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Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Estimated Fair Values and Related Carrying or Notional Amounts

The estimated fair values, and related carrying or notional amounts, for on and off-balance sheet financial instruments as of December 31, 2021 and 2020, are reflected below. The aggregate fair values in the table below do not represent the total market value of the Bank’s assets and liabilities.  The table excludes the following: Bank Premises and Equipment, Goodwill, Mortgage Servicing Rights, Other Real Estate Owned, Other Assets, Other Liabilities and Accrued Expenses.

		(In Thousands)
		December 31, 2021																					December 31, 2020
		Carrying				Fair																	Carrying				Fair
		Amount				Value				Level 1				Level 2				Level 3					Amount				Value				Level 1				Level 2				Level 3
Financial Assets:
Cash and cash equivalents		$	180,823			$	180,832			$	180,823			$	-			$	-				$	175,706			$	175,706			$	175,706			$	-			$	-
Interest-bearing time deposits			10,913				10,933				-				10,933				-					4,653				4,677				-				4,677				-
Securities - available-for-sale			429,931				429,931				89,177				335,981				4,773					307,812				307,812				-				306,250				1,562
Other securities			8,162				8,162				-				-				8,162					5,939				5,939				-				-				5,939
Loans held for sale			7,714				7,844				-				-				7,844					7,740				7,740				-				-				7,740
Loans, net			1,841,177				1,864,386				-				-				1,864,386					1,289,318				1,261,440				-				-				1,261,440
Interest receivable			7,209				7,209				-				-				7,209					6,188				6,188				-				-				6,188
Financial Liabilities:
Interest bearing deposits		$	1,248,294			$	1,248,044			$	-			$	-			$	1,248,044				$	997,462			$	1,004,608			$	-			$	-			$	1,004,608
Noninterest bearing deposits			473,689				473,689				-				473,689				-					351,147				351,147				-				351,147				-
Time deposits			471,479				475,810				-				-				475,810					247,553				250,135				-				-				250,135
Total Deposits			2,193,462				2,197,543				-				473,689				1,723,854					1,596,162				1,605,890				-				351,147				1,254,743
Fed funds purchased and    securities sold under    agreement to repurchase			29,268				29,268				-				-				29,268					30,239				30,239				-				-				30,239
Federal Home Loan Bank advances			24,065				24,305				-				-				24,305					17,861				17,872				-				-				17,872
Other borrowings			40,000				40,000				-				40,000				-					-				-				-				-				-
Subordinated notes			34,471				35,000				-				35,000				-					-				-				-				-				-
Interest payable			1,125				1,125				-				-				1,125					338				338				-				-				338

Financial Assets Measured at Fair Value on Recurring Basis

The following table summarizes financial assets measured at fair value on a recurring basis as of December 31, 2021 and December 31, 2020 segregated by level or the valuation inputs within the fair value hierarchy utilized to measure fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis (in Thousands)
		Quoted Prices in				Significant				Significant
		Active Markets				Observable				Observable
		for Identical				Inputs				Inputs
December 31, 2021		Assets (Level 1)				(Level 2)				(Level 3)
Assets-(Securities Available-for-Sale)
U.S. Treasury		$	89,177			$	-			$	-
U.S. Government agencies			-				156,886				-
Mortgage-backed securities			-				117,927				-
State and local governments			-				61,168				4,773
Total Securities Available-for-Sale		$	89,177			$	335,981			$	4,773

		Quoted Prices in				Significant				Significant
		Active Markets				Observable				Observable
		for Identical				Inputs				Inputs
December 31, 2020		Assets (Level 1)				(Level 2)				(Level 3)
Assets-(Securities Available-for-Sale)
U.S. Treasury		$	-			$	-			$	-
U.S. Government agencies			-				124,241				-
Mortgage-backed securities			-				113,056				-
State and local governments			-				68,953				1,562
Total Securities Available-for-Sale		$	-			$	306,250			$	1,562

Changes in the Level 3 Fair-Value Category of Unobservable Inputs

		(In Thousands)
		Fair Value Measurements Using Significant
		Unobservable Inputs (Level 3)
		State and Local				State and Local				State and Local
		Governments				Governments				Governments
		Tax-Exempt				Taxable				Total
Balance at January 1, 2021		$	-			$	1,562			$	1,562
Change in Market Value			44				(96	)			(52	)
Purchases			2,418				1,000				3,418
Sales			-				-				-
Payments & Maturities			(155	)			-				(155	)
Balance at December 31, 2021		$	2,307			$	2,466			$	4,773

		(In Thousands)
		Fair Value Measurements Using Significant
		Unobservable Inputs (Level 3)
		State and Local				State and Local				State and Local
		Governments				Governments				Governments
		Tax-Exempt				Taxable				Total
Balance at January 1, 2020		$	-			$	1,490			$	1,490
Change in Market Value			-				72				72
Purchases			-				-				-
Sales			-				-				-
Payments & Maturities			-				-				-
Balance at December 31, 2020		$	-			$	1,562			$	1,562

Collateral Dependent Impaired Loans and Other Real Estate

The following table presents collateral dependent impaired loans and other real estate owned as recorded at fair value:

		($ in Thousands)
		Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2021
						Quoted Prices in
						Markets for				Significant				Significant
		Balance at				Identical				Observable Inputs				Unobservable Inputs
		December 31, 2021				Assets (Level 1)				(Level 2)				(Level 3)
Collateral dependent impaired     loans		$	8,527			$	-			$	-			$	8,527
Mortgage servicing rights			3,157				-				-				3,157
Other real estate owned -     residential			99				-				-				99

		($ in Thousands)
		Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2020
						Quoted Prices in
						Markets for				Significant				Significant
		Balance at				Identical				Observable Inputs				Unobservable Inputs
		December 31, 2020				Assets (Level 1)				(Level 2)				(Level 3)
Collateral dependent impaired     loans		$	7,703			$	-			$	-			$	7,703
Mortgage servicing rights			-				-				-				-
Other real estate owned -     residential			-				-				-				-

Quantitative Information about Unobservable Inputs Used in Recurring and Nonrecurring Level 3 Fair Value Measurements

The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements:

		(In Thousands)
		Fair Value at December 31, 2021				Valuation Technique		Unobservable Inputs		Range (Weighted Average)
State and local    government		$	4,773			Discounted Cash Flow		Credit strength of underlying project or entity / Discount rate		0.21-1.77% (1.33%)
Collateral dependent    impaired loans			8,527			Collateral based measurements		Discount to reflect current market conditions and ultimate collectability		20.00-53.95% (34.78%)
Mortgage servicing     rights			3,157			Discounted Cash Flow		Constant prepayment rate and probability of default / Discount rate		1.94-27.70% (18.44%)
Other real estate    owned - residential			99			Appraisals		Discount to reflect current market		32.72% (32.72%)

		(In Thousands)
		Fair Value at December 31, 2020				Valuation Technique		Unobservable Inputs		Range (Weighted Average)
State and local    government		$	1,562			Discounted Cash Flow		Credit strength of underlying project or entity / Discount rate		1.19-1.19% (1.19%)
Collateral dependent    impaired loans			7,703			Collateral based measurements		Discount to reflect current market conditions and ultimate collectability		0.71-100% (17.71%)
Mortgage servicing     rights			-			Discounted Cash Flow		Constant prepayment rate and probability of default / Discount rate		— % ( — )
Other real estate    owned - residential			-			Appraisals		Discount to reflect current market		— % ( — )

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- 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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Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

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