 | 202,483 |
Residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total loans and leases | 4,662,175 | |
Consumer | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total loans and leases | 1,568,073 | 1,620,556 |
Residential mortgage | Residential | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 8,576 | 3,731 |
Current | 3,664,879 | 3,759,799 |
Total Accruing Loans and Leases | 3,763,530 | |
Total Non Accruing Loans and Leases | 5,406 | |
Total loans and leases | 3,673,455 | 3,768,936 |
Residential mortgage | Residential | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3,556 | 3,258 |
Residential mortgage | Residential | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,349 | 399 |
Residential mortgage | Residential | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,671 | 74 |
Total Accruing Loans and Leases | 82 | |
Home equity | Home equity Line | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 10,975 | 6,360 |
Current | 880,723 | 886,879 |
Total Accruing Loans and Leases | 893,239 | |
Total loans and leases | 891,698 | 893,239 |
Home equity | Home equity Line | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 6,947 | 2,971 |
Home equity | Home equity Line | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 1,462 | 394 |
Home equity | Home equity Line | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 2,566 | 2,995 |
Total Accruing Loans and Leases | 2,566 | |
Consumer loans | Consumer | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 42,653 | 38,104 |
Current | 1,525,420 | 1,582,452 |
Total Accruing Loans and Leases | 1,620,556 | |
Total loans and leases | 1,568,073 | 1,620,556 |
Consumer loans | Consumer | 30 - 59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 33,077 | 26,810 |
Consumer loans | Consumer | 60 - 89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 6,223 | 7,022 |
Consumer loans | Consumer | Greater Than or Equal to 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due | ||
Total Past Due | 3,353 | $ 4,272 |
Total Accruing Loans and Leases | $ 3,353 |
Allowance for Credit Losses -_6
Allowance for Credit Losses - Amortized Cost Basis of Loans and Leases on Nonaccrual Status (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Jan. 01, 2020 | |
Financing Receivable, Nonaccrual [Line Items] | ||
Nonaccrual Loans and Leases With No Allowance for Credit Losses | $ 806,000 | |
Nonaccrual Loans and Leases | 6,926,000 | $ 5,468,000 |
Interest income on nonaccrual loans | 0 | |
Commercial and Industrial | ||
Financing Receivable, Nonaccrual [Line Items] | ||
Nonaccrual Loans and Leases | 32,000 | 32,000 |
Commercial real estate | ||
Financing Receivable, Nonaccrual [Line Items] | ||
Nonaccrual Loans and Leases | 30,000 | |
Construction | ||
Financing Receivable, Nonaccrual [Line Items] | ||
Nonaccrual Loans and Leases | 2,422,000 | |
Residential | ||
Financing Receivable, Nonaccrual [Line Items] | ||
Nonaccrual Loans and Leases With No Allowance for Credit Losses | 806,000 | |
Nonaccrual Loans and Leases | $ 4,472,000 | $ 5,406,000 |
Allowance for Credit Losses -_7
Allowance for Credit Losses - Collateral-Dependent Loans and Leases (Details) $ in Millions | Mar. 31, 2020USD ($) |
Allowance for Credit Losses | |
Amortized cost basis of collateral dependent loans | $ 35.1 |
Allowance for Credit Losses - I
Allowance for Credit Losses - Impaired Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Recorded Investment | ||
Impaired loans with no related allowance recorded | $ 14,280 | |
Impaired loans with a related allowance recorded | 6,358 | |
Total impaired loans | 20,638 | |
Unpaid Principal Balance | ||
Impaired loans with no related allowance recorded | 14,589 | |
Impaired loans with a related allowance recorded | 6,638 | |
Total impaired loans | 21,227 | |
Related Allowance, Impaired loans | 203 | |
Average Recorded Investment | ||
Impaired loans with no related allowance recorded | $ 16,186 | |
Impaired loans with a related allowance recorded | 13,857 | |
Total impaired loans | 30,043 | |
Interest Income Recognized | ||
Impaired loans with no related allowance recorded | 300 | |
Impaired loans with a related allowance recorded | 214 | |
Total impaired loans | 514 | |
Commercial and Industrial | ||
Recorded Investment | ||
Impaired loans with no related allowance recorded | 3,825 | |
Impaired loans with a related allowance recorded | 1,126 | |
Total impaired loans | 4,951 | |
Unpaid Principal Balance | ||
Impaired loans with no related allowance recorded | 3,841 | |
Impaired loans with a related allowance recorded | 1,126 | |
Total impaired loans | 4,967 | |
Related Allowance, Impaired loans | 46 | |
Average Recorded Investment | ||
Impaired loans with no related allowance recorded | 3,418 | |
Impaired loans with a related allowance recorded | 5,978 | |
Total impaired loans | 9,396 | |
Interest Income Recognized | ||
Impaired loans with no related allowance recorded | 29 | |
Impaired loans with a related allowance recorded | 108 | |
Total impaired loans | 137 | |
Commercial real estate | ||
Recorded Investment | ||
Impaired loans with no related allowance recorded | 30 | |
Impaired loans with a related allowance recorded | 693 | |
Total impaired loans | 723 | |
Unpaid Principal Balance | ||
Impaired loans with no related allowance recorded | 30 | |
Impaired loans with a related allowance recorded | 693 | |
Total impaired loans | 723 | |
Related Allowance, Impaired loans | 27 | |
Average Recorded Investment | ||
Impaired loans with no related allowance recorded | 4,102 | |
Impaired loans with a related allowance recorded | 723 | |
Total impaired loans | 4,825 | |
Interest Income Recognized | ||
Impaired loans with no related allowance recorded | 171 | |
Impaired loans with a related allowance recorded | 10 | |
Total impaired loans | 181 | |
Residential | ||
