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EX-31.2 - EXHIBIT 31.2 - SYNOVUS FINANCIAL CORPsnv-03312017xex312.htm
EX-32 - EXHIBIT 32 - SYNOVUS FINANCIAL CORPsnv-03312017xex32.htm
EX-31.1 - EXHIBIT 31.1 - SYNOVUS FINANCIAL CORPsnv-03312017xex311.htm
EX-12.1 - EXHIBIT 12.1 - SYNOVUS FINANCIAL CORPsnv-0331x2017xex121.htm
EX-10.1 - EXHIBIT 10.1 - SYNOVUS FINANCIAL CORPsnv-03312017xex101.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________
 
FORM 10-Q
 
______________________________
Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended March 31, 2017
Commission file number 1-10312
 
______________________________
financialappendix930a16.jpg
SYNOVUS FINANCIAL CORP.
(Exact name of registrant as specified in its charter)
______________________________
 
Georgia
 
58-1134883
(State or other jurisdiction of incorporation or organization)
 
   (I.R.S. Employer Identification No.)
1111 Bay Avenue
Suite 500, Columbus, Georgia
 
31901
(Address of principal executive offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (706) 649-2311
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Name of each exchange on which registered
Common Stock, $1.00 Par Value
Series B Participating Cumulative Preferred Stock Purchase Rights
Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C
New York Stock Exchange
New York Stock Exchange
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: NONE
______________________________
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 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 x  NO ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).   YES x  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” and “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check One):
Large accelerated filer
x
Accelerated filer
¨
 
 
 
 
Non-accelerated filer
¨ (Do not check if a smaller reporting company)
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 7(a)2(B) of the Securities Act.  ¨ 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ¨    NO x
Indicate the number of shares outstanding of each of the issuer’s class of common stock, as of the latest practicable date.
Class
 
 
 
April 28, 2017

Common Stock, $1.00 Par Value
 
 
 
122,356,991





Table of Contents
 
 
 
 
 
Page
Financial Information
 
 
 
Index of Defined Terms
 
Item 1.
Financial Statements (Unaudited)
 
 
 
Consolidated Balance Sheets as of March 31, 2017 and December 31, 2016
 
 
Consolidated Statements of Income for the Three Months Ended March 31, 2017 and 2016
 
 
Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2017 and 2016
 
 
Consolidated Statements of Changes in Shareholders' Equity for the Three Months Ended March 31, 2017 and 2016
 
 
Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2017 and 2016
 
 
Notes to Unaudited Interim Consolidated Financial Statements
 
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
 
Item 3.
 
Item 4.
Controls and Procedures
 
 
 
 
 
Other Information
 
 
Item 1.
Legal Proceedings
 
Item 1A.
Risk Factors
 
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
 
Item 3.
Defaults Upon Senior Securities
 
Item 4.
Mine Safety Disclosures
 
Item 5.
Other Information
 
Item 6.
Exhibits
 
Signatures
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 






SYNOVUS FINANCIAL CORP.
INDEX OF DEFINED TERMS
ALCO – Synovus' Asset Liability Management Committee
ASC – Accounting Standards Codification
ASU – Accounting Standards Update
ATM – Automatic teller machine
Basel III – A global regulatory framework developed by the Basel Committee on Banking Supervision
BOLI – Bank-Owned Life Insurance
BOV – Broker’s opinion of value
bp – Basis point (bps - basis points)
C&I – Commercial and industrial loans
CCC – Central clearing counterparty
CET1 – Common Equity Tier 1 Capital defined by Basel III capital rules
CMO – Collateralized Mortgage Obligation
Code – Internal Revenue Code of 1986, as amended
Company – Synovus Financial Corp. and its wholly-owned subsidiaries, except where the context requires otherwise
Covered Litigation – Certain Visa litigation for which Visa is indemnified by Visa USA members
CRE – Commercial real estate
DIF – Deposit Insurance Fund
Dodd-Frank Act – The Dodd-Frank Wall Street Reform and Consumer Protection Act
EVE – economic value of equity
Exchange Act – Securities Exchange Act of 1934, as amended
FASB – Financial Accounting Standards Board
FDIC – Federal Deposit Insurance Corporation
Federal Reserve Bank – The 12 banks that are the operating arms of the U.S. central bank. They implement the policies of the Federal Reserve Board and also conduct economic research.
Federal Reserve Board – The 7-member Board of Governors that oversees the Federal Reserve System, establishes monetary policy, and monitors the economic health of the country. Its members are appointed by the President, subject to Senate confirmation, and serve 14-year terms.
Federal Reserve System – The 12 Federal Reserve Banks, with each one serving member banks in its own district. This system, supervised by the Federal Reserve Board, has broad regulatory powers over the money supply and the credit structure.
FFIEC – Federal Financial Institutions Examination Council
FHLB – Federal Home Loan Bank
FICO – Fair Isaac Corporation
GA DBF – Georgia Department of Banking and Finance
GAAP – Generally Accepted Accounting Principles in the United States of America
GGL – government guaranteed loans
Global One – Entaire Global Companies, Inc., the parent company of Global One Financial, Inc., as acquired by Synovus on October 1, 2016. Throughout this Report, we refer to this acquisition as "Global One."
HELOC – Home equity line of credit

