Fair Value (Tables)

9 Months Ended

Sep. 30, 2015

Financial assets and liabilities measured at fair value recurring basis

The following tables summarize financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2015 and December 31, 2014, segregated by the level of valuation inputs within the fair value hierarchy utilized to measure fair value ($ in thousands). There were no transfers between fair value levels for the nine months ended September 30, 2015 and the year ended December 31, 2014.

	September 30, 2015
	Total		Level 1		Level 2		Level 3
U.S. Government agency obligations	$	94,298	$	-	$	94,298	$	-
Obligations of states and political subdivisions		147,794		-		147,794		-
Mortgage-backed securities		2,114,073		-		2,114,073		-
Asset-backed securities and structured financial products		26,657		-		26,657		-
Securities available for sale		2,382,822		-		2,382,822		-
Loans held for sale		173,679		-		173,679		-
Mortgage servicing rights		69,809		-		-		69,809
Other assets - derivatives		7,846		1,793		3,347		2,706
Other liabilities - derivatives		7,305		301		7,004		-

	December 31, 2014
	Total		Level 1		Level 2		Level 3
U.S. Treasury securities	$	100	$	-	$	100	$	-
U.S. Government agency obligations		112,474		-		112,474		-
Obligations of states and political subdivisions		162,258		-		162,258		-
Mortgage-backed securities		2,068,035		-		2,068,035		-
Asset-backed securities and structured financial products		31,700		-		31,700		-
Securities available for sale		2,374,567		-		2,374,567		-
Loans held for sale		132,196		-		132,196		-
Mortgage servicing rights		64,358		-		-		64,358
Other assets - derivatives		5,527		1,181		3,047		1,299
Other liabilities - derivatives		4,338		490		3,848		-

Changes in level 3 assets measured at fair value on a recurring basis

The changes in Level 3 assets measured at fair value on a recurring basis for the nine months ended September 30, 2015 and 2014 are summarized as follows ($ in thousands):

	MSR			Other Assets - Derivatives
Balance, January 1, 2015	$	64,358		$	1,299
Total net (loss) gain included in Mortgage banking, net (1)		(7,869	)		6,193
Additions		13,320			-
Sales		-			(4,786	)
Balance, September 30, 2015	$	69,809		$	2,706

The amount of total losses for the period included in earnings that are attributable to the change in unrealized gains or losses still held at September 30, 2015	$	(433	)	$	(169	)

Balance, January 1, 2014	$	67,834		$	126
Total net (loss) gain included in Mortgage banking, net (1)		(9,628	)		3,508
Additions		8,884			-
Sales		-			(2,294	)
Balance, September 30, 2014	$	67,090		$	1,340

The amount of total (losses) gains for the period included in earnings that are attributable to the change in unrealized gains or losses still held at September 30, 2014	$	(3,060	)	$	807

(1)	Total net (loss) gain included in Mortgage banking, net relating to MSR includes changes in fair value due to market changes and due to run-off.

Carrying amounts and estimated fair values of financial instruments

The carrying amounts and estimated fair values of financial instruments at September 30, 2015 and December 31, 2014, are as follows ($ in thousands):

	September 30, 2015				December 31, 2014
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial Assets:
Level 2 Inputs:
Cash and short-term investments	$	220,052	$	220,052	$	317,858	$	317,858
Securities held to maturity		1,178,440		1,203,068		1,170,685		1,182,846
Level 3 Inputs:
Net LHFI		6,726,036		6,835,977		6,379,853		6,453,618
Net acquired loans		406,988		406,988		537,350		537,350
FDIC indemnification asset		1,749		1,749		6,997		6,997

Financial Liabilities:
Level 2 Inputs:
Deposits		9,412,404		9,416,869		9,698,358		9,702,864
Short-term liabilities		1,244,049		1,244,049		868,620		868,620
Long-term FHLB advances		1,173		1,179		1,253		1,263
Subordinated notes		49,961		52,027		49,936		53,504
Junior subordinated debt securities		61,856		50,759		61,856		46,392

Fair value and the contractual principal outstanding of the LHFS

The following table provides information about the fair value and the contractual principal outstanding of the LHFS accounted for under the fair value option as of September 30, 2015 and December 31, 2014 ($ in thousands):

	September 30, 2015		December 31, 2014
Fair value of LHFS	$	146,621	$	91,182
LHFS contractual principal outstanding		141,366		88,106
Fair value less unpaid principal	$	5,255	$	3,076