Recorded Investment | ||
Impaired loans with no related allowance recorded | 10,425 | |
Impaired loans with a related allowance recorded | 4,539 | |
Total impaired loans | 14,964 | |
Unpaid Principal Balance | ||
Impaired loans with no related allowance recorded | 10,718 | |
Impaired loans with a related allowance recorded | 4,819 | |
Total impaired loans | 15,537 | |
Related Allowance, Impaired loans | $ 130 | |
Average Recorded Investment | ||
Impaired loans with no related allowance recorded | 8,666 | |
Impaired loans with a related allowance recorded | 7,156 | |
Total impaired loans | 15,822 | |
Interest Income Recognized | ||
Impaired loans with no related allowance recorded | 100 | |
Impaired loans with a related allowance recorded | 96 | |
Total impaired loans | $ 196 |
Allowance for Credit Losses - T
Allowance for Credit Losses - Troubled Debt Restructuring Modifications (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020USD ($)contractloan | Mar. 31, 2019USD ($)contractloan | Dec. 31, 2019USD ($)contractloan | |
Troubled debt restructuring modifications | |||
Number of Contracts | contract | 1 | 5 | |
Recorded Investment | $ 500 | $ 1,268 | |
Related Allowance | 30 | $ 38 | |
Aggregate commitments to extend credit, standby letters of credit and commercial letters of credit | 5,900,000 | $ 6,100,000 | |
Commitments related to borrowers who had loan terms modified in a TDR | 2,000 | 4,500 | |
Loans modified in TDRs that experienced a payment default | |||
Current | 13,280,037 | 13,148,056 | |
Total loans and leases | $ 13,380,270 | 13,211,650 | |
Number of loans modified in TDRs that have defaulted in the current period | loan | 0 | 0 | |
Commercial and Industrial | |||
Troubled debt restructuring modifications | |||
Number of Contracts | contract | 1 | 4 | |
Recorded Investment | $ 500 | $ 916 | |
Related Allowance | 30 | $ 24 | |
Loans modified in TDRs that experienced a payment default | |||
Current | 3,013,660 | 2,739,448 | |
Total loans and leases | 3,025,345 | 2,743,242 | |
Commercial real estate | |||
Loans modified in TDRs that experienced a payment default | |||
Current | 3,395,347 | 3,460,121 | |
Total loans and leases | 3,413,014 | 3,463,953 | |
Lease financing | |||
Loans modified in TDRs that experienced a payment default | |||
Current | 236,623 | 202,483 | |
Total loans and leases | $ 236,623 | 202,483 | |
Residential | |||
Troubled debt restructuring modifications | |||
Period of time monthly payments are lowered to accommodate borrowers' financial needs | 2 years | ||
Number of Contracts | contract | 1 | ||
Recorded Investment | $ 352 | ||
Related Allowance | $ 14 | ||
Loans modified in TDRs that experienced a payment default | |||
Total loans and leases | $ 4,662,175 | ||
Residential | Real estate property held from foreclosed TDR | |||
Loans modified in TDRs that experienced a payment default | |||
Number of real estate properties | loan | 1 | 2 | |
Real estate property held from a foreclosed TDR | $ 200 | $ 300 | |
Consumer | |||
Loans modified in TDRs that experienced a payment default | |||
Total loans and leases | $ 1,568,073 | 1,620,556 | |
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 | ||
Construction | |||
Loans modified in TDRs that experienced a payment default | |||
Current | $ 563,385 | 516,874 | |
Total loans and leases | $ 572,062 | $ 519,241 | |
Residential Mortgage. | |||
Loans modified in TDRs that experienced a payment default | |||
Number of residential mortgage loans collateralized by real estate property and modified in a TDR in the process of foreclosure | contract | 1 | 1 | |
Residential mortgage loans collateralized by real estate property and modified in a TDR in the process of foreclosure | $ 300 | $ 300 | |
Commitments to extend credit | |||
Troubled debt restructuring modifications | |||
Aggregate commitments to extend credit, standby letters of credit and commercial letters of credit | 5,727,850 | 5,907,690 | |
Standby letters of credit | |||
Troubled debt restructuring modifications | |||
Aggregate commitments to extend credit, standby letters of credit and commercial letters of credit | 185,315 | 181,412 | |
Commercial Letters of credit | |||
Troubled debt restructuring modifications | |||
Aggregate commitments to extend credit, standby letters of credit and commercial letters of credit | $ 8,850 | $ 7,334 |
Mortgage Servicing Rights - Loa
Mortgage Servicing Rights - Loans, Fees, Amortization and Carrying Value (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Other Intangible Assets | |||
Unpaid principal amount of consumer loans serviced for others | $ 2,400,000 | $ 2,300,000 | |
Contractually specified fees, late charges, and ancillary fees | 1,500 | $ 1,600 | |
Amortization of mortgage servicing rights | 1,980 | 764 | |
MSRs | |||
Other Intangible Assets | |||
Amortization of mortgage servicing rights | 2,000 | $ 800 | |
Estimated future amortization expenses for MSRs, next five years | |||
Under one year | 2,535 | ||
2021 | 2,047 | ||
2022 | 1,651 | ||
2023 | 1,341 | ||
2024 | 1,101 | ||
Details of MSRs | |||
Gross carrying amount | 64,771 | 63,480 | |
Less: accumulated amortization | 52,792 | 50,812 | |
Net carrying value | $ 11,979 | $ 12,668 |
Mortgage Servicing Rights - Cha
Mortgage Servicing Rights - Changes in Amortized MSRs (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in amortized mortgage servicing rights | ||||
Balance at beginning of period | $ 12,668 | $ 16,155 | ||
Originations | 1,291 | 8 | ||
Amortization | (1,980) | (764) | ||
Balance at end of period | 11,979 | 15,399 | ||
Fair value of amortized MSRs at end of period | 17,615 | 26,383 | $ 20,329 | $ 27,662 |
Impairment of MSRs recorded | $ 0 | $ 0 |
Mortgage Servicing Rights - Qua
Mortgage Servicing Rights - Quantitative Assumptions Used for MSRs (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Minimum | ||
