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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For the fiscal year ended December 31, 2011
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Commonwealth of Massachusetts
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04-2976299
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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Ten Post Office Square
Boston, Massachusetts
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02109
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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
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The NASDAQ Stock Market LLC
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Large accelerated filer
o
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Accelerated filer
x
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a Smaller reporting company)
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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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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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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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ITEM 15
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EXHIBITS
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CERTIFICATIONS
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ITEM 1.
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BUSINESS
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I.
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General
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II.
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Reportable Segments
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•
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grants the Federal Reserve increased supervisory authority and codifies the source of strength doctrine, as discussed in more detail in "-Regulation of the Company-Source of Strength" below;
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•
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establishes new corporate governance and proxy disclosure requirements, as discussed in "-Regulation of the Company-Corporate Governance and Executive Compensation" below;
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•
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provides for new capital standards applicable to the Company, as discussed in more detail in "-Capital Requirements" below;
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•
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modifies the scope and costs associated with deposit insurance coverage, as discussed in "-Regulation of the Bank-Deposit Insurance Premiums" below;
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•
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permits well capitalized and well managed banks to acquire other banks in any state, subject to certain deposit concentration limits and other conditions, as discussed in "-Regulation of the Bank-Acquisitions and Branching" below;
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•
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permits the payment of interest on business demand deposit accounts;
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•
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establishes new minimum mortgage underwriting standards for residential mortgages;
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•
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establishes the Bureau of Consumer Financial Protection (the "CFPB"), as discussed in "-Consumer Protection Regulation" below;
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•
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bars banking organizations, such as the Company, from engaging in proprietary trading and from sponsoring and investing in hedge funds and private equity funds, except as permitted under certain circumstances, as discussed in "Regulation of Other Activities-Volcker Rule Restrictions on Proprietary Trading and Sponsorship of Hedge Funds and Private Equity Funds" below;
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•
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establishes and empowers a Financial Stability Oversight Council to designate certain activities as posing a risk to the U.S. financial system and recommend new or heightened standards and safeguards for financial institutions engaging in such activities; and
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•
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authorizes the Federal Reserve to regulate interchange fees for debit card transactions. The Federal Reserve has issued a rule governing the interchange fees charged on debit cards which caps the fees a bank may charge on a debit card transactions and shifts such interchange fees from a percentage of the transaction amount to a per transaction fee. Although the rule does not directly apply to institutions with less than $10 billion in assets, market forces may result in debit card issuers of all sizes adopting fees that comply with this rule.
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IV.
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Taxation
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V.
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Internet Address
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ITEM 1A.
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RISK FACTORS
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•
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real estate developers and investors;
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•
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financial service providers;
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•
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technology companies;
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manufacturing and communications companies;
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professional service providers;
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general commercial and industrial companies; and
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individuals.
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significant adverse change in business climate;
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significant decrease in stock price and/or market capitalization;
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•
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significant unanticipated loss of clients/assets under management;
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loss of key employees;
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sustained periods of poor investment performance;
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significant loss of deposits or loans;
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significant reductions in profitability;
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significant changes in loan credit quality;
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potential sale or disposal of an affiliate; and
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adverse action or assessment by a regulator.
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Cumulative pre-tax income or loss, as adjusted for permanent book-to-tax differences, over the current and previous two years.
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Future reversals of existing taxable temporary differences.
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The projection of future taxable income to be generated by operations during the available loss carryforward period.
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Tax planning strategies that are available and whether any are limited based upon the Company's market capitalization in excess of its book value.
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Whether there has been any operating loss or tax credit carry-overs expiring unused.
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quarterly variations in our operating results or the quality of our assets;
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operating results that vary from the expectations of management, securities analysts and investors;
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changes in expectations as to our future financial performance;
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•
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announcements of innovations, new products, strategic developments, significant contracts, acquisitions and other material events by us or our competitors;
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•
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the operating and securities price performance of other companies that investors believe are comparable to us;
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our past and future dividend practices;
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future sales of our equity or equity-related securities; and
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changes in global financial markets and global economies and general market conditions, such as interest rates, stock, commodity or real estate valuations or volatility.
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
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ITEM 2.
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PROPERTIES
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ITEM 3.
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LEGAL PROCEEDINGS
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ITEM 4.
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MINE SAFETY DISCLOSURES
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ITEM 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES
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I.
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Market for Common Stock
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High
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Low
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Fiscal year ended December 31, 2011
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Fourth Quarter
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$
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8.40
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$
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5.58
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Third Quarter
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7.14
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5.23
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Second Quarter
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7.48
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5.86
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First Quarter
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7.55
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6.17
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Fiscal year ended December 31, 2010
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Fourth Quarter
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$
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7.26
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$
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4.67
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Third Quarter
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7.43
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5.73
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Second Quarter
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8.97
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5.62
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First Quarter
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8.36
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5.52
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II.
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Dividends
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III.
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Securities Authorized for Issuance Under Equity Compensation Plans
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IV.
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Recent Sales of Unregistered Securities
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V.
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Issuer Repurchases
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VI.
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Performance Graph
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Year Ending December 31,
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2006
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2007
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2008
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2009
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2010
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2011
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BPFH
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$
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100.00
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$
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97.24
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$
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24.98
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$
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21.25
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$
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24.27
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$
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29.60
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NASDAQ Composite
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100.00
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110.66
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66.42
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96.54
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114.06
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113.16
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SNL Bank $5B-$10B
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100.00
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80.20
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70.36
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54.09
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58.68
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58.23
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ITEM 6.
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SELECTED FINANCIAL DATA
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2011
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2010
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2009
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2008 (1)
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2007
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At December 31:
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(In thousands, except share data)
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Total balance sheet assets
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$
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6,048,372
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$
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6,152,901
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$
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6,049,265
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$
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7,282,835
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$
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6,940,829
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Assets of discontinued operations
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—
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—
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—
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1,578,170
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1,663,893
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Total loans (excluding loans held for sale)
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4,650,228
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4,480,347
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4,307,040
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4,129,081
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4,003,291
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Allowance for loan losses
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96,114
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98,403
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68,444
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64,091
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59,933
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Cash and investments
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1,095,197
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1,338,238
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1,387,483
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1,132,290
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842,335
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Goodwill and intangible assets
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145,600
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151,212
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150,117
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155,051
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276,912
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Deposits
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4,530,411
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4,486,726
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4,255,219
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3,748,912
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3,550,499
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Borrowed funds
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834,671
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1,027,925
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992,034
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1,329,898
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1,273,945
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Total shareholders’ equity
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566,125
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518,878
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651,154
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648,676
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619,372
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Nonperforming assets
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73,212
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119,916
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106,938
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76,828
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35,301
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Net loans (charged-off)/recoveries
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(15,449
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)
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(57,219
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)
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(40,606
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)
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(192,485
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)
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478
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Assets under management and advisory (2):
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Private Banking
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$
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3,571,000
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$
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3,592,000
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$
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3,479,000
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$
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3,253,000
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$
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3,656,000
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Investment Management
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7,594,000
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8,140,000
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7,048,000
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6,381,000
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9,115,000
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Wealth Advisory
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7,979,000
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7,836,000
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7,161,000
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6,235,000
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6,412,000
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Inter-company relationships
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(19,000
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)
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(19,000
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)
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(18,000
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)
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(16,000
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)
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—
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|||||
Total assets under management and advisory
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$
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19,125,000
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$
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19,549,000
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$
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17,670,000
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$
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15,853,000
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$
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19,183,000
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For The Year Ended December 31:
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Net interest income
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$
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178,944
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$
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180,725
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$
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159,485
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$
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150,228
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$
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136,993
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Provision for loan losses
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13,160
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87,178
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44,959
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196,643
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23,449
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|||||
Net interest income/(loss) after provision for loan losses
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165,784
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93,547
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114,526
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(46,415
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)
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|
113,544
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|||||
Fees and other income
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124,970
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|
111,772
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126,449
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129,449
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106,204
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|||||
Operating expense
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232,078
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|
236,855
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|
|
221,259
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|
|
213,785
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|
|
184,626
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|||||
Restructuring expense
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8,055
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—
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—
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—
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—
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|||||
Impairment of goodwill and intangibles
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—
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—
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1,699
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133,202
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31,780
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Income/(loss) from continuing operations before income taxes
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50,621
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(31,536
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)
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18,017
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(263,953
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)
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3,342
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|
|||||
Income tax expense/ (benefit)
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14,367
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(19,451
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)
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1,632
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(70,737
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)
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(6,339
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)
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|||||
Net income/(loss) from continuing operations
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36,254
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(12,085
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)
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16,385
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(193,216
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)
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9,681
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Net income/ (loss) from discontinued operations
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6,099
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3,729
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(7,505
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)
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(191,209
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)
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(1,524
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)
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Less: Net income attributable to noncontrolling interests
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3,216
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|
|
2,614
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|
|
3,649
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|
|
4,327
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|
|
3,987
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|
|||||
Net income/(loss) attributable to the Company
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$
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39,137
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$
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(10,970
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)
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$
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5,231
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$
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(388,752
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)
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$
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4,170
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(Continued)
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2011
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2010
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2009
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2008 (1)
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2007
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At December 31:
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(In thousands, except share data)
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Per Share Data:
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Basic earnings/ (loss) per share from continuing operations
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$
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0.43
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$
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(0.34
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)
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$
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(0.41
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)
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$
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(4.85
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)
|
|
$
|
0.15
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|
Diluted earnings/ (loss) per share from continuing operations
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$
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0.39
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|
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$
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(0.34
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)
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|
$
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(0.41
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)
|
|
$
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(4.85
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)
|
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$
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0.15
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|
Weighted average basic common shares outstanding
|
75,169,611
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|
|
71,321,162
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|
|
66,696,977
|
|
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47,528,418
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|
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36,731,621
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Weighted average diluted common shares outstanding
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83,451,422
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|
|
71,321,162
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|
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66,696,977
|
|
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47,528,418
|
|
|
38,315,330
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|
|||||
Cash dividends per share
|
$
|
0.04
|
|
|
$
|
0.04
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|
|
$
|
0.04
|
|
|
$
|
0.22
|
|
|
$
|
0.36
|
|
Book value per share (3)
|
$
|
6.51
|
|
|
$
|
6.04
|
|
|
$
|
6.51
|
|
|
$
|
7.36
|
|
|
$
|
16.53
|
|
Selected Operating Ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Return/ (loss) on average assets
|
0.64
|
%
|
|
(0.18
|
)%
|
|
0.09
|
%
|
|
(2.79
|
)%
|
|
0.07
|
%
|
|||||
Return/ (loss) on average equity
|
7.27
|
%
|
|
(1.91
|
)%
|
|
0.81
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%
|
|
(30.93
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)%
|
|
0.71
|
%
|
|||||
Net interest margin (4)
|
3.25
|
%
|
|
3.30
|
%
|
|
3.09
|
%
|
|
3.14
|
%
|
|
3.43
|
%
|
|||||
Total fees and other income/total revenue (5)
|
41.12
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%
|
|
38.21
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%
|
|
44.22
|
%
|
|
46.29
|
%
|
|
43.67
|
%
|
|||||
Asset Quality Ratios:
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|
|
|
|
|
|
|
|
|
||||||||||
Nonaccrual loans (excluding loans held for sale) to total loans (excluding loans held for sale)
|
1.46
|
%
|
|
2.35
|
%
|
|
2.01
|
%
|
|
0.89
|
%
|
|
0.85
|
%
|
|||||
Nonperforming assets to total assets
|
1.21
|
%
|
|
1.95
|
%
|
|
1.77
|
%
|
|
1.05
|
%
|
|
0.51
|
%
|
|||||
Allowance for loan losses to total loans (excluding loans held for sale)
|
2.07
|
%
|
|
2.20
|
%
|
|
1.59
|
%
|
|
1.55
|
%
|
|
1.50
|
%
|
|||||
Allowance for loan losses to nonaccrual loans (excluding loans held for sale)
|
1.41
|
|
|
0.93
|
|
|
0.79
|
|
|
1.74
|
|
|
1.76
|
|
|||||
Allowance for loan losses to classified loans (excluding loans held for sale) (6)
|
0.58
|
|
|
0.48
|
|
|
0.49
|
|
|
1.01
|
|
|
0.63
|
|
|||||
Other Ratios:
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividend payout ratio
|
8.70
|
%
|
|
nm
|
|
|
nm
|
|
|
nm
|
|
|
nm
|
|
|||||
Total equity to total assets ratio
|
9.36
|
%
|
|
8.43
|
%
|
|
10.76
|
%
|
|
8.91
|
%
|
|
8.92
|
%
|
|||||
Tangible common equity to tangible assets ratio (7)
|
7.37
|
%
|
|
6.34
|
%
|
|
6.66
|
%
|
|
5.07
|
%
|
|
3.15
|
%
|
(1)
|
Earnings for 2008 were reduced by $115.3 million, or $2.43 per share, for the after tax and noncontrolling interest impact of impairment charges at FPB, Charter, DGHM and the Holding Company; and by $124.3 million, or $2.61 per share, for the after tax provisions for loan losses. These charges were slightly offset by the gains recognized, net of tax, of $14.2 million, or $0.30 per share, from the repurchase of the Company's 3% Contingent Convertible Senior Notes due 2027. To determine net of tax amounts, an assumed effective tax rate of approximately 37% is used, except for the non-deductible impairment at the Private Banking affiliates and portions of the impairment at DGHM.
|
(2)
|
The Company changed the accounting for its interest in BOS from the equity method to the consolidation method as a result of the majority interest ownership of BOS in the third quarter of 2007.
|
(3)
|
Book value per share is calculated by reducing the Company's total equity by the preferred stock balance, then dividing that value by the total common shares outstanding as of the end of that period.
|
(4)
|
Net interest margin represents net interest income on a fully-taxable equivalent basis as a percent of average interest-earning assets.
|
(5)
|
Total revenue is defined as net interest income plus fees and other income.
|
(6)
|
Classified loans are defined as loans whose credit quality is substandard.
|
(7)
|
The Company calculates tangible assets by adjusting total assets to exclude goodwill and intangible assets. The Company calculates tangible common equity by adjusting total shareholders' equity to exclude the equity from the TARP funding of $154 million, goodwill, and intangible assets, and to include the difference between maximum redemption value and value per Accounting Research Bulletin 51,
Consolidated Financial Statements
(“ARB 51”) for redeemable non-controlling interests. The Company uses certain non-GAAP financial measures, such as the Tangible Common Equity to Tangible Assets ratio, to provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial sector. A reconciliation from the Company's GAAP Total Shareholders' Equity to Total Assets ratio to the Non-GAAP Tangible Common Equity to Tangible Assets ratio is presented below:
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
||||||||||
Total balance sheet assets
|
$
|
6,048,372
|
|
|
$
|
6,152,901
|
|
|
$
|
6,049,265
|
|
|
$
|
7,282,835
|
|
|
$
|
6,940,829
|
|
LESS: Goodwill and intangible assets, net (a)
|
(145,600
|
)
|
|
(151,212
|
)
|
|
(150,117
|
)
|
|
(178,543
|
)
|
|
(458,238
|
)
|
|||||
Tangible assets (non-GAAP)
|
$
|
5,902,772
|
|
|
$
|
6,001,689
|
|
|
$
|
5,899,148
|
|
|
$
|
7,104,292
|
|
|
$
|
6,482,591
|
|
Total shareholders’ equity
|
$
|
566,125
|
|
|
$
|
518,878
|
|
|
$
|
651,154
|
|
|
$
|
648,676
|
|
|
$
|
619,372
|
|
LESS: Goodwill and intangible assets, net (a)
|
(145,600
|
)
|
|
(151,212
|
)
|
|
(150,117
|
)
|
|
(178,543
|
)
|
|
(458,238
|
)
|
|||||
TARP Funding
|
—
|
|
|
—
|
|
|
(154,000
|
)
|
|
(154,000
|
)
|
|
—
|
|
|||||
ADD: Difference between maximum redemption value of non-controlling interests and value under ARB 51
|
14,381
|
|
|
12,578
|
|
|
46,016
|
|
|
43,800
|
|
|
43,091
|
|
|||||
Total adjustments
|
(131,219
|
)
|
|
(138,634
|
)
|
|
(258,101
|
)
|
|
(288,743
|
)
|
|
(415,147
|
)
|
|||||
Tangible Common Equity (non-GAAP)
|
$
|
434,906
|
|
|
$
|
380,244
|
|
|
$
|
393,053
|
|
|
$
|
359,933
|
|
|
$
|
204,225
|
|
Total Equity/Total Assets
|
9.36
|
%
|
|
8.43
|
%
|
|
10.76
|
%
|
|
8.91
|
%
|
|
8.92
|
%
|
|||||
Tangible Common Equity/Tangible Assets (non-GAAP)
|
7.37
|
%
|
|
6.34
|
%
|
|
6.66
|
%
|
|
5.07
|
%
|
|
3.15
|
%
|
(a)
|
Includes goodwill and intangible assets of divested affiliates for years 2008 —
2007
.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
▪
|
Improving asset quality, as seen in the
$13.2 million
provision for loan losses, down 85% from the 2010 provision of
$87.2 million
, and in the decrease in nonaccrual loans, which are down 35% from the end of 2010. The 2011 provision for loan losses reflects net new loan growth including the mix of loans, changes in loan grades, valuations of impaired loans, changes in specific reserves and charge-offs. Charge-offs for 2011 were $27.4 million, offset by recoveries of $12.0 million, compared to charge-offs of $66.7 million and recoveries of $9.5 million in 2010. Loan growth during 2011 was 4%, and the decrease in classified loans during the year was $38.2 million, or 19%.
|
▪
|
The legal consolidation of our four private banks. On May 27, 2011, Boston Private Bank merged, as the surviving bank, with Borel, FPB, and Charter. The Bank operates primarily in four geographic markets: New England, San Francisco Bay, Southern California, and the Pacific Northwest. The Company believes the legal consolidation will result in a number of benefits, including increased client service capabilities, simplified regulatory oversight, improved capital efficiency and enhanced risk management. Restructuring charges related to the merger generally consist of severance charges, costs to terminate contracts, legal and consulting costs, and other costs. The Company estimates that such charges will result in approximately $8.5 million in restructuring expense, of which
$8.1 million
was expensed in 2011.
|
▪
|
Strong performance in our fee-based business, which includes investment management and trust fees, wealth advisory fees, and other banking fees. Fee income in 2011 increased $6.0 million, or 6%, to $109.5 million, compared to $103.5 million in 2010. The fee increase is primarily due to the steady growth in our Wealth Advisory segment and the favorable equity market conditions at the end of 2010 and the beginning of 2011.
|
▪
|
Improved Holding Company performance, where 2011 had expense savings of $2.7 million in interest expense on borrowings, $1.1 million in lower compensation expense, and $2.2 million in lower professional fees, all as compared to 2010. The Holding Company also provided $4.2 million in gain on retirement of debt and $0.5 million from the gain on sale of Coldstream.
|
▪
|
The low interest rate environment caused overall asset yields to decline, which was slightly offset by decreased cost of funds spread across both deposits and borrowings. The Company's net interest margin (“NIM”) decreased 5 basis points to
3.25%
from
3.30%
for the years ended December 31, 2011 and 2010, respectively. During the second half of 2011 the Company's net interest margin declined 12 basis points from 3.29% for the three months ended June 30, 2011 to 3.17% for the three months ended December 31, 2011. Spreads could continue to tighten if asset cash flows continue to adjust lower and funding cost relief becomes limited. However, consistent loan growth could help offset some of these pressures.
|
|
As of and for the year ended December 31,
|
|
2011 vs. 2010
|
|
2010 vs. 2009
|
||||||||||||||||||||
|
2011
|
|
2010
|
|
2009
|
|
$ Change
|
|
%
|
|
$ Change
|
|
%
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||
Net interest income
|
$
|
186,006
|
|
|
$
|
190,104
|
|
|
$
|
169,802
|
|
|
$
|
(4,098
|
)
|
|
(2
|
)%
|
|
$
|
20,302
|
|
|
12
|
%
|
Fees and other income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment management and trust fees
|
23,553
|
|
|
23,257
|
|
|
21,507
|
|
|
296
|
|
|
1
|
%
|
|
1,750
|
|
|
8
|
%
|
|||||
Other income
|
15,185
|
|
|
12,827
|
|
|
17,014
|
|
|
2,358
|
|
|
18
|
%
|
|
(4,187
|
)
|
|
(25
|
)%
|
|||||
Total fees and other income
|
38,738
|
|
|
36,084
|
|
|
38,521
|
|
|
2,654
|
|
|
7
|
%
|
|
(2,437
|
)
|
|
(6
|
)%
|
|||||
Total revenues
|
224,744
|
|
|
226,188
|
|
|
208,323
|
|
|
(1,444
|
)
|
|
(1
|
)%
|
|
17,865
|
|
|
9
|
%
|
|||||
Provision for loan losses
|
13,160
|
|
|
87,178
|
|
|
44,959
|
|
|
(74,018
|
)
|
|
(85
|
)%
|
|
42,219
|
|
|
94
|
%
|
|||||
Operating expenses
|
146,322
|
|
|
149,996
|
|
|
144,713
|
|
|
(3,674
|
)
|
|
(2
|
)%
|
|
5,283
|
|
|
4
|
%
|
|||||
Restructuring expense
|
5,446
|
|
|
—
|
|
|
—
|
|
|
5,446
|
|
|
nm
|
|
|
—
|
|
|
nm
|
|
|||||
Income/ (loss) before income taxes
|
59,816
|
|
|
(10,986
|
)
|
|
18,651
|
|
|
70,802
|
|
|
nm
|
|
|
(29,637
|
)
|
|
nm
|
|
|||||
Income tax expense/ (benefit)
|
19,697
|
|
|
(10,219
|
)
|
|
4,746
|
|
|
29,916
|
|
|
nm
|
|
|
(14,965
|
)
|
|
nm
|
|
|||||
Net income/ (loss) attributable to the Company
|
$
|
40,119
|
|
|
$
|
(767
|
)
|
|
$
|
13,905
|
|
|
$
|
40,886
|
|
|
nm
|
|
|
$
|
(14,672
|
)
|
|
nm
|
|
Total loans(1)
|
$
|
4,648,759
|
|
|
$
|
4,478,428
|
|
|
$
|
4,304,110
|
|
|
$
|
170,331
|
|
|
4
|
%
|
|
$
|
174,318
|
|
|
4
|
%
|
Assets
|
$
|
5,843,089
|
|
|
$
|
5,948,100
|
|
|
$
|
5,669,645
|
|
|
$
|
(105,011
|
)
|
|
(2
|
)%
|
|
$
|
278,455
|
|
|
5
|
%
|
Deposits(2)
|
$
|
4,639,169
|
|
|
$
|
4,598,911
|
|
|
$
|
4,368,780
|
|
|
$
|
40,258
|
|
|
1
|
%
|
|
$
|
230,131
|
|
|
5
|
%
|
Assets Under Management
|
$
|
3,571,000
|
|
|
$
|
3,592,000
|
|
|
$
|
3,479,000
|
|
|
$
|
(21,000
|
)
|
|
(1
|
)%
|
|
$
|
113,000
|
|
|
3
|
%
|
(1)
|
Loans presented in this table are loans from the Private Banking segment and do not include loans of non-banking affiliates or the Holding Company.
|
(2)
|
Deposits presented in this table do not include intercompany eliminations related to deposits in the Bank from non-banking affiliates or the Holding Company.
|
|
As of and for the year ended December 31,
|
|
2011 vs. 2010
|
|
2010 vs. 2009
|
||||||||||||||||||||
|
2011
|
|
2010
|
|
2009
|
|
$ Change
|
|
%
|
|
$ Change
|
|
%
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||
Investment management and trust fees
|
$
|
39,802
|
|
|
$
|
36,942
|
|
|
$
|
33,189
|
|
|
$
|
2,860
|
|
|
8
|
%
|
|
$
|
3,753
|
|
|
11
|
%
|
Other income and net interest income
|
74
|
|
|
178
|
|
|
180
|
|
|
(104
|
)
|
|
(58
|
)%
|
|
(2
|
)
|
|
(1
|
)%
|
|||||
Total revenues
|
39,876
|
|
|
37,120
|
|
|
33,369
|
|
|
2,756
|
|
|
7
|
%
|
|
3,751
|
|
|
11
|
%
|
|||||
Operating expenses
|
31,181
|
|
|
29,720
|
|
|
28,221
|
|
|
1,461
|
|
|
5
|
%
|
|
1,499
|
|
|
5
|
%
|
|||||
Income/ (loss) before income taxes
|
8,695
|
|
|
7,400
|
|
|
5,148
|
|
|
1,295
|
|
|
18
|
%
|
|
2,252
|
|
|
44
|
%
|
|||||
Income tax expense/ (benefit)
|
2,803
|
|
|
2,682
|
|
|
2,236
|
|
|
121
|
|
|
5
|
%
|
|
446
|
|
|
20
|
%
|
|||||
Noncontrolling interests
|
1,727
|
|
|
1,383
|
|
|
997
|
|
|
344
|
|
|
25
|
%
|
|
386
|
|
|
39
|
%
|
|||||
Net income/ (loss) attributable to the Company
|
$
|
4,165
|
|
|
$
|
3,335
|
|
|
$
|
1,915
|
|
|
$
|
830
|
|
|
25
|
%
|
|
$
|
1,420
|
|
|
74
|
%
|
Assets
|
$
|
105,629
|
|
|
$
|
114,614
|
|
|
$
|
112,497
|
|
|
$
|
(8,985
|
)
|
|
(8
|
)%
|
|
$
|
2,117
|
|
|
2
|
%
|
Assets Under Management
|
$
|
7,594,000
|
|
|
$
|
8,140,000
|
|
|
$
|
7,048,000
|
|
|
$
|
(546,000
|
)
|
|
(7
|
)%
|
|
$
|
1,092,000
|
|
|
15
|
%
|
|
As of and for the year ended December 31,
|
|
2011 vs. 2010
|
|
2010 vs. 2009
|
||||||||||||||||||||
|
2011
|
|
2010
|
|
2009
|
|
$ Change
|
|
%
|
|
$ Change
|
|
%
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||
Wealth advisory fees
|
$
|
41,082
|
|
|
$
|
37,874
|
|
|
$
|
34,834
|
|
|
$
|
3,208
|
|
|
8
|
%
|
|
$
|
3,040
|
|
|
9
|
%
|
Other income and net interest income
|
17
|
|
|
(9
|
)
|
|
46
|
|
|
26
|
|
|
nm
|
|
|
(55
|
)
|
|
nm
|
|
|||||
Total revenues
|
41,099
|
|
|
37,865
|
|
|
34,880
|
|
|
3,234
|
|
|
9
|
%
|
|
2,985
|
|
|
9
|
%
|
|||||
Operating expenses
|
31,472
|
|
|
29,899
|
|
|
24,156
|
|
|
1,573
|
|
|
5
|
%
|
|
5,743
|
|
|
24
|
%
|
|||||
Impairment of goodwill and intangibles
|
—
|
|
|
—
|
|
|
1,699
|
|
|
—
|
|
|
nm
|
|
|
(1,699
|
)
|
|
(100
|
)%
|
|||||
Income/ (loss) before income taxes
|
9,627
|
|
|
7,966
|
|
|
9,025
|
|
|
1,661
|
|
|
21
|
%
|
|
(1,059
|
)
|
|
(12
|
)%
|
|||||
Income tax expense
|
3,526
|
|
|
2,982
|
|
|
3,573
|
|
|
544
|
|
|
18
|
%
|
|
(591
|
)
|
|
(17
|
)%
|
|||||
Noncontrolling interests
|
1,489
|
|
|
1,231
|
|
|
2,652
|
|
|
258
|
|
|
21
|
%
|
|
(1,421
|
)
|
|
(54
|
)%
|
|||||
Net income/ (loss) attributable to the Company
|
$
|
4,612
|
|
|
$
|
3,753
|
|
|
$
|
2,800
|
|
|
$
|
859
|
|
|
23
|
%
|
|
$
|
953
|
|
|
34
|
%
|
Assets
|
$
|
80,762
|
|
|
$
|
76,774
|
|
|
$
|
72,062
|
|
|
$
|
3,988
|
|
|
5
|
%
|
|
$
|
4,712
|
|
|
7
|
%
|
Assets Under Management
|
$
|
7,979,000
|
|
|
$
|
7,836,000
|
|
|
$
|
7,161,000
|
|
|
$
|
143,000
|
|
|
2
|
%
|
|
$
|
675,000
|
|
|
9
|
%
|
•
|
Volume and severity of past due, nonaccrual, and adversely graded loans,
|
•
|
Volume and terms of loans,
|
•
|
Concentrations of credit,
|
•
|
Management's experience, as well as loan underwriting and loan review policy and procedures, and
|
•
|
Economic and business conditions impacting the Bank's loan portfolio, as well as consideration of collateral values and external factors
|
▪
|
Cumulative pre-tax income, as adjusted for permanent book-to-tax differences, during the 2009 through 2011 period.
|
▪
|
Deferred tax assets are expected to reverse in periods when there will be taxable income.
|
▪
|
The Company projects sufficient future taxable income to be generated by operations during the available carryforward period.
|
▪
|
Certain tax planning strategies are available, such as reducing investments in tax-exempt securities.
