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Disclosures about Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Estimated Fair Values of Financial Instruments

The estimated fair values of Customers’ financial instruments at December 31, 2018 and 2017 were as follows:

	Carrying Amount				Estimated Fair Value				Fair Value Measurements at December 31, 2018
									Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
(amounts in thousands)
Assets
Cash and cash equivalents	$	62,135			$	62,135			$	62,135			$	—			$	—
Debt securities, available for sale	663,294				663,294				—				663,294				—
Equity securities	1,718				1,718				1,718				—				—
Loans held for sale	1,507				1,507				—				1,507				—
Total loans receivable, net of allowance for loan losses	8,503,522				8,481,128				—				1,405,420				7,075,708
FHLB, Federal Reserve Bank and other restricted stock	89,685				89,685				—				89,685				—
Derivatives	14,693				14,693				—				14,624				69
Liabilities
Deposits	$	7,142,236			$	7,136,009			$	5,408,055			$	1,727,954			$	—
Federal funds purchased	187,000				187,000				187,000				—				—
FHLB advances	1,248,070				1,248,046				998,070				249,976				—
Other borrowings	123,871				121,718				—				121,718				—
Subordinated debt	108,977				110,550				—				110,550				—
Derivatives	16,286				16,286				—				16,286				—

	Carrying Amount				Estimated Fair Value				Fair Value Measurements at December 31, 2017
									Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
(amounts in thousands)
Assets
Cash and cash equivalents	$	146,323			$	146,323			$	146,323			$	—			$	—
Investment securities, available for sale	471,371				471,371				3,352				468,019				—
Loans held for sale	146,077				146,251				—				1,886				144,365
Total loans receivable, net of allowance for loan losses	8,523,651				8,470,171				—				1,793,408				6,676,763
FHLB, Federal Reserve Bank, and other restricted stock	105,918				105,918				—				105,918				—
Derivatives	9,752				9,752				—				9,692				60
Liabilities
Deposits	$	6,800,142			$	6,796,095			$	4,894,449			$	1,901,646			$	—
Federal funds purchased	155,000				155,000				155,000				—				—
FHLB advances	1,611,860				1,611,603				881,860				729,743				—
Other borrowings	186,497				193,557				65,072				128,485				—
Subordinated debt	108,880				115,775				—				115,775				—
Derivatives	10,074				10,074				—				10,074				—

Summary of Financial Assets and Liabilities Measured at Fair Value on a Recurring and Non-recurring Basis

For financial assets and liabilities measured at fair value on a recurring and non-recurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2018 and 2017, were as follows:

	December 31, 2018
	Fair Value Measurements at the End of the Reporting Period Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
(amounts in thousands)
Measured at Fair Value on a Recurring Basis
Assets
Available-for-sale securities
Agency-guaranteed residential mortgage-backed securities	$	—			$	305,374			$	—			$	305,374
Corporate notes	—				357,920				—				357,920
Equity securities	1,718				—				—				1,718
Derivatives	—				14,624				69				14,693
Loans held for sale – fair value option	—				1,507				—				1,507
Loans receivable, mortgage warehouse – fair value option	—				1,405,420				—				1,405,420
Total assets - recurring fair value measurements	$	1,718			$	2,084,845			$	69			$	2,086,632
Liabilities
Derivatives	$	—			$	16,286			$	—			$	16,286
Measured at Fair Value on a Nonrecurring Basis
Assets
Impaired loans, net of specific reserves of $845	$	—			$	—			$	10,876			$	10,876
Other real estate owned	—				—				621				621
Total assets - nonrecurring fair value measurements	$	—			$	—			$	11,497			$	11,497

	December 31, 2017
	Fair Value Measurements at the End of the Reporting Period Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)				Total
(amounts in thousands)
Measured at Fair Value on a Recurring Basis
Assets
Available-for-sale securities:
Agency-guaranteed residential mortgage-backed securities	$	—			$	183,458			$	—			$	183,458
Agency-guaranteed commercial mortgage-backed securities	—				238,472				—				238,472
Corporate notes	—				46,089				—				46,089
Equity securities	3,352				—				—				3,352
Derivatives	—				9,692				60				9,752
Loans held for sale – fair value option	—				1,886				—				1,886
Loans receivable, mortgage warehouse – fair value option	—				1,793,408				—				1,793,408
Total assets - recurring fair value measurements	$	3,352			$	2,273,005			$	60			$	2,276,417
Liabilities
Derivatives	$	—			$	10,074			$	—			$	10,074
Measured at Fair Value on a Nonrecurring Basis
Assets
Impaired loans, net of specific reserves of $1,451	$	—			$	—			$	13,902			$	13,902
Other real estate owned	—				—				1,449				1,449
Total assets - nonrecurring fair value measurements	$	—			$	—			$	15,351			$	15,351

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

The changes in Level 3 assets and liabilities measured at fair value on a recurring basis at December 31, 2018 and 2017, are summarized as follows in the tables below. Additional information about residential mortgage loan commitments can be found in NOTE 19 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES.

		For the Years Ended December 31,
		2018				2017
		Residential Mortgage Loan Commitments
(amounts in thousands)
Balance at December 31,		$	60			$	45
Issuances		407				360
Settlements		(398		)		(345		)
Balance at December 31,		$	69			$	60

Summary of Financial Assets and Financial Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis

The following table summarizes financial assets and financial liabilities measured at fair value as of December 31, 2018 and 2017 on a recurring and nonrecurring basis for which Customers utilized Level 3 inputs to measure fair value. The unobservable Level 3 inputs noted below contain a level of uncertainty that may differ from what is realized in an immediate settlement of the assets. Therefore, Customers may realize a value higher or lower than the current estimated fair value of the assets.

	Quantitative Information about Level 3 Fair Value Measurements
December 31, 2018	Fair Value Estimate				Valuation Technique		Unobservable Input		Range (Weighted Average) (4)
(dollars in thousands)
Impaired loans - real estate	$	10,260			Collateral appraisal (1)		Liquidation expenses (2)		8% - 8% (8%)
Impaired loans - Commercial & Industrial	616				Business asset valuation(3)		Business asset valuation adjustments (4)		8% - 50% (26%)
Other real estate owned	621				Collateral appraisal (1)		Liquidation expenses (2)		8% - 8% (8%)
Residential mortgage loan commitments	69				Adjusted market bid		Pull-through rate		90% - 90% (90%)

	Quantitative Information about Level 3 Fair Value Measurements
December 31, 2017	Fair Value Estimate				Valuation Technique		Unobservable Input		Range (Weighted Average) (4)
(dollars in thousands)
Impaired loans	$	13,902			Collateral appraisal (1)		Liquidation expenses (2)		8% - 8% (8%)
Other real estate owned	1,449				Collateral appraisal (1)		Liquidation expenses (2)		8% - 8% (8%)
Residential mortgage loan commitments	60				Adjusted market bid		Pull-through rate		90% - 90% (90%)

(1) Obtained from approved independent appraisers.  Appraisals are current and in compliance with credit policy. The Bank does not generally discount appraisals.

(2) Appraisals are adjusted by management for liquidation expenses. The range and weighted average of liquidation expense adjustments are presented as a percentage of the appraisal.

(3) Business asset valuation obtained from independent party.

(4) Business asset valuations may be adjusted by management for qualitative factors including economic conditions and the condition of the business assets. The range and weighted average of the business asset adjustments are presented as a percent of the business asset valuation.

X

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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