Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Summary of Recorded Amount of Assets and Liabilities Measured at Fair Value on Recurring Basis

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis (in thousands):

Fair value at September 30, 2023	Total		Level 1		Level 2		Level 3
Marketable equity securities	$	2,517	$	2,517
Debt securities available for sale:
Obligations of U.S. government corporations and agencies	1,207,172				1,207,172
Obligations of states and political subdivisions	258,669				258,669
Corporate bonds	5,505				5,505
Asset backed securities	369,729				369,729
Non-agency mortgage backed securities	333,262				333,262
Loans held for sale	644				644
Mortgage servicing rights	6,792						6,792
Total assets measured at fair value	$	2,184,290	$	2,517	$	2,174,981	$	6,792

Fair value at December 31, 2022	Total		Level 1		Level 2		Level 3
Marketable equity securities	$	2,598	$	2,598	$	—	$	—
Debt securities available for sale:
Obligations of U.S. government corporations and agencies	1,372,769		—		1,372,769		—
Obligations of states and political subdivisions	293,205		—		293,205		—
Corporate bonds	5,751		—		5,751		—
Asset backed securities	439,767		—		439,767		—
Non-agency mortgage backed securities	340,946				340,946
Loans held for sale	1,846		—		1,846		—
Mortgage servicing rights	6,712		—		—		6,712
Total assets measured at fair value	$	2,463,594	$	2,598	$	2,454,284	$	6,712

Summary of Reconciliation of Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) on Recurring Basis

The following table provides a reconciliation of assets and liabilities measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the time periods indicated. Had there been any transfer into or out of Level 3 during the time periods indicated, the amount included in the “Transfers into (out of) Level 3” column would represent the beginning balance of an item in the period (interim quarter) during which it was transferred (in thousands):

Three months ended September 30,	Beginning Balance		Transfers into (out of) Level 3	Change Included in Earnings		Issuances		Ending Balance
2023: Mortgage servicing rights	$	6,741	—	$	(91)	$	142	$	6,792
2022: Mortgage servicing rights	$	6,667	—	$	33	$	98	$	6,798

Nine months ended September 30,	Beginning Balance		Transfers into (out of) Level 3	Change Included in Earnings		Issuances		Ending Balance
2023: Mortgage servicing rights	$	6,712		$	(215)	$	295	$	6,792
2022: Mortgage servicing rights	$	5,874	—	$	443	$	481	$	6,798

Summary of Quantitative Information about Recurring Level 3 Fair Value Measurements

The following table presents quantitative information about recurring Level 3 fair value measurements at September 30, 2023 and December 31, 2022:

As of September 30, 2023:	Fair Value (in thousands)		Valuation Technique	Unobservable Inputs	Range, Weighted Average
Mortgage Servicing Rights	$	6,792	Discounted cash flow	Constant prepayment rate	6% - 12%; 7.0%
				Discount rate	10% - 14%; 12%
As of December 31, 2022:
Mortgage Servicing Rights	$	6,712	Discounted cash flow	Constant prepayment rate	7% - 13.6%; 7.6%
				Discount rate	10% - 14%; 12%

Summary of Assets and Liabilities Measured at Fair Value on Nonrecurring Basis

The tables below present the recorded investment in assets and liabilities measured at fair value on a nonrecurring basis, as of the dates indicated, that had a write-down or an additional allowance provided during the periods indicated (in thousands):

September 30, 2023	Total		Level 1		Level 2		Level 3
Fair value:
Individually evaluated loans	$	5,619	—		—		$	5,619
Foreclosed assets	175		—		—		175
Total assets measured at fair value	$	5,794	$	—	$	—	$	5,794

December 31, 2022	Total		Level 1	Level 2	Level 3
Fair value:
Individually evaluated loans	$	5,719	—	—	$	5,719
Foreclosed assets	311		—	—	311
Total assets measured at fair value	$	6,030	—	—	$	6,030

The tables below present the (losses) gains resulting from non-recurring fair value adjustments of assets and liabilities for the periods indicated (in thousands):

	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Individually evaluated loans	$	4,749	$	(1,567)	$	(2,281)	$	(2,182)
Foreclosed assets	(41)		13		(233)		111
Total losses from non-recurring measurements	$	4,708	$	(1,554)	$	(2,514)	$	(2,071)

Summary of Quantitative Information about Level 3 Fair Value Measurements for Financial Instruments Measured at Fair Value on Nonrecurring Basis

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at September 30, 2023:

September 30, 2023	Fair Value (in thousands)		Valuation Technique	Unobservable Inputs	Range, Weighted Average
Individually evaluated loans	$	5,619	Sales comparison approach Income approach	Adjustment for differences between comparable sales; Capitalization rate	Not meaningful N/A
Foreclosed assets (Commerical real estate)	$	175	Income Approach	Capitalization rate	Not meaningful N/A

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis at December 31, 2022:

December 31, 2022	Fair Value (in thousands)		Valuation Technique	Unobservable Inputs	Range, Weighted Average
Individually evaluated loans	$	5,719	Sales comparison approach Income approach	Adjustment for differences between comparable sales; Capitalization rate	Not meaningful N/A
Foreclosed assets (Residential real estate)	$	311	Sales comparison approach	Adjustment for differences between comparable sales	Not meaningful N/A

Summary of Estimated Fair Values of Financial Instruments that are Reported at Amortized Cost in Consolidated Balance Sheets

	September 30, 2023				December 31, 2022
(in thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial assets:
Level 1 inputs:
Cash and due from banks	$	75,332	$	75,332	$	96,323	$	96,323
Cash at Federal Reserve and other banks	35,767		35,767		10,907		10,907
Level 2 inputs:
Securities held to maturity	139,058		124,058		160,983		149,938
Restricted equity securities	17,250		N/A		17,250		N/A
Level 3 inputs:
Loans, net	6,592,854		6,230,247		6,344,767		6,153,155
Financial liabilities:
Level 2 inputs:
Deposits	8,009,643		8,001,633		8,329,013		8,321,517
Other borrowings	537,975		537,975		264,605		264,605
Level 3 inputs:
Junior subordinated debt	101,080		93,600		101,040		92,613

(in thousands)	Contract Amount		Fair Value		Contract Amount		Fair Value
Off-balance sheet:
Level 3 inputs:
Commitments	$	2,268,288	$	22,683	$	2,188,560	$	21,886
Standby letters of credit	38,730		387		26,599		266
Overdraft privilege commitments	124,392		1,244		126,634		1,266