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FAIR VALUE (Tables)

9 Months Ended

Sep. 30, 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 September 30, 2021 and December 31, 2020:

			Level 1						Level 2						Level 3						Total Fair Value Measurements
September 30, 2021
Financial Assets
Investment securities:
U.S. Treasury securities			$	19,831					$	—					$	—					$	19,831
States and political subdivisions			—						171,304						10,217						181,521
GSE residential MBSs			—						20,518						—						20,518
GSE residential CMOs			—						70,187						—						70,187
Nonagency CMOs			—						12,400						13,257						25,657
Asset-backed			—						126,907						—						126,907
Other			397						—						—						397
Loans held for sale			—						6,412						—						6,412
Derivatives			—						277						546						823
Totals			$	20,228					$	408,005					$	24,020					$	452,253
Financial Liabilities
Derivatives			$	—					$	272					$	—					$	272
December 31, 2020
Financial Assets
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
Derivatives			—						690						673						1,363
Totals			$	371					$	447,015					$	32,176					$	479,562
Financial Liabilities
Derivatives			$	—					$	1,956					$	—					$	1,956

Level 3 Fair Value Measurement Activity

The following provides details of the Level 3 fair value measurement activity for the periods ended September 30, 2021 and 2020:

Investment securities:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Balance, beginning of period			$	24,925					$	23,834					$	31,503					$	24,279
Unrealized (loss) gain included in OCI			(964)						200						467						(229)
Principal payments and other			(487)						(142)						(4,951)						(158)
Sales			—						—						(3,545)						—
Balance, end of period			$	23,474					$	23,892					$	23,474					$	23,892

Interest rate lock commitments on residential mortgages:

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
Balance, beginning of period			$	456					$	986					$	673					$	103
Total gains (losses)
Included in earnings			90						157						(127)						1,040
Balance, end of period			$	546					$	1,143					$	546					$	1,143

Summary of Assets Measured at Fair Value on Nonrecurring Basis

The following table summarizes assets measured at fair value on a nonrecurring basis at September 30, 2021 and December 31, 2020:

			Level 1						Level 2						Level 3						Total Fair Value Measurements
September 30, 2021
Impaired Loans
Commercial real estate:
Owner occupied			$	—					$	—					$	776					$	776
Non-owner occupied residential			—						—						69						69
Residential mortgage:
First lien			—						—						677						677
Home equity - lines of credit			—						—						77						77
Total impaired loans			$	—					$	—					$	1,599					$	1,599
Mortgage servicing rights			$	—					$	—					$	3,642					$	3,642
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

September 30, 2021

Impaired loans

$

1,599

Appraisal of collateral

Management adjustments on appraisals for property type and recent activity

10% - 25% discount

- Management adjustments for liquidation expenses

6% - 18% discount

Mortgage servicing rights

$

3,642

Discounted cash flows

Weighted average CPR

14.53%

- Weighted average discount rate

9.04%

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%

Carrying Amounts and Estimated Fair Values of Financial Instruments

The following table presents carrying amounts and estimated fair values of the Company’s financial instruments at September 30, 2021 and December 31, 2020:

			Carrying Amount						Fair Value						Level 1						Level 2						Level 3
September 30, 2021
Financial Assets
Cash and due from banks			$	36,920					$	36,920					$	36,920					$	—					$	—
Interest-bearing deposits with banks			274,495						274,495						274,495						—						—
Restricted investments in bank stocks			7,051						n/a						n/a						n/a						n/a
Investment securities			445,018						445,018						20,228						401,316						23,474
Loans held for sale			6,412						6,412						—						6,412						—
Loans, net of allowance for loan losses			1,919,799						1,917,091						—						—						1,917,091
Derivatives			823						823						—						277						546
Accrued interest receivable			8,015						8,015						—						2,169						5,846
Financial Liabilities
Deposits			2,502,108						2,503,695						—						2,503,695						—
Securities sold under agreements to repurchase			27,595						27,595						—						27,595						—
FHLB advances and other			2,003						2,176						—						2,176						—
Subordinated notes			31,948						32,781						—						32,781						—
Derivatives			272						272						—						272						—
Accrued interest payable			631						631						—						631						—
Off-balance sheet instruments			—						—						—						—						—
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
Derivatives			1,363						1,363						—						690						673
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						—
Derivatives			1,956						1,956						—						1,956						—
Accrued interest payable			238						238						—						238						—
Off-balance sheet instruments			—						—						—						—						—

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- Definition

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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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