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ASSOCIATED BANC-CORP - Quarter Report: 2023 June (Form 10-Q)

Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: June 30, 2023
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to 
Commission file number: 001-31343

Associated Banc-Corp
(Exact name of registrant as specified in its charter)
Wisconsin39-1098068
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
433 Main Street
Green Bay,Wisconsin54301
(Address of principal executive offices)(Zip Code)
(920) 491-7500
(Registrant’s telephone number, including area code)
(not applicable)
(Former name, former address and former fiscal year, if changed since last report)

Securities Registered Pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common stock, par value $0.01 per shareASBNew York Stock Exchange
Depositary Shrs, each representing 1/40th intrst in a shr of 5.875% Non-Cum. Perp Pref Stock, Srs EASB PrENew York Stock Exchange
Depositary Shrs, each representing 1/40th intrst in a shr of 5.625% Non-Cum. Perp Pref Stock, Srs FASB PrFNew York Stock Exchange
6.625% Fixed-Rate Reset Subordinated Notes due 2033ASBANew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes          No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes          No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer 
Non-accelerated filer  Smaller reporting company  
Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes          No  
APPLICABLE ONLY TO CORPORATE ISSUERS:

The number of shares outstanding of registrant’s common stock, par value $0.01 per share, at July 24, 2023 was 150,921,090.
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ASSOCIATED BANC-CORP
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ASSOCIATED BANC-CORP
Commonly Used Acronyms, Abbreviations, and Defined Terms
The following listing provides a reference of common acronyms and abbreviations used throughout the document:
ACLLAllowance for Credit Losses on Loans
AFSAvailable for Sale
ALCO Asset / Liability Committee
ASUAccounting Standards Update
the BankAssociated Bank, National Association
Basel IIIInternational framework established by the Basel Committee on Banking Supervision for the regulation of capital and liquidity
bpbasis point(s)
BTFPBank Term Funding Program
Call ReportConsolidated Reports of Condition and Income
CDsCertificates of Deposit
CDIsCore Deposit Intangibles
CECLCurrent Expected Credit Losses
CET1Common Equity Tier 1
Corporation / our / weAssociated Banc-Corp collectively with all of its subsidiaries and affiliates
CRACommunity Reinvestment Act
CRECommercial Real Estate
EAREarnings at Risk
ESPPAssociated Banc-Corp Employee Stock Purchase Plan
Exchange ActSecurities Exchange Act of 1934, as amended
FASBFinancial Accounting Standards Board
FDICFederal Deposit Insurance Corporation
Federal ReserveBoard of Governors of the Federal Reserve System
FFELPFederal Family Education Loan Program
FHLBFederal Home Loan Bank
FHLMCFederal Home Loan Mortgage Corporation
FICOFair Isaac Corporation, provider of a broad-based risk score to aid in credit decisions
FNMAFederal National Mortgage Association
FTEsFull-time equivalent employees
FTPFunds Transfer Pricing
GAAPGenerally Accepted Accounting Principles
GNMAGovernment National Mortgage Association
GSEsGovernment-Sponsored Enterprises
HTMHeld to Maturity
LIBORLondon Interbank Offered Rate
LOCOMLower of Cost or Market
LTVLoan-to-Value
Moody's
Moody’s Investors Service
MSRsMortgage Servicing Rights
MVEMarket Value of Equity
Net Free FundsNoninterest-bearing sources of funds
NPAsNonperforming Assets
OCIOther Comprehensive Income
OREOOther Real Estate Owned
Parent CompanyAssociated Banc-Corp individually
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RAPRetirement Account Plan - the Corporation's noncontributory defined benefit retirement plan
Repurchase AgreementsSecurities sold under agreements to repurchase
Restricted Stock AwardsRestricted common stock and restricted common stock units to certain key employees
Retirement Eligible ColleaguesColleagues whose retirement meets the early retirement or normal retirement definitions under the applicable equity compensation plan
ROCET1
Return on Common Equity Tier 1
SBASmall Business Administration
SECU.S. Securities and Exchange Commission
Series E Preferred StockThe Corporation's 5.875% Non-Cumulative Perpetual Preferred Stock, Series E, liquidation preference $1,000 per share
Series F Preferred StockThe Corporation's 5.625% Non-Cumulative Perpetual Preferred Stock, Series F, liquidation preference $1,000 per share
SOFRSecured Overnight Finance Rate
TDRsTroubled Debt Restructurings
YTDYear-to-Date

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PART I - FINANCIAL INFORMATION
ITEM 1.Financial Statements:
ASSOCIATED BANC-CORP
Consolidated Balance Sheets
 Jun 30, 2023Dec 31, 2022
 (In thousands, except share and per share data)
(Unaudited)(Audited)
Assets
Cash and due from banks$407,620 $436,952 
Interest-bearing deposits in other financial institutions190,881 156,693 
Federal funds sold and securities purchased under agreements to resell31,160 27,810 
AFS investment securities, at fair value3,504,777 2,742,025 
HTM investment securities, net, at amortized cost3,938,877 3,960,398 
Equity securities30,883 25,216 
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost271,637 295,496 
Residential loans held for sale38,083 20,383 
Commercial loans held for sale15,000 — 
Loans29,848,904 28,799,569 
Allowance for loan losses(338,750)(312,720)
Loans, net29,510,153 28,486,849 
Tax credit and other investments263,583 276,773 
Premises and equipment, net374,866 376,906 
Bank and corporate owned life insurance678,578 676,530 
Goodwill1,104,992 1,104,992 
Other intangible assets, net44,877 49,282 
Mortgage servicing rights, net80,449 77,351 
Interest receivable159,185 144,449 
Other assets573,870 547,621 
Total assets$41,219,473 $39,405,727 
Liabilities and stockholders' equity
Noninterest-bearing demand deposits$6,565,666 $7,760,811 
Interest-bearing deposits25,448,743 21,875,343 
Total deposits32,014,409 29,636,154 
Federal funds purchased and securities sold under agreements to repurchase325,927 585,139 
Commercial paper15,327 20,798 
FHLB advances3,630,747 4,319,861 
Other long-term funding534,273 248,071 
Allowance for unfunded commitments38,276 38,776 
Accrued expenses and other liabilities537,640 541,438 
Total liabilities$37,096,599 $35,390,237 
Stockholders’ equity
Preferred equity$194,112 $194,112 
Common equity
Common stock$1,752 $1,752 
Surplus1,708,303 1,712,733 
Retained earnings3,025,637 2,904,882 
Accumulated other comprehensive (loss)(291,642)(272,799)
Treasury stock, at cost(515,287)(525,190)
Total common equity3,928,762 3,821,378 
Total stockholders’ equity4,122,874 4,015,490 
Total liabilities and stockholders’ equity$41,219,473 $39,405,727 
Preferred shares authorized (par value $1.00 per share)
750,000 750,000 
Preferred shares issued and outstanding200,000 200,000 
Common shares authorized (par value $0.01 per share)
250,000,000 250,000,000 
Common shares issued175,216,409 175,216,409 
Common shares outstanding150,918,628 150,444,019 
Numbers may not sum due to rounding.

