XML 142 R27.htm IDEA: XBRL DOCUMENT
v2.4.0.6

INCOME TAXES | 12 Months Ended
--- | ---
Dec. 31, 2011
INCOME TAXES |
INCOME TAXES |
20. INCOME TAXES The provision (benefit) for income taxes consists of the following components:
|  | Year Ended December 31, |
--- | --- | --- | ---
|  | 2011 |  | 2010 |  | 2009 |
|  | (Dollars in thousands) |
Current income tax expense (benefit): |  |  |  |  |  |  |  |  |  |
Federal |  | $ | (86,157 | ) | $ | 9,942 |  | $ | (109,092 | )
State |  |  | 34,760 |  |  | 69,026 |  |  | 2,916 |
Foreign |  |  | — |  |  | — |  |  | 1,758 |
Total current income tax expense (benefit) |  |  | (51,397 | ) |  | 78,968 |  |  | (104,418 | )
Deferred income tax expense (benefit): |  |  |  |  |  |  |  |  |  |
Federal |  |  | 193,834 |  |  | 55,083 |  |  | 127,668 |
State |  |  | (7,706 | ) |  | (48,273 | ) |  | 11,571 |
Foreign |  |  | 3,369 |  |  | 5,567 |  |  | (12,107 | )
Total deferred income tax expense (benefit) |  |  | 189,497 |  |  | 12,377 |  |  | 127,132 |
Provision (benefit) for income taxes |  | $ | 138,100 |  | $ | 91,345 |  | $ | 22,714 |
The difference between the effective tax rate implicit in the consolidated financial statements and the statutory federal income tax rate can be attributed to the following:
|  | Year Ended December 31, |
--- | --- | --- | ---
|  | 2011 |  | 2010 |  | 2009 |
Federal income tax provision at statutory rate |  |  | 35.0 | % |  | 35.0 | % |  | 35.0 | %
State franchise taxes, net of federal tax effect |  |  | 4.3 |  |  | 5.3 |  |  | 8.1 |
Tax credits |  |  | (2.7 | ) |  | (4.8 | ) |  | (6.9 | )
Foreign subsidiaries acquisition |  |  | — |  |  | — |  |  | (14.4 | )
Other, net |  |  | (0.6 | ) |  | 0.2 |  |  | (0.1 | )
Effective income tax rate |  |  | 36.0 | % |  | 35.7 | % |  | 21.7 | %
The Company recognizes investment tax credits from low income housing and other investments in the year the credit arises under the flow-through method of accounting. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets (liabilities) are presented below:
|  | December 31, |
--- | --- | --- | ---
|  | 2011 |  | 2010 |
|  | Federal |  | State |  | Foreign |  | Total |  | Federal |  | State |  | Foreign |  | Total |
|  | (In thousands) |
Deferred tax liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Core deposit intangibles |  | $ | (19,449 | ) | $ | (5,537 | ) | $ | 133 |  | $ | (24,853 | ) | $ | (26,574 | ) | $ | (8,723 | ) | $ | 133 |  | $ | (35,164 | )
Affordable housing partnerships |  |  | (15,091 | ) |  | (3,904 | ) |  | — |  |  | (18,995 | ) |  | (14,889 | ) |  | (4,489 | ) |  | — |  |  | (19,378 | )
Fixed assets |  |  | (21,640 | ) |  | (6,305 | ) |  | — |  |  | (27,945 | ) |  | (27,053 | ) |  | (9,504 | ) |  | — |  |  | (36,557 | )
FHLB stock |  |  | (24,088 | ) |  | (6,874 | ) |  | — |  |  | (30,962 | ) |  | (32,191 | ) |  | (10,202 | ) |  | — |  |  | (42,393 | )
Deferred loan fees |  |  | (3,041 | ) |  | (844 | ) |  | — |  |  | (3,885 | ) |  | (3,854 | ) |  | (1,194 | ) |  | — |  |  | (5,048 | )
Purchased loan discounts |  |  | (160 | ) |  | (44 | ) |  | — |  |  | (204 | ) |  | (199 | ) |  | (61 | ) |  | — |  |  | (260 | )
State taxes |  |  | (10,749 | ) |  | — |  |  | — |  |  | (10,749 | ) |  | — |  |  | — |  |  | — |  |  | — |
Mortgage servicing assets |  |  | (2,560 | ) |  | (711 | ) |  | — |  |  | (3,271 | ) |  | (3,227 | ) |  | (999 | ) |  | — |  |  | (4,226 | )
Section 597 gain |  |  | (142,934 | ) |  | (3,588 | ) |  | — |  |  | (146,522 | ) |  | — |  |  | — |  |  | — |  |  | — |
