FAIR VALUES OF FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2015

Fair Value Assets Measured on a Recurring Basis

The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of the dates indicated:



			Fair Value Measurement Level
	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In thousands)
September 30, 2015
Assets
Available for sale securities:
SBA loan pools securities	$	1,516	$	—	$	1,516	$	—
U.S. government-sponsored entities and agency securities	2,001		—		2,001		—
Private label residential mortgage-backed securities	1,917		—		1,917		—
Corporate Bonds	26,247		—		26,247		—
Commercial mortgage-backed securities	115,234		—		115,234		—
Agency mortgage-backed securities	546,304		—		546,304		—
Loans held for sale	351,760		—		351,760		—
Derivative assets ⁽¹⁾	9,748		—		9,748		—
Mortgage servicing rights ⁽²⁾	40,837		—		—		40,837
Liabilities
Derivative liabilities ⁽³⁾	5,873		—		5,873		—
December 31, 2014
Assets
Available for sale securities:
SBA loan pools securities	$	1,715	$	—	$	1,715	$	—
U.S. government-sponsored entities and agency securities	1,982		—		1,982		—
Private label residential mortgage-backed securities	3,168		—		3,168		—
Agency mortgage-backed securities	338,830		—		338,830		—
Loans held for sale	278,749		—		278,749		—
Derivative assets ⁽¹⁾	6,379		—		6,379		—
Mortgage servicing rights ⁽²⁾	19,082		—		—		19,082
Liabilities
Derivative liabilities ⁽³⁾	3,235		—		3,235		—


(1)	Included in Other Assets on the Consolidated Statements of Financial Condition


(2)	Included in Servicing Rights, Net and Servicing Rights Held For Sale on the Consolidated Statements of Financial Condition


(3)	Included in Accrued Expenses and Other Liabilities on the Consolidated Statements of Financial Condition

Fair Value Liabilities Measured on a Recurring Basis

The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of the dates indicated:



			Fair Value Measurement Level
	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In thousands)
September 30, 2015
Assets
Available for sale securities:
SBA loan pools securities	$	1,516	$	—	$	1,516	$	—
U.S. government-sponsored entities and agency securities	2,001		—		2,001		—
Private label residential mortgage-backed securities	1,917		—		1,917		—
Corporate Bonds	26,247		—		26,247		—
Commercial mortgage-backed securities	115,234		—		115,234		—
Agency mortgage-backed securities	546,304		—		546,304		—
Loans held for sale	351,760		—		351,760		—
Derivative assets ⁽¹⁾	9,748		—		9,748		—
Mortgage servicing rights ⁽²⁾	40,837		—		—		40,837
Liabilities
Derivative liabilities ⁽³⁾	5,873		—		5,873		—
December 31, 2014
Assets
Available for sale securities:
SBA loan pools securities	$	1,715	$	—	$	1,715	$	—
U.S. government-sponsored entities and agency securities	1,982		—		1,982		—
Private label residential mortgage-backed securities	3,168		—		3,168		—
Agency mortgage-backed securities	338,830		—		338,830		—
Loans held for sale	278,749		—		278,749		—
Derivative assets ⁽¹⁾	6,379		—		6,379		—
Mortgage servicing rights ⁽²⁾	19,082		—		—		19,082
Liabilities
Derivative liabilities ⁽³⁾	3,235		—		3,235		—


(1)	Included in Other Assets on the Consolidated Statements of Financial Condition


(2)	Included in Servicing Rights, Net and Servicing Rights Held For Sale on the Consolidated Statements of Financial Condition


(3)	Included in Accrued Expenses and Other Liabilities on the Consolidated Statements of Financial Condition

Reconciliation of Assets Measured at Fair Value on Recurring Basis

The following table presents a reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the periods indicated:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(In thousands)
Mortgage servicing rights
Balance at beginning of period	$	34,198		$	9,816		$	19,082		$	13,535
Transfers out of Level 3 ⁽¹⁾	—			—			—			(9,185		)
Total gains or losses (realized/unrealized):
Included in earnings—realized	—			—			—			—
Included in earnings—fair value adjustment	(3,097		)	110			(2,087		)	(140		)
Included in other comprehensive income	—			—			—			—
Amortization of premium (discount)	—			—			—			—
Additions	12,143			7,735			36,034			18,057
Sales and settlements	(2,407		)	(6,285		)	(12,192		)	(10,891		)
Balance at end of period	$	40,837		$	11,376		$	40,837		$	11,376


(1)	The Company’s policy is to recognize transfers in and transfers out as of the actual date of the event or change in circumstances that causes the transfer.

