When determining the fair value measurements for assets and liabilities, United looks to active and observable markets to price identical assets or liabilities whenever possible and classifies such items in Level 1. When identical assets and liabilities are not traded in active markets, United looks to market observable data for similar assets and liabilities and classifies such items as Level 2. Nevertheless, certain assets and liabilities are not actively traded in observable markets and United must use alternative valuation techniques using unobservable inputs to determine a fair value and classifies such items as Level 3. For assets and liabilities that are not actively traded, the fair value measurement is based primarily upon estimates that require significant judgment. Therefore, the results may not be realized in an actual sale or immediate settlement of the asset or liability. Additionally, there are inherent weaknesses in any calculation technique, and changes in the underlying assumptions used, including discount rates and estimates of future cash flows, could significantly affect the results of current or future values. The level within the fair value hierarchy is based on the lowest level of input that is significant in the fair value measurement.

In accordance with ASC Topic 820, the following describes the valuation techniques used by United to measure certain financial assets and liabilities recorded at fair value on a recurring basis in the financial statements.

Securities available for sale and equity securities

: Securities available for sale and equity securities are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted market prices, when available (Level 1). If quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar securities for which significant assumptions are derived primarily from or corroborated by observable market data. Using a market approach valuation methodology, third party vendors compile prices based on observable market inputs, which include benchmark yields, reported trades, issuer spreads, benchmark securities, and “To Be Announced” prices (Level 2). Management internally reviews the fair values provided by third party vendors on a monthly basis. Management also performs a quarterly price testing analysis at the individual security level which compares the pricing provided by the third party vendors to an independent pricing source’s valuation of the same securities. Variances that are deemed to be material are reviewed by management. Additionally, to further assess the reliability of the information received from third party vendors, management obtains documentation from third party vendors related to the sources, methodologies, and inputs utilized in valuing securities classified as Level 2. Management analyzes this information to ensure the underlying assumptions appear reasonable. Management also obtains an independent service auditor’s report from third party vendors to provide reasonable assurance that appropriate controls are in place over the valuation process. Upon completing its review of the pricing from third party vendors at June 30, 2020, management determined that the prices provided by its third party pricing source were reasonable and in line with management’s expectations for the market values of these securities. Therefore, prices obtained from third party vendors that did not reflect forced liquidation or distressed sales were not adjusted by management at June 30, 2020. Management utilizes a number of

factors to determine if a market is inactive, all of which may require a significant level of judgment. Factors that management considers include: a significant widening of the

bid-ask

spread, a considerable decline in the volume and level of trading activity in the instrument, a significant variance in prices among market participants, and a significant reduction in the level of observable inputs. Any securities available for sale not valued based upon quoted market prices or third party pricing models that consider observable market data are considered Level 3. Currently, United considers its valuation of

available-for-sale

Trup

Cdos

as Level 3. Based upon management’s review of the market conditions for

Trup

Cdos

, it was determined that an income approach valuation technique (present value technique) that maximizes the use of relevant observable inputs

and minimizes the use of unobservable inputs is the most representative measurement technique for these securities. The present value technique

discounts

expected future cash flows of a security to arrive at a present value. Management considers the following items when calculating the appropriate discount rate: the implied rate of return when the market was last active, changes in the implied rate of return as markets moved from very active to inactive, recent changes in credit ratings, and recent activity showing that the market has built in increased liquidity and credit premiums. Management’s internal credit review of each security was also factored in to determine the appropriate discount rate. The credit review considered each security’s collateral, subordination, excess spread, priority of claims, principal and interest.

Loans held for sale

: For residential mortgage loans sold in the mortgage banking segment, the loans closed are recorded at fair value using the fair value option which is measured using valuations from investors for loans with similar characteristics (Level 2) with some adjusted for the Company’s actual sales experience versus the investor’s indicated pricing (Level 3). The unobservable input for Level 3 valuations is the Company’s historical sales prices. For June 30, 2020, the range of historical sales prices increased the investor’s indicated pricing by a range of 0.12% to 0.52% with a weighted average increase of 0.29%.

