Fair Value (Tables)

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Assets And Liabilities Measured At Fair Value On A Recurring Basis

The following table presents assets and liabilities measured at fair value on a recurring basis:

Fair Value Measurements at September 30, 2014 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at September 30, 2014
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	551,159	$	—	$	551,159
U.S. Government sponsored entities’ asset-backed securities	—		710,221		—		710,221
Equity securities	1,824		—		761		2,585
Mortgage loans held for sale	—		6,621		—		6,621
Mortgage IRLCs	—		47		—		47
Liabilities
Fair value swap	$	—	$	—	$	226	$	226

Fair Value Measurements at December 31, 2013 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2013
Assets
Investment securities:
Obligations of U.S. Treasury and other U.S. Government sponsored entities	$	—	$	525,136	$	—	$	525,136
U.S. Government sponsored entities’ asset-backed securities	—		648,471		—		648,471
Equity securities	1,900		—		759		2,659
Mortgage loans held for sale	—		1,666		—		1,666
Mortgage IRLCs	—		61		—		61
Liabilities
Fair value swap	$	—	$	—	$	135	$	135

Reconciliation Of Level 3 Input For Financial Instruments Measured On Recurring Basis

The table below is a reconciliation of the beginning and ending balances of the Level 3 inputs for the three and nine months ended September 30, 2014 and 2013, for financial instruments measured on a recurring basis and classified as Level 3:

Level 3 Fair Value Measurements

Three months ended September 30, 2014 and 2013

(In thousands)	Equity Securities			Fair value swap
Balance, at July 1, 2014	$	747		$	(135	)
Total gains/(losses)
Included in earnings – realized	—			—
Included in earnings – unrealized	—			—
Included in other comprehensive income (loss)	14			—
Purchases, sales, issuances and settlements, other	—			—
Re-evaluation of fair value swap, recorded in other expense	—			(91		)
Balance at September 30, 2014	$	761		$	(226	)
Balance, at July 1, 2013	$	795		$	(135	)
Total gains/(losses)
Included in earnings – realized	(17		)	—
Included in earnings – unrealized	—			—
Included in other comprehensive income (loss)	(25		)	—
Purchases, sales, issuances and settlements, other	—			—
Re-evaluation of fair value swap	—			—
Balance at September 30, 2013	$	753		$	(135	)

Level 3 Fair Value Measurements

Nine months ended September 30, 2014 and 2013

(In thousands)	Equity Securities			Fair value swap
Balance, at January 1, 2014	$	759		$	(135	)
Total gains/(losses)
Included in earnings – realized	—			—
Included in earnings – unrealized	—			—
Included in other comprehensive income (loss)	2			—
Purchases, sales, issuances and settlements, other	—			—
Re-evaluation of fair value swap, recorded in other expense	—			(91		)
Balance at September 30, 2014	$	761		$	(226	)
Balance, at January 1, 2013	$	780		$	(135	)
Total gains/(losses)
Included in earnings – realized	(17		)	—
Included in earnings – unrealized	—			—
Included in other comprehensive income (loss)	(10		)	—
Purchases, sales, issuances and settlements, other	—			—
Re-evaluation of fair value swap	—			—
Balance at September 30, 2013	$	753		$	(135	)

Assets And Liabilities Measured At Fair Value On A Nonrecurring Basis

The following tables present assets and liabilities measured at fair value on a nonrecurring basis. Collateral dependent impaired loans are carried at fair value if they have been charged down to fair value or if a specific valuation allowance has been established. A new cost basis is established at the time a property is initially recorded in OREO. OREO properties are carried at fair value if a devaluation has been taken to the property's value subsequent to the initial measurement.

