XML 42 R32.htm IDEA: XBRL DOCUMENT v3.19.1
Fair Value Measurements (Tables)
 3 Months Ended
Mar. 31, 2019
Fair Value Disclosures [Abstract]  
Fair Value Assets And Liabilities Measured On A Recurring Basis [Table Text Block] The fair value of financial assets and liabilities measured on a recurring basis was as follows as of March 31, 2019 (in thousands):
 
 
Total
 
Quoted Prices in Active Markets for Identical Instruments (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable Inputs
(Level 3)
Assets:
 
 
 
 
 
 
 
 
Trading securities:
 
 
 
 
 
 
 
 
U.S. government agency debentures
 
$
51,576

 
$
—

 
$
51,576

 
$
—

U.S. government agency residential mortgage-backed securities
 
1,952,742

 
—

 
1,952,742

 
—

Municipal and other tax-exempt securities
 
50,637

 
—

 
50,637

 
—

Asset-backed securities
 
40,890

 
—

 
40,890

 
—

Other trading securities
 
44,481

 
—

 
44,481

 
—

Total trading securities
 
2,140,326

 
—

 
2,140,326

 
—

Available for sale securities:
 
 

 
 

 
 

 
 

U.S. Treasury
 
1,878

 
1,878

 
—

 
—

Municipal and other tax-exempt securities
 
2,447

 
—

 
2,447

 
—

Residential agency mortgage-backed securities
 
6,040,086

 
—

 
6,040,086

 
—

Residential non-agency mortgage-backed securities
 
47,958

 
—

 
47,958

 
—

Commercial agency mortgage-backed securities
 
2,932,357

 
—

 
2,932,357

 
—

Other debt securities
 
472

 
—

 
—

 
472

Total available for sale securities
 
9,025,198

 
1,878

 
9,022,848

 
472

Fair value option securities – U.S. government agency residential mortgage-backed securities
 
707,994

 
—

 
707,994

 
—

Residential mortgage loans held for sale
 
160,157

 
—

 
144,381

 
15,776

Mortgage servicing rights1
 
238,193

 
—

 
—

 
238,193

Derivative contracts, net of cash collateral2
 
359,223

 
4,720

 
354,503

 
—

Liabilities:
 
 

 
 
 
 
 
 
Derivative contracts, net of cash collateral2
 
299,698

 
—

 
299,698

 
—

1 
A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 6, Mortgage Banking Activities.
2 
See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts in asset positions that were valued based on quoted prices in active markets for identical instruments (Level 1) are primarily exchange-traded interest rate and agricultural derivative contacts, net of cash margin. Derivative contacts in liability positions that were valued using quoted prices in active markets for identical instruments are exchange-traded interest rate and energy derivative contracts, fully offset by cash margin.

The fair value of financial assets and liabilities measured on a recurring basis was as follows as of December 31, 2018 (in thousands):
 
 
Total
 
Quoted Prices in Active Markets for Identical Instruments (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable Inputs
(Level 3)
Assets:
 
 
 
 
 
 
 
 
Trading securities:
 
 
 
 
 
 
 
 
U.S. government agency debentures
 
$
63,765

 
$
—

 
$
63,765

 
$
—

U.S. government agency residential mortgage-backed securities
 
1,791,584

 
—

 
1,791,584

 
—

Municipal and other tax-exempt securities
 
34,507

 
—

 
34,507

 
—

Asset-backed securities
 
42,656

 
—

 
42,656

 
—

Other trading securities
 
24,411

 
—

 
24,411

 
—

Total trading securities
 
1,956,923

 
—

 
1,956,923

 
—

Available for sale securities:
 
 

 
 

 
 

 
 

U.S. Treasury
 
493

 
493

 
—

 
—

Municipal and other tax-exempt securities
 
2,864

 
—

 
2,864

 
—

Residential agency mortgage-backed securities
 
5,804,708

 
—

 
5,804,708

 
—

Residential non-agency mortgage-backed securities
 
59,736

 
—

 
59,736

 
—

Commercial agency mortgage-backed securities
 
2,953,889

 
—

 
2,953,889

 
—

Other debt securities
 
35,430

 
—

 
34,958

 
472

Total available for sale securities
 
8,857,120

 
493

 
8,856,155

 
472

Fair value option securities – U.S. government agency residential mortgage-backed securities
 
