(12) Fair Value Measurements

Fair value is defined by applicable accounting guidance as the price to sell an asset or transfer a liability in an orderly transaction between market participants in the principal market for the given asset or liability at the measurement date based on market conditions at that date. Certain assets and liabilities are recorded in the Company’s financial statements at fair value. Some are recorded on a recurring basis and some on a non-recurring basis.

For some assets and liabilities, observable market transactions and market information might be available. For other assets and liabilities, observable market transactions and market information might not be available. A hierarchy for fair value has been established which categorizes into three levels the inputs to valuation techniques used to measure fair value. The three levels are as follows:

Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) - fair value is based on unadjusted quoted prices in active markets for identical assets or liabilities.

Significant Other Observable Inputs (Level 2) - Fair value is based on significant other observable inputs which are generally determined based on a single price for each financial instrument provided to us by an applicable third-party pricing service and is based on one or more of the following:


•	Quoted prices for similar, but not identical, assets or liabilities in active markets;


•	Quoted prices for identical or similar assets or liabilities in inactive markets;


•	Inputs other than quoted prices that are observable, such as interest rate and yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates;


•	Other inputs derived from or corroborated by observable market inputs.

Significant Unobservable Inputs (Level 3) - Fair value is based upon model-based valuation techniques for which at least one significant assumption is not observable in the market.

Transfers between levels are recognized as of the end of the reporting period. There were no transfers in or out of quoted prices in active markets for identical instruments, significant other observable inputs or significant unobservable inputs during the three months ended March 31, 2014 and 2013, respectively.

The underlying methods used by the third-party pricing services are considered in determining the primary inputs used to determine fair values. Management has evaluated the methodologies employed by the third-party pricing services by comparing the price provided by the pricing service with other sources, including brokers' quotes, sales or purchases of similar instruments and discounted cash flows to establish a basis for reliance on the pricing service values. Significant differences between the pricing service provided value and other sources are discussed with the pricing service to understand the basis for their values. Based on all observable inputs, management may adjust prices obtained from third-party pricing services to more appropriately reflect the prices that would be received to sell assets or paid to transfer liabilities in orderly transactions in the current market. No significant adjustments were made to prices provided by third-party pricing services at March 31, 2014, December 31, 2013 or March 31, 2013.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The fair value of financial assets and liabilities that are measured on a recurring basis is as follows as of March 31, 2014 (in thousands):



	Total		Quoted Prices in Active Markets for Identical Instruments		Significant Other Observable Inputs		Significant Unobservable Inputs
Assets:
Trading securities:
U.S. Government agency debentures	$	28,588	$	—	$	28,588	$	—
U.S. agency residential mortgage-backed securities	23,595		—		23,595		—
Municipal and other tax-exempt securities	27,280		—		27,280		—
Other trading securities	7,108		—		7,108		—
Total trading securities	86,571		—		86,571		—
Available for sale securities:
U.S. Treasury	1,034		1,034		—		—
Municipal and other tax-exempt	70,065		—		54,542		15,523
U.S. agency residential mortgage-backed securities	7,475,569		—		7,475,569		—
Privately issued residential mortgage-backed securities	189,248		—		189,248		—
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,123,762		—		2,123,762		—
Other debt securities	35,119		—		30,407		4,712
Perpetual preferred stock	24,281		—		24,281		—
Equity securities and mutual funds	14,645		—		14,645		—
Total available for sale securities	9,933,723		1,034		9,912,454		20,235
Fair value option securities:
U.S. agency residential mortgage-backed securities	156,525		—		156,525		—
Other securities	4,359		—		4,359		—
Total fair value option securities	160,884		—		160,884		—
Residential mortgage loans held for sale	226,512		—		226,512		—
Mortgage servicing rights¹	153,774		—		—		153,774
Derivative contracts, net of cash margin²	218,507		1,363		217,144		—
Other assets – private equity funds	27,466		—		—		27,466
Liabilities:
Derivative contracts, net of cash margin²	185,499		—		185,499		—


¹	A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 6, Mortgage Banking Activities.