|
▪
|
The Company has not had any operating loss or tax credit carry-overs expiring unused in recent years.
|
|
Year ended December 31,
|
|
2011 vs. 2010
|
|
2010 vs. 2009
|
||||||||||||||||||||
|
2011
|
|
2010
|
|
2009
|
|
$ Change
|
|
%
|
|
$ Change
|
|
%
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||
Net interest income
|
$
|
178,944
|
|
|
$
|
180,725
|
|
|
$
|
159,485
|
|
|
$
|
(1,781
|
)
|
|
(1
|
)%
|
|
$
|
21,240
|
|
|
13
|
%
|
Provision for loan losses
|
13,160
|
|
|
87,178
|
|
|
44,959
|
|
|
74,018
|
|
|
85
|
%
|
|
(42,219
|
)
|
|
(94
|
)%
|
|||||
Fees and other income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment management and trust fees
|
63,356
|
|
|
60,198
|
|
|
54,697
|
|
|
3,158
|
|
|
5
|
%
|
|
5,501
|
|
|
10
|
%
|
|||||
Wealth advisory fees
|
41,082
|
|
|
37,874
|
|
|
34,834
|
|
|
3,208
|
|
|
8
|
%
|
|
3,040
|
|
|
9
|
%
|
|||||
Other income
|
20,532
|
|
|
13,700
|
|
|
36,918
|
|
|
6,832
|
|
|
50
|
%
|
|
(23,218
|
)
|
|
(63
|
)%
|
|||||
Total fees and other income
|
124,970
|
|
|
111,772
|
|
|
126,449
|
|
|
13,198
|
|
|
12
|
%
|
|
(14,677
|
)
|
|
(12
|
)%
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating expenses
|
232,078
|
|
|
236,855
|
|
|
221,259
|
|
|
(4,777
|
)
|
|
(2
|
)%
|
|
15,596
|
|
|
7
|
%
|
|||||
Restructuring expense
|
8,055
|
|
|
—
|
|
|
—
|
|
|
8,055
|
|
|
nm
|
|
|
—
|
|
|
—
|
%
|
|||||
Impairment of goodwill and intangibles
|
—
|
|
|
—
|
|
|
1,699
|
|
|
—
|
|
|
—
|
%
|
|
(1,699
|
)
|
|
(100
|
)%
|
|||||
Total expenses
|
240,133
|
|
|
236,855
|
|
|
222,958
|
|
|
3,278
|
|
|
1
|
%
|
|
13,897
|
|
|
6
|
%
|
|||||
Income/ (loss) before income taxes
|
50,621
|
|
|
(31,536
|
)
|
|
18,017
|
|
|
82,157
|
|
|
nm
|
|
|
(49,553
|
)
|
|
nm
|
|
|||||
Income tax expense/ (benefit)
|
14,367
|
|
|
(19,451
|
)
|
|
1,632
|
|
|
33,818
|
|
|
nm
|
|
|
(21,083
|
)
|
|
nm
|
|
|||||
Net income/ (loss) from continuing operations
|
36,254
|
|
|
(12,085
|
)
|
|
16,385
|
|
|
48,339
|
|
|
nm
|
|
|
(28,470
|
)
|
|
nm
|
|
|||||
Net income/ (loss) from discontinued operations
|
6,099
|
|
|
3,729
|
|
|
(7,505
|
)
|
|
2,370
|
|
|
64
|
%
|
|
11,234
|
|
|
nm
|
|
|||||
Less: Net income/ (loss) attributable to noncontrolling interests
|
3,216
|
|
|
2,614
|
|
|
3,649
|
|
|
602
|
|
|
23
|
%
|
|
(1,035
|
)
|
|
(28
|
)%
|
|||||
Net income/ (loss) attributable to the Company
|
$
|
39,137
|
|
|
$
|
(10,970
|
)
|
|
$
|
5,231
|
|
|
$
|
50,107
|
|
|
nm
|
|
|
$
|
(16,201
|
)
|
|
nm
|
|
(1)
|
Interest income on non-taxable investments and loans is presented on a FTE basis using the federal statutory rate of 35% for each year presented. The discussion following this table reflects non-FTE data.
|
(2)
|
Includes loans held for sale and nonaccrual loans.
|
(3)
|
Assets and liabilities of discontinued operations are included in other assets in the 2009 average balance sheet above. Interest income, interest expense and average yields/ rates exclude discontinued operations.
|
(4)
|
Unrealized gains and losses on investment securities are included in other assets in the average balance sheets above.
|
|
2011 vs. 2010
|
|
2010 vs. 2009
|
||||||||||||||||||||
Change Due To
|
|
Change Due To
|
|||||||||||||||||||||
Rate
|
|
Volume
|
|
Total
|
|
Rate
|
|
Volume
|
|
Total
|
|||||||||||||
(In thousands)
|
|||||||||||||||||||||||
Interest income on interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and investments (1)
|
$
|
(2,923
|
)
|
|
$
|
2
|
|
|
$
|
(2,921
|
)
|
|
$
|
(9,496
|
)
|
|
$
|
2,855
|
|
|
$
|
(6,641
|
)
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial and construction (1)
|
(5,681
|
)
|
|
(8,899
|
)
|
|
(14,580
|
)
|
|
(4,404
|
)
|
|
(6,219
|
)
|
|
(10,623
|
)
|
||||||
Residential mortgage
|
(9,466
|
)
|
|
7,597
|
|
|
(1,869
|
)
|
|
(6,093
|
)
|
|
10,819
|
|
|
4,726
|
|
||||||
Home equity and other consumer loans
|
(1,925
|
)
|
|
1,090
|
|
|
(835
|
)
|
|
(299
|
)
|
|
3,460
|
|
|
3,161
|
|
||||||
Total interest income
|
(19,995
|
)
|
|
(210
|
)
|
|
(20,205
|
)
|
|
(20,292
|
)
|
|
10,915
|
|
|
(9,377
|
)
|
||||||
Interest expense on interest-bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Savings and NOW
|
$
|
(525
|
)
|
|
$
|
(129
|
)
|
|
$
|
(654
|
)
|
|
$
|
(1,802
|
)
|
|
$
|
591
|
|
|
$
|
(1,211
|
)
|
Money market
|
(6,306
|
)
|
|
1,607
|
|
|
(4,699
|
)
|
|
(9,064
|
)
|
|
4,769
|
|
|
(4,295
|
)
|
||||||
Certificates of deposit
|
(3,064
|
)
|
|
(3,874
|
)
|
|
(6,938
|
)
|
|
(12,146
|
)
|
|
(4,451
|
)
|
|
(16,597
|
)
|
||||||
Borrowed funds
|
(6,337
|
)
|
|
204
|
|
|
(6,133
|
)
|
|
(175
|
)
|
|
(8,339
|
)
|
|
(8,514
|
)
|
||||||
Total interest expense
|
(16,232
|
)
|
|
(2,192
|
)
|
|
(18,424
|
)
|
|
(23,187
|
)
|
|
(7,430
|
)
|
|
(30,617
|
)
|
||||||
Net interest income
|
$
|
(3,763
|
)
|
|
$
|
1,982
|
|
|
$
|
(1,781
|
)
|
|
$
|
2,895
|
|
|
$
|
18,345
|
|
|
$
|
21,240
|
|
(1)
|
Interest income on non-taxable investments and loans is presented on a non-FTE basis in this Rate-Volume table. The discussion following this table also reflects non-FTE data.
|
|
December 31,
|
|
Increase/
(decrease)
|
|
%
Change
|
|||||||||
|
2011
|
|
2010
|
|
||||||||||
|
(In thousands)
|
|||||||||||||
Assets:
|
|
|
|
|
|
|
|
|||||||
Total cash and investments
|
$
|
1,095,197
|
|
|
$
|
1,338,238
|
|
|
$
|
(243,041
|
)
|
|
(18
|
)%
|
Loans held for sale
|
12,069
|
|
|
9,145
|
|
|
2,924
|
|
|
32
|
%
|
|||
Total loans
|
4,650,228
|
|
|
4,480,347
|
|
|
169,881
|
|
|
4
|
%
|
|||
Less: allowance for loan losses
|
96,114
|
|
|
98,403
|
|
|
(2,289
|
)
|
|
(2
|
)%
|
|||
Net loans
|
4,554,114
|
|
|
4,381,944
|
|
|
172,170
|
|
|
4
|
%
|
|||
Goodwill and intangible assets
|
145,600
|
|
|
151,212
|
|
|
(5,612
|
)
|
|
(4
|
)%
|
|||
Other assets
|
241,392
|
|
|
272,362
|
|
|
(30,970
|
)
|
|
(11
|
)%
|
|||
Total assets
|
$
|
6,048,372
|
|
|
$
|
6,152,901
|
|
|
$
|
(104,529
|
)
|
|
(2
|
)%
|
Liabilities and Equity:
|
|
|
|
|
|
|
|
|||||||
Deposits
|
$
|
4,530,411
|
|
|
$
|
4,486,726
|
|
|
$
|
43,685
|
|
|
1
|
%
|
Total borrowings
|
834,671
|
|
|
1,027,925
|
|
|
(193,254
|
)
|
|
(19
|
)%
|
|||
Other liabilities
|
95,474
|
|
|
99,774
|
|
|
(4,300
|
)
|
|
(4
|
)%
|
|||
Total liabilities
|
5,460,556
|
|
|
5,614,425
|
|
|
(153,869
|
)
|
|
(3
|
)%
|
|||
Redeemable noncontrolling interests
|
21,691
|
|
|
19,598
|
|
|
2,093
|
|
|
11
|
%
|
|||
Total shareholders’ equity
|
566,125
|
|
|
518,878
|
|
|
47,247
|
|
|
9
|
%
|
|||
Total liabilities, redeemable noncontrolling interests and shareholders’ equity
|
$
|
6,048,372
|
|
|
$
|
6,152,901
|
|
|
$
|
(104,529
|
)
|
|
(2
|
)%
|
|
December 31,
|
||||||||||
2011
|
|
2010
|
|
2009
|
|||||||
|
(In thousands)
|
||||||||||
Available for sale:
|
|
|
|
|
|
||||||
U.S. government and agencies (2)
|
$
|
4,903
|
|
|
$
|
81,402
|
|
|
$
|
184,722
|
|
Government-sponsored entities
|
382,208
|
|
|
263,599
|
|
|
188,394
|
|
|||
Corporate bonds
|
4,912
|
|
|
18,816
|
|
|
15,943
|
|
|||
Municipal bonds
|
200,675
|
|
|
194,048
|
|
|
184,544
|
|
|||
Mortgage-backed securities (1)
|
254,344
|
|
|
234,257
|
|
|
311,511
|
|
|||
Other
|
540
|
|
|
3,316
|
|
|
2,918
|
|
|||
Total available for sale
|
$
|
847,582
|
|
|
$
|
795,438
|
|
|
$
|
888,032
|
|
Held to maturity:
|
|
|
|
|
|
||||||
U.S. government and agencies
|
$
|
—
|
|
|
$
|
586
|
|
|
$
|
4,001
|
|
Government-sponsored entities
|
—
|
|
|
1,429
|
|
|
—
|
|
|||
Other
|
—
|
|
|
500
|
|
|
500
|
|
|||
Total held to maturity
|
$
|
—
|
|
|
$
|
2,515
|
|
|
$
|
4,501
|
|
(1)
|
Mortgage-backed securities are guaranteed by Government-sponsored entities or U.S. agencies.
|
(2)
|
Includes money market mutual fund that invests in U.S. government securities.
|
|
Year Ended
December 31, 2011
|
|||||
Average
Balance
|
|
Average
Rate
|
||||
|
(In thousands)
|
|||||
Noninterest bearing deposits:
|
|
|
|
|||
Checking accounts
|
$
|
1,141,563
|
|
|
—
|
%
|
Interest bearing deposits:
|
|
|
|
|||
Savings and NOW
|
517,659
|
|
|
0.27
|
%
|
|
Money market
|
1,898,999
|
|
|
0.55
|
%
|
|
Certificates of deposit
|
1,027,347
|
|
|
1.22
|
%
|
|
Total interest bearing deposits
|
$
|
3,444,005
|
|
|
0.71
|
%
|
Total deposits
|
$
|
4,585,568
|
|
|
0.53
|
%
|
|
December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Less than 3 months remaining
|
$
|
308,430
|
|
|
$
|
369,060
|
|
3 to 6 months remaining
|
167,083
|
|
|
186,132
|
|
||
6 to 12 months remaining
|
163,911
|
|
|
192,371
|
|
||
More than 12 months remaining
|
54,955
|
|
|
72,894
|
|
||
Total
|
$
|
694,379
|
|
|
$
|
820,457
|
|
|
Commercial and Industrial Loans
|
|
Commercial Real Estate Loans
|
|
Construction and
Land Loans
|
|
Residential Mortgage
Loans
|
|
Home Equity,
Consumer, and
Other Loans
|
|||||||||||||||||||||||||
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||||||||||||
New England
|
$
|
531,632
|
|
|
77
|
%
|
|
$
|
643,263
|
|
|
39
|
%
|
|
$
|
106,385
|
|
|
69
|
%
|
|
$
|
1,247,975
|
|
|
68
|
%
|
|
$
|
232,474
|
|
|
73
|
%
|
San Francisco Bay
|
72,850
|
|
|
11
|
%
|
|
679,995
|
|
|
41
|
%
|
|
36,339
|
|
|
24
|
%
|
|
322,352
|
|
|
18
|
%
|
|
60,708
|
|
|
19
|
%
|
|||||
Southern California
|
47,593
|
|
|
7
|
%
|
|
224,362
|
|
|
13
|
%
|
|
5,622
|
|
|
4
|
%
|
|
192,708
|
|
|
11
|
%
|
|
16,388
|
|
|
5
|
%
|
|||||
Pacific Northwest
|
35,027
|
|
|
5
|
%
|
|
121,600
|
|
|
7
|
%
|
|
5,363
|
|
|
3
|
%
|
|
60,368
|
|
|
3
|
%
|
|
5,755
|
|
|
2
|
%
|
|||||
Other, net
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
1,469
|
|
|
1
|
%
|
|||||
Total
|
$
|
687,102
|
|
|
100
|
%
|
|
$
|
1,669,220
|
|
|
100
|
%
|
|
$
|
153,709
|
|
|
100
|
%
|
|
$
|
1,823,403
|
|
|
100
|
%
|
|
$
|
316,794
|
|
|
100
|
%
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
|||||||||||||||||||||||||
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||||||||||||
Commercial loans (1)
|
$
|
2,356,322
|
|
|
51
|
%
|
|
$
|
2,356,413
|
|
|
53
|
%
|
|
$
|
2,213,537
|
|
|
51
|
%
|
|
$
|
2,158,052
|
|
|
52
|
%
|
|
$
|
1,979,682
|
|
|
51
|
%
|
Construction and land loans
|
153,709
|
|
|
3
|
%
|
|
150,702
|
|
|
3
|
%
|
|
315,661
|
|
|
7
|
%
|
|
431,717
|
|
|
11
|
%
|
|
594,920
|
|
|
15
|
%
|
|||||
Residential mortgage loans
|
1,823,403
|
|
|
39
|
%
|
|
1,673,934
|
|
|
37
|
%
|
|
1,494,703
|
|
|
35
|
%
|
|
1,352,881
|
|
|
33
|
%
|
|
1,211,861
|
|
|
31
|
%
|
|||||
Home equity, consumer, and other loans
|
315,325
|
|
|
7
|
%
|
|
297,378
|
|
|
7
|
%
|
|
280,209
|
|
|
7
|
%
|
|
183,794
|
|
|
4
|
%
|
|
114,870
|
|
|
3
|
%
|
|||||
Subtotal Bank loans
|
4,648,759
|
|
|
100
|
%
|
|
4,478,427
|
|
|
100
|
%
|
|
4,304,110
|
|
|
100
|
%
|
|
4,126,444
|
|
|
100
|
%
|
|
3,901,333
|
|
|
100
|
%
|
|||||
Less: Allowance for loan losses
|
96,114
|
|
|
|
|
98,403
|
|
|
|
|
68,444
|
|
|
|
|
64,091
|
|
|
|
|
59,933
|
|
|
|
||||||||||
Net Bank loans
|
$
|
4,552,645
|
|
|
|
|
$
|
4,380,024
|
|
|
|
|
$
|
4,235,666
|
|
|
|
|
$
|
4,062,353
|
|
|
|
|
$
|
3,841,400
|
|
|
|
(1)
|
Includes commercial and industrial loans and commercial real estate loans.
|
|
Commercial,
Construction and
Land Loans (1) |
|
Residential Mortgage
Loans
|
|
Home Equity,
Consumer, and
Other Loans
|
|
Total Bank Loans
|
||||||||||||||||||||
|
Balance
|
|
Percent
|
|
Balance
|
|
Percent
|
|
Balance
|
|
Percent
|
|
Balance
|
|
Percent
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
Amounts due:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
One year or less
|
$
|
434,986
|
|
|
17
|
%
|
|
$
|
780
|
|
|
—
|
%
|
|
$
|
64,634
|
|
|
20
|
%
|
|
$
|
500,400
|
|
|
11
|
%
|
After one through five years
|
842,493
|
|
|
34
|
%
|
|
6,630
|
|
|
—
|
%
|
|
112,569
|
|
|
36
|
%
|
|
961,692
|
|
|
21
|
%
|
||||
Beyond five years
|
1,232,552
|
|
|
49
|
%
|
|
1,815,993
|
|
|
100
|
%
|
|
138,122
|
|
|
44
|
%
|
|
3,186,667
|
|
|
68
|
%
|
||||
Total
|
$
|
2,510,031
|
|
|
100
|
%
|
|
$
|
1,823,403
|
|
|
100
|
%
|
|
$
|
315,325
|
|
|
100
|
%
|
|
$
|
4,648,759
|
|
|
100
|
%
|
Interest rate terms on amounts due after one year:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed
|
$
|
974,928
|
|
|
47
|
%
|
|
$
|
253,192
|
|
|
14
|
%
|
|
$
|
35,030
|
|
|
14
|
%
|
|
$
|
1,263,150
|
|
|
30
|
%
|
Adjustable
|
1,100,117
|
|
|
53
|
%
|
|
1,569,431
|
|
|
86
|
%
|
|
215,661
|
|
|
86
|
%
|
|
2,885,209
|
|
|
70
|
%
|
||||
Total
|
$
|
2,075,045
|
|
|
100
|
%
|
|
$
|
1,822,623
|
|
|
100
|
%
|
|
$
|
250,691
|
|
|
100
|
%
|
|
$
|
4,148,359
|
|
|
100
|
%
|
(1)
|
Includes commercial and industrial loans and commercial real estate loans.
|
|
Year ended December 31,
|
||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
|||||||||||
|
(In thousands)
|
||||||||||||||||||
Total loans outstanding
|
$
|
4,650,228
|
|
|
$
|
4,480,347
|
|
|
$
|
4,307,040
|
|
|
$
|
4,129,081
|
|
|
$
|
4,003,291
|
|
Average loans outstanding
|
4,473,645
|
|
|
4,448,109
|
|
|
4,263,775
|
|
|
4,130,381
|
|
|
3,468,772
|
|
|||||
Allowance for loan losses, beginning of year
|
$
|
98,403
|
|
|
$
|
68,444
|
|
|
$
|
64,091
|
|
|
$
|
59,933
|
|
|
$
|
33,234
|
|
Charged-off loans:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial, construction, and land (1)
|
(24,308
|
)
|
|
(66,017
|
)
|
|
(40,596
|
)
|
|
(192,259
|
)
|
|
(130
|
)
|
|||||
Residential
|
(1,507
|
)
|
|
(571
|
)
|
|
(436
|
)
|
|
(151
|
)
|
|
—
|
|
|||||
Home equity, consumer, and other
|
(1,609
|
)
|
|
(151
|
)
|
|
(902
|
)
|
|
(386
|
)
|
|
(61
|
)
|
|||||
Total charged-off loans
|
(27,424
|
)
|
|
(66,739
|
)
|
|
(41,934
|
)
|
|
(192,796
|
)
|
|
(191
|
)
|
|||||
Recoveries on loans previously charged off:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial, construction, and land (1)
|
11,807
|
|
|
9,346
|
|
|
1,248
|
|
|
305
|
|
|
664
|
|
|||||
Residential mortgage
|
100
|
|
|
34
|
|
|
69
|
|
|
—
|
|
|
—
|
|
|||||
Home equity, consumer, and other
|
68
|
|
|
140
|
|
|
11
|
|
|
6
|
|
|
5
|
|
|||||
Total recoveries
|
11,975
|
|
|
9,520
|
|
|
1,328
|
|
|
311
|
|
|
669
|
|
|||||
Net loans (charged-off)/ recoveries
|
(15,449
|
)
|
|
(57,219
|
)
|
|
(40,606
|
)
|
|
(192,485
|
)
|
|
478
|
|
|||||
Provision for loan losses
|
13,160
|
|
|
87,178
|
|
|
44,959
|
|
|
196,643
|
|
|
23,449
|
|
|||||
Addition due to acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,772
|
|
|||||
Allowance for loan losses, end of year
|
$
|
96,114
|
|
|
$
|
98,403
|
|
|
$
|
68,444
|
|
|
$
|
64,091
|
|
|
$
|
59,933
|
|
Net loans charged-off/ (recovered) to average loans
|
0.35
|
%
|
|
1.29
|
%
|
|
0.95
|
%
|
|
4.66
|
%
|
|
(0.01
|
)%
|
|||||
Allowance for loan losses to total loans
|
2.07
|
%
|
|
2.20
|
%
|
|
1.59
|
%
|
|
1.55
|
%
|
|
1.50
|
%
|
|||||
Allowance for loan losses to nonaccrual loans (2)
|
1.41
|
|
|
0.93
|
|
|
0.79
|
|
|
1.74
|
|
|
1.76
|
|
(1)
|
Includes commercial and industrial loans and commercial real estate loans.
|
(2)
|
Excludes loans in the held for sale category that are on nonaccrual status.
|
|
December 31,
|
|||||||||||||||||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
||||||||||||||||||||||||||
Amount
|
|
%(1)
|
|
Amount
|
|
%(1)
|
|
Amount
|
|
%(1)
|
|
Amount
|
|
%(1)
|
|
Amount
|
|
%(1)
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||||||||||||
Loan category:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Commercial, construction and land (2)
|
$
|
82,170
|
|
|
54
|
%
|
|
$
|
86,672
|
|
|
56
|
%
|
|
$
|
59,263
|
|
|
58
|
%
|
|
$
|
47,552
|
|
|
63
|
%
|
|
$
|
43,795
|
|
|
66
|
%
|
Residential
|
9,286
|
|
|
39
|
%
|
|
7,449
|
|
|
37
|
%
|
|
5,805
|
|
|
35
|
%
|
|
7,780
|
|
|
33
|
%
|
|
6,406
|
|
|
31
|
%
|
|||||
Home equity, consumer, and other
|
2,684
|
|
|
7
|
%
|
|
2,110
|
|
|
7
|
%
|
|
1,898
|
|
|
7
|
%
|
|
1,490
|
|
|
4
|
%
|
|
946
|
|
|
3
|
%
|
|||||
Unallocated
|
1,974
|
|
|
|
|
2,172
|
|
|
|
|
1,478
|
|
|
|
|
7,269
|
|
|
|
|
8,786
|
|
|
|
||||||||||
Total allowance for loan losses
|
$
|
96,114
|
|
|
100
|
%
|
|
$
|
98,403
|
|
|
100
|
%
|
|
$
|
68,444
|
|
|
100
|
%
|
|
$
|
64,091
|
|
|
100
|
%
|
|
$
|
59,933
|
|
|
100
|
%
|
(1)
|
Percent refers to the amount of loans in each category as a percent of total loans.
|
(2)
|
Includes commercial and industrial loans and commercial real estate loans.
|
|
For the year ended December 31,
|
||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
|||||||||||
|
(In thousands)
|
||||||||||||||||||
Net loans (charged-off)/ recoveries:
|
|
|
|
|
|
|
|
|
|
||||||||||
New England
|
$
|
(3,532
|
)
|
|
$
|
(3,725
|
)
|
|
$
|
(2,495
|
)
|
|
$
|
(4,003
|
)
|
|
$
|
(51
|
)
|
San Francisco Bay
|
(14,979
|
)
|
|
(54,858
|
)
|
|
(8,387
|
)
|
|
(407
|
)
|
|
(33
|
)
|
|||||
Southern California
|
4,066
|
|
|
1,753
|
|
|
(13,017
|
)
|
|
(185,904
|
)
|
|
575
|
|
|||||
Pacific Northwest
|
(1,004
|
)
|
|
(389
|
)
|
|
(16,707
|
)
|
|
(2,171
|
)
|
|
(13
|
)
|
|||||
Total net loans (charged-off)/ recoveries
|
$
|
(15,449
|
)
|
|
$
|
(57,219
|
)
|
|
$
|
(40,606
|
)
|
|
$
|
(192,485
|
)
|
|
$
|
478
|
|
|
December 31,
|
||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
|||||||||||
|
(In thousands)
|
||||||||||||||||||
Loans accounted for on a nonaccrual basis
|
$
|
68,109
|
|
|
$
|
105,465
|
|
|
$
|
86,770
|
|
|
$
|
36,771
|
|
|
$
|
34,115
|
|
Loans held for sale accounted for on a nonaccrual basis
|
—
|
|
|
1,526
|
|
|
3,568
|
|
|
27,219
|
|
|
—
|
|
|||||
OREO
|
5,103
|
|
|
12,925
|
|
|
16,600
|
|
|
12,838
|
|
|
711
|
|
|||||
Repossessed assets
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
475
|
|
|||||
Total nonperforming assets
|
$
|
73,212
|
|
|
$
|
119,916
|
|
|
$
|
106,938
|
|
|
$
|
76,828
|
|
|
$
|
35,301
|
|
Loans past due 90 days or more, but still accruing
|
$
|
32
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Delinquent loans 30-89 days past due
|
$
|
26,957
|
|
|
$
|
24,745
|
|
|
$
|
21,194
|
|
|
$
|
18,655
|
|
|
$
|
18,419
|
|
Troubled debt restructured loans (1)
|
$
|
55,262
|
|
|
$
|
20,123
|
|
|
$
|
8,003
|
|
|
$
|
1,400
|
|
|
$
|
—
|
|
Nonaccrual loans as a % of total loans (2)
|
1.46
|
%
|
|
2.35
|
%
|
|
2.01
|
%
|
|
0.89
|
%
|
|
0.85
|
%
|
|||||
Nonperforming assets as a % of total assets
|
1.21
|
%
|
|
1.95
|
%
|
|
1.77
|
%
|
|
1.05
|
%
|
|
0.51
|
%
|
|||||
Delinquent loans 30-89 days past due as a % of total loans (3)
|
0.58
|
%
|
|
0.55
|
%
|
|
0.49
|
%
|
|
0.45
|
%
|
|
0.46
|
%
|
(1)
|
Includes $27.8 million, $16.1 million, and $8.0 million also reported in nonaccrual loans as of December 31, 2011, 2010, and 2009 respectively.
|
(2)
|
Excludes loans held for sale on nonaccrual status of $1.5 million, $3.6 million, and $27.2 million as of December 31, 2010, 2009 and 2008 respectively.
|
(3)
|
Excludes loans past due 90 days or more, but still accruing of less $0.1 million as of December 31, 2011.
|
|
December 31,
|
||||||
2011
|
|
2010
|
|||||
(In thousands)
|
|||||||
Nonaccrual loans, beginning of year (1)
|
$
|
105,465
|
|
|
$
|
86,770
|
|
Transfers in to nonaccrual status
|
103,227
|
|
|
183,170
|
|
||
Transfers out to OREO
|
(11,118
|
)
|
|
(19,519
|
)
|
||
Transfers in from/ (out to) loans held for sale
|
526
|
|
|
—
|
|
||
Transfers out to accrual status
|
(54,584
|
)
|
|
(16,388
|
)
|
||
Charge-offs
|
(25,869
|
)
|
|
(65,052
|
)
|
||
Paid off/ paid down
|
(49,538
|
)
|
|
(63,516
|
)
|
||
Nonaccrual loans, end of year (2)
|
$
|
68,109
|
|
|
$
|
105,465
|
|
(1)
|
Does not include the loans in the Company's non-strategic Southern California loans held for sale portfolio on nonaccrual
|
(2)
|
Does not include the loan in the Company's non-strategic Southern California loans held for sale portfolio on nonaccrual
|
|
December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Nonaccrual loans:
|
|
|
|
||||
New England
|
$
|
33,411
|
|
|
$
|
25,172
|
|
San Francisco Bay
|
25,598
|
|
|
60,373
|
|
||
Southern California (1)
|
7,323
|
|
|
9,137
|
|
||
Pacific Northwest
|
1,777
|
|
|
10,783
|
|
||
Total nonaccrual loans
|
$
|
68,109
|
|
|
$
|
105,465
|
|
Loans 30-89 days past due and accruing:
|
|
|
|
||||
New England (2)
|
$
|
9,834
|
|
|
$
|
12,844
|
|
San Francisco Bay
|
11,446
|
|
|
11,219
|
|
||
Southern California
|
5,677
|
|
|
682
|
|
||
Pacific Northwest
|
—
|
|
|
—
|
|
||
Total loans 30-89 days past due
|
$
|
26,957
|
|
|
$
|
24,745
|
|
Accruing classified loans: (3)
|
|
|
|
||||
New England
|
$
|
23,133
|
|
|
$
|
19,745
|
|
San Francisco Bay
|
57,199
|
|
|
62,518
|
|
||
Southern California
|
15,723
|
|
|
6,802
|
|
||
Pacific Northwest
|
2,186
|
|
|
8,373
|
|
||
Total accruing classified loans
|
$
|
98,241
|
|
|
$
|
97,438
|
|
(1)
|
Does not include a loan held for sale on nonaccrual status of $1.5 million as of
December 31, 2010
. There were no loans held for sale on nonaccrual status as of December 31, 2011.
|
(2)
|
In addition to loans 30-89 days past due and accruing, at December 31, 2011, the Company had two loans totaling less than $0.1 million that were more than 90 days past due but still on accrual status. These loans originated in the New England region. There were no loans more than 90 days past due and still on accrual status at December 31, 2010.
|
(3)
|
Accruing classified loans include loans that are classified as substandard but are still accruing interest income. The Bank may classify a loan as substandard where known information about possible credit problems of the related borrowers causes management to have doubts as to the ability of such borrowers to comply with the present repayment terms and which may result in disclosure of such loans as nonperforming at some time in the future.
|
|
December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Nonaccrual loans: (1)
|
|
|
|
||||
Commercial and industrial
|
$
|
3,759
|
|
|
$
|
8,583
|
|
Commercial real estate
|
38,581
|
|
|
66,518
|
|
||
Construction and land
|
7,772
|
|
|
15,323
|
|
||
Residential
|
17,513
|
|
|
14,111
|
|
||
Home equity and other consumer
|
484
|
|
|
930
|
|
||
Total nonaccrual loans
|
$
|
68,109
|
|
|
$
|
105,465
|
|
Loans 30-89 days past due and accruing: (2)
|
|
|
|
||||
Commercial and industrial
|
$
|
1,648
|
|
|
$
|
7,456
|
|
Commercial real estate
|
8,915
|
|
|
10,446
|
|
||
Construction and land
|
74
|
|
|
—
|
|
||
Residential
|
14,407
|
|
|
6,553
|
|
||
Home equity and other consumer
|
1,913
|
|
|
290
|
|
||
Total loans 30-89 days past due
|
$
|
26,957
|
|
|
$
|
24,745
|
|
Accruing classified loans: (3)
|
|
|
|
||||
Commercial and industrial
|
$
|
22,249
|
|
|
$
|
18,502
|
|
Commercial real estate
|
63,105
|
|
|
75,281
|
|
||
Construction and land
|
3,754
|
|
|
2,240
|
|
||
Residential
|
7,255
|
|
|
971
|
|
||
Home equity and other consumer
|
1,878
|
|
|
444
|
|
||
Total accruing classified loans
|
$
|
98,241
|
|
|
$
|
97,438
|
|
(1)
|
Does not include a loan held for sale on nonaccrual status of $1.5 million as of
December 31, 2010
. There were no loans held for sale on nonaccrual status as of December 31, 2011.
|
(2)
|
In addition to loans 30-89 days past due and accruing, at December 31, 2011, the Company had two loans totaling less than $0.1 million that were more than 90 days past due but still on accrual status. There were no loans more than 90 days past due and still on accrual status at December 31, 2010.
|
(3)
|
Accruing classified loans include loans that are classified as substandard but are still accruing interest income. The Bank may classify a loan as substandard where known information about possible credit problems of the related borrowers causes management to have doubts as to the ability of such borrowers to comply with the present repayment terms and which may result in disclosure of such loans as nonperforming at some time in the future.
|
|
Year ended December 31,
|
||||||||||||||||||
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Loans accounted for on a nonaccrual basis (1)
|
$
|
68,109
|
|
|
$
|
106,991
|
|
|
$
|
90,338
|
|
|
$
|
63,990
|
|
|
$
|
34,115
|
|
Interest income recorded during the year on these loans (2)
|
1,576
|
|
|
3,951
|
|
|
3,200
|
|
|
6,130
|
|
|
1,435
|
|
|||||
Interest income that would have been recorded on these nonaccrual loans during the year if the loans had been performing in accordance with their original terms and had been outstanding for the full year or since origination, if held for part of the year
|
5,437
|
|
|
9,187
|
|
|
9,011
|
|
|
10,165
|
|
|
3,399
|
|
|||||
Accruing troubled debt restructured loans
|
27,433
|
|
|
3,983
|
|
|
1,905
|
|
|
—
|
|
|
—
|
|
|||||
Interest income recorded during the year on these accruing TDR loans (3)
|
1,222
|
|
|
nm
|
|
nm
|
|
—
|
|
|
—
|
|
|||||||
Interest income that would have been recorded on these accruing TDR loans during the year if the loans had been performing in accordance with their original terms and had been outstanding for the full year or since origination, if held for part of the year (3)
|
1,983
|
|
|
nm
|
|
nm
|
|
—
|
|
|
—
|
|
(1)
|
Includes loans held for sale on nonaccrual status of $1.5 million, $3.6 million, and $27.2 million as of December 31, 2010, 2009 and 2008 respectively.
|
(2)
|
Represents interest income recorded while loans were in a performing status, prior to being placed on nonaccrual status and any interest income recorded on a cash basis while the loan was on nonaccrual status.
|
(3)
|
Interest income on accruing TDRs was not material (nm) for the periods ended 2010 and 2009. Interest income that would have been recorded on accruing TDRs during the year if the loans had been performing in accordance with their original terms and had been outstanding for the full year, or since origination if held for part of the year, was not material for the years ended 2010 and 2009.
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less than 1
Year
|
|
1-3
Years
|
|
3-5
Years
|
|
More than
5 Years
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Federal Home Loan Bank Borrowings
|
$
|
521,827
|
|
|
$
|
125,977
|
|
|
$
|
121,519
|
|
|
$
|
187,252
|
|
|
$
|
87,079
|
|
Securities sold under agreements to repurchase
|
130,791
|
|
|
77,791
|
|
|
38,000
|
|
|
15,000
|
|
|
—
|
|
|||||
Junior subordinated debentures
|
182,053
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
182,053
|
|
|||||
Operating lease obligations
|
72,663
|
|
|
12,937
|
|
|
22,479
|
|
|
13,710
|
|
|
23,537
|
|
|||||
Deferred compensation and benefits (1)
|
21,362
|
|
|
5,281
|
|
|
1,930
|
|
|
3,086
|
|
|
11,065
|
|
|||||
Data processing
|
10,054
|
|
|
2,483
|
|
|
2,688
|
|
|
2,520
|
|
|
2,363
|
|
|||||
Bonus and commissions
|
3,379
|
|
|
3,312
|
|
|
67
|
|
|
—
|
|
|
—
|
|
|||||
Severance accrual
|
2,658
|
|
|
2,658
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other long-term obligations
|
23,289
|
|
|
16,176
|
|
|
1,499
|
|
|
1,316
|
|
|
4,298
|
|
|||||
Total contractual obligations at December 31, 2011
|
$
|
968,076
|
|
|
$
|
246,615
|
|
|
$
|
188,182
|
|
|
$
|
222,884
|
|
|
$
|
310,395
|
|
(1)
|
Includes supplemental executive retirement plan, deferred compensation plan, salary continuation plans, long term incentive plan, and split dollar life insurance.
|
|
Payments Due by Period
|
||||||||||||||||||
Total
|
|
Less than 1
Year
|
|
1-3
Years
|
|
3-5
Years
|
|
More than
5 Years
|
|||||||||||
|
(In thousands)
|
||||||||||||||||||
Unadvanced portion of loans, unused lines of credit, and commitments to originate loans
|
$
|
1,085,653
|
|
|
$
|
511,071
|
|
|
$
|
332,159
|
|
|
$
|
46,045
|
|
|
$
|
196,378
|
|
Standby letters of credit
|
18,426
|
|
|
17,874
|
|
|
552
|
|
|
—
|
|
|
—
|
|
|||||
Forward commitments to sell loans
|
44,868
|
|
|
44,868
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total commitments at December 31, 2011
|
$
|
1,148,947
|
|
|
$
|
573,813
|
|
|
$
|
332,711
|
|
|
$
|
46,045
|
|
|
$
|
196,378
|
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
•
|
The base model is built as a static balance sheet simulation. Growth and/or contraction are not incorporated into the base model to avoid masking of the inherent interest rate risk in the balance sheet as it stands at a point in time, however, balance sheet adjustments may be incorporated into the model to reflect anticipated changes in certain balance sheet categories.
|
•
|
The model utilizes the FHLB, LIBOR, and Treasury yield curves in effect as of
December 31, 2011
. Other market rates used in this analysis include the Prime rate, which was 3.25%, and federal funds rate, which ranged from 0.00% to 0.25%, respectively, at
December 31, 2011
. All interest rate changes are assumed to occur in the first 12 months and remain flat thereafter. Federal funds and Treasury yields are floored at 0.01% while Prime is floored at 3.00%. All other market rates (LIBOR, FHLB, brokered CD) are floored at 0.25% to reflect credit spreads. All points on the treasury yield curve increase/decrease congruently.
|
•
|
Short-term interest rates (
e.g.,
Prime and federal funds) are assumed to drive non-maturity deposit (savings, NOW and money market accounts) pricing. Term deposit (CD, IRA) pricing changes are reflective of changes in the LIBOR swap and/or FHLB yield curves. For rising and falling rate environments, prepayment speeds accelerate/decelerate over a 12 month period and remain flat thereafter.
|
|
Within Three
Months
|
|
Over Three to
Six Months
|
|
Over Six to
Twelve
Months
|
|
Over One
Year to Five
Years
|
|
Over Five
Years
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Interest-earning assets (1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest bearing cash
|
$
|
129,807
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
129,807
|
|
Investment securities
|
119,398
|
|
|
100,884
|
|
|
200,771
|
|
|
365,857
|
|
|
60,672
|
|
|
847,582
|
|
||||||
FHLB stock
|
43,714
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43,714
|
|
||||||
Loans held for sale (2)
|
12,069
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,069
|
|
||||||
Loans—Fixed rate
|
74,715
|
|
|
69,283
|
|
|
125,776
|
|
|
762,127
|
|
|
545,852
|
|
|
1,577,753
|
|
||||||
Loans—Variable rate
|
1,074,008
|
|
|
283,444
|
|
|
234,342
|
|
|
1,315,873
|
|
|
164,808
|
|
|
3,072,475
|
|
||||||
Total interest-earning assets
|
$
|
1,453,711
|
|
|
$
|
453,611
|
|
|
$
|
560,889
|
|
|
$
|
2,443,857
|
|
|
$
|
771,332
|
|
|
$
|
5,683,400
|
|
Interest-bearing liabilities (3):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Savings and NOW accounts (4)
|
$
|
525,609
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
525,609
|
|
Money market accounts (4)
|
1,966,073
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,966,073
|
|
||||||
Certificates of deposit under $100,000
|
69,295
|
|
|
52,139
|
|
|
45,808
|
|
|
51,038
|
|
|
8,720
|
|
|
227,000
|
|
||||||
Certificates of deposit $100,000 or more
|
308,430
|
|
|
167,083
|
|
|
163,911
|
|
|
47,403
|
|
|
7,552
|
|
|
694,379
|
|
||||||
Securities sold under agreements to repurchase
|
77,791
|
|
|
—
|
|
|
—
|
|
|
53,000
|
|
|
—
|
|
|
130,791
|
|
||||||
FHLB borrowings
|
60,560
|
|
|
22,101
|
|
|
86,230
|
|
|
267,183
|
|
|
85,753
|
|
|
521,827
|
|
||||||
Junior subordinated debentures (5)
|
54,898
|
|
|
—
|
|
|
—
|
|
|
75,000
|
|
|
52,155
|
|
|
182,053
|
|
||||||
Total interest-bearing liabilities
|
$
|
3,062,656
|
|
|
$
|
241,323
|
|
|
$
|
295,949
|
|
|
$
|
493,624
|
|
|
$
|
154,180
|
|
|
$
|
4,247,732
|
|
Net interest sensitivity gap during the period
|
$
|
(1,608,945
|
)
|
|
$
|
212,288
|
|
|
$
|
264,940
|
|
|
$
|
1,950,233
|
|
|
$
|
617,152
|
|
|
$
|
1,435,668
|
|
Cumulative gap
|
$
|
(1,608,945
|
)
|
|
$
|
(1,396,657
|
)
|
|
$
|
(1,131,717
|
)
|
|
$
|
818,516
|
|
|
$
|
1,435,668
|
|
|
|
||
Interest-sensitive assets as a percent of interest-sensitive liabilities (cumulative)
|
47.47
|
%
|
|
57.73
|
%
|
|
68.56
|
%
|
|
120.00
|
%
|
|
133.80
|
%
|
|
|
|||||||
Cumulative gap as a percent of total assets
|
(26.60
|
)%
|
|
(23.09
|
)%
|
|
(18.71
|
)%
|
|
13.53
|
%
|
|
23.74
|
%
|
|
|
(1)
|
Adjustable and floating-rate assets are included in the period in which interest rates are next scheduled to adjust rather than in the period in which they are due, and fixed rate assets are included in the periods in which they are scheduled to mature or have contractual returns of principal. Prepayments of principal based upon standard estimated prepayment speeds are also included in each time period.
|
(2)
|
Loans held for sale are typically sold within three months of origination.
|
(3)
|
Does not include $1,117.4 million of demand accounts because they are non-interest bearing.
|
(4)
|
While savings, NOW and money market accounts can be withdrawn any time, management believes they have characteristics that make their effective maturity longer.
|
(5)
|
Includes the economic effect of hedges.
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
|
|
December 31, 2011
|
|
December 31, 2010
|
||||
|
(In thousands, except share and per share data)
|
||||||
Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
203,901
|
|
|
$
|
494,439
|
|
Investment securities:
|
|
|
|
||||
Available for sale (amortized cost of $836,426 and $789,471 at December 31, 2011 and 2010, respectively)
|
847,582
|
|
|
795,438
|
|
||
Held to maturity (fair value of $0 and $2,497 at December 31, 2011 and 2010, respectively)
|
—
|
|
|
2,515
|
|
||
Total investment securities
|
847,582
|
|
|
797,953
|
|
||
Loans held for sale
|
12,069
|
|
|
9,145
|
|
||
Total loans
|
4,650,228
|
|
|
4,480,347
|
|
||
Less: Allowance for loan losses
|
96,114
|
|
|
98,403
|
|
||
Net loans
|
4,554,114
|
|
|
4,381,944
|
|
||
Other real estate owned (“OREO”)
|
5,103
|
|
|
12,925
|
|
||
Stock in Federal Home Loan Banks
|
43,714
|
|
|
45,846
|
|
||
Premises and equipment, net
|
29,353
|
|
|
26,642
|
|
||
Goodwill
|
115,038
|
|
|
115,051
|
|
||
Intangible assets, net
|
30,562
|
|
|
36,161
|
|
||
Fees receivable
|
8,147
|
|
|
8,213
|
|
||
Accrued interest receivable
|
16,875
|
|
|
16,707
|
|
||
Deferred income taxes, net
|
66,769
|
|
|
80,718
|
|
||
Other assets
|
115,145
|
|
|
127,157
|
|
||
Total assets
|
$
|
6,048,372
|
|
|
$
|
6,152,901
|
|
Liabilities:
|
|
|
|
||||
Deposits
|
$
|
4,530,411
|
|
|
$
|
4,486,726
|
|
Securities sold under agreements to repurchase
|
130,791
|
|
|
258,598
|
|
||
Federal Home Loan Bank borrowings
|
521,827
|
|
|
575,682
|
|
||
Junior subordinated debentures
|
182,053
|
|
|
193,645
|
|
||
Other liabilities
|
95,474
|
|
|
99,774
|
|
||
Total liabilities
|
5,460,556
|
|
|
5,614,425
|
|
||
Redeemable Noncontrolling Interests
|
21,691
|
|
|
19,598
|
|
||
Shareholders’ Equity:
|
|
|
|
||||
Preferred stock, $1.00 par value; authorized: 2,000,000 shares;
|
|
|
|
||||
Series B, issued and outstanding (contingently convertible): 401 shares at December 31, 2011 and 2010; liquidation value: $100,000 per share
|
58,089
|
|
|
58,089
|
|
||
Common stock, $1.00 par value; authorized: 170,000,000 shares; issued and outstanding: 78,023,317 shares at December 31, 2011 and 76,307,329 shares at December 31, 2010
|
78,023
|
|
|
76,307
|
|
||
Additional paid-in capital
|
656,436
|
|
|
652,288
|
|
||
Accumulated deficit
|
(230,017
|
)
|
|
(269,154
|
)
|
||
Accumulated other comprehensive income
|
3,594
|
|
|
1,348
|
|
||
Total shareholders’ equity
|
566,125
|
|
|
518,878
|
|
||
Total liabilities, redeemable noncontrolling interests and shareholders’ equity
|
$
|
6,048,372
|
|
|
$
|
6,152,901
|
|
|
Year Ended December 31,
|
||||||||||
|
2011
|
|
2010
|
|
2009
|
||||||
|
(In thousands, except share and per share data)
|
||||||||||
Interest and dividend income:
|
|
|
|
|
|
||||||
Loans
|
$
|
211,997
|
|
|
$
|
229,281
|
|
|
$
|
232,017
|
|
Taxable investment securities
|
5,593
|
|
|
6,123
|
|
|
6,566
|
|
|||
Non-taxable investment securities
|
3,768
|
|
|
5,134
|
|
|
6,041
|
|
|||
Mortgage-backed securities
|
7,297
|
|
|
8,086
|
|
|
13,487
|
|
|||
Federal funds sold and other
|
1,077
|
|
|
1,313
|
|
|
1,203
|
|
|||
Total interest and dividend income
|
229,732
|
|
|
249,937
|
|
|
259,314
|
|
|||
Interest expense:
|
|
|
|
|
|
||||||
Deposits
|
24,479
|
|
|
36,770
|
|
|
58,872
|
|
|||
Federal Home Loan Bank borrowings
|
16,915
|
|
|
20,125
|
|
|
25,324
|
|
|||
Junior subordinated debentures and other long-term debt
|
7,434
|
|
|
10,028
|
|
|
12,324
|
|
|||
Repurchase agreements and other short-term borrowings
|
1,960
|
|
|
2,289
|
|
|
3,309
|
|
|||
Total interest expense
|
50,788
|
|
|
69,212
|
|
|
99,829
|
|
|||
Net interest income
|
178,944
|
|
|
180,725
|
|
|
159,485
|
|
|||
Provision for loan losses
|
13,160
|
|
|
87,178
|
|
|
44,959
|
|
|||
Net interest income/(loss) after provision for loan losses
|
165,784
|
|
|
93,547
|
|
|
114,526
|
|
|||
Fees and other income:
|
|
|
|
|
|
||||||
Investment management and trust fees
|
63,356
|
|
|
60,198
|
|
|
54,697
|
|
|||
Wealth advisory fees
|
41,082
|
|
|
37,874
|
|
|
34,834
|
|
|||
Other banking fee income
|
5,038
|
|
|
5,401
|
|
|
4,954
|
|
|||
Gain on repurchase of debt
|
4,230
|
|
|
—
|
|
|
18,739
|
|
|||
Gain on sale of investments, net
|
798
|
|
|
3,653
|
|
|
5,803
|
|
|||
Gain on sale of loans, net
|
2,489
|
|
|
5,249
|
|
|
5,467
|
|
|||
Gain/(loss) on OREO, net
|
5,372
|
|
|
(2,839
|
)
|
|
(1,165
|
)
|
|||
Other
|
2,605
|
|
|
2,236
|
|
|
3,120
|
|
|||
Total fees and other income
|
124,970
|
|
|
111,772
|
|
|
126,449
|
|
|||
Operating expense:
|
|
|
|
|
|
||||||
Salaries and employee benefits
|
147,311
|
|
|
143,248
|
|
|
127,707
|
|
|||
Occupancy and equipment
|
30,078
|
|
|
27,773
|
|
|
26,818
|
|
|||
Professional services
|
16,932
|
|
|
19,495
|
|
|
19,841
|
|
|||
Marketing and business development
|
6,922
|
|
|
7,312
|
|
|
6,462
|
|
|||
Contract services and data processing
|
5,293
|
|
|
5,398
|
|
|
5,271
|
|
|||
Amortization of intangibles
|
5,014
|
|
|
5,264
|
|
|
8,289
|
|
|||
Impairment of goodwill and intangibles
|
—
|
|
|
—
|
|
|
1,699
|
|
|||
FDIC insurance
|
6,139
|
|
|
8,603
|
|
|
9,746
|
|
|||
Restructuring expense
|
8,055
|
|
|
—
|
|
|
—
|
|
|||
Other
|
14,389
|
|
|
19,762
|
|
|
17,125
|
|
|||
(Continued)
|
|
|
|
|
|
|
Common
Stock
|
|
Preferred
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings/
(Accumulated
Deficit)
|
|
Accumulated
Other
Comprehensive
Income/
(Loss)
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||
|
(In thousands, except share data)
|
||||||||||||||||||||||||||
Balance at December 31, 2008
|
$
|
63,874
|
|
|
$
|
178,345
|
|
|
$
|
654,903
|
|
|
$
|
(263,417
|
)
|
|
$
|
11,471
|
|
|
$
|
3,500
|
|
|
$
|
648,676
|
|
Comprehensive Income/ (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income/ (loss) attributable to the Company
|
—
|
|
|
—
|
|
|
—
|
|
|
5,231
|
|
|
—
|
|
|
—
|
|
|
5,231
|
|
|||||||
Other comprehensive income/ (loss), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Change in unrealized gain/ (loss) on securities available for sale, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,785
|
)
|
|
—
|
|
|
(1,785
|
)
|
|||||||
Change in unrealized gain/ (loss) on cash flow hedge, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,283
|
)
|
|
—
|
|
|
(1,283
|
)
|
|||||||
Change in unrealized gain/ (loss) on other, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(831
|
)
|
|
—
|
|
|
(831
|
)
|
|||||||
Total comprehensive income/ (loss) attributable to the Company, net
|
|
|
|
|
|
|
|
|
|
|
|
|
1,332
|
|
|||||||||||||
Dividends paid to common shareholders: $0.04 per share
|
—
|
|
|
—
|
|
|
(2,688
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,688
|
)
|
|||||||
Dividends paid to preferred shareholders
|
—
|
|
|
—
|
|
|
(7,862
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,862
|
)
|
|||||||
Net proceeds from issuance of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
4,015,744 shares of common stock
|
4,016
|
|
|
—
|
|
|
7,378
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,394
|
|
|||||||
697,327 shares through incentive stock grants, net of cancellations and forfeitures
|
697
|
|
|
—
|
|
|
(697
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Accretion of the Beneficial Conversion Feature on Series B Preferred stock
|
—
|
|
|
24,428
|
|
|
(24,428
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Accretion of discount on Series C Preferred stock
|
—
|
|
|
1,438
|
|
|
(1,438
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Amortization of stock compensation and employee stock purchase plan
|
—
|
|
|
—
|
|
|
6,943
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,943
|
|
|||||||
Stock options exercised
|
79
|
|
|
—
|
|
|
262
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
341
|
|
|||||||
Other equity adjustments
|
—
|
|
|
(110
|
)
|
|
(3,372
|
)
|
|
—
|
|
|
—
|
|
|
(3,500
|
)
|
|
(6,982
|
)
|
|||||||
Balance at December 31, 2009
|
$
|
68,666
|
|
|
$
|
204,101
|
|
|
$
|
629,001
|
|
|
$
|
(258,186
|
)
|
|
$
|
7,572
|
|
|
$
|
—
|
|
|
$
|
651,154
|
|
(Continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock
|
|
Preferred
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings/
(Accumulated
Deficit)
|
|
Accumulated
Other
Comprehensive
Income/
(Loss)
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||
|
(In thousands, except share data)
|
||||||||||||||||||||||||||
Balance at December 31, 2009
|
$
|
68,666
|
|
|
$
|
204,101
|
|
|
$
|
629,001
|
|
|
$
|
(258,186
|
)
|
|
$
|
7,572
|
|
|
$
|
—
|
|
|
$
|
651,154
|
|
Comprehensive Income/ (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income/ (loss) attributable to the Company
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,970
|
)
|
|
—
|
|
|
—
|
|
|
(10,970
|
)
|
|||||||
Other comprehensive income/ (loss), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Change in unrealized gain/ (loss) on securities available for sale, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,207
|
)
|
|
—
|
|
|
(3,207
|
)
|
|||||||
Change in unrealized gain/ (loss) on cash flow hedge, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,021
|
)
|
|
—
|
|
|
(3,021
|
)
|
|||||||
Change in unrealized gain/ (loss) on other, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|||||||
Total comprehensive income/ (loss) attributable to the Company, net
|
|
|
|
|
|
|
|
|
|
|
|
|
(17,194
|
)
|
|||||||||||||
Dividends paid to common shareholders: $0.04 per share
|
—
|
|
|
—
|
|
|
(2,900
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,900
|
)
|
|||||||
Dividends paid to preferred shareholders
|
—
|
|
|
—
|
|
|
(3,099
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,099
|
)
|
|||||||
Net proceeds from issuance of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
692,569 shares of common stock
|
693
|
|
|
—
|
|
|
3,684
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,377
|
|
|||||||
4,715,000 shares of common stock in June 2010 public offering
|
4,715
|
|
|
—
|
|
|
22,021
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,736
|
|
|||||||
1,084,450 shares of common stock in June 2010 private placement
|
1,084
|
|
|
—
|
|
|
5,183
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,267
|
|
|||||||
1,050,922 shares through incentive stock grants, net of cancellations and forfeitures
|
1,051
|
|
|
—
|
|
|
(1,051
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Accretion of discount on Series C Preferred stock
|
—
|
|
|
7,988
|
|
|
(7,988
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Repurchase of 154,000 shares of Series C Preferred stock
|
—
|
|
|
(154,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(154,000
|
)
|
|||||||
Amortization of stock compensation and employee stock purchase plan
|
—
|
|
|
—
|
|
|
5,528
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,528
|
|
|||||||
Stock options exercised
|
98
|
|
|
—
|
|
|
376
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
474
|
|
|||||||
Tax deficiency from certain stock compensation awards
|
—
|
|
|
—
|
|
|
(1,613
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,613
|
)
|
|||||||
Other equity adjustments
|
—
|
|
|
—
|
|
|
3,146
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
3,148
|
|
|||||||
Balance at December 31, 2010
|
$
|
76,307
|
|
|
$
|
58,089
|
|
|
$
|
652,288
|
|
|
$
|
(269,154
|
)
|
|
$
|
1,348
|
|
|
$
|
—
|
|
|
$
|
518,878
|
|
(Continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock
|
|
Preferred
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings/
(Accumulated
Deficit)
|
|
Accumulated
Other
Comprehensive
Income/
(Loss)
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||
|
(In thousands, except share data)
|
||||||||||||||||||||||||||
Balance at December 31, 2010
|
$
|
76,307
|
|
|
$
|
58,089
|
|
|
$
|
652,288
|
|
|
$
|
(269,154
|
)
|
|
$
|
1,348
|
|
|
$
|
—
|
|
|
$
|
518,878
|
|
Comprehensive Income/ (Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income/(loss) attributable to the Company
|
—
|
|
|
—
|
|
|
—
|
|
|
39,137
|
|
|
—
|
|
|
—
|
|
|
39,137
|
|
|||||||
Other comprehensive income/ (loss), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Change in unrealized gain/ (loss) on securities available for sale, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,236
|
|
|
—
|
|
|
3,236
|
|
|||||||
Change in unrealized gain/ (loss) on cash flow hedges, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,735
|
)
|
|
—
|
|
|
(1,735
|
