Mortgage Loans on Real Estate (Tables)

9 Months Ended

Sep. 30, 2015

Mortgage Loans on Real Estate [Abstract]

Our mortgage loan portfolio, summarized in the following table, totaled $2.5 billion at September 30, 2015 and $2.4 billion December 31, 2014, respectively, with commitments outstanding of $64.3 million at September 30, 2015.



	September 30, 2015			December 31, 2014
	(Dollars in thousands)
Principal outstanding	$	2,470,456		$	2,457,721
Loan loss allowance	(17,518		)	(22,633		)
Deferred prepayment fees	(536		)	(508		)
Carrying value	$	2,452,402		$	2,434,580

Mortgage Loan Portfolio Summarized by Geographic Region and Property Type

The mortgage loan portfolio is summarized by geographic region and property type as follows:



	September 30, 2015				December 31, 2014
	Principal		Percent		Principal		Percent
	(Dollars in thousands)
Geographic distribution
East	$	720,522	29.2	%	$	701,638	28.5	%
Middle Atlantic	160,946		6.5	%	166,249		6.8	%
Mountain	255,454		10.3	%	279,075		11.4	%
New England	13,267		0.5	%	12,280		0.5	%
Pacific	359,231		14.6	%	302,307		12.3	%
South Atlantic	451,123		18.3	%	471,849		19.2	%
West North Central	311,774		12.6	%	349,028		14.2	%
West South Central	198,139		8.0	%	175,295		7.1	%
	$	2,470,456	100.0	%	$	2,457,721	100.0	%
Property type distribution
Office	$	417,122	16.9	%	$	484,585	19.7	%
Medical Office	84,843		3.4	%	88,275		3.6	%
Retail	768,210		31.1	%	711,775		29.0	%
Industrial/Warehouse	688,336		27.9	%	649,425		26.4	%
Hotel	3,412		0.1	%	30,640		1.3	%
Apartment	362,809		14.7	%	335,087		13.6	%
Mixed use/other	145,724		5.9	%	157,934		6.4	%
	$	2,470,456	100.0	%	$	2,457,721	100.0	%

Rollforward of Allowance for Credit Losses

The following table presents a rollforward of our specific and general valuation allowances for mortgage loans on real estate:



	Three Months Ended September 30, 2015						Three Months Ended September 30, 2014
	Specific Allowance			General Allowance			Specific Allowance			General Allowance
	(Dollars in thousands)
Beginning allowance balance	$	(9,316	)	$	(7,500	)	$	(17,282	)	$	(9,300	)
Charge-offs	—			—			958			—
Change in provision for credit losses	(1,302		)	600			(1,040		)	(1,200		)
Ending allowance balance	$	(10,618	)	$	(6,900	)	$	(17,364	)	$	(10,500	)

	Nine Months Ended September 30, 2015						Nine Months Ended September 30, 2014
	Specific Allowance			General Allowance			Specific Allowance			General Allowance
	(Dollars in thousands)
Beginning allowance balance	$	(12,333	)	$	(10,300	)	$	(16,847	)	$	(9,200	)
Charge-offs	143			—			3,715			—
Recoveries	4,375			—			255			—
Change in provision for credit losses	(2,803		)	3,400			(4,487		)	(1,300		)
Ending allowance balance	$	(10,618	)	$	(6,900	)	$	(17,364	)	$	(10,500	)

Impaired Mortgage Loans on Real Estate by Basis of Impairment

The following table presents the total outstanding principal of loans evaluated for impairment by basis of impairment method:



	September 30, 2015		December 31, 2014
	(Dollars in thousands)
Individually evaluated for impairment	$	27,244	$	29,116
Collectively evaluated for impairment	2,443,212		2,428,605
Total loans evaluated for impairment	$	2,470,456	$	2,457,721

Real Estate Acquired Via Foreclosure or Deed In Lieu

The following table summarizes the activity in the real estate owned, included in Other investments, which was obtained in satisfaction of mortgage loans on real estate:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(Dollars in thousands)
Real estate owned at beginning of period	$	12,958		$	24,606		$	20,238		$	22,844
Real estate acquired in satisfaction of mortgage loans	—			1,748			—			11,755
Additions	120			—			120			—
Sales	(2,761		)	(2,431		)	(9,241		)	(9,579		)
Impairments	(570		)	(1,436		)	(1,199		)	(2,235		)
Depreciation	(53		)	(153		)	(224		)	(451		)
Real estate owned at end of period	$	9,694		$	22,334		$	9,694		$	22,334

Mortgage Loans By Credit Quality Indicator

We analyze credit risk of our mortgage loans by analyzing all available evidence on loans that are delinquent and loans that are in a workout period.



