x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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91-1962278
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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3003 Tasman Drive, Santa Clara, California
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95054-1191
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common stock, par value $0.001 per share
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NASDAQ Global Select Market
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Documents Incorporated by Reference
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Parts of Form 10-K Into Which Incorporated
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Definitive proxy statement for the Company's 2019 Annual Meeting of Stockholders to be filed within 120 days of the end of the fiscal year ended December 31, 2018
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Part III
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Page
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PART I.
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV.
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Item 15.
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Item 16.
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•
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Financial projections, including with respect to our net interest income, noninterest income, earnings per share, noninterest expenses (including professional services, compliance, compensation and other costs), cash flows, balance sheet positions, capital expenditures, liquidity and capitalization or other financial items;
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•
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Descriptions of our strategic initiatives, plans or objectives for future operations, including pending sales or acquisitions;
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•
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Forecasts of private equity and venture capital funding and investment levels;
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•
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Forecasts of future interest rates, economic performance, and income from investments;
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•
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Forecasts of expected levels of provisions for loan losses, loan growth and client funds; and
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•
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Descriptions of assumptions underlying or relating to any of the foregoing.
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•
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Market and economic conditions, including the interest rate environment, and the associated impact on us;
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•
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The credit profile and credit quality of our loan portfolio and volatility of our levels of nonperforming assets and charge-offs;
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•
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The adequacy of our allowance for loan losses and the need to make provisions for loan losses for any period;
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•
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The borrowing needs of our clients;
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•
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The sufficiency of our capital and liquidity positions;
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•
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The levels of loans, deposits and client investment fund balances;
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•
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The performance of our portfolio investments as well as the general condition of the public and private equity and mergers and acquisitions markets and their impact on our investments, including equity warrant assets, venture capital and private equity funds and direct equity investments;
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•
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Our overall investment plans and strategies as well as the realization, timing, valuation and performance of our equity or other investments;
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•
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The levels of public offerings, mergers and acquisitions and venture capital investment activity of our clients that may impact the borrowing needs of our clients and demand for our investment banking and other services;
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•
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The occurrence of fraudulent activity, including breaches of our information security or cyber security-related incidents;
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•
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Business disruptions and interruptions due to natural disasters and other external events;
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•
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The impact on our reputation and business from our interactions with business partners, counterparties, service providers and other third parties;
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•
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Expansion of our business internationally, and the impact of international market and economic events on us;
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•
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Our ability to maintain or increase our market share through successfully implementing our business strategy and undertaking new business initiatives, including through the integration of newly-acquired Leerink Holdings LLC, now SVB Leerink Holdings LLC ("SVB Leerink");
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•
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The impact of governmental policy, legal requirements and regulations including Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), regulations promulgated by the Board of Governors of the Federal Reserve (the "Federal Reserve"), and other regulatory requirements;
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•
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The impact of lawsuits and claims, as well as legal or regulatory proceedings;
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•
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The impact of changes in accounting standards and tax laws;
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•
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The levels of equity capital available to our client or portfolio companies;
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•
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The effectiveness of our risk management framework and quantitative models; and
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•
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Other factors as discussed in “Risk Factors” under Part I, Item 1A of this report.
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ITEM 1.
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BUSINESS
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•
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Our
SVB Accelerator
practice focuses on serving our “emerging” or “early-stage” clients. These clients are generally privately-held companies in the start-up or early stages of their life cycles and funded by friends and family,
“
seed
”
or
“
angel
”
investors, or have gone through an initial round of venture capital financing. They are typically engaged primarily in research and development activities and may have brought only a few products or services to market, if any. SVB Accelerator clients tend to have annual revenues below $5 million, and many are pre-revenue companies.
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•
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Our
SVB Growth
practice serves our “mid-stage” and “late-stage” clients. These clients are generally privately-held companies in the intermediate or later stages of their life cycles, and are often dependent on venture capital for funding. However, some of these clients are in the more advanced stages of their life cycles and may be publicly-held or poised to become publicly-held. Our SVB Growth clients generally have a more established product or service offering in the market and may be in a period of expansion. SVB Growth clients tend to have annual revenues between $5 million and $75 million.
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•
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Our
SVB Corporate Finance
practice primarily serves our large corporate clients, which are more mature and established companies. These clients are generally publicly-held or large privately-held companies and have a more sophisticated product or service offering in the market. SVB Corporate Finance clients tend to have annual revenues over $75 million.
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•
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Require periodic reports and such other additional information as the Federal Reserve may require in its discretion;
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•
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Require the maintenance of certain minimum levels of capital and adherence to capital adequacy standards;
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•
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Restrict the ability of bank holding companies to service debt, pay dividends or receive dividends or other distributions from their subsidiary banks;
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•
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Require prior approval for senior executive officer and director changes under certain circumstances;
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•
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Require that bank holding companies serve as a source of financial and managerial strength to their banks and commit resources as necessary to support their banks. The determination of a bank holding company’s failure to meet its obligations to serve as a source of strength to its subsidiary banks will generally be considered by the Federal Reserve to be an unsafe and unsound banking practice, a violation of Federal Reserve regulations or otherwise inconsistent with applicable statutory standards, or all of the foregoing;
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•
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Terminate an activity or terminate control of or liquidate or divest certain subsidiaries, affiliates or investments if the Federal Reserve believes the activity or the control of the subsidiary or affiliate constitutes a serious risk to the financial safety, soundness or stability of any bank subsidiary, or if there is a failure to maintain certain capital and management standards;
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•
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Regulate provisions of certain bank holding company debt, including the authority to impose interest ceilings and reserve requirements on such debt and require prior approval to purchase or redeem our securities in certain situations; and
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•
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Require approval of acquisitions and mergers with banks and large financial companies and consider certain competitive, management, financial, financial stability and other factors in granting these approvals. Similar California and other state banking agency approvals may also be required.
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•
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Capital standards applicable to bank holding companies that may be no less stringent than those generally applicable to insured depository institutions;
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•
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Periodic stress tests for financial entities with $250 billion or more in total consolidated assets;
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•
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Additional risk management and other enhanced prudential standards for larger bank holding companies with $250 billion or more in total consolidated assets (See "-Enhanced Prudential Standards" below);
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•
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Risk committee requirements for publicly traded bank holding companies with $50 billion or more in total consolidated assets;
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•
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Restrictions on a banking institution’s ability to engage in proprietary trading and to sponsor, invest in or lend to certain funds, including venture capital, hedge and private equity funds;
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•
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Repeal of the federal prohibition (Regulation Q) on the payment of interest on demand deposits, including business checking accounts, and establishment of the $250,000 limit for federal deposit insurance;
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•
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The establishment of the CFPB with responsibility for promulgating and enforcing regulations designed to protect consumers’ financial interests and prohibit unfair, deceptive and abusive acts and practices by financial institutions;
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•
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The authority of the CFPB to directly examine those financial institutions with $10 billion or more in assets, such as SVB Financial, for compliance with the regulations promulgated by the CFPB;
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•
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Limits, or the imposition of significant burdens and compliance and other costs on, certain activities previously conducted by banking organizations, such as originating and securitizing mortgage loans and other financial assets, arranging and participating in swap and derivative transactions, proprietary trading and investing in private equity and other funds and restrictions on debit charge interchange fees; and
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•
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The establishment of new compensation restrictions and standards regarding the time, manner and form of compensation given to key executives and other personnel receiving incentive compensation, including documentation and governance, proxy access by stockholders, deferral and claw-back requirements.
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•
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Comprehensive Capital Analysis and Review (“CCAR”).
Current regulations require bank holding companies with $50 billion or more in total consolidated assets to submit an annual capital plan to the Federal Reserve. Following the passage of the EGRRCPA, the Federal Reserve issued a statement that it would not require firms with less than $100 billion in total consolidated assets to comply with that requirement. The Tailoring Proposal would revise the Federal Reserve’s regulations to reflect this new $100 billion threshold. For firms subject to CCAR, failure to submit a satisfactory plan can result in restrictions on the payment of dividends as well as other restrictions.
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•
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Stress Testing
. Currently, Federal Reserve regulations require bank holding companies to submit to the Federal Reserve the results of a mid-year and annual company-run stress test and make summaries of such results available to the public. Bank holding companies with $10 billion or more, but less than $50 billion, in average total consolidated assets are subject to annual company run stress test requirements. In addition, bank holding companies with $50 billion or more in total consolidated assets currently are subject to semi-annual company-run stress test requirements and an annual supervisory stress test conducted by the Federal Reserve, which publicly discloses summaries of the results of the supervisory stress tests. Following passage of the EGRRCPA, the Federal Reserve issued a statement that it would not require bank holding companies with less than $100 billion in total consolidated assets to comply with these requirements. Further, under the Tailoring Proposal, these stress testing requirements only would apply to bank holding companies with $100 billion or more in total consolidated assets.
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•
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Resolution Planning
. Bank holding companies are required to annually submit to the Federal Reserve and the FDIC a plan for rapid and orderly resolution in the event of material financial distress or failure. Separately, the FDIC requires insured depository institutions (“IDI”) that have average total consolidated assets of $50 billion or more, based on a four-quarter average, to annually submit to the FDIC a plan that enables the FDIC as receiver to resolve the bank under Sections 11 and 13 of the Federal Deposit Insurance Act, as amended (the “FDIA”). Following passage of the EGRRCPA, the Federal Reserve and FDIC issued a statement that they would not require bank holding companies with less than $100 billion to comply with these requirements. The EGRRCPA did not change the threshold for the FDIC’s IDI resolution planning requirement, but the FDIC has said that it will evaluate whether to revise the applicability threshold for that rule. For those depository institutions subject to the FDIC's IDI resolution planning requirement, the FDIC also announced in August 2018 the extension of the deadline for submitting IDI resolution plans to no sooner than July 1, 2020.
|
•
|
Liquidity Coverage Ratio
. Pursuant to the Liquidity Coverage Ratio (“LCR”) requirement, bank holding companies are required to maintain high-quality liquid assets in accordance with specific quantitative requirements. A modified, less stringent version of the Federal Reserve’s LCR rule applies to bank holding companies with greater than $50 billion in average total consolidated assets, but less than $250 billion in average total consolidated assets and $10 billion in on-balance sheet foreign exposures (so-called “advanced approaches” banking organizations). Following passage of the EGRRCPA, the Federal Reserve issued a statement that they would not require bank holding companies with less than $100 billion to comply with the modified LCR. Further, under the Capital and Liquidity Thresholds Proposal, only bank holding companies with $100 billion or more in total consolidated assets would be subject to any form of LCR requirement.
|
•
|
Risk Management
. Bank holding companies must comply with enhanced risk management requirements. These requirements impose standards on the Board of Directors’ risk committee and for a chief risk officer. The enhanced prudential requirements also impose liquidity risk management standards and require subject bank holding companies to conduct regular liquidity stress testing over various time horizons and maintain a buffer of liquid assets based on the results of such stress testing. Bank holding companies are required to comply with such risk management and liquidity risk management requirements on the first day of the fifth quarter after becoming subject to the enhanced prudential standards. Following passage of the EGRRCPA, the Federal Reserve issued a statement that it would not seek to require bank holding companies with less than $100 billion in total consolidated assets to satisfy these requirements, other than the risk-management and risk committee requirements. The Tailoring Proposal would revise the Federal Reserve’s regulations to reflect this new $100 billion threshold.
|
•
|
Pillar III Disclosure
. Bank holding companies are required to make timely qualitative and quantitative disclosures about their regulatory capital, referred to as “Pillar III disclosures.” Quantitative disclosures must be made quarterly, and qualitative disclosures that do not change each quarter may be disclosed annually. Bank holding companies are required to make Pillar III disclosures after reporting $50 billion or more in total consolidated assets in their year-end financial reports to the Federal Reserve. Because the disclosures are backward-looking, a bank holding company makes its first disclosures with respect to data from prior quarters.
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•
|
Require affirmative action to correct any conditions resulting from any violation or practice;
|
•
|
Require prior approval for senior executive officer and director changes;
|
•
|
Direct an increase in capital and the maintenance of specific minimum capital ratios which may preclude the Bank from being deemed well capitalized for regulatory purposes;
|
•
|
Restrict the Bank’s growth geographically, by products and services, or by mergers and acquisitions;
|
•
|
Enter into informal or formal enforcement orders, including memoranda of understanding, written agreements and consent or cease and desist orders to take corrective action and enjoin unsafe and unsound practices;
|
•
|
Restrict or prohibit the Bank from paying dividends or making other distributions to SVB Financial;
|
•
|
Remove officers and directors and assess civil monetary penalties; and
|
•
|
Take possession of and close and liquidate the Bank.
|
•
|
Application of a Standardized Capital Floor
. Section 171 of the Dodd-Frank Act, commonly referred to as the Collins Amendment, provides that a banking organization’s capital requirements calculated under the “advanced approaches” capital rules may not be lower than the capital requirements calculated using the prescriptive “standardized approach” that otherwise generally applies to banking organizations.
|
•
|
Supplementary Leverage Ratio of 3%.
The supplementary leverage ratio (“SLR”) is more stringent than the otherwise applicable Tier 1 leverage ratio of 4%, which is discussed below. Under the Capital and Liquidity Thresholds Proposal, the SLR would apply to banking organizations with $250 billion or more in total consolidated assets, or $100 billion or more in total consolidated assets and $75 billion or more in any one or more of (1) nonbank assets; (2) weighted short-term wholesale funding (“wSTWF”); and (3) off-balance-sheet exposures.
|
•
|
Unavailability of the Accumulated Other Comprehensive Income Opt-Out Election under the Risk-Based Capital Rules
. Banking organizations subject to the advanced approaches capital rules are not permitted to opt-out from having accumulated other comprehensive income (“AOCI”) included in regulatory capital.
|
•
|
Countercyclical Capital Buffer
. This standard requires a banking organization to hold an additional buffer amount, designed to counteract systemic vulnerabilities. The buffer amount is currently set by the Federal Reserve at zero percent, but could change in the future. If the buffer is not met, the banking organization is subject to limitations on dividends and other payouts
.
Under the Capital and Liquidity Thresholds Proposal, this requirement would apply to banking organizations with $250 billion or more in total consolidated assets, or $100 billion or more in total consolidated assets and $75 billion or more in any one or more of (1) nonbank assets; (2) wSTWF; and (3) off-balance-sheet exposures.
|
•
|
Full Liquidity Coverage Ratio
. The full LCR requires LCR calculation on a daily (compared to the modified LCR’s monthly standard) basis, uses the banking organization’s full net cash outflow amount (compared to 70% under the modified LCR), and includes an “add-on” to net cash outflows for certain maturity mismatch during the 30-day LCR period. Under the Capital and Liquidity Thresholds Proposal, the full LCR also would apply to banking organizations with $250 billion or more in total consolidated assets or $100 billion or more in total consolidated assets and $75 billion or more in wSTWF.
|
•
|
4.5% CET1 to risk-weighted assets
|
•
|
6.0% Tier 1 capital to risk-weighted assets
|
•
|
8.0% Total capital to risk-weighted assets
|
•
|
4.0% Tier 1 capital to average consolidated assets as reported on consolidated financial statements (known as the “leverage ratio”)
|
ITEM 1A.
|
RISK FACTORS
|
•
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general market conditions and, in particular, developments related to market conditions for the financial services industry;
|
•
|
actual or anticipated changes in interest rates;
|
•
|
market perceptions about the innovation economy, including levels of funding or "exit" activities of companies in the industries we serve;
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
Period ended
|
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Total number of shares purchased
|
|
Average price paid per share
|
|
Total number of shares purchased as part of publicly announced programs
|
|
Maximum dollar value that may yet be purchased under the programs (1)
|
||||||
October 31, 2018
|
|
—
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|
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—
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|
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—
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|
|||
November 30, 2018
|
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—
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|
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—
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|
|
—
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|
|
|
|||
December 31, 2018
|
|
715,207
|
|
|
$
|
205.71
|
|
|
715,207
|
|
|
$
|
352,874,768
|
|
Total
|
|
715,207
|
|
|
$
|
205.71
|
|
|
715,207
|
|
|
$
|
352,874,768
|
|
|
|
|
December 31,
|
||||||||||||||||||||||
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
||||||||||||
SVB Financial Group
|
|
$
|
100.00
|
|
|
$
|
110.69
|
|
|
$
|
113.39
|
|
|
$
|
163.70
|
|
|
$
|
222.94
|
|
|
$
|
181.12
|
|
S&P 500
|
|
100.00
|
|
|
113.69
|
|
|
115.26
|
|
|
129.05
|
|
|
157.22
|
|
|
150.33
|
|
||||||
NASDAQ Composite
|
|
100.00
|
|
|
114.62
|
|
|
122.81
|
|
|
133.19
|
|
|
172.11
|
|
|
165.84
|
|
||||||
NASDAQ Bank
|
|
100.00
|
|
|
104.89
|
|
|
113.29
|
|
|
155.71
|
|
|
164.24
|
|
|
136.99
|
|
ITEM 6.
|
SELECTED CONSOLIDATED FINANCIAL DATA
|
|
|
Year ended December 31,
|
||||||||||||||||||
(Dollars in thousands, except per share amounts and ratios)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Income statement summary:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest income
|
|
$
|
1,893,988
|
|
|
$
|
1,420,369
|
|
|
$
|
1,150,523
|
|
|
$
|
1,006,425
|
|
|
$
|
856,595
|
|
Provision for credit losses
|
|
(87,870
|
)
|
|
(92,304
|
)
|
|
(106,679
|
)
|
|
(95,683
|
)
|
|
(65,997
|
)
|
|||||
Noninterest income
|
|
744,984
|
|
|
557,231
|
|
|
456,552
|
|
|
472,794
|
|
|
572,239
|
|
|||||
Noninterest expense
|
|
(1,188,193
|
)
|
|
(1,010,655
|
)
|
|
(859,797
|
)
|
|
(779,962
|
)
|
|
(700,669
|
)
|
|||||
Income before income tax expense
|
|
1,362,909
|
|
|
874,641
|
|
|
640,599
|
|
|
603,574
|
|
|
662,168
|
|
|||||
Income tax expense
|
|
(351,561
|
)
|
|
(355,463
|
)
|
|
(250,333
|
)
|
|
(228,754
|
)
|
|
(183,508
|
)
|
|||||
Net income before noncontrolling interests
|
|
1,011,348
|
|
|
519,178
|
|
|
390,266
|
|
|
374,820
|
|
|
478,660
|
|
|||||
Net income attributable to noncontrolling interests
|
|
(37,508
|
)
|
|
(28,672
|
)
|
|
(7,581
|
)
|
|
(30,916
|
)
|
|
(214,790
|
)
|
|||||
Net income available to common stockholders
|
|
$
|
973,840
|
|
|
$
|
490,506
|
|
|
$
|
382,685
|
|
|
$
|
343,904
|
|
|
$
|
263,870
|
|
Common share summary:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings per common share—basic
|
|
$
|
18.35
|
|
|
$
|
9.33
|
|
|
$
|
7.37
|
|
|
$
|
6.70
|
|
|
$
|
5.39
|
|
Earnings per common share—diluted
|
|
18.11
|
|
|
9.20
|
|
|
7.31
|
|
|
6.62
|
|
|
5.31
|
|
|||||
Book value per common share
|
|
97.29
|
|
|
79.11
|
|
|
69.71
|
|
|
61.97
|
|
|
55.24
|
|
|||||
Weighted average shares outstanding—basic
|
|
53,078
|
|
|
52,588
|
|
|
51,915
|
|
|
51,318
|
|
|
48,931
|
|
|||||
Weighted average shares outstanding—diluted
|
|
53,772
|
|
|
53,306
|
|
|
52,349
|
|
|
51,916
|
|
|
49,662
|
|
|||||
Year-end balance sheet summary:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Available-for-sale securities
|
|
$
|
7,790,043
|
|
|
$
|
11,120,664
|
|
|
$
|
12,620,411
|
|
|
$
|
16,380,748
|
|
|
$
|
13,540,655
|
|
Held-to-maturity securities
|
|
15,487,442
|
|
|
12,663,455
|
|
|
8,426,998
|
|
|
8,790,963
|
|
|
7,421,042
|
|
|||||
Loans, net of unearned income
|
|
28,338,280
|
|
|
23,106,316
|
|
|
19,899,944
|
|
|
16,742,070
|
|
|
14,384,276
|
|
|||||
Total assets
|
|
56,927,979
|
|
|
51,214,467
|
|
|
44,683,660
|
|
|
44,686,703
|
|
|
39,337,869
|
|
|||||
Deposits
|
|
49,328,900
|
|
|
44,254,075
|
|
|
38,979,868
|
|
|
39,142,776
|
|
|
34,343,499
|
|
|||||
Short-term borrowings
|
|
631,412
|
|
|
1,033,730
|
|
|
512,668
|
|
|
774,900
|
|
|
7,781
|
|
|||||
Long-term debt
|
|
696,465
|
|
|
695,492
|
|
|
795,704
|
|
|
796,702
|
|
|
451,362
|
|
|||||
SVBFG stockholders' equity
|
|
5,116,209
|
|
|
4,179,795
|
|
|
3,642,554
|
|
|
3,198,134
|
|
|
2,813,072
|
|
|||||
Average balance sheet summary:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Available-for-sale securities
|
|
$
|
9,789,211
|
|
|
$
|
12,424,137
|
|
|
$
|
13,331,315
|
|
|
$
|
14,436,140
|
|
|
$
|
12,907,135
|
|
Held-to-maturity securities
|
|
14,997,846
|
|
|
9,984,610
|
|
|
8,192,183
|
|
|
7,829,177
|
|
|
3,696,417
|
|
|||||
Loans, net of unearned income
|
|
25,630,520
|
|
|
21,159,394
|
|
|
18,283,591
|
|
|
14,762,941
|
|
|
11,502,941
|
|
|||||
Total assets
|
|
55,229,060
|
|
|
48,380,272
|
|
|
43,987,451
|
|
|
40,846,377
|
|
|
32,961,936
|
|
|||||
Deposits
|
|
48,075,344
|
|
|
42,745,148
|
|
|
38,759,059
|
|
|
36,293,362
|
|
|
28,320,825
|
|
|||||
Short-term borrowings
|
|
643,886
|
|
|
48,505
|
|
|
220,251
|
|
|
23,226
|
|
|
6,264
|
|
|||||
Long-term debt
|
|
695,938
|
|
|
766,943
|
|
|
796,302
|
|
|
770,848
|
|
|
452,215
|
|
|||||
SVBFG stockholders' equity
|
|
4,734,417
|
|
|
3,961,405
|
|
|
3,509,526
|
|
|
3,075,371
|
|
|
2,523,235
|
|
|||||
Capital ratios:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
SVBFG CET 1 risk-based capital ratio
|
|
13.41
|
%
|
|
12.78
|
%
|
|
12.80
|
%
|
|
12.28
|
%
|
|
—
|
%
|
|||||
SVBFG total risk-based capital ratio
|
|
14.45
|
|
|
13.96
|
|
|
14.21
|
|
|
13.84
|
|
|
13.92
|
|
|||||
SVBFG tier 1 risk-based capital ratio
|
|
13.58
|
|
|
12.97
|
|
|
13.26
|
|
|
12.83
|
|
|
12.91
|
|
|||||
SVBFG tier 1 leverage ratio
|
|
9.06
|
|
|
8.34
|
|
|
8.34
|
|
|
7.63
|
|
|
7.74
|
|
|||||
SVBFG tangible common equity to tangible assets (1)
|
|
8.99
|
|
|
8.16
|
|
|
8.15
|
|
|
7.16
|
|
|
7.15
|
|
|||||
SVBFG tangible common equity to risk-weighted assets (1)
|
|
13.28
|
|
|
12.77
|
|
|
12.89
|
|
|
12.34
|
|
|
12.93
|
|
|||||
Bank CET 1 risk-based capital ratio
|
|
12.41
|
|
|
12.06
|
|
|
12.65
|
|
|
12.52
|
|
|
—
|
|
|||||
Bank total risk-based capital ratio
|
|
13.32
|
|
|
13.04
|
|
|
13.66
|
|
|
13.60
|
|
|
12.12
|
|
|||||
Bank tier 1 risk-based capital ratio
|
|
12.41
|
|
|
12.06
|
|
|
12.65
|
|
|
12.52
|
|
|
11.09
|
|
|||||
Bank tier 1 leverage ratio
|
|
8.10
|
|
|
7.56
|
|
|
7.67
|
|
|
7.09
|
|
|
6.64
|
|
|||||
Bank tangible common equity to tangible assets (1)
|
|
8.13
|
|
|
7.47
|
|
|
7.77
|
|
|
6.95
|
|
|
6.38
|
|
|||||
Bank tangible common equity to risk-weighted assets (1)
|
|
12.28
|
|
|
11.98
|
|
|
12.75
|
|
|
12.59
|
|
|
11.19
|
|
|||||
Average SVBFG stockholders' equity to average assets
|
|
8.57
|
|
|
8.19
|
|
|
7.98
|
|
|
7.53
|
|
|
7.65
|
|
|||||
Selected financial results:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Return on average assets
|
|
1.76
|
%
|
|
1.01
|
%
|
|
0.87
|
%
|
|
0.84
|
%
|
|
0.80
|
%
|
|||||
Return on average common SVBFG stockholders' equity
|
|
20.57
|
|
|
12.38
|
|
|
10.90
|
|
|
11.18
|
|
|
10.46
|
|
|||||
Net interest margin
|
|
3.57
|
|
|
3.05
|
|
|
2.72
|
|
|
2.57
|
|
|
2.81
|
|
|||||
Gross loan charge-offs to average total gross loans
|
|
0.26
|
|
|
0.31
|
|
|
0.53
|
|
|
0.34
|
|
|
0.37
|
|
|||||
Net loan charge-offs to average total gross loans
|
|
0.22
|
|
|
0.27
|
|
|
0.46
|
|
|
0.30
|
|
|
0.32
|
|
|||||
Nonperforming assets as a percentage of total assets
|
|
0.17
|
|
|
0.23
|
|
|
0.27
|
|
|
0.28
|
|
|
0.10
|
|
|||||
Allowance for loan losses as a percentage of total gross loans
|
|
0.99
|
|
|
1.10
|
|
|
1.13
|
|
|
1.29
|
|
|
1.14
|
|
|
(1)
|
See “Management's Discussion and Analysis of Financial Condition and Results of Operations-Capital Resources-Capital Ratios” under Part II, Item 7 of this report for a reconciliation of non-GAAP tangible common equity to tangible assets and tangible common equity to risk-weighted assets.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
BALANCE SHEET
|
|
EARNINGS
|
Assets.
$55.2 billion in average total assets (up 14.2%). $56.9 billion in period-end total assets (up 11.2%).
Loans.
$25.6 billion in average total loan balances, net of unearned income (up 21.1%). $28.3 billion in period-end total loan balances, net of unearned income (up 22.6%).
Total Client Funds.
(on-balance sheet deposits and off-balance sheet client investment funds).
$123.1 billion in average total client fund balances (up 30.6%). $135.3 billion in period-end total client fund balances (up 29.4%).
AFS/HTM Fixed Income Investments.
$24.8 billion in average fixed income investment securities (up 10.6%). $23.3 billion in period-end fixed income investment securities (down 2.1%).
|
|
EPS.
Earnings per diluted share of $18.11 (up 96.8%).
Net Income.
Consolidated net income available to common stockholders of $973.8 million (up 98.5%).
- Net interest income of $1.9 billion (up 33.3%).
- Net interest margin of 3.57% (up 52bps).
- Noninterest income of $745.0 million, with non- GAAP core fee income
+
of $515.9 million (up 36.1%).
- Noninterest expense of $1.2 billion (up 17.6%).
ROE.
Return on average equity (“
ROE
”) performance of 20.57%.
Operating Efficiency Ratio.
Operating efficiency ratio of 45.02% with a non-GAAP core operating efficiency ratio of 48.27%
++
.
|
|
|
|
CAPITAL
|
|
CREDIT QUALITY
|
Capital.
Continued strong capital, with all capital ratios considered "well-capitalized" under banking regulations, SVBFG and SVB capital ratios, respectively, were:
- CET 1 risk-based capital ratio of 13.41% and 12.41%
.
- Tier 1 risk-based capital ratio of 13.58% and 12.41%.
- Total risk-based capital ratio of 14.45% and 13.32%. - Tier 1 leverage ratio of 9.06% and 8.10%.
|
|
Credit Quality.
Continued disciplined underwriting.
- Allowance for loan losses of 0.99% as a percentage of period-end total gross loans.
- Provision for loan losses of 0.30% as a percentage of total gross loans.
- Net loan charge-offs of 0.22% as a percentage of average total gross loans.
|
+
|
Consists of fee income for foreign exchange, credit cards, deposit services, client investments, letters of credit and lending related activities. This is a non-GAAP financial measure. (See the non-GAAP reconciliation under “Results of Operations—Noninterest Income”).
|
++
|
This ratio excludes certain financial line items where performance is typically subject to market or other conditions beyond our control. It is calculated by dividing noninterest expense by total revenue, after adjusting for gains or losses on investment securities and equity warrant assets. This is a non-GAAP financial measure. (See the non-GAAP reconciliation under “Results of Operations—Noninterest Expense”).
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands, except per share amounts and ratios)
|
|
2018
|
|
2017
|
|
% Change
|
||||||
Income Statement:
|
|
|
|
|
|
|
|
|||||
Diluted earnings per share
|
|
$
|
18.11
|
|
|
$
|
9.20
|
|
|
96.8
|
|
%
|
Net income available to common stockholders
|
|
973,840
|
|
|
490,506
|
|
|
98.5
|
|
|
||
Net interest income
|
|
1,893,988
|
|
|
1,420,369
|
|
|
33.3
|
|
|
||
Net interest margin
|
|
3.57
|
%
|
|
3.05
|
%
|
|
52
|
|
bps
|
||
Provision for credit losses
|
|
$
|
87,870
|
|
|
$
|
92,304
|
|
|
(4.8
|
)
|
%
|
Noninterest income
|
|
744,984
|
|
|
557,231
|
|
|
33.7
|
|
|
||
Noninterest expense
|
|
1,188,193
|
|
|
1,010,655
|
|
|
17.6
|
|
|
||
Non-GAAP core fee income (1)
|
|
515,890
|
|
|
378,963
|
|
|
36.1
|
|
|
||
Non-GAAP noninterest income, net of noncontrolling interests (1)
|
|
706,984
|
|
|
527,779
|
|
|
34.0
|
|
|
||
Non-GAAP noninterest expense, net of noncontrolling interests (2)
|
|
1,187,671
|
|
|
1,009,842
|
|
|
17.6
|
|
|
||
Balance Sheet:
|
|
|
|
|
|
|
|
|||||
Average available-for-sale-securities
|
|
$
|
9,789,211
|
|
|
$
|
12,424,137
|
|
|
(21.2
|
)
|
%
|
Average held-to-maturity securities
|
|
14,997,846
|
|
|
9,984,610
|
|
|
50.2
|
|
|
||
Average loans, net of unearned income
|
|
25,630,520
|
|
|
21,159,394
|
|
|
21.1
|
|
|
||
Average noninterest-bearing demand deposits
|
|
39,633,118
|
|
|
35,235,200
|
|
|
12.5
|
|
|
||
Average interest-bearing deposits
|
|
8,442,226
|
|
|
7,509,948
|
|
|
12.4
|
|
|
||
Average total deposits
|
|
48,075,344
|
|
|
42,745,148
|
|
|
12.5
|
|
|
||
Earnings Ratios:
|
|
|
|
|
|
|
|
|||||
Return on average assets (3)
|
|
1.76
|
%
|
|
1.01
|
%
|
|
74.3
|
|
%
|
||
Return on average common SVBFG stockholders’ equity (4)
|
|
20.57
|
|
|
12.38
|
|
|
66.2
|
|
|
||
Asset Quality Ratios:
|
|
|
|
|
|
|
|
|||||
Allowance for loan losses as a percentage of total period-end gross loans
|
|
0.99
|
%
|
|
1.10
|
%
|
|
(11
|
)
|
bps
|
||
Allowance for loan losses for performing loans as a percentage of total gross performing loans
|
|
0.86
|
|
|
0.92
|
|
|
(6
|
)
|
|
||
Gross loan charge-offs as a percentage of average total gross loans
|
|
0.26
|
|
|
0.31
|
|
|
(5
|
)
|
|
||
Net loan charge-offs as a percentage of average total gross loans
|
|
0.22
|
|
|
0.27
|
|
|
(5
|
)
|
|
||
Capital Ratios:
|
|
|
|
|
|
|
|
|||||
SVBFG CET 1 risk-based capital ratio
|
|
13.41
|
%
|
|
12.78
|
%
|
|
63
|
|
bps
|
||
SVBFG total risk-based capital ratio
|
|
14.45
|
|
|
13.96
|
|
|
49
|
|
|
||
SVBFG tier 1 risk-based capital ratio
|
|
13.58
|
|
|
12.97
|
|
|
61
|
|
|
||
SVBFG tier 1 leverage ratio
|
|
9.06
|
|
|
8.34
|
|
|
72
|
|
|
||
SVBFG tangible common equity to tangible assets (5)
|
|
8.99
|
|
|
8.16
|
|
|
83
|
|
|
||
SVBFG tangible common equity to risk-weighted assets (5)
|
|
13.28
|
|
|
12.77
|
|
|
51
|
|
|
||
Bank CET 1 risk-based capital ratio
|
|
12.41
|
|
|
12.06
|
|
|
35
|
|
|
||
Bank total risk-based capital ratio
|
|
13.32
|
|
|
13.04
|
|
|
28
|
|
|
||
Bank tier 1 risk-based capital ratio
|
|
12.41
|
|
|
12.06
|
|
|
35
|
|
|
||
Bank tier 1 leverage ratio
|
|
8.10
|
|
|
7.56
|
|
|
54
|
|
|
||
Bank tangible common equity to tangible assets (5)
|
|
8.13
|
|
|
7.47
|
|
|
66
|
|
|
||
Bank tangible common equity to risk-weighted assets (5)
|
|
12.28
|
|
|
11.98
|
|
|
30
|
|
|
||
Other Ratios:
|
|
|
|
|
|
|
|
|||||
GAAP operating efficiency ratio (6)
|
|
45.02
|
%
|
|
51.11
|
%
|
|
(11.9
|
)
|
%
|
||
Non-GAAP operating efficiency ratio (2)
|
|
45.50
|
|
|
51.76
|
|
|
(12.1
|
)
|
|
||
Non-GAAP core operating efficiency ratio (2)
|
|
48.27
|
|
|
54.38
|
|
|
(11.2
|
)
|
|
||
Book value per common share (7)
|
|
$
|
97.29
|
|
|
$
|
79.11
|
|
|
23.0
|
|
|
Other Statistics:
|
|
|
|
|
|
|
|
|||||
Average full-time equivalent employees
|
|
2,685
|
|
|
2,396
|
|
|
12.1
|
|
%
|
||
Period-end full-time equivalent employees
|
|
2,900
|
|
|
2,438
|
|
|
18.9
|
|
|
|
(1)
|
See “Results of Operations–Noninterest Income” below for a description and reconciliation of non-GAAP core fee income and noninterest income.
|
(2)
|
See “Results of Operations–Noninterest Expense” below for a description and reconciliation of non-GAAP noninterest expense, non-GAAP operating efficiency ratio and non-GAAP core operating efficiency ratio.
|
(3)
|
Ratio represents consolidated net income available to common stockholders divided by average assets.
|
(4)
|
Ratio represents consolidated net income available to common stockholders divided by average SVBFG stockholders’ equity.
|
(5)
|
See “Capital Resources–Capital Ratios” for a reconciliation of non-GAAP tangible common equity to tangible assets and tangible common equity to risk-weighted assets.
|
(6)
|
The operating efficiency ratio is calculated by dividing total noninterest expense by total net interest income plus noninterest income.
|
(7)
|
Book value per common share is calculated by dividing total SVBFG stockholders’ equity by total outstanding common shares at period-end.
|
|
|
December 31,
|
||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||
(Dollars in thousands)
|
|
Total Balance
|
|
Level 3
|
|
Total Balance
|
|
Level 3
|
||||||||
Assets carried at fair value
|
|
$
|
8,388,011
|
|
|
$
|
146,278
|
|
|
$
|
11,481,237
|
|
|
$
|
122,250
|
|
As a percentage of total assets
|
|
14.7
|
%
|
|
0.3
|
%
|
|
22.4
|
%
|
|
0.2
|
%
|
||||
Liabilities carried at fair value
|
|
$
|
98,050
|
|
|
$
|
—
|
|
|
$
|
108,581
|
|
|
$
|
—
|
|
As a percentage of total liabilities
|
|
0.2
|
%
|
|
—
|
%
|
|
0.2
|
%
|
|
—
|
%
|
||||
As a percentage of assets carried at fair value
|
|
|
|
|
1.7
|
|
|
|
|
1.1
|
|
|
|
2018 compared to 2017
|
|
2017 compared to 2016
|
||||||||||||||||||||
|
|
Change due to
|
|
Change due to
|
||||||||||||||||||||
(Dollars in thousands)
|
|
Volume
|
|
Rate
|
|
Total
|
|
Volume
|
|
Rate
|
|
Total
|
||||||||||||
Interest income:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Federal Reserve deposits, federal funds sold, securities purchased under agreements to resell and other short-term investment securities
|
|
$
|
(3,606
|
)
|
|
$
|
17,309
|
|
|
$
|
13,703
|
|
|
$
|
3,952
|
|
|
$
|
7,483
|
|
|
$
|
11,435
|
|
Fixed income investment portfolio (taxable)
|
|
53,911
|
|
|
75,561
|
|
|
129,472
|
|
|
27,671
|
|
|
37,525
|
|
|
65,196
|
|
||||||
Fixed income investment portfolio (non-taxable)
|
|
35,132
|
|
|
(105
|
)
|
|
35,027
|
|
|
6,627
|
|
|
(1,274
|
)
|
|
5,353
|
|
||||||
Loans, net of unearned income
|
|
236,981
|
|
|
95,711
|
|
|
332,692
|
|
|
139,416
|
|
|
52,217
|
|
|
191,633
|
|
||||||
Increase in interest income, net
|
|
322,418
|
|
|
188,476
|
|
|
510,894
|
|
|
177,666
|
|
|
95,951
|
|
|
273,617
|
|
||||||
Interest expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest bearing checking and savings accounts
|
|
118
|
|
|
11
|
|
|
129
|
|
|
90
|
|
|
(2
|
)
|
|
88
|
|
||||||
Money market deposits
|
|
3,634
|
|
|
16,308
|
|
|
19,942
|
|
|
(5
|
)
|
|
3,071
|
|
|
3,066
|
|
||||||
Money market deposits in foreign offices
|
|
(5
|
)
|
|
(3
|
)
|
|
(8
|
)
|
|
22
|
|
|
(4
|
)
|
|
18
|
|
||||||
Time deposits
|
|
24
|
|
|
28
|
|
|
52
|
|
|
(11
|
)
|
|
—
|
|
|
(11
|
)
|
||||||
Sweep deposits in foreign offices
|
|
(81
|
)
|
|
596
|
|
|
515
|
|
|
(86
|
)
|
|
(10
|
)
|
|
(96
|
)
|
||||||
Total increase in deposits expense
|
|
3,690
|
|
|
16,940
|
|
|
20,630
|
|
|
10
|
|
|
3,055
|
|
|
3,065
|
|
||||||
Short-term borrowings
|
|
13,481
|
|
|
555
|
|
|
14,036
|
|
|
(1,922
|
)
|
|
1,378
|
|
|
(544
|
)
|
||||||
3.50% Senior Notes
|
|
12
|
|
|
—
|
|
|
12
|
|
|
12
|
|
|
—
|
|
|
12
|
|
||||||
5.375% Senior Notes
|
|
35
|
|
|
—
|
|
|
35
|
|
|
32
|
|
|
—
|
|
|
32
|
|
||||||
7.0% Junior Subordinated Debentures
|
|
(3,096
|
)
|
|
—
|
|
|
(3,096
|
)
|
|
(106
|
)
|
|
(122
|
)
|
|
(228
|
)
|
||||||
6.05% Subordinated Notes
|
|
(467
|
)
|
|
—
|
|
|
(467
|
)
|
|
(693
|
)
|
|
254
|
|
|
(439
|
)
|
||||||
Total increase (decrease) in borrowings expense
|
|
9,965
|
|
|
555
|
|
|
10,520
|
|
|
(2,677
|
)
|
|
1,510
|
|
|
(1,167
|
)
|
||||||
Increase (decrease) in interest expense, net
|
|
13,655
|
|
|
17,495
|
|
|
31,150
|
|
|
(2,667
|
)
|
|
4,565
|
|
|
1,898
|
|
||||||
Increase in net interest income
|
|
$
|
308,763
|
|
|
$
|
170,981
|
|
|
$
|
479,744
|
|
|
$
|
180,333
|
|
|
$
|
91,386
|
|
|
$
|
271,719
|
|
•
|
Interest income
for
2018
increased by
$510.9 million
primarily due to:
|
◦
|
A
$332.7 million
increase in interest income from loans to
$1.4 billion
in
2018
, compared to
$1.0 billion
in
2017
. This increase was reflective of an increase in average loan balances of $
4.5 billion
and an increase in the overall yield on our loan portfolio of
45
basis points to 5.30 percent from 4.85 percent. Gross loan yields, excluding loan interest recoveries and loan fees, increased by 55 basis points to 4.77 percent from 4.22 percent, reflective of the benefit of interest rate increases, partially offset by the strong growth of our lower yielding private equity/venture capital loan portfolio. Our private equity/venture capital portfolio represented
49.5
percent and
42.8
percent of our total gross loan portfolio at December 31, 2018 and 2017, respectively,
|
◦
|
A
$164.5 million
increase in interest income from our fixed income investment securities to
$585.4 million
in
2018
, compared to
$420.9 million
in
2017
. The increase was reflective of an increase of $2.4 billion in average fixed income investment balances as a result of strong deposit growth in 2018 and an increase in our fixed income securities yield of 48 basis points to 2.36 percent from 1.88 percent. The increase in our fixed income securities yield was primarily from higher reinvestment yields on maturing fixed income investments as well as higher yields on new purchases due to interest rate increases, and
|
◦
|
A
$13.7 million
increase in interest income from our Federal Reserve deposits to
$35.2 million
, compared to
$21.5 million
in
2017
. The increase was due primarily to higher yields as a result of rate increases in 2018.
|
•
|
Interest expense
for
2018
increased to
$75.9 million
, compared to
$44.8 million
for
2017
, primarily due to:
|
◦
|
A $20.6 million increase in deposits interest expense, due primarily to an increase in interest paid on our interest-bearing money market deposits as a result of market rate adjustments, and
|
◦
|
A $10.5 million increase in borrowings interest expense, due primarily to an increase in our average short-term borrowings balance during 2018 to fund loan growth as a result of the timing of loan funding and deposit activities. The increase in interest expense from short-term borrowings was partially offset by a decrease in interest expense from long-term debt reflective of the repayment of our 6.05% Subordinated Notes and the redemption of our Junior Subordinated Debentures in 2017.
|
•
|
Interest income
for
2017
increased by
$273.6 million
primarily due to:
|
◦
|
A
$191.6 million
increase in interest income from loans to
$1.0 billion
in
2017
, compared to
$834.2 million
in
2016
. This increase was reflective of an increase in average loan balances of $2.9 billion and an increase in the overall yield on our loan portfolio of 29 basis points to 4.85 percent from 4.56 percent. Gross loan yields, excluding loan interest recoveries and loan fees, increased to 4.22 percent from 3.97 percent, reflective of the benefit of interest rate increases, partially offset by the strong growth of our lower yielding private equity/ venture capital and Private Bank loan portfolios. Our private equity/venture capital portfolio represented 42.8 percent and 38.7 percent of our total gross loan portfolio at December 31, 2017 and 2016, respectively. Our Private Bank loan portfolio represented 11.3 percent and 10.8 percent of our total gross loan portfolio at December 31, 2017 and 2016, respectively,
|
◦
|
A $70.5 million increase in interest income from our fixed income investment securities to $420.9 million in 2017, compared to $350.4 million in 2016. The increase was primarily reflective of an increase in our fixed income investment securities yield of 25 basis points to 1.88 percent from 1.63 percent resulting primarily from higher reinvestment yields on maturing fixed income investments as well as higher yields on new purchases due to interest rate increases. Interest income from our fixed income securities also benefited from an increase of $0.9 billion in average investment security balances as a result of strong deposit growth in 2017, and
|
◦
|
An $11.4 million increase in interest income from our Federal Reserve deposits to $21.5 million, compared to $10.1 million in 2016. The increase was due primarily to higher yields as a result of rate increases in 2017, as well as higher average interest-earning cash balances in 2017.
|
•
|
Interest expense
for 2017 increased to $44.8 million, compared to $42.9 million for 2016, due primarily to:
|
◦
|
A $3.1 million increase in deposits interest expense, due primarily to an increase in interest paid on our interest- bearing money market deposits as a result of market rate adjustments, and
|
◦
|
A $1.2 million decrease in borrowings interest expense, due to the repayment of our 6.05% Subordinated Notes and the redemption of our Junior Subordinated Debentures in 2017.
