Fair Value (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value for the periods indicated:



	Fair Value		Readily Available Market Prices (Level 1)		Observable Market Data (Level 2)		Company Determined Fair Value (Level 3)
December 31, 2018
Financial assets:
Loans held for sale	$	4,403	$	—	$	4,403	$	—
AFS investments:
Obligations of states and political subdivisions	93,752		—		93,752		—
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises	453,672		—		453,672		—
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises	342,894		—		342,894		—
Subordinated corporate bonds	20,374		—		20,374		—
Equity securities - bank stock	746		—		746		—
Customer loan swaps	7,841		—		7,841		—
Fixed-rate mortgage interest rate lock commitments	95		—		95		—
Forward delivery commitments	32		—		32		—
FHLBB advance interest rate swaps	30		—		30		—
Financial liabilities:
Junior subordinated debt interest rate swaps	$	5,682	$	—	$	5,682	$	—
Customer loan swaps	7,841		—		7,841		—
Fixed-rate mortgage interest rate lock commitments	28		—		28		—
Forward delivery commitments	17		—		17		—
December 31, 2017
Financial assets:
Loans held for sale	$	8,103	$	—	$	8,103	$	—
AFS investments:
Obligations of states and political subdivisions	7,335		—		7,335		—
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises	503,302		—		503,302		—
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises	272,799		—		272,799		—
Subordinated corporate bonds	5,657		—		5,657		—
Equity investments	806		—		806		—
Customer loan swaps	5,036		—		5,036		—
Fixed-rate mortgage interest rate lock commitments	307		—		307		—
Forward delivery commitments	158		—		158		—
FHLBB advance interest rate swaps	21		—		21		—
Financial liabilities:
Junior subordinated debt interest rate swaps	$	7,571	$	—	$	7,571	$	—
Customer loan swaps	5,036		—		5,036		—
Fixed-rate mortgage interest rate lock commitments	22		—		22		—
Forward delivery commitments	16		—		16		—

Summary of Assets Measured at Fair Value on Non Recurring Basis

The table below highlights financial and non-financial assets measured and recorded at fair value on a non-recurring basis as of the dates indicated:



	Fair Value		Readily Available Market Prices (Level 1)		Observable Market Data (Level 2)		Company Determined Fair Value (Level 3)
December 31, 2018
Financial assets:
Collateral-dependent impaired loans	$	522	$	—	$	—	$	522
December 31, 2017
Financial assets:
Collateral-dependent impaired loans	$	3,696	$	—	$	—	$	3,696
Non-financial assets:
OREO	130		—		—		130

Valuation Methodology and Unobservable Inputs for Level Three Assets Measured at Fair Value on Non Recurring Basis

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at the dates indicated:



	Fair Value		Valuation Methodology	Unobservable input	Discount Range (Weighted-Average)
December 31, 2018
Collateral-dependent impaired loans:
Partially charged-off	$	50	Market approach appraisal of collateral	Management adjustment of appraisal	0%	(0%)
				Estimated selling costs	10%	(10%)
Specifically reserved	472		Market approach appraisal of collateral	Management adjustment of appraisal	0%	(0%)
				Estimated selling costs	10%	(10%)
December 31, 2017
Collateral-dependent impaired loans:
Partially charged-off	$	86	Market approach appraisal of collateral	Management adjustment of appraisal	0 - 50%	(18%)
				Estimated selling costs	0 - 10%	(6%)
Specifically reserved	3,610		Market approach appraisal of collateral	Management adjustment of appraisal	0%	(0%)
				Estimated selling costs	10%	(10%)
OREO	130		Market approach appraisal of collateral	Management adjustment of appraisal	20%	(20%)
				Estimated selling costs	10%	(10%)

Carrying Amounts and Estimated Fair Value for Financial Instrument Assets and Liabilities

The estimated fair values and related carrying amounts for assets and liabilities for which fair value is only disclosed are shown below as of the dates indicated:



	Carrying Amount		Fair Value		Readily Available Market Prices (Level 1)		Observable Market Prices (Level 2)		Company Determined Market Prices (Level 3)
December 31, 2018
Financial assets:
HTM securities	$	1,307	$	1,291	$	—	$	1,291	$	—
Residential real estate loans⁽¹⁾	986,795		957,957		—		—		957,957
Commercial real estate loans⁽¹⁾	1,257,879		1,218,436		—		—		1,218,436
Commercial loans⁽¹⁾⁽²⁾	411,479		404,805		—		—		404,805
Home equity loans⁽¹⁾	324,967		317,359		—		—		317,359
Consumer loans⁽¹⁾	20,390		18,969		—		—		18,969
Servicing assets	831		1,677		—		—		1,677
Financial liabilities:
Time deposits	$	661,281	$	654,954	$	—	$	654,954	$	—
Short-term borrowings	270,868		270,598		—		270,598		—
Long-term borrowings	11,580		11,573		—		11,573		—
Subordinated debentures	59,067		49,060		—		49,060		—
December 31, 2017
Financial assets:
HTM securities	$	94,073	$	94,913	$	—	$	94,913	$	—
Residential real estate loans⁽¹⁾	853,283		853,056		—		—		853,056
Commercial real estate loans⁽¹⁾	1,152,160		1,115,618		—		—		1,115,618
Commercial loans⁽¹⁾⁽²⁾	413,898		401,902		—		—		401,902
Home equity loans⁽¹⁾	321,011		318,230		—		—		318,230
Consumer loans⁽¹⁾	17,916		17,335		—		—		17,335
Servicing assets	1,025		1,766		—		—		1,766
Financial liabilities:
Time deposits	$	517,032	$	512,483	$	—	$	512,483	$	—
Short-term borrowings	541,796		541,605		—		541,605		—
Long-term borrowings	10,791		10,777		—		10,777		—
Subordinated debentures	58,911		44,333		—		44,333		—


(1)	The presented carrying amount is net of the allocated ALL.


(2)	Includes the HPFC loan portfolio.

Excluded from the summary were financial instruments measured at fair value on a recurring and nonrecurring basis, as previously described.