Derivatives

: United utilizes interest rate swaps to hedge exposure to interest rate risk and variability of cash flows associated to changes in the underlying interest rate of the hedged item. These hedging interest rate swaps are classified as either a fair value hedge or a cash flow hedge. United utilizes third-party vendors for derivative valuation purposes. These vendors determine the appropriate fair value based on a net present value calculation of the cash flows related to the interest rate swaps using primarily observable market inputs such as interest rate yield curves (Level 2). Valuation adjustments to derivative fair values for liquidity and credit risk are also taken into consideration, as well as the likelihood of default by United and derivative counterparties, the net counterparty exposure and the remaining maturities of the positions. Values obtained from third party vendors are typically not adjusted by management. Management internally reviews the derivative values provided by third party vendors on a quarterly basis. All derivative values are tested for reasonableness by management utilizing a net present value calculation.

For a fair value hedge, the fair value of the interest rate swap is recognized on the balance sheet as either a freestanding asset or liability with a corresponding adjustment to the hedged financial instrument. Subsequent adjustments due to changes in the fair value of a derivative that qualifies as a fair value hedge are offset in current period earnings either in interest income or interest expense depending on the nature of the hedged financial instrument. For a cash flow hedge, the fair value of the interest rate swap is recognized on the balance sheet as either a freestanding asset or liability with a corresponding adjustment to other comprehensive income within shareholders’ equity, net of tax. Subsequent adjustments due to changes in the fair value of a derivative that qualifies as a cash flow hedge are offset to other comprehensive income, net of tax. The portion of a hedge that is ineffective is recognized immediately in earnings.

The Company records its interest rate lock commitments and forward loan sales commitments at fair value determined as the amount that would be required to settle each of these derivative financial instruments at the balance sheet date. In the normal course of business, United’s mortgage banking subsidiaries enter into contractual interest rate lock commitments to extend credit to borrowers with fixed expiration dates. The commitments become effective when the borrowers

“lock-in”

a specified interest rate within the timeframes established by the mortgage companies. All borrowers are evaluated for credit worthiness prior to the extension of the commitment. Market risk arises if interest rates move adversely between the time of the interest rate lock by the borrower and the sale date of the loan to the investor. To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, United’s mortgage banking subsidiaries enter into either a forward sales contract to sell loans to investors when using best efforts or a TBA mortgage-backed security under mandatory delivery. As TBA mortgage-backed securities are actively traded in an open market, TBA mortgage-backed securities fall into a Level 1 category. The forward sales contracts lock in an interest rate and price for the sale of loans similar to the specific rate lock commitments. Under the Company’s best efforts model, the rate lock commitments to borrowers and the forward sales contracts to investors

through to the date the loan closes are undesignated derivatives and accordingly, are marked to fair value through earnings. These valuations fall into a Level 2 category. For residential mortgage loans sold in the mortgage banking segment, the interest rate lock commitments are recorded at fair value which is measured using valuations from investors for loans with similar characteristics (Level 2) with some adjusted for the Company’s actual sales experience versus the investor’s indicated pricing (Level 3). The unobservable input for Level 3 valuations is the Company’s historical sales prices. For June 30, 2020, the range of historical sales prices increased the investor’s indicated pricing by a range of 0.12% to 0.52% with a weighted average increase of 0.29%.

For interest rate swap derivatives that are not designated in a hedge relationship, changes in the fair value of the derivatives are recognized in earnings in the same period as the change in the fair value. Unrealized gains and losses due to changes in the fair value of other derivative financial instruments not in hedge relationship are included in noninterest income and noninterest expense, respectively.

The following tables present the balances of financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, segregated by the level of the valuation inputs within the fair value hierarchy.


			Fair Value at June 30, 2020 Using
Description	Balance as of June 30, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Available for sale debt securities:
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	67,303	$	0	$	67,303	$	0
State and political subdivisions		520,880		0		520,880		0
Residential mortgage-backed securities
Agency		848,231		0		848,231		0
Non-agency		62,965		0		62,965		0
Commercial mortgage-backed securities
Agency		622,785		0		622,785		0
Asset-backed securities		277,721		0		277,721		0
Trust preferred collateralized debt obligations		12,837		0		0		12,837
Single issue trust preferred securities		16,191		0		16,191		0
Other corporate securities		371,028		6,432		364,596		0

Total available for sale securities		2,799,941		6,432		2,780,672		12,837
Equity securities:
Financial services industry		103		103		0		0