283,235

 
—

 
283,235

 
—

Residential mortgage loans held for sale
 
149,221

 
—

 
134,014

 
15,207

Mortgage servicing rights1
 
259,254

 
—

 
—

 
259,254

Derivative contracts, net of cash collateral2
 
320,929

 
44,074

 
276,855

 
—

Liabilities:
 


 
 
 
 
 
 
Derivative contracts, net of cash collateral2
 
362,306

 
—

 
362,306

 
—

1 
A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 6, Mortgage Banking Activities.
2 
See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts based on quoted prices in active markets for identical instruments (Level 1) are exchange-traded interest rate, energy and agricultural derivative contacts, net of cash margin. Derivative contracts in liability positions that were valued using quoted prices in active markets for identical instruments (Level 1) are exchange-traded interest rate contracts, fully offset by cash margin.
Fair Value Assets Measured On Recurring Basis, Significant Unobservable Inputs [Table Text Block] The following represents the changes for the three months ended March 31, 2019 related to assets measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
 
 
Available for Sale Securities
 
 
 
 
Municipal and other tax-exempt securities
 
Other debt securities
 
Residential mortgage loans held for sale
Balance, December 31, 2018
 
$
—

 
$
472

 
$
15,207

Transfer to Level 3 from Level 21
 
—

 
—

 
982

Purchases
 
—

 
—

 
—

Proceeds from sales
 
—

 
—

 
(381
)
Redemptions and distributions
 
—

 
—

 
—

Gain (loss) recognized in earnings:
 
 
 
 
 
 
Mortgage banking revenue
 
—

 
—

 
(32
)
Other comprehensive income (loss):
 
 
 
 
 
 
Net change in unrealized gain (loss)
 
—

 
—

 
—

Balance, March 31, 2019
 
$
—

 
$
472

 
$
15,776

1  
Recurring transfers to Level 3 from Level 2 consist of residential mortgage loans intended for sale to U.S. government agencies that fail to meet conforming standards.
 
 
 
 
 
 
 


The following represents the changes for the three months ended March 31, 2018 related to assets measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
 
 
Available for Sale Securities
 
 
 
 
Municipal and other tax-exempt securities
 
Other debt securities
 
Residential mortgage loans held for sale
Balance, December 31, 2017
 
$
4,802

 
$
472

 
$
12,299

Transfer to Level 3 from Level 21
 
—

 
—

 
2,156

Purchases
 
—

 
—

 
—

Proceeds from sales
 
—

 
—

 
(324
)
Redemptions and distributions
 
(3,045
)
 
—

 
—

Gain (loss) recognized in earnings:
 
 
 
 
 
 
Mortgage banking revenue
 
—

 
—

 
(260
)
Other comprehensive income (loss):
 
 
 
 
 
 
Net change in unrealized gain (loss)
 
134

 
—

 
—

Balance, March 31, 2018
 
$
1,891

 
$
472

 
$
13,871

1 
Recurring transfers to Level 3 from Level 2 consist of residential mortgage loans intended for sale to U.S. government agencies that fail to meet conforming standards.
Fair Value Inputs, Fair Value Measured On a Recurring Basis, Quantitative Information [Table Text Block] A summary of quantitative information about assets measured at fair value on a recurring basis using Significant Unobservable Inputs (Level 3) as of March 31, 2019 follows (in thousands):
 
 
Fair
Value
 
Valuation Technique(s)
 
Unobservable Input
 
Range
(Weighted Average)
 
 
 
 
 
 
 
 
 
 
 
Available for sale securities – Other debt securities
 
472

 
Discounted cash flows
1 
Interest rate spread
 
6.83%-6.83% (6.83%)
3 
94.39%-94.39% (94.39%)
2 
Residential mortgage loans held for sale
 
15,766

 
Quoted prices of loans sold in securitization transactions, with a liquidity discount applied
 
Liquidity discount applied to the market value of mortgage loans qualifying for sale to U.S. government agencies.
 