Quantitative assumptions used in determining lower of cost or fair value of MSRs | ||
Conditional prepayment rate (as a percent) | 14.17% | 10.74% |
Life in years (of the MSR) | 1 year 11 months 4 days | 2 years 14 days |
Weighted-average coupon rate (as a percent) | 3.93% | 3.96% |
Discount rate (as a percent) | 10.00% | 10.00% |
Maximum | ||
Quantitative assumptions used in determining lower of cost or fair value of MSRs | ||
Conditional prepayment rate (as a percent) | 24.82% | 23.39% |
Life in years (of the MSR) | 5 years 3 months 3 days | 6 years 3 months 29 days |
Weighted-average coupon rate (as a percent) | 7.22% | 7.26% |
Discount rate (as a percent) | 10.00% | 10.01% |
Weighted Average | ||
Quantitative assumptions used in determining lower of cost or fair value of MSRs | ||
Conditional prepayment rate (as a percent) | 14.45% | 11.10% |
Life in years (of the MSR) | 5 years | 5 years 11 months 26 days |
Weighted-average coupon rate (as a percent) | 3.99% | 4.01% |
Discount rate (as a percent) | 10.00% | 10.00% |
Transfers of Financial Assets -
Transfers of Financial Assets - Carrying Amounts of Assets Pledged as Collateral, Borrowings and Other Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Carrying amounts of the assets pledged as collateral | ||
Public deposits | $ 1,997,472 | $ 1,543,492 |
Federal Home Loan Bank | 3,008,321 | 2,928,581 |
Federal Reserve Bank | 1,250,553 | 953,169 |
ACH transactions | 152,967 | 155,360 |
Interest rate swaps | 55,831 | 43,296 |
Total | 6,465,144 | 5,623,898 |
Securities for reverse repurchase agreements | 0 | 0 |
Extinguishment of debt | ||
In-substance debt defeasance | $ 0 | $ 0 |
Deposits - Interest-bearing or
Deposits - Interest-bearing or Noninterest-bearing (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
U.S.: | ||
Interest-bearing | $ 10,539,824 | $ 9,782,957 |
Noninterest-bearing | 5,073,463 | 5,188,696 |
Foreign: | ||
Interest-bearing | 734,639 | 781,965 |
Noninterest-bearing | 672,076 | 691,376 |
Total deposits | $ 17,020,002 | $ 16,444,994 |
Deposits - Maturity Distributio
Deposits - Maturity Distribution of Time Certificates of Deposits (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Maturity distribution of time certificates of deposit | |
Three months or less | $ 738,736 |
Over three through six months | 721,323 |
Over six through twelve months | 936,590 |
2021 | 196,352 |
2022 | 181,599 |
2023 | 89,893 |
2024 | 47,692 |
Thereafter | 113 |
Total | 2,912,298 |
Under $250,000 | |
Maturity distribution of time certificates of deposit | |
Three months or less | 248,179 |
Over three through six months | 151,083 |
Over six through twelve months | 385,105 |
2021 | 112,964 |
2022 | 121,995 |
2023 | 77,139 |
2024 | 41,639 |
Thereafter | 113 |
Total | 1,138,217 |
$250,000 or More | |
Maturity distribution of time certificates of deposit | |
Three months or less | 490,557 |
Over three through six months | 570,240 |
Over six through twelve months | 551,485 |
2021 | 83,388 |
2022 | 59,604 |
2023 | 12,754 |
2024 | 6,053 |
Total | $ 1,774,081 |
Deposits - Time Certificate Den
Deposits - Time Certificate Denominations and Overdrawn Accounts (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Deposits | ||
Time certificates of deposit in denominations of $250,000 or more, in the aggregate | $ 1,800 | $ 1,400 |
Overdrawn deposit accounts classified as loans | $ 2.3 | $ 3.6 |
Short-Term Borrowings - Compone
Short-Term Borrowings - Components and Selected Information (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Short-term borrowings | ||
Short-term borrowings | $ 400,000 | $ 400,000 |
Short-term FHLB fixed-rate advance: | ||
Short-term borrowings | ||
Short-term borrowings | $ 400,000 | $ 400,000 |
Annual interest rate | 2.84% | 2.84% |
Long-Term Borrowings - Componen
Long-Term Borrowings - Components (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Long-term borrowings | ||
Finance lease liabilities | $ 19 | $ 19 |
Long-term borrowings | $ 200,019 | $ 200,019 |
Finance lease obligation, annual interest rate | 6.78% | 6.78% |
Short-term FHLB fixed-rate advance: | ||
Long-term borrowings | ||
Long-term borrowings | $ 200,000 | $ 200,000 |
Remaining borrowing capacity | $ 1,800,000 | $ 1,700,000 |
Weighted average interest rate | 2.73% | 2.73% |
Long-Term Borrowings - Future C
Long-Term Borrowings - Future Contractual Principal Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Future contractual principal payments and maturities on long term borrowings | ||
2020 | $ 9 | |
2021 | 10 | |
2023 | 100,000 | |
2024 | 100,000 | |
Total | 200,019 | $ 200,019 |
Short-term FHLB fixed-rate advance: | ||
Future contractual principal payments and maturities on long term borrowings | ||
Total | $ 200,000 | $ 200,000 |
Short-term FHLB fixed-rate advance: | December 4, 2020 | ||
Future contractual principal payments and maturities on long term borrowings | ||
Interest rate (as a percent) | 2.80% | |
Short-term FHLB fixed-rate advance: | January 15, 2021 | ||
Future contractual principal payments and maturities on long term borrowings | ||
Interest rate (as a percent) | 2.65% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Changes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Pre-tax Amount | ||
Other comprehensive income | $ 49,079 | $ 73,136 |
Income Tax Benefit (Expense) | ||
Other comprehensive income | (13,201) | (19,695) |
Net of tax | ||
Balance, beginning | 2,640,258 | 2,524,839 |
Other comprehensive income | 35,878 | 53,441 |
Balance, ending | 2,664,685 | 2,613,202 |
Accumulated other comprehensive Income (loss) | ||
Pre-tax Amount | ||
Balance | (43,450) | (180,915) |
Balance | 5,629 | (107,779) |
Income Tax Benefit (Expense) | ||
Balance | 11,701 | 48,720 |
Balance | (1,500) | 29,025 |
Net of tax | ||
Balance, beginning | (31,749) | (132,195) |