Fair Value Measurements at September 30, 2014 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at September 30, 2014
Commercial loans held for sale	$	—	$	—	$	13,976	$	13,976
Impaired loans recorded at fair value:
Commercial real estate	$	—	$	—	$	10,487	$	10,487
Construction real estate:
SEPH commercial land and development	—		—		2,097		2,097
Remaining commercial	—		—		3,700		3,700
Residential real estate	—		—		1,293		1,293
Total impaired loans recorded at fair value	$	—	$	—	$	17,577	$	17,577
Mortgage servicing rights	$	—	$	2,980	$	—	$	2,980
OREO:
Commercial real estate	—		—		1,322		1,322
Construction real estate	—		—		8,017		8,017
Residential real estate	—		—		2,225		2,225
Total OREO	$	—	$	—	$	11,564	$	11,564

Fair Value Measurements at December 31, 2013 using:
(In thousands)	Level 1		Level 2		Level 3		Balance at December 31, 2013
Impaired loans recorded at fair value:
Commercial real estate	$	—	$	—	$	21,100	$	21,100
Construction real estate:
SEPH commercial land and development	—		—		4,777		4,777
Remaining commercial	—		—		3,788		3,788
Residential real estate	—		—		4,154		4,154
Total impaired loans recorded at fair value	$	—	$	—	$	33,819	$	33,819
Mortgage servicing rights	$	—	$	2,259	$	—	$	2,259
OREO:
Commercial real estate	—		—		4,119		4,119
Construction real estate	—		—		11,041		11,041
Residential real estate	—		—		3,366		3,366
Total OREO	$	—	$	—	$	18,526	$	18,526

Qualitative Information about Level 3 Fair Value Measurements Measured on Non-Recurring Basis

The following tables present qualitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at September 30, 2014 and December 31, 2013:

September 30, 2014
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	10,487	Sales comparison approach	Adj to comparables	0.0% - 96.0% (39.9%)
			Income approach	Capitalization rate	9.5% - 10.3% (9.5%)
			Cost approach	Accumulated depreciation	50.0% - 50.0% (50.0%)
Construction real estate:
SEPH commercial land and development	$	2,097	Sales comparison approach	Adj to comparables	5.0% - 35.0% (17.5%)
			Bulk sale approach	Discount rate	10.8% - 10.8% (10.8%)
Remaining commercial	$	3,700	Sales comparison approach	Adj to comparables	0.2% - 76.0% (42.4%)
			Bulk sale approach	Discount rate	10.0% - 22.0% (15.8%)
Residential real estate	$	1,293	Sales comparison approach	Adj to comparables	0.0% - 120.6% (14.2%)
			Income approach	Capitalization rate	10.0% - 10.0% (10.0%)
Other real estate owned:
Commercial real estate	$	1,322	Sales comparison approach	Adj to comparables	0.0% - 87.0% (31.4%)
			Income approach	Capitalization rate	8.4% - 10.0% (9.6%)
			Cost approach	Accumulated depreciation	60.0% - 95.0% (77.5%)
Construction real estate	$	8,017	Sales comparison approach	Adj to comparables	0.0% - 119.0% (27.4%)
			Bulk sale approach	Discount rate	15.0% - 15.0% (15.0%)
Residential real estate	$	2,225	Sales comparison approach	Adj to comparables	0.0% - 38.3% (9.9%)
			Income approach	Capitalization rate	6.8% - 7.8% (7.6%)
Loans held for sale	$	13,976	Broker pricing	N/A	N/A

Balance at December 31, 2013
(In thousands)	Fair Value		Valuation Technique	Unobservable Input(s)	Range (Weighted Average)
Impaired loans:
Commercial real estate	$	21,100	Sales comparison approach	Adj to comparables	0.0% - 109.0% (22.8%)
			Income approach	Capitalization rate	8.0% - 12.5% (9.1%)
			Cost approach	Accumulated depreciation	11.7% - 65.0% (37.1%)
Construction real estate:
SEPH commercial land and development	$	4,777	Sales comparison approach	Adj to comparables	0.0% - 96.0% (13.9%)
			Bulk sale approach	Discount rate	11.0% - 20.0% (14.9%)
Remaining commercial	$	3,788	Sales comparison approach	Adj to comparables	0.0% - 40.0% (22.4%)
			Bulk sale approach	Discount rate	11.0% - 20.0% (18.0%)
Residential real estate	$	4,154	Sales comparison approach	Adj to comparables	0.0% - 121.8% (14.9%)
			Income approach	Capitalization rate	7.8% - 10.0% (8.4%)
Other real estate owned:
Commercial real estate	$	4,119	Sales comparison approach	Adj to comparables	0.0% - 140.0% (17.7%)
			Income approach	Capitalization rate	8.0% - 11.5% (9.6%)
			Cost approach	Accumulated depreciation	60.0% - 95.0% (80.0%)
Construction real estate	$	11,041	Sales comparison approach	Adj to comparables	0.0% - 484.0% (36.2%)
			Bulk sale approach	Discount rate	13.0% - 14.0% (13.6%)
Residential real estate	$	3,366	Sales comparison approach	Adj to comparables	0.0% - 273.0% (19.2%)
			Income approach	Capitalization rate	5.4% - 7.8% (7.4%)