i


LIBOR – London Interbank Offered Rate
LTV – Loan-to-collateral value ratio
NAICS – North American Industry Classification System
nm – not meaningful
NPA – Non-performing assets
NPL – Non-performing loans
NSF – Non-sufficient funds
OCI – Other comprehensive income
ORE – Other real estate
OTTI – Other-than-temporary impairment
Parent Company – Synovus Financial Corp.
SBA – Small Business Administration
SCM – State, county, and municipal
SEC – U.S. Securities and Exchange Commission
Securities Act – Securities Act of 1933, as amended
Series C Preferred Stock – Synovus' Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C, $25 liquidation preference
Synovus – Synovus Financial Corp.
Synovus Bank – A Georgia state-chartered bank and wholly-owned subsidiary of Synovus through which Synovus conducts its banking operations
Synovus' 2016 Form 10-K – Synovus' Annual Report on Form 10-K for the year ended December 31, 2016
Synovus Mortgage – Synovus Mortgage Corp., a wholly-owned subsidiary of Synovus Bank
Synovus Trust – Synovus Trust Company, N.A., a wholly-owned subsidiary of Synovus Bank
TDR – Troubled debt restructuring (as defined in ASC 310-40)
Treasury – United States Department of the Treasury
VIE – Variable interest entity, as defined in ASC 810-10
Visa – The Visa U.S.A., Inc. card association or its affiliates, collectively
Visa Class B shares – Class B shares of common stock issued by Visa which are subject to restrictions with respect to sale until all of the Covered Litigation has been settled
Visa Derivative – A derivative contract with the purchaser of Visa Class B shares which provides for settlements between the purchaser and Synovus based upon a change in the ratio for conversion of Visa Class B shares into Visa Class A shares
Warrant – A warrant issued to the Treasury by Synovus to purchase up to 2,215,820 shares of Synovus common stock at a per share exercise price of $65.52 expiring on December 19, 2018, as was issued by Synovus to Treasury in 2008 in connection with the Capital Purchase Program, promulgated under the Emergency Stabilization Act of 2008


ii



PART I. FINANCIAL INFORMATION
ITEM 1. - FINANCIAL STATEMENTS
SYNOVUS FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except share and per share data)
March 31, 2017
 
December 31, 2016
ASSETS
 
 
 
Cash and cash equivalents
$
380,493

 
395,175

Interest bearing funds with Federal Reserve Bank
622,460

 
527,090

Interest earning deposits with banks
24,259

 
18,720

Federal funds sold and securities purchased under resale agreements
50,003

 
58,060

Trading account assets, at fair value
1,778

 
9,314

Mortgage loans held for sale, at fair value
57,686

 
51,545

Investment securities available for sale, at fair value
3,782,942

 
3,718,195

Loans, net of deferred fees and costs
24,258,468

 
23,856,391

Allowance for loan losses
(253,514
)
 
(251,758
)
Loans, net
$
24,004,954

 
23,604,633

Premises and equipment, net
412,725

 
417,485

Goodwill
57,010

 
59,678

Other intangible assets
12,137

 
13,223

Other real estate
20,425

 
22,308

Deferred tax asset, net
359,121

 
395,356

Other assets
893,596

 
813,220

Total assets
$
30,679,589

 
30,104,002

LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
Liabilities
 
 
 
Deposits:
 
 
 
Non-interest bearing deposits
$
7,264,856

 
7,085,804

Interest bearing deposits, excluding brokered deposits
16,452,703

 
16,183,273

Brokered deposits
1,388,153

 
1,378,983

Total deposits
25,105,712

 
24,648,060

Federal funds purchased and securities sold under repurchase agreements
146,480

 
159,699

Long-term debt
2,160,867

 
2,160,881

Other liabilities
304,403

 
207,438

Total liabilities
$
27,717,462

 
27,176,078

Shareholders' Equity
 
 
 
Series C Preferred Stock – no par value. Authorized 100,000,000 shares; 5,200,000 shares issued and outstanding at March 31, 2017 and December 31, 2016
$
125,980

 
125,980

Common stock - $1.00 par value. Authorized 342,857,143 shares; 142,441,418 issued at March 31, 2017 and 142,025,720 issued at December 31, 2016; 122,321,804 outstanding at March 31, 2017 and 122,266,106 outstanding at December 31, 2016
142,441

 
142,026

Additional paid-in capital
3,025,775

 
3,028,405

Treasury stock, at cost – 20,119,614 shares at March 31, 2017 and 19,759,614 shares at December 31, 2016
(679,746
)
 
(664,595
)
Accumulated other comprehensive loss
(54,751
)
 
(55,659
)
Retained earnings
402,428

 
351,767

Total shareholders’ equity
2,962,127

 
2,927,924

Total liabilities and shareholders' equity
$
30,679,589

 
30,104,002

 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

1


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
 
Three Months Ended March 31,
(in thousands, except per share data)
2017
 
2016
Interest income:
 
 
 
      Loans, including fees
$
249,348

 
229,917

      Investment securities available for sale
19,834

 
16,972

      Trading account assets
28

 
22

      Mortgage loans held for sale
467

 
588

      Federal Reserve Bank balances
1,211

 
999

      Other earning assets
1,513

 
825

Total interest income
272,401

 
249,323

Interest expense:
 
 
 
Deposits
16,958

 
16,015

Federal funds purchased and securities sold under repurchase agreements
38

 
45

Long-term debt
15,478

 
15,070

Total interest expense
32,474

 
31,130

Net interest income
239,927

 
218,193

Provision for loan losses
8,674

 
9,377

Net interest income after provision for loan losses
231,253

 
208,816

Non-interest income:
 
 
 
Service charges on deposit accounts
19,774

 
19,710

Fiduciary and asset management fees
12,151

 
11,274

Brokerage revenue
7,226

 
6,483

Mortgage banking income
5,766

 
5,484

Bankcard fees
8,185

 
8,372

Investment securities gains, net
7,668

 
67

Decrease in fair value of private equity investments, net
(1,814
)
 
(391
)
Other fee income
4,868

 
4,804

Other non-interest income
8,015

 
7,344

Total non-interest income
71,839

 
63,147

Non-interest expense:
 
 
 