See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts in asset positions that were valued based on quoted prices in active markets for identical instruments (Level 1) are exchange-traded energy and interest rate derivative contacts, net of cash margin. Derivative contacts in liability positions that were valued using quoted prices in active market for identical instruments are exchange-traded energy, agricultural and interest rate derivative contracts that were fully offset by cash margin.

The fair value of financial assets and liabilities that are measured on a recurring basis is as follows as of December 31, 2013 (in thousands):



	Total		Quoted Prices in Active Markets for Identical Instruments		Significant Other Observable Inputs		Significant Unobservable Inputs
Assets:
Trading securities:
U.S. Government agency debentures	$	34,120	$	—	$	34,120	$	—
U.S. agency residential mortgage-backed securities	21,011		—		21,011		—
Municipal and other tax-exempt securities	27,350		—		27,350		—
Other trading securities	9,135		—		9,135		—
Total trading securities	91,616		—		91,616		—
Available for sale securities:
U.S. Treasury	1,042		1,042		—		—
Municipal and other tax-exempt	73,775		—		55,970		17,805
U.S. agency residential mortgage-backed securities	7,716,010		—		7,716,010		—
Privately issued residential mortgage-backed securities	221,099		—		221,099		—
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,055,804		—		2,055,804		—
Other debt securities	35,241		—		30,529		4,712
Perpetual preferred stock	22,863		—		22,863		—
Equity securities and mutual funds	21,328		—		17,121		4,207
Total available for sale securities	10,147,162		1,042		10,119,396		26,724
Fair value option securities:
U.S. agency residential mortgage-backed securities	157,431		—		157,431		—
Other securities	9,694		—		9,694		—
Total fair value option securities	167,125		—		167,125		—
Residential mortgage loans held for sale	200,546		—		200,546		—
Mortgage servicing rights¹	153,333		—		—		153,333
Derivative contracts, net of cash margin²	265,012		2,712		262,300		—
Other assets – private equity funds	27,341		—		—		27,341
Liabilities:
Derivative contracts, net of cash margin ²	247,185		—		247,185		—


¹	A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 6, Mortgage Banking Activities.


²	See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts based on quoted prices in active markets for identical instruments (Level 1) are exchange-traded energy derivative contacts, net of cash margin.

The fair value of financial assets and liabilities that are measured on a recurring basis is as follows as of March 31, 2013 (in thousands):



	Total		Quoted Prices in Active Markets for Identical Instruments		Significant Other Observable Inputs		Significant Unobservable Inputs
Assets:
Trading securities:
U.S. Government agency debentures	$	55,358	$	—	$	55,358	$	—
U.S. agency residential mortgage-backed securities	33,106		—		33,106		—
Municipal and other tax-exempt securities	90,710		—		90,710		—
Other trading securities	27,424		—		27,424		—
Total trading securities	206,598		—		206,598		—
Available for sale securities:
U.S. Treasury	1,000		1,000		—		—
Municipal and other tax-exempt	85,447		—		46,440		39,007
U.S. agency residential mortgage-backed securities	9,165,212		—		9,165,212		—
Privately issued residential mortgage-backed securities	316,208		—		316,208		—
Commercial mortgage-backed securities guaranteed by U.S. government agencies	1,405,346		—		1,405,346		—
Other debt securities	36,079		—		30,886		5,193
Perpetual preferred stock	26,832		—		26,832		—
Equity securities and mutual funds	23,021		4,571		15,978		2,472
Total available for sale securities	11,059,145		5,571		11,006,902		46,672
Fair value option securities:
U.S. agency residential mortgage-backed securities	208,900		—		208,900		—
Other securities	1,292		—		1,292		—
Total fair value option securities	210,192		—		210,192		—
Residential mortgage loans held for sale	286,211		—		286,211		—
Mortgage servicing rights¹	109,840		—		—		109,840
Derivative contracts, net of cash margin ²	320,473		457		320,016		—
Other assets – private equity funds	29,216		—		—		29,216
Liabilities:
Derivative contracts, net of cash margin ²	251,836		—		251,836		—


¹	A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 6, Mortgage Banking Activities.


²	See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts based on quoted prices in active markets for identical instruments (Level 1) are exchange-traded energy and agricultural derivative contacts, net of cash margin.

Following is a description of the Company's valuation methodologies used for assets and liabilities measured on a recurring basis:

Securities

The fair values of trading, available for sale and fair value option securities are based on quoted prices for identical instruments in active markets, when available. If quoted prices for identical instruments are not available, fair values are based on significant other observable inputs such as quoted prices of comparable instruments or interest rates and credit spreads, yield curves, volatilities, prepayment speeds and loss severities.

The fair value of certain available for sale municipal and other debt securities may be based on significant unobservable inputs. These significant unobservable inputs include limited observed trades, projected cash flows, current credit rating of the issuers and, when applicable, the insurers of the debt and observed trades of similar debt. Discount rates are primarily based on reference to interest rate spreads on comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies adjusted for a lack of trading volume. Significant unobservable inputs are developed by investment securities professionals involved in the active trading of similar securities. A summary of significant inputs used to value these securities follows. A management committee composed of senior members from the Company's Capital Markets, Risk Management and Finance departments assess the appropriateness of these inputs monthly.

Derivatives

All derivative instruments are carried on the balance sheet at fair value. Fair values for exchange-traded contracts are based on quoted prices. Fair values for over-the-counter interest rate, commodity and foreign exchange contracts are based on valuations provided either by third-party dealers in the contracts, quotes provided by independent pricing services, or a third-party provided pricing model that uses significant other observable market inputs.

Credit risk is considered in determining the fair value of derivative instruments. Management determines fair value adjustments based on various risk factors including but not limited to counterparty credit rating or equivalent loan grading, derivative contract notional size, price volatility of the underlying commodity, duration of the derivative contracts and expected loss severity. Expected loss severity is based on historical losses for similarly risk graded commercial loan customers. Decreases in counterparty credit rating or grading and increases in price volatility and expected loss severity all tend to increase the credit quality adjustment which reduces the fair value of asset contracts. The reduction in fair value is recognized in earnings during the current period.

We also consider our own credit risk in determining the fair value of derivative contracts. Changes in our credit rating would affect the fair value of our derivative liabilities. In the event of a credit downgrade, the fair value of our derivative liabilities would increase. The change in the fair value would be recognized in earnings in the current period.

Residential Mortgage Loans Held for Sale

Residential mortgage loans held for sale are carried on the balance sheet at fair value. The fair values of residential mortgage loans held for sale are based upon quoted market prices of such loans sold in securitization transactions, including related unfunded loan commitments.

Other Assets - Private Equity Funds

The fair value of the portfolio investments of the Company's two private equity funds are based upon net asset value reported by the underlying funds, as adjusted by the general partner when necessary to represent the price that would be received to sell the assets. The Company's private equity funds provide customers alternative investment opportunities as limited partners of the funds. As fund of funds, the private equity funds invest in other limited partnerships or limited liability companies that invest substantially all of their assets in U.S. companies pursuing diversified investment strategies including early-stage venture capital, distressed securities and corporate or asset buy-outs. Private equity fund assets are long-term, illiquid investments. No secondary market exists for these assets. The private equity funds typically invest in funds that provide no redemption rights to investors. The fair value of the private equity investments may only be realized through cash distributions from the underlying funds.

The following represents the changes for the three months ended March 31, 2014 related to assets measured at fair value on a recurring basis using significant unobservable inputs (in thousands):



	Available for Sale Securities
	Municipal and other tax-exempt			Other debt securities		Equity securities and mutual funds			Other assets – private equity funds
Balance, December 31, 2013	$	17,805		$	4,712	$	4,207		$	27,341
Transfer to Level 3 from Level 2	—			—		—			—
Purchases and capital calls	—			—		—			205
Redemptions and distributions	(2,322		)	—		—			(1,105		)
Gain (loss) recognized in earnings:
Gain on other assets, net	—			—		—			1,025
Gain on available for sale securities, net	(78		)	—		—			—
Other-than-temporary impairment losses	—			—		—			—
Charitable contributions to BOKF Foundation	—			—		(2,420		)	—
Other comprehensive gain (loss)	118			—		(1,787		)	—
Balance, March 31, 2014	$	15,523		$	4,712	$	—		$	27,466