See accompanying notes to consolidated financial statements.
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Item 1. Financial Statements Continued:
ASSOCIATED BANC-CORP
Consolidated Statements of Income (Unaudited)
 Three Months Ended Jun 30,Six Months Ended Jun 30,
 (In thousands, except per share data)
2023202220232022
Interest income
Interest and fees on loans$423,307 $199,876 $814,626 $367,573 
Interest and dividends on investment securities
Taxable35,845 18,317 65,987 34,789 
Tax-exempt15,994 16,379 32,019 32,487 
Other interest6,086 2,420 11,415 4,413 
Total interest income481,231 236,991 924,048 439,261 
Interest expense
Interest on deposits162,196 8,019 271,618 11,591 
Interest on federal funds purchased and securities sold under agreements to repurchase2,261 406 5,404 444 
Interest on other short-term funding— 
Interest on FHLB advances49,261 9,689 99,222 17,871 
Interest on long-term funding9,596 2,730 15,876 5,460 
Total interest expense223,314 20,845 392,121 35,367 
Net interest income257,917 216,146 531,927 403,893 
Provision for credit losses22,100 (2)40,071 (3,992)
Net interest income after provision for credit losses235,817 216,148 491,856 407,886 
Noninterest income
Wealth management fees20,483 21,332 40,672 43,735 
Service charges and deposit account fees12,372 16,506 25,366 33,363 
Card-based fees11,396 11,442 21,982 21,368 
Other fee-based revenue4,465 4,360 8,740 8,126 
Capital markets, net5,093 8,010 10,176 16,656 
Mortgage banking, net7,768 6,145 11,313 14,536 
Bank and corporate owned life insurance 2,172 4,106 4,835 6,177 
Asset gains (losses), net(299)1,677 (35)1,865 
Investment securities gains (losses), net14 (8)66 12 
Other2,080 1,888 4,501 4,086 
Total noninterest income65,543 75,458 127,616 149,925 
Noninterest expense
Personnel114,089 112,666 230,510 217,477 
Technology24,220 21,223 47,818 42,707 
Occupancy13,587 14,151 28,650 30,231 
Business development and advertising7,106 5,655 12,955 10,610 
Equipment4,975 4,960 9,906 9,920 
Legal and professional4,831 4,873 8,688 9,960 
Loan and foreclosure costs1,635 1,476 2,773 3,490 
FDIC assessment9,550 5,400 16,425 10,500 
Other intangible amortization2,203 2,203 4,405 4,405 
Other8,476 8,815 15,955 15,412 
Total noninterest expense190,673 181,420 378,086 354,712 
Income before income taxes110,687 110,187 241,386 203,099 
Income tax expense23,533 23,363 50,873 42,013 
Net income87,154 86,824 190,514 161,086 
Preferred stock dividends2,875 2,875 5,750 5,750 
Net income available to common equity$84,279 $83,949 $184,764 $155,336 
Earnings per common share
Basic$0.56 $0.56 $1.23 $1.04 
Diluted$0.56 $0.56 $1.22 $1.03 
Average common shares outstanding
Basic149,986 149,083 149,875 148,933 
Diluted150,870 150,203 150,903 150,265 

Numbers may not sum due to rounding.
See accompanying notes to consolidated financial statements.
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Item 1. Financial Statements Continued:
ASSOCIATED BANC-CORP
Consolidated Statements of Comprehensive Income (Unaudited)
Three Months Ended Jun 30,Six Months Ended Jun 30,
 ($ in thousands)
2023202220232022
Net income$87,154 $86,824 $190,514 $161,086 
Other comprehensive (loss), net of tax
AFS investment securities
Net unrealized (losses)(49,066)(65,038)(12,588)(168,321)
Unrealized (losses) on AFS securities transferred to HTM securities— — — (67,604)
Amortization of net unrealized losses on AFS securities transferred to HTM securities2,289 3,273 4,556 4,381 
Reclassification adjustment for net losses (gains) realized in net income— — (12)
Income tax benefit11,843 15,998 1,951 59,096 
Other comprehensive (loss) on AFS securities(34,934)(45,758)(6,081)(172,460)
Cash flow hedge derivatives
Net unrealized (losses)(34,147)— (20,384)— 
Reclassification adjustment for net losses realized in net income3,319 — 4,581 — 
Income tax benefit7,867 — 3,173 — 
Other comprehensive (loss) on cash flow hedge derivatives(22,961)— (12,630)— 
Defined benefit pension and postretirement obligations
Amortization of prior service cost(81)(81)(163)(163)
Amortization of actuarial loss(7)74 22 147 
Income tax benefit (expense)(71)
Other comprehensive (loss) on pension and postretirement obligations(159)(6)(132)(12)
Total other comprehensive (loss)(58,054)(45,764)(18,843)(172,472)
Comprehensive income (loss)$29,100 $41,060 $171,671 $(11,386)
Numbers may not sum due to rounding.
See accompanying notes to consolidated financial statements.

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Item 1. Financial Statements Continued:    
ASSOCIATED BANC-CORP
Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)
(In thousands, except per share data)Preferred EquityCommon StockSurplusRetained
Earnings
Accumulated
Other
Comprehensive
 (Loss)
Treasury StockTotal
Balance, December 31, 2022$194,112 $1,752 $1,712,733 $2,904,882 $(272,799)$(525,190)$4,015,490 
Comprehensive income:
Net income— — — 103,360 — — 103,360 
Other comprehensive income— — — — 39,211 — 39,211 
Comprehensive income142,571 
Common stock issued:
Stock-based compensation plans, net— — (12,612)— — 14,379 1,766 
Purchase of treasury stock, stock-based compensation plans— — — — — (5,362)(5,362)
Cash dividends:
Common stock, $0.21 per share— — — (32,013)— — (32,013)
Preferred stock(a)
— — — (2,875)— — (2,875)
Stock-based compensation expense, net— — 6,086 — — — 6,086 
Balance, March 31, 2023$194,112 $1,752 $1,706,206 $2,973,354 $(233,588)$(516,173)$4,125,663 
Comprehensive income:
Net income— — — 87,154 — — 87,154 
Other comprehensive (loss)— — — — (58,054)— (58,054)
Comprehensive income29,100 
Common stock issued:
Stock-based compensation plans, net— — (1,677)— — 1,770 93 
Purchase of treasury stock, stock-based compensation plans— — — — — (884)(884)
Cash dividends:
Common stock, $0.21 per share— — — (31,996)— — (31,996)
Preferred stock(a)
— — — (2,875)— — (2,875)
Stock-based compensation expense, net— — 3,773 — — — 3,773 
Balance, June 30, 2023$194,112 $1,752 $1,708,303 $3,025,637 $(291,642)$(515,287)$4,122,874 
Numbers may not sum due to rounding.
(a) Series E, $0.3671875 per share; and Series F, $0.3515625 per share.


