Fair Values of Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2013

Fair Value Disclosures [Abstract]

Fair Value Inputs, Assets, Quantitative Information

In accordance with ASU 2011-4, the following table provides information related to quantitative inputs and assumptions used in Level 3 fair value measurements.

	Fair Value (dollars in thousands)	Valuation Technique	Unobservable Inputs	Range / (weighted average)
Pooled Trust Preferred Securities	$24,512	Discounted Cash Flow	Probability of default	0% -100% (21.44%)
			Prepayment rates	0% - 81.75% (9.60%)
			Discount rates	6.25% - 18%(a)
Equities	1,420	Par Value	N/A	N/A
Interest Rate Swap	—	Option model	Counterparty credit risk	8.56% - 10.31% (b)
Impaired Loans	734 (c)	Reserve study	Discount rate	10.00%
			Gas per MCF	$3.67 - $7.60 (d)
			Oil per BBL/d	$90.97 - $106.00 (d)
			NGL per gallon	$1.54 (d)
Other Real Estate Owned	215	Internal Valuation	N/A	N/A

(a) incorporates spread over risk free rate related primarily to credit quality and illiquidity of securities.

(b) represents the range of the credit spread curve used in valuation.

(c) the remainder of impaired loans valued using Level 3 inputs are not included in this disclosure as the values of those loans are based on bankruptcy agreement documentation.

(d) unobservable inputs are defined as follows: MCF - million cubic feet; BBL/d - barrels per day; NGL - natural gas liquid.

Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

The tables below present the balances of assets and liabilities measured at fair value on a recurring basis:

	March 31, 2013
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Obligations of U.S. Government Agencies:
Mortgage-Backed Securities—Residential	$	—	$	30,462	$	—	$	30,462
Obligations of U.S. Government-Sponsored Enterprises:
Mortgage-Backed Securities—Residential	—		990,660		—		990,660
Mortgage-Backed Securities—Commercial	—		140		—		140
Other Government-Sponsored Enterprises	—		242,438		—		242,438
Obligations of States and Political Subdivisions	—		85		—		85
Corporate Securities	—		6,973		—		6,973
Pooled Trust Preferred Collateralized Debt Obligations	—		—		24,512		24,512
Total Debt Securities	—		1,270,758		24,512		1,295,270
Equities	513		—		1,420		1,933
Total Securities Available for Sale	513		1,270,758		25,932		1,297,203
Other Investments	—		28,357		—		28,357
Other Assets(a)	—		16,763		—		16,763
Total Assets	$	513	$	1,315,878	$	25,932	$	1,342,323
Other Liabilities(a)	$	—	$	17,086	$	—	$	17,086
Total Liabilities	$	—	$	17,086	$	—	$	17,086

(a) Non-hedging interest rate derivatives

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Obligations of U.S. Government Agencies:
Mortgage-Backed Securities—Residential	$	—	$	31,664	$	—	$	31,664
Obligations of U.S. Government-Sponsored Enterprises:
Mortgage-Backed Securities—Residential	—		864,401		—		864,401
Mortgage-Backed Securities—Commercial	—		149		—		149
Other Government-Sponsored Enterprises	—		242,664		—		242,664
Obligations of States and Political Subdivisions	—		86		—		86
Corporate Securities	—		6,991		—		6,991
Pooled Trust Preferred Collateralized Debt Obligations	—		—		23,373		23,373
Total Debt Securities	—		1,145,955		23,373		1,169,328
Equities	555		—		1,420		1,975
Total Securities Available for Sale	555		1,145,955		24,793		1,171,303
Other Investments	—		28,228		—		28,228
Loans Held for Sale	—		—		—		—
Other Assets(a)	—		16,480		—		16,480
Total Assets	$	555	$	1,190,663	$	24,793	$	1,216,011
Other Liabilities(a)	$	—	$	18,726	$	—	$	18,726
Total Liabilities	$	—	$	18,726	$	—	$	18,726

(a) Non-hedging interest rate derivatives

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

For the three-month periods ended March 31, changes in Level 3 assets and liabilities measured at fair value on a recurring basis are summarized as follows:

