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Fair Value Measurement (Tables)

6 Months Ended

Jun. 30, 2022

Schedule of Fair Value of Assets and Liabilities Measured on Recurring and Nonrecurring Basis

The fair value amounts presented in the table below are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position. The following tables set forth Wesbanco’s financial assets and liabilities that were accounted for at fair value on a recurring and nonrecurring basis by level within the fair value hierarchy as of June 30, 2022 and December 31, 2021:


			June 30, 2022
			Fair Value Measurements Using:
	June 30,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(unaudited, in thousands)	2022		(level 1)		(level 2)		(level 3)
Recurring fair value measurements
Equity securities	$	11,413	$	11,413	$	—	$	—
Available-for-sale debt securities
U.S. Government sponsored entities and agencies		248,929		—		248,929		—
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		2,089,287		—		2,089,287		—
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		431,828		—		431,828		—
Obligations of states and political subdivisions		99,310		—		98,084		1,226
Corporate debt securities		15,297		—		15,297		—
Total available-for-sale debt securities	$	2,884,651	$	—	$	2,883,425	$	1,226
Loans held for sale		17,560		—		17,560		—
Other assets - interest rate swaps		46,815		—		46,815		—
Total assets recurring fair value measurements	$	2,960,439	$	11,413	$	2,947,800	$	1,226
Other liabilities - interest rate swaps	$	45,734	$	—	$	45,734	$	—
Total liabilities recurring fair value measurements	$	45,734	$	—	$	45,734	$	—
Nonrecurring fair value measurements
Collateral dependent loans	$	23,725	$	—	$	—	$	23,725
Other real estate owned and repossessed assets		31		—		—		31
Total nonrecurring fair value measurements	$	23,756	$	—	$	—	$	23,756


			December 31, 2021
			Fair Value Measurements Using:
	December 31,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(in thousands)	2021		(level 1)		(level 2)		(level 3)
Recurring fair value measurements
Equity securities	$	13,466	$	13,466	$	—	$	—
Available-for-sale debt securities
U.S. Government sponsored entities and agencies		236,978		—		236,978		—
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		2,285,213		—		2,285,213		—
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		367,493		—		367,493		—
Obligations of states and political subdivisions		106,340		—		104,847		1,493
Corporate debt securities		17,438		—		17,438		—
Total available-for-sale debt securities	$	3,013,462	$	—	$	3,011,969	$	1,493
Loans held for sale		25,277		—		25,277		—
Other assets - interest rate swaps		24,867		—		24,867		—
Total assets recurring fair value measurements	$	3,077,072	$	13,466	$	3,062,113	$	1,493
Other liabilities - interest rate swaps	$	26,388	$	—	$	26,388	$	—
Total liabilities recurring fair value measurements	$	26,388	$	—	$	26,388	$	—
Nonrecurring fair value measurements
Collateral dependent loans	$	13,558	$	—	$	—	$	13,558
Other real estate owned and repossessed assets		—		—		—		—
Total nonrecurring fair value measurements	$	13,558	$	—	$	—	$	13,558

Schedule of Assets Measured at Fair Value on Nonrecurring Basis

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which Wesbanco has utilized level 3 inputs to determine fair value:


	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range (Weighted
(unaudited, in thousands)	Estimate		Techniques	Input	Average)
June 30, 2022
Collateral dependent loans	$	23,725	Appraisal of collateral (1)	Appraisal adjustments (2)	(30.0%)/(30.0%)
				Liquidation expenses (2)	(5.6%) to (8.0%)/(6.7%)
Other real estate owned and repossessed assets	$	31	Appraisal of collateral (1), (3)
December 31, 2021
Collateral dependent loans	$	13,558	Appraisal of collateral (1)	Appraisal adjustments (2)	(0.0%)/(0.0%)
				Liquidation expenses (2)	(8.0%)/(8.0%)

(1)

Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various level 3 inputs, which are not identifiable.

(2)

Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of appraisal adjustments and liquidation expense are presented as a percent of the appraisal.

(3)

Includes estimated liquidation expenses and numerous dissimilar qualitative adjustments by management, which are not identifiable.

Estimates Fair Values of Financial Instruments

The estimated fair values of Wesbanco’s financial instruments are summarized below:


					Fair Value Measurements at
					June 30, 2022
	Carrying		Fair Value		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(unaudited, in thousands)	Amount		Estimate		(level 1)		(level 2)		(level 3)
Financial Assets
Cash and due from banks	$	450,009	$	450,009	$	450,009	$	—	$	—
Equity securities		11,413		11,413		11,413		—		—
Available-for-sale debt securities		2,884,651		2,884,651		—		2,883,425		1,226
Net held-to-maturity debt securities		1,281,030		1,153,594		—		1,153,244		350
Net loans		10,091,286		9,236,728		—		—		9,236,728
Loans held for sale		17,560		17,560		—		17,560		—
Other assets - interest rate swaps		46,815		46,815		—		46,815		—
Accrued interest receivable		61,918		61,918		61,918		—		—

Financial Liabilities
Deposits		13,569,302		13,575,715		12,463,997		1,111,718		—
Federal Home Loan Bank borrowings		122,650		121,881		—		121,881		—
Other borrowings		147,964		132,138		132,138		—		—
Subordinated debt and junior subordinated debt		280,910		273,599		—		273,599		—
Other liabilities - interest rate swaps		45,734		45,734		—		45,734		—
Accrued interest payable		2,815		2,815		2,815		—		—


					Fair Value Measurements at
					December 31, 2021
	Carrying		Fair Value		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(in thousands)	Amount		Estimate		(level 1)		(level 2)		(level 3)
Financial Assets
Cash and due from banks	$	1,251,358	$	1,251,358	$	1,251,358	$	—	$	—
Equity securities		13,466		13,466		13,466		—		—
Available-for-sale debt securities		3,013,462		3,013,462		—		3,011,969		1,493
Net held-to-maturity debt securities		1,004,555		1,028,452		—		1,028,047		405
Net loans		9,611,856		9,385,917		—		—		9,385,917
Loans held for sale		25,277		25,277		—		25,277		—
Other assets - interest rate swaps		24,867		24,867		—		24,867		—
Accrued interest receivable		60,844		60,844		60,844		—		—

Financial Liabilities
Deposits		13,565,863		13,575,477		12,273,211		1,302,266		—
Federal Home Loan Bank borrowings		183,920		185,684		—		185,684		—
Other borrowings		141,893		134,288		134,288		—		—
Subordinated debt and junior subordinated debt		132,860		109,186		—		109,186		—
Other liabilities - interest rate swaps		26,388		26,388		—		26,388		—
Accrued interest payable		1,901		1,901		1,901		—		—

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details