Quantitative Information About Level 3 Fair Value Measurements

The following table presents quantitative information about Level 3 fair value measurements on a recurring basis, other than the mortgage servicing rights were valued based on a market bid that settled subsequent to that date, which was included as Level 3 at December 31, 2014, as of the dates indicated:



	Fair Value (In thousands)		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
September 30, 2015
Mortgage servicing rights	$	40,837	Discounted cash flow	Discount rate	9.00% to 18.00% (9.88%)
				Prepayment rate	6.07% to 34.69% (12.09%)
December 31, 2014
Mortgage servicing rights	$	13,135	Discounted cash flow	Discount rate	9.00% to 19.50% (10.09%)
				Prepayment rate	4.59% to 31.02% (13.22%)
September 30, 2014
Mortgage servicing rights	$	11,376	Discounted cash flow	Discount rate	10.00% to 21.22% (10.70%)
				Prepayment rate	4.71% to 34.76% (12.41%)

Schedule of Assets and Liabilities Measured on Non-recurring Basis

The following table presents the Company’s financial assets and liabilities measured at fair value on a non-recurring basis as of the dates indicated:



			Fair Value Measurement Level
	Carrying Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In thousands)
September 30, 2015
Assets
Impaired loans:
Single family residential mortgage	$	3,976	$	—	$	—	$	3,976
Commercial and industrial	1,156		—		—		1,156
Other real estate owned:
Single family residential	34		—		—		34
December 31, 2014
Assets
Impaired loans:
Single family residential mortgage	$	6,206	$	—	$	—	$	6,206
Commercial and industrial	4,313		—		—		4,313
SBA servicing rights	484		—		—		484
Other real estate owned:
Single family residential	423		—		—		423

Schedule of Gains and (Losses) Recognized on Assets Measured at Fair Value on Non-recurring Basis

The following table presents the gains and (losses) recognized on assets measured at fair value on a non-recurring basis for the periods indicated:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(In thousands)
Impaired loans:
Single family residential mortgage	$	—		$	(18	)	$	—		$	(350	)
Real estate mortgage	—			88			—			88
SBA	1			—			1			—
Other consumer	—			—			—			(2		)
Other real estate owned:
Single family residential	(16		)	—			(15		)	—

Carrying Amounts and Estimated Fair Values of Financial Instruments

The following table presents the carrying amounts and estimated fair values of financial assets and liabilities as of the dates indicated:



	Carrying		Fair Value Measurement Level
	Amount		Level 1		Level 2		Level 3		Total
	(In thousands)
September 30, 2015
Financial assets
Cash and cash equivalents	$	378,963	$	378,963	$	—	$	—	$	378,963
Time deposits in financial institutions	1,900		1,900		—		—		1,900
Securities available for sale	693,219		—		693,219		—		693,219
Securities held to maturity	529,532		—		526,958		—		526,958
FHLB and other bank stock	40,643		—		40,643		—		40,643
Loans held for sale	596,565		—		600,774		—		600,774
Loans and leases receivable, net of allowance	4,695,303		—		—		4,817,939		4,817,939
Accrued interest receivable	19,706		19,706		—		—		19,706
Derivative assets	9,748		—		9,748		—		9,748
Financial liabilities
Deposits	5,421,990		—		—		5,180,669		5,180,669
Advances from Federal Home Loan Bank	830,000		—		830,106		—		830,106
Long term debt	262,779		—		261,026		—		261,026
Derivative liabilities	5,873		—		5,873		—		5,873
Accrued interest payable	6,635		6,635		—		—		6,635
December 31, 2014
Financial assets
Cash and cash equivalents	$	231,199	$	231,199	$	—	$	—	$	231,199
Time deposits in financial institutions	1,900		1,900		—		—		1,900
Securities available for sale	345,695		—		345,695		—		345,695
FHLB and other bank stock	42,241		—		42,241		—		42,241
Loans held for sale	1,187,090		—		1,195,834		—		1,195,834
Loans and leases receivable, net of allowance	3,919,642		—		—		4,045,465		4,045,465
Accrued interest receivable	15,113		15,113		—		—		15,113
Derivative assets	6,379		—		6,379		—		6,379
Financial liabilities
Deposits	4,671,831		—		—		4,575,264		4,575,264
Advances from Federal Home Loan Bank	633,000		—		633,083		—		633,083
Long term debt	93,569		—		100,788		—		100,788
Derivative liabilities	3,235		—		3,235		—		3,235
Accrued interest payable	2,044		2,044		—		—		2,044