	September 30, 2015		December 31, 2014
	(Dollars in thousands)
Credit Exposure--By Payment Activity
Performing	$	2,443,679	$	2,451,760
In workout	10,739		—
Delinquent	—		—
Collateral dependent	16,038		5,961
	$	2,470,456	$	2,457,721

Aging of Financing Receivables

Aging of financing receivables is summarized in the following table, with loans in a "workout" period as of the reporting date considered current if payments are current in accordance with agreed upon terms:



	30 - 59 Days		60 - 89 Days		90 Days and Over		Total Past Due		Current		Collateral Dependent Receivables		Total Financing Receivables
	(Dollars in thousands)
Commercial Mortgage Loans
September 30, 2015	$	—	$	—	$	—	$	—	$	2,454,418	$	16,038	$	2,470,456
December 31, 2014	$	—	$	—	$	—	$	—	$	2,451,760	$	5,961	$	2,457,721

Impaired Financing Receivables

Financing receivables summarized in the following two tables represent all loans that we are either not currently collecting, or those we feel it is probable we will not collect, all amounts due according to the contractual terms of the loan agreements (all loans that we have worked with the borrower to alleviate short-term cash flow issues, loans delinquent for 60 days or more at the reporting date, loans we have determined to be collateral dependent and loans that we have recorded specific impairments on that we feel may continue to have performance issues).



	Recorded Investment		Unpaid Principal Balance		Related Allowance
	(Dollars in thousands)
September 30, 2015
Mortgage loans with an allowance	$	16,626	$	27,244	$	(10,618	)
Mortgage loans with no related allowance	13,396		13,396		—
	$	30,022	$	40,640	$	(10,618	)
December 31, 2014
Mortgage loans with an allowance	$	16,783	$	29,116	$	(12,333	)
Mortgage loans with no related allowance	2,656		2,656		—
	$	19,439	$	31,772	$	(12,333	)



	Average Recorded Investment		Interest Income Recognized
	(Dollars in thousands)
Three months ended September 30, 2015
Mortgage loans with an allowance	$	17,336	$	44
Mortgage loans with no related allowance	13,414		176
	$	30,750	$	220
Three months ended September 30, 2014
Mortgage loans with an allowance	$	22,157	$	539
Mortgage loans with no related allowance	2,656		—
	$	24,813	$	539
Nine months ended September 30, 2015
Mortgage loans with an allowance	$	17,649	$	866
Mortgage loans with no related allowance	13,432		595
	$	31,081	$	1,461
Nine months ended September 30, 2014
Mortgage loans with an allowance	$	23,580	$	1,696
Mortgage loans with no related allowance	2,656		—
	$	26,236	$	1,696

Troubled Debt Restructurings on Financing Receivables

Mortgage loan workouts, refinances or restructures that are classified as TDRs are individually evaluated and measured for impairment. A summary of mortgage loans on commercial real estate with outstanding principal at September 30, 2015 and December 31, 2014 that we determined to be TDRs are as follows:



Geographic Region	Number of TDRs	Principal Balance Outstanding		Specific Loan Loss Allowance			Net Carrying Amount
		(Dollars in thousands)
September 30, 2015
South Atlantic	6	$	10,878	$	(2,992	)	$	7,886
East North Central	2	3,345		(467		)	2,878
West North Central	2	7,790		(1,046		)	6,744
	10	$	22,013	$	(4,505	)	$	17,508
December 31, 2014
South Atlantic	7	$	14,475	$	(4,244	)	$	10,231
East North Central	1	2,177		(467		)	1,710
West North Central	1	1,881		(1,047		)	834
	9	$	18,533	$	(5,758	)	$	12,775