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Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Financial Assets Measured at Fair Value on Recurring Basis

The following summarizes financial assets measured at fair value on a recurring basis as of June 30, 2024 and December 31, 2023, 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)
June 30, 2024		Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Assets - (Securities Available-for-Sale)
U.S. Treasury		$	75,114			$	-			$	-
U.S. Government agencies			19,651				108,920				-
Mortgage-backed securities			-				96,710				-
State and local governments			-				63,028				1,786
Total Securities Available-for-Sale		$	94,765			$	268,658			$	1,786
Interest rate swap liabilities		$	-			$	(567	)		$	-


		(In Thousands)
December 31, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Assets - (Securities Available-for-Sale)
U.S. Treasury		$	80,270			$	-			$	-
U.S. Government agencies			19,630				108,592				-
Mortgage-backed securities			-				82,132				-
State and local governments			-				65,394				2,460
Total Securities Available-for-Sale		$	99,900			$	256,118			$	2,460
Interest rate swaps liabilities		$	-			$	(2,679	)		$	-

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

The following tables represent the changes in the Level 3 fair-value category of which unobservable inputs are relied upon as of the three and six month periods ended June 30, 2024 and June 30, 2023.


		(In Thousands)
		Fair Value Measurements Using Significant
		Unobservable Inputs (Level 3)
		State and Local Governments
		Tax-Exempt				Taxable				Total
Balance at April 1, 2024		$	521			$	1,274			$	1,795

Change in Fair Value			(1	)			(8	)			(9	)

Payments, Maturities & Calls			-				-				-

Balance at June 30, 2024		$	520			$	1,266			$	1,786


		(In Thousands)
		Fair Value Measurements Using Significant
		Unobservable Inputs (Level 3)
		State and Local Governments
		Tax-Exempt				Taxable				Total
Balance at January 1, 2024		$	1,188			$	1,272			$	2,460

Change in Fair Value			(3	)			(6	)			(9	)

Payments, Maturities & Calls			(665	)			-				(665	)

Balance at June 30, 2024		$	520			$	1,266			$	1,786


		(In Thousands)
		Fair Value Measurements Using Significant
		Unobservable Inputs (Level 3)
		State and Local Governments
		Tax-Exempt				Taxable				Total
Balance at April 1, 2023		$	1,835			$	1,305			$	3,140

Change in Fair Value			(4	)			(27	)			(31	)

Payments, Maturities & Calls			-				-				-

Balance at June 30, 2023		$	1,831			$	1,278			$	3,109


		(In Thousands)
		Fair Value Measurements Using Significant
		Unobservable Inputs (Level 3)
		State and Local Governments
		Tax-Exempt				Taxable				Total
Balance at January 1, 2023		$	2,071			$	1,274			$	3,345

Change in Fair Value			5				4				9

Payments, Maturities & Calls			(245	)			-				(245	)

Balance at June 30, 2023		$	1,831			$	1,278			$	3,109

Assets Measured at Fair Value on Nonrecurring Basis

The following table presents assets measured at fair value on a nonrecurring basis at June 30, 2024 and December 31, 2023:


		(In Thousands)
		Assets Measured at Fair Value on a Nonrecurring Basis at June 30, 2024
		Balance at June 30, 2024				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Collateral dependent loans		$	2,776			$	-			$	-			$	2,776
Loan servicing rights			51				-				-				51


		(In Thousands)
		Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2023
		Balance at December 31, 2023				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Collateral dependent loans		$	22,676			$	-			$	-			$	22,676
Loan servicing rights			58				-				-				58

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)								Range
		Fair Value at								(Weighted
		June 30, 2024				Valuation Technique		Unobservable Inputs		Average)
State and local government		$	1,786			Discounted Cash Flow		Credit strength of underlying project or entity / discount rate		3.76-5.00% (4.73%)

Collateral dependent loans			2,776			Collateral based measurements		Discount to reflect current market conditions and ultimate collectability		0.00-20.00% (5.05%)

Loan servicing rights			51			Discounted Cash Flow		Constant prepayment rate and probability of default / discount rate		9.39-22.80% (12.88%)


		(In Thousands)								Range
		Fair Value at								(Weighted
		December 31, 2023				Valuation Technique		Unobservable Inputs		Average)
State and local government		$	2,460			Discounted Cash Flow		Credit strength of underlying project or entity / discount rate		-0.17-4.92% (3.49%)

Collateral dependent loans			22,676			Collateral based measurements		Discount to reflect current market conditions and ultimate collectability		0.00-50.00% (0.41%)

Loan servicing rights			58			Discounted Cash Flow		Constant prepayment rate and probability of default / discount rate		5.11-22.80% (10.87%)

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 June 30, 2024 and December 31, 2023 are reflected below.


		(In Thousands)
		June 30, 2024
		Carrying				Fair
		Amount				Value				Level 1				Level 2				Level 3
Financial Assets:
Cash and cash equivalents		$	193,068			$	193,068			$	193,068			$	-			$	-
Interest-bearing time deposits			3,221				3,197				-				3,197				-
Securities - available-for-sale			365,209				365,209				94,765				268,658				1,786
Other securities			14,721				14,721				-				-				14,721
Loans held for sale			1,628				1,603				-				-				1,603
Loans, net			2,534,468				2,507,497				-				-				2,507,497
Interest receivable			13,327				13,327				-				-				13,327

Financial Liabilities:
Interest bearing deposits		$	1,494,429			$	1,493,910			$	-			$	-			$	1,493,910
Non-interest bearing deposits			479,069				479,069				479,069				-				-
Time deposits			667,592				661,792				-				-				661,792
Total Deposits			2,641,090				2,634,771				479,069				-				2,155,702

Federal funds purchased and securities sold under agreement to repurchase			27,218				27,218				-				-				27,218
Federal Home Loan Bank advances			266,102				266,231				-				-				266,231
Subordinated notes, net of unamortized issuance costs			34,759				30,223				-				30,223				-
Interest payable			6,459				6,459				-				-				6,459


		(In Thousands)
		December 31, 2023
		Carrying				Fair
		Amount				Value				Level 1				Level 2				Level 3
Financial Assets:
Cash and cash equivalents		$	142,201			$	142,201			$	142,201			$	-			$	-
Interest-bearing time deposits			2,740				2,725				-				2,725				-
Securities - available-for-sale			358,478				358,478				99,900				256,118				2,460
Other securities			17,138				17,138				-				-				17,138
Loans held for sale			1,576				1,552				-				-				1,552
Loans, net			2,556,167				2,396,540				-				-				2,396,540
Interest receivable			11,774				11,774				-				-				11,774

Financial Liabilities:
Interest bearing deposits		$	1,415,981			$	1,416,007			$	-			$	-			$	1,416,007
Non-interest bearing deposits			528,465				528,465				528,465				-				-
Time deposits			663,017				656,141				-				-				656,141
Total Deposits			2,607,463				2,600,613				528,465				-				2,072,148

Federal funds purchased and securities sold under agreement to repurchase			28,218				28,218				-				-				28,218
Federal Home Loan Bank advances			265,750				260,400				-				-				260,400
Subordinated notes, net of unamortized issuance costs			34,702				30,676				-				30,676				-
Interest payable			5,441				5,441				-				-				5,441

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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