Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

v3.22.1
Fair Value Measurements (Tables)
3 Months Ended
Mar. 31, 2022
Fair Value Disclosures [Abstract]  
Assets and Liabilities Measured at Fair Value on Recurring Basis

As of March 31, 2022 and December 31, 2021, assets and liabilities measured at fair value on a recurring basis are as follows:

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

 

 

 

 

 

 

 

 

Significant

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Observable

 

 

 

 

 

 

 

 

 

 

 

Quoted Prices in

 

 

Inputs with No

 

 

 

 

 

 

 

 

 

 

 

Active Markets

 

 

Active Market

 

 

Significant

 

 

 

 

 

 

 

for Identical

 

 

with Identical

 

 

Unobservable

 

 

 

 

 

 

 

Assets

 

 

Characteristics

 

 

Inputs

 

 

Total Fair Value

 

 

 

(in thousands)

 

March 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

18,214

 

 

$

 

 

$

 

 

$

18,214

 

U.S. government agency and sponsored agency obligations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

 

 

 

 

576,876

 

 

 

 

 

 

576,876

 

Collateralized mortgage obligations

 

 

 

 

 

87,164

 

 

 

 

 

 

87,164

 

Debt securities

 

 

 

 

 

124,624

 

 

 

 

 

 

124,624

 

Total U.S. government agency and sponsored agency obligations

 

 

 

 

 

788,664

 

 

 

 

 

 

788,664

 

Municipal bonds-tax exempt

 

 

 

 

 

70,102

 

 

 

 

 

 

70,102

 

Total securities available for sale

 

$

18,214

 

 

$

858,766

 

 

$

 

 

$

876,980

 

Derivative financial instruments

 

$

 

 

$

4,468

 

 

$

 

 

$

4,468

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

 

$

 

 

$

4,395

 

 

$

 

 

$

4,395

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities available for sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

15,397

 

 

$

 

 

$

 

 

$

15,397

 

U.S. government agency and sponsored agency obligations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

 

 

 

 

607,505

 

 

 

 

 

 

607,505

 

Collateralized mortgage obligations

 

 

 

 

 

93,604

 

 

 

 

 

 

93,604

 

Debt securities

 

 

 

 

 

115,896

 

 

 

 

 

 

115,896

 

Total U.S. government agency and sponsored agency obligations

 

 

 

 

 

817,005

 

 

 

 

 

 

817,005

 

Municipal bonds-tax exempt

 

 

 

 

 

78,388

 

 

 

 

 

 

78,388

 

Total securities available for sale

 

$

15,397

 

 

$

895,393

 

 

$

 

 

$

910,790

 

Derivative financial instruments

 

$

 

 

$

1,379

 

 

$

 

 

$

1,379

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

 

$

 

 

$

1,360

 

 

$

 

 

$

1,360

 

Assets and Liabilities Measured at Fair Value on Non-Recurring Basis

As of March 31, 2022 and December 31, 2021, assets and liabilities measured at fair value on a non-recurring basis are as follows:

 

 

 

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

 

 

 

 

 

 

 

 

Significant

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Observable

 

 

 

 

 

 

 

 

 

 

 

Quoted Prices in

 

 

Inputs With No

 

 

 

 

 

 

 

 

 

 

 

Active Markets

 

 

Active Market

 

 

Significant

 

 

 

 

 

 

 

for Identical

 

 

With Identical

 

 

Unobservable

 

 

 

Total

 

 

Assets

 

 

Characteristics

 

 

Inputs

 

 

 

(in thousands)

 

March 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collateral dependent loans (1)

 

$

3,141

 

 

$

 

 

$

 

 

$

3,141

 

Other real estate owned

 

 

675

 

 

 

 

 

 

 

 

 

675

 

Repossessed personal property

 

 

25

 

 

 

 

 

 

 

 

 

25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collateral dependent loans (2)

 

$

3,398

 

 

$

 

 

$

 

 

$

3,398

 

Other real estate owned

 

 

675

 

 

 

 

 

 

 

 

 

675

 

Repossessed personal property

 

 

8

 

 

 

 

 

 

 

 

 

8

 

 

(1)

Consisted of real estate loans of $3.1 million.

(2)

Consisted of real estate loans of $3.4 million.