Equity mutual funds (1)		3,783		3,783		0		0
Other equity securities		5,989		5,989		0		0

Total equity securities		9,875		9,875		0		0
Loans held for sale		611,277		0		45,480		565,797
Derivative financial assets:
Forward sales commitments		1,745		0		1,745		0
Interest rate lock commitments		27,833		0		7,413		20,420

Total derivative financial assets		29,578		0		9,158		20,420
Liabilities
Derivative financial liabilities:
Interest rate swap contracts		10,083		0		10,083		0
TBA mortgage-backed securities		4,224		0		4,224		0

Total derivative financial liabilities		14,307		0		14,307		0

(1)	The equity mutual funds are within a rabbi trust for the payment of benefits under a deferred compensation plan for certain key

officers of United and its subsidiaries.


			Fair Value at December 31, 2019 Using
Description	Balance as of December 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Available for sale debt securities:
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	58,676	$	0	$	58,676	$	0
State and political subdivisions		272,362		0		272,362		0
Residential mortgage-backed securities
Agency		836,534		0		836,534		0
Non-agency		3,833		0		3,833		0
Commercial mortgage-backed securities
Agency		614,973		0		614,973		0
Asset-backed securities		276,139		0		276,139		0
Trust preferred collateralized debt obligations		4,703		0		0		4,703
Single issue trust preferred securities		16,774		0		16,774		0
Other corporate securities		353,302		6,586		346,716		0

Total available for sale securities		2,437,296		6,586		2,426,007		4,703
Equity securities:
Financial services industry		154		154		0		0
Equity mutual funds (1)		3,971		3,971		0		0
Other equity securities		4,769		4,769		0		0

Total equity securities		8,894		8,894		0		0
Loans held for sale		384,375		0		0		384,375

Derivative financial assets:
Interest rate swap contracts		9		0		9		0
Forward sales commitments		4,518		0		0		4,518

Total derivative financial assets		4,527		0		9		4,518
Liabilities
Derivative financial liabilities:		2,394		0		2,394		0
TBA mortgage-backed securities		671		0		671		0

Total derivative financial liabilities		3,065		0		3,065		0

(1)	The equity mutual funds are within a rabbi trust for the payment of benefits under a deferred compensation plan for certain key officers of United and its subsidiaries.

There were no transfers between Level 1 and Level 2 for financial assets and liabilities measured at fair value on a recurring basis during the six months ended June 30, 2020 and the year ended December 31, 2019.

The following table presents additional information about financial assets and liabilities

measured

at fair value at June 30, 2020 and December 31, 2019 on a recurring basis and for which United has utilized Level 3 inputs to determine fair value:


	Available for sale Securities
	Trust preferred collateralized debt obligations
	June 30, 2020		December 31, 2019
Balance, beginning of period	$	4,703	$	5,917
Total gains or losses (realized/unrealized):
Included in earnings (or changes in net assets)		0		(155	)
Included in other comprehensive income		2,318		(1,059	)
Acquired in Carolina Financial merger		5,816		0

Balance, end of period	$	12,837	$	4,703

The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	0	$	0


	Loans held for sale
	June 30, 2020			December 31, 2019
Balance, beginning of period	$	384,375		$	247,104
Originations		2,363,759			2,941,722
Sales		(2,261,049	)		(2,888,257	)
Total gains or losses during the period recognized in earnings		78,712			83,806

Balance, end of period	$	565,797		$	384,375

The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	0		$	0

	Derivative Financial Assets Interest Rate Lock Commitments
	June 30, 2020			December 31, 2019
Balance, beginning of period	$	4,518		$	4,103
Transfers other		15,902			415

Balance, end of period	$	20,420		$	4,518

The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	0		$	0

Certain financial assets are measured at fair value on a nonrecurring basis in accordance with GAAP. Adjustments to the fair value of these assets usually result from the application of

lower-of-cost-or-market

accounting or write-downs of individual assets.

Fair Value Option

United elected the fair value option for the loans held for sale in its mortgage banking segment to mitigate a divergence between accounting losses and economic exposure.

