Fair Value Measurements (Tables)
|
3 Months Ended |
Mar. 31, 2016 |
|---|
| Fair value measurements |
|
| Schedule of differences between the fair value carrying amount of mortgages held for sale measured at fair value and the aggregate unpaid principal amount |
The following table shows the differences between the fair value carrying amount of mortgages held for sale measured at fair value and the aggregate unpaid principal amount the Company is contractually entitled to receive at maturity. | | | | | | | | | | | | | | | | (Dollars in thousands) | | Fair value carrying amount | | Aggregate unpaid principal | | Excess of fair value carrying amount over (under) unpaid principal | | | March 31, 2016 | | |
| | |
| | |
| | | Mortgages held for sale reported at fair value | | $ | 11,999 |
| | $ | 11,826 |
| | $ | 173 |
| | (1) | | | | | | | | | | December 31, 2015 | | |
| | |
| | |
| | | Mortgages held for sale reported at fair value | | $ | 9,825 |
| | $ | 9,691 |
| | $ | 134 |
| | (1) |
| | (1) | The excess of fair value carrying amount over (under) unpaid principal is included in mortgage banking income and includes changes in fair value at and subsequent to funding and gains and losses on the related loan commitment prior to funding. |
|
| Schedule of assets and liabilities measured at fair value on a recurring basis |
The following table shows the balance of assets and liabilities measured at fair value on a recurring basis. | | | | | | | | | | | | | | | | | | (Dollars in thousands) | | Level 1 | | Level 2 | | Level 3 | | Total | March 31, 2016 | | |
| | |
| | |
| | |
| Assets: | | |
| | |
| | |
| | |
| Investment securities available-for-sale: | | |
| | |
| | |
| | |
| U.S. Treasury and Federal agencies securities | | $ | 19,998 |
| | $ | 374,072 |
| | $ | — |
| | $ | 394,070 |
| U.S. States and political subdivisions securities | | — |
| | 119,499 |
| | 4,810 |
| | 124,309 |
| Mortgage-backed securities — Federal agencies | | — |
| | 240,923 |
| | — |
| | 240,923 |
| Corporate debt securities | | — |
| | 34,575 |
| | — |
| | 34,575 |
| Foreign government and other securities | | — |
| | — |
| | 809 |
| | 809 |
| Total debt securities | | 19,998 |
| | 769,069 |
| | 5,619 |
| | 794,686 |
| Marketable equity securities | | 7,264 |
| | — |
| | — |
| | 7,264 |
| Total investment securities available-for-sale | | 27,262 |
| | 769,069 |
| | 5,619 |
| | 801,950 |
| Mortgages held for sale | | — |
| | 11,999 |
| | — |
| | 11,999 |
| Accrued income and other assets (interest rate swap agreements) | | — |
| | 14,766 |
| | — |
| | 14,766 |
| Total | | $ | 27,262 |
| | $ | 795,834 |
| | $ | 5,619 |
| | $ | 828,715 |
| | | | | | | | | | Liabilities: | | |
| | |
| | |
| | |
| Accrued expenses and other liabilities (interest rate swap agreements) | | $ | — |
| | $ | 15,045 |
| | $ | — |
| | $ | 15,045 |
| Total | | $ | — |
| | $ | 15,045 |
| | $ | — |
| | $ | 15,045 |
| | | | | | | | | | December 31, 2015 | | |
| | |
| | |
| | |
| Assets: | | |
| | |
| | |
| | |
| Investment securities available-for-sale: | | |
| | |
| | |
| | |
| U.S. Treasury and Federal agencies securities | | $ | 19,879 |
| | $ | 369,790 |
| | $ | — |
| | $ | 389,669 |
| U.S. States and political subdivisions securities | | — |
| | 118,462 |
| | 4,528 |
| | 122,990 |
| Mortgage-backed securities — Federal agencies | | — |
| | 236,297 |
| | — |
| | 236,297 |
| Corporate debt securities | | — |
| | 34,383 |
| | — |
| | 34,383 |
| Foreign government and other securities | | — |