Salaries and other personnel expense
107,191

 
101,358

Net occupancy and equipment expense
29,331

 
26,577

Third-party processing expense
12,603

 
11,116

FDIC insurance and other regulatory fees
6,770

 
6,719

Professional fees
5,355

 
6,369

Advertising expense
5,912

 
2,410

Foreclosed real estate expense, net
2,134

 
2,684

Merger-related expense
86

 

Loss on early extinguishment of debt, net

 
4,735

Fair value adjustment to Visa derivative

 
360

Restructuring charges, net
6,511

 
1,140

Other operating expenses
21,495

 
24,765

Total non-interest expense
197,388

 
188,233

Income before income taxes
105,704

 
83,730

Income tax expense
33,847

 
31,199

Net income
71,857

 
52,531

Dividends on preferred stock
2,559

 
2,559

Net income available to common shareholders
$
69,298

 
49,972

Net income per common share, basic
$
0.57

 
0.39

Net income per common share, diluted
0.56

 
0.39

Weighted average common shares outstanding, basic
122,300

 
127,227

Weighted average common shares outstanding, diluted
123,059

 
127,857

 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

2


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
 
Three Months Ended March 31,
 
2017
 
2016
(in thousands)
Before-tax Amount
 
Tax (Expense) Benefit
 
Net of Tax Amount
 
Before-tax Amount
 
Tax (Expense) Benefit
 
Net of Tax Amount
Net income
$
105,704

 
(33,847
)
 
71,857

 
83,730

 
(31,199
)
 
52,531

Net change related to cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for losses realized in net income
65

 
(25
)
 
40

 
273

 
(105
)
 
168

Net unrealized gains on investment securities available for sale:


 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for net gains realized in net income
(7,668
)
 
2,952

 
(4,716
)
 
(67
)
 
26

 
(41
)
Net unrealized gains arising during the period
9,099

 
(3,503
)
 
5,596

 
47,172

 
(18,162
)
 
29,010

Net unrealized gains
1,431

 
(551
)
 
880

 
47,105

 
(18,136
)
 
28,969

Post-retirement unfunded health benefit:
 
 
 
 
 
 
 
 
 
 
 
Reclassification adjustment for gains realized in net income
(20
)
 
8

 
(12
)
 
(94
)
 
36

 
(58
)
Actuarial gains arising during the period

 



 

 

 

Net unrealized (realized) gains
$
(20
)
 
8

 
(12
)
 
(94
)
 
36

 
(58
)
Other comprehensive income
$
1,476

 
(568
)
 
908

 
47,284

 
(18,205
)
 
29,079

Comprehensive income
 
 
 
 
$
72,765

 
 
 
 
 
81,610

 
 
 
 
 
 
 
 
 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

3


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited)
(in thousands, except per share data)
Series C Preferred Stock
 
Common
Stock
 
Additional
Paid-in
Capital
 
Treasury
Stock
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Retained Earnings
 
Total
Balance at December 31, 2015
$
125,980

 
140,592

 
2,989,981

 
(401,511
)
 
(29,819
)
 
174,973

 
3,000,196

Net income

 

 

 

 

 
52,531

 
52,531

Other comprehensive income, net of income taxes

 

 

 

 
29,079

 

 
29,079

Cash dividends declared on common stock -$0.12 per share

 

 

 

 

 
(15,069
)
 
(15,069
)
Cash dividends paid on Series C Preferred Stock

 

 

 

 

 
(2,559
)
 
(2,559
)
Repurchases of common stock

 

 


 
(110,985
)
 

 

 
(110,985
)
Restricted share unit activity

 
175

 
(2,993
)
 

 

 

 
(2,818
)
Stock options exercised

 
27

 
429

 

 

 

 
456

Share-based compensation net tax deficiency

 

 
(900
)
 

 

 

 
(900
)
Share-based compensation expense

 

 
3,337

 

 

 

 
3,337

Balance at March 31, 2016
$
125,980

 
140,794

 
2,989,854

 
(512,496
)
 
(740
)
 
209,876

 
2,953,268

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at December 31, 2016
$
125,980

 
142,026

 
3,028,405

 
(664,595
)
 
(55,659
)
 
351,767

 
2,927,924

Net income

 

 

 

 

 
71,857

 
71,857

Other comprehensive income, net of income taxes

 

 

 

 
908

 

 
908

Cash dividends declared on common stock - $0.15 per share

 

 

 

 

 
(18,347
)
 
(18,347
)
Cash dividends paid on Series C Preferred Stock

 

 

 

 

 
(2,559
)
 
(2,559
)
Repurchases of common stock

 

 

 
(15,151
)
 

 

 
(15,151
)
Restricted share unit activity

 
305

 
(7,799
)
 

 

 
(290
)
 
(7,784
)
Stock options exercised

 
110

 
1,809

 

 

 

 
1,919

Share-based compensation expense

 

 
3,360

 

 

 

 
3,360

Balance at March 31, 2017
$
125,980

 
$
142,441

 
3,025,775

 
(679,746
)
 
(54,751
)
 
402,428

 
2,962,127

 
 
 
 
 
 
 
 
 
 
 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

4


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
 
Three Months Ended March 31,
(in thousands)
2017
 
2016
Operating Activities
 
 
 
Net income
$
71,857

 
52,531

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Provision for loan losses
8,674

 
9,377

Depreciation, amortization, and accretion, net
14,479

 
13,785

Deferred income tax expense
36,014

 
28,601

Decrease in trading account assets
7,536

 
296

Originations of mortgage loans held for sale
(156,043
)
 
(138,695
)
Proceeds from sales of mortgage loans held for sale
155,245

 
138,677

Gain on sales of mortgage loans held for sale, net
(3,560
)
 
(3,424
)
Increase in other assets
(1,875
)
 
