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Fair Value Option and Fair Value Measurements (Tables) | 9 Months Ended
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Sep. 30, 2014
Fair Value Option and Fair Value Measurements |
Schedule of balance of assets and liabilities which are measured at fair value on a recurring basis |
|  | September 30, 2014
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Investment securities available-for-sale |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury |  | $ | 1,532 |  | $ | - |  | $ | - |  | $ | 1,532
U.S. government agencies |  |  | - |  |  | 1,638 |  |  | - |  |  | 1,638
States and political subdivisions |  |  | - |  |  | 13,754 |  |  | 125 |  |  | 13,879
Corporate Bonds |  |  | - |  |  | 30,781 |  |  | - |  |  | 30,781
Collateralized mortgage obligations |  |  | - |  |  | 28,417 |  |  | - |  |  | 28,417
Asset-backed securities |  |  | - |  |  | 109,017 |  |  | 83,781 |  |  | 192,798
Collateralized loan obligations |  |  | - |  |  | 93,198 |  |  | - |  |  | 93,198
Loans held-for-sale |  |  | - |  |  | 3,422 |  |  | - |  |  | 3,422
Mortgage servicing rights |  |  | - |  |  | - |  |  | 5,640 |  |  | 5,640
Other assets (Interest rate swap agreements net of swap credit valuation) |  |  | - |  |  | 42 |  |  | - |  |  | 42
Other assets (Mortgage banking derivatives) |  |  | - |  |  | 266 |  |  | - |  |  | 266
Total |  | $ | 1,532 |  | $ | 280,535 |  | $ | 89,546 |  | $ | 371,613
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Other liabilities (Interest rate swap agreements) |  | $ | - |  | $ | 42 |  | $ | - |  | $ | 42
Total |  | $ | - |  | $ | 42 |  | $ | - |  | $ | 42
|  | December 31, 2013
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Investment securities available-for-sale |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury |  | $ | 1,544 |  | $ | - |  | $ | - |  | $ | 1,544
U.S. government agencies |  |  | - |  |  | 1,672 |  |  | - |  |  | 1,672
States and political subdivisions |  |  | - |  |  | 16,669 |  |  | 125 |  |  | 16,794
Corporate bonds |  |  | - |  |  | 15,102 |  |  | - |  |  | 15,102
Collateralized mortgage obligations |  |  | - |  |  | 63,876 |  |  | - |  |  | 63,876
Asset-backed securities |  |  | - |  |  | 119,066 |  |  | 154,137 |  |  | 273,203
Loans held-for-sale |  |  | - |  |  | 3,822 |  |  | - |  |  | 3,822
Mortgage servicing rights |  |  | - |  |  | - |  |  | 5,807 |  |  | 5,807
Other assets (Interest rate swap agreements net of swap credit valuation) |  |  | - |  |  | 229 |  |  | (6) |  |  | 223
Other assets (Mortgage banking derivatives) |  |  | - |  |  | 315 |  |  | - |  |  | 315
Total |  | $ | 1,544 |  | $ | 220,751 |  | $ | 160,063 |  | $ | 382,358
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Other liabilities (Interest rate swap agreements) |  | $ | - |  | $ | 229 |  | $ | - |  | $ | 229
Total |  | $ | - |  | $ | 229 |  | $ | - |  | $ | 229
Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis |
|  | Nine months ended September 30, 2014
|  | Securities available-for- sale |  |  |  |  |  |
|  |  |  |  |  | States and |  | Mortgage |  | Interest Rate
|  |  |  |  |  | Political |  | Servicing |  | Swap
|  |  | Asset-backed |  | Subdivisons |  | Rights |  | Valuation
Beginning balance January 1, 2014 |  |  | $ | 154,137 |  | $ | 125 |  | $ | 5,807 |  | $ | (6)
Transfers into Level 3 |  |  |  | - |  |  | - |  |  | - |  |  | -
Total gains or losses |  |  |  |  |  |  |  |  |  |  |  |  |
Included in earnings (or changes in net assets) |  |  |  | 3,178 |  |  | - |  |  | (761) |  |  | 6
Included in other comprehensive income |  |  |  | (1,748) |  |  | - |  |  | - |  |  | -
Purchases, issuances, sales, and settlements |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases |  |  |  | 63,704 |  |  | - |  |  | - |  |  | -
Issuances |  |  |  | - |  |  | - |  |  | 594 |  |  | -
Sales |  |  |  | (135,490) |  |  | - |  |  | - |  |  | -
Ending balance September 30, 2014 |  |  | $ | 83,781 |  | $ | 125 |  | $ | 5,640 |  | $ | -
|  | Nine months ended September 30, 2013
|  | Securities available-for- sale |  |  |  |  |  |
|  |  |  |  |  |  | States and |  | Mortgage |  | Interest Rate
|  | Collateralized Debt |  |  |  | Political |  | Servicing |  | Swap
|  | Obligations |  | Asset-backed |  | Subdivisons |  | Rights |  | Valuation
Beginning balance January 1, 2013 |  | $ | 9,957 |  | $ | - |  | $ | 132 |  | $ | 4,116 |  | $ | (47)
Transfers into Level 3 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Transfers out of Level 3 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Total gains or losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Included in earnings (or changes in net assets) |  |  | 178 |  |  | 485 |  |  | - |  |  | 81 |  |  | 34
Included in other comprehensive income |  |  | 1,898 |  |  | (1,487) |  |  | - |  |  | - |  |  | -
Purchases, issuances, sales, and settlements |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases |  |  | - |  |  | 168,753 |  |  | - |  |  | - |  |  | -
Issuances |  |  | - |  |  | - |  |  | - |  |  | 1,259 |  |  | -
