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FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2023

Fair Value Disclosures [Abstract]

Summary of Assets Measured at Fair Value on Recurring Basis

The following table summarizes assets and liabilities measured at fair value on a recurring basis at March 31, 2023 and December 31, 2022:

			Level 1						Level 2						Level 3						Total Fair Value Measurements
March 31, 2023
Financial Assets
Investment securities:
U.S. Treasury securities			$	17,693					$	—					$	—					$	17,693
U.S. Government Agencies			—						4,972						—						4,972
States and political subdivisions			—						197,509						6,093						203,602
GSE residential MBSs			—						59,371						—						59,371
GSE commercial MBSs			—						5,737						—						5,737
GSE residential CMOs			—						68,104						—						68,104
Non-agency CMOs			—						18,794						22,097						40,891
Asset-backed			—						119,492						—						119,492
Other			370						—						—						370
Loans held for sale			—						7,341						—						7,341
Derivatives			—						8,608						57						8,665
Totals			$	18,063					$	489,928					$	28,247					$	536,238
Financial Liabilities
Derivatives			$	—					$	9,309					$	—					$	9,309
December 31, 2022
Financial Assets
Investment securities:
U.S. Treasury securities			$	17,291					$	—					$	—					$	17,291
U.S. Government Agencies			—						5,135						—						5,135
States and political subdivisions			—						191,488						5,926						197,414
GSE residential MBSs			—						59,402						—						59,402
GSE residential CMOs			—						68,378						—						68,378
Non-agency CMOs			—						18,491						21,267						39,758
Asset-backed			—						125,973						—						125,973
Other			377						—						—						377
Loans held for sale			—						10,880						—						10,880
Derivatives			—						10,482						35						10,517
Totals			$	17,668					$	490,229					$	27,228					$	535,125
Financial Liabilities
Derivatives			$	—					$	11,333					$	—					$	11,333

Level 3 Fair Value Measurement Activity

The following provides details of the Level 3 fair value measurement activity for the periods ended March 31, 2023 and 2022:

Investment securities:

									Three Months Ended March 31,
															2023						2022
Balance, beginning of period															$	27,193					$	23,147
Unrealized gains (losses) included in OCI															220						(1,360)
Purchases															871						—
Net discount accretion															13						71
Principal payments and other															(107)						—
Sales															—						(3,053)
OTTI															—						(171)
Balance, end of period															$	28,190					$	18,634

Interest rate lock commitments on residential mortgages:

									Three Months Ended March 31,
															2023						2022
Balance, beginning of period															$	35					$	353
Total gains (losses) included in earnings															22						(53)
Balance, end of period															$	57					$	300

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, 2023 and December 31, 2022:

			Level 1						Level 2						Level 3						Total Fair Value Measurements
March 31, 2023
Individually Evaluated Loans
Commercial real estate:
Owner occupied			$	—					$	—					$	112					$	112
Non-owner occupied residential			—						—						53						53
Commercial and industrial			—						—						15						15
Residential mortgage:
First lien			—						—						287						287
Home equity - lines of credit			—						—						80						80
Total individually evaluated loans			$	—					$	—					$	547					$	547
Mortgage servicing rights			$	—					$	—					$	—					$	—
December 31, 2022
Impaired Loans
Commercial real estate:
Owner occupied			$	—					$	—					$	116					$	116
Non-owner occupied residential			—						—						9						9
Residential mortgage:
First lien			—						—						309						309
Home equity - lines of credit			—						—						86						86
Total impaired loans			$	—					$	—					$	520					$	520
Mortgage servicing rights			$	—					$	—					$	—					$	—

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, 2023

Individually evaluated loans

$

547

Appraisal of collateral

Management adjustments on appraisals for property type and recent activity

10% - 25% discount

- Management adjustments for liquidation expenses

6.08% - 19.74% discount

December 31, 2022

Impaired loans

$

520

Appraisal of collateral

Management adjustments on appraisals for property type and recent activity

10% - 25% discount

- Management adjustments for liquidation expenses

6.08% - 17.93% discount

Carrying Amounts and Estimated Fair Values of Financial Instruments

The following table presents carrying amounts and estimated fair values of the financial assets and liabilities at March 31, 2023 and December 31, 2022:

			Carrying Amount						Fair Value						Level 1						Level 2						Level 3
March 31, 2023
Financial Assets
Cash and due from banks			$	27,612					$	27,612					$	27,612					$	—					$	—
Interest-bearing deposits with banks			70,711						70,711						70,711						—						—
Restricted investments in bank stock			12,869						n/a						n/a						n/a						n/a
Investment securities			520,232						520,232						18,063						473,979						28,190
Loans held for sale			7,341						7,341						—						7,341						—
Loans, net of allowance for credit losses			2,179,137						2,048,188						—						—						2,048,188
Derivatives			8,665						8,665						—						8,608						57
Accrued interest receivable			10,911						10,911						—						4,055						6,856
Financial Liabilities
Deposits			2,488,109						2,483,440						—						2,483,440						—
Deposits held for assumption in connection with sale of bank branches			27,517						25,866						—						25,866						—
Securities sold under agreements to repurchase and federal funds purchased			13,989						13,989						—						13,989						—
FHLB advances and other borrowings			162,326						162,312						—						162,312						—
Subordinated notes			32,042						31,060						—						31,060						—
Derivatives			9,309						9,309						—						9,309						—
Accrued interest payable			1,394						1,394						—						1,394						—
Off-balance sheet instruments			—						—						—						—						—
December 31, 2022
Financial Assets
Cash and due from banks			$	28,477					$	28,477					$	28,477					$	—					$	—
Interest-bearing deposits with banks			32,346						32,346						32,346						—						—
Restricted investments in bank stock			10,642						n/a						n/a						n/a						n/a
Investment securities			513,728						513,728						17,668						468,867						27,193
Loans held for sale			10,880						10,880						—						10,880						—
Loans, net of allowance for loan losses			2,126,054						1,991,164						—						—						1,991,164
Derivatives			10,517						10,517						—						10,482						35
Accrued interest receivable			11,027						11,027						—						4,441						6,586
Financial Liabilities
Deposits			2,444,939						2,440,660						—						2,440,660						—
Deposits held for assumption in connection with sale of bank branches			31,307						29,429						—						29,429						—
Securities sold under agreements to repurchase			17,251						17,251						—						17,251						—
FHLB advances and other borrowings			106,139						106,141						—						106,141						—
Subordinated notes			32,026						31,321						—						31,321						—
Derivatives			11,333						11,333						—						11,333						—
Accrued interest payable			457						457						—						457						—
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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