Fair Value (Tables)

9 Months Ended

Sep. 30, 2022

Fair Value

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

	Fair Value Measurements as of September 30, 2022
	Quoted Prices in		Significant
	Active Markets for		Other		Significant
	Identical Assets		Observable		Unobservable
(dollars in thousands)	(Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total
Assets
U.S. Treasury and government agency debt securities	$	—	$	152,522	$	—	$	152,522
Government-sponsored enterprises debt securities		—		44,326		—		44,326
Mortgage-backed securities:
Residential - Government agency(1)		—		61,634		—		61,634
Residential - Government-sponsored enterprises(1)		—		1,197,841		—		1,197,841
Commercial - Government agency		—		250,665		—		250,665
Commercial - Government-sponsored enterprises		—		131,321		—		131,321
Commercial - Non-agency		—		21,670		—		21,670
Collateralized mortgage obligations:
Government agency		—		694,213		—		694,213
Government-sponsored enterprises		—		489,448		—		489,448
Collateralized loan obligations		—		245,520		—		245,520
Total available-for-sale securities		—		3,289,160		—		3,289,160
Other assets(2)		6,710		11,542		—		18,252
Liabilities
Other liabilities(3)		—		(54,821)		(2,359)		(57,180)
Total	$	6,710	$	3,245,881	$	(2,359)	$	3,250,232

(1) Backed by residential real estate.

(2) Other assets classified as Level 1 include mutual funds and money market funds that have quoted prices in active markets and are related to the Company’s deferred compensation plans. Other assets classified as Level 2 include derivative assets.

(3) Other liabilities include derivative liabilities.

	Fair Value Measurements as of December 31, 2021
	Quoted Prices in		Significant
	Active Markets for		Other		Significant
	Identical Assets		Observable		Unobservable
(dollars in thousands)	(Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total
Assets
U.S. Treasury and government agency debt securities	$	—	$	192,563	$	—	$	192,563
Mortgage-backed securities:
Residential - Government agency(1)		—		137,264		—		137,264
Residential - Government-sponsored enterprises(1)		—		1,491,100		—		1,491,100
Commercial - Government agency		—		387,663		—		387,663
Commercial - Government-sponsored enterprises		—		1,369,443		—		1,369,443
Collateralized mortgage obligations:
Government agency		—		2,079,523		—		2,079,523
Government-sponsored enterprises		—		2,621,044		—		2,621,044
Collateralized loan obligations		—		105,247		—		105,247
Debt securities issued by states and political subdivisions		—		44,185		—		44,185
Total available-for-sale securities		—		8,428,032		—		8,428,032
Other assets(2)		7,382		50,925		—		58,307
Liabilities
Other liabilities(3)		—		(1,238)		(5,530)		(6,768)
Total	$	7,382	$	8,477,719	$	(5,530)	$	8,479,571

(1) Backed by residential real estate.

(2) Other assets classified as Level 1 include mutual funds and money market funds that have quoted prices in active markets and are related to the Company’s deferred compensation plans. Other assets classified as Level 2 include derivative assets.

(3) Other liabilities include derivative liabilities.

Significant unobservable inputs used in fair value measurements for Level 3 assets and liabilities measured at fair value on a recurring basis

	Quantitative Information about Level 3 Fair Value Measurements at September 30, 2022
				Significant
(dollars in thousands)	Fair value		Valuation Technique	Unobservable Input	Range
Visa derivative	$	(2,359)	Discounted Cash Flow	Expected Conversion Rate - 1.6059(1)	1.5885-1.6059
				Expected Term - 1 year(2)	0.5 to 1.5 years
				Growth Rate - 26%(3)	10% - 38%

	Quantitative Information about Level 3 Fair Value Measurements at December 31, 2021
				Significant
(dollars in thousands)	Fair value		Valuation Technique	Unobservable Input	Range
Visa derivative	$	(5,530)	Discounted Cash Flow	Expected Conversion Rate - 1.6181(1)	1.5885-1.6181
				Expected Term - 1 year(2)	0.5 to 1.5 years
				Growth Rate - 26%(3)	10% - 38%

(1) Due to the uncertainty in the movement of the conversion rate, the current conversion rate was utilized in the fair value calculation.

(2) The expected term of 1 year was based on the median of 0.5 to 1.5 years.

(3) The growth rate was based on the arithmetic average of analyst price targets.

Summary of changes in Level 3 liabilities measured at fair value on a recurring basis

	Visa Derivative
(dollars in thousands)	2022		2021
Three Months Ended September 30,
Balance as of July 1,	$	(3,786)	$	(2,132)
Total net gains (losses) included in other noninterest income		273		(49)
Settlements		1,154		1,329
Balance as of September 30,	$	(2,359)	$	(852)
Total net gains (losses) included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of September 30,	$	273	$	(49)
Nine Months Ended September 30,
Balance as of January 1,	$	(5,530)	$	(4,554)
Total net losses included in other noninterest income		(1,084)		(46)
Settlements		4,255		3,748
Balance as of September 30,	$	(2,359)	$	(852)
Total net losses included in net income attributable to the change in unrealized losses related to liabilities still held as of September 30,	$	(1,084)	$	(46)

Summary of estimated fair value of financial instruments not required to be carried at fair value on a recurring basis

	September 30, 2022
			Fair Value Measurements
			Quoted Prices in		Significant		Significant
			Active Markets		Other		Unobservable
			for Identical		Observable		Inputs
(dollars in thousands)	Book Value		Assets (Level 1)		Inputs (Level 2)		(Level 3)		Total
Financial assets:
Cash and cash equivalents	$	948,934	$	291,360	$	657,574	$	—	$	948,934
Investment securities held-to-maturity		4,406,143		—		3,960,713		—		3,960,713
Loans held for sale		361		—		361		—		361
Loans(1)		13,394,536		—		—		12,667,869		12,667,869
Financial liabilities:
Time deposits(2)	$	1,898,922	$	—	$	1,852,736	$	—	$	1,852,736

	December 31, 2021
			Fair Value Measurements
			Quoted Prices in		Significant		Significant
			Active Markets		Other		Unobservable
			for Identical		Observable		Inputs
(dollars in thousands)	Book Value		Assets (Level 1)		Inputs (Level 2)		(Level 3)		Total
Financial assets:
Cash and cash equivalents	$	1,258,469	$	246,716	$	1,011,753	$	—	$	1,258,469
Loans held for sale		538		—		542		—		542
Loans(1)		12,730,605		—		—		12,791,811		12,791,811
Financial liabilities:
Time deposits(2)	$	1,776,438	$	—	$	1,773,321	$	—	$	1,773,321

(1) Excludes financing leases of $305.8 million at September 30, 2022 and $231.4 million at December 31, 2021.

(2) Excludes deposit liabilities with no defined or contractual maturity of $20.2 billion as of September 30, 2022 and $20.0 billion as of December 31, 2021.