FDIC receivable |  |  | (371,049 | ) |  | (9,314 | ) |  | — |  |  | (380,363 | ) |  | (420,752 | ) |  | 31,026 |  |  | — |  |  | (389,726 | )
Acquired debt |  |  | (10,812 | ) |  | (1,012 | ) |  | (300 | ) |  | (12,124 | ) |  | (51,070 | ) |  | (922 | ) |  | (300 | ) |  | (52,292 | )
Other, net |  |  | (4,155 | ) |  | (986 | ) |  | — |  |  | (5,141 | ) |  | (2,531 | ) |  | (454 | ) |  | (600 | ) |  | (3,585 | )
Total gross deferred tax (liabilities) |  |  | (625,728 | ) |  | (39,119 | ) |  | (167 | ) |  | (665,014 | ) |  | (582,340 | ) |  | (5,522 | ) |  | (767 | ) |  | (588,629 | )
Deferred tax assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Allowance for loan losses and REO reserves |  |  | 79,269 |  |  | 18,556 |  |  | (5,220 | ) |  | 92,605 |  |  | 84,337 |  |  | 21,896 |  |  | (5,220 | ) |  | 101,013 |
Deferred compensation |  |  | 14,533 |  |  | 4,101 |  |  | — |  |  | 18,634 |  |  | 15,407 |  |  | 4,854 |  |  | — |  |  | 20,261 |
State taxes |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,734 |  |  | — |  |  | — |  |  | 2,734 |
Purchased loan premium |  |  | 832 |  |  | 231 |  |  | — |  |  | 1,063 |  |  | 966 |  |  | 299 |  |  | — |  |  | 1,265 |
Unrealized loss on securities |  |  | 69,239 |  |  | 20,267 |  |  | — |  |  | 89,506 |  |  | 77,760 |  |  | 24,336 |  |  | — |  |  | 102,096 |
Net operating loss carryforwards |  |  | 1,052 |  |  | 34,395 |  |  | — |  |  | 35,447 |  |  | 3,057 |  |  | 34,813 |  |  | 2,041 |  |  | 39,911 |
Acquired loans and REOs |  |  | 577,883 |  |  | 30,015 |  |  | 7,957 |  |  | 615,855 |  |  | 303,045 |  |  | (7,298 | ) |  | 11,926 |  |  | 307,673 |
Other, net |  |  | 10,016 |  |  | 4,277 |  |  | 97 |  |  | 14,390 |  |  | 12,013 |  |  | 3,751 |  |  | 97 |  |  | 15,861 |
Total gross deferred tax assets |  |  | 752,824 |  |  | 111,842 |  |  | 2,834 |  |  | 867,500 |  |  | 499,319 |  |  | 82,651 |  |  | 8,844 |  |  | 590,814 |
Valuation allowance |  |  | — |  |  | (603 | ) |  | — |  |  | (603 | ) |  | — |  |  | (624 | ) |  | (2,041 | ) |  | (2,665 | )
Net deferred tax (liabilities) assets |  | $ | 127,096 |  | $ | 72,120 |  | $ | 2,667 |  | $ | 201,883 |  | $ | (83,021 | ) | $ | 76,505 |  | $ | 6,036 |  | $ | (480 | )
Management believes that it is more likely than not that all of the deferred tax assets recorded at December 31, 2011 will be realized (except to the extent of the recorded valuation allowance) because it expects to have sufficient taxable income in future years to fully realize them. A valuation allowance has been provided for the state net operating losses ("NOLs") (for states other than California, Georgia, Massachusetts and New York) since management believes that these NOLs may not be fully utilized. The valuation allowance for China loss has been fully reversed in 2011. In preparing the 2010 federal income tax return, the Bank made adjustments to the purchase price allocation to various assets related to the UCB acquisition which resulted in Section 597 gain of $666.0 million. At December 31, 2011 and 2010, the Bank had federal net operating loss carryforwards of approximately $3.0 million and $3.3 million, respectively. At December 31, 2011 and 2010, the Bank had state net operating loss carryforwards of approximately $312.3 million and $321.1 million, respectively. Of this amount, $3.0 million of the state net operating loss resulted from the acquisition of Desert Community Bank ("DCB") in 2007 and will expire in 2021. The remaining state net operating loss carryforward expires in various