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Fair Value (Tables)
 6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]  
Schedule of assets and liabilities measured at fair value
The fair value of derivatives is based on valuation models using observable market data as of the measurement date (Level 2 inputs).
 
 
June 30, 2019
 
 
Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)
(Dollar amounts in thousands)
 
Level 1
 
Level 2
 
Level 3
 
Total
U.S. Government agencies
 
$
—

 
$
33,524

 
$
—

 
$
33,524

Mortgage Backed Securities-residential
 
—

 
188,769

 
—

 
188,769

Collateralized mortgage obligations
 
—

 
321,317

 
—

 
321,317

State and municipal
 
—

 
241,704

 
2,890

 
244,594

Collateralized debt obligations
 
—

 
—

 
3,333

 
3,333

TOTAL
 
$
—

 
$
785,314

 
$
6,223

 
$
791,537

Derivative Assets
 
 

 
690

 
 

 
 

Derivative Liabilities
 
 

 
(690
)
 
 

 
 

 
 
December 31, 2018
 
 
Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)
(Dollar amounts in thousands)
 
Level 1
 
Level 2
 
Level 3
 
Total
U.S. Government agencies
 
$
—

 
$
25,364

 
$
—

 
$
25,364

Mortgage Backed Securities-residential
 
—

 
178,743

 
—

 
178,743

Mortgage Backed Securities-commercial
 
—

 
—

 
—

 
—

Collateralized mortgage obligations
 
—

 
343,616

 
—

 
343,616

State and municipal
 
—

 
230,800

 
3,135

 
233,935

Collateralized debt obligations
 
—

 
—

 
3,258

 
3,258

TOTAL
 
$
—

 
$
778,523

 
$
6,393

 
$
784,916

Derivative Assets
 
 

 
218

 
 

 
 

Derivative Liabilities
 
 

 
(218
)
 
 

 
 
Roll forward of financial instruments having fair value measurements using significant unobservable inputs (Level 3)
The tables below presents a reconciliation and income statement classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2019 and the year ended December 31, 2018. 
 
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
 
Three Months Ended June 30, 2019
(Dollar amounts in thousands)
State and
municipal
obligations
 
Collateralized
debt
obligations
 
Total
Beginning balance, April 1
$
2,890

 
$
3,294

 
$
6,184

Total realized/unrealized gains or losses
 

 
 

 
 

Included in earnings
—

 
—

 
—

Included in other comprehensive income
—

 
84

 
84

Transfers
—

 
—

 
—

Settlements
—

 
(45
)
 
(45
)
Ending balance, June 30
$
2,890

 
$
3,333

 
$
6,223

 
 
 
Six Months Ended June 30, 2019
(Dollar amounts in thousands)
State and
municipal
obligations
 
Collateralized
debt
obligations
 
Total
Beginning balance, January 1
$
3,135

 
$
3,258

 
$
6,393

Total realized/unrealized gains or losses
 

 
 

 
 

Included in earnings
—

 
—

 
—

Included in other comprehensive income
—

 
161

 
161

Transfers
—

 
—

 
—

Settlements
(245
)
 
(86
)
 
(331
)
Ending balance, June 30
$
2,890

 
$
3,333

 
$
6,223

 
 
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
 
 
Year Ended December 31, 2018
(Dollar amounts in thousands)
 
State and
municipal
obligations
 
Collateralized
debt
obligations
 
Total
Beginning balance, January 1
 
$
3,680

 
$
14,605

 
$
18,285

Total realized/unrealized gains or losses
 
 

 
 

 
 

Included in earnings
 
—

 
—

 
—

Included in other comprehensive income
 
—

 
(2,840
)
 
(2,840
)
Purchases
 
—

 
—

 
—

Settlements
 
(545
)
 
(8,507
)
 
(9,052
)
Ending balance, December 31
 
$
3,135

 
$
3,258

 
$
6,393
Quantitative information about recurring and non-recurring Level 3
The following table presents quantitative information about recurring and non-recurring Level 3 fair value measurements at June 30, 2019.
(Dollar amounts in thousands)
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range
State and municipal obligations
 
$
2,890

 
Discounted cash flow
 
Discount rate
Probability of default
 
2.87%-4.44% 0%
Other real estate  
 
$
498

 
Sales comparison/income approach
 
Discount rate for age of appraisal and market conditions
 
5.00%-20.00%
Impaired Loans
 
$
1,033

 
Sales comparison/income approach
 
Discount rate for age of appraisal and market conditions
 
0.00%-50.00%

The following table presents quantitative information about recurring and non-recurring Level 3 fair value measurements at December 31, 2018.
(Dollar amounts in thousands)
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range
State and municipal obligations
 
$
3,135

 
Discounted cash flow
 
Discount rate
Probability of default
 
2.64%-4.80% 0%
Other real estate  
 
$
603

 
Sales comparison/income approach
 
Discount rate for age of appraisal and market conditions
 
5.00%-20.00%
Impaired Loans
 
1,639

 
Sales comparison/income approach
 
Discount rate for age of appraisal and market conditions
 
0.00%-50.00%
Schedule of loans identified as impaired by class of loans
The following tables presents loans identified as impaired by class of loans, and carried at fair value on a non-recurring basis, as of June 30, 2019 and December 31, 2018, which are all considered Level 3.
 
