Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

v3.3.0.814
Fair Value Measurements (Tables)
9 Months Ended
Sep. 30, 2015
Fair Value Disclosures [Abstract]  
Assets and Liabilities Measured at Fair Value on Recurring Basis
As of September 30, 2015 and December 31, 2014, assets and liabilities measured at fair value on a recurring basis are as follows:
 
Level 1
 
Level 2
 
Level 3
 
 
 
Quoted Prices in
Active Markets
for Identical
Assets
 
Significant
Observable
Inputs with No
Active Market
with Identical
Characteristics
 
Significant
Unobservable
Inputs
 
Balance
 
(in thousands)
September 30, 2015
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
Securities available for sale:
 
 
 
 
 
 
 
Mortgage-backed securities
$
—

 
$
324,504

 
$
—

 
$
324,504

Collateralized mortgage obligations
—

 
116,314

 
—

 
116,314

U.S. government agency securities
—

 
57,674

 
—

 
57,674

SBA loan pools securities
—

 
68,301

 
—

 
68,301

Municipal bonds-tax exempt
—

 
48,001

 
—

 
48,001

Municipal bonds-taxable
—

 
14,372

 
—

 
14,372

Corporate bonds
—

 
17,005

 
—

 
17,005

U.S. treasury securities
162

 
—

 
—

 
162

Other securities
23,007

 
—

 
—

 
23,007

Total securities available for sale
$
23,169

 
$
646,171

 
$
—

 
$
669,340

December 31, 2014
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
Securities available for sale:
 
 
 
 
 
 
 
Mortgage-backed securities
$
—

 
$
573,286

 
$
—

 
$
573,286

Collateralized mortgage obligations
—

 
188,047

 
—

 
188,047

U.S. government agency securities (1)
—

 
128,207

 
—

 
128,207

SBA loan pools securities
—

 
109,447

 
—

 
109,447

Municipal bonds-tax exempt
—

 
3,681

 
709

 
4,390

Municipal bonds-taxable
—

 
16,922

 
—

 
16,922

Corporate bonds
—

 
16,948

 
—

 
16,948

U.S. treasury securities
163

 
—

 
—

 
163

Other securities (2)
22,893

 
—

 
—

 
22,893

Equity securities
—

 
—

 
414

 
414

Total securities available for sale
$
23,056

 
$
1,036,538

 
$
1,123

 
$
1,060,717

 
(1) 
U.S. government agency securities of $128.2 million were reclassified as level 2 rather than level 1 as originally classified due to significant other observable inputs other than quoted prices for identical assets in active markets.
(2) 
Other securities of $22.9 million were reclassified as level 1 rather than level 2 as originally classified due to the availability of quoted prices in active markets of the holdings.

Reconciliation and Income Statement Classification of Gains and Losses for All Assets and Liabilities
The table below presents a reconciliation and income statement classification of gains and losses for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended September 30, 2015:
 
Beginning Balance as of January 1, 2015
 
Purchases,
Issuances
and
Settlement
 
Realized
Gains or
(Losses)
in Earnings
 
Unrealized
Gains or
Losses
in Other
Comprehensive
Income
 
Ending Balance as of September 30, 2015
 
(in thousands)
Assets:
 
 
 
 
 
 
 
 
 
Municipal bonds-tax exempt (1)
$
709

 
$
(709
)
 
$
—

 
$
—

 
$
—

Equity securities (2)
$
414

 
$
(339
)
 
$
(75
)
 
$
—

 
$
—

 
(1) 
A zero coupon tax credit municipal bond matured during the first quarter of 2015.
(2) 
Reflects two equity securities that were not actively traded. During the second quarter of 2015, one equity security with a book value of $200,000 with a fair value of $200,000 as of December 31, 2014 was sold at $75,000 loss and the other equity security with a book value of $250,000 with a fair value of $214,000 as of December 31, 2014 was reclassified to other assets.
Assets and Liabilities Measured at Fair Value on Non-Recurring Basis
As of September 30, 2015 and December 31, 2014, assets and liabilities measured at fair value on a non-recurring basis are as follows:
 
Level 1
 
Level 2
 
Level 3
 
 
 
Quoted Prices in
Active Markets
for Identical
Assets
 
Significant
Observable
Inputs With No
Active Market
With Identical
Characteristics
 
Significant
Unobservable
Inputs
 
Loss During the nine Months Ended September 30, 2015
 
(in thousands)
September 30, 2015
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
Impaired loans (excluding PCI loans) (1)
$
—

