FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2012

FAIR VALUE MEASUREMENTS

Schedule of information on the assets measured and recorded at fair value on a recurring basis

	Fair Value Measurement as of December 31, 2012
	Total		Level 1		Level 2		Level 3
	(In thousands)
Measured on a Recurring Basis:
Securities available-for-sale:
Government agency and government-sponsored enterprise residential mortgage-backed securities	$	909,536	$	—	$	909,536	$	—
Covered private label CMOs		44,684		—		—		44,684
Municipal securities		348,041		—		348,041		—
Corporate debt securities		42,365		—		42,365		—
Other securities		10,759		8,985		1,774		—
	$	1,355,385	$	8,985	$	1,301,716	$	44,684

	Fair Value Measurement as of December 31, 2011
	Total		Level 1		Level 2		Level 3
	(In thousands)
Measured on a Recurring Basis:
Securities available-for-sale:
Government agency and government-sponsored enterprise residential mortgage-backed securities	$	1,124,534	$	—	$	1,124,534	$	—
Covered private label CMOs		45,149		—		—		45,149
Municipal securities		126,797		—		126,797		—
Corporate debt securities		25,128		—		25,128		—
Other securities		4,750		2,976		1,774		—
	$	1,326,358	$	2,976	$	1,278,233	$	45,149

Fair value measurements

Summary of activity for assets measured at fair value on a recurring basis that are categorized as Level 3

	Year Ended December 31,
	2012			2011			2010
	(In thousands)
Covered private label CMOs, beginning of year	$	45,149		$	50,437		$	52,125
Total realized in earnings(1)		340			2,097			1,058
Total unrealized gain (loss) in comprehensive income		4,883			(846	)		5,411
Net settlements		(5,688	)		(6,539	)		(8,157	)
Covered private label CMOs, end of year	$	44,684		$	45,149		$	50,437

⁽¹⁾

Includes other-than-temporary impairment loss of $1.1 million for 2012, none for 2011, and $874,000 for 2010.

Schedule of assets measured at fair value on a non-recurring basis

	Fair Value Measurement as of December 31, 2012
	Total		Level 1		Level 2		Level 3
	(In thousands)
Measured on a Non-Recurring Basis:
Non-covered impaired loans	$	102,207	$	—	$	4,975	$	97,232
Non-covered other real estate owned		7,945		—		—		7,945
Covered other real estate owned		4,893		—		2,599		2,294
SBA loan servicing asset		1,000		—		—		1,000
	$	116,045	$	—	$	7,574	$	108,471

	Fair Value Measurement as of December 31, 2011
	Total		Level 1		Level 2		Level 3
	(In thousands)
Measured on a Non-Recurring Basis:
Non-covered impaired loans	$	114,353	$	—	$	13,803	$	100,550
Non-covered other real estate owned		44,106		—		3,679		40,427
Covered other real estate owned		29,490		—		24,729		4,761
SBA loan servicing asset		1,254		—		—		1,254
	$	189,203	$	—	$	42,211	$	146,992

Schedule of gains and (losses) on assets measured at fair value on a non-recurring basis

	Year Ended December 31,
	2012			2011			2010
	(In thousands)
Gain (Loss) on Assets Measured on a Non-Recurring Basis:
Non-covered impaired loans	$	(5,582	)	$	(22,796	)	$	(30,639	)
Non-covered other real estate owned		(2,824	)		(4,381	)		(8,915	)
Covered other real estate owned		(1,096	)		(9,275	)		(3,982	)
SBA loan servicing asset		4			2			204
Total net loss	$	(9,498	)	$	(36,450	)	$	(43,332	)

Summary of carrying values and estimated fair values of certain financial instruments

	December 31, 2012
			Estimated Fair Value
	Carrying or Contract Amount
			Total		Level 1		Level 2		Level 3
	(In thousands)
Financial Assets:
Cash and due from banks	$	89,011	$	89,011	$	89,011	$	—	$	—
Interest-earning deposits in financial institutions		75,393		75,393		75,393		—		—
Securities available-for-sale		1,355,385		1,355,385		8,985		1,301,716		44,684
Investment in FHLB stock		37,126		37,126		—		37,126		—
Loans and leases, net		3,498,329		3,551,674		—		4,975		3,546,699
SBA loan servicing asset		1,000		1,000		—		—		1,000
Financial Liabilities:
Deposits
Demand, money market and savings deposits		3,888,794		3,888,794		—		3,888,794		—
Time deposits		820,327		823,912		—		823,912		—
Borrowings		12,591		12,611		—		12,611		—
Subordinated debentures		108,250		108,186		—		108,186		—

	December 31, 2011
			Estimated Fair Value
	Carrying or Contract Amount
			Total		Level 1		Level 2		Level 3
	(In thousands)
Financial Assets:
Cash and due from banks	$	92,342	$	92,342	$	92,342	$	—	$	—
Interest-earning deposits in financial institutions		203,275		203,275		203,275		—		—
Securities available-for-sale		1,326,358		1,326,358		2,976		1,278,233		45,149
Investment in FHLB stock		46,106		46,106		—		46,106		—
Loans and leases, net		3,425,423		3,469,754		—		13,803		3,455,951
SBA loan servicing asset		1,613		1,613		—		—		1,613
Financial Liabilities:
Deposits:
Demand, money market and savings deposits		3,609,559		3,609,559		—		3,609,559		—
Time deposits		967,894		977,589		—		977,589		—
Borrowings		225,000		249,000		—		249,000		—
Subordinated debentures		129,271		135,532		—		135,532		—

Recurring basis

Fair value measurements

Schedule of information about quantitative unobservable inputs, assumptions and valuation methodology used to evaluate the fair values

The following table presents information about quantitative inputs and assumptions used to evaluate the fair values provided by our third party pricing service for our Level 3 covered private label CMOs measured at fair value on a recurring basis as of December 31, 2012:

Unobservable Inputs	Range of Inputs	Weighted Average Input
Covered Private Label CMO's:
Voluntary prepayment speeds	0% - 33.7%		10.1	%
Monthly default rates	0% - 14.2%		3.7	%
Loss severity rates	0% - 65.5%		39.7	%
Discount rates	0.8% - 17.7%		5.0	%

Nonrecurring basis

Fair value measurements

Schedule of information about quantitative unobservable inputs, assumptions and valuation methodology used to evaluate the fair values

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a nonrecurring basis as of December 31, 2012:

Asset	Fair Value		Valuation Methodology	Unobservable Inputs	Range	Weighted Average
	(in 000's)
Impaired loans(1)	$	94,038	Discounted cash flow	Discount rates	4.00% - 8.75%		7.69	%
	$	1,184	Appraisals	Discount	4% - 100%		30	%
OREO	$	10,239	Appraisals	Discount, including 8% for selling costs	5% - 29%		8	%
SBA loan servicing asset	$	1,000	Discounted cash flow	Prepayment speeds	3.69% - 17.04%			(2)
				Discount rates	9.68% - 12.58%			(2)

⁽¹⁾

Excludes $2.0 million of impaired loans with balances of $250,000 or less.

⁽²⁾

Not readily available.