FAIR VALUE (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of Financial Assets (Liabilities) Measured at Fair Value

The following table summarizes quantitative disclosures about the fair value measurements for each category of financial assets (liabilities) carried at fair value as of December 31:



2018	Fair Value			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
Assets (liabilities) at fair value on a recurring basis:
Available for sale securities
Mortgage-backed securities	$	89,459		$	—	$	89,459		$	—
Collateralized mortgage obligations	108,969			—		108,969			—
Municipal securities	15,593			—		15,593			—
Corporate bonds	18,954			—		18,954			—
Derivative instruments	(392		)	—		(392		)	—

Assets at fair value on a nonrecurring basis:
Impaired loans	10,863			—		—			10,863
Other real estate owned	751			—		—			751



2017	Fair Value			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
Assets (liabilities) at fair value on a recurring basis:
Available for sale securities
Mortgage-backed securities	$	90,678		$	—	$	90,678		$	—
Collateralized mortgage obligations	115,311			—		115,311			—
Municipal securities	7,546			—		7,546			—
Corporate bonds	18,837			—		18,837			—
Derivative instruments	(571		)	—		(571		)	—

Assets at fair value on a nonrecurring basis:
Impaired loans	6,206			—		—			6,206
Other real estate owned	2,244			—		—			2,244

Schedule of Foreclosed Assets Measured at Fair Value

The following table presents foreclosed assets that were remeasured and recorded at fair value as of December 31:



	2018			2017
Other real estate owned remeasured at initial recognition:
Carrying value of other real estate owned prior to remeasurement	$	542		$	1,082
Charge-offs recognized in the allowance for loan losses	(25		)	(195		)
Fair value of other real estate owned remeasured at initial recognition	$	517		$	887



	2018			2017		2016
Other real estate owned remeasured subsequent to initial recognition:
Carrying value of other real estate owned prior to remeasurement	$	599		$	—	$	170
Write-downs included in collection and other real estate owned expense	(56		)	—		(69		)
Fair value of other real estate owned remeasured subsequent to initial recognition	$	543		$	—	$	101

Schedule of Quantitative Information About Nonrecurring Level 3 Fair Value Measurements

The following table presents quantitative information about nonrecurring Level 3 fair value measurements at:



	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
December 31, 2018
Impaired loans	$	10,863	Fair value of collateral- sales comparison approach	Selling costs or other normal adjustments: Real estate Equipment	10%-20% (16%) 10%-20% (19%)
Other real estate owned	$	751	Appraisal value of collateral	Selling costs or other normal adjustments	10%-20% (16%)



	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
December 31, 2017
Impaired loans	$	6,206	Fair value of collateral- sales comparison approach	Selling costs or other normal adjustments: Real estate Equipment	10%-20% (16%) 10%-20% (3.6%)
Other real estate owned	$	2,244	Appraisal value of collateral	Selling costs or other normal adjustments	10%-20% (16%)

Schedule of Carrying Amounts And Estimated Fair Values of Financial Instruments

The carrying amounts and estimated fair values of financial instruments, not previously in this note, at December 31, 2018 and 2017 are as follows:



	Fair Value Measurements at December 31, 2018 Using:
	Carrying Amount		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
Financial assets:
Cash, due from banks, federal funds sold and interest-bearing deposits	$	71,510	$	71,510	$	—	$	—	$	71,510
Marketable securities held to maturity	163,164		—		162,800		—		162,800
Loans, net	1,645,444		—		—		1,630,600		1,630,600
Accrued interest receivable	9,292		—		9,292		—		9,292
Nonmarketable equity securities	14,937		—		14,937		—		14,937
Cash surrender value of life insurance	26,301		—		26,301		—		26,301
Financial liabilities:
Deposits	$	1,871,480	$	1,435,985	$	434,647	$	—	$	1,870,632
Securities sold under repurchase agreements	12,228		—		12,228		—		12,228
Accrued interest payable	1,651		—		1,651		—		1,651
Other debt	—		—		—		—		—
Federal Home Loan Bank advances	115,136		—		114,934		—		114,934
Subordinated debentures	12,810		—		10,724		—		10,724



	Fair Value Measurements at December 31, 2017 Using:
	Carrying Amount		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
Financial assets:
Cash, due from banks, federal funds sold and interest-bearing deposits	$	91,428	$	66,657	$	24,771	$	—	$	91,428
Marketable securities held to maturity	174,684		—		176,790		—		176,790
Loans, net	1,347,779		—		—		1,346,361		1,346,361
Accrued interest receivable	8,174		—		8,174		—		8,174
Nonmarketable equity securities	9,453		—		9,453		—		9,453
Cash surrender value of life insurance	19,117		—		19,117		—		19,117
Financial liabilities:
Deposits	$	1,676,320	$	1,378,467	$	297,978	$	—	$	1,676,445
Securities sold under repurchase agreements	12,879		—		12,879		—		12,879
Accrued interest payable	922		—		922		—		922
Other debt	—		—		—		—		—
Federal Home Loan Bank advances	45,153		—		44,722		—		44,722
Subordinated debentures	13,810		—		11,495		—		11,495

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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