years through 2031. Federal and state tax laws related to a change in ownership, such as that resulting from the acquisition of DCB, place limitations on the annual amount of net operating loss carryovers that can be utilized to offset post-acquisition taxable income. Under Internal Revenue Code Section 382, which is also applicable for California tax purposes, certain changes in the ownership of a loss company can result in limitations on the utilization of net operating and any built-in losses. This annual limitation is generally based on the value of the loss company at the ownership change date. In 2010, California suspended the utilization of net operating losses for tax years 2010 and 2011 but allowed taxpayers to carryforward net operating losses for 20 years properly increased for any years in which the loss is suspended. The following table summarizes the activity related to our unrecognized tax benefits:
|  | Year Ended December 31, |
--- | --- | --- | ---
|  | 2011 |  | 2010 |
|  | (Dollars in thousands) |
Balance, beginning of year |  | $ | 4,952 |  | $ | 5,763 |
Additions for tax positions of prior years |  |  | 794 |  |  | 721 |
Reductions for tax positions of prior years |  |  | (3,208 | ) |  | (288 | )
Additions for tax positions of current year |  |  | 794 |  |  | 634 |
Settlements |  |  | — |  |  | (1,878 | )
Balance, end of year |  | $ | 3,332 |  | $ | 4,952 |
During 2011, the Company increased the unrecognized tax benefits reserve by $1.6 million for the California enterprise zone net interest deduction. The Company also reduced the unrecognized tax benefits for the California enterprise zone net interest deduction by $3.2 million due to work performed to find additional qualified enterprise zone loans from 2005 to 2008. As of December 31, 2011 and 2010, the liability for uncertain tax positions was $4.8 million and $6.2 million, respectively. Also, as of December 31, 2011 and 2010, the total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate is $2.2 million and $3.0 million, respectively. During 2011, the Company finalized the Internal Revenue Service examination for the tax years 2006 to 2009 and for Florida for the tax years ended 2006 to 2008 with no material changes. The Company is currently under examination by California for tax years ended 2003 through 2008. For federal tax purposes, tax years from 2007 and beyond remain open and for California franchise tax purposes tax years from 2003 and beyond remain open. The Company does not believe that there are any other tax jurisdictions in which the outcome of unresolved issues or claims is likely to be material to the Company's financial position, cash flows or results of operations. The Company further believes that adequate provisions have been made for all income tax uncertainties. The Company does not anticipate that the total amount of unrecognized tax benefits will significantly change during the year ending December 31, 2012. The Company recognizes interest and penalties, if applicable, related to the underpayment of income taxes as a component of income tax expense in the consolidated statement of operations. The Company accrued interest and penalties of $287 thousand, $796 thousand and $1.15 million for its unrecognized tax positions as of December 31, 2011, 2010 and 2009, respectively. Total interest and penalties accrued as of December 31, 2011 and 2010 were $1.5 million and $1.2 million, respectively.

X
- Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration