FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Dec. 31, 2017

FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract]

Summary of assets measured at fair value on a recurring basis

2017	Level I		Level II		Level III		Total
Fair value measurements on a recurring basis:
Securities available for sale:
U.S. Agency securities	$	-	$	98,887	$	-	$	98,887
U.S. Treasuries securities		28,604		-		-		28,604
Obligations of state and
political subdivisions		-		79,090		-		79,090
Corporate obligations		-		3,083		-		3,083
Mortgage-backed securities in
government sponsored entities		-		45,027		-		45,027
Equity securities in financial institutions		91		-		-		91

2016	Level I		Level II		Level III		Total
Fair value measurements on a recurring basis:
Securities available for sale:
U.S. Agency securities	$	-	$	170,414	$	-	$	170,414
U.S. Treasuries securities		3,000		-		-		3,000
Obligations of state and
political subdivisions		-		96,926		-		96,926
Corporate obligations		-		3,050		-		3,050
Mortgage-backed securities in
government sponsored entities		-		37,728		-		37,728
Equity securities in financial institutions		2,899		-		-		2,899

Summary of assets measured at fair value on non-recurring basis

2017	Level I		Level II		Level III		Total
Impaired Loans	$	-	$	-	$	1,569	$	1,569
Other real estate owned		-		-		1,024		1,024

2016	Level I		Level II		Level III		Total
Impaired Loans	$	-	$	-	$	2,033	$	2,033
Other real estate owned		-		-		839		839

Significant unobservable inputs used in fair value measurement process

The following table provides a listing of the significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques (dollars in thousands).

Quantitative Information about Level 3 Fair Value Measurements
2017	Fair Value		Valuation Technique(s)	Unobservable input	Range			Weighted average
Impaired Loans	$	1,569	Appraised Collateral Values	Discount for time since appraisal		0-100	%		30.83	%
				Selling costs		5%-9	%		8.35	%
				Holding period	6 - 12 months			11 months

Other real estate owned	$	1,024	Appraised Collateral Values	Discount for time since appraisal		15-65	%		26.26	%

2016	Fair Value		Valuation Technique(s)	Unobservable input	Range			Weighted average
Impaired Loans	$	2,033	Appraised Collateral Values	Discount for time since appraisal		0-65	%		28.98	%
				Selling costs		5%-9	%		7.56	%
				Holding period	6 - 12 months			11 months

Other real estate owned	$	839	Appraised Collateral Values	Discount for time since appraisal		10-67	%		25.45	%

Fair value of financial instruments

The fair values of the Company's financial instruments are as follows (in thousands):

	Carrying
December 31, 2017	Amount		Fair Value		Level I		Level II		Level III
Financial assets:
Cash and due from banks	$	18,517	$	18,517	$	18,517	$	-	$	-
Interest bearing time deposits with other banks		10,283		10,287		-		-		10,287
Available-for-sale securities		254,782		254,782		28,695		226,087		-
Loans held for sale		1,439		1,439		1,439
Net loans		989,335		981,238		-		-		981,238
Bank owned life insurance		26,883		26,883		26,883		-		-
Regulatory stock		6,784		6,784		6,784		-		-
Accrued interest receivable		4,196		4,196		4,196		-		-

Financial liabilities:
Deposits	$	1,104,943	$	1,101,583	$	838,490	$	-	$	263,093
Borrowed funds		114,664		113,452		77,650		-		35,802
Accrued interest payable		897		897		897		-		-

	Carrying
December 31, 2016	Amount		Fair Value		Level I		Level II		Level III
Financial assets:
Cash and due from banks	$	17,754	$	17,754	$	17,754	$	-	$	-
Interest bearing time deposits with other banks		6,955		6,960		-		-		6,960
Available-for-sale securities		314,017		314,017		5,899		308,118		-
Loans held for sale		1,827		1,827		1,827
Net loans		790,725		797,184		-		-		797,184
Bank owned life insurance		26,223		26,223		26,223		-		-
Regulatory stock		5,306		5,306		5,306		-		-
Accrued interest receivable		4,089		4,089		4,089		-		-

Financial liabilities:
Deposits	$	1,005,503	$	1,004,072	$	740,889	$	-	$	263,183
Borrowed funds		79,662		77,425		41,330		-		36,095
Accrued interest payable		720		720		720		-