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Fair value of financial instruments (Tables)

9 Months Ended

Sep. 30, 2020

Estimated Fair Values of Financial Instruments

The following table contains the estimated fair values and the related carrying values of the Company's financial instruments. Items which are not financial instruments are not included.


	Fair Value
September 30, 2020	Carrying amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	1,062,391	$	1,062,391	$	—	$	—	$	1,062,391
Investment securities	1,164,910		—		1,164,910		—		1,164,910

Loans, net	7,029,565		—		—		7,119,243		7,119,243
Loans held for sale	851,951		—		851,951		—		851,951
Interest receivable	47,120		39		5,284		41,797		47,120
Mortgage servicing rights	71,535		—		—		71,535		71,535
Derivatives	82,587		—		82,587		—		82,587
Financial liabilities:
Deposits:
Without stated maturities	$	7,530,117	$	7,530,117	$	—	$	—	$	7,530,117
With stated maturities	1,563,630		—		1,573,537		—		1,573,537
Securities sold under agreement to repurchase and federal funds sold	32,469		32,469		—		—		32,469
Federal Home Loan Bank advances	200,000		—		206,232		—		206,232
Subordinated debt	189,750		—		—		189,711		189,711
Other borrowings	16,619		—		16,619		—		16,619
Interest payable	5,961		237		5,724		—		5,961
Derivatives	45,955		—		45,955		—		45,955


	Fair Value
December 31, 2019	Carrying amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	232,681	$	232,681	$	—	$	—	$	232,681
Investment securities	691,676		—		691,676		—		691,676

Loans, net	4,378,503		—		—		4,363,903		4,363,903
Loans held for sale	262,518		—		262,518		—		262,518
Interest receivable	17,083		—		3,282		13,801		17,083
Mortgage servicing rights	75,521		—		—		75,521		75,521
Derivatives	21,981		—		21,981		—		21,981
Financial liabilities:
Deposits:
Without stated maturities	$	3,743,085	$	3,743,085	$	—	$	—	$	3,743,085
With stated maturities	1,191,853		—		1,200,145		—		1,200,145
Securities sold under agreement to repurchase and federal funds sold	23,745		23,745		—		—		23,745
Federal Home Loan Bank advances	250,000		—		250,213		—		250,213
Subordinated debt	30,930		—		29,706		—		29,706
Interest payable	6,465		376		6,089		—		6,465
Derivatives	17,933		—		17,933		—		17,933

Balances and Levels of Assets Measured at Fair Value on Recurring Basis

The balances and levels of the assets measured at fair value on a recurring basis at September 30, 2020 are presented in the following table:


September 30, 2020	Quoted prices in active markets for identical assets (liabilities) (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)		Total
Recurring valuations:
Financial assets:
Available-for-sale securities:
U.S. government agency securities	$	—	$	1,994	$	—	$	1,994
Mortgage-backed securities	—		738,106		—		738,106
Municipals, tax-exempt	—		374,880		—		374,880
Treasury securities	—		21,700		—		21,700
Corporate securities	—		1,987		—		1,987
Equity securities	—		4,389		—		4,389
Total	$	—	$	1,143,056	$	—	$	1,143,056
Loans held for sale	$	—	$	851,951	$	—	$	851,951
Mortgage servicing rights	—		—		71,535		71,535
Derivatives	—		82,587		—		82,587
Financial Liabilities:
Derivatives	—		45,955		—		45,955

The balances and levels of the assets measured at fair value on a recurring basis at December 31, 2019 are presented in the following table:


At December 31, 2019	Quoted prices in active markets for identical assets (liabilities) (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)		Total
Recurring valuations:
Financial assets:
Available-for-sale securities:

Mortgage-backed securities	$	—	$	477,312	$	—	$	477,312
Municipals, tax-exempt	—		189,235		—		189,235
Treasury securities	—		7,448		—		7,448
Corporate securities	—		1,022		—		1,022
Equity securities	—		3,295		—		3,295
Total	$	—	$	678,312	$	—	$	678,312
Loans held for sale	$	—	$	262,518	$	—	$	262,518
Mortgage servicing rights	—		—		75,521		75,521
Derivatives	—		21,981		—		21,981
Financial Liabilities:
Derivatives	—		17,933		—		17,933

Balances and Levels of Assets Measured at Fair Value on Non-recurring Basis

The balances and levels of the assets measured at fair value on a non-recurring basis at September 30, 2020 are presented in the following table:


At September 30, 2020	Quoted prices in active markets for identical assets (liabilities (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)		Total
Non-recurring valuations:
Financial assets:
Other real estate owned	$	—	$	—	$	5,708	$	5,708
Collateral dependent loans:
Commercial and industrial	$	—	$	—	$	4,697	$	4,697
Construction	—		—		1,817		1,817
Residential real estate:
1-4 family mortgage	—		—		190		190
Residential line of credit	—		—		1,195		1,195
Commercial real estate:
Owner occupied	—		—		928		928
Non-owner occupied	—		—		8,181		8,181
Consumer and other	—		—		333		333
Total collateral dependent loans	$	—	$	—	$	17,341	$	17,341

The balances and levels of the assets measured at fair value on a non-recurring basis at December 31, 2019 are presented in the following table:


At December 31, 2019	Quoted prices in active markets for identical assets (liabilities) (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)		Total
Non-recurring valuations:
Financial assets:
Other real estate owned	$	—	$	—	$	9,774	$	9,774
Impaired Loans (1):
Commercial and industrial	$	—	$	—	$	6,481	$	6,481

Residential real estate:
1-4 family mortgage	—		—		378		378
Residential line of credit	—		—		321		321
Commercial real estate:
Owner occupied	—		—		951		951
Non-owner occupied	—		—		2,560		2,560

Total	$	—	$	—	$	10,691	$	10,691

(1) Includes both impaired non-purchased loans and collateral-dependent PCI loans.

Information About Significant Unobservable Inputs (Level 3) Used in Valuation of Assets Measured at Fair Value on Nonrecurring Basis

The following table presents information as of September 30, 2020 about significant unobservable inputs (Level 3) used in the valuation of assets measured at fair value on a nonrecurring basis:

Financial instrument

Fair Value

Valuation technique

Significant
Unobservable inputs

Range of
inputs

Collateral dependent loans

17,341

Valuation of collateral

Discount for comparable sales

0%-30%

Other real estate owned

5,708

Appraised value of property less costs to sell

Discount for costs to sell

0%-15%

The following table presents information as of December 31, 2019 about significant unobservable inputs (Level 3) used in the valuation of assets measured at fair value on a nonrecurring basis: