FAIR VALUE MEASUREMENT (Tables)

6 Months Ended

Jun. 30, 2012

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 June 30, 2012 and December 31, 2011, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

	Readily Available Market Prices (Level 1)		Observable Market Data (Level 2)		Company Determined Fair Value (Level 3)		Total
At June 30, 2012
Financial Assets:
Available for sale debt securities:
Obligations of states and political subdivisions	$	—	$	37,234	$	—	$	37,234
Mortgage-backed securities issued or guaranteed by U.S. government sponsored enterprises		—		629,934		—		629,934
Private issue collateralized mortgage obligations		—		10,094		—		10,094
Trading account assets		2,184		—		—		2,184
Financial Liabilities:
Interest rate swap agreements		—		12,820		—		12,820
At December 31, 2011
Financial Assets:
Available for sale debt securities:
Obligations of U.S. government sponsored enterprises	$	—	$	30,107	$	—	$	30,107
Obligations of states and political subdivisions		—		39,758		—		39,758
Mortgage-backed securities issued or guaranteed by U.S. government sponsored enterprises		—		505,384		—		505,384
Private issue collateralized mortgage obligations		—		10,641		—		10,641
Equity securities		—		4,146		—		4,146
Trading account assets		2,244		—		—		2,244
Financial Liabilities:
Interest rate swap agreements		—		11,387		—		11,387

Summary of Assets Measured at Fair Value on Non Recurring Basis

Assets measured at fair value on a non-recurring basis as of June 30, 2012 and December 31, 2011 are included below:

	Readily Available Market Prices (Level 1)		Observable Market Data (Level 2)		Company Determined Fair Value (Level 3)		Total
At June 30, 2012
Assets:
Collateral-dependent impaired loans	$	—	$	—	$	9,525	$	9,525
Other real estate owned		—		—		1,697		1,697
Mortgage servicing rights		—		976		—		976
At December 31, 2011
Assets:
Impaired loans	$	—	$	—	$	18,183	$	18,183
Goodwill		—		—		276		276
Other real estate owned		—		—		1,682		1,682
Mortgage servicing rights		—		1,138		—		1,138

Valuation Methodology and Unobservable Inputs for Level 3 Assets Measured at Fair Value on a 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 June 30, 2012:

		Fair Value	Valuation Methodology	Unobservable input	Discount Range
Collateral-dependent impaired loans:(1)
Partially charged-off	$	2,914	Market approach appraisal of collateral	Management adjustment of appraisal	10 – 30%
Specifically reserved		6,611	Market approach appraisal of collateral	Management adjustment of appraisal	—	(2)
Other real estate owned	$	1,697	Market approach appraisal of collateral	Management adjustment of appraisal	10 – 30%
				Estimated selling cost	6 – 10%

(1) Does not include impaired loans that are measured by the present value of expected future cash flows discounted at the loan’s effective interest rate.

(2) The specific reserve for collateral-dependent impaired loans is determined by any deficit of 75% of collateral value over the recorded investment.

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 June 30, 2012:

					Fair Value Measurement at June 30, 2012
	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	$	40,478	$	40,478	$	40,478	$	—	$	—
Securities available for sale		677,262		677,262		—		677,262		—
FHLB and Federal Reserve Bank stock		21,034		21,034		21,034		—		—
Trading account assets		2,184		2,184		2,184		—		—
Loans receivable, net of allowance		1,513,202		1,534,591		—		—		1,534,591
Mortgage servicing rights		688		976		—		976		—
Interest receivable		6,530		6,530		—		6,530		—
Financial liabilities:
Deposits		1,601,861		1,610,149		1,070,414		539,735		—
FHLB advances		251,613		258,173		—		258,173		—
Commercial repurchase agreements		66,210		69,850		—		69,850		—
Other borrowed funds		166,222		166,222		166,222		—		—
Junior subordinated debentures		43,768		43,768		—		43,768		—
Interest payable		928		928		928		—		—
Interest rate swap agreements		12,820		12,820		—		12,820		—

The following table presents the carrying amounts and estimated fair value for financial instrument assets and liabilities at December 31, 2011:

	December 31, 2011
	Carrying  Amount		Fair Value
Financial assets:
Cash and due from banks	$	39,325	$	39,325
Securities available for sale		590,036		590,036
FHLB and Federal Reserve Bank stock		21,962		21,962
Trading account assets		2,244		2,244
Loans held for sale		6,061		6,268
Loans receivable, net of allowance		1,491,017		1,510,277
Mortgage servicing rights		768		1,138
Interest receivable		6,431		6,431
Financial liabilities:
Deposits		1,591,366		1,600,222
FHLB advances		136,860		143,642
Commercial repurchase agreements		71,243		75,342
Other borrowed funds		204,413		204,413
Junior subordinated debentures		43,717		43,717
Interest payable		1,093		1,093
Interest rate swap agreements		11,387		11,387