The following represents the changes for the three months ended March 31, 2013 related to assets measured at fair value on a recurring basis using significant unobservable inputs (in thousands):



	Available for Sale Securities
	Municipal and other tax-exempt			Other debt securities			Equity securities and mutual funds		Other assets – private equity funds
Balance, December 31, 2012	$	40,702		$	5,399		$	2,161	$	28,169
Transfer to Level 3 from Level 2	—			—			—		—
Purchases, and capital calls	—			—			—		492
Redemptions and distributions	(98		)	—			—		(830		)
Gain (loss) recognized in earnings
Gain on other assets, net	—			—			—		1,385
Gain on available for sale securities, net	—			—			—		—
Other-than-temporary impairment losses	—			—			—		—
Other comprehensive (loss)	(1,597		)	(206		)	311		—
Balance, March 31, 2013	$	39,007		$	5,193		$	2,472	$	29,216

A summary of quantitative information about assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) as of March 31, 2014 follows (in thousands):

Quantitative Information about Level 3 Recurring Fair Value Measurements

Par

Value

Amortized

Cost

Fair

Value

Valuation Technique(s)

Unobservable Input

Range

(Weighted Average)

Available for sale securities

Municipal and other tax-exempt securities

16,295

16,224

15,523

Discounted cash flows

Interest rate spread

4.95%-5.25% (5.13%)

95.05%-95.49% (95.26%)

Other debt securities

4,900

4,712

Discounted cash flows

Interest rate spread

5.46%-5.66% (5.63%)

⁴

96.16% (96.16%)

Other assets - private equity funds

N/A

27,466

Net asset value reported by underlying fund

N/A


¹	Discounted cash flows developed using discount rates primarily based on reference to interest rate spreads for comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies, adjusted for lack of trading volume


²	Interest rate yields used to value investment grade tax-exempt securities represent a spread of 468 to 515 basis points over average yields for comparable tax-exempt securities.


³	Represents fair value as a percentage of par value


⁴	Interest rate yields used to value investment grade taxable securities based on comparable short-term taxable securities which are generally yielding less than 1%.

The fair value of these securities measured at fair value using significant unobservable inputs are sensitive primarily to changes in interest rate spreads. At March 31, 2014, for tax-exempt securities rated investment grade by all nationally-recognized rating agencies, a 100 basis point increase in the spreads over average yields for comparable securities would result in an additional decrease in the fair value of $150 thousand. For taxable securities rated investment grade by all nationally-recognized rating agencies, a 100 basis point increase in the spreads over average yield for comparable securities would result in an additional decrease in the fair value of $45 thousand. For municipal and other tax-exempt securities rated below investment grade by at least one of the nationally-recognized rating agencies, a 100 basis point increase in the spread over average yields for comparable securities would significantly change the fair value of these securities.

A summary of quantitative information about Recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of December 31, 2013 follows (in thousands):

Quantitative Information about Level 3 Recurring Fair Value Measurements

Par

Value

Amortized

Cost

Fair

Value

Valuation Technique(s)

Unobservable Input

Range

(Weighted Average)

Available for sale securities

Municipal and other tax-exempt securities

18,695

18,624

17,805

Discounted cash flows

Interest rate spread

4.97%-5.27% (5.16%)

95.02%-95.50% (95.24%)

Other debt securities

4,900

4,712

Discounted cash flows

Interest rate spread

5.67% (5.67%)

⁴

96.16% (96.16%)

Equity securities and mutual funds

N/A

2,420

4,207

Publicly announced preliminary purchase price information from acquirer.

Discount for settlement uncertainty.

N/A

⁵

Other assets - private equity funds

N/A

27,341

Net asset value reported by underlying fund

N/A


¹	Discounted cash flows developed using discount rates primarily based on reference to interest rate spreads for comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies, adjusted for lack of trading volume


²	Interest rate yields used to value investment grade tax-exempt securities represent a spread of 467 to 518 basis points over average yields for comparable tax-exempt securities.