(38,484
)
Increase in other liabilities
4,963

 
17,341

Investment securities gains, net
(7,668
)
 
(67
)
Losses and write-downs on other real estate, net
1,790

 
2,098

Decrease in fair value of private equity investments, net
1,814

 
391

Loss on early extinguishment of debt, net

 
4,735

Share-based compensation expense
3,360

 
3,337

Net cash provided by operating activities
$
136,586

 
90,499

Investing Activities
 
 
 
Net increase in interest earning deposits with banks
(5,539
)
 
(4,299
)
Net decrease (increase) in federal funds sold and securities purchased under resale agreements
8,057

 
(6,481
)
Net increase in interest bearing funds with Federal Reserve Bank
(95,370
)
 
(78,640
)
Proceeds from maturities and principal collections of investment securities available for sale
163,386

 
168,039

Proceeds from sales of investment securities available for sale
282,629

 
243,609

Purchases of investment securities available for sale
(410,814
)
 
(363,788
)
Proceeds from sales of loans

 
4,259

Proceeds from sales of other real estate
2,773

 
10,798

Net increase in loans
(419,552
)
 
(344,159
)
Purchases of bank-owned life insurance policies
(75,000
)
 

Net increase in premises and equipment
(5,497
)
 
(7,830
)
Proceeds from sales of other assets held for sale
1,328

 

Net cash used in investing activities
$
(553,599
)
 
(378,492
)
Financing Activities
 
 
 
Net increase in demand and savings deposits
364,517

 
110,837

Net increase in certificates of deposit
92,955

 
96,212

Net (decrease) increase in federal funds purchased and securities sold under repurchase agreements
(13,219
)
 
26,954

Repayments on long-term debt
(275,000
)
 
(830,067
)
Proceeds from issuance of long-term debt
275,000

 
1,000,000

Dividends paid to common shareholders
(18,347
)
 
(15,069
)
Dividends paid to preferred shareholders
(2,559
)
 
(2,559
)
Stock options exercised
1,919

 
456

Repurchases of common stock
(15,151
)
 
(110,985
)
Restricted stock activity
(7,784
)
 
(2,818
)
Net cash provided by financing activities
$
402,331

 
272,961

Decrease in cash and cash equivalents
(14,682
)
 
(15,032
)
Cash and cash equivalents at beginning of period
395,175

 
367,092

Cash and cash equivalents at end of period
$
380,493

 
352,060

 
 
 
 

5


Supplemental Cash Flow Information
 
 
 
Cash paid during the period for:
 
 
 
Income tax payments (refunds), net
$
210

 
(656
)
Interest paid
31,714

 
32,141

Non-cash Activities
 
 
 
Premises and equipment transferred to other assets held for sale

 
4,828

Loans foreclosed and transferred to other real estate
2,679

 
4,328

Loans transferred to other loans held for sale at fair value
8,442

 
3,834

Securities purchased during the period but settled after period-end
94,560

 

 
 
 
 
See accompanying notes to unaudited interim consolidated financial statements.

6



Notes to Unaudited Interim Consolidated Financial Statements
Note 1 - Significant Accounting Policies
Business Operations
The accompanying unaudited interim consolidated financial statements of Synovus Financial Corp. include the accounts of the Parent Company and its consolidated subsidiaries. Synovus Financial Corp. is a financial services company based in Columbus, Georgia. Through its wholly-owned subsidiary, Synovus Bank, a Georgia state-chartered bank that is a member of the Federal Reserve System, the company provides commercial and retail banking in addition to a full suite of specialized products and services including private banking, treasury management, wealth management, premium finance and international banking. Synovus also provides mortgage services, financial planning, and investment advisory services through its wholly-owned subsidiaries, Synovus Mortgage, Synovus Trust, and Synovus Securities, as well as its GLOBALT and Creative Financial Group divisions. These specialized offerings, combined with traditional banking products and services, make Synovus Bank a great choice for retail and commercial customers.
Synovus Bank's 28 locally-branded bank divisions are positioned in some of the highest growth markets in the Southeast, with 248 branches and 327 ATMs in Georgia, Alabama, South Carolina, Florida, and Tennessee.
Basis of Presentation
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions to the SEC Form 10-Q and Article 10 of Regulation S-X; therefore, they do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, comprehensive income, and cash flows in conformity with GAAP. All adjustments consisting of normally recurring accruals that, in the opinion of management, are necessary for a fair presentation of the consolidated financial position and results of operations for the periods covered by this Report have been included. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes appearing in Synovus' 2016 Form 10-K. There have been no significant changes to the accounting policies as disclosed in Synovus' 2016 Form 10-K.
In preparing the unaudited interim consolidated financial statements in accordance with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the respective consolidated balance sheets and the reported amounts of revenues and expenses for the periods presented. Actual results could differ significantly from those estimates.
Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, the fair value of investment securities, the fair value of private equity investments, and contingent liabilities related to legal matters.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and due from banks. At December 31, 2016, $533 thousand of the due from banks balance was restricted as to withdrawal. There were no cash and cash equivalents restricted as to withdrawal at March 31, 2017.
Short-term Investments
Short-term investments consist of interest bearing funds with the Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements. At March 31, 2017 and December 31, 2016, interest bearing funds with the Federal Reserve Bank included $122.6 million and $130.0 million, respectively, on deposit to meet Federal Reserve Bank requirements. Interest earning deposits with banks include $5.5 million and $5.6 million at March 31, 2017 and December 31, 2016, respectively, which are pledged as collateral in connection with certain letters of credit. Federal funds sold include $49.1 million and $56.1 million at March 31, 2017 and December 31, 2016, respectively, which are pledged to collateralize certain derivative financial instruments. Federal funds sold and securities purchased under resale agreements, and federal funds purchased and securities sold under repurchase agreements, generally mature in one day.
Recently Adopted Accounting Standards Updates
During 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 simplifies various aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. This accounting standard update includes a requirement to record all tax effects associated with share-based compensation through the income statement. Previously, tax benefits in excess of compensation cost (“windfalls”) and tax deficiencies (“shortfalls”) were recorded in equity. During the first quarter of 2017, Synovus recognized a $4.1 million income tax benefit from excess tax benefits that occurred between January 1, 2017 and March 31, 2017 from the vesting of restricted share units and exercise of stock options. Synovus had no previously unrecognized excess

