Fair Values of Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value Inputs, Assets, Quantitative Information

In accordance with ASU No. 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)
March 31, 2022
Other Investments	$	1,170		Carrying Value	N/A	N/A
Nonperforming Loans	538		(a)	Gas Reserve Study	Discount rate	10.00%
					Gas per MMBTU	$3.00 - $3.00 (b)
					Oil per BBL/d	$80.00 - $80.00 (b)
Limited Partnership Investments	15,999			Par Value	N/A	N/A
December 31, 2021
Other Investments	$	1,170		Carrying Value	N/A	N/A
Nonperforming Loans	598		(a)	Gas Reserve Study	Discount rate	10.00%
					Gas per MMBTU	$2.00 - $2.00 (b)
					Oil per BBL/d	$50.00 - $50.00 (b)
Limited Partnership Investments	14,981			Par Value	N/A	N/A

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

(b)Unobservable inputs are defined as follows: MMBTU - one million British thermal units; BBL/d - barrels per day.

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, 2022
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Obligations of U.S. Government Agencies:
Mortgage-Backed Securities - Residential	$	—	$	5,066	$	—	$	5,066
Mortgage-Backed Securities - Commercial	—		329,228		—		329,228
Obligations of U.S. Government-Sponsored Enterprises:
Mortgage-Backed Securities - Residential	—		557,259		—		557,259
Other Government-Sponsored Enterprises	—		935		—		935
Obligations of States and Political Subdivisions	—		8,922		—		8,922
Corporate Securities	—		31,794		—		31,794
Total Securities Available for Sale	—		933,204		—		933,204
Other Investments	—		11,972		1,170		13,142
Loans Held for Sale	—		10,506		—		10,506
Other Assets(a)	—		10,326		15,999		26,325
Total Assets	$	—	$	966,008	$	17,169	$	983,177
Other Liabilities(a)	$	—	$	34,496	$	—	$	34,496
Total Liabilities	$	—	$	34,496	$	—	$	34,496

(a)Hedging and non-hedging interest rate derivatives and limited partnership investments

	December 31, 2021
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Obligations of U.S. Government Agencies:
Mortgage-Backed Securities - Residential	$	—	$	5,662	$	—	$	5,662
Mortgage-Backed Securities - Commercial	—		362,290		—		362,290
Obligations of U.S. Government-Sponsored Enterprises:
Mortgage-Backed Securities - Residential	—		629,974		—		629,974
Other Government-Sponsored Enterprises	—		981		—		981
Obligations of States and Political Subdivisions	—		9,524		—		9,524
Corporate Securities	—		32,949		—		32,949
Total Securities Available for Sale	—		1,041,380		—		1,041,380
Other Investments	—		11,668		1,170		12,838
Loans Held for Sale	—		18,583		—		18,583
Other Assets(a)	—		26,805		14,981		41,786
Total Assets	$	—	$	1,098,436	$	16,151	$	1,114,587
Other Liabilities(a)	$	—	$	34,263	$	—	$	34,263
Total Liabilities	$	—	$	34,263	$	—	$	34,263

(a)Hedging and non-hedging interest rate derivatives

Schedule of Assets Measured on Non-Recurring Basis

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

	March 31, 2022
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Nonperforming loans	$	—	$	25,306	$	11,810	$	37,116
Other real estate owned	—		732		—		732
Total Assets	$	—	$	26,038	$	11,810	$	37,848

	December 31, 2021
	Level 1		Level 2		Level 3		Total
	(dollars in thousands)
Nonperforming loans	$	—	$	42,538	$	12,247	$	54,785
Other real estate owned	—		729		—		729
Total Assets	$	—	$	43,267	$	12,247	$	55,514

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques

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

	2022
	Other Investments		Other Assets		Total
	(dollars in thousands)
Balance, beginning of period	$	1,170	$	14,981	$	16,151
Total gains or losses
Included in earnings	—		—		—
Included in other comprehensive income	—		—		—
Purchases, issuances, sales and settlements
Purchases	—		1,043		1,043
Issuances	—		—		—
Sales	—		(25)		(25)
Settlements	—		—		—
Transfers from Level 3	—		—		—
Transfers into Level 3	—		—		—
Balance, end of period	$	1,170	$	15,999	$	17,169

 

	2021
	Other Investments		Other Assets		Total
	(dollars in thousands)
Balance, beginning of period	$	1,670	$	6,620	$	8,290
Total gains or losses
Included in earnings	—		—		—
Included in other comprehensive income	—		—		—
Purchases, issuances, sales and settlements
Purchases	—		390		390
Issuances	—		—		—
Sales	—		—		—
Settlements	—		—		—
Transfers from Level 3	—		—		—
Transfers into Level 3	—		—		—
Balance, end of period	$	1,670	$	7,010	$	8,680

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,
		2022		2021
	(dollars in thousands)
Nonperforming loans		$	(171)	$	205
Other real estate owned		(54)		(6)
Total losses		$	(225)	$	199

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, 2022
			Fair Value Measurements Using:
	Carrying Amount		Total		Level 1		Level 2		Level 3
	(dollars in thousands)
Financial assets
Cash and due from banks	$	120,289	$	120,289	$	120,289	$	—	$	—
Interest-bearing deposits	404,516		404,516		404,516		—		—
Securities available for sale	933,204		933,204		—		933,204		—
Securities held to maturity	512,911		477,088		—		477,088		—
Other investments	13,142		13,142		—		11,972		1,170
Loans held for sale	10,506		10,506		—		10,506		—
Loans	6,952,112		7,154,726		—		25,306		7,129,420
Financial liabilities
Deposits	8,171,847		8,164,467		—		8,164,467		—
Short-term borrowings	95,748		93,203		—		93,203		—
Subordinated debt	170,815		168,231		—		—		168,231
Long-term debt	5,398		5,587		—		5,587		—
Capital lease obligation	5,799		5,799		—		5,799		—

	December 31, 2021
			Fair Value Measurements Using:
	Carrying Amount		Total		Level 1		Level 2		Level 3
	(dollars in thousands)
Financial assets
Cash and due from banks	$	84,738	$	84,738	$	84,738	$	—	$	—
Interest-bearing deposits	310,634		310,634		310,634		—		—
Securities available for sale	1,041,380		1,041,380		—		1,041,380		—
Securities held to maturity	541,311		536,651		—		536,651		—
Other investments	12,838		12,838		—		11,668		1,170
Loans held for sale	18,583		18,583		—		18,583		—
Loans	6,839,230		7,169,768		—		42,538		7,127,230
Financial liabilities
Deposits	7,982,498		7,980,101		—		7,980,101		—
Short-term borrowings	138,315		136,473		—		136,473		—
Subordinated debt	170,775		175,040		—		—		175,040
Long-term debt	5,573		6,065		—		6,065		—
Capital lease obligation	5,921		5,921		—		5,921		—