Estimated Fair Value of Financial Instruments and Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2018

Fair Value of Financial Assets and Liabilities Measured on Recurring Basis

The following table sets forth the Company’s financial assets that were accounted for at fair value on a recurring basis as of the periods presented by level within the fair value hierarchy. During the nine months ended September 30, 2018, the Company did not make any transfers between any levels within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:



	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value
	(in thousands)
September 30, 2018
Assets:
Investment securities, available for sale
U.S. Treasury and government agencies	$	4,884	$	139,590	$	—	$	144,474
Mortgage-backed securities	—		417,547		—		417,547
Obligations of states and political subdivisions	—		46,181		—		46,181
Other debt securities	—		5,041		—		5,041
Total securities available for sale	4,884		608,359		—		613,243
Equity securities, at fair value	2,996		13,042		—		16,038
Derivative assets	—		12,915		—		12,915
Total Assets	$	7,880	$	634,316	$	—	$	642,196
Liabilities:
Derivative liabilities	$	—	$	11,391	$	—	$	11,391
Total Liabilities	$	—	$	11,391	$	—	$	11,391

December 31, 2017
Assets:
Investment securities, available for sale
U.S. Treasury and government agencies	$	5,415	$	141,840	$	—	$	147,255
Mortgage-backed securities	—		424,331		—		424,331
Obligations of states and political subdivisions	—		51,320		—		51,320
Other debt securities	—		5,140		—		5,140
Total securities available for sale	5,415		622,631		—		628,046
Equity securities, at fair value	5,147		12,942		—		18,089
Derivative assets	—		6,555		—		6,555
Total Assets	$	10,562	$	642,128	$	—	$	652,690
Liabilities:
Derivative liabilities	$	—	$	5,465	$	—	$	5,465
Total Liabilities	$	—	$	5,465	$	—	$	5,465

Fair Value of Assets Measured on Non-recurring Basis

The following table sets forth the Company’s assets subject to fair value adjustments (impairment) on a non-recurring basis. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:



	(Level 1)		(Level 2)		(Level 3)		Total Fair Value
			(in thousands)
September 30, 2018
Assets:
Impaired loans and leases	$	—	$	—	$	18,380	$	18,380
Loans held for sale	—		1,340		—		1,340
Other real estate owned and other repossessed assets	—		—		2,754		2,754

December 31, 2017
Assets:
Impaired loans and leases	$	—	$	—	$	22,591	$	22,591
Loans held for sale	—		456		—		456
Other real estate owned and other repossessed assets	—		—		843		843

Carrying Values and Fair Values of Company's Financial Instruments

The following table presents the carrying values, fair values and placement in the fair value hierarchy of the Company’s financial instruments as of September 30, 2018 and December 31, 2017:



	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)
	(in thousands)
September 30, 2018
Financial Assets:
Investment securities held to maturity	$	158,576	$	153,975	$	—	$	147,576	$	6,399
Federal Home Loan Bank and other membership bank stocks	13,458		13,458		—		13,458		—
Loans and leases, net	4,290,825		4,264,827		—		—		4,264,827
Financial Liabilities:
Certificates of deposit	790,829		782,618		—		782,618		—
Other borrowings	184,640		180,875		—		180,875		—
Subordinated debentures	104,995		103,146		—		—		103,146
December 31, 2017
Financial Assets:
Investment securities held to maturity	$	139,685	$	138,688	$	—	$	127,901	$	10,787
Federal Home Loan Bank and other membership bank stocks	12,576		12,576		—		12,576		—
Loans and leases, net	4,117,265		4,114,516		—		—		4,114,516
Financial Liabilities:
Certificates of deposit	737,428		732,417		—		732,417		—
Other borrowings	192,011		189,080		—		189,080		—
Subordinated debentures	104,902		97,244		—		—		97,244