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FAIR VALUE MEASUREMENTS (Tables)
12 Months Ended
Dec. 31, 2012
Fair Value Disclosures [Abstract]  
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring and Nonrecurring Basis
Assets and Liabilities Measured at Fair Value on a Recurring Basis at December 31 were as follows:

 
 
 
Fair Value Measurements at Reporting Date Using
 
 
 
Balance
 
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)        
 
Significant Other
Observable
Inputs
(Level 2)        
 
Significant
Unobservable
Inputs
(Level 3)
 
Total Gains (Losses)
 
(Dollars in thousands)
 
December 31, 2012
Recurring fair value measurements
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
Securities available for sale
 
 
 
 
 
 
 
 
 
U.S. Government agency securities
$
20,822

 
$
—

 
$
20,822

 
$
—

 
 
Agency mortgage-backed securities
221,425

 
—

 
221,425

 
—

 
 
Agency collateralized mortgage obligations
68,376

 
—

 
68,376

 
—

 
 
Private mortgage-backed securities
3,532

 
—

 
—

 
3,532

 
 
Single issuer trust preferred securities issued by banks and insurers
2,240

 
—

 
2,240

 
—

 
 
Pooled trust preferred securities issued by banks and insurers
2,981

 
—

 
—

 
2,981

 
 
Marketable securities
9,910

 
9,910

 
—

 
—

 
 
Loans held for sale
48,187

 
—

 
48,187

 
—

 
 
Derivative instruments
30,528

 
—

 
30,528

 
—

 
 
Liabilities
 
 
 
 
 
 
 
 
 
Derivative Instruments
46,793

 
—

 
46,793

 
—

 
 
Total recurring fair value measurements
$
361,208

 
$
9,910

 
$
344,785

 
$
6,513

 
 
 
 
 
 
 
 
 
 
 
 
Nonrecurring fair value measurements
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
Collateral Dependent Impaired Loans
$
7,817

 
$
—

 
$
—

 
$
7,817

 
$
(1,284
)
Other Real Estate Owned
11,974

 
—

 
—

 
11,974

 
—

Total nonrecurring fair value measurements
$
19,791

 
$
—

 
$
—

 
$
19,791

 
$
(1,284
)
 
 
 
 
 
 
 
 
 
 
 
December 31, 2011
Recurring fair value measurements
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
Trading securities
$
8,240

 
$
8,240

 
$
—

 
$
—

 
 
Securities available for sale
 
 
 
 
 
 
 
 
 
Agency mortgage-backed securities
238,391

 
—

 
238,391

 
—

 
 
Agency collateralized mortgage obligations
53,801

 
—

 
53,801

 
—

 
 
Private mortgage-backed securities
6,110

 
—

 
—

 
6,110

 
 
Single issuer trust preferred securities issued by banks and insurers
4,210

 
—

 
—

 
4,210

 
 
Pooled trust preferred securities issued by banks and insurers
2,820

 
—

 
—

 
2,820

 
 
Loans held for sale
20,500

 
—

 
20,500

 
—

 
 
Derivative instruments
25,841

 
—

 
25,841

 
—

 
 
Liabilities
 
 
 
 
 
 
 
 
 
Derivative instruments
44,407

 
—

 
44,407

 
—

 
 
Total recurring fair value measurements
315,506

 
8,240

 
294,126

 
13,140

 
 
 
 
 
 
 
 
 
 
 
 
Nonrecurring fair value measurements:
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
Impaired loans (1)
36,861

 
—

 
—

 
36,861

 
(2,682
)
Other real estate owned
6,658

 
—

 
—

 
6,658

 
—

Total nonrecurring fair value measurements
43,519

 
—

 
—

 
43,519

 
(2,682
)
(1)
Represents all impaired loans with an associated specific reserve at December 31, 2011. Included in this amount are $9.0 million of collateral dependent loans.
Reconciliation of Assets on Recurring Basis Using Significant Unobservable Inputs
The table below presents a reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3). These instruments were valued using pricing models and discounted cash flow methodologies.
Reconciliation for All Assets and Liabilities Measured at Fair Value on
a Recurring Basis Using Significant Unobservable Inputs (Level 3)

 
Securities Available for Sale
 
Pooled Trust
Preferred
Securities
 
Single Trust
Preferred
Securities
 
Private
Mortgage-
Backed
Securities
 
Total
 
(Dollars in thousands)
Year-to-date
 
 
 
 
 
 
 
Balance at December 31, 2010
$
2,828

 
$
4,221

 
$
10,254

 
$
17,303

Gains and losses (realized/unrealized)
 
 
 
 
 
 
 
Included in earnings
(8
)
 
—

 
(235
)
 
(243
)
Included in other comprehensive income
37

 
(11
)
 
49

 
75

Purchases
—

 
—

 
—

 
—

Sales
—

 
—

 
—

 
—

Issuances
—

 
—

 
—

 
—

Settlements
(37
)
 
—

 
(3,958
)
 
(3,995
)
Transfers in to level 3
—

 
—

 
—

 
—

Balance at December 31, 2011
$
2,820

 
$
4,210

 
$
6,110

 
$
13,140

Gains and losses (realized/unrealized)
 
 
 
 
 
 
 
Included in earnings
—

 
—

 
(76
)
 
