FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2014

Components of change in fair value of level 3 available for sale securities

The following table provides the components of the change in fair value of level 3 available for sale securities for the periods presented.



	Three months ended September 30,				Nine months ended September 30,
	2014		2013		2014			2013

Level 3 AFS securities at beginning of period	$	6,793	$	—	$	7,583		$	—
Purchases	4,600		—		4,600			—
Sales, calls or maturities	—		—		(1,000		)	—
Changes in unrealized gains and losses	30		—		240			—
Level 3 AFS securities at end of period	$	11,423	$	—	$	11,423		$	—

Schedule of changes in fair value of interest rate lock commitments

The following table provides the components of the change in fair value of interest rate lock commitments for the periods presented.



	Three months ended September 30,						Nine months ended September 30,
	2014			2013			2014			2013

Interest rate lock commitments at beginning of period	$	296		$	648		$	354		$	795
Fair value of acquired Yadkin interest rate lock commitments	231			—			231			—
Issuances	906			213			1,529			2,403
Settlements	(986		)	(494		)	(1,667		)	(2,831		)
Interest rate lock commitments at end of period	$	447		$	367		$	447		$	367

Fair value and measurement level of assets and liabilities

The following tables summarize information about assets and liabilities measured at fair value.



			Fair Value Measurements as of September 30, 2014
	Assets/(Liabilities) Measured at		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Fair Value		(Level 1)		(Level 2)		(Level 3)
Measured at fair value on a recurring basis:
Securities available for sale:
GSE obligations	$	14,882	$	—	$	14,882	$	—
SBA-guaranteed securities	62,601		62,601		—		—
Mortgage-backed securities issued by GSE	446,499		—		446,499		—
Corporate bonds	120,387		2,524		106,440		11,423
Non-agency CMBS	3,638		—		3,638		—
Municipal bonds	43,632		—		43,632		—
Other debt securities	498		498		—		—
Equity securities	2,856		2,856		—		—
SBA-guaranteed loans held for sale	2,324		—		2,324		—
SBA loans held for investment	1,241		—		1,241		—
Derivative assets	4,217		—		3,770		447
Derivative liabilities	223		—		223		—

Measured at fair value on a non-recurring basis:
Impaired loans	$	10,050	$	—	$	—	$	10,050
Foreclosed assets	11,078		—		—		11,078



			Fair Value Measurements as of December 31, 2013
	Assets/(Liabilities) Measured at		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	Fair Value		(Level 1)		(Level 2)		(Level 3)
Measured at fair value on a recurring basis:
Securities available for sale:
GSE obligations	$	14,673	$	—	$	14,673	$	—
SBA-guaranteed securities	65,880		65,880		—		—
Mortgage-backed securities issued by GSE	205,260		—		205,260		—
Corporate bonds	110,740		—		103,157		7,583
Non-agency CMBS	5,938		—		5,938		—
Municipal bonds	601		—		601		—
Other debt securities	253		253		—		—
Equity securities	1,043		1,043		—		—
Derivative assets	4,717		—		4,363		354

Measured at fair value on a non-recurring basis:
Impaired loans	$	8,264	$	—	$	—	$	8,264
Foreclosed assets	10,823		—		—		10,823

Quantitative Information about level 3 fair value measurements

The table below outlines the valuation techniques, unobservable inputs, and the range of quantitative inputs used in the valuations.



	Valuation Technique	Unobservable Input	Range	Fair Value as of September 30, 2014
Recurring measurements:
Investment securities	Pricing model	Illiquidity or credit factor in discount rates	1-2%	$	11,423

Interest rate lock commitments	Pricing model	Pull through rates	80-95%	$	447

Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts	15-50%	$	10,050
	Discounted expected cash flows	Expected loss rates	0-75%
	Discounted expected cash flows	Discount rates	2-8%
Foreclosed assets	Discounted appraisals	Collateral discounts	15-50%	$	11,078

Schedule of carrying amounts and estimated fair values of financial instruments

The following tables summarize the carrying amounts and estimated fair values of the Company's financial instruments.



	September 30, 2014
	Carrying Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	91,075	$	91,075	$	91,075	$	—	$	—
Investment securities available for sale	694,993		694,993		68,479		615,091		11,423
Investment securities held to maturity	39,728		40,404		—		40,404		—
Loans held for sale	26,853		26,853		—		26,853		—
Loans, net	2,819,785		2,847,744		—		1,241		2,846,503
Federal Home Loan Bank stock	19,320		19,320		—		19,320		—
Bank-owned life insurance	76,500		76,500		—		76,500		—
Derivative assets	4,218		4,218		—		3,771		447
Purchased accounts receivable	43,187		43,187		—		43,187		—
Accrued interest receivable	11,225		11,225		—		11,225		—

Financial liabilities:
Deposits	3,184,939		3,181,179		—		3,181,179		—
Short-term borrowings	216,500		216,500		—		—		216,500
Long-term debt	210,154		213,316		—		—		213,316
Derivative liabilities	223		223		—		223		—
Accrued interest payable	2,048		2,048		—		2,048		—



	December 31, 2013
	Carrying Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	100,780	$	100,780	$	100,780	$	—	$	—
Investment securities available for sale	404,388		404,388		67,176		329,882		7,583
Investment securities held to maturity	500		500		—		—		500
Loans held for sale	8,663		8,663		—		8,663		—
Loans, net	1,385,790		1,380,437		—		—		1,380,437
Federal Home Loan Bank stock	8,929		8,929		—		8,929		—
Bank-owned life insurance	33,148		33,148		—		33,148		—
Derivative assets	4,717		4,717		—		4,363		354
Purchased accounts receivable	18,725		18,725		—		18,725		—
Accrued interest receivable	5,356		5,356		—		5,356		—

Financial liabilities:
Deposits	1,672,231		1,674,175		—		1,674,175		—
Short-term borrowings	126,500		126,726		—		—		126,726
Long-term debt	72,921		72,397		—		—		72,397
Accrued interest payable	1,817		1,817		—		1,817		—

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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