Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2019

Assets and liabilities measured at fair value on a recurring basis

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of the dates presented:



	Level 1		Level 2		Level 3		Totals
March 31, 2019
Financial assets:
Securities available for sale:
Obligations of other U.S. Government agencies and corporations	$	—	$	2,525	$	—	$	2,525
Obligations of states and political subdivisions	—		183,762		—		183,762
Residential mortgage-backed securities:
Government agency mortgage backed securities	—		622,066		—		622,066
Government agency collateralized mortgage obligations	—		319,447		—		319,447
Commercial mortgage-backed securities:
Government agency mortgage backed securities	—		21,998		—		21,998
Government agency collateralized mortgage obligations	—		46,330		—		46,330
Trust preferred securities	—		—		10,246		10,246
Other debt securities	—		48,979		—		48,979
Total securities available for sale	—		1,245,107		10,246		1,255,353
Derivative instruments:
Interest rate contracts	—		2,391		—		2,391
Interest rate lock commitments	—		4,964		—		4,964
Forward commitments	—		31		—		31
Total derivative instruments	—		7,386		—		7,386
Mortgage loans held for sale in loans held for sale	—		195,807		—		195,807
Total financial assets	$	—	$	1,448,300	$	10,246	$	1,458,546
Financial liabilities:
Derivative instruments:
Interest rate swaps	$	—	$	3,274	$	—	$	3,274
Interest rate contracts	—		2,391		—		2,391
Interest rate lock commitments	—		1		—		1
Forward commitments	—		2,692		—		2,692
Total derivative instruments	—		8,358		—		8,358
Total financial liabilities	$	—	$	8,358	$	—	$	8,358



	Level 1		Level 2		Level 3		Totals
December 31, 2018
Financial assets:
Securities available for sale:
Obligations of other U.S. Government agencies and corporations	$	—	$	2,511	$	—	$	2,511
Obligations of states and political subdivisions	—		203,269		—		203,269
Residential mortgage-backed securities:
Government agency mortgage backed securities	—		613,283		—		613,283
Government agency collateralized mortgage obligations	—		326,989		—		326,989
Commercial mortgage-backed securities:
Government agency mortgage backed securities	—		21,830		—		21,830
Government agency collateralized mortgage obligations	—		28,335		—		28,335
Trust preferred securities	—		—		10,633		10,633
Other debt securities	—		43,927		—		43,927
Total securities available for sale	—		1,240,144		10,633		1,250,777
Derivative instruments:
Interest rate contracts	—		2,779		—		2,779
Interest rate lock commitments	—		3,740		—		3,740
Total derivative instruments	—		6,519		—		6,519
Mortgage loans held for sale	—		219,848		—		219,848
Total financial assets	$	—	$	1,466,511	$	10,633	$	1,477,144
Financial liabilities:
Derivative instruments:
Interest rate swaps	$	—	$	2,046	$	—	$	2,046
Interest rate contracts	—		2,779		—		2,779
Forward commitments	—		3,563		—		3,563
Total derivative instruments	—		8,388		—		8,388
Total financial liabilities	$	—	$	8,388	$	—	$	8,388

Reconciliation for assets and liabilities measured at fair value on a recurring basis

The following tables provide a reconciliation for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs, or Level 3 inputs, as of the dates presented:



Three Months Ended March 31, 2019	Trust preferred securities
Balance at January 1, 2019	$	10,633
Accretion included in net income	9
Unrealized losses included in other comprehensive income	(287		)
Purchases	—
Sales	—
Issues	—
Settlements	(109		)
Transfers into Level 3	—
Transfers out of Level 3	—
Balance at March 31, 2019	$	10,246



Three Months Ended March 31, 2018	Trust preferred securities
Balance at January 1, 2018	$	9,388
Accretion included in net income	9
Unrealized gains included in other comprehensive income	669
Purchases	—
Sales	—
Issues	—
Settlements	(21		)
Transfers into Level 3	—
Transfers out of Level 3	—
Balance at March 31, 2018	$	10,045

Significant unobservable inputs (Level 3) used in valuation of assets and liabilities measured at fair value on recurring basis

The following table presents information as of March 31, 2019 about significant unobservable inputs (Level 3) used in the valuation of assets and liabilities measured at fair value on a recurring basis:



Financial instrument	Fair Value		Valuation Technique	Significant Unobservable Inputs	Range of Inputs
Trust preferred securities	$	10,246	Discounted cash flows	Default rate	0-100%