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(In thousands, except per share data)Preferred EquityCommon StockSurplusRetained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Treasury StockTotal
Balance, December 31, 2021$193,195 $1,752 $1,713,851 $2,672,601 $(10,317)$(546,229)$4,024,853 
Change in accounting principle(a)
— — — 1,713 — — 1,713 
Total stockholders' equity at beginning of period, as adjusted193,195 1,752 1,713,851 2,674,314 (10,317)(546,229)4,026,566 
Comprehensive (loss):
Net income— — — 74,262 — — 74,262 
Other comprehensive (loss)— — — — (126,708)— (126,708)
Comprehensive (loss)(52,445)
Common stock issued:
Stock-based compensation plans, net— — (11,911)— — 18,565 6,654 
Purchase of treasury stock, stock-based compensation plans— — — — — (5,193)(5,193)
Cash dividends:
Common stock, $0.20 per share— — — (30,583)— — (30,583)
Preferred stock(b)
— — — (2,875)— — (2,875)
Stock-based compensation expense, net— — 6,164 — — — 6,164 
Balance, March 31, 2022$193,195 $1,752 $1,708,104 $2,715,118 $(137,024)$(532,858)$3,948,287 
Comprehensive income:
Net income— — — 86,824 — — 86,824 
Other comprehensive (loss)— — — — (45,764)— (45,764)
Comprehensive income41,060 
Common stock issued:
Stock-based compensation plans, net— — (1,771)— — 1,910 139 
Purchase of treasury stock, stock-based compensation plans— — — — — (884)(884)
Cash dividends:
Common stock, $0.20 per share— — — (30,331)— — (30,331)
Preferred stock(b)
— — — (2,875)— — (2,875)
Stock-based compensation expense, net— — 3,986 — — — 3,986 
Balance, June 30, 2022$193,195 $1,752 $1,710,319 $2,768,736 $(182,788)$(531,832)$3,959,382 
Numbers may not sum due to rounding.
(a) MSRs at December 31, 2021 were carried at LOCOM. On January 1, 2022, the Corporation made the irrevocable election to account for MSRs at fair value.
(b) Series E, $0.3671875 per share; and Series F, $0.3515625 per share.


See accompanying notes to consolidated financial statements.




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Item 1. Financial Statements Continued:
ASSOCIATED BANC-CORP
Consolidated Statements of Cash Flows (Unaudited)
Six Months Ended Jun 30,
 ($ in thousands)
20232022
Cash flows from operating activities
Net income$190,514 $161,086 
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses40,071 (3,992)
Depreciation and amortization22,914 22,741 
Change in MSRs valuation(5,135)(19,400)
Amortization of other intangible assets4,405 4,405 
Amortization and accretion on earning assets, funding, and other, net16,509 10,315 
Net amortization of tax credit investments17,227 17,072 
(Gains) on sales of investment securities, net— (12)
Asset losses (gains), net35 (1,865)
Loss on mortgage banking activities, net1,389 3,036 
Mortgage loans originated and acquired for sale(168,395)(403,951)
Proceeds from sales of mortgage loans held for sale151,167 500,410 
Changes in certain assets and liabilities:
(Increase) in interest receivable(14,736)(14,898)
Increase in interest payable44,367 1,501 
(Decrease) in expense payable(40,882)(24,791)
(Decrease) increase in net derivative position(37,175)231,332 
Net change in other assets and other liabilities(43,503)6,051 
Net cash provided by operating activities178,771 489,039 
Cash flows from investing activities
Net (increase) in loans(1,054,924)(2,271,051)
Purchases of:
AFS securities(948,326)(502,012)
HTM securities(41,524)(202,271)
Federal Home Loan Bank and Federal Reserve Bank stocks and equity securities(97,622)(70,239)
Proceeds from:
Sales of AFS securities— 1,061 
Sale of Federal Home Loan Bank and Federal Reserve Bank stocks and equity securities115,975 
Prepayments, calls, and maturities of AFS securities 172,680 296,179 
Prepayments, calls, and maturities of HTM securities 62,212 111,796 
Sales, prepayments, calls, and maturities of other assets17,988 23,523 
Premises, equipment, and software, net of disposals(29,663)(33,373)
Net change in tax credit and alternative investments(14,116)(34,186)
Net cash (used in) investing activities(1,817,320)(2,680,566)
Cash flows from financing activities
Net increase in deposits2,378,308 110,280 
Net increase (decrease) in short-term funding(264,684)351,358 
Net increase (decrease) in short-term FHLB advances(685,000)2,045,000 
Repayment of long-term FHLB advances(537)(408,870)
Proceeds from long-term FHLB advances115 916 
Proceeds from issuance of long-term funding292,740 — 
(Repayment) proceeds of finance lease principal(43)348 
Proceeds from issuance of common stock for stock-based compensation plans1,859 6,793 
Purchase of treasury stock, stock-based compensation plans(6,246)(6,078)
Cash dividends on common stock(64,009)(60,914)
Cash dividends on preferred stock(5,750)(5,750)
Net cash provided by financing activities1,646,755 2,033,084 
Net increase (decrease) in cash and cash equivalents8,207 (158,444)
Cash and cash equivalents at beginning of period621,455 1,025,515 
Cash and cash equivalents at end of period(a)
$629,662 $867,071 
Numbers may not sum due to rounding.
(a) No restricted cash due to the Federal Reserve reducing the required reserve ratio to zero.
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ASSOCIATED BANC-CORP
Consolidated Statements of Cash Flows (Unaudited)
Six Months Ended Jun 30,
 ($ in thousands)
20232022
Supplemental disclosures of cash flow information
Cash paid for interest$347,202 $33,533 
Cash paid for income and franchise taxes58,985 2,432 
Loans and bank premises transferred to OREO3,632 1,817 
Capitalized mortgage servicing rights1,322 5,231 
Loans transferred into (from) held for sale from (into) portfolio, net(840)4,149 
Transfer of AFS securities to HTM securities— 1,621,990 
Unsettled trades to purchase securities— 1,450 
Fair value adjustments on hedged long-term FHLB advances and subordinated debt9,651 — 
Fair value adjustment on cash flow hedges(12,630)— 

