Fair Value Disclosures (Tables)

12 Months Ended

Dec. 31, 2013

Assets and liabilities measured on recurring basis measured at fair value

The following table presents the balances of assets and liabilities that were measured at fair value on a recurring basis as of December 31, 2013 and 2012.



	At December 31, 2013
	Level 1		Level 2		Level 3		Total
Securities available for sale
Mortgage-backed securities	$	—	$	177,729,000	$	—	$	177,729,000
State and political subdivisions	—		126,315,000		—		126,315,000
Other equity securities	—		1,780,000		—		1,780,000
Total assets	$	—	$	305,824,000	$	—	$	305,824,000



	At December 31, 2012
	Level 1		Level 2		Level 3		Total
Securities available for sale
Mortgage-backed securities	$	—	$	169,093,000	$	—	$	169,093,000
State and political subdivisions	—		120,944,000		—		120,944,000
Other equity securities	—		1,577,000		—		1,577,000
Total assets	$	—	$	291,614,000	$	—	$	291,614,000

Assets and liabilities measured on non-recurring basis measured at fair value

The following table presents assets measured at fair value on a nonrecurring basis that have had a fair value adjustment since their initial recognition. Other real estate owned is presented net of an allowance for losses of $330,000 and $373,000 at December 2013 and 2012, respectively. Impaired loans measured at fair value only include impaired loans with a related specific allowance for loan losses and are presented net of their related specific allowance for loan losses of $1,309,000 and $3,539,000 at December 31, 2013 and 2012, respectively. The December 31, 2012 non-recurring fair value table includes all impaired loans with a related allowance. The Company refined its process for identifying impaired loans for purposes of fair value disclosures; accordingly the December 31, 2013 fair value table only includes those impaired loans for which the related allowance results in a fair value measure, as described above.



	At December 31, 2013
	Level 1		Level 2		Level 3		Total
Other real estate owned	$	—	$	4,807,000	$	—	$	4,807,000
Impaired loans	—		1,116,000		—		1,116,000
Total Assets	$	—	$	5,923,000	$	—	$	5,923,000



	At December 31, 2012
	Level 1		Level 2		Level 3		Total
Other real estate owned	$	—	$	7,593,000	$	—	$	7,593,000
Impaired loans	—		13,923,000		—		13,923,000
Total Assets	$	—	$	21,516,000	$	—	$	21,516,000

Estimated fair value of financial instruments

The carrying amounts and estimated fair values for financial instruments as of December 31, 2013 were as follows:



	Carrying		Estimated
As of December 31, 2013	value		fair value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	16,570,000	$	16,570,000	$	16,570,000	$	—	$	—
Interest bearing deposits in other banks	2,562,000		2,562,000		2,562,000		—		—
Securities available for sale	305,824,000		305,824,000		—		305,824,000		—
Securities to be held to maturity	169,277,000		158,336,000		—		158,336,000		—
Restricted equity securities	13,912,000		13,912,000		—		13,912,000		—
Loans held for sale	83,000		83,000		—		83,000		—
Loans (net of allowance for loan losses)
Commercial
Real estate	240,555,000		239,973,000		—		109,000		239,864,000
Construction	19,709,000		19,661,000		—		—		19,661,000
Other	92,625,000		92,855,000		—		229,000		92,626,000
Municipal	19,099,000		19,358,000		—		—		19,358,000
Residential
Term	375,932,000		381,918,000		—		778,000		381,140,000
Construction	11,778,000		11,794,000		—		—		11,794,000
Home equity line of credit	90,759,000		90,542,000		—		—		90,542,000
Consumer	14,396,000		14,438,000		—		—		14,438,000
Total loans	864,853,000		870,539,000		—		1,116,000		869,423,000
Mortgage servicing rights	1,158,000		1,948,000		—		1,948,000		—
Accrued interest receivable	5,038,000		5,038,000		—		5,038,000		—
Financial liabilities
Demand deposits	$	106,125,000	$	96,175,000	$	—	$	96,175,000	$	—
NOW deposits	151,322,000		129,815,000		—		129,815,000		—
Money market deposits	86,730,000		67,968,000		—		67,968,000		—
Savings deposits	149,103,000		122,891,000		—		122,891,000		—
Local certificates of deposit	226,658,000		228,767,000		—		228,767,000		—
National certificates of deposit	304,461,000		306,346,000		—		306,346,000		—
Total deposits	1,024,399,000		951,962,000		—		951,962,000		—
Repurchase agreements	94,477,000		94,477,000		—		94,477,000		—
Federal Home Loan Bank advances	184,648,000		189,644,000		—		189,644,000		—
Total borrowed funds	279,125,000		284,121,000		—		284,121,000		—
Accrued interest payable	599,000		599,000		—		599,000		—

The carrying amounts and estimated fair values for financial instruments as of December 31, 2012 were as follows:



	Carrying		Estimated
As of December 31, 2012	value		fair value		Level 1		Level 2		Level 3
Financial assets
Cash and cash equivalents	$	14,958,000	$	14,958,000	$	14,958,000	$	—	$	—
Interest bearing deposits in other banks	1,638,000		1,638,000		1,638,000		—		—
Securities available for sale	291,614,000		291,614,000		—		291,614,000		—
Securities to be held to maturity	143,320,000		150,247,000		—		150,247,000		—
Restricted equity securities	14,448,000		14,448,000		—		14,448,000		—
Loans held for sale	1,035,000		1,035,000		—		1,035,000		—
Loans (net of allowance for loan losses)
Commercial
Real estate	245,046,000		244,365,000		—		4,865,000		239,500,000
Construction	20,960,000		20,902,000		—		2,284,000		18,618,000
Other	78,985,000		79,312,000		—		472,000		78,840,000
Municipal	14,685,000		16,058,000		—		—		16,058,000
Residential
Term	378,258,000		390,223,000		—		6,302,000		383,921,000
Construction	6,447,000		6,430,000		—		—		6,430,000
Home equity line of credit	98,381,000		99,038,000		—		—		99,038,000
Consumer	14,022,000		14,392,000		—		—		14,392,000
Total loans	856,784,000		870,720,000		—		13,923,000		856,797,000
Mortgage servicing rights	867,000		1,228,000		—		1,228,000		—
Accrued interest receivable	4,912,000		4,912,000		—		4,912,000		—
Financial liabilities
Demand deposits	$	90,252,000	$	91,544,000	$	—	$	91,544,000	$	—
NOW deposits	147,309,000		141,436,000		—		141,436,000		—
Money market deposits	80,983,000		71,799,000		—		71,799,000		—
Savings deposits	135,250,000		126,142,000		—		126,142,000		—
Local certificates of deposit	218,571,000		223,748,000		—		223,748,000		—
National certificates of deposit	286,485,000		290,457,000		—		290,457,000		—
Total deposits	958,850,000		945,126,000		—		945,126,000		—
Repurchase agreements	101,504,000		101,504,000		—		101,504,000		—
Federal Home Loan Bank advances	181,401,000		189,321,000		—		189,321,000		—
Total borrowed funds	282,905,000		290,825,000		—		290,825,000		—
Accrued interest payable	619,000		619,000		—		619,000		—

- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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