Fair Value (Tables)

9 Months Ended

Sep. 30, 2018

Schedule of Fair Value of Assets Measured on Recurring and Nonrecurring Basis

Under ASC 820, fair value measurements for items measured at fair value on a recurring and nonrecurring basis at September 30, 2018 and December 31, 2017 included:



(In thousands)	Fair Value Measurements		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2018
Available for sale debt securities ⁽¹⁾	$	923,206	$	99	$	923,107	$	—
Loans held for sale ⁽²⁾	16,172		—		16,172		—
Loans ⁽³⁾	7,268		—		2,255		5,013
Other real estate owned ⁽⁴⁾	4,715		—		64		4,651
Equity securities ⁽⁵⁾	6,145		6,145		—		—

December 31, 2017
Available for sale debt securities ⁽¹⁾⁽⁵⁾	$	949,460	$	100	$	949,360	$	—
Loans held for sale ⁽²⁾	24,306		—		24,306		—
Loans ⁽³⁾	4,192		—		3,454		738
Other real estate owned ⁽⁴⁾	7,640		—		60		7,580
Equity securities ⁽⁵⁾	6,344		6,344		—		—

(1) See Note D for further detail of fair value of individual investment categories.

(2) Recurring fair value basis determined using observable market data.

(3) See Note F. Nonrecurring fair value adjustments to loans identified as impaired reflect full or partial write-downs that are based on the loan’s observable market price or current appraised value of the collateral in accordance with ASC 310.

(4) Fair value is measured on a nonrecurring basis in accordance with ASC 360.

(5) Prior to adoption of ASU 2016-1 on January 1, 2018, an investment in shares of a mutual fund that invests primarily in CRA-qualified debt securities was classified as an available for sale security. Beginning in 2018, this security is reported at fair value in Other Assets. Fair value is determined based on market quotations.

Schedule of Aggregate Fair Value and Contractual Balance of Loans for Sale

The aggregate fair value and contractual balance of loans held for sale as of September 30, 2018 and December 31, 2017 is as follows:



(In thousands)	September 30, 2018		December 31, 2017
Aggregate fair value	$	16,172	$	24,306
Contractual balance	15,722		23,627
Excess	450		679

Schedule of Carrying Amount and Fair Value of Other Significant Financial Instruments Not Measured on a Recurring Basis

The carrying amount and fair value of the Company’s other financial instruments that are not measured at fair value on a recurring basis in the balance sheet as of September 30, 2018 and December 31, 2017 is as follows:



(In thousands)	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2018
Financial Assets
Debt securities held to maturity ⁽¹⁾	$	367,387	$	—	$	353,919	$	—
Time deposits with other banks	9,813		—		—		9,715
Loans, net	4,018,190		—		—		3,982,029
Financial Liabilities
Deposit liabilities	4,643,510		—		—		4,638,270
Federal Home Loan Bank (FHLB) borrowings	261,000		—		—		261,036
Subordinated debt	70,734		—		61,716		—

December 31, 2017
Financial Assets
Debt securities held to maturity ⁽¹⁾	$	416,863	$	—	$	414,470	$	—
Time deposits with other banks	12,553		—		—		12,493
Loans, net	3,786,063		—		—		3,760,754
Financial Liabilities
Deposit liabilities	4,592,720		—		—		4,588,515
Federal Home Loan Bank (FHLB) borrowings	211,000		—		—		211,000
Subordinated debt	70,521		—		61,530		—

(1) See Note D for further detail of individual investment categories.

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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