Fair Value Disclosures (Tables)

3 Months Ended

Mar. 31, 2016

Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table presents the assets and liabilities measured at fair value on a recurring basis at March 31, 2016 and December 31, 2015, classified using the fair value hierarchy:



	At March 31, 2016
(Dollars in thousands)	Level 1		Level 2		Level 3		Assets/ Liabilities at Fair Value
Assets:
Available-for-sale securities:
U.S. government corporations and agencies	$	—	$	67,667	$	—	$	67,667
State and political subdivisions	—		102,808		—		102,808
Residential mortgage-backed securities	—		8,574		—		8,574
Collateralized mortgage obligations	—		3,056		—		3,056
Corporate bonds	—		92,003		—		92,003
Money market mutual funds	17,563		—		—		17,563
Equity securities	754		—		—		754
Total available-for-sale securities	18,317		274,108		—		292,425
Interest rate locks with customers	—		1,721		—		1,721
Total assets	$	18,317	$	275,829	$	—	$	294,146
Liabilities:
Contingent consideration liability	$	—	$	—	$	4,957	$	4,957
Interest rate swap	—		983		—		983
Forward loan sale commitments	—		243		—		243
Total liabilities	$	—	$	1,226	$	4,957	$	6,183



	At December 31, 2015
(Dollars in thousands)	Level 1		Level 2		Level 3		Assets/ Liabilities at Fair Value
Assets:
Available-for-sale securities:
U.S. treasuries	$	4,887	$	—	$	—	$	4,887
U.S. government corporations and agencies	—		102,156		—		102,156
State and political subdivisions	—		102,032		—		102,032
Residential mortgage-backed securities	—		13,354		—		13,354
Collateralized mortgage obligations	—		3,133		—		3,133
Corporate bonds	—		86,675		—		86,675
Money market mutual funds	16,726		—		—		16,726
Equity securities	807		—		—		807
Total available-for-sale securities	22,420		307,350		—		329,770
Interest rate locks with customers	—		1,089		—		1,089
Total assets	$	22,420	$	308,439	$	—	$	330,859
Liabilities:
Contingent consideration liability	$	—	$	—	$	5,577	$	5,577
Interest rate swap	—		438		—		438
Forward loan sale commitments	—		102		—		102
Total liabilities	$	—	$	540	$	5,577	$	6,117

Contingent Consideration Liability Change in Amount

The following table presents the change in the balance of the contingent consideration liability related to acquisitions for which the Corporation utilized Level 3 inputs to determine fair value on a recurring basis for the three months ended March 31, 2016 and 2015:



	Three Months Ended March 31, 2016
(Dollars in thousands)	Balance at December 31, 2015		Contingent Consideration from New Acquisition		Payment of Contingent Consideration		Adjustment of Contingent Consideration		Balance at March 31, 2016
Sterner Insurance Associates	$	1,144	$	—	$	—	$	154	$	1,298
Girard Partners	4,241		—		900		119		3,460
John T. Fretz Insurance Agency	192		—		—		7		199
Total contingent consideration liability	$	5,577	$	—	$	900	$	280	$	4,957



	Three Months Ended March 31, 2015
(Dollars in thousands)	Balance at December 31, 2014		Contingent Consideration from New Acquisition*		Payment of Contingent Consideration		Adjustment of Contingent Consideration		Balance at March 31, 2015
Sterner Insurance Associates	$	680	$	1,424	$	—	$	24	$	2,128
Girard Partners	5,503		$	—	$	620	$	34	4,917
John T. Fretz Insurance Agency	358		—		—		13		371
Total contingent consideration liability	$	6,541	$	1,424	$	620	$	71	$	7,416

Assets Measured at Fair Value on Non-Recurring Basis

The following table represents assets measured at fair value on a non-recurring basis at March 31, 2016 and December 31, 2015:



	At March 31, 2016
(Dollars in thousands)	Level 1		Level 2		Level 3		Assets/Liabilities at Fair Value
Impaired loans held for investment	$	—	$	—	$	46,133	$	46,133
Total	$	—	$	—	$	46,133	$	46,133



	At December 31, 2015
(Dollars in thousands)	Level 1		Level 2		Level 3		Assets/Liabilities at Fair Value
Impaired loans held for investment	$	—	$	—	$	48,611	$	48,611
Total	$	—	$	—	$	48,611	$	48,611

Assets, Liabilities and Off-Balance Sheet Items Not Measured at Fair Value

The following table presents assets and liabilities and off-balance sheet items not measured at fair value on a recurring or non-recurring basis in the Corporation’s consolidated balance sheets but for which the fair value is required to be disclosed at March 31, 2016 and December 31, 2015. The disclosed fair values are classified using the fair value hierarchy.



	At March 31, 2016
(Dollars in thousands)	Level 1		Level 2			Level 3		Fair Value			Carrying Amount
Assets:
Cash and short-term interest-earning assets	$	38,547	$	—		$	—	$	38,547		$	38,547
Held-to-maturity securities			37,031					37,031			36,932
Loans held for sale			3,851					3,851			3,818
Net loans and leases held for investment						2,070,300		2,070,300			2,120,671
Mortgage servicing rights						7,203		7,203			5,839
Other real estate owned			3,073					3,073			3,073
Total assets	$	38,547	$	43,955		$	2,077,503	$	2,160,005		$	2,208,880
Liabilities:
Deposits:
Demand and savings deposits, non-maturity	$	1,951,453	$	—		$	—	$	1,951,453		$	1,951,453
Time deposits			383,986					383,986			382,908
Total deposits	1,951,453		383,986			—		2,335,439			2,334,361
Short-term borrowings	—		24,498			—		24,498			25,851
Subordinated notes	—		50,250			—		50,250			49,414
Total liabilities	$	1,951,453	$	458,734		$	—	$	2,410,187		$	2,409,626
Off-Balance-Sheet:
Commitments to extend credit	$	—	$	(1,829	)	$	—	$	(1,829	)	$	—



	At December 31, 2015
(Dollars in thousands)	Level 1		Level 2			Level 3		Fair Value			Carrying Amount
Assets:
Cash and short-term interest-earning assets	$	60,799	$	—		$	—	$	60,799		$	60,799
Held-to-maturity securities	—		41,061			—		41,061			40,990
Loans held for sale	—		4,708			—		4,708			4,680
Net loans and leases held for investment	—		—			2,099,082		2,099,082			2,112,774
Mortgage servicing rights	—		—			8,047		8,047			5,877
Other real estate owned	—		1,276			—		1,276			1,276
Total assets	$	60,799	$	47,045		$	2,107,129	$	2,214,973		$	2,226,396
Liabilities:
Deposits:
Demand and savings deposits, non-maturity	$	1,939,954	$	—		$	—	$	1,939,954		$	1,939,954
Time deposits	—		455,527			—		455,527			454,406
Total deposits	1,939,954		455,527			—		2,395,481			2,394,360
Short-term borrowings	—		22,302			—		22,302			24,211
Subordinated notes	$	—	$	50,375		$	—	$	50,375		$	49,377
Total liabilities	$	1,939,954	$	528,204		$	—	$	2,468,158		$	2,467,948
Off-Balance-Sheet:
Commitments to extend credit	$	—	$	(1,788	)	$	—	$	(1,788	)	$	—