LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES (Tables)

6 Months Ended

Jun. 30, 2016

Loans and Leases Receivable Disclosure [Abstract]

Schedule of the composition of non-PCI and PCI loans

The following table presents the composition of the Company’s non-PCI and PCI loans as of June 30, 2016 and December 31, 2015:




($ in thousands)	June 30, 2016									December 31, 2015
($ in thousands)	Non-PCI Loans			PCI Loans ⁽¹⁾			Total ⁽¹⁾			Non-PCI Loans			PCI Loans ⁽¹⁾			Total ⁽¹⁾
CRE:
Income producing	$	7,364,321		$	448,412		$	7,812,733		$	6,937,199		$	541,275		$	7,478,474
Construction	522,967			—			522,967			436,776			1,895			438,671
Land	138,342			2,640			140,982			187,409			6,195			193,604
Total CRE	8,025,630			451,052			8,476,682			7,561,384			549,365			8,110,749
C&I:
Commercial business	8,402,526			46,610			8,449,136			8,155,991			57,906			8,213,897
Trade finance	714,656			12			714,668			787,800			1,310			789,110
Total C&I	9,117,182			46,622			9,163,804			8,943,791			59,216			9,003,007
Residential:
Single-family	3,027,217			158,814			3,186,031			2,877,286			189,633			3,066,919
Multifamily	1,230,358			115,911			1,346,269			1,374,718			148,277			1,522,995
Total residential	4,257,575			274,725			4,532,300			4,252,004			337,910			4,589,914
Consumer	2,041,786			21,644			2,063,430			1,931,828			24,263			1,956,091
Total loans	$	23,442,173		$	794,043		$	24,236,216		$	22,689,007		$	970,754		$	23,659,761
Unearned fees, premiums, and discounts, net	151			—			151			(16,013		)	—			(16,013		)
Allowance for loan losses	(266,511		)	(257		)	(266,768		)	(264,600		)	(359		)	(264,959		)
Loans, net	$	23,175,813		$	793,786		$	23,969,599		$	22,408,394		$	970,395		$	23,378,789


(1)	Loans net of ASC 310-30 discount.

Summary of credit risk rating for non-PCI and PCI loans by portfolio segment

The following tables present the credit risk rating for non-PCI loans by portfolio segment as of June 30, 2016 and December 31, 2015:




($ in thousands)	Pass/Watch		Special Mention		Substandard		Doubtful		Total Non-PCI Loans
June 30, 2016
CRE:
Income producing	$	7,086,172	$	51,802	$	226,347	$	—	$	7,364,321
Construction	519,345		3,622		—		—		522,967
Land	124,379		—		13,953		10		138,342
C&I:
Commercial business	7,998,058		139,189		234,391		30,888		8,402,526
Trade finance	688,080		1,600		21,271		3,705		714,656
Residential:
Single-family	3,002,316		7,035		17,866		—		3,027,217
Multifamily	1,177,818		—		52,540		—		1,230,358
Consumer	2,032,848		3,728		5,210		—		2,041,786
Total	$	22,629,016	$	206,976	$	571,578	$	34,603	$	23,442,173




($ in thousands)	Pass/Watch		Special Mention		Substandard		Doubtful		Total Non-PCI Loans
December 31, 2015
CRE:
Income producing	$	6,672,951	$	59,309	$	204,939	$	—	$	6,937,199
Construction	435,112		1,194		470		—		436,776
Land	172,189		—		15,220		—		187,409
C&I:
Commercial business	7,794,735		201,280		135,449		24,527		8,155,991
Trade finance	750,144		13,812		23,844		—		787,800
Residential:
Single-family	2,841,722		8,134		27,430		—		2,877,286
Multifamily	1,317,550		2,918		54,250		—		1,374,718
Consumer	1,926,418		883		4,527		—		1,931,828
Total	$	21,910,821	$	287,530	$	466,129	$	24,527	$	22,689,007

The following tables present the credit risk rating for PCI loans by portfolio segment as of June 30, 2016 and December 31, 2015:




($ in thousands)	Pass/Watch		Special Mention		Substandard		Total PCI Loans
June 30, 2016
CRE:
Income producing	$	363,469	$	10,866	$	74,077	$	448,412
Construction	—		—		—		—
Land	2,248		—		392		2,640
C&I:
Commercial business	37,284		4,648		4,678		46,610
Trade finance	12		—		—		12
Residential:
Single-family	155,941		1,227		1,646		158,814
Multifamily	99,886		—		16,025		115,911
Consumer	20,266		452		926		21,644
Total ⁽¹⁾	$	679,106	$	17,193	$	97,744	$	794,043




