Fair value measurements (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of estimated fair values of certain of the Company's financial instruments

The following table presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments. For stock in Federal Home Loan Bank, the carrying amount is a reasonable estimate of fair value because it can only be redeemed at par. For bank-owned life insurance, the carrying amount is the cash surrender value of the insurance policies, which is a reasonable estimate of fair value. For financial liabilities such as noninterest-bearing demand, interest-bearing demand, and savings and money market deposits, the carrying amount is a reasonable estimate of fair value as these liabilities have no stated maturity.



			Estimated fair value
(in thousands)	Carrying or notional amount		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
December 31, 2015
Financial assets
Money market funds	$	10	$	—	$	10	$	—	$	10
Available-for-sale investment securities	820,648		—		820,648		—		820,648
Stock in Federal Home Loan Bank	10,678		—		10,678		—		10,678
Loans receivable, net	4,570,412		—		4,639		4,744,886		4,749,525
Mortgage servicing rights	8,444		—		—		11,790		11,790
Bank-owned life insurance	138,139		—		138,139		—		138,139
Derivative assets	22,616		—		385		—		385
Financial liabilities
Deposit liabilities	5,025,254		—		5,024,500		—		5,024,500
Short-term borrowings—other than bank	103,063		—		103,063		—		103,063
Other bank borrowings	328,582		—		333,392		—		333,392
Long-term debt, net—other than bank	1,586,546		—		1,669,087		—		1,669,087
The Utilities' long-term debt, net (included in amount above)	1,286,546		—		1,363,766		—		1,363,766
Derivative liabilities	23,269		15		15		—		30
December 31, 2014
Financial assets
Money market funds	$	10	$	—	$	10	$	—	$	10
Available-for-sale investment securities	550,394		—		550,394		—		550,394
Stock in Federal Home Loan Bank	69,302		—		69,302		—		69,302
Loans receivable, net	4,397,457		—		8,713		4,570,109		4,578,822
Mortgage servicing rights	11,540		—		—		14,504		14,504
Bank-owned life insurance	134,115		—		134,115		—		134,115
Derivative assets	30,120		—		398		—		398
Financial liabilities
Deposit liabilities	4,623,415		—		4,623,773		—		4,623,773
Short-term borrowings—other than bank	118,972		—		118,972		—		118,972
Other bank borrowings	290,656		—		298,837		—		298,837
Long-term debt, net—other than bank	1,506,546		—		1,622,736		—		1,622,736
The Utilities' long-term debt, net (included in amount above)	1,206,546		—		1,313,893		—		1,313,893
Derivative liabilities	32,043		71		43		—		114

Schedule of assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis were as follows:



December 31	2015						2014
	Fair value measurements using						Fair value measurements using
(in thousands)	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Money market funds (“other” segment)	$	—	$	10	$	—	$	—	$	10	$	—
Available-for-sale investment securities (bank segment)
Mortgage-related securities-FNMA, FHLMC and GNMA	$	—	$	607,689	$	—	$	—	$	430,834	$	—
U.S. Treasury and federal agency obligations	—		212,959		—		—		119,560		—
	$	—	$	820,648	$	—	$	—	$	550,394	$	—
Derivative assets ¹
Interest rate lock commitments	$	—	$	384	$	—	$	—	$	393	$	—
Forward commitments	—		1		—		—		5		—
	$	—	$	385	$	—	$	—	$	398	$	—
Derivative liabilities ¹
Interest rate lock commitments	$	—	$	—	$	—	$	—	$	3	$	—
Forward commitments	15		15		—		71		40		—
	$	15	$	15	$	—	$	71	$	43	$	—


¹	Derivatives are carried at fair value with changes in value reflected in the balance sheet in other assets or other liabilities and included in mortgage banking income.

Schedule of assets measured at fair value on a nonrecurring basis

The carrying value of assets measured at fair value on a nonrecurring basis were as follows:



			Fair value measurements using
(in thousands)	Balance		Level 1		Level 2		Level 3
December 31, 2015
Loans	$	178	$	—	$	—	$	178
Real estate acquired in settlement of loans	1,030		—		—		1,030
December 31, 2014
Loans	2,445		—		—		2,445
Real estate acquired in settlement of loans	288		—		—		288
Mortgage servicing rights	1,240		—		—		1,240

Schedule of significant unobservable inputs used in the fair value measurement

Key assumptions used in estimating the fair value of ASB’s mortgage servicing rights used in the impairment analysis were as follows:



December 31	2015			2014
(dollars in thousands)
Unpaid principal balance	$	1,097,314		$	1,391,030
Weighted average note rate	4.05		%	4.07		%
Weighted average discount rate	9.6		%	9.6		%
Weighted average prepayment speed	9.3		%	9.5		%

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis:



					Significant unobsetvable input value (1)
(dollars in thousands)	Fair value		Valuation technique	Significant unobservable input	Range	Weighted Average
December 31, 2015
Residential loans	$	50	Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)
Home equity lines of credit	128		Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)
Total loans	$	178

Real estate acquired in settlement of loans	$	1,030	Fair value of property or collateral	Appraised value less 7% selling cost	100%	100%
December 31, 2014
Residential loans	$	2,297	Fair value of property or collateral	Appraised value less 7% selling cost	39-99%	83%
Home equity lines of credit	3		Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)
Commercial loans	145		Fair value of property or collateral	Fair value of business assets		N/A (2)
Total loans	$	2,445

Real estate acquired in settlement of loans	$	288	Fair value of property or collateral	Appraised value less 7% selling cost	100%	100%

Mortgage servicing rights	$	1,240	Discounted cash flow	Prepayment speed	6.7-22.4%	12.2%
				Discount rate	9.6%	9.6%


(1)	Represent percent of outstanding principal balance.


(2)	N/A - Not applicable. There is one loan in each fair value measurement type.

Schedule of assets held in various trusts are measured at fair value on a recurring basis

Assets held in various trusts for the retirement benefit plans are measured at fair value on a recurring basis and were as follows:



	Pension benefits									Other benefits
				Fair value measurements using									Fair value measurements using
(in millions)	December 31			Level 1		Level 2		Level 3		December 31			Level 1		Level 2		Level 3
2015
Equity securities	$	640		$	640	$	—	$	—	$	92		$	92	$	—	$	—
Equity index funds	119			119		—		—		17			17		—		—
Fixed income securities and public mutual funds	425			85		340		—		48			41		7		—
Pooled and mutual funds and other	84			3		81		—		14			4		10		—
Total	$	1,268		$	847	$	421	$	—	$	171		$	154	$	17	$	—
Cash, receivables and payables, net	3									—
Fair value of plan assets	$	1,271								$	171
2014
Equity securities	$	649		$	649	$	—	$	—	$	99		$	99	$	—	$	—
Equity index funds	132			132		—		—		19			19		—		—
Fixed income securities and public mutual funds	428			121		307		—		49			43		6		—
Pooled and mutual funds and other	82			1		81		—		14			3		11		—
Total	1,291			$	903	$	388	$	—	181			$	164	$	17	$	—
Cash, receivables and payables, net	(25		)							(1		)
Fair value of plan assets	$	1,266								$	180