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Fair Values of Financial Instruments

12 Months Ended

Dec. 31, 2021

Fair Values of Financial Instruments

Fair Values of Financial Instruments

Note 18: 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, 2021 and 2020, 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 16: Mortgage Banking Derivatives, above.

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


		December 31, 2021
		Carrying			Fair
		Amount			Value			Level 1			Level 2			Level 3
Financial assets:
Cash and due from banks		$	38,565		$	38,565		$	38,565		$	-		$	-
Interest earning deposits with financial institutions			713,542			713,542			713,542			-			-
Securities available-for-sale			1,692,488			1,692,488			202,339			1,476,057			14,092
FHLBC and FRBC stock			13,257			13,257			-			13,257			-
Loans held-for-sale			4,737			4,737			-			4,737			-
Net loans			3,377,667			3,408,199			-			-			3,408,199
Mortgage servicing rights			7,097			7,097			-			-			7,097
Interest rate swap agreements			3,494			3,494			-			3,494			-
Interest rate lock commitments and forward contracts			508			508			-			508			-
Interest receivable on securities and loans			13,431			13,431			-			13,431			-

Financial liabilities:
Noninterest bearing deposits		$	1,428,055		$	1,428,055		$	1,428,055		$	-		$	-
Interest bearing deposits			4,038,177			4,041,369			-			4,041,369			-
Securities sold under repurchase agreements			50,377			50,377			-			50,377			-
Junior subordinated debentures			25,773			18,557			-			18,557			-
Subordinated debentures			59,212			60,111						60,111
Senior notes			44,480			44,480			44,480			-			-
Note payable and other borrowings			19,074			19,411			-			19,411			-
Interest rate swap agreements			6,788			6,788			-			6,788			-
Interest payable on deposits and borrowings			1,706			1,706			-			1,706			-


		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
Mortgage servicing rights			4,224			4,224			-			-			4,224
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			-
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			-