($ in thousands)	Pass/Watch		Special Mention		Substandard		Total PCI Loans
December 31, 2015
CRE:
Income producing	$	440,100	$	4,987	$	96,188	$	541,275
Construction	—		—		1,895		1,895
Land	4,285		—		1,910		6,195
C&I:
Commercial business	52,212		819		4,875		57,906
Trade finance	1,310		—		—		1,310
Residential:
Single-family	184,092		1,293		4,248		189,633
Multifamily	130,770		—		17,507		148,277
Consumer	23,121		452		690		24,263
Total ⁽¹⁾	$	835,890	$	7,551	$	127,313	$	970,754


(1)	Loans net of ASC 310-30 discount.

Schedule of aging analysis on non-PCI loans

The following tables present the aging analysis on non-PCI loans as of June 30, 2016 and December 31, 2015:




($ in thousands)	Accruing Loans 30-59 Days Past Due		Accruing Loans 60-89 Days Past Due		Total Accruing Past Due Loans		Nonaccrual Loans Less Than 90 Days Past Due		Nonaccrual Loans 90 or More Days Past Due		Total Nonaccrual Loans		Current Accruing Loans		Total Non-PCI Loans
June 30, 2016
CRE:
Income producing	$	3,557	$	2,992	$	6,549	$	17,860	$	41,390	$	59,250	$	7,298,522	$	7,364,321
Construction	—		—		—		—		—		—		522,967		522,967
Land	3,340		630		3,970		5,779		10		5,789		128,583		138,342
C&I:
Commercial business	4,455		426		4,881		54,516		19,411		73,927		8,323,718		8,402,526
Trade finance	—		—		—		4,734		3,705		8,439		706,217		714,656
Residential:
Single-family	5,038		3,264		8,302		2,378		2,739		5,117		3,013,798		3,027,217
Multifamily	4,328		337		4,665		6,474		10,845		17,319		1,208,374		1,230,358
Consumer	5,189		2,261		7,450		131		1,608		1,739		2,032,597		2,041,786
Total	$	25,907	$	9,910	$	35,817	$	91,872	$	79,708	$	171,580	$	23,234,776	$	23,442,173




($ in thousands)	Accruing Loans 30-59 Days Past Due		Accruing Loans 60-89 Days Past Due		Total Accruing Past Due Loans		Nonaccrual Loans Less Than 90 Days Past Due		Nonaccrual Loans 90 or More Days Past Due		Total Nonaccrual Loans		Current Accruing Loans		Total Non-PCI Loans
December 31, 2015
CRE:
Income producing	$	3,465	$	25,256	$	28,721	$	11,359	$	17,870	$	29,229	$	6,879,249	$	6,937,199
Construction	—		—		—		14		—		14		436,762		436,776
Land	1,124		—		1,124		277		406		683		185,602		187,409
C&I:
Commercial business	1,992		1,185		3,177		50,726		14,009		64,735		8,088,079		8,155,991
Trade finance	—		—		—		—		—		—		787,800		787,800
Residential:
Single-family	7,657		2,927		10,584		92		8,634		8,726		2,857,976		2,877,286
Multifamily	6,320		981		7,301		6,486		9,758		16,244		1,351,173		1,374,718
Consumer	2,078		209		2,287		233		1,505		1,738		1,927,803		1,931,828
Total	$	22,636	$	30,558	$	53,194	$	69,187	$	52,182	$	121,369	$	22,514,444	$	22,689,007

Summary of additions and modifications to non-PCI troubled debt restructurings

The following table presents information for loans modified as TDRs within the previous 12 months that have subsequently defaulted during the six months ended June 30, 2016 and 2015, and are still in default at period end:




	Loans Modified as TDRs that Subsequently Defaulted During the Six Months Ended June 30,
	2016			2015
($ in thousands)	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment
C&I:
Commercial business	3	$	568	—	$	—

The following tables present the additions to non-PCI TDRs for the three and six months ended June 30, 2016 and 2015:




