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Fair Value Measurements (Tables)
9 Months Ended
Sep. 30, 2015
Fair Value Disclosures [Abstract]  
Assets and liabilities measured at fair value on a recurring basis
Assets and liabilities measured at fair value at the periods indicated 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)
 
September 30, 2015
 
(Dollars in thousands)
Recurring fair value measurements
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Trading securities
$
454

 
$
454

 
$

 
$

Securities available for sale
 
 
 
 
 
 
 
U.S. Government agency securities
37,587

 

 
37,587

 
$

Agency mortgage-backed securities
212,921

 

 
212,921

 

Agency collateralized mortgage obligations
52,075

 

 
52,075

 

State, county, and municipal securities
4,671

 

 
4,671

 

Single issuer trust preferred securities issued by banks and insurers
2,841

 

 
2,841

 

Pooled trust preferred securities issued by banks and insurers
1,586

 

 

 
1,586

Small business administration pooled securities
41,156

 

 
41,156

 

Equity securities
12,955

 
12,955

 

 

Loans held for sale
11,476

 

 
11,476

 

Derivative instruments
30,216

 

 
30,216

 

Liabilities
 
 
 
 
 
 
 
Derivative instruments
34,191

 

 
34,191

 

Total recurring fair value measurements
$
373,747

 
$
13,409

 
$
358,752

 
$
1,586

 
 
 
 
 
 
 
 
Nonrecurring fair value measurements
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Collateral dependent impaired loans
$
6,011

 
$

 
$

 
$
6,011

Other real estate owned and other foreclosed assets
2,532

 

 

 
2,532

Total nonrecurring fair value measurements
$
8,543

 
$

 
$

 
$
8,543


 
 
 
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)
 
December 31, 2014
 
(Dollars in thousands)
Recurring fair value measurements
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Securities available for sale
 
 
 
 
 
 
 
U.S. Government agency securities
$
41,486

 
$

 
$
41,486

 
$

Agency mortgage-backed securities
217,678

 

 
217,678

 

Agency collateralized mortgage obligations
63,035

 

 
63,035

 

State, county, and municipal securities
5,223

 
 
 
5,223

 
 
Single issuer trust preferred securities issued by banks and insurers
2,909

 

 
2,909

 

Pooled trust preferred securities issued by banks and insurers
6,321

 

 

 
6,321

Equity securities
11,902

 
11,902

 

 

Loans held for sale
6,888

 

 
6,888

 

Derivative instruments
22,688

 

 
22,688

 

Liabilities
 
 
 
 
 
 
 
Derivative instruments
27,950

 

 
27,950

 

Total recurring fair value measurements
$
350,180

 
$
11,902

 
$
331,957

 
$
6,321

 
 
 
 
 
 
 
 
Nonrecurring fair value measurements:
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Collateral dependent impaired loans
$
8,196

 
$

 
$

 
$
8,196

Other real estate owned and other foreclosed assets
7,743

 

 

 
7,743

Total nonrecurring fair value measurements
$
15,939

 
$

 
$

 
$
15,939

Reconciliation for all assets and liabilities measured at fair value on a recurring basis
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), which were valued using pricing models and discounted cash flow methodologies, as of the dates indicated:
 
Securities Available for Sale:
 
Three Months Ended September 30, 2015
 
Three Months Ended September 30, 2014
 
(Dollars in thousands)
Pooled Trust Preferred Securities
 
Beginning balance
$
1,595

 
$
5,091

Gains and (losses) (realized/unrealized)
 
 
 
Included in other comprehensive income
12

 
318

Settlements
(21
)
 
(23
)
Ending balance
$
1,586

 
$
5,386



Investments in securities that are classified as level 3
The following table sets forth certain unobservable inputs regarding the Company’s investment in securities that are classified as Level 3 for the periods indicated:
 
 
September 30
 
December 31
 
 
 
September 30
 
December 31
 
September 30
 
December 31
 
 
2015
 
2014
 
 
 
2015
 
2014
 
2015
 
2014
Valuation Technique
 
Fair Value
 
Unobservable Inputs
 
Range
 
Weighted Average
 
 
(Dollars in thousands)
 