|
|
|
Year ended December 31,
|
|||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||||||||||||||
(Dollars in thousands)
|
|
Average
Balance
|
|
Interest
Income/
Expense
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
Income/
Expense
|
|
Yield/
Rate
|
|
Average
Balance
|
|
Interest
Income/
Expense
|
|
Yield/
Rate
|
|||||||||||||||
Interest-earning assets
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Federal Reserve deposits, federal funds sold, securities purchased under agreements to resell and other short-term investment securities (1)
|
|
$
|
2,820,883
|
|
|
$
|
35,208
|
|
|
1.25
|
%
|
|
$
|
3,109,840
|
|
|
$
|
21,505
|
|
|
0.69
|
%
|
|
$
|
2,538,362
|
|
|
$
|
10,070
|
|
|
0.40
|
%
|
Investment Securities: (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Taxable
|
|
9,789,211
|
|
|
185,120
|
|
|
1.89
|
|
|
12,424,137
|
|
|
199,423
|
|
|
1.61
|
|
|
13,331,315
|
|
|
185,981
|
|
|
1.40
|
|
||||||
Held-to-maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Taxable
|
|
13,727,745
|
|
|
356,485
|
|
|
2.60
|
|
|
9,732,869
|
|
|
212,710
|
|
|
2.19
|
|
|
8,130,221
|
|
|
160,956
|
|
|
1.98
|
|
||||||
Non-taxable (3)
|
|
1,270,101
|
|
|
43,817
|
|
|
3.45
|
|
|
251,741
|
|
|
8,790
|
|
|
3.49
|
|
|
61,962
|
|
|
3,437
|
|
|
5.55
|
|
||||||
Total loans, net of unearned income (4) (5)
|
|
25,630,520
|
|
|
1,358,480
|
|
|
5.30
|
|
|
21,159,394
|
|
|
1,025,788
|
|
|
4.85
|
|
|
18,283,591
|
|
|
834,155
|
|
|
4.56
|
|
||||||
Total interest-earning assets
|
|
53,238,460
|
|
|
1,979,110
|
|
|
3.71
|
|
|
46,677,981
|
|
|
1,468,216
|
|
|
3.15
|
|
|
42,345,451
|
|
|
1,194,599
|
|
|
2.82
|
|
||||||
Cash and due from banks
|
|
480,900
|
|
|
|
|
|
|
374,811
|
|
|
|
|
|
|
325,415
|
|
|
|
|
|
||||||||||||
Allowance for loan losses
|
|
(282,489
|
)
|
|
|
|
|
|
(247,004
|
)
|
|
|
|
|
|
(236,936
|
)
|
|
|
|
|
||||||||||||
Other assets (6)
|
|
1,792,189
|
|
|
|
|
|
|
1,574,484
|
|
|
|
|
|
|
1,553,521
|
|
|
|
|
|
||||||||||||
Total assets
|
|
$
|
55,229,060
|
|
|
|
|
|
|
$
|
48,380,272
|
|
|
|
|
|
|
$
|
43,987,451
|
|
|
|
|
|
|||||||||
Funding sources
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest bearing checking and savings accounts
|
|
$
|
583,295
|
|
|
$
|
463
|
|
|
0.08
|
%
|
|
$
|
433,966
|
|
|
$
|
334
|
|
|
0.08
|
%
|
|
$
|
318,381
|
|
|
$
|
246
|
|
|
0.08
|
%
|
Money market deposits
|
|
6,609,873
|
|
|
27,713
|
|
|
0.42
|
|
|
5,743,083
|
|
|
7,771
|
|
|
0.14
|
|
|
5,746,892
|
|
|
4,705
|
|
|
0.08
|
|
||||||
Money market deposits in foreign offices
|
|
192,128
|
|
|
76
|
|
|
0.04
|
|
|
203,775
|
|
|
84
|
|
|
0.04
|
|
|
152,388
|
|
|
66
|
|
|
0.04
|
|
||||||
Time deposits
|
|
62,570
|
|
|
111
|
|
|
0.18
|
|
|
48,818
|
|
|
59
|
|
|
0.12
|
|
|
58,071
|
|
|
70
|
|
|
0.12
|
|
||||||
Sweep deposits in foreign offices
|
|
994,360
|
|
|
943
|
|
|
0.09
|
|
|
1,080,306
|
|
|
428
|
|
|
0.04
|
|
|
1,294,109
|
|
|
524
|
|
|
0.04
|
|
||||||
Total interest-bearing deposits
|
|
8,442,226
|
|
|
29,306
|
|
|
0.35
|
|
|
7,509,948
|
|
|
8,676
|
|
|
0.12
|
|
|
7,569,841
|
|
|
5,611
|
|
|
0.07
|
|
||||||
Short-term borrowings
|
|
643,886
|
|
|
14,579
|
|
|
2.26
|
|
|
48,505
|
|
|
543
|
|
|
1.12
|
|
|
220,251
|
|
|
1,087
|
|
|
0.49
|
|
||||||
3.50% Senior Notes
|
|
347,458
|
|
|
12,586
|
|
|
3.62
|
|
|
347,128
|
|
|
12,574
|
|
|
3.62
|
|
|
346,810
|
|
|
12,562
|
|
|
3.62
|
|
||||||
5.375% Senior Notes
|
|
348,480
|
|
|
19,450
|
|
|
5.58
|
|
|
347,862
|
|
|
19,415
|
|
|
5.58
|
|
|
347,277
|
|
|
19,383
|
|
|
5.58
|
|
||||||
7.0% Junior Subordinated Debentures
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52,775
|
|
|
3,096
|
|
|
5.87
|
|
|
54,588
|
|
|
3,324
|
|
|
6.09
|
|
||||||
6.05% Subordinated Notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,178
|
|
|
467
|
|
|
2.44
|
|
|
47,627
|
|
|
906
|
|
|
1.90
|
|
||||||
Total interest-bearing liabilities
|
|
9,782,050
|
|
|
75,921
|
|
|
0.78
|
|
|
8,325,396
|
|
|
44,771
|
|
|
0.54
|
|
|
8,586,394
|
|
|
42,873
|
|
|
0.50
|
|
||||||
Portion of noninterest-bearing funding sources
|
|
43,456,410
|
|
|
|
|
|
|
38,352,585
|
|
|
|
|
|
|
33,759,057
|
|
|
|
|
|
||||||||||||
Total funding sources
|
|
53,238,460
|
|
|
75,921
|
|
|
0.14
|
|
|
46,677,981
|
|
|
44,771
|
|
|
0.10
|
|
|
42,345,451
|
|
|
42,873
|
|
|
0.10
|
|
||||||
Noninterest-bearing funding sources
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Demand deposits
|
|
39,633,118
|
|
|
|
|
|
|
35,235,200
|
|
|
|
|
|
|
31,189,218
|
|
|
|
|
|
||||||||||||
Other liabilities
|
|
937,199
|
|
|
|
|
|
|
721,432
|
|
|
|
|
|
|
571,205
|
|
|
|
|
|
||||||||||||
SVBFG stockholders’ equity
|
|
4,734,417
|
|
|
|
|
|
|
3,961,405
|
|
|
|
|
|
|
3,509,526
|
|
|
|
|
|
||||||||||||
Noncontrolling interests
|
|
142,276
|
|
|
|
|
|
|
136,839
|
|
|
|
|
|
|
131,108
|
|
|
|
|
|
||||||||||||
Portion used to fund interest-earning assets
|
|
(43,456,410
|
)
|
|
|
|
|
|
(38,352,585
|
)
|
|
|
|
|
|
(33,759,057
|
)
|
|
|
|
|
||||||||||||
Total liabilities and total equity
|
|
$
|
55,229,060
|
|
|
|
|
|
|
$
|
48,380,272
|
|
|
|
|
|
|
$
|
43,987,451
|
|
|
|
|
|
|||||||||
Net interest income and margin
|
|
|
|
$
|
1,903,189
|
|
|
3.57
|
%
|
|
|
|
$
|
1,423,445
|
|
|
3.05
|
%
|
|
|
|
$
|
1,151,726
|
|
|
2.72
|
%
|
||||||
Total deposits
|
|
$
|
48,075,344
|
|
|
|
|
|
|
$
|
42,745,148
|
|
|
|
|
|
|
$
|
38,759,059
|
|
|
|
|
|
|||||||||
Reconciliation to reported net interest income
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Adjustments for taxable equivalent basis
|
|
|
|
(9,201
|
)
|
|
|
|
|
|
(3,076
|
)
|
|
|
|
|
|
(1,203
|
)
|
|
|
||||||||||||
Net interest income, as reported
|
|
|
|
$
|
1,893,988
|
|
|
|
|
|
|
$
|
1,420,369
|
|
|
|
|
|
|
$
|
1,150,523
|
|
|
|
|
(1)
|
Includes average interest-earning deposits in other financial institutions of
$0.8 billion
,
$1.1 billion
and
$0.7 billion
in
2018
,
2017
and
2016
, respectively. For
2018
,
2017
and
2016
, balances also include
$1.6 billion
,
$1.9 billion
and
$1.8 billion
, respectively, deposited at the FRB, earning interest at the Federal Funds target rate.
|
(2)
|
Yields on interest-earning investment securities do not give effect to changes in fair value that are reflected in other comprehensive income.
|
(3)
|
Interest income on non-taxable investment securities is presented on a fully taxable equivalent basis using the federal statutory income tax rate of 21.0 percent for 2018 and 35.0 percent for 2017 and 2016.
|
(4)
|
Nonaccrual loans are reflected in the average balances of loans.
|
(5)
|
Interest income includes loan fees of
$136.6 million
,
$128.1 million
and
$104.9 million
in
2018
,
2017
and
2016
, respectively.
|
(6)
|
Average investment securities of
$773 million
,
$683 million
, and
$786 million
in
2018
,
2017
and
2016
, respectively, were classified as other assets as they were noninterest-earning assets. These investments primarily consisted of non-marketable and other equity securities.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Allowance for loan losses, beginning balance
|
|
$
|
255,024
|
|
|
$
|
225,366
|
|
|
$
|
217,613
|
|
Provision for loan losses (1)
|
|
84,292
|
|
|
85,939
|
|
|
95,697
|
|
|||
Gross loan charge-offs
|
|
(67,917
|
)
|
|
(66,682
|
)
|
|
(96,857
|
)
|
|||
Loan recoveries
|
|
11,636
|
|
|
8,538
|
|
|
12,212
|
|
|||
Foreign currency translation adjustments
|
|
(2,132
|
)
|
|
1,863
|
|
|
(3,299
|
)
|
|||
Allowance for loan losses, ending balance
|
|
$
|
280,903
|
|
|
$
|
255,024
|
|
|
$
|
225,366
|
|
Allowance for unfunded credit commitments, beginning balance
|
|
51,770
|
|
|
45,265
|
|
|
34,415
|
|
|||
Provision for unfunded credit commitments (1)
|
|
3,578
|
|
|
6,365
|
|
|
10,982
|
|
|||
Foreign currency translation adjustments
|
|
(165
|
)
|
|
140
|
|
|
(132
|
)
|
|||
Allowance for unfunded credit commitments, ending balance (2)
|
|
$
|
55,183
|
|
|
$
|
51,770
|
|
|
$
|
45,265
|
|
Ratios and other information:
|
|
|
|
|
|
|
||||||
Provision for loan losses as a percentage of period-end total gross loans
|
|
0.30
|
%
|
|
0.37
|
%
|
|
0.48
|
%
|
|||
Gross loan charge-offs as a percentage of average total gross loans
|
|
0.26
|
|
|
0.31
|
|
|
0.53
|
|
|||
Net loan charge-offs as a percentage of average total gross loans
|
|
0.22
|
|
|
0.27
|
|
|
0.46
|
|
|||
Allowance for loan losses as a percentage of period-end total gross loans
|
|
0.99
|
|
|
1.10
|
|
|
1.13
|
|
|||
Provision for credit losses (1)
|
|
$
|
87,870
|
|
|
$
|
92,304
|
|
|
$
|
106,679
|
|
Period-end total gross loans
|
|
28,511,312
|
|
|
23,254,153
|
|
|
20,024,662
|
|
|||
Average total gross loans
|
|
25,790,949
|
|
|
21,287,336
|
|
|
18,396,256
|
|
|
(1)
|
Our consolidated statement of income for the year ended December 31, 2016 was modified from prior period's presentation to conform to the current period presentation, which reflect our provision for loan losses and provision for unfunded credit commitments together as our “provision for credit losses.”
|
(2)
|
The “allowance for unfunded credit commitments” is included as a component of “Other liabilities.”
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
GAAP noninterest income
|
|
$
|
744,984
|
|
|
$
|
557,231
|
|
|
33.7
|
%
|
|
$
|
456,552
|
|
|
22.1
|
%
|
Less: income attributable to noncontrolling interests, including carried interest allocation
|
|
38,000
|
|
|
29,452
|
|
|
29.0
|
|
|
8,039
|
|
|
NM
|
|
|||
Non-GAAP noninterest income, net of noncontrolling interests
|
|
$
|
706,984
|
|
|
$
|
527,779
|
|
|
34.0
|
|
|
$
|
448,513
|
|
|
17.7
|
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
GAAP noninterest income
|
|
$
|
744,984
|
|
|
$
|
557,231
|
|
|
33.7
|
%
|
|
$
|
456,552
|
|
|
22.1
|
%
|
Less: gains on investment securities, net
|
|
88,094
|
|
|
64,603
|
|
|
36.4
|
|
|
51,740
|
|
|
24.9
|
|
|||
Less: gains on equity warrant assets, net
|
|
89,142
|
|
|
54,555
|
|
|
63.4
|
|
|
37,892
|
|
|
44.0
|
|
|||
Less: other noninterest income
|
|
51,858
|
|
|
59,110
|
|
|
(12.3
|
)
|
|
50,750
|
|
|
16.5
|
|
|||
Non-GAAP core fee income (1)
|
|
$
|
515,890
|
|
|
$
|
378,963
|
|
|
36.1
|
|
|
$
|
316,170
|
|
|
19.9
|
|
|
(1)
|
Non-GAAP core fee income represents noninterest income, but excludes certain line items where performance is typically subject to market or other conditions beyond our control and includes foreign exchange fees, credit card fees, deposit service charges, lending related fees, client investment fees and letters of credit fees.
|
•
|
Gains of
$39.9 million
from our strategic and other investments portfolio, primarily driven by net unrealized valuation increases in both private and public company investments held in our strategic venture capital funds,
|
•
|
Gains of
$29.1 million
from our managed funds of funds portfolio, related primarily to net unrealized valuation increases in both private and public company investments held by the funds in the portfolio, and
|
•
|
Losses of
$25.2 million
from our public equity securities portfolio primarily reflective of net losses on sales of shares of Roku, Inc. ("Roku"), from exercised warrants in 2017, which were sold in the first quarter of 2018.
|
•
|
Gains of $17.9 million from our strategic and other investments portfolio, primarily driven by distribution gains from our strategic venture capital fund investments and $3.4 million related to the sale of certain shares relating to one of our direct equity investments,
|
•
|
Gains of $13.0 million from our managed funds of funds portfolio, related primarily to net unrealized valuation increases in the investments held by the funds driven by IPO, M&A and private equity-backed financing activity,
|
•
|
Gains of $9.0 million from our debt funds portfolio, related to net unrealized valuation increases in the investments held by the funds primarily driven by gains of $9.5 million related to the fund's holdings of Roku, which had an IPO during the third quarter of 2017, and
|
•
|
Losses of $5.2 million from our AFS securities portfolio primarily reflective of $8.8 million of net losses on the sale of approximately $0.6 billion of mortgage-backed securities during the fourth quarter of 2017, partially offset by net gains on sales of shares from exercised warrants in public companies upon expiration of lock-up periods during the quarter.
|
(Dollars in thousands)
|
|
Managed
Funds of
Funds
|
|
Managed
Direct
Venture
Funds
|
|
Public Equity Securities (1)
|
|
Debt
Funds
|
|
Sales of AFS
Securities (1)
|
|
Strategic
and Other
Investments
|
|
Total
|
||||||||||||||
Year ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
GAAP gains (losses) on investment securities, net
|
|
$
|
62,019
|
|
|
$
|
11,502
|
|
|
$
|
(25,158
|
)
|
|
$
|
541
|
|
|
$
|
(740
|
)
|
|
$
|
39,930
|
|
|
$
|
88,094
|
|
Less: gains attributable to noncontrolling interests, including carried interest allocation
|
|
32,938
|
|
|
5,245
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,183
|
|
|||||||
Non-GAAP net gains (losses) on investment securities, net of noncontrolling interests
|
|
$
|
29,081
|
|
|
$
|
6,257
|
|
|
$
|
(25,158
|
)
|
|
$
|
541
|
|
|
$
|
(740
|
)
|
|
$
|
39,930
|
|
|
$
|
49,911
|
|
Year ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
GAAP gains (losses) on investment securities, net
|
|
$
|
41,140
|
|
|
$
|
1,823
|
|
|
$
|
—
|
|
|
$
|
8,950
|
|
|
$
|
(5,189
|
)
|
|
$
|
17,879
|
|
|
$
|
64,603
|
|
Less: gains attributable to noncontrolling interests, including carried interest allocation
|
|
28,108
|
|
|
1,079
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29,187
|
|
|||||||
Non-GAAP net gains (losses) on investment securities, net of noncontrolling interests
|
|
$
|
13,032
|
|
|
$
|
744
|
|
|
$
|
—
|
|
|
$
|
8,950
|
|
|
$
|
(5,189
|
)
|
|
$
|
17,879
|
|
|
$
|
35,416
|
|
Year ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
GAAP gains (losses) on investment securities, net
|
|
$
|
10,139
|
|
|
$
|
(171
|
)
|
|
$
|
—
|
|
|
$
|
948
|
|
|
$
|
12,195
|
|
|
$
|
28,629
|
|
|
$
|
51,740
|
|
Less: gains attributable to noncontrolling interests, including carried interest allocation
|
|
8,220
|
|
|
92
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,312
|
|
|||||||
Non-GAAP net gains (losses) on investment securities, net of noncontrolling interests
|
|
$
|
1,919
|
|
|
$
|
(263
|
)
|
|
$
|
—
|
|
|
$
|
948
|
|
|
$
|
12,195
|
|
|
$
|
28,629
|
|
|
$
|
43,428
|
|
|
(1)
|
Effective January 1, 2018, we adopted Accounting Standards Update ("ASU") 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, resulting in the reclassification of public equity securities out of our AFS securities portfolio into our non-marketable and other equity securities portfolio. This guidance was adopted using the modified retrospective method with a cumulative adjustment to opening retained earnings. As such, prior period amounts have not been restated.
|
•
|
Net gains on
$58.2 million
from the exercises of equity warrant assets in
2018
, compared to net gains of $48.3 million in 2017, driven by increased M&A and IPO activity during 2018, and
|
•
|
Net gains of
$36.9 million
from changes in warrant valuations in
2018
, compared to net gains of $10.7 million in 2017, driven by valuation increases in our private company warrant portfolio and reflective of increased M&A activity during 2018.
|
•
|
Net gains on $48.3 million from the exercises of equity warrant assets in
2017
, compared to net gains of $31.2 million in 2016, driven by net gains of $20.7 million from Roku warrants and from increased M&A and IPO activity during 2017, and
|
•
|
Net gains of $10.7 million from changes in warrant valuations in
2017
, compared to net gains of $9.7 million in 2016, driven by changes in valuations from our private company warrant portfolio during 2017.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Equity warrant assets (1):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gains on exercises, net
|
|
$
|
58,186
|
|
|
$
|
48,275
|
|
|
20.5
|
%
|
|
$
|
31,197
|
|
|
54.7
|
%
|
Terminations
|
|
(5,964
|
)
|
|
(4,422
|
)
|
|
34.9
|
|
|
(3,015
|
)
|
|
46.7
|
|
|||
Changes in fair value, net
|
|
36,920
|
|
|
10,702
|
|
|
NM
|
|
|
9,710
|
|
|
10.2
|
|
|||
Total gains on equity warrant assets, net
|
|
$
|
89,142
|
|
|
$
|
54,555
|
|
|
63.4
|
|
|
$
|
37,892
|
|
|
44.0
|
|
|
(1)
|
At
December 31, 2018
, we held warrants in
2,095
companies, compared to
1,868
companies at
December 31, 2017
and
1,739
companies at
December 31, 2016
. The total value of our warrant portfolio was $149.2 million at December 31, 2018, $123.8 million at December 31, 2017, and $131.1 million at December 31, 2016. Warrants in 18 companies each had fair values greater than $1.0 million and collectively represented $46.9 million, or 31.4 percent, of the fair value of the total warrant portfolio at December 31, 2018.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Non-GAAP core fee income (1):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange fees
|
|
$
|
138,812
|
|
|
$
|
115,760
|
|
|
19.9
|
%
|
|
$
|
104,183
|
|
|
11.1
|
%
|
Credit card fees
|
|
94,072
|
|
|
76,543
|
|
|
22.9
|
|
|
68,205
|
|
|
12.2
|
|
|||
Deposit service charges
|
|
76,097
|
|
|
58,715
|
|
|
29.6
|
|
|
52,524
|
|
|
11.8
|
|
|||
Client investment fees
|
|
130,360
|
|
|
56,136
|
|
|
132.2
|
|
|
32,219
|
|
|
74.2
|
|
|||
Lending related fees
|
|
41,949
|
|
|
43,265
|
|
|
(3.0
|
)
|
|
33,395
|
|
|
29.6
|
|
|||
Letters of credit and standby letters of credit fees
|
|
34,600
|
|
|
28,544
|
|
|
21.2
|
|
|
25,644
|
|
|
11.3
|
|
|||
Total non-GAAP core fee income (1)
|
|
$
|
515,890
|
|
|
$
|
378,963
|
|
|
36.1
|
|
|
$
|
316,170
|
|
|
19.9
|
|
|
(1)
|
This non-GAAP measure represents noninterest income, but excludes certain line items where performance is typically subject to market or other conditions beyond our control. See "Use of Non-GAAP Measures" above.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Foreign exchange fees by instrument type:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Spot contract commissions
|
|
$
|
127,459
|
|
|
$
|
104,344
|
|
|
22.2
|
%
|
|
$
|
89,354
|
|
|
16.8
|
%
|
Forward contract commissions
|
|
10,940
|
|
|
10,934
|
|
|
0.1
|
|
|
14,004
|
|
|
(21.9
|
)
|
|||
Option premium fees
|
|
413
|
|
|
482
|
|
|
(14.3
|
)
|
|
825
|
|
|
(41.6
|
)
|
|||
Total foreign exchange fees
|
|
$
|
138,812
|
|
|
$
|
115,760
|
|
|
19.9
|
|
|
$
|
104,183
|
|
|
11.1
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Credit card fees by instrument type:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Card interchange fees, net
|
|
$
|
74,381
|
|
|
$
|
60,224
|
|
|
23.5
|
%
|
|
$
|
51,513
|
|
|
16.9
|
%
|
Merchant service fees
|
|
14,420
|
|
|
11,584
|
|
|
24.5
|
|
|
12,783
|
|
|
(9.4
|
)
|
|||
Card service fees
|
|
5,271
|
|
|
4,735
|
|
|
11.3
|
|
|
3,909
|
|
|
21.1
|
|
|||
Total credit card fees
|
|
$
|
94,072
|
|
|
$
|
76,543
|
|
|
22.9
|
|
|
$
|
68,205
|
|
|
12.2
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Client investment fees by type:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Sweep money market fees
|
|
$
|
75,654
|
|
|
$
|
28,485
|
|
|
165.6
|
%
|
|
$
|
15,147
|
|
|
88.1
|
%
|
Asset management fees
|
|
23,882
|
|
|
16,831
|
|
|
41.9
|
|
|
15,389
|
|
|
9.4
|
|
|||
Repurchase agreement fees
|
|
30,824
|
|
|
10,820
|
|
|
184.9
|
|
|
1,683
|
|
|
NM
|
|
|||
Total client investment fees
|
|
$
|
130,360
|
|
|
$
|
56,136
|
|
|
132.2
|
|
|
$
|
32,219
|
|
|
74.2
|
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in millions)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Sweep money market funds
|
|
$
|
32,232
|
|
|
$
|
19,718
|
|
|
63.5
|
%
|
|
$
|
15,122
|
|
|
30.4
|
%
|
Client investment assets under management (1)
|
|
34,754
|
|
|
25,417
|
|
|
36.7
|
|
|
21,287
|
|
|
19.4
|
|
|||
Repurchase agreements
|
|
8,086
|
|
|
6,390
|
|
|
26.5
|
|
|
6,948
|
|
|
(8.0
|
)
|
|||
Total average client investment funds (2)
|
|
$
|
75,072
|
|
|
$
|
51,525
|
|
|
45.7
|
|
|
$
|
43,357
|
|
|
18.8
|
|
|
(1)
|
These funds represent investments in third-party money market mutual funds and fixed income securities managed by SVB Asset Management.
|
(2)
|
Client investment funds are maintained at third-party financial institutions and are not recorded on our balance sheet.
|
|
|
December 31,
|
||||||||||||||||
(Dollars in millions)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Sweep money market funds
|
|
$
|
38,348
|
|
|
$
|
23,911
|
|
|
60.4
|
%
|
|
$
|
17,173
|
|
|
39.2
|
%
|
Client investment assets under management (1)
|
|
39,214
|
|
|
29,344
|
|
|
33.6
|
|
|
23,115
|
|
|
26.9
|
|
|||
Repurchase agreements
|
|
8,422
|
|
|
7,074
|
|
|
19.1
|
|
|
5,510
|
|
|
28.4
|
|
|||
Total period-end client investment funds (2)
|
|
$
|
85,984
|
|
|
$
|
60,329
|
|
|
42.5
|
|
|
$
|
45,798
|
|
|
31.7
|
|
|
(1)
|
These funds represent investments in third-party money market mutual funds and fixed income securities managed by SVB Asset Management.
|
(2)
|
Client investment funds are maintained at third-party financial institutions and are not recorded on our balance sheet.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Lending related fees by instrument type:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Unused commitment fees
|
|
$
|
32,452
|
|
|
$
|
34,110
|
|
|
(4.9
|
)%
|
|
$
|
25,654
|
|
|
33.0
|
%
|
Other
|
|
9,497
|
|
|
9,155
|
|
|
3.7
|
|
|
7,741
|
|
|
18.3
|
|
|||
Total lending related fees
|
|
$
|
41,949
|
|
|
$
|
43,265
|
|
|
(3.0
|
)
|
|
$
|
33,395
|
|
|
29.6
|
|
•
|
Higher fund management fees of $21.2 million, as compared to fees of $19.2 million for the comparable 2016 period, attributable primarily to the addition of new managed funds at SVB Capital,
|
•
|
An increase of $6.7 million from correspondent bank rebate income and FHLB/FRB stock dividend income, and
|
•
|
Service-based fee income decreased $4.1 million during 2017 as compared to 2016 primarily due to the sale of our equity valuation services business during 2017.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Fund management fees
|
|
$
|
23,016
|
|
|
$
|
21,214
|
|
|
8.5
|
%
|
|
$
|
19,195
|
|
|
10.5
|
%
|
Net gains (losses) on revaluation of foreign currency instruments, net of foreign exchange forward contracts (1)
|
|
666
|
|
|
1,788
|
|
|
(62.8
|
)
|
|
(1,999
|
)
|
|
(189.4
|
)
|
|||
Other service revenue
|
|
28,176
|
|
|
36,108
|
|
|
(22.0
|
)
|
|
33,554
|
|
|
7.6
|
|
|||
Total other noninterest income
|
|
$
|
51,858
|
|
|
$
|
59,110
|
|
|
(12.3
|
)
|
|
$
|
50,750
|
|
|
16.5
|
|
|
(1)
|
Represents the net revaluation of client and internal foreign currency denominated financial instruments. We enter into foreign exchange forward contracts to economically reduce our foreign exchange exposure related to client and internal foreign currency denominated financial instruments.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Compensation and benefits
|
|
$
|
726,980
|
|
|
$
|
606,402
|
|
|
19.9
|
%
|
|
$
|
514,270
|
|
|
17.9
|
%
|
Professional services
|
|
158,835
|
|
|
121,935
|
|
|
30.3
|
|
|
94,982
|
|
|
28.4
|
|
|||
Premises and equipment
|
|
77,918
|
|
|
71,753
|
|
|
8.6
|
|
|
65,502
|
|
|
9.5
|
|
|||
Net occupancy
|
|
54,753
|
|
|
48,397
|
|
|
13.1
|
|
|
39,928
|
|
|
21.2
|
|
|||
Business development and travel
|
|
48,180
|
|
|
41,978
|
|
|
14.8
|
|
|
40,130
|
|
|
4.6
|
|
|||
FDIC and state assessments
|
|
34,276
|
|
|
35,069
|
|
|
(2.3
|
)
|
|
30,285
|
|
|
15.8
|
|
|||
Correspondent bank fees
|
|
13,713
|
|
|
12,976
|
|
|
5.7
|
|
|
12,457
|
|
|
4.2
|
|
|||
Other
|
|
73,538
|
|
|
72,145
|
|
|
1.9
|
|
|
62,243
|
|
|
15.9
|
|
|||
Total noninterest expense (1)
|
|
$
|
1,188,193
|
|
|
$
|
1,010,655
|
|
|
17.6
|
|
|
$
|
859,797
|
|
|
17.5
|
|
|
(1)
|
Our consolidated statement of income for the year ended December 31, 2016 was modified from prior period's presentation to conform to the current period presentation, which reflect our provision for loan losses and provision for unfunded credit commitments together as our “provision for credit losses.” In prior periods, our provision for unfunded credit commitments were reported separately as a component of noninterest expense.
|
|
|
Year ended December 31,
|
||||||||||||||||
Non-GAAP operating efficiency ratio, net of noncontrolling interests (Dollars in thousands, except ratios)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
GAAP noninterest expense
|
|
$
|
1,188,193
|
|
|
$
|
1,010,655
|
|
|
17.6
|
%
|
|
$
|
859,797
|
|
|
17.5
|
%
|
Less: expense attributable to noncontrolling interests
|
|
522
|
|
|
813
|
|
|
(35.8
|
)
|
|
524
|
|
|
55.2
|
|
|||
Non-GAAP noninterest expense, net of noncontrolling interests
|
|
$
|
1,187,671
|
|
|
$
|
1,009,842
|
|
|
17.6
|
|
|
$
|
859,273
|
|
|
17.5
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP net interest income
|
|
$
|
1,893,988
|
|
|
$
|
1,420,369
|
|
|
33.3
|
|
|
$
|
1,150,523
|
|
|
23.5
|
|
Adjustments for taxable equivalent basis
|
|
9,201
|
|
|
3,076
|
|
|
199.1
|
|
|
1,203
|
|
|
155.7
|
|
|||
Non-GAAP taxable equivalent net interest income
|
|
$
|
1,903,189
|
|
|
$
|
1,423,445
|
|
|
33.7
|
|
|
$
|
1,151,726
|
|
|
23.6
|
|
Less: net interest income attributable to noncontrolling interests
|
|
30
|
|
|
33
|
|
|
(9.1
|
)
|
|
66
|
|
|
(50.0
|
)
|
|||
Non-GAAP taxable equivalent net interest income, net of noncontrolling interests
|
|
$
|
1,903,159
|
|
|
$
|
1,423,412
|
|
|
33.7
|
|
|
$
|
1,151,660
|
|
|
23.6
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP noninterest income
|
|
$
|
744,984
|
|
|
$
|
557,231
|
|
|
33.7
|
|
|
$
|
456,552
|
|
|
22.1
|
|
Less: income attributable to noncontrolling interests
|
|
38,000
|
|
|
29,452
|
|
|
29.0
|
|
|
8,039
|
|
|
NM
|
|
|||
Non-GAAP noninterest income, net of noncontrolling interests
|
|
$
|
706,984
|
|
|
$
|
527,779
|
|
|
34.0
|
|
|
$
|
448,513
|
|
|
17.7
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP total revenue
|
|
$
|
2,638,972
|
|
|
$
|
1,977,600
|
|
|
33.4
|
|
|
$
|
1,607,075
|
|
|
23.1
|
|
Non-GAAP taxable equivalent revenue, net of noncontrolling interests
|
|
$
|
2,610,143
|
|
|
$
|
1,951,191
|
|
|
33.8
|
|
|
$
|
1,600,173
|
|
|
21.9
|
|
GAAP operating efficiency ratio
|
|
45.02
|
%
|
|
51.11
|
%
|
|
(11.9
|
)
|
|
53.50
|
%
|
|
(4.5
|
)
|
|||
Non-GAAP operating efficiency ratio (1)
|
|
45.50
|
|
|
51.76
|
|
|
(12.1
|
)
|
|
53.70
|
|
|
(3.6
|
)
|
|
(1)
|
The non-GAAP operating efficiency ratio is calculated by dividing non-GAAP noninterest expense, net of noncontrolling interests, by non-GAAP total taxable equivalent revenue, net of noncontrolling interests.
|
|
|
Year ended December 31,
|
||||||||||||||||
Non-GAAP core operating efficiency ratio (Dollars in thousands, except ratios)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
GAAP noninterest expense
|
|
$
|
1,188,193
|
|
|
$
|
1,010,655
|
|
|
17.6
|
%
|
|
$
|
859,797
|
|
|
17.5
|
%
|
GAAP net interest income
|
|
$
|
1,893,988
|
|
|
$
|
1,420,369
|
|
|
33.3
|
|
|
$
|
1,150,523
|
|
|
23.5
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP noninterest income
|
|
$
|
744,984
|
|
|
$
|
557,231
|
|
|
33.7
|
|
|
$
|
456,552
|
|
|
22.1
|
|
Less: gains on investment securities, net
|
|
88,094
|
|
|
64,603
|
|
|
36.4
|
|
|
51,740
|
|
|
24.9
|
|
|||
Less: net gains on equity warrant assets
|
|
89,142
|
|
|
54,555
|
|
|
63.4
|
|
|
37,892
|
|
|
44.0
|
|
|||
Non-GAAP noninterest income, net of gains on investment securities and equity warrant assets
|
|
$
|
567,748
|
|
|
$
|
438,073
|
|
|
29.6
|
|
|
$
|
366,920
|
|
|
19.4
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP total revenue
|
|
$
|
2,638,972
|
|
|
$
|
1,977,600
|
|
|
33.4
|
|
|
$
|
1,607,075
|
|
|
23.1
|
|
Non-GAAP total revenue, net of gains on investment securities and equity warrant assets
|
|
$
|
2,461,736
|
|
|
$
|
1,858,442
|
|
|
32.5
|
|
|
$
|
1,517,443
|
|
|
22.5
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP operating efficiency ratio
|
|
45.02
|
%
|
|
51.11
|
%
|
|
(11.9
|
)
|
|
53.50
|
%
|
|
(4.5
|
)
|
|||
Non-GAAP, core operating efficiency ratio (1)
|
|
48.27
|
|
|
54.38
|
|
|
(11.2
|
)
|
|
56.66
|
|
|
(4.0
|
)
|
|
(1)
|
The non-GAAP core operating efficiency ratio is calculated by dividing noninterest expense by total revenue, after adjusting for gains and losses on investment securities and equity warrant assets.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands, except employees)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Compensation and benefits:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Salaries and wages
|
|
$
|
324,971
|
|
|
$
|
277,148
|
|
|
17.3
|
%
|
|
$
|
244,470
|
|
|
13.4
|
%
|
Incentive compensation
|
|
200,871
|
|
|
144,626
|
|
|
38.9
|
|
|
119,589
|
|
|
20.9
|
|
|||
ESOP
|
|
6,435
|
|
|
4,720
|
|
|
36.3
|
|
|
3,159
|
|
|
49.4
|
|
|||
Other employee incentives and benefits (1)
|
|
194,703
|
|
|
179,908
|
|
|
8.2
|
|
|
147,052
|
|
|
22.3
|
|
|||
Total compensation and benefits
|
|
$
|
726,980
|
|
|
$
|
606,402
|
|
|
19.9
|
|
|
$
|
514,270
|
|
|
17.9
|
|
Period-end full-time equivalent employees
|
|
2,900
|
|
|
2,438
|
|
|
18.9
|
|
|
2,311
|
|
|
5.5
|
|
|||
Average full-time equivalent employees
|
|
2,685
|
|
|
2,396
|
|
|
12.1
|
|
|
2,225
|
|
|
7.7
|
|
|
(1)
|
Other employee incentives and benefits includes employer payroll taxes, group health and life insurance, share-based compensation, 401(k), warrant incentive and retention plans, agency fees and other employee-related expenses.
|
•
|
An increase of $56.3 million in incentive compensation expense due primarily to our strong 2018 full-year performance and reflective of our improved ROE relative to our peers, which is one of our key plan performance metrics,
|
•
|
An increase of $47.8 million in salaries and wages expense, reflective primarily of an increase in the number of average FTEs by
289
to
2,685
in
2018
, compared to
2,396
in
2017
, and annual pay raises. The increase in headcount was primarily to support our overall growth, and
|
•
|
An increase of $14.8 million in other employee compensation and benefits, related to various expenses, particularly share-based compensation reflective of the increase in our stock price as well as employer payroll taxes and group health and life insurance reflective of our increased headcount in 2018. These increases were partially offset by a decrease in our warrant incentive plan expense in 2018 compared to 2017 primarily reflective of our exercise of Roku equity warrants in the fourth quarter of 2017 which resulted in a large accrual of warrant incentive compensation expense in 2017 and subsequent decline of Roku's common stock price, which was sold in 2018, resulting in a lower warrant incentive payout than previously accrued for.
|
•
|
An increase of $32.9 million in other employee compensation and benefits, related to various expenses, particularly personnel contracting expenses, to support our growth both domestically and globally, as well as group health and life insurance and employer payroll taxes reflective of our increased headcount since 2016. The increase in other employee incentives and benefits also includes an increase of $10.4 million in warrant incentive plan expenses reflective of our 2017 equity warrant portfolio performance,
|
•
|
An increase of $32.7 million in salaries and wages expense, reflective primarily of an increase in the number of average FTEs by 171 to 2,396 in 2017, compared to 2,225 in 2016, and annual pay raises. The increase in headcount was primarily to support our overall growth, and
|
•
|
An increase of $26.6 million in expenses related to incentive compensation plans and ESOP expense due to our strong 2017 full-year performance and reflective of our improved ROE relative to our peers, which is one of our key plan performance metrics.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Lending and other client related processing costs
|
|
$
|
24,237
|
|
|
$
|
23,768
|
|
|
2.0
|
%
|
|
$
|
19,867
|
|
|
19.6
|
%
|
Telephone
|
|
9,404
|
|
|
10,647
|
|
|
(11.7
|
)
|
|
9,793
|
|
|
8.7
|
|
|||
Data processing services
|
|
10,811
|
|
|
10,251
|
|
|
5.5
|
|
|
9,014
|
|
|
13.7
|
|
|||
Dues and publications
|
|
4,605
|
|
|
3,263
|
|
|
41.1
|
|
|
2,828
|
|
|
15.4
|
|
|||
Postage and supplies
|
|
2,799
|
|
|
2,797
|
|
|
0.1
|
|
|
2,851
|
|
|
(1.9
|
)
|
|||
Other
|
|
21,682
|
|
|
21,419
|
|
|
1.2
|
|
|
17,890
|
|
|
19.7
|
|
|||
Total other noninterest expense
|
|
$
|
73,538
|
|
|
$
|
72,145
|
|
|
1.9
|
|
|
$
|
62,243
|
|
|
15.9
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Net interest income (1)
|
|
$
|
(30
|
)
|
|
$
|
(33
|
)
|
|
(9.1
|
)%
|
|
$
|
(66
|
)
|
|
(50.0
|
)%
|
Noninterest income (1)
|
|
(22,342
|
)
|
|
(25,789
|
)
|
|
(13.4
|
)
|
|
(5,434
|
)
|
|
NM
|
|
|||
Noninterest expense (1)
|
|
522
|
|
|
813
|
|
|
(35.8
|
)
|
|
524
|
|
|
55.2
|
|
|||
Carried interest allocation (2)
|
|
(15,658
|
)
|
|
(3,663
|
)
|
|
NM
|
|
|
(2,605
|
)
|
|
40.6
|
|
|||
Net income attributable to noncontrolling interests
|
|
$
|
(37,508
|
)
|
|
$
|
(28,672
|
)
|
|
30.8
|
|
|
$
|
(7,581
|
)
|
|
NM
|
|
|
(1)
|
Represents noncontrolling interests’ share in net interest income, noninterest income and noninterest expense.
|
(2)
|
Represents the preferred allocation of income (or change in income) earned by us as the general partner of certain consolidated funds.
|
•
|
Net gains on investment securities (including carried interest allocation) attributable to noncontrolling interests of
$38.2 million
($22.5 million excluding carried interest allocation) primarily from our managed funds of funds portfolio, related primarily to net unrealized valuation increases in both private and public company investments held by the funds in the portfolio, and
|
•
|
Noninterest expense of
$0.5 million
, primarily related to management fees paid by the noncontrolling interests to our subsidiaries that serve as the general partner.
|
•
|
Net gains on investment securities (including carried interest allocation) attributable to noncontrolling interests of $29.2 million ($25.5 million excluding carried interest allocation) primarily driven by gains in our managed funds of funds portfolio due to unrealized valuation increases driven by IPO, M&A and private equity-backed financing activity, and
|
•
|
Noninterest expense of $0.8 million, primarily related to management fees paid by the noncontrolling interests to our subsidiaries that serve as the general partner.
