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Fair Values of Financial Instruments

12 Months Ended

Dec. 31, 2020

Fair Values of Financial Instruments

Fair Values of Financial Instruments

Note 17: Fair Value of Financial Instruments

The estimated fair values approximate carrying amount for all items except those described in the following table. Securities available-for-sale fair values are based upon market prices or dealer quotes, and if no such information is available, on the rate and term of the security. The carrying value of FHLBC stock approximates fair value as the stock is nonmarketable and can only be sold to the FHLBC or another member institution at par. FHLBC stock is carried at cost and considered a Level 2 fair value. For December 31, 2020 and 2019, the fair values of loans and leases are estimated on an exit price basis incorporating discounts for credit, liquidity and marketability factors. The fair value of time deposits is estimated using discounted future cash flows at current rates offered for deposits of similar remaining maturities. The fair values of borrowings were estimated based on interest rates available to the Company for debt with similar terms and remaining maturities. The fair value of off balance sheet volume is not considered material. The fair value of mortgage banking derivatives is discussed in Note 15: Mortgage Banking Derivatives, above.

The carrying amount and estimated fair values of financial instruments at December 31, were as follows:


		December 31, 2020
		Carrying			Fair
		Amount			Value			Level 1			Level 2			Level 3
Financial assets:
Cash and due from banks		$	24,306		$	24,306		$	24,306		$	-		$	-
Interest earning deposits with financial institutions			305,597			305,597			305,597			-			-
Securities available-for-sale			496,178			496,178			4,117			487,742			4,319
FHLBC and FRBC stock			9,917			9,917			-			9,917			-
Loans held-for-sale			12,611			12,611			-			12,611			-
Net loans			2,000,996			2,009,773			-			-			2,009,773
Interest rate swap agreements			9,388			9,388			-			9,388			-
Interest rate lock commitments and forward contracts			840			840			-			840			-
Interest receivable on securities and loans			9,698			9,698			-			9,698			-

Financial liabilities:
Noninterest bearing deposits		$	909,505		$	909,505		$	909,505		$	-		$	-
Interest bearing deposits			1,627,568			1,630,109			-			1,630,109			-
Securities sold under repurchase agreements			66,980			66,980			-			66,980			-
Other short-term borrowings			-			-			-			-			-
Junior subordinated debentures			25,773			14,658			-			14,658			-
Senior notes			44,375			44,600			44,600			-			-
Note payable and other borrowings			23,393			24,043			-			24,043			-
Interest rate swap agreements			13,071			13,071			-			13,071			-
Interest payable on deposits and borrowings			418			418			-			418			-


		December 31, 2019
		Carrying			Fair
		Amount			Value			Level 1			Level 2			Level 3
Financial assets:
Cash and due from banks		$	34,096		$	34,096		$	34,096		$	-		$	-
Interest earning deposits with financial institutions			16,536			16,536			16,536			-			-
Securities available-for-sale			484,648			484,648			4,036			475,193			5,419
FHLBC and FRBC stock			9,917			9,917			-			9,917			-
Loans held-for-sale			3,061			3,061			-			3,061			-
Net loans			1,911,023			1,915,531			-			-			1,915,531
Interest rate swap agreements			2,771			2,771			-			2,771			-
Interest rate lock commitments and forward contracts			250			250			-			250			-
Interest receivable on securities and loans			9,697			9,697			-			9,697			-

Financial liabilities:
Noninterest bearing deposits		$	669,795		$	669,795		$	669,795		$	-		$	-
Interest bearing deposits			1,456,954			1,457,832			-			1,457,832			-
Securities sold under repurchase agreements			48,693			48,693			-			48,693			-
Other short-term borrowings			48,500			48,500			-			48,500			-
Junior subordinated debentures			57,734			51,188			33,614			17,574			-
Senior notes			44,270			46,269			46,269			-			-
Note payable and other borrowings			6,673			7,003			-			7,003			-
Interest rate swap agreements			5,921			5,921			-			5,921			-
Interest payable on deposits and borrowings			1,079			1,079			-			1,079			-