| | — |
| | 809 |
| | 809 |
| Total debt securities | | 19,879 |
| | 758,932 |
| | 5,337 |
| | 784,148 |
| Marketable equity securities | | 7,579 |
| | — |
| | — |
| | 7,579 |
| Total investment securities available-for-sale | | 27,458 |
| | 758,932 |
| | 5,337 |
| | 791,727 |
| Mortgages held for sale | | — |
| | 9,825 |
| | — |
| | 9,825 |
| Accrued income and other assets (interest rate swap agreements) | | — |
| | 9,859 |
| | — |
| | 9,859 |
| Total | | $ | 27,458 |
| | $ | 778,616 |
| | $ | 5,337 |
| | $ | 811,411 |
| | | | | | | | | | Liabilities: | | |
| | |
| | |
| | |
| Accrued expenses and other liabilities (interest rate swap agreements) | | $ | — |
| | $ | 10,044 |
| | $ | — |
| | $ | 10,044 |
| Total | | $ | — |
| | $ | 10,044 |
| | $ | — |
| | $ | 10,044 |
|
|
| Schedule of changes in investment securities available-for-sale Level 3 assets measured at fair value on a recurring basis |
The following table shows changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the quarter ended March 31, 2016 and 2015. | | | | | | | | | | | | | | (Dollars in thousands) | | U.S. States and political subdivisions securities | | Foreign government and other securities | | Investment securities available-for-sale | Beginning balance January 1, 2016 | | $ | 4,528 |
| | $ | 809 |
| | $ | 5,337 |
| Total gains or losses (realized/unrealized): | | |
| | | | | Included in earnings | | — |
| | — |
| | — |
| Included in other comprehensive income | | 35 |
| | — |
| | 35 |
| Purchases | | 1,100 |
| | — |
| | 1,100 |
| Issuances | | — |
| | — |
| | — |
| Sales | | — |
| | — |
| | — |
| Settlements | | — |
| | — |
| | — |
| Maturities | | (853 | ) | | — |
| | (853 | ) | Transfers into Level 3 | | — |
| | — |
| | — |
| Transfers out of Level 3 | | — |
| | — |
| | — |
| Ending balance March 31, 2016 | | $ | 4,810 |
| | $ | 809 |
| | $ | 5,619 |
| | | | | | | | Beginning balance January 1, 2015 | | $ | 6,466 |
| | $ | 811 |
| | $ | 7,277 |
| Total gains or losses (realized/unrealized): | | |
| | | | | Included in earnings | | — |
| | — |
| | — |
| Included in other comprehensive income | | (7 | ) | | (3 | ) | | (10 | ) | Purchases | | — |
| | — |
| | — |
| Issuances | | — |
| | — |
| | — |
| Sales | | — |
| | — |
| | — |
| Settlements | | — |
| | — |
| | — |
| Maturities | | (827 | ) | | — |
| | (827 | ) | Transfers into Level 3 | | — |
| | — |
| | — |
| Transfers out of Level 3 | | — |
| | — |
| | — |
| Ending balance March 31, 2015 | | $ | 5,632 |
| | $ | 808 |
| | $ | 6,440 |
|
|
| Schedule of carrying value of assets measured at fair value on a non-recurring basis |
The following table shows the carrying value of assets measured at fair value on a non-recurring basis. | | | | | | | | | | | | | | | | | | (Dollars in thousands) | | Level 1 | | Level 2 | | Level 3 | | Total | March 31, 2016 | | |
| | |
| | |
| | |
| Impaired loans - collateral based | | $ | — |
| | $ | — |
| | $ | 720 |
| | $ | 720 |
| Accrued income and other assets (partnership investments) | | — |
| | — |
| | 512 |
| | 512 |
| Accrued income and other assets (mortgage servicing rights) | | — |
| | — |
| | 4,481 |
| | 4,481 |
| Accrued income and other assets (repossessions) | | — |
| | — |
| | 7,201 |
| | 7,201 |
| Accrued income and other assets (other real estate) | | — |
| | — |
| | 330 |
| | 330 |
| Total | | $ | — |
| | $ | — |
| | $ | 13,244 |
| | $ | 13,244 |
| | | | | | | | | | December 31, 2015 | | |
| | |
| | |
| | |
