Junior Subordinated Debentures

Following is information about the Company's wholly-owned trusts ("Trusts") as of June 30, 2014:



(dollars in thousands)		Issued		Carrying			Effective
Trust Name	Issue Date	Amount		Value (1)		Rate (2)	Rate (3)	Maturity Date
AT FAIR VALUE:
Umpqua Statutory Trust II	October 2002	$	20,619	$	14,946	Floating rate, LIBOR plus 3.35%, adjusted quarterly	4.93%	October 2032
Umpqua Statutory Trust III	October 2002	30,928		22,619		Floating rate, LIBOR plus 3.45%, adjusted quarterly	5.02%	November 2032
Umpqua Statutory Trust IV	December 2003	10,310		7,061		Floating rate, LIBOR plus 2.85%, adjusted quarterly	4.49%	January 2034
Umpqua Statutory Trust V	December 2003	10,310		7,039		Floating rate, LIBOR plus 2.85%, adjusted quarterly	4.51%	March 2034
Umpqua Master Trust I	August 2007	41,238		23,082		Floating rate, LIBOR plus 1.35%, adjusted quarterly	2.82%	September 2037
Umpqua Master Trust IB	September 2007	20,619		13,607		Floating rate, LIBOR plus 2.75%, adjusted quarterly	4.52%	December 2037
Sterling Capital Trust III	April 2003	14,433		11,026		Floating rate, LIBOR plus 3.25%, adjusted quarterly	4.55%	April 2033
Sterling Capital Trust IV	May 2003	10,310		7,788		Floating rate, LIBOR plus 3.15%, adjusted quarterly	4.47%	May 2033
Sterling Capital Statutory Trust V	May 2003	20,619		15,642		Floating rate, LIBOR plus 3.25%, adjusted quarterly	4.59%	June 2033
Sterling Capital Trust VI	June 2003	10,310		7,766		Floating rate, LIBOR plus 3.20%, adjusted quarterly	4.55%	September 2033
Sterling Capital Trust VII	June 2006	56,702		32,894		Floating rate, LIBOR plus 1.53%, adjusted quarterly	3.03%	June 2036
Sterling Capital Trust VIII	September 2006	51,547		30,270		Floating rate, LIBOR plus 1.63%, adjusted quarterly	3.17%	December 2036
Sterling Capital Trust IX	July 2007	46,392		26,110		Floating rate, LIBOR plus 1.40%, adjusted quarterly	2.90%	October 2037
Lynnwood Financial Statutory Trust I	March 2003	9,279		6,956		Floating rate, LIBOR plus 3.15%, adjusted quarterly	4.51%	March 2033
Lynnwood Financial Statutory Trust II	June 2005	10,310		6,309		Floating rate, LIBOR plus 1.80%, adjusted quarterly	3.32%	June 2035
Klamath First Capital Trust I	July 2001	15,464		12,962		Floating rate, LIBOR plus 3.75%, adjusted semiannually	4.88%	July 2031
		$	379,390	$	246,077
AT AMORTIZED COST:
HB Capital Trust I	March 2000	$	5,310	$	6,189	10.875%	8.43%	March 2030
Humboldt Bancorp Statutory Trust I	February 2001	5,155		5,800		10.200%	8.39%	February 2031
Humboldt Bancorp Statutory Trust II	December 2001	10,310		11,244		Floating rate, LIBOR plus 3.60%, adjusted quarterly	3.03%	December 2031
Humboldt Bancorp Statutory Trust III	September 2003	27,836		30,278		Floating rate, LIBOR plus 2.95%, adjusted quarterly	2.50%	September 2033
CIB Capital Trust	November 2002	10,310		11,110		Floating rate, LIBOR plus 3.45%, adjusted quarterly	3.01%	November 2032
Western Sierra Statutory Trust I	July 2001	6,186		6,186		Floating rate, LIBOR plus 3.58%, adjusted quarterly	3.80%	July 2031
Western Sierra Statutory Trust II	December 2001	10,310		10,310		Floating rate, LIBOR plus 3.60%, adjusted quarterly	3.83%	December 2031
Western Sierra Statutory Trust III	September 2003	10,310		10,310		Floating rate, LIBOR plus 2.90%, adjusted quarterly	3.13%	September 2033
Western Sierra Statutory Trust IV	September 2003	10,310		10,310		Floating rate, LIBOR plus 2.90%, adjusted quarterly	3.13%	September 2033
		96,037		101,737
	Total	$	475,427	$	347,814


(1)	Includes purchase accounting adjustments, net of accumulated amortization, for junior subordinated debentures assumed in connection with previous mergers as well as fair value adjustments related to trusts recorded at fair value.


(2)	Contractual interest rate of junior subordinated debentures.


(3)	Effective interest rate based upon the carrying value as of June 30, 2014.

The Trusts are reflected as junior subordinated debentures in the Condensed Consolidated Balance Sheets. The common stock issued by the Trusts is recorded in other assets in the Condensed Consolidated Balance Sheets, and totaled $14.3 million at June 30, 2014 and $6.9 million at December 31, 2013. As of June 30, 2014, all of the junior subordinated debentures were redeemable at par, at their applicable quarterly or semiannual interest payment dates.

The Company selected the fair value measurement option for junior subordinated debentures originally issued by the Company (the Umpqua Statutory Trusts) and for junior subordinated debentures acquired from Sterling. Refer to Note 16 for discussion of the rational for election of fair value and the approach used to fair value the selected junior subordinated debentures.

Absent changes to the significant inputs utilized in the discounted cash flow model used to measure the fair value of these instruments, the discounts will reverse over time in a manner similar to the effective interest rate method as if these instruments were accounted for under the amortized cost method. Losses recorded resulting from the change in the fair value of these instruments were $1.4 million and $547,000 for the three months ended June 30, 2014 and 2013 and $1.9 million and $1.1 million for the six months ended June 30, 2014 and 2013.