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Financial Instruments
 12 Months Ended
Dec. 31, 2018
Investments, All Other Investments [Abstract]  
Financial Instruments

Note 17 – Financial Instruments

 

Financial instruments as of the dates indicated were as follows:

 

(Dollars in thousands)   Carrying
Amount		     Estimated
Fair Value		     Quoted Prices
In Active
Markets for
Identical
Assets
(Level 1)		     Significant
Other
Observable
Inputs
(Level 2)		     Significant
Unobservable
Inputs
(Level 3)		  
December 31, 2018                              
Assets                              
Cash and due from banks   $ 19,690     $ 19,690     $ 19,690     $ —     $ —  
Equity securities at fair value     2,847       2,847       1,961       —       886  
Securities available for sale     166,602       166,602       —       158,104       8,498  
Federal Home Loan Bank and Federal Reserve Bank stock     3,567       3,567       —       3,567       —  
Loans held for sale     831       856       —       856       —  
Loans to other financial institutions     20,644       20,644       —       20,644       —  
Loans, net     404,400       399,091       —       —       399,091  
Accrued interest receivable     2,267       2,267       —       2,267       —  
                                         
Liabilities                                        
Noninterest-bearing deposits     153,542       153,542       —       153,542       —  
Interest-bearing deposits     423,473       422,381       —       422,381       —  
Federal funds purchased     4,800       4,800       —       4,800       —  
Federal Home Loan Bank advances     5,233       5,241       —       5,241       —  
Accrued interest payable     210       210       —       210       —  
                                         
December 31, 2017                                        
Assets                                        
Cash and due from banks   $ 36,837     $ 36,837     $ 36,837     $ —     $ —  
Securities available for sale     155,591       155,591       1,892       140,301       13,398  
Federal Home Loan Bank and Federal Reserve Bank stock     3,567       3,567       —       3,567       —  
Loans held for sale     1,721       1,773       —       1,773       —  
Loans to other financial institutions     6,802       6,802       —       6,802       —  
Loans, net     394,208       394,819       —       —       394,819  
Accrued interest receivable     2,146       2,146       —       2,146       —  
                                         
Liabilities                                        
Noninterest-bearing deposits     151,462       151,462       —       151,462       —  
Interest-bearing deposits     388,391       387,343       —       387,343       —  
Repurchase agreements     7,148       7,148       —       7,148       —  
Federal Home Loan Bank advances     20,268       20,271       —       20,271       —  
Accrued interest payable     49       49       —       49       —  

 

The estimated fair values approximate the carrying amounts for all financial instruments except those described later in this paragraph. The methodology for determining the estimated fair value for securities available for sale is described in Note 18. The estimated fair value for loans in 2017 was based on the rates charged at December 31 for new loans with similar maturities, applied until the loan is assumed to reprice or be paid. In 2018, the estimated fair value of loans follows the guidance in ASU 2016-01 which prescribes an “exit price” approach, which incorporates discounts for credit, liquidity, and marketability. The allowance for loan losses is considered to be a reasonable estimate of discount for credit quality concerns. The estimated fair value of deposits is based on comparing the average rate paid on deposits compared to the three month Libor rate which is assumed to be the replacement value of these deposits. At December 31, 2018, all average rates were lower than the three month Libor rate causing fair values to be higher than carrying amounts. The estimated fair values for time deposits and FHLB advances are based on the rates paid at December 31 for new deposits or FHLB advances, applied until maturity. The estimated fair values for other financial instruments and off-balance sheet loan commitments are considered nominal.