³	Represents fair value as a percentage of par value


⁴	Interest rate yields used to value investment grade taxable securities based on comparable short-term taxable securities which are generally yielding less than 1%.


⁵	Fair value of shares of a smaller privately-held financial institution were valued using preliminary announced purchase information by a publicly-traded acquirer.

A summary of quantitative information about Recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of March 31, 2013 follows (in thousands):

Quantitative Information about Level 3 Recurring Fair Value Measurements

Par

Value

Amortized

Cost⁶

Fair

Value

Valuation Technique(s)

Unobservable Input

Range

(Weighted Average)

Available for sale securities

Municipal and other tax-exempt securities

Investment grade

28,470

28,374

27,120

Discounted cash flows

Interest rate spread

5.00%-5.50% (5.25%)

95.01%-95.59% (95.26%)

Below investment grade

17,000

12,384

11,887

Discounted cash flows

Interest rate spread

8.80%-11.20% (9.54%)

⁴

69.86%-70.04% (69.92%)

Total municipal and other tax-exempt securities

45,470

40,758

39,007

Other debt securities

5,400

5,193

Discounted cash flows

Interest rate spread

5.44%-5.71% (5.68%)

⁵

96.16% (96.16%)

Equity securities and mutual funds

N/A

2,420

2,472

Tangible book value per share of publicly traded financial institutions of similar size, less liquidity discount.

Peer group tangible book per share and liquidity discount.

N/A

⁷

Other assets - private equity funds

N/A

29,216

Net asset value reported by underlying fund

N/A


¹	Discounted cash flows developed using discount rates primarily based on reference to interest rate spreads for comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies, adjusted for lack of trading volume


²	Interest rate yields used to value investment grade tax-exempt securities represent a spread of 458 to 519 basis points over average yields for comparable tax-exempt securities.


³	Represents fair value as a percentage of par value


⁴	Interest rate yields determined using a spread of 700 basis points over comparable municipal securities of varying durations.


⁵	Interest rate yields used to value investment grade taxable securities based on comparable short-term taxable securities which are generally yielding less than 1%.


⁶	Amortized cost reduced by other-than-temporary impairments recorded in earnings. See Note 2 for additional discussion.


⁷	Fair value of shares of a smaller privately-held financial institution were valued using the tangible book value per share of similarly sized financial institutions within the immediate geographical market with a discount of 20% due to the liquidity of the shares.

Fair Value of Assets and Liabilities Measured on a Non-Recurring Basis

Assets measured at fair value on a non-recurring basis include collateral for certain impaired loans and real property and other assets acquired to satisfy loans, which are based primarily on comparisons to completed sales of similar assets.

The following represents the carrying value of assets measured at fair value on a non-recurring basis (and related losses) during the period. The carrying value represents only those assets with a balance at March 31, 2014 for which the fair value was adjusted during the three months ended March 31, 2014:



							Fair Value Adjustments for the
	Carrying Value at March 31, 2014						Three Months Ended March 31, 2014 Recognized in:
	Quoted Prices in Active Markets for Identical Instruments		Significant Other Observable Inputs		Significant Unobservable Inputs		Gross charge-offs against allowance for loan losses		Net losses and expenses of repossessed assets, net
Impaired loans	$	—	$	3,015	$	1,541	$	953	$	—
Real estate and other repossessed assets	—		4,833		—		—		1,251

The following represents the carrying value of assets measured at fair value on a non-recurring basis (and related losses) during the period. The carrying value represents only those assets with a balance at March 31, 2013 for which the fair value was adjusted during the three months ended March 31, 2013:



							Fair Value Adjustments for the
	Carrying Value at March 31, 2013						Three Months Ended March 31, 2013 Recognized in:
	Quoted Prices in Active Markets for Identical Instruments		Significant Other Observable Inputs		Significant Unobservable Inputs		Gross charge-offs against allowance for loan losses		Net losses and expenses of repossessed assets, net
Impaired loans	$	—	$	14,448	$	2,197	$	7,485	$	—
Real estate and other repossessed assets	—		5,166		607		—		661

