FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2014

Difference Between Fair Value and Principal Balance for Mortgage Loans Held for Sale Measured at Fair Valueir Value Inputs, Assets, Quantitative Information [Table Text Block]

The following table summarizes the difference between the fair value and the principal balance for mortgage loans held for sale measured at fair value as of September 30, 2014, December 31, 213 and September 31, 2013:


	September 30, 2014		December 31, 2013		September 30, 2013
	(Dollars in Thousands)
Aggregate Fair Value of Mortgage Loans held for sale	$	110,059	$	67,278	$	69,634
Aggregate Unpaid Principal Balance	$	105,882	$	65,522	$	67,406
Past due loans of 90 days or more	$	—	$	—	$	—
Nonaccrual loans	$	—	$	—	$	—

Carrying Amount and Estimated Fair Value of Financial Instruments

The carrying amount and estimated fair value of the Company’s financial instruments, not shown elsewhere in these financial statements, were as follows:


			Fair Value Measurements at September 30, 2014 Using:
	Carrying Amount		Level 1		Level 2		Level 3		Total
	(Dollars in Thousands)
Financial assets:
Cash and due from banks	$	69,421	$	69,421	$	—	$	—	$	69,421
Federal funds sold and interest-bearing accounts	$	40,165	$	40,165	$	—	$	—	$	40,165
Loans, net	$	2,778,026	$	—	$	—	$	2,773,291	$	2,773,291
FDIC loss-share receivable	$	38,233	$	—	$	—	$	21,397	$	21,397
Accrued interest receivable	$	17,171	$	17,171	$	—	$	—	$	17,171
Financial liabilities:
Deposits		3,373,119		—		3,374,055		—		3,374,055
Securities sold under agreements to repurchase		32,351		32,351		—		—		32,351
Other borrowings		147,409		—		147,409		—		147,409
Accrued interest payable		1,444		1,444		—		—		1,444
Subordinated deferrable interest debentures		65,084		—		46,214		—		46,214


			Fair Value Measurements at December 31, 2013 Using:
	Carrying Amount		Level 1		Level 2		Level 3		Total
	(Dollars in Thousands)
Financial assets:
Cash and due from banks	$	62,955	$	62,955	$	—	$	—	$	62,995
Federal funds sold and interest-bearing accounts	$	204,984	$	204,984	$	—	$	—	$	204,984
Loans, net	$	2,392,521	$	—	$	—	$	2,404,909	$	2,404,909
FDIC loss-share receivable	$	65,441	$	—	$	—	$	61,317	$	61,317
Accrued interest receivable	$	15,071	$	15,071	$	—	$	—	$	15,071
Financial liabilities:
Deposits		2,999,231		—		3,000,061		—		3,000,061
Securities sold under agreements to repurchase		83,516		83,516		—		—		83,516
Other borrowings		194,572		—		194,572		—		194,572
Accrued interest payable		1,431		1,431		—		—		1,431
Subordinated deferrable interest debentures		55,466		—		36,277		—		36,277


			Fair Value Measurements at September 30, 2013 Using:
	Carrying Amount		Level 1		Level 2		Level 3		Total
	(Dollars in Thousands)
Financial assets:
Cash and due from banks	$	53,516	$	53,516	$	—	$	—	$	53,516
Federal funds sold and interest-bearing accounts	$	73,899	$	73,899	$	—	$	—	$	73,899
Loans, net	$	1,939,498	$	—	$	—	$	1,912,634	$	1,912,634
FDIC loss-share receivable	$	81,763	$	—	$	—	$	76,346	$	76,346
Accrued interest receivable	$	13,030	$	13,030	$	—	$	—	$	13,030
Financial liabilities:
Deposits		2,443,421		—		2,444,244		—		2,444,244
Securities sold under agreements to repurchase		20,255		20,255		—		—		20,255
Accrued interest payable		831		831		—		—		831
Subordinated Deferrable Interest Debentures		42,269		—		23,331		—		23,331

Fair Value Measurements of Assets and Liabilities Measured on Recurring Basis

The following table presents the fair value measurements of assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall as of September 30, 2014, December 31, 2013 and September 30, 2013 (dollars in thousands):


	Fair Value Measurements on a Recurring Basis As of September 30, 2014
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. government agencies	$	14,460	$	—	$	14,460	$	—
State, county and municipal securities		137,635		—		137,635		—
Corporate debt securities		10,965		—		8,465		2,500
Mortgage-backed securities		366,449		10,273		356,176		—
Mortgage loans held for sale		110,059		—		110,059		—
IRLCs and forward contracts		2,295		—		2,295		—

Total recurring assets at fair value	$	641,863	$	10,273	$	629,090	$	2,500

Derivative financial instruments	$	807	$	—	$	807	$	—

Total recurring liabilities at fair value	$	807	$	—	$	807	$	—


	Fair Value Measurements on a Recurring Basis As of December 31, 2013
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. government agencies	$	13,926	$	—	$	13,926	$	—
State, county and municipal securities		112,754		—		112,754		—
Collateralized debt obligations		1,480		1,480		—		—
Corporate debt securities		10,325		—		8,325		2,000
Mortgage-backed securities		347,750		182,461		165,289		—
Mortgage loans held for sale		67,278		—		67,278		—
IRLCs and forward contracts		1,180		—		1,180		—

