EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2012

General Discussion of Pension and Other Postretirement Benefits [Abstract]

Employee Benefit Plans

EMPLOYEE BENEFIT PLANS

BancShares sponsors benefit plans for its qualifying employees including a noncontributory defined benefit pension plan, a 401(k) savings plan and an enhanced 401(k) savings plan. These plans are qualified under the Internal Revenue Code. BancShares also maintains agreements with certain executives that provide supplemental benefits that are paid upon death or separation from service at an agreed-upon age.

Defined Benefit Pension Plan

Employees who were hired prior to April 1, 2007, and who qualify under length of service and other requirements may participate in a noncontributory defined benefit pension plan (Plan). Under the Plan, benefits are based on years of service and average earnings. The policy is to fund amounts approximating the maximum amount that is deductible for federal income tax purposes. BancShares made no contributions to the plan in 2012 or 2011, and does not anticipate any contribution during 2013.

Obligations and Funded Status

The following table provides the change in benefit obligation and plan assets and the funded status of the plan at December 31, 2012, and 2011.

	2012			2011
Change in Benefit Obligation
Benefit obligation at January 1	$	493,648		$	431,090
Service cost	14,241			13,265
Interest cost	23,711			23,810
Actuarial loss	64,540			38,946
Benefits paid	(15,202		)	(13,463		)
Benefit obligation at December 31	580,938			493,648
Change in Plan Assets
Fair value of plan assets at January 1	429,505			433,467
Actual return on plan assets	48,702			9,501
Employer contributions	—			—
Benefits paid	(15,202		)	(13,463		)
Fair value of plan assets at December 31	463,005			429,505
Funded status at December 31	$	(117,933	)	$	(64,143	)

The amounts recognized in the consolidated balance sheets as of December 31, 2012, and 2011 consist of:

	2012			2011
Other assets	$	—		$	—
Other liabilities	(117,933		)	(64,144		)
Net liability recognized	$	(117,933	)	$	(64,144	)

Amounts recognized in accumulated other comprehensive income at December 31, 2012, and 2011 consist of:

	2012		2011
Net loss	$	157,147	$	123,858
Less prior service cost	1,187		1,397
Accumulated other comprehensive loss, excluding income taxes	$	158,334	$	125,255

Expected amortization amounts in 2013
Actuarial loss	$	17,006
Prior service cost	210
Total	$	17,216

The accumulated benefit obligation for the plan at December 31, 2012, and 2011 equaled $485,641 and $412,668, respectively. The Plan uses a measurement date of December 31.

The following table shows the components of periodic benefit cost related to the pension plan and changes in plan assets and benefit obligations recognized in other comprehensive income for the years ended December 31, 2012, 2011, and 2010.

	2012			2011			2010
Service cost	$	14,241		$	13,265		$	12,191
Interest cost	23,711			23,810			22,930
Expected return on assets	(28,478		)	(29,184		)	(29,274		)
Amortization of prior service cost	210			210			210
Amortization of net actuarial loss	11,026			6,861			3,800
Total net periodic benefit cost	20,710			14,962			9,857
Current year actuarial gain (loss)	44,315			58,630			6,815
Amortization of actuarial gain (loss)	(11,026		)	(6,861		)	(3,800		)
Amortization of prior service cost	(210		)	(210		)	(210		)
Total recognized in other comprehensive income	33,079			51,559			2,805
Total recognized in net periodic benefit cost and other comprehensive income	$	53,789		$	66,521		$	12,662

The assumptions used to determine the benefit obligations as of December 31, 2012, and 2011 are as follows:

	2012		2011
Discount rate	4.00	%	4.75	%
Rate of compensation increase	4.00		4.00

The assumptions used to determine the net periodic benefit cost for the years ended December 31, 2012, 2011, and 2010 are as follows:

	2012		2011		2010
Discount rate	4.75	%	5.50	%	6.00	%
Rate of compensation increase	4.00		4.50		4.50
Expected long-term return on plan assets	7.50		7.75		8.00

The estimated discount rate, which represents the interest rate that could be obtained for a suitable investment used to fund the benefit obligations, is based on a yield curve developed from high-quality corporate bonds across a full maturity spectrum. The projected cash flows of the pension plan are discounted based on this yield curve, and a single discount rate is calculated to achieve the same present value.

The estimated long-term rate of return on plan assets is used to calculate the value of plan assets over time. The methodology utilized to establish the estimated long-term rate of return on plan assets considers the actual return on plan assets for various time horizons since 1996 as a predictor of probable future returns. Historical returns are modified as appropriate by estimates of future market conditions that may positively or negatively affect estimated future returns. The return on plan

assets for the 15-year, 10-year and 5-year periods ended December 31, 2012, equaled 6.98 percent, 8.77 percent and 5.81 percent, respectively. Based on expectations of modest returns over the next several years, the assumed rate of return for 2012 was 7.50 percent, compared to 7.75 percent in 2011.

