Fair Value (Tables)

9 Months Ended

Sep. 30, 2017

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, 2017 and December 31, 2016, 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, 2017 and the year ended December 31, 2016.

	September 30, 2017
	Total		Level 1			Level 2		Level 3
U.S. Government agency obligations	$	49,994	$	—		$	49,994	$	—
Obligations of states and political subdivisions		89,144		—			89,144		—
Mortgage-backed securities		2,229,951		—			2,229,951		—
Securities available for sale		2,369,089		—			2,369,089		—
Loans held for sale		204,157		—			204,157		—
Mortgage servicing rights		81,477		—			—		81,477
Other assets - derivatives		791		(2,012	)		1,797		1,006
Other liabilities - derivatives		2,203		1,063			1,140		—

	December 31, 2016
	Total		Level 1			Level 2			Level 3
U.S. Government agency obligations	$	56,039	$	—		$	56,039		$	—
Obligations of states and political subdivisions		115,373		—			115,373			—
Mortgage-backed securities		2,185,270		—			2,185,270			—
Securities available for sale		2,356,682		—			2,356,682			—
Loans held for sale		175,927		—			175,927			—
Mortgage servicing rights		80,239		—			—			80,239
Other assets - derivatives		2,518		(524	)		2,041			1,001
Other liabilities - derivatives		412		1,174			(762	)		—

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, 2017 and 2016 are summarized as follows ($ in thousands):

	MSR			Other Assets - Derivatives
Balance, January 1, 2017	$	80,239		$	1,001
Total net (loss) gain included in Mortgage banking, net (1)		(10,392	)		3,436
Additions		11,630			—
Sales		—			(3,431	)
Balance, September 30, 2017	$	81,477		$	1,006

The amount of total gains (losses) for the period included in earnings that are attributable to the change in unrealized gains or losses still held at September 30, 2017	$	(2,218	)	$	(1,483	)

Balance, January 1, 2016	$	74,007		$	1,113
Total net (loss) gain included in Mortgage banking, net (1)		(20,885	)		9,486
Additions		12,392			—
Sales		—			(7,852	)
Balance, September 30, 2016	$	65,514		$	2,747

The amount of total gains (losses) for the period included in earnings that are attributable to the change in unrealized gains or losses still held at September 30, 2016	$	(13,518	)	$	904

(1)	Total net (loss) gain included in Mortgage banking, net relating to the 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, 2017 and December 31, 2016, are as follows ($ in thousands):

	September 30, 2017				December 31, 2016
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial Assets:
Level 2 Inputs:
Cash and short-term investments	$	353,338	$	353,338	$	328,206	$	328,206
Securities held to maturity		1,102,283		1,104,032		1,158,643		1,157,046
Level 3 Inputs:
Net LHFI		8,327,009		8,404,146		7,779,948		7,825,009
Net acquired loans		277,989		277,989		260,850		260,850

Financial Liabilities:
Level 2 Inputs:
Deposits		10,231,742		10,234,070		10,056,012		10,059,794
Short-term liabilities		1,867,762		1,867,762		1,309,595		1,309,595
Long-term FHLB advances		962		962		251,049		251,050
Junior subordinated debt securities		61,856		44,536		61,856		41,057

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, 2017 and December 31, 2016 ($ in thousands):

	September 30, 2017		December 31, 2016
Fair value of LHFS	$	156,107	$	132,002
LHFS contractual principal outstanding		152,251		132,047
Fair value less unpaid principal	$	3,856	$	(45	)