7


tax benefits. Additionally, beginning January 1, 2017, Synovus modified the denominator in the diluted earnings per common share calculation under the treasury stock method to exclude future excess tax benefits as part of the assumed proceeds. Synovus elected to retain its existing accounting policy election to estimate award forfeitures.
During 2015, the FASB issued ASU 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes, which became effective January 1, 2017. ASU 2015-17 requires that deferred income tax liabilities and assets be classified as noncurrent in the statement of financial position instead of separating deferred taxes into current and noncurrent amounts. Also, valuation allowances will no longer be classified between current and noncurrent because these allowances will be required to be classified as noncurrent under the new standard. This ASU only impacts classification in the balance sheet, and has no impact on required deferred tax footnote disclosures (i.e., required presentation of “gross” deferred tax assets and “gross” deferred tax liabilities). The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by this ASU. There is no impact to our balance sheet as a result of this standard because Synovus has not historically distinguished deferred taxes on the balance sheet as current vs. non-current.
Reclassifications
Prior periods' consolidated financial statements are reclassified whenever necessary to conform to the current periods' presentation.

Note 2 - Acquisition
On October 1, 2016, Synovus completed its acquisition of all of the outstanding stock of Global One. Prior to its acquisition, Global One was an Atlanta-based private specialty financial services company that lended primarily to commercial entities, with all loans fully collateralized by cash value life insurance policies and/or annuities issued by investment grade life insurance companies. Under the terms of the merger agreement, Synovus acquired Global One for an up-front payment of $30 million, consisting of the issuance of 821 thousand shares of Synovus common stock valued at $26.6 million and $3.4 million in cash, with additional payments to Global One's former shareholders over the next three to five years based on earnings from the Global One business as further discussed below.
The acquisition of Global One constituted a business combination. Accordingly, the assets acquired and liabilities assumed were recorded at their estimated fair values as shown in the following table. The determination of fair value required management to make estimates about discount rates, future expected earnings and cash flows, market conditions, future loan growth, and other future events that are highly subjective in nature and subject to change. These fair value estimates reflect adjustments to the amounts reported as of December 31, 2016, the most significant of which consist of a reduction in recorded goodwill of $2.7 million and a decrease in the estimated fair value of contingent consideration of $2.6 million. Further, these fair value estimates are considered preliminary and are subject to change for up to one year after the closing date of the acquisition as additional information becomes available.

8


Global One
 
October 1, 2016
(in thousands)
 
Fair Value
Assets acquired:
 
 
Cash and due from banks
 
$
9,554

      Commercial and industrial loans(1)
 
357,307

Goodwill(2)
 
32,579

Other intangible assets
 
12,500

Other assets
 
2,742

Total assets acquired
 
$
414,682

Liabilities assumed:
 
 
Notes payable(3)
 
$
358,560

Contingent consideration
 
11,421

Deferred tax liability, net
 
2,798

Other liabilities
 
11,903

Total liabilities assumed
 
$
384,682

Consideration paid
 
$
30,000

 
 
 
Cash paid
 
$
3,408

Fair value of common stock issued
 
26,592

 
 
 
(1) The unpaid principal balance of the loans was $356.7 million.  
(2) The goodwill is not expected to be deductible for tax purposes.
(3) The unpaid principal balance of the notes payable was $357.0 million.
Under the terms of the merger agreement, the purchase price includes additional annual payments ("Earnout Payments") to Global One's former shareholders over the next three to five years, with amounts based on a percentage of net income attributable to "Global One Earnings," as defined in the merger agreement. The Earnout Payments will consist of shares of Synovus common stock as well as a smaller cash consideration component.
Other intangible assets consist of existing borrower relationships (11 years useful life), trade name (10 years useful life), and distribution network (8 years useful life).
The following is a description of the methods used to determine the fair values of significant assets and liabilities:
Commercial and industrial loans: The fair value of loans was determined based on a discounted cash flow approach. The most significant assumptions used in the valuation of the loan portfolio consisted of the prepayment rate, the probability of extension at maturity, the interest rates on extended loans, and the discount rates. All loans are fully collateralized by cash value life insurance policies and/or annuities issued by investment grade insurance companies. Based on a history of no principal losses on the loan portfolio since inception as well as the collateral position, no losses were estimated in the event of default.
Notes payable: The notes payable were extinguished immediately after the closing of the acquisition. Accordingly, the fair value of notes payable was determined based on the amounts paid to extinguish such notes, inclusive of applicable prepayment penalties, which is consistent with the perspective of a market participant.
Contingent consideration: The fair value of the contingent consideration, which represents the fair value of the above referenced Earnout Payments, was determined based on option pricing methods and a Monte Carlo simulation. The most significant assumptions used in the valuation of the contingent consideration were the expected cash flows, volatility, and discount rates. Future changes in the fair value of the contingent consideration will be recognized in earnings until the contingent consideration arrangement is settled.
Note 3 - Share Repurchase Program
Synovus' Board of Directors authorized a $200 million share repurchase program that will expire at the end of 2017. This program was announced on January 17, 2017. As of March 31, 2017, Synovus had repurchased a total of $15.1 million or 360 thousand shares at an average price of $42.06 per share under the $200 million share repurchase program.



