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Fair Value of Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Balances of Assets and Liabilities Measured at Fair Value on Recurring Basis

The table below presents the balances of assets and liabilities measured at fair value on a recurring basis as of December 31, 2021, and December 31, 2020:

(dollars in thousands)		Quoted Prices In Active Markets for Identical Assets or Liabilities (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
December 31, 2021
Assets:
Investment Securities Available-for-Sale
Debt Securities Issued by the U.S. Treasury    and Government Agencies		$	114,845			$	135,242			$	—			$	250,087
Debt Securities Issued by States and Political Subdivisions			—				75,818				—				75,818
Debt Securities Issued by    U.S. Government-Sponsored Enterprises			—				1,780				—				1,780
Debt Securities Issued by Corporations			—				383,113				—				383,113
Mortgage-Backed Securities:
Residential - Government Agencies			—				1,319,042				—				1,319,042
Residential - U.S. Government-Sponsored Enterprises			—				2,090,326				—				2,090,326
Commercial - Government Agencies			—				155,890				—				155,890
Total Mortgage-Backed Securities			—				3,565,258				—				3,565,258
Total Investment Securities Available-for-Sale			114,845				4,161,211				—				4,276,056
Loans Held for Sale			—				26,746				—				26,746
Mortgage Servicing Rights			—				—				800				800
Other Assets			56,411				—				—				56,411
Derivatives 1			—				194				41,817				42,011
Total Assets Measured at Fair Value on a    Recurring Basis as of December 31, 2021		$	171,256			$	4,188,151			$	42,617			$	4,402,024
Liabilities:
Derivatives 1		$	—			$	903			$	17,913			$	18,816
Total Liabilities Measured at Fair Value on a    Recurring Basis as of December 31, 2021		$	—			$	903			$	17,913			$	18,816
December 31, 2020
Assets:
Investment Securities Available-for-Sale
Debt Securities Issued by the U.S. Treasury    and Government Agencies		$	921			$	173,324			$	—			$	174,245
Debt Securities Issued by States and Political Subdivisions			—				24,840				—				24,840
Debt Securities Issued by U.S. Government-Sponsored Enterprises			—				1,062				—				1,062
Debt Securities Issued by Corporations			—				224,605				—				224,605
Mortgage-Backed Securities:
Residential - Government Agencies			—				1,594,815				—				1,594,815
Residential - U.S. Government-Sponsored Enterprises			—				1,518,283				—				1,518,283
Commercial - Government Agencies			—				253,839				—				253,839
Total Mortgage-Backed Securities			—				3,366,937				—				3,366,937
Total Investment Securities Available-for-Sale			921				3,790,768				—				3,791,689
Loans Held for Sale			—				82,565				—				82,565
Mortgage Servicing Rights			—				—				958				958
Other Assets			53,410				—				—				53,410
Derivatives 1			—				878				95,289				96,167
Total Assets Measured at Fair Value on a    Recurring Basis as of December 31, 2020		$	54,331			$	3,874,211			$	96,247			$	4,024,789
Liabilities:
Derivatives 1		$	—			$	752			$	17,409			$	18,161
Total Liabilities Measured at Fair Value on a    Recurring Basis as of December 31, 2020		$	—			$	752			$	17,409			$	18,161

¹ The fair value of each class of derivatives is shown in Note 17 Derivative Financial Instruments.

Changes in Level 3 Assets and Liabilities Measured at Fair Value on Recurring Basis

For the years ended December 31, 2021, and December 31, 2020, the changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:

(dollars in thousands)		Mortgage Servicing Rights 1				Net Derivative Assets and Liabilities 2
Year Ended December 31, 2021
Balance as of January 1, 2021		$	958			$	77,880
Realized and Unrealized Net Gains (Losses):
Included in Net Income			(158	)			8,848
Transfers to Loans Held for Sale			—				(12,634	)
Variation Margin Payments			—				(50,190	)
Balance as of December 31, 2021		$	800			$	23,904
Total Unrealized Net Gains (Losses) Included in Net Income    Related to Assets Still Held as of December 31, 2021		$	—			$	23,904
Year Ended December 31, 2020
Balance as of January 1, 2020		$	1,126			$	22,573
Realized and Unrealized Net Gains (Losses):
Included in Net Income			(168	)			22,219
Transfers to Loans Held for Sale			—				(18,681	)
Variation Margin Payments			—				51,769
Balance as of December 31, 2020		$	958			$	77,880
Total Unrealized Net Gains (Losses) Included in Net Income    Related to Assets Still Held as of December 31, 2020		$	—			$	77,880

¹ Realized and unrealized gains and losses related to mortgage servicing rights are reported as a component of mortgage banking income in the Company’s consolidated statements of income.