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Net interest income
|
|
$
|
1,623,488
|
|
|
$
|
1,274,366
|
|
|
27.4
|
%
|
|
$
|
1,040,712
|
|
|
22.5
|
%
|
Provision for credit losses
|
|
(80,953
|
)
|
|
(81,553
|
)
|
|
(0.7
|
)
|
|
(93,885
|
)
|
|
(13.1
|
)
|
|||
Noninterest income
|
|
444,647
|
|
|
363,759
|
|
|
22.2
|
|
|
318,366
|
|
|
14.3
|
|
|||
Noninterest expense
|
|
(793,159
|
)
|
|
(707,666
|
)
|
|
12.1
|
|
|
(630,655
|
)
|
|
12.2
|
|
|||
Income before income tax expense
|
|
$
|
1,194,023
|
|
|
$
|
848,906
|
|
|
40.7
|
|
|
$
|
634,538
|
|
|
33.8
|
|
Total average loans, net of unearned income
|
|
$
|
22,354,305
|
|
|
$
|
18,479,793
|
|
|
21.0
|
|
|
$
|
16,047,545
|
|
|
15.2
|
|
Total average assets
|
|
53,012,381
|
|
|
46,302,350
|
|
|
14.5
|
|
|
41,495,332
|
|
|
11.6
|
|
|||
Total average deposits
|
|
46,039,570
|
|
|
41,043,731
|
|
|
12.2
|
|
|
37,301,483
|
|
|
10.0
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Net interest income
|
|
$
|
64,902
|
|
|
$
|
58,131
|
|
|
11.6
|
%
|
|
$
|
53,582
|
|
|
8.5
|
%
|
Provision for credit losses
|
|
(3,339
|
)
|
|
(4,386
|
)
|
|
(23.9
|
)
|
|
(1,812
|
)
|
|
142.1
|
|
|||
Noninterest income
|
|
2,281
|
|
|
2,175
|
|
|
4.9
|
|
|
2,713
|
|
|
(19.8
|
)
|
|||
Noninterest expense
|
|
(25,064
|
)
|
|
(17,693
|
)
|
|
41.7
|
|
|
(12,379
|
)
|
|
42.9
|
|
|||
Income before income tax expense
|
|
$
|
38,780
|
|
|
$
|
38,227
|
|
|
1.4
|
|
|
$
|
42,104
|
|
|
(9.2
|
)
|
Total average loans, net of unearned income
|
|
$
|
2,850,271
|
|
|
$
|
2,423,078
|
|
|
17.6
|
|
|
$
|
2,025,381
|
|
|
19.6
|
|
Total average assets
|
|
2,546,904
|
|
|
2,449,763
|
|
|
4.0
|
|
|
2,047,513
|
|
|
19.6
|
|
|||
Total average deposits
|
|
1,502,308
|
|
|
1,303,542
|
|
|
15.2
|
|
|
1,133,425
|
|
|
15.0
|
|
|
|
Year ended December 31,
|
||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change 2018/2017
|
|
2016
|
|
% Change 2017/2016
|
||||||||
Net interest income (expense)
|
|
$
|
23
|
|
|
$
|
48
|
|
|
(52.1
|
)%
|
|
$
|
(49
|
)
|
|
(198.0
|
)%
|
Noninterest income
|
|
101,181
|
|
|
58,992
|
|
|
71.5
|
|
|
49,365
|
|
|
19.5
|
|
|||
Noninterest expense
|
|
(22,792
|
)
|
|
(19,340
|
)
|
|
17.8
|
|
|
(15,546
|
)
|
|
24.4
|
|
|||
Income before income tax expense
|
|
$
|
78,412
|
|
|
$
|
39,700
|
|
|
97.5
|
|
|
$
|
33,770
|
|
|
17.6
|
|
Total average assets
|
|
$
|
380,543
|
|
|
$
|
325,939
|
|
|
16.8
|
|
|
$
|
338,848
|
|
|
(3.8
|
)
|
•
|
Net gains on investment securities of
$69.8 million
in
2018
, compared to net gains of
$35.8 million
in
2017
. The net gains on investment securities of
$69.8 million
in
2018
were related to net unrealized valuation increases in both private and public company investments held in our strategic venture capital funds as well as in our managed funds of funds portfolio driven by IPO and M&A activity in 2018, and
|
•
|
Fund management fees of
$23.0 million
for
2018
, compared to
$21.2 million
in
2017
.
|
•
|
Net gains on investment securities of $35.8 million in
2017
, compared to net gains of $23.5 million in 2016. The net gains on investment securities of $35.8 million in
2017
were related to gains from distributions from our strategic venture capital fund investments and net unrealized valuation increases in the investments held by the funds in our managed funds of funds portfolio driven by IPO and M&A activity in 2017, and
|
•
|
Fund management fees of
$21.2 million
for
2017
, compared to
$19.2 million
in 2016.
|
|
|
December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Available-for-sale securities, at fair value:
|
|
|
|
|
|
|
||||||
U.S. Treasury securities
|
|
$
|
4,738,258
|
|
|
$
|
6,840,502
|
|
|
$
|
8,909,491
|
|
U.S. agency debentures
|
|
1,084,117
|
|
|
1,567,128
|
|
|
2,078,375
|
|
|||
Foreign government debt securities
|
|
5,812
|
|
|
—
|
|
|
—
|
|
|||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
1,880,218
|
|
|
2,267,035
|
|
|
1,152,665
|
|
|||
Agency-issued collateralized mortgage obligations—variable rate
|
|
81,638
|
|
|
373,730
|
|
|
474,283
|
|
|||
Equity securities
|
|
—
|
|
|
72,269
|
|
|
5,597
|
|
|||
Total available-for-sale securities
|
|
7,790,043
|
|
|
11,120,664
|
|
|
12,620,411
|
|
|||
Held-to-maturity securities, at amortized cost:
|
|
|
|
|
|
|
||||||
U.S. agency debentures
|
|
640,990
|
|
|
659,979
|
|
|
622,445
|
|
|||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
||||||
Agency-issued mortgage-backed securities
|
|
8,103,638
|
|
|
6,304,969
|
|
|
2,896,179
|
|
|||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
2,183,204
|
|
|
2,829,979
|
|
|
3,362,598
|
|
|||
Agency-issued collateralized mortgage obligations—variable rate
|
|
214,483
|
|
|
255,782
|
|
|
312,665
|
|
|||
Agency-issued commercial mortgage-backed securities
|
|
2,769,706
|
|
|
1,868,985
|
|
|
1,151,363
|
|
|||
Municipal bonds and notes
|
|
1,575,421
|
|
|
743,761
|
|
|
81,748
|
|
|||
Total held-to-maturity securities
|
|
15,487,442
|
|
|
12,663,455
|
|
|
8,426,998
|
|
|||
Non-marketable and other equity securities:
|
|
|
|
|
|
|
||||||
Non-marketable securities (fair value accounting):
|
|
|
|
|
|
|
||||||
Consolidated venture capital and private equity fund investments
|
|
118,333
|
|
|
128,111
|
|
|
143,689
|
|
|||
Unconsolidated venture capital and private equity fund investments
|
|
201,098
|
|
|
98,548
|
|
|
114,606
|
|
|||
Other investments without a readily determinable fair value
|
|
25,668
|
|
|
27,680
|
|
|
27,700
|
|
|||
Other equity securities in public companies (fair value accounting)
|
|
20,398
|
|
|
310
|
|
|
753
|
|
|||
Non-marketable securities (equity method accounting):
|
|
|
|
|
|
|
||||||
Venture capital and private equity fund investments
|
|
129,485
|
|
|
89,809
|
|
|
82,823
|
|
|||
Debt funds
|
|
5,826
|
|
|
21,183
|
|
|
17,020
|
|
|||
Other investments
|
|
121,721
|
|
|
111,198
|
|
|
123,514
|
|
|||
Investments in qualified affordable housing projects, net
|
|
318,575
|
|
|
174,214
|
|
|
112,447
|
|
|||
Total non-marketable and other equity securities
|
|
941,104
|
|
|
651,053
|
|
|
622,552
|
|
|||
Total investment securities
|
|
$
|
24,218,589
|
|
|
$
|
24,435,172
|
|
|
$
|
21,669,961
|
|
|
|
December 31, 2018
|
|||||||||||||||||||||||||||||||||
|
|
Total
|
|
One Year
or Less
|
|
After One
Year to
Five Years
|
|
After Five
Years to
Ten Years
|
|
After
Ten Years
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
|
Carrying
Value
|
|
Weighted
Average
Yield
|
|
Carrying
Value
|
|
Weighted
Average Yield |
|
Carrying
Value
|
|
Weighted
Average Yield |
|
Carrying
Value
|
|
Weighted
Average Yield |
|
Carrying
Value
|
|
Weighted
Average Yield |
|||||||||||||||
U.S. Treasury securities
|
|
$
|
4,738,258
|
|
|
1.81
|
%
|
|
$
|
1,765,333
|
|
|
1.47
|
%
|
|
$
|
2,524,484
|
|
|
1.85
|
%
|
|
$
|
448,441
|
|
|
2.95
|
%
|
|
$
|
—
|
|
|
—
|
%
|
U.S. agency debentures
|
|
1,084,117
|
|
|
1.83
|
|
|
665,750
|
|
|
1.49
|
|
|
418,367
|
|
|
2.36
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Foreign government debt securities
|
|
5,812
|
|
|
(0.65
|
)
|
|
—
|
|
|
—
|
|
|
5,812
|
|
|
(0.65
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Agency-issued collateralized mortgage obligations - fixed rate
|
|
1,880,218
|
|
|
2.59
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,030
|
|
|
2.76
|
|
|
1,864,188
|
|
|
2.58
|
|
|||||
Agency-issued collateralized mortgage obligations - variable rate
|
|
81,638
|
|
|
0.73
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81,638
|
|
|
0.73
|
|
|||||
Total
|
|
$
|
7,790,043
|
|
|
1.99
|
|
|
$
|
2,431,083
|
|
|
1.48
|
|
|
$
|
2,948,663
|
|
|
1.92
|
|
|
$
|
464,471
|
|
|
2.94
|
|
|
$
|
1,945,826
|
|
|
2.51
|
|
|
|
December 31, 2018
|
|||||||||||||||||||||||||||||||||
|
|
Total
|
|
One Year
or Less
|
|
After One Year to
Five Years
|
|
After Five Years to
Ten Years
|
|
After
Ten Years
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|||||||||||||||
U.S. agency debentures
|
|
$
|
640,990
|
|
|
2.65
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
104,550
|
|
|
2.63
|
%
|
|
$
|
536,440
|
|
|
2.66
|
%
|
|
$
|
—
|
|
|
—
|
%
|
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Agency-issued mortgage-backed securities
|
|
8,103,638
|
|
|
2.88
|
|
|
—
|
|
|
—
|
|
|
155,257
|
|
|
2.06
|
|
|
885,622
|
|
|
2.48
|
|
|
7,062,759
|
|
|
2.95
|
|
|||||
Agency-issued collateralized mortgage obligations - fixed rate
|
|
2,183,204
|
|
|
1.78
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
483,043
|
|
|
1.59
|
|
|
1,700,161
|
|
|
1.83
|
|
|||||
Agency-issued collateralized mortgage obligations - variable rate
|
|
214,483
|
|
|
0.74
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
214,483
|
|
|
0.74
|
|
|||||
Agency-issued commercial mortgage-backed securities
|
|
2,769,706
|
|
|
2.99
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,769,706
|
|
|
2.99
|
|
|||||
Municipal bonds and notes
|
|
1,575,421
|
|
|
3.60
|
|
|
9,725
|
|
|
2.80
|
|
|
75,379
|
|
|
2.06
|
|
|
307,184
|
|
|
2.73
|
|
|
1,183,133
|
|
|
3.94
|
|
|||||
Total
|
|
$
|
15,487,442
|
|
|
2.78
|
|
|
$
|
9,725
|
|
|
2.80
|
|
|
$
|
335,186
|
|
|
2.24
|
|
|
$
|
2,212,289
|
|
|
2.36
|
|
|
$
|
12,930,242
|
|
|
2.87
|
|
|
|
December 31,
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
(Dollars in thousands)
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG
|
||||||||||||
Non-marketable and other equity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-marketable securities (fair value accounting):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated venture capital and private equity fund investments (1)
|
|
$
|
118,333
|
|
|
$
|
30,235
|
|
|
$
|
128,111
|
|
|
$
|
33,044
|
|
|
$
|
143,689
|
|
|
$
|
40,682
|
|
Unconsolidated venture capital and private equity fund investments (2)
|
|
201,098
|
|
|
201,098
|
|
|
98,548
|
|
|
98,548
|
|
|
114,606
|
|
|
114,606
|
|
||||||
Other investments without a readily determinable fair value (3)
|
|
25,668
|
|
|
25,668
|
|
|
27,680
|
|
|
27,680
|
|
|
27,700
|
|
|
27,700
|
|
||||||
Other equity securities in public companies (fair value accounting) (4)
|
|
20,398
|
|
|
20,098
|
|
|
310
|
|
|
103
|
|
|
753
|
|
|
138
|
|
||||||
Non-marketable securities (equity method accounting) (5):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Venture capital and private equity fund investments
|
|
129,485
|
|
|
82,921
|
|
|
89,809
|
|
|
64,675
|
|
|
82,823
|
|
|
64,030
|
|
||||||
Debt funds
|
|
5,826
|
|
|
5,826
|
|
|
21,183
|
|
|
21,183
|
|
|
17,020
|
|
|
17,020
|
|
||||||
Other investments
|
|
121,721
|
|
|
121,721
|
|
|
111,198
|
|
|
111,198
|
|
|
123,514
|
|
|
123,514
|
|
||||||
Investments in qualified affordable housing projects, net
|
|
318,575
|
|
|
318,575
|
|
|
174,214
|
|
|
174,214
|
|
|
112,447
|
|
|
112,447
|
|
||||||
Total non-marketable and other equity securities
|
|
$
|
941,104
|
|
|
$
|
806,142
|
|
|
$
|
651,053
|
|
|
$
|
530,645
|
|
|
$
|
622,552
|
|
|
$
|
500,137
|
|
|
(1)
|
The following table shows the amounts of venture capital and private equity fund investments held by the following consolidated funds and amounts attributable to SVBFG for each fund at
December 31, 2018
,
2017
and
2016
:
|
|
|
December 31,
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
(Dollars in thousands)
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG |
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG |
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG |
||||||||||||
Strategic Investors Fund, LP
|
|
$
|
12,452
|
|
|
$
|
1,564
|
|
|
$
|
14,673
|
|
|
$
|
1,843
|
|
|
$
|
18,459
|
|
|
$
|
2,319
|
|
Capital Preferred Return Fund, LP
|
|
53,957
|
|
|
11,629
|
|
|
54,147
|
|
|
11,670
|
|
|
57,627
|
|
|
12,420
|
|
||||||
Growth Partners, LP
|
|
50,845
|
|
|
16,927
|
|
|
58,372
|
|
|
19,432
|
|
|
59,718
|
|
|
19,880
|
|
||||||
Other private equity funds (i)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,845
|
|
|
5,845
|
|
||||||
CP I, LP
|
|
1,079
|
|
|
115
|
|
|
919
|
|
|
99
|
|
|
2,040
|
|
|
218
|
|
||||||
Total consolidated venture capital and private equity fund investments
|
|
$
|
118,333
|
|
|
$
|
30,235
|
|
|
$
|
128,111
|
|
|
$
|
33,044
|
|
|
$
|
143,689
|
|
|
$
|
40,682
|
|
|
(i)
|
On January 3, 2017, the other private equity fund was closed resulting in an immaterial impact on the Company's financial statements.
|
(2)
|
The carrying values represented investments in
213
and
235
funds (primarily venture capital funds) at
December 31, 2018
and
December 31, 2017
, respectively, where our ownership interest is typically less than
5%
of the voting interests of each such fund and in which we do not have the ability to exercise significant influence over the partnerships operating activities and financial policies. Effective January 1, 2018, we adopted ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities which eliminated the concept of cost method accounting. On a prospective basis, we will carry our unconsolidated venture capital and private equity fund investments at fair value based on the fund investments' net asset values per share as obtained from the general partners of the investments. For each fund investment, we adjust the net asset value per share for differences between our measurement date and the date of the fund investment’s net asset value by using the most recently available financial information from the investee general partner, for example June 30th, for our September 30th consolidated financial statements, adjusted for any contributions paid, distributions received from the investment, and significant fund transactions or market events during the reporting period. We recorded a cumulative adjustment to opening retained earnings on January 1, 2018 for the difference between fair value and cost for these fund investments. The estimated fair value and carrying value of these venture capital and private equity fund investments was
$201.1 million
as of
December 31, 2018
. As of December 31, 2017, these investments were carried at cost and had a carrying value of
$98.5 million
.
|
(3)
|
Effective January 1, 2018, we adopted ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which eliminated the concept of cost method accounting. On a prospective basis, we will report our other investments in the line item "Other investments without a readily determinable fair value." These investments include direct equity investments in private companies. The carrying value is based on the price at which the investment was acquired plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments. We consider a range of factors when adjusting the fair value of these investments, including, but not limited to, the term and nature of the investment, local market conditions, values for comparable securities, current and projected operating performance, exit strategies, financing transactions subsequent to the acquisition of the investment and a discount for certain investments that have lock-up restrictions or other features that indicate a discount to fair value is warranted. For further details on the carrying value of these investments refer to
Note 8—“Investment Securities" of the “Notes to the Consolidated Financial Statements” under Part II, Item 8 of this report
.
|
(4)
|
Investments classified as other equity securities (fair value accounting) represent shares held in public companies as a result of exercising public equity warrant assets and direct equity investments in public companies held by our consolidated funds. Effective January 1, 2018 we adopted ASU 2016-01 Recognition and Measurement of Financial Assets and Financial Liabilities, which requires equity securities to be measured at fair value with changes in the fair value recognized through net income. Prior to January 1, 2018, we reported equity securities in public companies that we held as a result of exercising public equity warrant assets in available-for-sale securities. On a prospective basis, these equity securities will be reported in non-marketable and other equity securities.
|
(5)
|
The following table shows the carrying value and our ownership percentage of each investment at
December 31, 2018
and
2017
(equity method accounting):
|
|
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||||||||||||||
(Dollars in thousands)
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG
|
|
Carrying value
(as reported)
|
|
Amount attributable
to SVBFG
|
||||||||||||
Venture capital and private equity fund investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Strategic Investors Fund II, LP
|
|
$
|
4,670
|
|
|
$
|
4,366
|
|
|
$
|
6,342
|
|
|
$
|
5,971
|
|
|
$
|
7,720
|
|
|
$
|
7,366
|
|
Strategic Investors Fund III, LP
|
|
17,396
|
|
|
14,059
|
|
|
18,758
|
|
|
15,211
|
|
|
20,449
|
|
|
17,036
|
|
||||||
Strategic Investors Fund IV, LP
|
|
28,974
|
|
|
24,388
|
|
|
25,551
|
|
|
21,739
|
|
|
24,530
|
|
|
21,504
|
|
||||||
Strategic Investors Fund V funds
|
|
28,189
|
|
|
14,799
|
|
|
16,856
|
|
|
8,849
|
|
|
12,029
|
|
|
6,326
|
|
||||||
CP II, LP (i)
|
|
7,122
|
|
|
4,308
|
|
|
6,700
|
|
|
4,056
|
|
|
7,798
|
|
|
4,871
|
|
||||||
Other venture capital and private equity fund investments
|
|
43,134
|
|
|
21,001
|
|
|
15,602
|
|
|
8,849
|
|
|
10,297
|
|
|
6,927
|
|
||||||
Total venture capital and private equity fund investments
|
|
$
|
129,485
|
|
|
$
|
82,921
|
|
|
$
|
89,809
|
|
|
$
|
64,675
|
|
|
$
|
82,823
|
|
|
$
|
64,030
|
|
Debt funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gold Hill Capital 2008, LP (ii)
|
|
$
|
3,901
|
|
|
$
|
3,901
|
|
|
$
|
18,690
|
|
|
$
|
18,690
|
|
|
$
|
13,557
|
|
|
$
|
13,557
|
|
Other debt funds
|
|
1,925
|
|
|
1,925
|
|
|
2,493
|
|
|
2,493
|
|
|
3,463
|
|
|
3,463
|
|
||||||
Total debt funds
|
|
$
|
5,826
|
|
|
$
|
5,826
|
|
|
$
|
21,183
|
|
|
$
|
21,183
|
|
|
$
|
17,020
|
|
|
$
|
17,020
|
|
Other investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
SPD Silicon Valley Bank Co., Ltd.
|
|
$
|
76,412
|
|
|
$
|
76,412
|
|
|
$
|
75,337
|
|
|
$
|
75,337
|
|
|
$
|
75,296
|
|
|
$
|
75,296
|
|
Other investments
|
|
45,309
|
|
|
45,309
|
|
|
35,861
|
|
|
35,861
|
|
|
48,218
|
|
|
48,218
|
|
||||||
Total other investments
|
|
$
|
121,721
|
|
|
$
|
121,721
|
|
|
$
|
111,198
|
|
|
$
|
111,198
|
|
|
$
|
123,514
|
|
|
$
|
123,514
|
|
|
(i)
|
Our ownership includes direct ownership interest of
1.3 percent
and indirect ownership interest of
3.8 percent
through our investments in Strategic Investors Fund II, LP.
|
(ii)
|
Our ownership includes direct ownership interest of
11.5 percent
in the fund and an indirect interest in the fund through our investment in Gold Hill Capital 2008, LLC of
4.0 percent
.
|
|
|
December 31,
|
||||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Software/internet (1)
|
|
$
|
6,154,755
|
|
|
$
|
6,172,531
|
|
|
$
|
5,627,031
|
|
|
$
|
5,437,915
|
|
|
$
|
4,954,676
|
|
Hardware (1)
|
|
1,234,557
|
|
|
1,193,599
|
|
|
1,180,398
|
|
|
1,071,528
|
|
|
1,131,006
|
|
|||||
Private equity/venture capital
|
|
14,110,560
|
|
|
9,952,377
|
|
|
7,691,148
|
|
|
5,467,577
|
|
|
4,582,906
|
|
|||||
Life science/healthcare (1)
|
|
2,385,612
|
|
|
1,808,827
|
|
|
1,853,004
|
|
|
1,710,642
|
|
|
1,289,904
|
|
|||||
Premium wine
|
|
249,266
|
|
|
204,105
|
|
|
200,156
|
|
|
201,175
|
|
|
187,568
|
|
|||||
Other (1)
|
|
321,978
|
|
|
365,724
|
|
|
393,551
|
|
|
312,278
|
|
|
234,551
|
|
|||||
Total commercial loans
|
|
24,456,728
|
|
|
19,697,163
|
|
|
16,945,288
|
|
|
14,201,115
|
|
|
12,380,611
|
|
|||||
Real estate secured loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Premium wine (2)
|
|
710,397
|
|
|
669,053
|
|
|
678,166
|
|
|
646,120
|
|
|
606,753
|
|
|||||
Consumer loans (3)
|
|
2,612,971
|
|
|
2,300,506
|
|
|
1,926,968
|
|
|
1,544,440
|
|
|
1,118,115
|
|
|||||
Other
|
|
40,435
|
|
|
42,068
|
|
|
43,487
|
|
|
44,830
|
|
|
39,651
|
|
|||||
Total real estate secured loans
|
|
3,363,803
|
|
|
3,011,627
|
|
|
2,648,621
|
|
|
2,235,390
|
|
|
1,764,519
|
|
|||||
Construction loans (4)
|
|
97,077
|
|
|
68,546
|
|
|
64,671
|
|
|
78,682
|
|
|
78,626
|
|
|||||
Consumer loans
|
|
420,672
|
|
|
328,980
|
|
|
241,364
|
|
|
226,883
|
|
|
160,520
|
|
|||||
Total loans, net of unearned income (5)(6)
|
|
$
|
28,338,280
|
|
|
$
|
23,106,316
|
|
|
$
|
19,899,944
|
|
|
$
|
16,742,070
|
|
|
$
|
14,384,276
|
|
|
(1)
|
Due to the diverse nature of energy and resource innovation products and services, for our loan-related reporting purposes, ERI-related loans are reported under our software/internet, hardware, life science/healthcare and other commercial loan categories, as applicable.
|
(2)
|
Included in our premium wine portfolio are gross construction loans of
$99 million
,
$100 million
,
$110 million
, $121 million and $112 million at
December 31, 2018
,
2017
,
2016
,
2015
and
2014
, respectively.
|
(3)
|
Consumer loans secured by real estate at
December 31, 2018
,
2017
,
2016
,
2015
and
2014
were comprised of the following:
|
|
|
December 31,
|
||||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Loans for personal residence
|
|
$
|
2,251,292
|
|
|
$
|
1,995,840
|
|
|
$
|
1,655,349
|
|
|
$
|
1,312,818
|
|
|
$
|
918,629
|
|
Loans to eligible employees
|
|
290,194
|
|
|
243,118
|
|
|
199,291
|
|
|
156,001
|
|
|
133,568
|
|
|||||
Home equity lines of credit
|
|
71,485
|
|
|
61,548
|
|
|
72,328
|
|
|
75,621
|
|
|
65,918
|
|
|||||
Consumer loans secured by real estate
|
|
$
|
2,612,971
|
|
|
$
|
2,300,506
|
|
|
$
|
1,926,968
|
|
|
$
|
1,544,440
|
|
|
$
|
1,118,115
|
|
(4)
|
Construction loans consist of qualified affordable housing project loans made to fulfill our responsibilities under the Community Reinvestment Act and are primarily secured by real estate.
|
(5)
|
Unearned income, net of deferred costs, was
$173 million
,
$148 million
,
$125 million
, $115 million and $104 million in
2018
,
2017
,
2016
,
2015
and
2014
, respectively.
|
(6)
|
Included within our total loan portfolio are credit card loans of
$335 million
,
$270 million
,
$224 million
, $177 million, and$131 million at
December 31, 2018
,
2017
,
2016
,
2015
and
2014
, respectively, and primarily represent corporate credit cards.
|
|
|
December 31,
|
||||||||||||
|
|
2018
|
|
2017
|
||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Percentage
|
|
Amount
|
|
Percentage
|
||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
||||||
Software/internet
|
|
$
|
6,209,978
|
|
|
21.8
|
%
|
|
$
|
6,232,725
|
|
|
26.8
|
%
|
Hardware
|
|
1,245,800
|
|
|
4.4
|
|
|
1,200,900
|
|
|
5.2
|
|
||
Private equity/venture capital
|
|
14,118,132
|
|
|
49.5
|
|
|
9,961,121
|
|
|
42.8
|
|
||
Life science/healthcare
|
|
2,461,076
|
|
|
8.6
|
|
|
1,867,960
|
|
|
8.0
|
|
||
Premium wine
|
|
249,316
|
|
|
0.9
|
|
|
204,257
|
|
|
0.9
|
|
||
Other
|
|
346,747
|
|
|
1.2
|
|
|
379,431
|
|
|
1.6
|
|
||
Commercial loans
|
|
24,631,049
|
|
|
86.4
|
|
|
19,846,394
|
|
|
85.3
|
|
||
Real estate secured loans:
|
|
|
|
|
|
|
|
|
||||||
Premium wine
|
|
711,237
|
|
|
2.5
|
|
|
670,112
|
|
|
2.9
|
|
||
Consumer loans
|
|
2,609,645
|
|
|
9.2
|
|
|
2,297,857
|
|
|
9.9
|
|
||
Other
|
|
40,627
|
|
|
0.1
|
|
|
42,230
|
|
|
0.2
|
|
||
Real estate secured loans
|
|
3,361,509
|
|
|
11.8
|
|
|
3,010,199
|
|
|
13.0
|
|
||
Construction loans
|
|
98,034
|
|
|
0.3
|
|
|
69,108
|
|
|
0.3
|
|
||
Consumer loans
|
|
420,720
|
|
|
1.5
|
|
|
328,452
|
|
|
1.4
|
|
||
Total gross loans
|
|
$
|
28,511,312
|
|
|
100.0
|
%
|
|
$
|
23,254,153
|
|
|
100.0
|
%
|
|
|
December 31, 2018
|
||||||||||||||||||||||
(Dollars in thousands)
|
|
Less than
Five Million
|
|
Five to Ten
Million
|
|
Ten to Twenty
Million
|
|
Twenty to Thirty Million
|
|
Thirty Million
or More
|
|
Total
|
||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
1,515,096
|
|
|
$
|
918,647
|
|
|
$
|
1,520,634
|
|
|
$
|
1,221,250
|
|
|
$
|
1,034,351
|
|
|
$
|
6,209,978
|
|
Hardware
|
|
292,022
|
|
|
152,061
|
|
|
196,763
|
|
|
386,288
|
|
|
218,666
|
|
|
1,245,800
|
|
||||||
Private equity/venture capital
|
|
836,894
|
|
|
1,012,605
|
|
|
2,120,918
|
|
|
2,135,279
|
|
|
8,012,436
|
|
|
14,118,132
|
|
||||||
Life science/healthcare
|
|
273,075
|
|
|
477,046
|
|
|
645,895
|
|
|
410,127
|
|
|
654,933
|
|
|
2,461,076
|
|
||||||
Premium wine
|
|
70,573
|
|
|
55,852
|
|
|
48,656
|
|
|
65,035
|
|
|
9,200
|
|
|
249,316
|
|
||||||
Other
|
|
246,011
|
|
|
18,921
|
|
|
10,911
|
|
|
70,904
|
|
|
—
|
|
|
346,747
|
|
||||||
Commercial loans
|
|
3,233,671
|
|
|
2,635,132
|
|
|
4,543,777
|
|
|
4,288,883
|
|
|
9,929,586
|
|
|
24,631,049
|
|
||||||
Real estate secured loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Premium wine
|
|
168,130
|
|
|
173,882
|
|
|
263,093
|
|
|
83,945
|
|
|
22,187
|
|
|
711,237
|
|
||||||
Consumer loans
|
|
2,258,479
|
|
|
239,400
|
|
|
111,766
|
|
|
—
|
|
|
—
|
|
|
2,609,645
|
|
||||||
Other
|
|
7,506
|
|
|
—
|
|
|
33,121
|
|
|
—
|
|
|
—
|
|
|
40,627
|
|
||||||
Real estate secured loans
|
|
2,434,115
|
|
|
413,282
|
|
|
407,980
|
|
|
83,945
|
|
|
22,187
|
|
|
3,361,509
|
|
||||||
Construction loans
|
|
7,076
|
|
|
15,064
|
|
|
75,894
|
|
|
—
|
|
|
—
|
|
|
98,034
|
|
||||||
Consumer loans
|
|
148,391
|
|
|
55,401
|
|
|
51,409
|
|
|
93,690
|
|
|
71,829
|
|
|
420,720
|
|
||||||
Total gross loans
|
|
$
|
5,823,253
|
|
|
$
|
3,118,879
|
|
|
$
|
5,079,060
|
|
|
$
|
4,466,518
|
|
|
$
|
10,023,602
|
|
|
$
|
28,511,312
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
(Dollars in thousands)
|
|
Less than
Five Million
|
|
Five to Ten
Million
|
|
Ten to Twenty
Million
|
|
Twenty to Thirty Million
|
|
Thirty Million
or More
|
|
Total
|
||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
1,558,717
|
|
|
$
|
974,959
|
|
|
$
|
1,545,194
|
|
|
$
|
1,190,247
|
|
|
$
|
963,608
|
|
|
$
|
6,232,725
|
|
Hardware
|
|
258,586
|
|
|
138,254
|
|
|
253,978
|
|
|
217,425
|
|
|
332,657
|
|
|
1,200,900
|
|
||||||
Private equity/venture capital
|
|
697,427
|
|
|
807,596
|
|
|
1,617,121
|
|
|
1,142,818
|
|
|
5,696,159
|
|
|
9,961,121
|
|
||||||
Life science/healthcare
|
|
321,738
|
|
|
450,445
|
|
|
576,926
|
|
|
313,656
|
|
|
205,195
|
|
|
1,867,960
|
|
||||||
Premium wine
|
|
60,663
|
|
|
37,845
|
|
|
64,062
|
|
|
32,423
|
|
|
9,264
|
|
|
204,257
|
|
||||||
Other
|
|
149,825
|
|
|
23,096
|
|
|
103,989
|
|
|
25,599
|
|
|
76,922
|
|
|
379,431
|
|
||||||
Commercial loans
|
|
3,046,956
|
|
|
2,432,195
|
|
|
4,161,270
|
|
|
2,922,168
|
|
|
7,283,805
|
|
|
19,846,394
|
|
||||||
Real estate secured loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Premium wine
|
|
150,563
|
|
|
187,272
|
|
|
220,062
|
|
|
89,561
|
|
|
22,654
|
|
|
670,112
|
|
||||||
Consumer loans
|
|
1,989,973
|
|
|
224,825
|
|
|
83,059
|
|
|
—
|
|
|
—
|
|
|
2,297,857
|
|
||||||
Other
|
|
7,763
|
|
|
—
|
|
|
14,134
|
|
|
20,333
|
|
|
—
|
|
|
42,230
|
|
||||||
Real estate secured loans
|
|
2,148,299
|
|
|
412,097
|
|
|
317,255
|
|
|
109,894
|
|
|
22,654
|
|
|
3,010,199
|
|
||||||
Construction loans
|
|
12,178
|
|
|
34,029
|
|
|
—
|
|
|
22,901
|
|
|
—
|
|
|
69,108
|
|
||||||
Consumer loans
|
|
146,395
|
|
|
49,921
|
|
|
17,120
|
|
|
78,742
|
|
|
36,274
|
|
|
328,452
|
|
||||||
Total gross loans
|
|
$
|
5,353,828
|
|
|
$
|
2,928,242
|
|
|
$
|
4,495,645
|
|
|
$
|
3,133,705
|
|
|
$
|
7,342,733
|
|
|
$
|
23,254,153
|
|
|
|
Remaining Contractual Maturity of Gross Loans
|
||||||||||||||
(Dollars in thousands)
|
|
One Year or Less
|
|
After One Year and Through Five Years
|
|
After Five Years
|
|
Total
|
||||||||
Fixed-rate loans:
|
|
|
|
|
|
|
|
|
||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
||||||||
Software/internet
|
|
$
|
288,771
|
|
|
$
|
262,689
|
|
|
$
|
11,879
|
|
|
$
|
563,339
|
|
Hardware
|
|
61,464
|
|
|
44,566
|
|
|
—
|
|
|
106,030
|
|
||||
Private equity/venture capital
|
|
11,737
|
|
|
7,905
|
|
|
10,913
|
|
|
30,555
|
|
||||
Life science/healthcare
|
|
42,704
|
|
|
57,274
|
|
|
—
|
|
|
99,978
|
|
||||
Premium wine
|
|
2,872
|
|
|
9,569
|
|
|
5,597
|
|
|
18,038
|
|
||||
Other
|
|
260,241
|
|
|
—
|
|
|
—
|
|
|
260,241
|
|
||||
Total commercial loans
|
|
667,789
|
|
|
382,003
|
|
|
28,389
|
|
|
1,078,181
|
|
||||
Real estate secured loans:
|
|
|
|
|
|
|
|
|
||||||||
Premium wine
|
|
33,529
|
|
|
217,657
|
|
|
355,845
|
|
|
607,031
|
|
||||
Consumer loans
|
|
—
|
|
|
7,925
|
|
|
266,559
|
|
|
274,484
|
|
||||
Other
|
|
—
|
|
|
22,426
|
|
|
18,201
|
|
|
40,627
|
|
||||
Total real estate secured loans
|
|
33,529
|
|
|
248,008
|
|
|
640,605
|
|
|
922,142
|
|
||||
Construction loans
|
|
63,072
|
|
|
28,274
|
|
|
6,690
|
|
|
98,036
|
|
||||
Consumer loans
|
|
698
|
|
|
4,738
|
|
|
—
|
|
|
5,436
|
|
||||
Total fixed-rate loans
|
|
$
|
765,088
|
|
|
$
|
663,023
|
|
|
$
|
675,684
|
|
|
$
|
2,103,795
|
|
|
|
|
|
|
|
|
|
|
||||||||
Variable-rate loans:
|
|
|
|
|
|
|
|
|
||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
||||||||
Software/internet
|
|
$
|
1,412,873
|
|
|
$
|
4,153,715
|
|
|
$
|
80,051
|
|
|
$
|
5,646,639
|
|
Hardware
|
|
227,272
|
|
|
782,272
|
|
|
130,226
|
|
|
1,139,770
|
|
||||
Private equity/venture capital
|
|
13,389,154
|
|
|
641,903
|
|
|
56,520
|
|
|
14,087,577
|
|
||||
Life science/healthcare
|
|
110,377
|
|
|
2,203,925
|
|
|
46,796
|
|
|
2,361,098
|
|
||||
Premium wine
|
|
171,865
|
|
|
58,325
|
|
|
1,089
|
|
|
231,279
|
|
||||
Other
|
|
25,168
|
|
|
61,336
|
|
|
—
|
|
|
86,504
|
|
||||
Total commercial loans
|
|
15,336,709
|
|
|
7,901,476
|
|
|
314,682
|
|
|
23,552,867
|
|
||||
Real estate secured loans:
|
|
|
|
|
|
|
|
|
||||||||
Premium wine
|
|
9,034
|
|
|
46,428
|
|
|
48,743
|
|
|
104,205
|
|
||||
Consumer loans
|
|
1,300
|
|
|
8,582
|
|
|
2,325,279
|
|
|
2,335,161
|
|
||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total real estate secured loans
|
|
10,334
|
|
|
55,010
|
|
|
2,374,022
|
|
|
2,439,366
|
|
||||
Construction loans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Consumer loans
|
|
138,492
|
|
|
171,213
|
|
|
105,579
|
|
|
415,284
|
|
||||
Total variable-rate loans
|
|
15,485,535
|
|
|
8,127,699
|
|
|
2,794,283
|
|
|
26,407,517
|
|
||||
Total gross loans
|
|
$
|
16,250,623
|
|
|
$
|
8,790,722
|
|
|
$
|
3,469,967
|
|
|
$
|
28,511,312
|
|
|
|
Year ended December 31,
|
||||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Allowance for loan losses, beginning balance
|
|
$
|
255,024
|
|
|
$
|
225,366
|
|
|
$
|
217,613
|
|
|
$
|
165,359
|
|
|
$
|
142,886
|
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Software/internet
|
|
(42,315
|
)
|
|
(45,012
|
)
|
|
(68,784
|
)
|
|
(33,246
|
)
|
|
(21,031
|
)
|
|||||
Hardware
|
|
(16,148
|
)
|
|
(10,414
|
)
|
|
(13,233
|
)
|
|
(5,145
|
)
|
|
(15,265
|
)
|
|||||
Venture capital/private equity
|
|
(112
|
)
|
|
(323
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Life science/healthcare
|
|
(6,662
|
)
|
|
(8,210
|
)
|
|
(9,693
|
)
|
|
(7,291
|
)
|
|
(2,951
|
)
|
|||||
Premium wine
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|||||
Other
|
|
(2,391
|
)
|
|
(1,156
|
)
|
|
(5,045
|
)
|
|
(4,990
|
)
|
|
(3,886
|
)
|
|||||
Total commercial loans
|
|
(67,628
|
)
|
|
(65,115
|
)
|
|
(96,755
|
)
|
|
(50,672
|
)
|
|
(43,168
|
)
|
|||||
Consumer loans
|
|
(289
|
)
|
|
(1,567
|
)
|
|
(102
|
)
|
|
(296
|
)
|
|
—
|
|
|||||
Total charge-offs
|
|
(67,917
|
)
|
|
(66,682
|
)
|
|
(96,857
|
)
|
|
(50,968
|
)
|
|
(43,168
|
)
|
|||||
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Software/internet
|
|
5,664
|
|
|
4,649
|
|
|
7,278
|
|
|
1,621
|
|
|
1,425
|
|
|||||
Hardware
|
|
1,849
|
|
|
487
|
|
|
1,667
|
|
|
3,332
|
|
|
2,238
|
|
|||||
Venture capital/private equity
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Life science/healthcare
|
|
348
|
|
|
189
|
|
|
1,129
|
|
|
277
|
|
|
374
|
|
|||||
Premium wine
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
240
|
|
|||||
Other
|
|
3,275
|
|
|
1,850
|
|
|
1,880
|
|
|
809
|
|
|
1,748
|
|
|||||
Total commercial loans
|
|
11,149
|
|
|
7,175
|
|
|
11,954
|
|
|
6,046
|
|
|
6,025
|
|
|||||
Consumer loans
|
|
487
|
|
|
1,363
|
|
|
258
|
|
|
163
|
|
|
379
|
|
|||||
Total recoveries
|
|
11,636
|
|
|
8,538
|
|
|
12,212
|
|
|
6,209
|
|
|
6,404
|
|
|||||
Provision for loan losses
|
|
84,292
|
|
|
85,939
|
|
|
95,697
|
|
|
97,629
|
|
|
59,486
|
|
|||||
Foreign currency translation adjustments
|
|
(2,132
|
)
|
|
1,863
|
|
|
(3,299
|
)
|
|
(616
|
)
|
|
(249
|
)
|
|||||
Allowance for loan losses, ending balance
|
|
$
|
280,903
|
|
|
$
|
255,024
|
|
|
$
|
225,366
|
|
|
$
|
217,613
|
|
|
$
|
165,359
|
|
|
|
December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
|
ALLL Amount
|
|
Percent of Total Loans (1)
|
|
ALLL Amount
|
|
Percent of Total Loans (1)
|
|
ALLL Amount
|
|
Percent of Total Loans (1)
|
|
ALLL Amount
|
|
Percent of Total Loans (1)
|
|
ALLL Amount
|
|
Percent of Total Loans (1)
|
|||||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Software/internet
|
|
$
|
103,567
|
|
|
21.8
|
%
|
|
$
|
96,104
|
|
|
26.8
|
%
|
|
$
|
97,388
|
|
|
28.3
|
%
|
|
$
|
103,045
|
|
|
32.5
|
%
|
|
$
|
80,981
|
|
|
34.5
|
%
|
Hardware
|
|
19,725
|
|
|
4.4
|
|
|
27,614
|
|
|
5.2
|
|
|
31,166
|
|
|
5.9
|
|
|
23,085
|
|
|
6.4
|
|
|
25,860
|
|
|
7.9
|
|
|||||
Private equity/venture capital
|
|
98,581
|
|
|
49.5
|
|
|
82,468
|
|
|
42.8
|
|
|
50,299
|
|
|
38.7
|
|
|
35,282
|
|
|
32.7
|
|
|
27,997
|
|
|
31.9
|
|
|||||
Life science/healthcare
|
|
32,180
|
|
|
8.6
|
|
|
24,924
|
|
|
8.0
|
|
|
25,446
|
|
|
9.3
|
|
|
36,576
|
|
|
10.2
|
|
|
15,208
|
|
|
9.0
|
|
|||||
Premium wine
|
|
3,355
|
|
|
3.4
|
|
|
3,532
|
|
|
3.8
|
|
|
4,115
|
|
|
4.5
|
|
|
5,205
|
|
|
5.1
|
|
|
4,473
|
|
|
5.5
|
|
|||||
Other
|
|
3,558
|
|
|
1.7
|
|
|
3,941
|
|
|
2.1
|
|
|
4,768
|
|
|
2.5
|
|
|
4,252
|
|
|
2.6
|
|
|
3,253
|
|
|
2.4
|
|
|||||
Total commercial loans
|
|
260,966
|
|
|
89.4
|
|
|
238,583
|
|
|
88.7
|
|
|
213,182
|
|
|
89.2
|
|
|
207,445
|
|
|
89.5
|
|
|
157,772
|
|
|
91.2
|
|
|||||
Consumer loans
|
|
19,937
|
|
|
10.6
|
|
|
16,441
|
|
|
11.3
|
|
|
12,184
|
|
|
10.8
|
|
|
10,168
|
|
|
10.5
|
|
|
7,587
|
|
|
8.8
|
|
|||||
Total
|
|
$
|
280,903
|
|
|
100.0
|
%
|
|
$
|
255,024
|
|
|
100.0
|
%
|
|
$
|
225,366
|
|
|
100.0
|
%
|
|
$
|
217,613
|
|
|
100.0
|
%
|
|
$
|
165,359
|
|
|
100.0
|
%
|
|
(1)
|
Represents loan balances as a percentage of total gross loans at each respective year-end.
|
|
|
December 31,
|
||||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Gross nonperforming, past due, and restructured loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Nonaccrual loans
|
|
$
|
94,142
|
|
|
$
|
119,259
|
|
|
$
|
118,979
|
|
|
$
|
123,392
|
|
|
$
|
38,137
|
|
Loans past due 90 days or more still accruing interest
|
|
1,964
|
|
|
191
|
|
|
33
|
|
|
—
|
|
|
1,302
|
|
|||||
Total nonperforming loans
|
|
96,106
|
|
|
119,450
|
|
|
119,012
|
|
|
123,392
|
|
|
39,439
|
|
|||||
OREO and other foreclosed assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
561
|
|
|||||
Total nonperforming assets
|
|
$
|
96,106
|
|
|
$
|
119,450
|
|
|
$
|
119,012
|
|
|
$
|
123,392
|
|
|
$
|
40,000
|
|
Performing TDRs
|
|
$
|
31,639
|
|
|
$
|
71,468
|
|
|
$
|
33,732
|
|
|
$
|
10,635
|
|
|
$
|
587
|
|
Nonperforming loans as a percentage of total gross loans
|
|
0.34
|
%
|
|
0.51
|
%
|
|
0.59
|
%
|
|
0.73
|
%
|
|
0.27
|
%
|
|||||
Nonperforming assets as a percentage of total assets
|
|
0.17
|
|
|
0.23
|
|
|
0.27
|
|
|
0.28
|
|
|
0.10
|
|
|||||
Allowance for loan losses
|
|
$
|
280,903
|
|
|
$
|
255,024
|
|
|
$
|
225,366
|
|
|
$
|
217,613
|
|
|
$
|
165,359
|
|
As a percentage of total gross loans
|
|
0.99
|
%
|
|
1.10
|
%
|
|
1.13
|
%
|
|
1.29
|
%
|
|
1.14
|
%
|
|||||
As a percentage of total gross nonperforming loans
|
|
292.28
|
|
|
213.50
|
|
|
189.36
|
|
|
176.36
|
|
|
419.28
|
|
|||||
Allowance for loan losses for nonaccrual loans
|
|
$
|
37,941
|
|
|
$
|
41,793
|
|
|
$
|
37,277
|
|
|
$
|
51,844
|
|
|
$
|
15,051
|
|
As a percentage of total gross loans
|
|
0.13
|
%
|
|
0.18
|
%
|
|
0.19
|
%
|
|
0.31
|
%
|
|
0.10
|
%
|
|||||
As a percentage of total gross nonperforming loans
|
|
39.48
|
|
|
34.99
|
|
|
31.32
|
|
|
42.02
|
|
|
38.16
|
|
|||||
Allowance for loan losses for total gross performing loans
|
|
$
|
242,962
|
|
|
$
|
213,231
|
|
|
$
|
188,089
|
|
|
$
|
165,769
|
|
|
$
|
150,308
|
|
As a percentage of total gross loans
|
|
0.85
|
%
|
|
0.92
|
%
|
|
0.94
|
%
|
|
0.98
|
%
|
|
1.04
|
%
|
|||||
As a percentage of total gross performing loans
|
|
0.86
|
|
|
0.92
|
|
|
0.94
|
|
|
0.99
|
|
|
1.04
|
|
|||||
Total gross loans
|
|
$
|
28,511,312
|
|
|
$
|
23,254,153
|
|
|
$
|
20,024,662
|
|
|
$
|
16,857,131
|
|
|
$
|
14,488,766
|
|
Total gross performing loans
|
|
28,415,206
|
|
|
23,134,703
|
|
|
19,905,650
|
|
|
16,733,739
|
|
|
14,449,327
|
|
|||||
Allowance for unfunded credit commitments (1)
|
|
55,183
|
|
|
51,770
|
|
|
45,265
|
|
|
34,415
|
|
|
36,419
|
|
|||||
As a percentage of total unfunded credit commitments
|
|
0.29
|
%
|
|
0.30
|
%
|
|
0.27
|
%
|
|
0.22
|
%
|
|
0.25
|
%
|
|||||
Total unfunded credit commitments (2)
|
|
$
|
18,913,021
|
|
|
$
|
17,462,537
|
|
|
$
|
16,743,196
|
|
|
$
|
15,614,359
|
|
|
$
|
14,705,785
|
|
|
(1)
|
The “allowance for unfunded credit commitments” is included as a component of other liabilities and any provision is included in the "Provision for credit losses" in the statement of income. See “Provision for Credit Losses” for a discussion of the changes to the allowance.
|
(2)
|
Includes unfunded loan commitments and letters of credit.
|
|
|
December 31,
|
||||||||||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Software/internet
|
|
$
|
66,781
|
|
|
$
|
78,860
|
|
|
$
|
76,605
|
|
|
$
|
77,545
|
|
|
$
|
33,287
|
|
Hardware
|
|
1,256
|
|
|
16,185
|
|
|
6,581
|
|
|
430
|
|
|
2,521
|
|
|||||
Private equity/venture capital
|
|
3,700
|
|
|
658
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Life science/healthcare
|
|
17,791
|
|
|
20,520
|
|
|
31,783
|
|
|
44,107
|
|
|
475
|
|
|||||
Premium wine
|
|
284
|
|
|
401
|
|
|
491
|
|
|
1,167
|
|
|
1,304
|
|
|||||
Other
|
|
411
|
|
|
32
|
|
|
403
|
|
|
—
|
|
|
233
|
|
|||||
Total commercial loans
|
|
90,223
|
|
|
116,656
|
|
|
115,863
|
|
|
123,249
|
|
|
37,820
|
|
|||||
Consumer loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate secured loans
|
|
3,919
|
|
|
2,181
|
|
|
1,504
|
|
|
143
|
|
|
192
|
|
|||||
Other consumer loans
|
|
—
|
|
|
422
|
|
|
1,612
|
|
|
—
|
|
|
125
|
|
|||||
Total consumer loans
|
|
3,919
|
|
|
2,603
|
|
|
3,116
|
|
|
143
|
|
|
317
|
|
|||||
Total nonaccrual loans
|
|
$
|
94,142
|
|
|
$
|
119,259
|
|
|
$
|
118,979
|
|
|
$
|
123,392
|
|
|
$
|
38,137
|
|
|
|
Year ended December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Balance, beginning of period
|
|
$
|
119,259
|
|
|
$
|
118,979
|
|
Additions
|
|
85,499
|
|
|
102,183
|
|
||
Paydowns
|
|
(66,660
|
)
|
|
(46,825
|
)
|
||
Charge-offs
|
|
(43,857
|
)
|
|
(55,076
|
)
|
||
Other reductions
|
|
(99
|
)
|
|
(2
|
)
|
||
Balance, end of period
|
|
$
|
94,142
|
|
|
$
|
119,259
|
|
|
|
December 31,
|
|||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change
|
|||||
Derivative assets (1)
|
|
$
|
258,139
|
|
|
$
|
232,152
|
|
|
11.2
|
%
|
Foreign exchange spot contract assets, gross
|
|
152,268
|
|
|
208,738
|
|
|
(27.1
|
)
|
||
Accrued interest receivable
|
|
197,927
|
|
|
141,773
|
|
|
39.6
|
|
||
Net deferred tax assets
|
|
65,433
|
|
|
63,845
|
|
|
2.5
|
|
||
FHLB and Federal Reserve Bank stock
|
|
58,878
|
|
|
60,020
|
|
|
(1.9
|
)
|
||
Accounts receivable
|
|
55,807
|
|
|
55,946
|
|
|
(0.2
|
)
|
||
Other assets
|
|
162,809
|
|
|
113,772
|
|
|
43.1
|
|
||
Total accrued interest receivable and other assets
|
|
$
|
951,261
|
|
|
$
|
876,246
|
|
|
8.6
|
|
|
(1)
|
See “Derivatives” section below.