 

Quantitative Information about Level 3 Fair Value Assumptions for Assets Measured at Fair Value on Non-Recurring Basis

The following table represents quantitative information about Level 3 fair value assumptions for assets measured at fair value on a non-recurring basis at March 31, 2022 and December 31, 2021:

 

 

 

Fair Value

 

 

Valuation

Techniques

 

Unobservable

Input(s)

 

Range (Weighted

Average)

 

 

 

(in thousands)

 

March 31, 2022

 

 

 

 

 

 

 

 

 

 

 

Collateral dependent loans:

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

Retail

 

$

1,708

 

 

Market approach

 

Market data comparison

 

(25)% to 27% / 9%

(1)

Other

 

 

482

 

 

Market approach

 

Market data comparison

 

(20)% to 0% / 0%

(1)

Residential/consumer loans

 

 

951

 

 

Market approach

 

Market data comparison

 

(4)% to 10% / 6%

(1)

Total real estate loans

 

 

3,141

 

 

 

 

 

 

 

 

Total

 

$

3,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other real estate owned

 

$

675

 

 

Market approach

 

Market data comparison

 

(10)% to 10% / (3)%

 

 

 

 

 

 

 

 

 

 

 

 

 

Repossessed personal property

 

 

25

 

 

Market approach

 

Market data comparison

 

 

(2)

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

Collateral dependent loans:

 

 

 

 

 

 

 

 

 

 

 

Real estate loans:

 

 

 

 

 

 

 

 

 

 

 

Commercial property

 

 

 

 

 

 

 

 

 

 

 

Retail

 

$

1,917

 

 

Market approach

 

Market data comparison

 

(28)% to 23% / (6)%

(1)

Other

 

 

499

 

 

Market approach

 

Market data comparison

 

(20)% to 20% / 0%

(1)

Residential/consumer loans

 

 

982

 

 

Market approach

 

Market data comparison

 

(19)% to 8% / 3%

(1)

Total real estate loans

 

 

3,398

 

 

 

 

 

 

 

 

Total

 

$

3,398

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other real estate owned

 

$

675

 

 

Market approach

 

Market data comparison

 

(20)% to (5)% / (12)%

 

 

 

 

 

 

 

 

 

 

 

 

 

Repossessed personal property

 

 

8

 

 

Market approach

 

Market data comparison

 

 

(2)

 

(1)

Appraisal reports utilize a combination of valuation techniques including a market approach, where prices and other relevant information generated by market transactions involving similar or comparable properties are used to determine the appraised value. Appraisals may include an ‘as is’ and ‘upon completion’ valuation scenarios. Adjustments are routinely made in the appraisal process by third-party appraisers to adjust for differences between the comparable sales and income data. Adjustments also result from the consideration of relevant economic and demographic factors with the potential to affect property values. Also, prospective values are based on the market conditions which exist at the date of inspection combined with informed forecasts based on current trends in supply and demand for the property types under appraisal. Positive adjustments disclosed in this table represent increases to the sales comparison and negative adjustment represent decreases.

(2)

The equipment is usually too low in value to use a professional appraisal service. The values are determined internally using a combination of auction values, vendor recommendations and sales comparisons depending on the equipment type. Some highly commoditized equipment, such as commercial trucks have services that provide industry values.

Estimated Fair Values of Financial Instruments

The estimated fair values of financial instruments were as follows:

 

 

 

March 31, 2022

 

 

 

Carrying

 

 

Fair Value

 

 

 

Amount

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(in thousands)

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

312,491

 

 

$

312,491

 

 

$

 

 

$

 

Securities available for sale

 

 

876,980

 

 

 

18,214

 

 

 

858,766

 

 

 

 

Loans held for sale

 

 

15,617

 

 

 

 

 

 

16,948

 

 

 

 

Loans receivable, net of allowance for credit losses

 

 

5,265,988

 

 

 

 

 

 

 

 

 

5,208,194

 

Accrued interest receivable

 

 

12,289

 

 

 

12,289

 

 

 

 

 

 

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

2,678,726

 

 

 

 

 

 

2,678,726

 

 

 

 

Interest-bearing deposits

 

 

3,104,444

 

 

 

 

 

 

 

 

 

3,101,440

 

Borrowings and subordinated debentures

 

 

253,967

 

 

 

 

 

 

122,525

 

 

 

129,028

 

Accrued interest payable

 

 

966

 

 

 

966

 

 

 

 

 

 

 

 

 

 

December 31, 2021

 

 

 

Carrying

 

 

Fair Value

 

 

 

Amount

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(in thousands)

 

Financial assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

608,965

 

 

$

608,965

 

 

$

 

 

$

 

Securities available for sale

 

 

910,790

 

 

 

15,397

 

 

 

895,393

 

 

 

 

Loans held for sale

 

 

13,342

 

 

 

 

 

 

14,723

 

 

 

 

Loans receivable, net of allowance for credit losses

 

 

5,078,984

 

 

 

 

 

 

 

 

 

5,072,282

 

Accrued interest receivable

 

 

11,976

 

 

 

11,976

 

 

 

 

 

 

 

Financial liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

2,574,517

 

 

 

 

 

 

2,574,517

 

 

 

 

Interest-bearing deposits

 

 

3,211,752

 

 

 

 

 

 

 

 

 

3,211,708

 

Borrowings and subordinated debentures

 

 

352,506

 

 

 

 

 

 

137,198

 

 

 

213,179

 

Accrued interest payable

 

 

1,161

 

 

 

1,161