	Loans Modified as TDRs During the Three Months Ended June 30,
($ in thousands)	2016							2015
($ in thousands)	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment ⁽¹⁾		Financial Impact ⁽²⁾		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment ⁽¹⁾		Financial Impact ⁽²⁾
CRE:
Income producing	2	$	2,152	$	2,150	$	43	—	$	—	$	—	$	—
Land	1	$	5,522	$	5,279	$	—	1	$	171	$	100	$	102
C&I:
Commercial business	1	$	75	$	75	$	12	12	$	37,924	$	38,117	$	5,465
Residential:
Single-family	1	$	795	$	795	$	—	—	$	—	$	—	$	—




	Loans Modified as TDRs During the Six Months Ended June 30,
($ in thousands)	2016							2015
($ in thousands)	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment ⁽¹⁾		Financial Impact ⁽²⁾		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment ⁽¹⁾		Financial Impact ⁽²⁾
CRE:
Income producing	3	$	15,899	$	15,802	$	43	1	$	828	$	818	$	—
Land	1	$	5,522	$	5,279	$	—	1	$	171	$	100	$	102
C&I:
Commercial business	5	$	21,689	$	15,842	$	2,618	13	$	38,090	$	38,280	$	5,497
Trade finance	2	$	7,901	$	9,256	$	—	—	$	—	$	—	$	—
Residential:
Single-family	2	$	1,071	$	1,064	$	—	1	$	281	$	281	$	2
Consumer:	1	$	344	$	338	$	1	—	$	—	$	—	$	—


(1)	Includes subsequent payments after modification and reflects the balance as of June 30, 2016 and 2015.


(2)	The financial impact includes charge-offs and specific reserves recorded at the modification date.

The following tables present the non-PCI TDR modifications for the three and six months ended June 30, 2016 and 2015 by modification type:




($ in thousands)	Modification Type
	2016								2015
	Principal ⁽¹⁾		Interest Rate Reduction		Other		Total		Principal ⁽¹⁾		Principal and Interest ⁽²⁾		Interest Deferments		Other		Total
Three Months Ended June 30,
CRE	$	6,275	$	—	$	1,154	$	7,429	$	—	$	—	$	—	$	100	$	100
C&I	75		—		—		75		13,488		18,629		6,000		—		38,117
Residential	—		795		—		795		—		—		—		—		—
Total	$	6,350	$	795	$	1,154	$	8,299	$	13,488	$	18,629	$	6,000	$	100	$	38,217




($ in thousands)	Modification Type
	2016								2015
	Principal ⁽¹⁾		Interest Rate Reduction		Other		Total		Principal⁽¹⁾		Principal and Interest ⁽²⁾		Interest Deferments		Other		Total
Six Months Ended June 30,
CRE	$	19,927	$	—	$	1,154	$	21,081	$	—	$	818	$	—	$	100	$	918
C&I	18,589		1,986		4,523		25,098		13,651		18,629		6,000		—		38,280
Residential	269		795		—		1,064		281		—		—		—		281
Consumer	338		—		—		338		—		—		—		—		—
Total	$	39,123	$	2,781	$	5,677	$	47,581	$	13,932	$	19,447	$	6,000	$	100	$	39,479


(1)	Principal modification includes forbearance payments, term extensions and principal deferments that modify the terms of the loan from principal and interest payments to interest payments only.


(2)	Principal and interest modification includes principal and interest deferments or reductions.

Summary of non-PCI impaired loans

The following tables present information on impaired non-PCI loans as of June 30, 2016 and December 31, 2015:




($ in thousands)	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
June 30, 2016
CRE:
Income producing	$	86,401	$	59,990	$	17,763	$	77,753	$	464
Land	6,910		5,279		1,114		6,393		74
C&I:
Commercial business	115,023		32,444		65,559		98,003		21,260
Trade finance	13,158		9,256		3,775		13,031		22
Residential:
Single-family	14,154		2,378		10,294		12,672		378
Multifamily	26,606		18,375		6,313		24,688		271
Consumer	1,577		—		1,577		1,577		45
Total	$	263,829	$	127,722	$	106,395	$	234,117	$	22,514




($ in thousands)	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance
December 31, 2015
CRE:
Income producing	$	47,043	$	24,347	$	15,720	$	40,067	$	3,148
Construction	66		—		14		14		1
Land	1,537		632		683		1,315		118
C&I:
Commercial business	81,720		31,045		40,111		71,156		15,993
Trade finance	10,675		—		10,675		10,675		95
Residential:
Single-family	16,486		4,401		10,611		15,012		584
Multifamily	25,634		16,944		6,783		23,727		339
Consumer	1,240		—		1,240		1,240		60
Total	$	184,401	$	77,369	$	85,837	$	163,206	$	20,338

