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FAIR VALUE DISCLOSURES (Tables)
 12 Months Ended
Dec. 31, 2012
Fair Value Disclosures [Abstract]  
Schedule of assets measured at fair value on a recurring basis

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

 

    December 31, 2012  
    Fair Value Measurements Using     Assets  
    Level 1     Level 2     Level 3     at Fair Value  
          (in thousands)        
Assets                                
                                 
U.S. Treasury securities   $ 1,037     $ 0     $ 0     $ 1,037  
U.S. Government sponsored agencies     0       5,304       0       5,304  
Mortgage-backed securities     0       365,644       0       365,644  
Non-agency residential mortgage-backed securities     0       3,594       2,859       6,453  
State and municipal securities     0       87,595       988       88,583  
Total Securities     1,037       462,137       3,847       467,021  
                                 
Mortgage banking derivative     0       739       0       739  
                                 
Total assets   $ 1,037     $ 462,876     $ 3,847     $ 467,760  
                                 
Liabilities                                
                                 
Mortgage banking derivative   $ 0     $ 12     $ 0     $ 12  

 

    December 31, 2011  
    Fair Value Measurements Using     Assets  
    Level 1     Level 2     Level 3     at Fair Value  
          (in thousands)              
Assets                                
                                 
U.S. Treasury securities   $ 1,055     $ 0     $ 0     $ 1,055  
U.S. Government sponsored agencies     0       5,277       0       5,277  
Mortgage-backed securities     0       350,102       0       350,102  
Non-agency residential mortgage-backed securities     0       32,207       0       32,207  
State and municipal securities     0       78,064       686       78,750  
Total Securities     1,055       465,650       686       467,391  
                                 
Mortgage banking derivative     0       406       0       406  
                                 
Total assets   $ 1,055     $ 466,056     $ 686     $ 467,797  
                                 
Liabilities                                
                                 
Mortgage banking derivative   $ 0     $ 81     $ 0     $ 81  
Schedule of reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31, 2012 and 2011:

 

    Non-Agency Residential              
    Mortgage-Backed Securities     State and Municipal Securities  
    2012     2011     2012     2011  
    (in thousands)     (in thousands)  
Balance of recurring Level 3 assets at January 1   $ 0     $ 0     $ 686     $ 0  
Transfers into Level 3     2,859       0       351       686  
Changes in fair value of securities     0       0       (4 )     0  
Principal payments     0       0       (45 )     0  
Balance of recurring Level 3 assets at December 31   $ 2,859     $ 0     $ 988     $ 686  
Fair Value Measurements, Recurring, Valuation Techniques

The state and municipal securities measured at fair value included below are nonrated Indiana municipal revenue bonds and are not actively traded.

 

Quantitative Information about Level 3 Fair Value Measurements
    Fair Value at             Range of Inputs
    12/31/2012     Valuation Technique   Unobservable Input   (Average)
    (in thousands)              
                   
Non-agency residential mortgage-backed securities   $ 2,859     Discounted cash flow   Constant prepayment rate   5.00-9.00
                    (6.00)
                     
                Average life   0.20-2.86
                    (2.70)
                     
                Swap/EDSF spread   297-339
                    (328)
                     
State and municipal securities   $ 988     Price to type, par, call   Discount to benchmark index   1-11%
                    (4%)
Schedule of assets measured at fair value on a nonrecurring basis

The table below presents the balances of assets measured at fair value on a nonrecurring basis:

 

    December 31, 2012  
    Fair Value Measurements Using     Assets  
    Level 1     Level 2     Level 3     at Fair Value  
          (in thousands)        
Assets                                
                                 
Impaired loans:                                
Commercial and industrial loans:                                
Working capital lines of credit loans   $ 0     $ 0     $ 990     $ 990  
Non-working capital loans     0       0       2,990       2,990  
                                 
Commercial real estate and multi-family residential loans:                                
Construction and land development loans     0       0       2,026       2,026  
Owner occupied loans     0       0       3,892       3,892  
Nonowner occupied loans     0       0       18,642       18,642  
Multifamily loans     0       0       0       0  
                                 
Agri-business and agricultural loans:                                
Loans secured by farmland     0       0       268       268  
Loans for agricultural production     0       0       0       0  
                                 
Other commercial loans     0       0       0       0  
                                 
Consumer 1-4 family mortgage loans:                                
Closed end first mortgage loans     0       0       352       352  
Open end and junior lien loans     0       0       158       158  
Residential construction loans     0       0       0       0  
                                 
Other consumer loans     0       0       46       46  
                                 
Total impaired loans   $ 0     $ 0     $ 29,364     $ 29,364  
                                 
Mortgage servicing rights     0       0       1,906       1,906  
Other real estate owned     0       0       75       75  
                                 
Total assets   $ 0     $ 0     $ 31,345     $ 31,345  

 

 

    Level 1     Level 2     Level 3     at Fair Value  
          (in thousands)        
Assets                                
                                 