|
|
|
December 31,
|
|||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change
|
|||||
Assets:
|
|
|
|
|
|
|
|||||
Equity warrant assets
|
|
$
|
149,238
|
|
|
$
|
123,763
|
|
|
20.6
|
%
|
Foreign exchange forward and option contracts
|
|
100,402
|
|
|
96,636
|
|
|
3.9
|
|
||
Client interest rate derivatives
|
|
8,499
|
|
|
11,753
|
|
|
(27.7
|
)
|
||
Total derivatives assets
|
|
$
|
258,139
|
|
|
$
|
232,152
|
|
|
11.2
|
|
Liabilities:
|
|
|
|
|
|
|
|||||
Foreign exchange forward and option contracts
|
|
$
|
88,559
|
|
|
$
|
96,641
|
|
|
(8.4
|
)
|
Client interest rate derivatives
|
|
9,491
|
|
|
11,940
|
|
|
(20.5
|
)
|
||
Total derivatives liabilities
|
|
$
|
98,050
|
|
|
$
|
108,581
|
|
|
(9.7
|
)
|
|
|
Year ended December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Balance, beginning of period
|
|
$
|
123,763
|
|
|
$
|
131,123
|
|
New equity warrant assets
|
|
18,021
|
|
|
15,201
|
|
||
Non-cash increases in fair value
|
|
36,920
|
|
|
10,702
|
|
||
Exercised equity warrant assets
|
|
(23,502
|
)
|
|
(28,841
|
)
|
||
Terminated equity warrant assets
|
|
(5,964
|
)
|
|
(4,422
|
)
|
||
Balance, end of period
|
|
$
|
149,238
|
|
|
$
|
123,763
|
|
|
|
December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Noninterest-bearing demand
|
|
$
|
39,103,422
|
|
|
$
|
36,655,497
|
|
|
$
|
31,975,457
|
|
Interest bearing checking and savings accounts
|
|
648,468
|
|
|
556,121
|
|
|
375,710
|
|
|||
Money market
|
|
7,498,205
|
|
|
5,975,220
|
|
|
5,331,054
|
|
|||
Money market deposits in foreign offices
|
|
152,781
|
|
|
111,201
|
|
|
107,657
|
|
|||
Sweep deposits in foreign offices
|
|
1,875,298
|
|
|
908,890
|
|
|
1,133,872
|
|
|||
Time
|
|
50,726
|
|
|
47,146
|
|
|
56,118
|
|
|||
Total deposits
|
|
$
|
49,328,900
|
|
|
$
|
44,254,075
|
|
|
$
|
38,979,868
|
|
|
|
December 31, 2018
|
||||||||||||||||||
(Dollars in thousands)
|
|
Three months
or less
|
|
More than
three months
to six months
|
|
More than six
months to
twelve months
|
|
More than
twelve months
|
|
Total
|
||||||||||
Time deposits, $100,000 and over
|
|
$
|
28,338
|
|
|
$
|
2,158
|
|
|
$
|
15,500
|
|
|
$
|
—
|
|
|
$
|
45,996
|
|
Other time deposits
|
|
2,861
|
|
|
639
|
|
|
1,230
|
|
|
—
|
|
|
4,730
|
|
|||||
Total time deposits
|
|
$
|
31,199
|
|
|
$
|
2,797
|
|
|
$
|
16,730
|
|
|
$
|
—
|
|
|
$
|
50,726
|
|
|
|
December 31,
|
|||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Rate
|
|
Amount
|
|
Rate
|
|
Amount
|
|
Rate
|
|||||||||
Short-term FHLB advances
|
|
$
|
300,000
|
|
|
2.54
|
%
|
|
$
|
700,000
|
|
|
1.37
|
%
|
|
$
|
500,000
|
|
|
0.59
|
%
|
Federal funds purchased
|
|
—
|
|
|
—
|
|
|
330,000
|
|
|
1.45
|
|
|
—
|
|
|
—
|
|
|||
Securities sold under agreement to repurchase
|
|
319,414
|
|
|
2.70
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Other short-term borrowings
|
|
11,998
|
|
|
2.39
|
|
|
3,730
|
|
|
1.33
|
|
|
12,668
|
|
|
0.57
|
|
|||
Total short-term borrowings
|
|
$
|
631,412
|
|
|
2.62
|
|
|
$
|
1,033,730
|
|
|
1.39
|
|
|
$
|
512,668
|
|
|
0.59
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Average daily balances:
|
|
|
|
|
|
|
||||||
Short-term FHLB advances
|
|
$
|
424,384
|
|
|
$
|
36,712
|
|
|
$
|
147,716
|
|
Federal Funds purchased (1)
|
|
44,164
|
|
|
7,529
|
|
|
5,844
|
|
|||
Securities sold under agreements to repurchase
|
|
164,938
|
|
|
—
|
|
|
63,464
|
|
|||
Other short-term borrowings (2)
|
|
10,400
|
|
|
4,264
|
|
|
3,227
|
|
|||
Total average short-term borrowings
|
|
$
|
643,886
|
|
|
$
|
48,505
|
|
|
$
|
220,251
|
|
Weighted average interest rate during the year:
|
|
|
|
|
|
|
||||||
Short-term FHLB advances
|
|
0.22
|
%
|
|
1.02
|
%
|
|
0.42
|
%
|
|||
Federal Funds purchased
|
|
8.86
|
|
|
1.36
|
|
|
0.44
|
|
|||
Securities sold under agreements to repurchase
|
|
5.76
|
|
|
—
|
|
|
0.49
|
|
|||
Other short-term borrowings
|
|
2.30
|
|
|
1.55
|
|
|
0.28
|
|
|||
Maximum month-end balances:
|
|
|
|
|
|
|
||||||
Short-term FHLB advances
|
|
$
|
2,250,000
|
|
|
$
|
700,000
|
|
|
$
|
750,000
|
|
Federal Funds purchased
|
|
490,000
|
|
|
330,000
|
|
|
150,000
|
|
|||
Securities sold under agreements to repurchase
|
|
394,592
|
|
|
—
|
|
|
304,000
|
|
|||
Other short-term borrowings
|
|
19,770
|
|
|
8,470
|
|
|
15,082
|
|
|
(1)
|
As part of our liquidity risk management practices, we periodically test availability and access to overnight borrowings in the Federal Funds market. These balances represent short-term borrowings.
|
(2)
|
Represents cash collateral received from certain counterparties in relation to market value exposures of derivative contracts in our favor.
|
|
|
Principal value at December 31, 2018
|
|
December 31,
|
||||||||||||
(Dollars in thousands)
|
|
|
2018
|
|
2017
|
|
2016
|
|||||||||
3.50% Senior Notes
|
|
$
|
350,000
|
|
|
$
|
347,639
|
|
|
$
|
347,303
|
|
|
$
|
346,979
|
|
5.375% Senior Notes
|
|
350,000
|
|
|
348,826
|
|
|
348,189
|
|
|
347,586
|
|
||||
6.05% Subordinated Notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,646
|
|
||||
7.0% Junior Subordinated Debentures
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54,493
|
|
||||
Total long-term debt
|
|
$
|
700,000
|
|
|
$
|
696,465
|
|
|
$
|
695,492
|
|
|
$
|
795,704
|
|
|
|
December 31,
|
|||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
% Change
|
|||||
Foreign exchange spot contract liabilities, gross
|
|
$
|
170,355
|
|
|
$
|
202,807
|
|
|
(16.0
|
)%
|
Accrued compensation
|
|
224,405
|
|
|
167,531
|
|
|
33.9
|
|
||
Derivative liabilities (1)
|
|
98,050
|
|
|
108,581
|
|
|
(9.7
|
)
|
||
Allowance for unfunded credit commitments
|
|
55,183
|
|
|
51,770
|
|
|
6.6
|
|
||
Other liabilities
|
|
458,366
|
|
|
381,066
|
|
|
20.3
|
|
||
Total other liabilities
|
|
$
|
1,006,359
|
|
|
$
|
911,755
|
|
|
10.4
|
|
|
(1)
|
See “Derivatives” section above.
|
|
|
December 31,
|
|
Minimum Ratios under Applicable Regulatory Capital Adequacy Requirements
|
|||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
“Well Capitalized”
|
|
“Adequately Capitalized”
|
|||||
SVB Financial:
|
|
|
|
|
|
|
|
|
|
|
|||||
CET 1 risk-based capital ratio
|
|
13.41
|
%
|
|
12.78
|
%
|
|
12.80
|
%
|
|
6.5
|
%
|
|
4.5
|
%
|
Tier 1 risk-based capital ratio
|
|
13.58
|
|
|
12.97
|
|
|
13.26
|
|
|
8.0
|
|
|
6.0
|
|
Total risk-based capital ratio
|
|
14.45
|
|
|
13.96
|
|
|
14.21
|
|
|
10.0
|
|
|
8.0
|
|
Tier 1 leverage ratio
|
|
9.06
|
|
|
8.34
|
|
|
8.34
|
|
|
N/A
|
|
|
4.0
|
|
Tangible common equity to tangible assets ratio (1)(2)
|
|
8.99
|
|
|
8.16
|
|
|
8.15
|
|
|
N/A
|
|
|
N/A
|
|
Tangible common equity to risk-weighted assets ratio (1)(2)
|
|
13.28
|
|
|
12.77
|
|
|
12.89
|
|
|
N/A
|
|
|
N/A
|
|
Bank:
|
|
|
|
|
|
|
|
|
|
|
|||||
CET 1 risk-based capital ratio
|
|
12.41
|
%
|
|
12.06
|
%
|
|
12.65
|
%
|
|
6.5
|
%
|
|
4.5
|
%
|
Tier 1 risk-based capital ratio
|
|
12.41
|
|
|
12.06
|
|
|
12.65
|
|
|
8.0
|
|
|
6.0
|
|
Total risk-based capital ratio
|
|
13.32
|
|
|
13.04
|
|
|
13.66
|
|
|
10.0
|
|
|
8.0
|
|
Tier 1 leverage ratio
|
|
8.10
|
|
|
7.56
|
|
|
7.67
|
|
|
5.0
|
|
|
4.0
|
|
Tangible common equity to tangible assets ratio (1)(2)
|
|
8.13
|
|
|
7.47
|
|
|
7.77
|
|
|
N/A
|
|
|
N/A
|
|
Tangible common equity to risk-weighted assets ratio (1)(2)
|
|
12.28
|
|
|
11.98
|
|
|
12.75
|
|
|
N/A
|
|
|
N/A
|
|
|
(1)
|
See below for a reconciliation of non-GAAP tangible common equity to tangible assets and tangible common equity to risk-weighted assets.
|
(2)
|
The FRB has not issued any minimum guidelines for the tangible common equity to tangible assets ratio or the tangible common equity to risk-weighted assets ratio. However, we believe these ratios provide meaningful supplemental information regarding our capital levels and are therefore provided above.
|
Non-GAAP tangible common equity and tangible assets
(Dollars in thousands, except ratios)
|
|
SVB Financial
|
||||||||||||||||||
|
December 31,
2018 |
|
December 31,
2017 |
|
December 31,
2016 |
|
December 31,
2015 |
|
December 31,
2014 |
|||||||||||
GAAP SVBFG stockholders’ equity
|
|
$
|
5,116,209
|
|
|
$
|
4,179,795
|
|
|
$
|
3,642,554
|
|
|
$
|
3,198,134
|
|
|
$
|
2,813,072
|
|
Tangible common equity
|
|
$
|
5,116,209
|
|
|
$
|
4,179,795
|
|
|
$
|
3,642,554
|
|
|
$
|
3,198,134
|
|
|
$
|
2,813,072
|
|
GAAP total assets
|
|
$
|
56,927,979
|
|
|
$
|
51,214,467
|
|
|
$
|
44,683,660
|
|
|
$
|
44,686,703
|
|
|
$
|
39,337,869
|
|
Tangible assets
|
|
$
|
56,927,979
|
|
|
$
|
51,214,467
|
|
|
$
|
44,683,660
|
|
|
$
|
44,686,703
|
|
|
$
|
39,337,869
|
|
Risk-weighted assets
|
|
$
|
38,527,853
|
|
|
$
|
32,736,959
|
|
|
$
|
28,248,750
|
|
|
$
|
25,919,594
|
|
|
$
|
21,755,091
|
|
Non-GAAP tangible common equity to tangible assets
|
|
8.99
|
%
|
|
8.16
|
%
|
|
8.15
|
%
|
|
7.16
|
%
|
|
7.15
|
%
|
|||||
Non-GAAP tangible common equity to risk-weighted assets
|
|
13.28
|
|
|
12.77
|
|
|
12.89
|
|
|
12.34
|
|
|
12.93
|
|
Non-GAAP tangible common equity and tangible assets
(Dollars in thousands, except ratios)
|
|
Bank
|
||||||||||||||||||
|
December 31,
2018 |
|
December 31,
2017 |
|
December 31,
2016 |
|
December 31,
2015 |
|
December 31,
2014 |
|||||||||||
Tangible common equity
|
|
$
|
4,554,814
|
|
|
$
|
3,762,542
|
|
|
$
|
3,423,427
|
|
|
$
|
3,059,045
|
|
|
$
|
2,399,411
|
|
Tangible assets
|
|
$
|
56,047,134
|
|
|
$
|
50,383,774
|
|
|
$
|
44,059,340
|
|
|
$
|
44,045,967
|
|
|
$
|
37,607,973
|
|
Risk-weighted assets
|
|
$
|
37,104,080
|
|
|
$
|
31,403,489
|
|
|
$
|
26,856,850
|
|
|
$
|
24,301,043
|
|
|
$
|
21,450,480
|
|
Non-GAAP tangible common equity to tangible assets
|
|
8.13
|
%
|
|
7.47
|
%
|
|
7.77
|
%
|
|
6.95
|
%
|
|
6.38
|
%
|
|||||
Non-GAAP tangible common equity to risk-weighted assets
|
|
12.28
|
|
|
11.98
|
|
|
12.75
|
|
|
12.59
|
|
|
11.19
|
|
|
|
Amount of Commitments Expiring per Period
|
||||||||||||||||||
(Dollars in thousands)
|
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
4-5 years
|
|
After 5 years
|
||||||||||
Commercial commitments:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loan commitments available for funding
|
|
$
|
16,661,005
|
|
|
$
|
13,182,605
|
|
|
$
|
2,181,193
|
|
|
$
|
919,829
|
|
|
$
|
377,378
|
|
Standby letters of credit
|
|
2,214,342
|
|
|
2,177,026
|
|
|
31,753
|
|
|
2,868
|
|
|
2,695
|
|
|||||
Commercial letters of credit
|
|
37,674
|
|
|
37,323
|
|
|
300
|
|
|
51
|
|
|
—
|
|
|||||
Total unfunded credit commitments
|
|
$
|
18,913,021
|
|
|
$
|
15,396,954
|
|
|
$
|
2,213,246
|
|
|
$
|
922,748
|
|
|
$
|
380,073
|
|
|
|
Payments Due By Period
|
||||||||||||||||||
(Dollars in thousands)
|
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
4-5 years
|
|
After 5 years
|
||||||||||
SVBFG contractual obligations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits (1) (2)
|
|
$
|
49,328,900
|
|
|
$
|
49,328,900
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Borrowings (2)
|
|
1,327,877
|
|
|
631,412
|
|
|
348,826
|
|
|
—
|
|
|
347,639
|
|
|||||
Non-cancelable operating leases
|
|
223,672
|
|
|
38,609
|
|
|
73,429
|
|
|
62,563
|
|
|
49,071
|
|
|||||
Commitments to qualified affordable housing projects
|
|
205,685
|
|
|
55,662
|
|
|
133,621
|
|
|
3,933
|
|
|
12,469
|
|
|||||
Other obligations
|
|
16,655
|
|
|
7,484
|
|
|
9,171
|
|
|
—
|
|
|
—
|
|
|||||
Total obligations attributable to SVBFG
|
|
$
|
51,102,789
|
|
|
$
|
50,062,067
|
|
|
$
|
565,047
|
|
|
$
|
66,496
|
|
|
$
|
409,179
|
|
|
(1)
|
Includes time deposits and deposits with no defined maturity, such as noninterest-bearing demand, interest-bearing checking, savings, money market and sweep accounts.
|
(2)
|
Amounts exclude contractual interest.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Average cash and cash equivalents
|
|
$
|
3,301,783
|
|
|
$
|
3,484,651
|
|
|
$
|
2,863,777
|
|
Percentage of total average assets
|
|
6.0
|
%
|
|
7.2
|
%
|
|
6.5
|
%
|
|||
Net cash provided by operating activities
|
|
$
|
933,562
|
|
|
$
|
646,865
|
|
|
$
|
471,760
|
|
Net cash (used for) provided by investing activities
|
|
(4,800,375
|
)
|
|
(5,970,496
|
)
|
|
981,561
|
|
|||
Net cash provided by (used for) financing activities
|
|
4,515,277
|
|
|
5,700,956
|
|
|
(410,828
|
)
|
|||
Net increase in cash and cash equivalents
|
|
$
|
648,464
|
|
|
$
|
377,325
|
|
|
$
|
1,042,493
|
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Change in interest rates (bps)
(Dollars in thousands)
|
|
Estimated
|
|
Estimated Increase/(Decrease) In EVE
|
|
Estimated
|
|
Estimated Increase/
(Decrease) In NII
|
||||||||||||||
|
EVE
|
|
Amount
|
|
Percent
|
|
NII
|
|
Amount
|
|
Percent
|
|||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
+200
|
|
$
|
9,348,408
|
|
|
$
|
504,405
|
|
|
5.7
|
%
|
|
$
|
2,628,279
|
|
|
$
|
543,959
|
|
|
26.1
|
%
|
+100
|
|
9,090,781
|
|
|
246,778
|
|
|
2.8
|
|
|
2,356,447
|
|
|
272,127
|
|
|
13.1
|
|
||||
—
|
|
8,844,003
|
|
|
—
|
|
|
—
|
|
|
2,084,320
|
|
|
—
|
|
|
—
|
|
||||
-100
|
|
8,470,501
|
|
|
(373,502
|
)
|
|
(4.2
|
)
|
|
1,807,559
|
|
|
(276,761
|
)
|
|
(13.3
|
)
|
||||
-200
|
|
7,590,973
|
|
|
(1,253,030
|
)
|
|
(14.2
|
)
|
|
1,528,693
|
|
|
(555,627
|
)
|
|
(26.7
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
+200
|
|
$
|
8,091,107
|
|
|
$
|
805,624
|
|
|
11.1
|
%
|
|
$
|
1,885,885
|
|
|
$
|
400,127
|
|
|
26.9
|
%
|
+100
|
|
7,716,066
|
|
|
430,583
|
|
|
5.9
|
|
|
1,683,742
|
|
|
197,984
|
|
|
13.3
|
|
||||
—
|
|
7,285,483
|
|
|
—
|
|
|
—
|
|
|
1,485,758
|
|
|
—
|
|
|
—
|
|
||||
-100
|
|
6,637,588
|
|
|
(647,895
|
)
|
|
(8.9
|
)
|
|
1,252,063
|
|
|
(233,695
|
)
|
|
(15.7
|
)
|
||||
-200
|
|
5,718,401
|
|
|
(1,567,082
|
)
|
|
(21.5
|
)
|
|
1,108,712
|
|
|
(377,046
|
)
|
|
(25.4
|
)
|
|
|
December 31,
|
||||||
(Dollars in thousands, except par value and share data)
|
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
3,571,539
|
|
|
$
|
2,923,075
|
|
Available-for-sale securities, at fair value (cost of $7,862,311 and $11,131,008, respectively)
|
|
7,790,043
|
|
|
11,120,664
|
|
||
Held-to-maturity securities, at cost (fair value of $15,188,236 and $12,548,280, respectively)
|
|
15,487,442
|
|
|
12,663,455
|
|
||
Non-marketable and other equity securities
|
|
941,104
|
|
|
651,053
|
|
||
Total investment securities
|
|
24,218,589
|
|
|
24,435,172
|
|
||
Loans, net of unearned income
|
|
28,338,280
|
|
|
23,106,316
|
|
||
Allowance for loan losses
|
|
(280,903
|
)
|
|
(255,024
|
)
|
||
Net loans
|
|
28,057,377
|
|
|
22,851,292
|
|
||
Premises and equipment, net of accumulated depreciation and amortization
|
|
129,213
|
|
|
128,682
|
|
||
Accrued interest receivable and other assets
|
|
951,261
|
|
|
876,246
|
|
||
Total assets
|
|
$
|
56,927,979
|
|
|
$
|
51,214,467
|
|
Liabilities and total equity
|
|
|
|
|
||||
Liabilities:
|
|
|
|
|
||||
Noninterest-bearing demand deposits
|
|
$
|
39,103,422
|
|
|
$
|
36,655,497
|
|
Interest-bearing deposits
|
|
10,225,478
|
|
|
7,598,578
|
|
||
Total deposits
|
|
49,328,900
|
|
|
44,254,075
|
|
||
Short-term borrowings
|
|
631,412
|
|
|
1,033,730
|
|
||
Other liabilities
|
|
1,006,359
|
|
|
911,755
|
|
||
Long-term debt
|
|
696,465
|
|
|
695,492
|
|
||
Total liabilities
|
|
51,663,136
|
|
|
46,895,052
|
|
||
Commitments and contingencies (Note 19 and Note 25)
|
|
|
|
|
|
|||
SVBFG stockholders’ equity:
|
|
|
|
|
||||
Preferred stock, $0.001 par value, 20,000,000 shares authorized; no shares issued and outstanding
|
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, 150,000,000 shares authorized; 52,586,498 shares and 52,835,188 shares issued and outstanding, respectively
|
|
53
|
|
|
53
|
|
||
Additional paid-in capital
|
|
1,378,438
|
|
|
1,314,377
|
|
||
Retained earnings
|
|
3,791,838
|
|
|
2,866,837
|
|
||
Accumulated other comprehensive loss
|
|
(54,120
|
)
|
|
(1,472
|
)
|
||
Total SVBFG stockholders’ equity
|
|
5,116,209
|
|
|
4,179,795
|
|
||
Noncontrolling interests
|
|
148,634
|
|
|
139,620
|
|
||
Total equity
|
|
5,264,843
|
|
|
4,319,415
|
|
||
Total liabilities and total equity
|
|
$
|
56,927,979
|
|
|
$
|
51,214,467
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands, except per share amounts)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Interest income:
|
|
|
|
|
|
|
||||||
Loans
|
|
$
|
1,358,480
|
|
|
$
|
1,025,788
|
|
|
$
|
834,155
|
|
Investment securities:
|
|
|
|
|
|
|
||||||
Taxable
|
|
541,605
|
|
|
412,133
|
|
|
346,937
|
|
|||
Non-taxable
|
|
34,616
|
|
|
5,714
|
|
|
2,234
|
|
|||
Federal funds sold, securities purchased under agreements to resell and other short-term investment securities
|
|
35,208
|
|
|
21,505
|
|
|
10,070
|
|
|||
Total interest income
|
|
1,969,909
|
|
|
1,465,140
|
|
|
1,193,396
|
|
|||
Interest expense:
|
|
|
|
|
|
|
||||||
Deposits
|
|
29,306
|
|
|
8,676
|
|
|
5,611
|
|
|||
Borrowings
|
|
46,615
|
|
|
36,095
|
|
|
37,262
|
|
|||
Total interest expense
|
|
75,921
|
|
|
44,771
|
|
|
42,873
|
|
|||
Net interest income
|
|
1,893,988
|
|
|
1,420,369
|
|
|
1,150,523
|
|
|||
Provision for credit losses (1)
|
|
87,870
|
|
|
92,304
|
|
|
106,679
|
|
|||
Net interest income after provision for credit losses
|
|
1,806,118
|
|
|
1,328,065
|
|
|
1,043,844
|
|
|||
Noninterest income:
|
|
|
|
|
|
|
||||||
Gains on investment securities, net
|
|
88,094
|
|
|
64,603
|
|
|
51,740
|
|
|||
Gains on equity warrant assets, net (2)
|
|
89,142
|
|
|
54,555
|
|
|
37,892
|
|
|||
Foreign exchange fees
|
|
138,812
|
|
|
115,760
|
|
|
104,183
|
|
|||
Credit card fees
|
|
94,072
|
|
|
76,543
|
|
|
68,205
|
|
|||
Deposit service charges
|
|
76,097
|
|
|
58,715
|
|
|
52,524
|
|
|||
Client investment fees
|
|
130,360
|
|
|
56,136
|
|
|
32,219
|
|
|||
Lending related fees
|
|
41,949
|
|
|
43,265
|
|
|
33,395
|
|
|||
Letters of credit and standby letters of credit fees
|
|
34,600
|
|
|
28,544
|
|
|
25,644
|
|
|||
Other (2)
|
|
51,858
|
|
|
59,110
|
|
|
50,750
|
|
|||
Total noninterest income
|
|
744,984
|
|
|
557,231
|
|
|
456,552
|
|
|||
Noninterest expense:
|
|
|
|
|
|
|
||||||
Compensation and benefits
|
|
726,980
|
|
|
606,402
|
|
|
514,270
|
|
|||
Professional services
|
|
158,835
|
|
|
121,935
|
|
|
94,982
|
|
|||
Premises and equipment
|
|
77,918
|
|
|
71,753
|
|
|
65,502
|
|
|||
Net occupancy
|
|
54,753
|
|
|
48,397
|
|
|
39,928
|
|
|||
Business development and travel
|
|
48,180
|
|
|
41,978
|
|
|
40,130
|
|
|||
FDIC and state assessments
|
|
34,276
|
|
|
35,069
|
|
|
30,285
|
|
|||
Correspondent bank fees
|
|
13,713
|
|
|
12,976
|
|
|
12,457
|
|
|||
Other
|
|
73,538
|
|
|
72,145
|
|
|
62,243
|
|
|||
Total noninterest expense (1)
|
|
1,188,193
|
|
|
1,010,655
|
|
|
859,797
|
|
|||
Income before income tax expense
|
|
1,362,909
|
|
|
874,641
|
|
|
640,599
|
|
|||
Income tax expense (3)
|
|
351,561
|
|
|
355,463
|
|
|
250,333
|
|
|||
Net income before noncontrolling interests
|
|
1,011,348
|
|
|
519,178
|
|
|
390,266
|
|
|||
Net income attributable to noncontrolling interests
|
|
(37,508
|
)
|
|
(28,672
|
)
|
|
(7,581
|
)
|
|||
Net income available to common stockholders (3)
|
|
$
|
973,840
|
|
|
$
|
490,506
|
|
|
$
|
382,685
|
|
Earnings per common share—basic (3)
|
|
$
|
18.35
|
|
|
$
|
9.33
|
|
|
$
|
7.37
|
|
Earnings per common share—diluted (3)
|
|
18.11
|
|
|
9.20
|
|
|
7.31
|
|
|
(1)
|
Our consolidated statements of income for the year ended December 31, 2016 was modified from prior periods’ presentation to conform to the current period's presentation, which reflects our provision for loan losses and provision for unfunded credit commitments together as our “provision for credit losses”. In prior periods, our provision for unfunded credit commitments were reported separately as a component of noninterest expense.
|
(2)
|
Our consolidated statements of income for the year ended December 31, 2016 was modified from prior periods’ presentation to conform to the current period's presentation, which reflects a new line item to separately disclose net gains on equity warrant assets. In prior periods, net gains on equity warrant assets were reported as a component of net gains on derivative instruments. We removed the line item "gains on derivative instruments, net" and reclassified all other gains on derivative instruments, net to other noninterest income.
|
(3)
|
Included in income tax expense, net income available to common stockholders, earnings per common share-basic and earnings for common share-diluted, for the years ended December 31, 2018 and 2017, are tax benefits recognized associated with the adoption of Accounting Standards Update ("ASU") 2016-09, Improvements to Employee Share-Based Payment Accounting in the first quarter of 2017. This guidance was adopted on a prospective basis with no change to prior period amounts.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income before noncontrolling interests
|
|
$
|
1,011,348
|
|
|
$
|
519,178
|
|
|
$
|
390,266
|
|
Other comprehensive (loss) income, net of tax:
|
|
|
|
|
|
|
||||||
Change in foreign currency cumulative translation gains and losses:
|
|
|
|
|
|
|
||||||
Foreign currency translation (losses) gains
|
|
(5,999
|
)
|
|
6,355
|
|
|
(5,245
|
)
|
|||
Related tax benefit (expense)
|
|
1,669
|
|
|
(2,587
|
)
|
|
2,050
|
|
|||
Change in unrealized gains and losses on available-for-sale securities:
|
|
|
|
|
|
|
||||||
Unrealized holding (losses) gains
|
|
(22,348
|
)
|
|
(47,161
|
)
|
|
39,016
|
|
|||
Related tax benefit (expense)
|
|
6,315
|
|
|
19,282
|
|
|
(15,911
|
)
|
|||
Reclassification adjustment for losses (gains) included in net
income (1)
|
|
740
|
|
|
5,189
|
|
|
(12,195
|
)
|
|||
Related tax (benefit) expense (1)
|
|
(205
|
)
|
|
(2,098
|
)
|
|
4,963
|
|
|||
Reclassification of unrealized gains on equity securities to retained earnings for ASU 2016-01 (1)
|
|
(40,316
|
)
|
|
—
|
|
|
—
|
|
|||
Related tax expense (1)
|
|
11,145
|
|
|
—
|
|
|
—
|
|
|||
Amortization of unrealized gains on securities transferred from
available-for-sale to held-to-maturity
|
|
(4,607
|
)
|
|
(6,475
|
)
|
|
(7,786
|
)
|
|||
Related tax benefit
|
|
1,277
|
|
|
2,593
|
|
|
3,134
|
|
|||
Reclassification of stranded tax effect to retained earnings for ASU 2018-02 (1)
|
|
(319
|
)
|
|
—
|
|
|
—
|
|
|||
Other comprehensive (loss) income, net of tax
|
|
(52,648
|
)
|
|
(24,902
|
)
|
|
8,026
|
|
|||
Comprehensive income
|
|
958,700
|
|
|
494,276
|
|
|
398,292
|
|
|||
Comprehensive income attributable to noncontrolling interests
|
|
(37,508
|
)
|
|
(28,672
|
)
|
|
(7,581
|
)
|
|||
Comprehensive income attributable to SVBFG
|
|
$
|
921,192
|
|
|
$
|
465,604
|
|
|
$
|
390,711
|
|
|
(1)
|
See Note 2- "Summary of Significant Accounting Policies" of the "Notes to Consolidated Financial Statements" under Part II, Item 8 of this report for additional details.
|
|
|
Common Stock
|
|
Additional
Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other
Comprehensive Income (Loss)
|
|
Total SVBFG
Stockholders’ Equity
|
|
Noncontrolling Interests
|
|
Total Equity
|
|||||||||||||||||
(Dollars in thousands, except share data)
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance at December 31, 2015
|
|
51,610,226
|
|
|
$
|
52
|
|
|
$
|
1,189,032
|
|
|
$
|
1,993,646
|
|
|
$
|
15,404
|
|
|
$
|
3,198,134
|
|
|
$
|
135,097
|
|
|
$
|
3,333,231
|
|
Common stock issued under employee benefit plans, net of restricted stock cancellations
|
|
600,683
|
|
|
—
|
|
|
21,819
|
|
|
—
|
|
|
—
|
|
|
21,819
|
|
|
—
|
|
|
21,819
|
|
|||||||
Common stock issued under ESOP
|
|
43,165
|
|
|
—
|
|
|
4,328
|
|
|
—
|
|
|
—
|
|
|
4,328
|
|
|
—
|
|
|
4,328
|
|
|||||||
Income tax effect from stock options exercised, vesting of restricted stock and other (1)
|
|
—
|
|
|
—
|
|
|
(3,640
|
)
|
|
—
|
|
|
—
|
|
|
(3,640
|
)
|
|
—
|
|
|
(3,640
|
)
|
|||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
382,685
|
|
|
—
|
|
|
382,685
|
|
|
7,581
|
|
|
390,266
|
|
|||||||
Capital calls and distributions, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,195
|
)
|
|
(8,195
|
)
|
|||||||
Net change in unrealized gains and losses on AFS securities, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,873
|
|
|
15,873
|
|
|
—
|
|
|
15,873
|
|
|||||||
Amortization of unrealized gains on securities transferred from AFS to HTM, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,652
|
)
|
|
(4,652
|
)
|
|
—
|
|
|
(4,652
|
)
|
|||||||
Foreign currency translation adjustments, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,195
|
)
|
|
(3,195
|
)
|
|
—
|
|
|
(3,195
|
)
|
|||||||
Share-based compensation, net
|
|
—
|
|
|
—
|
|
|
31,202
|
|
|
—
|
|
|
—
|
|
|
31,202
|
|
|
—
|
|
|
31,202
|
|
|||||||
Balance at December 31, 2016
|
|
52,254,074
|
|
|
$
|
52
|
|
|
$
|
1,242,741
|
|
|
$
|
2,376,331
|
|
|
$
|
23,430
|
|
|
$
|
3,642,554
|
|
|
$
|
134,483
|
|
|
$
|
3,777,037
|
|
Common stock issued under employee benefit plans, net of restricted stock cancellations
|
|
570,276
|
|
|
1
|
|
|
24,908
|
|
|
—
|
|
|
—
|
|
|
24,909
|
|
|
—
|
|
|
24,909
|
|
|||||||
Common stock issued under ESOP
|
|
10,838
|
|
|
—
|
|
|
2,094
|
|
|
—
|
|
|
—
|
|
|
2,094
|
|
|
—
|
|
|
2,094
|
|
|||||||
Income tax effect from stock options exercised, vesting of restricted stock and other (1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
490,506
|
|
|
—
|
|
|
490,506
|
|
|
28,672
|
|
|
519,178
|
|
|||||||
Capital calls and distributions, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,535
|
)
|
|
(23,535
|
)
|
|||||||
Net change in unrealized gains and losses on AFS securities, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,788
|
)
|
|
(24,788
|
)
|
|
—
|
|
|
(24,788
|
)
|
|||||||
Amortization of unrealized gains on securities transferred from AFS to HTM, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,882
|
)
|
|
(3,882
|
)
|
|
—
|
|
|
(3,882
|
)
|
|||||||
Foreign currency translation adjustments, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,768
|
|
|
3,768
|
|
|
—
|
|
|
3,768
|
|
|||||||
Share-based compensation, net
|
|
—
|
|
|
—
|
|
|
44,634
|
|
|
—
|
|
|
—
|
|
|
44,634
|
|
|
—
|
|
|
44,634
|
|
|||||||
Balance at December 31, 2017
|
|
52,835,188
|
|
|
$
|
53
|
|
|
$
|
1,314,377
|
|
|
$
|
2,866,837
|
|
|
$
|
(1,472
|
)
|
|
$
|
4,179,795
|
|
|
$
|
139,620
|
|
|
$
|
4,319,415
|
|
Cumulative adjustment for ASU 2014-09, net of tax (2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,802
|
)
|
|
—
|
|
|
(5,802
|
)
|
|
—
|
|
|
(5,802
|
)
|
|||||||
Cumulative adjustment for ASU 2016-01, net of tax (2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
103,766
|
|
|
(29,171
|
)
|
|
74,595
|
|
|
—
|
|
|
74,595
|
|
|||||||
Reclassification of stranded tax effect for ASU 2018-02 (2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
319
|
|
|
(319
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Common stock issued under employee benefit plans, net of restricted stock cancellations
|
|
456,845
|
|
|
1
|
|
|
15,809
|
|
|
—
|
|
|
—
|
|
|
15,810
|
|
|
—
|
|
|
15,810
|
|
|||||||
Common stock issued under ESOP
|
|
9,672
|
|
|
—
|
|
|
2,577
|
|
|
—
|
|
|
—
|
|
|
2,577
|
|
|
—
|
|
|
2,577
|
|
|||||||
Income tax effect from stock options exercised, vesting of restricted stock and other (1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
973,840
|
|
|
—
|
|
|
973,840
|
|
|
37,508
|
|
|
1,011,348
|
|
|||||||
Capital calls and distributions, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28,494
|
)
|
|
(28,494
|
)
|
|||||||
Net change in unrealized gains and losses on AFS securities, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,498
|
)
|
|
(15,498
|
)
|
|
—
|
|
|
(15,498
|
)
|
|||||||
Amortization of unrealized gains on securities transferred from AFS to HTM, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,330
|
)
|
|
(3,330
|
)
|
|
—
|
|
|
(3,330
|
)
|
|||||||
Foreign currency translation adjustments, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,330
|
)
|
|
(4,330
|
)
|
|
—
|
|
|
(4,330
|
)
|
|||||||
Share-based compensation, net
|
|
—
|
|
|
—
|
|
|
45,675
|
|
|
—
|
|
|
—
|
|
|
45,675
|
|
|
—
|
|
|
45,675
|
|
|||||||
Common stock repurchases
|
|
(715,207
|
)
|
|
(1
|
)
|
|
—
|
|
|
(147,122
|
)
|
|
—
|
|
|
(147,123
|
)
|
|
—
|
|
|
(147,123
|
)
|
|||||||
Balance at December 31, 2018
|
|
52,586,498
|
|
|
$
|
53
|
|
|
$
|
1,378,438
|
|
|
$
|
3,791,838
|
|
|
$
|
(54,120
|
)
|
|
$
|
5,116,209
|
|
|
$
|
148,634
|
|
|
$
|
5,264,843
|
|
|
(1)
|
During the first quarter of 2017 we adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting. The amendments in this ASU require that all excess tax benefits and tax deficiencies associated with share-based compensation be recognized in income tax expense or benefit in the income statement. This guidance was adopted on a prospective basis with no change to prior period amounts.
|
(2)
|
See Note 2- "Summary of Significant Accounting Policies" of the "Notes to Consolidated Financial Statements" under Part II, Item 8 of this report for additional details.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income before noncontrolling interests
|
|
$
|
1,011,348
|
|
|
$
|
519,178
|
|
|
$
|
390,266
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Provision for credit losses
|
|
87,870
|
|
|
92,304
|
|
|
106,679
|
|
|||
Change in fair value of equity warrant assets, net of proceeds from exercises
|
|
(24,417
|
)
|
|
(11,862
|
)
|
|
(9,251
|
)
|
|||
Changes in fair values of derivatives, net
|
|
(11,043
|
)
|
|
14,261
|
|
|
(9,036
|
)
|
|||
Gains on investment securities, net (1)
|
|
(88,094
|
)
|
|
(45,547
|
)
|
|
(21,753
|
)
|
|||
Distributions of earnings from non-marketable and other equity securities (1)
|
|
72,015
|
|
|
45,867
|
|
|
15,991
|
|
|||
Depreciation and amortization
|
|
57,906
|
|
|
56,123
|
|
|
46,819
|
|
|||
Amortization of premiums and discounts on investment securities, net
|
|
(28
|
)
|
|
2,530
|
|
|
6,582
|
|
|||
Amortization of share-based compensation
|
|
45,675
|
|
|
36,900
|
|
|
35,494
|
|
|||
Amortization of deferred loan fees
|
|
(128,077
|
)
|
|
(111,738
|
)
|
|
(98,150
|
)
|
|||
Deferred income tax (benefit) expense
|
|
(21,061
|
)
|
|
25,187
|
|
|
(4,235
|
)
|
|||
Excess tax benefit from exercise of stock options and vesting of restricted shares (2)
|
|
(17,989
|
)
|
|
(18,014
|
)
|
|
—
|
|
|||
Losses from the write-off of premises and equipment
|
|
7,278
|
|
|
—
|
|
|
—
|
|
|||
Other gains
|
|
—
|
|
|
(3,308
|
)
|
|
(12,195
|
)
|
|||
Changes in other assets and liabilities:
|
|
|
|
|
|
|
||||||
Accrued interest receivable and payable, net
|
|
(55,834
|
)
|
|
(31,372
|
)
|
|
(3,663
|
)
|
|||
Accounts receivable and payable, net
|
|
(23,020
|
)
|
|
3,481
|
|
|
(4,945
|
)
|
|||
Income tax receivable and payable, net
|
|
(5,820
|
)
|
|
46,168
|
|
|
3,672
|
|
|||
Accrued compensation
|
|
56,874
|
|
|
31,689
|
|
|
(15,292
|
)
|
|||
Foreign exchange spot contracts, net
|
|
24,018
|
|
|
(20,891
|
)
|
|
3,093
|
|
|||
Other, net
|
|
(54,039
|
)
|
|
15,909
|
|
|
41,684
|
|
|||
Net cash provided by operating activities
|
|
933,562
|
|
|
646,865
|
|
|
471,760
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
||||||
Purchases of available-for-sale securities
|
|
(668,264
|
)
|
|
(2,420,741
|
)
|
|
(429,268
|
)
|
|||
Proceeds from sales of available-for-sale securities
|
|
474,482
|
|
|
580,871
|
|
|
2,892,460
|
|
|||
Proceeds from maturities and paydowns of available-for-sale securities
|
|
3,436,064
|
|
|
3,339,574
|
|
|
1,364,398
|
|
|||
Purchases of held-to-maturity securities
|
|
(4,726,595
|
)
|
|
(5,967,223
|
)
|
|
(1,306,010
|
)
|
|||
Proceeds from maturities and paydowns of held-to-maturity securities
|
|
1,891,761
|
|
|
1,708,001
|
|
|
1,656,580
|
|
|||
Purchases of non-marketable and other equity securities
|
|
(81,574
|
)
|
|
(44,047
|
)
|
|
(48,932
|
)
|
|||
Proceeds from sales and distributions of capital of non-marketable and other equity securities (1)
|
|
95,025
|
|
|
51,052
|
|
|
62,925
|
|
|||
Net increase in loans
|
|
(5,175,409
|
)
|
|
(3,170,099
|
)
|
|
(3,157,281
|
)
|
|||
Purchases of premises and equipment
|
|
(45,865
|
)
|
|
(50,884
|
)
|
|
(53,311
|
)
|
|||
Proceeds from sale of equity valuation services business
|
|
—
|
|
|
3,000
|
|
|
—
|
|
|||
Net cash (used for) provided by investing activities
|
|
(4,800,375
|
)
|
|
(5,970,496
|
)
|
|
981,561
|
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
||||||
Net increase (decrease) in deposits
|
|
5,074,825
|
|
|
5,274,207
|
|
|
(162,908
|
)
|
|||
Net (decrease) increase in short-term borrowings
|
|
(402,318
|
)
|
|
521,062
|
|
|
(262,232
|
)
|
|||
Principal payments of long-term debt
|
|
—
|
|
|
(97,781
|
)
|
|
—
|
|
|||
(Distributions to noncontrolling interests), net of contributions from noncontrolling interests
|
|
(28,494
|
)
|
|
(23,535
|
)
|
|
(8,195
|
)
|
|||
Common stock repurchase
|
|
(147,123
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from issuance of common stock, ESPP and ESOP
|
|
18,387
|
|
|
27,003
|
|
|
26,147
|
|
|||
Tax effect from stock exercises (2)
|
|
—
|
|
|
—
|
|
|
(3,640
|
)
|
|||
Net cash provided by (used for) by financing activities
|
|
4,515,277
|
|
|
5,700,956
|
|
|
(410,828
|
)
|
|||
Net increase in cash and cash equivalents
|
|
648,464
|
|
|
377,325
|
|
|
1,042,493
|
|
|||
Cash and cash equivalents at beginning of period
|
|
2,923,075
|
|
|
2,545,750
|
|
|
1,503,257
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
3,571,539
|
|
|
$
|
2,923,075
|
|
|
$
|
2,545,750
|
|
Supplemental disclosures:
|
|
|
|
|
|
|
||||||
Cash paid during the period for:
|
|
|
|
|
|
|
||||||
Interest
|
|
$
|
75,601
|
|
|
$
|
45,592
|
|
|
$
|
42,918
|
|
Income taxes
|
|
376,425
|
|
|
277,823
|
|
|
240,752
|
|
|||
Noncash items during the period:
|
|
|
|
|
|
|
||||||
Changes in unrealized gains and losses on available-for-sale securities, net of tax
|
|
$
|
(15,498
|
)
|
|
$
|
(24,788
|
)
|
|
$
|
15,873
|
|
Distributions of stock from investments
|
|
5,277
|
|
|
6,807
|
|
|
1,315
|
|
|
(1)
|
During the first quarter of 2018 we adopted ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This guidance was adopted on a retrospective basis and impacted the presentation between investing and operating activities related to distributions and net gains from our non-marketable and other equity securities portfolio. See
Note 2—“Summary of Significant Accounting Policies” of the “Notes to the Consolidated Financial Statements” under Part II, Item 8 of this report
for additional details.
|
(2)
|
In 2017 we adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting on a prospective basis with no change to prior period amounts.