Schedule of the average recorded investment and interest income recognized on non-PCI impaired loans

The following table presents the average recorded investment and interest income recognized on non-PCI impaired loans during the three and six months ended June 30, 2016 and 2015:




($ in thousands)	Three Months Ended June 30,								Six Months Ended June 30,
	2016				2015				2016				2015
	Average Recorded Investment		Recognized Interest Income ⁽¹⁾		Average Recorded Investment		Recognized Interest Income ⁽¹⁾		Average Recorded Investment		Recognized Interest Income ⁽¹⁾		Average Recorded Investment		Recognized Interest Income ⁽¹⁾
CRE:
Income producing	$	78,623	$	404	$	46,042	$	134	$	79,549	$	816	$	46,897	$	268
Construction	—		—		14		—		—		—		14		—
Land	6,690		8		5,876		10		6,859		17		5,951		20
C&I:
Commercial business	100,124		270		73,306		761		100,308		530		71,644		1,550
Trade finance	12,716		67		11,623		51		13,514		133		11,739		134
Residential:
Single-family	12,713		74		15,595		68		12,797		148		15,658		137
Multifamily	24,836		77		23,690		190		25,045		154		23,757		379
Consumer	1,582		16		1,256		12		1,586		31		1,258		23
Total impaired non-PCI loans	$	237,284	$	916	$	177,402	$	1,226	$	239,658	$	1,829	$	176,918	$	2,511


(1)	Includes interest recognized on accruing non-PCI TDRs. Interest payments received on nonaccrual non-PCI loans are reflected as a reduction to principal and not as interest income.

Summary of the activity in the allowance for credit losses by portfolio segment

The following tables present a summary of activities in the allowance for loan losses by portfolio segment for the three and six months ended June 30, 2016 and 2015:




($ in thousands)	Non-PCI Loans															PCI Loans			Total
($ in thousands)	CRE			C&I			Residential			Consumer			Total			PCI Loans			Total
Three Months Ended June 30, 2016
Beginning balance	$	82,538		$	134,077		$	33,935		$	9,360		$	259,910		$	328		$	260,238
(Reversal of) provision for loan losses	(4,439		)	15,347			(2,671		)	(1,017		)	7,220			(71		)	7,149
Charge-offs	(139		)	(2,214		)	—			(3		)	(2,356		)	—			(2,356		)
Recoveries	142			1,217			297			81			1,737			—			1,737
Net recoveries (charge-offs)	3			(997		)	297			78			(619		)	—			(619		)
Ending balance	$	78,102		$	148,427		$	31,561		$	8,421		$	266,511		$	257		$	266,768




($ in thousands)	Non-PCI Loans															PCI Loans			Total
($ in thousands)	CRE			C&I			Residential			Consumer			Total			PCI Loans			Total
Three Months Ended June 30, 2015
Beginning balance	$	69,740		$	133,914		$	42,990		$	10,451		$	257,095		$	643		$	257,738
Provision for (reversal of) loan losses	5,739			(2,716		)	(3,318		)	(289		)	(584		)	(31		)	(615		)
Charge-offs	(348		)	(2,843		)	(1		)	—			(3,192		)	—			(3,192		)
Recoveries	365			5,607			997			329			7,298			—			7,298
Net recoveries	17			2,764			996			329			4,106			—			4,106
Ending balance	$	75,496		$	133,962		$	40,668		$	10,491		$	260,617		$	612		$	261,229




($ in thousands)	Non-PCI Loans															PCI Loans
($ in thousands)	CRE			C&I			Residential			Consumer			Total			PCI Loans			Total
Six Months Ended June 30, 2016
Beginning balance	$	81,191		$	134,597		$	39,292		$	9,520		$	264,600		$	359		$	264,959
(Reversal of) provision for loan losses	(3,133		)	20,001			(7,988		)	(1,243		)	7,637			(102		)	7,535
Charge-offs	(195		)	(8,074		)	(137		)	(4		)	(8,410		)	—			(8,410		)
Recoveries	239			1,903			394			148			2,684			—			2,684
Net recoveries (charge-offs)	44			(6,171		)	257			144			(5,726		)	—			(5,726		)
Ending balance	$	78,102		$	148,427		$	31,561		$	8,421		$	266,511		$	257		$	266,768