	2013
	Pooled Trust Preferred Collateralized Debt Obligations			Equities		Loans Held for Sale			Other Assets		Total
	(dollars in thousands)
Balance, beginning of period	$	23,373		$	1,420	$	—		$	—	$	24,793
Total gains or losses
Included in earnings	—			—		126			—		126
Included in other comprehensive income	2,391			—		—			—		2,391
Purchases, issuances, sales, and settlements
Purchases	—			—		—			—		—
Issuances	—			—		—			—		—
Sales	—			—		(16,739		)	—		(16,739		)
Settlements	(1,252		)	—		—			—		(1,252		)
Transfers into Level 3	—			—		16,613			—		16,613
Balance, end of period	$	24,512		$	1,420	$	—		$	—	$	25,932

	2012
	Pooled Trust Preferred Collateralized Debt Obligations			Equities		Loans Held for Sale			Other Assets			Total
	(dollars in thousands)
Balance, beginning of period	$	22,980		$	1,420	$	13,412		$	—		$	37,812
Total gains or losses
Included in earnings	—			—		1,768			(461		)	1,307
Included in other comprehensive income	2,268			—		—			—			2,268
Purchases, issuances, sales, and settlements
Purchases	—			—		—			—			—
Issuances	—			—		—			—			—
Sales	—			—		(6,809		)	—			(6,809		)
Settlements	(740		)	—		(295		)	—			(1,035		)
Transfers into Level 3	—			—		—			461			461
Balance, end of period	$	24,508		$	1,420	$	8,076		$	—		$	34,004

Schedule of Assets Measured on Non-Recurring Basis

The tables below present the balances of assets measured at fair value on a non-recurring basis at:

	March 31, 2013
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Impaired loans	$	—	$	57,636	$	7,956	$	65,592
Other real estate owned	—		11,389		215		11,604
Total Assets	$	—	$	69,025	$	8,171	$	77,196

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Impaired loans	$	—	$	82,949	$	6,827	$	89,776
Other real estate owned	—		11,981		247		12,228
Total Assets	$	—	$	94,930	$	7,074	$	102,004

Losses Realized on Assets Measured on Non-Recurring Basis

The following losses were realized on the assets measured on a nonrecurring basis:

	For the Three-Months Ended March 31,
	2013			2012
	(dollars in thousands)
Impaired loans	$	(503	)	$	(376	)
Other real estate owned	(131		)	(2,909		)
Total losses	$	(634	)	$	(3,285	)

Carrying Amounts and Fair Values of Financial Instruments

The following table presents carrying amounts and fair values of First Commonwealth’s financial instruments:

	March 31, 2013
			Fair Value Measurements Using:
	Carrying Amount		Total		Level 1		Level 2		Level 3
	(dollars in thousands)
Financial assets
Cash and due from banks	$	53,991	$	53,991	$	53,991	$	—	$	—
Interest-bearing deposits	1,780		1,780		1,780		—		—
Securities available for sale	1,297,203		1,297,203		513		1,270,758		25,932
Other investments	28,357		28,357		—		28,357		—
Loans	4,218,810		4,291,687		—		57,636		4,234,051
Financial liabilities
Deposits	4,711,578		4,645,967		—		4,645,967		—
Short-term borrowings	308,100		308,092		—		308,092		—
Long-term debt	174,318		176,295		—		176,295		—
Subordinated debt	105,750		79,539		—		34,699		44,840

	December 31, 2012
			Fair Value Measurements Using:
	Carrying Amount		Total		Level 1		Level 2		Level 3
	(dollars in thousands)
Financial assets
Cash and due from banks	$	98,724	$	98,724	$	98,724	$	—	$	—
Interest-bearing deposits	4,258		4,258		4,258		—		—
Securities available for sale	1,171,303		1,171,303		555		1,145,955		24,793
Other investments	28,228		28,228		—		28,228		—
Loans	4,204,704		4,245,114		—		82,949		4,162,165
Financial liabilities
Deposits	4,557,881		4,493,764		—		4,493,764		—
Short-term borrowings	356,227		356,221		—		356,221		—
Long-term debt	174,471		176,178		—		176,178		—
Subordinated debt	105,750		76,735		—		—		76,735