The fair value of collateral-dependent impaired loans and real estate and other repossessed assets and the related fair value adjustments are generally based on unadjusted third-party appraisals. Our appraisal review policies require appraised values to be supported by observed inputs derived principally from or corroborated by observable market data. Appraisals that are not based on observable inputs or that require significant adjustments or fair value measurements that are not based on third-party appraisals are considered to be based on significant unobservable inputs. Non-recurring fair value measurements of collateral-dependent impaired loans and real estate and other repossessed assets based on significant unobservable inputs are generally due to estimates of current fair values between appraisal dates. Significant unobservable inputs include listing prices for the same or comparable assets, uncorroborated expert opinions or management's knowledge of the collateral or industry. These inputs are developed by asset management and workout professionals and approved by senior Credit Administration executives.

A summary of quantitative information about Non-recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of March 31, 2014 follows (in thousands):



Quantitative Information about Level 3 Non-recurring Fair Value Measurements
	Fair Value		Valuation Technique(s)	Unobservable Input	Range (Weighted Average)
Impaired loans	$	1,541	Appraised value, as adjusted	Broker quotes and management's knowledge of industry and collateral.	N/A

A summary of quantitative information about Non-recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of March 31, 2013 follows (in thousands):



Quantitative Information about Level 3 Non-recurring Fair Value Measurements
	Fair Value		Valuation Technique(s)	Unobservable Input	Range (Weighted Average)
Impaired loans	$	2,197	Appraised value, as adjusted	Broker quotes and management's knowledge of industry and collateral.	N/A
Real estate and other repossessed assets	607		Listing value, less cost to sell	Marketability adjustments off appraised value	73%-85% (77%)¹


¹	Marketability adjustments include consideration of estimated costs to sell which is approximately 15% of fair value.

Fair Value of Financial Instruments

The following table presents the carrying values and estimated fair values of all financial instruments, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis as of March 31, 2014 (dollars in thousands):



	Carrying Value			Range of Contractual Yields	Average Re-pricing (in years)	Discount Rate		Estimated Fair Value
Cash and due from banks	$	645,435						$	645,435
Interest-bearing cash and cash equivalents	708,571							708,571
Trading securities:
U.S. Government agency debentures	28,588							28,588
U.S. agency residential mortgage-backed securities	23,595							23,595
Municipal and other tax-exempt securities	27,280							27,280
Other trading securities	7,108							7,108
Total trading securities	86,571							86,571
Investment securities:
Municipal and other tax-exempt	440,303							441,532
U.S. agency residential mortgage-backed securities	45,917							47,834
Other debt securities	182,756							195,697
Total investment securities	668,976							685,063
Available for sale securities:
U.S. Treasury	1,034							1,034
Municipal and other tax-exempt	70,065							70,065
U.S. agency residential mortgage-backed securities	7,475,569							7,475,569
Privately issued residential mortgage-backed securities	189,248							189,248
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,123,762							2,123,762
Other debt securities	35,119							35,119
Perpetual preferred stock	24,281							24,281
Equity securities and mutual funds	14,645							14,645
Total available for sale securities	9,933,723							9,933,723
Fair value option securities:
U.S. agency residential mortgage-backed securities	156,525							156,525
Other securities	4,359							4,359
Total fair value option securities	160,884							160,884
Residential mortgage loans held for sale	226,512							226,512
Loans:
Commercial	8,051,706			0.15% - 30.00%	0.52	0.55% - 4.28%		7,941,638
Commercial real estate	2,631,407			0.38% - 18.00%	0.74	1.15% - 3.54%		2,609,622
Residential mortgage	2,018,675			0.01% - 18.00%	2.60	0.57% - 4.54%		2,040,336
Consumer	376,066			0.38% - 21.00%	0.50	1.14% - 3.80%		370,885
Total loans	13,077,854							12,962,481
Allowance for loan losses	(188,318		)					—
Net loans	12,889,536							12,962,481
Mortgage servicing rights	153,774							153,774
Derivative instruments with positive fair value, net of cash margin	218,507							218,507
Other assets – private equity funds	27,466							27,466
Deposits with no stated maturity	17,727,539							17,727,539
Time deposits	2,662,174			0.03% - 9.64%	2.08	0.74% - 1.32%		2,664,770
Other borrowed funds	2,974,979			0.23% - 4.50%	0.11	0.06% - 2.62%		2,960,177
Subordinated debentures	347,846			0.95% - 5.00%	2.40	2.21	%	344,717
Derivative instruments with negative fair value, net of cash margin	185,499							185,499