($ in thousands)	Non-PCI Loans															PCI Loans			Total
($ in thousands)	CRE			C&I			Residential			Consumer			Total			PCI Loans			Total
Six Months Ended June 30, 2015
Beginning balance	$	72,263		$	134,598		$	43,856		$	10,248		$	260,965		$	714		$	261,679
Provision for (reversal of) loan losses	3,406			2,662			(4,889		)	375			1,554			(102		)	1,452
Charge-offs	(1,350		)	(9,432		)	(747		)	(463		)	(11,992		)	—			(11,992		)
Recoveries	1,177			6,134			2,448			331			10,090			—			10,090
Net (charge-offs) recoveries	(173		)	(3,298		)	1,701			(132		)	(1,902		)	—			(1,902		)
Ending balance	$	75,496		$	133,962		$	40,668		$	10,491		$	260,617		$	612		$	261,229

For further information on accounting policies and the methodology used to estimate the allowance for credit losses and loan charge-offs, please see Note 1 — Summary of Significant Accounting Policies to the Consolidated Financial Statements of the Company’s 2015 Form 10-K.

The following table presents a summary of activities in the allowance for unfunded credit reserves during the three and six months ended June 30, 2016 and 2015:




($ in thousands)	Three Months Ended June 30,					Six Months Ended June 30,
($ in thousands)	2016			2015		2016			2015
Beginning balance	$	21,414		$	15,632	$	20,360		$	12,712
(Reversal of) provision for unfunded lending commitments	(1,096		)	4,109		(42		)	7,029
Ending balance	$	20,318		$	19,741	$	20,318		$	19,741

Summary of allowance for loan losses and recorded investment by portfolio segment and impairment methodology

The following tables present the Company’s allowance for loan losses and recorded investments by portfolio segment and impairment methodology as of June 30, 2016 and December 31, 2015:




($ in thousands)	CRE		C&I		Residential		Consumer		Total
As of June 30, 2016
Allowance for loan losses
Individually evaluated for impairment	$	538	$	21,282	$	649	$	45	$	22,514
Collectively evaluated for impairment	77,564		127,145		30,912		8,376		243,997
Acquired with deteriorated credit quality	243		8		6		—		257
Ending balance	$	78,345	$	148,435	$	31,567	$	8,421	$	266,768

Recorded investment in loans
Individually evaluated for impairment	$	84,146	$	111,034	$	37,360	$	1,577	$	234,117
Collectively evaluated for impairment	7,941,484		9,006,148		4,220,215		2,040,209		23,208,056
Acquired with deteriorated credit quality ⁽¹⁾	451,052		46,622		274,725		21,644		794,043
Ending balance ⁽¹⁾	$	8,476,682	$	9,163,804	$	4,532,300	$	2,063,430	$	24,236,216




($ in thousands)	CRE		C&I		Residential		Consumer		Total
As of December 31, 2015
Allowance for loan losses
Individually evaluated for impairment	$	3,267	$	16,088	$	923	$	60	$	20,338
Collectively evaluated for impairment	77,924		118,509		38,369		9,460		244,262
Acquired with deteriorated credit quality	347		9		3		—		359
Ending balance	$	81,538	$	134,606	$	39,295	$	9,520	$	264,959

Recorded investment in loans
Individually evaluated for impairment	$	41,396	$	81,831	$	38,739	$	1,240	$	163,206
Collectively evaluated for impairment	7,519,988		8,861,960		4,213,265		1,930,588		22,525,801
Acquired with deteriorated credit quality ⁽¹⁾	549,365		59,216		337,910		24,263		970,754
Ending balance ⁽¹⁾	$	8,110,749	$	9,003,007	$	4,589,914	$	1,956,091	$	23,659,761


(1)	Loans net of ASC 310-30 discount.

Summary of changes in the accretable yield for the PCI loans

The following table presents the changes in accretable yield for PCI loans for the three and six months ended June 30, 2016 and 2015:




($ in thousands)	Three Months Ended June 30,						Six Months Ended June 30,
($ in thousands)	2016			2015			2016			2015
Beginning balance	$	185,991		$	293,155		$	214,907		$	311,688
Accretion	(16,254		)	(23,359		)	(38,683		)	(53,928		)
Changes in expected cash flows	(2,960		)	2,066			(9,447		)	14,102
Ending balance	$	166,777		$	271,862		$	166,777		$	271,862