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Item 1. Financial Statements Continued:
ASSOCIATED BANC-CORP
Notes to Consolidated Financial Statements
These interim consolidated financial statements have been prepared according to the rules and regulations of the SEC and, therefore, certain information and footnote disclosures normally presented in accordance with GAAP have been omitted or abbreviated. The information contained on the consolidated financial statements and footnotes in Associated Banc-Corp's 2022 Annual Report on Form 10-K should be referred to in connection with the reading of these unaudited interim consolidated financial statements.
Note 1 Basis of Presentation
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the financial position, results of operations and comprehensive income, changes in stockholders’ equity, and cash flows of the Corporation and Parent Company for the periods presented, and all such adjustments are of a normal recurring nature. The consolidated financial statements include the accounts of all subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.
In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period. Actual results could differ significantly from those estimates. Estimates that are particularly susceptible to significant change include the determination of the ACLL. Management has evaluated subsequent events for potential recognition or disclosure.
Within the tables presented, certain columns and rows may not sum due to the use of rounded numbers for disclosure purposes.
Note 2 Summary of Significant Accounting Policies
The accounting and reporting policies of the Corporation conform to U.S. GAAP and to general practice within the financial services industry. A discussion of these policies can be found in Note 1 Summary of Significant Accounting Policies included in the Corporation’s 2022 Annual Report on Form 10-K.
New Accounting Pronouncements Adopted
StandardDescriptionDate of adoptionEffect on financial statements
ASU 2022-02 Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage DisclosuresThe FASB issued these amendments to eliminate accounting guidance for TDRs by creditors in Subtopic 310-40, Receivables-Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty, and to require that an entity disclose current-period gross writeoffs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20, Financial Instruments-Credit Losses-Measured at Amortized Cost. The amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, and should be applied prospectively, except as provided in the next sentence. For the transition method related to the recognition and measurement of TDRs, an entity has the option to apply a modified retrospective transition method, resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. Early adoption is permitted if an entity has adopted the amendments in Update 2016-03, including adoption in an interim period.1st Quarter 2023Adoption of this amendment did not have a material impact on the Corporation's results of operation, financial position or liquidity, but resulted in additional disclosure requirements related to gross charge offs by vintage year and the removal of TDR disclosures, replaced by additional disclosures on the types of modifications of loans to borrowers experiencing financial difficulties. The Corporation has adopted this update prospectively.
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Future Accounting Pronouncements
The expected impact of applicable material accounting pronouncements recently issued or proposed but not yet required to be adopted are discussed in the table below. To the extent that the adoption of new accounting standards materially affects the Corporation's financial condition, results of operations, liquidity or disclosures, the impacts are discussed in the applicable sections of this financial review.
StandardDescriptionDate of anticipated adoptionEffect on financial statements
ASU 2023-02 Investments-Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization MethodThe amendments in this update permit reporting entities to elect to account for their tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. A reporting entity may make an accounting policy election to apply the proportional amortization method on a tax-credit-program-by-tax-credit-program basis rather than electing to apply the proportional amortization method at the reporting entity level or to individual investments. The amendments in this update also remove certain guidance for Qualified Affordable Housing Project investments and require the application of the delayed equity contribution guidance to all tax equity investments. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and must be applied on either a modified retrospective or a retrospective basis. Early adoption is permitted in any interim period, however if adopted in an interim period the entity shall adopt the amendments in this update as of the beginning of the fiscal year that includes the interim period. 1st Quarter 2024The Corporation is currently evaluating the impact on its results of operation, financial position, liquidity, and disclosures.
Note 3 Earnings Per Common Share
Earnings per common share are calculated utilizing the two-class method. Basic earnings per common share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per common share are calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding adjusted for the dilutive effect of common stock awards (outstanding stock options and unvested restricted stock awards). Presented below are the calculations for basic and diluted earnings per common share:
 Three Months Ended Jun 30,Six Months Ended Jun 30,
 ($ in thousands, except per share data)2023202220232022
Net income$87,154 $86,824 $190,514 $161,086 
Preferred stock dividends(2,875)(2,875)(5,750)(5,750)
Net income available to common equity$84,279 $83,949 $184,764 $155,336 
Common shareholder dividends(31,802)(30,126)(63,611)(60,499)
Unvested share-based payment awards(194)(205)(398)(415)
Undistributed earnings$52,283 $53,618 $120,755 $94,422 
Undistributed earnings allocated to common shareholders$51,965 $53,257 $120,047 $93,807 
Undistributed earnings allocated to unvested share-based payment awards318 361 708 615 
Undistributed earnings$52,283 $53,618 $120,755 $94,422 
Basic
Distributed earnings to common shareholders$31,802 $30,126 $63,611 $60,499 
Undistributed earnings allocated to common shareholders51,965 53,257 120,047 93,807 
Total common shareholders earnings, basic$83,768 $83,383 $183,658 $154,306 
Diluted
Distributed earnings to common shareholders$31,802 $30,126 $63,611 $60,499 
Undistributed earnings allocated to common shareholders51,965 53,257 120,047 93,807 
Total common shareholders earnings, diluted$83,768 $83,383 $183,658 $154,306 
Weighted average common shares outstanding149,986 149,083 149,875 148,933 
Effect of dilutive common stock awards884 1,121 1,027 1,332 
Diluted weighted average common shares outstanding150,870 150,203 150,903 150,265 
Basic earnings per common share$0.56 $0.56 $1.23 $1.04 
Diluted earnings per common share$0.56 $0.56 $1.22 $1.03 
Approximately 5 million and 3 million anti-dilutive common stock shares were excluded from the earnings per common share calculation for the three months ended June 30, 2023 and 2022, respectively, and approximately 3 million anti-dilutive common
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stock shares were excluded from the earnings per common share calculation for both the six months ended June 30, 2023 and 2022.
Note 4 Stock-Based Compensation
The fair values of stock options and restricted stock awards are amortized as compensation expense on a straight-line basis over the vesting period of the grants. For colleagues who meet the definition of retirement eligible under the 2017 Incentive Compensation Plan and the 2020 Incentive Compensation Plan, expenses related to stock options and restricted stock awards are fully recognized on the date the colleague meets the definition of normal or early retirement. Compensation expense recognized is included in personnel expense on the consolidated statements of income.
A summary of the Corporation’s stock option activity for the six months ended June 30, 2023 is presented below:
Stock Options
Shares(a)
Weighted Average
Exercise Price
Weighted Average Remaining Contractual Term
Aggregate Intrinsic Value(a)
Outstanding at December 31, 20223,994 $21.06 5.11 years$10,525 
Exercised35 17.06 
Forfeited or expired10 23.45 
Outstanding at June 30, 20233,949 $21.09 4.63 years$— 
Options Exercisable at June 30, 20233,735 $21.27 4.52 years$— 
(a) In thousands
Intrinsic value represents the amount by which the fair market value of the underlying stock exceeds the exercise price of the stock option. For the six months ended June 30, 2023, the intrinsic value of stock options exercised was approximately $220,000, compared to $3 million for the six months ended June 30, 2022. For the six months ended June 30, 2023, the total fair value of stock options vested was approximately $955,000 compared to $2 million for the six months ended June 30, 2022.
The Corporation recognized compensation expense for the vesting of stock options of approximately $186,000 for the six months ended June 30, 2023, compared to approximately $469,000 for the six months ended June 30, 2022. At June 30, 2023, the Corporation had approximately $192,000 of unrecognized compensation expense related to stock options that is expected to be recognized over the remaining requisite service periods that extend predominately through the first quarter of 2024.
The Corporation also has issued time-based and performance-based restricted stock awards under the 2017 Incentive Compensation Plan and subsequent 2020 Incentive Compensation Plan. Performance awards are based on performance goals determined by the Compensation and Benefits Committee of the Corporation's Board of Directors, with vesting ranging from a minimum of 0% to a maximum of 150% of the target award. Performance awards are valued utilizing a Monte Carlo simulation model to estimate fair value of the awards at the grant date.
The following table summarizes information about the Corporation’s restricted stock awards activity for the six months ended June 30, 2023:
Restricted Stock
Shares(a)
Weighted Average
Grant Date Fair Value
Outstanding at December 31, 20222,303 $20.81 
Granted822 22.61 
Vested737 21.13 
Forfeited22 22.14 
Outstanding at June 30, 20232,366 $21.33 
(a) In thousands
The Corporation amortizes the expense related to restricted stock awards as compensation expense over the vesting period specified in the grant's award agreement. Performance-based restricted stock awards granted during 2022 and 2023 will cliff-vest after the three year performance period has ended. Service-based restricted stock awards granted during 2022 and 2023 will generally vest ratably over a period of four years. Expense for restricted stock awards of $10 million was recorded for both the six months ended June 30, 2023 and the six months ended June 30, 2022. Included in compensation expense for the first six months of 2023 was $3 million of expense for the accelerated vesting of restricted stock awards granted to retirement eligible colleagues. The Corporation had $27 million of unrecognized compensation costs related to restricted stock awards at June 30, 2023 that are expected to be recognized over the remaining requisite service periods that extend predominately through the first quarter of 2027.
The Corporation has the ability to issue shares from treasury or new shares upon the exercise of stock options or the granting of restricted stock awards. The Board of Directors has authorized management to repurchase shares of the Corporation’s common stock, to be made available for issuance in connection with the Corporation’s employee incentive plans and for other corporate
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purposes. The repurchase of shares, if any, will be based on market and investment opportunities, capital levels, growth prospects, and regulatory constraints. Such repurchases may occur from time to time in open market purchases, block transactions, private transactions, accelerated share repurchase programs, or similar facilities.
Note 5 Investment Securities
Investment securities are designated as AFS, HTM, or equity on the consolidated balance sheets at the time of purchase. The amortized cost and fair values of AFS and HTM securities at June 30, 2023 were as follows:
($ in thousands)Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
(Losses)
Fair Value
AFS investment securities
U. S. Treasury securities$124,516 $— $(14,563)$109,954 
Agency securities15,000 — (1,483)13,517 
Obligations of state and political subdivisions (municipal securities)227,928 75 (5,515)222,487 
Residential mortgage-related securities:
FNMA/FHLMC1,734,097 108 (213,265)1,520,939 
GNMA1,309,202 198 (18,761)1,290,640 
Commercial mortgage-related securities:
FNMA/FHLMC18,866 — (1,772)17,095 
GNMA191,630 — (8,284)183,346 
Asset backed securities:
FFELP144,376 — (4,211)140,166 
SBA3,757 11 (47)3,721 
Other debt securities3,000 — (87)2,913 
Total AFS investment securities$3,772,373 $392 $(267,987)$3,504,777 
HTM investment securities
U. S. Treasury securities$999 $— $(59)$940 
Obligations of state and political subdivisions (municipal securities)1,713,510 1,978 (162,587)1,552,901 
Residential mortgage-related securities:
FNMA/FHLMC969,503 29,137 (171,849)826,791 
GNMA52,260 48 (3,500)48,808 
Private-label355,442 10,734 (72,395)293,782 
Commercial mortgage-related securities:
FNMA/FHLMC784,327 14,008 (174,942)623,393 
GNMA62,961 461 (7,946)55,477 
Total HTM investment securities$3,939,001 $56,368 $(593,278)$3,402,092 


