Fair Value (Tables)

6 Months Ended

Jun. 30, 2014

Fair Value Tables

Financial instruments that were measured at fair value on a recurring and nonrecurring basis

The following table summarizes the Company’s financial instruments that were measured at fair value on a recurring and nonrecurring basis at June 30, 2014. The impaired loans shown below are those in which the value is based on the underlying collateral value.

($ in thousands)
Description of Financial Instruments	Fair Value at June 30, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring
Securities available for sale:
Government-sponsored enterprise securities	$	12,459		—		12,459		—
Mortgage-backed securities		104,699		—		104,699		—
Corporate bonds		790		—		790		—
Equity securities		6,130		—		6,130		—
Total available for sale securities	$	124,078		—		124,078		—
Nonrecurring
Impaired loans – covered	$	6,678		—		—		6,678
Impaired loans – non-covered		5,825		—		—		5,825
Foreclosed real estate – covered		9,934		—		—		9,934
Foreclosed real estate – non-covered		9,346		—		—		9,346

The following table summarizes the Company’s financial instruments that were measured at fair value on a recurring and nonrecurring basis at December 31, 2013.

($ in thousands)
Description of Financial Instruments	Fair Value at December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring
Securities available for sale:
Government-sponsored enterprise securities	$	18,245		—		18,245		—
Mortgage-backed securities		147,187		—		147,187		—
Corporate bonds		3,598		—		3,598		—
Equity securities		4,011		—		4,011		—
Total available for sale securities	$	173,041		—		173,041		—
Nonrecurring
Impaired loans – covered	$	15,284		—		—		15,284
Impaired loans – non-covered		13,020		—		—		13,020
Foreclosed real estate – covered		24,497		—		—		24,497
Foreclosed real estate – non-covered		12,251		—		—		12,251

Level 3 assets and liabilities measured at fair value on a recurring or non-recurring basis

For Level 3 assets and liabilities measured at fair value on a recurring or non-recurring basis as of June 30, 2014, the significant unobservable inputs used in the fair value measurements were as follows:

($ in thousands)
Description	Fair Value at June 30, 2014		Valuation Technique	Significant Unobservable Inputs	General Range of Significant Unobservable Input Values
Impaired loans – covered	$	6,678	Appraised value	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell	0-10%
Impaired loans – non-covered		5,825	Appraised value	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell	0-10%
Foreclosed real estate – covered		9,934	Appraised value	Discounts to reflect current market conditions and estimated costs to sell	0-10%
Foreclosed real estate – non-covered		9,346	Appraised value	Discounts to reflect current market conditions, abbreviated holding period and estimated costs to sell	0-40%

For Level 3 assets and liabilities measured at fair value on a recurring or non-recurring basis as of December 31, 2013, the significant unobservable inputs used in the fair value measurements were as follows:

($ in thousands)
Description	Fair Value at December 31, 2013		Valuation Technique	Significant Unobservable Inputs	General Range of Significant Unobservable Input Values
Impaired loans – covered	$	15,284	Appraised value	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell	0-10%
Impaired loans – non-covered		13,020	Appraised value	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell	0-37%
Foreclosed real estate – covered		24,497	Appraised value	Discounts to reflect current market conditions and estimated costs to sell	0-10%
Foreclosed real estate – non-covered		12,251	Appraised value	Discounts to reflect current market conditions, abbreviated holding period and estimated costs to sell	0-40%

Schedule of the carrying amounts and estimated fair values of financial instruments

The carrying amounts and estimated fair values of financial instruments at June 30, 2014 and December 31, 2013 are as follows:

		June 30, 2014				December 31, 2013
($ in thousands)	Level in Fair Value Hierarchy	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Cash and due from banks, noninterest-bearing	Level 1	$	92,633		92,633		83,881		83,881
Due from banks, interest-bearing	Level 1		313,141		313,141		136,644		136,644
Federal funds sold	Level 1		1,508		1,508		2,749		2,749
Securities available for sale	Level 2		124,078		124,078		173,041		173,041
Securities held to maturity	Level 2		53,879		57,612		53,995		56,700
Presold mortgages in process of settlement	Level 1		5,926		5,926		5,422		5,422
Total loans, net of allowance	Level 3		2,388,589		2,330,633		2,414,689		2,352,834
Accrued interest receivable	Level 1		8,795		8,795		9,649		9,649
FDIC indemnification asset	Level 3		29,406		28,670		48,622		47,032
Bank-owned life insurance	Level 1		44,685		44,685		44,040		44,040
Deposits	Level 2		2,754,579		2,755,180		2,751,019		2,752,375
Borrowings	Level 2		116,394		101,928		46,394		34,795
Accrued interest payable	Level 2		778		778		879		879