The following table reflects the change in fair value included in earnings of financial instruments for which the fair value option has been elected:


Description	Three Months Ended June 30, 2020		Three Months Ended June 30, 2019
Assets
Loans held for sale
Income from mortgage banking activities	$	8,846	$	4,578


Description	Six Months Ended June 30, 2020		Six Months Ended June 30, 2019
Assets
Loans held for sale
Income from mortgage banking activities	$	10,471	$	6,542

The following table reflects the difference between the aggregate fair value and the remaining contractual principal outstanding for financial instruments for which the fair value option has been elected:


	June 30, 2020						December 31, 2019
Description	Unpaid Principal Balance		Fair Value		Fair Value Ove r / (Under) Unpaid Principal Balance		Unpaid Principal Balance		Fair Value		Fair Value Over/ (Under) Unpaid Principal Balance
Assets
Loans held for sale	$	591,397	$	611,277	$	19,880	$	375,274	$	384,375	$	9,101

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

The following describes the valuation techniques used by United to measure certain financial assets recorded at fair value on a nonrecurring basis in the financial statements.

Loans held for sale

: Loans held for sale within the community banking segment that are delivered on a best efforts basis are carried at the lower of cost or fair value. The fair value is based on the price secondary markets are currently offering for similar loans using observable market data which is not materially different than cost due to the short duration between origination and sale (Level 2). As such, United records any fair value adjustments for these loans held for sale on a nonrecurring basis. No nonrecurring fair value adjustments were recorded on loans held for sale during the three months ended June 30, 2020. Gains and losses on sale of loans are recorded within income from mortgage banking activities on the Consolidated Statements of Income.

Individually assessed loans

: In the determination of the allowance for loan losses, loans that do not share risk characteristics are evaluated on an individual basis. Loans evaluated individually are not also included in the collective evaluation. When management determines that foreclosure is probable or when the borrower is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of the collateral, expected credit losses are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. Fair value is measured using a market approach based on the value of the collateral securing the loans. Collateral may be in the form of real estate or business assets including equipment, inventory, and accounts receivable. The vast majority of the collateral is real estate. The value of real estate collateral is determined utilizing an appraisal conducted by an independent, licensed appraiser outside of the Company using comparable property sales (Level 2). However, if the collateral is a house or building in the process of

construction

or if an appraisal of the real estate property is over two years old, then the fair value is considered Level 3. The value of

business equipment is based upon an outside appraisal if deemed significant, or the net book value on the applicable business’ financial statements if not considered significant using observable market data. Likewise, values for inventory and accounts receivables collateral are based on financial statement balances or aging reports (Level 3). For individually assessed loans, a specific reserve is established through the allowance for loan losses, if necessary, by estimating the fair value of the underlying collateral on a nonrecurring basis. Any fair value adjustments are recorded in the period incurred as provision for credit losses expense on the Consolidated Statements of Income.

OREO

: OREO consists of real estate acquired in foreclosure or other settlement of loans. Such assets are carried on the balance sheet at the lower of the investment in the assets or the fair value of the assets less estimated selling costs. Fair value is determined by one of two market approach methods depending on whether the property has been vacated and an appraisal can be conducted. If the property has yet to be vacated and thus an appraisal cannot be performed, a Brokers Price Opinion (i.e. BPO), is obtained. A BPO represents a best estimate valuation performed by a realtor based on knowledge of current property values and a visual examination of the exterior condition of the property. Once the property is subsequently vacated, a formal appraisal is obtained and the recorded asset value appropriately adjusted. On the other hand, if the OREO property has been vacated and an appraisal can be conducted, the fair value of the property is determined based upon the appraisal using a market approach. An authorized independent appraiser conducts appraisals for United. Appraisals for property other than ongoing construction are based on consideration of comparable property sales (Level 2). In contrast, valuation of ongoing construction assets requires some degree of professional judgment. In conducting an appraisal for ongoing construction property, the appraiser develops two appraised amounts: an “as is” appraised value and a “completed” value. Based on professional judgment and their knowledge of the particular situation, management determines the appropriate fair value to be utilized for such property (Level 3). As a matter of policy, valuations are reviewed at least annually and appraisals are generally updated on a

bi-annual

basis with values lowered as necessary.