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The amortized cost and fair values of AFS and HTM securities at December 31, 2022 were as follows:
($ in thousands)Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
(Losses)
Fair Value
AFS investment securities
U. S. Treasury securities$124,441 $— $(15,063)$109,378 
Agency securities15,000 — (1,468)13,532 
Obligations of state and political subdivisions (municipal securities)235,693 96 (5,074)230,714 
Residential mortgage-related securities:
FNMA/FHLMC1,820,642 404 (216,436)1,604,610 
GNMA502,537 314 (5,255)497,596 
Commercial mortgage-related securities:
FNMA/FHLMC19,038 — (1,896)17,142 
GNMA115,031 — (4,569)110,462 
Asset backed securities:
FFELP157,138 — (5,947)151,191 
SBA4,512 15 (51)4,477 
Other debt securities3,000 — (78)2,922 
Total AFS investment securities$2,997,032 $830 $(255,837)$2,742,025 
HTM investment securities
U. S. Treasury securities$999 $— $(62)$936 
Obligations of state and political subdivisions (municipal securities)1,732,351 1,994 (182,697)1,551,647 
Residential mortgage-related securities:
FNMA/FHLMC961,231 31,301 (175,760)816,771 
GNMA52,979 85 (3,436)49,628 
Private-label364,728 11,697 (72,920)303,505 
Commercial mortgage-related securities:
FNMA/FHLMC778,796 15,324 (178,281)615,839 
GNMA69,369 577 (7,254)62,691 
 Total HTM investment securities$3,960,451 $60,978 $(620,411)$3,401,018 
Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The expected maturities of AFS and HTM securities at June 30, 2023, are shown below:
 AFSHTM
($ in thousands)Amortized
Cost
Fair
Value
Amortized
Cost
Fair
Value
Due in one year or less$5,127 $5,115 $18,531 $18,528 
Due after one year through five years188,712 171,404 48,044 47,613 
Due after five years through ten years140,309 136,754 155,014 151,579 
Due after ten years36,296 35,598 1,492,920 1,336,121 
Total debt securities370,444 348,871 1,714,509 1,553,841 
Residential mortgage-related securities:
FNMA/FHLMC1,734,097 1,520,939 969,503 826,791 
GNMA1,309,202 1,290,640 52,260 48,808 
Private-label— — 355,442 293,782 
Commercial mortgage-related securities:
FNMA/FHLMC18,866 17,095 784,327 623,393 
GNMA191,630 183,346 62,961 55,477 
Asset backed securities:
FFELP 144,376 140,166 — — 
SBA3,757 3,721 — — 
Total investment securities$3,772,373 $3,504,777 $3,939,001 $3,402,092 
Ratio of fair value to amortized cost92.9 %86.4 %
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On a quarterly basis, the Corporation refreshes the credit quality of each HTM security. The following table summarizes the credit quality indicators of HTM securities at amortized cost at June 30, 2023:
($ in thousands)AAAAAANot RatedTotal
U. S. Treasury securities$999 $— $— $— $999 
Obligations of state and political subdivisions (municipal securities)781,385 924,263 6,705 1,156 1,713,510 
Residential mortgage-related securities:
FNMA/FHLMC969,503 — — — 969,503 
GNMA52,260 — — — 52,260 
Private-label355,442 — — — 355,442 
Commercial mortgage-related securities:
FNMA/FHLMC784,327 — — — 784,327 
GNMA 62,961 — — — 62,961 
Total HTM securities$3,006,877 $924,263 $6,705 $1,156 $3,939,001 
The following table summarizes the credit quality indicators of HTM securities at amortized cost at December 31, 2022:
($ in thousands)AAAAAANot RatedTotal
U. S. Treasury securities$999 $— $— $— $999 
Obligations of state and political subdivisions (municipal securities)806,529 917,059 7,604 1,158 1,732,351 
Residential mortgage-related securities:
FNMA/FHLMC961,231 — — — 961,231 
GNMA52,979 — — — 52,979 
Private-label364,728 — — — 364,728 
Commercial mortgage-related securities:
FNMA/FHLMC778,796 — — — 778,796 
GNMA 69,369 — — — 69,369 
Total HTM securities$3,034,630 $917,059 $7,604 $1,158 $3,960,451 
The following table summarizes gross realized gains and losses on AFS securities, net write-up of equity securities, and proceeds from the sale of AFS investment securities for the three and six months ended June 30, 2023 and 2022:
Three Months Ended Jun 30,Six Months Ended Jun 30,
($ in thousands)2023202220232022
Gross realized gains on AFS securities$— $— $— $21 
Gross realized (losses) on AFS securities— (8)— (8)
Net write-up of equity securities14 — 66 — 
Investment securities gains (losses), net$14 $(8)$66 $12 
Proceeds from sales of AFS investment securities$— $327 $— $1,061 
Investment securities with a carrying value of $1.8 billion and $2.3 billion at June 30, 2023 and December 31, 2022, respectively, were pledged as required to secure certain deposits or for other purposes.
Accrued interest receivable on HTM securities totaled $18 million and $19 million at June 30, 2023 and December 31, 2022, respectively. Accrued interest receivable on AFS securities totaled $13 million and $9 million at June 30, 2023 and December 31, 2022, respectively. Accrued interest receivable on both HTM and AFS securities is included in interest receivable on the consolidated balance sheets. There was no interest income reversed for investments going into nonaccrual at both June 30, 2023 and December 31, 2022.
A security is considered past due once it is 30 days past due under the terms of the agreement. At both June 30, 2023 and December 31, 2022, the Corporation had no past due HTM securities.

