Fair Value Measurement of Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2015

Assets and Liabilities Measured at Fair Value on Recurring and Non-Recurring Basis

The following tables present the assets and liabilities that are measured at fair value on a recurring and non-recurring basis by level within the fair value hierarchy as reported on the consolidated statements of financial condition at December 31, 2015 and 2014. The assets presented under “non-recurring fair value measurements” in the table below are not measured at fair value on an ongoing basis but are subject to fair value adjustments under certain circumstances (e.g., when an impairment loss is recognized).



			Fair Value Measurements at Reporting Date Using:
	December 31, 2015		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Recurring fair value measurements:
Assets
Investment securities:
Available for sale:
U.S. Treasury securities	$	549,473	$	549,473	$	—	$	—
U.S. government agency securities	29,963		—		29,963		—
Obligations of states and political subdivisions	124,966		—		124,966		—
Residential mortgage-backed securities	696,428		—		684,777		11,651
Trust preferred securities	8,404		—		6,262		2,142
Corporate and other debt securities	77,552		17,710		59,842		—
Equity securities	20,075		1,198		18,877		—
Total available for sale	1,506,861		568,381		924,687		13,793
Loans held for sale ⁽¹⁾	16,382		—		16,382		—
Other assets ⁽²⁾	33,774		—		33,774		—
Total assets	$	1,557,017	$	568,381	$	974,843	$	13,793
Liabilities
Other liabilities ⁽²⁾	$	50,844	$	—	$	50,844	$	—
Total liabilities	$	50,844	$	—	$	50,844	$	—
Non-recurring fair value measurements:
Collateral dependent impaired loans ⁽³⁾	$	15,427	$	—	$	—	$	15,427
Loan servicing rights	2,571		—		—		2,571
Foreclosed assets ⁽⁴⁾	16,672		—		—		16,672
Total	$	34,670	$	—	$	—	$	34,670



			Fair Value Measurements at Reporting Date Using:
	December 31, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Recurring fair value measurements:
Assets
Investment securities:
Available for sale:
U.S. Treasury securities	$	49,443	$	49,443	$	—	$	—
U.S. government agency securities	33,825		—		33,825		—
Obligations of states and political subdivisions	44,051		—		44,051		—
Residential mortgage-backed securities	644,276		—		629,696		14,580
Trust preferred securities	20,537		—		15,808		4,729
Corporate and other debt securities	74,012		18,241		55,771		—
Equity securities	20,826		1,337		19,489		—
Total available for sale	886,970		69,021		798,640		19,309
Trading securities	14,233		—		14,233		—
Loans held for sale ⁽¹⁾	17,165		—		17,165		—
Other assets ⁽²⁾	20,987		—		20,987		—
Total assets	$	939,355	$	69,021	$	851,025	$	19,309
Liabilities
Other liabilities ⁽²⁾	33,330		—		33,330		—
Total liabilities	$	33,330	$	—	$	33,330	$	—
Non-recurring fair value measurements:
Non-performing loans held for sale	$	7,130	$	—	$	—	$	7,130
Collateral dependent impaired loans ⁽³⁾	13,985		—		—		13,985
Loan servicing rights	3,987		—		—		3,987
Foreclosed assets ⁽⁴⁾	18,098		—		—		18,098
Total	$	43,200	$	—	$	—	$	43,200


⁽¹⁾	Loans held for sale (which consist of residential mortgages) are carried at fair value and had contractual unpaid principal balances totaling approximately $16.1 million and $16.9 million at December 31, 2015 and 2014, respectively.


⁽²⁾	Amount represents derivative financial instruments.


⁽³⁾	Excludes PCI loans.


⁽⁴⁾	Includes covered other real estate owned totaling $4.2 million and $3.2 million at December 31, 2015 and 2014, respectively.

Changes in Level 3 Assets Measured at Fair Value on Recurring Basis

The changes in Level 3 assets measured at fair value on a recurring basis for the years ended December 31, 2015, 2014 and 2013 are summarized below:



	Available For Sale Securities
	2015			2014			2013
	(in thousands)
Balance, beginning of the period	$	19,309		$	28,523		$	71,674
Net (losses) gains included in other comprehensive income	(1,072		)	1,648			657
Sales	(2,674		)	(7,718		)	(36,681		)
Settlements	(1,770		)	(3,144		)	(7,127		)
Balance, end of the period	$	13,793		$	19,309		$	28,523

Schedule of Quantitative Information about Level 3 Inputs Used to Measure Fair Value of Available for Sale Securities

The following table presents quantitative information about Level 3 inputs used to measure the fair value of these securities at December 31, 2015:



Security Type	Valuation Technique	Unobservable Input	Range	Weighted Average
Private label mortgage-backed securities	Discounted cash flow	Prepayment rate	0.1 - 22.2%	11.7	%
		Default rate	3.7 - 20.6	8.5
		Loss severity	41.4 - 64.6	58.5

Carrying Amounts and Estimated Fair Values of Financial Instruments

The carrying amounts and estimated fair values of financial instruments not measured and not reported at fair value on the consolidated statements of financial condition at December 31, 2015 and 2014 were as follows:



		December 31,
		2015				2014
	Fair Value Hierarchy	Carrying Amount		Fair Value		Carrying Amount		Fair Value
		(in thousands)
Financial assets
Cash and due from banks	Level 1	$	243,575	$	243,575	$	462,569	$	462,569
Interest bearing deposits with banks	Level 1	170,225		170,225		367,838		367,838
Investment securities held to maturity:
U.S. Treasury securities	Level 1	138,978		149,483		139,121		151,300
U.S. government agency securities	Level 2	12,859		13,130		14,081		14,385
Obligations of states and political subdivisions	Level 2	504,865		527,263		500,018		519,693
Residential mortgage-backed securities	Level 2	852,289		855,272		986,992		998,981
Trust preferred securities	Level 2	59,785		46,437		98,456		86,243
Corporate and other debt securities	Level 2	27,609		29,454		39,648		45,374
Total investment securities held to maturity		1,596,385		1,621,039		1,778,316		1,815,976
Net loans	Level 3	15,936,929		15,824,475		13,371,560		13,085,830
Accrued interest receivable	Level 1	63,554		63,554		57,333		57,333
Federal Reserve Bank and Federal Home Loan Bank stock ⁽¹⁾	Level 1	145,068		145,068		133,117		133,117
Financial liabilities
Deposits without stated maturities	Level 1	13,095,647		13,095,647		11,291,646		11,291,648
Deposits with stated maturities	Level 2	3,157,904		3,203,389		2,742,468		2,807,522
Short-term borrowings	Level 1	1,076,991		1,076,991		146,781		146,781
Long-term borrowings	Level 2	1,810,728		1,945,741		2,526,408		2,738,122
Junior subordinated debentures issued to capital trusts	Level 2	41,414		44,127		41,252		44,584
Accrued interest payable ⁽²⁾	Level 1	13,110		13,110		15,526		15,526


⁽¹⁾	Included in other assets.


⁽²⁾	Included in accrued expenses and other liabilities.