Plan Assets

BancShares' primary total return objective is to achieve returns that, over the long term, will fund retirement liabilities and provide for the desired plan benefits in a manner that satisfies the fiduciary requirements of the Employee Retirement Income Security Act. The plan assets have a long-term time horizon that runs concurrent with the average life expectancy of the participants. As such, the Plan can assume a time horizon that extends well beyond a full market cycle and can assume a reasonable level of risk. It is expected, however, that both professional investment management and sufficient portfolio diversification will smooth volatility and help to generate a reasonable consistency of return. The investments are broadly diversified among economic sector, industry, quality and size in order to reduce risk and to produce incremental return. Within approved guidelines and restrictions, the investment manager has discretion over the timing and selection of individual investments.

The fair values of pension plan assets at December 31, 2012, and 2011 by asset category are as follows:

Asset Category	Market Value		Quoted prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Nonobservable Inputs (Level 3)		Target Allocation		Actual % of Plan Assets
December 31, 2012
Cash and equivalents	$	3,088	$	3,088	$	—	$	—	0 - 1%		1	%
Equity securities(a)									55 - 65 %		63	%
Consumer discretionary	27,314		27,314		—		—
Consumer staples	16,294		16,294		—		—
Energy	28,046		28,046		—		—
Information technology	38,570		38,570		—		—
Telecommunication	4,678		4,678		—		—
Financials	35,921		35,921		—		—
Utilities	6,043		6,043		—		—
Materials	9,950		9,950		—		—
Health care	30,661		30,661		—		—
Industrials	23,466		23,466		—		—
Rights to purchase securities	4,168		4,168		—		—
Mutual funds	68,415		68,415		—		—
Debt securities(b)									34 - 44 %		36	%
Bond funds	166,391		—		166,391		—
Total pension assets	$	463,005	$	296,614	$	166,391	$	—	100	%	100	%
December 31, 2011
Cash and equivalents	$	5,002	$	5,002	$	—	$	—	0 - 1%		1	%
Equity securities(a)									55 - 65 %		63	%
Consumer discretionary	24,003		24,003		—		—
Consumer staples	15,257		15,257		—		—
Energy	27,857		27,857		—		—
Information technology	35,206		35,206		—		—
Telecommunication	4,888		4,888		—		—
Financials	31,185		31,185		—		—
Utilities	6,263		6,263		—		—
Materials	10,548		10,548		—		—
Health care	30,195		30,195		—		—
Industrials	21,451		21,451		—		—
Rights to purchase securities	3,724		3,724		—		—
Mutual funds	60,493		60,493		—		—
Debt securities(b)									34 - 44 %		36	%
Bond funds	153,433		—		153,432		—
Total pension assets	$	429,505	$	276,072	$	153,432	$	—	100	%	100	%

(a) This category includes investments in equity securities of large, small and medium sized companies from various industries.

(b) This category represents investment grade bonds from diverse industries.

Cash Flows

BancShares anticipates making no contributions to the pension plan during 2013. Following are estimated payments to pension plan participants in the indicated periods:

	Projected Benefit Payments
2013	$	16,781
2014	18,062
2015	19,679
2016	21,445
2017	23,238
2018-2022	141,253

401(k) Savings Plans

Certain employees enrolled in the defined benefit plan are also eligible to participate in a 401(k) savings plan after 31 days of service through deferral of portions of their salary. For employees who participate in the 401(k) savings plan who also continue to accrue additional years of service under the defined benefit plan, based on the employee’s contribution, BancShares matches up to 75 percent of the employee contribution.

At the end of 2007, current employees were given the option to continue to accrue additional years of service under the the defined benefit plan or to elect to join an enhanced 401(k) savings plan. Under the enhanced 401(k) savings plan, based on the employee’s contribution, BancShares matches up to 100 percent of the employee contribution. In addition to the employer match of the employee contributions, the enhanced 401(k) savings plan provides a guaranteed contribution to plan participants if they remain employed at the end of each calendar year. Employees who elected to enroll in the enhanced 401(k) savings plan discontinued the accrual of additional years of service under the defined benefit plan and became enrolled in the enhanced 401(k) savings plan effective January 1, 2008. Eligible employees hired after January 1, 2008, have the option to elect to participate in the enhanced 401(k) savings plan.

BancShares made participating contributions to both 401(k) plans totaling $14,131, $13,633 and $12,307 during 2012, 2011 and 2010, respectively.

Additional Benefits for Executives and Directors and Officers of Acquired Entities

FCB has entered into contractual agreements with certain executives that provide payments for a period of ten years following separation from service at an agreed-upon age. These agreements also provide a death benefit in the event a participant dies before the term of the agreement ends. FCB has also assumed liability for contractual obligations to directors and officers of previously-acquired entities.

The following table provides the accrued liability as of December 31, 2012, and 2011 and the changes in the accrued liability during the years then ended:

	2012			2011
Present value of accrued liability as of January 1	$	25,586		$	23,027
Benefit expense	462			1,799
Benefits paid	(3,241		)	(1,877		)
Benefits forfeited	554			—
Interest cost	2,490			2,637
Present value of accrued liability as of December 31	$	25,851		$	25,586
Discount rate at December 31	4.00		%	4.75		%