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FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Summary of Assets Measured at Fair Value on Recurring Basis

The following table summarizes assets measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020:

			Level 1						Level 2						Level 3						Total Fair Value Measurements
March 31, 2021
Investment securities:
States and political subdivisions			$	—					$	124,611					$	9,062					$	133,673
GSE residential MBSs			—						7,861						—						7,861
GSE residential CMOs			—						40,162						—						40,162
Nonagency CMOs			—						—						16,502						16,502
Asset-backed			—						209,104						—						209,104
Other			388						—						—						388
Loans held for sale			—						11,449						—						11,449
Interest rate swaps			—						390						—						390
Interest rate lock commitments on residential mortgages			—						—						672						672
Totals			$	388					$	393,577					$	26,236					$	420,201
December 31, 2020
Investment securities:
States and political subdivisions			$	—					$	103,591					$	9,079					$	112,670
GSE residential MBSs			—						4,293						—						4,293
GSE residential CMOs			—						58,011						—						58,011
Nonagency CMOs			—						—						16,918						16,918
Private label commercial CMOs			—						56,730						5,506						62,236
Asset-backed			—						211,966						—						211,966
Other			371						—						—						371
Loans held for sale			—						11,734						—						11,734
Interest rate swaps			—						690						—						690
Interest rate lock commitments on residential mortgages			—						—						673						673
Totals			$	371					$	447,015					$	32,176					$	479,562

Level 3 Fair Value Measurement Activity

The following provides details of the Level 3 fair value measurement activity for the periods ended March 31, 2021 and 2020:

Investment securities:

									Three Months Ended March 31,
															2021						2020
Balance, beginning of period															$	31,503					$	24,279
Unrealized gain (loss) included in OCI															(665)						(961)
Principal payments and other															(1,729)						(68)
Sales															(3,545)						—
Balance, end of period															$	25,564					$	23,250

Interest rate lock commitments on residential mortgages:

									Three Months Ended March 31,
															2021						2020
Balance, beginning of period															$	673					$	103
Total gains
Included in earnings															(1)						332
Balance, end of period															$	672					$	435

Summary of Assets Measured at Fair Value on Nonrecurring Basis

The following table summarizes assets measured at fair value on a nonrecurring basis at March 31, 2021 and December 31, 2020:

			Level 1						Level 2						Level 3						Total Fair Value Measurements
March 31, 2021
Impaired Loans
Commercial real estate:
Owner occupied			$	—					$	—					$	824					$	824
Non-owner occupied residential			—						—						33						33
Commercial and industrial			—						—						9						9
Residential mortgage:
First lien			—						—						629						629
Home equity - lines of credit			—						—						85						85
Total impaired loans			$	—					$	—					$	1,580					$	1,580
Mortgage servicing rights			$	—					$	—					$	3,449					$	3,449
December 31, 2020
Impaired Loans
Commercial real estate:
Owner occupied			$	—					$	—					$	846					$	846
Non-owner occupied residential			—						—						36						36
Commercial and industrial			—						—						12						12
Residential mortgage:
First lien			—						—						638						638
Home equity - lines of credit			—						—						89						89
Total impaired loans			$	—					$	—					$	1,621					$	1,621
Mortgage servicing rights			$	—					$	—					$	2,745					$	2,745

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:

Fair Value Estimate

Valuation Techniques

Unobservable Input

Range

March 31, 2021

Impaired loans

$

1,580

Appraisal of collateral

Management adjustments on appraisals for property type and recent activity

5% - 25% discount

- Management adjustments for liquidation expenses

6% - 19% discount

Mortgage servicing rights

$

3,449

Discounted cash flows

Weighted average CPR

14.65%

- Weighted average discount rate

9.05%

December 31, 2020

Impaired loans

$

1,621

Appraisal of collateral

Management adjustments on appraisals for property type and recent activity

5% - 25% discount

- Management adjustments for liquidation expenses

6% - 19% discount

Mortgage servicing rights

$

2,745

Discounted cash flows

Weighted average CPR

18.02%

- Weighted average discount rate

9.56%

Financial Instruments at Estimated Fair Values

The following table presents carrying amounts and estimated fair values of the Company’s financial instruments at March 31, 2021 and December 31, 2020:

			Carrying Amount						Fair Value						Level 1						Level 2						Level 3
March 31, 2021
Financial Assets
Cash and due from banks			$	27,600					$	27,600					$	27,600					$	—					$	—
Interest-bearing deposits with banks			298,645						298,645						298,645						—						—
Restricted investments in bank stocks			10,307						n/a						n/a						n/a						n/a
Investment securities			407,690						407,690						388						381,738						25,564
Loans held for sale			11,449						11,449						—						11,449						—
Loans, net of allowance for loan losses			2,026,054						2,021,322						—						—						2,021,322
Interest rate lock commitments on residential mortgages			672						672						—						—						672
Interest rate swaps			390						390						—						390						—
Accrued interest receivable			9,070						9,070						—						1,810						7,260
Financial Liabilities
Deposits			2,547,089						2,548,974						—						2,548,974						—
Securities sold under agreements to repurchase			22,794						22,794						—						22,794						—
FHLB advances and other			57,942						58,159						—						58,159						—
Subordinated notes			31,918						33,400						—						33,400						—
Interest rate swaps			781						781						—						781						—
Accrued interest payable			683						683						—						683						—
December 31, 2020
Financial Assets
Cash and due from banks			$	26,203					$	26,203					$	26,203					$	—					$	—
Interest-bearing deposits with banks			99,055						99,055						99,055						—						—
Restricted investments in bank stocks			10,563						n/a						n/a						n/a						n/a
Investment securities			466,465						466,465						371						434,591						31,503
Loans held for sale			11,734						11,734						—						11,734						—
Loans, net of allowance for loan losses			1,959,539						1,953,860						—						—						1,953,860
Interest rate lock commitments on residential mortgages			673						673						—						—						673
Interest rate swaps			690						690						—						690						—
Accrued interest receivable			8,927						8,927						—						1,529						7,398
Financial Liabilities
Deposits			2,356,880						2,359,317						—						2,359,317						—
Securities sold under agreements to repurchase			19,466						19,466						—						19,466						—
FHLB advances and other			58,045						58,298						—						58,298						—
Subordinated notes			31,903						31,712						—						31,712						—
Interest rate swaps			1,956						1,956						—						1,956						—
Accrued interest payable			238						238						—						238						—

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- Definition

Tabular disclosure of input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis.

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Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

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Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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