Intangible Assets

: For United, intangible assets consist of goodwill and core deposit intangibles. Goodwill is tested for impairment at least

annually

or sooner if indicators of impairment exist. Goodwill impairment would be defined as the difference between the recorded value of goodwill (i.e. book value) and the implied fair value of goodwill. In determining the implied fair value of goodwill for purposes of evaluating goodwill impairment, United determines the fair value of the reporting unit and compares the fair value to its carrying value. United may elect to perform a qualitative analysis to determine whether or not it is more-likely-than not that the fair value of a reporting unit is less than its carrying amount. If United elects to bypass this qualitative analysis, or concludes via qualitative analysis that it is

more-likely-than-not

that the fair value of a reporting unit is less than its carrying value, United may use either a market or income quantitative approach, whichever is more practical, to determine the fair value of the reporting unit to compare to its carrying value as step one. If the fair value is greater than the carrying value, then the reporting unit’s goodwill is deemed not to be impaired. If the fair value is less than the carrying value, then a second step is performed which measures the amount of impairment by comparing the carrying amount of the goodwill to its implied fair value. If the implied fair value of the goodwill exceeds the carrying amount, there is no impairment. If the carrying amount exceeds the implied fair value of goodwill, an impairment charge is recorded for the excess. At each reporting date, the Company considers potential indicators of impairment. Given the current economic uncertainty and volatility surrounding

COVID-19

and the performance of the Company’s stock, United performed a qualitative assessment to determine if any indicators of impairment would imply that it was more likely than not that goodwill was impaired as of June 30, 2020. After assessing several impairment indicators, United determined that it was not

more-likely-than-not

that goodwill was impaired as of June 30, 2020. In subsequent periods,

COVID-19

could cause a further and sustained decline in our stock price and other impairment indicators which would cause us to perform a goodwill impairment test and could result in an impairment charge being recorded for that period if the carrying value of goodwill was found to exceed fair value. Core deposit intangibles relate to the estimated value of the deposit base of acquired institutions. Management reviews core deposit intangible assets on an annual basis, or sooner if indicators of impairment exist, and evaluates changes in facts and circumstances that may indicate impairment in the carrying value. Other than those intangible assets recorded in the acquisition of Carolina Financial in the second quarter of 2020, no other fair value measurement of intangible assets was made during the first six months of 2020 and 2019.

Mortgage Servicing Rights (

“

MSRs

”

A mortgage servicing right asset represents the amount by which the present value of the estimated future net cash flows to be received from servicing loans are expected to more than adequately compensate the Company for performing the servicing. The Company initially measures servicing assets and liabilities retained related to the sale of residential loans held for sale (“mortgage servicing rights”) at fair value, if practicable. For subsequent measurement purposes, the Company measures servicing assets and liabilities based on the lower of cost or market quarterly on a nonrecurring basis. The quarterly determination of fair value of servicing rights is provided by a third party and is estimated using a present value cash flow model. The most important assumptions used in the valuation model are the anticipated rate of the loan prepayments and discount rates. Although some assumptions in determining fair value are based on standards used by market participants, some are based on unobservable inputs and therefore are classified in Level 3 of the valuation hierarchy. The unobservable inputs for Level 3 valuations are market discount rates, anticipated prep

ayment speeds,

projected

elinquency rates, and ancillary fee income net of servicing costs. For June 30, 2020, the average range of discount rates was 10.50% to 12.91% with a weighted average discount rate of 10.63%; the average range of constant prepayment rates was 7.08% to 15.66% with a weighted average prepayment rate of 14.40%; the net servicing fee was 0.26%; and th

delinquency rate

, including loans on forbearance

was 3.78%.

The Company recorded a $710 temporary impairment of mortgage servicing rights in the quarter ended June 30, 2020. The Company does not hedge the mortgage servicing rights positions and the impact of falling long-term interest rates increased prepayment speed assumptions reducing the value of MSRs asset.

The following table summarizes United’s financial assets that were measured at fair value on a nonrecurring basis during the period:


			Carrying value at June 30, 2020
Description	Balance as of June 30, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		YTD Gains (Losses)
Assets
Loans held for sale	$	14,707	$	0	$	14,707	$	0	$	(2	)
Individually assessed loans		59,488		0		49,732		9,756		568
OREO		29,947		0		29,898		49		(440	)
Mortgage servicing rights		20,200		0		0		20,200		(710	)


			Carrying value at December 31, 2019
Description	Balance as of December 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		YTD Gains (Losses)
Assets
Loans held for sale	$	3,139	$	0	$	3,139	$	0	$	(4	)
Impaired Loans		68,213		0		55,792		12,421		1,831
OREO		15,515		0		15,495		20		(785	)

Fair Value of Other Financial Instruments

The following methods and assumptions were used by United in estimating its fair value disclosures for other financial instruments:

Cash and Cash Equivalents:

The carrying amounts reported in the balance sheet for cash and cash equivalents approximate those assets’ fair values.