(76
)
Included in other comprehensive income
313

 
703

 
411

 
1,427

Purchases
—

 
—

 
—

 
—

Sales
—

 
—

 
—

 
—

Issuances
—

 
—

 
—

 
—

Settlements
(152
)
 
—

 
(2,913
)
 
(3,065
)
Transfers into (out of) level 3
—

 
(4,913
)
 
—

 
(4,913
)
Balance at December 31, 2012
$
2,981

 
$
—

 
$
3,532

 
$
6,513

Schedule of Unobservable Inputs for Level 3 Securities
The following table sets forth certain unobservable inputs regarding the Company's investment in securities that are classified as Level 3:
 
Fair Value at December 31, 2012
 
Valuation Technique(s)
 
Unobservable Inputs
 
Range
 
Weighted Average
 
(Dollars in Thousands)
Pooled trust preferred securities
$
2,981

 
Discounted cash flow methodology
 
Cumulative prepayment
 
0% - 76%
 
7.5
%
 
 
 
 
 
Cumulative default
 
3.0% - 100%
 
19.6
%
 
 
 
 
 
Loss given default
 
85% - 100%
 
94.9
%
 
 
 
 
 
Cure given default
 
0% - 75%
 
33.8
%
Private mortgage-backed securities
$
3,532

 
Multi-dimensional spreads table
 
Cumulative prepayment rate
 
10.3% - 14.5%
 
13.9
%
 
 
 
 
 
Constant default rate
 
0.9% - 20.4%
 
4.0
%
 
 
 
 
 
Severity
 
20.0% - 55.0%
 
33.6
%
Impaired loans
$
7,817

 
Appraisals of collateral (1)
 
 
 
 
 
 
Other real estate owned
$
11,974

 
Appraisals of collateral (1)
 
 
 
 
 
 
(1)
Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable. Appraisals may be adjusted by management for qualitative factors such as economic factors and estimated liquidation expenses. The range of these possible adjustments may vary.
Schedule of Fair Values and Related Carrying Amounts by Balance Sheet Grouping
The estimated fair values and related carrying amounts for assets and liabilities for which fair value is only disclosed are shown below as of the periods indicated:

 
 
 
Fair Value Measurements at Reporting Date Using
 
Book Value
 
Fair Value
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable Inputs (Level 3)
 
December 31, 2012
 
(Dollars in thousands)
Financial assets
 
 
 
Securities held to maturity(a)


 


 

 

 

U.S. Treasury securities
$
1,013

 
$
1,134

 
$
—

 
$
1,134

 
$
—

Agency mortgage-backed securities
72,360

 
76,593

 
—

 
76,593

 
—

Agency collateralized mortgage obligations
97,507

 
100,380

 
—

 
100,380

 
—

State, county, and municipal securities
915

 
926

 
—

 
926

 
—

Single issuer trust preferred securities issued by banks
1,516

 
1,526

 
—

 
1,526

 
—

Corporate debt securities
5,007

 
5,265

 
—

 
5,265

 
—

Loans, net of allowance for loan losses(b)
4,467,177

 
4,462,580

 
—

 
—

 
4,462,580

Financial liabilities
 
 
 
 
 
 
 
 
 
Time certificates of deposits(c)
$
753,125

 
$
759,516

 
$
—

 
$
759,516

 
$
—

Federal home loan bank advances and other borrowings(c)
283,569

 
293,580

 
—

 
293,580

 
—

Wholesale and customer repurchase agreements(c)
203,359

 
201,189

 
—

 
—

 
201,189

Junior subordinated debentures(d)
74,127

 
74,416

 
—

 
74,416

 
—

Subordinated debentures(c)
30,000

 
22,762

 
—

 
—

 
22,762

 
 
 
 
 
 
 
 
 
 
 
December 31, 2011
Financial assets
(Dollars in thousands)
Securities held to maturity(a)
 
 


 
 
 
 
 
 
U.S. Treasury securities
$
1,014

 
$
1,117

 
$
—

 
$
1,117

 
$
—

Agency mortgage-backed securities
109,553

 
113,959

 
—

 
113,959

 
—

Agency collateralized mortgage obligations
77,804

 
80,298

 
—

 
80,298

 
 
State, county, and municipal securities
3,576

 
3,610

 
—

 
3,610

 
—

Single issuer trust preferred securities issued by banks
8,000

 
7,346

 
—

 
7,346

 
—

Corporate debt securities
5,009

 
5,164

 
—

 
5,164

 
—

Loans, net of allowance for loan losses(b)
3,746,130

 
3,807,938

 
—

 
—

 
3,807,938

Financial liabilities
 
 
 
 
 
 
 
 
 
Time certificates of deposits(c)
$
630,162

 
$
639,333

 
$
—

 
$
639,333

 
$
—

Federal home loan bank advances and other borrowings(c)
229,701

 
233,880

 
—

 
233,880

 
—

Wholesale and customer repurchase agreements(c)
216,128

 
219,857

 
—

 
—

 
219,857

Junior subordinated debentures(d)
61,857

 
60,620

 
—

 
60,620

 
—

Subordinated debentures(c)
30,000

 
27,217

 
—

 
—

 
27,217

 
(a)
The fair values presented are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments and/or discounted cash flow analysis.
(b)
Fair value is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities or cash flows.
(c)
Fair value was determined by discounting anticipated future cash payments using rates currently available for instruments with similar remaining maturities.
(d)
Fair value was determined based upon market prices of securities with similar terms and maturities.