Other comprehensive income | 35,878 | 53,441 |
Balance, ending | 4,129 | (78,754) |
Pension and other benefits, change in Company tax rate | ||
Income Tax Benefit (Expense) | ||
Other comprehensive income | (96) | |
Net of tax | ||
Other comprehensive income | (96) | |
Pension and other benefits, net change in pension and other benefits | ||
Income Tax Benefit (Expense) | ||
Other comprehensive income | (96) | |
Net of tax | ||
Balance, beginning | (28,082) | (28,379) |
Other comprehensive income | (96) | |
Balance, ending | (28,178) | (28,379) |
Investment securities: | ||
Pre-tax Amount | ||
Unrealized net gains arising during the year | 49,164 | 70,523 |
Reclassification of net losses (gains) to net income | (85) | 2,613 |
Other comprehensive income | 49,079 | 73,136 |
Income Tax Benefit (Expense) | ||
Unrealized net gains arising during the year | (13,128) | (18,991) |
Reclassification of net losses (gains) to net income | (23) | (704) |
Other comprehensive income | (13,105) | (19,695) |
Net of tax | ||
Balance, beginning | (3,667) | (103,816) |
Unrealized net gains arising during the year | 36,036 | 51,532 |
Reclassification of net losses (gains) to net income | (62) | 1,909 |
Other comprehensive income | 35,974 | 53,441 |
Balance, ending | $ 32,307 | $ (50,375) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Changes, Net of Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Net of tax | ||
Balance, beginning | $ 2,640,258 | $ 2,524,839 |
Net income | 38,865 | 69,924 |
Other comprehensive income (loss) | 35,878 | 53,441 |
Balance, ending | 2,664,685 | 2,613,202 |
Accumulated other comprehensive Income (loss) | ||
Net of tax | ||
Balance, beginning | (31,749) | (132,195) |
Other comprehensive income (loss) | 35,878 | 53,441 |
Balance, ending | 4,129 | (78,754) |
Pension and other benefits, net change in pension and other benefits | ||
Net of tax | ||
Balance, beginning | (28,082) | (28,379) |
Other comprehensive income (loss) | (96) | |
Balance, ending | (28,178) | (28,379) |
Investment securities: | ||
Net of tax | ||
Balance, beginning | (3,667) | (103,816) |
Other comprehensive income (loss) | 35,974 | 53,441 |
Balance, ending | 32,307 | (50,375) |
Reclassification of net losses (gains) to net income | $ (85) | $ 2,613 |
Regulatory Capital Requiremen_3
Regulatory Capital Requirements (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Common equity tier 1 capital to risk-weighted assets | ||
Amount | $ 1,665,064 | $ 1,676,515 |
Ratio (as a percent) | 11.65% | 11.88% |
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 | ||
Amount | $ 1,665,064 | $ 1,676,515 |
Ratio (as a percent) | 11.65% | 11.88% |
Minimum Capital Ratio (as a percent) | 6.00% | 6.00% |
Well-Capitalized Ratio (percent) | 8.00% | 8.00% |
Total capital to risk-weighted assets | ||
Amount | $ 1,843,775 | $ 1,807,645 |
Ratio (as a percent) | 12.90% | 12.81% |
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) | ||
Amount | $ 1,665,064 | $ 1,676,515 |
Ratio | 8.63% | 8.79% |
Minimum Capital Ratio (as a percent) | 4.00% | 4.00% |
Well-Capitalized Ratio (percent) | 5.00% | 5.00% |
First Hawaiian Bank (FHB) | ||
Common equity tier 1 capital to risk-weighted assets | ||
Amount | $ 1,645,403 | $ 1,654,304 |
Ratio (as a percent) | 11.51% | 11.72% |
Tier 1 capital to risk-weighted assets | ||
Amount | $ 1,645,403 | $ 1,654,304 |
Ratio (as a percent) | 11.51% | 11.72% |
Total capital to risk-weighted assets | ||
Amount | $ 1,824,118 | $ 1,785,434 |
Ratio (as a percent) | 12.76% | 12.65% |
Tier 1 capital to average assets (leverage ratio) | ||
Amount | $ 1,645,403 | $ 1,654,304 |
Ratio | 8.52% | 8.67% |
Regulatory Capital Requiremen_4
Regulatory Capital Requirements - Capital Conservation Buffer (Details) | Mar. 31, 2020 | Dec. 31, 2019 |
Regulatory Capital Requirements | ||
Effective CET1 capital to risk-weighted assets (as a percent) | 4.50% | 4.50% |
Effective Tier 1 capital to risk-weighted assets (as a percent) | 11.65% | 11.88% |
Effective total capital to risk-weighted assets (as a percent) | 12.90% | 12.81% |
Derivative Financial Instrume_3
Derivative Financial Instruments - Notional Amounts and Fair Values (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Derivatives designated as hedging instruments | Interest rate swaps | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | $ 23,190 | $ 23,190 |
Derivatives designated as hedging instruments | Interest rate swaps | Included in other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | (1,635) | (682) |
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 2,901,085 | 2,818,803 |
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Included in other assets | ||
Notional amounts and fair values of derivatives | ||
Asset Derivatives | 158,711 | 63,527 |
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 85,645 | 82,900 |
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | Included in other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | (3,199) | (4,233) |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Notional amounts and fair values of derivatives | ||
Notional Amount | 1,834 | 1,428 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Included in other assets | ||
Notional amounts and fair values of derivatives | ||
Asset Derivatives | $ 12 | |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Included in other liabilities | ||
Notional amounts and fair values of derivatives | ||
Liability Derivatives | $ (52) |
Derivative Financial Instrume_4
Derivative Financial Instruments - Clearinghouse Margin and Collateral (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Derivative contracts | ||
Initial margin collateral posted | $ 12.7 | $ 8.7 |
Interest rate swaps | ||
Derivative contracts | ||
Financial instruments pledged as collateral | 30.9 | 29.9 |
Cash pledged as collateral | 24.9 | 13.4 |