)
|
|||||||
Change in unrealized gain/ (loss) on other, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
745
|
|
|
—
|
|
|
745
|
|
|||||||
Total comprehensive income/ (loss) attributable to the Company, net
|
|
|
|
|
|
|
|
|
|
|
|
|
41,383
|
|
|||||||||||||
Dividends paid to common shareholders: $0.04 per share
|
—
|
|
|
—
|
|
|
(3,089
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,089
|
)
|
|||||||
Dividends paid to preferred shareholder
|
—
|
|
|
—
|
|
|
(290
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(290
|
)
|
|||||||
Net proceeds from issuance of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
828,061 shares of common stock
|
828
|
|
|
—
|
|
|
4,706
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,534
|
|
|||||||
847,532 shares of incentive stock grants, net of cancellations and forfeitures
|
848
|
|
|
—
|
|
|
(848
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Amortization of stock compensation and employee stock purchase plan
|
—
|
|
|
—
|
|
|
6,867
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,867
|
|
|||||||
Stock options exercised
|
40
|
|
|
—
|
|
|
165
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
205
|
|
|||||||
Tax deficiency from certain stock compensation awards
|
—
|
|
|
—
|
|
|
(1,706
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,706
|
)
|
|||||||
Other equity adjustments
|
—
|
|
|
—
|
|
|
(1,657
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,657
|
)
|
|||||||
Balance at December 31, 2011
|
$
|
78,023
|
|
|
$
|
58,089
|
|
|
$
|
656,436
|
|
|
$
|
(230,017
|
)
|
|
$
|
3,594
|
|
|
$
|
—
|
|
|
$
|
566,125
|
|
|
Year Ended December 31,
|
||||||||||
|
2011
|
|
2010
|
|
2009
|
||||||
|
(In thousands)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income/(loss) attributable to the Company
|
$
|
39,137
|
|
|
$
|
(10,970
|
)
|
|
$
|
5,231
|
|
Adjustments to arrive at net income/(loss) from continuing operations
|
|
|
|
|
|
||||||
Net income attributable to noncontrolling interests
|
3,216
|
|
|
2,614
|
|
|
3,649
|
|
|||
Net pre-tax (gain)/loss from operating activities of discontinued operations
|
(10,460
|
)
|
|
(6,665
|
)
|
|
(1,574
|
)
|
|||
Net pre-tax gain on sale of discontinued operations
|
—
|
|
|
—
|
|
|
(3,082
|
)
|
|||
Tax expense from discontinued operations
|
4,361
|
|
|
2,936
|
|
|
12,161
|
|
|||
Net income/(loss) from continuing operations
|
36,254
|
|
|
(12,085
|
)
|
|
16,385
|
|
|||
Adjustments to reconcile net income/(loss) from continuing operations to net cash provided by/(used in) operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
18,287
|
|
|
17,595
|
|
|
17,904
|
|
|||
Net income attributable to noncontrolling interests
|
(3,216
|
)
|
|
(2,614
|
)
|
|
(3,649
|
)
|
|||
Equity issued as compensation
|
6,867
|
|
|
5,528
|
|
|
6,943
|
|
|||
Impairment of goodwill and intangibles
|
—
|
|
|
—
|
|
|
1,699
|
|
|||
Provision for loan losses
|
13,160
|
|
|
87,178
|
|
|
44,959
|
|
|||
Loans originated for sale
|
(156,441
|
)
|
|
(210,447
|
)
|
|
(288,880
|
)
|
|||
Proceeds from sale of loans held for sale
|
154,480
|
|
|
214,523
|
|
|
290,903
|
|
|||
Gain on the repurchase of debt
|
(4,230
|
)
|
|
—
|
|
|
(18,739
|
)
|
|||
Deferred income tax expense/(benefit)
|
7,798
|
|
|
(25,981
|
)
|
|
(6,230
|
)
|
|||
Net decrease/(increase) in other operating activities
|
6,829
|
|
|
(1,535
|
)
|
|
72,466
|
|
|||
Net cash provided by/(used in) operating activities of continuing operations
|
79,788
|
|
|
72,162
|
|
|
133,761
|
|
|||
Net cash provided by/(used in) operating activities of discontinued operations
|
6,099
|
|
|
3,729
|
|
|
111,507
|
|
|||
Net cash provided by/(used in) operating activities
|
85,887
|
|
|
75,891
|
|
|
245,268
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Investment securities available for sale:
|
|
|
|
|
|
||||||
Purchases
|
(735,262
|
)
|
|
(785,644
|
)
|
|
(741,073
|
)
|
|||
Sales
|
162,728
|
|
|
434,919
|
|
|
304,822
|
|
|||
Maturities, redemptions, and principal payments
|
521,245
|
|
|
435,792
|
|
|
345,766
|
|
|||
Investment securities held to maturity:
|
|
|
|
|
|
||||||
Purchases
|
—
|
|
|
(7,279
|
)
|
|
(8,027
|
)
|
|||
Maturities, sales, and principal payments
|
—
|
|
|
9,268
|
|
|
8,026
|
|
|||
(Investments)/distributions in trusts, net
|
231
|
|
|
(547
|
)
|
|
(1,092
|
)
|
|||
(Purchase)/ redemption of Federal Home Loan Banks stock
|
2,132
|
|
|
1,644
|
|
|
—
|
|
|||
Net increase in portfolio loans
|
(208,512
|
)
|
|
(278,130
|
)
|
|
(241,493
|
)
|
|||
Proceeds from recoveries of loans previously charged-off
|
11,975
|
|
|
9,519
|
|
|
1,328
|
|
|||
Proceeds from sale of OREO
|
24,513
|
|
|
21,235
|
|
|
24,979
|
|
|||
Proceeds from sale of portfolio loans
|
—
|
|
|
18,434
|
|
|
—
|
|
|||
Proceeds from sale and repayments of non-strategic loan portfolio, net of advances
|
1,000
|
|
|
4,323
|
|
|
21,367
|
|
|||
Capital expenditures, net of sale proceeds
|
(8,969
|
)
|
|
(4,406
|
)
|
|
(5,587
|
)
|
|||
(Continued)
|
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||
|
2011
|
|
2010
|
|
2009
|
||||||
|
(In thousands)
|
||||||||||
Cash received from dispositions/ (paid for acquisitions, including deferred acquisition
obligations, net of cash acquired)
|
2,752
|
|
|
(31,525
|
)
|
|
(2,744
|
)
|
|||
Cash received from sale of discontinued operations, net of cash divested
|
—
|
|
|
—
|
|
|
79,103
|
|
|||
Net cash provided by/(used in) investing activities—continuing operations
|
(226,167
|
)
|
|
(172,397
|
)
|
|
(214,625
|
)
|
|||
Net cash provided by/(used in) investing activities—discontinued operations
|
—
|
|
|
—
|
|
|
39,626
|
|
|||
Net cash provided by/(used in) investing activities
|
(226,167
|
)
|
|
(172,397
|
)
|
|
(174,999
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Net increase in deposits
|
43,685
|
|
|
231,507
|
|
|
506,307
|
|
|||
Net (decrease)/increase in securities sold under agreements to repurchase and other
|
(127,807
|
)
|
|
15,221
|
|
|
(50,464
|
)
|
|||
Net (decrease)/increase in short-term Federal Home Loan Bank borrowings
|
(10,000
|
)
|
|
10,000
|
|
|
(134,300
|
)
|
|||
Advances of long-term Federal Home Loan Bank borrowings
|
119,313
|
|
|
177,040
|
|
|
30,777
|
|
|||
Repayments of long-term Federal Home Loan Bank borrowings
|
(163,168
|
)
|
|
(166,370
|
)
|
|
(86,937
|
)
|
|||
Repurchase of debt
|
(6,988
|
)
|
|
—
|
|
|
(76,939
|
)
|
|||
Repurchase of Series C Preferred stock
|
—
|
|
|
(154,000
|
)
|
|
—
|
|
|||
Dividends paid to common shareholders
|
(3,089
|
)
|
|
(2,900
|
)
|
|
(2,688
|
)
|
|||
Dividends paid to preferred shareholders
|
(290
|
)
|
|
(3,099
|
)
|
|
(7,862
|
)
|
|||
Tax deficiency from certain stock compensation awards
|
(1,706
|
)
|
|
(1,613
|
)
|
|
—
|
|
|||
Proceeds from stock option exercises
|
205
|
|
|
474
|
|
|
341
|
|
|||
Proceeds from issuance of common stock, net
|
1,244
|
|
|
34,077
|
|
|
769
|
|
|||
Other equity adjustments
|
(1,657
|
)
|
|
3,148
|
|
|
(6,982
|
)
|
|||
Net cash provided by/(used in) financing activities—continuing operations
|
(150,258
|
)
|
|
143,485
|
|
|
172,022
|
|
|||
Net cash provided by/(used in) financing activities—discontinued operations
|
—
|
|
|
—
|
|
|
(76,106
|
)
|
|||
Net cash provided by/(used in) financing activities
|
(150,258
|
)
|
|
143,485
|
|
|
95,916
|
|
|||
Net increase/(decrease) in cash and cash equivalents
|
(290,538
|
)
|
|
46,979
|
|
|
166,185
|
|
|||
Cash and cash equivalents at beginning of year
|
494,439
|
|
|
447,460
|
|
|
281,275
|
|
|||
Cash and cash equivalents at end of year
|
$
|
203,901
|
|
|
$
|
494,439
|
|
|
$
|
447,460
|
|
Supplementary schedule of non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
51,802
|
|
|
$
|
72,998
|
|
|
$
|
102,126
|
|
Cash paid for income taxes, net of (refunds received)
|
11,300
|
|
|
11,621
|
|
|
(76,089
|
)
|
|||
Change in unrealized gain/(loss) on securities available for sale, net of tax
|
3,236
|
|
|
(3,207
|
)
|
|
(1,785
|
)
|
|||
Change in unrealized gain/(loss) on cash flow hedges, net of tax
|
(1,735
|
)
|
|
(3,021
|
)
|
|
(1,283
|
)
|
|||
Change in unrealized gain/(loss) on other, net of tax
|
745
|
|
|
4
|
|
|
(831
|
)
|
|||
Non-cash transactions:
|
|
|
|
|
|
||||||
Held to maturity investments transferred to available for sale or other investments at fair value
|
2,515
|
|
|
—
|
|
|
—
|
|
|||
Available for sale investments transferred to other investments at fair value
|
750
|
|
|
—
|
|
|
—
|
|
|||
Loans transferred into other real estate owned from held for sale or portfolio
|
11,118
|
|
|
19,863
|
|
|
28,418
|
|
|||
Loans charged-off
|
(27,424
|
)
|
|
(66,739
|
)
|
|
(41,934
|
)
|
|||
Loans transferred into/(out of) held for sale from/(to) portfolio
|
(526
|
)
|
|
18,360
|
|
|
(1,744
|
)
|
|||
Equity issued for acquisitions, including deferred acquisition obligations
|
4,290
|
|
|
3,303
|
|
|
10,625
|
|
1.
|
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
•
|
Commercial an
d industrial
|
•
|
Commercial real estate
|
•
|
Construction and land
|
•
|
Residential mortgage
|
•
|
Home equity
|
•
|
Consumer and other
|
•
|
Deferral of principal and/or interest payments
|
•
|
Lower interest rate as compared to a new loan with comparable risk and terms
|
•
|
Extension of the maturity date
|
•
|
Reduction in the principal balance owed
|
•
|
Volume and severity of past due, nonaccrual, and adversely graded loans,
|
•
|
Volume and terms of loans,
|
•
|
Concentrations of credit,
|
•
|
Management's experience, as well as loan underwriting and loan review policy and procedures, and
|
•
|
Economic and business conditions impacting the Bank's loan portfolio, as well as consideration of collateral values and external factors
|
▪
|
Cumulative pre-tax income, as adjusted for permanent book-to-tax differences, during the 2009 through 2011 period.
|
▪
|
Deferred tax assets are expected to reverse in periods when there will be taxable income.
|
▪
|
The Company projects sufficient future taxable income to be generated by operations during the available carryforward period.
|
▪
|
Certain tax planning strategies are available, such as reducing investments in tax-exempt securities.
|
▪
|
The Company has not had any operating loss or tax credit carry-overs expiring unused in recent years.
|
|
2011
|
|
2010
|
|
2009
|
||||||
(In thousands, except share and per share data)
|
|||||||||||
Basic earnings/ (loss) per share - Numerator:
|
|
|
|
|
|
||||||
Net income/ (loss) from continuing operations
|
$
|
36,254
|
|
|
$
|
(12,085
|
)
|
|
$
|
16,385
|
|
Less: Net income attributable to noncontrolling interests
|
3,216
|
|
|
2,614
|
|
|
3,649
|
|
|||
Net income/ (loss) from continuing operations attributable to the Company
|
33,038
|
|
|
(14,699
|
)
|
|
12,736
|
|
|||
Decrease/ (increase) in noncontrolling interests' redemption values (1)
|
(515
|
)
|
|
1,321
|
|
|
(6,503
|
)
|
|||
Accretion of Beneficial Conversion Feature on Series B Preferred stock (2)
|
—
|
|
|
—
|
|
|
(24,428
|
)
|
|||
Accretion of discount on Series C Preferred stock (3)
|
—
|
|
|
(7,988
|
)
|
|
(1,438
|
)
|
|||
Dividends on preferred securities
|
(290
|
)
|
|
(3,099
|
)
|
|
(7,862
|
)
|
|||
Total adjustments to income attributable to common shareholders
|
(805
|
)
|
|
(9,766
|
)
|
|
(40,231
|
)
|
|||
Net income/ (loss) from continuing operations attributable to common shareholders
|
32,233
|
|
|
(24,465
|
)
|
|
(27,495
|
)
|
|||
Net income/ (loss) from discontinued operations
|
6,099
|
|
|
3,729
|
|
|
(7,505
|
)
|
|||
Net income/ (loss) attributable to common shareholders
|
$
|
38,332
|
|
|
$
|
(20,736
|
)
|
|
$
|
(35,000
|
)
|
Basic earnings/ (loss) per share - Denominator:
|
|
|
|
|
|
||||||
Weighted average basic common shares outstanding
|
75,169,611
|
|
|
71,321,162
|
|
|
66,696,977
|
|
|||
Per share data - Basic earnings/ (loss) per share from:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.43
|
|
|
$
|
(0.34
|
)
|
|
$
|
(0.41
|
)
|
Discontinued operations
|
$
|
0.08
|
|
|
$
|
0.05
|
|
|
$
|
(0.11
|
)
|
Total attributable to common shareholders
|
$
|
0.51
|
|
|
$
|
(0.29
|
)
|
|
$
|
(0.52
|
)
|
Diluted earnings/ (loss) per share - Numerator:
|
|
|
|
|
|
||||||
Net income/ (loss) from continuing operations attributable to common shareholders
|
$
|
32,233
|
|
|
$
|
(24,465
|
)
|
|
$
|
(27,495
|
)
|
Dividends paid on Series B Convertible Preferred stock
|
290
|
|
|
—
|
|
|
—
|
|
|||
Net income/ (loss) from continuing operations attributable to common shareholders, after assumed dilution
|
32,523
|
|
|
(24,465
|
)
|
|
(27,495
|
)
|
|||
Net income/ (loss) from discontinued operations
|
6,099
|
|
|
3,729
|
|
|
(7,505
|
)
|
|||
Net income/ (loss) attributable to common shareholders, after assumed dilution
|
$
|
38,622
|
|
|
$
|
(20,736
|
)
|
|
$
|
(35,000
|
)
|
Diluted earnings/ (loss) per share - Denominator:
|
|
|
|
|
|
||||||
Weighted average basic common shares outstanding
|
75,169,611
|
|
|
71,321,162
|
|
|
66,696,977
|
|
|||
Dilutive effect of:
|
|
|
|
|
|
||||||
Stock options, stock grants and other (4)
|
915,891
|
|
|
—
|
|
|
—
|
|
|||
Warrants to purchase common stock (4)
|
104,829
|
|
|
—
|
|
|
—
|
|
|||
Series B Convertible Preferred stock (4)
|
7,261,091
|
|
|
—
|
|
|
—
|
|
|||
Dilutive common shares
|
8,281,811
|
|
|
—
|
|
|
—
|
|
|||
Weighted average diluted common shares outstanding (4)
|
83,451,422
|
|
|
71,321,162
|
|
|
66,696,977
|
|
|||
Per share data - Diluted earnings/ (loss) per share from:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.39
|
|
|
$
|
(0.34
|
)
|
|
$
|
(0.41
|
)
|
Discontinued operations
|
$
|
0.07
|
|
|
$
|
0.05
|
|
|
$
|
(0.11
|
)
|
Total attributable to common shareholders
|
$
|
0.46
|
|
|
$
|
(0.29
|
)
|
|
$
|
(0.52
|
)
|
(1)
|
See Part II. Item 8. “Financial Statements and Supplementary Data—Note 16: Noncontrolling Interests” for a description of the redemption values related to the redeemable noncontrolling interests. In accordance with ASC 480,
Distinguishing Liabilities from Equity
(“ASC 480”), an increase in redemption values from period to period reduces income attributable to common shareholders. Decreases in redemption value from period to period increase income attributable to common shareholders, but only to the extent that the cumulative change in redemption value remains a cumulative increase since adoption of this standard in the first quarter of 2009.
|
(2)
|
See Part II. Item 8. “Financial Statements and Supplementary Data—Note 17: Equity” for description of the preferred stock issued during 2008 that gave rise to the beneficial conversion feature. The beneficial conversion feature was accounted for similar to a preferred stock dividend and reduced income attributable to common shareholders. The beneficial conversion feature on the Series B Preferred stock was fully accreted as of December 31, 2009.
|
(3)
|
See Part II. Item 8. “Financial Statements and Supplementary Data—Note 17: Equity” for a description of the Series C Preferred stock issued during 2008 that gave rise to the accretion of the discount at issuance. The accretion of the discount was accounted for similar to a preferred stock dividend and reduced income attributable to common shareholders. The Company repurchased $50.0 million of the Series C Preferred stock in January, 2010, and repurchased the remaining $104.0 million in June, 2010. The discount on the Series C Preferred stock was therefore fully accreted as of June 30, 2010.
|
(4)
|
The diluted EPS computations for the years ended
December 31, 2011
,
2010
and
2009
do not assume the conversion, exercise or contingent issuance of of the following shares for the following periods because the result would have been antidilutive for the periods indicated. As a result of the anti-dilution, the potential common shares excluded from the diluted EPS computation are as follows:
|
|
2011
|
|
2010
|
|
2009
|
|||
(In thousands)
|
||||||||
Shares excluded due to anti-dilution (treasury method):
|
|
|
|
|
|
|||
Potential common shares from:
|
|
|
|
|
|
|||
Convertible trust preferred securities (a)
|
1,504
|
|
|
1,860
|
|
|
3,086
|
|
Conversion of the Series B Preferred stock (b)
|
—
|
|
|
7,261
|
|
|
7,261
|
|
Exercise or contingent issuance of options, restricted stock, or other dilutive securities (c)
|
—
|
|
|
1,233
|
|
|
888
|
|
Exercise or contingent issuance of warrants (d)
|
—
|
|
|
105
|
|
|
—
|
|
Total shares excluded due to anti-dilution
|
1,504
|
|
|
10,459
|
|
|
11,235
|
|
|
|
|
|
|
|
|||
Shares excluded due to exercise price exceeding the average market price of common shares during the period (total outstanding):
|
|
|
|
|
|
|||
Potential common shares from:
|
|
|
|
|
|
|||
Options, restricted stock, or other dilutive securities (c)
|
3,845
|
|
|
4,161
|
|
|
5,254
|
|
Warrants (d)
|
2,888
|
|
|
2,888
|
|
|
8,331
|
|
Total shares excluded due to exercise price exceeding the average market price of common shares during the period
|
6,733
|
|
|
7,049
|
|
|
13,585
|
|
(a)
|
If the effect of the conversion of the trust preferred securities would have been dilutive, interest expense, net of tax, related to the convertible trust preferred securities of $1.6 million, $1.7 million and $2.8 million for the years ended
December 31, 2011
,
2010
and
2009
, respectively, would have been added back to net income/ (loss) attributable to common shareholders for diluted EPS computations for the periods presented.
|
(b)
|
If the effect of the conversion of the Series B Preferred stock would have been dilutive for the years ended
December 31, 2010
and
2009
, preferred dividends related to the Series B Preferred stock of $0.3 million for both of those periods would have been added back to net income/ (loss) attributable to common shareholders for diluted EPS computations for the periods presented.
|
(c)
|
Options to purchase shares of common stock that were outstanding at period ends were not included in the computation of diluted EPS or in the above anti-dilution table because the options’ exercise prices were greater than the average market price of the common shares during the respective period. Shares excluded from the diluted EPS computation are listed in the second table above for each respective period.
|
(d)
|
Certain warrants to purchase shares of common stock that were outstanding at period ends were not included in the computations of diluted EPS because the warrants' exercise price was greater than the average market price of the common shares during the respective period. Shares excluded from the diluted EPS computation are listed in the second table above for each respective period. See Part II. Item 8. "Financial Statements and Supplementary Data—Note 27: Subsequent Events" for a discussion of the 2012 repurchase of the Carlyle Warrants and the Carlyle Director's Warrants.
|
2.
|
RESTRUCTURING
|
|
Severance Charges
|
|
Contract Termination Fees
|
|
Professional Expenses
|
|
Other Associated Costs
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Accrued charges at December 31, 2010
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Costs incurred
|
3,947
|
|
|
871
|
|
|
2,539
|
|
|
698
|
|
|
8,055
|
|
|||||
Costs paid
|
(1,289
|
)
|
|
(660
|
)
|
|
(2,309
|
)
|
|
(698
|
)
|
|
(4,956
|
)
|
|||||
Accrued charges at December 31, 2011
|
$
|
2,658
|
|
|
$
|
211
|
|
|
$
|
230
|
|
|
$
|
—
|
|
|
$
|
3,099
|
|
3.
|
DIVESTITURES AND ACQUISITIONS
|
|
Westfield
|
|
Gibraltar
|
|
RINET
|
|
Sand Hill
|
|
BPVI
|
|
Total
|
||||||||||||
(In thousands)
|
|||||||||||||||||||||||
2009
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenues (1)
|
$
|
59,289
|
|
|
$
|
38,572
|
|
|
$
|
5,471
|
|
|
$
|
2,414
|
|
|
$
|
909
|
|
|
$
|
106,655
|
|
Pre-tax (loss)/ income from operations
|
$
|
18,167
|
|
|
$
|
(16,039
|
)
|
|
$
|
313
|
|
|
$
|
(735
|
)
|
|
$
|
(132
|
)
|
|
$
|
1,574
|
|
Pre-tax gain/(loss) on sale (2)
|
47,967
|
|
|
(44,300
|
)
|
|
1,909
|
|
|
(172
|
)
|
|
(2,322
|
)
|
|
3,082
|
|
||||||
Income tax expense/(benefit)
|
28,525
|
|
|
(17,469
|
)
|
|
1,657
|
|
|
(5
|
)
|
|
(547
|
)
|
|
12,161
|
|
||||||
Net (loss)/income from discontinued operations
|
$
|
37,609
|
|
|
$
|
(42,870
|
)
|
|
$
|
565
|
|
|
$
|
(902
|
)
|
|
$
|
(1,907
|
)
|
|
$
|
(7,505
|
)
|
(1)
|
Revenues include net interest income, fees and other income.
|
(2)
|
Includes pre-tax intangible and goodwill impairment charges, if any, resulting from the remeasurement of the affiliates’ fair value at the time of divestiture.
|
4.
|
COMPREHENSIVE AND ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS)
|
|
Other comprehensive income/(loss):
|
||||||||||
Pre-tax
|
|
Tax expense/
(benefit)
|
|
Net
|
|||||||
|
(In thousands)
|
||||||||||
2011
|
|
|
|
|
|
||||||
Unrealized gain/ (loss) on securities available for sale
|
$
|
5,987
|
|
|
$
|
2,261
|
|
|
$
|
3,726
|
|
Less: Adjustment for realized gains, net
|
798
|
|
|
308
|
|
|
490
|
|
|||
Net unrealized gain/ (loss) on securities available for sale
|
5,189
|
|
|
1,953
|
|
|
3,236
|
|
|||
Unrealized gain/ (loss) on cash flow hedge
|
(4,838
|
)
|
|
(2,008
|
)
|
|
(2,830
|
)
|
|||
Add: scheduled reclass and other
|
1,872
|
|
|
777
|
|
|
1,095
|
|
|||
Net unrealized gain/ (loss) on cash flow hedge
|
(2,966
|
)
|
|
(1,231
|
)
|
|
(1,735
|
)
|
|||
Unrealized gain/ (loss) on other
|
78
|
|
|
30
|
|
|
48
|
|
|||
Less: adjustment for realized expenses
|
(1,074
|
)
|
|
(377
|
)
|
|
(697
|
)
|
|||
Net unrealized gain/ (loss) on other
|
1,152
|
|
|
407
|
|
|
745
|
|
|||
Other comprehensive gain/ (loss)
|
3,375
|
|
|
1,129
|
|
|
2,246
|
|
|||
Net income/ (loss) attributable to the Company (1)
|
53,504
|
|
|
14,367
|
|
|
39,137
|
|
|||
Total comprehensive income/ (loss)
|
$
|
56,879
|
|
|
$
|
15,496
|
|
|
$
|
41,383
|
|
2010
|
|
|
|
|
|
||||||
Unrealized gain/ (loss) on securities available for sale
|
$
|
(1,506
|
)
|
|
$
|
(494
|
)
|
|
$
|
(1,012
|
)
|
Less: Adjustment for realized gains, net
|
3,649
|
|
|
1,454
|
|
|
2,195
|
|
|||
Net unrealized gain/ (loss) on securities available for sale
|
(5,155
|
)
|
|
(1,948
|
)
|
|
(3,207
|
)
|
|||
Unrealized gain/ (loss) on cash flow hedges
|
(2,254
|
)
|
|
(825
|
)
|
|
(1,429
|
)
|
|||
Add: scheduled reclass and other
|
(2,511
|
)
|
|
(919
|
)
|
|
(1,592
|
)
|
|||
Net unrealized gain/ (loss) on cash flow hedges
|
(4,765
|
)
|
|
(1,744
|
)
|
|
(3,021
|
)
|
|||
Unrealized gain/ (loss) on other
|
(469
|
)
|
|
(189
|
)
|
|
(280
|
)
|
|||
Less: adjustment for realized expenses
|
(476
|
)
|
|
(192
|
)
|
|
(284
|
)
|
|||
Net unrealized gain/ (loss) on other
|
7
|
|
|
3
|
|
|
4
|
|
|||
Other comprehensive gain/ (loss)
|
(9,913
|
)
|
|
(3,689
|
)
|
|
(6,224
|
)
|
|||
Net income/ (loss) attributable to the Company (1)
|
(30,421
|
)
|
|
(19,451
|
)
|
|
(10,970
|
)
|
|||
Total comprehensive income/ (loss)
|
$
|
(40,334
|
)
|
|
$
|
(23,140
|
)
|
|
$
|
(17,194
|
)
|
2009
|
|
|
|
|
|
||||||
Unrealized gain/ (loss) on securities available for sale
|
$
|
2,802
|
|
|
$
|
1,074
|
|
|
$
|
1,728
|
|
Less: Adjustment for realized gains, net
|
5,803
|
|
|
2,290
|
|
|
3,513
|
|
|||
Net unrealized gain/ (loss) on securities available for sale
|
(3,001
|
)
|
|
(1,216
|
)
|
|
(1,785
|
)
|
|||
Unrealized gain/ (loss) on cash flow hedges
|
674
|
|
|
309
|
|
|
365
|
|
|||
Add: scheduled reclass and other
|
(3,047
|
)
|
|
(1,399
|
)
|
|
(1,648
|
)
|
|||
Net unrealized gain/ (loss) on cash flow hedges
|
(2,373
|
)
|
|
(1,090
|
)
|
|
(1,283
|
)
|
|||
Unrealized gain/ (loss) on other
|
(1,763
|
)
|
|
(932
|
)
|
|
(831
|
)
|
|||
Other comprehensive gain/ (loss)
|
(7,137
|
)
|
|
(3,238
|
)
|
|
(3,899
|
)
|
|||
Net income/ (loss) attributable to the Company (1)
|
6,863
|
|
|
1,632
|
|
|
5,231
|
|
|||
Total comprehensive income/ (loss)
|
$
|
(274
|
)
|
|
$
|
(1,606
|
)
|
|
$
|
1,332
|
|
(1)
|
Pre-tax net income/(loss) attributable to the Company is calculated as income/ (loss) before income taxes, plus net income/ (loss) from discontinued operations, less net income/ (loss) attributable to noncontrolling interests.
|
|
2011
|
|
2010
|
|
2009
|
||||||
(In thousands)
|
|||||||||||
Unrealized gain/ (loss) on securities available for sale, net of tax
|
$
|
6,883
|
|
|
$
|
3,647
|
|
|
$
|
6,854
|
|
Unrealized gain/ (loss) on cash flow hedges, net of tax
|
(3,106
|
)
|
|
(1,371
|
)
|
|
1,650
|
|
|||
Unrealized gain/ (loss) on other, net of tax
|
(183
|
)
|
|
(928
|
)
|
|
(932
|
)
|
|||
Accumulated other comprehensive income/ (loss)
|
$
|
3,594
|
|
|
$
|
1,348
|
|
|
$
|
7,572
|
|
5.
