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Fair Value Measurements | 3 Months Ended
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Mar. 31, 2015
Fair Value Disclosures [Abstract] |
Fair Value Measurements | NOTE 6 – FAIR VALUE MEASUREMENTS The following tables present information about the Bank’s assets and liabilities measured at fair value on a recurring basis and the valuation techniques used by the Bank to determine those fair values. In general, fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Bank has the ability to access. Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset or liability. In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Bank’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability. There were no liabilities measured at fair value as of March 31, 2015 or December 31, 2014. Disclosures concerning assets measured at fair value are as follows: Assets Measured at Fair Value on a Recurring Basis
|  | Quoted Prices |  |  |  |  |  |
|  | in Active |  | Significant |  |  |  |
|  | Markets for Identical |  | Other Observable |  | Significant Unobservable |  |
(Dollars in thousands) |  | Assets |  | Inputs |  | Inputs |  | Balance at
|  | (Level 1) |  | (Level 2) |  | (Level 3) |  | Date Indicated
Investment Securities, Available for |  |  |  |  |  |  |  |
Sale – March 31, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury notes and bonds |  | $ | — |  |  | $ | 8,121 |  |  | $ | — |  |  | $ | 8,121 |
U.S. Government and federal agency |  |  | — |  |  |  | 49,747 |  |  |  | — |  |  |  | 49,747 |
State and municipal |  |  | — |  |  |  | 62,164 |  |  |  | 10,781 |  |  |  | 72,945 |
Mortgage-backed |  |  | — |  |  |  | 8,554 |  |  |  | — |  |  |  | 8,554 |
Corporate |  |  | — |  |  |  | 7,185 |  |  |  | 397 |  |  |  | 7,582 |
Foreign debt |  |  | — |  |  |  | 1,001 |  |  |  | — |  |  |  | 1,001 |
Equity securities |  |  | 808 |  |  |  | — |  |  |  | 1,500 |  |  |  | 2,308 |
Asset backed securities |  |  | — |  |  |  | 349 |  |  |  | — |  |  |  | 349 |
Total |  | $ | 808 |  |  | $ | 137,121 |  |  | $ | 12,678 |  |  | $ | 150,607 |
Investment Securities, Available for |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Sale - December 31, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury notes and bonds |  | $ | — |  |  | $ | 8,058 |  |  | $ | — |  |  | $ | 8,058 |
U.S. Government and federal agency |  |  | — |  |  |  | 44,503 |  |  |  | — |  |  |  | 44,503 |
State and municipal |  |  | — |  |  |  | 60,091 |  |  |  | 9,744 |  |  |  | 69,835 |
Mortgage-backed |  |  | — |  |  |  | 8,942 |  |  |  | — |  |  |  | 8,942 |
Corporate |  |  | — |  |  |  | 7,140 |  |  |  | 398 |  |  |  | 7,538 |
Foreign debt |  |  | — |  |  |  | 994 |  |  |  | — |  |  |  | 994 |
Equity securities |  |  | 775 |  |  |  | — |  |  |  | 1,500 |  |  |  | 2,275 |
Asset backed securities |  |  | — |  |  |  | 376 |  |  |  | — |  |  |  | 376 |
Total |  | $ | 775 |  |  | $ | 130,104 |  |  | $ | 11,642 |  |  | $ | 142,521 |
Changes in Level 3 Assets Measured at Fair Value on a Recurring Basis
(Dollars in thousands) |  |  |  |  |  |  |  |
|  |  | 2015 |  |  |  | 2014 |
Investment Securities, Available for Sale |  |  |  |  |  |  |  |
Balance, January 1 |  | $ | 11,641 |  |  | $ | 11,328 |
Total realized and unrealized gains included in income |  |  | — |  |  |  | — |
Total unrealized gains (losses) included in other comprehensive income |  |  | 60 |  |  |  | (261 | )
Net purchases, sales, calls, and maturities |  |  | 977 |  |  |  | (17 | )
Net transfers into Level 3 |  |  | — |  |  |  | 74 |
Balance, March 31 |  | $ | 12,678 |  |  | $ | 11,124 |
Of the Level 3 assets that were held by the Bank at March 31, 2015, the net unrealized loss for the three months ended March 31, 2015 was $59,000, which is recognized in other comprehensive income in the consolidated balance sheet. $995,000 of Level 3 securities were purchased during the first quarter of 2015. There were no purchases of Level 3 securities in the first quarter of 2014. There were no sales of Level 3 securities during the first quarter of 2015 or 2014. Both observable and unobservable inputs may be used to determine the fair value of positions classified as Level 3 investment securities and liabilities. As a result, the unrealized gains and losses for these assets and liabilities presented in the tables above may include changes in fair value that were attributable to both observable and unobservable inputs. Available for sale investment securities categorized as Level 3 assets primarily consist of bonds issued by local municipalities. The Bank estimates the fair value of these bonds based on the present value of expected future cash flows using management’s best estimate of key assumptions, including forecasted interest yield and payment rates, credit quality and a discount rate commensurate with the current market and other risks involved. The Bank also has assets that under certain conditions are subject to measurement at fair value on a non-recurring basis. These assets are not normally measured at fair value, but can be subject to fair value adjustments in certain circumstances, such as impairment. Disclosures concerning assets measured at fair value on a non-recurring basis are as follows: Assets Measured at Fair Value on a Non-recurring Basis
|  |  |  | Quoted Prices |  |  |  |
|  |  |  | in Active |  | Significant |  |
|  |  |  | Markets for Identical |  | Other Observable |  | Significant Unobservable
(Dollars in thousands) |  | Balance at |  | Assets |  | Inputs |  | Inputs
|  | Dates Indicated |  | (Level 1) |  | (Level 2) |  | (Level 3)
Impaired Loans |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
March 31, 2015 |  | $ | 5,986 |  |  | $ | — |  |  | $ | — |  |  | $ | 5,986 |
December 31, 2014 |  | $ | 6,885 |  |  | $ | — |  |  | $ | — |  |  | $ | 6,885 |
Other Real Estate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
March 31, 2015 |  | $ | 249 |  |  | $ | — |  |  | $ | — |  |  | $ | 249 |
December 31, 2014 |  | $ | 150 |  |  | $ | — |  |  | $ | — |  |  | $ | 150 |
Impaired loans categorized as Level 3 assets consist of non-homogeneous loans that are considered impaired. The Bank estimates the fair value of the loans based on the present value of expected future cash flows using management’s estimate of key assumptions. These assumptions include future payment ability, timing of payment streams, and estimated realizable values of available collateral (typically based on outside appraisals). The changes in fair value consisted of charge-downs of impaired loans that were posted to the allowance for loan losses and write-downs of other real estate that were posted to a valuation account.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=49121117&loc=d3e13537-108611 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=49121117&loc=d3e13433-108611 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 28 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14064-108612 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 16 -URI http://asc.fasb.org/extlink&oid=49121117&loc=d3e13504-108611 + Details
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