Note 2—“Summary of Significant Accounting Policies” of the “Notes to the Consolidated Financial Statements” under Part II, Item 8 of this report
for additional details.
|
1.
|
Nature of Business
|
2.
|
Summary of Significant Accounting Policies
|
•
|
The length of time and the extent to which the fair value has been less than the amortized cost basis (severity and duration);
|
•
|
Adverse conditions specifically related to the security, an industry, or geographic area; for example, changes in the financial condition of the issuer of the security, or in the case of an asset-backed debt security, changes in the financial condition of the underlying loan obligors. Examples of those changes include any of the following:
|
◦
|
Changes in technology;
|
◦
|
The discontinuance of a segment of the business that may affect the future earnings potential of the issuer or underlying loan obligors of the security; and
|
◦
|
Changes in the quality of the credit enhancement.
|
•
|
The historical and implied volatility of the fair value of the security;
|
•
|
The payment structure of the debt security and the likelihood of the issuer being able to make payments that increase in the future;
|
•
|
Failure of the issuer of the security to make scheduled interest or principal payments;
|
•
|
Any changes to the rating of the security by a rating agency; and
|
•
|
Recoveries or additional declines in fair value after the balance sheet date.
|
•
|
Funds of funds, which make investments in venture capital and private equity funds, and
|
•
|
Direct venture funds, which make equity investments in privately held companies.
|
Limited partnership
|
|
Company Direct and Indirect Ownership in Limited Partnership
|
|
Managed funds of funds
|
|
|
|
Strategic Investors Fund, LP
|
|
12.6
|
%
|
Capital Preferred Return Fund, LP
|
|
20.0
|
|
Growth Partners, LP
|
|
33.0
|
|
Managed direct venture funds
|
|
|
|
CP I, LP
|
|
10.7
|
|
•
|
Equity securities, such as preferred or common stock in privately-held companies in which we hold a voting interest of at least
20 percent
, or in which we have the ability to exercise significant influence over the investees' operating and financial policies through board involvement or other influence, are accounted for under the equity method,
|
•
|
Investments in limited partnerships in which we hold voting interests of more than
5 percent
, or in which we have the ability to exercise significant influence over the partnerships' operating and financial policies, are accounted for using the equity method, and
|
•
|
Our China Joint Venture partnership, for which we have
50 percent
ownership, is accounted for under the equity method.
|
•
|
Changes in lending policies and procedures, including underwriting standards and collections, and charge-off and recovery practices;
|
•
|
Changes in national and local economic business conditions, including the market and economic condition of our clients' industry sectors;
|
•
|
Changes in the nature of our loan portfolio;
|
•
|
Changes in experience, ability, and depth of lending management and staff;
|
•
|
Changes in the trend of the volume and severity of past due and classified loans;
|
•
|
Changes in the trend of the volume of nonaccrual loans, troubled debt restructurings, and other loan modifications;
|
•
|
Reserve floor for portfolio segments that would not draw a minimum reserve based on the lack of historical loan loss experience;
|
•
|
Reserve for large funded loan exposure;
|
•
|
Reserve for performing impaired loan exposure; and
|
•
|
Other factors as determined by management from time to time.
|
Leasehold improvements
|
|
Lesser of lease term or asset life
|
Furniture and equipment
|
|
7 years
|
Computer software
|
|
3-7 years
|
Computer hardware
|
|
3-5 years
|
•
|
An underlying asset value, which is estimated based on current information available in valuation reports, including any information regarding subsequent rounds of funding or performance of a company.
|
•
|
Stated strike price, which can be adjusted for certain warrants upon the occurrence of subsequent funding rounds or other future events.
|
•
|
Price volatility or risk associated with possible changes in the warrant price. The volatility assumption is based on historical price volatility of publicly traded companies within indices similar in nature to the underlying client companies issuing the warrant. The actual volatility input is based on the mean and median volatility for an individual public company within an index for the past 16 quarters, from which an average volatility was derived.
|
•
|
Actual data on terminations and exercises of our warrants are utilized as the basis for determining the expected remaining life of the warrants in each financial reporting period. Warrants may be exercised in the event of acquisitions, mergers or IPOs, and cancelled due to events such as bankruptcies, restructuring activities or additional financings. These events cause the expected remaining life assumption to be shorter than the contractual term of the warrants.
|
•
|
The risk-free interest rate is derived from the Treasury yield curve and is calculated based on a weighted average of the risk-free interest rates that correspond closest to the expected remaining life of the warrant.
|
•
|
Other adjustments, including a marketability discount, are estimated based on management's judgment about the general industry environment.
|
•
|
Number of shares and contingencies associated with obtaining warrant positions such as the funding of associated loans.
|
(Dollars in thousands)
|
|
Balance at December 31, 2017
|
|
Adjustments Due to Adoption of ASC 606
|
|
Balance at
January 1, 2018
|
||||||
Accrued interest receivable and other assets:
|
|
|
|
|
|
|
||||||
Accounts receivable
|
|
$
|
55,946
|
|
|
$
|
(34,340
|
)
|
|
$
|
21,606
|
|
Other liabilities:
|
|
|
|
|
|
|
||||||
Deferred revenue
|
|
27,057
|
|
|
(26,321
|
)
|
|
736
|
|
|||
Current taxes payable
|
|
4,675
|
|
|
(2,217
|
)
|
|
2,458
|
|
|||
Stockholders' equity:
|
|
|
|
|
|
|
||||||
Retained earnings
|
|
2,866,837
|
|
|
(5,802
|
)
|
|
2,861,035
|
|
|
|
December 31, 2018
|
||||||||||
(Dollars in thousands)
|
|
As Reported
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change
Higher/(Lower)
|
||||||
Accrued interest receivable and other assets:
|
|
|
|
|
|
|
||||||
Accounts receivable
|
|
$
|
55,807
|
|
|
$
|
96,479
|
|
|
$
|
(40,672
|
)
|
Other liabilities:
|
|
|
|
|
|
|
||||||
Deferred revenue
|
|
598
|
|
|
28,478
|
|
|
(27,880
|
)
|
|||
Current taxes payable
|
|
3,330
|
|
|
531
|
|
|
2,799
|
|
|||
Stockholders' equity:
|
|
|
|
|
|
|
||||||
Retained earnings
|
|
3,791,838
|
|
|
3,799,255
|
|
|
(7,417
|
)
|
|
|
Year ended December 31, 2018
|
||||||||||
(Dollars in thousands, except per share amount)
|
|
As Reported
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change
Higher/(Lower)
|
||||||
Other noninterest income:
|
|
|
|
|
|
|
||||||
Fund management fees
|
|
$
|
23,016
|
|
|
$
|
25,213
|
|
|
$
|
(2,197
|
)
|
Income tax expense
|
|
351,561
|
|
|
352,143
|
|
|
(582
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net income available to common stockholders
|
|
973,840
|
|
|
975,455
|
|
|
(1,615
|
)
|
|||
Diluted earnings per share
|
|
18.11
|
|
|
18.14
|
|
|
(0.03
|
)
|
3.
|
Stockholders' Equity and EPS
|
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
Income Statement Location
|
|
2018
|
|
2017
|
|
2016
|
||||||
Reclassification adjustment for losses (gains) included in net income (1)
|
|
Gains on investment securities, net
|
|
$
|
740
|
|
|
$
|
5,189
|
|
|
$
|
(12,195
|
)
|
Related tax (benefit) expense (1)
|
|
Income tax expense
|
|
(205
|
)
|
|
(2,098
|
)
|
|
4,963
|
|
|||
Total reclassification adjustment for losses (gains) included in net income, net of tax (1)
|
|
|
|
$
|
535
|
|
|
$
|
3,091
|
|
|
$
|
(7,232
|
)
|
|
(1)
|
See Note 2- "Summary of Significant Accounting Policies" of the "Notes to Consolidated Financial Statements" under Part II, Item 8 of this report for additional details.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars and shares in thousands, except per share amounts)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Numerator:
|
|
|
|
|
|
|
||||||
Net income available to common stockholders
|
|
$
|
973,840
|
|
|
$
|
490,506
|
|
|
$
|
382,685
|
|
Denominator:
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding—basic
|
|
53,078
|
|
|
52,588
|
|
|
51,915
|
|
|||
Weighted average effect of dilutive securities:
|
|
|
|
|
|
|
||||||
Stock options and ESPP
|
|
377
|
|
|
385
|
|
|
254
|
|
|||
Restricted stock units
|
|
317
|
|
|
333
|
|
|
180
|
|
|||
Weighted average common shares outstanding—diluted
|
|
53,772
|
|
|
53,306
|
|
|
52,349
|
|
|||
Earnings per common share:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
18.35
|
|
|
$
|
9.33
|
|
|
$
|
7.37
|
|
Diluted
|
|
18.11
|
|
|
9.20
|
|
|
7.31
|
|
|
|
Year ended December 31,
|
|||||||
(Shares in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|||
Stock options
|
|
59
|
|
|
73
|
|
|
272
|
|
Restricted stock units
|
|
85
|
|
|
1
|
|
|
1
|
|
Total
|
|
144
|
|
|
74
|
|
|
273
|
|
4.
|
Share-Based Compensation
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Share-based compensation expense
|
|
$
|
45,675
|
|
|
$
|
36,900
|
|
|
$
|
35,494
|
|
Income tax benefit related to share-based compensation expense
|
|
(10,997
|
)
|
|
(12,845
|
)
|
|
(12,505
|
)
|
|||
Capitalized compensation costs
|
|
1,466
|
|
|
1,071
|
|
|
5,580
|
|
(Dollars in thousands)
|
|
Unrecognized
Expense
|
|
Weighted Average Expected Recognition Period - in Years
|
||
Stock options
|
|
$
|
11,994
|
|
|
2.74
|
Restricted stock units
|
|
70,021
|
|
|
2.68
|
|
Total unrecognized share-based compensation expense
|
|
$
|
82,015
|
|
|
|
Equity Incentive Plan Awards
|
|
2018
|
|
2017
|
|
2016
|
||||||
Weighted average expected term of options - in years
|
|
4.8
|
|
|
4.9
|
|
|
4.8
|
|
|||
Weighted average expected volatility of the Company's underlying common stock
|
|
34.7
|
%
|
|
33.7
|
%
|
|
31.7
|
%
|
|||
Risk-free interest rate
|
|
2.82
|
|
|
1.81
|
|
|
1.32
|
|
|||
Expected dividend yield
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted average grant date fair value - stock options
|
|
$
|
105.81
|
|
|
$
|
57.81
|
|
|
$
|
31.17
|
|
Weighted average grant date fair value - restricted stock units
|
|
294.50
|
|
|
181.23
|
|
|
100.35
|
|
ESPP
|
|
2018
|
|
2017
|
|
2016
|
||||||
Expected term in years
|
|
0.5
|
|
|
0.5
|
|
|
0.5
|
|
|||
Weighted average expected volatility of the Company's underlying common stock
|
|
32.2
|
%
|
|
31.2
|
%
|
|
41.8
|
%
|
|||
Risk-free interest rate
|
|
1.79
|
|
|
0.80
|
|
|
0.45
|
|
|||
Expected dividend yield
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted average grant date fair value
|
|
$
|
62.76
|
|
|
$
|
41.70
|
|
|
$
|
29.16
|
|
|
|
Options
|
|
Weighted
Average
Exercise Price
|
|
Weighted Average Remaining Contractual Life - in Years
|
|
Aggregate Intrinsic Value of
In-The-Money Options
|
|||||
Outstanding at December 31, 2017
|
|
808,049
|
|
|
$
|
105.68
|
|
|
|
|
|
||
Granted
|
|
90,375
|
|
|
305.19
|
|
|
|
|
|
|||
Exercised
|
|
(199,659
|
)
|
|
83.74
|
|
|
|
|
|
|||
Forfeited
|
|
(16,769
|
)
|
|
171.07
|
|
|
|
|
|
|||
Expired
|
|
(2,337
|
)
|
|
60.37
|
|
|
|
|
|
|||
Outstanding at December 31, 2018
|
|
679,659
|
|
|
137.19
|
|
|
3.51
|
|
$
|
46,038,508
|
|
|
Vested and expected to vest at December 31, 2018
|
|
662,702
|
|
|
135.01
|
|
|
3.46
|
|
45,667,197
|
|
||
Exercisable at December 31, 2018
|
|
410,897
|
|
|
100.03
|
|
|
2.42
|
|
36,986,923
|
|
|
|
Outstanding Options
|
|
Exercisable Options
|
||||||||||||
Range of Exercise Prices
|
|
Shares
|
|
Weighted Average Remaining Contractual Life - in Years
|
|
Weighted Average Exercise Price
|
|
Shares
|
|
Weighted Average Exercise Price
|
||||||
$54.75 - 67.77
|
|
51,651
|
|
|
0.33
|
|
$
|
63.62
|
|
|
51,651
|
|
|
$
|
63.62
|
|
67.78 - 79.77
|
|
98,097
|
|
|
1.33
|
|
71.11
|
|
|
98,097
|
|
|
71.11
|
|
||
79.78 - 105.84
|
|
140,703
|
|
|
4.27
|
|
104.92
|
|
|
62,996
|
|
|
104.70
|
|
||
105.85 - 108.59
|
|
116,254
|
|
|
2.33
|
|
107.95
|
|
|
116,254
|
|
|
107.95
|
|
||
108.60 - 149.65
|
|
85,263
|
|
|
3.27
|
|
128.62
|
|
|
59,319
|
|
|
128.27
|
|
||
149.66 - 173.94
|
|
2,939
|
|
|
5.43
|
|
169.49
|
|
|
735
|
|
|
169.49
|
|
||
173.95 - 180.62
|
|
93,487
|
|
|
5.34
|
|
178.39
|
|
|
20,531
|
|
|
178.39
|
|
||
180.63 - 283.09
|
|
4,588
|
|
|
5.99
|
|
219.46
|
|
|
1,314
|
|
|
227.04
|
|
||
283.10 - 324.77
|
|
86,677
|
|
|
6.34
|
|
305.96
|
|
|
—
|
|
|
—
|
|
||
Total
|
|
679,659
|
|
|
3.51
|
|
137.19
|
|
|
410,897
|
|
|
100.03
|
|
|
|
Shares
|
|
Weighted Average Grant Date Fair Value
|
|||
Nonvested at December 31, 2017
|
|
637,667
|
|
|
$
|
135.86
|
|
Granted
|
|
223,918
|
|
|
294.50
|
|
|
Vested
|
|
(219,305
|
)
|
|
130.72
|
|
|
Forfeited
|
|
(44,984
|
)
|
|
172.32
|
|
|
Nonvested at December 31, 2018
|
|
597,296
|
|
|
194.48
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Total intrinsic value of stock options exercised
|
|
$
|
40,681
|
|
|
$
|
36,173
|
|
|
$
|
18,186
|
|
Total grant date fair value of stock options vested
|
|
5,823
|
|
|
6,094
|
|
|
7,364
|
|
|||
Total intrinsic value of restricted stock vested
|
|
63,917
|
|
|
40,925
|
|
|
22,966
|
|
|||
Total grant date fair value of restricted stock vested
|
|
28,813
|
|
|
23,383
|
|
|
19,454
|
|
5.
|
Variable Interest Entities
|
(Dollars in thousands)
|
|
Consolidated VIEs
|
|
Unconsolidated VIEs
|
|
Maximum Exposure to Loss in Unconsolidated VIEs
|
||||||
December 31, 2018:
|
|
|
|
|
|
|
||||||
Assets:
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
|
$
|
9,058
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-marketable and other equity securities (1)
|
|
221,646
|
|
|
568,272
|
|
|
568,272
|
|
|||
Accrued interest receivable and other assets
|
|
228
|
|
|
—
|
|
|
—
|
|
|||
Total assets
|
|
$
|
230,932
|
|
|
$
|
568,272
|
|
|
$
|
568,272
|
|
Liabilities:
|
|
|
|
|
|
|
||||||
Other liabilities (1)
|
|
919
|
|
|
205,685
|
|
|
—
|
|
|||
Total liabilities
|
|
$
|
919
|
|
|
$
|
205,685
|
|
|
$
|
—
|
|
December 31, 2017:
|
|
|
|
|
|
|
||||||
Assets:
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
|
$
|
6,674
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-marketable and other equity securities (1)
|
|
190,562
|
|
|
346,097
|
|
|
346,097
|
|
|||
Accrued interest receivable and other assets
|
|
365
|
|
|
—
|
|
|
—
|
|
|||
Total assets
|
|
$
|
197,601
|
|
|
$
|
346,097
|
|
|
$
|
346,097
|
|
Liabilities:
|
|
|
|
|
|
|
||||||
Other liabilities (1)
|
|
990
|
|
|
100,891
|
|
|
—
|
|
|||
Total liabilities
|
|
$
|
990
|
|
|
$
|
100,891
|
|
|
$
|
—
|
|
|
(1)
|
Included in our unconsolidated non-marketable and other equity securities portfolio at
December 31, 2018
and
December 31, 2017
are investments in qualified affordable housing projects of
$318.6 million
and
$174.2 million
, respectively, and related other liabilities consisting of unfunded credit commitments of
$205.7 million
and
$100.9 million
, respectively.
|
6.
|
Reserves on Deposit with the Federal Reserve Bank and Federal Bank Stock
|
|
|
Year ended December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Average required reserve balances at FRB San Francisco
|
|
$
|
455,866
|
|
|
$
|
397,235
|
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
FHLB stock holdings
|
|
$
|
17,250
|
|
|
$
|
18,900
|
|
FRB stock holdings
|
|
41,628
|
|
|
41,120
|
|
7.
|
Cash and Cash Equivalents
|
(Dollars in thousands)
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Cash and due from banks (1)
|
|
$
|
3,444,971
|
|
|
$
|
2,672,290
|
|
Securities purchased under agreements to resell (2)
|
|
123,611
|
|
|
247,876
|
|
||
Other short-term investment securities
|
|
2,957
|
|
|
2,909
|
|
||
Total cash and cash equivalents
|
|
$
|
3,571,539
|
|
|
$
|
2,923,075
|
|
|
(1)
|
At
December 31, 2018
and
2017
,
$1.7 billion
and
$0.6 billion
, respectively, of our cash and due from banks was deposited at the FRB and was earning interest at the Federal Funds target rate, and interest-earning deposits in other financial institutions were
$1.2 billion
and
$1.1 billion
, respectively.
|
(2)
|
At
December 31, 2018
and
2017
, securities purchased under agreements to resell were collateralized by U.S. Treasury securities and U.S. agency securities with aggregate fair values of
$126 million
and
$253 million
, respectively. None of these securities were sold or repledged as of
December 31, 2018
and
2017
.
|
|
|
Year ended December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Average securities purchased under agreements to resell
|
|
$
|
132,938
|
|
|
$
|
94,094
|
|
Maximum amount outstanding at any month-end during the year
|
|
375,180
|
|
|
377,073
|
|
8.
|
Investment Securities
|
|
|
December 31, 2018
|
||||||||||||||
(Dollars in thousands)
|
|
Amortized
Cost |
|
Unrealized
Gains |
|
Unrealized
Losses |
|
Carrying
Value |
||||||||
Available-for-sale securities, at fair value:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
|
$
|
4,762,182
|
|
|
$
|
11,638
|
|
|
$
|
(35,562
|
)
|
|
$
|
4,738,258
|
|
U.S. agency debentures
|
|
1,090,426
|
|
|
61
|
|
|
(6,370
|
)
|
|
1,084,117
|
|
||||
Foreign government debt securities
|
|
5,815
|
|
|
—
|
|
|
(3
|
)
|
|
5,812
|
|
||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
||||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
1,922,618
|
|
|
—
|
|
|
(42,400
|
)
|
|
1,880,218
|
|
||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
81,270
|
|
|
383
|
|
|
(15
|
)
|
|
81,638
|
|
||||
Total available-for-sale securities
|
|
$
|
7,862,311
|
|
|
$
|
12,082
|
|
|
$
|
(84,350
|
)
|
|
$
|
7,790,043
|
|
|
|
December 31, 2017
|
||||||||||||||
(Dollars in thousands)
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Carrying
Value
|
||||||||
Available-for-sale securities, at fair value:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
|
$
|
6,865,068
|
|
|
$
|
1,113
|
|
|
$
|
(25,679
|
)
|
|
$
|
6,840,502
|
|
U.S. agency debentures
|
|
1,569,195
|
|
|
3,569
|
|
|
(5,636
|
)
|
|
1,567,128
|
|
||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
||||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
2,292,311
|
|
|
258
|
|
|
(25,534
|
)
|
|
2,267,035
|
|
||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
372,481
|
|
|
1,375
|
|
|
(126
|
)
|
|
373,730
|
|
||||
Equity securities
|
|
31,953
|
|
|
40,525
|
|
|
(209
|
)
|
|
72,269
|
|
||||
Total available-for-sale securities
|
|
$
|
11,131,008
|
|
|
$
|
46,840
|
|
|
$
|
(57,184
|
)
|
|
$
|
11,120,664
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Sales proceeds
|
|
$
|
474,482
|
|
|
$
|
580,871
|
|
|
$
|
2,892,460
|
|
Net realized gains and losses:
|
|
|
|
|
|
|
||||||
Gross realized gains
|
|
127
|
|
|
5,113
|
|
|
15,051
|
|
|||
Gross realized losses
|
|
(867
|
)
|
|
(10,302
|
)
|
|
(2,856
|
)
|
|||
Net realized (losses) gains
|
|
$
|
(740
|
)
|
|
$
|
(5,189
|
)
|
|
$
|
12,195
|
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
Less than 12 months
|
|
12 months or longer (1)
|
|
Total
|
||||||||||||||||||
(Dollars in thousands)
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury securities
|
|
$
|
494,287
|
|
|
$
|
(3,785
|
)
|
|
$
|
3,568,119
|
|
|
$
|
(31,777
|
)
|
|
$
|
4,062,406
|
|
|
$
|
(35,562
|
)
|
U.S. agency debentures
|
|
443,790
|
|
|
(1,602
|
)
|
|
591,216
|
|
|
(4,768
|
)
|
|
1,035,006
|
|
|
(6,370
|
)
|
||||||
Foreign government debt securities
|
|
5,812
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
5,812
|
|
|
(3
|
)
|
||||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
13,430
|
|
|
(22
|
)
|
|
1,866,788
|
|
|
(42,378
|
)
|
|
1,880,218
|
|
|
(42,400
|
)
|
||||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
—
|
|
|
—
|
|
|
13,516
|
|
|
(15
|
)
|
|
13,516
|
|
|
(15
|
)
|
||||||
Total temporarily impaired securities (1)
|
|
$
|
957,319
|
|
|
$
|
(5,412
|
)
|
|
$
|
6,039,639
|
|
|
$
|
(78,938
|
)
|
|
$
|
6,996,958
|
|
|
$
|
(84,350
|
)
|
|
(1)
|
As of
December 31, 2018
, we identified a total of
200
investments that were in unrealized loss positions, of which
162
investments totaling
$6.0 billion
with unrealized losses of
$78.9 million
have been in an impaired position for a period of time greater than 12 months. As of
December 31, 2018
, we do not intend to sell any of our impaired securities prior to recovery of our adjusted cost basis, and it is more likely than not that we will not be required to sell any of our securities prior to recovery of our adjusted cost basis. Based on our analysis as of
December 31, 2018
, we deem all impairments to be temporary, and therefore changes in value for our temporarily impaired securities as of the same date are included in other comprehensive income. Market valuations and impairment analyses on assets in the AFS securities portfolio are reviewed and monitored on a quarterly basis.
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
Less than 12 months
|
|
12 months or longer (1)
|
|
Total
|
||||||||||||||||||
(Dollars in thousands)
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury securities
|
|
$
|
5,968,914
|
|
|
$
|
(23,397
|
)
|
|
$
|
323,966
|
|
|
$
|
(2,282
|
)
|
|
$
|
6,292,880
|
|
|
$
|
(25,679
|
)
|
U.S. agency debentures
|
|
736,541
|
|
|
(2,289
|
)
|
|
336,196
|
|
|
(3,347
|
)
|
|
1,072,737
|
|
|
(5,636
|
)
|
||||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
2,193,277
|
|
|
(25,534
|
)
|
|
—
|
|
|
—
|
|
|
2,193,277
|
|
|
(25,534
|
)
|
||||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
13,843
|
|
|
(3
|
)
|
|
53,186
|
|
|
(123
|
)
|
|
67,029
|
|
|
(126
|
)
|
||||||
Equity securities
|
|
624
|
|
|
(209
|
)
|
|
—
|
|
|
—
|
|
|
624
|
|
|
(209
|
)
|
||||||
Total temporarily impaired securities (1)
|
|
$
|
8,913,199
|
|
|
$
|
(51,432
|
)
|
|
$
|
713,348
|
|
|
$
|
(5,752
|
)
|
|
$
|
9,626,547
|
|
|
$
|
(57,184
|
)
|
|
(1)
|
As of
December 31, 2017
, we identified a total of
268
investments that were in unrealized loss positions, of which
46
investments totaling
$713.3 million
with unrealized losses of
$5.8 million
have been in an impaired position for a period of time greater than 12 months.
|
|
|
December 31, 2018
|
||||||||||||||||||
(Dollars in thousands)
|
|
Total
|
|
One Year
or Less |
|
After One
Year to Five Years |
|
After Five
Years to Ten Years |
|
After
Ten Years |
||||||||||
U.S. Treasury securities
|
|
$
|
4,738,258
|
|
|
$
|
1,765,333
|
|
|
$
|
2,524,484
|
|
|
$
|
448,441
|
|
|
$
|
—
|
|
U.S. agency debentures
|
|
1,084,117
|
|
|
665,750
|
|
|
418,367
|
|
|
—
|
|
|
—
|
|
|||||
Foreign government debt securities
|
|
5,812
|
|
|
—
|
|
|
5,812
|
|
|
—
|
|
|
—
|
|
|||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
1,880,218
|
|
|
—
|
|
|
—
|
|
|
16,030
|
|
|
1,864,188
|
|
|||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
81,638
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81,638
|
|
|||||
Total
|
|
$
|
7,790,043
|
|
|
$
|
2,431,083
|
|
|
$
|
2,948,663
|
|
|
$
|
464,471
|
|
|
$
|
1,945,826
|
|
|
|
December 31, 2018
|
||||||||||||||
(Dollars in thousands)
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value
|
||||||||
Held-to-maturity securities, at cost:
|
|
|
|
|
|
|
|
|
||||||||
U.S. agency debentures (1)
|
|
$
|
640,990
|
|
|
$
|
2,148
|
|
|
$
|
(4,850
|
)
|
|
$
|
638,288
|
|
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
||||||||
Agency-issued mortgage-backed securities
|
|
8,103,638
|
|
|
5,011
|
|
|
(157,767
|
)
|
|
7,950,882
|
|
||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
2,183,204
|
|
|
—
|
|
|
(62,272
|
)
|
|
2,120,932
|
|
||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
214,483
|
|
|
608
|
|
|
(14
|
)
|
|
215,077
|
|
||||
Agency-issued commercial mortgage-backed securities
|
|
2,769,706
|
|
|
6,969
|
|
|
(64,374
|
)
|
|
2,712,301
|
|
||||
Municipal bonds and notes
|
|
1,575,421
|
|
|
2,304
|
|
|
(26,969
|
)
|
|
1,550,756
|
|
||||
Total held-to-maturity securities
|
|
$
|
15,487,442
|
|
|
$
|
17,040
|
|
|
$
|
(316,246
|
)
|
|
$
|
15,188,236
|
|
|
(1)
|
Consists of pools of Small Business Investment Company debentures issued and guaranteed by the U.S. Small Business Administration, an independent agency of the United States.
|
|
|
December 31, 2017
|
||||||||||||||
(Dollars in thousands)
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair Value
|
||||||||
Held-to-maturity securities, at cost:
|
|
|
|
|
|
|
|
|
||||||||
U.S. agency debentures (1)
|
|
$
|
659,979
|
|
|
$
|
3,167
|
|
|
$
|
(1,601
|
)
|
|
$
|
661,545
|
|
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
||||||||
Agency-issued mortgage-backed securities
|
|
6,304,969
|
|
|
4,854
|
|
|
(43,528
|
)
|
|
6,266,295
|
|
||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
2,829,979
|
|
|
23
|
|
|
(54,372
|
)
|
|
2,775,630
|
|
||||
Agency-issued collateralized mortgage obligations—variable rate
|
|
255,782
|
|
|
733
|
|
|
(34
|
)
|
|
256,481
|
|
||||
Agency-issued commercial mortgage-backed securities
|
|
1,868,985
|
|
|
694
|
|
|
(25,563
|
)
|
|
1,844,116
|
|
||||
Municipal bonds and notes
|
|
743,761
|
|
|
3,452
|
|
|
(3,000
|
)
|
|
744,213
|
|
||||
Total held-to-maturity securities
|
|
$
|
12,663,455
|
|
|
$
|
12,923
|
|
|
$
|
(128,098
|
)
|
|
$
|
12,548,280
|
|
|
(1)
|
Consists of pools of Small Business Investment Company debentures issued and guaranteed by the U.S. Small Business Administration, an independent agency of the United States.
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
Less than 12 months
|
|
12 months or longer (1)
|
|
Total
|
||||||||||||||||||
(Dollars in thousands)
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
|
Fair Value of
Investments
|
|
Unrealized
Losses
|
||||||||||||
Held-to-maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. agency debentures
|
|
$
|
291,432
|
|
|
$
|
(2,915
|
)
|
|
$
|
66,624
|
|
|
$
|
(1,935
|
)
|
|
$
|
358,056
|
|
|
$
|
(4,850
|
)
|
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency-issued mortgage-backed securities
|
|
2,493,156
|
|
|
(34,956
|
)
|
|
3,972,690
|
|
|
(122,811
|
)
|
|
6,465,846
|
|
|
(157,767
|
)
|
||||||
Agency-issued collateralized mortgage
obligations—fixed rate
|
|
16,952
|
|
|
(109
|
)
|
|
2,103,980
|
|
|
(62,163
|
)
|
|
2,120,932
|
|
|
(62,272
|
)
|
||||||
Agency-issued collateralized mortgage
obligations—variable rate
|
|
3,364
|
|
|
(1
|
)
|
|
8,101
|
|
|
(13
|
)
|
|
11,465
|
|
|
(14
|
)
|
||||||
Agency-issued commercial mortgage-backed
securities
|
|
177,697
|
|
|
(1,580
|
)
|
|
1,600,277
|
|
|
(62,794
|
)
|
|
1,777,974
|
|
|
(64,374
|
)
|
||||||
Municipal bonds and notes
|
|
868,751
|
|
|
(17,075
|
)
|
|
340,413
|
|
|
(9,894
|
)
|
|
1,209,164
|
|
|
(26,969
|
)
|
||||||
Total temporarily impaired securities (1)
|
|
$
|
3,851,352
|
|
|
$
|
(56,636
|
)
|
|
$
|
8,092,085
|
|
|
$
|
(259,610
|
)
|
|
$
|
11,943,437
|
|
|
$
|
(316,246
|
)
|
|
(1)
|
As of
December 31, 2018
, we identified a total of
1244
investments that were in unrealized loss positions, of which
695
investments totaling
$8.1 billion
with unrealized losses of
$259.6 million
have been in an impaired position for a period of time greater than 12 months. As of
December 31, 2018
, we do not intend to sell any of our impaired securities prior to recovery of our adjusted cost basis, and it is more likely than not that we will not be required to sell any of our securities prior to recovery of our adjusted cost basis, which is consistent with our classification of these securities. Based on our analysis as of
December 31, 2018
, we deem all impairments to be temporary. Market valuations and impairment analyses on assets in the HTM securities portfolio are reviewed and monitored on a quarterly basis.
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
Less than 12 months
|
|
12 months or longer (1)
|
|
Total
|
||||||||||||||||||
(Dollars in thousands)
|
|
Fair Value of
Investments |
|
Unrealized
Losses |
|
Fair Value of
Investments |
|
Unrealized
Losses |
|
Fair Value of
Investments |
|
Unrealized
Losses |
||||||||||||
Held-to-maturity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. agency debentures
|
|
$
|
104,688
|
|
|
$
|
(1,601
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
104,688
|
|
|
$
|
(1,601
|
)
|
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Agency-issued mortgage-backed securities
|
|
4,270,377
|
|
|
(34,092
|
)
|
|
408,913
|
|
|
(9,436
|
)
|
|
4,679,290
|
|
|
(43,528
|
)
|
||||||
Agency-issued collateralized mortgage obligations—fixed rate
|
|
1,011,709
|
|
|
(13,631
|
)
|
|
1,741,614
|
|
|
(40,741
|
)
|
|
2,753,323
|
|
|
(54,372
|
)
|
||||||
Agency-issued collateralized mortgage
obligations—variable rate
|
|
—
|
|
|
—
|
|
|
9,812
|
|
|
(34
|
)
|
|
9,812
|
|
|
(34
|
)
|
||||||
Agency-issued commercial mortgage-backed securities
|
|
979,361
|
|
|
(11,566
|
)
|
|
773,712
|
|
|
(13,997
|
)
|
|
1,753,073
|
|
|
(25,563
|
)
|
||||||
Municipal bonds and notes
|
|
344,796
|
|
|
(2,103
|
)
|
|
32,844
|
|
|
(897
|
)
|
|
377,640
|
|
|
(3,000
|
)
|
||||||
Total temporarily impaired securities (1)
|
|
$
|
6,710,931
|
|
|
$
|
(62,993
|
)
|
|
$
|
2,966,895
|
|
|
$
|
(65,105
|
)
|
|
$
|
9,677,826
|
|
|
$
|
(128,098
|
)
|
|
(1)
|
As of
December 31, 2017
, we identified a total of
753
investments that were in unrealized loss positions, of which
237
investments totaling
$3.0 billion
with unrealized losses of
$65.1 million
have been in an impaired position for a period of time greater than 12 months.
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||||||||||
|
|
Total
|
|
One Year
or Less
|
|
After One Year to
Five Years
|
|
After Five Years to
Ten Years
|
|
After
Ten Years
|
||||||||||||||||||||||||||||||
(Dollars in thousands)
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
||||||||||||||||||||
U.S. agency debentures
|
|
$
|
640,990
|
|
|
$
|
638,288
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
104,550
|
|
|
$
|
104,105
|
|
|
$
|
536,440
|
|
|
$
|
534,183
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Agency-issued mortgage-backed securities
|
|
8,103,638
|
|
|
7,950,883
|
|
|
—
|
|
|
—
|
|
|
155,257
|
|
|
152,524
|
|
|
885,622
|
|
|
859,609
|
|
|
7,062,759
|
|
|
6,938,750
|
|
||||||||||
Agency-issued collateralized mortgage obligations - fixed rate
|
|
2,183,204
|
|
|
2,120,932
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
483,043
|
|
|
466,458
|
|
|
1,700,161
|
|
|
1,654,474
|
|
||||||||||
Agency-issued collateralized mortgage obligations - variable rate
|
|
214,483
|
|
|
215,077
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
214,483
|
|
|
215,077
|
|
||||||||||
Agency-issued commercial mortgage-backed securities
|
|
2,769,706
|
|
|
2,712,301
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,769,706
|
|
|
2,712,301
|
|
||||||||||
Municipal bonds and notes
|
|
1,575,421
|
|
|
1,550,755
|
|
|
9,725
|
|
|
9,720
|
|
|
75,379
|
|
|
74,670
|
|
|
307,184
|
|
|
300,766
|
|
|
1,183,133
|
|
|
1,165,599
|
|
||||||||||
Total
|
|
$
|
15,487,442
|
|
|
$
|
15,188,236
|
|
|
$
|
9,725
|
|
|
$
|
9,720
|
|
|
$
|
335,186
|
|
|
$
|
331,299
|
|
|
$
|
2,212,289
|
|
|
$
|
2,161,016
|
|
|
$
|
12,930,242
|
|
|
$
|
12,686,201
|
|
(Dollars in thousands)
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Non-marketable and other equity securities:
|
|
|
|
|
||||
Non-marketable securities (fair value accounting):
|
|
|
|
|
||||
Consolidated venture capital and private equity fund investments (1)
|
|
$
|
118,333
|
|
|
$
|
128,111
|
|
Unconsolidated venture capital and private equity fund investments (2)
|
|
201,098
|
|
|
98,548
|
|
||
Other investments without a readily determinable fair value (3)
|
|
25,668
|
|
|
27,680
|
|
||
Other equity securities in public companies (fair value accounting) (4)
|
|
20,398
|
|
|
310
|
|
||
Non-marketable securities (equity method accounting) (5):
|
|
|
|
|
||||
Venture capital and private equity fund investments
|
|
129,485
|
|
|
89,809
|
|
||
Debt funds
|
|
5,826
|
|
|
21,183
|
|
||
Other investments
|
|
121,721
|
|
|
111,198
|
|
||
Investments in qualified affordable housing projects, net (6)
|
|
318,575
|
|
|
174,214
|
|
||
Total non-marketable and other equity securities
|
|
$
|
941,104
|
|
|
$
|
651,053
|
|
|
(1)
|
The following table shows the amounts of venture capital and private equity fund investments held by the following consolidated funds and our ownership percentage of each fund at
December 31, 2018
and
2017
(fair value accounting):
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Ownership %
|
|
Amount
|
|
Ownership %
|
||||||
Strategic Investors Fund, LP
|
|
$
|
12,452
|
|
|
12.6
|
%
|
|
$
|
14,673
|
|
|
12.6
|
%
|
Capital Preferred Return Fund, LP
|
|
53,957
|
|
|
20.0
|
|
|
54,147
|
|
|
20.0
|
|
||
Growth Partners, LP
|
|
50,845
|
|
|
33.0
|
|
|
58,372
|
|
|
33.0
|
|
||
CP I, LP
|
|
1,079
|
|
|
10.7
|
|
|
919
|
|
|
10.7
|
|
||
Total consolidated venture capital and private equity fund investments
|
|
$
|
118,333
|
|
|
|
|
$
|
128,111
|
|
|
|
(2)
|
The carrying value represents investments in
213
and
235
funds (primarily venture capital funds) at
December 31, 2018
and
December 31, 2017
, respectively, where our ownership interest is typically less than
5%
of the voting interests of each such fund and in which we do not have the ability to exercise significant influence over the partnerships operating activities and financial policies. Effective January 1, 2018, we adopted ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities which eliminated the concept of cost method accounting. On a prospective basis, we will carry our unconsolidated venture capital and private equity fund investments at fair value based on the fund investments' net asset values per share as obtained from the general partners of the investments. For each fund investment, we adjust the net asset value per share for differences between our measurement date and the date of the fund investment’s net asset value by using the most recently available financial information from the investee general partner, for example September 30
th
for our December 31
st
consolidated financial statements, adjusted for any contributions paid, distributions received from the investment, and significant fund transactions or market events during the reporting period. We recorded a cumulative adjustment to opening retained earnings on January 1, 2018 for the difference between fair value and cost for these fund investments. The estimated fair value and carrying value of these venture capital and private equity fund investments was
$201.1 million
as of
December 31, 2018
. As of December 31, 2017, these investments were carried at cost and had a carrying value of
$98.5 million
.
|
(3)
|
Effective January 1, 2018, we adopted ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities which eliminated the concept of cost method accounting. On a prospective basis, we have elected the measurement alternative and will report our other investments in the line item "Other investments without a readily determinable fair value". These investments include direct equity investments in private companies. The carrying value is based on the price at which the investment was acquired plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments. We consider a range of factors when adjusting the fair value of
|
(Dollars in thousands)
|
|
Year ended December 31, 2018
|
|
Cumulative Adjustments
|
||||
Measurement alternative:
|
|
|
|
|
||||
Carrying value at December 31, 2018
|
|
$
|
25,668
|
|
|
|
||
Carrying value adjustments:
|
|
|
|
|
||||
Impairment
|
|
$
|
—
|
|
|
$
|
—
|
|
Downward changes for observable prices
|
|
1,963
|
|
|
1,963
|
|
||
Upward changes for observable prices
|
|
1,711
|
|
|
1,711
|
|
(4)
|
Investments classified as other equity securities (fair value accounting) represent shares held in public companies as a result of exercising public equity warrant assets and direct equity investments in public companies held by our consolidated funds. Effective January 1, 2018, we adopted ASU 2016-01, which requires equity securities to be measured at fair value with changes in the fair value recognized through net income. Prior to January 1, 2018 we reported equity securities in public companies that we held as a result of exercising public equity warrant assets in available-for-sale securities. On a prospective basis, these equity securities will be reported in non-marketable and other equity securities.
|
(5)
|
The following table shows the carrying value and our ownership percentage of each investment at
December 31, 2018
and
2017
(equity method accounting):
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Ownership %
|
|
Amount
|
|
Ownership %
|
||||||
Venture capital and private equity fund investments:
|
|
|
|
|
|
|
|
|
||||||
Strategic Investors Fund II, LP
|
|
$
|
4,670
|
|
|
8.6
|
%
|
|
$
|
6,342
|
|
|
8.6
|
%
|
Strategic Investors Fund III, LP
|
|
17,396
|
|
|
5.9
|
|
|
18,758
|
|
|
5.9
|
|
||
Strategic Investors Fund IV, LP
|
|
28,974
|
|
|
5.0
|
|
|
25,551
|
|
|
5.0
|
|
||
Strategic Investors Fund V funds
|
|
28,189
|
|
|
Various
|
|
|
16,856
|
|
|
Various
|
|
||
CP II, LP (i)
|
|
7,122
|
|
|
5.1
|
|
|
6,700
|
|
|
5.1
|
|
||
Other venture capital and private equity fund investments
|
|
43,134
|
|
|
Various
|
|
|
15,602
|
|
|
Various
|
|
||
Total venture capital and private equity fund investments
|
|
$
|
129,485
|
|
|
|
|
|
$
|
89,809
|
|
|
|
|
Debt funds:
|
|
|
|
|
|
|
|
|
||||||
Gold Hill Capital 2008, LP (ii)
|
|
$
|
3,901
|
|
|
15.5
|
%
|
|
$
|
18,690
|
|
|
15.5
|
%
|
Other debt funds
|
|
1,925
|
|
|
Various
|
|
|
2,493
|
|
|
Various
|
|
||
Total debt funds
|
|
$
|
5,826
|
|
|
|
|
$
|
21,183
|
|
|
|
||
Other investments:
|
|
|
|
|
|
|
|
|
||||||
SPD Silicon Valley Bank Co., Ltd.
|
|
$
|
76,412
|
|
|
50.0
|
%
|
|
$
|
75,337
|
|
|
50.0
|
%
|
Other investments
|
|
45,309
|
|
|
Various
|
|
|
35,861
|
|
|
Various
|
|
||
Total other investments
|
|
$
|
121,721
|
|
|
|
|
$
|
111,198
|
|
|
|
|
(i)
|
Our ownership includes direct ownership interest of
1.3 percent
and indirect ownership interest of
3.8 percent
through our investments in Strategic Investors Fund II, LP.
|
(ii)
|
Our ownership includes direct ownership interest of
11.5 percent
in the fund and an indirect interest in the fund through our investment in Gold Hill Capital 2008, LLC of
4.0 percent
.
|
(6)
|
The following table presents the balances of our investments in qualified affordable housing projects and related unfunded commitments included as a component of "other liabilities" on our consolidated balance sheets at
December 31, 2018
and
2017
:
|
(Dollars in thousands)
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Investments in qualified affordable housing projects, net
|
|
$
|
318,575
|
|
|
$
|
174,214
|
|
Other liabilities
|
|
205,685
|
|
|
100,891
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Tax credits and other tax benefits recognized
|
|
$
|
24,047
|
|
|
$
|
17,296
|
|
|
$
|
15,404
|
|
Amortization expense included in provision for income taxes (i)
|
|
18,876
|
|
|
17,362
|
|
|
12,145
|
|
|
(i)
|
All investments are amortized using the proportional amortization method and amortization expense is included in the provision for income taxes. Included in amortization expense for the year ended December 31, 2017 is a one-time cumulative effect adjustment of
$3.8 million
due to the decrease in value of deductions in the 2018 tax year and going forward, due to the TCJ Act federal corporate income tax rate reduction.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net gains (losses) on non-marketable and other equity securities:
|
|
|
|
|
|
|
||||||
Non-marketable securities (fair value accounting):
|
|
|
|
|
|
|
||||||
Consolidated venture capital and private equity fund investments
|
|
$
|
20,999
|
|
|
$
|
27,186
|
|
|
$
|
5,964
|
|
Unconsolidated venture capital and private equity fund investments (1)
|
|
39,075
|
|
|
21,377
|
|
|
17,816
|
|
|||
Other investments without a readily determinable fair value (1)
|
|
3,206
|
|
|
3,842
|
|
|
(45
|
)
|
|||
Other equity securities in public companies (fair value accounting) (1)
|
|
(25,483
|
)
|
|
241
|
|
|
(90
|
)
|
|||
Non-marketable securities (equity method accounting):
|
|
|
|
|
|
|
||||||
Venture capital and private equity fund investments
|
|
49,341
|
|
|
14,472
|
|
|
4,070
|
|
|||
Debt funds
|
|
541
|
|
|
8,950
|
|
|
948
|
|
|||
Other investments
|
|
1,155
|
|
|
(6,276
|
)
|
|
10,882
|
|
|||
Total net gains on non-marketable and other equity securities
|
|
$
|
88,834
|
|
|
$
|
69,792
|
|
|
$
|
39,545
|
|
Less: Realized net losses on the sales and OTTI of non-marketable and other equity securities (2)
|
|
(26,097
|
)
|
|
(355
|
)
|
|
(4,524
|
)
|
|||
Net gains on non-marketable and other equity securities still held
|
|
$
|
114,931
|
|
|
$
|
70,147
|
|
|
$
|
44,069
|
|
|
(1)
|
Prior period amounts are not determined in a manner consistent with the current period presentation due to the adoption of ASU 2016-01.
|
(2)
|
Realized gains and losses include sales and OTTI of non-marketable and other equity securities. Includes losses of
$20.8 million
in losses on sales and
$5.3 million
of OTTI for the period ended December 31, 2018. Includes gains of
$3.8 million
|
9.
|
Loans, Allowance for Loan Losses and Allowance for Unfunded Credit Commitments
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Commercial loans:
|
|
|
|
|
||||
Software/internet
|
|
$
|
6,154,755
|
|
|
$
|
6,172,531
|
|
Hardware
|
|
1,234,557
|
|
|
1,193,599
|
|
||
Private equity/venture capital
|
|
14,110,560
|
|
|
9,952,377
|
|
||
Life science/healthcare
|
|
2,385,612
|
|
|
1,808,827
|
|
||
Premium wine
|
|
249,266
|
|
|
204,105
|
|
||
Other
|
|
321,978
|
|
|
365,724
|
|
||
Total commercial loans
|
|
24,456,728
|
|
|
19,697,163
|
|
||
Real estate secured loans:
|
|
|
|
|
||||
Premium wine (1)
|
|
710,397
|
|
|
669,053
|
|
||
Consumer loans (2)
|
|
2,612,971
|
|
|
2,300,506
|
|
||
Other
|
|
40,435
|
|
|
42,068
|
|
||
Total real estate secured loans
|
|
3,363,803
|
|
|
3,011,627
|
|
||
Construction loans
|
|
97,077
|
|
|
68,546
|
|
||
Consumer loans
|
|
420,672
|
|
|
328,980
|
|
||
Total loans, net of unearned income (3)
|
|
$
|
28,338,280
|
|
|
$
|
23,106,316
|
|
|
(1)
|
Included in our premium wine portfolio are gross construction loans of
$99 million
and
$100 million
at
December 31, 2018
and
2017
, respectively.
|
(2)
|
Consumer loans secured by real estate at
December 31, 2018
and
2017
were comprised of the following:
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Loans for personal residence
|
|
$
|
2,251,292
|
|
|
$
|
1,995,840
|
|
Loans to eligible employees
|
|
290,194
|
|
|
243,118
|
|
||
Home equity lines of credit
|
|
71,485
|
|
|
61,548
|
|
||
Consumer loans secured by real estate
|
|
$
|
2,612,971
|
|
|
$
|
2,300,506
|
|
(3)
|
Included within our total loan portfolio are credit card loans of
$335 million
and
$270 million
at
December 31, 2018
and
2017
, respectively.
