Fair Value (Tables)

12 Months Ended

Dec. 31, 2016

Summary of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:



	Fair Value		Readily Available Market Prices (Level 1)		Observable Market Data (Level 2)		Company Determined Fair Value (Level 3)
December 31, 2016
Financial assets:
Loans held for sale	$	14,836	$	—	$	14,836	$	—
AFS securities:
Obligations of states and political subdivisions	9,001		—		9,001		—
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises	480,622		—		480,622		—
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises	283,890		—		283,890		—
Subordinated corporate bonds	5,613		—		5,613		—
Equity securities	741		—		741		—
Customer loan swaps	1,945		—		1,945		—
Fixed-rate interest rate lock commitments	202		—		202		—
Forward delivery commitments	587		—		587		—
Financial liabilities:
Junior subordinated debt interest rate swaps	8,372		—		8,372		—
FHLBB advance interest rate swaps	389		—		389		—
Customer loan swaps	1,945		—		1,945		—
Fixed-rate interest rate lock commitments	15		—		15		—
Forward delivery commitments	309		—		309		—
December 31, 2015
Financial assets:
Loans held for sale	$	10,958	$	—	$	10,958	$	—
AFS securities:
Obligations of U.S. government-sponsored enterprises	5,040		—		5,040		—
Obligations of states and political subdivisions	17,694		—		17,694		—
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises	419,046		—		419,046		—
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises	306,857		—		306,857		—
Subordinated corporate bonds	996		—		996		—
Equity securities	705		—		705		—
Customer loan swaps	3,166		—		3,166		—
Fixed-rate interest rate lock commitments	229		—		229		—
Financial liabilities:
Junior subordinated debt interest rate swaps	9,229		—		9,229		—
FHLBB advance interest rate swaps	576		—		576		—
Customer loan swaps	3,166		—		3,166		—
Fixed-rate interest rate lock commitments	90		—		90		—

Summary of Assets Measured at Fair Value on Non Recurring Basis

The table below highlights financial and non-financial assets measured and recorded at fair value on a non-recurring basis as of December 31, 2016 and 2015:



	Fair Value		Readily Available Market Prices (Level 1)		Observable Market Data (Level 2)		Company Determined Fair Value (Level 3)
December 31, 2016
Financial assets:
Collateral-dependent impaired loans	$	500	$	—	$	—	$	500
MSRs⁽¹⁾	1,090		—		1,090		—
Non-financial assets:
OREO	922		—		—		922
December 31, 2015
Financial assets:
Collateral-dependent impaired loans	$	1,971	$	—	$	—	$	1,971
MSRs⁽¹⁾	440		—		440		—
Non-financial assets:
OREO	1,304		—		—		1,304


(1)	Represents MSRs deemed to be impaired and a valuation allowance was established to carry at fair value at December 31, 2016 and 2015.

Valuation Methodology and Unobservable Inputs for Level Three Assets Measured at Fair Value on Non Recurring Basis

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, 2016 and 2015:



	Fair Value		Valuation Methodology	Unobservable input	Discount Range (Weighted-Average)
December 31, 2016
Collateral-dependent impaired loans:
Partially charged-off	$	166	Market approach appraisal of collateral	Management adjustment of appraisal	0%	(0%)
				Estimated selling costs	0 - 10%	(5%)
Specifically reserved	334		Market approach appraisal of collateral	Management adjustment of appraisal	0 - 50%	(13%)
				Estimated selling costs	10%	(10%)
OREO	922		Market approach appraisal of collateral	Management adjustment of appraisal	0 - 73%	(7%)
				Estimated selling costs	10%	(10%)
December 31, 2015
Collateral-dependent impaired loans:
Partially charged-off	$	399	Market approach appraisal of collateral	Management adjustment of appraisal	0%	(0%)
				Estimated selling costs	0 - 10%	(7%)
Specifically reserved	1,572		Market approach appraisal of collateral	Management adjustment of appraisal	0 - 57%	(45%)
				Estimated selling costs	10%	(10%)
OREO	1,304		Market approach appraisal of collateral	Management adjustment of appraisal	0 - 43%	(18%)
				Estimated selling costs	10%	(10%)

Carrying Amounts and Estimated Fair Value for Financial Instrument Assets and Liabilities