|
REPORTABLE SEGMENTS
|
|
For the year ended December 31,
|
||||||||||||||||||||||||||||||||||
|
Net interest income
|
|
Non-interest income
|
|
Total revenues
|
||||||||||||||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||||||||||||
Total Bank(s) (1)
|
$
|
186,006
|
|
|
$
|
190,104
|
|
|
$
|
169,802
|
|
|
$
|
38,738
|
|
|
$
|
36,084
|
|
|
$
|
38,521
|
|
|
$
|
224,744
|
|
|
$
|
226,188
|
|
|
$
|
208,323
|
|
Total Investment Managers
|
74
|
|
|
144
|
|
|
177
|
|
|
39,802
|
|
|
36,976
|
|
|
33,192
|
|
|
39,876
|
|
|
37,120
|
|
|
33,369
|
|
|||||||||
Total Wealth Advisors
|
17
|
|
|
(11
|
)
|
|
70
|
|
|
41,082
|
|
|
37,876
|
|
|
34,810
|
|
|
41,099
|
|
|
37,865
|
|
|
34,880
|
|
|||||||||
Total Segments
|
186,097
|
|
|
190,237
|
|
|
170,049
|
|
|
119,622
|
|
|
110,936
|
|
|
106,523
|
|
|
305,719
|
|
|
301,173
|
|
|
276,572
|
|
|||||||||
Holding Company and Eliminations
|
(7,153
|
)
|
|
(9,512
|
)
|
|
(10,564
|
)
|
|
5,348
|
|
|
836
|
|
|
19,926
|
|
|
(1,805
|
)
|
|
(8,676
|
)
|
|
9,362
|
|
|||||||||
Total Company
|
$
|
178,944
|
|
|
$
|
180,725
|
|
|
$
|
159,485
|
|
|
$
|
124,970
|
|
|
$
|
111,772
|
|
|
$
|
126,449
|
|
|
$
|
303,914
|
|
|
$
|
292,497
|
|
|
$
|
285,934
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
For the year ended December 31,
|
||||||||||||||||||||||||||||||||||
|
Non-interest expense (2)
|
|
Income tax expense/(benefit) (3)
|
|
Net income/(loss) from
continuing operations
|
||||||||||||||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||||||||||||
Total Bank(s)
|
$
|
151,768
|
|
|
$
|
149,996
|
|
|
$
|
144,713
|
|
|
$
|
19,697
|
|
|
$
|
(10,219
|
)
|
|
$
|
4,746
|
|
|
$
|
40,119
|
|
|
$
|
(767
|
)
|
|
$
|
13,905
|
|
Total Investment Managers
|
31,181
|
|
|
29,720
|
|
|
28,221
|
|
|
2,803
|
|
|
2,682
|
|
|
2,236
|
|
|
5,892
|
|
|
4,718
|
|
|
2,912
|
|
|||||||||
Total Wealth Advisors
|
31,472
|
|
|
29,899
|
|
|
25,855
|
|
|
3,526
|
|
|
2,982
|
|
|
3,573
|
|
|
6,101
|
|
|
4,984
|
|
|
5,452
|
|
|||||||||
Total Segments
|
214,421
|
|
|
209,615
|
|
|
198,789
|
|
|
26,026
|
|
|
(4,555
|
)
|
|
10,555
|
|
|
52,112
|
|
|
8,935
|
|
|
22,269
|
|
|||||||||
Holding Company and Eliminations
|
25,712
|
|
|
27,240
|
|
|
24,169
|
|
|
(11,659
|
)
|
|
(14,896
|
)
|
|
(8,923
|
)
|
|
(15,858
|
)
|
|
(21,020
|
)
|
|
(5,884
|
)
|
|||||||||
Total Company
|
$
|
240,133
|
|
|
$
|
236,855
|
|
|
$
|
222,958
|
|
|
$
|
14,367
|
|
|
$
|
(19,451
|
)
|
|
$
|
1,632
|
|
|
$
|
36,254
|
|
|
$
|
(12,085
|
)
|
|
$
|
16,385
|
|
|
For the year ended December 31,
|
||||||||||||||||||||||||||||||||||
|
Net income from continuing
operations attributable to
noncontrolling interests
|
|
Net income/(loss) attributable to
the Company
|
|
Amortization of intangibles
|
||||||||||||||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|||||||||||||||||||
(In thousands)
|
|||||||||||||||||||||||||||||||||||
Total Bank(s)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
40,119
|
|
|
$
|
(767
|
)
|
|
$
|
13,905
|
|
|
$
|
404
|
|
|
$
|
286
|
|
|
$
|
2,724
|
|
Total Investment Managers
|
1,727
|
|
|
1,383
|
|
|
997
|
|
|
4,165
|
|
|
3,335
|
|
|
1,915
|
|
|
3,319
|
|
|
3,477
|
|
|
3,955
|
|
|||||||||
Total Wealth Advisors
|
1,489
|
|
|
1,231
|
|
|
2,652
|
|
|
4,612
|
|
|
3,753
|
|
|
2,800
|
|
|
1,291
|
|
|
1,395
|
|
|
1,502
|
|
|||||||||
Total Segments
|
3,216
|
|
|
2,614
|
|
|
3,649
|
|
|
48,896
|
|
|
6,321
|
|
|
18,620
|
|
|
5,014
|
|
|
5,158
|
|
|
8,181
|
|
|||||||||
Holding Company and Eliminations (4)
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,759
|
)
|
|
(17,291
|
)
|
|
(13,389
|
)
|
|
—
|
|
|
106
|
|
|
108
|
|
|||||||||
Total Company
|
$
|
3,216
|
|
|
$
|
2,614
|
|
|
$
|
3,649
|
|
|
$
|
39,137
|
|
|
$
|
(10,970
|
)
|
|
$
|
5,231
|
|
|
$
|
5,014
|
|
|
$
|
5,264
|
|
|
$
|
8,289
|
|
|
As of December 31,
|
||||||||||||||||||||||
Assets
|
|
AUM (5)
|
|||||||||||||||||||||
2011
|
|
2010
|
|
2009
|
|
2011
|
|
2010
|
|
2009
|
|||||||||||||
(In thousands)
|
|
(In millions)
|
|||||||||||||||||||||
Total Bank(s)
|
$
|
5,843,089
|
|
|
$
|
5,948,100
|
|
|
$
|
5,669,645
|
|
|
$
|
3,571
|
|
|
$
|
3,592
|
|
|
$
|
3,479
|
|
Total Investment Managers
|
105,629
|
|
|
114,614
|
|
|
112,497
|
|
|
7,594
|
|
|
8,140
|
|
|
7,048
|
|
||||||
Total Wealth Advisors
|
80,762
|
|
|
76,774
|
|
|
72,062
|
|
|
7,979
|
|
|
7,836
|
|
|
7,161
|
|
||||||
Total Segments
|
6,029,480
|
|
|
6,139,488
|
|
|
5,854,204
|
|
|
19,144
|
|
|
19,568
|
|
|
17,688
|
|
||||||
Holding Company and Eliminations
|
18,892
|
|
|
13,413
|
|
|
195,061
|
|
|
(19
|
)
|
|
(19
|
)
|
|
(18
|
)
|
||||||
Total Company
|
$
|
6,048,372
|
|
|
$
|
6,152,901
|
|
|
$
|
6,049,265
|
|
|
$
|
19,125
|
|
|
$
|
19,549
|
|
|
$
|
17,670
|
|
(1)
|
In the second quarter of 2011, the Company merged its four Private Banking affiliates into one bank operating under the charter of Boston Private Bank. See Part II. Item 8. "Financial Statements and Supplementary Data-Note 2: Restructuring" for additional details.
|
(2)
|
Non-interest expense for 2011 includes $8.1 million of restructuring expenses. Restructuring expenses incurred by the Private Banking segment amounted to $5.5 million, with the remaining $2.6 million incurred by the Holding Company.
|
(3)
|
The Company's effective tax rate for 2011, 2010 and 2009 are not consistent due to earnings from tax-exempt investments, non-deductible compensation, state and local taxes, income tax credits and income attributable to noncontrolling interests having a different impact on the effective tax rate due primarily to the different levels of income or loss before taxes in years 2011, 2010 and 2009. See Part II. Item 8. "Financial Statements and Supplementary Data - Note 18: Income Taxes" for additional details.
|
(4)
|
Net income/ (loss) from discontinued operations for the years ended
December 31, 2011
and
2010
of income of
$6.1 million
and
$3.7 million
, respectively, and a loss
$7.5 million
for the year ended
December 31, 2009
, are included in Holding Company and Eliminations in the calculation of net loss attributable to the Company.
|
(5)
|
"AUM" represents Assets Under Management and Advisory at the affiliates.
|
6.
|
INVESTMENT SECURITIES
|
|
Amortized
Cost
|
|
Unrealized
|
|
Fair
Value
|
||||||||||
Gains
|
|
Losses
|
|
||||||||||||
(In thousands)
|
|||||||||||||||
At December 31, 2011:
|
|
|
|
|
|
|
|
||||||||
Available for sale securities at fair value:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
4,904
|
|
|
$
|
20
|
|
|
$
|
(21
|
)
|
|
$
|
4,903
|
|
Government-sponsored entities
|
380,805
|
|
|
1,493
|
|
|
(90
|
)
|
|
382,208
|
|
||||
Corporate bonds
|
4,953
|
|
|
—
|
|
|
(41
|
)
|
|
4,912
|
|
||||
Municipal bonds
|
196,961
|
|
|
3,733
|
|
|
(19
|
)
|
|
200,675
|
|
||||
Mortgage-backed securities (1)
|
248,329
|
|
|
6,403
|
|
|
(388
|
)
|
|
254,344
|
|
||||
Other
|
474
|
|
|
95
|
|
|
(29
|
)
|
|
540
|
|
||||
Total
|
$
|
836,426
|
|
|
$
|
11,744
|
|
|
$
|
(588
|
)
|
|
$
|
847,582
|
|
At December 31, 2010:
|
|
|
|
|
|
|
|
||||||||
Available for sale securities at fair value:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
81,444
|
|
|
$
|
22
|
|
|
$
|
(64
|
)
|
|
$
|
81,402
|
|
Government-sponsored entities
|
263,460
|
|
|
1,278
|
|
|
(1,139
|
)
|
|
263,599
|
|
||||
Corporate bonds
|
18,881
|
|
|
39
|
|
|
(104
|
)
|
|
18,816
|
|
||||
Municipal bonds
|
192,139
|
|
|
2,934
|
|
|
(1,025
|
)
|
|
194,048
|
|
||||
Mortgage-backed securities (1)
|
230,352
|
|
|
5,334
|
|
|
(1,429
|
)
|
|
234,257
|
|
||||
Other
|
3,195
|
|
|
151
|
|
|
(30
|
)
|
|
3,316
|
|
||||
Total
|
$
|
789,471
|
|
|
$
|
9,758
|
|
|
$
|
(3,791
|
)
|
|
$
|
795,438
|
|
Held to maturity securities at amortized cost:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
586
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
586
|
|
Government-sponsored entities
|
1,429
|
|
|
5
|
|
|
(23
|
)
|
|
1,411
|
|
||||
Other
|
500
|
|
|
—
|
|
|
—
|
|
|
500
|
|
||||
Total
|
$
|
2,515
|
|
|
$
|
5
|
|
|
$
|
(23
|
)
|
|
$
|
2,497
|
|
(1)
|
All mortgage-backed securities are guaranteed by U.S. government agencies or Government-sponsored entities.
|
|
U.S. government and agencies (1)
|
|
Government-sponsored entities (1)
|
||||||||||||||||||
Amortized
cost
|
|
Fair
value
|
|
Weighted
average
yield
|
|
Amortized
cost
|
|
Fair
value
|
|
Weighted
average
yield
|
|||||||||||
(In thousands)
|
|||||||||||||||||||||
Within one year
|
$
|
1,300
|
|
|
$
|
1,303
|
|
|
0.54
|
%
|
|
$
|
5,849
|
|
|
$
|
5,854
|
|
|
0.29
|
%
|
After one, but within five years
|
—
|
|
|
—
|
|
|
—
|
%
|
|
348,072
|
|
|
349,390
|
|
|
1.22
|
%
|
||||
After five, but within ten years
|
3,604
|
|
|
3,600
|
|
|
3.69
|
%
|
|
22,760
|
|
|
22,841
|
|
|
1.66
|
%
|
||||
Greater than ten years
|
—
|
|
|
—
|
|
|
—
|
%
|
|
4,124
|
|
|
4,123
|
|
|
1.31
|
%
|
||||
Total
|
$
|
4,904
|
|
|
$
|
4,903
|
|
|
2.85
|
%
|
|
$
|
380,805
|
|
|
$
|
382,208
|
|
|
1.24
|
%
|
|
Corporate bonds (1)
|
|
Municipal bonds (1)
|
||||||||||||||||||
Amortized
cost
|
|
Fair
value
|
|
Weighted
average
yield
|
|
Amortized
cost
|
|
Fair
value
|
|
Weighted
average
yield (3)
|
|||||||||||
(In thousands)
|
|||||||||||||||||||||
Within one year
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
12,000
|
|
|
$
|
12,037
|
|
|
2.15
|
%
|
After one, but within five years
|
—
|
|
|
—
|
|
|
—
|
%
|
|
146,290
|
|
|
149,276
|
|
|
2.55
|
%
|
||||
After five, but within ten years
|
—
|
|
|
—
|
|
|
—
|
%
|
|
32,483
|
|
|
33,115
|
|
|
3.03
|
%
|
||||
Greater than ten years
|
4,953
|
|
|
4,912
|
|
|
2.48
|
%
|
|
6,188
|
|
|
6,247
|
|
|
3.93
|
%
|
||||
Total
|
$
|
4,953
|
|
|
$
|
4,912
|
|
|
2.48
|
%
|
|
$
|
196,961
|
|
|
$
|
200,675
|
|
|
2.65
|
%
|
|
Mortgage-backed securities (2)
|
|
Other
|
||||||||||||||||||
Amortized
cost
|
|
Fair
value
|
|
Weighted
average
yield
|
|
Amortized
cost
|
|
Fair
value
|
|
Weighted
average
yield
|
|||||||||||
(In thousands)
|
|||||||||||||||||||||
Within one year
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
474
|
|
|
$
|
540
|
|
|
—
|
%
|
After one, but within five years
|
4,623
|
|
|
4,734
|
|
|
3.80
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
After five, but within ten years
|
24,422
|
|
|
24,787
|
|
|
1.92
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Greater than ten years
|
219,284
|
|
|
224,823
|
|
|
2.89
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Total
|
$
|
248,329
|
|
|
$
|
254,344
|
|
|
2.81
|
%
|
|
$
|
474
|
|
|
$
|
540
|
|
|
—
|
%
|
(1)
|
Certain securities are callable before their final maturity.
|
(2)
|
Mortgage-backed securities are shown based on their final (contractual) maturity, but, due to prepayments and amortization, they are expected to have shorter lives.
|
(3)
|
Yield shown on a fully taxable equivalent (FTE) basis.
|
|
Year ended December 31,
|
||||||||||
2011
|
|
2010
|
|
2009
|
|||||||
(In thousands)
|
|||||||||||
Proceeds from sales
|
$
|
162,728
|
|
|
$
|
434,919
|
|
|
$
|
304,822
|
|
Realized gains
|
1,406
|
|
|
3,867
|
|
|
5,962
|
|
|||
Realized losses
|
(608
|
)
|
|
(218
|
)
|
|
(159
|
)
|
|
Year ended December 31, 2010
|
||
|
(In thousands)
|
||
Proceeds from sales
|
$
|
507
|
|
Realized gains
|
5
|
|
|
Realized losses
|
(1
|
)
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
|||||||||||||||||||||
|
Fair
value
|
|
Unrealized
losses
|
|
Fair
value
|
|
Unrealized
losses
|
|
Fair
value
|
|
Unrealized
losses
|
|
# of
securities
|
|||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||||
December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Available for sale securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
U.S. government and agencies
|
$
|
1,501
|
|
|
$
|
(21
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,501
|
|
|
$
|
(21
|
)
|
|
1
|
|
Government-sponsored entities
|
72,031
|
|
|
(90
|
)
|
|
140
|
|
|
—
|
|
|
72,171
|
|
|
(90
|
)
|
|
12
|
|
||||||
Corporate bonds
|
4,913
|
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|
4,913
|
|
|
(41
|
)
|
|
1
|
|
||||||
Municipal bonds
|
7,030
|
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|
7,030
|
|
|
(19
|
)
|
|
5
|
|
||||||
Mortgage-backed securities
|
41,448
|
|
|
(361
|
)
|
|
2,998
|
|
|
(27
|
)
|
|
44,446
|
|
|
(388
|
)
|
|
12
|
|
||||||
Other
|
129
|
|
|
(27
|
)
|
|
29
|
|
|
(2
|
)
|
|
158
|
|
|
(29
|
)
|
|
21
|
|
||||||
Total
|
$
|
127,052
|
|
|
$
|
(559
|
)
|
|
$
|
3,167
|
|
|
$
|
(29
|
)
|
|
$
|
130,219
|
|
|
$
|
(588
|
)
|
|
52
|
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
|||||||||||||||||||||
|
Fair
value
|
|
Unrealized
losses
|
|
Fair
value
|
|
Unrealized
losses
|
|
Fair
value
|
|
Unrealized
losses
|
|
# of
securities
|
|||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||||
December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Available for sale securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
U.S. government and agencies
|
$
|
68,057
|
|
|
$
|
(64
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
68,057
|
|
|
$
|
(64
|
)
|
|
9
|
|
Government-sponsored entities
|
119,175
|
|
|
(1,139
|
)
|
|
—
|
|
|
—
|
|
|
119,175
|
|
|
(1,139
|
)
|
|
26
|
|
||||||
Corporate bonds
|
13,647
|
|
|
(104
|
)
|
|
—
|
|
|
—
|
|
|
13,647
|
|
|
(104
|
)
|
|
3
|
|
||||||
Municipal bonds
|
59,785
|
|
|
(1,025
|
)
|
|
—
|
|
|
—
|
|
|
59,785
|
|
|
(1,025
|
)
|
|
48
|
|
||||||
Mortgage-backed securities
|
86,721
|
|
|
(1,429
|
)
|
|
—
|
|
|
—
|
|
|
86,721
|
|
|
(1,429
|
)
|
|
33
|
|
||||||
Other
|
12
|
|
|
(1
|
)
|
|
94
|
|
|
(29
|
)
|
|
106
|
|
|
(30
|
)
|
|
18
|
|
||||||
Total
|
$
|
347,397
|
|
|
$
|
(3,762
|
)
|
|
$
|
94
|
|
|
$
|
(29
|
)
|
|
$
|
347,491
|
|
|
$
|
(3,791
|
)
|
|
137
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Held to maturity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Government-sponsored entities
|
$
|
977
|
|
|
$
|
(23
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
977
|
|
|
$
|
(23
|
)
|
|
5
|
|
|
Amortized cost
|
|
Fair value
|
||||
(In thousands)
|
|||||||
Federal National Mortgage Association
|
$
|
256,914
|
|
|
$
|
258,871
|
|
Government National Mortgage Association
|
160,035
|
|
|
164,321
|
|
||
Federal Home Loan Mortgage Corporation
|
114,090
|
|
|
114,737
|
|
||
Total
|
$
|
531,039
|
|
|
$
|
537,929
|
|
7.
|
LOANS RECEIVABLE AND CREDIT QUALITY
|
|
As of December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Commercial and industrial
|
$
|
687,102
|
|
|
$
|
658,147
|
|
Commercial real estate
|
1,669,220
|
|
|
1,698,086
|
|
||
Construction and land
|
153,709
|
|
|
150,702
|
|
||
Residential
|
1,823,403
|
|
|
1,673,934
|
|
||
Home equity
|
143,698
|
|
|
158,430
|
|
||
Consumer and other
|
173,096
|
|
|
141,048
|
|
||
Total Loans
|
$
|
4,650,228
|
|
|
$
|
4,480,347
|
|
|
As of December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Commercial and industrial
|
$
|
3,759
|
|
|
$
|
8,583
|
|
Commercial real estate
|
38,581
|
|
|
66,518
|
|
||
Construction and land (1)
|
7,772
|
|
|
15,323
|
|
||
Residential
|
17,513
|
|
|
14,111
|
|
||
Home equity
|
457
|
|
|
799
|
|
||
Consumer and other
|
27
|
|
|
131
|
|
||
Total
|
$
|
68,109
|
|
|
$
|
105,465
|
|
(1)
|
Does not include a nonaccrual construction and land loan held for sale of $1.5 million as of December 31, 2010. This loan was the one remaining loan in the Company's non-strategic Southern California loans held for sale portfolio.
|
|
As of December 31, 2011
|
||||||||||||||||||||||||||||||||||
|
Accruing Past Due
|
|
Nonaccrual Loans
|
|
|
|
|
||||||||||||||||||||||||||||
|
30-59 Days Days Past Due
|
|
60-89 Days Days Past Due
|
|
Total Accruing Past Due (1)
|
|
Current Payment Status
|
|
30-89 Days Past Due
|
|
90 Days or Greater Past Due
|
|
Total Non- accrual Loans
|
|
Current Accruing Loans
|
|
Total Loans Receivable
|
||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||||||||
Commercial and industrial
|
$
|
1,284
|
|
|
$
|
364
|
|
|
$
|
1,648
|
|
|
$
|
2,866
|
|
|
$
|
566
|
|
|
$
|
327
|
|
|
$
|
3,759
|
|
|
$
|
681,695
|
|
|
$
|
687,102
|
|
Commercial real estate
|
6,779
|
|
|
2,136
|
|
|
8,915
|
|
|
32,096
|
|
|
2,310
|
|
|
4,175
|
|
|
38,581
|
|
|
1,621,724
|
|
|
1,669,220
|
|
|||||||||
Construction and land
|
48
|
|
|
26
|
|
|
106
|
|
|
4,825
|
|
|
172
|
|
|
2,775
|
|
|
7,772
|
|
|
145,831
|
|
|
153,709
|
|
|||||||||
Residential
|
8,997
|
|
|
5,410
|
|
|
14,407
|
|
|
7,236
|
|
|
1,849
|
|
|
8,428
|
|
|
17,513
|
|
|
1,791,483
|
|
|
1,823,403
|
|
|||||||||
Home equity
|
1,223
|
|
|
—
|
|
|
1,223
|
|
|
131
|
|
|
—
|
|
|
326
|
|
|
457
|
|
|
142,018
|
|
|
143,698
|
|
|||||||||
Consumer and other
|
689
|
|
|
1
|
|
|
690
|
|
|
3
|
|
|
—
|
|
|
24
|
|
|
27
|
|
|
172,379
|
|
|
173,096
|
|
|||||||||
Total
|
$
|
19,020
|
|
|
$
|
7,937
|
|
|
$
|
26,989
|
|
|
$
|
47,157
|
|
|
$
|
4,897
|
|
|
$
|
16,055
|
|
|
$
|
68,109
|
|
|
$
|
4,555,130
|
|
|
$
|
4,650,228
|
|
(1)
|
Includes an additional $32 thousand of accruing construction and land loans that are 90 days or greater past due.
|
|
As of December 31, 2010
|
||||||||||||||||||||||
|
Accruing Past Due
|
|
|
|
|
|
|
||||||||||||||||
|
30-59 Days Days Past Due
|
|
60-89 Days Days Past Due
|
|
Total Accruing Past Due
|
|
Nonaccrual Loans (1) (2)
|
|
Current Accruing Loans
|
|
Total Loans Receivable
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
4,819
|
|
|
$
|
2,637
|
|
|
$
|
7,456
|
|
|
$
|
8,583
|
|
|
$
|
642,108
|
|
|
$
|
658,147
|
|
Commercial real estate
|
4,463
|
|
|
5,983
|
|
|
10,446
|
|
|
66,518
|
|
|
1,621,122
|
|
|
1,698,086
|
|
||||||
Construction and land
|
—
|
|
|
—
|
|
|
—
|
|
|
15,323
|
|
|
135,379
|
|
|
150,702
|
|
||||||
Residential
|
6,050
|
|
|
503
|
|
|
6,553
|
|
|
14,111
|
|
|
1,653,270
|
|
|
1,673,934
|
|
||||||
Home equity
|
237
|
|
|
—
|
|
|
237
|
|
|
799
|
|
|
157,394
|
|
|
158,430
|
|
||||||
Consumer and other
|
19
|
|
|
34
|
|
|
53
|
|
|
131
|
|
|
140,864
|
|
|
141,048
|
|
||||||
Total
|
$
|
15,588
|
|
|
$
|
9,157
|
|
|
$
|
24,745
|
|
|
$
|
105,465
|
|
|
$
|
4,350,137
|
|
|
$
|
4,480,347
|
|
|
As of December 31, 2011
|
||||||||||||||||||
|
By Loan Grade or Nonaccrual Status
|
|
|
||||||||||||||||
|
Pass
|
|
Special Mention
|
|
Accruing Classified (1)
|
|
Nonaccrual Loans
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Commercial and industrial
|
$
|
641,831
|
|
|
$
|
19,263
|
|
|
$
|
22,249
|
|
|
$
|
3,759
|
|
|
$
|
687,102
|
|
Commercial real estate
|
1,454,786
|
|
|
112,748
|
|
|
63,105
|
|
|
38,581
|
|
|
1,669,220
|
|
|||||
Construction and land
|
131,205
|
|
|
10,978
|
|
|
3,754
|
|
|
7,772
|
|
|
153,709
|
|
|||||
Residential
|
1,798,635
|
|
|
—
|
|
|
7,255
|
|
|
17,513
|
|
|
1,823,403
|
|
|||||
Home equity
|
141,373
|
|
|
—
|
|
|
1,868
|
|
|
457
|
|
|
143,698
|
|
|||||
Consumer and other
|
172,927
|
|
|
132
|
|
|
10
|
|
|
27
|
|
|
173,096
|
|
|||||
Total
|
$
|
4,340,757
|
|
|
$
|
143,121
|
|
|
$
|
98,241
|
|
|
$
|
68,109
|
|
|
$
|
4,650,228
|
|
(1)
|
Accruing classified loans include loans that are classified as substandard but are still accruing interest income.
|
|
As of December 31, 2010
|
||||||||||||||||||
|
By Loan Grade or Nonaccrual Status
|
|
|
||||||||||||||||
|
Pass
|
|
Special Mention
|
|
Accruing Classified (1)
|
|
Nonaccrual Loans (2)
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Commercial and industrial
|
$
|
601,364
|
|
|
$
|
29,698
|
|
|
$
|
18,502
|
|
|
$
|
8,583
|
|
|
$
|
658,147
|
|
Commercial real estate
|
1,420,682
|
|
|
135,605
|
|
|
75,281
|
|
|
66,518
|
|
|
1,698,086
|
|
|||||
Construction and land
|
115,056
|
|
|
18,083
|
|
|
2,240
|
|
|
15,323
|
|
|
150,702
|
|
|||||
Residential
|
1,658,656
|
|
|
196
|
|
|
971
|
|
|
14,111
|
|
|
1,673,934
|
|
|||||
Home equity
|
156,605
|
|
|
702
|
|
|
324
|
|
|
799
|
|
|
158,430
|
|
|||||
Consumer and other
|
137,466
|
|
|
3,331
|
|
|
120
|
|
|
131
|
|
|
141,048
|
|
|||||
Total
|
$
|
4,089,829
|
|
|
$
|
187,615
|
|
|
$
|
97,438
|
|
|
$
|
105,465
|
|
|
$
|
4,480,347
|
|
(1)
|
Accruing classified loans include loans that are classified as substandard but are still accruing interest income.
|
(2)
|
Does not include a nonaccrual construction and land loan held for sale of $1.5 million as of December 31, 2010. This loan was the one remaining loan in the Company's non-strategic Southern California loans held for sale portfolio.
|
|
As of and for the year ended December 31, 2011
|
||||||||||||||||||
|
Recorded Investment (1)
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
|
YTD Average Recorded Investment
|
|
YTD Interest Income Recognized while Impaired
|
||||||||||
|
(In thousands)
|
|
|
|
|
||||||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
$
|
5,595
|
|
|
$
|
6,239
|
|
|
n/a
|
|
$
|
6,437
|
|
|
$
|
59
|
|
||
Commercial real estate
|
34,963
|
|
|
49,690
|
|
|
n/a
|
|
49,765
|
|
|
373
|
|
||||||
Construction and land
|
6,493
|
|
|
10,783
|
|
|
n/a
|
|
6,473
|
|
|
—
|
|
||||||
Residential
|
10,451
|
|
|
11,222
|
|
|
n/a
|
|
8,810
|
|
|
198
|
|
||||||
Home equity
|
326
|
|
|
360
|
|
|
n/a
|
|
745
|
|
|
—
|
|
||||||
Consumer and other
|
—
|
|
|
—
|
|
|
n/a
|
|
11
|
|
|
—
|
|
||||||
Subtotal
|
$
|
57,828
|
|
|
$
|
78,294
|
|
|
n/a
|
|
$
|
72,241
|
|
|
$
|
630
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
$
|
1,123
|
|
|
$
|
1,137
|
|
|
$
|
149
|
|
|
$
|
748
|
|
|
$
|
—
|
|
Commercial real estate
|
23,202
|
|
|
24,398
|
|
|
3,307
|
|
|
26,274
|
|
|
440
|
|
|||||
Construction and land
|
1,279
|
|
|
1,302
|
|
|
219
|
|
|
2,591
|
|
|
—
|
|
|||||
Residential
|
6,230
|
|
|
6,230
|
|
|
402
|
|
|
4,279
|
|
|
137
|
|
|||||
Home equity
|
131
|
|
|
131
|
|
|
131
|
|
|
131
|
|
|
6
|
|
|||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Subtotal
|
$
|
31,965
|
|
|
$
|
33,198
|
|
|
$
|
4,208
|
|
|
$
|
34,023
|
|
|
$
|
583
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial
|
$
|
6,718
|
|
|
$
|
7,376
|
|
|
$
|
149
|
|
|
$
|
7,185
|
|
|
$
|
59
|
|
Commercial real estate
|
58,165
|
|
|
74,088
|
|
|
3,307
|
|
|
76,039
|
|
|
813
|
|
|||||
Construction and land
|
7,772
|
|
|
12,085
|
|
|
219
|
|
|
9,064
|
|
|
—
|
|
|||||
Residential
|
16,681
|
|
|
17,452
|
|
|
402
|
|
|
13,089
|
|
|
335
|
|
|||||
Home equity
|
457
|
|
|
491
|
|
|
131
|
|
|
876
|
|
|
6
|
|
|||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|||||
Total
|
$
|
89,793
|
|
|
$
|
111,492
|
|
|
$
|
4,208
|
|
|
$
|
106,264
|
|
|
$
|
1,213
|
|
(1)
|
Recorded investment represents the client loan balance net of historical charge-offs of $18.2 million and historical non-accrual interest paid, which is applied to principal, of $3.5 million.