^{2 Realized and unrealized gains and losses related to interest rate lock commitments are reported as a component of mortgage banking income in the Company’s consolidated statements of income. Realized and unrealized gains and losses related to interest rate swap agreements are reported as a component of other noninterest income in the Company’s consolidated statements of income.}

Summary of the Significant Unobservable Inputs

For Level 3 assets and liabilities measured at fair value on a recurring or nonrecurring basis as of December 31, 2021, and December 31, 2020, the significant unobservable inputs used in the fair value measurements were as follows:

				December 31, 2021																		December 31, 2020
(dollars in thousands)		Valuation Technique		Description		Range								Weighted Average1				Fair Value				Weighted Average1				Fair Value
Mortgage Servicing Rights		Discounted Cash Flow		Constant Prepayment Rate			6.51	%	-		11.48	%			10.70	%		$	22,251				14.42	%		$	19,652
				Discount Rate			6.49	%	-		7.08	%			7.04	%							5.81	%
Net Derivative Assets and Liabilities:
Interest Rate Lock Commitments		Pricing Model		Closing Ratio			75.40	%	-		100.00	%			90.47	%		$	1,084				90.76	%		$	4,947
Interest Rate Swap Agreements		Discounted Cash Flow		Credit Factor			0.00	%	-		0.49	%			0.14	%		$	22,820				0.29	%		$	72,933

¹ Unobservable inputs for mortgage servicing rights and interest rate lock commitments were weighted by loan amount. Unobservable inputs for interest rate swap agreements were weighted by fair value.

Schedule of Assets Measured at Fair Value on Nonrecurring Basis

The Company may be required periodically to measure certain assets and liabilities at fair value on a nonrecurring basis in accordance with GAAP.  These adjustments to fair value usually result from the application of lower-of-cost-or-fair value accounting or impairment write-downs of individual assets.  The following table represents the assets measured at fair value on a nonrecurring basis as of December 31, 2021.

(dollars in thousands)		Fair Value Hierarchy		Net Carrying Amount				Valuation Allowance
December 31, 2021
Mortgage Servicing Rights - amortization method		Level 3		$	21,451			$	(1,829	)
December 31, 2020
Mortgage Servicing Rights - amortization method		Level 3		$	18,694			$	(3,892	)

Schedule of Difference between Aggregate Fair Value and Aggregate Unpaid Principal Balance

The following table reflects the difference between the aggregate fair value and the aggregate unpaid principal balance of the Company’s residential mortgage loans held for sale as of December 31, 2021, and December 31, 2020.

(dollars in thousands)		Aggregate Fair Value				Aggregate Unpaid Principal				Aggregate Fair Value Less Aggregate Unpaid Principal
December 31, 2021
Loans Held for Sale		$	26,746			$	26,309			$	437
December 31, 2020
Loans Held for Sale		$	82,565			$	78,577			$	3,988

Schedule of Carrying Amount, Fair Value, and Fair Value Hierarchy of Financial Instruments

The following presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments not recorded at fair value on a recurring basis as of December 31, 2021, and December 31, 2020.  This table excludes financial instruments for which the carrying amount approximates fair value.  For short-term financial assets such as cash and cash equivalents, the carrying amount is a reasonable estimate of fair value due to the relatively short time between the origination of the instrument and its expected realization.  For non-marketable equity securities such as Federal Home Loan Bank of Des Moines and Federal Reserve Bank stock, the carrying amount is a reasonable estimate of fair value as these securities can only be redeemed or sold at their par value and only to the respective issuing government supported institution or to another member institution.  For financial liabilities such as noninterest-bearing demand, interest-bearing demand, and savings deposits, the carrying amount is a reasonable estimate of fair value due to these products having no stated maturity.

										Fair Value Measurements
(dollars in thousands)		Carrying Amount				Fair Value				Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
December 31, 2021
Financial Instruments – Assets
Investment Securities Held-to-Maturity		$	4,694,780			$	4,646,619			$	131,139			$	4,515,480			$	—
Loans			11,921,869				12,094,631				—				—				12,094,631
Financial Instruments – Liabilities
Time Deposits			1,000,089				998,134				—				998,134				—
Securities Sold Under Agreements to Repurchase			450,490				469,293				—				469,293				—
December 31, 2020
Financial Instruments – Assets
Investment Securities Held-to-Maturity		$	3,262,727			$	3,348,693			$	7,500			$	3,341,193			$	—
Loans			11,536,011				12,019,151				—				—				12,019,151
Financial Instruments – Liabilities
Time Deposits			1,662,063				1,667,774				—				1,667,774				—
Securities Sold Under Agreements to Repurchase			600,590				649,039				—				649,039				—
Other Debt 1			50,000				51,546				—				51,546				—

¹ Excludes finance lease obligations.

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