Chicago Mercantile Exchange (CME) | ||
Derivative contracts | ||
Variation margin | $ 158.7 | $ 63.5 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Fair Value Hedges (Details) $ in Thousands | Mar. 31, 2020USD ($)derivative | Dec. 31, 2019USD ($)instrument |
Fair value hedges | ||
Fair hedges carried | ||
Fixed interest rate (as a percent) | 2.90% | |
Derivatives designated as hedging instruments | Interest rate swaps | ||
Fair hedges carried | ||
Notional amounts | $ 23,190 | $ 23,190 |
Derivatives designated as hedging instruments | Interest rate swaps | Fair value hedges | ||
Fair hedges carried | ||
Number of derivatives carried | 1 | 1 |
Notional amounts | $ 23,200 | $ 23,200 |
Negative fair value | $ 1,600 | $ 700 |
Derivative Financial Instrume_6
Derivative Financial Instruments - Net Gains and Losses Recognized in Income, Fair Value Hedges (Details) - Loans and lease financing - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Gains and losses related to derivatives | ||
Recognized on hedged item | $ 906 | $ 262 |
Interest rate swaps | ||
Gains and losses related to derivatives | ||
Recognized on interest rate swap | $ (955) | $ (342) |
Derivative Financial Instrume_7
Derivative Financial Instruments - Amounts Recorded in Balance Sheets Related to Cumulative Basis Adjustments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Derivative Financial Instruments | ||
Hedged Asset Carrying Amount | $ 25,146 | $ 24,415 |
Hedged Asset, Fair Value Hedge, Cumulative Increase (Decrease) | $ 1,923 | $ 1,017 |
Derivative Financial Instrume_8
Derivative Financial Instruments - Cash Flow Hedges (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Derivatives designated as hedging instruments | Interest rate swaps | ||
Cash flow hedges | ||
Notional amounts | $ 23,190 | $ 23,190 |
Derivative Financial Instrume_9
Derivative Financial Instruments - Derivatives Not Designated as Hedges (Details) - Derivatives Not Designated as Hedging Instruments - Other noninterest income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Interest rate swaps | ||
Impact on pretax earnings of derivatives not designated as hedges | ||
Net Gains (Losses) on Derivatives | $ 16 | |
Funding Swap (Visa Derivative) | ||
Impact on pretax earnings of derivatives not designated as hedges | ||
Net Gains (Losses) on Derivatives | $ 6 | $ 5 |
Foreign exchange contracts | ||
Impact on pretax earnings of derivatives not designated as hedges | ||
Net Gains (Losses) on Derivatives | $ (52) |
Derivative Financial Instrum_10
Derivative Financial Instruments - Free-Standing (Details) | 3 Months Ended | 12 Months Ended | ||||||||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2016shares | Dec. 31, 2019USD ($) | Oct. 31, 2019USD ($) | Sep. 27, 2019 | Jun. 30, 2019 | Jul. 31, 2018USD ($) | Jun. 28, 2018 | Dec. 31, 2017 | |
Minimum | ||||||||||
Derivative financial instruments | ||||||||||
Derivative, Floating rate | 0.99% | |||||||||
Maximum | ||||||||||
Derivative financial instruments | ||||||||||
Derivative, Floating rate | 7.83% | |||||||||
Visa | Class B restricted shares | ||||||||||
Derivative financial instruments | ||||||||||
Estimated liability that was subsequently paid to the buyer | $ 300,000 | |||||||||
Number of shares sold | shares | 274,000 | |||||||||
Funding Swap (Visa Derivative) | ||||||||||
Derivative financial instruments | ||||||||||
Derivative liability value | $ 3,200,000 | $ 4,200,000 | ||||||||
Funding Swap (Visa Derivative) | Class B restricted shares | ||||||||||
Derivative financial instruments | ||||||||||
Conversion rate | 1.6228 | 1.6298 | 1.6298 | 1.6483 | ||||||
Funding Swap (Visa Derivative) | Visa | ||||||||||
Derivative financial instruments | ||||||||||
Estimated liability that was subsequently paid to the buyer | $ 300,000 | $ 700,000 | ||||||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | ||||||||||
Derivative financial instruments | ||||||||||
Notional Amount | 2,901,085,000 | $ 2,818,803,000 | ||||||||
Net interest expense on derivative | $ 0 | $ 0 | ||||||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Minimum | ||||||||||
Derivative financial instruments | ||||||||||
Fixed interest rate (as a percent) | 2.02% | 1.71% | ||||||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Maximum | ||||||||||
Derivative financial instruments | ||||||||||
Fixed interest rate (as a percent) | 8.73% | 8.73% | ||||||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Customer swap program | ||||||||||
Derivative financial instruments | ||||||||||
Notional Amount | $ 2,900,000,000 | |||||||||
Positive fair value, derivative asset | 158,700,000 | $ 63,500,000 | ||||||||
Negative fair value, derivative liability | 0 | 0 | ||||||||
Upfront fees on the dealer swap | 1,900,000 | $ 800,000 | ||||||||
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Included in other assets | ||||||||||
Derivative financial instruments | ||||||||||
Positive fair value, derivative asset | 158,711,000 | 63,527,000 | ||||||||
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | ||||||||||
Derivative financial instruments | ||||||||||
Notional Amount | 85,645,000 | 82,900,000 | ||||||||
Derivatives Not Designated as Hedging Instruments | Funding Swap (Visa Derivative) | Included in other liabilities | ||||||||||
Derivative financial instruments | ||||||||||
Negative fair value, derivative liability | $ 3,199,000 | $ 4,233,000 |
Derivative Financial Instrum_11
Derivative Financial Instruments - Counterparty Credit Risk and Credit-Risk Related Contingent Features (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Derivative contracts | |||
Counterparty credit risk adjustments | $ 0.1 | $ 0.1 | |
Credit-risk-related contingent features | |||
Aggregate fair value of derivative instruments in a net liability position | 12.3 | $ 4 | |