|
|
As of and for the year ended December 31, 2010
|
||||||||||
|
Recorded Investment (1)
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
||||||
|
(In thousands)
|
||||||||||
With no related allowance recorded:
|
|
|
|
|
|
||||||
Commercial and industrial
|
$
|
8,529
|
|
|
$
|
9,340
|
|
|
n/a
|
||
Commercial real estate
|
52,794
|
|
|
75,203
|
|
|
n/a
|
||||
Construction and land
|
11,291
|
|
|
14,808
|
|
|
n/a
|
||||
Residential
|
6,619
|
|
|
6,898
|
|
|
n/a
|
||||
Home equity
|
799
|
|
|
831
|
|
|
n/a
|
||||
Consumer and other
|
—
|
|
|
—
|
|
|
n/a
|
||||
Subtotal
|
$
|
80,032
|
|
|
$
|
107,080
|
|
|
n/a
|
||
|
|
|
|
|
|
||||||
With an allowance recorded:
|
|
|
|
|
|
||||||
Commercial and industrial
|
$
|
54
|
|
|
$
|
54
|
|
|
$
|
54
|
|
Commercial real estate
|
16,736
|
|
|
18,028
|
|
|
3,174
|
|
|||
Construction and land
|
4,032
|
|
|
4,773
|
|
|
1,067
|
|
|||
Residential
|
3,823
|
|
|
3,823
|
|
|
332
|
|
|||
Home equity
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Subtotal
|
$
|
24,645
|
|
|
$
|
26,678
|
|
|
$
|
4,627
|
|
|
|
|
|
|
|
||||||
Total:
|
|
|
|
|
|
||||||
Commercial and industrial
|
$
|
8,583
|
|
|
$
|
9,394
|
|
|
$
|
54
|
|
Commercial real estate
|
69,530
|
|
|
93,231
|
|
|
3,174
|
|
|||
Construction and land
|
15,323
|
|
|
19,581
|
|
|
1,067
|
|
|||
Residential
|
10,442
|
|
|
10,721
|
|
|
332
|
|
|||
Home equity
|
799
|
|
|
831
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
104,677
|
|
|
$
|
133,758
|
|
|
$
|
4,627
|
|
(1)
|
Recorded investment represents the client loan balance net of historical charge-offs of $26.4 million and historical non-accrual interest paid, which is applied to principal, of $2.6 million.
|
|
As of and for the year ended December 31, 2011
|
||||||||||||||||
|
Restructured Current Year to Date
|
|
TDRs that defaulted in 2011
that were restructured
in a TDR in 2011
|
||||||||||||||
|
# of Loans
|
|
Pre-modification
recorded investment
|
|
Post-modification
recorded investment
|
|
# of Loans
|
|
Post-modification
recorded investment
|
||||||||
|
(In thousands, except number of loans)
|
||||||||||||||||
Commercial and industrial (1)
|
7
|
|
|
$
|
5,983
|
|
|
$
|
5,983
|
|
|
1
|
|
|
$
|
125
|
|
Commercial real estate (2)
|
10
|
|
|
33,406
|
|
|
33,758
|
|
|
2
|
|
|
2,111
|
|
|||
Construction and land (3)
|
2
|
|
|
4,452
|
|
|
3,852
|
|
|
—
|
|
|
—
|
|
|||
Residential (4)
|
11
|
|
|
2,951
|
|
|
2,951
|
|
|
—
|
|
|
—
|
|
|||
Home equity
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
30
|
|
|
$
|
46,792
|
|
|
$
|
46,544
|
|
|
3
|
|
|
$
|
2,236
|
|
(1)
|
Represents the following concessions: extension of term (1 loan; recorded investment of $3.1 million); temporary rate reduction (1 loan; recorded investment of $0.2 million); or a combination of such concessions (5 loans; recorded investment of $2.7 million).
|
(2)
|
Represents the following concessions: temporary rate reduction (4 loans; recorded investment of $13.7 million); extension of term (1 loan; recorded investment of $1.0 million); or a combination of such concessions (5 loans; recorded investment of $19.1 million).
|
(3)
|
Represents the following concessions: extension of term (2 loans; recorded investment of $3.9 million).
|
(4)
|
Represents the following concessions: extension of term (1 loan; recorded investment of $2.0 million); temporary rate reduction (10 loans; recorded investment of $1.0 million).
|
|
For the year ended
December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Balance at beginning of year
|
$
|
38,164
|
|
|
$
|
37,195
|
|
Additions
|
1,015
|
|
|
8,939
|
|
||
Repayments
|
(8
|
)
|
|
(7,497
|
)
|
||
Adjustments (1)
|
(29,687
|
)
|
|
(473
|
)
|
||
Balance at end of year
|
$
|
9,484
|
|
|
$
|
38,164
|
|
(1)
|
As explained in the preceding paragraph, the adjustment for 2011 is due to the merger of the four Banks into one combined Bank during 2011 which resulted in former directors' loans listed in the "Adjustments" row in the above totals. Adjustment for 2010 is for loans to directors who retired or resigned during the year.
|
8.
|
ALLOWANCE FOR LOAN LOSSES
|
|
At and for the year ended December 31, 2011
|
||
|
(In thousands)
|
||
Allowance for loan losses, beginning of year:
|
|
||
Commercial and industrial
|
$
|
13,438
|
|
Commercial real estate
|
65,760
|
|
|
Construction and land
|
6,875
|
|
|
Residential mortgage
|
7,449
|
|
|
Home equity
|
1,231
|
|
|
Consumer and other
|
1,478
|
|
|
Unallocated
|
2,172
|
|
|
Total allowance for loan losses, beginning of year
|
98,403
|
|
|
At and for the year ended December 31, 2011
|
||
|
(In thousands)
|
||
|
|
||
Provision/ (credit) for loan losses:
|
|
||
Commercial and industrial
|
(2,219
|
)
|
|
Commercial real estate
|
11,718
|
|
|
Construction and land
|
(901
|
)
|
|
Residential mortgage
|
3,244
|
|
|
Home equity
|
1,183
|
|
|
Consumer and other
|
333
|
|
|
Unallocated
|
(198
|
)
|
|
Total provision for loan losses
|
13,160
|
|
|
Loans charged-off:
|
|
||
Commercial and industrial
|
(3,257
|
)
|
|
Commercial real estate
|
(16,521
|
)
|
|
Construction and land
|
(4,530
|
)
|
|
Residential mortgage
|
(1,507
|
)
|
|
Home equity
|
(891
|
)
|
|
Consumer and other
|
(718
|
)
|
|
Total charge-offs
|
(27,424
|
)
|
|
Recoveries on loans previously charged-off:
|
|
||
Commercial and industrial
|
4,201
|
|
|
Commercial real estate
|
2,668
|
|
|
Construction and land
|
4,938
|
|
|
Residential mortgage
|
100
|
|
|
Home equity
|
12
|
|
|
Consumer and other
|
56
|
|
|
Total recoveries
|
11,975
|
|
|
Allowance for loan losses at December 31, 2011 (end of year):
|
|
||
Commercial and industrial
|
12,163
|
|
|
Commercial real estate
|
63,625
|
|
|
Construction and land
|
6,382
|
|
|
Residential mortgage
|
9,286
|
|
|
Home equity
|
1,535
|
|
|
Consumer and other
|
1,149
|
|
|
Unallocated
|
1,974
|
|
|
Total allowance for loan losses at December 31, 2011 (end of year)
|
$
|
96,114
|
|
|
|
|
At and for the year ended December 31,
|
||||||
2010
|
|
2009
|
|||||
|
(In thousands)
|
||||||
Allowance for loan losses, beginning of year
|
$
|
68,444
|
|
|
$
|
64,091
|
|
Provision for loan losses
|
87,178
|
|
|
44,959
|
|
||
Charge-offs
|
(66,739
|
)
|
|
(41,934
|
)
|
||
Recoveries
|
9,520
|
|
|
1,328
|
|
||
Allowance for loan losses, end of year
|
$
|
98,403
|
|
|
$
|
68,444
|
|
|
Commercial and industrial
|
|
Commercial real estate
|
|
Construction and land
|
|
Residential mortgage
|
||||||||
|
(In thousands)
|
||||||||||||||
Allowance for loan losses balance at December 31, 2011 attributable to:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
12,014
|
|
|
$
|
60,318
|
|
|
$
|
6,163
|
|
|
$
|
8,884
|
|
Loans individually evaluated
|
149
|
|
|
3,307
|
|
|
219
|
|
|
402
|
|
||||
Total allowance for loan losses
|
$
|
12,163
|
|
|
$
|
63,625
|
|
|
$
|
6,382
|
|
|
$
|
9,286
|
|
|
|
|
|
|
|
|
|
||||||||
Recorded investment (loan balance) at December 31, 2011:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
680,384
|
|
|
$
|
1,611,055
|
|
|
$
|
145,937
|
|
|
$
|
1,806,722
|
|
Loans individually evaluated
|
6,718
|
|
|
58,165
|
|
|
7,772
|
|
|
16,681
|
|
||||
Total Loans
|
$
|
687,102
|
|
|
$
|
1,669,220
|
|
|
$
|
153,709
|
|
|
$
|
1,823,403
|
|
|
Home equity
|
|
Consumer and other
|
|
Unallocated
|
|
Total
|
||||||||
(Continued from above)
|
(In thousands)
|
||||||||||||||
Allowance for loan losses balance at December 31, 2011 attributable to:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
1,404
|
|
|
$
|
1,149
|
|
|
$
|
1,974
|
|
|
$
|
91,906
|
|
Loans individually evaluated
|
131
|
|
|
—
|
|
|
—
|
|
|
4,208
|
|
||||
Total allowance for loan losses
|
$
|
1,535
|
|
|
$
|
1,149
|
|
|
$
|
1,974
|
|
|
$
|
96,114
|
|
|
|
|
|
|
|
|
|
||||||||
Recorded investment (loan balance) at December 31, 2011:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
143,241
|
|
|
$
|
173,096
|
|
|
$
|
—
|
|
|
$
|
4,560,435
|
|
Loans individually evaluated
|
457
|
|
|
—
|
|
|
—
|
|
|
89,793
|
|
||||
Total Loans
|
$
|
143,698
|
|
|
$
|
173,096
|
|
|
$
|
—
|
|
|
$
|
4,650,228
|
|
|
Commercial and industrial
|
|
Commercial real estate
|
|
Construction and land (1)
|
|
Residential mortgage
|
||||||||
|
(In thousands)
|
||||||||||||||
Allowance for loan losses balance at December 31, 2010 attributable to:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
13,384
|
|
|
$
|
62,586
|
|
|
$
|
5,808
|
|
|
$
|
7,117
|
|
Loans individually evaluated
|
54
|
|
|
3,174
|
|
|
1,067
|
|
|
332
|
|
||||
Total allowance for loan losses
|
$
|
13,438
|
|
|
$
|
65,760
|
|
|
$
|
6,875
|
|
|
$
|
7,449
|
|
|
|
|
|
|
|
|
|
||||||||
Recorded investment (loan balance) at December 31, 2010:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
649,564
|
|
|
$
|
1,628,556
|
|
|
$
|
135,379
|
|
|
$
|
1,663,492
|
|
Loans individually evaluated
|
8,583
|
|
|
69,530
|
|
|
15,323
|
|
|
10,442
|
|
||||
Total Loans
|
$
|
658,147
|
|
|
$
|
1,698,086
|
|
|
$
|
150,702
|
|
|
$
|
1,673,934
|
|
|
Home equity
|
|
Consumer and other
|
|
Unallocated
|
|
Total
|
||||||||
(Continued from above)
|
(In thousands)
|
||||||||||||||
Allowance for loan losses balance at December 31, 2010 attributable to:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
1,231
|
|
|
$
|
1,478
|
|
|
$
|
2,172
|
|
|
$
|
93,776
|
|
Loans individually evaluated
|
—
|
|
|
—
|
|
|
—
|
|
|
4,627
|
|
||||
Total allowance for loan losses
|
$
|
1,231
|
|
|
$
|
1,478
|
|
|
$
|
2,172
|
|
|
$
|
98,403
|
|
|
|
|
|
|
|
|
|
||||||||
Recorded investment (loan balance) at December 31, 2010:
|
|
|
|
|
|
|
|
||||||||
Loans collectively evaluated
|
$
|
157,631
|
|
|
$
|
141,048
|
|
|
$
|
—
|
|
|
$
|
4,375,670
|
|
Loans individually evaluated
|
799
|
|
|
—
|
|
|
—
|
|
|
104,677
|
|
||||
Total Loans
|
$
|
158,430
|
|
|
$
|
141,048
|
|
|
$
|
—
|
|
|
$
|
4,480,347
|
|
(1)
|
Does not include a nonaccrual construction and land loan held for sale of $1.5 million at December 31, 2010. This loan was the one remaining loan in the Company's non-strategic Southern California loans held for sale portfolio.
|
9.
|
DERIVATIVES AND HEDGING ACTIVITIES
|
|
December 31, 2011
|
|
December 31, 2010
|
||||||||||||||||||||
|
Asset derivatives
|
|
Liability derivatives
|
|
Asset derivatives
|
|
Liability derivatives
|
||||||||||||||||
|
Balance
sheet
location
|
|
Fair value (2)
|
|
Balance
sheet
location
|
|
Fair value (2)
|
|
Balance
sheet
location
|
|
Fair value (2)
|
|
Balance
sheet
location
|
|
Fair value (2)
|
||||||||
|
(In thousands)
|
||||||||||||||||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate products
|
Other
assets
|
|
$
|
—
|
|
|
Other
liabilities
|
|
$
|
(5,308
|
)
|
|
Other
assets
|
|
$
|
—
|
|
|
Other
liabilities
|
|
$
|
(2,342
|
)
|
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate products (1)
|
Other
assets
|
|
4,207
|
|
|
Other
assets
|
|
(4,366
|
)
|
|
Other
assets
|
|
4,862
|
|
|
Other
assets
|
|
(5,049
|
)
|
||||
Foreign exchange contracts (1)
|
Other assets
|
|
7
|
|
|
Other assets
|
|
(7
|
)
|
|
Other assets
|
|
130
|
|
|
Other assets
|
|
(130
|
)
|
||||
Total
|
|
|
$
|
4,214
|
|
|
|
|
$
|
(9,681
|
)
|
|
|
|
$
|
4,992
|
|
|
|
|
$
|
(7,521
|
)
|
(1)
|
Interest rate products and foreign exchange contracts derivative liabilities are netted with interest rate products and foreign exchange contacts derivative assets within other assets in the consolidated balance sheets.
|
(2)
|
For additional details, see Part II. Item 8. “Financial Statements and Supplementary Data-Note 22: Fair Value.”
|
Derivatives in Cash
Flow Hedging
Relationships
|
Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion) Years Ended December 31,
|
|
Location of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
|
Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)Years Ended December 31,
|
||||||||||||
2011
|
|
2010
|
|
|
2011
|
|
2010
|
||||||||||
(In thousands)
|
|||||||||||||||||
Interest rate products
|
$
|
(4,839
|
)
|
|
$
|
(2,254
|
)
|
|
Interest Income
|
|
$
|
(1,873
|
)
|
|
$
|
2,516
|
|
|
|
|
|
|
Other income/expense
|
|
—
|
|
|
(5
|
)
|
||||||
Total
|
$
|
(4,839
|
)
|
|
$
|
(2,254
|
)
|
|
|
|
$
|
(1,873
|
)
|
|
$
|
2,511
|
|
Derivatives Not
Designated as Hedging
Instruments
|
|
Location of Gain or (Loss) Recognized in Income on Derivative
|
|
Amount of Gain or (Loss), Net, Recognized in Income on Derivative Years Ended December 31,
|
||||||
|
2011
|
|
2010
|
|||||||
|
|
|
|
(In thousands)
|
||||||
Interest rate products
|
|
Other income/expense
|
|
$
|
29
|
|
|
$
|
(59
|
)
|
Foreign exchange contracts
|
|
Other income/expense
|
|
34
|
|
|
25
|
|
||
Total
|
|
|
|
$
|
63
|
|
|
$
|
(34
|
)
|
10.
|
PREMISES AND EQUIPMENT
|
|
As of December 31,
|
||||||
2011
|
|
2010
|
|||||
|
(In thousands)
|
||||||
Leasehold improvements
|
$
|
35,081
|
|
|
$
|
30,394
|
|
Furniture, fixtures, and equipment
|
37,993
|
|
|
35,630
|
|
||
Buildings
|
4,263
|
|
|
4,276
|
|
||
Land
|
374
|
|
|
374
|
|
||
Subtotal
|
77,711
|
|
|
70,674
|
|
||
Less: accumulated depreciation and amortization
|
48,358
|
|
|
44,032
|
|
||
Premises and equipment, net
|
$
|
29,353
|
|
|
$
|
26,642
|
|
|
Minimum
lease payments
|
||
(In thousands)
|
|||
2012
|
$
|
12,937
|
|
2013
|
11,364
|
|
|
2014
|
11,115
|
|
|
2015
|
7,378
|
|
|
2016
|
6,332
|
|
|
Thereafter
|
23,537
|
|
|
Total
|
$
|
72,663
|
|
11.
|
GOODWILL AND OTHER INTANGIBLE ASSETS
|
|
Balance at
December 31,
2010
|
|
Acquisitions
|
|
Impairment
|
|
Other
adjustments
|
|
Balance at
December 31,
2011
|
||||||||||
(In thousands)
|
|||||||||||||||||||
Goodwill
|
|
|
|
|
|
|
|
|
|
||||||||||
Private Banking
|
$
|
2,403
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,403
|
|
Investment Management
|
66,981
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
66,955
|
|
|||||
Wealth Advisory
|
45,667
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
45,680
|
|
|||||
Total goodwill
|
$
|
115,051
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(13
|
)
|
|
$
|
115,038
|
|
|
Balance at
December 31,
2009
|
|
Acquisitions
|
|
Impairment
|
|
Other
adjustments
|
|
Balance at
December 31,
2010
|
||||||||||
(In thousands)
|
|||||||||||||||||||
Goodwill
|
|
|
|
|
|
|
|
|
|
||||||||||
Private Banking
|
$
|
2,403
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,403
|
|
Investment Management
|
62,664
|
|
|
4,317
|
|
|
—
|
|
|
—
|
|
|
66,981
|
|
|||||
Wealth Advisory
|
43,625
|
|
|
2,038
|
|
|
—
|
|
|
4
|
|
|
45,667
|
|
|||||
Total goodwill
|
$
|
108,692
|
|
|
$
|
6,355
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
115,051
|
|
|
Goodwill prior to impairment
|
|
Cumulative goodwill impairment
|
|
Goodwill
|
||||||
(In thousands)
|
|||||||||||
Private Banking
|
$
|
86,581
|
|
|
$
|
(84,178
|
)
|
|
$
|
2,403
|
|
Investment Management
|
117,216
|
|
|
(50,261
|
)
|
|
66,955
|
|
|||
Wealth Advisory
|
47,120
|
|
|
(1,440
|
)
|
|
45,680
|
|
|||
Total goodwill at December 31, 2011
|
$
|
250,917
|
|
|
$
|
(135,879
|
)
|
|
$
|
115,038
|
|
|
|
|
|
|
|
||||||
Private Banking
|
$
|
86,581
|
|
|
$
|
(84,178
|
)
|
|
$
|
2,403
|
|
Investment Management
|
117,242
|
|
|
(50,261
|
)
|
|
66,981
|
|
|||
Wealth Advisory
|
47,107
|
|
|
(1,440
|
)
|
|
45,667
|
|
|||
Equity method investees
|
3,456
|
|
|
(3,456
|
)
|
|
—
|
|
|||
Total goodwill at December 31, 2010
|
$
|
254,386
|
|
|
$
|
(139,335
|
)
|
|
$
|
115,051
|
|
|
2011
|
|
2010
|
||||||||||||||||||||
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|||||||||||||
(In thousands)
|
|||||||||||||||||||||||
Advisory contracts
|
$
|
53,135
|
|
|
$
|
26,213
|
|
|
$
|
26,922
|
|
|
$
|
53,721
|
|
|
$
|
21,902
|
|
|
$
|
31,819
|
|
Core deposit intangibles
|
1,043
|
|
|
1,043
|
|
|
—
|
|
|
1,043
|
|
|
745
|
|
|
298
|
|
||||||
Employment agreements
|
3,977
|
|
|
3,466
|
|
|
511
|
|
|
3,977
|
|
|
3,168
|
|
|
809
|
|
||||||
Trade names and other
|
2,890
|
|
|
—
|
|
|
2,890
|
|
|
2,890
|
|
|
—
|
|
|
2,890
|
|
||||||
Mortgage servicing rights
|
649
|
|
|
410
|
|
|
239
|
|
|
649
|
|
|
304
|
|
|
345
|
|
||||||
Total
|
$
|
61,694
|
|
|
$
|
31,132
|
|
|
$
|
30,562
|
|
|
$
|
62,280
|
|
|
$
|
26,119
|
|
|
$
|
36,161
|
|
|
Estimated intangible
amortization expense
|
||
|
(In thousands)
|
||
2012
|
$
|
4,555
|
|
2013
|
4,362
|
|
|
2014
|
4,191
|
|
|
2015
|
4,107
|
|
|
2016
|
3,473
|
|
12.
|
DEPOSITS
|
|
December 31,
|
||||||
2011
|
|
2010
|
|||||
(In thousands)
|
|||||||
Demand deposits (non-interest bearing)
|
$
|
1,117,350
|
|
|
$
|
972,927
|
|
NOW
|
467,535
|
|
|
415,528
|
|
||
Savings
|
58,074
|
|
|
172,588
|
|
||
Money market
|
1,966,073
|
|
|
1,829,881
|
|
||
Certificates of deposit under $100,000 (1)
|
227,000
|
|
|
275,345
|
|
||
Certificates of deposit $100,000 or greater
|
694,379
|
|
|
820,457
|
|
||
Total
|
$
|
4,530,411
|
|
|
$
|
4,486,726
|
|
|
December 31,
|
||||||
2011
|
|
2010
|
|||||
(In thousands)
|
|||||||
Less than 3 months remaining
|
$
|
377,725
|
|
|
$
|
437,711
|
|
3 to 6 months remaining
|
219,222
|
|
|
248,042
|
|
||
6 to 12 months remaining
|
209,719
|
|
|
252,430
|
|
||
1 to 3 years remaining
|
65,760
|
|
|
121,277
|
|
||
3 to 5 years remaining
|
32,681
|
|
|
16,038
|
|
||
More than 5 years remaining
|
16,272
|
|
|
20,304
|
|
||
Total
|
$
|
921,379
|
|
|
$
|
1,095,802
|
|
13.
|
FEDERAL HOME LOAN BANK BORROWINGS
|
|
December 31, 2011
|
|
December 31, 2010
|
||||||||||
Amount
|
|
Weighted
Average
Rate
|
|
Amount
|
|
Weighted
Average
Rate
|
|||||||
(In thousands)
|
|||||||||||||
Within 1 year
|
$
|
125,977
|
|
|
2.65
|
%
|
|
$
|
120,076
|
|
|
3.67
|
%
|
Over 1 to 2 years
|
70,199
|
|
|
3.97
|
%
|
|
126,448
|
|
|
2.66
|
%
|
||
Over 2 to 3 years
|
51,320
|
|
|
3.28
|
%
|
|
121,807
|
|
|
2.74
|
%
|
||
Over 3 to 5 years
|
187,252
|
|
|
2.73
|
%
|
|
132,982
|
|
|
3.21
|
%
|
||
Over 5 years
|
87,079
|
|
|
3.33
|
%
|
|
74,369
|
|
|
4.03
|
%
|
||
Total
|
$
|
521,827
|
|
|
3.03
|
%
|
|
$
|
575,682
|
|
|
3.19
|
%
|
14.
|
FEDERAL FUNDS PURCHASED AND SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE
|
|
Federal Funds
Purchased
|
|
Securities Sold
Under
Agreement to
Repurchase
|
||||
|
(In thousands)
|
||||||
2011
|
|
|
|
||||
Outstanding at end of year
|
$
|
—
|
|
|
$
|
130,791
|
|
Maximum outstanding at any month-end
|
—
|
|
|
134,257
|
|
||
Average balance for the year
|
9
|
|
|
135,134
|
|
||
Weighted average rate at end of year
|
—
|
%
|
|
1.30
|
%
|
||
Weighted average rate paid for the year
|
0.68
|
%
|
|
1.45
|
%
|
||
2010
|
|
|
|
||||
Outstanding at end of year
|
$
|
—
|
|
|
$
|
258,598
|
|
Maximum outstanding at any month-end
|
30,000
|
|
|
258,598
|
|
||
Average balance for the year
|
192
|
|
|
121,170
|
|
||
Weighted average rate at end of year
|
—
|
%
|
|
1.03
|
%
|
||
Weighted average rate paid for the year
|
0.31
|
%
|
|
1.89
|
%
|
||
2009
|
|
|
|
||||
Outstanding at end of year
|
$
|
—
|
|
|
$
|
243,377
|
|
Maximum outstanding at any month-end
|
65,000
|
|
|
243,377
|
|
||
Average balance for the year
|
9,455
|
|
|
182,592
|
|
||
Weighted average rate at end of year
|
—
|
%
|
|
1.78
|
%
|
||
Weighted average rate paid for the year
|
0.26
|
%
|
|
1.80
|
%
|
15.
|
JUNIOR SUBORDINATED DEBENTURES
|
|
December 31,
|
||||||
2011
|
|
2010
|
|||||
(In thousands)
|
|||||||
Boston Private Capital Trust II junior subordinated debentures
|
$
|
103,093
|
|
|
$
|
103,093
|
|
Boston Private Capital Trust I junior subordinated debentures
|
52,155
|
|
|
63,747
|
|
||
Gibraltar junior subordinated debentures
|
16,495
|
|
|
16,495
|
|
||
FPB junior subordinated debentures
|
6,186
|
|
|
6,186
|
|
||
Charter junior subordinated debentures
|
4,124
|
|
|
4,124
|
|
||
Total
|
$
|
182,053
|
|
|
$
|
193,645
|
|
•
|
for so long as Trust II's preferred securities remain outstanding, the Company shall maintain 100% ownership of the Trust II's common securities;
|
•
|
the Company will use its commercially reasonable efforts to ensure Trust II remains a statutory trust, except in connection with a distribution of debt securities to the holders of the Trust II securities in liquidation of Trust II, the redemption of all Trust II's securities or mergers, consolidations or incorporation, each as permitted by Trust II's declaration of trust;
|
•
|
to continue to be classified as a grantor trust for U.S. federal income tax purposes; and
|
•
|
the Company will ensure each holder of Trust II's preferred securities is treated as owning an undivided beneficial interest in the junior subordinated debentures.
|
•
|
to cause Trust I to remain a statutory business Trust and not try to voluntarily dissolve, wind-up, liquidate, or terminate except as permitted by the Trust agreement;
|
•
|
to maintain directly or indirectly ownership of all of the common securities of Trust I;
|
•
|
to use its commercially reasonable efforts to ensure that Trust I will not be an “investment company” under the Investment Company Act of 1940, as amended from time to time, or any successor legislation; and
|
•
|
to take no action that would be reasonably likely to cause Trust I to be classified as an association or a partnership taxable as a corporation for U.S. federal income tax purposes.
|
16.
|
NONCONTROLLING INTERESTS
|
|
December 31,
|
||||||
|
2011
|
|
2010
|
||||
(In thousands)
|
|||||||
Anchor
|
$
|
12,089
|
|
|
$
|
10,723
|
|
BOS
|
5,873
|
|
|
5,613
|
|
||
DTC
|
1,924
|
|
|
1,866
|
|
||
DGHM
|
1,805
|
|
|
1,396
|
|
||
|
$
|
21,691
|
|
|
$
|
19,598
|
|
|
2011
|
|
2010
|
|
2009
|
||||||
(In thousands)
|
|||||||||||
Balance at beginning of year
|
$
|
19,598
|
|
|
$
|
51,850
|
|
|
$
|
50,167
|
|
Net income attributable to noncontrolling interests
|
3,216
|
|
|
2,614
|
|
|
3,649
|
|
|||
Distributions
|
(2,149
|
)
|
|
(2,194
|
)
|
|
(2,663
|
)
|
|||
KLS acquisition
|
—
|
|
|
(29,691
|
)
|
|
—
|
|
|||
Adjustment to fair value
|
1,026
|
|
|
(2,981
|
)
|
|
697
|
|
|||
Balance at end of year
|
$
|
21,691
|
|
|
$
|
19,598
|
|
|
$
|
51,850
|
|
17.
