Allowance for Noncovered Loan and Lease Losses and Unfunded Commitments and Letters of Credit (Tables)

Changes in the allowance for unfunded commitments and letters of credit, a component of other liabilities in the consolidated balance sheet, are summarized as follows:



	Years Ended December 31,
	2013		2012		2011
	(in thousands)
Beginning balance	$	1,915	$	1,535	$	1,165
Net changes in the allowance for unfunded commitments and letters of credit	590		380		370
Ending balance	$	2,505	$	1,915	$	1,535

The following is an analysis of the credit quality of our covered loan portfolio as of December 31, 2013 and 2012:



	Pass		Special Mention		Substandard		Doubtful		Loss		Total
December 31, 2013	(in thousands)
Covered loans:
Commercial business:
Secured	$	48,510	$	2,849	$	18,291	$	—	$	—	$	69,650
Unsecured	2,732		396		92		—		—		3,220
Real estate:
One-to-four family residential	35,066		1,842		4,734		—		—		41,642
Commercial and multifamily residential:
Commercial land	10,778		198		7,589		—		—		18,565
Income property	55,985		3,950		10,657		—		—		70,592
Owner occupied	67,653		111		13,958		—		—		81,722
Real estate construction:
One-to-four family residential:
Land and acquisition	4,674		2,739		1,936		—		—		9,349
Residential construction	3,008		—		2,424		—		—		5,432
Commercial and multifamily residential:
Income property	3,806		—		1,709		—		—		5,515
Owner occupied	1,074		—		280		—		—		1,354
Consumer	30,722		33		3,319		27		—		34,101
Total	$	264,008	$	12,118	$	64,989	$	27	$	—	341,142
Less:
Valuation discount resulting from acquisition accounting											43,297
Allowance for loan losses											20,174
Covered loans, net											$	277,671



	Pass		Special Mention		Substandard		Doubtful		Loss		Total
December 31, 2012	(in thousands)
Covered loans:
Commercial business:
Secured	$	71,621	$	1,823	$	45,150	$	—	$	—	$	118,594
Unsecured	4,988		—		1,791		—		—		6,779
Real estate:
One-to-four family residential	44,782		1,344		11,024		—		—		57,150
Commercial and multifamily residential:
Commercial land	16,336		—		10,292		—		—		26,628
Income property	81,205		864		23,315		—		—		105,384
Owner occupied	82,222		3,318		15,554		—		—		101,094
Real estate construction:
One-to-four family residential:
Land and acquisition	4,817		3,273		5,743		—		—		13,833
Residential construction	6,050		—		5,515		—		—		11,565
Commercial and multifamily residential:
Income property	4,419		—		7,901		—		—		12,320
Owner occupied	1,107		—		1,824		—		—		2,931
Consumer	38,973		381		5,162		—		—		44,516
Total	$	356,520	$	11,003	$	133,271	$	—	$	—	500,794
Less:
Valuation discount resulting from acquisition accounting											79,401
Allowance for loan losses											30,056
Covered loans, net											$	391,337

Noncovered Loans [Member]

The following tables show a detailed analysis of the allowance for loan and lease losses for noncovered loans for the years ended December 31, 2013, 2012 and 2011:



	Beginning Balance		Charge-offs			Recoveries		Provision (Recovery)			Ending Balance		Specific Reserve		General Allocation
Year ended December 31, 2013	(in thousands)
Noncovered loans:
Commercial business:
Secured	$	27,270	$	(4,148	)	$	1,512	$	6,393		$	31,027	$	343	$	30,684
Unsecured	753		(794		)	932		(195		)	696		35		661
Real estate:
One-to-four family residential	694		(228		)	270		516			1,252		138		1,114
Commercial and multifamily residential:
Commercial land	460		(20		)	169		(120		)	489		—		489
Income property	11,033		(1,405		)	489		(883		)	9,234		26		9,208
Owner occupied	6,362		(1,118		)	375		(2,014		)	3,605		1,073		2,532
Real estate construction:
One-to-four family residential:
Land and acquisition	1,171		(32		)	2,553		(3,082		)	610		71		539
Residential construction	635		(101		)	112		176			822		—		822
Commercial and multifamily residential:
Income property	316		—			—		(31		)	285		—		285
Owner occupied	102		—			—		(44		)	58		—		58
Consumer	2,437		(2,242		)	552		1,800			2,547		4		2,543
Unallocated	1,011		—			—		644			1,655		—		1,655
Total	$	52,244	$	(10,088	)	$	6,964	$	3,160		$	52,280	$	1,690	$	50,590