The following table presents the carrying amounts and estimated fair value for financial instrument assets and liabilities at December 31, 2016:



	Carrying Amount		Fair Value		Readily Available Market Prices (Level 1)		Observable Market Prices (Level 2)		Company Determined Market Prices (Level 3)
Financial assets:
Cash and due from banks	$	87,707	$	87,707	$	87,707	$	—	$	—
AFS securities	779,867		779,867		—		779,867		—
HTM securities	94,609		94,596		—		94,596		—
Loans held for sale	14,836		14,836		—		14,836		—
Residential real estate loans⁽¹⁾	798,334		800,122		—		—		800,122
Commercial real estate loans⁽¹⁾	1,038,626		1,006,249		—		—		1,006,249
Commercial loans⁽¹⁾⁽²⁾	389,624		391,493		—		—		391,493
Home equity loans⁽¹⁾	327,713		327,292		—		—		327,292
Consumer loans⁽¹⁾	17,151		16,845		—		—		16,845
MSRs⁽³⁾	1,210		1,701		—		1,701		—
Interest receivable	8,654		8,654		—		8,654		—
Customer loan swaps	1,945		1,945		—		1,945		—
Fixed-rate interest rate lock commitments	202		202		—		202		—
Forward delivery commitments	587		587		—		587		—
Financial liabilities:
Deposits	$	2,828,529	$	2,826,484	$	—	$	2,826,484	$	—
Short-term borrowings	530,129		530,435		—		530,435		—
Long-term borrowings	10,791		10,836		—		10,836		—
Subordinated debentures	58,755		41,660		—		41,660		—
Interest payable	534		534		—		534		—
Junior subordinated debt interest rate swaps	8,372		8,372		—		8,372		—
Forward-starting interest rate swaps	389		389		—		389		—
Customer loan swaps	1,945		1,945		—		1,945		—
Fixed-rate interest rate lock commitments	15		15		—		15		—
Forward delivery commitments	309		309		—		309		—


(1)	The presented carrying amount is net of the allocated ALL.


(2)	Includes the HPFC loan portfolio.


(3)	Reported fair value represents all MSRs currently being serviced by the Company at December 31, 2016.

The following table presents the carrying amounts and estimated fair value for financial instrument assets and liabilities at December 31, 2015:



	Carrying Amount		Fair Value		Readily Available Market Prices (Level 1)		Observable Market Prices (Level 2)		Company Determined Market Prices (Level 3)
Financial assets:
Cash and due from banks	$	79,488	$	79,488	$	79,488	$	—	$	—
AFS securities	750,338		750,338		—		750,338		—
HTM securities	84,144		85,647		—		85,647		—
Loans held for sale	10,958		10,958		—		10,958		—
Residential real estate loans⁽¹⁾	808,180		820,774		—		—		820,774
Commercial real estate loans⁽¹⁾	922,257		911,316		—		—		911,316
Commercial loans⁽¹⁾⁽²⁾	371,684		371,854		—		—		371,854
Home equity loans⁽¹⁾	349,215		348,963		—		—		348,963
Consumer loans⁽¹⁾	17,704		18,163		—		—		18,163
MSRs⁽³⁾	2,161		2,947		—		2,947		—
Interest receivable	7,985		7,985		—		7,985		—
Customer loan swaps	3,166		3,166		—		3,166		—
Fixed-rate interest rate lock commitments	229		229		—		229		—
Financial liabilities:
Deposits	$	2,726,379	$	2,726,300	$	—	$	2,726,300	$	—
Short-term borrowings	477,852		479,403		—		479,403		—
Long-term borrowings	35,911		36,307		—		36,307		—
Subordinated debentures	58,599		42,950		—		42,950		—
Interest payable	641		641		—		641		—
Junior subordinated debt interest rate swaps	9,229		9,229		—		9,229		—
Forward-starting interest rate swaps	576		576		—		576		—
Customer loan swaps	3,166		3,166		—		3,166		—
Fixed-rate interest rate lock commitments	90		90		—		90		—


(1)	The presented carrying amount is net of the allocated ALL.


(2)	Includes the HPFC loan portfolio.


(3)	Reported fair value represents all MSRs currently being serviced by the Company at December 31, 2015.