	Carrying Value			Range of Contractual Yields	Average Re-pricing (in years)	Discount Rate		Estimated Fair Value
Cash and due from banks	$	512,931						$	512,931
Interest-bearing cash and cash equivalents	574,282							574,282
Trading securities:
U.S. Government agency debentures	34,120							34,120
U.S. agency residential mortgage-backed securities	21,011							21,011
Municipal and other tax-exempt securities	27,350							27,350
Other trading securities	9,135							9,135
Total trading securities	91,616							91,616
Investment securities:
Municipal and other tax-exempt	440,187							439,870
U.S. agency residential mortgage-backed securities	50,182							51,864
Other debt securities	187,509							195,393
Total investment securities	677,878							687,127
Available for sale securities:
U.S. Treasury	1,042							1,042
Municipal and other tax-exempt	73,775							73,775
U.S. agency residential mortgage-backed securities	7,716,010							7,716,010
Privately issued residential mortgage-backed securities	221,099							221,099
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,055,804							2,055,804
Other debt securities	35,241							35,241
Perpetual preferred stock	22,863							22,863
Equity securities and mutual funds	21,328							21,328
Total available for sale securities	10,147,162							10,147,162
Fair value option securities:
U.S. agency residential mortgage-backed securities	157,431							157,431
Other securities	9,694							9,694
Total fair value option securities	167,125							167,125
Residential mortgage loans held for sale	200,546							200,546
Loans:
Commercial	7,943,221			0.04% - 30.00%	0.49	0.48% - 4.33%		7,835,325
Commercial real estate	2,415,353			0.38% - 18.00%	0.78	1.21% - 3.49%		2,394,443
Residential mortgage	2,052,026			0.38% - 18.00%	2.63	0.59% - 4.73%		2,068,690
Consumer	381,664			0.38% - 21.00%	0.55	1.22% - 3.75%		375,962
Total loans	12,792,264							12,674,420
Allowance for loan losses	(185,396		)					—
Net loans	12,606,868							12,674,420
Mortgage servicing rights	153,333							153,333
Derivative instruments with positive fair value, net of cash margin	265,012							265,012
Other assets – private equity funds	27,341							27,341
Deposits with no stated maturity	17,573,334							17,573,334
Time deposits	2,695,993			0.01% - 9.64%	2.12	0.75% - 1.33%		2,697,290
Other borrowed funds	2,721,888			0.25% - 4.78%	0.03	0.08% - 2.64%		2,693,788
Subordinated debentures	347,802			0.95% - 5.00%	2.63	2.22	%	344,783
Derivative instruments with negative fair value, net of cash margin	247,185							247,185