	Beginning Balance		Charge-offs			Recoveries		Provision (Recovery)			Ending Balance		Specific Reserve		General Allocation
Year Ended December 31, 2012	(in thousands)
Noncovered loans:
Commercial business:
Secured	$	24,745	$	(10,029	)	$	1,354	$	11,200		$	27,270	$	113	$	27,157
Unsecured	689		(144		)	194		14			753		92		661
Real estate:
One-to-four family residential	654		(549		)	285		304			694		112		582
Commercial and multifamily residential:
Commercial land	488		(526		)	63		435			460		—		460
Income property	9,551		(4,030		)	905		4,607			11,033		1,040		9,993
Owner occupied	9,606		(918		)	631		(2,957		)	6,362		38		6,324
Real estate construction:
One-to-four family residential:
Land and acquisition	2,331		(989		)	1,059		(1,230		)	1,171		—		1,171
Residential construction	864		(617		)	429		(41		)	635		—		635
Commercial and multifamily residential:
Income property	665		(93		)	66		(322		)	316		—		316
Owner occupied	35		—			—		67			102		—		102
Consumer	2,719		(2,534		)	1,171		1,081			2,437		—		2,437
Unallocated	694		—			—		317			1,011		—		1,011
Total	$	53,041	$	(20,429	)	$	6,157	$	13,475		$	52,244	$	1,395	$	50,849



	Beginning Balance		Charge-offs			Recoveries		Provision (Recovery)			Ending Balance		Specific Reserve		General Allocation
Year ended December 31, 2011	(in thousands)
Noncovered loans:
Commercial business:
Secured	$	21,811	$	(7,270	)	$	1,154	$	9,050		$	24,745	$	954	$	23,791
Unsecured	738		(639		)	1,444		(854		)	689		97		592
Real estate:
One-to-four family residential	1,100		(717		)	80		191			654		96		558
Commercial and multifamily residential:
Commercial land	634		(660		)	12		502			488		—		488
Income property	15,210		(1,407		)	414		(4,666		)	9,551		63		9,488
Owner occupied	9,692		(1,620		)	33		1,501			9,606		185		9,421
Real estate construction:
One-to-four family residential:
Land and acquisition	3,769		(1,419		)	1,978		(1,997		)	2,331		—		2,331
Residential construction	2,292		(1,068		)	113		(473		)	864		59		805
Commercial and multifamily residential:
Income property	274		(2,213		)	—		2,604			665		—		665
Owner occupied	70		—			—		(35		)	35		—		35
Consumer	2,120		(3,918		)	351		4,166			2,719		30		2,689
Unallocated	3,283		—			—		(2,589		)	694		—		694
Total	$	60,993	$	(20,931	)	$	5,579	$	7,400		$	53,041	$	1,484	$	51,557

The following is an analysis of the credit quality of our noncovered loan portfolio as of December 31, 2013 and 2012:



	Pass		Special Mention		Substandard		Doubtful		Loss		Total
December 31, 2013	(in thousands)
Noncovered loans:
Commercial business:
Secured	$	1,372,038	$	43,309	$	68,300	$	—	$	—	$	1,483,647
Unsecured	72,226		199		179		—		—		72,604
Real estate:
One-to-four family residential	98,626		1,567		5,699		—		—		105,892
Commercial and multifamily residential:
Commercial land	137,850		—		4,984		—		—		142,834
Income property	1,108,033		5,473		32,926		—		—		1,146,432
Owner occupied	748,725		—		11,884		—		—		760,609
Real estate construction:
One-to-four family residential:
Land and acquisition	7,526		—		4,144		—		—		11,670
Residential construction	36,270		2,352		3,370		—		—		41,992
Commercial and multifamily residential:
Income property	86,206		—		315		—		—		86,521
Owner occupied	38,916		—		—		—		—		38,916
Consumer	321,348		331		6,188		467		—		328,334
Total	$	4,027,764	$	53,231	$	137,989	$	467	$	—	4,219,451
Less:
Allowance for loan losses											52,280
Noncovered loans, net											$	4,167,171



	Pass		Special Mention		Substandard		Doubtful		Loss		Total
December 31, 2012	(in thousands)
Noncovered loans:
Commercial business:
Secured	$	1,011,722	$	29,222	$	65,607	$	—	$	—	$	1,106,551
Unsecured	44,788		26		529		—		—		45,343
Real estate:
One-to-four family residential	40,346		406		3,440		—		—		44,192
Commercial and multifamily residential:
Commercial land	43,401		—		3,926		—		—		47,327
Income property	581,671		3,688		29,453		—		—		614,812
Owner occupied	357,063		1,848		36,262		—		—		395,173
Real estate construction:
One-to-four family residential:
Land and acquisition	12,741		1,351		4,404		—		—		18,496
Residential construction	28,705		1,142		1,817		—		—		31,664
Commercial and multifamily residential:
Income property	28,342		—		—		—		—		28,342
Owner occupied	36,211		—		—		—		—		36,211
Consumer	151,049		75		6,475		—		—		157,599
Total	$	2,336,039	$	37,758	$	151,913	$	—	$	—	2,525,710
Less:
Allowance for loan losses											52,244
Noncovered loans, net											$	2,473,466