92.40%
 
1 
Discounted cash flows developed using discount rates primarily based on reference to interest rate spreads for comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies, adjusted for lack of trading volume.
2 
Represents fair value as a percentage of par value.
3 
Interest rate yields used to value investment grade taxable securities based on comparable short-term taxable securities which are generally yielding less than 3 percent.

A summary of quantitative information about assets measured at fair value on a recurring basis using Significant Unobservable Inputs (Level 3) as of December 31, 2018 follows (in thousands):
 
 
Fair
Value
 
Valuation Technique(s)
 
Unobservable Input
 
Range
(Weighted Average)
 
 
 
 
 
 
 
 
 
 
 
Available for sale securities – Other debt securities
 
472

 
Discounted cash flows
1 
Interest rate spread
 
7.88%-7.88% (7.88%)
3 
94.44%-94.44% (94.44%)
2 
Residential mortgage loans held for sale
 
15,207

 
Quoted prices of loans sold in securitization transactions, with a liquidity discount applied
 
Liquidity discount applied to the market value of mortgage loans qualifying for sale to U.S. government agencies.
 
92.38%
 
1 
Discounted cash flows developed using discount rates primarily based on reference to interest rate spreads for comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies, adjusted for lack of trading volume
2 
Represents fair value as a percentage of par value.
3 
Interest rate yields used to value investment grade taxable securities based on comparable short-term taxable securities which are generally yielding less than 3 percent.
Fair Value Assets Measured on Nonrecurring Basis [Table Text Block] The following represents the carrying value of assets measured at fair value on a non-recurring basis (and related losses) during the period. The carrying value represents only those assets with a balance at March 31, 2019 for which the fair value was adjusted during the three months ended March 31, 2019:
 
 
 
 
 
 
 
Fair Value Adjustments for the
 
Carrying Value at March 31, 2019
 
Three Months Ended
March 31, 2019
Recognized in:
 
Quoted Prices
in Active Markets for Identical Instruments
 
Significant
Other
Observable
Inputs
 
Significant
Unobservable
Inputs
 
Gross charge-offs against allowance for loan losses
 
Net losses and expenses of repossessed assets, net
Impaired loans
$
—

 
$
—

 
$
9,712

 
$
9,581

 
$
—

Real estate and other repossessed assets
—

 
2,688

 
144

 
—

 
434

 
The following represents the carrying value of assets measured at fair value on a non-recurring basis (and related losses) during the period. The carrying value represents only those assets with a balance at March 31, 2018 for which the fair value was adjusted during the three months ended March 31, 2018:
 
 
 
 
 
 
 
Fair Value Adjustments for the
 
Carrying Value at March 31, 2018
 
Three Months Ended
March 31, 2018
Recognized in:
 
Quoted Prices
in Active Markets for Identical Instruments
 
Significant
Other
Observable
Inputs
 
Significant
Unobservable
Inputs
 
Gross charge-offs against allowance for loan losses
 
Net losses and expenses of repossessed assets, net
Impaired loans
$
—

 
$
32

 
$
410

 
$
497

 
$
—

Real estate and other repossessed assets
—

 
863

 
7,094

 
—

 
5,192
Fair Value Inputs, Fair Value Measured On a Nonrecurring Basis, Quantitative Information [Table Text Block] A summary of quantitative information about Non-recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of March 31, 2019 follows (in thousands):
 
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input
 
Range
(Weighted Average)
Impaired loans
 
$
9,712

 
Discounted cash flows
 
Management knowledge of industry and non-real estate collateral including but not limited to recoverable oil and gas reserves, forward-looking commodity prices, estimated operating costs
 
14% - 74% (31%)1
Real estate and other repossessed assets
 
144

 
Appraised value, as adjusted
 
Marketability adjustments off appraised value2
 
75% - 85% (79%)
1 
Represents fair value as a percentage of the unpaid principal balance.
2 
Marketability adjustments include consideration of estimated costs to sell which is approximately 10% of the fair value.