The allowance for credit losses on HTM securities was approximately $125,000 at June 30, 2023 and approximately $54,000 at December 31, 2022, attributable entirely to the Corporation's municipal securities, included in HTM investment securities, net, at amortized cost on the consolidated balance sheets. The Corporation also holds U.S. Treasury, municipal, and mortgage-related securities issued by the U.S. government or a GSE which are backed by the full faith and credit of the U.S. government and private-label residential mortgage-related securities that have credit enhancement which covers the first 15% of losses and, as a result, no allowance for credit losses has been recorded related to these securities.

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The following represents gross unrealized losses and the related fair value of AFS and HTM securities, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position, at June 30, 2023:
 Less than 12 months12 months or moreTotal
($ in thousands)Number
of
Securities
Unrealized
(Losses)
Fair
Value
Number
of
Securities
Unrealized
(Losses)
Fair
Value
Unrealized
(Losses)
Fair
Value
AFS investment securities
U.S. Treasury securities— $— $— $(14,563)$109,954 $(14,563)$109,954 
Agency securities— — — (1,483)13,517 (1,483)13,517 
Obligations of state and political subdivisions (municipal securities)285 (3,452)155,382 79 (2,063)43,862 (5,515)199,244 
Residential mortgage-related securities:
FNMA/FHLMC26 (899)33,479 100 (212,366)1,473,501 (213,265)1,506,980 
GNMA60 (14,873)1,074,681 13 (3,887)56,951 (18,761)1,131,632 
Commercial mortgage-related securities:
FNMA/FHLMC— — — (1,772)17,095 (1,772)17,095 
GNMA11 (3,539)110,951 31 (4,745)72,395 (8,284)183,346 
Asset backed securities:
FFELP— — — 15 (4,211)140,166 (4,211)140,166 
SBA— 740 (47)1,754 (47)2,493 
Other debt securities(15)985 (72)1,928 (87)2,913 
Total385 $(22,779)$1,376,217 256 $(245,208)$1,931,121 $(267,987)$3,307,339 
HTM investment securities
U.S. Treasury securities— $— $— $(59)$940 $(59)$940 
Obligations of state and political subdivisions (municipal securities)485 (12,109)650,323 444 (150,479)647,004 (162,587)1,297,327 
Residential mortgage-related securities:
FNMA/FHLMC64 (2,536)65,400 57 (169,313)761,207 (171,849)826,607 
GNMA21 (330)14,665 63 (3,171)31,369 (3,500)46,034 
Private-label— — — 18 (72,395)293,782 (72,395)293,782 
 Commercial mortgage-related securities:
FNMA/FHLMC(1,212)28,920 41 (173,730)594,472 (174,942)623,393 
GNMA— — — 13 (7,946)55,477 (7,946)55,477 
Total574 $(16,186)$759,309 637 $(577,092)$2,384,250 $(593,278)$3,143,559 
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For comparative purposes, the following represents gross unrealized losses and the related fair value of AFS and HTM securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2022:
 Less than 12 months12 months or moreTotal
($ in thousands)Number
of
Securities
Unrealized
(Losses)
Fair
Value
Number
of
Securities
Unrealized
(Losses)
Fair
Value
Unrealized
(Losses)
Fair
Value
AFS investment securities
U.S. Treasury securities— $— $— $(15,063)$109,378 $(15,063)$109,378 
Agency securities— — — (1,468)13,532 (1,468)13,532 
Obligations of state and political subdivisions (municipal securities)358 (5,066)201,260 (8)1,916 (5,074)203,176 
Residential mortgage-related securities:
FNMA/FHLMC24 (31,266)260,986 84 (185,170)1,321,420 (216,436)1,582,406 
GNMA23 (4,415)220,276 (840)11,096 (5,255)231,372 
Commercial mortgage-related securities:
FNMA/FHLMC(1,896)17,142 — — — (1,896)17,142 
GNMA33 (3,920)101,036 (649)9,426 (4,569)110,462 
Asset backed securities:
FFELP(1,668)44,304 12 (4,278)106,887 (5,947)151,191 
SBA(1)417 (50)2,057 (51)2,474 
Other debt securities(30)1,970 (49)951 (78)2,922 
Total446 $(48,263)$847,391 121 $(207,575)$1,576,665 $(255,837)$2,424,055 
HTM investment securities
U.S. Treasury securities$(62)$936 — $— $— $(62)$936 
Obligations of state and political subdivisions (municipal securities)771 (96,282)1,079,216 156 (86,415)231,022 (182,697)1,310,238 
Residential mortgage-related securities:
FNMA/FHLMC79 (18,925)143,201 22 (156,836)671,570 (175,760)814,770 
GNMA81 (3,436)44,476 — — — (3,436)44,476 
Private-label(9,509)58,733 15 (63,411)244,772 (72,920)303,505 
Commercial mortgage-related securities:
FNMA/FHLMC(3,814)20,338 39 (174,467)576,911 (178,281)597,249 
GNMA(2,528)34,612 (4,726)28,080 (7,254)62,691 
Total947 $(134,556)$1,381,511 238 $(485,855)$1,752,354 $(620,411)$3,133,865 
The Corporation reviews the AFS investment securities portfolio on a quarterly basis to monitor its credit exposure. A determination as to whether a security’s decline in fair value is the result of credit risk takes into consideration numerous factors and the relative significance of any single factor can vary by security. Some factors the Corporation may consider in this impairment analysis include the extent to which the security has been in an unrealized loss position, the change in security rating, financial condition and near-term prospects of the issuer, as well as the security and industry specific economic conditions.
Based on the Corporation’s evaluation, management does not believe any unrealized losses at June 30, 2023 represent credit deterioration as these unrealized losses are primarily attributable to changes in interest rates and the current market conditions. The Corporation does not intend to sell, nor does it believe that it will be required to sell, the securities in an unrealized loss position before recovery of their amortized cost basis.
FHLB and Federal Reserve Bank stocks: The Corporation is required to maintain Federal Reserve Bank stock and FHLB stock as a member bank of both the Federal Reserve System and the FHLB, and in amounts as required by these institutions. These equity securities are “restricted” in that they can only be sold back to the respective institutions or another member institution at par. Therefore, they are less liquid than other marketable equity securities and their fair value is equal to amortized cost. The Corporation had FHLB stock of $185 million and $209 million at June 30, 2023 and December 31, 2022, respectively. The Corporation had Federal Reserve Bank stock of $87 million at both June 30, 2023 and December 31, 2022. Accrued interest receivable on FHLB stock totaled $3 million at both June 30, 2023 and December 31, 2022. There was no accrued interest receivable on Federal Reserve Bank Stock at both June 30, 2023, and December 31, 2022. Accrued interest receivable on both FHLB stock and Federal Reserve Bank stock is included in interest receivable on the consolidated balance sheets.
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Equity Securities
Equity securities with readily determinable fair values: The Corporation's portfolio of equity securities with readily determinable fair values is primarily comprised of CRA Qualified Investment mutual funds and other mutual funds. The Corporation had equity securities with readily determinable fair values of $7 million at June 30, 2023 and $6 million at December 31, 2022.
Equity securities without readily determinable fair values: The Corporation's portfolio of equity securities without readily determinable fair values, which primarily consists of Visa Class B restricted shares and an investment in a private SBA loan fund, was carried at $24 million and $19 million at June 30, 2023 and December 31, 2022, respectively.
Note 6 Loans
The period end loan composition was as follows:
($ in thousands)Jun 30, 2023Dec 31, 2022
Commercial and industrial$10,055,487 $9,759,454 
Commercial real estate — owner occupied1,058,237 991,722 
Commercial and business lending11,113,724 10,751,176 
Commercial real estate — investor5,312,928 5,080,344 
Real estate construction2,009,060 2,155,222 
Commercial real estate lending7,321,988 7,235,565 
Total commercial18,435,711 17,986,742 
Residential mortgage8,746,345 8,511,550 
Auto finance1,777,974 1,382,073 
Home equity615,506 624,353 
Other consumer273,367 294,851 
Total consumer11,413,193 10,812,828 
Total loans$29,848,904 $28,799,569 
Accrued interest receivable on loans totaled $124 million at June 30, 2023, and $113 million at December 31, 2022, and is included in interest receivable on the consolidated balance sheets. Interest accrued but not received for loans placed on nonaccrual is reversed against interest income. The amount of accrued interest reversed was $1 million for the three and six months ended June 30, 2023, and immaterial for the three and six months ended June 30, 2022.

