FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2021

FAIR VALUE

Fair Value Measured on a Recurring Basis

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. 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, 2021
							Total Fair
(000’s omitted)	Level 1		Level 2		Level 3		Value
Available-for-sale investment securities:
U.S. Treasury and agency securities	$	2,632,967	$	123,291	$	0	$	2,756,258
Obligations of state and political subdivisions		0		450,171		0		450,171
Government agency mortgage-backed securities		0		544,986		0		544,986
Corporate debt securities		0		3,082		0		3,082
Government agency collateralized mortgage obligations		0		36,894		0		36,894
Total available-for-sale investment securities		2,632,967		1,158,424		0		3,791,391
Equity securities		469		0		0		469
Mortgage loans held for sale		0		292		0		292
Commitments to originate real estate loans for sale		0		0		34		34
Forward sales commitments		0		50		0		50
Interest rate swap agreements asset		0		707		0		707
Interest rate swap agreements liability		0		(388)		0		(388)
Total	$	2,633,436	$	1,159,085	$	34	$	3,792,555

	December 31, 2020
							Total Fair
(000’s omitted)	Level 1		Level 2		Level 3		Value
Available-for-sale investment securities:
U.S. Treasury and agency securities	$	2,359,912	$	141,470	$	0	$	2,501,382
Obligations of state and political subdivisions		0		475,660		0		475,660
Government agency mortgage-backed securities		0		522,638		0		522,638
Corporate debt securities		0		4,635		0		4,635
Government agency collateralized mortgage obligations		0		43,577		0		43,577
Total available-for-sale investment securities		2,359,912		1,187,980		0		3,547,892
Equity securities		445		0		0		445
Mortgage loans held for sale		0		1,622		0		1,622
Commitments to originate real estate loans for sale		0		0		14		14
Forward sales commitments		0		2		0		2
Interest rate swap agreements asset		0		1,572		0		1,572
Interest rate swap agreements liability		0		(1,074)		0		(1,074)
Total	$	2,360,357	$	1,190,102	$	14	$	3,550,473

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, 2021								December 31, 2020
							Total Fair								Total Fair
(000’s omitted)	Level 1		Level 2		Level 3		Value		Level 1		Level 2		Level 3		Value
Impaired loans	$	0	$	0	$	21,647	$	21,647	$	0	$	0	$	25,063	$	25,063
Business loans held for sale		0		0		848		848		0		0		0		0
Other real estate owned		0		0		824		824		0		0		883		883
Mortgage servicing rights		0		0		807		807		0		0		682		682
Total	$	0	$	0	$	24,126	$	24,126	$	0	$	0	$	26,628	$	26,628

Significant Unobservable Inputs, Fair Value Valuation Techniques

The Company determines fair values based on quoted market values, where available, estimates of present values, or other valuation techniques. Those techniques are significantly affected by the assumptions used, including, but not limited to, the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in immediate settlement of the instrument. 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:

					Significant
					Unobservable Input
	Fair Value at				Range
(000's omitted, except per loan data)	March 31, 2021		Valuation Technique	Significant Unobservable Inputs	(Weighted Average)
Impaired loans	$	21,647	Fair value of collateral	Estimated cost of disposal/market adjustment		9.0% - 78.7% (54.3%)
Business loans held for sale		848	Fair value of collateral	Estimated cost of disposal/market adjustment		9.0% - 35.0% (27.9%)
Other real estate owned		824	Fair value of collateral	Estimated cost of disposal/market adjustment		31.8% - 97.5% (42.0%)
Commitments to originate real estate loans for sale		34	Discounted cash flow	Embedded servicing value		1	%
Mortgage servicing rights		807	Discounted cash flow	Weighted average constant prepayment rate		13.7% - 27.0% (15.7%)
				Weighted average discount rate		2.49% - 3.06% (2.97%)
				Adequate compensation	$	7/loan

					Significant
					Unobservable Input
	Fair Value at				Range
(000's omitted, except per loan data)	December 31, 2020		Valuation Technique	Significant Unobservable Inputs	(Weighted Average)
Impaired loans	$	25,063	Fair value of collateral	Estimated cost of disposal/market adjustment		9.0% - 78.4% (52.7%)
Other real estate owned		883	Fair value of collateral	Estimated cost of disposal/market adjustment		11.3% - 52.9% (34.0%)
Commitments to originate real estate loans for sale		14	Discounted cash flow	Embedded servicing value		1.0	%
Mortgage servicing rights		682	Discounted cash flow	Weighted average constant prepayment rate		9.8% - 18.8% (17.6%)
				Weighted average discount rate		1.7% - 2.2% (2.1%)
				Adequate compensation	$	7/loan

Carrying Amounts and Estimated Fair Values of Other Financial Instruments

Certain financial instruments and all nonfinancial instruments are excluded from fair value disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. 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, 2021 and December 31, 2020 are as follows:

	March 31, 2021				December 31, 2020
	Carrying		Fair		Carrying		Fair
(000’s omitted)	Value		Value		Value		Value
Financial assets:
Net loans	$	7,313,258	$	7,565,204	$	7,355,083	$	7,655,044
Financial liabilities:
Deposits		12,204,237		12,215,473		11,224,974		11,239,628
Securities sold under agreement to repurchase, short-term		257,767		257,767		284,008		284,008
Other Federal Home Loan Bank borrowings		5,959		6,031		6,658		6,758
Subordinated notes payable		3,297		3,297		3,303		3,303
Subordinated debt held by unconsolidated subsidiary trusts		0		0		77,320		77,320