|
EQUITY
|
Name of warrants
|
|
Number of shares of BPFH common stock issuable upon exercise of warrants
|
|
Exercise price of warrants
|
|
Date issued
|
|
Expiration date
|
|
Carlyle Warrants (1)
|
|
5,383,891
|
|
|
$6.62
|
|
July 22, 2008
|
|
July 22, 2013
|
Carlyle Director's Warrants (1)
|
|
59,174
|
|
|
$8.90
|
|
July 22, 2008
|
|
July 22, 2013
|
TARP Warrants (2)
|
|
2,887,500
|
|
|
$8.00
|
|
November 21, 2008
|
|
November 21, 2018
|
(1)
|
See Part II. Item 8. "Financial Statements and Supplementary Data—Note 27: Subsequent Events" for a discussion of the 2012 repurchase of the Carlyle Warrants and the Carlyle Director's Warrants.
|
(2)
|
The TARP Warrants, while initially issued to the Treasury, were purchased from the Treasury by unrelated third parties at a market rate.
|
18.
|
INCOME TAXES
|
|
Year Ended December 31,
|
||||||||||
2011
|
|
2010
|
|
2009
|
|||||||
|
(In thousands)
|
||||||||||
Current expense/(benefit):
|
|
|
|
|
|
||||||
Federal
|
$
|
3,827
|
|
|
$
|
7,645
|
|
|
$
|
4,757
|
|
State
|
2,742
|
|
|
(1,115
|
)
|
|
3,105
|
|
|||
Total current expense/(benefit)
|
6,569
|
|
|
6,530
|
|
|
7,862
|
|
|||
Deferred expense/(benefit):
|
|
|
|
|
|
||||||
Federal
|
6,799
|
|
|
(22,252
|
)
|
|
(4,968
|
)
|
|||
State
|
999
|
|
|
(3,729
|
)
|
|
(1,262
|
)
|
|||
Total deferred expense/(benefit)
|
7,798
|
|
|
(25,981
|
)
|
|
(6,230
|
)
|
|||
Income tax expense/(benefit)
|
$
|
14,367
|
|
|
$
|
(19,451
|
)
|
|
$
|
1,632
|
|
|
Year Ended December 31,
|
|||||||
2011
|
|
2010
|
|
2009
|
||||
Statutory Federal income tax rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Increase/ (decrease) resulting from:
|
|
|
|
|
|
|||
Tax exempt interest, net
|
(6.9
|
)%
|
|
11.4
|
%
|
|
(18.6
|
)%
|
Non deductible compensation
|
0.4
|
%
|
|
(1.6
|
)%
|
|
6.9
|
%
|
State and local income tax, net of Federal tax benefit
|
4.8
|
%
|
|
9.9
|
%
|
|
6.7
|
%
|
Tax credits
|
(2.2
|
)%
|
|
2.0
|
%
|
|
(7.3
|
)%
|
Noncontrolling interests
|
(2.2
|
)%
|
|
2.9
|
%
|
|
(7.1
|
)%
|
Prior year provision to return differences
|
0.1
|
%
|
|
0.7
|
%
|
|
(5.9
|
)%
|
Other, net
|
(0.6
|
)%
|
|
1.4
|
%
|
|
(0.6
|
)%
|
Effective income tax rate
|
28.4
|
%
|
|
61.7
|
%
|
|
9.1
|
%
|
|
December 31,
|
||||||
|
2011
|
|
2010
|
||||
(In thousands)
|
|||||||
Gross deferred tax assets:
|
|
|
|
||||
Allowance for loan losses
|
$
|
37,837
|
|
|
$
|
41,808
|
|
Allowance for losses on OREO
|
978
|
|
|
2,312
|
|
||
Stock compensation
|
12,948
|
|
|
11,878
|
|
||
Goodwill and acquired intangible assets
|
4,390
|
|
|
9,815
|
|
||
Deferred and accrued compensation
|
10,762
|
|
|
10,068
|
|
||
Federal loss carryforward
|
—
|
|
|
5,561
|
|
||
State loss carryforward, net of federal
|
2,190
|
|
|
2,181
|
|
||
Capital loss carryforward
|
4,010
|
|
|
3,081
|
|
||
Tax credit carryforward
|
4,963
|
|
|
3,013
|
|
||
Mark to market on securities available for sale
|
1,215
|
|
|
2,585
|
|
||
Other
|
2,558
|
|
|
4,662
|
|
||
Gross deferred tax assets
|
81,851
|
|
|
96,964
|
|
||
Less: valuation allowance
|
3,833
|
|
|
4,439
|
|
||
Total deferred tax assets
|
78,018
|
|
|
92,525
|
|
||
Gross deferred tax liabilities:
|
|
|
|
||||
Unrealized gain on investments
|
2,111
|
|
|
2,802
|
|
||
Cancellation of debt income deferral
|
7,131
|
|
|
7,217
|
|
||
Other
|
2,007
|
|
|
1,788
|
|
||
Total gross deferred tax liabilities
|
11,249
|
|
|
11,807
|
|
||
Net deferred tax asset
|
$
|
66,769
|
|
|
$
|
80,718
|
|
•
|
The Company had cumulative pre-tax income, as adjusted for permanent book-to-tax differences, in the period 2009 through 2011.
|
•
|
Certain tax planning strategies are available to the Company, such as reducing investments in tax-exempt securities.
|
•
|
The Company has not had any operating loss or tax credit carryovers expiring unused in recent years.
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
(In thousands)
|
||||||||||
Balance at January 1
|
$
|
477
|
|
|
$
|
350
|
|
|
$
|
350
|
|
Additions based on tax positions related to the current year
|
98
|
|
|
127
|
|
|
97
|
|
|||
Additions based on tax positions taken in prior years
|
44
|
|
|
—
|
|
|
—
|
|
|||
Decreases based on tax positions taken in prior years
|
(60
|
)
|
|
—
|
|
|
—
|
|
|||
Decreases based on settlements with taxing authorities
|
—
|
|
|
—
|
|
|
—
|
|
|||
Decreases based on the expiration of statute of limitations
|
(33
|
)
|
|
—
|
|
|
(97
|
)
|
|||
Balance at December 31
|
$
|
526
|
|
|
$
|
477
|
|
|
$
|
350
|
|
19.
|
EMPLOYEE BENEFITS
|
|
Year Ended December 31,
|
||||||||||
2011
|
|
2010
|
|
2009
|
|||||||
|
(In thousands)
|
||||||||||
Stock option and ESPP expense
|
$
|
1,730
|
|
|
$
|
2,001
|
|
|
$
|
2,807
|
|
Nonvested share expense
|
5,137
|
|
|
3,840
|
|
|
2,315
|
|
|||
Subtotal
|
6,867
|
|
|
5,841
|
|
|
5,122
|
|
|||
Tax benefit
|
2,657
|
|
|
2,218
|
|
|
1,800
|
|
|||
Stock-based compensation expense, net of tax benefit
|
$
|
4,210
|
|
|
$
|
3,623
|
|
|
$
|
3,322
|
|
|
Year Ended December 31,
|
|||||||
2011
|
|
2010
|
|
2009
|
||||
Expected volatility
|
63.5
|
%
|
|
61.6
|
%
|
|
55.2
|
%
|
Expected dividend yield
|
0.6
|
%
|
|
0.5
|
%
|
|
0.8
|
%
|
Expected term (in years)
|
6.3
|
|
|
6.2
|
|
|
6.4
|
|
Risk-free rate
|
2.3
|
%
|
|
2.4
|
%
|
|
3.2
|
%
|
|
Shares
|
|
Weighted-
Average
Exercise
Price
|
|
Weighted-
Average
Remaining
Contractual
Term in Years
|
|
Aggregate
Intrinsic Value
(in 000’s)
|
||||||
Outstanding at January 1, 2011
|
4,260,011
|
|
|
$
|
19.32
|
|
|
|
|
|
|||
Granted
|
375,281
|
|
|
$
|
6.50
|
|
|
|
|
|
|||
Exercised
|
40,395
|
|
|
$
|
5.08
|
|
|
|
|
|
|||
Forfeited
|
333,726
|
|
|
$
|
16.50
|
|
|
|
|
|
|||
Expired
|
223,297
|
|
|
$
|
19.02
|
|
|
|
|
|
|||
Outstanding at December 31, 2011
|
4,037,874
|
|
|
$
|
18.52
|
|
|
4.58
|
|
|
$
|
1,203.0
|
|
Exercisable at December 31, 2011
|
3,411,428
|
|
|
$
|
20.70
|
|
|
3.79
|
|
|
$
|
407.0
|
|
|
Shares
|
|
Weighted-
Average
Grant-Date
Fair Value
|
|||
Nonvested at January 1, 2011
|
1,944,285
|
|
|
$
|
7.39
|
|
Granted
|
978,840
|
|
|
$
|
6.44
|
|
Vested
|
189,863
|
|
|
$
|
13.39
|
|
Forfeited
|
150,185
|
|
|
$
|
7.37
|
|
Nonvested at December 31, 2011
|
2,583,077
|
|
|
$
|
6.59
|
|
20.
|
OTHER OPERATING EXPENSE
|
|
Year Ended December 31,
|
||||||||||
2011
|
|
2010
|
|
2009
|
|||||||
|
|
|
(In thousands)
|
|
|
||||||
Insurance
|
$
|
3,521
|
|
|
$
|
3,128
|
|
|
$
|
3,025
|
|
Employee travel and meals
|
2,392
|
|
|
2,157
|
|
|
1,932
|
|
|||
Forms and supplies
|
1,589
|
|
|
1,439
|
|
|
1,415
|
|
|||
Other banking expenses
|
1,352
|
|
|
1,507
|
|
|
1,939
|
|
|||
Telephone
|
1,266
|
|
|
1,155
|
|
|
1,145
|
|
|||
OREO and repossessed asset expenses
|
963
|
|
|
1,825
|
|
|
2,048
|
|
|||
Publications and dues
|
863
|
|
|
949
|
|
|
818
|
|
|||
Postage
|
711
|
|
|
699
|
|
|
666
|
|
|||
Courier and express mail
|
634
|
|
|
706
|
|
|
805
|
|
|||
Training and education
|
514
|
|
|
655
|
|
|
658
|
|
|||
Correspondent bank charges
|
473
|
|
|
488
|
|
|
979
|
|
|||
Legal settlement costs
|
—
|
|
|
2,450
|
|
|
—
|
|
|||
Provision/ (credit) for off-balance sheet loan commitments
|
(1,528
|
)
|
|
181
|
|
|
(412
|
)
|
|||
Other
|
1,639
|
|
|
2,423
|
|
|
2,107
|
|
|||
Total
|
$
|
14,389
|
|
|
$
|
19,762
|
|
|
$
|
17,125
|
|
21.
|
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
|
|
December 31,
|
||||||
|
2011
|
|
2010
|
||||
|
(In thousands)
|
||||||
Commitments to originate loans
|
|
|
|
||||
Variable rate
|
$
|
108,868
|
|
|
$
|
66,864
|
|
Fixed rate
|
78,013
|
|
|
62,388
|
|
||
Total commitments to originate new loans
|
$
|
186,881
|
|
|
$
|
129,252
|
|
Unadvanced portion of loans and unused lines of credit
|
$
|
898,772
|
|
|
$
|
847,319
|
|
Standby letters of credit
|
$
|
18,426
|
|
|
$
|
23,794
|
|
Forward commitments to sell loans
|
$
|
44,868
|
|
|
$
|
23,998
|
|
22.
|
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
|
|
|
Fair value measurements at reporting date using:
|
||||||||||||
At
December 31,
2011
|
|
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|||||||||
(In thousands)
|
|||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Available for sale securities
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
4,903
|
|
|
$
|
1,303
|
|
|
$
|
3,600
|
|
|
$
|
—
|
|
Government-sponsored entities
|
382,208
|
|
|
—
|
|
|
382,208
|
|
|
—
|
|
||||
Corporate bonds
|
4,912
|
|
|
—
|
|
|
4,912
|
|
|
—
|
|
||||
Municipal bonds
|
200,675
|
|
|
—
|
|
|
200,675
|
|
|
—
|
|
||||
Mortgage-backed securities
|
254,344
|
|
|
—
|
|
|
254,344
|
|
|
—
|
|
||||
Other
|
540
|
|
|
540
|
|
|
—
|
|
|
—
|
|
||||
Total available for sale securities
|
847,582
|
|
|
1,843
|
|
|
845,739
|
|
|
—
|
|
||||
Derivatives—interest rate customer swaps
|
4,207
|
|
|
—
|
|
|
4,207
|
|
|
—
|
|
||||
Derivatives—customer foreign exchange forward
|
7
|
|
|
—
|
|
|
7
|
|
|
—
|
|
||||
Other investments
|
5,317
|
|
|
4,493
|
|
|
824
|
|
|
—
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivative-interest rate customer swaps (1)
|
$
|
4,366
|
|
|
$
|
—
|
|
|
$
|
4,366
|
|
|
$
|
—
|
|
Derivatives—customer foreign exchange forward (1)
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
Derivatives-junior subordinated debenture interest rate swap (1)
|
$
|
5,308
|
|
|
$
|
—
|
|
|
$
|
5,308
|
|
|
$
|
—
|
|
(1)
|
Derivatives-interest rate customer swaps and customer foreign exchange forward (liabilities) are netted with the derivative assets within other assets in the consolidated balance sheets.
|
|
At
December 31,
2010
|
|
Fair value measurements at reporting date using:
|
||||||||||||
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|||||||||||
(In thousands)
|
|||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Available for sale securities:
|
|
|
|
|
|
|
|
||||||||
U.S. government and agencies
|
$
|
81,402
|
|
|
$
|
72,972
|
|
|
$
|
8,430
|
|
|
$
|
—
|
|
Government-sponsored entities
|
263,599
|
|
|
—
|
|
|
263,599
|
|
|
—
|
|
||||
Corporate bonds
|
18,816
|
|
|
—
|
|
|
18,816
|
|
|
—
|
|
||||
Municipal bonds
|
194,048
|
|
|
—
|
|
|
194,048
|
|
|
—
|
|
||||
Mortgage-backed securities
|
234,257
|
|
|
—
|
|
|
234,257
|
|
|
—
|
|
||||
Other
|
3,316
|
|
|
539
|
|
|
2,027
|
|
|
750
|
|
||||
Total available for sale securities
|
795,438
|
|
|
73,511
|
|
|
721,177
|
|
|
750
|
|
||||
Derivatives—interest rate customer swaps
|
4,862
|
|
|
—
|
|
|
4,862
|
|
|
—
|
|
||||
Derivatives—customer foreign exchange forward
|
130
|
|
|
—
|
|
|
130
|
|
|
—
|
|
||||
Other investments
|
10,828
|
|
|
4,723
|
|
|
6,105
|
|
|
—
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives—interest rate customer swaps (1)
|
$
|
5,049
|
|
|
$
|
—
|
|
|
$
|
5,049
|
|
|
$
|
—
|
|
Derivatives—customer foreign exchange forward (1)
|
130
|
|
|
—
|
|
|
130
|
|
|
—
|
|
||||
Derivatives-junior subordinated debenture interest rate swap (1)
|
2,342
|
|
|
—
|
|
|
2,342
|
|
|
—
|
|
(1)
|
Derivatives-interest rate customer swaps and customer foreign exchange forward (liabilities) are netted with the derivative assets within other assets in the consolidated balance sheets.
|
|
Balance at
January 1,
2011
|
|
Purchase, (sales),
issuances and
(settlements), net
|
|
Transfers
into (out of)
Level 3
|
|
Unrealized
gains
(losses)
|
|
Amortization
|
|
Balance at
December 31,
2011
|
|||||||||
(In thousands)
|
||||||||||||||||||||
Other available for sale investments (1)
|
$
|
750
|
|
|
—
|
|
|
$
|
(750
|
)
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Total Level 3 assets
|
$
|
750
|
|
|
—
|
|
|
$
|
(750
|
)
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
(1)
|
Three CRA loan funds were reclassified to other assets on the consolidated balance sheet as of December 31, 2011 as they were determined to be non-financial assets.
|
|
Balance at
January 1,
2010
|
|
Purchase, (sales),
issuances and
(settlements), net
|
|
Transfers
into (out of)
Level 3
|
|
Unrealized
gains
(losses)
|
|
Amortization
|
|
Balance at
December 31,
2010
|
||||||||||||
(In thousands)
|
|||||||||||||||||||||||
Mortgage-backed securities (1)
|
$
|
3,151
|
|
|
$
|
—
|
|
|
$
|
(3,151
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other available for sale investments
|
500
|
|
|
250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
750
|
|
||||||
Total Level 3 assets
|
$
|
3,651
|
|
|
$
|
250
|
|
|
$
|
(3,151
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
750
|
|
(1)
|
One mortgage-backed security was originally categorized as a Level 3 measurement because its value was being determined by a third party pricing matrix. During the first quarter of 2010, the Company was able to obtain pricing information and market data from similar assets, and therefore the security was changed to a Level 2 measurement.
|
|
December 31, 2011
|
|
Fair value measurements recorded during the year:
|
||||||||||||
Quoted prices in
active markets
for identical
assets (Level 1)
|
|
Significant other
observable
inputs (Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
|||||||||||
(In thousands)
|
|||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Impaired loans(1)
|
$
|
22,124
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,124
|
|
OREO(2)
|
813
|
|
|
—
|
|
|
—
|
|
|
813
|
|
||||
|
$
|
22,937
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,937
|
|
(1)
|
Collateral-dependent impaired loans held at December 31, 2011 that had write-downs in fair value or whose specific reserve changed during 2011.
|
(2)
|
Two OREO properties held at December 31, 2011 had write-downs during 2011.
|
(1)
|
Collateral-dependent impaired loans held at December 31, 2010 that had write-downs in fair value or whose specific reserve changed during 2010.
|
(2)
|
One loan in the loans held for sale category had a write-down during 2010.
|
(3)
|
Three OREO properties held at December 31, 2010 had valuation allowances during 2010.
|
|
December 31, 2011
|
|
December 31, 2010
|
||||||||||||
Book Value
|
|
Fair Value
|
|
Book Value
|
|
Fair Value
|
|||||||||
(In thousands)
|
|||||||||||||||
FINANCIAL ASSETS:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
203,901
|
|
|
$
|
203,901
|
|
|
$
|
494,439
|
|
|
$
|
494,439
|
|
Held to maturity securities
|
—
|
|
|
—
|
|
|
2,515
|
|
|
2,497
|
|
||||
Loans, net (including loans held for sale)
|
4,566,183
|
|
|
4,630,890
|
|
|
4,391,089
|
|
|
4,458,519
|
|
||||
Other financial assets
|
120,097
|
|
|
120,097
|
|
|
121,977
|
|
|
121,977
|
|
||||
FINANCIAL LIABILITIES:
|
|
|
|
|
|
|
|
||||||||
Deposits
|
4,530,411
|
|
|
4,538,137
|
|
|
4,486,726
|
|
|
4,494,884
|
|
||||
Securities sold under agreements to repurchase
|
130,791
|
|
|
133,660
|
|
|
258,598
|
|
|
262,344
|
|
||||
Federal Home Loan Bank borrowings
|
521,827
|
|
|
547,584
|
|
|
575,682
|
|
|
597,023
|
|
||||
Junior subordinated debentures
|
182,053
|
|
|
165,242
|
|
|
193,645
|
|
|
168,235
|
|
||||
Other financial liabilities
|
11,388
|
|
|
11,388
|
|
|
13,133
|
|
|
13,133
|
|
23.
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC. (PARENT COMPANY ONLY)
|
|
December 31, 2011
|
|
December 31, 2010
|
||||
(In thousands)
|
|||||||
Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
96,871
|
|
|
$
|
88,463
|
|
Investment in wholly-owned and majority-owned subsidiaries:
|
|
|
|
||||
Bank(s)
|
504,861
|
|
|
468,840
|
|
||
Non-banks
|
145,299
|
|
|
156,082
|
|
||
Investment in partnerships and trusts
|
7,143
|
|
|
8,850
|
|
||
Intangible assets, net
|
—
|
|
|
586
|
|
||
Income tax receivable and deferred
|
25,798
|
|
|
21,519
|
|
||
Other assets
|
14,002
|
|
|
21,205
|
|
||
Total assets
|
$
|
793,974
|
|
|
$
|
765,545
|
|
Liabilities:
|
|
|
|
||||
Deferred acquisition obligations
|
$
|
—
|
|
|
$
|
4,521
|
|
Junior subordinated debentures
|
182,053
|
|
|
193,645
|
|
||
Other liabilities
|
24,656
|
|
|
29,836
|
|
||
Total liabilities
|
206,709
|
|
|
228,002
|
|
||
Redeemable Noncontrolling Interests(1)
|
21,140
|
|
|
18,665
|
|
||
Total Shareholders’ Equity
|
566,125
|
|
|
518,878
|
|
||
Total liabilities, redeemable noncontrolling interests and shareholders’ equity
|
$
|
793,974
|
|
|
$
|
765,545
|
|
(1)
|
Represents the maximum redemption value of noncontrolling interests.
|
|
Year ended December 31,
|
||||||||||
|
2011
|
|
2010
|
|
2009
|
||||||
|
(In thousands)
|
||||||||||
Income:
|
|
|
|
|
|
||||||
Interest income
|
$
|
323
|
|
|
$
|
610
|
|
|
$
|
1,887
|
|
Gain on repurchase of debt
|
4,230
|
|
|
—
|
|
|
18,739
|
|
|||
Dividends from subsidiaries:
|
|
|
|
|
|
||||||
Bank(s)
|
7,400
|
|
|
9,200
|
|
|
10,000
|
|
|||
Non-banks
|
23,247
|
|
|
15,606
|
|
|
17,511
|
|
|||
Other income/ (loss)
|
1,147
|
|
|
910
|
|
|
1,187
|
|
|||
Total income
|
36,347
|
|
|
26,326
|
|
|
49,324
|
|
|||
Operating Expense:
|
|
|
|
|
|
||||||
Salaries and employee benefits
|
15,286
|
|
|
16,355
|
|
|
13,283
|
|
|||
Professional fees
|
4,184
|
|
|
6,363
|
|
|
6,192
|
|
|||
Interest expense
|
7,474
|
|
|
10,125
|
|
|
12,421
|
|
|||
Restructuring Expense (1)
|
2,609
|
|
|
—
|
|
|
—
|
|
|||
Other expenses
|
3,664
|
|
|
4,594
|
|
|
4,725
|
|
|||
Total operating expense
|
33,217
|
|
|
37,437
|
|
|
36,621
|
|
|||
Income/(loss) before income taxes
|
3,130
|
|
|
(11,111
|
)
|
|
12,703
|
|
|||
Income tax expense/ (benefit)
|
(11,659
|
)
|
|
(14,897
|
)
|
|
(8,924
|
)
|
|||
Net income/ (loss) from discontinued operations
|
6,099
|
|
|
3,729
|
|
|
(7,505
|
)
|
|||
Income/(loss) before equity in undistributed loss of subsidiaries
|
20,888
|
|
|
7,515
|
|
|
14,122
|
|
|||
Equity in undistributed earnings/ (loss) of subsidiaries
|
18,249
|
|
|
(18,485
|
)
|
|
(8,891
|
)
|
|||
Net income/(loss) attributable to the Company
|
$
|
39,137
|
|
|
$
|
(10,970
|
)
|
|
$
|
5,231
|
|
|
Year ended December 31,
|
||||||||||
|
2011
|
|
2010
|
|
2009
|
||||||
(In thousands)
|
|||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income/(loss) attributable to the Company
|
$
|
39,137
|
|
|
$
|
(10,970
|
)
|
|
$
|
5,231
|
|
Net income/(loss) from discontinued operations
|
6,099
|
|
|
3,729
|
|
|
(7,505
|
)
|
|||
Net income/(loss) from continuing operations
|
33,038
|
|
|
(14,699
|
)
|
|
12,736
|
|
|||
Adjustments to reconcile net income/(loss) from continuing operations to net cash provided by/(used in) operating activities:
|
|
|
|
|
|
||||||
Equity in loss/(earnings) of subsidiaries:
|
|
|
|
|
|
||||||
Bank(s)
|
(40,119
|
)
|
|
767
|
|
|
(13,905
|
)
|
|||
Non-banks
|
(8,777
|
)
|
|
(7,088
|
)
|
|
(4,715
|
)
|
|
Year ended December 31,
|
||||||||||
|
2011
|
|
2010
|
|
2009
|
||||||
(In thousands)
|
|||||||||||
Dividends from subsidiaries:
|
|
|
|
|
|
||||||
Bank(s)
|
7,400
|
|
|
9,200
|
|
|
10,000
|
|
|||
Non-banks
|
23,247
|
|
|
15,606
|
|
|
17,511
|
|
|||
Gain on the repurchase of debt
|
(4,230
|
)
|
|
—
|
|
|
(18,739
|
)
|
|||
Decrease/ (increase) in income taxes receivable and deferred
|
(4,279
|
)
|
|
4,246
|
|
|
14,230
|
|
|||
Depreciation and amortization
|
3,288
|
|
|
1,378
|
|
|
3,257
|
|
|||
Net decrease/ (increase) in other operating activities
|
(1,557
|
)
|
|
(23,067
|
)
|
|
13,905
|
|
|||
Net cash provided by/(used in) operating activities of continuing operations
|
8,011
|
|
|
(13,657
|
)
|
|
34,280
|
|
|||
Net cash provided by/(used in) operating activities of discontinued operations
|
6,099
|
|
|
3,729
|
|
|
5,195
|
|
|||
Net cash provided by/(used in) operating activities
|
14,110
|
|
|
(9,928
|
)
|
|
39,475
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Cash paid for acquisitions, including deferred acquisition obligations
|
(217
|
)
|
|
(31,525
|
)
|
|
(2,744
|
)
|
|||
Capital investments in subsidiaries:
|
|
|
|
|
|
||||||
Bank(s)
|
—
|
|
|
(15,000
|
)
|
|
(34,000
|
)
|
|||
Non-banks
|
—
|
|
|
—
|
|
|
—
|
|
|||
Purchases of investment securities available for sale
|
—
|
|
|
(70,000
|
)
|
|
(175,000
|
)
|
|||
Sales of investment securities available for sale
|
—
|
|
|
245,000
|
|
|
—
|
|
|||
Cash received from divestitures
|
2,752
|
|
|
—
|
|
|
161,474
|
|
|||
Net cash (used in)/provided by in other investing activities
|
—
|
|
|
(6
|
)
|
|
(112
|
)
|
|||
Net cash provided by/(used in) investing activities of continuing operations
|
2,535
|
|
|
128,469
|
|
|
(50,382
|
)
|
|||
Net cash provided by/(used in) investing activities of discontinued operations
|
—
|
|
|
—
|
|
|
(9,815
|
)
|
|||
Net cash provided by/(used in) investing activities
|
2,535
|
|
|
128,469
|
|
|
(60,197
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Repurchase of debt
|
(6,988
|
)
|
|
—
|
|
|
(76,939
|
)
|
|||
Dividends paid to common shareholders
|
(3,089
|
)
|
|
(2,900
|
)
|
|
(2,688
|
)
|
|||
Dividends paid to preferred shareholders
|
(290
|
)
|
|
(3,099
|
)
|
|
(7,862
|
)
|
|||
Tax deficiency from certain stock compensation awards
|
(1,706
|
)
|
|
(1,613
|
)
|
|
—
|
|
|||
Repurchase of Series C Preferred stock
|
—
|
|
|
(154,000
|
)
|
|
—
|
|
|||
Proceeds from stock option exercises
|
205
|
|
|
474
|
|
|
341
|
|
|||
Proceeds from issuance of common stock, net
|
5,288
|
|
|
37,717
|
|
|
2,728
|
|
|||
Other equity adjustments
|
(1,657
|
)
|
|
3,148
|
|
|
(6,982
|
)
|
|||
Net cash provided by/(used in) financing activities of continuing operations
|
(8,237
|
)
|
|
(120,273
|
)
|
|
(91,402
|
)
|
|||
Net cash provided by/(used in) financing activities of discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net cash provided by/(used in) financing activities
|
(8,237
|
)
|
|
(120,273
|
)
|
|
(91,402
|
)
|
|||
Net (decrease)/increase in cash and cash equivalents
|
8,408
|
|
|
(1,732
|
)
|
|
(112,124
|
)
|
|||
Cash and cash equivalents at beginning of year
|
88,463
|
|
|
90,195
|
|
|
202,319
|
|
|||
Cash and cash equivalents at end of year
|
$
|
96,871
|
|
|
$
|
88,463
|
|
|
$
|
90,195
|
|
24.