 
$
24,794

 
$
1,202

 
$
1,985

OREO (2)
$
—

 
$
13,249

 
$
—

 
$
444

 
Level 1
 
Level 2
 
Level 3
 
 
 
Quoted Prices in
Active Markets
for Identical
Assets
 
Significant
Observable
Inputs With No
Active Market
With Identical
Characteristics
 
Significant
Unobservable
Inputs
 
Loss During the Twelve Months Ended December 31, 2014
 
(in thousands)
December 31, 2014
 
 
 
Assets:
 
 
 
 
 
 
 
Impaired loans (excluding PCI loans) (3)
$
—

 
$
32,171

 
$
781

 
$
2,774

OREO (4)
$
—

 
$
15,790

 
$
—

 
$
—

 
(1) 
Consists of real estate loans of $23.4 million, commercial and industrial loans of $896,000, and consumer loans of $1.7 million.
(2) 
Consists of properties obtained from the foreclosure of commercial property loans of $11.5 million and residential property loans of $1.7 million.
(3) 
Consists of real estate loans of $30.0 million, commercial and industrial loans of $1.2 million and consumer loans of $1.7 million.
(4) 
Consists of properties obtained from the foreclosure of commercial property loans of $13.2 million and residential property loans of $2.6 million.
Estimated Fair Values of Financial Instruments
The estimated fair values of financial instruments were as follows:
 
September 30, 2015
 
Carrying
 
Fair Value
 
Amount
 
Level 1
 
Level 2
 
Level 3
 
(in thousands)
Financial assets:
 
 
 
 
 
 
 
Cash and due from banks
$
235,342

 
$
235,342

 
$
—

 
$
—

Securities available for sale
669,340

 
23,169

 
646,171

 
—

Loans receivable, net of allowance for loan losses
2,998,712

 
—

 
—

 
3,006,747

Loans held for sale
4,871

 
—

 
4,871

 
—

Accrued interest receivable
8,722

 
8,722

 
—

 
—

Servicing assets
11,986

 
—

 
—

 
11,986

FHLB stock
16,385

 
—

 
16,385

 
—

FRB stock
14,098

 
—

 
14,098

 
—

Financial liabilities:


 
 
 
 
 
 
Noninterest-bearing deposits
1,114,621

 
—

 
1,114,621

 
—

Interest-bearing deposits
2,404,073

 
—

 
—

 
2,404,110

Servicing liabilities
5,176

 
—

 
—

 
5,176

Borrowings
168,669

 
—

 
—

 
168,669

Accrued interest payable
2,985

 
2,985

 
—

 
—

Off-balance sheet items:


 
 
 
 
 
 
Commitments to extend credit
314,303

 
—

 
—

 
314,303

Standby letters of credit
5,603

 
—

 
—

 
5,603

 
 
December 31, 2014
 
Carrying
 
Fair Value
 
Amount
 
Level 1
 
Level 2
 
Level 3
 
(in thousands)
Financial assets:
 
 
 
 
 
 
 
Cash and due from banks
$
158,320

 
$
158,320

 
$
—

 
$
—

Securities available for sale (1)
1,060,717

 
23,056

 
1,036,538

 
1,123

Loans receivable, net of allowance for loan losses
2,735,832

 
—

 
—

 
2,738,401

Loans held for sale
5,451

 
—

 
5,451

 
—

Accrued interest receivable
9,749

 
9,749

 
—

 
—

Servicing assets
13,773

 
—

 
—

 
13,773

FHLB stock
17,580

 
—

 
17,580

 
—

FRB stock
12,273

 
—

 
12,273

 
—

Financial liabilities:
 
 
 
 
 
 
 
Noninterest-bearing deposits
1,022,972

 
—

 
1,022,972

 
—

Interest-bearing deposits
2,533,774

 
—

 
—

 
2,528,304

Servicing liabilities
5,971

 
—

 
—

 
5,971

Borrowings
168,544

 
—

 
—

 
149,983

Accrued interest payable
3,450

 
3,450

 
—

 
—

Off-balance sheet items:
 
 
 
 
 
 
 
Commitments to extend credit
309,584

 
—

 
—

 
309,584

Standby letters of credit
8,982

 
—

 
—

 
8,982

 
(1) 
Level 1 and Level 2 previously reported as $128.4 million and $931.2 million, respectively. U.S. government agency securities of $128.2 million were reclassified as Level 2 rather than Level 1 as originally classified due to significant other observable inputs other than quoted prices for identical assets in active markets. Other securities of $22.9 million were reclassified as Level 1 rather than Level 2 as originally classified due to the availability of quoted prices in active markets of the holdings.