	Carrying Value			Range of Contractual Yields	Average Re-pricing (in years)	Discount Rate		Estimated Fair Value
Cash and due from banks	$	458,471						$	458,471
Interest-bearing cash and cash equivalents	487,146							487,146
Trading securities:
U.S. Government agency debentures	55,358							55,358
U.S. agency residential mortgage-backed securities	33,106							33,106
Municipal and other tax-exempt securities	90,710							90,710
Other trading securities	27,424							27,424
Total trading securities	206,598							206,598
Investment securities:
Municipal and other tax-exempt	339,003							341,940
U.S. agency residential mortgage-backed securities	72,968							76,851
Other debt securities	177,300							196,403
Total investment securities	589,271							615,194
Available for sale securities:
U.S. Treasury	1,000							1,000
Municipal and other tax-exempt	85,447							85,447
U.S. agency residential mortgage-backed securities	9,165,212							9,165,212
Privately issued residential mortgage-backed securities	316,208							316,208
Commercial mortgage-backed securities guaranteed by U.S. government agencies	1,405,346							1,405,346
Other debt securities	36,079							36,079
Perpetual preferred stock	26,832							26,832
Equity securities and mutual funds	23,021							23,021
Total available for sale securities	11,059,145							11,059,145
Fair value option securities:
U.S. agency residential mortgage-backed securities	208,900							208,900
Other securities	1,292							1,292
Total fair value option securities	210,192							210,192
Residential mortgage loans held for sale	286,211							286,211
Loans:
Commercial	7,418,305			0.25% - 30.00%	0.66	0.55% - 3.69%		7,372,375
Commercial real estate	2,285,160			0.38% - 18.00%	0.84	1.19% - 3.21%		2,266,433
Residential mortgage	2,012,450			0.38% - 18.00%	3.53	0.74% - 3.29%		2,062,801
Consumer	377,649			0.38% - 21.00%	0.31	1.28% - 3.53%		371,771
Total loans	12,093,564							12,073,380
Allowance for loan losses	(205,965		)					—
Net loans	11,887,599							12,073,380
Mortgage servicing rights	109,840							109,840
Derivative instruments with positive fair value, net of cash margin	320,473							320,473
Other assets – private equity funds	29,216							29,216
Deposits with no stated maturity	16,960,237							16,960,237
Time deposits	2,900,054			0.03% - 9.64%	2.14	0.78% - 1.15%		2,958,570
Other borrowed funds	3,393,416			0.13% - 5.25%	—	0.13% - 2.67%		3,398,902
Subordinated debentures	347,674			0.98% - 5.00%	3.33	2.22	%	345,527
Derivative instruments with negative fair value, net of cash margin	251,836							251,836

Because no market exists for certain of these financial instruments and management does not intend to sell these financial instruments, the fair values shown in the tables above may not represent values at which the respective financial instruments could be sold individually or in the aggregate at the given reporting date.

The following methods and assumptions were used in estimating the fair value of these financial instruments:

Cash and Cash Equivalents

The book value reported in the consolidated balance sheets for cash and short-term instruments approximates those assets’ fair values.

Securities

The fair values of securities are generally based on Significant Other Observable Inputs such as quoted prices for comparable instruments or interest rates and credit spreads, yield curves, volatilities, prepayment speeds and loss severities.

Loans

The fair value of loans, excluding loans held for sale, are based on discounted cash flow analyses using interest rates and credit and liquidity spreads currently being offered for loans with similar remaining terms to maturity and risk, adjusted for the impact of interest rate floors and ceilings which are classified as Significant Unobservable Inputs. The fair values of loans were estimated to approximate their discounted cash flows less loan loss allowances allocated to these loans of $161 million at March 31, 2014, $157 million at December 31, 2013 and $163 million at March 31, 2013.

Deposits

The fair values of time deposits are based on discounted cash flow analyses using interest rates currently being offered on similar transactions which are considered Significant Unobservable Inputs. Estimated fair value of deposits with no stated maturity, which includes demand deposits, transaction deposits, money market deposits and savings accounts, is equal to the amount payable on demand. Although market premiums paid reflect an additional value for these low cost deposits, adjusting fair value for the expected benefit of these deposits is prohibited. Accordingly, the positive effect of such deposits is not included in the tables above.

Other Borrowings and Subordinated Debentures

The fair values of these instruments are based upon discounted cash flow analyses using interest rates currently being offered on similar instruments which are considered Significant Unobservable Inputs.

Off-Balance Sheet Instruments

The fair values of commercial loan commitments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements. The fair values of these off-balance sheet instruments were not significant at March 31, 2014, December 31, 2013 or March 31, 2013.

Fair Value Election

As more fully disclosed in Note 2 and Note 6 to the Consolidated Financial Statements, the Company has elected to carry all residential mortgage-backed securities which have been designated as economic hedges against changes in the fair value of mortgage servicing rights, certain corporate debt securities economically hedged by derivative contracts to manage interest rate risk and all residential mortgage loans originated for sale at fair value. Changes in the fair value of these financial instruments are recognized in earnings.