Assets measured at fair value on a nonrecurring basis

The following table provides the fair value measurement for assets measured at fair value on a nonrecurring basis that were still held on the Consolidated Balance Sheets as of the dates presented and the level within the fair value hierarchy each is classified:



March 31, 2019	Level 1		Level 2		Level 3		Totals
Impaired loans	$	—	$	—	$	8,552	$	8,552
OREO	—		—		2,764		2,764
Total	$	—	$	—	$	11,316	$	11,316



December 31, 2018	Level 1		Level 2		Level 3		Totals
Impaired loans	$	—	$	—	$	21,686	$	21,686
OREO	—		—		4,319		4,319
Total	$	—	$	—	$	26,005	$	26,005

OREO measured at fair value on a nonrecurring basis

The following table presents OREO measured at fair value on a nonrecurring basis that was still held in the Consolidated Balance Sheets as of the dates presented:



	March 31, 2019			December 31, 2018
Carrying amount prior to remeasurement	$	3,491		$	5,258
Impairment recognized in results of operations	(727		)	(939		)
Fair value	$	2,764		$	4,319

Significant unobservable inputs (Level 3) used in valuation of assets and liabilities measured at fair value on non recurring basis



Financial instrument	Fair Value		Valuation Technique	Significant Unobservable Inputs	Range of Inputs
Impaired loans	$	8,552	Appraised value of collateral less estimated costs to sell	Estimated costs to sell	4-10%
OREO	2,764		Appraised value of property less estimated costs to sell	Estimated costs to sell	4-10%

Summarizes differences between fair value and principal balance for mortgage loans held for sale measure at fair value

The following table summarizes the differences between the fair value and the principal balance for mortgage loans held for sale measured at fair value as of March 31, 2019:



	Aggregate Fair Value		Aggregate Unpaid Principal Balance		Difference
Mortgage loans held for sale measured at fair value	$	195,807	$	188,188	$	7,619
Past due loans of 90 days or more	—		—		—
Nonaccrual loans	—		—		—

Assets and liabilities not measured and reported at fair value on a recurring basis or nonrecurring basis

The carrying amounts and estimated fair values of the Company’s financial instruments, including those assets and liabilities that are not measured and reported at fair value on a recurring basis or nonrecurring basis, were as follows as of the dates presented:



			Fair Value
As of March 31, 2019	Carrying Value		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	562,066	$	562,066	$	—	$	—	$	562,066
Securities available for sale	1,255,353		—		1,245,107		10,246		1,255,353
Loans held for sale	318,563		—		195,807		122,756		318,563
Loans, net	9,038,458		—		—		8,801,277		8,801,277
Mortgage servicing rights	48,973		—		—		55,334		55,334
Derivative instruments	7,386		—		7,386		—		7,386
Financial liabilities
Deposits	$	10,268,912	$	7,884,578	$	2,366,030	$	—	$	10,250,608
Short-term borrowings	87,590		87,590		—		—		87,590
Other long-term borrowings	35		35		—		—		35
Federal Home Loan Bank advances	6,492		—		6,622		—		6,622
Junior subordinated debentures	109,781		—		104,300		—		104,300
Subordinated notes	146,962		—		147,175		—		147,175
Derivative instruments	8,358		—		8,358		—		8,358



			Fair Value
As of December 31, 2018	Carrying Value		Level 1		Level 2		Level 3		Total
Financial assets
Cash and cash equivalents	$	569,111	$	569,111	$	—	$	—	$	569,111
Securities available for sale	1,250,777		—		1,240,144		10,633		1,250,777
Loans held for sale	411,427		—		219,848		191,579		411,427
Loans, net	9,034,103		—		—		8,818,039		8,818,039
Mortgage servicing rights	48,230		—		—		61,111		61,111
Derivative instruments	6,519		—		6,519		—		6,519
Financial liabilities
Deposits	$	10,128,557	$	7,765,773	$	2,337,334	$	—	$	10,103,107
Short-term borrowings	387,706		387,706		—		—		387,706
Other long-term borrowings	53		53		—		—		53
Federal Home Loan Bank advances	6,690		—		6,751		—		6,751
Junior subordinated debentures	109,636		—		109,766		—		109,766
Subordinated notes	147,239		—		148,875		—		148,875
Derivative instruments	8,388		—		8,388		—		8,388

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details