| Impaired loans - collateral based | | $ | — |
| | $ | — |
| | $ | 220 |
| | $ | 220 |
| Accrued income and other assets (partnership investments) | | — |
| | — |
| | 1,000 |
| | 1,000 |
| Accrued income and other assets (mortgage servicing rights) | | — |
| | — |
| | 4,608 |
| | 4,608 |
| Accrued income and other assets (repossessions) | | — |
| | — |
| | 6,927 |
| | 6,927 |
| Accrued income and other assets (other real estate) | | — |
| | — |
| | 736 |
| | 736 |
| Total | | $ | — |
| | $ | — |
| | $ | 13,491 |
| | $ | 13,491 |
|
|
| Schedule of fair values of financial instruments |
The following table shows the fair values of the Company’s financial instruments. | | | | | | | | | | | | | | | | | | | | | | (Dollars in thousands) | | Carrying or Contract Value | | Fair Value | | Level 1 | | Level 2 | | Level 3 | March 31, 2016 | | |
| | |
| | |
| | |
| | |
| Assets: | | |
| | |
| | |
| | |
| | |
| Cash and due from banks | | $ | 52,373 |
| | $ | 52,373 |
| | $ | 52,373 |
| | $ | — |
| | $ | — |
| Federal funds sold and interest bearing deposits with other banks | | 32,854 |
| | 32,854 |
| | 32,854 |
| | — |
| | — |
| Investment securities, available-for-sale | | 801,950 |
| | 801,950 |
| | 27,262 |
| | 769,069 |
| | 5,619 |
| Other investments | | 21,973 |
| | 21,973 |
| | 21,973 |
| | — |
| | — |
| Mortgages held for sale | | 11,999 |
| | 11,999 |
| | — |
| | 11,999 |
| | — |
| Loans and leases, net of reserve for loan and lease losses | | 3,942,679 |
| | 3,964,867 |
| | — |
| | — |
| | 3,964,867 |
| Mortgage servicing rights | | 4,481 |
| | 6,353 |
| | — |
| | — |
| | 6,353 |
| Interest rate swaps | | 14,766 |
| | 14,766 |
| | — |
| | 14,766 |
| | — |
| Liabilities: | | |
| | |
| | |
| | |
| | |
| Deposits | | $ | 4,225,148 |
| | $ | 4,231,877 |
| | $ | 3,016,933 |
| | $ | 1,214,944 |
| | $ | — |
| Short-term borrowings | | 181,914 |
| | 181,914 |
| | 171,495 |
| | 10,419 |
| | — |
| Long-term debt and mandatorily redeemable securities | | 68,837 |
| | 68,662 |
| | — |
| | 68,662 |
| | — |
| Subordinated notes | | 58,764 |
| | 49,377 |
| | — |
| | 49,377 |
| | — |
| Interest rate swaps | | 15,045 |
| | 15,045 |
| | — |
| | 15,045 |
| | — |
| Off-balance-sheet instruments * | | — |
| | 388 |
| | — |
| | 388 |
| | — |
| | | | | | | | | | | | December 31, 2015 | | |
| | |
| | |
| | |
| | |
| Assets: | | |
| | |
| | |
| | |
| | |
| Cash and due from banks | | $ | 65,171 |
| | $ | 65,171 |
| | $ | 65,171 |
| | $ | — |
| | $ | — |
| Federal funds sold and interest bearing deposits with other banks | | 14,550 |
| | 14,550 |
| | 14,550 |
| | — |
| | — |
| Investment securities, available-for-sale | | 791,727 |
| | 791,727 |
| | 27,458 |
| | 758,932 |
| | 5,337 |
| Other investments | | 21,973 |
| | 21,973 |
| | 21,973 |
| | — |
| | — |
| Mortgages held for sale | | 9,825 |
| | 9,825 |
| | — |
| | 9,825 |
| | — |
| Loans and leases, net of reserve for loan and lease losses | | 3,906,580 |
| | 3,927,967 |
| | — |
| | — |
| | 3,927,967 |
| Mortgage servicing rights | | 4,608 |
| | 7,246 |
| | — |
| | — |
| | 7,246 |
| Interest rate swaps | | 9,859 |
| | 9,859 |
| | — |
| | 9,859 |
| | — |
| Liabilities: | | |
| | |
| | |
| | |
| | |
| Deposits | | $ | 4,139,186 |
| | $ | 4,139,649 |
| | $ | 2,998,443 |
| | $ | 1,141,206 |
| | $ | — |
| Short-term borrowings | | 233,229 |
| | 233,229 |
| | 134,156 |
| | 99,073 |
| | — |
| Long-term debt and mandatorily redeemable securities | | 57,379 |
| | 57,193 |
| | — |
| | 57,193 |
| | — |