Total recurring assets at fair value	$	554,693	$	183,941	$	368,752	$	2,000

Derivative financial instruments	$	370	$	—	$	370	$	—

Total recurring liabilities at fair value	$	370	$	—	$	370	$	—


	Fair Value Measurements on a Recurring Basis As of September 30, 2013
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. government agencies	$	13,917	$	—	$	13,917	$	—
State, county and municipal securities		112,939		4,460		108,479		—
Corporate debt securities		9,738		—		7,738		2,000
Mortgage-backed securities		175,654		9,375		166,279		—
Mortgage loans held for sale		69,634		—		69,634		—
IRLCs and forward contracts		2,506		—		2,506		—

Total recurring assets at fair value	$	384,388	$	13,835	$	368,553	$	2,000

Derivative financial instruments	$	972	$	—	$	972	$	—

Total recurring liabilities at fair value	$	972	$	—	$	972	$	—

Valuation Methodologies for Instruments Measured at Fair Value on Nonrecurring Basis

The following table is a presentation of the valuation methodologies used for instruments measured at fair value on a nonrecurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy as of September 30, 2014, December 31, 2013 and September 30, 2013 (dollars in thousands):


	Fair Value Measurements on a Nonrecurring Basis As of September 30, 2014
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Impaired loans carried at fair value	$	35,834	$	—	$	—	$	35,834
Other real estate owned		35,320		—		—		35,320
Purchased, non-covered other real estate owned		13,660		—		—		13,660
Covered other real estate owned		28,883		—		—		28,883

Total nonrecurring assets at fair value	$	113,697	$	—	$	—	$	113,697


	Fair Value Measurements on a Nonrecurring Basis As of December 31, 2013
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Impaired loans carried at fair value	$	42,546	$	—	$	—	$	42,546
Other real estate owned		33,351		—		—		33,351
Purchased, non-covered other real estate owned		4,276		—		—		4,276
Covered other real estate owned		45,893		—		—		45,893

Total nonrecurring assets at fair value	$	126,066	$	—	$	—	$	126,066


	Fair Value Measurements on a Nonrecurring Basis As of September 30, 2013
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Impaired loans carried at fair value	$	43,564	$	—	$	—	$	43,564
Other real estate owned		39,978		—		—		39,978
Covered other real estate owned		52,552		—		—		52,552

Total nonrecurring assets at fair value	$	136,094	$	—	$	—	$	136,094

Summary of Significant Unobservable Inputs Used in Fair Value Measurement of Level 3 Assets and Liabilities

The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets and liabilities as of September 30, 2014.


Measurements	Fair Value at September 30, 2014		Valuation Technique	Unobservable Inputs	Range
	(Dollars in Thousands)
Nonrecurring:
Impaired loans	$	35,834	Third party appraisals and discounted cash flows	Collateral discounts and discount rates	4.00% - 90.00%
Other real estate owned	$	35,320	Third party appraisals	Collateral discounts and estimated costs to sell	10.00% - 90.00%
Purchased non-covered other real estate owned	$	13,660	Third party appraisals	Collateral discounts and estimated costs to sell	22.00% - 94.00%
Covered real estate owned	$	28,883	Third party appraisals	Collateral discounts and estimated costs to sell	10.00% - 90.00%
Recurring:
Investment securities available for sale	$	2,500	Discounted par values	Credit quality of underlying issuer	0.00%

The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets and liabilities as of December 31, 2013.


Measurements	Fair Value at December 31, 2013		Valuation Technique	Unobservable Inputs	Range
	(Dollars in Thousands)
Nonrecurring:
Impaired loans	$	42,546	Third party appraisals and discounted cash flows	Collateral discounts and discount rates	4.00% - 75.00%
Other real estate owned	$	33,351	Third party appraisals	Collateral discounts and estimated costs to sell	10.00% - 74.00%
Purchased, non-covered loans	$	448,753	Third party appraisals and discounted cash flows	Collateral discounts and discount rates	1.00% - 40.00%
Purchased non-covered other real estate owned	$	4,276	Third party appraisals	Collateral discounts and estimated costs to sell	15.00% - 63.00%
Covered loans	$	390,237	Third party appraisals and discounted cash flows	Collateral discounts Discount rate	1.75% - 75.00%
Covered real estate owned	$	45,893	Third party appraisals	Collateral discounts and estimated costs to sell	10.00% - 86.00%
Recurring:
Investment securities available for sale	$	2,000	Discounted par values	Credit quality of underlying issuer	0.00%

- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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- Definition

Tabular disclosure of the application of the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected, provide the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (b) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (c) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) for loans and other receivables held as assets, the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk; (c) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk, the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk; and (3) certain other disclosures as required or determined to be provided.

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