|
REGULATORY MATTERS
|
|
Actual
|
|
For capital adequacy purposes
|
|
To be well capitalized under prompt corrective action provisions
|
|||||||||||||||
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||||
|
(In thousands)
|
|||||||||||||||||||
As of December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total risk-based capital
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Company
|
$
|
644,272
|
|
|
15.22
|
%
|
|
$
|
338,742
|
|
|
>8.0
|
|
|
$
|
423,428
|
|
|
>10.0
|
|
Boston Private Bank
|
538,643
|
|
|
12.80
|
|
|
336,667
|
|
|
8.0
|
|
|
420,834
|
|
|
10.0
|
|
|||
Tier I risk-based capital
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Company
|
535,467
|
|
|
12.65
|
|
|
169,371
|
|
|
4.0
|
|
|
254,057
|
|
|
6.0
|
|
|||
Boston Private Bank
|
485,481
|
|
|
11.54
|
|
|
168,333
|
|
|
4.0
|
|
|
252,500
|
|
|
6.0
|
|
|||
Tier I leverage capital
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Company
|
535,467
|
|
|
8.99
|
|
|
238,146
|
|
|
4.0
|
|
|
297,682
|
|
|
5.0
|
|
|||
Boston Private Bank
|
485,481
|
|
|
8.25
|
|
|
235,279
|
|
|
4.0
|
|
|
294,099
|
|
|
5.0
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total risk-based capital
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Company
|
$
|
585,020
|
|
|
14.43
|
%
|
|
$
|
324,312
|
|
|
>8.0
|
|
|
$
|
405,390
|
|
|
>10.0
|
|
Boston Private Bank
|
266,082
|
|
|
11.67
|
|
|
182,338
|
|
|
8.0
|
|
|
227,922
|
|
|
10.0
|
|
|||
Borel
|
140,950
|
|
|
11.89
|
|
|
94,821
|
|
|
8.0
|
|
|
118,527
|
|
|
10.0
|
|
|||
FPB
|
51,461
|
|
|
14.83
|
|
|
27,756
|
|
|
8.0
|
|
|
34,695
|
|
|
10.0
|
|
|||
Charter
|
35,324
|
|
|
16.20
|
|
|
17,440
|
|
|
8.0
|
|
|
21,800
|
|
|
10.0
|
|
|||
Tier I risk-based capital
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Company
|
528,071
|
|
|
13.03
|
|
|
162,156
|
|
|
4.0
|
|
|
243,234
|
|
|
6.0
|
|
|||
Boston Private Bank
|
237,524
|
|
|
10.42
|
|
|
91,169
|
|
|
4.0
|
|
|
136,753
|
|
|
6.0
|
|
|||
Borel
|
125,724
|
|
|
10.61
|
|
|
47,411
|
|
|
4.0
|
|
|
71,116
|
|
|
6.0
|
|
|||
FPB
|
47,012
|
|
|
13.55
|
|
|
13,878
|
|
|
4.0
|
|
|
20,817
|
|
|
6.0
|
|
|||
Charter
|
32,545
|
|
|
14.93
|
|
|
8,720
|
|
|
4.0
|
|
|
13,080
|
|
|
6.0
|
|
|||
Tier I leverage capital
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Company
|
528,071
|
|
|
8.77
|
|
|
240,741
|
|
|
4.0
|
|
|
300,926
|
|
|
5.0
|
|
|||
Boston Private Bank
|
237,524
|
|
|
6.93
|
|
|
137,193
|
|
|
4.0
|
|
|
171,492
|
|
|
5.0
|
|
|||
Borel
|
125,724
|
|
|
7.44
|
|
|
67,628
|
|
|
4.0
|
|
|
84,536
|
|
|
5.0
|
|
|||
FPB
|
47,012
|
|
|
9.36
|
|
|
20,099
|
|
|
4.0
|
|
|
25,123
|
|
|
5.0
|
|
|||
Charter
|
32,545
|
|
|
9.39
|
|
|
13,860
|
|
|
4.0
|
|
|
17,325
|
|
|
5.0
|
|
25.
|
LITIGATION AND CONTINGENCIES
|
26.
|
SELECTED QUARTERLY DATA (UNAUDITED)
|
|
2011 (1)
|
||||||||||||||
Fourth
Quarter
|
|
Third
Quarter
|
|
Second
Quarter
|
|
First
Quarter
|
|||||||||
(In thousands, except per share data)
|
|||||||||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Net interest income
|
$
|
44,137
|
|
|
$
|
45,072
|
|
|
$
|
46,024
|
|
|
$
|
43,711
|
|
Fees and other income
|
31,213
|
|
|
31,350
|
|
|
32,313
|
|
|
30,094
|
|
||||
Total revenues
|
75,350
|
|
|
76,422
|
|
|
78,337
|
|
|
73,805
|
|
||||
Provision / (credit) for loan losses
|
(2,500
|
)
|
|
4,500
|
|
|
(2,190
|
)
|
|
13,350
|
|
||||
Operating expense
|
59,485
|
|
|
56,478
|
|
|
62,465
|
|
|
61,705
|
|
||||
Income/ (loss) before income taxes
|
18,365
|
|
|
15,444
|
|
|
18,062
|
|
|
(1,250
|
)
|
||||
Income tax expense/ (benefit)
|
5,747
|
|
|
4,570
|
|
|
4,229
|
|
|
(178
|
)
|
||||
Net income/ (loss) from discontinued operations
|
1,347
|
|
|
1,567
|
|
|
1,516
|
|
|
1,670
|
|
||||
Less: Net income attributable to noncontrolling interests
|
903
|
|
|
762
|
|
|
804
|
|
|
747
|
|
||||
Net income/(loss) attributable to the Company
|
$
|
13,062
|
|
|
$
|
11,679
|
|
|
$
|
14,545
|
|
|
$
|
(149
|
)
|
Net earnings/ (loss) per share attributable to the Company’s common shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic earnings/ (loss) per share (2)
|
$
|
0.17
|
|
|
$
|
0.15
|
|
|
$
|
0.19
|
|
|
$
|
(0.01
|
)
|
Diluted earnings/ (loss) per share (2)
|
$
|
0.15
|
|
|
$
|
0.14
|
|
|
$
|
0.17
|
|
|
$
|
(0.01
|
)
|
|
2010 (1)
|
||||||||||||||
Fourth
Quarter
|
|
Third
Quarter
|
|
Second
Quarter
|
|
First
Quarter
|
|||||||||
(In thousands, except per share data)
|
|||||||||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Net interest income
|
$
|
44,953
|
|
|
$
|
46,444
|
|
|
$
|
45,017
|
|
|
$
|
44,311
|
|
Fees and other income
|
31,412
|
|
|
27,299
|
|
|
25,633
|
|
|
27,428
|
|
||||
Total revenues
|
76,365
|
|
|
73,743
|
|
|
70,650
|
|
|
71,739
|
|
||||
Provision for loan losses
|
32,551
|
|
|
32,050
|
|
|
14,962
|
|
|
7,615
|
|
||||
Operating expense
|
63,177
|
|
|
60,979
|
|
|
56,665
|
|
|
56,032
|
|
||||
Income/ (loss) before income taxes
|
(19,363
|
)
|
|
(19,286
|
)
|
|
(977
|
)
|
|
8,092
|
|
||||
Income tax expense/ (benefit)
|
(8,172
|
)
|
|
(12,412
|
)
|
|
(1,202
|
)
|
|
2,337
|
|
||||
Net income/ (loss) from discontinued operations
|
1,917
|
|
|
267
|
|
|
1,509
|
|
|
36
|
|
||||
Less: Net income attributable to noncontrolling interests
|
684
|
|
|
629
|
|
|
616
|
|
|
685
|
|
||||
Net income/ (loss) attributable to the Company
|
$
|
(9,958
|
)
|
|
$
|
(7,236
|
)
|
|
$
|
1,118
|
|
|
$
|
5,106
|
|
Net earnings/ (loss) per share attributable to the Company’s common shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted earnings/ (loss) per share (2)
|
$
|
(0.14
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
0.02
|
|
(1)
|
Due to rounding, the sum of the four quarters may not add to the year to date total.
|
(2)
|
Includes the effect of adjustments to net income/ (loss) attributable to the Company to arrive at net income/ (loss) attributable to common shareholders.
|
27.
|
SUBSEQUENT EVENTS
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES.
|
A.
|
Disclosure Controls and Procedures
|
a.
|
was made known to the certifying officers by others within the Company and its consolidated subsidiaries in the reports that it files or submits under the Exchange Act; and
|
b.
|
is recorded, processed, summarized, and reported within the time periods specified in the Securities Exchange Commission rules and forms.
|
B.
|
Management's Report on Internal Control Over Financial Reporting
|
C.
|
Changes in Internal Controls 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
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
|
1.
|
Financial Statements
|
2.
|
Financial Schedules
|
3.
|
Exhibits
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
|
|
|
|||||
Form
|
|
SEC Filing
Date
|
|
Exhibit
Number
|
|
Filed or
Furnished
with
this 10-K
|
|||||
3.1
|
|
|
Restated Articles of Organization of Boston Private Financial Holdings, Inc.
|
|
8-K
|
|
8/2/2010
|
|
3.1
|
|
|
3.2
|
|
|
Amended and Restated By-Laws of Boston Private Financial Holdings, Inc.
|
|
8-K
|
|
8/2/2010
|
|
3.2
|
|
|
4.1
|
|
|
Form of Warrant for Purchase of Shares of Common Stock, dated July 22, 2008
|
|
8-K
|
|
7/24/2008
|
|
4.2
|
|
|
4.2
|
|
|
Form of Warrant for Purchase of Shares of Common Stock that may be transferred by BP Holdco, L.P.
|
|
S-1
|
|
8/6/2010
|
|
4.2
|
|
|
4.3
|
|
|
Form of Warrant for Purchase of Shares of Common Stock (included as part of Exhibit 10.54)
|
|
8-A
|
|
2/2/2011
|
|
4.1
|
|
|
*10.1
|
|
|
Employee Incentive Stock Option Plan of Boston Private Financial Holdings, Inc.
|
|
S-1
|
|
4/1/1991
|
|
10.1
|
|
|
*10.2
|
|
|
Employee Incentive Compensation Plan of Boston Private Financial Holdings, Inc.
|
|
S-1
|
|
4/1/1991
|
|
10.2
|
|
|
*10.3
|
|
|
Boston Private Financial Holdings, Inc. 2001 Employee Stock Purchase Plan (As Amended and Restated as of January 1, 2010)
|
|
10-Q
|
|
5/7/2010
|
|
10.1
|
|
|
*10.4
|
|
|
Boston Private Financial Holdings, Inc. 2006 Non-Qualified Employee Stock Purchase Plan
|
|
S-8
|
|
6/2/2006
|
|
99.1
|
|
|
*10.5
|
|
|
1998 Amendment and Restatement of Directors' Stock Option Plan of Boston Private Financial Holdings, Inc., as amended February 7, 2003
|
|
10-K
|
|
3/12/2004
|
|
10.21
|
|
|
*10.6
|
|
|
Boston Private Financial Holdings, Inc. 2004 Stock Option and Incentive Plan
|
|
S-8
|
|
6/15/2004
|
|
99.1
|
|
|
*10.7
|
|
|
Form of Non-Qualified Stock Option Agreement for Employees under the Boston Private Financial Holdings, Inc. 2004 Stock Option and Incentive Plan
|
|
8-K
|
|
12/20/2006
|
|
10.1
|
|
|
*10.8
|
|
|
Form of Non-Qualified Stock Option Agreement for Non-Employee Directors under the Boston Private Financial Holdings, Inc. 2004 Stock Option and Incentive Plan
|
|
8-K
|
|
12/20/2006
|
|
10.2
|
|
|
*10.9
|
|
|
Form of Restricted Stock Award under the Boston Private Financial Holdings, Inc. 2004 Stock Option and Incentive Plan
|
|
8-K
|
|
12/20/2006
|
|
10.3
|
|
|
*10.10
|
|
|
Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
S-8
|
|
5/14/2009
|
|
99.1
|
|
|
*10.11
|
|
|
Form of Non-Qualified Stock Option Agreement for Employees under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
|
|
|
|
|
|
Filed
|
*10.12
|
|
|
Form of Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
10-Q
|
|
8/7/2009
|
|
10.3
|
|
|
*10.13
|
|
|
Vesting Clarification Letter, dated March 8, 2012, by and between Boston Private Financial Holdings, Inc. and Mark D. Thompson
|
|
|
|
|
|
|
|
Filed
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
|
|
|
|||||
Form
|
|
SEC Filing
Date
|
|
Exhibit
Number
|
|
Filed or
Furnished
with
this 10-K
|
|||||
*10.14
|
|
|
Form of Performance Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
10-K
|
|
3/11/2011
|
|
10.13
|
|
|
*10.15
|
|
|
Form of Amendment to Performance Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
10-K
|
|
3/11/2011
|
|
10.14
|
|
|
*10.16
|
|
|
Form of Non-Qualified Stock Option Agreement for Employees under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
10-Q
|
|
8/5/2011
|
|
10.4
|
|
|
*10.17
|
|
|
Form of Restricted Stock Agreement under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
10-Q
|
|
8/5/2011
|
|
10.2
|
|
|
*10.18
|
|
|
Form of Performance Restricted Stock Agreement under the Boston Private Financial Holdings, Inc. 2009 Stock Option and Incentive Plan
|
|
10-Q
|
|
8/5/2011
|
|
10.30
|
|
|
*10.19
|
|
|
Boston Private Financial Holdings, Inc. Amended and Restated 1997 Long-Term Incentive Plan
|
|
10-K
|
|
3/13/2002
|
|
10.2
|
|
|
*10.20
|
|
|
Boston Private Financial Holdings, Inc. Deferred Compensation Plan, As Amended and Restated as of January 1, 2009
|
|
10-K
|
|
3/12/2010
|
|
10.4
|
|
|
*10.21
|
|
|
Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan
|
|
8-K
|
|
6/8/2010
|
|
10.20
|
|
|
*10.22
|
|
|
First Amendment to Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan
|
|
8-K
|
|
8/2/2010
|
|
10.1
|
|
|
*10.23
|
|
|
Inducement Restricted Stock Award Agreement Under the Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan, dated August 2, 2010, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
8-K
|
|
8/2/2010
|
|
10.2
|
|
|
*10.24
|
|
|
Time-Based Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan, dated August 2, 2010, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
8-K
|
|
8/2/2010
|
|
10.3
|
|
|
*10.25
|
|
|
Vesting Clarification Letter, dated March 8, 2012, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
|
|
|
|
|
|
Filed
|
*10.26
|
|
|
2009 Performance Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan, dated August 2, 2010, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
8-K
|
|
8/2/2010
|
|
10.4
|
|
|
*10.27
|
|
|
Amendment to 2009 Performance Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan, dated March 10, 2011, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
10-K
|
|
3/11/2011
|
|
10.22
|
|
|
*10.28
|
|
|
2010 Performance Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan, dated August 2, 2010, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
8-K
|
|
8/2/2010
|
|
10.5
|
|
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
|
|
|
|||||
Form
|
|
SEC Filing
Date
|
|
Exhibit
Number
|
|
Filed or
Furnished
with
this 10-K
|
|||||
*10.29
|
|
|
Amendment to 2010 Performance Restricted Stock Award Agreement under the Boston Private Financial Holdings, Inc. 2010 Inducement Stock Plan, dated March 10, 2011, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
10-K
|
|
3/11/2011
|
|
10.24
|
|
|
*10.30
|
|
|
Boston Private Financial Holdings, Inc. Executive Bonus Plan
|
|
8-K
|
|
2/3/2009
|
|
10.4
|
|
|
*10.31
|
|
|
Annual Executive Incentive Plan of Boston Private Financial Holdings, Inc.
|
|
8-K
|
|
5/2/2011
|
|
99.1
|
|
|
*10.32
|
|
|
Borel Private Bank & Trust Company 1998 Stock Option Plan
|
|
S-8
|
|
12/3/2001
|
|
99.1
|
|
|
*10.33
|
|
|
First Private Bank & Trust 1994 Stock Option Plan
|
|
S-8
|
|
3/5/2004
|
|
99.1
|
|
|
*10.34
|
|
|
Employment Agreement, dated June 7, 2010, by and between Boston Private Financial Holdings, Inc. and Clayton G. Deutsch
|
|
8-K
|
|
6/8/2010
|
|
10.1
|
|
|
*10.35
|
|
|
Employment Agreement by and between Boston Private Financial Holdings, Inc. and Mark D. Thompson dated March 29, 2011
|
|
8-K
|
|
3/31/2011
|
|
10.1
|
|
|
*10.36
|
|
|
Change in Control Protection Agreement, dated November 21, 2003, by and between Boston Private Financial Holdings, Inc. and Margaret W. Chambers
|
|
10-K
|
|
3/15/2005
|
|
10.24
|
|
|
*10.37
|
|
|
Non-Solicitation/Non-Accept and Confidentiality Agreement and Release, dated March 1, 2005, by and between Boston Private Financial Holdings, Inc. and Joseph H. Cromarty
|
|
8-K
|
|
3/7/2005
|
|
10.1
|
|
|
*10.38
|
|
|
Change in Control Protection Agreement, dated January 28, 2009, by and between Boston Private Financial Holdings, Inc. and James D. Dawson
|
|
8-K
|
|
2/3/2009
|
|
10.1
|
|
|
*10.39
|
|
|
Change in Control Protection Agreement, dated January 28, 2009, by and between Boston Private Financial Holdings, Inc. and David J. Kaye
|
|
8-K
|
|
2/3/2009
|
|
10.2
|
|
|
*10.40
|
|
|
Letter Agreement, dated July 3, 2007, by and between Boston Private Financial Holdings, Inc. and David J. Kaye
|
|
10-Q
|
|
11/6/2009
|
|
10.1
|
|
|
*10.41
|
|
|
Change in Control Protection Agreement, dated January 28, 2009, by and between Boston Private Financial Holdings, Inc. and Martha T. Higgins
|
|
8-K
|
|
2/3/2009
|
|
10.3
|
|
|
*10.42
|
|
|
Change in Control Protection Agreement, dated October 27, 2009, by and between Boston Private Financial Holdings, Inc. and George L. Alexakos
|
|
8-K
|
|
10/28/2009
|
|
10.1
|
|
|
*10.43
|
|
|
Agreement, dated October 8, 2010, by and between Boston Private Financial Holdings, Inc. and Walter M. Pressey
|
|
8-K
|
|
10/14/2010
|
|
10.1
|
|
|
10.44
|
|
|
Agreement, dated October 8, 2010, by and between Boston Private Financial Holdings, Inc. and Joseph H. Cromarty
|
|
8-K
|
|
10/14/2010
|
|
10.2
|
|
|
10.45
|
|
|
Consulting Agreement, dated October 22, 2010, by and between Boston Private Financial Holdings, Inc. and Joseph H. Cromarty
|
|
8-K
|
|
10/27/2010
|
|
10.1
|
|
|
10.46
|
|
|
Indenture, dated October 12, 2004, between Boston Private Financial Holdings, Inc. and Sun Trust Bank, as debenture trustee
|
|
8-K
|
|
10/15/2004
|
|
10.1
|
|
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
|
|
|
|||||
Form
|
|
SEC Filing
Date
|
|
Exhibit
Number
|
|
Filed or
Furnished
with
this 10-K
|
|||||
10.47
|
|
|
Guarantee Agreement, dated as of October 12, 2004, by Boston Private Financial Holdings, Inc. and Sun Trust Bank, as trustee, for the benefit of the holders from time to time of the Trust Preferred Securities and Trust Common Securities of Boston Private Capital Trust I
|
|
8-K
|
|
10/15/2004
|
|
10.2
|
|
|
10.48
|
|
|
Amended and Restated Declaration of Trust of Boston Private Capital Trust I, dated October 12, 2004
|
|
8-K
|
|
10/15/2004
|
|
10.3
|
|
|
10.49
|
|
|
Indenture, dated September 27, 2005, between Boston Private Financial Holdings, Inc. and Wilmington Trust Company, as debenture trustee
|
|
8-K
|
|
9/30/2005
|
|
10.1
|
|
|
10.50
|
|
|
Guarantee Agreement, dated as of September 27, 2005, by Boston Private Financial Holdings, Inc. and Wilmington Trust Company, as trustee, for the benefit of the holders from time to time of the Capital Securities of Boston Private Capital Trust II
|
|
8-K
|
|
9/30/2005
|
|
10.2
|
|
|
10.51
|
|
|
Amended and Restated Declaration of Trust of Boston Private Capital Trust II, dated September 27, 2005
|
|
8-K
|
|
9/30/2005
|
|
10.3
|
|
|
10.52
|
|
|
Indenture, dated March 14, 2007, between Boston Private, Inc. and U.S. Bank, National Association, as Trustee
|
|
8-K
|
|
7/9/2007
|
|
4.1
|
|
|
10.53
|
|
|
Investment Agreement, dated as of July 22, 2008, between Boston Private Financial Holdings, Inc. and BP Holdco, L.P.
|
|
8-K
|
|
7/24/2008
|
|
10.1
|
|
|
10.54
|
|
|
Amendment No. 1 to Investment Agreement, dated December 15, 2009, by and among Boston Private Financial Holdings, Inc. and BP Holdco, L.P.
|
|
8-K
|
|
12/18/2009
|
|
10.1
|
|
|
10.55
|
|
|
Investment Agreement, dated June 18, 2010, by and between Boston Private Financial Holdings, Inc. and BP Holdco, L.P.
|
|
8-K
|
|
6/21/2010
|
|
10.1
|
|
|
10.56
|
|
|
Warrant Agreement, dated July 22, 2008, between Boston Private Financial Holdings, Inc. and the warrant agent
|
|
8-K
|
|
7/24/2008
|
|
10.2
|
|
|
10.57
|
|
|
Warrant Agreement, dated February 1, 2011, among Boston Private Financial Holdings, Inc., Computershare, Inc. and Computershare Trust Company, N.A.
|
|
8-A
|
|
2/2/2011
|
|
4.1
|
|
|
10.58
|
|
|
Amended and Restated Commercial Lease, dated June 30, 2004, by and between Boston Private Financial Holdings, Inc. and Leggat McCall Properties Management, Inc., as amended
|
|
10-K
|
|
3/12/2010
|
|
10.3
|
|
|
21.1
|
|
|
List of Subsidiaries of Boston Private Financial Holdings, Inc.
|
|
|
|
|
|
|
|
Filed
|
23.1
|
|
|
Consent of KPMG LLP, an independent registered public accounting firm
|
|
|
|
|
|
|
|
Filed
|
31.1
|
|
|
Certification of Chief Executive Officer pursuant to Rule 13a - 14(a)/15d - 14(a) under the Securities Exchange Act of 1934
|
|
|
|
|
|
|
|
Filed
|
31.2
|
|
|
Certification of Chief Financial Officer pursuant to Rule 13a - 14(a)/15d - 14(a) under the Securities Exchange Act of 1934
|
|
|
|
|
|
|
|
Filed
|
32.1
|
|
|
Certification of the Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
Furnished
|
Exhibit
Number
|
|
Description
|
|
Incorporated by Reference
|
|
|
|||||
Form
|
|
SEC Filing
Date
|
|
Exhibit
Number
|
|
Filed or
Furnished
with
this 10-K
|
|||||
32.2
|
|
|
Certification of the Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
Furnished
|
101.INS
|
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
Furnished
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
Furnished
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
Furnished
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
Furnished
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
Furnished
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
Furnished
|
|
|
|
|
|
|
|
|
|
|
|
|
|
B
OSTON
P
RIVATE
F
INANCIAL
H
OLDINGS
, I
NC
.
|
|
|
|
By:
|
|
/s/ C
LAYTON
G. D
EUTSCH
|
|
|
Clayton G. Deutsch
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
/s/ C
LAYTON
G. D
EUTSCH
|
|
President, Chief Executive Officer
and Director (Principal Executive Officer)
|
|
March 13, 2012
|
Clayton G. Deutsch
|
|
|
|
|
|
|
|
|
|
/s/ D
AVID
J. K
AYE
|
|
Executive Vice President and
Chief Financial Officer (Principal Financial Officer)
|
|
March 13, 2012
|
David J. Kaye
|
|
|
|
|
|
|
|
|
|
/s/ J
OSEPH
D. R
EGAN
|
|
Senior Vice President, Controller and Treasurer
(Principal Accounting Officer)
|
|
March 13, 2012
|
Joseph D. Regan
|
|
|
|
|
|
|
|
|
|
/s/ S
TEPHEN
M. W
ATERS
|
|
Chairman
|
|
March 13, 2012
|
Stephen M. Waters
|
|
|
|
|
|
|
|
|
|
/s/ H
ERBERT
S. A
LEXANDER
|
|
Director
|
|
March 13, 2012
|
Herbert S. Alexander
|
|
|
|
|
|
|
|
|
|
/s/ E
UGENE
S. C
OLANGELO
|
|
Director
|
|
March 13, 2012
|
Eugene S. Colangelo
|
|
|
|
|
|
|
|
|
|
/s/ L
YNN
T
HOMPSON
H
OFFMAN
|
|
Director
|
|
March 13, 2012
|
Lynn Thompson Hoffman
|
|
|
|
|
|
|
|
|
|
/s/ D
EBORAH
F. K
UENSTNER
|
|
Director
|
|
March 13, 2012
|
Deborah F. Kuenstner
|
|
|
|
|
|
|
|
|
|
/s/ J
OHN
M
ORTON
III
|
|
Director
|
|
March 13, 2012
|
John Morton III
|
|
|
|
|
|
|
|
|
|
/s/ W
ILLIAM
J. S
HEA
|
|
Director
|
|
March 13, 2012
|
William J. Shea
|
|
|
|
|
|
|
|
|
|
/s/ D
R
. A
LLEN
L. S
INAI
|
|
Director
|
|
March 13, 2012
|
Dr. Allen L. Sinai
|
|
|
|
|
1.
|
Exercisability Schedule
. No portion of this Stock Option may be exercised until such portion shall have become exercisable. Except as set forth below, and subject to the discretion of the Administrator (as defined in Section 2 of the Plan) to accelerate the exercisability schedule hereunder, this Stock Option shall be exercisable with respect to the following number of Option Shares on the dates indicated, so long as the Optionee remains an employee of the Company or a Subsidiary through each such date:
|
Incremental Number of
Option Shares Exercisable
|
Exercisability Date
|
_____________
|
____________
|
_____________
|
____________
|
_____________
|
____________
|
_____________
|
____________
|
|
BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
|
By:
|
|
Title:
|
|
Dated:
|
|
|
|
|
|
|
Optionee's Signature
|
|
|
|
|
|
|
|
Optionee's name and address:
|
|
|
|
|
|
|
|
|
|
|
|
|
Title:
|
Chair, Compensation Committee of the Board of Directors
|
Title:
|
Chair, Compensation Committee of the Board of Directors
|
Subsidiaries of the Company
|
|
State or Other
Jurisdiction of
Incorporation
|
Anchor Capital Holdings LLC
|
|
DE
|
Anchor/Russell Capital Advisors LLC
|
|
DE
|
Anchor Capital Advisors LLC
|
|
DE
|
Bingham, Osborn & Scarborough, LLC
|
|
CA
|
Boston Private Bank & Trust Company (1)
|
|
MA
|
BPB Securities Corporation
|
|
MA
|
Boston Private Asset Management, Inc.
|
|
MA
|
Ten Winthrop Properties
|
|
MA
|
Boston Private Capital, Inc.
|
|
MA
|
BPB Securities Corporation II
|
|
MA
|
Lerob LLC
|
|
CA
|
REFS Realty LLC
|
|
DE
|
REFS REALTY 2011 LLC
|
|
WA
|
RE Management Services LLC
|
|
CA
|
Boston Private Community Investment LLC
|
|
MA
|
BPFH Manager LLC
|
|
DE
|
Boston Private (PA) Corporation
|
|
DE
|
Davidson Trust Company
|
|
PA
|
Dalton, Greiner, Hartman & Maher & Co. LLC
|
|
DE
|
DGHM Management LLC
|
|
DE
|
DGHM Ultra Value Partners LP
|
|
DE
|
DGHM Enhanced Value LP
|
|
DE
|
DGHM Enhanced Value LTD
|
|
Grand Cayman Island
|
DGHM Midcap Partners LP
|
|
DE
|
DGHM Investment Trust
|
|
DE
|
DGHM 130/30 Fund LP
|
|
DE
|
DGHM Partners LLC
|
|
DE
|
KLS Professional Advisors Group, LLC
|
|
DE
|
Boston Private Capital Trust I
|
|
DE
|
Boston Private Capital Trust II
|
|
DE
|
First State (CA) Statutory Trust I
|
|
DE
|
Gibraltar Financial Statutory Trust I
|
|
DE
|
Charter Trust I
|
|
DE
|
(1)
|
Also does business as Borel Private Bank & Trust Company, A Division of Boston Private Bank & Trust Company in the State of California.
|
1.
|
I have reviewed this annual report on Form 10-K of Boston Private Financial Holdings, Inc. (the “registrant”);
|
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 period 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 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 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.
|
|
|
/s/ C
LAYTON
G. D
EUTSCH
|
Date: March 13, 2012
|
|
Clayton G. Deutsch
President and Chief Executive Officer
|
|
1.
|
I have reviewed this annual report on Form 10-K of Boston Private Financial Holdings, Inc. (the “registrant”);
|
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 period 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 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 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.
|
|
|
/s/ David J. Kaye
|
Date: March 13, 2012
|
|
David J. Kaye
Chief Financial Officer
|
|
|
|
|
|
|
/s/ CLAYTON G. DEUTSCH
|
|
|
|
|
|
Clayton G. Deutsch
President and Chief Executive Officer
|
Date: March 13, 2012
|
|
|
|
|
|
|
|
|
|
/s/ DAVID J. KAYE
|
|
|
|
|
|
David J. Kaye
Chief Financial Officer
|
Date: March 13, 2012
|
|
|
|
|