Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2021

Schedule of 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 June 30, 2021 and December 31, 2020.


	June 30, 2021
(dollars in thousands)	Level 1		Level 2		Level 3		Total
ASSETS
Available-for-sale debt securities:
U.S. Treasury securities	$	74,804	$	—	$	—	$	74,804
Obligations of U.S. government corporations and agencies	—		81,624		—		81,624
Collateralized mortgage obligations of U.S. government corporations and agencies	—		201,350		—		201,350
Residential mortgage-backed securities of U.S. government corporations and agencies	—		63,859		—		63,859
Commercial mortgage-backed securities of U.S. government corporations and agencies	—		325,303		—		325,303
Corporate obligations	—		499		—		499
Obligations of states and political subdivisions	—		91,840		—		91,840
Total Available-for-sale Debt Securities	74,804		764,475		—		839,279
Marketable equity securities	1,015		81		—		1,096
Total Securities	75,819		764,556		—		840,375
Securities held in a deferred compensation plan	7,808		—		—		7,808
Derivative financial assets:
Interest rate swaps	—		49,078		—		49,078
Interest rate lock commitments	—		—		1,137		1,137

Total Assets	$	83,627	$	813,634	$	1,137	$	898,398
LIABILITIES
Derivative financial liabilities:
Interest rate swaps	$	—	$	49,477	$	—	$	49,477
Forward sale contracts	—		91		—		91
Total Liabilities	$	—	$	49,568	$	—	$	49,568


	December 31, 2020
(dollars in thousands)	Level 1		Level 2		Level 3		Total
ASSETS
Available-for-sale debt securities:
U.S. Treasury securities	$	10,282	$	—	$	—	$	10,282
Obligations of U.S. government corporations and agencies	—		82,904		—		82,904
Collateralized mortgage obligations of U.S. government corporations and agencies	—		209,296		—		209,296
Residential mortgage-backed securities of U.S. government corporations and agencies	—		67,778		—		67,778
Commercial mortgage-backed securities of U.S. government corporations and agencies	—		273,681		—		273,681
Corporate obligations	—		2,025		—		2,025
Obligations of states and political subdivisions	—		124,427		—		124,427
Total Available-for-sale Debt Securities	10,282		760,111		—		770,393
Marketable equity securities	3,228		72		—		3,300
Total Securities	13,510		760,183		—		773,693
Securities held in a deferred compensation plan	6,794		—		—		6,794
Derivative financial assets:
Interest rate swaps	—		78,319		—		78,319
Interest rate lock commitments	—		—		2,900		2,900

Total Assets	$	20,304	$	838,502	$	2,900	$	861,706
LIABILITIES
Derivative financial liabilities:
Interest rate swaps	$	—	$	79,033	$	—	$	79,033
Forward sale contracts	—		385		—		385
Total Liabilities	$	—	$	79,418	$	—	$	79,418

Schedule of Assets Measured at Fair Value on Nonrecurring Basis by Significant Unobservable Inputs

For Level 3 assets measured at fair value on a nonrecurring basis as of June 30, 2021 and December 31, 2020, the significant unobservable inputs used in the fair value measurements were as follows:


	June 30, 2021		Valuation Technique	Significant Unobservable Inputs	Range			Weighted Average (1) (2) (3)
(dollars in thousands)
Loans individually evaluated	$	60,778	Collateral method	Appraisal adjustment	—%	-	32.00%	13.68%
Other real estate owned	1,088		Collateral method	Costs to sell	4.00%	-	7.00%	4.21%
Mortgage servicing rights	6,658		Discounted cash flow method	Discount rate	9.21%	-	12.54%	9.39%
				Constant prepayment rates	8.38%	-	15.10%	11.13%
Total Assets	$	68,524


	December 31, 2020		Valuation Technique	Significant Unobservable Inputs	Range			Weighted Average (1) (2) (3)
(dollars in thousands)
Loans individually evaluated	$	67,402	Collateral method	Appraisal adjustment	—%	-	47.00%	16.90%
Other real estate owned	1,953		Collateral method	Costs to sell	4.00%	-	7.00%	4.92%
Mortgage servicing rights	4,976		Discounted cash flow method	Discount rate	9.24%	-	12.55%	9.42%
				Constant prepayment rates	8.82%	-	14.58%	13.37%
Loans held for sale	586		Contractual agreement	None	NA			NA
Total Assets	$	74,917
NA - not applicable
(1) Weighted averages for loans individually evaluated were weighted by loan amounts. (2) Weighted averages for other real estate owned were weighted by OREO balances. (3) Weighted averages for mortgage servicing rights discount rate and prepayment rates are based on note rate tranches and voluntary constant prepayment rates.

Schedule of Carrying Values and Fair Values of Financial Instruments

The carrying values and fair values of our financial instruments at June 30, 2021 and December 31, 2020 are presented in the following tables:


	Carrying Value(1)		Fair Value Measurements at June 30, 2021
(dollars in thousands)			Total		Level 1		Level 2		Level 3
ASSETS
Cash and due from banks, including interest-bearing deposits	$	985,278	$	985,278	$	985,278	$	—	$	—
Securities	840,375		840,375		75,819		764,556		—
Loans held for sale	7,648		7,648		—		7,648		—
Portfolio loans, net	6,897,715		6,808,655		—		—		6,808,655
Bank owned life insurance	83,087		—		—		—		—

Collateral receivable	45,703		45,703		45,703		—		—
Securities held in a deferred compensation plan	7,808		7,808		7,808		—		—
Mortgage servicing rights	6,658		6,658		—		—		6,658
Interest rate swaps	49,078		49,078		—		49,078		—
Interest rate lock commitments	1,137		1,137		—		—		1,137

LIABILITIES
Deposits	$	8,015,264	$	8,014,963	$	6,745,643	$	1,269,320	$	—
Securities sold under repurchase agreements	68,587		68,587		68,587		—		—
Short-term borrowings	—		—		—		—		—
Long-term borrowings	22,969		23,529		4,398		19,131		—
Junior subordinated debt securities	64,112		64,112		64,112		—		—
Interest rate swaps	49,477		49,477		—		49,477		—
Forward sale contracts	91		91		—		91		—
(1) As reported in the Consolidated Balance Sheets


	Carrying Value(1)		Fair Value Measurements at December 31, 2020
(dollars in thousands)			Total		Level 1		Level 2		Level 3
ASSETS
Cash and due from banks, including interest-bearing deposits	$	229,666	$	229,666	$	229,666	$	—	$	—
Securities	773,693		773,693		13,510		760,183		—
Loans held for sale	18,528		18,528		—		—		18,528
Portfolio loans, net	7,108,248		7,028,446		—		—		7,028,446
Bank owned life insurance	82,303		82,303		—		82,303		—

Collateral receivable	77,936		77,936		77,936		—		—
Securities held in a deferred compensation plan	6,794		6,794		6,794		—		—
Mortgage servicing rights	4,976		4,976		—		—		4,976
Interest rate swaps	78,319		78,319		—		78,319		—
Interest rate lock commitments	2,900		2,900		—		—		2,900

LIABILITIES
Deposits	$	7,420,538	$	7,422,894	$	6,033,075	$	1,389,819	$	—
Securities sold under repurchase agreements	65,163		65,163		65,163		—		—
Short-term borrowings	75,000		75,000		75,000		—		—
Long-term borrowings	23,681		24,545		4,494		20,051		—
Junior subordinated debt securities	64,083		64,083		64,083		—		—
Interest rate swaps	79,033		79,033		—		79,033		—
Forward sale contracts	385		385		—		385		—
(1) As reported in the Consolidated Balance Sheets