Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2012

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

Following is a summary of the Corporation’s assets and liabilities measured at fair value on a recurring basis and reported on the consolidated balance sheets at December 31:



	2012
	Level 1		Level 2		Level 3		Total
	(in thousands)
Mortgage loans held for sale	$	—	$	67,899	$	—	$	67,899
Available for sale investment securities:
Equity securities	50,873		—		—		50,873
U.S. Government securities	—		325		—		325
U.S. Government sponsored agency securities	—		2,397		—		2,397
State and municipal securities	—		315,519		—		315,519
Corporate debt securities	—		102,555		10,287		112,842
Collateralized mortgage obligations	—		1,211,119		—		1,211,119
Mortgage-backed securities	—		879,621		—		879,621
Auction rate securities	—		—		149,339		149,339
Total available for sale investment securities	50,873		2,511,536		159,626		2,722,035
Other assets	15,259		14,710		—		29,969
Total assets	$	66,132	$	2,594,145	$	159,626	$	2,819,903
Other liabilities	$	15,524	$	8,161	$	—	$	23,685

	2011
	Level 1		Level 2		Level 3		Total
	(in thousands)
Mortgage loans held for sale	$	—	$	47,009	$	—	$	47,009
Available for sale investment securities:
Equity securities	34,586		—		—		34,586
U.S. Government securities	—		334		—		334
U.S. Government sponsored agency securities	—		4,073		—		4,073
State and municipal securities	—		322,018		—		322,018
Corporate debt securities	—		114,017		9,289		123,306
Collateralized mortgage obligations	—		1,001,209		—		1,001,209
Mortgage-backed securities	—		880,097		—		880,097
Auction rate securities	—		—		225,211		225,211
Total available for sale investment securities	34,586		2,321,748		234,500		2,590,834
Other assets	13,130		3,901		—		17,031
Total assets	$	47,716	$	2,372,658	$	234,500	$	2,654,874
Other liabilities	$	13,130	$	2,734	$	—	$	15,864

Schedule of Changes in Assets and Liabilities Measured at Fair Value on a Recurring Basis using Level 3 Inputs

The following tables present the changes in the Corporation’s available for sale investment securities measured at fair value on a recurring basis using unobservable inputs (Level 3) for the years ended December 31:



	2012
	Pooled Trust Preferred Securities			Single-issuer Trust Preferred Securities			Auction Rate Securities (ARCs)
	(in thousands)
Balance, December 31, 2011	$	5,109		$	4,180		$	225,211
Realized adjustments to fair value (1)	(19		)	19			(434		)
Unrealized adjustments to fair value (2)	2,466			359			(8,612		)
Sales	—			(956		)	—
Settlements - calls	(673		)	(250		)	(69,068		)
(Premium amortization) discount accretion (3)	44			8			2,242
Balance, December 31, 2012	$	6,927		$	3,360		$	149,339



	2011
	Pooled Trust Preferred Securities			Single-issuer Trust Preferred Securities			Auction Rate Securities (ARCs)
	(in thousands)
Balance, December 31, 2010	$	4,528		$	8,583		$	260,679
Transfer from Level 3 to Level 2 (4)	—			(800		)	—
Realized adjustments to fair value (1)	(1,406		)	—			(292		)
Unrealized adjustments to fair value (2)	2,465			28			(4,383		)
Sales (5)	—			—			—
Settlements - maturities	—			(1,650		)
Settlements - calls	(476		)	(1,980		)	(34,844		)
(Premium amortization) discount accretion (3)	(2		)	(1		)	4,051
Balance, December 31, 2011	$	5,109		$	4,180		$	225,211


(1)	For pooled trust preferred securities and ARCs, realized adjustments to fair value represent credit related other-than-temporary impairment charges that were recorded as a reduction to investment securities gains on the consolidated statements of income.


(2)	Pooled trust preferred securities, single-issuer trust preferred securities and ARCs are classified as available for sale investment securities; as such, the unrealized adjustment to fair value was recorded as an unrealized holding gain (loss) and included as a component of available for sale investment securities on the consolidated balance sheet.


(3)	Included as a component of net interest income on the consolidated statements of income.

(4)

During the year ended December 31, 2011, one single-issuer trust preferred security with a fair value of $800,000 as of December 31, 2011 was reclassified as a Level 2 asset. As of December 31, 2011, the fair value of this security was measured by a third-party pricing service using both quoted prices for similar assets and model-based valuation techniques that derived fair value based on market-corroborated data, such as instruments with similar prepayment speeds and default interest rates. As of December 31, 2010, the fair value of this security was determined based on quotes provided by third-party brokers who determined its fair value based predominantly on an internal valuation model.


(5)	During the year ended December 31, 2011, the Corporation sold one pooled trust preferred security with a par value of $6.4 million and a book value of zero for no gain or loss. This security had a book value of zero as a result of prior year other-than-temporary impairment charges.

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis

The following tables present the Corporation’s financial assets measured at fair value on a nonrecurring basis and reported on the Corporation’s consolidated balance sheets at December 31:



	2012
	Level 1		Level 2		Level 3		Total
	(in thousands)
Net loans	$	—	$	—	$	191,165	$	191,165
Other financial assets	—		—		62,203		62,203
Total assets	$	—	$	—	$	253,368	$	253,368

	2011
	Level 1		Level 2		Level 3		Total
	(in thousands)
Net loans	—		—		216,812		216,812
Other financial assets	—		—		63,919		63,919
Total assets	$	—	$	—	$	280,731	$	280,731

Details of Book Value and Fair Value of Financial Instruments



	2012				2011
	Book Value		Estimated Fair Value		Book Value		Estimated Fair Value
FINANCIAL ASSETS	(in thousands)
Cash and due from banks	$	256,300	$	256,300	$	292,598	$	292,598
Interest-bearing deposits with other banks	173,257		173,257		175,336		175,336
Loans held for sale (1)	67,899		67,899		47,009		47,009
Securities held to maturity	292		319		6,669		6,699
Securities available for sale (1)	2,793,725		2,793,725		2,673,298		2,673,298
Loans, net of unearned income (1)	12,144,604		12,127,309		11,968,970		11,992,586
Accrued interest receivable	45,786		45,786		51,098		51,098
Other financial assets (1)	198,504		198,504		315,952		315,952
FINANCIAL LIABILITIES
Demand and savings deposits	$	9,089,753	$	9,089,753	$	8,511,789	$	8,511,789
Time deposits	3,383,338		3,413,060		4,013,950		4,056,247
Short-term borrowings	868,399		868,399		597,033		597,033
Accrued interest payable	19,330		19,330		25,686		25,686
Other financial liabilities (1)	65,024		65,024		69,816		69,816
FHLB advances and long-term debt	894,253		853,547		1,040,149		982,010


(1)	Description of fair value determinations for these financial instruments, or certain financial instruments within these categories, measured at fair value on the Corporation’s consolidated balance sheets, are disclosed above.

Schedule of Financial Instruments Classified as Predominantly Short-Term Instruments

The following instruments are predominantly short-term:



Assets		Liabilities
Cash and due from banks		Demand and savings deposits
Interest bearing deposits		Short-term borrowings
Accrued interest receivable		Accrued interest payable

- Definition

Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

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- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

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