Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

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

ollowing tables present summaries of the Corporation’s assets and liabilities measured at fair value on a recurring basis and reported on the consolidated balance sheets:



	September 30, 2013
	Level 1		Level 2		Level 3		Total
	(in thousands)
Mortgage loans held for sale	$	—	$	39,273	$	—	$	39,273
Available for sale investment securities:
Equity securities	43,728		—		—		43,728
U.S. Government securities	—		2,250		—		2,250
U.S. Government sponsored agency securities	—		835		—		835
State and municipal securities	—		293,513		—		293,513
Corporate debt securities	—		97,580		8,971		106,551
Collateralized mortgage obligations	—		1,082,977		—		1,082,977
Mortgage-backed securities	—		914,230		—		914,230
Auction rate securities	—		—		154,510		154,510
Total available for sale investments	43,728		2,391,385		163,481		2,598,594
Other assets	15,815		8,216		—		24,031
Total assets	$	59,543	$	2,438,874	$	163,481	$	2,661,898
Other liabilities	$	15,348	$	7,342	$	—	$	22,690



	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 investments	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

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

The following table presents the changes in the Corporation’s available for sale investment securities measured at fair value on a recurring basis using unobservable inputs (Level 3):



	Three months ended September 30, 2013
	Pooled Trust Preferred Securities			Single-issuer Trust Preferred Securities			ARCs
	(in thousands)
Balance at June 30, 2013	$	5,391		$	3,670		$	152,592
Sales	—			—			(25		)
Realized adjustment to fair value (1)	(97		)	—			—
Unrealized adjustment to fair value (2)	(103		)	108			1,983
Settlements - calls	—			—			(317		)
Discount accretion (3)	—			2			277
Balance at September 30, 2013	$	5,191		$	3,780		$	154,510

	Three months ended September 30, 2012
Balance at June 30, 2012	$	5,018		$	4,100		$	203,282
Sales	—			(956		)	—
Realized adjustment to fair value (1)	(19		)	19			—
Unrealized adjustment to fair value (2)	298			(55		)	6,809
Settlements - calls	(202		)	—			(50,370		)
Discount accretion (3)	46			2			341
Balance at September 30, 2012	$	5,141		$	3,110		$	160,062



	Nine months ended September 30, 2013
	Pooled Trust Preferred Securities			Single-issuer Trust Preferred Securities			ARCs
	(in thousands)
Balance at December 31, 2012	$	6,927		$	3,360		$	149,339
Sales	(4,987		)	—			(25		)
Realized adjustment to fair value (1)	1,604			—			—
Unrealized adjustment to fair value (2)	1,771			412			7,171
Settlements - calls	(124		)	—			(2,725		)
Discount accretion (3)	—			8			750
Balance at September 30, 2013	$	5,191		$	3,780		$	154,510

	Nine months ended September 30, 2012
Balance at December 31, 2011	$	5,109		$	4,180		$	225,211
Sales	—			(956		)	—
Realized adjustment to fair value (1)	(19		)	19			—
Unrealized adjustment to fair value (2)	612			111			(12,677		)
Settlements - calls	(605		)	(250		)	(54,880		)
Discount accretion (3)	44			6			2,408
Balance at September 30, 2012	$	5,141		$	3,110		$	160,062


(1)	Realized adjustments to fair value represent credit related other -than-temporary impairment charges and gains on sales of investment securities, both included as components of 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 sheets.


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

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis

Certain financial assets are not measured at fair value on an ongoing basis, but are subject to fair value measurement in certain circumstances, such as upon their acquisition or when there is evidence of impairment. The following table presents the Corporation’s financial assets measured at fair value on a nonrecurring basis and reported on the Corporation’s consolidated balance sheets:



	September 30, 2013
	Level 1		Level 2		Level 3		Total
	(in thousands)
Net loans	$	—	$	—	$	147,743	$	147,743
Other financial assets	—		—		60,801		60,801
Total assets	$	—	$	—	$	208,544	$	208,544



	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

Details of Book Value and Fair Value of Financial Instruments

As required by FASB ASC Section 825-10-50, the following table details the book values and estimated fair values of the Corporation’s financial instruments as of September 30, 2013 and December 31, 2012. In addition, a general description of the methods and assumptions used to estimate such fair values is also provided.

Fair values of financial instruments are significantly affected by the assumptions used, principally the timing of future cash flows and discount rates. Because assumptions are inherently subjective in nature, the estimated fair values cannot be substantiated by comparison to independent market quotes and, in many cases, the estimated fair values could not necessarily be realized in an immediate sale or settlement of the instrument. The aggregate fair value amounts presented do not necessarily represent management’s estimate of the underlying value of the Corporation.



	September 30, 2013				December 31, 2012
	Book Value		Estimated Fair Value		Book Value		Estimated Fair Value
	(in thousands)
FINANCIAL ASSETS
Cash and due from banks	$	262,938	$	262,938	$	256,300	$	256,300
Interest-bearing deposits with other banks	221,064		221,064		173,257		173,257
Loans held for sale (1)	39,273		39,273		67,899		67,899
Securities held to maturity	206		224		292		319
Securities available for sale (1)	2,686,443		2,686,443		2,793,725		2,793,725
Loans, net of unearned income (1)	12,780,899		12,730,181		12,146,971		12,129,971
Accrued interest receivable	44,715		44,715		45,786		45,786
Other financial assets (1)	144,367		144,367		201,069		201,069
FINANCIAL LIABILITIES
Demand and savings deposits	$	9,696,547	$	9,696,547	$	9,100,825	$	9,100,825
Time deposits	3,024,574		3,040,852		3,383,338		3,413,060
Short-term borrowings	1,198,577		1,198,577		868,399		868,399
Accrued interest payable	16,657		16,657		19,330		19,330
Other financial liabilities (1)	67,773		67,773		58,255		58,255
Federal Home Loan Bank advances and long-term debt	889,122		888,850		894,253		853,547


(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.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

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-Name Statement of Financial Accounting Standard (FAS)

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

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-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 9: http://www.xbrl.org/2003/role/presentationRef

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-Publisher FASB

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 11: http://www.xbrl.org/2003/role/presentationRef

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-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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