Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

Fair Value Of Assets And Liabilities Measured On Recurring Basis

A summary of fair values for assets and liabilities measured at fair value on a recurring basis is as follows:



	At September 30, 2013
(In thousands)	Carrying Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets held at fair value:
Available for sale securities:
U.S. Treasury Bills	$	200	$	200	$	—	$	—
Agency CMOs	885,476		—		885,476		—
Agency MBS	1,293,254		—		1,293,254		—
Agency CMBS	20,084		—		20,084		—
CMBS	465,951		—		465,951		—
CLOs	332,534		—		332,534		—
Pooled trust preferred securities	29,964		—		—		29,964
Single issuer trust preferred securities	43,302		—		43,302		—
Corporate debt	113,618		—		113,618		—
Equity securities	9,389		9,114		275		—
Total available for sale securities	3,193,772		9,314		3,154,494		29,964
Derivative instruments:
Interest rate derivatives	38,517		—		38,517		—
Investments held in Rabbi Trust	5,909		5,909		—		—
Alternative investments	804		—		—		804
Total financial assets held at fair value	$	3,239,002	$	15,223	$	3,193,011	$	30,768
Financial liabilities held at fair value:
Derivative instruments:
Interest rate derivatives	$	27,008	$	—	$	27,008	$	—
Fed Fund futures contracts	187		187		—		—
Visa Swap	5		—		5		—
Mortgage banking derivatives	384		—		384		—
Total financial liabilities held at fair value	$	27,584	$	187	$	27,397	$	—



	At December 31, 2012
(In thousands)	Carrying Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial assets held at fair value:
Available for sale securities:
U.S. Treasury Bills	$	200	$	200	$	—	$	—
Agency CMOs	1,310,006		—		1,310,006		—
Agency MBS	1,142,280		—		1,142,280		—
CMBS	398,031		—		398,031		—
CLOs	88,540		—		—		88,540
Pooled trust preferred securities	26,207		—		—		26,207
Single issuer trust preferred securities	44,415		—		44,415		—
Corporate debt	118,199		—		118,199		—
Equity securities	8,282		8,082		200		—
Total available for sale securities	3,136,160		8,282		3,013,131		114,747
Derivative instruments:
Interest rate derivatives	50,969		—		50,969		—
Mortgage banking derivatives	2,898		—		2,898		—
Investments held in Rabbi Trust	5,741		5,741		—		—
Alternative investments	1,533		—		—		1,533
Total financial assets held at fair value	$	3,197,301	$	14,023	$	3,066,998	$	116,280
Financial liabilities held at fair value:
Derivative instruments:
Interest rate derivatives	$	43,172	$	—	$	43,172	$	—
Fed Fund futures contracts	125		125		—		—
Visa swap	4		—		4		—
Total financial liabilities held at fair value	$	43,301	$	125	$	43,176	$	—

Schedule Of Quantitative Inputs And Assumptions For Items Categorized In Level 3 Of The Fair Value Hierarchy

The following table presents the changes in Level 3 assets and liabilities that are measured at fair value on a recurring basis:



	Three months ended September 30,						Nine months ended September 30,
(In thousands)	2013			2012			2013			2012
Level 3, beginning of period	$	31,572		$	30,976		$	116,280		$	32,814
Transfers out of Level 3 ^{(1) (2)}	—			—			(248,844		)	(975		)
Change in unrealized loss included in other comprehensive income	7,194			1,587			14,194			2,279
Unrealized loss included in net income	(70		)	(539		)	(355		)	(1,161		)
Realized gain on sale of available for sale securities	269			—			269			—
Purchases/capital calls	—			—			159,412			126
Sales/proceeds	(7,740		)	—			(7,740		)	—
Accretion/amortization	26			63			214			79
Calls/paydowns	(483		)	(2,219		)	(2,662		)	(3,294		)
Level 3, end of period	$	30,768		$	29,868		$	30,768		$	29,868

(1)

As of April 1, 2013, the CLO portfolio was transferred from Level 3 to Level 2 based on having more observable inputs in determining fair value. In prior quarters, the CLO portfolio was priced using average non-binding broker quotes. During the second quarter, the Company engaged a third-party pricing vendor to provide monthly fair value measurements. The methodology used is a combination of matrix pricing, observed market activity and metrics. Pricing inputs such as credit spreads are observable and market corroborated and, therefore, the CLO portfolio qualifies for Level 2 categorization. The market for these CLOs is active and there is ample price transparency.