| Subordinated notes | | 58,764 |
| | 48,304 |
| | — |
| | 48,304 |
| | — |
| Interest rate swaps | | 10,044 |
| | 10,044 |
| | — |
| | 10,044 |
| | — |
| Off-balance-sheet instruments * | | — |
| | 375 |
| | — |
| | 375 |
| | — |
|
* Represents estimated cash outflows required to currently settle the obligations at current market rates. |
| Recurring |
|
| Fair value measurements |
|
| Schedule of valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on a recurring and non-recurring basis |
The following table shows the valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on a recurring basis. | | | | | | | | | | | | (Dollars in thousands) | | Fair Value | | Valuation Methodology | | Unobservable Inputs | | Range of Inputs | March 31, 2016 | | |
| | | | | | | Investment securities available-for sale | | |
| | | | | | | Direct placement municipal securities | | $ | 4,810 |
| | Discounted cash flows | | Credit spread assumption | | 0.72% - 1.60% | | | | | | | | | | Foreign government | | $ | 809 |
| | Discounted cash flows | | Market yield assumption | | 0.71% - 1.91% | | | | | | | | | | December 31, 2015 | | |
| | | | | | | Investment securities available-for sale | | |
| | | | | | | Direct placement municipal securities | | $ | 4,528 |
| | Discounted cash flows | | Credit spread assumption | | 1.27% - 2.03% | | | | | | | | | | Foreign government | | $ | 809 |
| | Discounted cash flows | | Market yield assumption | | 0.88% - 2.00% |
|
| Non-recurring |
|
| Fair value measurements |
|
| Schedule of valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on a recurring and non-recurring basis |
The following table below shows the valuation methodology and unobservable inputs for Level 3 assets and liabilities measured at fair value on a non-recurring basis. | | | | | | | | | | | | | | | | (Dollars in thousands) | | Carrying Value | | Fair Value | | Valuation Methodology | | Unobservable Inputs | | Range of Inputs | March 31, 2016 | | |
| | |
| | | | | | | Impaired loans | | $ | 720 |
| | $ | 720 |
| | Collateral based measurements including appraisals, trade publications, and auction values | | Discount for lack of marketability and current conditions | | 20% - 70% | | | | | | | | | | | | Mortgage servicing rights | | 4,481 |
| | 6,353 |
| | Discounted cash flows | | Constant prepayment rate (CPR) | | 12.1% - 17.0% | | | |
| | |
| | | | Discount rate | | 9.4% - 12.2% | | | | | | | | | | | | Repossessions | | 7,201 |
| | 7,378 |
| | Appraisals, trade publications and auction values | | Discount for lack of marketability | | 2% - 3% | | | | | | | | | | | | Other real estate | | 330 |
| | 373 |
| | Appraisals | | Discount for lack of marketability | | 0% - 20% | | | | | | | | | | | | December 31, 2015 | | |
| | |
| | | | | | | Impaired loans | | $ | 220 |
| | $ | 220 |
| | Collateral based measurements including appraisals, trade publications, and auction values | | Discount for lack of marketability and current conditions | | 20% | | | | | | | | | | | | Mortgage servicing rights | | 4,608 |
| | 7,246 |
| | Discounted cash flows | | Constant prepayment rate (CPR) | | 9.4% - 15.0% | | | |
| | |
| | | | Discount rate | | 9.8% - 13.3% | | | | | | | | | | | | Repossessions | | 6,927 |
| | 7,104 |
| | Appraisals, trade publications and auction values | | Discount for lack of marketability | | 2% - 3% | | | | | | | | | | | | Other real estate | | 736 |
| | 851 |
| | Appraisals | | Discount for lack of marketability | | 8% - 35% |
|