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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2022

Schedule of Financial Assets and Liabilities Measured at Fair Value

The following tables present the balances of financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021, segregated by the level of the valuation inputs within the fair value hierarchy.


			Fair Value at June 30, 2022 Using
Description	Balance as of June 30, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Available for sale debt securities:
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	493,256	$	0	$	493,256	$	0
State and political subdivisions		751,077		0		751,077		0
Residential mortgage-backed securities
Agency		1,295,001		0		1,295,001		0
Non-agency		108,638		0		108,638		0
Commercial mortgage-backed securities
Agency		641,590		0		641,590		0
Asset-backed securities		917,624		0		917,624		0
Single issue trust preferred securities		16,203		0		16,203		0
Other corporate securities		589,315		5,540		583,775		0

Total available for sale securities		4,812,704		5,540		4,807,164		0
Equity securities:
Financial services industry		211		211		0		0
Equity mutual funds (1)		7,949		7,949		0		0
Other equity securities		5,353		5,353		0		0

Total equity securities		13,513		13,513		0		0
Loans held for sale		220,689		0		17,590		203,099
Derivative financial assets:
Interest rate swap contracts		57,166		0		57,166		0
Forward sales commitments		112		0		112		0
TBA mortgage-backed securities		764		0		126		638
Interest rate lock commitments		4,219		0		993		3,226

Total derivative financial assets		62,261		0		58,397		3,864
Liabilities
Derivative financial liabilities:
Forward sales commitments		43		0		0		43
Interest rate lock commitments		1,879		0		0		1,879

Total derivative financial liabilities		1,922		0		0		1,922


			Fair Value at December 31, 2021 Using
Description	Balance as of December 31, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Available for sale debt securities:
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	81,850	$	0	$	81,850	$	0
State and political subdivisions		847,298		0		847,298		0
Residential mortgage-backed securities
Agency		1,113,774		0		1,113,774		0
Non-agency		74,545		0		74,545		0
Commercial mortgage-backed securities
Agency		639,925		0		639,925		0
Asset-backed securities		656,572		0		656,572		0
Single issue trust preferred securities		16,811		0		16,811		0
Other corporate securities		611,924		5,758		606,166		0

Total available for sale securities		4,042,699		5,758		4,036,941		0
Equity securities:
Financial services industry		187		187		0		0
Equity mutual funds (1)		6,406		6,406		0		0
Other equity securities		5,811		5,811		0		0

Total equity securities		12,404		12,404		0		0
Loans held for sale		504,416		0		40,307		464,109
Derivative financial assets:
Interest rate swap contracts		21,328		0		21,328		0
Forward sales commitments		430		0		430		0
TBA mortgage-backed securities		127		0		66		61
Interest rate lock commitments		10,380		0		936		9,444

Total derivative financial assets		32,265		0		22,760		9,505
Liabilities
Derivative financial liabilities:
Interest rate swap contracts		3,197		0		3,197		0
Forward sales commitments		36		0		0		36
TBA mortgage-backed securities		470		0		0		470
Interest rate lock commitments		25		0		0		25

Total derivative financial liabilities		3,728		0		3,197		531

Schedule of Additional Information about Financial Assets and Liabilities Measured at Fair Value Utilized Level 3

The following tables present additional information about financial assets and liabilities measured at fair value at June 30, 2022 and December 31, 2021 on a recurring basis and for which United has utilized Level 3 inputs to determine fair value. The amount of total gains or losses for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses related to assets still held at the reporting date are recorded in Income from mortgage banking activities in the Consolidated Statements of

Income.


	Loans held for sale
	June 30, 2022			December 31, 2021
Balance, beginning of period	$	464,109		$	654,733
Originations		1,593,515			4,984,363
Sales		(1,886,021	)		(5,313,758	)
Total gains or losses during the period recognized in earnings		31,496			138,771


	Loans held for sale
	June 30, 2022			December 31, 2021
Balance, end of period	$	203,099		$	464,109

The amount of total (losses) gains for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	439		$	10,506

	Derivative Financial Assets TBA Securities
	June 30, 2022			December 31, 2021
Balance, beginning of period	$	61		$	0
Transfers other		577			61

Balance, end of period	$	638		$	61

The amount of total gains for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	638		$	61

	Derivative Financial Assets Interest Rate Lock Commitments
	June 30, 2022			December 31, 2021

Balance, beginning of period	$	9,444		$	32,011
Transfers other		(6,218	)		(22,567	)

Balance, end of period	$	3,226		$	9,444

The amount of total gains for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	3,226		$	9,444

	Derivative Financial Liabilities Forward Sales Commitments
	June 30, 2022			December 31, 2021
Balance, beginning of period	$	36		$	0
Transfers other		7			36

Balance, end of period	$	43		$	36

The amount of total gains for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	43		$	36

	Derivative Financial Liabilities TBA Securities
	June 30, 2022			December 31, 2021
Balance, beginning of period	$	470		$	0
Transfers other		(470	)		470

Balance, end of period	$	0		$	470


	Derivative Financial Liabilities TBA Securities
	June 30, 2022			December 31, 2021
The amount of total gains for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	0		$	470


	Derivative Financial Liabilities Interest Rate Lock
	June 30, 2022		December 31, 2021
Balance, beginning of period	$	25	$	0
Transfers other		1,854		25

