Fair Value Measurement (Tables)

3 Months Ended

Mar. 31, 2018

Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables present our assets and liabilities that are measured at fair value on a recurring basis by fair value hierarchy level at March 31, 2018 and December 31, 2017. There were no transfers between Level 1 and Level 2 for items measured at fair value on a recurring basis during the periods presented.



	March 31, 2018
(dollars in thousands)	Level 1		Level 2		Level 3		Total
ASSETS
Debt securities available-for-sale:
U.S. Treasury securities	$	—	$	14,661	$	—	$	14,661
Obligations of U.S. government corporations and agencies	—		160,589		—		160,589
Collateralized mortgage obligations of U.S. government corporations and agencies	—		102,582		—		102,582
Residential mortgage-backed securities of U.S. government corporations and agencies	—		30,683		—		30,683
Commercial mortgage-backed securities of U.S. government corporations and agencies	—		248,798		—		248,798
Obligations of states and political subdivisions	—		125,141		—		125,141
Total Debt Securities Available-for-Sale	—		682,454		—		682,454
Marketable equity securities⁽¹⁾	—		5,196		—		5,196
Total Securities	—		687,650		—		687,650
Trading securities held in a Rabbi Trust	5,048		—		—		5,048
Derivative financial assets:
Interest rate swaps	—		4,669		—		4,669
Interest rate lock commitments	—		271		—		271
Total Assets	$	5,048	$	692,590	$	—	$	697,638
LIABILITIES
Derivative financial liabilities:
Interest rate swaps	$	—	$	4,765	$	—	$	4,765
Forward sale contracts	—		24		—		24
Total Liabilities	$	—	$	4,789	$	—	$	4,789

⁽¹⁾ASU 2016-01 was adopted January 1, 2018, resulting in separate classification of our marketable equity securities previously included in available-for-sale securities.



	December 31, 2017
(dollars in thousands)	Level 1		Level 2		Level 3		Total
ASSETS
Debt securities available-for-sale:
U.S. Treasury securities	$	—	$	19,789	$	—	$	19,789
Obligations of U.S. government corporations and agencies	—		162,193		—		162,193
Collateralized mortgage obligations of U.S. government corporations and agencies	—		108,688		—		108,688
Residential mortgage-backed securities of U.S. government corporations and agencies	—		32,854		—		32,854
Commercial mortgage-backed securities of U.S. government corporations and agencies	—		242,221		—		242,221
Obligations of states and political subdivisions	—		127,402		—		127,402
Marketable equity securities	—		5,144		—		5,144
Total Debt Securities Available-for-Sale	—		698,291		—		698,291
Total Securities	—		698,291		—		698,291
Trading securities held in a Rabbi Trust	5,080		—		—		5,080
Derivative financial assets:
Interest rate swaps	—		3,074		—		3,074
Interest rate lock commitments	—		226		—		226
Total Assets	$	5,080	$	701,591	$	—	$	706,671
LIABILITIES
Derivative financial liabilities:
Interest rate swaps	$	—	$	3,055	$	—	$	3,055
Forward sale contracts	—		5		—		5
Total Liabilities	$	—	$	3,060	$	—	$	3,060

Assets Measured at Estimated Fair Value on Nonrecurring Basis by Fair Value Hierarchy

The following table presents our assets that are measured at fair value on a nonrecurring basis by the fair value hierarchy level as of the dates presented:



	March 31, 2018								December 31, 2017
(dollars in thousands)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
ASSETS⁽¹⁾
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Impaired loans	—		—		6,551		6,551		—		—		6,759		6,759
Other real estate owned	—		—		2,880		2,880		—		—		444		444
Mortgage servicing rights	—		—		106		106		—		—		178		178
Total Assets	$	—	$	—	$	9,537	$	9,537	$	—	$	—	$	7,381	$	7,381
⁽¹⁾This table presents only the nonrecurring items that are recorded at fair value in our financial statements.

Carrying Values and Fair Values of Financial Instruments

The carrying values and fair values of our financial instruments at March 31, 2018 and December 31, 2017 are presented in the following tables:



	Carrying Value⁽¹⁾		Fair Value Measurements at March 31, 2018
(dollars in thousands)	Carrying Value⁽¹⁾		Total		Level 1		Level 2		Level 3
ASSETS
Cash and due from banks, including interest-bearing deposits	$	112,849	$	112,849	$	112,849	$	—	$	—
Securities	687,650		687,650		—		687,650		—
Loans held for sale	3,283		3,377		—		—		3,377
Portfolio loans, net	5,671,567		5,530,443		—		—		5,530,443
Bank owned life insurance	72,629		72,629		—		72,629		—
FHLB and other restricted stock	29,769		29,769		—		—		29,769
Trading securities held in a Rabbi Trust	5,048		5,048		5,048		—		—
Mortgage servicing rights	4,182		5,023		—		—		5,023
Interest rate swaps	4,669		4,669		—		4,669		—
Interest rate lock commitments	271		271		—		271		—
LIABILITIES
Deposits	$	5,387,094	$	5,372,506	$	—	$	—	$	5,372,506
Securities sold under repurchase agreements	44,617		44,617		—		—		44,617
Short-term borrowings	525,000		525,000		—		—		525,000
Long-term borrowings	46,684		46,892		—		—		46,892
Junior subordinated debt securities	45,619		45,619		—		—		45,619
Interest rate swaps	4,765		4,765		—		4,765		—
Interest rate lock commitments	24		24		—		24		—
⁽¹⁾ As reported in the Consolidated Balance Sheets



	Carrying Value⁽¹⁾		Fair Value Measurements at December 31, 2017
(dollars in thousands)	Carrying Value⁽¹⁾		Total		Level 1		Level 2		Level 3
ASSETS
Cash and due from banks, including interest-bearing deposits	$	117,152	$	117,152	$	117,152	$	—	$	—
Securities	698,291		698,291		—		698,291		—
Loans held for sale	4,485		4,583		—		—		4,583
Portfolio loans, net	5,705,059		5,690,292		—		—		5,690,292
Bank owned life insurance	72,150		72,150		—		72,150		—
FHLB and other restricted stock	29,270		29,270		—		—		29,270
Trading securities held in a Rabbi Trust	5,080		5,080		5,080		—		—
Mortgage servicing rights	4,133		4,571		—		—		4,571
Interest rate swaps	3,074		3,074		—		3,074		—
Interest rate lock commitments	226		226		—		226		—
LIABILITIES
Deposits	$	5,427,891	$	5,426,928	$	—	$	—	$	5,426,928
Securities sold under repurchase agreements	50,161		50,161		—		—		50,161
Short-term borrowings	540,000		540,000		—		—		540,000
Long-term borrowings	47,301		47,618		—		—		47,618
Junior subordinated debt securities	45,619		45,619		—		—		45,619
Interest rate swaps	3,055		3,055		—		3,055		—
Interest rate lock commitments	5		5		—		5		—
⁽¹⁾ As reported in the Consolidated Balance Sheets