FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2016

Summary of Fair Value Measured on a Recurring Basis

The following tables set forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis. There were no transfers between any of the levels for the periods presented.

	March 31, 2016
(000's omitted)	Level 1		Level 2			Level 3		Total Fair Value
Available-for-sale investment securities:
U.S. Treasury and agency securities	$	1,963,543	$	0		$	0	$	1,963,543
Obligations of state and political subdivisions		0		662,392			0		662,392
Government agency mortgage-backed securities		0		215,271			0		215,271
Corporate debt securities		0		16,684			0		16,684
Government agency collateralized mortgage obligations		0		12,436			0		12,436
Marketable equity securities		410		0			0		410
Total available-for-sale investment securities		1,963,953		906,783			0		2,870,736
Mortgage loans held for sale		0		339			0		339
Commitments to originate real estate loans for sale		0		0			282		282
Forward sales commitments		0		(46	)		0		(46	)
Total	$	1,963,953	$	907,076		$	282	$	2,871,311

	December 31, 2015
(000's omitted)	Level 1		Level 2			Level 3		Total Fair Value
Available-for-sale investment securities:
U.S. Treasury and agency securities	$	1,899,978	$	0		$	0	$	1,899,978
Obligations of state and political subdivisions		0		666,883			0		666,883
Government agency mortgage-backed securities		0		210,865			0		210,865
Corporate debt securities		0		16,680			0		16,680
Government agency collateralized mortgage obligations		0		13,308			0		13,308
Marketable equity securities		399		0			0		399
Total available-for-sale investment securities		1,900,377		907,736			0		2,808,113
Mortgage loans held for sale		0		932			0		932
Commitments to originate real estate loans for sale		0		0			117		117
Forward sales commitments		0		(37	)		0		(37	)
Total	$	1,900,377	$	908,631		$	117	$	2,809,125

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

The changes in Level 3 assets measured at fair value on a recurring basis are summarized in the following tables:

	Three Months Ended March 31,
	2016			2015
(000's omitted)	Commitments to Originate Real Estate Loans for Sale			Commitments to Originate Real Estate Loans for Sale
Beginning balance	$	117		$	185
Total (losses)/gains included in earnings⁽¹⁾		(117	)		(185	)
Commitments to originate real estate loans held for sale, net		282			152
Ending balance	$	282		$	152

⁽¹⁾	Amounts included in earnings associated with the commitments to originate real estate loans for sale are reported as a component of other banking services in the Consolidated Statement of Income.

Assets and Liabilities Measured on a Non-Recurring Basis

The fair value information of assets and liabilities measured on a non-recurring basis presented below is not as of the period-end, but rather as of the date the fair value adjustment was recorded closest to the date presented.

	March 31, 2016								December 31, 2015
(000's omitted)	Level 1		Level 2		Level 3		Total Fair Value		Level 1		Level 2		Level 3		Total Fair Value
Impaired loans	$	0	$	0	$	2,280	$	2,280	$	0	$	0	$	1,765	$	1,765
Other real estate owned		0		0		2,031		2,031		0		0		2,088		2,088
Total	$	0	$	0	$	4,311	$	4,311	$	0	$	0	$	3,853	$	3,853

Significant Unobservable Inputs, Fair Value Valuation Techniques

The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis are as follows:

(000's omitted)	Fair Value at March 31, 2016		Valuation Technique	Significant Unobservable Inputs	Significant Unobservable Input Range (Weighted Average)
Other real estate owned	$	2,031	Fair Value of Collateral	Estimated cost of disposal/market adjustment		10.0% - 74.0% (31.4%)
Impaired loans		2,280	Fair Value of Collateral	Estimated cost of disposal/market adjustment		9% - 40% (25.8%)
Commitments to originate real estate loans for sale		282	Discounted cash flow	Embedded servicing value		1%

(000's omitted)	Fair Value at December 31, 2015		Valuation Technique	Significant Unobservable Inputs	Significant Unobservable Input Range (Weighted Average)
Other real estate owned	$	2,088	Fair value of collateral	Estimated cost of disposal/market adjustment		5.3% - 74.0% (27.7%)
Impaired loans		1,765	Fair value of collateral	Estimated cost of disposal/market adjustment		9.0% - 20.0% (17.9%)
Commitments to originate real estate loans for sale		117	Discounted cash flow	Embedded servicing value		1%

Carrying Amounts and Estimated Fair Values of Other Financial Instruments

The carrying amounts and estimated fair values of the Company’s other financial instruments that are not accounted for at fair value at March 31, 2016 and December 31, 2015 are as follows:

	March 31, 2016				December 31, 2015
(000's omitted)	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets:
Net loans	$	4,775,576	$	4,839,485	$	4,755,974	$	4,808,856
Financial liabilities:
Deposits		7,119,062		7,117,700		6,873,474		6,871,098
Borrowings		33,700		33,700		301,300		301,300
Subordinated debt held by unconsolidated subsidiary trusts		102,152		84,144		102,146		84,680