FAIR VALUE DISCLOSURES (Tables)

6 Months Ended

Jun. 30, 2016

Summary of Assets Measured at Estimated Fair Value on Recurring Basis

A summary of assets at June 30, 2016 and December 31, 2015, measured at estimated fair value on a recurring basis was as follows:



(Dollars in Thousands)	Level 1		Level 2		Level 3		Total Fair Value Measurements
June 30, 2016
Securities available for sale:
U.S. Government Agencies	$	0	$	43,394	$	0	$	43,394
States and political subdivisions	0		132,183		0		132,183
U.S. Government Sponsored enterprises (GSE) residential mortgage-backed securities	0		128,875		0		128,875
GSE residential collateralized mortgage obligations (CMOs)	0		12,737		0		12,737
Private label CMOs	0		7,276		0		7,276
Total debt securities	0		324,465		0		324,465
Equity securities - financial services	0		75		0		75
Total securities	$	0	$	324,540	$	0	$	324,540

December 31, 2015
Securities available for sale:
U.S. Government Agencies	$	0	$	47,227	$	0	$	47,227
States and political subdivisions	0		125,961		0		125,961
GSE residential mortgage-backed securities	0		132,349		0		132,349
GSE residential collateralized mortgage obligations (CMOs)	0		15,843		0		15,843
GSE commercial CMOs	0		63,770		0		63,770
Private label CMOs	0		8,901		0		8,901
Total debt securities	0		394,051		0		394,051
Equity securities - financial services	0		73		0		73
Total securities	$	0	$	394,124	$	0	$	394,124

Summary of Additional Qualitative Information

The following table presents additional qualitative information about assets measured on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value:



(Dollars in thousands)	Fair Value Estimate		Valuation Techniques	Unobservable Input	Range
June 30, 2016
Impaired loans	$	4,427	Appraisal of collateral	Management adjustments on appraisals for property type and recent activity	0% - 68% discount
				Management adjustments for liquidation expenses	0% - 45% discount
Foreclosed real estate	204		Appraisal of collateral	Management adjustments on appraisals for property type and recent activity	25% - 53% discount
				Management adjustments for liquidation expenses	7% - 8% discount
December 31, 2015
Impaired loans	$	4,757	Appraisal of collateral	Management adjustments on appraisals for property type and recent activity	0% - 70% discount
				Management adjustments for liquidation expenses	6% - 44% discount
Foreclosed real estate	175		Appraisal of collateral	Management adjustments on appraisals for property type and recent activity	10% - 20% discount
				Management adjustments for liquidation expenses	5% - 6% discount

Summary of Assets Measured at Fair Value on Nonrecurring Basis

A summary of assets at June 30, 2016 and December 31, 2015, measured at estimated fair value on a nonrecurring basis was as follows:



(Dollars in thousands)	Level 1		Level 2		Level 3		Total Fair Value Measurements
June 30, 2016
Impaired Loans
Commercial real estate:
Owner-occupied	$	0	$	0	$	942	$	942
Non-owner occupied	0		0		736		736
Multi-family	0		0		216		216
Non-owner occupied residential	0		0		442		442
Acquisition and development:
Commercial and land development	0		0		2		2
Residential mortgage:
First lien	0		0		1,928		1,928
Home equity - lines of credit	0		0		153		153
Installment and other loans	0		0		8		8
Impaired loans, net	$	0	$	0	$	4,427	$	4,427

Foreclosed real estate
Residential	$	0	$	0	$	173	$	173
Commercial and land development	0		0		31		31
Total foreclosed real estate	$	0	$	0	$	204	$	204
December 31, 2015
Impaired Loans
Commercial real estate:
Owner-occupied	$	0	$	0	$	881	$	881
Non-owner occupied	0		0		736		736
Multi-family	0		0		233		233
Non-owner occupied residential	0		0		570		570
Acquisition and development:
Commercial and land development	0		0		5		5
Residential mortgage:
First lien	0		0		2,094		2,094
Home equity - lines of credit	0		0		229		229
Installment and other loans	0		0		9		9
Impaired loans, net	$	0	$	0	$	4,757	$	4,757

Foreclosed real estate
Residential	$	0	$	0	$	101	$	101
Commercial and land development	0		0		74		74
Total foreclosed real estate	$	0	$	0	$	175	$	175

Financial Instruments at Estimated Fair Values

The estimated fair values of the Company’s financial instruments were as follows at June 30, 2016 and December 31, 2015:



(Dollars in thousands)	Carrying Amount		Fair Value		Level 1		Level 2		Level 3
June 30, 2016
Financial Assets
Cash and due from banks	$	12,940	$	12,940	$	12,940	$	0	$	0
Interest bearing deposits with banks	50,709		50,709		50,709		0		0
Restricted investments in bank stocks	5,780		n/a		n/a		n/a		n/a
Securities available for sale	324,540		324,540		0		324,540		0
Loans held for sale	6,627		6,808		0		6,808		0
Loans, net of allowance for loan losses	818,493		837,477		0		0		837,477
Accrued interest receivable	3,759		3,759		0		2,087		1,672
Financial Liabilities
Deposits	1,087,969		1,096,309		0		1,096,309		0
Short-term borrowings	43,393		43,393		0		43,393		0
Long-term debt	24,331		25,282		0		25,282		0
Accrued interest payable	378		378		0		378		0
Off-balance sheet instruments	0		0		0		0		0
December 31, 2015
Financial Assets
Cash and due from banks	$	11,412	$	11,412	$	11,412	$	0	$	0
Interest bearing deposits with banks	16,928		16,928		16,928		0		0
Restricted investments in bank stocks	8,720		n/a		n/a		n/a		n/a
Securities available for sale	394,124		394,124		0		394,124		0
Loans held for sale	5,917		6,045		0		6,045		0
Loans, net of allowance for loan losses	768,145		776,067		0		0		776,067
Accrued interest receivable	3,845		3,845		0		2,257		1,588
Financial Liabilities
Deposits	1,032,167		1,032,265		0		1,032,265		0
Short-term borrowings	89,156		89,156		0		89,156		0
Long-term debt	24,495		25,357		0		25,357		0
Accrued interest payable	366		366		0		366		0
Off-balance sheet instruments	0		0		0		0		0