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Commercial loans:
|
|
|
|
|
||||
Software/internet
|
|
$
|
6,154,755
|
|
|
$
|
6,172,531
|
|
Hardware
|
|
1,234,557
|
|
|
1,193,599
|
|
||
Private equity/venture capital
|
|
14,110,560
|
|
|
9,952,377
|
|
||
Life science/healthcare
|
|
2,385,612
|
|
|
1,808,827
|
|
||
Premium wine
|
|
959,663
|
|
|
873,158
|
|
||
Other
|
|
459,490
|
|
|
476,338
|
|
||
Total commercial loans
|
|
25,304,637
|
|
|
20,476,830
|
|
||
Consumer loans:
|
|
|
|
|
||||
Real estate secured loans
|
|
2,612,971
|
|
|
2,300,506
|
|
||
Other consumer loans
|
|
420,672
|
|
|
328,980
|
|
||
Total consumer loans
|
|
3,033,643
|
|
|
2,629,486
|
|
||
Total loans, net of unearned income
|
|
$
|
28,338,280
|
|
|
$
|
23,106,316
|
|
(Dollars in thousands)
|
|
30 - 59
Days Past
Due
|
|
60 - 89
Days Past
Due
|
|
Equal to or Greater Than 90 Days Past Due
|
|
Total Past
Due
|
|
Current
|
|
Loans Past Due 90 Days or More Still Accruing Interest
|
||||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
28,134
|
|
|
$
|
6,944
|
|
|
$
|
378
|
|
|
$
|
35,456
|
|
|
$
|
6,059,672
|
|
|
$
|
378
|
|
Hardware
|
|
300
|
|
|
34
|
|
|
4
|
|
|
338
|
|
|
1,233,956
|
|
|
4
|
|
||||||
Private equity/venture capital
|
|
59,481
|
|
|
11
|
|
|
—
|
|
|
59,492
|
|
|
14,054,940
|
|
|
—
|
|
||||||
Life science/healthcare
|
|
16,082
|
|
|
817
|
|
|
19
|
|
|
16,918
|
|
|
2,410,091
|
|
|
19
|
|
||||||
Premium wine
|
|
2,953
|
|
|
14
|
|
|
—
|
|
|
2,967
|
|
|
956,285
|
|
|
—
|
|
||||||
Other
|
|
7,391
|
|
|
163
|
|
|
1
|
|
|
7,555
|
|
|
477,442
|
|
|
1
|
|
||||||
Total commercial loans
|
|
114,341
|
|
|
7,983
|
|
|
402
|
|
|
122,726
|
|
|
25,192,386
|
|
|
402
|
|
||||||
Consumer loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Real estate secured loans
|
|
3,598
|
|
|
1,750
|
|
|
1,562
|
|
|
6,910
|
|
|
2,598,496
|
|
|
1,562
|
|
||||||
Other consumer loans
|
|
361
|
|
|
—
|
|
|
—
|
|
|
361
|
|
|
420,359
|
|
|
—
|
|
||||||
Total consumer loans
|
|
3,959
|
|
|
1,750
|
|
|
1,562
|
|
|
7,271
|
|
|
3,018,855
|
|
|
1,562
|
|
||||||
Total gross loans excluding impaired loans
|
|
118,300
|
|
|
9,733
|
|
|
1,964
|
|
|
129,997
|
|
|
28,211,241
|
|
|
1,964
|
|
||||||
Impaired loans
|
|
2,843
|
|
|
1,181
|
|
|
25,092
|
|
|
29,116
|
|
|
140,958
|
|
|
—
|
|
||||||
Total gross loans
|
|
$
|
121,143
|
|
|
$
|
10,914
|
|
|
$
|
27,056
|
|
|
$
|
159,113
|
|
|
$
|
28,352,199
|
|
|
$
|
1,964
|
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
14,257
|
|
|
$
|
6,526
|
|
|
$
|
141
|
|
|
$
|
20,924
|
|
|
$
|
6,101,147
|
|
|
$
|
141
|
|
Hardware
|
|
1,145
|
|
|
77
|
|
|
50
|
|
|
1,272
|
|
|
1,163,278
|
|
|
50
|
|
||||||
Private equity/venture capital
|
|
86,566
|
|
|
38,580
|
|
|
—
|
|
|
125,146
|
|
|
9,835,317
|
|
|
—
|
|
||||||
Life science/healthcare
|
|
4,390
|
|
|
191
|
|
|
—
|
|
|
4,581
|
|
|
1,841,692
|
|
|
—
|
|
||||||
Premium wine
|
|
418
|
|
|
—
|
|
|
—
|
|
|
418
|
|
|
871,074
|
|
|
—
|
|
||||||
Other
|
|
445
|
|
|
—
|
|
|
—
|
|
|
445
|
|
|
490,292
|
|
|
—
|
|
||||||
Total commercial loans
|
|
107,221
|
|
|
45,374
|
|
|
191
|
|
|
152,786
|
|
|
20,302,800
|
|
|
191
|
|
||||||
Consumer loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Real estate secured loans
|
|
2,164
|
|
|
532
|
|
|
—
|
|
|
2,696
|
|
|
2,292,980
|
|
|
—
|
|
||||||
Other consumer loans
|
|
796
|
|
|
—
|
|
|
—
|
|
|
796
|
|
|
327,234
|
|
|
—
|
|
||||||
Total consumer loans
|
|
2,960
|
|
|
532
|
|
|
—
|
|
|
3,492
|
|
|
2,620,214
|
|
|
—
|
|
||||||
Total gross loans excluding impaired loans
|
|
110,181
|
|
|
45,906
|
|
|
191
|
|
|
156,278
|
|
|
22,923,014
|
|
|
191
|
|
||||||
Impaired loans
|
|
1,344
|
|
|
11,902
|
|
|
30,403
|
|
|
43,649
|
|
|
131,212
|
|
|
—
|
|
||||||
Total gross loans
|
|
$
|
111,525
|
|
|
$
|
57,808
|
|
|
$
|
30,594
|
|
|
$
|
199,927
|
|
|
$
|
23,054,226
|
|
|
$
|
191
|
|
(Dollars in thousands)
|
|
Impaired loans for
which there is a related allowance for loan losses
|
|
Impaired loans for
which there is no related allowance for loan losses
|
|
Total carrying value of impaired loans
|
|
Total unpaid principal of impaired loans
|
||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
||||||||
Software/internet
|
|
$
|
49,625
|
|
|
$
|
65,225
|
|
|
$
|
114,850
|
|
|
$
|
131,858
|
|
Hardware
|
|
1,256
|
|
|
10,250
|
|
|
11,506
|
|
|
12,159
|
|
||||
Private equity/venture capital
|
|
—
|
|
|
3,700
|
|
|
3,700
|
|
|
3,700
|
|
||||
Life science/healthcare
|
|
17,791
|
|
|
16,276
|
|
|
34,067
|
|
|
44,446
|
|
||||
Premium wine
|
|
—
|
|
|
1,301
|
|
|
1,301
|
|
|
1,365
|
|
||||
Other
|
|
411
|
|
|
—
|
|
|
411
|
|
|
411
|
|
||||
Total commercial loans
|
|
69,083
|
|
|
96,752
|
|
|
165,835
|
|
|
193,939
|
|
||||
Consumer loans:
|
|
|
|
|
|
|
|
|
||||||||
Real estate secured loans
|
|
3,919
|
|
|
320
|
|
|
4,239
|
|
|
5,969
|
|
||||
Other consumer loans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total consumer loans
|
|
3,919
|
|
|
320
|
|
|
4,239
|
|
|
5,969
|
|
||||
Total
|
|
$
|
73,002
|
|
|
$
|
97,072
|
|
|
$
|
170,074
|
|
|
$
|
199,908
|
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
||||||||
Software/internet
|
|
$
|
49,645
|
|
|
$
|
61,009
|
|
|
$
|
110,654
|
|
|
$
|
129,006
|
|
Hardware
|
|
15,637
|
|
|
20,713
|
|
|
36,350
|
|
|
41,721
|
|
||||
Private equity/venture capital
|
|
658
|
|
|
—
|
|
|
658
|
|
|
984
|
|
||||
Life science/healthcare
|
|
20,521
|
|
|
1,166
|
|
|
21,687
|
|
|
26,360
|
|
||||
Premium wine
|
|
—
|
|
|
2,877
|
|
|
2,877
|
|
|
2,911
|
|
||||
Other
|
|
32
|
|
|
—
|
|
|
32
|
|
|
165
|
|
||||
Total commercial loans
|
|
86,493
|
|
|
85,765
|
|
|
172,258
|
|
|
201,147
|
|
||||
Consumer loans:
|
|
|
|
|
|
|
|
|
||||||||
Real estate secured loans
|
|
1,331
|
|
|
850
|
|
|
2,181
|
|
|
3,712
|
|
||||
Other consumer loans
|
|
422
|
|
|
—
|
|
|
422
|
|
|
436
|
|
||||
Total consumer loans
|
|
1,753
|
|
|
850
|
|
|
2,603
|
|
|
4,148
|
|
||||
Total
|
|
$
|
88,246
|
|
|
$
|
86,615
|
|
|
$
|
174,861
|
|
|
$
|
205,295
|
|
Year ended December 31,
(Dollars in thousands)
|
|
Average impaired loans
|
|
Interest income recognized on impaired loans
|
||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
112,493
|
|
|
$
|
119,557
|
|
|
$
|
89,462
|
|
|
$
|
1,513
|
|
|
$
|
2,263
|
|
|
$
|
1,054
|
|
Hardware
|
|
28,540
|
|
|
35,022
|
|
|
39,108
|
|
|
312
|
|
|
1,061
|
|
|
2,624
|
|
||||||
Private equity/venture capital
|
|
1,327
|
|
|
556
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Life science/healthcare
|
|
30,144
|
|
|
30,842
|
|
|
40,620
|
|
|
756
|
|
|
90
|
|
|
155
|
|
||||||
Premium wine
|
|
2,605
|
|
|
3,249
|
|
|
2,056
|
|
|
68
|
|
|
152
|
|
|
28
|
|
||||||
Other
|
|
171
|
|
|
576
|
|
|
3,442
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||||
Total commercial loans
|
|
175,280
|
|
|
189,802
|
|
|
174,688
|
|
|
2,649
|
|
|
3,566
|
|
|
3,867
|
|
||||||
Consumer loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Real estate secured loans
|
|
4,028
|
|
|
1,514
|
|
|
588
|
|
|
15
|
|
|
—
|
|
|
—
|
|
||||||
Other consumer loans
|
|
358
|
|
|
1,804
|
|
|
1,136
|
|
|
—
|
|
|
—
|
|
|
17
|
|
||||||
Total consumer loans
|
|
4,386
|
|
|
3,318
|
|
|
1,724
|
|
|
15
|
|
|
—
|
|
|
17
|
|
||||||
Total average impaired loans
|
|
$
|
179,666
|
|
|
$
|
193,120
|
|
|
$
|
176,412
|
|
|
$
|
2,664
|
|
|
$
|
3,566
|
|
|
$
|
3,884
|
|
Year ended December 31, 2018
(Dollars in thousands)
|
|
Beginning Balance December 31, 2017
|
|
Charge-offs
|
|
Recoveries
|
|
Provision for (Reduction of) Loan Losses
|
|
Foreign Currency Translation Adjustments
|
|
Ending Balance December 31, 2018
|
||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
96,104
|
|
|
$
|
(42,315
|
)
|
|
$
|
5,664
|
|
|
$
|
45,068
|
|
|
$
|
(954
|
)
|
|
$
|
103,567
|
|
Hardware
|
|
27,614
|
|
|
(16,148
|
)
|
|
1,849
|
|
|
6,555
|
|
|
(145
|
)
|
|
19,725
|
|
||||||
Private equity/venture capital
|
|
82,468
|
|
|
(112
|
)
|
|
13
|
|
|
16,485
|
|
|
(273
|
)
|
|
98,581
|
|
||||||
Life science/healthcare
|
|
24,924
|
|
|
(6,662
|
)
|
|
348
|
|
|
14,347
|
|
|
(777
|
)
|
|
32,180
|
|
||||||
Premium wine
|
|
3,532
|
|
|
—
|
|
|
—
|
|
|
(182
|
)
|
|
5
|
|
|
3,355
|
|
||||||
Other
|
|
3,941
|
|
|
(2,391
|
)
|
|
3,275
|
|
|
(1,320
|
)
|
|
53
|
|
|
3,558
|
|
||||||
Total commercial loans
|
|
238,583
|
|
|
(67,628
|
)
|
|
11,149
|
|
|
80,953
|
|
|
(2,091
|
)
|
|
260,966
|
|
||||||
Consumer loans
|
|
16,441
|
|
|
(289
|
)
|
|
487
|
|
|
3,339
|
|
|
(41
|
)
|
|
19,937
|
|
||||||
Total allowance for loan losses
|
|
$
|
255,024
|
|
|
$
|
(67,917
|
)
|
|
$
|
11,636
|
|
|
$
|
84,292
|
|
|
$
|
(2,132
|
)
|
|
$
|
280,903
|
|
Year ended December 31, 2017
(Dollars in thousands)
|
|
Beginning Balance December 31, 2016
|
|
Charge-offs
|
|
Recoveries
|
|
Provision for (Reduction of) Loan Losses
|
|
Foreign Currency Translation Adjustments
|
|
Ending Balance December 31, 2017
|
||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
97,388
|
|
|
$
|
(45,012
|
)
|
|
$
|
4,649
|
|
|
$
|
38,462
|
|
|
$
|
617
|
|
|
$
|
96,104
|
|
Hardware
|
|
31,166
|
|
|
(10,414
|
)
|
|
487
|
|
|
6,051
|
|
|
324
|
|
|
27,614
|
|
||||||
Private equity/venture capital
|
|
50,299
|
|
|
(323
|
)
|
|
—
|
|
|
31,625
|
|
|
867
|
|
|
82,468
|
|
||||||
Life science/healthcare
|
|
25,446
|
|
|
(8,210
|
)
|
|
189
|
|
|
7,414
|
|
|
85
|
|
|
24,924
|
|
||||||
Premium wine
|
|
4,115
|
|
|
—
|
|
|
—
|
|
|
(540
|
)
|
|
(43
|
)
|
|
3,532
|
|
||||||
Other
|
|
4,768
|
|
|
(1,156
|
)
|
|
1,850
|
|
|
(1,459
|
)
|
|
(62
|
)
|
|
3,941
|
|
||||||
Total commercial loans
|
|
213,182
|
|
|
(65,115
|
)
|
|
7,175
|
|
|
81,553
|
|
|
1,788
|
|
|
238,583
|
|
||||||
Consumer loans
|
|
12,184
|
|
|
(1,567
|
)
|
|
1,363
|
|
|
4,386
|
|
|
75
|
|
|
16,441
|
|
||||||
Total allowance for loan losses
|
|
$
|
225,366
|
|
|
$
|
(66,682
|
)
|
|
$
|
8,538
|
|
|
$
|
85,939
|
|
|
$
|
1,863
|
|
|
$
|
255,024
|
|
Year ended December 31, 2016
(Dollars in thousands) |
|
Beginning Balance December 31, 2015
|
|
Charge-offs
|
|
Recoveries
|
|
Provision for (Reduction of) Loan Losses
|
|
Foreign Currency Translation Adjustments
|
|
Ending Balance December 31, 2016
|
||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software/internet
|
|
$
|
103,045
|
|
|
$
|
(68,784
|
)
|
|
$
|
7,278
|
|
|
$
|
58,350
|
|
|
$
|
(2,501
|
)
|
|
$
|
97,388
|
|
Hardware
|
|
23,085
|
|
|
(13,233
|
)
|
|
1,667
|
|
|
20,851
|
|
|
(1,204
|
)
|
|
31,166
|
|
||||||
Private equity/venture capital
|
|
35,282
|
|
|
—
|
|
|
—
|
|
|
15,114
|
|
|
(97
|
)
|
|
50,299
|
|
||||||
Life science/healthcare
|
|
36,576
|
|
|
(9,693
|
)
|
|
1,129
|
|
|
(2,543
|
)
|
|
(23
|
)
|
|
25,446
|
|
||||||
Premium wine
|
|
5,205
|
|
|
—
|
|
|
—
|
|
|
(1,260
|
)
|
|
170
|
|
|
4,115
|
|
||||||
Other
|
|
4,252
|
|
|
(5,045
|
)
|
|
1,880
|
|
|
3,373
|
|
|
308
|
|
|
4,768
|
|
||||||
Total commercial loans
|
|
207,445
|
|
|
(96,755
|
)
|
|
11,954
|
|
|
93,885
|
|
|
(3,347
|
)
|
|
213,182
|
|
||||||
Consumer loans
|
|
10,168
|
|
|
(102
|
)
|
|
258
|
|
|
1,812
|
|
|
48
|
|
|
12,184
|
|
||||||
Total allowance for loan losses
|
|
$
|
217,613
|
|
|
$
|
(96,857
|
)
|
|
$
|
12,212
|
|
|
$
|
95,697
|
|
|
$
|
(3,299
|
)
|
|
$
|
225,366
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Allowance for unfunded credit commitments, beginning balance
|
|
$
|
51,770
|
|
|
$
|
45,265
|
|
|
$
|
34,415
|
|
Provision for unfunded credit commitments
|
|
3,578
|
|
|
6,365
|
|
|
10,982
|
|
|||
Foreign currency translation adjustments
|
|
(165
|
)
|
|
140
|
|
|
(132
|
)
|
|||
Allowance for unfunded credit commitments, ending balance (1)
|
|
$
|
55,183
|
|
|
$
|
51,770
|
|
|
$
|
45,265
|
|
|
(1)
|
See
Note 19—“Off-Balance Sheet Arrangements, Guarantees and Other Commitments” of the “Notes to the Consolidated Financial Statements” under Part II, Item 8 of this report
for additional disclosures related to our commitments to extend credit.
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||||||||||
|
|
Individually Evaluated for Impairment
|
|
Collectively Evaluated for
Impairment
|
|
Individually Evaluated for Impairment
|
|
Collectively Evaluated for
Impairment
|
||||||||||||||||||||||||
(Dollars in thousands)
|
|
Allowance for loan losses
|
|
Recorded investment in loans
|
|
Allowance for loan losses
|
|
Recorded investment in loans
|
|
Allowance for loan losses
|
|
Recorded investment in loans
|
|
Allowance for loan losses
|
|
Recorded investment in loans
|
||||||||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Software/internet
|
|
$
|
28,527
|
|
|
$
|
114,850
|
|
|
$
|
75,040
|
|
|
$
|
6,039,905
|
|
|
$
|
23,088
|
|
|
$
|
110,654
|
|
|
$
|
73,016
|
|
|
$
|
6,061,877
|
|
Hardware
|
|
1,253
|
|
|
11,506
|
|
|
18,472
|
|
|
1,223,051
|
|
|
8,450
|
|
|
36,350
|
|
|
19,164
|
|
|
1,157,249
|
|
||||||||
Private equity/venture capital
|
|
—
|
|
|
3,700
|
|
|
98,581
|
|
|
14,106,860
|
|
|
330
|
|
|
658
|
|
|
82,138
|
|
|
9,951,719
|
|
||||||||
Life science/healthcare
|
|
7,484
|
|
|
34,067
|
|
|
24,696
|
|
|
2,351,545
|
|
|
9,315
|
|
|
21,687
|
|
|
15,609
|
|
|
1,787,140
|
|
||||||||
Premium wine
|
|
—
|
|
|
1,301
|
|
|
3,355
|
|
|
958,362
|
|
|
—
|
|
|
2,877
|
|
|
3,532
|
|
|
870,281
|
|
||||||||
Other
|
|
411
|
|
|
411
|
|
|
3,147
|
|
|
459,079
|
|
|
32
|
|
|
32
|
|
|
3,909
|
|
|
476,306
|
|
||||||||
Total commercial loans
|
|
37,675
|
|
|
165,835
|
|
|
223,291
|
|
|
25,138,802
|
|
|
41,215
|
|
|
172,258
|
|
|
197,368
|
|
|
20,304,572
|
|
||||||||
Total consumer loans
|
|
266
|
|
|
4,239
|
|
|
19,671
|
|
|
3,029,404
|
|
|
578
|
|
|
2,603
|
|
|
15,863
|
|
|
2,626,883
|
|
||||||||
Total
|
|
$
|
37,941
|
|
|
$
|
170,074
|
|
|
$
|
242,962
|
|
|
$
|
28,168,206
|
|
|
$
|
41,793
|
|
|
$
|
174,861
|
|
|
$
|
213,231
|
|
|
$
|
22,931,455
|
|
(Dollars in thousands)
|
|
Pass
|
|
Performing
(Criticized)
|
|
Performing Impaired (Criticized)
|
|
Nonperforming Impaired (Nonaccrual)
|
|
Total
|
||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Software/internet
|
|
$
|
5,574,332
|
|
|
$
|
520,796
|
|
|
$
|
48,069
|
|
|
$
|
66,781
|
|
|
$
|
6,209,978
|
|
Hardware
|
|
1,146,985
|
|
|
87,309
|
|
|
10,250
|
|
|
1,256
|
|
|
1,245,800
|
|
|||||
Private equity/venture capital
|
|
14,098,281
|
|
|
16,151
|
|
|
—
|
|
|
3,700
|
|
|
14,118,132
|
|
|||||
Life science/healthcare
|
|
2,291,356
|
|
|
135,653
|
|
|
16,276
|
|
|
17,791
|
|
|
2,461,076
|
|
|||||
Premium wine
|
|
909,965
|
|
|
49,287
|
|
|
1,017
|
|
|
284
|
|
|
960,553
|
|
|||||
Other
|
|
467,653
|
|
|
17,344
|
|
|
—
|
|
|
411
|
|
|
485,408
|
|
|||||
Total commercial loans
|
|
24,488,572
|
|
|
826,540
|
|
|
75,612
|
|
|
90,223
|
|
|
25,480,947
|
|
|||||
Consumer loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate secured loans
|
|
2,584,261
|
|
|
21,145
|
|
|
320
|
|
|
3,919
|
|
|
2,609,645
|
|
|||||
Other consumer loans
|
|
419,771
|
|
|
949
|
|
|
—
|
|
|
—
|
|
|
420,720
|
|
|||||
Total consumer loans
|
|
3,004,032
|
|
|
22,094
|
|
|
320
|
|
|
3,919
|
|
|
3,030,365
|
|
|||||
Total gross loans
|
|
$
|
27,492,604
|
|
|
$
|
848,634
|
|
|
$
|
75,932
|
|
|
$
|
94,142
|
|
|
$
|
28,511,312
|
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Software/internet
|
|
$
|
5,655,739
|
|
|
$
|
466,332
|
|
|
$
|
31,794
|
|
|
$
|
78,860
|
|
|
$
|
6,232,725
|
|
Hardware
|
|
1,112,574
|
|
|
51,976
|
|
|
20,165
|
|
|
16,185
|
|
|
1,200,900
|
|
|||||
Private equity/venture capital
|
|
9,955,082
|
|
|
5,381
|
|
|
—
|
|
|
658
|
|
|
9,961,121
|
|
|||||
Life science/healthcare
|
|
1,720,613
|
|
|
125,660
|
|
|
1,167
|
|
|
20,520
|
|
|
1,867,960
|
|
|||||
Premium wine
|
|
834,537
|
|
|
36,955
|
|
|
2,476
|
|
|
401
|
|
|
874,369
|
|
|||||
Other
|
|
469,721
|
|
|
21,016
|
|
|
—
|
|
|
32
|
|
|
490,769
|
|
|||||
Total commercial loans
|
|
19,748,266
|
|
|
707,320
|
|
|
55,602
|
|
|
116,656
|
|
|
20,627,844
|
|
|||||
Consumer loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate secured loans
|
|
2,282,375
|
|
|
13,301
|
|
|
—
|
|
|
2,181
|
|
|
2,297,857
|
|
|||||
Other consumer loans
|
|
326,851
|
|
|
1,179
|
|
|
—
|
|
|
422
|
|
|
328,452
|
|
|||||
Total consumer loans
|
|
2,609,226
|
|
|
14,480
|
|
|
—
|
|
|
2,603
|
|
|
2,626,309
|
|
|||||
Total gross loans
|
|
$
|
22,357,492
|
|
|
$
|
721,800
|
|
|
$
|
55,602
|
|
|
$
|
119,259
|
|
|
$
|
23,254,153
|
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Loans modified in TDRs:
|
|
|
|
|
||||
Commercial loans:
|
|
|
|
|
||||
Software/internet
|
|
$
|
58,089
|
|
|
$
|
73,455
|
|
Hardware
|
|
9,665
|
|
|
51,132
|
|
||
Private equity/venture capital
|
|
—
|
|
|
350
|
|
||
Life science/healthcare
|
|
12,738
|
|
|
19,235
|
|
||
Premium wine
|
|
2,883
|
|
|
3,198
|
|
||
Total commercial loans
|
|
83,375
|
|
|
147,370
|
|
||
Consumer loans:
|
|
|
|
|
||||
Other consumer loans
|
|
320
|
|
|
423
|
|
||
Total loans modified in TDRs
|
|
$
|
83,695
|
|
|
$
|
147,793
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Loans modified in TDRs during the period:
|
|
|
|
|
|
|
||||||
Commercial loans:
|
|
|
|
|
|
|
||||||
Software/internet
|
|
$
|
30,429
|
|
|
$
|
42,184
|
|
|
$
|
23,574
|
|
Hardware
|
|
9,665
|
|
|
51,132
|
|
|
14,870
|
|
|||
Private equity/venture capital
|
|
—
|
|
|
350
|
|
|
—
|
|
|||
Life science/healthcare
|
|
660
|
|
|
—
|
|
|
1,638
|
|
|||
Premium wine
|
|
—
|
|
|
177
|
|
|
677
|
|
|||
Total commercial loans
|
|
40,754
|
|
|
93,843
|
|
|
40,759
|
|
|||
Consumer loans:
|
|
|
|
|
|
|
||||||
Other consumer loans
|
|
320
|
|
|
—
|
|
|
786
|
|
|||
Total loans modified in TDRs during the period (1)
|
|
$
|
41,074
|
|
|
$
|
93,843
|
|
|
$
|
41,545
|
|
|
(1)
|
There were
$4.6 million
,
$3.0 million
, and
$3.6 million
of partial charge-offs during
2018
,
2017
and
2016
, respectively.
|
|
|
December 31
|
||||||||||
(Dollars in thousands)
|
|
2018 (1)
|
|
2017 (1)
|
|
2016
|
||||||
TDRs modified within the previous 12 months that defaulted during the period:
|
|
|
|
|
|
|
||||||
Commercial loans:
|
|
|
|
|
|
|
||||||
Hardware
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
134
|
|
Premium wine
|
|
—
|
|
|
—
|
|
|
491
|
|
|||
Life science/healthcare
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total commercial loans
|
|
—
|
|
|
—
|
|
|
625
|
|
|||
Consumer loans:
|
|
|
|
|
|
|
||||||
Other consumer loans
|
|
—
|
|
|
—
|
|
|
786
|
|
|||
Total TDRs modified within the previous 12 months that defaulted in the period
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,411
|
|
|
(1)
|
For both the 2018 and 2017 periods, there were no loans modified in TDRs within the previous 12 months that subsequently defaulted during the period.
|
10.
|
Premises and Equipment
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Computer software
|
|
$
|
217,017
|
|
|
$
|
203,359
|
|
Computer hardware
|
|
70,247
|
|
|
63,881
|
|
||
Leasehold improvements
|
|
98,237
|
|
|
89,225
|
|
||
Furniture and equipment
|
|
42,319
|
|
|
38,146
|
|
||
Total
|
|
427,820
|
|
|
394,611
|
|
||
Accumulated depreciation and amortization
|
|
(298,607
|
)
|
|
(265,929
|
)
|
||
Premises and equipment, net
|
|
$
|
129,213
|
|
|
$
|
128,682
|
|
11.
|
Deposits
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Noninterest-bearing demand
|
|
$
|
39,103,422
|
|
|
$
|
36,655,497
|
|
Interest bearing checking and savings accounts
|
|
648,468
|
|
|
556,121
|
|
||
Money market
|
|
7,498,205
|
|
|
5,975,220
|
|
||
Money market deposits in foreign offices
|
|
152,781
|
|
|
111,201
|
|
||
Sweep deposits in foreign offices
|
|
1,875,298
|
|
|
908,890
|
|
||
Time
|
|
50,726
|
|
|
47,146
|
|
||
Total deposits
|
|
$
|
49,328,900
|
|
|
$
|
44,254,075
|
|
12.
|
Short-Term Borrowings and Long-Term Debt
|
|
|
|
|
|
|
Carrying Value
|
||||||||
(Dollars in thousands)
|
|
Maturity
|
|
Principal value at December 31, 2018
|
|
December 31,
2018 |
|
December 31,
2017 |
||||||
Short-term borrowings:
|
|
|
|
|
|
|
|
|
||||||
Short-term FHLB advances
|
|
(1)
|
|
$
|
300,000
|
|
|
$
|
300,000
|
|
|
$
|
700,000
|
|
Federal funds purchased
|
|
|
|
—
|
|
|
—
|
|
|
330,000
|
|
|||
Securities sold under agreement to repurchase
|
|
(2)
|
|
319,414
|
|
|
319,414
|
|
|
—
|
|
|||
Other short-term borrowings
|
|
(3)
|
|
11,998
|
|
|
11,998
|
|
|
3,730
|
|
|||
Total short-term borrowings
|
|
|
|
|
|
$
|
631,412
|
|
|
$
|
1,033,730
|
|
||
Long-term debt:
|
|
|
|
|
|
|
|
|
||||||
3.50% Senior Notes
|
|
January 29, 2025
|
|
$
|
350,000
|
|
|
$
|
347,639
|
|
|
$
|
347,303
|
|
5.375% Senior Notes
|
|
September 15, 2020
|
|
350,000
|
|
|
348,826
|
|
|
348,189
|
|
|||
Total long-term debt
|
|
|
|
|
|
$
|
696,465
|
|
|
$
|
695,492
|
|
|
(1)
|
Represents advances from the FHLB at
December 31, 2018
with maturity dates through
January 10, 2019.
|
(2)
|
Securities sold under repurchase agreements are effectively short-term borrowings collateralized by U.S Treasury securities. Gross repurchase agreements held at
December 31, 2018
have maturity dates through January 16, 2019.
|
(3)
|
Represents cash collateral received from certain counterparties in relation to market value exposures of derivative contracts in our favor.
|
Year ended December 31,
(Dollars in thousands)
|
|
Amount
|
||
2019
|
|
$
|
—
|
|
2020
|
|
348,826
|
|
|
2021
|
|
—
|
|
|
2022
|
|
—
|
|
|
2023
|
|
—
|
|
|
2024 and thereafter
|
|
347,639
|
|
|
Total
|
|
$
|
696,465
|
|
13.
|
Derivative Financial Instruments
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
|
Notional or
Contractual
Amount
|
|
Fair Value
|
|
Notional or
Contractual
Amount
|
|
Fair Value
|
||||||||||||||||
(Dollars in thousands)
|
|
|
Derivative Assets (1)
|
|
Derivative Liabilities (1)
|
|
|
Derivative Assets (1)
|
|
Derivative Liabilities (1)
|
||||||||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Currency exchange risks:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forwards
|
|
$
|
263,733
|
|
|
$
|
4,767
|
|
|
$
|
—
|
|
|
$
|
50,889
|
|
|
$
|
414
|
|
|
$
|
—
|
|
Foreign exchange forwards
|
|
178,310
|
|
|
—
|
|
|
1,094
|
|
|
425,055
|
|
|
—
|
|
|
5,201
|
|
||||||
Other derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equity warrant assets
|
|
223,532
|
|
|
149,238
|
|
|
—
|
|
|
211,253
|
|
|
123,763
|
|
|
—
|
|
||||||
Client foreign exchange forwards
|
|
2,759,878
|
|
|
93,876
|
|
|
—
|
|
|
2,203,643
|
|
|
95,035
|
|
|
—
|
|
||||||
Client foreign exchange forwards
|
|
2,568,085
|
|
|
—
|
|
|
85,706
|
|
|
2,092,207
|
|
|
—
|
|
|
90,253
|
|
||||||
Client foreign currency options
|
|
93,556
|
|
|
1,759
|
|
|
—
|
|
|
102,678
|
|
|
1,187
|
|
|
—
|
|
||||||
Client foreign currency options
|
|
93,579
|
|
|
—
|
|
|
1,759
|
|
|
102,678
|
|
|
—
|
|
|
1,187
|
|
||||||
Client interest rate derivatives (2)
|
|
1,020,416
|
|
|
8,499
|
|
|
—
|
|
|
726,984
|
|
|
11,753
|
|
|
—
|
|
||||||
Client interest rate derivatives
|
|
1,337,328
|
|
|
—
|
|
|
9,491
|
|
|
782,586
|
|
|
—
|
|
|
11,940
|
|
||||||
Total Derivatives not designated as hedging instruments
|
|
|
|
$
|
258,139
|
|
|
$
|
98,050
|
|
|
|
|
|
$
|
232,152
|
|
|
$
|
108,581
|
|
|
(1)
|
Derivative assets and liabilities are included in
"
accrued interest receivable and other assets
"
and
"
other liabilities
"
, respectively, on our consolidated balance sheets.
|
(2)
|
The amount reported for
December 31, 2018
reflects rule changes implemented by two central clearing houses that allow entities to elect to treat derivative assets, liabilities and the related variation margin as settlement of the related derivative fair values for legal and accounting purposes, as opposed to presenting gross derivative assets and liabilities. As a result, client interest rate derivatives at
December 31, 2018
, reflect reductions of approximately
$0.4 million
of derivative assets that previously would have been reported on a gross basis and approximately
$212.3 million
in related notional amounts for these derivative assets cleared through central clearing houses.
|
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
Statement of income location
|
|
2018
|
|
2017
|
|
2016
|
||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||
Interest rate risks:
|
|
|
|
|
|
|
|
|
||||||
Net cash benefit associated with interest rate swaps
|
|
Interest expense—borrowings
|
|
$
|
—
|
|
|
$
|
1,053
|
|
|
$
|
2,341
|
|
Changes in fair value of interest rate swaps
|
|
Other noninterest income
|
|
—
|
|
|
(7
|
)
|
|
(35
|
)
|
|||
Net gains associated with interest rate risk derivatives
|
|
|
|
$
|
—
|
|
|
$
|
1,046
|
|
|
$
|
2,306
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||
Currency exchange risks:
|
|
|
|
|
|
|
|
|
||||||
(Losses) gains on revaluations of internal foreign currency instruments, net
|
|
Other noninterest income
|
|
$
|
(373
|
)
|
|
$
|
33,161
|
|
|
$
|
(16,676
|
)
|
Gains (losses) on internal foreign exchange forward contracts, net
|
|
Other noninterest income
|
|
52
|
|
|
(32,286
|
)
|
|
16,136
|
|
|||
Net (losses) gains associated with internal currency risk
|
|
|
|
$
|
(321
|
)
|
|
$
|
875
|
|
|
$
|
(540
|
)
|
Other derivative instruments:
|
|
|
|
|
|
|
|
|
||||||
Gains on revaluations of client foreign currency instruments, net
|
|
Other noninterest income
|
|
$
|
4,998
|
|
|
$
|
10,882
|
|
|
$
|
4,215
|
|
Losses on client foreign exchange forward contracts, net
|
|
Other noninterest income
|
|
(4,011
|
)
|
|
(9,969
|
)
|
|
(5,674
|
)
|
|||
Net gains (losses) associated with client currency risk
|
|
|
|
$
|
987
|
|
|
$
|
913
|
|
|
$
|
(1,459
|
)
|
Net gains on equity warrant assets
|
|
Gains on equity warrant assets, net
|
|
$
|
89,142
|
|
|
$
|
54,555
|
|
|
$
|
37,892
|
|
Net (losses) gains on other derivatives
|
|
Other noninterest income
|
|
$
|
(179
|
)
|
|
$
|
(564
|
)
|
|
$
|
262
|
|
(Dollars in thousands)
|
|
Gross Amounts of Recognized Assets
|
|
Gross Amounts offset in the Statement of Financial Position
|
|
Net Amounts of Assets Presented in the Statement of Financial Position
|
|
Gross Amounts Not Offset in the Statement of Financial Position But Subject to Master Netting Arrangements
|
|
Net Amount
|
||||||||||||||
|
|
|
|
Financial Instruments
|
|
Cash Collateral Received (1)
|
|
|||||||||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forwards
|
|
$
|
98,643
|
|
|
$
|
—
|
|
|
$
|
98,643
|
|
|
$
|
(38,213
|
)
|
|
$
|
(11,825
|
)
|
|
$
|
48,605
|
|
Foreign currency options
|
|
1,759
|
|
|
—
|
|
|
1,759
|
|
|
(613
|
)
|
|
(90
|
)
|
|
1,056
|
|
||||||
Client interest rate derivatives
|
|
8,499
|
|
|
—
|
|
|
8,499
|
|
|
(8,416
|
)
|
|
(83
|
)
|
|
—
|
|
||||||
Total derivative assets:
|
|
108,901
|
|
|
—
|
|
|
108,901
|
|
|
(47,242
|
)
|
|
(11,998
|
)
|
|
49,661
|
|
||||||
Reverse repurchase, securities borrowing, and similar arrangements
|
|
123,611
|
|
|
—
|
|
|
123,611
|
|
|
(123,611
|
)
|
|
—
|
|
|
—
|
|
||||||
Total
|
|
$
|
232,512
|
|
|
$
|
—
|
|
|
$
|
232,512
|
|
|
$
|
(170,853
|
)
|
|
$
|
(11,998
|
)
|
|
$
|
49,661
|
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forwards (2)
|
|
$
|
95,449
|
|
|
$
|
—
|
|
|
$
|
95,449
|
|
|
$
|
(14,570
|
)
|
|
$
|
(3,616
|
)
|
|
$
|
77,263
|
|
Foreign currency options
|
|
1,187
|
|
|
—
|
|
|
1,187
|
|
|
(557
|
)
|
|
—
|
|
|
630
|
|
||||||
Client interest rate derivatives (2)
|
|
11,753
|
|
|
—
|
|
|
11,753
|
|
|
(11,627
|
)
|
|
(114
|
)
|
|
12
|
|
||||||
Total derivative assets:
|
|
108,389
|
|
|
—
|
|
|
108,389
|
|
|
(26,754
|
)
|
|
(3,730
|
)
|
|
77,905
|
|
||||||
Reverse repurchase, securities borrowing, and similar arrangements
|
|
247,876
|
|
|
—
|
|
|
247,876
|
|
|
(247,876
|
)
|
|
—
|
|
|
—
|
|
||||||
Total
|
|
$
|
356,265
|
|
|
$
|
—
|
|
|
$
|
356,265
|
|
|
$
|
(274,630
|
)
|
|
$
|
(3,730
|
)
|
|
$
|
77,905
|
|
|
(1)
|
Cash collateral received from our counterparties in relation to market value exposures of derivative contracts in our favor is recorded as a component of “short-term borrowings” on our consolidated balance sheets.
|
(2)
|
For the period ended December 31, 2017, previously reported amounts for our foreign exchange forwards and client interest rate derivatives were reclassified between
"
Financial Instruments
"
and
"
Cash Collateral Received
"
to properly reflect cash collateral received for these derivative assets subject to master netting arrangements, respectively. The correction of this immaterial error had no impact on the
"
Net Amount
"
of derivative assets subject to enforceable master netting arrangements.
|
(Dollars in thousands)
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts offset in the Statement of Financial Position
|
|
Net Amounts of Liabilities Presented in the Statement of Financial Position
|
|
Gross Amounts Not Offset in the Statement of Financial Position But Subject to Master Netting Arrangements
|
|
Net Amount
|
||||||||||||||
|
|
|
|
Financial Instruments
|
|
Cash Collateral Pledged (1)
|
|
|||||||||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forwards
|
|
$
|
86,800
|
|
|
$
|
—
|
|
|
$
|
86,800
|
|
|
$
|
(24,778
|
)
|
|
$
|
(20,732
|
)
|
|
$
|
41,290
|
|
Foreign currency options
|
|
1,759
|
|
|
—
|
|
|
1,759
|
|
|
(1,054
|
)
|
|
—
|
|
|
705
|
|
||||||
Client interest rate derivatives
|
|
9,491
|
|
|
—
|
|
|
9,491
|
|
|
—
|
|
|
(9,207
|
)
|
|
284
|
|
||||||
Total derivative liabilities:
|
|
98,050
|
|
|
—
|
|
|
98,050
|
|
|
(25,832
|
)
|
|
(29,939
|
)
|
|
42,279
|
|
||||||
Repurchase, securities lending, and similar arrangements
|
|
319,414
|
|
|
—
|
|
|
319,414
|
|
|
—
|
|
|
—
|
|
|
319,414
|
|
||||||
Total
|
|
$
|
417,464
|
|
|
$
|
—
|
|
|
$
|
417,464
|
|
|
$
|
(25,832
|
)
|
|
$
|
(29,939
|
)
|
|
$
|
361,693
|
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forwards (2)
|
|
$
|
95,454
|
|
|
$
|
—
|
|
|
$
|
95,454
|
|
|
$
|
(10,997
|
)
|
|
$
|
(69,110
|
)
|
|
$
|
15,347
|
|
Foreign currency options (2)
|
|
1,187
|
|
|
—
|
|
|
1,187
|
|
|
(501
|
)
|
|
(130
|
)
|
|
556
|
|
||||||
Client interest rate derivatives (2)
|
|
11,940
|
|
|
—
|
|
|
11,940
|
|
|
—
|
|
|
(11,924
|
)
|
|
16
|
|
||||||
Total derivative liabilities: (2)
|
|
108,581
|
|
|
—
|
|
|
108,581
|
|
|
(11,498
|
)
|
|
(81,164
|
)
|
|
15,919
|
|
||||||
Repurchase, securities lending, and similar arrangements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total (2)
|
|
$
|
108,581
|
|
|
$
|
—
|
|
|
$
|
108,581
|
|
|
$
|
(11,498
|
)
|
|
$
|
(81,164
|
)
|
|
$
|
15,919
|
|
|
(1)
|
Cash collateral pledged to our counterparties in relation to market value exposures of derivative contracts in a liability position and repurchase agreements are recorded as a component of “cash and cash equivalents
"
on our consolidated balance sheets.
|
(2)
|
For the period ended December 31, 2017, previously reported amounts included in
"
Financial Instruments
"
were reclassified to
"
Cash Collateral Pledged
"
to properly reflect cash collateral pledged for these derivative liabilities subject to master netting arrangements. The correction of this immaterial error had no impact on the
"
Net Amount
"
of derivative liabilities subject to enforceable master netting arrangements.
|
14.
|
Noninterest Income
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Noninterest income:
|
|
|
|
|
|
|
||||||
Gains on investment securities, net
|
|
$
|
88,094
|
|
|
$
|
64,603
|
|
|
$
|
51,740
|
|
Gains on equity warrant assets, net
|
|
89,142
|
|
|
54,555
|
|
|
37,892
|
|
|||
Foreign exchange fees
|
|
138,812
|
|
|
115,760
|
|
|
104,183
|
|
|||
Credit card fees
|
|
94,072
|
|
|
76,543
|
|
|
68,205
|
|
|||
Deposit service charges
|
|
76,097
|
|
|
58,715
|
|
|
52,524
|
|
|||
Client investment fees
|
|
130,360
|
|
|
56,136
|
|
|
32,219
|
|
|||
Lending related fees
|
|
41,949
|
|
|
43,265
|
|
|
33,395
|
|
|||
Letters of credit and standby letters of credit fees
|
|
34,600
|
|
|
28,544
|
|
|
25,644
|
|
|||
Other
|
|
51,858
|
|
|
59,110
|
|
|
50,750
|
|
|||
Total noninterest income
|
|
$
|
744,984
|
|
|
$
|
557,231
|
|
|
$
|
456,552
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Gains on non-marketable and other equity securities, net
|
|
$
|
88,834
|
|
|
$
|
69,792
|
|
|
$
|
39,545
|
|
(Losses) gains on sales of available-for-sale debt securities, net
|
|
(740
|
)
|
|
(5,189
|
)
|
|
12,195
|
|
|||
Total gains on investment securities, net
|
|
$
|
88,094
|
|
|
$
|
64,603
|
|
|
$
|
51,740
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Equity warrant assets:
|
|
|
|
|
|
|
||||||
Gains on exercises, net
|
|
$
|
58,186
|
|
|
$
|
48,275
|
|
|
$
|
31,197
|
|
Terminations
|
|
(5,964
|
)
|
|
(4,422
|
)
|
|
(3,015
|
)
|
|||
Changes in fair value, net
|
|
36,920
|
|
|
10,702
|
|
|
9,710
|
|
|||
Total net gains on equity warrant assets
|
|
$
|
89,142
|
|
|
$
|
54,555
|
|
|
$
|
37,892
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Foreign exchange fees by instrument type:
|
|
|
|
|
|
|
||||||
Spot contract commissions
|
|
$
|
127,459
|
|
|
$
|
104,344
|
|
|
$
|
89,354
|
|
Forward contract commissions
|
|
10,940
|
|
|
10,934
|
|
|
14,004
|
|
|||
Option premium fees
|
|
413
|
|
|
482
|
|
|
825
|
|
|||
Total foreign exchange fees
|
|
$
|
138,812
|
|
|
$
|
115,760
|
|
|
$
|
104,183
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Credit card fees by instrument type:
|
|
|
|
|
|
|
||||||
Card interchange fees, net
|
|
$
|
74,381
|
|
|
$
|
60,224
|
|
|
$
|
51,513
|
|
Merchant service fees
|
|
14,420
|
|
|
11,584
|
|
|
12,783
|
|
|||
Card service fees
|
|
5,271
|
|
|
4,735
|
|
|
3,909
|
|
|||
Total credit card fees
|
|
$
|
94,072
|
|
|
$
|
76,543
|
|
|
$
|
68,205
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Client investment fees by type:
|
|
|
|
|
|
|
||||||
Sweep money market fees
|
|
$
|
75,654
|
|
|
$
|
28,485
|
|
|
$
|
15,147
|
|
Asset management fees (1)
|
|
23,882
|
|
|
16,831
|
|
|
15,389
|
|
|||
Repurchase agreement fees
|
|
30,824
|
|
|
10,820
|
|
|
1,683
|
|
|||
Total client investment fees (2)
|
|
$
|
130,360
|
|
|
$
|
56,136
|
|
|
$
|
32,219
|
|
|
(1)
|
Represents fees earned from investments in third-party money market mutual funds and fixed-income securities managed by SVB Asset Management.
|
(2)
|
Represents fees earned on client investment funds which are maintained at third-party financial institutions and are not recorded on our balance sheet.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Lending related fees by instrument type:
|
|
|
|
|
|
|
||||||
Unused commitment fees
|
|
$
|
32,452
|
|
|
$
|
34,110
|
|
|
$
|
25,654
|
|
Other
|
|
9,497
|
|
|
9,155
|
|
|
7,741
|
|
|||
Total lending related fees
|
|
$
|
41,949
|
|
|
$
|
43,265
|
|
|
$
|
33,395
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Other noninterest income by instrument type:
|
|
|
|
|
|
|
||||||
Fund management fees
|
|
$
|
23,016
|
|
|
$
|
21,214
|
|
|
$
|
19,195
|
|
Net gains (losses) on revaluation of foreign currency instruments, net of foreign exchange forward contracts (1)
|
|
666
|
|
|
1,788
|
|
|
(1,999
|
)
|
|||
Other service revenue
|
|
28,176
|
|
|
36,108
|
|
|
33,554
|
|
|||
Total other noninterest income
|
|
$
|
51,858
|
|
|
$
|
59,110
|
|
|
$
|
50,750
|
|
|
(1)
|
Represents the net revaluation of client and internal foreign currency denominated financial instruments. We enter into foreign exchange forward contracts to economically reduce our foreign exchange exposure related to client and internal foreign currency denominated financial instruments.
