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Fair Values of Financial Instruments

3 Months Ended

Mar. 31, 2022

Fair Values of Financial Instruments

Fair Values of Financial Instruments

Note 13 – Fair Values 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. March 31, 2022 and December 31, 2021, 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 carrying amount and estimated fair values of financial instruments were as follows:


		March 31, 2022
		Carrying			Fair
		Amount			Value			Level 1			Level 2			Level 3
Financial assets:
Cash and due from banks		$	41,511		$	41,511		$	41,511		$	-		$	-
Interest earning deposits with financial institutions			593,166			593,166			593,166			-			-
Securities available-for-sale			1,816,450			1,692,488			220,563			1,582,054			13,833
FHLBC and FRBC stock			21,974			21,974			-			21,974			-
Loans held-for-sale			8,075			8,075			-			8,075			-
Net loans			3,358,062			3,386,123			-			-			3,386,123
Mortgage servicing rights			10,376			10,376			-			-			10,376
Interest rate swap agreements			952			952			-			952			-
Interest rate lock commitments and forward contracts			930			930			-			930			-
Interest receivable on securities and loans			14,910			14,910			-			14,910			-

Financial liabilities:
Noninterest bearing deposits		$	1,461,712		$	1,461,712		$	1,461,712		$	-		$	-
Interest bearing deposits			4,083,013			4,083,279			-			4,083,279			-
Securities sold under repurchase agreements			33,521			33,521			-			33,521			-
Junior subordinated debentures			25,773			23,711			-			23,711			-
Subordinated debentures			59,233			56,233						56,233
Senior notes			44,506			44,466			44,466			-			-
Note payable and other borrowings			17,992			18,034			-			18,034			-
Interest rate swap agreements			3,657			3,657			-			3,657			-
Interest payable on deposits and borrowings			1,854			1,854			-			1,854			-


		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			-