Fair Value, by Balance Sheet Grouping

The fair value of financial instruments at September 30, 2014 and December 31, 2013, was as follows:

	September 30, 2014
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	303,286	$	303,286	$	—	$	—	$	303,286
Investment securities	1,414,314		1,824		1,414,366		761		1,416,951
Accrued interest receivable - securities	4,267		—		4,267		—		4,267
Accrued interest receivable - loans	13,943		—		—		13,943		13,943
Loans held for sale	28,606		—		6,621		25,542		32,163
Mortgage IRLCs	47		—		47		—		47
Impaired loans carried at fair value	17,577		—		—		17,577		17,577
Other loans, net	4,695,135		—		—		4,704,517		4,704,517
Loans receivable, net	$	4,712,759	$	—	$	47	$	4,722,094	$	4,722,141
Financial liabilities:
Noninterest bearing checking accounts	$	1,175,991	$	1,175,991	$	—	$	—	$	1,175,991
Interest bearing transactions accounts	1,234,700		1,234,700		—		—		1,234,700
Savings accounts	1,278,222		1,278,222		—		—		1,278,222
Time deposits	1,434,770		—		1,437,708		—		1,437,708
Other	5,321		5,321		—		—		5,321
Total deposits	$	5,129,004	$	3,694,234	$	1,437,708	$	—	$	5,131,942
Short-term borrowings	$	268,718	$	—	$	268,718	$	—	$	268,718
Long-term debt	788,685		—		832,438		—		832,438
Subordinated debentures/notes	80,250		—		86,107		—		86,107
Accrued interest payable – deposits	1,293		14		1,279		—		1,293
Accrued interest payable – debt/borrowings	1,511		10		1,501		—		1,511
Derivative financial instruments:
Fair value swap	$	226	$	—	$	—	$	226	$	226

	December 31, 2013
			Fair Value Measurements
(In thousands)	Carrying value		Level 1		Level 2		Level 3		Total fair value
Financial assets:
Cash and money market instruments	$	147,030	$	147,030	$	—	$	—	$	147,030
Investment securities	1,358,327		1,900		1,361,009		759		1,363,668
Accrued interest receivable - securities	4,840		—		4,840		—		4,840
Accrued interest receivable - loans	13,495		—		—		13,495		13,495
Loans held for sale	1,666		—		1,666		—		1,666
Mortgage IRLCs	61		—		61		—		61
Impaired loans carried at fair value	33,819		—		—		33,819		33,819
Other loans, net	4,525,491		—		—		4,531,680		4,531,680
Loans receivable, net	$	4,559,371	$	—	$	61	$	4,565,499	$	4,565,560
Financial liabilities:
Noninterest bearing checking accounts	$	1,193,553	$	1,193,553	$	—	—		$	1,193,553
Interest bearing transactions accounts	1,145,525		1,145,525		—		—		1,145,525
Savings accounts	1,124,994		1,124,994		—		—		1,124,994
Time deposits	1,324,659		—		1,331,129		—		1,331,129
Other	1,263		1,263		—		—		1,263
Total deposits	$	4,789,994	$	3,465,335	$	1,331,129	$	—	$	4,796,464
Short-term borrowings	$	242,029	$	—	$	242,029	$	—	$	242,029
Long-term debt	810,541		—		860,963		—		860,963
Subordinated debentures/notes	80,250		—		83,140		—		83,140
Accrued interest payable – deposits	1,366		16		1,350		—		1,366
Accrued interest payable – debt/borrowings	1,535		4		1,531		—		1,535
Derivative financial instruments:
Fair value swap	$	135	$	—	$	—	$	135	$	135