|
(Dollars in thousands)
|
|
Global
Commercial
Bank
|
|
SVB Private
Bank
|
|
SVB Capital
|
|
Other Income
|
|
Total
|
||||||||||
Revenue from contracts with customers:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Spot contract commissions
|
|
$
|
126,445
|
|
|
$
|
691
|
|
|
$
|
—
|
|
|
$
|
323
|
|
|
$
|
127,459
|
|
Card interchange fees, gross
|
|
134,074
|
|
|
—
|
|
|
—
|
|
|
428
|
|
|
134,502
|
|
|||||
Merchant service fees
|
|
14,415
|
|
|
4
|
|
|
—
|
|
|
1
|
|
|
14,420
|
|
|||||
Deposit service charges
|
|
74,348
|
|
|
108
|
|
|
—
|
|
|
1,641
|
|
|
76,097
|
|
|||||
Client investment fees
|
|
53,179
|
|
|
1,526
|
|
|
—
|
|
|
75,655
|
|
|
130,360
|
|
|||||
Fund management fees
|
|
—
|
|
|
—
|
|
|
23,016
|
|
|
—
|
|
|
23,016
|
|
|||||
Correspondent bank rebates
|
|
5,802
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,802
|
|
|||||
Total revenue from contracts with customers
|
|
$
|
408,263
|
|
|
$
|
2,329
|
|
|
$
|
23,016
|
|
|
$
|
78,048
|
|
|
$
|
511,656
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues outside the scope of ASC 606 (1)
|
|
36,384
|
|
|
(48
|
)
|
|
78,165
|
|
|
118,827
|
|
|
233,328
|
|
|||||
Total noninterest income
|
|
$
|
444,647
|
|
|
$
|
2,281
|
|
|
$
|
101,181
|
|
|
$
|
196,875
|
|
|
$
|
744,984
|
|
|
(1)
|
Amounts are accounted for under separate guidance than ASC 606.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Lending and other client related processing costs
|
|
$
|
24,237
|
|
|
$
|
23,768
|
|
|
$
|
19,867
|
|
Telephone
|
|
9,404
|
|
|
10,647
|
|
|
9,793
|
|
|||
Data processing services
|
|
10,811
|
|
|
10,251
|
|
|
9,014
|
|
|||
Dues and publications
|
|
4,605
|
|
|
3,263
|
|
|
2,828
|
|
|||
Postage and supplies
|
|
2,799
|
|
|
2,797
|
|
|
2,851
|
|
|||
Other
|
|
21,682
|
|
|
21,419
|
|
|
17,890
|
|
|||
Total other noninterest expense
|
|
$
|
73,538
|
|
|
$
|
72,145
|
|
|
$
|
62,243
|
|
16.
|
Income Taxes
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Current provision:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
249,358
|
|
|
$
|
263,231
|
|
|
$
|
195,249
|
|
State
|
|
123,264
|
|
|
67,046
|
|
|
59,319
|
|
|||
Deferred (benefit) expense:
|
|
|
|
|
|
|
||||||
Federal
|
|
(11,777
|
)
|
|
24,654
|
|
|
(3,560
|
)
|
|||
State
|
|
(9,284
|
)
|
|
532
|
|
|
(675
|
)
|
|||
Income tax expense
|
|
$
|
351,561
|
|
|
$
|
355,463
|
|
|
$
|
250,333
|
|
|
|
December 31,
|
|||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
|||
Federal statutory income tax rate
|
|
21.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes, net of the federal tax effect
|
|
7.2
|
|
|
5.8
|
|
|
5.9
|
|
Net deferred tax assets revaluation (TCJ Act)
|
|
—
|
|
|
4.3
|
|
|
—
|
|
Meals and entertainment
|
|
0.3
|
|
|
0.3
|
|
|
0.4
|
|
Disallowed officers' compensation
|
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
FDIC premiums
|
|
0.5
|
|
|
—
|
|
|
—
|
|
Share-based compensation expense on incentive stock options and ESPP
|
|
(1.4
|
)
|
|
(2.1
|
)
|
|
—
|
|
Qualified affordable housing project tax credits
|
|
(0.3
|
)
|
|
(0.4
|
)
|
|
(0.5
|
)
|
Tax-exempt interest income
|
|
(0.6
|
)
|
|
(0.3
|
)
|
|
(0.2
|
)
|
Valuation allowance benefit
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
Other, net
|
|
(0.4
|
)
|
|
(0.7
|
)
|
|
(0.9
|
)
|
Effective income tax rate
|
|
26.5
|
%
|
|
42.0
|
%
|
|
39.5
|
%
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Allowance for loan losses
|
|
$
|
93,580
|
|
|
$
|
84,812
|
|
Net unrealized losses on AFS debt securities
|
|
19,704
|
|
|
12,404
|
|
||
Share-based compensation expense
|
|
10,642
|
|
|
9,418
|
|
||
State income taxes
|
|
13,854
|
|
|
9,186
|
|
||
Accrued compensation
|
|
8,291
|
|
|
8,336
|
|
||
Deferred rent
|
|
7,940
|
|
|
8,169
|
|
||
Other accruals
|
|
7,061
|
|
|
7,165
|
|
||
Net operating loss
|
|
2,447
|
|
|
2,300
|
|
||
Loan fee income and costs
|
|
—
|
|
|
1,189
|
|
||
Other
|
|
11,339
|
|
|
3,639
|
|
||
Deferred tax assets
|
|
174,858
|
|
|
146,618
|
|
||
Valuation allowance
|
|
(2,107
|
)
|
|
(2,624
|
)
|
||
Net deferred tax assets after valuation allowance
|
|
172,751
|
|
|
143,994
|
|
||
|
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
|
||||
Derivative equity warrant assets
|
|
(32,861
|
)
|
|
(29,127
|
)
|
||
Change in accounting method (section 481(a))
|
|
(8,034
|
)
|
|
(15,953
|
)
|
||
Net unrealized gains on AFS equity securities
|
|
—
|
|
|
(11,145
|
)
|
||
Non-marketable and other equity securities
|
|
(45,759
|
)
|
|
(10,724
|
)
|
||
Premises and equipment and other intangibles
|
|
(10,284
|
)
|
|
(9,223
|
)
|
||
Other
|
|
(10,380
|
)
|
|
(3,977
|
)
|
||
Deferred tax liabilities
|
|
(107,318
|
)
|
|
(80,149
|
)
|
||
Net deferred tax assets
|
|
$
|
65,433
|
|
|
$
|
63,845
|
|
(Dollars in thousands)
|
|
Reconciliation of Unrecognized Tax Benefit
|
|
Interest and Penalties
|
|
Total
|
||||||
Balance at December 31, 2015
|
|
$
|
3,357
|
|
|
$
|
301
|
|
|
$
|
3,658
|
|
Additions for tax positions for current year
|
|
793
|
|
|
—
|
|
|
793
|
|
|||
Additions for tax positions for prior years
|
|
1,427
|
|
|
166
|
|
|
1,593
|
|
|||
Reduction for tax positions for prior years
|
|
(271
|
)
|
|
(16
|
)
|
|
(287
|
)
|
|||
Lapse of the applicable statute of limitations
|
|
(37
|
)
|
|
(9
|
)
|
|
(46
|
)
|
|||
Balance at December 31, 2016
|
|
$
|
5,269
|
|
|
$
|
442
|
|
|
$
|
5,711
|
|
Additions for tax positions for current year
|
|
3,141
|
|
|
—
|
|
|
3,141
|
|
|||
Additions for tax positions for prior years
|
|
3,378
|
|
|
754
|
|
|
4,132
|
|
|||
Reduction for tax positions for prior years
|
|
(223
|
)
|
|
(1
|
)
|
|
(224
|
)
|
|||
Lapse of the applicable statute of limitations
|
|
(60
|
)
|
|
(17
|
)
|
|
(77
|
)
|
|||
Balance at December 31, 2017
|
|
$
|
11,505
|
|
|
$
|
1,178
|
|
|
$
|
12,683
|
|
Additions for tax positions for current year
|
|
4,171
|
|
|
—
|
|
|
4,171
|
|
|||
Additions for tax positions for prior years
|
|
631
|
|
|
823
|
|
|
1,454
|
|
|||
Reduction for tax positions for prior years
|
|
(1,865
|
)
|
|
(243
|
)
|
|
(2,108
|
)
|
|||
Lapse of the applicable statute of limitations
|
|
(435
|
)
|
|
(86
|
)
|
|
(521
|
)
|
|||
Reduction as a result of settlement
|
|
(1,318
|
)
|
|
$
|
(222
|
)
|
|
$
|
(1,540
|
)
|
|
Balance at December 31, 2018
|
|
$
|
12,689
|
|
|
$
|
1,450
|
|
|
$
|
14,139
|
|
17.
|
Employee Compensation and Benefit Plans
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Incentive Compensation Plan
|
|
$
|
160,293
|
|
|
$
|
125,584
|
|
|
$
|
96,892
|
|
Direct Drive Incentive Compensation Plan
|
|
40,578
|
|
|
18,721
|
|
|
21,174
|
|
|||
Retention Program
|
|
1,438
|
|
|
1,317
|
|
|
1,475
|
|
|||
Warrant Incentive Plan
|
|
9,112
|
|
|
15,386
|
|
|
4,954
|
|
|||
Deferred Compensation Plan
|
|
—
|
|
|
203
|
|
|
1,318
|
|
|||
SVBFG 401(k) Plan
|
|
21,323
|
|
|
17,860
|
|
|
16,078
|
|
|||
SVBFG ESOP
|
|
6,435
|
|
|
4,719
|
|
|
3,159
|
|
18.
|
Related Parties
|
19.
|
Off-Balance Sheet Arrangements, Guarantees and Other Commitments
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Loan commitments available for funding: (1)
|
|
|
|
|
||||
Fixed interest rate commitments
|
|
$
|
1,839,190
|
|
|
$
|
1,478,157
|
|
Variable interest rate commitments
|
|
14,821,815
|
|
|
14,034,169
|
|
||
Total loan commitments available for funding
|
|
16,661,005
|
|
|
15,512,326
|
|
||
Commercial and standby letters of credit (2)
|
|
2,252,016
|
|
|
1,950,211
|
|
||
Total unfunded credit commitments
|
|
$
|
18,913,021
|
|
|
$
|
17,462,537
|
|
Commitments unavailable for funding (3)
|
|
$
|
2,723,835
|
|
|
$
|
2,117,057
|
|
Allowance for unfunded credit commitments (4)
|
|
55,183
|
|
|
51,770
|
|
|
(1)
|
Represents commitments which are available for funding, due to clients meeting all collateral, compliance and financial covenants required under loan commitment agreements.
|
(2)
|
See below for additional information on our commercial and standby letters of credit.
|
(3)
|
Represents commitments which are currently unavailable for funding due to clients failing to meet all collateral, compliance and financial covenants under loan commitment agreements.
|
(4)
|
Our allowance for unfunded credit commitments includes an allowance for both our unfunded loan commitments and our letters of credit.
|
(Dollars in thousands)
|
|
Expires In One Year or Less
|
|
Expires After One Year
|
|
Total Amount Outstanding
|
|
Maximum Amount of Future Payments
|
||||||||
Financial standby letters of credit
|
|
$
|
2,043,767
|
|
|
$
|
33,570
|
|
|
$
|
2,077,337
|
|
|
$
|
2,077,337
|
|
Performance standby letters of credit
|
|
133,259
|
|
|
3,746
|
|
|
137,005
|
|
|
137,005
|
|
||||
Commercial letters of credit
|
|
37,323
|
|
|
351
|
|
|
37,674
|
|
|
37,674
|
|
||||
Total
|
|
$
|
2,214,349
|
|
|
$
|
37,667
|
|
|
$
|
2,252,016
|
|
|
$
|
2,252,016
|
|
(Dollars in thousands)
|
|
SVBFG Capital Commitments
|
|
SVBFG Unfunded
Commitments
|
|
SVBFG Ownership
of each Fund (3)
|
|||||
CP I, LP
|
|
$
|
6,000
|
|
|
$
|
270
|
|
|
10.7
|
%
|
CP II, LP (1)
|
|
1,200
|
|
|
162
|
|
|
5.1
|
|
||
Shanghai Yangpu Venture Capital Fund (LP)
|
|
843
|
|
|
—
|
|
|
6.8
|
|
||
Strategic Investors Fund, LP
|
|
15,300
|
|
|
688
|
|
|
12.6
|
|
||
Strategic Investors Fund II, LP
|
|
15,000
|
|
|
1,050
|
|
|
8.6
|
|
||
Strategic Investors Fund III, LP
|
|
15,000
|
|
|
1,275
|
|
|
5.9
|
|
||
Strategic Investors Fund IV, LP
|
|
12,239
|
|
|
2,325
|
|
|
5.0
|
|
||
Strategic Investors Fund V funds
|
|
515
|
|
|
131
|
|
|
Various
|
|
||
Capital Preferred Return Fund, LP
|
|
12,688
|
|
|
—
|
|
|
20.0
|
|
||
Growth Partners, LP
|
|
24,670
|
|
|
1,340
|
|
|
33.0
|
|
||
Debt funds (equity method accounting)
|
|
58,493
|
|
|
—
|
|
|
Various
|
|
||
Other fund investments (2)
|
|
295,722
|
|
|
8,011
|
|
|
Various
|
|
||
Total
|
|
$
|
457,670
|
|
|
$
|
15,252
|
|
|
|
|
(1)
|
Our ownership includes direct ownership of
1.3 percent
and indirect ownership of
3.8 percent
through our investment in Strategic Investors Fund II, LP.
|
(2)
|
Represents commitments to
216
funds (primarily venture capital funds) where our ownership interest is generally less than
five percent
of the voting interests of each such fund.
|
(3)
|
We are subject to the Volcker Rule which restricts or limits us from sponsoring or having ownership interests in “covered” funds including venture capital and private equity funds. See “Business - Supervision and Regulation” under Part I, Item 1 of this report.
|
(Dollars in thousands)
|
|
Unfunded Commitments
|
||
Strategic Investors Fund, LP
|
|
$
|
1,338
|
|
Capital Preferred Return Fund, LP
|
|
1,936
|
|
|
Growth Partners, LP
|
|
2,575
|
|
|
Total
|
|
$
|
5,849
|
|
Year ended December 31,
(Dollars in thousands)
|
|
Amount
|
||
2019
|
|
$
|
38,609
|
|
2020
|
|
37,575
|
|
|
2021
|
|
35,854
|
|
|
2022
|
|
31,659
|
|
|
2023
|
|
30,904
|
|
|
2024 and thereafter
|
|
49,071
|
|
|
Net minimum operating lease payments
|
|
$
|
223,672
|
|
20.
|
Fair Value of Financial Instruments
|
(Dollars in thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Balance at December 31, 2018
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
|
$
|
4,738,258
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,738,258
|
|
U.S. agency debentures
|
|
—
|
|
|
1,084,117
|
|
|
—
|
|
|
1,084,117
|
|
||||
Foreign government debt securities
|
|
5,812
|
|
|
—
|
|
|
—
|
|
|
5,812
|
|
||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
||||||||
Agency-issued collateralized mortgage obligations
— f
ixed rate
|
|
—
|
|
|
1,880,218
|
|
|
—
|
|
|
1,880,218
|
|
||||
Agency-issued collateralized mortgage obligations— variable rate
|
|
—
|
|
|
81,638
|
|
|
—
|
|
|
81,638
|
|
||||
Total available-for-sale securities
|
|
4,744,070
|
|
|
3,045,973
|
|
|
—
|
|
|
7,790,043
|
|
||||
Non-marketable and other equity securities (fair value accounting):
|
|
|
|
|
|
|
|
|
||||||||
Non-marketable securities:
|
|
|
|
|
|
|
|
|
||||||||
Venture capital and private equity fund investments measured at net asset value
|
|
—
|
|
|
—
|
|
|
—
|
|
|
318,352
|
|
||||
Venture capital and private equity fund investments not measured at net asset value (1)
|
|
—
|
|
|
—
|
|
|
1,079
|
|
|
1,079
|
|
||||
Other equity securities in public companies
|
|
1,181
|
|
|
19,217
|
|
|
—
|
|
|
20,398
|
|
||||
Total non-marketable and other equity securities (fair value
accounting)
|
|
1,181
|
|
|
19,217
|
|
|
1,079
|
|
|
339,829
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward and option contracts
|
|
—
|
|
|
100,402
|
|
|
—
|
|
|
100,402
|
|
||||
Equity warrant assets
|
|
—
|
|
|
4,039
|
|
|
145,199
|
|
|
149,238
|
|
||||
Client interest rate derivatives
|
|
—
|
|
|
8,499
|
|
|
—
|
|
|
8,499
|
|
||||
Total assets
|
|
$
|
4,745,251
|
|
|
$
|
3,178,130
|
|
|
$
|
146,278
|
|
|
$
|
8,388,011
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward and option contracts
|
|
$
|
—
|
|
|
$
|
88,559
|
|
|
$
|
—
|
|
|
$
|
88,559
|
|
Client interest rate derivatives
|
|
—
|
|
|
9,491
|
|
|
—
|
|
|
9,491
|
|
||||
Total liabilities
|
|
$
|
—
|
|
|
$
|
98,050
|
|
|
$
|
—
|
|
|
$
|
98,050
|
|
|
(1)
|
Included in Level 3 assets is
$0.9 million
attributable to noncontrolling interests calculated based on the ownership percentages of the noncontrolling interests.
|
(Dollars in thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Balance at December 31, 2017
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury securities
|
|
$
|
6,840,502
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,840,502
|
|
U.S. agency debentures
|
|
—
|
|
|
1,567,128
|
|
|
—
|
|
|
1,567,128
|
|
||||
Residential mortgage-backed securities:
|
|
|
|
|
|
|
|
|
||||||||
Agency-issued collateralized mortgage obligations— fixed rate
|
|
—
|
|
|
2,267,035
|
|
|
—
|
|
|
2,267,035
|
|
||||
Agency-issued collateralized mortgage obligations— variable rate
|
|
—
|
|
|
373,730
|
|
|
—
|
|
|
373,730
|
|
||||
Equity securities
|
|
158
|
|
|
72,111
|
|
|
—
|
|
|
72,269
|
|
||||
Total available-for-sale securities
|
|
6,840,660
|
|
|
4,280,004
|
|
|
—
|
|
|
11,120,664
|
|
||||
Non-marketable and other equity securities (fair value accounting):
|
|
|
|
|
|
|
|
|
||||||||
Non-marketable securities:
|
|
|
|
|
|
|
|
|
||||||||
Venture capital and private equity fund investments measured at net asset value
|
|
—
|
|
|
—
|
|
|
—
|
|
|
127,192
|
|
||||
Venture capital and private equity fund investments not measured at net asset value (1)
|
|
—
|
|
|
—
|
|
|
919
|
|
|
919
|
|
||||
Other equity securities in public companies (1)
|
|
310
|
|
|
—
|
|
|
—
|
|
|
310
|
|
||||
Total non-marketable and other equity securities (fair value
accounting)
|
|
310
|
|
|
—
|
|
|
919
|
|
|
128,421
|
|
||||
Other assets:
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward and option contracts
|
|
—
|
|
|
96,636
|
|
|
—
|
|
|
96,636
|
|
||||
Equity warrant assets
|
|
—
|
|
|
2,432
|
|
|
121,331
|
|
|
123,763
|
|
||||
Client interest rate derivatives
|
|
—
|
|
|
11,753
|
|
|
—
|
|
|
11,753
|
|
||||
Total assets
|
|
$
|
6,840,970
|
|
|
$
|
4,390,825
|
|
|
$
|
122,250
|
|
|
$
|
11,481,237
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward and option contracts
|
|
$
|
—
|
|
|
$
|
96,641
|
|
|
$
|
—
|
|
|
$
|
96,641
|
|
Client interest rate derivatives
|
|
—
|
|
|
11,940
|
|
|
—
|
|
|
11,940
|
|
||||
Total liabilities
|
|
$
|
—
|
|
|
$
|
108,581
|
|
|
$
|
—
|
|
|
$
|
108,581
|
|
|
(1)
|
Included in Level 1 and Level 3 assets are
$0.2 million
and
$0.8 million
, respectively, attributable to noncontrolling interests calculated based on the ownership percentages of the noncontrolling interests.
|
(Dollars in thousands)
|
|
Beginning
Balance
|
|
Total Realized and Unrealized Gains (Losses), net Included in Income
|
|
Sales/Exits
|
|
Issuances
|
|
Distributions and Other Settlements
|
|
Transfers Out of Level 3
|
|
Ending
Balance
|
||||||||||||||
Year ended December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Non-marketable and other equity securities (fair value accounting):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Venture capital and private equity fund investments not measured at net asset value (1)
|
|
$
|
919
|
|
|
$
|
457
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(297
|
)
|
|
$
|
—
|
|
|
$
|
1,079
|
|
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Equity warrant assets (2)
|
|
121,331
|
|
|
87,982
|
|
|
(78,752
|
)
|
|
17,941
|
|
|
—
|
|
|
(3,303
|
)
|
|
145,199
|
|
|||||||
Total assets
|
|
$
|
122,250
|
|
|
$
|
88,439
|
|
|
$
|
(78,752
|
)
|
|
$
|
17,941
|
|
|
$
|
(297
|
)
|
|
$
|
(3,303
|
)
|
|
$
|
146,278
|
|
Year ended December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Non-marketable and other equity securities (fair value accounting):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Venture capital and private equity fund investments not measured at net asset value (1)
|
|
$
|
2,040
|
|
|
$
|
971
|
|
|
$
|
(2,092
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
919
|
|
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Equity warrant assets (2)
|
|
128,813
|
|
|
54,263
|
|
|
(74,769
|
)
|
|
14,537
|
|
|
—
|
|
|
(1,513
|
)
|
|
121,331
|
|
|||||||
Total assets
|
|
$
|
130,853
|
|
|
$
|
55,234
|
|
|
$
|
(76,861
|
)
|
|
$
|
14,537
|
|
|
$
|
—
|
|
|
$
|
(1,513
|
)
|
|
$
|
122,250
|
|
Year ended December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Non-marketable and other equity securities (fair value accounting):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Venture capital and private equity fund investments not measured at net asset value (1)
|
|
$
|
2,040
|
|
|
$
|
(21
|
)
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
25
|
|
|
$
|
—
|
|
|
$
|
2,040
|
|
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Equity warrant assets (2)
|
|
135,168
|
|
|
38,091
|
|
|
(56,643
|
)
|
|
13,405
|
|
|
—
|
|
|
(1,208
|
)
|
|
128,813
|
|
|||||||
Total assets
|
|
$
|
137,208
|
|
|
$
|
38,070
|
|
|
$
|
(56,647
|
)
|
|
$
|
13,405
|
|
|
$
|
25
|
|
|
$
|
(1,208
|
)
|
|
$
|
130,853
|
|
|
(1)
|
Realized and unrealized gains (losses) are recorded in the line item “Gains on investment securities, net,” a component of noninterest income.
|
(2)
|
Realized and unrealized gains (losses) are recorded in the line item “Gains on equity warrant assets, net,” a component of noninterest income.
|
|
|
Year ended December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Non-marketable and other equity securities (fair value accounting):
|
|
|
|
|
||||
Venture capital and private equity fund investments not measured at net asset value (1)
|
|
$
|
160
|
|
|
$
|
(444
|
)
|
Other assets:
|
|
|
|
|
||||
Equity warrant assets (2)
|
|
37,564
|
|
|
11,174
|
|
||
Total unrealized gains, net
|
|
$
|
37,724
|
|
|
$
|
10,730
|
|
Unrealized gains (losses) attributable to noncontrolling interests (1)
|
|
$
|
143
|
|
|
$
|
(397
|
)
|
|
(1)
|
Unrealized gains are recorded on the line item “gains on investment securities, net,” a component of noninterest income.
|
(2)
|
Unrealized gains are recorded on the line item “gains on equity warrant assets, net,” a component of noninterest income.
|
(Dollars in thousands)
|
|
Fair Value
|
|
Valuation Technique
|
|
Significant Unobservable Inputs
|
|
Weighted Average
|
|||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|||
Venture capital and private equity fund investments (fair value accounting)
|
|
$
|
1,079
|
|
|
Private company equity pricing
|
|
(1)
|
|
(1)
|
|
Equity warrant assets (public portfolio)
|
|
2,757
|
|
|
Black-Scholes option pricing model
|
|
Volatility
|
|
54.7
|
%
|
|
Risk-Free interest rate
|
2.6
|
|
|||||||||
Sales restrictions discount (2)
|
18.5
|
|
|||||||||
Equity warrant assets (private portfolio)
|
|
142,442
|
|
|
Black-Scholes option pricing model
|
|
Volatility
|
|
38.5
|
|
|
Risk-Free interest rate
|
2.5
|
|
|||||||||
Marketability discount (3)
|
17.7
|
|
|||||||||
Remaining life assumption (4)
|
45.0
|
|
|||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|||
Venture capital and private equity fund investments (fair value accounting)
|
|
$
|
919
|
|
|
Private company equity pricing
|
|
(1)
|
|
(1)
|
|
Equity warrant assets (public portfolio)
|
|
1,936
|
|
|
Black-Scholes option pricing model
|
|
Volatility
|
|
47.9
|
%
|
|
Risk-Free interest rate
|
2.1
|
|
|||||||||
Sales restrictions discount (2)
|
15.5
|
|
|||||||||
Equity warrant assets (private portfolio)
|
|
119,395
|
|
|
Black-Scholes option pricing model
|
|
Volatility
|
|
36.7
|
|
|
Risk-Free interest rate
|
1.8
|
|
|||||||||
Marketability discount (3)
|
16.4
|
|
|||||||||
Remaining life assumption (4)
|
45.0
|
|
|
(1)
|
In determining the fair value of our venture capital and private equity fund investment portfolio (not measured at net asset value), we evaluate a variety of factors related to each underlying private portfolio company including, but not limited to, actual and forecasted results, cash position, recent or planned transactions and market comparable companies. Additionally, we have ongoing communication with the portfolio companies and venture capital fund managers, to determine whether there is a material change in fair value. We use company provided valuation reports, if available, to support our valuation
|
(2)
|
We adjust quoted market prices of public companies, which are subject to certain sales restrictions. Sales restriction discounts generally range from
10 percent
to
20 percent
depending on the duration of the sales restrictions which typically range from
three
to
six
months.
|
(3)
|
Our marketability discount is applied to all private company warrants to account for a general lack of liquidity due to the private nature of the associated underlying company. The quantitative measure used is based upon various option-pricing models. On a quarterly basis, a sensitivity analysis is performed on our marketability discount.
|
(4)
|
We adjust the contractual remaining term of private company warrants based on our estimate of the actual remaining life, which we determine by utilizing historical data on terminations and exercises. At
December 31, 2018
, the weighted average contractual remaining term was
6.1
years, compared to our estimated remaining life of
2.7
years. On a quarterly basis, a sensitivity analysis is performed on our remaining life assumption.
|
|
|
|
|
Estimated Fair Value
|
||||||||||||||||
(Dollars in thousands)
|
|
Carrying Amount
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
3,571,539
|
|
|
$
|
3,571,539
|
|
|
$
|
3,571,539
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Held-to-maturity securities
|
|
15,487,442
|
|
|
15,188,236
|
|
|
—
|
|
|
15,188,236
|
|
|
—
|
|
|||||
Non-marketable securities not measured at net asset value
|
|
131,453
|
|
|
131,453
|
|
|
—
|
|
|
—
|
|
|
131,453
|
|
|||||
Non-marketable securities measured at net asset value
|
|
151,247
|
|
|
151,247
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net commercial loans
|
|
25,043,671
|
|
|
25,463,968
|
|
|
—
|
|
|
—
|
|
|
25,463,968
|
|
|||||
Net consumer loans
|
|
3,013,706
|
|
|
3,064,093
|
|
|
—
|
|
|
—
|
|
|
3,064,093
|
|
|||||
FHLB and Federal Reserve Bank stock
|
|
58,878
|
|
|
58,878
|
|
|
—
|
|
|
—
|
|
|
58,878
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Short-term borrowings
|
|
631,412
|
|
|
631,412
|
|
|
—
|
|
|
631,412
|
|
|
—
|
|
|||||
Non-maturity deposits (1)
|
|
49,278,174
|
|
|
49,278,174
|
|
|
49,278,174
|
|
|
—
|
|
|
—
|
|
|||||
Time deposits
|
|
50,726
|
|
|
50,337
|
|
|
—
|
|
|
50,337
|
|
|
—
|
|
|||||
3.50% Senior Notes
|
|
347,639
|
|
|
336,088
|
|
|
—
|
|
|
336,088
|
|
|
—
|
|
|||||
5.375% Senior Notes
|
|
348,826
|
|
|
361,281
|
|
|
—
|
|
|
361,281
|
|
|
—
|
|
|||||
Off-balance sheet financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commitments to extend credit
|
|
—
|
|
|
22,930
|
|
|
—
|
|
|
—
|
|
|
22,930
|
|
|||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
2,923,075
|
|
|
$
|
2,923,075
|
|
|
$
|
2,923,075
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Held-to-maturity securities
|
|
12,663,455
|
|
|
12,548,280
|
|
|
—
|
|
|
12,548,280
|
|
|
—
|
|
|||||
Non-marketable securities (cost and equity method accounting) not measured at net asset value
|
|
120,019
|
|
|
126,345
|
|
|
—
|
|
|
—
|
|
|
126,345
|
|
|||||
Non-marketable securities (cost and equity method accounting) measured at net asset value
|
|
228,399
|
|
|
331,496
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net commercial loans
|
|
20,238,247
|
|
|
20,520,623
|
|
|
—
|
|
|
—
|
|
|
20,520,623
|
|
|||||
Net consumer loans
|
|
2,613,045
|
|
|
2,593,538
|
|
|
—
|
|
|
—
|
|
|
2,593,538
|
|
|||||
FHLB and Federal Reserve Bank stock
|
|
60,020
|
|
|
60,020
|
|
|
—
|
|
|
—
|
|
|
60,020
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term borrowings
|
|
1,033,730
|
|
|
1,033,730
|
|
|
1,033,730
|
|
|
—
|
|
|
—
|
|
|||||
Non-maturity deposits (1)
|
|
44,206,929
|
|
|
44,206,929
|
|
|
44,206,929
|
|
|
—
|
|
|
—
|
|
|||||
Time deposits
|
|
47,146
|
|
|
46,885
|
|
|
—
|
|
|
46,885
|
|
|
—
|
|
|||||
3.50% Senior Notes
|
|
347,303
|
|
|
352,058
|
|
|
—
|
|
|
352,058
|
|
|
—
|
|
|||||
5.375% Senior Notes
|
|
348,189
|
|
|
374,483
|
|
|
—
|
|
|
374,483
|
|
|
—
|
|
|||||
Off-balance sheet financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commitments to extend credit
|
|
—
|
|
|
22,208
|
|
|
—
|
|
|
—
|
|
|
22,208
|
|
|
(1)
|
Includes noninterest-bearing demand deposits, interest-bearing checking accounts, money market accounts and interest-bearing sweep deposits.
|
(Dollars in thousands)
|
|
Carrying Amount
|
|
Fair Value
|
|
Unfunded Commitments
|
||||||
Non-marketable securities (fair value accounting):
|
|
|
|
|
|
|
||||||
Venture capital and private equity fund investments (1)
|
|
$
|
318,352
|
|
|
$
|
318,352
|
|
|
$
|
12,973
|
|
Non-marketable securities (equity method accounting):
|
|
|
|
|
|
|
||||||
Venture capital and private equity fund investments (2)
|
|
129,485
|
|
|
129,485
|
|
|
4,943
|
|
|||
Debt funds (2)
|
|
5,826
|
|
|
5,826
|
|
|
—
|
|
|||
Other investments (2)
|
|
15,936
|
|
|
15,936
|
|
|
886
|
|
|||
Total
|
|
$
|
469,599
|
|
|
$
|
469,599
|
|
|
$
|
18,802
|
|
|
(1)
|
Venture capital and private equity fund investments within non-marketable securities (fair value accounting) include investments made by our managed funds of funds and one of our direct venture funds (consolidated VIEs) and investments in venture capital and private equity fund investments (unconsolidated VIEs). Collectively, these investments in venture capital and private equity funds are primarily in U.S. and global technology and life science/healthcare companies. Included in the fair value and unfunded commitments of fund investments under fair value accounting are
$87.1 million
and
$4.4 million
, respectively, attributable to noncontrolling interests. It is estimated that we will receive distributions from the fund investments over the next
10
to
13
years, depending on the age of the funds and any potential extensions of terms of the funds.
|
(2)
|
Venture capital and private equity fund investments, debt funds, and other fund investments within non-marketable securities (equity method accounting) include funds that invest in or lend money to primarily U.S. and global technology and life science/healthcare companies. It is estimated that we will receive distributions from the funds over the next
5
to
8
years, depending on the age of the funds and any potential extensions of the terms of the funds.
|
21.
|
Regulatory Matters
|
|
|
Capital Ratios
|
|
Capital Amounts
|
|||||||||||||||||
(Dollars in thousands)
|
|
Actual
|
|
Well Capitalized Minimum
|
|
Adequately Capitalized Minimum
|
|
Actual
|
|
Well Capitalized Minimum
|
|
Adequately Capitalized Minimum
|
|||||||||
December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
CET 1 risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
13.41
|
%
|
|
6.5
|
%
|
|
4.5
|
%
|
|
$
|
5,167,270
|
|
|
$
|
2,504,310
|
|
|
$
|
1,733,753
|
|
Bank
|
|
12.41
|
|
|
6.5
|
|
|
4.5
|
|
|
4,604,689
|
|
|
2,411,765
|
|
|
1,669,684
|
|
|||
Tier 1 risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
13.58
|
|
|
8.0
|
|
|
6.0
|
|
|
5,231,476
|
|
|
3,082,228
|
|
|
2,311,671
|
|
|||
Bank
|
|
12.41
|
|
|
8.0
|
|
|
6.0
|
|
|
4,604,689
|
|
|
2,968,326
|
|
|
2,226,245
|
|
|||
Total risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
14.45
|
|
|
10.0
|
|
|
8.0
|
|
|
5,567,562
|
|
|
3,852,785
|
|
|
3,082,228
|
|
|||
Bank
|
|
13.32
|
|
|
10.0
|
|
|
8.0
|
|
|
4,940,776
|
|
|
3,710,408
|
|
|
2,968,326
|
|
|||
Tier 1 leverage:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
9.06
|
|
|
N/A
|
|
|
4.0
|
|
|
5,231,476
|
|
|
N/A
|
|
|
2,308,592
|
|
|||
Bank
|
|
8.10
|
|
|
5.0
|
|
|
4.0
|
|
|
4,604,689
|
|
|
2,841,139
|
|
|
2,272,912
|
|
|||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
CET 1 risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
12.78
|
%
|
|
6.5
|
%
|
|
4.5
|
%
|
|
$
|
4,182,315
|
|
|
$
|
2,127,902
|
|
|
$
|
1,473,163
|
|
Bank
|
|
12.06
|
|
|
6.5
|
|
|
4.5
|
|
|
3,787,988
|
|
|
2,041,227
|
|
|
1,413,157
|
|
|||
Tier 1 risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
12.97
|
|
|
8.0
|
|
|
6.0
|
|
|
4,246,606
|
|
|
2,618,957
|
|
|
1,964,218
|
|
|||
Bank
|
|
12.06
|
|
|
8.0
|
|
|
6.0
|
|
|
3,787,988
|
|
|
2,512,279
|
|
|
1,884,209
|
|
|||
Total risk-based capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
13.96
|
|
|
10.0
|
|
|
8.0
|
|
|
4,571,542
|
|
|
3,273,696
|
|
|
2,618,957
|
|
|||
Bank
|
|
13.04
|
|
|
10.0
|
|
|
8.0
|
|
|
4,094,782
|
|
|
3,140,349
|
|
|
2,512,279
|
|
|||
Tier 1 leverage:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
SVB Financial
|
|
8.34
|
|
|
N/A
|
|
|
4.0
|
|
|
4,246,606
|
|
|
N/A
|
|
|
2,036,138
|
|
|||
Bank
|
|
7.56
|
|
|
5.0
|
|
|
4.0
|
|
|
3,787,988
|
|
|
2,504,636
|
|
|
2,003,709
|
|
22.
|
Segment Reporting
|
•
|
Global Commercial Bank
is comprised of results from the following:
|
◦
|
Our
Commercial Bank
products and services are provided by the Bank and its subsidiaries to commercial clients primarily in the technology, life science/healthcare, and private equity/venture capital industries. The Bank provides solutions to the financial needs of commercial clients through credit, treasury management, foreign exchange, trade finance, and other services. We broadly serve clients within the U.S., as well as non-U.S. clients in key international innovation markets. In addition, the Bank and its subsidiaries offer a variety of investment services and solutions to its clients that enable them to effectively manage their assets.
|
◦
|
Our
Private Equity Division
provides banking products and services primarily to our private equity and venture capital clients.
|
◦
|
SVB
Wine
provides banking products and services to our premium wine industry clients, including vineyard development loans.
|
◦
|
SVB Analytics
previously provided equity valuation services and currently provides research for investors and companies in the global innovation economy. In September 2017, SVB Analytics sold its equity valuation services business.
|
◦
|
Debt Fund Investments
is comprised of our investments in certain debt funds in which we are a strategic investor.
|
•
|
SVB Private Bank
is the private banking division of the Bank, which provides a range of personal financial solutions for consumers. Our clients are primarily private equity/venture capital professionals and executive leaders of the innovation companies they support. We offer a customized suite of private banking services, including mortgages, home equity lines of credit, restricted stock purchase loans, capital call lines of credit and other secured and unsecured lending products, as well as cash and wealth management services.
|
•
|
SVB Capital
is the funds management business of SVBFG, which focuses primarily on venture capital investments. SVB Capital manages funds (primarily venture capital funds) on behalf of third-party limited partners and, on a more limited basis, SVB Financial Group. The SVB Capital family of funds is comprised of direct venture funds that invest in companies and funds of funds that invest in other venture capital funds. SVB Capital generates income for the Company primarily from investment returns (including carried interest allocations) and management fees.
|
(Dollars in thousands)
|
|
Global
Commercial
Bank (1)
|
|
SVB Private
Bank
|
|
SVB Capital
(1)
|
|
Other Items
(2)
|
|
Total
|
||||||||||
Year ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest income
|
|
$
|
1,623,488
|
|
|
$
|
64,902
|
|
|
$
|
23
|
|
|
$
|
205,575
|
|
|
$
|
1,893,988
|
|
Provision for credit losses
|
|
(80,953
|
)
|
|
(3,339
|
)
|
|
—
|
|
|
(3,578
|
)
|
|
(87,870
|
)
|
|||||
Noninterest income
|
|
444,647
|
|
|
2,281
|
|
|
101,181
|
|
|
196,875
|
|
|
744,984
|
|
|||||
Noninterest expense (3)
|
|
(793,159
|
)
|
|
(25,064
|
)
|
|
(22,792
|
)
|
|
(347,178
|
)
|
|
(1,188,193
|
)
|
|||||
Income before income tax expense (4)
|
|
$
|
1,194,023
|
|
|
$
|
38,780
|
|
|
$
|
78,412
|
|
|
$
|
51,694
|
|
|
$
|
1,362,909
|
|
Total average loans, net of unearned income
|
|
$
|
22,354,305
|
|
|
$
|
2,850,271
|
|
|
$
|
—
|
|
|
$
|
425,944
|
|
|
$
|
25,630,520
|
|
Total average assets (5)
|
|
53,012,381
|
|
|
2,546,904
|
|
|
380,543
|
|
|
(710,768
|
)
|
|
55,229,060
|
|
|||||
Total average deposits
|
|
46,039,570
|
|
|
1,502,308
|
|
|
—
|
|
|
533,466
|
|
|
48,075,344
|
|
|||||
Year ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest income
|
|
$
|
1,274,366
|
|
|
$
|
58,131
|
|
|
$
|
48
|
|
|
$
|
87,824
|
|
|
$
|
1,420,369
|
|
Provision for credit losses
|
|
(81,553
|
)
|
|
(4,386
|
)
|
|
—
|
|
|
(6,365
|
)
|
|
(92,304
|
)
|
|||||
Noninterest income
|
|
363,759
|
|
|
2,175
|
|
|
58,992
|
|
|
132,305
|
|
|
557,231
|
|
|||||
Noninterest expense (3)
|
|
(707,666
|
)
|
|
(17,693
|
)
|
|
(19,340
|
)
|
|
(265,956
|
)
|
|
(1,010,655
|
)
|
|||||
Income (loss) before income tax expense (4)
|
|
$
|
848,906
|
|
|
$
|
38,227
|
|
|
$
|
39,700
|
|
|
$
|
(52,192
|
)
|
|
$
|
874,641
|
|
Total average loans, net of unearned income
|
|
$
|
18,479,793
|
|
|
$
|
2,423,078
|
|
|
$
|
—
|
|
|
$
|
256,523
|
|
|
$
|
21,159,394
|
|
Total average assets (5)
|
|
46,302,350
|
|
|
2,449,763
|
|
|
325,939
|
|
|
(697,780
|
)
|
|
48,380,272
|
|
|||||
Total average deposits
|
|
41,043,731
|
|
|
1,303,542
|
|
|
—
|
|
|
397,875
|
|
|
42,745,148
|
|
|||||
Year ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest income (expense)
|
|
$
|
1,040,712
|
|
|
$
|
53,582
|
|
|
$
|
(49
|
)
|
|
$
|
56,278
|
|
|
$
|
1,150,523
|
|
Provision for credit losses
|
|
(93,885
|
)
|
|
(1,812
|
)
|
|
—
|
|
|
(10,982
|
)
|
|
(106,679
|
)
|
|||||
Noninterest income
|
|
318,366
|
|
|
2,713
|
|
|
49,365
|
|
|
86,108
|
|
|
456,552
|
|
|||||
Noninterest expense (3)
|
|
(630,655
|
)
|
|
(12,379
|
)
|
|
(15,546
|
)
|
|
(201,217
|
)
|
|
(859,797
|
)
|
|||||
Income (loss) before income tax expense (4)
|
|
$
|
634,538
|
|
|
$
|
42,104
|
|
|
$
|
33,770
|
|
|
$
|
(69,813
|
)
|
|
$
|
640,599
|
|
Total average loans, net of unearned income
|
|
$
|
16,047,545
|
|
|
$
|
2,025,381
|
|
|
$
|
—
|
|
|
$
|
210,665
|
|
|
$
|
18,283,591
|
|
Total average assets (5)
|
|
41,495,332
|
|
|
2,047,513
|
|
|
338,848
|
|
|
105,758
|
|
|
43,987,451
|
|
|||||
Total average deposits
|
|
37,301,483
|
|
|
1,133,425
|
|
|
—
|
|
|
324,151
|
|
|
38,759,059
|
|
|
(1)
|
Global Commercial Bank’s and SVB Capital’s components of net interest income, noninterest income, noninterest expense and total average assets are shown net of noncontrolling interests for all periods presented. Noncontrolling interest is included within "Other Items."
|
(2)
|
The "Other Items" column reflects the adjustments necessary to reconcile the results of the operating segments to the consolidated financial statements prepared in conformity with GAAP. Net interest income consists primarily of interest earned from our fixed income investment portfolio, net of FTP. Noninterest income consists primarily of gains on equity warrant assets and gains or losses on the sale of fixed income investments and equity securities from exercised warrant assets. Noninterest expense consists primarily of expenses associated with corporate support functions such as finance, human resources, marketing, legal and other expenses.
|
(3)
|
The Global Commercial Bank segment includes direct depreciation and amortization of
$21.8 million
,
$25.3 million
and
$24.9 million
for
2018
,
2017
and
2016
, respectively.
|
(4)
|
The internal reporting model used by management to assess segment performance does not calculate income tax expense by segment. Our effective tax rate is a reasonable approximation of the segment rates.
|
(5)
|
Total average assets equal the greater of total average assets or the sum of total average liabilities and total average stockholders’ equity for each segment to reconcile the results to the consolidated financial statements prepared in conformity with GAAP.
|
23.
|
Parent Company Only Condensed Financial Information
|
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
||||
Assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
553,049
|
|
|
$
|
457,324
|
|
Investment securities
|
|
510,836
|
|
|
485,220
|
|
||
Other assets
|
|
204,301
|
|
|
196,974
|
|
||
Investment in subsidiaries:
|
|
|
|
|
||||
Bank subsidiary
|
|
4,554,813
|
|
|
3,762,542
|
|
||
Nonbank subsidiaries
|
|
116,968
|
|
|
90,540
|
|
||
Total assets
|
|
$
|
5,939,967
|
|
|
$
|
4,992,600
|
|
|
|
|
|
|
||||
Liabilities and SVBFG stockholders’ equity:
|
|
|
|
|
||||
3.50% Senior Notes
|
|
$
|
347,639
|
|
|
$
|
347,303
|
|
5.375% Senior Notes
|
|
348,826
|
|
|
348,189
|
|
||
Other liabilities
|
|
127,293
|
|
|
117,313
|
|
||
Total liabilities
|
|
$
|
823,758
|
|
|
$
|
812,805
|
|
SVBFG stockholders’ equity
|
|
5,116,209
|
|
|
4,179,795
|
|
||
Total liabilities and SVBFG stockholders’ equity
|
|
$
|
5,939,967
|
|
|
$
|
4,992,600
|
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Interest income
|
|
$
|
3,307
|
|
|
$
|
2,077
|
|
|
$
|
690
|
|
Interest expense
|
|
(32,037
|
)
|
|
(34,932
|
)
|
|
(35,316
|
)
|
|||
Dividend income from bank subsidiary
|
|
140,000
|
|
|
90,000
|
|
|
40,000
|
|
|||
Gains on equity warrant assets, net (1)
|
|
89,142
|
|
|
54,555
|
|
|
37,892
|
|
|||
Gains on investment securities, net
|
|
13,546
|
|
|
37,132
|
|
|
20,644
|
|
|||
Fund management fees and other noninterest income (1)
|
|
26,388
|
|
|
24,613
|
|
|
21,913
|
|
|||
General and administrative expenses
|
|
(70,976
|
)
|
|
(63,077
|
)
|
|
(55,139
|
)
|
|||
Income tax (expense) benefit
|
|
(14,383
|
)
|
|
10,367
|
|
|
423
|
|
|||
Income before net income of subsidiaries
|
|
154,987
|
|
|
120,735
|
|
|
31,107
|
|
|||
Equity in undistributed net income of bank subsidiary
|
|
793,641
|
|
|
356,769
|
|
|
339,629
|
|
|||
Equity in undistributed net income of nonbank subsidiaries
|
|
25,212
|
|
|
13,002
|
|
|
11,949
|
|
|||
Net income available to common stockholders
|
|
$
|
973,840
|
|
|
$
|
490,506
|
|
|
$
|
382,685
|
|
|
(1)
|
Our consolidated statements of income for the year ended December 31, 2016 was modified from prior periods’ presentation to conform to the current period's presentation, which reflects a new line item to separately disclose net gains on equity warrant assets. In prior periods, net gains on equity warrant assets were reported as a component of net gains on derivative instruments.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income available to common stockholders
|
|
$
|
973,840
|
|
|
$
|
490,506
|
|
|
$
|
382,685
|
|
Other comprehensive (loss) income, net of tax:
|
|
|
|
|
|
|
||||||
Foreign currency translation (losses) gains
|
|
(4,107
|
)
|
|
3,769
|
|
|
3,071
|
|
|||
Changes in unrealized holding gains and losses on AFS securities
|
|
120
|
|
|
22,285
|
|
|
654
|
|
|||
Equity in other comprehensive (losses) income of bank and nonbank subsidiaries
|
|
(19,171
|
)
|
|
(50,956
|
)
|
|
4,301
|
|
|||
Reclassifications to retained earnings for the adoption of new accounting guidance (1)
|
|
(29,490
|
)
|
|
—
|
|
|
—
|
|
|||
Other comprehensive (loss) income, net of tax
|
|
(52,648
|
)
|
|
(24,902
|
)
|
|
8,026
|
|
|||
Total comprehensive income
|
|
$
|
921,192
|
|
|
$
|
465,604
|
|
|
$
|
390,711
|
|
|
(1)
|
See Note 2- "Summary of Significant Accounting Policies" of the "Notes to Consolidated Financial Statements" under Part II, Item 8 of this report for additional details.