Impaired loans:                                
Commercial and industrial loans:                                
Working capital lines of credit loans   $ 0     $ 0     $ 2,762     $ 2,762  
Non-working capital loans     0       0       11,885       11,885  
                                 
Commercial real estate and multi-family residential loans:                                
Construction and land development loans     0       0       303       303  
Owner occupied loans     0       0       3,515       3,515  
Nonowner occupied loans     0       0       23,591       23,591  
Multifamily loans     0       0       0       0  
                                 
Agri-business and agricultural loans:                                
Loans secured by farmland     0       0       433       433  
Loans for agricultural production     0       0       207       207  
                                 
Other commercial loans     0       0       0       0  
                                 
Consumer 1-4 family mortgage loans:                                
Closed end first mortgage loans     0       0       878       878  
Open end and junior lien loans     0       0       406       406  
Residential construction loans     0       0       0       0  
                                 
Other consumer loans     0       0       0       0  
                                 
Total impaired loans   $ 0     $ 0     $ 43,980     $ 43,980  
                                 
Mortgage servicing rights     0       0       1,734       1,734  
Other real estate owned     0       0       730       730  
                                 
Total assets   $ 0     $ 0     $ 46,444     $ 46,444
Fair Value Measured On Nonrecurring Basis Valuation Techniques

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2012:

Fair Value Valuation Methodology Unobservable Inputs Average Range of Inputs
Impaired Loans:
Commercial and industrial: $ 3,980 Collateral based Discount to reflect 35 % (10% - 99%)
measurements current market conditions
and ultimate collectability
Impaired loans:
Commercial real estate: 24,560 Collateral based Discount to reflect 23 % (4% - 57%)
measurements current market conditions
and ultimate collectability
Impaired loans:
Agri-business and agricultural: 268 Collateral based Discount to reflect 19 %
measurements current market conditions
and ultimate collectability
Impaired loans:
Consumer 1-4 family mortgage 510 Collateral based Discount to reflect 39 % (8% - 100%)
measurements current market conditions
and ultimate collectability
Impaired loans:
Other consumer 46 Collateral based Discount to reflect 40 % (29% - 100%)
measurements current market conditions
and ultimate collectability
Mortgage servicing rights 1,906 Discounted cash flows Discount rate 9.20 % (9.10% - 9.50%)
Other real estate owned 75 Appraisals Discount to reflect 49 %
current market conditions

Schedule of fair values and the related carrying values of financial instruments

The following table contains the estimated fair values and the related carrying values of the Company’s financial instruments at December 31, 2012 and 2011. Items which are not financial instruments are not included.

 

    December 31, 2012  
    Carrying     Estimated Fair Value  
    Value     Level 1     Level 2     Level 3     Total  
                               
Financial Assets:                                        
Cash and cash equivalents   $ 232,237     $ 232,237     $ 0     $ 0     $ 232,237  
Securities available for sale     467,021       1,037       462,137       3,847       467,021  
Real estate mortgages held for sale     9,452       0       9,663       0       9,663  
Loans, net     2,206,075       0       0       2,230,993       2,230,993  
Federal Home Loan Bank stock     7,313       N/A       N/A       N/A       N/A  
Federal Reserve Bank stock     3,420       N/A       N/A       N/A       N/A  
Accrued interest receivable     8,485       6       2,215       6,264       8,485  
Financial Liabilities:                                        
Certificates of deposit     (907,505 )     0       (922,397 )     0       (922,397 )
All other deposits     (1,674,251 )     (1,674,251 )     0       0       (1,674,251 )
Securities sold under agreements to repurchase     (121,883 )     0       (121,883 )     0       (121,883 )
Long-term borrowings     (15,038 )     0       (15,607 )     0       (15,607 )
Subordinated debentures     (30,928 )     0       0       (31,223 )     (31,223 )
Standby letters of credit     (262 )     0       0       (262 )     (262 )
Accrued interest payable     (4,757 )     (298 )     (4,456 )     (3 )     (4,757 )

 

    December 31, 2011  
    Carrying     Estimated  
    Value     Fair Value  
             
Financial Assets:                
Cash and cash equivalents   $ 104,584     $ 104,584  
Securities available for sale     467,391       467,391  
Real estate mortgages held for sale     2,953       2,998  
Loans, net     2,180,309       2,141,459  
Federal Home Loan Bank stock     7,313       N/A  
Federal Reserve Bank stock     3,420       N/A  
Accrued interest receivable     9,604       9,604  
Financial Liabilities:                
Certificates of deposit     (910,381 )     (925,619 )
All other deposits     (1,502,315 )     (1,502,315 )
Securities sold under agreements to repurchase     (131,990 )     (131,990 )
Other short-term borrowings     (10,000 )     (10,000 )
Long-term borrowings     (15,040 )     (16,079 )
Subordinated debentures     (30,928 )     (31,240 )
Standby letters of credit     (247 )     (247 )
Accrued interest payable     (5,574 )     (5,574 )