Collateral posted for derivatives in a net liability position | 12.2 | $ 4.7 | |
Interest rate swaps | |||
Derivative contracts | |||
Collateral thresholds for derivative agreements with credit risk related contingent features | $ 0.5 |
Commitments and Contingent Li_3
Commitments and Contingent Liabilities - Commitments to Extend Credit, Participations Sold (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Commitments to extend credit | ||
Commitments | ||
Participations sold to other institutions | $ 96.8 | $ 94.1 |
Standby letters of credit | ||
Commitments | ||
Participations sold to other institutions | $ 11.5 | $ 9 |
Commitments and Contingent Li_4
Commitments and Contingent Liabilities - Financial Instruments with Off-Balance Sheet Risk (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Financial instruments with off-balance sheet risk | ||
Contract amount | $ 5,900,000 | $ 6,100,000 |
Commitments to extend credit | ||
Financial instruments with off-balance sheet risk | ||
Contract amount | 5,727,850 | 5,907,690 |
Standby letters of credit | ||
Financial instruments with off-balance sheet risk | ||
Contract amount | 185,315 | 181,412 |
Commercial Letters of credit | ||
Financial instruments with off-balance sheet risk | ||
Contract amount | $ 8,850 | $ 7,334 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue from Contracts with Customers | ||
Net interest income | $ 138,683 | $ 145,089 |
Not in scope of Topic 606 | 8,907 | 784 |
Total noninterest income | 49,228 | 47,072 |
Total revenue | 187,911 | 192,161 |
Retail Banking | ||
Revenue from Contracts with Customers | ||
Net interest income | 89,883 | 107,227 |
Not in scope of Topic 606 | 3,637 | 2,469 |
Total noninterest income | 26,376 | 23,869 |
Total revenue | 116,259 | 131,096 |
Commercial Banking | ||
Revenue from Contracts with Customers | ||
Net interest income | 34,414 | 34,656 |
Not in scope of Topic 606 | 3,028 | (3,507) |
Total noninterest income | 17,796 | 18,388 |
Total revenue | 52,210 | 53,044 |
Treasury and Other | ||
Revenue from Contracts with Customers | ||
Net interest income | 14,386 | 3,206 |
Not in scope of Topic 606 | 2,242 | 1,822 |
Total noninterest income | 5,056 | 4,815 |
Total revenue | 19,442 | 8,021 |
Service charges on deposit accounts. | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 8,950 | 8,060 |
Service charges on deposit accounts. | Retail Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 8,088 | 7,234 |
Service charges on deposit accounts. | Commercial Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 351 | 310 |
Service charges on deposit accounts. | Treasury and Other | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 511 | 516 |
Credit and debit card fees. | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 14,486 | 21,434 |
Credit and debit card fees. | Commercial Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 12,887 | 19,707 |
Credit and debit card fees. | Treasury and Other | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 1,599 | 1,727 |
Other service charges and fees. | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 5,815 | 6,244 |
Other service charges and fees. | Retail Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 4,875 | 5,333 |
Other service charges and fees. | Commercial Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 424 | 369 |
Other service charges and fees. | Treasury and Other | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 516 | 542 |
Trust and investment services income. | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 9,591 | 8,618 |
Trust and investment services income. | Retail Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 9,591 | 8,618 |
Other. | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 1,479 | 1,932 |
Other. | Retail Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 185 | 215 |
Other. | Commercial Banking | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | 1,106 | 1,509 |
Other. | Treasury and Other | ||
Revenue from Contracts with Customers | ||
Revenue by type of service | $ 188 | $ 208 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Contract Balances (Details) | 3 Months Ended | ||
Mar. 31, 2020USD ($)item | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
Revenue from Contracts with Customers | |||
Signing bonuses received from vendors | item | 2 | ||
Contract liabilities | $ 1,600,000 | $ 1,800,000 | |
Decrease in recognized revenues and contract liabilities | 200,000 | $ 200,000 | |
Change in contract liabilities due to changes in transaction price estimates | 0 | $ 0 | |
Receivables from contracts with customers or contract assets | $ 0 | $ 0 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Other (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Revenue from Contracts with Customers | ||
Significant performance obligations | $ 0 | $ 0 |
Material contract acquisition costs | $ 0 | $ 0 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings per Share | ||
Adjustments to net income (in dollars) | $ 0 | $ 0 |
Antidilutive securities (in shares) | 0 | 0 |
Numerator: | ||
Net income | $ 38,865 | $ 69,924 |
Denominator: | ||
Basic: weighted-average shares outstanding (in shares) | 129,895,706 | 134,879,336 |
Add: weighted-average equity-based awards (in shares) | 455,879 | 319,009 |
Diluted: weighted-average shares outstanding (in shares) | 130,351,585 | 135,198,345 |
Basic earnings per share (in dollars per share) | $ 0.30 | $ 0.52 |
Diluted earnings per share (in dollars per share) | $ 0.30 | $ 0.52 |
Noninterest Income and Nonint_3
Noninterest Income and Noninterest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases | ||
Operating lease income | $ 1,500 | $ 1,500 |
Lease income related to variable lease payments | 1,500 | 1,100 |
Pension Benefits | ||
Components of net periodic benefit cost | ||