Securities held to maturity and other securities

: The estimated fair values of securities held to maturity are based on quoted market prices, where available. If quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar securities for which significant assumptions are derived primarily from or corroborated by observable market data. Third party vendors compile prices from various sources and may determine the fair value of identical or similar securities by using pricing models that consider observable market data. Any securities held to maturity, not valued based upon the methods above, are valued based on a discounted cash flow methodology using appropriately adjusted discount rates reflecting nonperformance and liquidity risks. Other securities consist mainly of shares of Federal Home Loan Bank and Federal Reserve Bank stock that do not have readily determinable fair values and are carried at cost.

Loans

: The fair values of certain mortgage loans (e.g.,

one-to-four

family residential), credit card loans, and other consumer loans are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. The fair values of other loans (e.g., commercial real estate and rental property mortgage loans, commercial and industrial loans, financial institution loans and agricultural loans) are estimated using discounted cash flow analyses, using market interest rates currently being offered for loans with similar terms to borrowers of similar creditworthiness, which include adjustments for liquidity concerns. For acquired impaired loans, fair value is assumed to equal United’s carrying value, which represents the present value of expected future principal and interest cash flows, as adjusted for any Allowance for Credit Losses recorded for these loans.

Deposits

: The fair values of demand deposits (e.g., interest and noninterest checking, regular savings and certain types of money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). The carrying amounts of variable-rate, fixed-term money market accounts and certificates of deposit approximate their fair values at the reporting date. Fair values of fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits.

Short-term Borrowings:

The carrying amounts of federal funds purchased, borrowings under repurchase agreements and any other short-term borrowings approximate their fair values.

Long-term Borrowings:

The fair values of United’s Federal Home Loan Bank borrowings and trust preferred securities are estimated using discounted cash flow analyses, based on United’s current incremental borrowing rates for similar types of borrowing arrangements.

Summary of Fair Values for All Financial

Instruments

The estimated fair values of United’s financial instruments are summarized below:


					Fair Value Measurements
	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Cash and cash equivalents	$	2,062,813	$	2,062,813	$	0	$	2,062,813	$	0
Securities available for sale		2,799,941		2,799,941		6,432		2,780,672		12,837
Securities held to maturity		1,221		1,220		0		200		1,020
Equity securities		9,875		9,875		9,875		0		0
Other securities		251,161		238,603		0		0		238,603
Loans held for sale		625,984		625,984		0		60,187		565,797
Net loans		17,777,281		17,191,993		0		0		17,191,993
Derivative financial assets		29,578		29,578		0		9,158		20,420
Mortgage servicing rights		20,200		20,200		0		0		20,200
Deposits		19,893,843		19,902,498		0		19,902,498		0
Short-term borrowings		176,168		176,168		0		176,168		0
Long-term borrowings		1,633,891		1,597,685		0		1,597,685		0
Derivative financial liabilities		14,307		14,307		0		14,307		0
December 31, 2019
Cash and cash equivalents	$	837,493	$	837,493	$	0	$	837,493	$	0
Securities available for sale		2,437,296		2,437,296		6,586		2,426,007		4,703
Securities held to maturity		1,446		1,447		0		427		1,020
Equity securities		8,894		8,894		8,894		0		0
Other securities		222,161		211,053		0		0		211,053
Loans held for sale		387,514		387,514		0		3,139		384,375
Net loans		13,635,072		13,185,955		0		0		13,185,955
Derivative financial assets		4,527		4,527		0		9		4,518
Deposits		13,852,421		13,843,077		0		13,843,077		0
Short-term borrowings		374,654		374,654		0		374,654		0
Long-term borrowings		1,838,029		1,820,297		0		1,820,297		0
Derivative financial liabilities		3,065		3,065		0		3,065		0