A summary of quantitative information about Non-recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of December 31, 2018 follows (in thousands):
 
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input
 
Range
(Weighted Average)
Impaired loans
 
$
17,401

 
Discounted cash flows
 
Management knowledge of industry and non-real estate collateral including but not limited to recoverable oil and gas reserves, forward-looking commodity prices, estimated operating costs
 
35% - 80% (50%)1
Real estate and other repossessed assets
 
6,366

 
Discounted cash flows
 
Recoverable oil and gas reserves, forward-looking commodity prices, estimated operating costs
 
N/A

1  
Represents fair value as a percentage of the unpaid principal balance.
Fair Value of Financial Instruments [Table Text Block] The following table presents the carrying values and estimated fair values of all financial instruments, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis as of March 31, 2019 (dollars in thousands):
 
 
Carrying
Value
 
Estimated
Fair
Value
 
Quoted Prices in Active Markets for Identical Instruments (Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
Cash and due from banks
 
$
718,297

 
$
718,297

 
$
718,297

 
$
—

 
$
—

Interest-bearing cash and cash equivalents
 
564,404

 
564,404

 
564,404

 
—

 
—

Trading securities:
 
 
 
 
 
 
 
 
 
 
U.S. government agency debentures
 
51,576

 
51,576

 
—

 
51,576

 
—

U.S. government agency residential mortgage-backed securities
 
1,952,742

 
1,952,742

 
—

 
1,952,742

 
—

Municipal and other tax-exempt securities
 
50,637

 
50,637

 
—

 
50,637

 
—

Asset-backed securities
 
40,890

 
40,890

 
—

 
40,890

 
—

Other trading securities
 
44,481

 
44,481

 
—

 
44,481

 
—

Total trading securities
 
2,140,326

 
2,140,326

 
—

 
2,140,326

 
—

Investment securities:
 
 

 
 

 
 
 
 
 
 
Municipal and other tax-exempt securities
 
126,544

 
129,072

 
—

 
129,072

 
—

U.S. government agency residential mortgage-backed securities
 
12,106

 
12,388

 
—

 
12,388

 
—

Other debt securities
 
192,816

 
207,028

 
—

 
8,209

 
198,819

Total investment securities
 
331,466

 
348,488

 
—

 
149,669

 
198,819

Available for sale securities:
 
 

 
 

 
 
 
 
 
 
U.S. Treasury
 
1,878

 
1,878

 
1,878

 
—

 
—

Municipal and other tax-exempt securities
 
2,447

 
2,447

 
—

 
2,447

 
—

Residential agency mortgage-backed securities
 
6,040,086

 
6,040,086

 
—

 
6,040,086

 
—

Residential non-agency mortgage-backed securities
 
47,958

 
47,958

 
—

 
47,958

 
—

Commercial agency mortgage-backed securities
 
2,932,357

 
2,932,357

 
—

 
2,932,357

 
—

Other debt securities
 
472

 
472

 
—

 
—

 
472

Total available for sale securities
 
9,025,198

 
9,025,198

 
1,878

 
9,022,848

 
472

Fair value option securities – U.S. government agency residential mortgage-backed securities
 
707,994

 
707,994

 
—

 
707,994

 
—

Residential mortgage loans held for sale
 
160,157

 
160,157

 
—

 
144,381

 
15,776

Loans:
 
 

 
 

 
 
 
 
 
 
Commercial
 
13,961,975

 
13,886,769

 
—

 
—

 
13,886,769

Commercial real estate
 
4,600,651

 
4,589,189

 
—

 
—

 
4,589,189

Residential mortgage
 
2,192,620

 
2,196,914

 
—

 
—

 
2,196,914

Personal
 
1,003,734

 
1,001,193

 
—

 
—

 
1,001,193

Total loans
 
21,758,980

 
21,674,065

 
—

 
—

 
21,674,065

Allowance for loan losses
 
(205,340
)
 
—

 
—

 
—

 
—

Loans, net of allowance
 
21,553,640

 
21,674,065

 
—

 
—

 
21,674,065

Mortgage servicing rights
 
238,193

 
238,193

 
—

 
—

 
238,193

Derivative instruments with positive fair value, net of cash collateral
 
359,223

 
359,223

 
4,720

 
354,503

 
—

Deposits with no stated maturity
 
23,133,413

 
23,133,413

 
—

 
—

 
23,133,413

Time deposits
 
2,198,389

 
2,181,872

 
—

 
—

 
2,181,872

Other borrowed funds
 
8,780,766

 
8,750,845

 
—

 
—

 
8,750,845

Subordinated debentures
 
275,880

 
273,656

 
—

 
273,656

 
—

Derivative instruments with negative fair value, net of cash collateral
 
299,698

 
299,698

 
—

 
299,698

 
—

The following table presents the carrying values and estimated fair values of all financial instruments, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis as of December 31, 2018 (dollars in thousands):
 
