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FAIR VALUE (Tables)

9 Months Ended

Sep. 30, 2021

Fair Value Measured on a Recurring Basis

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following tables set forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis. There were no transfers between any of the levels for the periods presented.


		September 30, 2021
											Total Fair
(000’s omitted)		Level 1			Level 2			Level 3			Value
Available-for-sale investment securities:
U.S. Treasury and agency securities		$	3,293,134		$	100,126		$	0		$	3,393,260
Obligations of state and political subdivisions			0			421,965			0			421,965
Government agency mortgage-backed securities			0			510,676			0			510,676
Corporate debt securities			0			8,078			0			8,078
Government agency collateralized mortgage obligations			0			24,392			0			24,392
Total available-for-sale investment securities			3,293,134			1,065,237			0			4,358,371
Equity securities			459			0			0			459
Mortgage loans held for sale			0			117			0			117
Commitments to originate real estate loans for sale			0			0			45			45
Forward sales commitments			0			53			0			53
Interest rate swap agreements asset			0			335			0			335
Interest rate swap agreements liability			0			(5)			0			(5)
Total		$	3,293,593		$	1,065,737		$	45		$	4,359,375


		December 31, 2020
											Total Fair
(000’s omitted)		Level 1			Level 2			Level 3			Value
Available-for-sale investment securities:
U.S. Treasury and agency securities		$	2,359,912		$	141,470		$	0		$	2,501,382
Obligations of state and political subdivisions			0			475,660			0			475,660
Government agency mortgage-backed securities			0			522,638			0			522,638
Corporate debt securities			0			4,635			0			4,635
Government agency collateralized mortgage obligations			0			43,577			0			43,577
Total available-for-sale investment securities			2,359,912			1,187,980			0			3,547,892
Equity securities			445			0			0			445
Mortgage loans held for sale			0			1,622			0			1,622
Commitments to originate real estate loans for sale			0			0			14			14
Forward sales commitments			0			2			0			2
Interest rate swap agreements asset			0			1,572			0			1,572
Interest rate swap agreements liability			0			(1,074)			0			(1,074)
Total		$	2,360,357		$	1,190,102		$	14		$	3,550,473

Assets and Liabilities Measured on a Non-Recurring Basis

The fair value information of assets and liabilities measured on a non-recurring basis presented below is not as of the period-end, but rather as of the date the fair value adjustment was recorded closest to the date presented.


		September 30, 2021												December 31, 2020
											Total Fair												Total Fair
(000's omitted)		Level 1			Level 2			Level 3			Value			Level 1			Level 2			Level 3			Value
Individually assessed loans		$	0		$	0		$	18,794		$	18,794		$	0		$	0		$	25,063		$	25,063
Other real estate owned			0			0			891			891			0			0			883			883
Mortgage servicing rights			0			0			794			794			0			0			682			682
Contingent consideration			0			0			2,900			2,900			0			0			0			0
Total		$	0		$	0		$	23,379		$	23,379		$	0		$	0		$	26,628		$	26,628

Significant Unobservable Inputs, Fair Value Valuation Techniques

The Company determines fair values based on quoted market values, where available, estimates of present values, or other valuation techniques. Those techniques are significantly affected by the assumptions used, including, but not limited to, the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in immediate settlement of the instrument. The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis are as follows:


									Significant
									Unobservable Input
		Fair Value at							Range
(000's omitted, except per loan data)		September 30, 2021			Valuation Technique		Significant Unobservable Inputs		(Weighted Average)
Individually assessed loans		$	18,794		Fair value of collateral		Estimated cost of disposal/market adjustment			9.0% - 78.7% (53.5%)
Other real estate owned			891		Fair value of collateral		Estimated cost of disposal/market adjustment			9.0% - 46.7% (33.7%)
Commitments to originate real estate loans for sale			45		Discounted cash flow		Embedded servicing value			1.0	%
Mortgage servicing rights			794		Discounted cash flow		Weighted average constant prepayment rate			15.2% - 24.9% (16.6%)
							Weighted average discount rate			2.3% - 2.8% (2.7%)
							Adequate compensation		$	7/loan
Contingent consideration			2,900		Discounted cash flow		Discount rate			0.8% - 1.1% (1.0%)
							Probability adjusted level of retained			$2.3 million - $5.8
							revenue			million


									Significant
									Unobservable Input
		Fair Value at							Range
(000's omitted, except per loan data)		December 31, 2020			Valuation Technique		Significant Unobservable Inputs		(Weighted Average)
Individually assessed loans		$	25,063		Fair value of collateral		Estimated cost of disposal/market adjustment			9.0% - 78.4% (52.7%)
Other real estate owned			883		Fair value of collateral		Estimated cost of disposal/market adjustment			11.3% - 52.9% (34.0%)
Commitments to originate real estate loans for sale			14		Discounted cash flow		Embedded servicing value			1.0	%
Mortgage servicing rights			682		Discounted cash flow		Weighted average constant prepayment rate			9.8% - 18.8% (17.6%)
							Weighted average discount rate			1.7% - 2.2% (2.1%)
							Adequate compensation		$	7/loan

Carrying Amounts and Estimated Fair Values of Other Financial Instruments

Certain financial instruments and all nonfinancial instruments are excluded from fair value disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The carrying amounts and estimated fair values of the Company’s other financial instruments that are not accounted for at fair value at September 30, 2021 and December 31, 2020 are as follows:


		September 30, 2021						December 31, 2020
		Carrying			Fair			Carrying			Fair
(000's omitted)		Value			Value			Value			Value
Financial assets:
Net loans		$	7,233,083		$	7,608,456		$	7,355,083		$	7,655,044
Financial liabilities:
Deposits			12,723,821			12,730,674			11,224,974			11,239,628
Securities sold under agreement to repurchase, short-term			316,763			316,763			284,008			284,008
Other Federal Home Loan Bank borrowings			2,912			2,956			6,658			6,758
Subordinated notes payable			3,283			3,283			3,303			3,303
Subordinated debt held by unconsolidated subsidiary trusts			0			0			77,320			77,320