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The following table presents loans by credit quality indicator by origination year at June 30, 2023:
Term Loans Amortized Cost Basis by Origination Year(a)
($ in thousands)
Rev Loans Converted to Term(a)
Rev Loans Amortized Cost BasisYTD 20232022202120202019PriorTotal
Commercial and industrial:
Risk rating:
Pass$375 $2,016,151 $894,287 $3,101,942 $2,118,259 $450,305 $489,900 $617,543 $9,688,387 
Special mention57 44,943 57 35,706 9,319 6,240 — 30,700 126,964 
Potential problem642 89,637 873 19,850 73,809 20,187 91 781 205,228 
Nonaccrual10,583 — 3,230 16,863 6,457 8,357 — — 34,907 
Commercial and industrial$11,657 $2,150,731 $898,447 $3,174,361 $2,207,845 $485,088 $489,991 $649,023 $10,055,487 
Commercial real estate - owner occupied:
Risk rating:
Pass$— $19,693 $132,242 $209,736 $230,821 $147,000 $147,706 $127,909 $1,015,108 
Special mention— 579 — — — 3,434 8,276 — 12,289 
Potential problem— — 2,656 864 9,052 4,002 500 12,322 29,396 
Nonaccrual— — 1,444 — — — — — 1,444 
Commercial real estate - owner occupied$— $20,272 $136,342 $210,600 $239,873 $154,436 $156,482 $140,231 $1,058,237 
Commercial and business lending:
Risk rating:
Pass$375 $2,035,845 $1,026,529 $3,311,678 $2,349,081 $597,305 $637,606 $745,452 $10,703,495 
Special mention57 45,522 57 35,706 9,319 9,673 8,276 30,700 139,253 
Potential problem642 89,637 3,528 20,714 82,861 24,190 592 13,103 234,624 
Nonaccrual10,583 — 4,675 16,863 6,457 8,357 — — 36,352 
Commercial and business lending$11,657 $2,171,004 $1,034,789 $3,384,961 $2,447,717 $639,524 $646,474 $789,254 $11,113,724 
Commercial real estate - investor:
Risk rating:
Pass$— $131,996 $610,875 $1,549,321 $1,339,075 $637,693 $435,601 $386,283 $5,090,844 
Special mention— — 15,259 52,277 25,817 — — — 93,353 
Potential problem— — 24,842 21,538 31,398 8,225 1,008 19,650 106,662 
Nonaccrual— — — — 21,801 — — 267 22,068 
Commercial real estate - investor$— $131,996 $650,976 $1,623,135 $1,418,092 $645,919 $436,609 $406,200 $5,312,928 
Real estate construction:
Risk rating:
Pass$— $30,596 $107,275 $1,037,825 $680,661 $123,350 $6,947 $9,974 $1,996,627 
Special mention— — — — — 12,308 — — 12,308 
Nonaccrual— — — — — — — 125 125 
Real estate construction$— $30,596 $107,275 $1,037,825 $680,661 $135,658 $6,947 $10,099 $2,009,060 
Commercial real estate lending:
Risk rating:
Pass$— $162,592 $718,150 $2,587,145 $2,019,736 $761,044 $442,548 $396,257 $7,087,472 
Special mention— — 15,259 52,277 25,817 12,308 — — 105,661 
Potential problem— — 24,842 21,538 31,398 8,225 1,008 19,650 106,662 
Nonaccrual— — — — 21,801 — — 392 22,193 
Commercial real estate lending$— $162,592 $758,251 $2,660,960 $2,098,753 $781,577 $443,556 $416,299 $7,321,988 
Total commercial:
Risk rating:
Pass$375 $2,198,437 $1,744,679 $5,898,823 $4,368,817 $1,358,348 $1,080,154 $1,141,709 $17,790,967 
Special mention57 45,522 15,316 87,983 35,136 21,981 8,276 30,700 244,914 
Potential problem642 89,637 28,370 42,252 114,259 32,415 1,600 32,753 341,286 
Nonaccrual10,583 — 4,675 16,863 28,258 8,357 — 392 58,544 
Total commercial$11,657 $2,333,596 $1,793,040 $6,045,921 $4,546,470 $1,421,101 $1,090,030 $1,205,553 $18,435,711 
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Term Loans Amortized Cost Basis by Origination Year(a)
($ in thousands)
Rev Loans Converted to Term(a)
Rev Loans Amortized Cost BasisYTD 20232022202120202019PriorTotal
Residential mortgage:
Risk rating:
Pass$— $— $224,502 $1,629,017 $2,226,398 $1,651,621 $766,715 $2,184,280 $8,682,533 
Special mention— — — — 278 — — 170 448 
Potential problem— — 109 173 613 — 547 205 1,646 
Nonaccrual— — 605 6,204 4,738 8,236 6,424 35,511 61,718 
Residential mortgage$— $— $225,216 $1,635,393 $2,232,027 $1,659,856 $773,686 $2,220,166 $8,746,345 
Auto finance:
Risk rating:
Pass$— $— $565,583 $1,115,791 $90,632 $240 $778 $289 $1,773,314 
Special mention— — 181 1,330 84 — — — 1,596 
Nonaccrual— — 44 2,323 689 — — 3,065 
Auto finance$— $— $565,808 $1,119,445 $91,405 $240 $787 $289 $1,777,974 
Home equity:
Risk rating:
Pass$4,681 $504,626 $365 $30,687 $6,819 $2,220 $5,351 $56,666 $606,734 
Special mention276 94 — — — 99 — 552 744 
Potential problem13 — 13 194 — — 34 — 240 
Nonaccrual457 113 — 353 106 119 295 6,802 7,788 
Home equity$5,426 $504,833 $377 $31,234 $6,925 $2,438 $5,680 $64,020 $615,506 
Other consumer:
Risk rating:
Pass$198 $187,462 $3,950 $4,696 $3,424 $1,690 $704 $70,631 $272,559 
Special mention25 547 — 28 33 — 36 646 
Nonaccrual23 46 — 10 25 12 64 163 
Other consumer$246 $188,055 $3,950 $4,734 $3,451 $1,729 $717 $70,732 $273,367 
Total consumer:
Risk rating:
Pass$4,879 $692,088 $794,400 $2,780,192 $2,327,273 $1,655,771 $773,549 $2,311,866 $11,335,139 
Special mention301 640 181 1,358 364 131 — 758 3,434 
Potential problem13 — 122 367 613 — 580 205 1,886 
Nonaccrual480 159 649 8,890 5,557 8,360 6,741 42,378 72,733 
Total consumer$5,673 $692,887 $795,352 $2,790,806 $2,333,808 $1,664,262 $780,870 $2,355,207 $11,413,193 
Total loans:
Risk rating:
Pass$5,254 $2,890,525 $2,539,079 $8,679,015 $6,696,090 $3,014,119 $1,853,703 $3,453,575 $29,126,106 
Special mention357 46,162 15,497 89,341 35,500 22,113 8,276 31,458 248,348 
Potential problem655 89,637 28,492 42,619 114,872 32,415 2,180 32,958 343,173 
Nonaccrual11,063 159 5,324 25,753 33,816 16,717 6,741 42,769 131,278 
Total loans$17,329 $3,026,483 $2,588,392 $8,836,728 $6,880,278 $3,085,363 $1,870,900 $3,560,760 $29,848,904 
(a) Revolving loans converted to term loans are those converted during the reporting period and are also reported in their year of origination.