Note 4 - Investment Securities
The amortized cost, gross unrealized gains and losses, and estimated fair values of investment securities available for sale at March 31, 2017 and December 31, 2016 are summarized below.
 
 
March 31, 2017
(in thousands)
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
 Fair Value
U.S. Treasury securities
 
$
83,441

 

 
(550
)
 
82,891

U.S. Government agency securities
 
12,089

 
342

 

 
12,431

Mortgage-backed securities issued by U.S. Government agencies
 
166,794

 
787

 
(1,302
)
 
166,279

Mortgage-backed securities issued by U.S. Government sponsored enterprises
 
2,837,359

 
3,779

 
(38,594
)
 
2,802,544

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
 
710,188

 
12

 
(13,308
)
 
696,892

State and municipal securities
 
1,800

 
1

 

 
1,801

Other investments
 
20,263

 
144

 
(303
)
 
20,104

Total investment securities available for sale
 
$
3,831,934

 
5,065

 
(54,057
)
 
3,782,942

 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
(in thousands)
 
Amortized Cost
 
Gross Unrealized Gains
 
Gross Unrealized Losses
 
Fair Value
U.S. Treasury securities
 
$
108,221

 
225

 
(644
)
 
107,802

U.S. Government agency securities
 
12,727

 
266

 

 
12,993

Mortgage-backed securities issued by U.S. Government agencies
 
174,440

 
1,116

 
(1,354
)
 
174,202

Mortgage-backed securities issued by U.S. Government sponsored enterprises
 
2,543,495

 
5,416

 
(42,571
)
 
2,506,340

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
 
905,789

 
1,214

 
(16,561
)
 
890,442

State and municipal securities
 
2,780

 
14

 

 
2,794

Equity securities
 
919

 
2,863

 

 
3,782

Other investments
 
20,247

 

 
(407
)
 
19,840

Total investment securities available for sale
 
$
3,768,618

 
11,114

 
(61,537
)
 
3,718,195

 
 
 
 
 
 
 
 
 
At March 31, 2017 and December 31, 2016, investment securities with a carrying value of $1.75 billion and $2.04 billion, respectively, were pledged to secure certain deposits and securities sold under repurchase agreements as required by law and contractual agreements.
Synovus has reviewed investment securities that are in an unrealized loss position as of March 31, 2017 and December 31, 2016 for OTTI and does not consider any securities in an unrealized loss position to be other-than-temporarily impaired. If Synovus intended to sell a security in an unrealized loss position, the entire unrealized loss would be reflected in earnings. Synovus does not intend to sell investment securities in an unrealized loss position prior to the recovery of the unrealized loss, which may be until maturity, and has the ability and intent to hold those securities for that period of time. Additionally, Synovus is not currently aware of any circumstances which will require it to sell any of the securities that are in an unrealized loss position prior to the respective securities' recovery of all such unrealized losses.
Declines in the fair value of available for sale securities below their cost that are deemed to have OTTI are reflected in earnings as realized losses to the extent the impairment is related to credit losses. The amount of the impairment related to other factors is recognized in other comprehensive income. Currently, unrealized losses on debt securities are attributable to increases in interest rates on comparable securities from the date of purchase. Synovus regularly evaluates its investment securities portfolio to ensure that there are no conditions that would indicate that unrealized losses represent OTTI. These factors include the length of time the security has been in a loss position, the extent that the fair value is below amortized cost, and the credit standing of the issuer. As of March 31, 2017, Synovus had 90 investment securities in a loss position for less than twelve months and four investment securities in a loss position for twelve months or longer.

10


Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2017 and December 31, 2016 are presented below.
 
March 31, 2017
 
Less than 12 Months
 
12 Months or Longer
 
Total
(in thousands)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
U.S. Treasury securities
$
64,134

 
550

 

 

 
64,134

 
550

Mortgage-backed securities issued by U.S. Government agencies
123,299

 
1,185

 
3,497

 
117

 
126,796

 
1,302

Mortgage-backed securities issued by U.S. Government sponsored enterprises
2,155,464

 
38,594

 

 

 
2,155,464

 
38,594

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
641,126

 
12,420

 
23,723

 
888

 
664,849

 
13,308

Other investments

 

 
4,959

 
303

 
4,959

 
303

    Total
$
2,984,023

 
52,749

 
32,179

 
1,308

 
3,016,202

 
54,057

 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
Less than 12 Months
 
12 Months or Longer
 
Total
(in thousands)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
U.S. Treasury securities
$
64,023

 
644

 

 

 
64,023

 
644

Mortgage-backed securities issued by U.S. Government agencies
128,121

 
1,240

 
3,626

 
114

 
131,747

 
1,354

Mortgage-backed securities issued by U.S. Government sponsored enterprises
2,123,181

 
42,571

 

 

 
2,123,181

 
42,571

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises
682,492

 
15,653

 
24,801

 
908

 
707,293

 
16,561

Other investments
14,952

 
48

 
4,888

 
359

 
19,840

 
407

Total
$
3,012,769

 
60,156

 
33,315

 
1,381

 
3,046,084

 
61,537

 
 
 
 
 
 
 
 
 
 
 
 

11


The amortized cost and fair value by contractual maturity of investment securities available for sale at March 31, 2017 are shown below. The expected life of mortgage-backed securities or CMOs may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. For purposes of the maturity table, mortgage-backed securities and CMOs, which are not due at a single maturity date, have been classified based on the final contractual maturity date.
 