Total net periodic benefit cost | 1,856 | 2,430 |
Pension Benefits | Salaries and employee benefits | ||
Components of net periodic benefit cost | ||
Service cost | 17 | |
Pension Benefits | Other noninterest expense | ||
Components of net periodic benefit cost | ||
Interest cost | 1,621 | 2,044 |
Expected return on plan assets | (1,194) | (1,195) |
Recognized net actuarial loss (gain) | 1,429 | 1,564 |
Other Benefits | ||
Components of net periodic benefit cost | ||
Total net periodic benefit cost | 314 | 182 |
Other Benefits | Salaries and employee benefits | ||
Components of net periodic benefit cost | ||
Service cost | 189 | 159 |
Other Benefits | Other noninterest expense | ||
Components of net periodic benefit cost | ||
Interest cost | 164 | 206 |
Prior service credit | (13) | (107) |
Recognized net actuarial loss (gain) | $ (26) | $ (76) |
Fair Value - Visa Derivative (D
Fair Value - Visa Derivative (Details) - Funding Swap (Visa Derivative) $ in Thousands | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 27, 2019 | Jun. 30, 2019 | Jun. 28, 2018 | Dec. 31, 2017 |
Class B restricted shares | ||||||
Fair value | ||||||
Conversion rate | 1.6228 | 1.6298 | 1.6298 | 1.6483 | ||
Fair Value Measurements, Recurring | Level 3 | ||||||
Fair value | ||||||
Derivative Liability | $ 3,200 | $ 4,200 | ||||
Included in other liabilities | Derivatives Not Designated as Hedging Instruments | ||||||
Fair value | ||||||
Derivative Liability | $ 3,199 | $ 4,233 |
Fair Value - Assets and Liabili
Fair Value - Assets and Liabilities Recorded at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Fair value | $ 4,058,457 | $ 4,075,644 |
Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 4,058,457 | 4,075,644 |
Other assets | 158,711 | 63,539 |
Liabilities | ||
Other liabilities | (4,886) | (4,915) |
Total | ||
Net Assets (Liabilities) | 4,212,282 | 4,134,268 |
Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 4,058,457 | 4,075,644 |
Other assets | 158,711 | 63,539 |
Liabilities | ||
Other liabilities | (1,687) | (682) |
Total | ||
Net Assets (Liabilities) | 4,215,481 | 4,138,501 |
Fair Value Measurements, Recurring | Level 3 | ||
Liabilities | ||
Other liabilities | (3,199) | (4,233) |
Total | ||
Net Assets (Liabilities) | (3,199) | (4,233) |
U.S. Treasury securities | ||
Assets | ||
Fair value | 30,927 | 29,888 |
U.S. Treasury securities | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 30,927 | 29,888 |
U.S. Treasury securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 30,927 | 29,888 |
Government-sponsored enterprises debt securities | ||
Assets | ||
Fair value | 26,721 | 101,439 |
Government-sponsored enterprises debt securities | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 26,721 | 101,439 |
Government-sponsored enterprises debt securities | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 26,721 | 101,439 |
Residential - Government agency | ||
Assets | ||
Fair value | 278,963 | 291,209 |
Residential - Government agency | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 278,963 | 291,209 |
Residential - Government agency | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 278,963 | 291,209 |
Residential - Government-sponsored enterprises | ||
Assets | ||
Fair value | 417,667 | 399,492 |
Residential - Government-sponsored enterprises | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 417,667 | 399,492 |
Residential - Government-sponsored enterprises | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 417,667 | 399,492 |
Commercial - Government-sponsored enterprises | ||
Assets | ||
Fair value | 186,784 | 101,719 |
Commercial - Government-sponsored enterprises | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 186,784 | 101,719 |
Commercial - Government-sponsored enterprises | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 186,784 | 101,719 |
Government agency | ||
Assets | ||
Fair value | 2,320,878 | 2,381,278 |
Government agency | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 2,320,878 | 2,381,278 |
Government agency | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | 2,320,878 | 2,381,278 |
Government-sponsored enterprises | ||
Assets | ||
Fair value | 796,517 | 770,619 |
Government-sponsored enterprises | Fair Value Measurements, Recurring | ||
Assets | ||
Fair value | 796,517 | 770,619 |
Government-sponsored enterprises | Fair Value Measurements, Recurring | Level 2 | ||
Assets | ||
Fair value | $ 796,517 | $ 770,619 |
Fair Value - Changes in Fair Va
Fair Value - Changes in Fair Value Levels and in Level 3 Liabilities (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Fair value | ||
Amount of transfers between hierarchy levels | $ 0 | |
Visa derivative | Funding Swap (Visa Derivative) | ||
Changes in Level 3 liabilities measured at fair value on a recurring basis | ||
Balance | (4,233,000) | $ (2,607,000) |
Total net gains included in other noninterest income | 6,000 | 5,000 |
Settlements | 1,028,000 | 763,000 |
Balance | (3,199,000) | (1,839,000) |
Total net gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of March 31, | $ 6,000 | $ 5,000 |
Fair Value - Financial Instrume
Fair Value - Financial Instruments not Required to be Carried at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Lease and lease commitments excluded | ||
Financing leases | $ 236,600 | $ 202,500 |
Deposit liabilities with no defined or contractual maturity | 14,100,000 | 13,900,000 |
Capital lease obligations | 19 | 19 |
Book Value | ||
Financial assets: | ||
Cash and cash equivalents | 1,052,832 | 694,017 |
Loans held for sale | 8,180 | 904 |
Loans | 13,143,647 | 13,009,167 |
Financial liabilities: | ||
Time Deposits | 2,912,298 | 2,510,157 |
Short-term borrowings | 400,000 | 400,000 |
Long-term borrowings | 200,000 | 200,000 |
Estimated Fair Value | ||
Financial assets: | ||