Settlements |  |  | (946) |  |  | - |  |  | - |  |  | - |  |  | -
Sales |  |  | - |  |  | (20,539) |  |  | - |  |  | - |  |  | -
Ending balance September 30, 2013 |  | $ | 11,087 |  | $ | 147,212 |  | $ | 132 |  | $ | 5,456 |  | $ | (13)
Schedule of quantitative information about level 3 fair value measurements | The following table and commentary presents quantitative (dollars in thousands) and qualitative information about Level 3 fair value measurements as of September 30, 2014:
|  |  |  |  |  |  |  |  |  |  | Weighted
Measured at fair value |  |  |  |  |  |  | Unobservable |  |  |  | Average
on a recurring basis: |  | Fair Value |  | Valuation Methodology |  | Inputs |  | Range of Input |  | of Inputs
Mortgage Servicing rights |  |  | 5,640 |  | Discounted Cash Flow |  | Discount Rate |  | 10.0-30.75% |  | 10.3 | %
|  |  |  |  |  |  | Prepayment Speed |  | 3.97-77.99% |  | 9.5 | %
Asset-backed securities |  |  | 83,781 |  | Discounted Cash Flow |  | Credit Risk Premium |  | 0.8-1.2% |  | 1.0 | %
|  |  |  |  | with comparable transaction yields |  | Liquidity Discount |  | 4.0-4.3% |  | 4.2 | %
The following table and commentary presents quantitative (dollars in thousands) and qualitative information about Level 3 fair value measurements as of December 31, 2013:
|  |  |  |  |  |  |  |  |  |  | Weighted
Measured at fair value |  |  |  |  |  |  | Unobservable |  |  |  | Average
on a recurring basis: |  | Fair Value |  | Valuation Methodology |  | Inputs |  | Range of Input |  | of Inputs
Mortgage Servicing rights |  |  | 5,807 |  | Discounted Cash Flow |  | Discount Rate |  | 10.2% |  | 10.2 | %
|  |  |  |  |  |  | Prepayment Speed |  | 9.7% |  | 9.7 | %
Interest Rate Swap Valuation |  |  | (6) |  | Management estimate of |  | Probability of Default |  | 5.0-20% |  | 12.5 | %
|  |  |  |  | credit risk exposure |  |  |  |  |  |  |
Asset-backed securities |  |  | 154,137 |  | Discounted Cash Flow |  | Credit Risk Premium |  | 1.1-1.5% |  | 1.2 | %
|  |  |  |  | with comparable transaction yields |  | Liquidity Discount |  | 4.5-5.1% |  | 4.9 | %
Schedule of assets and liabilities measured at fair value on a nonrecurring basis |
|  | September 30, 2014
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Impaired loans 1 |  | $ | - |  | $ | - |  | $ | 957 |  | $ | 957
Other real estate owned, net 2 |  |  | - |  |  | - |  |  | 40,877 |  |  | 40,877
Total |  | $ | - |  | $ | - |  | $ | 41,834 |  | $ | 41,834
1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans, had a carrying amount of $1.5 million, with a valuation allowance of $541,000, resulting in a decrease of specific allocations within the allowance for loan losses of $1.9 million for the nine months ended months ending September 30, 2014. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $40.9 million, which is made up of the outstanding balance of $61.7 million, net of a valuation allowance of $19.0 million and participations of $1.8 million, at September 30, 2014.
|  | December 31, 2013
|  | Level 1 |  | Level 2 |  | Level 3 |  | Total
Impaired loans 1 |  | $ | - |  | $ | - |  | $ | 9,103 |  | $ | 9,103
Other real estate owned, net 2 |  |  | - |  |  | - |  |  | 41,537 |  |  | 41,537
Total |  | $ | - |  | $ | - |  | $ | 50,640 |  | $ | 50,640
1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans, had a carrying amount of $11.5 million, with a valuation allowance of $2.4 million, resulting in a decrease of specific allocations within the provision for loan losses of $3.9 million for the year ending December 31, 2013. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $41.5 million, which is made up of the outstanding balance of $65.9 million, net of a valuation allowance of $22.3 million and participations of $2.1 million, at December 31, 2013.

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- Definition Tabular disclosure of the fair value measurement of assets and liabilities 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, 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, issuances, 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 or liability. + References No definition available. + Details
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- Definition Tabular disclosure of the inputs and valuation techniques used to measure fair value, and a discussion of changes in valuation techniques and related inputs, if any, applied during the period to each separate class of assets, liabilities, and financial instruments classified in shareholders' equity that are measured on a recurring and/or nonrecurring basis. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (bbb) -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 + Details
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- Definition Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19296-110258 + Details
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- Definition Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19190-110258 + Details
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