Distribution of Maturities at March 31, 2017
(in thousands)
Within One
Year
 
1 to 5
Years
 
5 to 10
Years
 
More Than
10 Years
 
No Stated
Maturity
 
Total
Amortized Cost
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
$
18,756

 
64,685

 

 

 

 
83,441

U.S. Government agency securities
999

 
5,613

 
5,477

 

 

 
12,089

Mortgage-backed securities issued by U.S. Government agencies

 

 
33,513

 
133,281

 

 
166,794

Mortgage-backed securities issued by U.S. Government sponsored enterprises
93

 
1,603

 
570,250

 
2,265,413

 

 
2,837,359

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises

 

 

 
710,188

 

 
710,188

State and municipal securities
1,620

 
180

 

 

 

 
1,800

Other investments

 

 
15,000

 
2,000

 
3,263

 
20,263

Total amortized cost
$
21,468

 
72,081

 
624,240

 
3,110,882

 
3,263

 
3,831,934

 
 
 
 
 
 
 
 
 
 
 
 
Fair Value
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
$
18,756

 
64,135

 

 

 

 
82,891

U.S. Government agency securities
1,012

 
5,744

 
5,675

 

 

 
12,431

Mortgage-backed securities issued by U.S. Government agencies

 

 
33,728

 
132,551

 

 
166,279

Mortgage-backed securities issued by U.S. Government sponsored enterprises
96

 
1,700

 
565,770

 
2,234,978

 

 
2,802,544

Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises

 

 

 
696,892

 

 
696,892

State and municipal securities
1,620

 
181

 

 

 

 
1,801

Other investments

 

 
15,145

 
1,851

 
3,108

 
20,104

Total fair value
$
21,484

 
71,760

 
620,318

 
3,066,272

 
3,108

 
3,782,942

 
 
 
 
 
 
 
 
 
 
 
 
Proceeds from sales, gross gains, and gross losses on sales of securities available for sale for the three months ended March 31, 2017 and 2016 are presented below. The specific identification method is used to reclassify gains and losses out of other comprehensive income at the time of sale.
 
 
Three Months Ended March 31,
(in thousands)
 
2017
 
2016
Proceeds from sales of investment securities available for sale
 
$
282,629

 
243,609

Gross realized gains on sales
 
7,702

 
954

Gross realized losses on sales
 
(34
)
 
(887
)
Investment securities gains, net
 
$
7,668

 
67

 
 
 
 
 

12


Note 5 - Restructuring Charges
For the three months ended March 31, 2017 and 2016, total restructuring charges consist of the following components:
 
Three Months Ended March 31,
(in thousands)
2017
 
2016
Severance charges
$
6,453

 

Lease termination charges

 
44

Asset impairment charges

 
1,045

Other charges
58

 
51

Total restructuring charges, net
$
6,511

 
1,140

 
 
 
 
For the three months ended March 31, 2017, Synovus recorded severance charges of $6.5 million including $6.2 million for termination benefits incurred in conjunction with a voluntary early retirement program offered during the quarter. This program is part of Synovus' ongoing efficiency initiatives. The $6.2 million accrual is based on the benefits to be paid to employees who accepted the early retirement offer on or prior to the expiration of the program on March 30, 2017. During the three months ended March 31, 2016, Synovus recorded restructuring charges of $1.1 million related to the decision during the first quarter of 2016 to close four branches.
The following tables present aggregate activity within the accrual for restructuring charges for the three months ended March 31, 2017 and 2016:
(in thousands)
Severance Charges
 
Lease Termination Charges
 
Total
Balance at December 31, 2016
$
81

 
3,968

 
4,049

Accruals for voluntary and involuntary termination benefits
6,453

 

 
6,453

Payments
(219
)
 
(279
)
 
(498
)
Balance at March 31, 2017
$
6,315

 
3,689

 
10,004

 
 
 
 
 
 
(in thousands)
Severance Charges
 
Lease Termination Charges
 
Total
Balance at December 31, 2015
$
1,930

 
4,687

 
6,617

Accruals for lease terminations

 
44

 
44

Payments
(397
)
 
(186
)
 
(583
)
Balance at March 31, 2016
$
1,533

 
4,545

 
6,078

 
 
 
 
 
 
All other charges were paid in the quarters that they were incurred. No other restructuring charges resulted in payment accruals.

13


Note 6 - Loans and Allowance for Loan Losses
The following is a summary of current, accruing past due, and non-accrual loans by portfolio class as of March 31, 2017 and December 31, 2016.
Current, Accruing Past Due, and Non-accrual Loans
 
 
March 31, 2017
 
(in thousands)
Current
 
Accruing 30-89 Days Past Due
 
Accruing 90 Days or Greater Past Due
 
Total Accruing Past Due
 
Non-accrual
 
 Total
 
Investment properties
$
6,009,438

 
3,574

 

 
3,574

 
3,040

 
6,016,052

 
1-4 family properties
848,034

 
4,136

 
298

 
4,434

 
8,803

 
861,271

 
Land and development
559,447

 
8,029

 
72

 
8,101

 
14,352

 
581,900

 
Total commercial real estate
7,416,919

 
15,739

 
370

 
16,109

 
26,195

 
7,459,223

 
Commercial, financial and agricultural
6,978,658

 
16,313

 
680

 
16,993

 
60,381

 
7,056,032

 
Owner-occupied
4,650,611

 
7,559

 

 
7,559

 
26,564

 
4,684,734

 
Total commercial and industrial
11,629,269

 
23,872

 
680

 
24,552

 
86,945

 
11,740,766

 
Home equity lines
1,558,111

 
5,961

 
112

 
6,073

 
22,918

 
1,587,102

 
Consumer mortgages
2,323,543

 
7,313

 

 
7,313

 
19,874

 
2,350,730

 
Credit cards
221,018

 
1,716

 
1,615

 
3,331

 

 
224,349

 
Other consumer loans
914,825

 
4,759

 

