Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

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, 2014	Total		Level 1		Level 2		Level 3
Securities available for sale:
Obligations of U.S. government corporations and agencies	$	79,860		—	$	79,860		—
Obligations of states and political subdivisions		3,190		—		3,190		—
Corporate debt securities		1,912		—		1,912		—
Mortgage servicing rights		5,985		—		—	$	5,985
Total assets measured at fair value	$	90,947		—	$	84,962	$	5,985
Fair value at December 31, 2013	Total		Level 1		Level 2		Level 3
Securities available for sale:
Obligations of U.S. government corporations and agencies	$	97,143		—	$	97,143		—
Obligations of states and political subdivisions		5,589		—		5,589		—
Corporate debt securities		1,915		—		1,915		—
Mortgage servicing rights		6,165		—		—	$	6,165
Total assets measured at fair value	$	110,812		—	$	104,647	$	6,165

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,					Nine months ended September 30,
	2014			2013		2014			2013
Mortgage servicing rights:
Balance at beginning of period	$	5,909		$	5,571	$	6,165		$	4,552
Issuances		164			297		440			1,186
Change included in earnings		(88	)		181		(620	)		311
Balance at end of period	$	5,985		$	6,049	$	5,985		$	6,049

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, 2014:

	Fair Value		Valuation	Unobservable	Range,
	(in thousands)		Technique	Inputs	Weighted Average
Mortgage Servicing Rights	$	5,985	Discounted cash flow	Constant prepayment rate	6.0%-22.4%, 10.4%
				Discount rate	10.0%-12.0%, 10.0%

The following table presents quantitative information about recurring Level 3 fair value measurements at December 31, 2013:

	Fair Value		Valuation	Unobservable	Range,
	(in thousands)		Technique	Inputs	Weighted Average
Mortgage Servicing Rights	$	6,165	Discounted cash flow	Constant prepayment rate		6.3%-33.0%, 10.3%
				Discount rate		10.0%-12.0%, 10.0%

Assets and Liabilities Measured at Fair Value on Nonrecurring Basis

The tables below present the recorded amount of 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; and the losses from nonrecurring fair value adjustments that occurred in the periods indicated (in thousands):

									Total
Nine months ended September 30, 2014	Total		Level 1		Level 2		Level 3		Losses
Fair value:
Impaired Originated & PNCI loans	$	3,090		—		—	$	3,090	$	617
Foreclosed assets		3,012		—		—		3,012		110
Total assets measured at fair value	$	6,102		—		—	$	6,102	$	727
									Total
Year ended December 31, 2013	Total		Level 1		Level 2		Level 3		Losses
Fair value:
Impaired Originated & PNCI loans	$	20,334		—		—	$	20,334	$	2,539
Foreclosed assets		948		—		—		948		397
Total assets measured at fair value	$	21,282		—		—	$	21,282	$	2,936
									Total
Nine months ended September 30, 2013	Total		Level 1		Level 2		Level 3		Losses
Fair value:
Impaired Originated & PNCI loans	$	22,638		—		—	$	22,638	$	2,836
Foreclosed assets		2,049		—		—		2,049		531
Total assets measured at fair value	$	24,687		—		—	$	24,687	$	3,367

Losses from Nonrecurring Fair Value Adjustments that Occurred in the Periods Indicated

The table below presents the losses from nonrecurring fair value adjustments that occurred in the periods indicated (in thousands):

	Three months ended September 30,
Losses from nonrecurring fair value adjustments:	2014		2013
Impaired Originated & PNCI loans	$	211	$	258
Foreclosed assets		98		—
Total losses from nonrecurring fair value adjustments	$	309	$	258

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, 2014:

	Fair Value		Valuation	Unobservable	Range,
	(in thousands)		Technique	Inputs	Weighted Average
Impaired Originated & PNCI loans	$	3,090	Sales comparison approach	Adjustment for differences between comparable sales	(5.0)%-(39.0)%, (9.0)%
			Income approach	Capitalization rate	9.09%-9.25 %, 9.23%
Foreclosed assets	$	3,012	Sales comparison approach	Adjustment for differences between comparable sales	(5.0)%-(28.6)%, (7.7)%

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, 2013:

	Fair Value		Valuation	Unobservable	Range,
	(in thousands)		Technique	Inputs	Weighted Average
Impaired Originated & PNCI loans	$	20,334	Sales comparison approach	Adjustment for differences between comparable sales	(5.0)%-(56.4)%, (10.4)%
			Income approach	Capitalization rate	7.75%-9.25 %, 8.91%
Foreclosed assets	$	948	Sales comparison approach	Adjustment for differences between comparable sales	(6.5)%-(16.7)%, (8.9)%

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

The estimated fair values of financial instruments that are reported at amortized cost in the Corporation’s consolidated balance sheets, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value, were as follows (in thousands):

	September 30, 2014				December 31, 2013
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets:
Level 1 inputs:
Cash and due from banks	$	74,476	$	74,476	$	76,915	$	76,915
Cash at Federal Reserve and other banks		295,203		295,203		521,453		521,453
Level 2 inputs:
Securities held to maturity		443,509		446,804		240,504		233,807
Restricted equity securities		11,582		11,582		9,163		9,163
Loans held for sale		2,724		2,724		2,270		2,270
Level 3 inputs:
Loans, net		1,727,951		1,799,884		1,672,007		1,760,274
Financial liabilities:
Level 2 inputs:
Deposits		2,437,356		2,437,687		2,410,483		2,411,402
Other borrowings		12,665		12,665		6,335		6,335
Junior subordinated debt		41,238		29,279		41,238		25,774
	Contract Amount		Fair Value		Contract Amount		Fair Value
Off-balance sheet:
Level 3 inputs:
Commitments	$	581,745	$	5,817	$	555,386	$	5,554
Standby letters of credit		3,566		36		2,601		26
Overdraft privilege commitments		70,677		707		68,932		689