|
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income available to common stockholders
|
|
$
|
973,840
|
|
|
$
|
490,506
|
|
|
$
|
382,685
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Gains on equity warrant assets, net
|
|
(89,142
|
)
|
|
(54,555
|
)
|
|
(37,892
|
)
|
|||
Gains on investment securities, net (1)
|
|
(13,546
|
)
|
|
(17,060
|
)
|
|
(3,106
|
)
|
|||
Distributions of earnings from investment securities (1)
|
|
47,596
|
|
|
14,015
|
|
|
3,137
|
|
|||
Net income of bank subsidiary
|
|
(933,641
|
)
|
|
(446,769
|
)
|
|
(379,629
|
)
|
|||
Net income on nonbank subsidiaries
|
|
(25,212
|
)
|
|
(13,002
|
)
|
|
(11,949
|
)
|
|||
Cash dividends from bank subsidiary
|
|
140,000
|
|
|
90,000
|
|
|
40,000
|
|
|||
Amortization of share-based compensation
|
|
45,675
|
|
|
36,900
|
|
|
35,494
|
|
|||
Decrease in other assets
|
|
51,169
|
|
|
12,959
|
|
|
35,699
|
|
|||
Increase in other liabilities
|
|
21,619
|
|
|
11,774
|
|
|
15,293
|
|
|||
Other, net
|
|
(31,024
|
)
|
|
316
|
|
|
2,999
|
|
|||
Net cash provided by operating activities
|
|
187,334
|
|
|
125,084
|
|
|
82,731
|
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
||||||
Net decrease (increase) in investment securities from purchases, sales and maturities
|
|
73,742
|
|
|
(152,015
|
)
|
|
34,055
|
|
|||
Net decrease (increase) in loans
|
|
—
|
|
|
13,337
|
|
|
(3,478
|
)
|
|||
Increase in investment in bank subsidiary
|
|
(31,292
|
)
|
|
(38,927
|
)
|
|
(14,738
|
)
|
|||
(Increase) decrease in investment in nonbank subsidiaries
|
|
(5,323
|
)
|
|
34,374
|
|
|
1,924
|
|
|||
Net cash provided by (used for) investing activities
|
|
37,127
|
|
|
(143,231
|
)
|
|
17,763
|
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
||||||
Principal payments of long-term debt
|
|
—
|
|
|
(51,546
|
)
|
|
—
|
|
|||
Proceeds from issuance of common stock, ESPP and ESOP
|
|
18,387
|
|
|
27,003
|
|
|
26,147
|
|
|||
Common stock repurchase
|
|
(147,123
|
)
|
|
—
|
|
|
—
|
|
|||
Tax effect from stock exercises (1)
|
|
—
|
|
|
—
|
|
|
(3,640
|
)
|
|||
Net cash (used for) provided by financing activities
|
|
(128,736
|
)
|
|
(24,543
|
)
|
|
22,507
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
95,725
|
|
|
(42,690
|
)
|
|
123,001
|
|
|||
Cash and cash equivalents at beginning of period
|
|
457,324
|
|
|
500,014
|
|
|
377,013
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
553,049
|
|
|
$
|
457,324
|
|
|
$
|
500,014
|
|
|
(1)
|
See Note 2- "Summary of Significant Accounting Policies" of the "Notes to Consolidated Financial Statements" under Part II, Item 8 of this report for additional details.
|
24.
|
Unaudited Quarterly Financial Data
|
|
|
Three months ended
|
||||||||||||||
(Dollars in thousands, except per share amounts)
|
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||
2018:
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
$
|
432,398
|
|
|
$
|
481,301
|
|
|
$
|
513,313
|
|
|
$
|
542,897
|
|
Interest expense
|
|
12,535
|
|
|
14,858
|
|
|
20,091
|
|
|
28,437
|
|
||||
Net interest income
|
|
419,863
|
|
|
466,443
|
|
|
493,222
|
|
|
514,460
|
|
||||
Provision for credit losses
|
|
27,972
|
|
|
29,080
|
|
|
17,174
|
|
|
13,644
|
|
||||
Noninterest income
|
|
155,518
|
|
|
192,689
|
|
|
210,070
|
|
|
186,707
|
|
||||
Noninterest expense
|
|
265,417
|
|
|
305,739
|
|
|
309,445
|
|
|
307,592
|
|
||||
Income before income tax expense
|
|
281,992
|
|
|
324,313
|
|
|
376,673
|
|
|
379,931
|
|
||||
Income tax expense
|
|
73,966
|
|
|
77,287
|
|
|
95,308
|
|
|
105,000
|
|
||||
Net income before noncontrolling interests
|
|
208,026
|
|
|
247,026
|
|
|
281,365
|
|
|
274,931
|
|
||||
Net income attributable to noncontrolling interests
|
|
(13,065
|
)
|
|
(9,228
|
)
|
|
(6,548
|
)
|
|
(8,667
|
)
|
||||
Net income available to common stockholders
|
|
$
|
194,961
|
|
|
$
|
237,798
|
|
|
$
|
274,817
|
|
|
$
|
266,264
|
|
Earnings per common share—basic
|
|
$
|
3.69
|
|
|
$
|
4.48
|
|
|
$
|
5.16
|
|
|
$
|
5.01
|
|
Earnings per common share—diluted
|
|
3.63
|
|
|
4.42
|
|
|
5.10
|
|
|
4.96
|
|
||||
2017:
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
$
|
320,926
|
|
|
$
|
353,927
|
|
|
$
|
385,271
|
|
|
$
|
405,016
|
|
Interest expense
|
|
10,933
|
|
|
11,231
|
|
|
11,297
|
|
|
11,310
|
|
||||
Net interest income
|
|
309,993
|
|
|
342,696
|
|
|
373,974
|
|
|
393,706
|
|
||||
Provision for credit losses
|
|
30,734
|
|
|
15,806
|
|
|
23,522
|
|
|
22,242
|
|
||||
Noninterest income
|
|
117,659
|
|
|
128,528
|
|
|
158,778
|
|
|
152,266
|
|
||||
Noninterest expense
|
|
237,633
|
|
|
251,246
|
|
|
257,761
|
|
|
264,015
|
|
||||
Income before income tax expense
|
|
159,285
|
|
|
204,172
|
|
|
251,469
|
|
|
259,715
|
|
||||
Income tax expense
|
|
51,405
|
|
|
71,656
|
|
|
97,351
|
|
|
135,051
|
|
||||
Net income before noncontrolling interests
|
|
107,880
|
|
|
132,516
|
|
|
154,118
|
|
|
124,664
|
|
||||
Net income attributable to noncontrolling interests
|
|
(6,397
|
)
|
|
(9,323
|
)
|
|
(5,498
|
)
|
|
(7,454
|
)
|
||||
Net income available to common stockholders
|
|
$
|
101,483
|
|
|
$
|
123,193
|
|
|
$
|
148,620
|
|
|
$
|
117,210
|
|
Earnings per common share—basic
|
|
$
|
1.94
|
|
|
$
|
2.34
|
|
|
$
|
2.82
|
|
|
$
|
2.22
|
|
Earnings per common share—diluted
|
|
1.91
|
|
|
2.32
|
|
|
2.79
|
|
|
2.19
|
|
25.
|
Legal Matters
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
(a)
|
Disclosure Controls and Procedures
|
(b)
|
Management's Report on Internal Control over Financial Reporting
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED STOCKHOLDER MATTERS
|
Plan category
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights (1)
|
|
Weighted average exercise price of outstanding options, warrants and rights
|
|
Number of securities remaining available for future issuance under equity compensation plans (2)
|
||||
Equity compensation plans approved by stockholders
|
|
679,659
|
|
|
$
|
137.19
|
|
|
3,315,727
|
|
Equity compensation plans not approved by stockholders
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
Total
|
|
679,659
|
|
|
$
|
137.19
|
|
|
3,315,727
|
|
|
(1)
|
Represents options granted under our 2006 Equity Incentive Plan. This number does not include securities to be issued for unvested restricted stock units of
597,296
shares.
|
(2)
|
Includes shares available for issuance under our 2006 Equity Incentive Plan and
1,499,218
shares available for issuance under the 1999 Employee Stock Purchase Plan. This amount excludes securities already granted under our 2006 Equity Incentive Plan (as discussed above).
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
(a)
|
Financial Statements and Exhibits:
|
|
|
Page
|
|
|
|
(1)
|
Financial Statements.
The following consolidated financial statements of the registrant and its subsidiaries are included in Part II Item 8:
|
|
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
(2)
|
Financial Statement Schedule.
The consolidated financial statements and supplementary data are contained in Part II Item 8. All schedules other than as set forth above are omitted because of the absence of the conditions under which they are required or because the required information is included in the consolidated financial statements or related notes in Part II Item 8.
|
|
|
|
|
(3)
|
Exhibits.
|
ITEM 16.
|
FORM 10-K SUMMARY
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Filed
Herewith
|
||||||
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
|||||
|
|
8-K
|
|
000-15637
|
|
3.1
|
|
May 31, 2005
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
3.2
|
|
February 20, 2019
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
4.1
|
|
September 20, 2010
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
4.2
|
|
September 20, 2010
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
4.2
|
|
January 29, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
4.2
|
|
January 29, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.28
|
|
September 20, 2004
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.2
|
|
February 27, 2014
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.4
|
|
August 7, 2008
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.1
|
|
August 8, 2016
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.7
|
|
November 6, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.1
|
|
August 7, 2018
|
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
||
|
|
8-K
|
|
000-15637
|
|
10.14
|
|
March 15, 2012
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.1
|
|
May 10, 2016
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.16
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.17
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.18
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.19
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.20
|
|
August 7, 2009
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.31
|
|
April 17, 2007
|
|
|
||
|
|
8-K/A
|
|
000-15637
|
|
10.32
|
|
May 2, 2007
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.23
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.24
|
|
November 10, 2008
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.27
|
|
November 10, 2008
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.26
|
|
August 7, 2008
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.31
|
|
May 14, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.32
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.33
|
|
August 7, 2009
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.34
|
|
August 7, 2009
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.33
|
|
February 27, 2014
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.34
|
|
February 27, 2014
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.35
|
|
February 27, 2014
|
|
|
Exhibit
Number
|
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Filed
Herewith
|
||||||
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
|||||
|
|
10-K
|
|
000-15637
|
|
10.36
|
|
February 27, 2014
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.37
|
|
February 27, 2014
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.38
|
|
February 27, 2014
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.3
|
|
May 9, 2014
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.4
|
|
May 9, 2014
|
|
|
||
|
|
10-Q
|
|
000-15637
|
|
10.5
|
|
May 9, 2014
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.2
|
|
January 9, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.3
|
|
January 9, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.4
|
|
January 9, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.5
|
|
January 9, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.6
|
|
January 9, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.7
|
|
January 9, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.8
|
|
January 9, 2015
|
|
|
||
|
|
10-K
|
|
000-15637
|
|
10.47
|
|
February 26, 2015
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.1
|
|
May 12, 2017
|
|
|
||
|
|
8-K
|
|
000-15637
|
|
10.2
|
|
May 12, 2017
|
|
|
||
|
|
|
|
|
|
|
|
|
|
X
|
||
|
|
|
|
|
|
|
|
|
|
X
|
||
|
|
|
|
|
|
|
|
|
|
X
|
||
|
|
|
|
|
|
|
|
|
|
X
|
||
|
|
|
|
|
|
|
|
|
|
X
|
||
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
|
|
X
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
X
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
*
|
Denotes management contract or any compensatory plan, contract or arrangement.
|
+
|
Forms applicable to grants made under the 2006 Equity Incentive Plan during 2013 and prior years.
|
++
|
Forms applicable to grants made under the 2006 Equity Incentive Plan during 2014.
|
+++
|
Forms applicable to grants made under the 2006 Equity Incentive Plan beginning in 2015.
|
SVB Financial Group
|
|
/s/ GREG W. BECKER
|
Greg W. Becker
|
President and Chief Executive Officer
|
Dated: February 28, 2019
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Signature
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Title
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Date
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/s/ ROGER F. DUNBAR
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Chairman of the Board of Directors and Director
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February 28, 2019
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Roger F. Dunbar
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/s/ GREG W. BECKER
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President, Chief Executive Officer and Director (Principal Executive Officer)
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February 28, 2019
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Greg W. Becker
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/s/ DANIEL J. BECK
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Chief Financial Officer (Principal Financial Officer)
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February 28, 2019
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Daniel J. Beck
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/s/ KAMRAN F. HUSAIN
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Chief Accounting Officer (Principal Accounting Officer)
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February 28, 2019
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Kamran F. Husain
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/s/ ERIC A. BENHAMOU
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Director
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February 28, 2019
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Eric A. Benhamou
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/s/ JOHN S. CLENDENING
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Director
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February 28, 2019
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John S. Clendening
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/s/ JOEL P. FRIEDMAN
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Director
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February 28, 2019
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Joel P. Friedman
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/s/ KIMBERLY A. JABAL
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Director
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February 28, 2019
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Kimberly A. Jabal
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/s/ JEFFREY N. MAGGIONCALDA
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Director
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February 28, 2019
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Jeffrey N. Maggioncalda
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/s/ MARY J. MILLER
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Director
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February 28, 2019
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Mary J. Miller
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/s/ KATE D. MITCHELL
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Director
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February 28, 2019
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Kate D. Mitchell
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/s/ JOHN F. ROBINSON
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Director
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February 28, 2019
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John F. Robinson
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/s/ GAREN K. STAGLIN
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Director
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February 28, 2019
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Garen K. Staglin
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1.1
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“Account”
means an account established for the purpose of recording amounts credited on behalf of a Participant pursuant to Article 3 and/or Employer Contributions pursuant to Article 4, and any income, expenses, gains, losses or distributions included thereon. The Account shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant pursuant to the Plan.
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1.2
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“Administrator”
means the Employer, or such other person or persons designated by the Employer to be responsible for the administration of the Plan.
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1.3
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“Base Pay”
means the basic or regular rate of per payroll period remuneration paid to the Participant by the Employer.
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1.4
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“Beneficiary”
means the persons, trusts, estates or other entities entitled under Section 7.2 to receive benefits under the Plan upon the death of a Participant.
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1.5
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“Board”
means the Compensation Committee of Board of Directors of the Plan Sponsor.
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1.6
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“Bonus”
means a bonus payment that is earned by an Eligible Employee during the Plan Year for services rendered to Employer and that the Administrator has designated as deferrable under the Plan prior to the commencement of any applicable Plan Year.
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1.7
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“Code”
means the Internal Revenue Code of 1986, as amended from time to time.
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1.8
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“Compensation”
means Base Pay and Bonus earned by an Eligible Employee during the Plan Year for services rendered to Employer as determined by the Administrator.
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1.9
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“Deferral Election”
means an election an Eligible Employee makes as provided by Section 3.1.
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1.10
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“Eligible Employee”
means an employee that Employer (a) determines to be a member of a select group of management or highly compensated employees within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, and (b) designates as an Eligible Employee for purposes of this Plan.
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1.11
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“Employer”
means SVB Financial Group and all other members of SVB Controlled Group that it designates to participate in this Plan.
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1.12
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“
Employer Contributions
” means those contributions made to the Plan by Employer into the Participant’s Account in accordance with Article 4.
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1.13
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“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time to time.
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1.14
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“Participant”
means any Eligible Employee who participates in the Plan in accordance with Article 2.
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1.15
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“Plan”
means this SVB Financial Group Deferred Compensation Plan, as set forth herein and as it may be amended from time to time.
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1.16
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“Plan Sponsor”
means SVB Financial Group.
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1.17
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“Plan Year”
means the calendar year; provided, however, that solely for purposes of Sections 3.1, 3.2 and 3.5, prior to the commencement of an applicable calendar year the Plan Administrator may determine that the Plan Year shall be a different period of roughly-equivalent time with respect to Base Pay deferral elections, which alternative period of time shall commence no sooner than the first day of the applicable calendar year, and the Plan Administrator shall timely communicate to Participants such alternative Plan Year for purposes of Participants’ Base Pay deferral elections for the alternative Plan Year. Notwithstanding the foregoing, an alternative Plan Year shall not overlap with another Plan Year.
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1.18
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“Separation from Service”
means a Participant’s death, retirement, or other termination of employment with the SVB Controlled Group. The determination of whether a Participant has terminated employment shall be determined based on the facts and circumstances in accordance with the rules set forth in Code Section 409A and the regulations thereunder. Whether a Separation from Service has occurred is based on whether the facts and circumstances indicate that the Participant and the Employer reasonably anticipated that no further services would be performed for the Employer after a certain date or that the level of bona fide services the Participant would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to less than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36-month period (or if employed by an Employer less than 36 months, such lesser period). A Participant will be deemed to have had a Separation from Service if the Participant’s level of bona fide services performed decreases to a level that is twenty percent (20%) or less of the average level of services performed by the Participant during the immediately preceding 36-month period (or if the Participant has not been employed for 36 months, such less period of employment). A Participant shall not be deemed to have Separated from Service if the Participant continues to provide services to an Employer (whether as an employee or an independent contractor) at an annual rate that is fifty percent (50%) or more of the services rendered, on average, during the immediately preceding 36 months of employment with an
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1.19
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“Special Retention Incentives”
means retention incentives offered to selected key Participants as provided in Section 3.4.
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1.20
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“Specified Employee”
means a Participant who is identified as a “specified employee” as of the date of his or her Separation from Service in accordance with the requirements of Treasury Regulation Section 1.409A-1(i).
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1.21
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“SVB Controlled Group”
means the Employers and any corporation which is a member of a controlled group of corporations (as defined in Code Section 414(b)) which includes an Employer and any trade or business (whether or not incorporated) which is under common control (as defined in Code Section 414(c)) with an Employer.
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1.22
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“Total Disability”
means total disability as determined by the Social Security Administration or other disability that complies with the requirements of Treasury Regulations Section 1.409A-3(i)(4).
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1.23
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“Valuation Date”
means each business day of the Plan Year and such other date(s) as Employer designates.
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2.1
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Participation.
Each Eligible Employee shall become a Participant in the Plan by (a) executing a Deferral Election in accordance with the provisions of Article 3, (b) receiving an Employer Contribution pursuant to Article 4 or (c) being designated as a Participant in a Special Retention Incentive.
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2.2
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Termination of Participation.
A Participant’s participation in the Plan shall cease upon his or her termination of service with the Employer for any reason or his or her ceasing to qualify as an Eligible Employee. Upon any termination of participation, a Participant’s deferrals and/or Employer Contributions, if any, shall cease but the provisions of Section 8.2 shall continue to apply.
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2.3
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Other Termination of Employment.
If the Participant’s employment is terminated prior to the end of a Special Retention Incentive Vesting Period for any reason other
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3.1
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Deferral Election.
Each Eligible Employee may elect to defer Compensation earned by him or her during a Plan Year by executing a Deferral Election in accordance with rules and procedures established by the Administrator and the provisions of this Article 3. The Deferral Election must separately specify for each type of Compensation (i.e., Base Pay and Bonus) the whole number percentage multiple that the Participant elects to defer and the timing and form of payment of the deferred amount.
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3.2
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Election to Defer Base Pay.
An Eligible Employee may elect to defer Base Pay for a Plan Year in any amount (in 1% increments) from 5% to 50% of Base Pay.
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3.3
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Election to Defer Bonus.
An Eligible Employee may elect to defer (in 1% increments) from 5% to 100% of his or her Bonus for a Plan Year.
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3.4
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Special Retention Incentives.
From time to time during the Plan Year, the Administrator, in its sole discretion, shall designate Special Retention Incentives to key employees as eligible for investment in this Plan during the retention qualifying period.
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3.5
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Timing of Election to Defer.
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3.5.1
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Base Pay
. Each Eligible Employee who desires to defer Base Pay earned during a Plan Year must execute a Deferral Election within the period preceding the Plan Year specified by the Administrator.
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3.5.2
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Bonus
. Each Eligible Employee who desires to defer a Bonus must execute a Deferral Election within the period preceding the Plan Year during which the Bonus is earned that is specified by the Administrator.
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3.5.3
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Performance-Based Compensation
. Notwithstanding the foregoing, with respect to any amounts to be contributed to the Plan for a Plan Year
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3.5.4
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Initial Year of Eligibility
. In the case of the first Plan Year in which an Employee first becomes classified or designated as an Eligible Employee, if and to the extent permitted by the Administrator, the individual may make an election no later than thirty (30) days after the date he or she becomes an Eligible Employee to defer Base Pay and/or Bonus (as applicable), for services to be performed after the election or to elect the time and form of payment of any Employer Contribution. A Deferral Election will be deemed to apply to Bonus for services performed after the election if the election applies to no more than an amount equal to the total Bonus for the performance period multiplied by the ratio of the number of days remaining in the performance period after the election over the total number of days in the performance period. This paragraph will not apply to an Employee who is a participant in any other account balance deferred compensation plans maintained by any member of the SVB Controlled Group which is required to be aggregated with this Plan under Code Section 409A.
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3.5.5
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Initial Deferral Election with Respect to Certain Forfeitable Rights
. Notwithstanding the foregoing, if an Eligible Employee has a right to a payment in a subsequent tax year that is subject to a condition requiring the Eligible Employee to perform services for the Employer for at least 12 months after the Eligible Employee obtains the legally binding right to the to avoid forfeiture of the payment (as described in Treasury Regulations Section 1.409A-2(a)(5)), the Participant may make a Deferral Election no later than 30 days after the Participant obtains the legally binding right to the payment, provided the Participant makes the election at least 12
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3.6
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Election of Payment Schedule and Form of Payment.
At the time an Eligible Employee completes a Deferral Election in accordance with Section 3.5, the Eligible Employee must separately elect the time and form of payment for each type of Compensation being deferred (i.e., for Base Pay and Bonus). To the extent permitted by the Administrator, an Eligible Employee may elect the time and form of payment of an Employer Contribution pursuant to the applicable procedures in Section 3.5.
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4.1
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Employer Contributions
. The Administrator, in its discretion, may credit additional amounts as Employer Contributions to the Account of any Eligible Employee, Participant or group of Participants. No such contribution to an Eligible Employee, Participant or group of Participants shall imply any right on the part of other Eligible Employees or Participants to receive a similar contribution, nor are such contributions required to be uniform with respect to the Participants for whom they are made.
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4.2
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Timing
. The Administrator will make any Employer Contributions under Section 4.1 for a Plan Year at such times as Code Section 409A or any other applicable laws, rules and regulations may permit.
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4.3
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Deferral Election
. To the extent permitted by the Administrator, an Eligible Employee or Participant may elect the time and form of payment of any Employer Contributions being made to the Plan on his or her behalf under Section 4.1. Any such election shall be subject to the Deferral Election rules set forth in Article 3 of the Plan. In the event that a the Participant is not permitted to elect the time and form of payment for an Employer Contribution, Employer may set the time and form of payment either before the Participant obtains the legally binding right to the payment or, if later, the date the an employee could have otherwise elected the time and form of payment under Article 3 of the Plan or as otherwise permitted in accordance with Section 409A of the Code.
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4.4
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Vesting
. The vesting rules for any amounts credited to the Participant’s Account as Employer Contributions are set forth in Section 7.1.2 of the Plan.
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4.5
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Distribution
. The distribution rules for any amounts credited to the Participant’s Account as Employer Contributions are set forth in Article 8 of the Plan.
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5.1
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Individual Accounts.
The Administrator will establish and maintain a bookkeeping Account for each Participant which will reflect deferrals made pursuant to Article 3, and Employer Contributions made pursuant to Article 4, if any, along with earnings, expenses, gains and losses credited thereto, attributable to the hypothetical investments made with the amounts in the Participant’s Account as provided in Article 6. The amount a Participant elects to defer in accordance with Article 3 shall be credited to the Participant’s Account at the time the amount subject to the Deferral Election would otherwise have been payable to the Participant but for his or her election to defer. Each Employer Contribution made pursuant to Article 4 shall be credited to a Participant’s Account on the date approved by Employer or, if the Employer has not approved a specific date, within 30 days of the date the Employer approves crediting an Employer Contribution to the Participant’s Account. The Administrator will establish and maintain such other accounts and records as it decides in its discretion to be reasonably required or appropriate to discharge its duties under the Plan.
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6.1
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Investment Options.
The amount in a Participant’s Account shall be treated as invested in the investment options designated for this purpose by the Administrator.
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6.2
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Adjustment of Accounts.
The amount in a Participant’s Account shall be adjusted for hypothetical investment earnings or losses in an amount equivalent to the gains or losses reported by the investment options selected by the Participant or Beneficiary from among the investment options provided in Section 6.1. A Participant may, in accordance with rules and procedures established by the
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7.1
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Vesting.
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7.1.1
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Vesting for Voluntary Elected Deferral Amounts.
Except as provided in Sections 7.1.2 and 7.1.3, a Participant, at all times, has a 100% nonforfeitable interest in voluntary elected deferral amounts credited to his or her Account.
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7.1.2
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Vesting for Employer Contributions
. At the time that the Administrator approves any Employer Contributions to be made to a Participant’s Account for a Plan Year, the Administrator shall also determine, in its sole discretion, whether such Employer Contributions shall be subject to a substantial risk of forfeiture and the applicable vesting period (e.g., time or performance based vesting). Unless otherwise provided by the Employer at the time of approval of an Employer Contribution on behalf of a Participant, a Participant’s Employer Contributions under the Plan will become 100% vested (nonforfeitable) upon the occurrence of any of the following events:
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7.1.4
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Vesting for Special Retention Incentives
. These awards are subject to time-based vesting requirements (and other vesting requirements as the Administrator may determine from time to time) based on the following schedule:
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Vesting Period
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Retention Incentive to Salary Multiple
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3 years
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Less than or equal to one times annual salary
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4 years
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Greater than one times annual salary and less than or equal to two times annual salary
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5 years
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Greater than two times annual salary
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7.2
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Death.
The balance or remaining balance credited to a Participant’s Account shall be paid to his or her Beneficiary in a single lump sum payment as soon as practicable following the date of death, but in no event later than the end of the year in which the death occurred or, if later, the 15
th
day of the third month immediately following the date of death. If multiple Beneficiaries have been designated, each Beneficiary shall receive a single lump sum payment of his or her specified portion of the Account as soon as practicable following the date of death, but in no event later than the end of the year in which the death occurred or, if later, the 15
th
day of the third month immediately following the date of death.
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8.1
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Amount of Benefits.
The amount credited to a Participant’s Account as determined under Articles 5 and 7 shall determine and constitute the basis for the value of benefits payable to the Participant under the Plan.
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8.2
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Method and Timing of Distributions for Voluntary Deferrals and Employer Contributions.
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8.2.1
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Method and Timing of Distributions for a Specified Plan Year.
In the event a Participant has selected a specific Plan Year to begin distribution of all or a portion of the voluntary deferrals and/or Employer Contributions (if any) credited to his or her Account, such distribution shall commence in January of the Plan Year that the Participant had elected for beginning such distribution from his or her Account, and shall be made in the form specified by the Participant in accordance with the provisions of Article 3.
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8.2.2
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Method and Timing of Distributions for Separation from Service.
Subject to Section 8.4, in the event that all or any portion of a Participant’s Account is distributable upon the Participant’s Separation from Service, such distribution shall commence in January of the first Plan Year that commences six months after the Participant’s date of Separation from Service, and shall be made in the form specified by the Participant in accordance with the provisions of Article 3.
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8.3
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Method and Timing of Distributions for Special Retention Incentives.
Distributions for Special Retention Incentive will occur as soon as administratively feasible following the vesting date specified by the Administrator, but in no event more than 60 days.
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8.4
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Cashouts of Amounts Not Exceeding $10,000.
If the amount credited to the Participant’s Account does not exceed $10,000 at the time of the Participant’s Separation from Service, the Employer may pay such amount to the Participant in a single lump sum payment as soon as practicable following such termination or cessation of service regardless of whether the Participant had made different elections of time or form of payment as to the amount credited to his or her Account or whether the Participant was receiving installments at the time of such termination. A distribution made to a Specified Employee shall not be made before the date that is six months after the date of his or her Separation from Service.
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9.1
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Amendment by Employer.
The Plan Sponsor reserves the right to amend the Plan (for itself and each Employer) through action of the Board. An amendment must be in writing and executed by an officer authorized to take such action. Each amendment shall be effective when approved by the Board. No amendment can directly or indirectly deprive any current or former Participant or Beneficiary of all or any portion of his or her Account, which had accrued prior to the amendment.
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9.2
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Retroactive Amendments.
An amendment made by the Plan Sponsor in accordance with Section 9.1 may be made effective on a date prior to the first day of the Plan Year in which it is adopted if such amendment is necessary or appropriate
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9.3
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Plan Termination.
The Plan has been adopted with the intention and expectation that it will be continued indefinitely. Each Employer, however, reserves the right to terminate the Plan with respect to its participating employees. Each Employer has no obligation or liability whatsoever to maintain the Plan for any length of time and may discontinue contributions under the Plan or terminate the Plan at any time without any liability hereunder for any such discontinuance or termination.
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9.4
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Distribution Upon Termination of the Plan.
Upon termination of the Plan, no further contributions shall be made under the Plan and if such termination meets the distribution acceleration requirements of Treasury Regulation Section 1.409A-3(j)(4)(ix), all amounts credited to each Participant’s Account shall be paid out as soon as administratively feasible in accordance with such regulations in a single lump sum payment regardless of the elections the Participant had made concerning the time and form of payment of the amounts credited to his or her Account and regardless of whether the Participant was receiving installments at the time of such Plan termination.
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10.1
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Establishment of Trust.
The Plan Sponsor may but is not required to establish a trust to hold amounts, which the Plan Sponsor may contribute from time to time to correspond to some or all amounts credited to Participants under Section 5.1. If the Plan Sponsor elects to establish a trust, the provisions of Sections 10.2 and 10.3 shall become operative.
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10.2
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Grantor Trust.
Any trust established by the Plan Sponsor shall be between the Plan Sponsor and a trustee pursuant to a separate written agreement under which assets are held, administered and managed, subject to the claims of the Plan Sponsor’s creditors in the event of the Plan Sponsor’s insolvency, until paid to the Participant and/or his or her Beneficiaries specified in the Plan. The trust is intended to be treated as a grantor trust under the Code, and the establishment of the trust shall not cause the Participant to realize current income on amounts contributed thereto.
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10.3
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Investment of Trust Funds.
Any amounts contributed to the trust by the Plan Sponsor shall be invested by the trustee in accordance with the provisions of the trust and the instructions of the Administrator. Trust investments need not reflect the hypothetical investments selected by Participants under Section 6.1 for the purpose of adjusting Accounts and the earnings or investment results of the trust
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11.1
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Acceleration of Payments Permitted Under Code Section 409A.
Notwithstanding anything in this Plan to the contrary, the Administrator may provide that a Participant will receive all or a portion of his or her Account prior to the time specified in this Plan to the extent such acceleration is permitted under Code Section 409A.
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11.2
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Unsecured General Creditor of the Employer.
Participants and their Beneficiaries, heirs, successors and assigns shall have no legal or equitable rights, interests or claims in any property or assets of the Employer. For purposes of the payment of benefits under the Plan, any and all of the Employer’s assets shall be, and shall remain, the general, unpledged, unrestricted assets of the Employer. Each Employer's obligation under the Plan shall be merely that of an unfunded and unsecured promise to pay money in the future.
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11.3
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Employer’s Liability.
Each Employer’s liability for the payment of benefits under the Plan shall be defined only by the Plan and by the Deferral Elections entered into between a Participant and the Employer. An Employer shall have no obligation or liability to a Participant under the Plan except as provided by the Plan and a Deferral Election or agreements. An Employer shall have no liability to Participants employed by other Employers.
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11.4
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Limitation of Rights.
Neither the establishment of the Plan, nor any amendment thereof, nor the creation of any fund or account, nor the payment of any benefits, will be construed as giving to the Participant or any other person any legal or equitable right against the Employer or Administrator, except as provided herein; and in no event will the terms of employment or service of the Participant be modified or in any way affected hereby.
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11.5
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Assignment of Benefits.
Except as hereinafter provided with respect to marital disputes, none of the benefits or rights of a Participant or any Beneficiary of a Participant shall be subject to the claim of any creditor. In particular, to the fullest extent permitted by law, all such benefits and rights shall be free from attachment, garnishment, or any other legal or equitable process available to any creditor of the Participant and his or her Beneficiary. Neither the Participant nor his or her Beneficiary shall have the right to alienate, anticipate, commute, pledge, encumber, or assign any of the payments which he or she may expect to receive, contingently or otherwise, under this Plan, except the right to designate a Beneficiary to receive death benefits provided hereunder. In cases of marital dispute, the Employer shall observe the terms of the Plan unless and until ordered to do otherwise by a state or Federal court. As a condition of participation, a Participant agrees to hold the
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11.6
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Facility of Payment.
If the Administrator determines, on the basis of medical reports or other evidence satisfactory to the Administrator, that the recipient of any benefit payments under the Plan is incapable of handling his or her affairs by reason of minority, illness, infirmity or other incapacity, the Administrator may direct the Employer to disburse such payments to a person or institution designated by a court which has jurisdiction over such recipient or a person or institution otherwise having the legal authority under State law for the care and control of such recipient. The receipt by such person or institution of any such payments therefore, and any such payment to the extent thereof, shall discharge the liability of the Employer for the payment of benefits hereunder to such recipient.
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11.7
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Notices.
Any notice or other communication in connection with the Plan shall be deemed delivered in writing if addressed as provided below and if either actually delivered at said address or, in the case of a letter, five business days shall have elapsed after the same shall have been deposited in the United States mails, first-class postage prepaid and registered or certified:
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(a)
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If it is sent to the Employer or Administrator, it will be at the address specified by the Employer; or
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(b)
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In each case at such address as the addressee shall have specified by written notice delivered in accordance with the foregoing to the addressor’s then effective notice address.
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11.8
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Tax Withholding.
The Employer shall have the right to deduct from all payments or deferrals made under the Plan any tax required by law to be withheld. If the Employer concludes that tax is owed with respect to any deferral or payment hereunder, the Employer shall withhold such amounts from any payments due the Participant, as permitted by law, or otherwise make appropriate arrangements with the Participant or his or her Beneficiary for satisfaction of such obligation. Tax, for purposes of this Section 11.8 means any federal, state, local or any other governmental income tax, employment or payroll tax, excise tax, or any other tax or assessment owing with respect to amounts deferred, any earnings thereon, and any payments made to Participants under the Plan.
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11.9
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Indemnification.
Each Employer shall indemnify and hold harmless each employee, officer, or director of an Employer to whom is delegated duties, responsibilities, and authority with respect to the Plan against all claims, liabilities, fines and penalties, and all expenses reasonably incurred by or imposed upon him
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11.10
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Governing Law.
The Plan will be construed, administered and enforced according to ERISA, and to the extent not preempted thereby, the laws of the State of California.
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12.1
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Powers and Responsibilities of the Administrator.
The Administrator has the full power and the full responsibility to administer the Plan in all of its details, subject, however, to the applicable requirements of ERISA. The Administrator’s powers and responsibilities include, but are not limited to, the following:
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(a)
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To make and enforce such rules and regulations as it deems necessary or proper for the efficient administration of the Plan;
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(b)
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To interpret the Plan, its interpretation thereof in good faith to be final and conclusive on all persons claiming benefits under the Plan;
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(c)
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To decide all questions concerning the Plan and the eligibility of any person to participate in the Plan;
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(d)
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To administer the claims and review procedures specified in Section 12.2;
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(e)
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To compute the amount of benefits which will be payable to any Participant, former Participant or Beneficiary in accordance with the provisions of the Plan;
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(f)
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To determine the person or persons to whom such benefits will be paid;
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(g)
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To authorize the payment of benefits;
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(h)
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To comply with the reporting and disclosure requirements of Part 1 of Subtitle B of Title I of ERISA;
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(i)
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To appoint such agents, counsel, accountants, and consultants as may be required to assist in administering the Plan;
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(j)
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By written instrument, to allocate and delegate its responsibilities, including the formation of an Administrative Committee to administer the Plan.
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12.2
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Claims and Review Procedures.
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(a)
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Claims Procedure
. If any person believes he or she is being denied any rights or benefits under the Plan, such person may file a claim in writing with the Administrator within one year of the date of the event giving rise to the claim for benefits under the Plan. If any such claim is wholly or partially denied, the Administrator will notify such person of its decision in writing. Such notification will contain (i) specific reasons for the denial, (ii) specific reference to pertinent Plan provisions, (iii) a description of any additional material or information necessary for such person to perfect such claim and an explanation of why such material or information is necessary, and (iv) information as to the steps to be taken if the person wishes to submit a request for review. Such notification will be given within 90 days after the claim is received by the Administrator (or within 180 days, if special circumstances require an extension of time for processing the claim, and if written notice of such extension and circumstances is given to such person within the initial 90-day period).
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(b)
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Review Procedure
. Within 60 days after the date on which a person receives a written notification of denial of claim, such person (or his or her duly authorized representative) may (i) file a written request with the Administrator for a review of his or her denied claim and of pertinent documents and (ii) submit written issues and comments to the Administrator. The Administrator will notify such person of its decision in writing. Such notification will be written in a manner calculated to be understood by such person and will contain specific reasons for the decision as well as specific references to pertinent Plan provisions. The decision on review will be made within 60 days after the request for review is received by the Administrator (or within 120 days, if special circumstances require an extension of time for processing the request, such as an election by the Administrator to hold a hearing, and if written notice of such extension and circumstances is given to such person within the initial 60-day period).
|
(c)
|
No action at law or equity shall be brought to recover benefits under the Plan unless the action is commenced within two (2) years after the occurrence of the loss for which a claim is made. Except as required by applicable law, no action at law or equity shall be brought to recover a benefit under the Plan unless and until the claimant has:
|
(i)
|
submitted a claim for benefits;
|
(ii)
|
been notified by the Board that the benefits (or a portion thereof) are denied;
|
(iii)
|
filed a written request for a review of denial with the Board; and
|
(iv)
|
been notified in writing that the denial has been affirmed.
|
12.3
|
Plan Administrative Costs.
All reasonable costs and expenses (including legal, accounting, and employee communication fees) incurred by the Administrator in administering the Plan shall be paid by the Employer.
|
12.4
|
Code Section 409A.
The Plan shall be interpreted and construed as necessary to comply with Code Section 409A and any regulations or other guidance promulgated thereunder. Any provision that is noncompliant with Code Section 409A is deemed amended to comply with Code Section 409A Code or if it cannot be so amended is void. The Employer does not guarantee the tax treatment of any payment or benefit under the Plan and the Participant shall at all times be responsible for any and all tax liabilities and payments related to the benefits provided hereunder.
|
Subsidiary
|
|
Jurisdiction of Incorporation or Organization
|
Gold Hill Venture Lending Partners 03, LLC
|
|
California
|
Gold Hill Venture Lending 03, LP
|
|
Delaware
|
Gold Hill Venture Lending 03-A, LP
|
|
Delaware
|
Gold Hill Venture Lending 03-B, LP
|
|
Delaware
|
Gold Hill Venture Lending 03-C, LP
|
|
Delaware
|
GHVL 03-C, Inc.
|
|
Delaware
|
GHVL, LP
|
|
Delaware
|
Silicon Valley Bank
|
|
California
|
SVB Asset Management
|
|
California
|
SVB Securities
|
|
California
|
SPD Silicon Valley Bank Co., Ltd.
|
|
China
|
SVB Wealth Advisory, Inc.
|
|
Delaware
|
SVB International Finance, Inc.
|
|
United States*
|
The Silicon Valley Bank Foundation
|
|
California
|
SVB Financial Group UK Limited
|
|
United Kingdom
|
SVB Global Financial, Inc.
|
|
Delaware
|
SVB Israel Advisors, Ltd.
|
|
Israel
|
SVB India Advisors, Pvt. Ltd.
|
|
India
|
SVB Global Services India LLP
|
|
India
|
SVB Business Partners (Beijing) Co. Ltd.
|
|
China
|
Lunar Merger Sub LLC
|
|
Delaware
|
SVB Analytics, Inc.
|
|
Delaware
|
Silicon Valley BancVentures, Inc.
|
|
California
|
CP I, L.P.
|
|
California
|
SVB Capital Partners II, LLC
|
|
Delaware
|
CP II, L.P.
|
|
Delaware
|
SVB Capital Partners III, LLC
|
|
Delaware
|
Capital Partners III, L.P.
|
|
Delaware
|
SVB Capital Partners IV, LLC
|
|
Delaware
|
Capital Partners IV, L.P.
|
|
Delaware
|
SVB Venture Capital Investment Management (Shanghai) Co. Limited
|
|
China
|
Shanghai Yangpu Venture Capital Fund (LP)
|
|
China
|
Shengwei Shengxiang Capital Hangzhou Venture Capital Fund (LP)
|
|
China
|
Qualified Investors Fund, LLC
|
|
California
|
Qualified Investors Fund II, LLC
|
|
Delaware
|
Qualified Investors Fund III, LLC
|
|
Delaware
|
Qualified Investors Fund IV, LLC
|
|
Delaware
|
Qualified Investors Fund V, LLC
|
|
Delaware
|
SVB Growth Investors, LLC
|
|
Delaware
|
Capital Preferred Return Fund, L.P.
|
|
Delaware
|
Growth Partners, L.P.
|
|
Delaware
|
SVB Strategic Investors, LLC
|
|
California
|
Strategic Investors Fund, L.P.
|
|
California
|
SVB Strategic Investors II, LLC
|
|
Delaware
|
Strategic Investors Fund II, L.P.
|
|
Delaware
|
SVB Strategic Investors III, LLC
|
|
Delaware
|
Strategic Investors Fund III, L.P.
|
|
Delaware
|
SVB Strategic Investors IV, LLC
|
|
Delaware
|
Strategic Investors Fund IV, L.P.
|
|
Delaware
|
Venture Investment Managers, L.P.
|
|
Delaware
|
SVB Strategic Investors V, LLC
|
|
Delaware
|
Strategic Investors Fund V, L.P.
|
|
Delaware
|
Strategic Investors Fund V-A, L.P
|
|
Delaware
|
Strategic Investors Fund V-A Opportunity, L.P
|
|
Delaware
|
Strategic Investors Fund V-B, L.P.
|
|
Delaware
|
SVB Strategic Investors VI, LLC
|
|
Delaware
|
Strategic Investors Fund VI, L.P.
|
|
Delaware
|
Strategic Investors Fund VI-A, L.P.
|
|
Delaware
|
SVB Strategic Investors VII, LLC
|
|
Delaware
|
Subsidiary
|
|
Jurisdiction of Incorporation or Organization
|
Strategic Investors Fund VII, L.P.
|
|
Delaware
|
Strategic Investors Fund VII-A, L.P.
|
|
Delaware
|
SVB Strategic Investors VIII, LLC
|
|
Delaware
|
Strategic Investors Fund VIII, L.P.
|
|
Delaware
|
Strategic Investors Fund VIII-A, L.P.
|
|
Delaware
|
Strategic Investors Fund VIII-B, L.P.
|
|
Delaware
|
Strategic Investors Fund VIII Cayman, L.P.
|
|
Cayman Islands
|
Strategic Investors Fund IX, LLC
|
|
Delaware
|
Strategic Investors Fund IX Cayman, L.P.
|
|
Cayman Islands
|
Strategic Investors Fund IX-A Cayman, L.P.
|
|
Cayman Islands
|
Strategic Investors Fund IX, L.P.
|
|
Delaware
|
Strategic Investors Fund IX-A, L.P.
|
|
Delaware
|
Strategic Investors Fund IX-B, L.P.
|
|
Delaware
|
Strategic Investors Fund IX Master, L.P.
|
|
Delaware
|
Sprout Endurance Partners, LLC
|
|
Delaware
|
Sprout Endurance Partners, L.P.
|
|
Delaware
|
Sprout Endurance Partners Cayman, L.P.
|
|
Cayman Islands
|
SVB Capital Venture Overage, LLC
|
|
Delaware
|
Venture Overage Fund, L.P.
|
|
Delaware
|
*
|
Edge Act Corporation
|
1.
|
I have reviewed this annual report on Form 10-K of SVB Financial Group;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the periods covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 28, 2019
|
|
/s/ GREG BECKER
|
|
|
Greg Becker
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of SVB Financial Group;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the periods covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 28, 2019
|
|
/s/ DANIEL BECK
|
|
|
Daniel Beck
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
Date: February 28, 2019
|
|
/s/ GREG BECKER
|
|
|
Greg Becker
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Date: February 28, 2019
|
|
/s/ DANIEL BECK
|
|
|
Daniel Beck
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer)
|