Fair value measurements (Tables)

9 Months Ended

Sep. 30, 2015

Schedule of estimated fair values of certain of the Company's financial instruments

The following table presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments. For stock in Federal Home Loan Bank, the carrying amount is a reasonable estimate of fair value. For financial liabilities such as noninterest-bearing demand, interest-bearing demand, and savings and money market deposits, the carrying amount is a reasonable estimate of fair value as these liabilities have no stated maturity.



			Estimated fair value
	Carrying amount		Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
(in thousands)	Carrying amount		(Level 1)		(Level 2)		(Level 3)		Total
September 30, 2015
Financial assets
Money market funds	$	10	$	—	$	10	$	—	$	10
Available-for-sale investment securities	785,837		—		785,837		—		785,837
Stock in Federal Home Loan Bank	10,678		—		10,678		—		10,678
Loans receivable, net	4,492,728		—		—		4,700,042		4,700,042
Derivative assets	586		—		586		—		586
Financial liabilities
Deposit liabilities	4,825,954		—		4,828,402		—		4,828,402
Short-term borrowings—other than bank	171,992		—		171,992		—		171,992
The Utilities’ short-term borrowings (included in amount above)	94,995		—		94,995		—		94,995
Other bank borrowings	368,593		—		375,428		—		375,428
Long-term debt, net—other than bank	1,506,546		—		1,595,161		—		1,595,161
The Utilities’ long-term debt, net (included in amount above)	1,206,546		—		1,288,112		—		1,288,112
Derivative liabilities	125		112		13		—		125
December 31, 2014
Financial assets
Money market funds	$	10	$	—	$	10	$	—	$	10
Available-for-sale investment securities	550,394		—		550,394		—		550,394
Stock in Federal Home Loan Bank	69,302		—		69,302		—		69,302
Loans receivable, net	4,397,457		—		—		4,578,822		4,578,822
Derivative assets	398		—		398		—		398
Financial liabilities
Deposit liabilities	4,623,415		—		4,623,773		—		4,623,773
Short-term borrowings—other than bank	118,972		—		118,972		—		118,972
Other bank borrowings	290,656		—		298,837		—		298,837
Long-term debt, net—other than bank	1,506,546		—		1,622,736		—		1,622,736
The Utilities’ long-term debt, net (included in amount above)	1,206,546		—		1,313,893		—		1,313,893
Derivative liabilities	114		71		43		—		114

Schedule of assets measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis were as follows:



	September 30, 2015						December 31, 2014
	Fair value measurements using						Fair value measurements using
(in thousands)	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Money market funds (“other” segment)	$	—	$	10	$	—	$	—	$	10	$	—
Available-for-sale investment securities (bank segment)
Mortgage-related securities-FNMA, FHLMC and GNMA	$	—	$	574,719	$	—	$	—	$	430,834	$	—
U.S. Treasury and federal agency obligations	—		211,118		—		—		119,560		—
	$	—	$	785,837	$	—	$	—	$	550,394	$	—
Derivative assets ¹
Interest rate lock commitments	$	—	$	585	$	—	$	—	$	393	$	—
Forward commitments	—		1		—		—		5		—
	$	—	$	586	$	—	$	—	$	398	$	—
Derivative liabilities ¹
Interest rate lock commitments	$	—	$	—	$	—	$	—	$	3	$	—
Forward commitments	112		13		—		71		40		—
	$	112	$	13	$	—	$	71	$	43	$	—

¹ Derivatives are carried at fair value with changes in value reflected in the balance sheet in other assets or other liabilities and included in mortgage banking income.

Schedule of assets measured at fair value on a nonrecurring basis

Assets measured at fair value on a nonrecurring basis were as follows:



			Fair value measurements
(in thousands)	Balance		Level 1		Level 2		Level 3
September 30, 2015
Loans	$	951	$	—	$	—	$	951
Real estate acquired in settlement of loans	70		—		—		70
December 31, 2014
Loans	2,445		—		—		2,445
Real estate acquired in settlement of loans	288		—		—		288

Schedule of significant unobservable inputs used in the fair value measurement

Key assumptions used in estimating the fair value of the bank’s mortgage servicing rights were as follows:



(dollars in thousands)	September 30, 2015			December 31, 2014
Unpaid principal balance	$	1,503,369		$	1,391,030
Weighted average note rate	4.01		%	4.07		%
Weighted average discount rate	9.5		%	9.6		%
Weighted average prepayment speed	9.9		%	9.5		%

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis:



					Significant unobservable input value ¹
($ in thousands)	Fair value		Valuation technique	Significant unobservable input	Range	Weighted Average
September 30, 2015
Residential loans	$	823	Fair value of property or collateral	Appraised value less 7% selling costs	31-91%	70%
Home equity lines of credit	128		Fair value of property or collateral	Appraised value less 7% selling costs		52%
Total loans	$	951
Real estate acquired in settlement of loans	$	70	Fair value of property or collateral	Appraised value less 7% selling costs	100%	100%

December 31, 2014
Residential loans	$	2,297	Fair value of property or collateral	Appraised value less 7% selling costs	39-99%	83%
Home equity lines of credit	3		Fair value of property or collateral	Appraised value less 7% selling costs		7%
Commercial loans	145		Fair value of property or collateral	Fair value of business assets		91%
Total loans	$	2,445
Real estate acquired in settlement of loans	$	288	Fair value of property or collateral	Appraised value less 7% selling cost	100%	100%

¹ Represent percent of outstanding principal balance.