Balance, end of period	$	1,879	$	25

The amount of total gains for the period included in earnings (or changes in net assets) attributable to the change in unrealized gains or losses relating to assets still held at reporting date	$	1,879	$	25

Schedule of Changes in Fair Value Included in Earnings of Financial Instruments for which Fair Value Option has been Elected

The following table reflects the change in fair value included in earnings of financial instruments for which the fair value option has been elected:


Description	Three Months Ended June 30, 2022			Three Months Ended June 30, 2021
Income from mortgage banking activities	$	1,744		$	6,075

Description	Six Months Ended June 30, 2022			Six Months Ended June 30, 2021
Income from mortgage banking activities	$	(10,138	)	$	(11,776	)

Summary of Difference Between Aggregate Fair Value and Remaining Contractual Principal Outstanding for Financial Instruments for which Fair Value Option has been Elected

The following table reflects the difference between the aggregate fair value and the remaining contractual principal outstanding for financial instruments for which the fair value option has been elected:


	June 30, 2022						December 31, 2021
Description	Unpaid Principal Balance		Fair Value		Fair Value Over/(Under) Unpaid Principal Balance		Unpaid Principal Balance		Fair Value		Fair Value Over/(Under) Unpaid Principal Balance
Loans held for sale	$	220,190	$	220,689	$	499	$	493,340	$	504,416	$	11,076

Summary of Financial Assets Measured at Fair Value on Nonrecurring Basis

The following table summarizes United’s financial assets that were measured at fair value on a nonrecurring basis during the period:


			Fair value at June 30, 2022
Description	Balance as of June 30, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		YTD Gains (Losses)
Assets
Individually assessed loans	$	17,154	$	0	$	1,133	$	16,021	$	(237)
OREO		13,847		0		13,701		146		(66)
Mortgage servicing rights		41,748		0		0		41,748		0


			Fair value at December 31, 2021
Description	Balance as of December 31, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		YTD Gains (Losses)
Assets
Individually assessed loans	$	65,431	$	0	$	46,830	$	18,601	$	(601)
OREO		14,823		0		3,209		11,614		(4,020)
Mortgage servicing rights		27,355		0		0		27,355		(629)

Summary of Estimated Fair Values of Financial Instruments

The estimated fair values of United’s financial instruments are summarized below:


					Fair Value Measurements
	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2022
Cash and cash equivalents	$	1,658,486	$	1,658,486	$	0	$	1,658,486	$	0
Securities available for sale		4,812,704		4,812,704		5,540		4,807,164		0
Securities held to maturity		1,002		1,020		0		0		1,020
Equity securities		13,513		13,513		13,513		0		0
Other securities		246,399		234,079		0		0		234,079
Loans held for sale		220,689		220,689		0		17,590		203,099
Net loans		18,756,666		17,828,197		0		0		17,828,197
Derivative financial assets		62,261		62,261		0		58,397		3,864
Mortgage servicing rights		22,593		41,748		0		0		41,748
Deposits		23,026,649		22,999,148		0		22,999,148		0
Short-term borrowings		128,242		128,242		0		128,242		0
Long-term borrowings		796,961		757,969		0		757,969		0
Derivative financial liabilities		1,922		1,922		0		0		1,922
December 31, 2021
Cash and cash equivalents	$	3,758,170	$	3,758,170	$	0	$	3,758,170	$	0
Securities available for sale		4,042,699		4,042,699		5,758		4,036,941		0
Securities held to maturity		1,001		1,020		0		0		1,020
Equity securities		12,404		12,404		12,404		0		0
Other securities		239,645		227,663		0		0		227,663
Loans held for sale		504,416		504,416		0		40,307		464,109
Net loans		17,807,632		17,119,202		0		0		17,119,202
Derivative financial assets		32,265		32,265		0		22,760		9,505
Mortgage servicing rights		23,144		27,355		0		0		27,355
Deposits		23,350,263		23,334,431		0		23,334,431		0
Short-term borrowings		128,844		128,844		0		128,844		0
Long-term borrowings		817,394		773,291		0		773,291		0
Derivative financial liabilities		3,728		3,728		0		3,197		531

- Definition

The entire disclosure for a company's election to apply the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) the reasons for electing a fair value option for each eligible item or group of similar eligible items; (b) if the fair value option is elected for some but not all eligible items within a group of similar eligible items: (i) a description of those similar items and the reasons for partial election and (ii) information of how the group of similar items relates to individual balance sheet line items; (c) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected: (i) information of how each line item in the statement of financial position relates to major categories of assets and liabilities presented in accordance with other fair value disclosures and (ii) the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (d) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (e) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (f) for investments that would have been accounted for under the equity method if the entity had not chosen to apply the fair value option, the information required for such investments, if material either individually or in the aggregate; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) a description of how interest and dividends are measured and where they are reported in the income statement; (c) for loans and other receivables held as assets: (i) the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk and (ii) how the gains or losses attributable to changes in instrument-specific credit risk were determined; (d) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk: (i) the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk, (ii) qualitative information about the reasons for those changes, and (iii) how the gains and losses attributable to changes in instrument-specific credit risk were determined; and (3) certain other disclosures as required or determined to be provided.

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