 
Carrying
Value
 
Estimated
Fair
Value
 
Quoted Prices in Active Markets for Identical Instruments (Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
Cash and due from banks
 
$
741,749

 
$
741,749

 
$
741,749

 
$
—

 
$
—

Interest-bearing cash and cash equivalents
 
401,675

 
401,675

 
401,675

 
—

 
—

Trading securities:
 
 
 
 
 
 
 
 
 
 
U.S. government agency debentures
 
63,765

 
63,765

 
—

 
63,765

 
—

U.S. government agency residential mortgage-backed securities
 
1,791,584

 
1,791,584

 
—

 
1,791,584

 
—

Municipal and other tax-exempt securities
 
34,507

 
34,507

 
—

 
34,507

 
—

Asset-backed securities
 
42,656

 
42,656

 
—

 
42,656

 
—

Other trading securities
 
24,411

 
24,411

 
—

 
24,411

 
—

Total trading securities
 
1,956,923

 
1,956,923

 
—

 
1,956,923

 
—

Investment securities:
 
 

 
 

 
 
 
 
 
 
Municipal and other tax-exempt securities
 
137,296

 
138,562

 
—

 
138,562

 
—

U.S. government agency residential mortgage-backed securities
 
12,612

 
12,770

 
—

 
12,770

 
—

Other debt securities
 
205,279

 
215,966

 
—

 
7,905

 
208,061

Total investment securities
 
355,187

 
367,298

 
—

 
159,237

 
208,061

Available for sale securities:
 
 

 
 

 
 
 
 
 
 
U.S. Treasury
 
493

 
493

 
493

 
—

 
—

Municipal and other tax-exempt securities
 
2,864

 
2,864

 
—

 
2,864

 
—

Residential agency mortgage-backed securities
 
5,804,708

 
5,804,708

 
—

 
5,804,708

 
—

Residential non-agency mortgage-backed securities
 
59,736

 
59,736

 
—

 
59,736

 
—

Commercial agency mortgage-backed securities
 
2,953,889

 
2,953,889

 
—

 
2,953,889

 
—

Other debt securities
 
35,430

 
35,430

 
—

 
34,958

 
472

Total available for sale securities
 
8,857,120

 
8,857,120

 
493

 
8,856,155

 
472

Fair value option securities – U.S. government agency residential mortgage-backed securities
 
283,235

 
283,235

 
—

 
283,235

 
—

Residential mortgage loans held for sale
 
149,221

 
149,221

 
—

 
134,014

 
15,207

Loans:
 
 

 
 

 
 
 
 
 
 
Commercial
 
13,636,078

 
13,526,162

 
—

 
—

 
13,526,162

Commercial real estate
 
4,764,813

 
4,713,747

 
—

 
—

 
4,713,747

Residential mortgage
 
2,230,033

 
2,213,951

 
—

 
—

 
2,213,951

Personal
 
1,025,806

 
1,024,368

 
—

 
—

 
1,024,368

Total loans
 
21,656,730

 
21,478,228

 
—

 
—

 
21,478,228

Allowance for loan losses
 
(207,457
)
 
—

 
—

 
—

 
—

Loans, net of allowance
 
21,449,273

 
21,478,228

 
—

 
—

 
21,478,228

Mortgage servicing rights
 
259,254

 
259,254

 
—

 
—

 
259,254

Derivative instruments with positive fair value, net of cash collateral
 
320,929

 
320,929

 
44,074

 
276,855

 
—

Deposits with no stated maturity
 
23,150,383

 
23,150,383

 
—

 
—

 
23,150,383

Time deposits
 
2,113,380

 
2,073,538

 
—

 
—

 
2,073,538

Other borrowed funds
 
7,142,801

 
7,071,953

 
—

 
—

 
7,071,953

Subordinated debentures
 
275,913

 
261,977

 
—

 
261,977

 
—

Derivative instruments with negative fair value, net of cash collateral
 
362,306

 
362,306

 
—

 
362,306

 
—