 
4,759

 
2,434

 
922,018

 
Total consumer
5,017,497

 
19,749

 
1,727

 
21,476

 
45,226

 
5,084,199

 
Total loans
$
24,063,685

 
59,360

 
2,777

 
62,137

 
158,366

 
24,284,188

(1 
) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
(in thousands)
Current
 
Accruing 30-89 Days Past Due
 
Accruing 90 Days or Greater Past Due
 
Total Accruing Past Due
 
Non-accrual
 
 Total
 
Investment properties
$
5,861,198

 
2,795

 

 
2,795

 
5,268

 
5,869,261

 
1-4 family properties
873,231

 
4,801

 
161

 
4,962

 
9,114

 
887,307

 
Land and development
591,732

 
1,441

 

 
1,441

 
16,233

 
609,406

 
Total commercial real estate
7,326,161

 
9,037

 
161

 
9,198

 
30,615

 
7,365,974

 
Commercial, financial and agricultural
6,846,591

 
9,542

 
720

 
10,262

 
59,074

 
6,915,927

 
Owner-occupied
4,601,356

 
17,913

 
244

 
18,157

 
16,503

 
4,636,016

 
Total commercial and industrial
11,447,947

 
27,455

 
964

 
28,419

 
75,577

 
11,551,943

 
Home equity lines
1,585,228

 
10,013

 
473

 
10,486

 
21,551

 
1,617,265

 
Consumer mortgages
2,265,966

 
7,876

 
81

 
7,957

 
22,681

 
2,296,604

 
Credit cards
229,177

 
1,819

 
1,417

 
3,236

 

 
232,413

 
Other consumer loans
809,419

 
5,771

 
39

 
5,810

 
2,954

 
818,183

 
Total consumer
4,889,790

 
25,479

 
2,010

 
27,489

 
47,186

 
4,964,465

 
Total loans
$
23,663,898

 
61,971

 
3,135

 
65,106

 
153,378

 
23,882,382

(2 
) 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Total before net deferred fees and costs of $25.7 million.
(2) Total before net deferred fees and costs of $26.0 million.







14


The credit quality of the loan portfolio is summarized no less frequently than quarterly using the standard asset classification system utilized by the federal banking agencies. These classifications are divided into three groups – Not Criticized (Pass), Special Mention, and Classified or Adverse rating (Substandard, Doubtful, and Loss) and are defined as follows:
Pass - loans which are well protected by the current net worth and paying capacity of the obligor (or guarantors, if any) or by the fair value, less cost to acquire and sell in a timely manner, of any underlying collateral.
Special Mention - loans which have potential weaknesses that deserve management's close attention. These loans are not adversely classified and do not expose an institution to sufficient risk to warrant an adverse classification.
Substandard - loans which are inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. Loans with this classification are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.
Doubtful - loans which have all the weaknesses inherent in loans classified as Substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently known facts, conditions, and values.
Loss - loans which are considered by management to be uncollectible and of such little value that their continuance on the institution's books as an asset, without establishment of a specific valuation allowance or charge-off, is not warranted.
In the following tables, consumer loans are generally assigned a risk grade similar to the classifications described above; however, upon reaching 90 days and 120 days past due, they are generally downgraded to Substandard and Loss, respectively, in accordance with the FFIEC Uniform Retail Credit Classification and Account Management Policy. Additionally, in accordance with the Interagency Supervisory Guidance on Allowance for Loan and Lease Losses Estimation Practices for Loans and Lines of Credit Secured by Junior Liens on 1-4 Family Residential Properties, the risk grade classifications of consumer loans (home equity lines and consumer mortgages) secured by junior liens on 1-4 family residential properties also consider available information on the payment status of the associated senior lien with other financial institutions.

15


Loan Portfolio Credit Exposure by Risk Grade
 
 
March 31, 2017
 
(in thousands)
Pass
 
Special
Mention
 
Substandard(1)
 
Doubtful(2)
 
Loss
 
Total
 
Investment properties
$
5,945,008

 
46,057

 
24,987

 

 

 
6,016,052

 
1-4 family properties
812,321

 
24,801

 
23,901

 
248

 

 
861,271

 
Land and development
506,779

 
44,332

 
23,876

 
6,913

 

 
581,900

 
Total commercial real estate
7,264,108

 
115,190

 
72,764

 
7,161

 

 
7,459,223

 
Commercial, financial and agricultural
6,765,031

 
138,102

 
146,329

 
6,430

 
140

(3) 
7,056,032

 
Owner-occupied
4,522,172

 
50,774

 
110,378

 
1,410

 

 
4,684,734

 
Total commercial and industrial
11,287,203

 
188,876

 
256,707

 
7,840

 
140

 
11,740,766

 
Home equity lines
1,557,077

 

 
25,157

 
2,263

 
2,605

(3) 
1,587,102

 
Consumer mortgages
2,329,408

 

 
20,094

 
1,061

 
167

(3) 
2,350,730

 
Credit cards
222,733

 

 
391

 

 
1,225

(4) 
224,349

 
Other consumer loans
919,415

 

 
2,516

 
42

 
45

(3) 
922,018

 
Total consumer
5,028,633

 

 
48,158

 
3,366

 
4,042

 
5,084,199

 
Total loans
$
23,579,944

 
304,066

 
377,629

 
18,367

 
4,182

 
24,284,188

(5 
) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
(in thousands)
Pass
 
Special
Mention
 
Substandard(1)
 
Doubtful(2)
 
Loss
 
Total
 
Investment properties
$
5,794,626

 
43,336

 
31,299

 

 

 
5,869,261

 
1-4 family properties
826,311

 
33,928

 
26,790

 
278

 

 
887,307

 
Land and development
514,853

 
60,205

 
27,361

 
6,987

 

 
609,406