 
June 30, 2019
(Dollar amounts in thousands)
 
Carrying
Value
 
Allowance
for Loan
Losses
Allocated
 
Fair Value
Commercial
 
 

 
 

 
 

Commercial & Industrial
 
$
1,691

 
$
658

 
$
1,033

Farmland
 
—

 
—

 
—

Non Farm, Non Residential
 
—

 
—

 
—

Agriculture
 
—

 
—

 
—

All Other Commercial
 
—

 
—

 
—

Residential
 
 

 
 

 
 

First Liens
 
—

 
—

 
—

Home Equity
 
—

 
—

 
—

Junior Liens
 
—

 
—

 
—

Multifamily
 
—

 
—

 
—

All Other Residential
 
—

 
—

 
—

Consumer
 
 

 
 

 
 

Motor Vehicle
 
—

 
—

 
—

All Other Consumer
 
—

 
—

 
—

TOTAL
 
$
1,691

 
$
658

 
$
1,033

 
 
December 31, 2018
(Dollar amounts in thousands)
 
Carrying
Value
 
Allowance
for Loan
Losses
Allocated
 
Fair Value
Commercial
 
 

 
 

 
 

Commercial & Industrial
 
$
1,819

 
$
593

 
$
1,226

Farmland
 
211

 
44

 
167

Non Farm, Non Residential
 
—

 
—

 
—

Agriculture
 
346

 
100

 
246

All Other Commercial
 
—

 
—

 
—

Residential
 
 

 
 

 
 

First Liens
 
—

 
—

 
—

Home Equity
 
—

 
—

 
—

Junior Liens
 
—

 
—

 
—

Multifamily
 
—

 
—

 
—

All Other Residential
 
—

 
—

 
—

Consumer
 
 

 
 

 
 

Motor Vehicle
 
—

 
—

 
—

All Other Consumer
 
—

 
—

 
—

TOTAL
 
$
2,376

 
$
737

 
$
1,639
Schedule of carrying amount and estimated fair value of financial instruments
The fair value of off-balance sheet items is not considered material.
 
 
June 30, 2019
 
 
Carrying
 
Fair Value
(Dollar amounts in thousands)
 
Value
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and due from banks
 
$
60,884

 
$
19,616

 
$
41,268

 
$
—

 
$
60,884

Federal funds sold
 
2,200

 
—

 
2,200

 
—

 
2,200

Securities available-for-sale
 
791,537

 
—

 
785,314

 
6,223

 
791,537

Restricted stock
 
10,412

 
n/a

 
n/a

 
n/a

 
n/a

Loans, net
 
1,989,948

 
—

 
—

 
1,996,751

 
1,996,751

Accrued interest receivable
 
13,877

 
—

 
3,919

 
9,958

 
13,877

Deposits
 
(2,463,018
)
 
—

 
(2,458,072
)
 
—

 
(2,458,072
)
Short-term borrowings
 
(60,492
)
 
—

 
(60,492
)
 
—

 
(60,492
)
Accrued interest payable
 
(687
)
 
—

 
(687
)
 
—

 
(687
)
 
 
December 31, 2018
 
 
Carrying
 
Fair Value
(Dollar amounts in thousands)
 
Value
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and due from banks
 
$
74,388

 
$
23,418

 
$
50,970

 
$
—

 
$
74,388

Securities available-for-sale
 
784,916

 
—

 
778,523

 
6,393

 
784,916

Restricted stock
 
10,390

 
n/a

 
n/a

 
n/a

 
n/a

Loans, net
 
1,933,552

 
—

 
—

 
1,889,795

 
1,889,795

Accrued interest receivable
 
13,970

 
—

 
3,005

 
10,965

 
13,970

Deposits
 
(2,436,727
)
 
—

 
(2,426,128
)
 
—

 
(2,426,128
)
Short-term borrowings
 
(69,656
)
 
—

 
(69,656
)
 
—

 
(69,656
)
Accrued interest payable
 
(609
)
 
—

 
(609
)
 
—

 
(609
)