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The following table presents loans by credit quality indicator by origination year at December 31, 2022:
Term Loans Amortized Cost Basis by Origination Year(a)
($ in thousands)
Rev Loans Converted to Term(a)
Rev Loans Amortized Cost Basis20222021202020192018PriorTotal
Commercial and industrial:
Risk rating:
Pass$1,423 $1,938,777 $3,245,546 $2,367,008 $567,833 $573,120 $330,642 $432,906 $9,455,833 
Special mention— 93,209 3,411 23,607 — — 19 32,497 152,744 
Potential problem447 24,549 41,400 4,193 21,887 38,169 218 6,133 136,549 
Nonaccrual3,926 — 5,210 — 9,119 — — — 14,329 
Commercial and industrial$5,796 $2,056,535 $3,295,567 $2,394,809 $598,839 $611,289 $330,879 $471,535 $9,759,454 
Commercial real estate - owner occupied:
Risk rating:
Pass$— $12,447 $211,645 $225,627 $163,965 $160,370 $73,487 $97,420 $944,961 
Special mention— — — — 1,136 1,491 9,713 — 12,339 
Potential problem— 1,325 1,238 11,141 5,523 10,769 370 4,055 34,422 
Commercial real estate - owner occupied$— $13,772 $212,883 $236,769 $170,624 $172,630 $83,570 $101,475 $991,722 
Commercial and business lending:
Risk rating:
Pass$1,423 $1,951,224 $3,457,191 $2,592,636 $731,798 $733,490 $404,129 $530,326 $10,400,794 
Special mention— 93,209 3,411 23,607 1,136 1,491 9,732 32,497 165,083 
Potential problem447 25,874 42,638 15,335 27,410 48,938 589 10,188 170,971 
Nonaccrual3,926 — 5,210 — 9,119 — — — 14,329 
Commercial and business lending$5,796 $2,070,307 $3,508,450 $2,631,578 $769,463 $783,919 $414,449 $573,010 $10,751,176 
Commercial real estate - investor:
Risk rating:
Pass$38,412 $106,280 $1,633,094 $1,419,000 $683,121 $530,444 $262,858 $210,299 $4,845,096 
Special mention— — 61,968 24,149 7,361 9,400 — 10,455 113,333 
Potential problem— — 16,147 21,303 27,635 1,333 19,017 7,099 92,535 
Nonaccrual— — 2,177 25,668 — — — 1,535 29,380 
Commercial real estate - investor$38,412 $106,280 $1,713,387 $1,490,120 $718,117 $541,177 $281,875 $229,387 $5,080,344 
Real estate construction:
Risk rating:
Pass$— $29,892 $900,593 $913,107 $241,230 $12,062 $2,226 $9,775 $2,108,885 
Special mention— — — — 12,174 33,087 — — 45,261 
Potential problem— — — — 970 — — — 970 
Nonaccrual— — — — — <