Cash and cash equivalents | 1,052,832 | 694,017 |
Loans held for sale | 8,180 | 904 |
Loans | 13,452,051 | 13,140,898 |
Financial liabilities: | ||
Time Deposits | 2,922,389 | 2,501,478 |
Short-term borrowings | 401,418 | 401,709 |
Long-term borrowings | 215,788 | 207,104 |
Estimated Fair Value | Level 1 | ||
Financial assets: | ||
Cash and cash equivalents | 353,908 | 360,375 |
Estimated Fair Value | Level 2 | ||
Financial assets: | ||
Cash and cash equivalents | 698,924 | 333,642 |
Loans held for sale | 8,180 | 904 |
Financial liabilities: | ||
Time Deposits | 2,922,389 | 2,501,478 |
Short-term borrowings | 401,418 | 401,709 |
Long-term borrowings | 215,788 | 207,104 |
Estimated Fair Value | Level 3 | ||
Financial assets: | ||
Loans | $ 13,452,051 | $ 13,140,898 |
Fair Value - Unfunded Loan and
Fair Value - Unfunded Loan and Lease Commitments and Letters of Credit (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Unfunded loan and lease commitments and letters of credit | ||
Aggregate commitments to extend credit, standby letters of credit and commercial letters of credit | $ 5,900 | $ 6,100 |
Level 3 | ||
Unfunded loan and lease commitments and letters of credit | ||
Aggregate commitments to extend credit, standby letters of credit and commercial letters of credit | 5,900 | 6,100 |
Estimated fair value of unfunded loan and lease commitments and letters of credit | $ 30.8 | $ 14.4 |
Fair Value - Assets and Liabi_2
Fair Value - Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis (Details) - Collateral-dependent loans - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Assets with fair value adjustments on a nonrecurring basis | |||
Total impairment losses | $ 400,000 | $ 0 | |
Fair Value Measurements, Nonrecurring | Level 3 | |||
Assets with fair value adjustments on a nonrecurring basis | |||
Fair value | $ 1,840,000 | $ 1,502,000 |
Fair Value - Significant Unobse
Fair Value - Significant Unobservable Inputs Used in Fair Value Measurements (Details) - Level 3 - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Expected Term (in years) | Weighted Average | ||
Fair value | ||
Measurement input | 1 | 1 |
Expected Term (in years) | Minimum | ||
Fair value | ||
Measurement input | 0.5 | |
Expected Term (in years) | Maximum | ||
Fair value | ||
Measurement input | 1.5 | |
Growth Rate (percentage) | Weighted Average | ||
Fair value | ||
Measurement input | 13 | 13 |
Growth Rate (percentage) | Minimum | ||
Fair value | ||
Measurement input | 4 | |
Growth Rate (percentage) | Maximum | ||
Fair value | ||
Measurement input | 17 | |
Visa derivative | Discounted cash flow | Minimum | ||
Fair value | ||
Measurement input | 1.5977 | |
Visa derivative | Discounted cash flow | Maximum | ||
Fair value | ||
Measurement input | 1.6228 | |
Visa derivative | Expected Conversation Rate | Discounted cash flow | Weighted Average | ||
Fair value | ||
Measurement input | 1.6228 | |
Fair Value Measurements, Nonrecurring | Collateral-dependent loans | ||
Fair value | ||
Assets | $ 1,840,000 | $ 1,502,000 |
Fair Value Measurements, Nonrecurring | Collateral-dependent loans | Appraisal Value | ||
Fair value | ||
Assets | 1,840,000 | 1,502,000 |
Fair Value Measurements, Nonrecurring | Visa derivative | Discounted cash flow | ||
Fair value | ||
Liabilities | $ (3,199,000) | $ (4,233,000) |
Reportable Operating Segments -
Reportable Operating Segments - Business Segments (Details) | 3 Months Ended |
Mar. 31, 2020locationsegment | |
Reportable operating segments | |
Number of business segments | segment | 3 |
Retail Banking | |
Reportable operating segments | |
Number of Branches | location | 58 |
Reportable Operating Segments_2
Reportable Operating Segments - Selected Business Segment Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Selected business segment financial information | |||
Net interest income (expense) | $ 138,683 | $ 145,089 | |
Provision for credit losses | (41,200) | (5,680) | |
Net interest income after provision for loan and lease losses | 97,483 | 139,409 | |
Noninterest income | 49,228 | 47,072 | |
Noninterest expense | (96,466) | (92,623) | |
Income before provision for income taxes | 50,245 | 93,858 | |
(Provision) benefit for income taxes | (11,380) | (23,934) | |
Net income (loss) | 38,865 | 69,924 | |
Assets | 20,755,891 | $ 20,166,734 | |
Retail Banking | |||
Selected business segment financial information | |||
Net interest income (expense) | 89,883 | 107,227 | |
Provision for credit losses | (20,065) | (2,572) | |
Net interest income after provision for loan and lease losses | 69,818 | 104,655 | |
Noninterest income | 26,376 | 23,869 | |
Noninterest expense | (61,644) | (57,167) | |
Income before provision for income taxes | 34,550 | 71,357 | |
(Provision) benefit for income taxes | (7,523) | (18,047) | |
Net income (loss) | 27,027 | 53,310 | |
Commercial Banking | |||
Selected business segment financial information | |||
Net interest income (expense) | 34,414 | 34,656 | |
Provision for credit losses | (20,784) | (3,108) | |
Net interest income after provision for loan and lease losses | 13,630 | 31,548 | |
Noninterest income | 17,796 | 18,388 | |
Noninterest expense | (21,505) | (19,485) | |
Income before provision for income taxes | 9,921 | 30,451 | |
(Provision) benefit for income taxes | (2,645) | (7,921) | |
Net income (loss) | 7,276 | 22,530 | |
Treasury and Other | |||
Selected business segment financial information | |||
Net interest income (expense) | 14,386 | 3,206 | |
Provision for credit losses | (351) | ||
Net interest income after provision for loan and lease losses | 14,035 | 3,206 | |
Noninterest income | 5,056 | 4,815 | |
Noninterest expense | (13,317) | (15,971) | |
Income before provision for income taxes | 5,774 | (7,950) | |
(Provision) benefit for income taxes | (1,212) | 2,034 | |
Net income (loss) | $ 4,562 | $ (5,916) |