 
Discounted cash flow methodology
 
 
 
 
 
 
 
 
 
 
Pooled trust preferred securities
 
$
1,586

 
$
6,321

 
Cumulative prepayment
 
0% - 65%
 
0% - 75%
 
2.5%
 
7.0%
 
 
 
 
 
 
Cumulative default
 
5% - 100%
 
3% - 100%
 
14.8%
 
13.9%
 
 
 
 
 
 
Loss given default
 
85% - 100%
 
85% - 100%
 
94.2%
 
96.1%
 
 
 
 
 
 
Cure given default
 
0% - 75%
 
0% - 75%
 
63.8%
 
46.7%
Appraisals of collateral (1)
 
 
 
 
 
 
 
 
 
 
Impaired loans
 
$
6,011

 
$
8,196

 
 
 
 
 
 
 
 
 
 
Other real estate owned and foreclosed assets
 
$
2,532

 
$
7,743

 
 
 
 
 
 
 
 
 
 
 
(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.
The estimated fair values and related carrying amounts for assets and liabilities
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
 
Carrying
Value
 
Fair
Value
 
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
  
September 30, 2015
 
(Dollars in thousands)
Financial assets
 
 
 
Securities held to maturity(a)
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
$
1,009

 
$
1,084

 
$

 
$
1,084

 
$

Agency mortgage-backed securities
172,684

 
178,402

 

 
178,402

 

Agency collateralized mortgage obligations
230,820

 
231,910

 

 
231,910

 

State, county, and municipal securities
225

 
229

 

 
229

 

Single issuer trust preferred securities issued by banks
1,500

 
1,496

 

 
1,496

 

Small business administration pooled securities
36,901

 
37,613

 

 
37,613

 

Corporate debt securities
5,000

 
5,042

 

 
5,042

 

Loans, net of allowance for loan losses(b)
5,436,905

 
5,406,492

 

 

 
5,406,492

Financial liabilities
 
 
 
 
 
 
 
 
 
Time certificates of deposits(c)
$
711,263

 
$
713,473

 
$

 
$
713,473

 
$

Federal Home Loan Bank borrowings(c)
104,133

 
104,989

 

 
104,989

 

Customer repurchase agreements and other short-term borrowings(c)
138,449

 
138,449

 

 

 
138,449

Junior subordinated debentures(d)
73,520

 
70,925

 

 
70,925

 

Subordinated debentures(c)
35,000

 
35,282

 

 

 
35,282

 

 
 
 
 
 
Fair Value Measurements at Reporting Date Using
 
Carrying
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, 2014
 
(Dollars in thousands)
Financial assets
 
Securities held to maturity(a)
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
$
1,010

 
$
1,073

 
$

 
$
1,073

 
$

Agency mortgage-backed securities
159,522

 
164,944

 

 
164,944

 

Agency collateralized mortgage obligations
198,220

 
196,584

 

 
196,584

 

State, county, and municipal securities
424

 
428

 

 
428

 

Single issuer trust preferred securities issued by banks
1,500

 
1,477

 

 
1,477

 

Small business administration pooled securities
9,775

 
10,074

 

 
10,074

 

Corporate debt securities
5,002

 
5,119

 

 
5,119

 

Loans, net of allowance for loan losses(b)
4,907,437

 
4,875,283

 

 

 
4,875,283

Financial liabilities
 
 

 
 
 
 
 
 
Time certificates of deposits(c)
$
649,620

 
$
651,180

 
$

 
$
651,180

 
$

Federal Home Loan Bank borrowings(c)
70,080

 
70,208

 

 
70,208

 

Customer repurchase agreements and other short-term borrowings(c)
147,890

 
147,890

 

 

 
147,890

Wholesale repurchase agreements(c)
50,000

 
50,510

 

 

 
50,510

Junior subordinated debentures(d)
73,685

 
70,045

 

 
70,045

 

Subordinated debentures(c)
65,000

 
64,198

 

 

 
64,198


(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 analyses.
(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.