(2)	As of January 1, 2012, auction rate preferred securities were transferred from Level 3 to Level 2. These securities are considered to be Level 2 based upon observable market activity at full par value for recent transactions.

The following table presents information about quantitative inputs and assumptions for items categorized in Level 3 of the fair value hierarchy:



	At September 30, 2013
(Dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Range of Inputs (Weighted-Average)
Pooled trust preferred securities	$	29,964	Discounted cash flow	Discount rate	6.84 - 7.93% (7.71%)
				Credit spread	318-428 bps (406 bps)

Schedule Of Valuation Methodology And Unobservable Inputs

The table below presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis:



	At September 30, 2013
(Dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Range of Inputs
Impaired Loans	$	41,177	Real Estate Appraisals	Discount for dated appraisal	0% - 30%
				Discount for costs to sell	3% - 8%
Other Real Estate	$	7,919	Appraisals	Discount for costs to sell	8%
				Discount for appraisal type	25% - 50%
Mortgage Servicing Assets	$	25,496	Discounted cash flow	Constant prepayment rate	6.7% - 26.6%
				Discount Rates	3.1% - 6.0%

Summary Of Estimated Fair Values Of Significant Financial Instruments

The tables below summarize the estimated fair values of significant financial instruments:



	At September 30, 2013
(In thousands)	Carrying Balance	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Securities available for sale	3,193,772	$	9,314	$	3,154,494	$	29,964
Securities held-to-maturity	3,205,999	—		3,248,620		—
Loans held for sale	40,193	—		—		40,193
Loans and leases, net	12,320,420	—		—		12,410,295
Mortgage servicing assets ^(a)	20,577	—		—		25,496
Alternative investments	19,048	—		—		19,048
Derivative instruments	38,517	—		38,517		—
Investments held in Rabbi Trust	5,909	5,909		—		—
Liabilities
Deposits other than time deposits	12,741,904	—		12,741,904		—
Time deposits	2,257,627	—		2,280,333		—
Securities sold under agreements to repurchase and other borrowings	1,372,290	—		1,404,532		—
Federal Home Loan Bank advances ^(b)	1,602,469	—		1,636,387		—
Long-term debt ^(c)	229,146	—		224,097		—
Derivative instruments	27,584	187		27,397		—



	At December 31, 2012
(In thousands)	Carrying Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Securities available for sale	$	3,136,160	$	8,282	$	3,013,131	$	114,747
Securities held-to-maturity	3,107,529		—		3,264,718		—
Loans held for sale	107,633		—		—		107,633
Loans and leases, net	11,851,567		—		—		12,005,555
Mortgage servicing assets ^(a)	14,027		—		—		15,881
Alternative investments	19,523		—		—		19,523
Derivative instruments	53,867		—		53,867		—
Investments held in Rabbi Trust	5,741		5,741		—		—
Liabilities
Deposits other than time deposits	11,985,683		—		11,985,683		—
Time deposits	2,545,152		—		2,584,921		—
Securities sold under agreements to repurchase and other borrowings	1,076,160		—		1,134,614		—
Federal Home Loan Bank advances ^(b)	1,827,612		—		1,843,615		—
Long-term debt ^(c)	334,276		—		298,807		—
Derivative instruments	43,301		125		43,176		—


(a)	The carrying amount of mortgage servicing assets is net of $0.4 million and $1.8 million reserves at September 30, 2013 and December 31, 2012, respectively. The estimated fair value does not include such adjustments.


(b)	The carrying amount of FHLB advances is net of $67 thousand and $85 thousand in unamortized premiums at September 30, 2013 and December 31, 2012, respectively. The estimated fair value does not include such adjustments.


(c)	The carrying amount of long-term debt is net of $1.8 million and $4.4 million in hedge accounting adjustments and discounts at September 30, 2013 and December 31, 2012, respectively. The estimated fair value does not include such adjustments.

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References+ Details

- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

+ References+ Details